On 1 October 2023, the European Union’s Carbon Border Adjustment Mechanism (CBAM) entered into application in its transitional phase. During the transitional phase, importers of CBAM goods in the EU are required to report a set of data, including emissions embedded in their goods.
The European Commission have outlined that the EU CBAM will initially apply to imports of certain goods and selected precursors whose production is carbon intensive and at most significant risk of carbon leakage. The Commission have identified the following sectors as initially within scope during the transitional phase of the EU CBAM:
- iron and steel
- aluminium
- cement
- fertilisers
- electricity
- hydrogen
If you are a UK business exporting products or precursors to the EU in these sectors, you should review guidance provided by the EU to understand whether businesses you export to are in scope of the EU CBAM.
To help businesses in making their declarations, The European Commission has issued a new questions and answers paper looking at the reporting requirements in connection with the Carbon Border Adjustment Mechanism being faced by UK exporters into the EU.
Visit the GOV.UK website for more information