What is CBAM?
CBAM is an environmental policy instrument being introduced by the EU. It is essentially a carbon tax on imports, and its aim is to help the EU decarbonise and reach its climate goals. EU producers in certain carbon-intensive industries now have to pay a carbon price under the Emissions Trading Scheme (ETS). CBAM works in tandem with this to avoid “carbon leakage”- the relocation of production outside the EU to countries with less ambitions decarbonisation policies.
Since 1 January 2026, importers of goods covered by CBAM are incurring the cost of this carbon tax. It is essential for importers to take steps to get clarity on the costs they are incurring.
Timelines and parties involved
To allow all parties to adjust to the new requirements, CBAM has been introduced on a phased basis. The Transitional Period, which ended on 31 December 2025, was largely about learning and data gathering. It ran for over two years, and the primary obligation for importers of goods covered by the regulations was to file quarterly CBAM reports.
The full Implementation Period began on 1 January 2026. CBAM costs are incurred on all imports from then, and importers wont be able to import CBAM goods if they are not an authorised importer. CBAM certificates for 2026 will need to be purchased and surrendered by September 2027.
Sectors covered in the initial phase of CBAM
Cement
Iron & Steel
Aluminium
Fertilisers
Electricity
Hydrogen
Ultimately CBAM will cover embedded carbon emissions across a broad range of products. But the initial scope will focus on the above carbon intensive industries. Companies with goods within the scope of CBAM need to get clarity on the CBAM data and the methodology for calculating the cost.
Here is a full list of goods covered by CBAM – SwiftFile-CBAM-goods-list
CBAM is being rolled out by the European Commission (EC). The Environmental Protection Agency (EPA) is the competent body in Ireland. The Revenue Commissioners will provide the EC and EPA with customs data, so the regulators have a clear picture of what CBAM goods are being imported and by who.
Reporting & Cost Calculation
Embedded emissions must be reported on for all CBAM goods, which means there is a considerable amount of data that needs to be collected. The importer of the goods is responsible for the reporting. The reporting obligation was quarterly in the Transitional Phase, although it is now done on an annual basis. The big difference now is that an importers annual CBAM declaration must now be independently verified.
Despite the Implementation Period having already started, there is still a lot of uncertainty about how the cost of CBAM certs are calculated. Although, CBAM certs for 2026 won’t actually be purchased until 2027, businesses should be accruing for the CBAM costs in their 2026 accounts. Clarity on CBAM costs is also hugely important for customer pricing and other decision making. CBAM is here to stay, and businesses affected should be looking to get clear understanding of the moving parts.
How SwiftFile can help
The introduction of new regulations invariably present challenges to those businesses affected by them. The CBAM calculations are particularly complex, and importers of steel, cement and fertilisers are at the sharp end. SwiftFile can help businesses get clarity on this new requirement. We are helping importers get on top of CBAM by advising on:
- the key concepts, and which goods are covered
- the data required and how to report
- how to get authorised as an importer, and
- the approach to take to estimate CBAM costs
For a discussion on how we can help your business, please get in touch.