CBAM Reform: Simplifications for Importers

03 March 2025

The European Commission has published its proposal for simplifying the Carbon Border Adjustment Mechanism (CBAM), introduced by Regulation (EU) 2023/956, a flagship measure of its Green Deal. This proposal, set up in Working Document SWD(2025) 58, remains to be adopted by the European Parliament and the Council before entering into force. Until its adoption, the obligations set out in the original CBAM regulation, including quarterly reporting, remain fully applicable.

The primary objective of this reform is to reduce the reporting obligations for importers while ensuring more effective monitoring of the carbon emissions associated with products imported into the EU. This initiative is part of a broader effort to simplify administrative procedures and improve business competitiveness, which also encompasses the Corporate Sustainability Reporting Directive (CSRD), the Corporate Sustainability Due Diligence Directive (CS3D), and the EU Deforestation Regulation (EUDR).

1. A simplification of reporting obligations for importers

The new proposal introduces exemption thresholds designed to exclude low-volume importers of ‘CBAM products’ from reporting obligations.

The new project introduces an exemption threshold aimed at excluding low-volume importers of goods covered by the MACF from their reporting obligations. This threshold is based on a mass approach set at 50 tonnes per year, corresponding on average to approximately 80 to 100 tonnes of CO₂ equivalent emissions embedded in the imported products.

Importers meeting either of these thresholds will be exempted from CBAM reporting obligations.

This reform is expected to significantly reduce the administrative burden on many importers while ensuring that 99% of emissions remain covered by CBAM. Supervising authorities will monitor imported volumes in real time to promptly identify entities exceeding these thresholds, which will remain liable for any breaches.

2. A Timeline Better Aligned with Business Needs

The proposal also includes significant adjustments to the declaration and payment deadlines:

The deadline for submitting annual MACF declarations is postponed from May 31 to August 31, thus providing importers with an additional three months to collect and process their data.
The postponement of the declaration submission also shifts the other associated deadlines: the certificate repurchase deadline is set to September 30, and the cancellation of certificates will occur on October 1.
Companies will not be required to purchase MACF certificates until February 2027, more than a year after the originally planned date.

3. A More Flexible Approach to CBAM Certificate Payments

The requirement for importers to permanently hold at least 80% of the certificates corresponding to their estimated emissions will be reduced to 50%, thereby lessening financial constraints.

4. Standardization of Default Values

The Commission will establish a standardized carbon value system, enabling companies to use default values without requiring individual verification. Earlier this year, sources from French DGEC (Directorate General for Energy and Climate) and other government agencies informed that the use of these default values would likely be subject to an upward mark-up, in order to encourage importers to opt for verified real values. The proposal remains silent on this aspect.

Additionally, importers will now be able to deduct carbon taxes paid in any country involved in their supply chain, instead of being restricted to the country of origin of the goods.

5. Eased Emissions Verification Requirements

The reform introduces measures aimed at simplifying emissions reporting:

Finishing operations (e.g., anodization, galvanization) will be excluded from embedded emissions calculations.
Emissions from materials produced within the EU but processed outside the EU will no longer need to be factored into the emissions calculations for finished products imported into the EU.
Only calculations based on real values will require third-party verification, whereas default values provided by the Commission will no longer necessitate an external audit.

6. Enhanced Governance and Strengthened Oversight

Alongside these simplifications, the Commission is reinforcing CBAM monitoring mechanisms:

The introduction of a centralized CBAM registry will allow for improved tracking of imports and compliance with reporting obligations.
The Commission will have the authority to impose penalties that are proportionate to the severity and recurrence of infractions.
Anti-evasion measures will be introduced, particularly to counteract the artificial fragmentation of imports intended to circumvent exemption thresholds.

The European Parliament and the Council will now bear the responsibility of examining and approving these modifications in the coming months. Meanwhile, importers are encouraged to assess their supply chain flows (volumes, traceability) in light of these new simplification criteria.

Until these measures are formally adopted, the existing quarterly reporting schedule and related obligations remain unchanged, even for importers who may eventually qualify for the new exemption thresholds once they officially take effect.