CBAM: a simple guide for UK and Irish importers
What is CBAM?
The Carbon Border Adjustment Mechanism (CBAM) is a carbon-pricing system for certain imported goods. Its purpose is to reduce carbon leakage: the risk that production moves to countries with lower carbon costs, while local manufacturers that pay for emissions are placed at a competitive disadvantage.
In simple terms, CBAM puts a carbon cost on specified imported products based on the greenhouse-gas emissions created during their production. It is not a customs duty and it does not replace the standard customs declaration, commodity classification, origin, import VAT or duty processes. It sits alongside them as an additional compliance and financial obligation for qualifying imports.
CBAM affects businesses importing selected carbon-intensive materials, as well as manufacturers, wholesalers and distributors whose supply chains rely on those materials. Importers should identify potentially affected commodity codes early and obtain reliable emissions data from overseas suppliers.
Which goods are covered by CBAM?
The EU and UK schemes cover similar, but not identical, sectors. The goods in scope are defined by specific commodity codes, so never rely solely on a product description such as "steel component" or "aluminium product".
| Sector | EU CBAM | UK CBAM |
|---|---|---|
| Cement | Covered | Covered |
| Iron and steel | Covered | Covered |
| Aluminium | Covered | Covered |
| Fertilisers | Covered | Covered |
| Hydrogen | Covered | Covered |
| Electricity | Covered | Not in initial scope |
| Glass and ceramics | Not covered | Not included at launch in 2027 |
The EU rules include direct emissions from making the product and, for certain goods, indirect emissions associated with electricity used in production.
A customs broker can help identify whether a product's commodity code is in scope. However, the importer remains responsible for ensuring that the classification, import records and emissions information are correct.
How EU CBAM works in Ireland
Ireland is part of the EU CBAM system. The EU's transitional reporting phase ran from October 2023 to December 2025. From 1 January 2026, the definitive regime applies: importers bringing qualifying CBAM goods into free circulation in Ireland may face authorisation, reporting and certificate obligations.
The 50-tonne threshold: importers of more than 50 tonnes of CBAM goods in a calendar year must become an authorised CBAM declarant before importing qualifying goods. The 50-tonne exemption does not apply to electricity or hydrogen.
The Irish importer, or in some cases an indirect customs representative that accepts this role, must apply through the CBAM Registry's Authorisation Management Module. Authorised declarants need to calculate the embedded emissions in their imported goods, submit an annual CBAM declaration and surrender the corresponding number of CBAM certificates. The first annual declaration, covering 2026 imports, is due by 30 September 2027.
In Ireland, the Environmental Protection Agency (EPA) is the CBAM National Competent Authority, while Revenue Customs is the Customs Authority. Revenue is relevant to customs clearance and customs-system interaction; the EPA oversees the wider CBAM compliance framework.
For goods imported into Ireland from Great Britain, the EU's CBAM rules may apply because Great Britain is outside the EU customs territory. Review the commodity code, country of origin, customs procedure and annual import volumes before shipment.
How the UK CBAM will work
The UK's CBAM starts on 1 January 2027 and applies across the whole United Kingdom, including Northern Ireland. It is designed to place a comparable carbon price on certain imports that compete with goods produced under the UK Emissions Trading Scheme.
The £50,000 threshold: the UK uses a value-based registration threshold rather than the EU's 50-tonne rule. A business must register with HMRC when the value of its in-scope imports exceeds £50,000 over the previous 12 months, or when it expects its imports to exceed that amount in the next 30 days.
Once registered, the importer needs to determine the embedded emissions in its covered goods, calculate the CBAM liability and submit UK CBAM returns. The UK system allows relief where a qualifying carbon price has already been paid in the country of origin, provided the importer can meet the evidence and verification requirements.
A business importing aluminium from Turkey into Great Britain, for example, may need to collect production-emissions data from the manufacturer, retain evidence of any foreign carbon price paid, register with HMRC once it reaches the threshold, and account for CBAM alongside its normal import declaration.
How to prepare for CBAM
- Map all imports against the relevant CBAM commodity codes.
- Track volumes into Ireland and the EU, and values into the UK, separately.
- Identify the importer of record and any indirect customs representative.
- Ask overseas suppliers for product-level emissions data and evidence of carbon prices paid.
- Review Incoterms, contracts and pricing to establish who carries the CBAM cost.
- Keep customs entries, invoices, supplier declarations, calculation records and emissions evidence together.
- Monitor official guidance, as technical rules and reporting systems continue to develop.
CBAM is both a customs and a supply-chain issue. Early preparation helps prevent incorrect declarations, unexpected cost exposure, shipment delays and avoidable commercial disputes. For importers trading between Great Britain, Ireland and the wider EU, the EU and UK schemes have different start dates, thresholds, systems and obligations, so they must be managed separately.