For importers/ CBAM declarants, the hard part in the CBAM compliance process is getting the data from the operators of non-EU installations/ suppliers by July 2024. Here are Vis-map, we understand and emphasize the difficulty and are equipped with the expertise and technology to aid you in fulfilling your obligations.
To start you need to know what is required for your CBAM reporting:
- Direct Emissions (e.g. coal, waste gas, natural gas combusted in furnaces)
- Indirect Emissions (e.g. electricity used for production)
- Embedded emissions of the precursor materials (e.g. raw materials)
- Relevant Parameters – different for each product group (e.g. scrap content)
- Any paid carbon price for producing the product (e.g. carbon tax , ETS certificate)
Fasteners (CN7318) Case Study
For example if you import iron screws from Turkey (non-EU countries)into EU, it is broadly classified under CN 7318 and you would need to get direct , indirect, and embedded emissions as well as relevant parameters and carbon price paid of the specific production process.
Most fasteners manufacturers purchased steel rods or wires from suppliers which could be distributers/forming suppliers/ iron smelters. It is important to note that CBAM is targeted mainly at the smelter suppliers which can be a tier 2 to tier 5 supplier. This means that the CBAM declarant would have to follow down his supply chain to obtain the necessary data.
The EU commission do note the difficulty in such data collection and have launched a set of guidance documents including the CBAM communication template for installations excel that can be used by the different tiers of suppliers. In addition, for each sector such as the iron and steel industry, they published e-learning module and webinar to aid in this transition period CBAM data collection.
With all these available resources , is all well with implementing the CBAM data collection ?
Unfortunately, there are still hurdles to overcome:
- Lack of knowledge and competency on Greenhouse Gas Calculation methodology. Yes, EU has released guides on this, however it do take patience and resources to learn, calculate and fill the CBAM communication template.
- Tracing the Supply Chain to get the precursor/ production routes that is mandatory under the CBAM regulations.
- Effort vs Penalty consideration. For high value, light commodity parts that are imported irregularly, the effort for the suppliers to go through the CBAM process might be very tenacious , especially if it is beyond their own tier 1 supplier.
Vis-map is here to help you trace your supply chain to get to the CBAM mandatory production routes for each sector and automate the CBAM data collection process such that the lack of knowledge and competency will be overcome with ease of our AI technology.
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