Are you applying for CBAM authorized reporting status, but your company has been operating for less than two years? You need to submit a financial guarantee. KOBiZE has just published instructions on how to calculate it. We'll break it down.
What is the CBAM guarantee and who does it apply to?
The CBAM guarantee is one of the requirements that an applicant seeking CBAM Authorized Declarant status must meet. However, it does not apply to all importers.
The obligation to provide a guarantee arises from Article 17(5) of the CBAM Regulation and applies only to applicants who have not conducted business activity for the two financial years preceding the year of application. In other words, if your company has been in existence and operating for at least two full financial years, the guarantee does not apply to you.
Why was this requirement introduced? The European Commission wants to ensure that new market entrants are able to meet their obligations to purchase and redeem CBAM certificates. The guarantee provides financial security in the event that the importer is unable to cover the cost of certificates corresponding to the emissions embedded in the imported goods.
Guarantee calculation formula
The guarantee amount is calculated according to a simple formula:
WARRANTY (EUR) = Number of CBAM certificates × Estimated price of CBAM certificate (EUR)
It sounds simple, but the devil is in the details. The number of CBAM certificates must take into account the import of goods both in the year of application and the following year. Additionally, an adjustment related to the free allocation of EU ETS allowances (the so-called CBAM Factor) must be applied.
KOBiZE published a detailed algorithm for estimating the number of certificates in a press release dated November 14, 2025, on its website.
What data is needed for calculations?
To correctly calculate the number of CBAM certificates, you need three types of data:
First, the default emission factors, expressed in tons of CO2 per ton of imported goods. These values vary depending on the goods' CN code and country of origin. The European Commission published them on December 17, 2025, in an implementing regulation specifying the default values for goods covered by the CBAM mechanism.
Secondly, the CBAM benchmarks, i.e., emission reference values for individual commodity categories. These were also published by the European Commission at the same time in a separate implementing regulation on calculating the free allocation adjustment.
Third, the estimated volume of CBAM goods imported for the current and next year. You must estimate this data yourself based on your company's import plans.
You can find the indicative reference price for the CBAM certificate on the European Energy Exchange (EEX) website. In the advanced search engine, select: Commodity: Environmentals, Pricing: Indices, Area: EU, Product: CBAM Reference Price, Product-specific: EUR. At the end of November 2025, the reference price was approximately €81,1 per tonne of CO2.
Practical calculation example
Let’s assume you apply for CBAM Authorised Declarant status in December 2025. Your company imports two types of goods covered by the mechanism:
Imports in 2025:
- Cast iron and steel (CN code 7207 20 11) from China – 200 tons
- Cement (CN code 2523 29 00) from Ukraine – 100 tons
Planned imports in 2026:
- Cast iron and steel (CN code 7207 20 11) from China – 300 tons
- Cement (CN code 2523 29 00) from Ukraine – 400 tons
Step 1: Establishing parameters
For these calculations, we assume a CBAM Factor of 97,5% (the value applicable in 2026) and default values with a 10% mark-up. For blast furnace-based carbon steel (BF/BOF), the CBAM benchmark is 1,364 t CO2/t and the default emissions value is 3,486 t CO2/t. For cement, the benchmark is 0,666 t CO2/t and the default value is 1,518 t CO2/t.
Step 2: Calculating the number of certificates for import in 2025
The formula for the number of certificates takes into account the difference between the default value of the issue and the benchmark adjusted for the CBAM Factor:
Iron and steel: (3,486 – 1,364 × 0,975) × 200 = 432 certificates Cement: (1,518 – 0,666 × 0,975) × 100 = 87 certificates
Step 3: Calculating the number of certificates for the planned 2026 import
Iron and steel: (3,486 – 1,364 × 0,975) × 300 = 648 certificates Cement: (1,518 – 0,666 × 0,975) × 400 = 348 certificates
Step 4: Calculating the guarantee amount
Total certificates: 432 + 87 + 648 + 348 = 1515 certificates
At a reference price of €81,1 per certificate:
WARRANTY = 1515 × 81,1 = €122,866.50
In this example, the importer would need to provide a guarantee for almost €123. This is a significant sum that requires appropriate planning.
Important note regarding emission types
In the CBAM target period, only direct emissions are calculated for commodities from the iron and steel, aluminum, hydrogen, and electricity sectors (Article 7(1) of the CBAM Regulation). For cement and fertilizers, indirect emissions are also taken into account.
Can the guarantee amount be reduced?
Yes. If you provide documentation confirming the greenhouse gas emission tax actually paid in a third country, this correction can be deducted from the guarantee amount. The decision rests with the Director of the Tax Administration Chamber. This primarily applies to imports from countries with their own ETS systems (Great Britain, China, South Korea).
Obligation to monitor warranty
Obtaining the status isn't the end of the guarantee story. The authorized CBAM applicant is responsible for ensuring that the guarantee remains at a level sufficient to cover the number of certificates required for redemption.
If your imports increase significantly or the price of certificates increases, you will need to increase your guarantee. Once the final implementing regulations come into force, you may also need to recalculate the guarantee amount.
Practical tips at the end
If your company has been operating for less than two years and you plan to apply for CBAM Authorized Declarant status, start by carefully estimating your planned imports. The more precise your forecasts, the better your guarantee amount will be.
Remember that the warranty must cover imports both in the year of application and the following year. Don't underestimate – underestimating may result in having to replenish the warranty during the year, generating additional administrative costs.
Regularly monitor the reference price of CBAM certificates on the EEX exchange. This price is linked to the price of EU ETS allowances, which has shown significant volatility in recent years and can significantly impact the required collateral amount.
Finally, if you are importing from countries with their own emission fee systems, collect documentation proving the fees paid – this may be used to reduce the required guarantee amount.
Need help preparing your CBAM Authorized Reporter application or calculating the required guarantee? Contact Green Reporting – we'll help you through the entire process: office@greenreporting.eu
