Commission Implementing Regulation (EU) 2023/1773 laying down the rules for the application of Regulation (EU) 2023/956

The Carbon Border Adjustment Mechanism (CBAM) is an EU policy that charges importers for the carbon emissions embedded in certain high-emission goods, ensuring fair competition and encouraging lower-carbon production abroad.

Carbon Border Adjustment Mechanism

Laws and Policies

CCLW

CCLW national policies

Published

<p>Commission Implementing Regulation (EU) 2023/1773, adopted on 17 August 2023, lays down the detailed reporting rules for the Carbon Border Adjustment Mechanism (CBAM) during its transitional period, running from 1 October 2023 to 31 December 2025. It defines the obligations of “reporting declarants” — typically importers or their customs representatives — who must submit quarterly reports on the quantity and type of goods imported, their country of origin, and the emissions embedded in their production. The Regulation specifies the calculation methods for both direct and indirect emissions, aligning them with methodologies used under the EU Emissions Trading System.</p>

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An aim to achieve a quantifiable outcome within a given time-frame, set by an institution such as a national government.

Policy instruments are techniques or tools used by governing authorities to promote certain policies in order to achieve predetermined goals. Put simply, instruments are how a government tries to achieve its goals, with this taxonomy being focused on national policy instruments.

Risk is the potential for adverse consequences resulting from the dynamic interplay between (climate-related) hazards, exposure, and vulnerability of affected human or ecological systems.

Groups  of people who are adversely affected by climate change or the response to it

A set of principles, processes, and practices that build economic and political power to shift from an extractive economy to a regenerative economy.

Renewable energy means all forms of energy produced from renewable sources in a sustainable manner.

Fossil fuel is a generic term for non-renewable energy sources such as coal, fossil gas, and oil (including crude oil, and petroleum products), that can be used for electricity and heat generation. Fossil fuels are hydrocarbons formed from pressurised and heated organic material buried over millions of years.

Molecules in the atmosphere that play a key role in the greenhouse effect by trapping heat radiating from Earth’s surface.

Area of the economy in which actors engage in identical or related activities.

In human systems, the process of adjustment to actual or expected climate change and its effects, in order to moderate harm, increase resilience or exploit beneficial opportunities. In natural systems, the process of adjustment to actual climate change and its effects; human intervention may facilitate adjustment to expected climate change and its effects.

The management and allocation of funds, assets and investments to meet various objectives

This sector involves the wholesale and retail selling of goods.

A long-lived, colourless gas, chiefly emitted from fossil fuel combustion, deforestation and cement production.

Any compulsory, unrequited payment to the government levied on corporations or individuals. This can be for environmental reasons, such as introducing a Carbon tax to set a price that emitters must pay for the greenhouse gases they emit.

Tradable permits are market-based tools that grant permission for specific activities, frequently used to regulate emissions. These permits can be issued within a trading system to manage environmental impacts.

This sector includes firms and individuals offering specialised expertise in fields such as law, accounting, consulting, science and engineering.

Energy derived from biological compounds that are renewable due to their short life cycle within the carbon dioxide cycle.

Activities involving the catching, processing, and selling of fish for food, recreation, and industry.

The activities of industries that transforms raw materials into finished goods through industrial processes.

Actions to adapt human health, healthcare systems and well-being to climate change.

The activities of industries involved in the production, distribution, and sale of energy, including electricity, gas, and renewables.

Activities of industries that extract natural resources, such as mining, oil, and gas, for commercial use.

Oil is a combustible liquid fossil fuel composed mainly of hydrocarbons, occurring as crude oil and refined into petroleum products such as petrol, diesel and kerosene.

Actions or measures to adapt freshwater systems to climate change.

The release of heat-trapping gases, primarily from human activities such as burning fossil fuels, agriculture and industry.

A financial institution that manages a country's currency and can promote climate-related initiatives through green monetary policy and other means.

This sector involves managing waste treatment, sanitation, pollution control and environmental cleanup.

Any substance with chemical properties that can cause physical harm to people or damage the environment, including ammonia, carbon monoxide, phosphine, chlorine, arsenic, cadmium, mercury, pesticides, dioxins, microplastics, benzene, asbestos, aflatoxins, fluoride, methanol, and toxins from marine sources.

Slow onset events evolve gradually from incremental changes over many years or from increased frequency or intensity of recurring events. As defined in the Cancun Adaptation Framework (2010), slow onset events include risks and impacts from rising temperatures, desertification, biodiversity loss, land and forest degradation, glacial retreat, ocean acidification, sea level rise, and salinization.

Activities that involve the cultivation of crops and raising of livestock for food, fibre, and other products essential for human life and industry.

Coal is a combustible sedimentary rock formed from carbonised plant matter, rich in carbon and hydrocarbons, and occurring in several main types including hard coal and brown coal.

Either money or something of monetary value is transferred between two or more organisations, people or countries.

Activities that involve planning, designing and building infrastructure, residential, and commercial structures.

This sector involves the distribution, treatment, and conservation of water resources.

This sector provides communication services, software development, and IT solutions.

Actions or measures to adapt freshwater, coastal and marine systems to climate change.

A potent, short-lived greehouse gas, largely released from livestock, fossil fuel extraction and waste management.

This sector involves activities to move goods and people, alongside the storage of products.

The processes through which enterprises can identify, prevent, mitigate and account for how they address their actual and potential adverse impacts. Due diligence is the idea that reasonable precautions should be taken to avoid causing harm to people, the environment, or society. It also involves identifying and mitigating risks before they occur.

Fossil gas, commonly known as natural gas, is a fossil fuel consisting chiefly of methane with smaller amounts of other hydrocarbons and trace gases, found in underground deposits.

Commission Implementing Regulation (EU) 2023/1773 laying down the rules for the application of Regulation (EU) 2023/956

Policy instrument

Risk

Renewable energy

Fossil fuel

Greenhouse gas

Economic sector

Adaptation/resilience

Finance