EU CBAM Implementing Acts, Annexes & Amendments for the Definitive Phase

Executive Summary

On 16 December 2025, the European Commission released a legislative package to operationalise the Carbon Border Adjustment Mechanism (CBAM) for its definitive phase, effective 1 January 2026. The package comprises Implementing regulations, and one delegated regulations, in addition to a proposed scope-expansion Regulation.

This update marks the transition from the transitional reporting-only phase (October 2023 – 31 December 2025) to the full compliance regime, in which authorised CBAM declarants must surrender CBAM certificates reflecting the embedded carbon content of their imports.

Carbon costs are no longer a future risk—they are a financial reality today. If you export aluminium, steel, cement, hydrogen, or fertilisers to the EU, proactive CBAM cost modeling is essential to protect your margins and pricing strategy. With default value mark-ups increasing from 10% in 2026 to 30% by 2028, companies that prepare early will be far better positioned to manage the impact.

We help you quantify CBAM certificate costs, analyze pricing scenarios, and navigate free allocation adjustments—transforming regulatory complexity into clear financial insight and a competitive advantage

Background & Regulatory Context

CBAM was established by Regulation (EU) 2023/956 of the European Parliament and of the Council. It applies to imports of cement, iron and steel, aluminium, fertilisers, electricity, and hydrogen. In October 2025, Regulation (EU) 2025/2083 (the "CBAM Simplification Regulation") introduced key structural amendments, including a 50-tonne annual de minimis threshold, simplified authorisation procedures, and a revised certificate surrender timeline (annual CBAM declaration now due 30 September of the following year).

Alongside the December implementing package, the Commission also published on 16 December 2025 a formal review report on CBAM’s transitional phase (October 2023–December 2025), evaluating its effectiveness in addressing carbon leakage, data quality improvements, international impacts, and administrative lessons learned. The conclusions of this report directly informed the scope, methodology, and simplification choices reflected in the definitive package.

The December 2025 Implementing Package by Regulations

1. Methodology for Calculation of Embedded Emissions

Reference: Commission Implementing Regulation (EU) 2025/2547 of 10 December 2025

This act is the "math engine" of the definitive regime. It sets out how third-country producers must monitor and calculate embedded greenhouse gas (GHG) emissions at the installation level, align CBAM system boundaries with those of the EU ETS, and attribute emissions to specific goods. Producers may combine actual values for some precursors with default values for others, providing operational flexibility.

2. Verification Principles

Reference: Commission Implementing Regulation (EU) 2025/2546 of 10 December 2025

This act establishes principles for the independent verification of declared embedded emissions, aiming for rigour while minimising unnecessary administrative burden. Verifiers must be accredited under the separate Delegated Act on Accreditation and Verification. Notably, the initial verification must be conducted on-site.

3. Price of CBAM Certificates

Reference: Commission Implementing Regulation (EU) 2025/2548 of 10 December 2025.

CBAM certificates will go on sale on 1 February 2027 (for the 2026 compliance year). For the 2026 compliance year specifically, certificate prices will reflect the quarterly average of 2026 EU ETS allowance prices. In 2026, the price of CBAM certificates will be calculated as the quarterly average of EU ETS auction clearing prices. Starting in 2027, this will transition to a weekly calculation. This approach ensures a fair, transparent price aligned with the EU carbon market, with the first value expected on Tuesday, 7 April.

4. Default Values for Embedded Emissions

Reference: Commission Implementing Regulation (EU) 2025/2621 of 16 December 2025

Default values are set by Combined Nomenclature (CN) code and country of origin and apply when actual emissions data is unavailable or insufficiently verified. For goods excluding electricity, mark-ups are applied incrementally to bridge the gap between individual installation emissions and country-level averages, incentivising importers to report actual data. For aluminium, steel, cement, and hydrogen, the mark-up follows a progressive schedule: 10% in 2026, 20% in 2027, and 30% from 2028 onwards. Fertilisers are treated differently, with a flat 1% annual mark-up applied across all years. No mark-ups apply to imported electricity. All default values are scheduled for review by December 2027.

5. Calculation of the Free Allocation Adjustment

Reference: Commission Implementing Regulation (EU) 2025/2620 of 16 December 2025

This regulation establishes the methodology for adjusting CBAM certificate obligations to reflect the free allocation of EU ETS allowances still granted to EU producers (phased out 2026–2034). Adjustments may be based on actual data or CBAM benchmarks set out in an accompanying Annex.

6. Information Communicated by Customs Authorities

Reference: Commission Implementing Regulation (EU) 2025/2619 of 16 December 2025

This act specifies what customs authorities must transmit into the CBAM system — data elements, timing, frequency, and secure communication methods — enabling the Commission and Member States to cross-check import declarations against CBAM certificate and emissions reporting. EU data protection principles are embedded throughout.

7. Conditions for Authorised CBAM Declarant Status

Reference: Amending Implementing Regulation (EU) 2025/486, 2025/2549

Reflecting changes introduced by the CBAM Simplification Regulation, the authorisation procedure is simplified by making consultation of other competent authorities voluntary rather than mandatory. Importantly, importers who have applied for authorisation before 31 March 2026 may provisionally continue importing CBAM goods until their application decision takes effect.

8. Definitive CBAM Registry

Reference: Commission Implementing Regulation (EU) 2025/2550 of 10 December 2025 (amending Implementing Regulation (EU) 2024/3210)

The updated registry rules standardise and secure the CBAM Registry for the definitive phase, setting out information exchange protocols between authorised declarants, persons with delegated access rights, customs authorities, competent authorities, verifiers, and the Commission. Provisions for review are included for 2027.

9. Accreditation and Verification of Verifiers (Delegated Act)

Reference: Commission Delegated Regulation (EU) 2025/2551 of 20 November 2025

This delegated act specifies the conditions for granting verifier accreditation, control and oversight of accredited verifiers, and the withdrawal of accreditation. It also establishes a framework for mutual recognition of accreditation bodies across Member States, and provisions for peer evaluation.

Proposal: Scope Expansion to Downstream Goods and Anti-Circumvention measures

Reference: Proposal for a Regulation amending Regulation (EU) 2023/956 — COM(2025) 989

Alongside the implementing package, the Commission published a legislative proposal to amend the base CBAM Regulation. The proposal still requires adoption through the ordinary legislative procedure and is not yet binding. Its key elements include:

Scope extension to downstream products (2028): Around 180 additional CN product categories of steel- and aluminium-intensive manufactured goods, including car parts, domestic appliances (refrigerators, washing machines, etc), construction products, power transformers, cables, farming machinery, and industrial equipment. More than 90% of the affected downstream products relate to industrial supply chains, with household products representing only approximately 6% of categories — limiting the expected consumer price impact.
Anti-circumvention measures: New provisions addressing avoidance risks identified during CBAM's transitional phase. Key measures include: closure of the scrap loophole; granular material composition requirements to prevent misclassification and misreporting; mandatory proof-of-origin obligations for specified carbon-intensive goods; and prohibitions on artificial supply chain restructuring intended to circumvent CBAM obligations.
Electricity import treatment: The proposal reforms CBAM's electricity import rules by replacing fossil-fuel-only default emission values with an average grid emission factor that accounts for renewables, better reflecting third countries' decarbonisation progress. It also simplifies the conditions for declaring actual emission values — notably by removing the network congestion criterion — and clarifies that both physical and indirect Power Purchase Agreements (PPAs) qualify, making low-carbon electricity trade more viable.

Key Compliance Milestones

1 January 2026: Definitive phase begins. Only authorised CBAM declarants may import CBAM-covered goods above the 50-tonne threshold.
Early 2026: The Commission is expected to adopt the implementing act on the methodology for deducting carbon prices effectively paid in third countries — the one component of the definitive package not yet finalised. CBAM benchmarks will also be reviewed and updated in 2026 to align with the final EU ETS benchmarks for 2026–2030, with updated values applicable to goods imported from 1 January 2027.
31 March 2026: Deadline for provisional authorisation applications (allowing importers to continue operating pending a decision).
7 April. First CBAM Certificate pricing published.
1 February 2027: CBAM certificates go on sale for the first time.
30 September 2027: Deadline for first annual CBAM declaration (covering 2026 imports).
December 2027: Planned review of default values and customs communication provisions. The Commission is also required to present its first biennial report to the European Parliament and Council on the implementation of CBAM by 31 December 2027.
2028 (proposed): Extension to downstream steel- and aluminium-intensive goods, subject to legislative process.
1 January 2035: Full CBAM application, coinciding with complete phase-out of EU ETS free allocation in covered sectors.

Practical Implications for Businesses

The December 2025 package closes a critical information gap for businesses preparing for CBAM compliance. Key action points include:

**Authorisation: **Ensure CBAM declarant applications are filed promptly, and leverage the provisional import entitlement through 31 March 2026.
**Emissions data collection: **Engage with third-country suppliers to collect actual embedded emissions data using the confirmed monitoring methodology; assess where default values will apply and what mark-ups will affect certificate costs.
**Verification readiness: **Identify and engage an accredited CBAM verifier, noting new mutual recognition provisions for cross-border supply chains.
**Free allocation adjustment: **Calculate the expected free allocation adjustment, including the special DRI benchmark if relevant to steel supply chains.
**Supply chain review: **Assess exposure to the proposed 2028 scope expansion and begin mapping affected product categories.

Official Document References

All official texts are available on the European Commission's CBAM legislation page and the EUR-Lex Official Journal. Only the Official Journal (printed or electronic edition on EUR-Lex) is legally authentic.

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