Insight

In February the Confederation of British Metalforming (CBM) and the British & Irish Association of Fastener Distributors (BIAFD) presented a joint webinar updating their members on developments with the EU Carbon Border Adjustment Mechanism (CBAM) regulation. An attendance of 138 members from the two UK industry bodies clearly reflected the continued deep level of concern and uncertainty over compliance with EU CBAM.

Keynote speaker for the webinar was Jamie McLeod, senior manager – customs at Crowe UK LLP, who will also provide a further update at BIAFD’s Spring Meeting on 3^rd April.

Jamie recapped the basis for the EU CBAM, outlined where we are now, and reviewed the timeline for implementation. He noted that reports submitted by EU importers during 2025 must be based on actual emissions data from 2024 monitoring, acknowledging that obtaining reliable and complete emissions data remains a significant challenge for many EU importers and their UK suppliers.  

Referring to reports about the European People’s Party arguing that CBAM implementation should be put on hold for two years, Jamie assessed that a delay is highly unlikely. However, he noted the EU had acknowledged the need for some simplifications, aimed at smaller importers. Subsequently, there have been signals from the Commission that consideration is being given to an amendment that might exclude most EU SME importers from CBAM compliance. However, so far, there is only limited information about a potential amendment to EU legislation, which will require approval from the EU Council and the European Parliament, or the timescale involved in bring any changes into effect.  

Referring to recent reports that the UK was actively exploring re-linking the UK Emissions Trading Scheme to that of the EU, Jamie affirmed that alignment could mitigate trade impacts for CBAM goods between the UK and EU. However, he believed reaching an agreement was likely to be highly challenging due to the divergence in existing schemes, financial contributions and the need to dynamically align with the EU. It was also likely the EU would demand significant concessions in other areas. 

The situation relating to Northern Ireland also remained potentially contentious as the UK intends it should be included in the proposed UK CBAM due to be implemented in 2027, but the EU reserves the right to insist on Northern Ireland being covered by EU CBAM. For now, goods moving from Great Britain to Northern Ireland are not subject to EU CBAM. 

Jamie moved onto share his research on the potential costs of purchasing EU CBAM certificates from 2026, when the mechanism moves to its definitive stage. Critical to arriving at a clear initial cost is the CBAM benchmark, which is not expected to be published until the second half of 2025 – a source of frustration as it prevents both EU importers and their suppliers from assessing the cost of purchasing CBAM certificates next year. Other crucial factors will be the CBAM factor, driven by the phase-out of free allowances, and the EU carbon price, which is expected to continue to increase. When the benchmarks are published, explained Jamie, and as availability and quality of emissions data improves, forecasting the direct financial impact of CBAM will become easier. In the meantime, Crowe UK has developed a spreadsheet modelling tool that, using assumed values for the factors still to be announced, plus the emissions data for their products, allows UK companies to begin to assess the potential cost to EU customers of importing their products. This could help in identifying commercial risks and the potential to mitigate them by reducing embedded emissions. 

In January the EU introduced a ‘third country operators’ portal, designed to simplify the reporting process for non-EU companies by allowing them to upload their emissions data directly to the CBAM registry. Non-EU companies must follow a specific procedure for creating an account and submitting an access request and will need to obtain importing customers’ EORI numbers to share the submitted data through the portal. However, the initial impact of this development may be limited as much depends on the speed and extent of adoption by non-EU operators and how easy it is to use the portal effectively. 

Jamie rounded off by looking forward to other critical developments during a huge year for the development of EU CBAM, affected importers and their supply chains. He also reminded attendees that the UK would introduce its CBAM in 2027. 

The second webinar speaker was Victor Perez Prieto, who provided an update on the latest developments on the CarbonGlance CBAM calculation and reporting platform. These include the recently launched ability for declarant importers to connect with their own suppliers to rapidly integrate emissions data. Victor also explored the extensive resources now available on the CarbonGlance online Help Centre. These now include templates for different CBAM sectors, most relevantly to webinar attendees the one for iron and steel. Valuably, this also includes examples for different stages in the manufacturing supply chain. 

Looking forward to verification requirements, CarbonGlance has also ensured transparency by publishing the equations used in the background of the platform to calculate CBAM data. The CarbonGlance Help Centre now also includes a CBAM Q&A Section, reflecting both questions from platform users and those expressed to the European Commission and addressed in its own FAQ section, available from the EU CBAM website. 

Victor went onto explore how CarbonGlance can be used by non-EU operators to provide data to the new EU O3CI non-EU operators platform. He emphasised that use of the portal is optional so EU importers and their supply chain participants may choose to continue to exchange emissions data either via the CarbonGlance platform, if both are users, or via spreadsheet templates. Victor spent a few minutes demonstrating how a non-EU operator applied and registered to use the new EU portal. 

Concluding, Victor announced the launch of a CarbonGlance Free Plan – a trial option permitting assessment of the tool, without prior commitment to payment. He emphasised that payment was only required once the operator had proven the tool worked for them – if not they were free to assess and adopt other tools that are available. 

The session concluded with responses from Jamie and Victor to questions submitted by attendees on the chat system. 

Both the Confederation of British Metalforming and the British & Irish Association of Fastener Distributors are committed to providing their members with ongoing information and updates on EU CBAM and, as information becomes available this year, on the UK CBAM, scheduled to come into force in January 2027.

Both also provide a wide range of other support and representation for their members. Information on membership of the two bodies is available on their respective websites.