# CBAM The Carbon Border Adjustment Mechanism (CBAM) is a policy measure by the European Union designed to reduce greenhouse gas emissions and protect the competitiveness of European companies. CBAM is part of the broader EU Green Deal and aims to create a level playing field by taxing the carbon emissions of imported goods, similar to the carbon costs that EU companies already bear under the EU Emissions Trading System (ETS). [ ESG news ](https://www.meijburg.com/overigen/esg-news) [ ![](https://www.meijburg.com/sites/default/files/styles/hero_banner_wide_f/public/2024-12/CBAM_grote%20banner%20website.png?h=101c275c) ](https://www.meijburg.com/overigen/esg-news) 1. [Home](https://www.meijburg.com/) 2. [Specialism](https://www.meijburg.com/specialism) 3. CBAM ## **Objectives of CBAM** CBAM has several objectives, including: ![Invoering](https://www.meijburg.com/sites/default/files/styles/detail_banner_xl/public/2024-03/co2-grensheffing-2.png) ### Reducing carbon leakage Carbon leakage occurs when companies relocate their production to countries with less stringent climate regulations to avoid the costs of carbon emissions. CBAM aims to counteract this by applying a carbon price to imported goods, thereby reducing the incentive to relocate production. ![Import](https://www.meijburg.com/sites/default/files/styles/detail_banner_xl/public/2024-03/co2-grensheffing-7.png) ### Encouraging global climate action By introducing a carbon price on imported goods, CBAM encourages other countries to take similar climate measures. This can lead to broader acceptance of carbon pricing worldwide. ![Transitie](https://www.meijburg.com/sites/default/files/styles/detail_banner_xl/public/2024-03/co2-grensheffing.png) ### Protecting the EU industry CBAM helps to protect the competitiveness of EU companies by ensuring that imported goods bear the same carbon costs as goods produced within the EU. ## **How does CBAM work?** CBAM works by applying a carbon price to certain imported goods. This process involves several steps: ### Identification of sectors CBAM initially focuses on sectors with a high risk of carbon leakage, such as steel, cement, electricity, fertilizers, and aluminum. ### Calculation of carbon content For each imported good, the carbon content is calculated. This includes the direct and indirect emissions that occurred during the production of the good. ### Application of carbon price A carbon price is applied to the calculated carbon content of the imported good. This price is based on the carbon price within the EU ETS. ### Verification and reporting Importers must report on the carbon content of their goods and the associated costs. These reports are checked by the relevant authorities to ensure compliance. [## Keep informed of important (ESG) tax and legal developments ### Register and receive our newsletters and invitations to events that are relevant to you ](https://www.meijburg.com/keep-me-updated) [ Keep me updated ](https://www.meijburg.com/keep-me-updated) ## **Impact of CBAM on businesses** CBAM has significant implications for both EU companies and companies outside the EU: ![Kosten importeurs](https://www.meijburg.com/sites/default/files/styles/detail_banner_xl/public/2024-12/CBAM_%20kosten%20importeurs_website%20kleine%20banner.png?h=8e07c230) ## Costs for importers Importers of goods subject to CBAM will have to bear additional costs in the form of carbon levies. This can increase the prices of imported goods. ![Concurrentiepositie](https://www.meijburg.com/sites/default/files/styles/detail_banner_xl/public/2024-12/CBAM_%20Concurrentiepositie%20EU-bedrijven_website%20kleine%20banner.png?h=2d8306b1) ## Competitiveness of EU companies By creating a level playing field, CBAM can improve the competitiveness of EU companies, as they are no longer disadvantaged by stricter climate regulations. ![Duurzame productie](https://www.meijburg.com/sites/default/files/styles/detail_banner_xl/public/2024-12/CBAM_%20Stimulans%20voor%20duurzame%20productie_website%20kleine%20banner.png?h=d0662326) ## Incentive for sustainable production CBAM can encourage companies worldwide to adopt more sustainable production methods to reduce carbon costs and maintain competitive advantage. ## **Need fiscal advice on CBAM?** The CBAM specialists are also happy to assist you with this. We can take the following matters off your hands: 1. Determine the impact of CBAM; 2. Analyze the quality and availability of required (emission) data; 3. Support in collecting (emission) data from suppliers; 4. Support in submitting CBAM reports; 5. Advice on setting up governance; 6. Prepare for registration as an authorized declarant and the financial period from 2026. Our advisors are ready for you. If you want to know more about the implications of the CBAM for your business, do not hesitate to [contact one of our specialists](https://www.meijburg.com/specialism/esg-tax-sustainability/contact-us). ## Links & Downloads - [Carbon Border Adjustment Mechanism (CBAM)](https://kpmg.com/xx/en/our-insights/esg/carbon-border-adjustment-mechanism-cbam.html) - [Regulating carbon markets](https://kpmg.com/xx/en/our-insights/regulatory-insights/regulating-carbon-markets.html) - [Delivering The European Green Deal](https://commission.europa.eu/strategy-and-policy/priorities-2019-2024/european-green-deal/delivering-european-green-deal_en) ## Frequently asked questions ### What is the implementation timeline for CBAM? The first phase began in October 2023 and includes a reporting period without financial obligations. Starting in 2026, the financial obligations will be fully enforced. ### Which sectors are covered by CBAM? In the initial phase, CBAM focuses on sectors such as steel, cement, electricity, fertilizers, and aluminum. It is expected that more sectors will be added in the future. ### How can companies prepare for CBAM? Companies can prepare by reducing their carbon footprint, implementing transparent reporting systems, and becoming aware of the CBAM requirements applicable to their sector. ## CBAM specialists [ ![Merijn Betjes](https://www.meijburg.com/sites/default/files/styles/person_search_result/public/2022-07/Merijn%20Betjes%20profiel.jpg) ](https://www.meijburg.com/about-us/our-people/merijn-betjes) [ Merijn Betjes ](https://www.meijburg.com/about-us/our-people/merijn-betjes) Partner betjes.merijn \[at\] kpmg.com [ Meijburg Amstelveen ](https://www.meijburg.com/keep-me-updated/contact-offices/meijburg-amstelveen) - [ ![Linkedin](https://www.meijburg.com/themes/custom/openworld/static/images/icon_linkedin.svg) ](https://www.linkedin.com/shareArticle?mini=true&url=https://www.meijburg.com/markdownify/node/2153&title=CBAM&source=https://www.meijburg.com/markdownify/node/2153 "Linkedin") - [ ![Email](https://www.meijburg.com/themes/custom/openworld/static/images/icon_email.svg) ](mailto:?subject=CBAM&body=Check out this site https://www.meijburg.com/markdownify/node/2153 "Email") - [ ![Print](https://www.meijburg.com/themes/custom/openworld/static/images/icon_print.svg) ](# "Print") - [ ![whatsapp](https://www.meijburg.com/themes/custom/openworld/static/images/icon_whatsapp.svg) ](https://wa.me/?text=https://www.meijburg.com/markdownify/node/2153 "whatsapp")