The Carbon Border Adjustment Mechanism (CBAM) is fundamentally reshaping trade rules in the EEA. Norway, as an EEA member and participant in the EU ETS, is in a unique position. At the same time, the safeguard tariffs recently imposed by the EU on Norwegian ferro-alloys highlight the limitations of this cooperation.

CBAM

CBAM aims to align the carbon price applied in the EU with that applied to imports from outside the EEA. Its main purpose is to prevent carbon leakage, for example the relocation of energy-intensive production to countries with less stringent climate policies.

In EU, full implementation, including the obligation to purchase CBAM certificates, is scheduled for 1 January 2026.

While Norway plans to introduce CBAM from 1 January 2027, following a transitional phase.

The full scope of products covered by CBAM includes:

– Cement

– Electricity

– Fertilisers

– Iron and steel (including ferro-alloys)

– Aluminium

– Hydrogen

Norway’s Status in CBAM

The key factor is Norway’s dual status, as it is part of the EEA and participates in the EU ETS.

Because of participation in the EU ETS, Norwegian companies are covered by the EU ETS and already incur CO₂ emission costs under the same rules as EU companies.

Thanks to this, Norway is excluded from CBAM on export to the EU. Goods originating from Norway (and other EFTA countries such as Iceland and Liechtenstein that participate in the EU ETS) are excluded from CBAM when entering the EU. CBAM applies only to imports from Third Countries, that is, from outside this integrated climate area.

The 2026 Loophole: CBAM and Rules of Origin (RoO)

The one-year delay in CBAM implementation in Norway (2027) compared to the EU (2026) has prompted speculation about using Norway as a gateway to the EU for CBAM goods from Third Countries.

Legal analysis suggests that such a loophole is theoretically possible, but very difficult to exploit in practice and strictly constrained by customs rules on origin.

The key issue is RoO – Rules of Origin

The exemption of Norwegian goods from CBAM when exported to the EU is guaranteed only for products that have acquired preferential Norwegian or EEA origin.

To find more asnwers we have to look into PEM Convention Requirements.

Norway is part of the Pan-Euro-Mediterranean (PEM) Convention, which determines when goods acquire preferential origin.

For a good from a Third Country to be treated as of Norwegian origin, the following conditions must be met:

1. Sufficient working or processing
Simple operations such as transshipment, repacking or minor handling (for example simple cutting) are not sufficient to change the origin of the product.

2. Compliance with product-specific rules of origin (PSR)
For CBAM goods, these rules are strict. Typical requirements may include:

– Change in tariff classification, for example from a semi-finished product to a finished product (at the 4-digit or 6-digit tariff level).

– Value added requirement, for example a limitation that the value of non-originating materials cannot exceed 60 percent of the ex-works price.

– Specific processing requirement, for example for metallurgical products a process such as “melt and pour” may need to be carried out in Norway.

What the 2026 Gap Really Means

The one-year gap in 2026 can be used in a lawful way only by companies that are able to add significant value or perform the required technological processing of CBAM goods in Norway in line with the strict PEM Rules of Origin.

For most importers whose business model is based on simple logistics and transit, goods from Third Countries will remain goods from Third Countries. These products will continue to be subject to CBAM when they enter the EU, even if they pass through Norway.

Safeguard Tariffs vs CBAM

Separate from CBAM, the EU has imposed safeguard tariffs on imports of Norwegian ferro-alloys. This illustrates a fundamental divergence in Norway’s treatment:

Norway is part of the climate bloc through the EU ETS.

At the same time, it is treated as a Third Country for certain trade defence instruments.

Safeguard tariffs are applied to volumes of imports that exceed a specified quota. Unlike CBAM, they do not relate to CO₂ emissions, but to the quantity of goods imported.

CBAM and safeguard tariffs operate in parallel, but serve different policy goals. For Norwegian businesses trading CBAM goods or ferro-alloys with the EU, understanding this dual framework is crucial to managing compliance risks, optimising supply chains and making informed investment decisions.