EU Carbon Border Adjustment Mechanism (EU CBAM)

This page does not constitute legal advice and is provided for general information purposes only. Always check the latest official guidance from the European Commissionopens taxation-customs.ec.europa.eu in a new tab.

This page is intended to help UK goods exporters (specifically of: iron and steel, aluminium, cement, fertilisers and hydrogen) understand the EU Carbon Border Adjustment Mechanism (CBAM) and identify relevant information and EU guidance to comply with it.

References to 'UK goods exporters' or 'UK businesses' in this document includes businesses based in Northern Ireland who are supplying products to EU customers. Goods and traded electricity sent from Great Britain to Northern Ireland are not affected by EU CBAM.

This page does not cover traded electricity. For traded electricity specific information, refer to the latest official guidance from the European Commissionopens taxation-customs.ec.europa.eu in a new tab.

Overview

The EU CBAM, formally known as EU Regulation 2023/956, is a climate policy tool that applies a carbon price on certain goods imported into the EU. It ensures that imported goods whose production is at the greatest risk of carbon leakage (when production and associated emissions shift from one country to another due to different levels of decarbonisation effort) face similar carbon emissions-related costs as those produced in the EU.

The following goods are currently in scope of the EU CBAM:

• iron and steel
• aluminium
• cement
• fertilisers
• hydrogen
• traded electricity (not in scope of this page)

The implementation of the EU CBAM has been divided into 2 phases:

1. Transitional phase (1 October 2023 to 31 December 2025): EU importers must report greenhouse gas emissions (’emissions’) embedded in their imported goods (direct and indirect emissions), without the need to pay any financial adjustment
2. Definitive regime (from 1 January 2026): EU importers must continue reporting and purchase CBAM certificates to cover the emissions embedded in their imported goods

Who should comply

The regulation applies to EU importers, however they may seek information to support them in meeting these requirements from all parties involved in the supply and import of products within scope.

This includes:

• EU importers ('declarants' under CBAM rules)
• manufacturers of covered goods
• exporters to the EU
• customs brokers and authorised representatives

Impact on UK exporters

To comply with EU CBAM from January 2026, EU importers must:

• maintain records and tracking of embedded emissions from the point of import
• purchase and surrender CBAM certificates to cover embedded emissions and submit annual declarations (the first being due by May 2027 for goods imported in 2026)

EU companies importing less than 50 tonnes of CBAM goods per year are exempt from CBAM obligations. Hydrogen and traded electricity are outside this exemption.

What may be required of you

While the EU importer is responsible for ensuring EU CBAM requirements are met, your CBAM goods could be delayed at customs, blocked at the EU border or non-compliance may lead to penalties for EU importers in your supply chains. Proper preparation will help avoid disruption to your business and customers.

You may be requested to provide emissions data and evidence of a carbon price already paid under the UK Emissions Trading Scheme to support your EU customers with their compliance. You may be required to provide information to your EU customers even in the case that you export less than 50 tonnes of CBAM goods to the EU as your EU customers might import more than 50 tonnes of goods annually.

You may wish to speak to your EU customers to understand what information they need from you to meet their CBAM obligations.

Checklist to help support EU importers with EU CBAM compliance

If you are a UK business making or exporting CBAM goods to the EU, it is important that you conduct an internal review and support your EU importer to comply with the new EU CBAM regulations by providing the necessary paperwork, including emissions data, to satisfy EU authorities, upon request.

Depending on what is requested by your EU importer, you might need to consider:

• reviewing your export portfolio: check if your products are in scope (specific products within the iron and steel, aluminium, cement, fertilisers, traded electricity and hydrogen sectors)
• collecting and verifying data: consider if you need to calculate and record embedded emissions or UK carbon prices already paid according to EU CBAM requirements (or both) and seek mandatory third-party verification by accredited verifiers recognised under EU accreditation frameworks. Keep records ready in case additional checks are requested
• supporting your EU importer: supply timely and accurate verified data for quarterly CBAM reporting until the end of 2025 and for annual declarations from 2026, upon request. Respond quickly if any issues are flagged such as data discrepancies to avoid disruption
• auditing your supply chain: assess where emissions reductions are possible to lower future CBAM costs
• training your team: ensure relevant staff understand EU CBAM and what information your EU importer might need

EU Commission resources

Information on the EU CBAM can be found on the European Commission websiteopens taxation-customs.ec.europa.eu in a new tab.

This includes:

• dedicated guidance pageopens taxation-customs.ec.europa.eu in a new tab
• self-assessment toolopens taxation-customs.ec.europa.eu in a new tab
• sector specific informationopens taxation-customs.ec.europa.eu in a new tab
• CBAM Registry and Reporting pageopens taxation-customs.ec.europa.eu in a new tab, where you can find more information on reporting requirements
• list of National Competent Authoritiesopens taxation-customs.ec.europa.eu in a new tab (note that importers must register with the relevant National Competent Authorities in the EU member state where they are established)

If you are a non-EU installation operator, there is a dedicated section in the EU CBAM Registryopens ecas.ec.europa.eu in a new tab where installation operators based outside the EU can upload and share their installations and emissions data with importers. The EU has provided a step-by-step guide and e-learning modulesopens taxation-customs.ec.europa.eu in a new tab to assist with this process.

There is a wide range of e-learning materials and recorded webinars that you can access at your convenience on the Customs and Tax EU Learning Portalopens customs-taxation.learning.europa.eu in a new tab.