EU Institutions Agree On CBAM Modifications

On June 18, 2025, the presidency of the EU Council and representatives of the European Parliament agreed on substantial changes to the EU's carbon border adjustment mechanism (CBAM).

According to the Council's press release, importers who do not exceed a single mass-based threshold of 50 tons of imported goods per year will be exempted from CBAM obligations. Furthermore, the provisional agreement includes other simplification measures for all importers of goods covered by CBAM, such as the authorization procedure, the calculation of embedded emissions, the emission verification rules, and others. The text agreed upon between the Council and the European Parliament has not yet become available.

The provisional agreement between the Council and the Parliament must now be formally endorsed by both institutions. It is expected that these steps will take place shortly to ensure that these changes are formally adopted when the substantive CBAM provisions begin to apply on January 1, 2026.