EU CBAM vs UK CBAM — Comparing…

Product Scope — What EU CBAM Covers vs What UK CBAM Covers

The first point of comparison is the sector scope. EU CBAM and UK CBAM are similar but not identical. EU CBAM (Regulation 2023/956, Annex I) precisely lists the sectors and CN codes of goods covered by the mechanism. The UK CBAM consultation from 2024 listed the same sectors plus a few additional ones (ceramics, glass). Differences in scope mean that a Polish company may be subject to UK CBAM for products that fall outside EU CBAM — and vice versa.

EU CBAM — Sectors and CN Codes (Law in Force)

EU CBAM (Regulation 2023/956, Annex I) covers the following sectors:

Cement — selected CN codes: 2523, 2507, 2710 and other clinkers
Electricity — CN 2716 00 00
Fertilisers — CN 2808, 3102, 3105 and selected from 3101, 2814
Iron and steel — CN chapters 72 and selected from 73 (pipes, profiles, sheets)
Aluminium — CN chapters 76 and selected from 73
Hydrogen — CN 2804 10 00

The full list with precise CN codes is contained in Annex I to Regulation 2023/956, available on EUR-Lex: eur-lex.europa.eu — Regulation 2023/956. The EU CBAM scope is final law — it is not subject to further consultation.

Nitrogen fertilisers exported to the EU by Polish producers (e.g. to Germany, the Netherlands) are excluded from EU CBAM if the Polish installation is covered by the EU ETS — the principle is that EU installations covered by EU ETS are treated as domestic producers. Exports PL→UK are treated as exports to a third country and are subject to UK CBAM on the UK importer's side.

UK CBAM — Sectors Enacted (Finance Act 2026)

UK CBAM (Finance Act 2026) covers the following sectors:

Iron and steel
Aluminium
Fertilisers
Cement
Ceramics — additional sector relative to EU CBAM
Glass — additional sector relative to EU CBAM
Hydrogen

Exact HS codes for UK CBAM will be published by HMRC in implementing regulations. The UK government relies on UK Trade Tariff HS codes — which are similar to, but not identical with, EU CN codes (UK Trade Tariff is based on HS but has its own 10-digit structure). Source: Finance Act 2026; gov.uk/government/collections/carbon-border-adjustment-mechanism. Monitor HMRC for implementing regulations specifying exact codes.

Emissions Methodology — EU CBAM vs UK CBAM: Similarities and Differences

The methodology for calculating embedded emissions is the heart of the CBAM system — it determines how many certificates the importer must purchase and what data the exporter must provide. EU CBAM has a detailed methodology set out in Implementing Regulation (EU) 2023/1773 (transitional phase) and Delegated Regulations specifying the embedded emissions methodology. UK CBAM's consultation announced that it would model its methodology on EU CBAM — but with modifications to account for the UK ETS rather than the EU ETS.

Direct and Indirect Emissions — EU vs UK Comparison

EU CBAM: Regulation 2023/956 and Implementing Regulation 2023/1773 distinguish between direct embedded emissions (from fuel combustion and chemical processes at the installation) and indirect embedded emissions (from electricity consumed at the installation). For fertilisers and steel: EU CBAM covers both types of emissions, but the methodology for indirect emissions varies by sector. Steel: indirect emissions included for electricity-based production (electric arc furnaces). Fertilisers: indirect emissions included for ammonia.

UK CBAM (proposal): The 2024 consultation announces a similar approach — direct and indirect emissions — with conversion factors based on UK grid carbon intensity. Difference: EU ETS and UK ETS have different allowance prices, so even an identical tonne of emissions translates into a different CBAM certificate cost.

Practical significance for exporters: if you provide emissions data for EU CBAM (for an EU importer), you can adapt the same documentation for UK CBAM (for a UK importer) — but the indirect emissions methodology may require separate calculations due to different grid intensity factors for Poland vs the UK grid.

Default Values — Different Benchmarks for EU and UK

For exporters who do not provide their own measurement data, EU CBAM applies default values published by the European Commission in implementing acts. Default values are deliberately conservative — higher than the actual emissions of modern facilities — to incentivise own measurements.

UK CBAM proposes its own default values to be published by HMRC, based on UK statistics and industry data. These may differ from EU values — particularly for sectors where the UK has a specific production structure (e.g. steel from scrap vs. primary producer).

Consequence: a company exporting to both markets may face different effective CBAM costs for EU and UK importers for the same tonne of product — if HMRC's default values turn out to be higher or lower than those of the European Commission. Your own documented measurement data eliminates this asymmetry.

TODO: Verify and update after HMRC publishes UK CBAM default values.

Timetable and Obligations — Key Differences for Companies Exporting to Both Markets

For a Polish company exporting simultaneously to the EU and the UK, the difference in timetables between EU CBAM and UK CBAM means that in 2026 the company is already in the full EU CBAM regime (certificates from 1 January 2026), while simultaneously preparing for UK CBAM proposed for 2027. This is not a double burden — it is two separate compliance tracks that can be served from the same emissions monitoring system at the production level.

EU CBAM vs UK CBAM Comparison Table

<table><thead><tr><th>Criterion</th><th>EU CBAM</th><th>UK CBAM (Finance Act 2026)</th></tr></thead><tbody><tr><td>Legal status (2026-04-18)</td><td>Law in force — Regulation 2023/956</td><td>Enacted — Finance Act 2026</td></tr><tr><td>Certificate requirement start</td><td>1 Jan 2026</td><td>1 Jan 2027</td></tr><tr><td>Transitional phase (reporting only)</td><td>Oct 2023 – Dec 2025</td><td>To be confirmed in HMRC implementing regulations</td></tr><tr><td>Sectors</td><td>Steel, aluminium, fertilisers, cement, electricity, hydrogen</td><td>Same + ceramics and glass</td></tr><tr><td>Emissions pricing system</td><td>EU ETS</td><td>UK ETS</td></tr><tr><td>Regulatory body</td><td>European Commission / CBAM Registry</td><td>HMRC / Government Gateway</td></tr><tr><td>CBAM declarant</td><td>Authorised EU declarant (EU importer)</td><td>UK declarant (UK importer)</td></tr><tr><td>Default values</td><td>Published by European Commission in Implementing Acts</td><td>To be published by HMRC in implementing regulations (2026)</td></tr></tbody></table>

NOTE: The UK CBAM column reflects the Finance Act 2026. HMRC implementing regulations will confirm technical details. Update this table when implementing regulations are published.

How to Manage Compliance for Both Markets Simultaneously

A company exporting steel or fertilisers to both the EU and the UK can optimise compliance effort through a shared emissions monitoring system at the production installation level. The key is: one measurement system (fuel consumption, emission factors) → two emissions reports in the required format (EU CBAM format for the EU importer, UK CBAM format for the UK importer).

Differences to account for:
• Goods codes: EU uses CN (Combined Nomenclature), UK uses HS UK Trade Tariff — check the mapping for each product
• Certificate price: EU ETS and UK ETS have different allowance prices — importers on both markets will pay different amounts for the same tonne of CO₂
• Declaration deadlines: EU CBAM — annual declaration by 31 May of the following year; UK CBAM — deadline to be confirmed
• Documentation language: EU CBAM accepts documents in EU languages; UK CBAM will require English

A customs broker can coordinate the preparation of CBAM documentation for both markets and keep you informed of UK CBAM timetable changes as the legislation progresses.

The Risk of Double Compliance and How to Minimise It

Double compliance — the obligation to simultaneously satisfy EU CBAM and UK CBAM — is not a duplication of costs for the exporter, but does require preparing two sets of emissions documents for two different importers (EU and UK). The cost of emissions is borne by the importer — the exporter bears the cost of documentation and the monitoring system.

Risks to manage:
• Methodology inconsistency: if the EU and UK adopt different methods for calculating indirect emissions, the same installation will produce two different figures — both correct, but in different systems
• Data updates: European Commission and HMRC default values may be updated — your company's system must track both sets of updates
• UK legislative risk: UK CBAM may be delayed or amended — export contracts with UK importers should not now contain hard commitments on CBAM certificate prices

Recommendation: include a CBAM adjustment clause in export contracts — a price adjustment for changes in CBAM certificate costs on the importer's side, should the HMRC methodology or UK ETS price diverge significantly from expectations.

What the current rules say

EU CBAM has applied since 2023 and is hard law — Polish companies exporting to the EU must already provide EU importers with emissions data; certificates are required from 1 January 2026. UK CBAM was enacted through the Finance Act 2026 with a start date of 1 January 2027 and a similar sector scope, but its own methodology based on the UK ETS. A company exporting to both markets can optimise compliance through one emissions monitoring system at the installation level and two separate reports — but must account for differences in goods codes (CN vs UK HS), allowance prices and declaration deadlines. This article reflects the legal position as of 2026-04-18; HMRC implementing regulations for UK CBAM are evolving. Contact a customs broker before taking any action.

FAQ — frequently asked questions

Does a Polish company have to comply with both EU CBAM and UK CBAM simultaneously?

Yes, if it exports to both markets. EU CBAM applies to exports to EU countries (the EU importer satisfies EU CBAM). UK CBAM (Finance Act 2026, from 1 January 2027) covers exports to the UK — the UK importer satisfies UK CBAM. A Polish exporter provides emissions data to the importer on each market separately.

Can emissions data prepared for EU CBAM be used for UK CBAM?

Data from the same measurement system can form the basis for both systems, but requires adaptation: different goods codes (CN vs UK HS), potentially different indirect emissions methodologies (EU ETS grid vs UK ETS grid), different reporting formats. One emissions monitoring system at the installation level is a good starting point — but the final documentation for the UK importer will be separate.

When does EU CBAM and when does UK CBAM require the purchase of certificates?

EU CBAM: obligation to purchase and surrender certificates from 1 January 2026. UK CBAM: certificate requirement from 1 January 2027 (Finance Act 2026). EU CBAM had a transitional phase (reporting only, no certificates) from Oct 2023 to Dec 2025 — whether UK CBAM will have an equivalent transitional phase will be confirmed in HMRC implementing regulations.

What is the difference between the EU CBAM certificate price and the UK CBAM certificate price?

The EU CBAM certificate price reflects the price of allowances in the EU ETS. The UK CBAM certificate price will reflect the price of UK ETS allowances. EU ETS and UK ETS have different prices — as a result the same tonne of CO₂ emissions may cost an EU importer a different amount than a UK importer. Both prices change over time.

Will UK CBAM cover ceramics and glass, which EU CBAM does not cover?

Yes — the Finance Act 2026 (UK CBAM) includes ceramics and glass as additional sectors relative to EU CBAM. Exact HS codes will be confirmed in HMRC implementing regulations. Ceramics and glass producers exporting to the UK should monitor gov.uk/government/collections/carbon-border-adjustment-mechanism for implementation details.

Official sources

Regulation (EU) 2023/956 — EU CBAM — EUR-Lex
EU CBAM — EC TAXUD — EC TAXUD
UK CBAM — GOV.UK guidance — GOV.UK
UK CBAM Consultation — GOV.UK — GOV.UK

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EU CBAM vs UK CBAM — Comparing Obligations for Polish Exporters