Although the regulation on the Carbon Border Adjustment Mechanism (CBAM) has been in force for more than a year and a half, experience shows that a significant number of importers in Hungary have still not fulfilled their obligations. The grace period is over: the National Climate Protection Authority is increasingly reaching out to companies with formal notices — which may be followed by substantial fines.
CBAM Compliance Is Not Optional – why are you receiving a formal notice?
The aim of the CBAM regulation is to support the EU’s decarbonisation efforts and to regulate the import of carbon-intensive products. Affected businesses are required to register on the EU’s CBAM platform and submit quarterly reports on the import of carbon-intensive goods.
However, many have failed to meet these obligations — estimates suggest that around half of the affected companies, or even two-thirds according to more cautious estimates, have not yet addressed the issue. These companies are now receiving formal notices from the authority. After receiving a notice, companies must comply with the requirements — typically retroactively as well — within a strict deadline.
Failing to take CBAM compliance seriously is a major mistake. The National Climate Protection Authority may impose significant fines on companies that fail to complete their registration and submit the required quarterly reports.
This also means that preparation can no longer be postponed — especially for those who may not have even realised they fall within the scope of CBAM.
The Transitional Phase Is Coming to an End – CBAM Financial Obligations Begin in 2026
The CBAM regulation is currently in its transitional phase, during which importers are only subject to reporting obligations. However, this period will end by the close of 2025.
Starting in 2026, CBAM will also involve financial obligations — meaning that businesses will be required to pay for the emissions reported in relation to their imports.
The period so far could be seen as a grace period, as neither the EU nor the national climate authority actively reached out to free riders or non-compliant businesses.
However, the situation has changed, and — likely prompted by signals from the EU — the national climate authority is now increasingly sending letters to companies that fall under CBAM obligations but have either failed to comply or only partially fulfilled their duties.
The authorities know who’s non-compliant – Customs data doesn’t lie
The range of products covered by CBAM and the related import volumes can be tracked based on data from the EU customs system. The National Tax and Customs Administration, the National Climate Protection Authority, and EU institutions all have a clear picture of which businesses have imported CBAM-regulated products — and which of them have failed to meet their reporting obligations.
The formal notices are sent specifically to these companies.
Those who receive a notice to remedy non-compliance must fulfil their obligations — retroactively as well - within a strictly defined deadline.
Why is CBAM compliance so difficult?
Businesses have found it challenging to comply with CBAM obligations, as very few regulatory requirements must be fulfilled directly on an EU-operated platform. One of the main difficulties lies in the CBAM platform itself, which is managed by the EU: it is primarily in English and is not user-friendly. The interface is complex, support options are limited, and users often encounter numerous error messages and a large number of mandatory fields that must be completed.
An even greater challenge is that the emissions data required for reporting is typically not readily available to importers. This information must be obtained from foreign manufacturers, who are often either unwilling or unable to provide reliable, verified data. As a result, importers frequently find themselves engaged in endless correspondence and follow-up — often without obtaining any meaningful information in the end.
What’s even more concerning is that the introductory, transitional phase of CBAM is coming to an end by the close of this year. This also means that businesses already have tasks to address in preparation for 2026, when CBAM enters into its full implementation phase — which will involve not only reporting obligations but also actual financial payments.
Many businesses have not only failed to begin preparing for 2026 — they are not even aware that they have already been subject to CBAM obligations. In fact, they are now in default for seven reporting quarters, and these missed reports must be submitted retroactively.
CBAM compliance is not limited to registration and data submission to the EU — it is a far more complex and currently highly demanding process.
The challenges of CBAM reporting
At the heart of CBAM reporting lies the obligation for importers to provide information about the imported goods and the emissions generated during their production. While customs documents are typically available for imported goods, importers generally have no direct access to information about the foreign manufacturer or the emissions produced during manufacturing.
These emissions data must be obtained from the manufacturer during the import process. In practice, this proves extremely difficult in approximately 50% of cases. Importers often encounter endless email exchanges and confusion from exporters or manufacturers when requesting emissions data for CBAM reporting purposes.
The CBAM framework assigns the reporting obligation to the importer, yet the crucial emissions data is held by the manufacturer — who is often not even the same entity as the exporter. Obtaining emissions data from the foreign manufacturer is not impossible — but it is extremely difficult, and under the CBAM rules, the responsibility lies entirely with the importer. In most cases, the only chance of acquiring the necessary information is to somehow persuade the trading partner to provide the emissions data for the manufactured products within a timeframe that is actually workable for CBAM reporting purposes.
The biggest question arises only after that: how reliable are the submitted data? At present, there is no realistic way to verify their accuracy.
This question is, for now, largely irrelevant for companies subject to CBAM, as for most importers it is already a significant achievement to meet their CBAM reporting obligations on a quarterly basis.
During a single quarterly reporting period, numerous questions may arise, which can be directed to the National Climate Protection Authority. In my experience, they respond in a fair, timely, and efficient manner — within the limits of their capacity — especially when it comes to inquiries related to error codes.
There is a solution – But it’s difficult without advisory support
CBAM compliance is not merely a legal or technical task — it’s a new and complex reporting regime that few companies are equipped to handle on their own without professional support. Based on our experience, businesses that have already received a formal notice find it extremely difficult — or nearly impossible — to resolve their missed obligations without expert help.
In our professional opinion, it is almost hopeless for a company to manage CBAM compliance retroactively on its own after receiving a letter from the Authority.
Those who act now are still on time. Understanding the reporting system, navigating the CBAM platform, and establishing efficient communication with foreign partners are all areas where advisory support can significantly reduce the time and resources required — and help avoid penalties.
CBAM fines are coming – It pays to act now
The current wave of notifications is still focused on encouraging compliance. The next stage, however, will involve enforcement — and potentially substantial financial penalties. CBAM is not a recommendation or an administrative formality; it is a binding regulation, and the authorities are increasingly proactive in monitoring its implementation.
If you're uncertain whether your company imports CBAM-regulated products — or if you need support in fulfilling your reporting obligations — it’s time to turn to a trusted advisor.
The CBAM advisory team at RSM Hungary offers up-to-date knowledge and hands-on experience to help you navigate the complexities of the Carbon Border Adjustment Mechanism.
