EU Council, Parliament strike deal on simplification of CBAM
The European Council presidency and European Parliament's negotiators reached a provisional agreement yesterday on one of the proposals of the so-called 'Omnibus I' legislative package: a regulation that simplifies and strengthens the European Union's (EU) carbon border adjustment mechanism (CBAM).
The CBAM is the EU's tool to equalise the price of carbon paid for EU products operating under the EU emissions trading system (ETS) with that of imported goods, and to encourage greater climate ambition in non-EU countries.
The European Council and Parliament have reached a provisional pact on an 'Omnibus I' legislative package proposal: a regulation that simplifies and strengthens the EU carbon border adjustment mechanism (CBAM). New de minimis mass threshold of 50 tonnes will exempt 90 per cent of importers from CBAM rules. CBAM's climate goals have not been compromised. Import procedures will also be simplified.
The proposal seeks to provide simplification and cost-efficient compliance improvements to the CBAM regulation, without compromising its climate goals, as about 99 per cent of embedded emissions in the imported CBAM goods would remain covered.
The overall aim is to reduce the regulatory and administrative burden, as well as compliance costs for EU companies, especially small and medium enterprises (SMEs), according to a release from the Council.
Co-legislators supported a new de minimis mass threshold, whereby imports up to 50 tonnes per importer per year will not be subject to CBAM rules. It replaces the current threshold exempting goods of negligible value.
The new threshold exempts the vast majority (90 per cent) of importers—mainly SMEs and individuals—who import only small quantities of CBAM goods.
Co-legislators also agreed on changes to simplify imports covered by the CBAM such as the authorisation process, the calculation of emissions and verification rules as well as the financial liability of authorised CBAM declarants, while strengthening anti-abuse provisions.
The deal has still to be endorsed by both the European Parliament and Council. It will enter into force three days after publication in the EU Official Journal.
In early 2026, the Commission will assess whether to extend the scope of the CBAM to other ETS sectors and how to help exporters of CBAM products at risk of carbon leakage.
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