The Door & Hardware Federation (DHF) is encouraging manufacturers and importers across the construction and hardware supply chain to start preparing for the introduction of the UK’s Carbon Border Adjustment Mechanism (CBAM), which comes into force on 1st January 2027.
CBAM is a developing carbon reporting and taxation framework designed to address the carbon emissions associated with imported goods. The scheme will work alongside the existing UK Emissions Trading Scheme (UK ETS) and apply a carbon price to certain imported products, ensuring imported goods face a similar carbon cost to those manufactured domestically. The UK Government has confirmed that CBAM will initially apply to specific sectors, currently aluminium, cement, fertilisers, hydrogen, and iron and steel, with goods identified at commodity code level (the list of commodity codes within the scope can be found in Annex B: https://bit.ly/4tF7dGJ). Businesses importing £50,000 or more of CBAM goods within a 12-month period will be required to register.
“The introduction of CBAM represents a significant shift in how carbon accountability will operate across international trade and manufacturing,” explains Michael Skelding, General Manager and Secretary of DHF. “While the initial scope is focused on upstream materials and high carbon sectors, the effects will inevitably filter down through construction supply chains, including the door, hardware and security sectors. Manufacturers and importers throughout the supply chain will increasingly be asked to demonstrate transparency around embodied carbon and sourcing practices. Preparing now will place businesses in a much stronger position as regulation develops.”
CBAM has been designed to reduce so called “carbon leakage”, where manufacturing moves to countries with less stringent climate regulations. The mechanism also aims to encourage lower carbon manufacturing globally, improve emissions transparency, and create a fairer competitive environment between domestic and imported goods. The European Union has already implemented its own CBAM framework, with the UK scheme following approximately twelve months later.
“The direction of travel is clear,” concludes Michael. “Carbon reporting, verification and supply chain transparency are becoming central to doing business within construction and manufacturing. DHF will continue supporting members by monitoring developments closely and providing guidance as further detail emerges.”
Under the UK framework, importers will be able to reduce the UK tax payable where imported goods have already been subject to a recognised carbon pricing scheme, such as the EU CBAM, provided the appropriate verification documentation is available. The Door & Hardware Federation is continuing to engage with industry stakeholders and government developments to help members understand the implications of CBAM and prepare for future compliance requirements.
