In less than five months, the EU’s Carbon Border Adjustment Mechanism (CBAM) will come into force. The UK version will be launched one year later on 1st January 2027.
And while these dates may seem far off, LS Customs is urging companies to act now to ensure they have the right processes and systems in place to understand their liabilities and exposure.
Gordon Matson, Managing Director of LS Customs:
“CBAM is not a simple mechanism by any means and the treasury will expect robust records and reporting from all companies importing farming, construction, engineering, and certain oil and gas materials.
“We currently have a grace period to get to grips with the legislation, understand how it will impact our business, learn from how it’s being implemented in the EU, and prepare for its launch in the UK. Companies can also review their practices now and identify lower carbon and local alternatives to negate some liability.
“We are currently awaiting a launch date for the UKCS changes meaning we can expect two pretty seismic shifts in the customs landscape within a tight timeframe. These are complex matters with significant consequences including fines and project delays should companies get them wrong, so it is vital to be as well prepared as possible.”
What is CBAM?
HMRC cites: ‘The UK CBAM will place a carbon price on some of the most emissions intensive industrial goods imported to the UK from the aluminium, cement, fertiliser, hydrogen and iron & steel sectors that are at risk of carbon leakage.’
‘This will ensure highly traded, carbon intensive products from overseas face a comparable carbon price to that which would have been payable had they been produced in the UK, so that UK decarbonisation efforts lead to a true reduction in global emissions rather than simply displacing carbon emissions overseas.’
What can you do?
- Register with HMRC if you import more than £50,000 worth of goods.
- Find out what items are on the CBAM list by visiting HMRC.
- Capture carbon data on goods being moved.
- Assess your exposure – review your current imports and understand what is impacted and the likely cost.
How can LS Customs support?
- As a carbon and customs consultancy, LS Customs has expertise in navigating this space and can support with review, assessment, and recommendations for a lower carbon supply chain, as well as internal carbon accounting.
- Provide information and training sessions for staff.
- Review of customs data, analysing commodities for what is likely to be impacted.
- Ongoing customs support.
Contact queries@lscustoms.com for more information
