HM Revenue & Customs has taken another significant step towards the introduction of the UK Carbon Border Adjustment Mechanism (CBAM), with new secondary legislation confirming requirements for calculating, monitoring and verifying embodied emissions.
The Carbon Border Adjustment Mechanism (Emissions and Verification) Regulations 2026 were laid on 9 September 2026. They build on the technical system boundaries published in July and provide further detail on the compliance framework that will apply when UK CBAM starts on 1 January 2027.
From technical guidance to regulation
HMRC’s system boundaries guidance published in July identified the production processes, direct emissions and precursor goods relevant when calculating embodied emissions. This gave importers and overseas manufacturers a clearer basis for assessing which emissions data may be required within their supply chains.
The latest Regulations now establish important legal requirements around those calculations. They cover how embodied emissions are determined, the monitoring periods that can be used, requirements for emissions verification and the records businesses must retain.
Importers will be able to use government default emissions values or verified actual emissions data. Where actual emissions are used, businesses will need appropriate information from the overseas installation producing the goods and evidence that the figures have been verified in accordance with UK requirements.
Verification and record keeping
For goods imported during 2027, the most recent verified emissions data available from either 2027 or the preceding calendar year may be used where the emissions intensity is linked to the date of importation. Verified 2026 data could therefore play an important role during the first year of CBAM.
Verification reports must contain specified information relating to the installation, operator, verifier and monitoring period, together with the verifier’s opinion on whether the emissions data are sufficiently accurate.
Where verified actual emissions data are reported, relevant verification reports or qualifying good-specific verification summaries must generally be retained for six years.
What this means for UK businesses
The latest legislation increases the need for businesses to move from initial assessment into practical preparation. Manufacturers, engineering businesses, distributors and other importers using aluminium, iron, steel or other in-scope goods should establish what information they will need before CBAM takes effect.
Businesses should confirm the commodity codes of imported products, identify which goods fall within CBAM, monitor their position against the £50,000 registration threshold and establish whether overseas suppliers can provide appropriate emissions information.
Procurement, customs, finance and sustainability teams may all need to work together. Supplier contracts and internal data collection procedures may also require attention before 1 January 2027.
How TVCC can help
TVCC’s customs team can support businesses in reviewing commodity classifications, customs values, importer responsibilities, records and internal controls as part of CBAM preparation. Specialist emissions verification itself must meet the accreditation requirements established under the CBAM framework.
For support, contact the TVCC international trade team on 01753 870560 or email trade@tvchamber.co.uk.
Original sources:
https://www.gov.uk/government/publications/carbon-border-adjustment-mechanism-cbam-policy-summary/carbon-border-adjustment-mechanism-cbam-policy-summary
