The Project on Establishing and Developing a Carbon Market in Vietnam aims to build a legal framework, pilot a carbon trading floor in the period from 2025 to 2028 and officially operate it in 2029…
On January 24, 2025, Deputy Prime Minister Tran Hong Ha signed Decision No. 232/QD-TTg approving the Project on Establishing and Developing a Carbon Market in Vietnam.
The general objective of the Project is to develop a carbon market in Vietnam, supporting the target of reducing greenhouse gas emissions as committed in the Nationally Determined Contribution (NDC), at low cost, while creating new financial sources for emission reduction activities.
Along with that, promoting green transformation, developing low-emission technology, improving business competitiveness, developing a low-carbon economy and responding to climate change, towards net emissions of “0” by 2050.
Specifically, by June 2025, the legal framework for trading greenhouse gas emission quotas, carbon credits and the carbon credit exchange and offset mechanism will be completed, creating a basis for piloting a carbon trading floor. At the same time, build infrastructure to operate the carbon market, improve the management capacity of state agencies and the awareness and market participation capacity of enterprises, organizations and individuals.
HANOI STOCK EXCHANGE IS A SERVICE PROVIDER
According to the approved Project, there are two types of goods on the carbon market, specifically:
First, greenhouse gas emission quotas are allocated to establishments in the List of sectors and establishments emitting greenhouse gases that must conduct greenhouse gas inventories issued by the Prime Minister in a free and auction manner.
Second, carbon credits confirmed for trading on the market include: Carbon credits obtained from programs and projects under the domestic carbon credit exchange and offset mechanism in accordance with the provisions of law Carbon credits obtained from programs and projects under the credit exchange and offset mechanism.
Along with that are international carbon credits such as carbon credits obtained from the Clean Development Mechanism (CDM), carbon credits obtained from the Joint Crediting Mechanism (JCM), carbon credits obtained under the Mechanism under Article 6 of the Paris Agreement.
The project proposes 5 groups of tasks and solutions for implementation, including: Group of tasks and solutions on goods in the carbon market; Group of tasks and solutions on subjects participating in the carbon market; Group of tasks and solutions on the national registration system and carbon trading floor; Group of tasks and solutions on the organization and operation of the carbon market; Group of tasks and solutions on raising awareness and enhancing capacity.
Regarding the trading method, the trading of greenhouse gas emission quotas and carbon credits is carried out on the domestic carbon trading floor.
In which, the Hanoi Stock Exchange builds and provides domestic carbon trading floor services according to the professional requirements on market organization and management and the conditions and technical standards chaired by the Ministry of Natural Resources and Environment, in coordination with the Ministry of Finance and relevant ministries, branches and agencies.
According to Decision No. 232/QD-TTg, transactions on the carbon market are organized centrally on the carbon exchange, with greenhouse gas emission quotas and carbon credits confirmed by the Ministry of Natural Resources and Environment. The codes issued for transactions are unique and non-duplicate.
At the same time, participating entities must have transaction depository accounts, and registration and code issuance are carried out centrally to ensure data synchronization, meeting management and monitoring requirements.
The approved project clearly states that the Vietnam Securities Depository and Clearing Corporation provides depository and payment services, based on technical standards developed by the Ministry of Natural Resources and Environment in coordination with relevant agencies. Transaction payments are automatically performed by the system, ensuring the principle of simultaneous delivery of goods and payment at the bank.
In addition, qualified commercial banks will make payments for transactions. The Ministry of Natural Resources and Environment coordinates with ministries and branches to organize the operation of the carbon market, ensuring strict management, avoiding loss of resources and assets and affecting national security and social order.
ENTITIES PARTICIPATING IN TRADING ON THE CARBON EXCHANGE
Regarding the roadmap for implementing the carbon market, there are two phases. The pilot implementation phase is from 2025 to the end of 2028. During this phase, the carbon market will be piloted nationwide. The transfer of carbon credits and greenhouse gas emission reduction results to foreign and international partners is researched, specifically regulated in legal documents and considered and decided by competent authorities.
The entire greenhouse gas emission quota is researched and considered for free allocation to greenhouse gas emission facilities in a number of major emission sectors. Carbon credits are confirmed for trading on the carbon exchange.
Including carbon credits obtained from: Programs and projects under the domestic carbon credit exchange and offset mechanism; Clean Development Mechanism (CDM); Joint Credit Mechanism (JCM); Mechanism under Article 6 of the Paris Agreement. The proportion of carbon credits used to offset greenhouse gas emissions over the total greenhouse gas emission quota allocated to the facility is determined by the Government.
The project also stipulates that the subjects participating in transactions on the carbon trading floor are large greenhouse gas emission facilities in the List of sectors and greenhouse gas emission facilities that must conduct greenhouse gas inventories issued by the Prime Minister and are allocated greenhouse gas emission quotas; organizations and individuals that are eligible to participate in buying and selling carbon credits on the carbon trading floor.
The official nationwide operation phase begins in 2029. Accordingly, the sectors and facilities allocated greenhouse gas emission quotas will be studied and considered for expansion according to the roadmap. Greenhouse gas emission quotas will be studied and considered for free allocation and allocation through auction.
“The detailed ratio of free allocation and auction of greenhouse gas emission quotas will be proposed during the pilot implementation phase and after having full information and data on the allocated greenhouse gas emission quotas and transaction volume,” the project clearly states.
At the same time, the ratio of carbon credits used to offset emissions over the total greenhouse gas emission quota allocated to facilities shall be prescribed by the Government; consider expanding the subjects allowed to participate in carbon credit transactions on the carbon exchange (adjusting the conditions for organizations and individuals allowed to participate in transactions on the carbon exchange)…
