In 2025, many U.S. cannabinoid beverage brands treated the EU’s Carbon Border Adjustment Mechanism (CBAM) as “something the importer will handle.” In 2026, that mindset becomes expensive.
CBAM is now in its definitive phase (financial obligations begin 1 January 2026), and it targets carbon-intensive goods including aluminium. Even when the finished drink itself is not a CBAM good, the aluminium packaging supply chain can create CBAM exposure in two common ways:
- The EU buyer/importer separately imports empty aluminium cans (or can components) that fall within CBAM’s scope.
- The EU buyer/importer imports aluminium sheet/coil/foil (CBAM goods) that is then converted into cans in the EU.
Either way, U.S. beverage companies that want to sell THC drinks in Europe should treat CBAM as a core part of cannabis compliance planning: contract terms, supplier data, emissions verification, and packaging strategy.
This article explains what happens in 2025–2026, who files CBAM reports, what data you must obtain from can and aluminium suppliers, and how CBAM interacts with recycled-content strategies and the EU’s Packaging and Packaging Waste Regulation (PPWR). It includes a supplier questionnaire template and a decision tree you can adapt into contract language.
Informational only; not legal advice.
EU CBAM in 2025–2026: what changes (and why packaging teams should care)
Transitional reporting (through 31 December 2025)
CBAM’s transitional phase runs from 1 October 2023 through 31 December 2025. During this phase, the CBAM obligation is primarily reporting: the reporting declarant submits quarterly CBAM reports on imports of CBAM goods and their embedded emissions, with reports due one month after each quarter ends.
Key points for 2025:
- The reporting declarant must report quantities and embedded emissions of imported CBAM goods.
- The European Commission published default values for embedded emissions for the transitional period, intended as a fallback when supplier data isn’t available.
- Penalties for failures during the transitional period can apply, with guidance commonly referencing €10–€50 per unreported tonne of emissions (set and enforced by Member States).
Official Commission CBAM overview and phase description: https://taxation-customs.ec.europa.eu/carbon-border-adjustment-mechanism_en
Definitive phase (from 1 January 2026)
From 1 January 2026, CBAM becomes a financial compliance system. The European Commission stresses that importers (or their indirect customs representatives) should apply for authorised CBAM declarant status.
What changes in 2026:
- Only an authorised CBAM declarant can import CBAM goods for free circulation (subject to thresholds/exemptions).
- Importers must purchase and surrender CBAM certificates to cover the embedded emissions in imported CBAM goods (net of any permitted adjustments, such as carbon price paid abroad).
- Reporting becomes annual in the definitive regime, with the annual CBAM declaration and surrender typically due by 31 May following the year of import (Commission and Member State guidance materials continue to evolve).
The Commission’s CBAM registry and reporting page (including authorisation module references): https://taxation-customs.ec.europa.eu/carbon-border-adjustment-mechanism/cbam-registry-and-reporting_en
Are aluminium beverage cans in CBAM scope?
CBAM applies to goods listed in Annex I of Regulation (EU) 2023/956, identified by CN codes. For aluminium, the initial CBAM scope focuses on primary and semi-finished aluminium products (e.g., unwrought aluminium and certain bars, plates/sheets, foil, tubes).
Where beverage cans fit:
- Beverage cans are typically classified under CN heading 7612 (“Aluminium casks, drums, cans, boxes and similar containers…”).
- The practical compliance question is whether your specific can (or can component) CN code is included in CBAM Annex I as implemented in TARIC and Member State customs systems.
Because CBAM scope is CN-code specific and enforcement is executed at customs declaration level, brands should not guess. Instead:
1) Ask your EU importer for the exact CN code used when importing your can/packaging component.2) Confirm whether that CN code is a CBAM good in TARIC / CBAM guidance.3) If the can is not itself in scope, check whether can sheet/coil/foil inputs are being imported into the EU by your supply chain (those are commonly in scope).
CBAM scope and sectors (Commission): https://taxation-customs.ec.europa.eu/carbon-border-adjustment-mechanism/cbam-sectors_en
Who files CBAM reports: importer of record vs. indirect customs representative
CBAM obligations attach to the party acting as the CBAM declarant.
During the transitional period, the European Commission’s CBAM FAQ clarifies that the reporting declarant can be:
- the importer, or
- an indirect customs representative.
And CBAM Regulation Article 5 allows importers to appoint direct or indirect customs representatives under the Union Customs Code.
Practical consequences for U.S. exporters:
- If your EU customer is the importer of record, they usually remain the responsible CBAM party unless they formally shift the role.
- If your EU customer uses an indirect customs representative and that representative agrees to act as the CBAM declarant, the representative can file CBAM reports and handle certificates—but they will price that service, and they will demand data and contractual protections from upstream suppliers.
Commission CBAM FAQ (November 2023) discussing declarant roles: https://taxation-customs.ec.europa.eu/system/files/2023-11/CBAM%20Frequently%20Asked%20Questions_November%202023.pdf
What data your beverage brand must obtain from can and aluminium suppliers
CBAM reporting is only as good as the embedded emissions data supporting it. Even though the EU importer files, brands that want consistent EU market access need to build a supplier data pipeline.
At minimum, expect EU importers to ask for the following for each relevant CBAM good (or precursor) and each reporting period:
1) Product identification and customs data
- CN code used for import
- Product description (e.g., can sheet, foil, empty can bodies)
- Quantity imported (net mass and/or units, depending on CN code)
- Country of origin
2) Installation-level traceability
CBAM is designed around emissions from the installation producing the CBAM good.
Supplier data requests often include:
- Installation name and address
- Parent company
- Production route (primary vs. secondary aluminium; rolling, extrusion, remelting, etc.)
3) Embedded emissions (direct—and where applicable indirect)
During the transitional period, Commission Implementing Regulation (EU) 2023/1773 specifies the information to be reported, including:
- Specific direct embedded emissions
- Specific indirect embedded emissions (electricity-related), and the method/data source used
- Whether default values were used, and why
Implementing Regulation (EU) 2023/1773 (EUR-Lex): https://eur-lex.europa.eu/eli/reg_impl/2023/1773/oj/eng
Important nuance for aluminium:
- CBAM treatment of indirect emissions has been politically and technically contentious for metals, and the exact treatment can shift via implementing acts and updates. Importers should follow the Commission’s latest methodology publications and the CBAM Registry guidance.
Start from the Commission “CBAM legislation and guidance” hub: https://taxation-customs.ec.europa.eu/carbon-border-adjustment-mechanism/cbam-legislation-and-guidance_en
4) Smelter origin and electricity mix (the “hidden” drivers of aluminium emissions)
For aluminium packaging, the emissions profile is often dominated by electricity used in primary production. Even when your immediate vendor is a can-maker or rolling mill, EU importers will push upstream:
- Primary metal source(s): smelter name(s), country(ies)
- Alumina/refining route details (when requested)
- Electricity mix used by the producing installation (grid vs. on-site generation vs. PPAs)
- Evidence/assurance approach used (metering, supplier-specific emission factors, third-party verification)
5) Recycled content and scrap type (post-consumer vs. pre-consumer)
A high recycled-content strategy can reduce embedded emissions, but CBAM and EU policy discussions also focus on the quality and type of scrap.
Your suppliers should be able to document:
- % recycled content by mass, and the accounting approach
- Breakdown: post-consumer vs. pre-consumer scrap where available
- Chain-of-custody documentation supporting recycled inputs
6) Carbon price paid in the country of origin (if any)
CBAM allows the importer to claim reductions to avoid double carbon pricing where a carbon price was effectively paid in the country of origin, subject to proof and EU rules.
If any upstream carbon pricing applies, gather:
- Type of carbon pricing instrument (tax, ETS, levy)
- Amount paid and scope covered
- Proof documents and payment period alignment
Commission updates and consultations on carbon price paid abroad: https://taxation-customs.ec.europa.eu/news/cbam-call-evidence-emission-methodology-free-allocation-adjustment-and-carbon-price-paid-third-2025-08-29_en
How CBAM reporting works operationally (2025 reporting vs. 2026 compliance)
2025: quarterly CBAM reports in the Transitional Registry
In 2025, EU importers (or their representatives) submit quarterly CBAM reports via the CBAM Transitional Registry. Access is controlled at Member State level.
Example (Belgium) overview of the transitional registry function: https://climat.be/cbam-en/cbam-registry/cbam-transitional-registry
If you are a U.S. exporter, you won’t file directly—but your ability to sell into the EU will increasingly depend on whether your importer can file accurate reports.
2026: authorised declarant status and certificate economics
From 2026 onward:
- Importers (or indirect customs representatives) should obtain authorised CBAM declarant status to import CBAM goods.
- Embedded emissions drive certificate needs and cost exposure.
- Certificate prices are designed to track the EU ETS carbon price through Commission rules on calculation and publication.
Commission CBAM page emphasizing 2026 start and authorisation urgency: https://taxation-customs.ec.europa.eu/carbon-border-adjustment-mechanism_en
Contracting reality: CBAM cost is an importer obligation—but pricing pressure flows upstream
Legally, CBAM certificate surrender is borne by the EU importer/authorised declarant. Commercially, EU buyers will try to:
- pass CBAM costs back to suppliers via pricing,
- demand emissions reductions, or
- switch to lower-carbon packaging suppliers.
For THC beverage brands, this becomes part of the “cost-to-serve Europe.” The most defensible approach is to negotiate who owns which data, who pays which compliance costs, and what happens if data is missing.
CBAM meets recycled-content strategies (and why “100% recycled” claims still need documentation)
Many beverage brands plan to mitigate carbon exposure by moving to higher recycled-content aluminium.
CBAM implications:
- Recycled content can reduce embedded emissions, but only if the producing installation’s emissions calculation and documentation support it.
- If you cannot provide acceptable supplier data, importers may revert to default values, which are widely expected to be conservative and can increase apparent emissions (and later certificate cost).
Actionable takeaway: the sustainability story must be matched by CBAM-grade MRV (monitoring, reporting, verification) evidence.
CBAM meets PPWR: recyclability grades, labelling, and why sleeves/wraps matter
Even if you solve CBAM embedded-carbon reporting, you still must design packaging to meet the EU’s packaging rules.
The EU’s Packaging and Packaging Waste Regulation, Regulation (EU) 2025/40, entered into force in February 2025 and is scheduled to apply from 12 August 2026 (with some obligations phased in).
Commission PPWR overview: https://environment.ec.europa.eu/topics/waste-and-recycling/packaging-waste/packaging-packaging-waste-regulation_en
EUR-Lex summary for Regulation (EU) 2025/40: https://eur-lex.europa.eu/EN/legal-content/summary/packaging-and-packaging-waste-from-2026.html
Why PPWR intersects with CBAM for aluminium cans:
- PPWR pushes “design for recycling,” performance grading, and labelling harmonisation over time.
- Packaging components that reduce sorting or recyclability (e.g., full-body shrink sleeves, difficult-to-remove labels/adhesives, mixed-material components) can increase EPR fees and limit market access.
- Deposit return systems (DRS) and high collection rates strengthen the business case for can-to-can recycling, which in turn supports lower-carbon aluminium inputs.
Timeline reminders for packaging teams:
- 12 August 2026: PPWR begins applying broadly (key compliance milestone for EU market access)
- 12 August 2028 (commonly referenced in guidance): start of harmonised label requirements (subject to implementing acts)
- 2030+: recyclability and performance-grade requirements tighten further
Supplier questionnaire template: CBAM + can packaging data request
Use the following questionnaire as a starting point for your can supplier, rolling mill, or aluminium sourcing partner. Adapt it to your specific CN codes and trade flows.
A) Company and facility identification
- Legal entity name, address, and primary contact
- Facility(installation) name and address producing the aluminium product supplied
- Role in supply chain: smelter / remelter / rolling mill / can manufacturer / broker
- Countries of production and shipment
B) Product scope
- Product(s) supplied (e.g., can sheet, ends stock, foil, empty cans)
- Associated customs codes used in EU imports (CN/TARIC if known)
- Annual volume supplied for EU-bound products (tonnes)
- Production route (primary aluminium, secondary aluminium, mixed)
- Share of scrap input (% by mass), and scrap type breakdown:
- Post-consumer scrap %
- Pre-consumer scrap %
- Primary aluminium origin details (if any): smelter name(s), country(ies)
- Alumina/refining origin details (if available)
D) Energy and electricity
- Total electricity consumption attributable to the product (MWh/tonne)
- Electricity sourcing approach:
- Grid only
- On-site generation
- PPA/renewable certificate-backed supply
- Emission factor used for electricity (tCO2e/MWh) and source of factor
E) Embedded emissions (CBAM methodology readiness)
- Specific direct embedded emissions (tCO2e/tonne) for the product
- Specific indirect embedded emissions (tCO2e/tonne) where applicable
- Methodology used:
- EU CBAM methodology
- Equivalent method (if permitted for the period)
- Default values (only as fallback)
- Data quality statement (system boundaries, allocation approach, assumptions)
F) Verification and assurance
- Is the emissions data verified by a third party? If yes:
- Verifier name
- Standard/assurance level
- Verification period
- Can the supplier provide an emissions data package compatible with EU importer reporting?
G) Carbon price paid
- Any carbon price paid in the country of origin related to the product’s embedded emissions?
- Proof documents available (tax receipts, ETS surrender evidence, etc.)
- Can decoration and labels: inks, coatings, sleeves—material composition
- Instructions for recycling compatibility (e.g., sleeve removability, adhesive specs)
- Any recyclability testing or third-party recyclability assessment
Decision tree: shifting CBAM obligations and costs in your EU export contracts
Use this decision tree as a negotiation tool with EU distributors/importers and with packaging suppliers.
Step 1: Who is importing the CBAM good?
- If your EU partner imports empty cans / can sheet / foil into the EU: they are likely the importer of record and CBAM declarant unless they appoint an indirect customs representative.
- If you sell DDP (delivered duty paid) into the EU and you (or your logistics provider) become the importer: you may be the party facing CBAM compliance.
Step 2: Who will be the CBAM declarant?
- Option A: EU customer is authorised CBAM declarant and files
- Option B: Indirect customs representative agrees to act as declarant
Contract term to consider: require written confirmation of declarant identity and registry readiness.
Step 3: What happens if emissions data is missing or unusable?
- If supplier data is unavailable, the importer may use default values (often costlier).
Contract term to consider:
- Data-delivery SLA (timelines, formats)
- Right to audit / request corrective data
- Price adjustment mechanism if default values must be used due to supplier failure
Step 4: Who pays CBAM certificate costs (and how are they priced)?
- CBAM is legally importer-side, but commercial terms can allocate cost.
Common approaches:
- EU buyer pays CBAM but negotiates a unit price reduction
- Supplier rebates CBAM costs above an emissions “baseline”
- Shared-risk model with a cap and collar
Contract term to consider: define “CBAM cost” precisely (certificates price basis, period, benchmark adjustments, treatment of carbon price paid abroad).
Step 5: Recycled-content and packaging redesign decisions
- If moving to higher recycled content reduces emissions, decide who funds qualification, testing, and line trials.
Contract term to consider: joint sustainability roadmap with milestones tied to embedded emissions targets and PPWR design requirements.
Enforcement and risk: what can go wrong in 2025–2026
For THC beverage brands, CBAM risk is rarely a single fine—it’s a supply disruption risk.
Key failure modes:
- The importer cannot obtain authorised declarant status in time, delaying imports.
- Supplier emissions data arrives late or lacks installation-level traceability.
- Default values are used, raising embedded emissions and certificate cost (and triggering margin disputes).
- Packaging redesign for PPWR is delayed, forcing emergency SKU changes.
The Commission has signaled that CBAM has moved from pilot to real system, with CBAM Registry integration into customs systems now operational.
Commission news on CBAM entering force in 2026: https://taxation-customs.ec.europa.eu/news/cbam-successfully-entered-force-1-january-2026-2026-01-14_en
Business takeaways for 2026 EU market plans
For U.S. THC beverage brands
- Treat EU CBAM aluminum beverage cans THC drinks reporting as a cross-functional project: packaging, procurement, finance, logistics, and compliance.
- Build a supplier data pipeline now: installation identity, embedded emissions, electricity factors, recycled content documentation.
- Update EU commercial contracts to explicitly allocate CBAM reporting duties, certificate cost risk, and data failure remedies.
For EU importers/distributors
- Confirm CN codes and whether cans/can inputs are CBAM goods.
- Ensure authorised CBAM declarant readiness (or engage an indirect representative willing to take the role).
- Lock in supplier data/verification early so you’re not forced into defaults.
Next steps
If you are exporting THC beverages to the EU (or planning a dispensary rollout via EU channels), CBAM is no longer optional homework—it’s a cost driver and a gatekeeper.
Use CannabisRegulations.ai to:
- map CBAM exposure by product and packaging input,
- build supplier questionnaires and data workflows,
- track EU CBAM and PPWR regulatory updates, and
- maintain a defensible compliance record for import partners.
Start here: https://cannabisregulations.ai/
