CBAM and the United Arab Emirates

The United Arab Emirates supplies roughly eight percent of the aluminium the European Union imports, and aluminium drives Emirati exposure to the Carbon Border Adjustment Mechanism. Measured against the size of the economy, CBAM-covered exports represent around 0.53 percent of UAE GDP — the second-highest ratio in the Gulf. Steel, cement and fertilisers add to the picture.

Since 1 January 2026 the mechanism has been live. Emirati producers hold a genuine advantage in this environment: sustained investment in lower-carbon smelting means many UAE installations can supply verified emissions figures that compare favourably with competitors in Asia. That advantage reaches the European market most directly when the exporter controls the import itself.

What the definitive phase requires

Six sectors fall within scope today: cement, iron and steel, aluminium, fertilisers, electricity and hydrogen. Article 25 of the CBAM Regulation provides that customs authorities allow the importation of CBAM goods by an authorised CBAM declarant, and that declarant purchases its certificates from the competent authority in the EU Member State where it is established. The status applies where cumulative annual imports exceed 50 tonnes of CBAM goods, with electricity and hydrogen counting from the first unit.

The first annual declaration covers calendar year 2026 and falls due by 30 September 2027. Certificate sales open on 1 February 2027 through the common central platform. Since 1 January 2026, EU import declarations carry a CBAM code in the additional reference field.

What Emirati exporters gain from a Dutch entity

A UAE producer selling through European buyers depends on those buyers holding authorised declarant status and passing carbon costs back through price. A producer importing through its own Dutch BV sets the terms: it purchases certificates directly at the EU carbon price, presents its verified low-carbon figures as a commercial argument, and invoices European customers as a European supplier under EU VAT rules.

On aluminium volumes the Article 23 licence carries real weight. Import VAT moves to the periodic VAT return rather than falling due at customs clearance, which releases working capital on every consignment arriving in Rotterdam.

Structuring the ownership chain

One point deserves attention before incorporation. The Netherlands applies a conditional withholding tax to dividends, interest and royalties paid to affiliated companies in listed jurisdictions, and the United Arab Emirates appears on that list for 2026. The practical answer is to design the shareholding chain deliberately at the outset, so that profit repatriation runs through a route with treaty protection and genuine substance. The Netherlands and the UAE maintain a tax treaty covering income and corporate taxes, which remains relevant to the wider structure.

We map this chain before the notarial deed is drafted, so the structure is correct from day one rather than reorganised later.

Setting up in the Netherlands

A Dutch BV is incorporated by notarial deed and registered with the Chamber of Commerce (KvK). Incorporation runs remotely by power of attorney, with the parent company holding the shares. After registration the BV obtains its VAT number and EORI number and applies for the Article 23 licence and the CBAM authorisation. The same entity then serves as your base for EPR registrations under the Packaging Regulation and for your European contracts.

Further reading: an EU entity for CBAM and fiscal representation and Article 23.

Frequently asked questions

Can a UAE company import CBAM goods into the EU directly?

Importation of CBAM goods is reserved for authorised CBAM declarants, and the declarant purchases certificates from the competent authority in its EU Member State of establishment. A UAE company therefore either sells to an established EU buyer holding that status, or incorporates its own EU entity such as a Dutch BV.

How exposed is the UAE to CBAM?

CBAM-covered exports represent around 0.53 percent of UAE GDP, the second-highest ratio among Gulf states, and the exposure is driven by aluminium. The UAE accounts for roughly eight percent of EU aluminium imports.

Does the Netherlands have a tax treaty with the UAE?

Yes. The Netherlands and the United Arab Emirates maintain a double tax treaty covering income tax, wage tax, corporate tax and dividend tax on the Dutch side and income and corporate tax on the Emirati side.

What should a UAE group consider when structuring a Dutch BV?

The Dutch conditional withholding tax applies to dividends, interest and royalties paid to affiliated companies in listed jurisdictions, and the UAE is listed for 2026. Designing the ownership chain before incorporation, with treaty protection and genuine substance in place, keeps profit repatriation efficient.