What is CBAM and how does it affect my exports to the EU?

Key takeaways

• CBAM covers cement, iron and steel, aluminium, fertilisers, electricity and hydrogen imported into the EU. It does not cover finished goods made from those materials.
• The transitional phase ran October 2023 to 31 December 2025. Its quarterly reports ended with it. The definitive phase has been running since 1 January 2026. This is not a future problem.
• Verification by an EU-accredited verifier is a definitive-phase requirement, so it is already in force. Your buyer cannot use unverified data.
• The EU importer carries every filing obligation. You cannot file a CBAM declaration; you supply the emissions figures your buyer files.
• Without your verified figures the importer falls back on default values set above typical Indian carbon intensity, which raises their landed cost and puts the order at risk.
• Certificate sale and surrender dates, and the declaration calendar, were postponed and are not stated here. Confirm them on the European Commission's CBAM pages before pricing a contract.

Which goods and which exporters does CBAM cover?

CBAM covers six product categories: cement, iron and steel, aluminium, fertilisers, electricity, and organic chemicals. The mechanism applies to:

• Any importer of CBAM goods into the EU (UK not included; Norway and Switzerland exempt)
• Large exporters first (Phase 1: Oct 2023. Dec 2025 was reporting-only; Phase 2: Jan 2026+ enforces duty)
• Indirect emissions count: embedded carbon in imported inputs (e.g., electricity used to make steel) also applies

If you export steel, aluminium, fertiliser, or cement to the EU, your customer (the importer) faces CBAM liability on your shipment. This means:

• You may need to declare the carbon intensity of your goods on the commercial invoice or packing list
• Your competitiveness against EU-produced goods shrinks if you do not have verified emissions data
• Your customer's landed cost increases by the CBAM price adjustment (currently ≈€0. 50/tonne depending on EU carbon price)

What emissions data do I need and who verifies it?

The EU requires two forms of emissions declaration:

1. Self-declared emissions (Oct 2023. 31 Dec 2025, now closed): During the transitional phase importers declared carbon intensity from supplier data (yours), and no third-party verification was required. This route is no longer open.
2. Verified emissions (definitive phase, since 1 Jan 2026): Importers must use verification reports from EU-accredited verifiers. These verifiers assess your facility's emissions and issue a report recognised by the EU CBAM Registry. If you are still supplying self-declared figures, you are supplying something your buyer cannot file.

What this means for you: As an Indian exporter, you must collect or calculate:

• Direct emissions (Scope 1): Your production facility's fuel use and on-site process emissions
• Indirect emissions (Scope 2): Electricity purchased from the grid used in your production
• Optional (Scope 3): Upstream supplier emissions if you use imported inputs (rare for CBAM, but emerging)

An EU-accredited verifier audits your emissions data and issues a certification report. The verifier must be accredited under an EU member state's national accreditation body or an equivalent standard the EU recognises. An ISO 14064 consultant who is not EU-accredited can prepare your baseline but cannot produce the report your buyer files. Bureau Veritas, SGS, TÜV, DNV and Dekra operate in India.

What are the key dates and registrations I need to track?

How does CBAM affect my pricing and competitiveness?

CBAM is a carbon price. The EU auctions ETS (Emissions Trading Scheme) allowances; the CBAM charge is pegged to that price. This page does not quote a current carbon price. The ETS price moves daily and the CBAM certificate price is set separately from it, so any figure printed here would be stale before you read it. Get the live ETS price and the applicable CBAM certificate price from the European Commission's CBAM pages, then do the arithmetic below with today's number.

The shape of the exposure, which does not move:

• Your CBAM cost per tonne of steel = (your verified tonnes CO₂ per tonne) × (carbon price per tonne CO₂)
• So the only input you control is your own carbon intensity, and it is the one your buyer cannot look up without you
• The worked example below runs this arithmetic end to end for an electric-arc mill measured at 0.9 tonnes CO₂ per tonne

What this means: If you export mid-range carbon-intensive goods (e.g., primary steel, portland cement), your margin compresses. EU producers face the same carbon cost but recover it through the ETS rebate mechanism; you do not. Over time, CBAM may shift demand toward lower-carbon suppliers or trigger technology investments in your facility.

Do I need to register anywhere or notify anyone?

Directly: No. Indian exporters do not register in the EU CBAM Registry; the importer does. However, you must:

• Provide embedded emissions data to your buyer. Direct (Scope 1) and indirect (Scope 2), per tonne of product. Your buyer needs it now, not at some future date
• Cooperate with EU verifiers who may audit your facility or demand production records to certify emissions
• Notify your AD bank (if applicable) of CBAM declarations on the commercial invoice

Indirectly: Your EU customer must hold authorisation as a CBAM declarant to import covered goods in the definitive phase. This page does not state the registration deadline or the declaration frequency. The quarterly cadence belonged to the transitional phase and ended with it, and the definitive-phase calendar has moved during implementation. Ask your buyer for their declarant authorisation status rather than working from a date. If you are also an importer (e.g. Buying EU goods to re-export), you face registration separately.

What if my emissions are not verified?

Your goods are not stopped at the border for want of an emissions figure. CBAM is a charge, not a prohibition, and this page previously said otherwise. What happens instead is that the cost of not having your number falls on your buyer, and then on you. Their options:

• Halt shipments until verification is complete (delay risk for time-sensitive orders)
• Use default values. The fallback carbon intensity applied when verified data is absent. It is set conservatively, meaning against you. This page does not state the current default figures; get them from the Commission before you assume the gap is small
• Switch suppliers to competitors with verified data (loss of order)

Recommendation: Start the emissions audit now, and treat it as late rather than early. Engage an international certification body (SGS, Dekra, TÜV, Bureau Veritas, DNV) for a baseline assessment, then an EU-accredited verifier for the report itself. The obligation your buyer is carrying started in January 2026, so there is no remaining preparation window to plan against. Only a gap to close.

Which products are in and which are out?

CBAM covers six categories today, and the scope is legislated to widen. This page does not put a date on the expansion. Current scope:

• Cement (HS 2523): All portland cement and clinker
• Steel (HS 72): Iron and steel products (not stainless; not secondary/scrap)
• Aluminium (HS 76): Primary aluminium and ingots
• Fertilisers (HS 3104. 3105): Nitrogenous, phosphatic, potassic fertilisers
• Electricity (HS 2716): Imported electricity (rare for India)
• Organic Chemicals (HS 29): Subset of bulk chemicals (ammonia, methanol, etc.)

Products NOT covered: finished goods containing CBAM materials (e.g., a car with steel, a machine with aluminium) are NOT subject to CBAM; only the primary material is. Processed steel (e.g., stainless, galvanised) falls outside HS 72 and is not covered. Recycled steel and scrap are exempt.

How do I prepare now?

Do first, in this order:

1. Ask your buyer what they are currently filing. They are in the definitive phase and are declaring a number for your goods today. If they have not asked you for it, they are using a default value against you and you should find out which one.
2. Audit your emissions baseline: Engage an ISO 14064-certified consultant or auditor to quantify Scope 1 (fuel) and Scope 2 (electricity) emissions from your facility.
3. Collect energy data: Request consumption records (electricity bills, fuel invoices, production logs) for 2024 and 2025.
4. Engage an EU-accredited verifier, not only an ISO 14064 consultant. The consultant produces your baseline; only an accredited verifier produces the report your buyer can file.
5. Budget for verification: EU verifier audit ≈€3,000. 10,000 depending on facility size and complexity.

Then keep it current. Embed emissions measurement in your compliance system and re-verify on the cycle your verifier sets, so the figure your buyer files is never the one you measured two production years ago. Track carbon intensity improvements: under a charge pegged to emissions, a lower number is a price advantage over the mill next door.

A Jaipur secondary steel mill (SAIL/Tata/JSW-scale) producing rebar exports 100 tonnes monthly to a German steel distributor. The facility uses electric arc furnaces (EAF) with 500 kW grid power per tonne of output. </> } result={ <>

Baseline emissions (estimated):

• Direct (fuel): 0.5 tonnes CO₂/tonne
• Indirect (electricity at 0.8 kg CO₂/kWh India grid): 0.4 tonnes CO₂/tonne
• Total: 0.9 tonnes CO₂/tonne

CBAM cost to buyer, worked at an illustrative &euro;70/tonne CO&#8322;. Substitute today's price:

• &euro;63 per tonne of steel (0.9 &times; &euro;70)
• &euro;6,300/month on a 100-tonne shipment
• Against a &euro;200/tonne margin that is 31% of the buyer's net. And it is the verified 0.9 that gets them there. Unverified, they file a default and pay on a number you did not earn.

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Action: Audit your actual emissions now (range 0.6. 1.2 depending on efficiency, fuel mix, and electricity source), then get the figure verified by an EU-accredited verifier. When your German buyer files, they declare your verified 0.9. Without it they fall back on a default value. This page does not state what that default is (get it from the Commission) but it is set deliberately above typical intensity, so every step it sits above your real 0.9 multiplies straight through the formula above into your buyer's landed cost. That gap, not the verification fee, is what makes the audit pay for itself.

Which other EU rules hit the same shipment?

CBAM is one of several EU regimes that attach to an Indian consignment independently of tariff. A shipment can clear CBAM and still be stopped by any of these:

• REACH for Indian exporters. Chemical registration duties when the manufacturer sits outside the EU.
• CE marking from India. Conformity routes and the technical file behind the mark.
• EUDR deforestation rules. Plot geolocation data the EU buyer needs for leather and derived goods.
• GPSR and the EU Responsible Person. The named EU-based person every consumer product now needs.
• IOSS and EU VAT. The VAT leg that runs alongside the carbon leg on the same parcel.

References and resources

• EU CBAM Regulation (EU) 2023/956: Full text (eur-lex.europa.eu)
• EU CBAM Guidance on Verifiers (Aug 2024): European Commission announcement
• EU CBAM Registry: cbam.ec.europa.eu. Your EU buyer's declarant authorisation and declarations live here. You do not register.
• ISO 14064 Emissions Assessment: Engage a consultant certified under this standard to measure your facility's baseline.
• International Verifiers: SGS, Dekra, TÜV, Bureau Veritas, Kiwa offer CBAM verification services.

Last updated: 2026-09-03. CBAM regulations are evolving; consult the EU EU Taxation & Customs page for updates.

Update history

• 2026-08-25 First published.