"This is a disaster": Estonian companies have not explained the EU carbon duties

Starting from January 1 next year, about 130 Estonian companies must have a permit to operate under the Cross-Border Carbon Regulation Mechanism (CBAM) in order to continue importing from outside EU products that are subject to carbon duties. However, so far only a tenth of companies have submitted applications. They don't know how to do it, and they call the situation catastrophic.

In 2026, the CBAM comes into force in the EU — a duty on carbon emissions on some imported products.

"According to data from last year, there are about 130 enterprises in Estonia that annually import more than 50 tons of such products. Thus, by the new year they must apply for a permit and pay the tax. However, few have done this," the Estonian ERR reports.

"At the moment, we have received 12 applications, and to date we have issued four such permits. The rest are still under consideration. It is important to remember that the review procedure can take up to 120 days, so the application should not be delayed," said Annika Konovalov, head of the climate Bureau of the Environment Department.

The owner and head of Metaprint, Martti Lemendik, told ERR that it is not so easy to apply - because there are no instructions for this.

"The number of fields to fill in there is simply enormous. But in fact, it is not necessary to fill in all these fields, but which ones are needed and which are not — no one explained this to entrepreneurs. There are simply no instructions or training materials," the businessman said.

Silver Alamaa, the owner of Laomeister, believes that the situation has become a disaster for small businesses.

"We are a small company, we do not have administrative resources, we have to do real work. But I had to spend hours on the Internet trying to figure out what was going on. But even now it remains unclear even what the amount of this tax will be in 2026. And the worst thing for a small entrepreneur is the unknown. The unknown is the death of a small business," Silver Alamaa said.

Martti Lemendik confirmed that the amount of the tax remains unclear.

"We are simply stopping the purchase of materials from outside the European Union. Now we are doing this in relatively small volumes. Mostly from outside EU comes only packing steel from Taiwan," said the owner of Metaprint.

The ERR noted that it is really extremely difficult for entrepreneurs to predict the amount of tax, since it is calculated using a complex formula and depends on constantly changing prices for CO2 emissions.

It is known that starting next year, carbon duties will begin to apply to imports of cement, iron and steel, aluminum, fertilizers, electricity and hydrogen to the EU. In the future, tariffs are planned to be extended, including for gas. Qatar has already announced that it will stop LNG supplies if it falls under EU restrictions and duties. At the same time, Russia filed an appeal to WTO on solutions The EU will introduce a carbon duty.