Although both carbon border adjustment mechanisms serve the same purpose, lowering carbon leakage on imports, the UK CBAM will operate as an indirect tax requiring the importer (liable persons) to complete CBAM tax returns. In contrast, the EU CBAM operates as a policy tool. Both, however, rely on the same school of thought to ensure importers pay the same costs as businesses that produce the goods domestically.

On the 10^th of February, the draft secondary legislation was published for a 6-week technical consultation.

If you import goods into the UK from the following sectors, you may wish to review the draft legislation and provide your feedback to the CBAM Policy team before 24th March 2026, when the consultation period closes.



Sectoral Scope of UK CBAM

• Aluminium
• Cement
• Fertiliser
• Hydrogen
• Iron and steel

Full Annex of Commodity Codes in the UK CBAM

The draft legislation focuses on the administration of UK CBAM and its various aspects as a tax, including the registration process for CBAM, CBAM tax returns, reimbursement arrangements, and record-keeping.

The open consultation link is provided below

Draft Regulations | CBAM