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Carbon Border Adjustment Mechanism (CBAM) FAQs – What UK Exporters Need to Know

What is CBAM? 

CBAM is a policy tool designed by the EU, which came into force in October 2023, to address carbon leakage and ensure that the price of carbon emissions is consistent both within the EU and on imported goods.  


What products does it cover?  


CBAM targets imports of specific goods and sectors that are at high risk of carbon leakage. Initially, this includes energy, hydrogen, cement, iron and steel, aluminium and fertilisers. This can also cover service companies with IT products and things such as promotional aluminium signage. The scope is expected to expand from 1st January 2026 with all goods covered by the end of 2030.  


Will CBAM apply to all non-EU origin goods?  


It will apply to all non-EU origin goods except those that originate from Switzerland, Iceland, Norway and Lichtenstein.   


Is there a threshold? 


Any consignments over 150 euros.  


What is the impact for UK businesses trading with the EU?  


If you are a UK manufacturer selling to the EU directly you will need to provide the necessary emissions calculation. An UK distributor will need to pass the emissions data from the manufacturer/supplier to its customer within the EU. The importer of record is responsible for completing the CBAM declaration along with the customs declaration. 


If you are part of a global supply chain, it is also likely your partners across the globe need to be briefed and introduced to this new regulation. 


What are the requirements?  


Most of the requirements will be around the registration and reporting for the importer of record. Firms importing into the EU must submit the necessary documents to register for CBAM reporting, they will then be granted access to the transitional registry to submit the reports, the goods can then be imported. Reports are submitted quarterly and the deadline is one calendar month after the quarter has finished. The next CBAM report is due at the end of July 2024 and will cover all imports from 1st April to 30th June 2024.  


What does the report cover?  


The report has three main categories:  


  1. Includes information that is likely to be on the customs declaration such as HS code, weight and country of origin  

  1. This covers the emissions data, for now importers can use default values from EU commission, however this can’t use this from July onwards.  

  1. This is not currently mandatory but where available addresses the carbon price paid during manufacturing process. Eventually this will be used and should help to reduce CBAM cost as it will look at where carbon emissions have already been paid in the manufacturing process. However, getting this data per consignment is likely to be challenging.     


What are the key dates in 2024 for the transitional phase?  


From the 31st July 2024 there will be the introduction of the requirements to use embedded emissions data for October report for anything entering the EU from 1st July 2024. This will likely involve discussions with suppliers and not just customs data.   


After the 31st December 2024 we will see the introduction of the mandatory use of the EU framework for calculating embedded emissions.  


Are any other countries considering CBAM?  


The UK is currently in consultation to bring in UK CBAM in 2027, Australia is looking at bringing CBAM in 2026 and the US and Canada are also considering CBAM.  


Need Help understand CBAM and what it means to your business? 


We have designed a number of events, training and services to help you understand and prepare: 


  • Chamber Trade Academy: CBAM- 18th June, 11am-12pm, Online, register here.  

  • CBAM Training- 3rd July, 9.30am-12.30pm, Online, this course will include how to collect CBAM data from suppliers and how to prepare reports. Book your place here  

  • Need help on how to prepare reports for your EU customers?  We have also now launched a new consultancy service to help UK traders to prepare and adapt their systems and processes to this new requirement. You can email or call 0161 393 4314 for further information  

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