United Kingdom

In its joint response [1] to an earlier consultation, the UK Department for Energy Security and Net Zero and HM Treasury has confirmed that a UK CBAM will be implemented by 2027. The CBAM will impose a levy on those importing the most greenhouse gas (GHG) emissions-intensive products into the UK, which will reflect the gap between the carbon price that would have been imposed if the good had been produced in the UK and the carbon price already applied in the country of origin, if any. In doing so, the UK government is seeking to avoid “carbon leakage”: the phenomenon of UK based entities importing emissions-intensive products from outside the UK to avoid the charges placed on emissions-intensive products produced in the UK through the UK Emission Trading System (ETS). With the EU CBAM already up and running in its transitional phase from October this year (2023), and in the absence of any internationally agreed measures, similar and respons...