CBAM Fully Operational in the EU – What UK Businesses Need to Know

From January 2026, the European Union’s Carbon Border Adjustment Mechanism (CBAM) will move from its transitional reporting phase into its definitive regime. This marks a significant change for UK businesses trading with the EU, particularly those dealing in carbon-intensive goods. While CBAM has been on the horizon for some time, the shift to full implementation means financial liabilities, stricter controls, and higher compliance expectations.

UK exporters and EU importers alike should be using 2025 as a final preparation window.

What is changing in 2026?

Under the definitive regime, EU importers will no longer only report emissions data, they will be required to purchase and surrender CBAM certificates reflecting the embedded carbon emissions in imported goods. This effectively places a carbon price on certain imports, aligning them with EU environmental standards.

Although CBAM obligations formally sit with the EU importer of record, the practical burden will often fall across the entire supply chain — including UK exporters, manufacturers, and distributors, who must provide accurate emissions data.

Goods covered by CBAM

CBAM currently applies to imports into the EU of:

• iron and steel

• aluminium

• cement

• fertilisers

• electricity

• hydrogen

If your products fall under the relevant commodity codes, CBAM requirements will apply, regardless of shipment frequency or value.

Common compliance risks to avoid

Misunderstanding exemptions

The widely referenced 50-tonne de-minimis threshold applies only to the importer of record, not to individual factories, suppliers, or installations. Businesses exporting smaller volumes are frequently caught out by assuming they are automatically exempt.

Poor emissions data quality

From 2026, estimated or incomplete data will no longer be acceptable. Emissions figures must be calculated using approved methodologies and supported by verifiable information from production sites. This requires early engagement with suppliers — particularly where manufacturing takes place outside the UK.

Unclear supply-chain responsibilities

CBAM obligations differ depending on whether a business acts as an importer, exporter, stockholder, or manufacturer. A lack of clarity around contractual roles and Incoterms can lead to compliance gaps and unexpected costs.

What UK businesses should be doing now

• Review product classifications to confirm whether goods fall within CBAM scope

• Engage EU customers and importers to understand how responsibilities and costs will be shared

• Start collecting emissions data from suppliers and manufacturers without delay

• Assess contractual terms, particularly where DDP or carbon-cost pass-through clauses are used

• Invest in training or specialist support to prepare internal teams for ongoing CBAM reporting

  
  

Why early preparation matters

CBAM will influence pricing, competitiveness, and EU market access. Businesses that prepare early will be better positioned to manage costs, avoid shipment delays, and maintain strong trading relationships with EU partners. Those that delay risk disruption, financial exposure, and loss of customer confidence.

With 2026 fast approaching, CBAM should now be treated as a core customs and trade compliance issue, not a future sustainability initiative. At the Greater Manchester Chamber of Commerce, we are dedicated to supporting your successful CBAM implementation journey and fostering sustainable solutions for a greener future. Our tailored CBAM preparation services are designed to assist companies in planning for future needs and integrating these tools into their operational landscape.

If you have any questions or require assistance with CBAM, don't hesitate to reach out. We're here to guide you through the process and help you unlock the full potential of CBAM. Interested in CBAM training and compliance support? Email us at international@gmchamber.co.uk  to learn more and take the first step towards CBAM readiness.