Prepare early for UK CBAM compliance
The UK Carbon Border Adjustment Mechanism (UK CBAM) is expected to come into force on 1 January 2027, with no transitional phase. This means businesses will face financial obligations from the first year of reporting.
Although the legislation has not yet been formally adopted, early preparation is essential to avoid disruption, unexpected costs, and supply chain risks.
As currently proposed, the UK CBAM will:
- Start on 1 January 2027
- Apply immediately to emissions reported for 2026
- Include no transitional reporting-only period
Businesses importing in-scope goods should begin preparing now to ensure data availability, supplier readiness, and financial planning ahead of implementation.
To prepare for UK CBAM, businesses should:
- Check their obligation
Review the UK CBAM in-scope commodity code list to determine whether imported goods fall under the mechanism. - Engage suppliers early
Work with in-scope suppliers to identify emissions data gaps and improve data quality across the supply chain. - Forecast CBAM costs
Estimate future CBAM liabilities to support budgeting and long-term financial planning. - Monitor policy developments
Stay informed as UK CBAM legislation and guidance evolve.
How Valpak can help with UK CBAM
Preparing for UK CBAM can be complex, particularly where supplier data is limited or fragmented. Valpak offers a tailored UK CBAM compliance service to help businesses prepare with confidence.
Our services include:
- Obligation identification and calculation
Clear confirmation of which goods are in scope and the potential impact on your business. - Supplier engagement
Direct support working with your suppliers to obtain and pre-verify emissions data. - Cost forecasting
Practical estimates to support financial provisioning ahead of 2027. - Pre-verification support
Helping ensure both your business and your suppliers are verification-ready, working with trusted independent auditors.
FAQs
The UK CBAM is set to come into effect on 1 January 2027 with financial implications. The draft primary legislation has been submitted to Parliament as part of the Labour government’s 2025-2026 Finance Bill, but has yet to be adopted. A secondary draft is expected later this year with additional details, including default values, benchmarks, and registration requirements.
The UK CBAM Regulation targets cement, iron/steel, aluminium, fertilisers, and hydrogen imports based on their CN (Combined Nomenclature) codes. A full list of obligated codes can be found here.
The UK CBAM threshold is based on import value, unlike the EU threshold which is based on import weight. The UK threshold is currently set at £50,000 of imported goods over a twelve-month period. A business will face a UK CBAM obligation if it imports over £50,000 worth of flagged goods.
The UK CBAM will introduce default values as part of its CBAM regulation; however, a full list is not currently available as the regulations are still under review. We recommend using the EU’s default values to provide an estimate given the similarities between the two frameworks.
The UK and EU announced plans to align their ETS systems last year, which will likely also affect their CBAM frameworks. However, an official regulatory update has yet to be announced. As the UK framework currently stands, EU CBAM costs would have to deducted from UK costs.
The UK CBAM’s implementation from January 2027 with financial implications leaves little time for obligated businesses to prepare, making it essential to start early. Concerned businesses should:
- Check whether their imports fall under the scope of UK CBAM
- Survey suppliers to understand their emissions visibility
- Forecast costs to understand the true impacts of their obligations
Make an enquiry
Let us simplify UK CBAM compliance so you can focus on running and growing your business. Get in touch today to discuss UK CBAM support.