Draft rules: deduct a foreign carbon price from CBAM certificates

A draft Commission implementing regulation, Ares(2026)4841230, sets out how a carbon price paid abroad could reduce the CBAM certificates you surrender. Your supplier may already pay a carbon price at home, and the draft answers whether that payment counts. It is detailed enough to prepare against, but every operative point below stays proposed until an adopted act appears in the Official Journal.

The legal basis is Article 9(5) of Regulation (EU) 2023/956. The purpose is to stop the same emissions being charged twice. In return, the draft would require a traceable link between the foreign payment, the embedded emissionsEmbedded emissionsThe greenhouse-gas emissions released producing a good — direct emissions plus, where applicable, indirect (electricity) emissions — expressed per tonne of good; electricity uses kWh legally and may be converted to MWh operationally. This i and the goods you import.

Your emissions data would decide which route you get

Under the draft, goods reported with actual embedded emissions would give the declarant a choice. You could use a certified effectively paid carbon price, or a Commission default carbon price.

Goods reported with default embedded emissions would have no choice, and only the Commission default-carbon-price route would be open.

The draft would also let you handle direct emissions, applicable indirect emissions and precursorPrecursorUpstream CBAM good consumed as input to a complex-good process; listed per route; quantities always monitored per Annex II pt E. emissions separately, across different mechanisms and jurisdictions. Supplier-specific precursor prices would be quantity-weighted before they are attributed to complex goods.

Check now which installations can support certified payment data, and where you may need Commission defaults instead.

Only the price actually paid would count

The draft would treat several mechanisms as eligible, but only the part attributable to CBAM-relevant embedded emissions would count. The eligible mechanisms are:

• a carbon tax, levy or fee;
• an emissions trading system;
• a baseline-and-credit system;
• certain fuel carbon-content charges;
• authorised compliance credits.

Two systems rarely draw their boundaries in the same place. The draft therefore permits a boundary difference of up to 5% between the foreign mechanism and the CBAM system boundariesSystem BoundariesThe incorporated UK document defining which production processes and emissions belong in the UK CBAM calculation boundary.. It would also recognise qualifying international credits authorised or issued under Article 6(2) or Article 6(4) of the Paris Agreement. These credits are capped at 10% of reported and confirmed mechanism emissions.

Under the draft, any payment that returns money reduces the price. Free allowances, thresholds, exemptions, reduced rates, refunds, rebates and monetary compensation would all cut the effective price. The draft would also consider indirect-cost compensation for electricity carbon costs. One proposed carve-out covers certain publicly available decarbonisation support that is funded from carbon-price revenue.

The evidence would have to connect the payment to the goods

The draft asks the operator for an electronic report. The report would identify the carbon-pricing mechanism and its legal basis, the covered emissions and the prices. It would also identify the allowances or credits surrendered, the payment evidence, rebates and compensation, the goods and precursor allocation, and the currency conversion.

Foreign currency would be converted at the official yearly average exchange rate for the reporting periodReporting periodDefault = calendar year of the producing installation; 2026 imports legally fixed to reporting period 2026; alternative ≥3 consecutive representative months; no pre-2026 period. Workbook sheet 5x offers Calendar/Financial/Custom.. The certificate reduction would then be calculated against a yearly CBAM-certificate reference price. This price is derived from certificate prices for the import year.

One proposed rule matters for finance teams. If an operator is entitled to compensation but cannot evidence the amount, the draft says the report cannot establish a certifiable effective price. That rule is not yet law, but it shows why you should map compensation evidence alongside tax and allowance-payment records, not after them.

Certification would be a separate assurance step

The draft would create an accreditation activity group for carbon-price certification. A verifierVerifierAccredited independent third party confirming the SEE is free of material misstatement; any EU or third-country legal person; only values in a verification report count for actuals. Importers receiving "verification reports" from third part who already checks embedded emissions could do this work too, if appropriately accredited and independent.

The proposed conclusion is reasonable assuranceReasonable assuranceThe assurance level of CBAM verification statements (workbook "Engagement type" dropdown also offers "Limited assurance" — CBAM verification itself is reasonable-assurance). at 5% materiality, in draft Annex IV. The text also covers site visits, competence, independence and how far this work may rely on emissions verification. The draft envisages a Registry-generated certification report from 1 January 2027. That date is proposed in the draft and is not an adopted deadline.

What it means for importers

Nothing changes in your certificate count today, because the conversion rules are still a draft. If they are adopted as drafted, a carbon price your supplier actually paid could reduce the certificates you surrender. The choice of route would depend on whether you report actual or default embedded emissions.

What to do

Build the evidence chain first, not the calculation, because evidence takes the longest.

• Inventory the mechanisms, payments, rebates, compensation, credits, FX records and precursor data behind your supply chain.
• Ask operators to test whether those records connect cleanly to specific goods and specific reporting periods.
• Do not run a final certificate-reduction calculation yet, because every threshold, form and accreditation rule described here can still change.
• Compare the adopted act with this draft before you rely on any of them.

The right action today is an evidence-gap review and an adoption watch.

Stuck on this in your own import data? Write to us and we will look at it with you.

This article explains a draft regulation. It is not legal, tax or customs advice.