From 1 July 2026, the UK Emissions Trading Scheme (UK ETS) will cover domestic maritime transport on ships of 5,000 GT and above operating on domestic UK routes and in UK ports.

Shipowners and managers need to prepare now to ensure compliance as shipping companies will be legally required to monitor, report and surrender UK ETS allowances for greenhouse gas emissions (carbon dioxide (CO₂), Methane (CO₄) and Nitrous Oxide (N₂O)) from qualifying ships.
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Reporting and allowance deadlines

The scheme’s first reporting period covers six months (1 July-31 December 2026). From 2027 onwards, the reporting period covers a calendar year (1 January-31 December). A verified emissions report must be submitted by 31 March (of the year following the reporting period) to the relevant regulators using the Manage Your UK Emissions Trading Scheme (METS) system.

Emissions allowances must be surrendered by 30 April (of the year following the reporting period). To allow maritime operators time to ensure they can meet these reporting requirements, there will be a one-off double surrender deadline for the 2026 and 2027 schemes of 30 April 2028. However, the verified report deadline for 2026 remains 30 March 2027.
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Applicability of domestic UK ETS

The domestic UK ETS will apply to any companies operating a ship carrying cargo or passengers which:

Exemptions to domestic UK ETS

The following ship types are exempt: armed services ships, law enforcement vessels, government surveillance/marine protection vessels, navigation/safe passage support vessels, fishing and fish processing vessels, publicly funded research vessels, coastguard and search and rescue vessels, medical emergency response vessels, non mechanically propelled ships, primitive wooden ships and Scottish ferry services.

Offshore vessels are only exempt until 31 December 2026.

UK emissions allowances

Each year regulated companies must purchase and surrender UK allowances equivalent to:

​​​​​​Regulated entities and UK ETS regulator

The regulated entity responsible for compliance with the UK ETS is the registered owner by default, unless these ETS responsibilities have been delegated by written agreement to the ISM company, and the regulator accepts the evidence. Responsibility for administering the UK ETS depends on where the operator is based and will be one of:

Timeline for compliance

For a full timetable of compliance please see UK ETS for Domestic Maritime | LR – Deadlines. Regulated entities must start collecting data as per their EMP for voyages and port activities in scope of the scheme from 1 July 2026.

Enforcement and penalties

Civil penalties may be applied where a company does not comply with the requirements of the domestic UK ETS, including:

Publication of non-compliant operators

Regulators will publish names of operators who are subject to emissions penalties.

For further information

For further information including access to the regulatory texts please visit: ​​​​​​