SSBTi Intelligence Brief
One-sentence takeaway: CBAM currently covers 569 CN 8 product codes. The three institutional proposals for the 2028 downstream expansion would add between 180 and 283 codes—potentially bringing machinery, vehicles, electrical equipment, furniture, hardware, and optical or medical instruments into scope. The 154 codes supported by both the Council and Parliament deserve immediate attention.
Why This Matters | Why · How · What
WHY — CBAM is moving from basic materials to finished products.
The first phase focused largely on carbon-intensive upstream materials. The proposed 2028 expansion reaches downstream products that contain those materials, shifting exposure toward manufacturers, assemblers, exporters, and brand owners.
HOW — Through product codes, embedded-emissions data, certificates, and verification.
Whether a product is covered depends on its CN 8 classification. Once in scope, the importer must address the product’s embedded emissions and CBAM certificate obligation. Suppliers that cannot provide credible product data may be pushed toward conservative default values.
WHAT — Product-level carbon data becomes commercial infrastructure.
Corporate greenhouse-gas inventories alone are no longer enough. Companies need traceable information by product, part number, material, process, and supplier. LCA and product carbon-footprint systems are becoming part of pricing, procurement, and market-access decisions.
1. CBAM Is Now a Payment Obligation
CBAM is no longer only a reporting exercise. From 1 January 2026, covered importers must purchase and surrender CBAM certificates corresponding to the embedded emissions of imported goods.
When supplier-specific emissions data are unavailable or cannot be verified, importers may have to rely on default values. Those defaults are designed to be conservative, which means that missing data can translate directly into a higher carbon cost.
This changes the business question from “Can we submit a report?” to “Can we defend our product data, cost assumptions, and price?”
2. Three Institutions, Three Scope Proposals
As of July 2026, the downstream expansion is still under negotiation. Three institutional positions point in the same direction but differ in breadth:
European Commission proposal — 17 December 2025
Adds 180 product codes. The main chapters include machinery, vehicles, articles of iron or steel, electrical equipment, furniture, optical and medical instruments, miscellaneous metal articles, and copper products.
Council general approach — 12 June 2026
Adds 197 codes and removes three. Its structure is broadly similar to the Commission proposal but also extends into tools and cutlery under Chapter 82.
European Parliament ENVI position — 6 July 2026
Adds 283 codes. It goes further into steel, aluminium, organic chemicals, railway equipment, and other downstream categories.
The final scope will be determined through the EU legislative process. Companies should therefore treat these figures as negotiation positions—not yet as a final legal list.
3. What Is Most Likely to Remain
The most useful way to read the three lists is not to wait for a single final number, but to separate common ground from negotiation items.
The Commission’s 180 items form the practical baseline. They define the core policy direction and are likely to anchor the final discussion.
The 154 codes added by both the Council and Parliament are the priority watchlist. Because both co-legislators support them, these items have a relatively high probability of surviving the final compromise.
The 46 Council-only items and 129 Parliament-only items remain negotiation items. Companies dealing in these products should monitor the trilogue closely but avoid treating them as settled law.
The strategic direction, however, is already clear: CBAM is moving downstream from raw and semi-finished materials toward finished products.
4. Three Layers of Business Impact
Direct certificate cost.
Once a product falls within scope, its embedded emissions affect the number of certificates the importer must surrender. Carbon performance becomes part of landed cost.
Indirect implementation cost.
Companies will need people, supplier engagement, data systems, verification, documentation, and cross-functional coordination. For many businesses, these operational costs may exceed the certificate cost—especially during the first implementation cycle.
A structural shift in responsibility.
The burden is moving from primary-material producers toward component makers, assemblers, finished-goods manufacturers, exporters, and brands. A group-level carbon inventory cannot substitute for product-level evidence.
5. Five Actions to Start Now
1. Map EU-bound products by CN 8 code.
Build a product-level map and distinguish the high-probability 154-code watchlist from the items that remain under negotiation.
2. Test the 50-tonne exemption threshold.
Simulate total annual imports at importer level and across covered products. Do not assess each shipment or SKU in isolation.
3. Replace defaults with measured data.
Prioritize baseline data for products most exposed to the proposed expansion. Identify the materials, processes, and suppliers responsible for the largest emissions contribution.
4. Model certificate-price scenarios.
Translate carbon-price scenarios into quotation, margin, contract, and sourcing impacts. Decide how carbon costs and data obligations will be allocated between supplier and customer.
5. Use LCA to identify reduction opportunities.
Apply ISO 14040/14044 and ISO 14067 methods to identify carbon hotspots and test material, energy, process, and logistics alternatives. The objective is not only compliance, but a lower and more defensible product cost.
6. Timeline: Roughly 18 Months to Prepare
September 2026: the European Parliament is expected to establish its plenary position.
Fourth quarter of 2026: trilogue negotiations are expected to shape the final expansion list.
1 January 2028: the downstream expansion is expected to take effect.
The exact schedule may still change, but the preparation window is short. Product classification, supplier data collection, verification, and LCA modelling cannot be built reliably at the last minute.
7. The SSBTi View
CBAM should not be understood merely as a new border charge. It is a market-access threshold built on data governance.
Companies with credible, verifiable product data retain room to negotiate with importers, customers, and suppliers. Companies without data are more likely to accept EU defaults—and the cost and commercial consequences that follow.
For most manufacturers, the practical starting point is not to model every product at once. Begin with the core EU-export portfolio, establish product carbon footprints aligned with ISO 14067 and ISO 14044, and build a repeatable data process that can be extended to additional SKUs.
For companies with data, 2028 is an adjustment. For companies without data, it may become a forced price.
Further Reading | The Real Footprint Digest
Raymond Wang · SSBTi · July 2026