What does CBAM mean for steel imports?
CBAM affects the import of steel from non-EU countries
CBAM — the Carbon Border Adjustment Mechanism — means that anyone importing steel and iron from outside the EU incurs obligations concerning the CO2 emissions released during the production of that steel. It is a European regulation that applies the carbon price that EU producers pay through the emissions trading system (ETS) also to comparable products entering from outside the EU. For steel and iron, this concretely means: first reporting on the embedded emissions of the imported product, and from the definitive phase onwards also settling financially via CBAM certificates. The regulation therefore does not affect manufacturing within the EU, but specifically the import of steel and iron from outside the EU customs border.
Who it applies to, and which steel it does not
CBAM applies to those importing goods listed in Annex I of Regulation (EU) 2023/956 into the customs territory of the EU — for steel and iron this concerns a range of products, from raw materials and semi-finished products to certain finished articles; the full list with customs codes is in that annex. It thus primarily affects importers, and less so parties trading or processing steel within the EU after it has already been imported. Exempted are goods originating from countries that themselves participate in the EU ETS or have a linked emissions trading system, such as Iceland, Liechtenstein, Norway and Switzerland (Article 2 of the regulation). Consignments of negligible value are also excluded from the regulation. What CBAM does not do: it does not replace customs formalities, it says nothing about product safety or material quality, and it is a different instrument from the digital product passport — CBAM concerns the carbon footprint of imports, not data on origin or materials for the entire life cycle of the product.
From 2026 onwards, the mandatory purchase of certificates follows
Since 1 October 2023, a transition period has been running in which only a reporting obligation applies: anyone importing goods falling under Annex I reports the embedded emissions quarterly, without a corresponding financial payment. That transition period runs until 31 December 2025. From 1 January 2026, the definitive system takes effect: then the import of the relevant goods is restricted to registered "authorised CBAM declarants", and the obligation is added to make an annual CBAM declaration and to purchase and surrender certificates corresponding to the embedded emissions (Article 36 of the regulation). Until that date, it therefore remains at reporting; the financial side starts with the transition to the definitive system.
What this means for import practice
Anyone importing steel or iron falling under Annex I would be well advised first to check whether their own product codes actually appear in that annex — not every steel product falls under it, and the classification runs via customs codes, not via a general description. It is then important to know whether the emissions data of the foreign producer is already available, as that data forms the basis of the reporting and later of the certificate obligation; without figures from the manufacturer or exporter, reporting is difficult. For the period from 2026 onwards, the status of authorised CBAM declarant is a prerequisite for being allowed to import the relevant goods, which requires an application to the competent authority well before the definitive obligations come into force (Articles 4 onwards of the regulation). Finally, it is useful to follow whether the country of origin has its own carbon price, because an already paid carbon price can be deducted from the CBAM obligation.
The basis: Regulation (EU) 2023/956
This explanation follows directly from Regulation (EU) 2023/956 establishing a Carbon Border Adjustment Mechanism. The scope — which goods, including iron and steel — is set out in Article 2 and Annex I; the exception for certain third countries is also in Article 2; the obligation to register as an authorised CBAM declarant is set out in Article 4 and the articles that follow; and the transition from the reporting period to the definitive system with certificates is set out in Article 36.
If you are already importing steel that falls under Annex I of this regulation, it is best to start by checking your own customs codes against that annex and requesting emissions data from your supplier, so that quarterly reporting during the transitional period is in order and the application for authorised CBAM declarant status can be prepared in time before the definitive system enters into force. The full and up-to-date text of the regulation, including Annex I with the product codes, is available at the source indicated under this article.
What this is based on
The regulation itself can be found on EUR-Lex. We provide references for each statement; you do not have to take our word for it.
What you must concretely do
What is expected of you
CBAM (Regulation (EU) 2023/956) primarily affects companies that import steel from outside the EU. Those who only trade or process within the EU will notice it indirectly — through a supplier's or customer's question — but the obligations themselves lie with the importer.
Check whether your products fall under CBAM
Pig iron, steel and many semifinished products thereof are listed on the goods list of the regulation. For a company with 10 to 100 employees that purchases steel outside the EU, this means in practice: checking per commodity code whether it appears on the list. This is not a matter of estimation, but of comparing your own procurement list against the annex to the regulation. If a company has not done this internally, it effectively does not know whether a reporting obligation applies.
Collect data on imported tonnages and emissions
For CBAM-liable imports, records are kept of how much material has been imported and which greenhouse gas emissions are associated with it — directly from production and, where applicable, indirectly via energy consumption. This data typically comes from the producer outside the EU, not from an internal measurement. For a trading company, this means the relationship with the foreign supplier changes: an emissions figure per tonne is now required, whereas previously only a price and a certificate mattered. This figure is often determined differently than the CO2 values that appear in a European product passport, and it is therefore a separate exercise — see for that comparison how CO2 emissions per tonne of steel are demonstrated.
Report via the designated system
The regulation provides for a reporting obligation for CBAM declarants, with a transitional period in which data is primarily collected and reported before financial obligations are added. For a mid-sized company, this means that someone — internally or a customs agent — actually submits the report, and the underlying data per consignment is traceable and substantiated. This is not a one-off action but a recurring cycle, linked to imports.
Substantiate emissions data towards your own chain
Where an importer passes on emissions figures from a foreign producer, this implicitly also raises questions about whether those figures are correct and on what methodology they are based. This is a different issue than determining internally according to which methodology the values for the passport are measured, but the two subjects are related: an importer who will soon also fall under ESPR obligations for the steel product passport would do well to organize the same source data for both purposes instead of asking twice separately.
Where things go wrong in practice
The commodity code is not checked against the CBAM list. A company assumes that "simply purchasing steel" falls outside the scheme, while the specific code is actually on the list. This occurs especially with semifinished products and processed products, where the classification is less straightforward than with raw steel.
The foreign supplier does not provide (usable) emissions data. Especially smaller producers outside the EU do not have this data readily available as standard, or provide a figure without substantiation. The importer is then left with a reporting obligation for which the underlying data are missing.
Emissions data and passport data are kept separately. Companies that both do CBAM reporting and will soon have to compile a product passport often build two separate files with partly the same questions about origin. This costs double work and creates double risk of inconsistency.
No distinction is made between scrap-based and ore-based production. Because the emissions intensity of steel varies greatly by production route, failing to document this distinction results in an emissions figure that does not match the actual origin of the material. This also touches on the question how the scrap content in the melt is recorded, which is relevant for the emissions assessment.
The reporting obligation is assigned to one person without a substitute. In companies of this size, CBAM reporting is often the work of one purchaser or controller. If that person leaves or there is staff turnover, a gap emerges in the reporting cycle, while the obligation continues.
What you can document
- An overview of commodity codes which the company imports, with a note per code indicating whether it appears on the CBAM goods list.
- A fixed format for emissions data per supplier, so that each foreign producer supplies the same data in the same form — this prevents each shipment from becoming a separate research task.
- Correspondence with the supplier about the production route used (ore or scrap), as substantiation for the emissions figure.
- An internal responsible person with a substitute for periodic reporting, documented in a job description or work instruction.
- A link between CBAM file and product passport file for material that falls under both regulations, so that source data is not requested separately twice. Also consider the question which data will be included in the steel product passport, so that data already collected for CBAM does not have to be requested from the supplier again later.
- A log of imported tonnages per quarter, as a basis for periodic reporting and as a control measure for discrepancies.
This documentation is not an end in itself, but prevents the reporting obligation from being filled in from scratch with each shipment.
This is not legal advice. This page provides general information about the legislation that this platform deals with. We do not know your situation. If you are in doubt about your own case, consult a lawyer or the competent supervisory authority.
Written with AI based on the sources above, checked by a human on 2026-08-22. Is something not right? Let us know — corrections are given priority.