Update October 17, 2025: The CBAM Simplification Regulation (EU) 2025/2083 of the European Parliament and of the Council of October 8, 2025, which amends the original CBAM Regulation (EU) 2023/956, has been published in the Official Journal of the EU, officially concluding the legislative process. The regulation enters into force three days later, on October 20.
On September 29, 2025, the Council of the EU formally approved the amendments to the Carbon Border Adjustment Mechanism (CBAM) Regulation that the European Commission first proposed in February as part of its Omnibus I legislative package. This means all three EU institutions (Commission, Parliament and Council) have agreed on a set of changes to the original CBAM Regulation (EU 2023/956).
Among other things, these changes aim to reduce administrative burden, smooth out the impact on cash flow, and give importers more flexibility and clarity as they make the transition to the definitive CBAM system.
Why the Omnibus simplifies CBAM
The original CBAM regulation was ambitious and climate-friendly, but it was criticized as too complex and burdensome, especially for smaller companies.
- Administrative burden and complexity: Reporting embedded emissions, verifying data and using the CBAM registry placed high operational demands on importers.
- Strain on cash flow and working capital: The obligation to purchase and hold 80% of CBAM certificates in advance tied up significant working capital.
- Data uncertainty and verification constraints: Immature emissions data from the supply chain made accurate reporting difficult, which called for flexibility through default values or prior-year values.
- Encouraging participation and fairness: Policymakers wanted to make compliance feasible for smaller importers to ensure fairness and broad participation.
In short: CBAM keeps its climate integrity, while implementation becomes simpler.
What exactly has changed?
Below is a breakdown of the key changes to be introduced by the Omnibus I update. It serves as a quick reference that gives an overview of the most important points.
| Requirement |
Original CBAM (pre-Omnibus) |
Amended CBAM (Omnibus I) |
| Threshold / de minimis |
Based on a €150 per consignment rule; small consignments may be exempt. |
Switch to a mass-based threshold: importers of aluminum, iron, steel, cement and fertilizers with ≤ 50 tonnes per year of CBAM goods are exempt from many reporting and compliance obligations. Electricity and hydrogen remain exceptions: all imports from these two product groups must still be reported regardless of quantity. |
| Quarterly reporting deadlines |
Reports are due at the end of July after the second quarter, and so on. |
Deadlines have been extended; annual CBAM declarations are now due at the end of September (under the new timeline from 2027) to gain more time. |
| Annual declaration and reporting in the definitive phase |
Annual declarations from 2026, but earlier quarterly obligations continued during the transitional phase. |
Annual reporting is firmly established in the definitive system, replacing most quarterly reporting obligations. |
| Certificate buffer |
Importers must hold certificates covering 80% of embedded emissions each quarter. |
Reduced to 50%, lowering the capital burden. |
| Start of certificate purchase and surrender |
Full purchase and surrender obligations start on January 1, 2026 for the imports concerned. |
For goods imported in 2026, the first purchase and surrender of certificates is postponed to February 2027, delaying the liquidity pressure. |
| Use of default vs. actual values |
Strong preference for actual emissions data; default values are only used when no reliable alternatives are available. |
Greater tolerance for default values and use of prior-year data if the combination of goods and countries remains unchanged; verification only required when actual values are used. |
| Delegation / appointment of a representative |
Possible, but less formally structured; importers largely have to handle reporting directly. |
Formal option to appoint a “CBAM representative” who submits reports on behalf of importers (legal liability, however, remains with the importer). |
| Scope clarifications and exclusions |
Broad product coverage; certain materials or precursors are subject to interpretation or inclusion risks. |
Some precursors and low-intensity products have been explicitly excluded (e.g. uncalcined alumina); clearer rules for direct vs. indirect emissions for electricity. |
What’s next?
- The legal act will most likely be published in the Official Journal of the EU by the end of October. The changes enter into force automatically on the third day after publication.
- The definitive (pricing) phase of CBAM starts in January 2026, marking the transition from the current reporting-only phase to the full compliance system.
- By February 2027, importers must surrender all CBAM certificates for all imports of CBAM-regulated goods from 2026 onward.
