BUSINESS | ORIENT. As of January 1, 2026, the European Carbon Border Adjustment Mechanism (CBAM) entered the full implementation phase. This means that carbon-intensive production of cement, steel, and fertilizers will soon have to be paid for when imported into the EU. However, in January, the European Commission presented a draft Article 27a, which could become a lifeline for many exporters.

What is "Emergency Brake" (Article 27a)?

Europe understands that abruptly introducing a carbon tax could drive up prices on everything from housing to bread. The new regulation allows Brussels to temporarily exempt goods from the tax if: Prices on the EU market have risen sharply. The domestic economy has suffered "serious and unforeseen damage."

Why Is This Important for Turkmenistan?

Turkmenistan is actively developing exports of products classified in the CBAM "red zone."

Fertilizers and ammonia: These are our main export products in the chemical industry. Major EU countries (France and Italy) are already calling for imported fertilizers to be exempt from the carbon tax to save their farmers. Article 27a provides the legal basis for this to be done quickly.

Cement and construction materials: Large-scale construction in Europe could increase demand for our cement, and if prices within the EU become unaffordable, the carbon tax could be temporarily eliminated.

The Biggest Surprise: The Law Can Be Effective Retroactively

Article 27a includes a retroactive mechanism. This means that if the European Commission decides to abolish the tax on a product in June, the decision could be effective as of January.

Important for Business: If an importer in Europe has already purchased special CBAM certificates (tax) for Turkmen urea, and then the product is exempted from the tax retroactively, the money must be refunded.

Recommendations for Turkmen Companies:

2026 is the last year for us to report emissions. Financial payments will begin in 2027.

Flexible Contracts: Include in contracts with European partners the terms for price revisions if Article 27a is activated.

Transparent Accounting: Even if the tax is abolished, carbon footprint reporting will still be required for market access.

Brussels Monitor: Follow the news from the European Parliament. The list of "preferential" goods will change dynamically.

Checklist: Is Your Export Department Ready to Work with the EU in 2026?

Go through the steps to determine whether your product will be left out in the cold on the European market:

1.Monitoring HS codes: Check whether your product is on the current CBAM list. This list may expand by mid-year.

2.Carbon footprint audit: Do you have data on direct and indirect emissions from production? From 2026, reporting to the EU without these figures will not be accepted.

3.Legal flexibility: Do your contracts specify who pays for CBAM certificates—you or your European buyer? (We recommend including a clause regarding price revisions when Article 27a is activated.)

4.Accredited verification: Do you have connections with laboratories or experts whose emissions calculations are recognized in the EU?

5.Financial Reserve: Is there a provision in the 2027 budget for purchasing certificates (in case the “emergency brake” does not work for your product)?