UK CBAM Step-by-Step Guide: How to Check Your Obligations

The UK Carbon Border Adjustment Mechanism (CBAM) is a new carbon reporting framework that will apply to certain imported goods. Businesses importing affected products may need to gather emissions data, engage suppliers and submit CBAM reports.

This guide breaks the process down into clear, manageable steps so you can understand your obligations and prepare with confidence.

Step 1: Understand what the UK CBAM is

The UK CBAM introduces a carbon-related charge on certain imported goods based on the emissions generated during their production outside the UK. Its purpose is to create a more level playing field between UK manufacturers and overseas producers operating under different carbon pricing systems.

What you’ll learn

• Why the UK CBAM has been introduced
• Which products are in scope
• How it differs from existing carbon regulations
• Key reporting timelines

Step 2: Determine whether your business is in scope

The UK CBAM targets specific carbon-intensive sectors, including:

• Aluminium
• Cement
• Fertilisers
• Hydrogen
• Iron and steel

If your business imports products manufactured from these materials, you may have obligations under the scheme.

Quick check

Ask yourself:

• Do we import products into the UK?
• Do any imports contain CBAM-regulated materials?
• Are we responsible for customs declarations?

If the answer is yes, continue to Step 3.

Step 3: Check your commodity (CN) codes

Whether your products fall within scope is determined by the Combined Nomenclature (CN) codes assigned to imported goods. These codes are used by customs authorities to classify products for import purposes.

Useful resource

Download: UK CBAM CN Codes

What to do next

1. Identify the CN codes used for your imported products
2. Compare them against the official CBAM list
3. Record any matching products

Step 4: Check the value of your imports

If you identify products with CBAM-covered CN codes, the next step is to calculate the total annual value of those imports.

Businesses whose relevant imports exceed the applicable threshold may have reporting obligations.

Actions

• Review import records
• Calculate annual import values
• Compare against CBAM thresholds
• Document your findings

Step 5: Understand your reporting obligations

If your imports are in scope, you’ll need to begin collecting information on the greenhouse gas emissions associated with those products.

This means working closely with suppliers to obtain emissions data and maintaining robust records of imported goods. Reporting requirements are expected to begin from January 2027, with the first submissions due in 2028.

You may need to:

• Obtain emissions data from suppliers
• Maintain import documentation
• Prepare CBAM reports
• Monitor future regulatory changes

Step 6: Understand CBAM emissions data

There are two primary methods for reporting emissions under the UK CBAM:

Actual emissions data

Emissions are measured directly by the manufacturer and independently verified.

Benefits

• Greater accuracy
• Preferred reporting approach
• Potentially lower carbon liability

Default emissions data

Government-provided values that can be used when actual emissions data is unavailable.

Considerations

• Less reflective of supplier performance
• May result in higher liabilities

Businesses should engage suppliers early to understand what emissions information is available.

Common challenges businesses face

Many importers are currently asking:

• Which of our products are affected?
• How do we identify our obligations?
• How do we collect emissions data from overseas suppliers?
• What happens if supplier data isn’t available?
• How do we forecast future liabilities?

These are exactly the areas where early preparation can make the biggest difference.

Ready to take the next step?

This guide is designed to help you understand whether the UK CBAM applies to your business. If you’ve identified potential obligations, the next step is understanding what action you’ll need to take and how to prepare for future reporting requirements.

Explore our UK CBAM Compliance service to learn how Valpak can help identify obligations, engage suppliers, collect emissions data and support your ongoing compliance journey.

Learn more about UK CBAM compliance.