The CBAM, or the adjustment mechanism for import duties tied to carbon emissions, aims to level the playing field for European steel, cement, aluminium, fertilizer, hydrogen, and electricity producers. Officials describe the regulation as a necessary guard against the relocation of factories to regions with laxer environmental rules, even though it will be challenging to manage and implement. This observation comes from Andrés Barcelo, the director general of Unesid, the Spanish steel industry association.
Barceló explained that the European Union has begun applying the mechanism in a limited, informational capacity. Its core goal is to align competitive conditions by imposing costs on imports that do not reflect the same environmental penalties present in their countries of origin. The practical concern for European manufacturers is that steel production is increasingly feasible outside the EU, potentially eroding local market share.
As a transitional step, the border adjustment took effect for statistical purposes on 1 October, with a transition period through January 2026. From that point, importers will face gradually higher charges for goods that dodge the full carbon costs present in Europe. The program plans to reach full coverage of environmental costs by 2034, aiming to curb incentives for shifting production abroad. The tightening will occur in tandem with diminishing free emission rights through the years, addressing the risk that heavy-emitting plants relocate elsewhere, and ensuring competitive parity with producers in Türkiye, China, Singapore, and other economies.
Unesid cautioned importers about the complexity of the procedures and the large volume of documents required by the competent authorities. It was noted recently that some of these documents had not yet been provided by Spain’s Ministry of Energy Transition, and that neither department had issued clear follow-up guidance from the General Directorate of Customs.
The measure applies to all non-EU nations except Iceland, Liechtenstein, Norway, and Switzerland, which enjoy preferential access through existing EU agreements. Unesid added that the United States attempted to secure an exclusion but did not succeed.
The steel industry group suggested that formalizing the procedure would be simpler if the rules around basic products—such as steel coils and downstream products—were more straightforward. Importers must declare the quantity imported, the price, and both the facility’s carbon footprint and the footprint of the producing site before conversion. Those who fail to provide the requested information will face fines starting in January when the first quarterly declaration is due. From 2026, notifications are planned to be issued annually.
Some products, including scrap metal, ferroalloys, cables, wires, metal fabrics, nails (excluding screws), chains, springs, and stoves, will be exempt from the new charges. Unesid noted this exemption list as part of the evolving framework.
The European Commission is tasked with issuing 18 implementing regulations related to the mechanism by 2026. While yesterday’s discussions did not specifically address the ongoing demands from industry for a broader compensation system, concerns persist that the proposed border adjustment may not fully offset the cost differentials faced by European exporters to third countries under the current environmental policy regime, a point repeatedly raised by industry groups, including Unesid. In this context, the CBAM is viewed as a foundational step in a longer transition toward more climate-responsible trade rules. ”