CBAM part 1: for Türkiye, Kazakhstan and Ukraine, verified data now sets the bill

The EU's carbon border adjustment mechanism (CBAM) entered its definitive phase on 1 January. The legal obligation sits with EU importers: any importer bringing in more than 50 tonnes of CBAM goods a year must hold authorised declarant status, declare the emissions embedded in those goods and surrender certificates priced off EU emissions trading auctions, the European Commission says. For producers of steel, aluminium, fertilisers and cement in Türkiye, Kazakhstan and Ukraine, the practical question is whose emissions figure goes into that declaration. This series takes the three countries in turn. Part 1 sets out the rules and the arithmetic they share.

The timetable

The first annual declaration, covering 2026, is due by 30 September 2027, and certificates go on sale on a common central platform from 1 February 2027, under Regulation (EU) 2025/2083, which also lets the Commission publish default carbon prices for third countries with carbon pricing rules from 2027. For 2026 imports the certificate price is a quarterly average of allowance auction prices: €82.32 for the third quarter, published on 5 October, according to the Commission's price page.

The charge phases in as the EU withdraws free allowances from its own producers. The Commission's guidance lists a CBAM factor of 97.5 per cent for 2026, falling to 51.5 per cent in 2030 and zero in 2034, and reduces importers' certificate obligations by a matching free allocation adjustment (Guidance No. 4). In 2026 that adjustment removes 97.5 per cent of the EU benchmark from each tonne's obligation, so what remains depends mainly on how far a good's embedded emissions exceed the benchmark.

Why verified data matters

Where an importer has no verified installation data, it must use default values. These are set country by country and carry a mark-up of 10 per cent in 2026, 20 per cent in 2027 and 30 per cent from 2028, or 1 per cent for fertilisers, under Implementing Regulation (EU) 2026/1740, which since July has the CBAM Registry apply the mark-up. Actual data can replace the defaults only if checked by a verifier accredited by a national accreditation body in the EU. Registering installations in the CBAM Registry is "recommended, but currently voluntary", and operators are "strongly advised" to do it, the Commission's guide for non-EU operators says. Its December 2025 report on the application of CBAM counted 78 registered third-country operators.

The defaults diverge sharply. For semi-finished carbon steel (CN 7207 11 14), the Commission's default values workbook lists 5.180 tonnes of CO2 equivalent per tonne for Kazakhstan, 2.397 for Ukraine and 2.310 for Türkiye, against 3.996 for countries without their own table. For unwrought aluminium it lists 1.870 for Kazakhstan and 1.700 for Türkiye, both on the primary route, and 0.360 for Ukraine, on the secondary route.

Take the steel figures, add the 10 per cent mark-up and subtract the 2026 adjustment, which uses a benchmark of 1.364 for the blast furnace route in the Commission's benchmarks workbook and a cross-sectoral correction factor that the Commission has fixed at 100 per cent for 2026 to 2030. The result is about 4.37 certificates per tonne of Kazakh semi-finished steel, 1.31 for Ukrainian and 1.21 for Turkish. At the third-quarter price that is roughly €360, €108 and €100 a tonne, before any deduction for carbon prices paid at home. The calculation is ours. Verified data below the defaults would lower it.

Carbon prices at home, and the exposure

Article 9 of the CBAM Regulation allows a deduction for a carbon price effectively paid in the country of origin. The Commission's guidance counts free allocation under an emissions trading system as a rebate, and the price paid must be certified by someone independent of both the declarant and the third country's authorities (Guidance No. 2). The three countries start from different places:

• Türkiye published secondary regulations for its emissions trading system in the Official Gazette on 27 August, under a climate law adopted in July 2025. The pilot's start and the first national allocation plan are still pending, ICAP reported.
• Kazakhstan has run an emissions trading system since 2013, but all allowances have been allocated free since 2021, and the average 2025 secondary-market price was KZT 455.48, or $0.87, according to ICAP.
• Ukraine has a low carbon tax on fuel emissions and adopted a roadmap for a national emissions trading system on 21 February 2025, the Commission's report notes. The report also commits the Commission to measures within the CBAM framework to help Ukraine, including simpler reporting and support for monitoring and carbon pricing.

Exposure is largest for Ukraine and Türkiye. Between the fourth quarter of 2023 and the second quarter of 2025 they supplied about 14 per cent and 12 per cent of CBAM goods imported into the EU by mass, the two largest shares, and Ukraine alone supplied 17.3 per cent of iron and steel imports, the Commission found. Kazakhstan is not among the largest suppliers named in that report. Part 3 of this series will set out its exposure.

The scope may widen. EU negotiators hold their first trilogue on extending CBAM to downstream steel and aluminium products, and on tighter anti-circumvention rules, on 20 October, according to Mayer Brown. Part 2 turns to Türkiye.