New legislation

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19 Jan 2026
Subject Tax updates
Categories Tax

Overview:

CBAM – new legislation published – Webcast on 28 January

On 17 December, the European Commission published several important documents related to the Carbon Border Adjustment Mechanism (CBAM), including eight Implementing Regulation, one Delegated Regulation, a review report on the application of the CBAM Regulation, and two proposals introducing potential changes to the CBAM product scope and framework. You can access all publications here: EU Commission CBAM page

Below we list the regulations and proposals that have been published. On 28 January, from 12:00 to 13:00, we will host our monthly Global Trade & Sustainability Webcast. During this edition of the Webcast, we will discuss the new CBAM legislation. If you would like to join, please select Add To Calendar.

What has been published?
  • Implementing Regulation on calculation methodology + Annex
  • Implementing Regulation on free allocation adjustment
  • Implementing Regulation on customs communication
  • Implementing Regulation on default values + Annex
  • Implementing Regulation on the price of CBAM certificates
  • Implementing Regulation on verification principles + Annex
  • Implementing Regulation on authorization of declarants (amending/correcting the Commission Implementing Regulation (EU) 2025/486 laying down rules for the application of Regulation (EU) 2023/956 of the European Parliament and of the Council as regards the conditions and procedures related to the status of authorised CBAM declarant)
  • Implementing act on the CBAM registry (amending/correcting the Implementing Regulation (EU) 2024/3210 as regards the CBAM registry)
  • Delegated Regulation on accreditation and verification + Annex
  • Review report on the application of the CBAM Regulation + Annex
  • Proposal as regards the extension of its scope to downstream goods and anti-circumvention measures + Annexes
  • Proposal establishing the Temporary Decarbonisation Fund + Annexes
Proposals

The EU Commission adopted two proposals. The legislative proposals will be submitted to the European Parliament and the Council for their consideration and adoption and may still change. Below you find an executive summary of the two proposals:

1.    Proposal as regards the extension of its scope to downstream goods and anti-circumvention measures

  • Downstream Extension per 1 January 2028: CBAM will be broadened to cover heavy industrial machinery as well as steel- and aluminium-intensive downstream products (full list is attached).
  • Enhanced Anti-Circumvention Measures: Introduction of stricter safeguards, including improved reporting requirements for better traceability and the inclusion of pre-consumer scrap in CBAM calculations.
  • Simplified Electricity Rules: Clarification and simplification of the methodology for electricity imports to ensure consistency and ease of compliance.

2.  Proposal establishing the Temporary Decarbonisation Fund + Annexes

  • A new fund will support EU producers facing residual carbon leakage risks
  • Start Date: 1 January 2028
  • Coverage: Production years 2026 and 2027
  • Purpose: Provide targeted financial support to maintain competitiveness while incentivising decarbonisation efforts.

CBAM - Proposal for scope extension to include additional downstream goods

On Wednesday, 17 December 2025, The European Commission adopted a new proposal as regards the extension of the CBAM scope to include additional downstream goods and enhance anti-circumvention measures. 

  • Downstream goods extension per 1 January 2028: CBAM will be broadened to cover heavy industrial machinery as well as steel- and aluminium-intensive downstream products (click here for a full list of products in scope).
  • Enhanced anti-circumvention measures: introduction of stricter safeguards, including improved reporting requirements for better traceability and the inclusion of pre-consumer scrap in CBAM calculations.
  • Simplified electricity rules: Clarification and simplification of the methodology for electricity imports to ensure consistency and ease of compliance.

European Parliament adopts changes to postpone and simplify EUDR

On the 26th of December 2025 the amended European Deforestation Regulation ("EUDR") has entered into force. Originally adopted in 2023 the revised regulation aims to make compliance easier for businesses and stakeholders while preserving the regulation’s core objective: preventing products linked to deforestation from entering the EU market.

Key Measures

1. The date on which the EUDR will become applicable, and compliance will be required, is extended with one year:

  • Large operators and traders: 30 December 2026
  • Micro and Small enterprises: 30 June 2027

2. Streamlined due diligence, with the responsibility placed on businesses first introducing products to the EU market.

Handling fee for e-commerce imports

On the 12th of December, the European Council agreed to apply a fixed customs duty of €3 on small parcels valued at less than €150 entering the EU from 1 July 2026. This measure is part of the planned reform of the EU Customs Code and aims to discourage separate imports of low-value items by making them less commercially attractive.

Key Measures: starting 1 July 2026, a fixed customs duty of €3 on small parcels valued at less than €150 will apply.

New rules of origin for trade with PEM-countries starting 1 January 2026

On the 12th of December, the European Council agreed to apply a fixed customs duty of €3 on small parcels valued at less than €150 entering the EU from 1 July 2026. This measure is part of the planned reform of the EU Customs Code and aims to discourage separate imports of low-value items by making them less commercially attractive.

Key Measures: starting 1 July 2026, a fixed customs duty of €3 on small parcels valued at less than €150 will apply.

New rules of origin for trade with PEM-countries starting 1 January 2026

On 1 January 2026, the revised rules of origin for PEM-countries on trade between the EU and most Pan-Euro-Mediterranean countries entered into force. As a consequence, the possibility to apply the previous rules of origin is no longer applicable. 

Key Measures
  • In case of trade between the EU and PEM-countries, new rules of origin must be applied. Algeria will temporarily still use the old rules of origin originating in 2012. As a result, Algeria cannot apply diagonal cumulation with PEM-countries using the new rules of origin or transitional rules. 
  • Marocco, Tunisia, Egypt and Palestina will temporarily use the transitional rules for trade with the EU. The EU accepts proof of origin from these countries according to the transitional rules of 2021. Vice versa these countries accept proofs of origin from the EU according to the revised rules. 
  • As an exporter to PEM countries as of 1 January 2026 it is no longer required to include ‘revised rules’ on the EUR.1 certificate or invoice declaration. 
  • To satisfy origin requirements, document codes must be listed in the import declaration.

Next steps: for businesses trading with PEM-countries it is essential to verify which rules of origin apply to them. In the cumulation matrix of the European Commission the specific information per PEM-country can be found including the latest news. Furthermore, it is essential to include the correct country codes, preferential codes and document codes on the import declaration.

Regulation on the pricing of CBAM certificates 

On Wednesday, 10 December 2025, the European Commission adopted a regulation on the calculation and publication of the price of CBAM certificates. 

Key Measures

1. Pricing of CBAM certificates

  • For 2026: the price is set on a quarterly basis, based on the weighted average of auction clearing prices for EU ETS allowances in each quarter.
  • From 2027: the price is set on a weekly basis, based on the weighted average of auction clearing prices for EU ETS allowances in each week.
  • Prices are calculated in Euros and rounded to the nearest cent. 

2. Publication of CBAM certificate prices.

  • The European Commission publishes the CBAM certificate price on its website and makes it available to authorised CBAM declarants in the CBAM registry.
  • Publication will occur promptly after the relevant period, respectively monthly and weekly.

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