The Aluminium Federation (ALFED) has called for clarity in HMRC’s consultation on the draft regulations for the UK Carbon Border Adjustment Mechanism (CBAM).
The response highlights the urgent need for clarity, alignment and practical implementation to protect UK manufacturing competitiveness.
Submitted on behalf of the full aluminium value chain, the response outlines key concerns around policy design, implementation timelines and administrative complexity, while reinforcing the importance of CBAM as a mechanism to prevent carbon leakage and support fair competition.
With implementation of CBAM scheduled for January 2027, businesses require urgent clarity on Monitoring, Reporting and Verification (MRV) frameworks, emissions methodologies and verification requirements.
As highlighted in the submission, many of these core elements are not expected to be finalised until late 2026, leaving insufficient time for industry to prepare.
Without early publication of these frameworks, UK manufacturers risk facing significant disruption, increased compliance costs and commercial uncertainty.
ALFED’s response raises concerns that, if not carefully designed, CBAM could inadvertently disadvantage UK manufacturers.
The Federation is therefore calling for a CBAM framework that supports UK industry, rather than placing additional burdens on already cost-challenged manufacturers.
Given the close integration of UK and EU aluminium supply chains, ALFED has also stressed the importance of maintaining alignment with the EU CBAM framework.
Divergence in reporting requirements, emissions calculations or verification standards would create unnecessary complexity, increase administrative costs and risk distorting trade flows for companies operating across both markets.
The aluminium sector operates within highly complex, global supply chains, often involving multiple stages of processing across different jurisdictions.
ALFED’s response highlights the need for clear guidance on the treatment of complex goods and precursor materials, practical approaches to emissions data collection and proportionate verification requirements.
Nadine Bloxsome, CEO of ALFED, said: “CBAM has the potential to be a critical policy tool in supporting decarbonisation and protecting UK industry from carbon leakage. However, its success will depend entirely on how it is implemented.
“At present, there remains significant uncertainty across key areas of the framework. Industry needs clear, consistent and timely guidance to prepare effectively and avoid unintended consequences.
“We are calling on Government to work closely with industry to ensure CBAM supports UK competitiveness, aligns with international frameworks and provides the clarity businesses urgently need.”
ALFED has also called on Government to ensure that CBAM revenues are reinvested into UK industry to support decarbonisation, recycling infrastructure and long-term competitiveness.
ALFED will continue to engage closely with HMRC, HM Treasury and industry stakeholders as the policy develops, ensuring the voice of the UK aluminium sector is fully represented in shaping a practical and effective CBAM framework.
