EU Simplifies CBAM Rules with 50-Ton Importer Threshold, Effective September 2025

The EU Council Presidency and European Parliament negotiators have reached a provisional agreement to streamline the Carbon Border Adjustment Mechanism (CBAM), a cornerstone of the bloc's climate policy. The reforms, part of the Omnibus I legislative package proposed on February 26, 2025, aim to reduce administrative burdens while maintaining climate ambitions-covering 99% of embedded emissions from iron, steel, aluminum, cement, and fertilizer imports.

Key Reforms: 50-Ton Importer Exemption

1. Threshold for SMEs:

- Importers bringing in ≤50 tons annually of CBAM-covered goods will be exempt from obligations, replacing the previous de minimis value-based exemption.

- Impact: 90% of small importers (mainly SMEs and individuals) relieved from compliance costs.

2. Transitional Flexibility:

- Importers can continue shipments during CBAM registration pending approval in early 2026.

3. Broader Simplifications:

- Streamlined authorization for declarants

- Simplified emission data collection and calculation

- Clearer carbon price recognition for payments made in third countries

- Enhanced anti-circumvention measures

- Defined financial responsibilities for CBAM declarants

Next Steps

- The provisional agreement requires formal adoption by the Council and Parliament, with expected enactment by September 2025 (effective three days after Official Journal publication).

- The European Commission will conduct a full review in early 2026, potentially expanding CBAM to other ETS sectors and addressing carbon leakage risks for EU exporters.

CBAM, adopted in 2023 and effective 2026, aligns carbon costs for imports with the EU Emissions Trading System (ETS) to prevent carbon leakage. Importers must purchase CBAM certificates to cover emission differentials.