Border Carbon Adjustment Mechanism in 10 questions

1. What is CBAM (Border Carbon Adjustment Mechanism)?

The Border Carbon Adjustment Mechanism is one of the key instruments for achieving the EU's greenhouse gas emission reduction target set by the Green Deal.

2. What does the EU aim to achieve with this adjustment?

The EU aims to protect Europe's competitiveness in the face of the costs of green transformation on the one hand, and to increase the global effort to combat climate change on the other.

3. What will be the implementation schedule?

The CBAM Regulation entered into force on October 1, 2023, limited to the reporting obligation.

4. What does the transition phase and beyond entail?

Importers will have to report the emissions embedded in their products subject to the CBAM without financial obligation during the transition phase, which starts on October 1, 2023 and ends at the end of 2025.

5. How will it work?

Once the CBAM comes into force in 2026, importers in the EU will purchase carbon certificates corresponding to the carbon price that would have been paid if the products they import had been produced under the EU's carbon pricing rules.

6. Which industries will it cover?

The CBAM will initially cover the grassroots, iron and steel, aluminum, fertilizers, hydrogen and electric power industries.

7. How are CBAM emissions calculated?

CBAM emissions take into account direct emissions as well as indirect emissions from the generation of electricity used in the production process.

8. What are the reporting obligations during the transition period?

During this period, importers or indirect customs agents importing CBAM products will be required to report for each quarter within the first 1 month following each quarter on the products they imported in that quarter.

9. Who is responsible for reporting and financial obligations under the CBAM?

The importer resident in the EU or its indirect customs representative, or the indirect customs representative if the importer is not resident in the EU.

10. What is the share of products in Turkey's exports to the EU within the scope of the CBAM?

As of 2023, Turkey's total exports to the EU amounted to USD 9.8 billion and the share of exports to the EU in Turkey's total exports to the world is 42 percent.