On January 24, the Prime Minister issued Decision No. 232/QD-TTg approving the Project on Establishing and Developing the Carbon Market in Vietnam.
The overall objective of the Project is to develop a carbon market in Vietnam, contributing to the implementation of the greenhouse gas emission reduction target committed in the Nationally Determined Contribution (NDC) at low costs for businesses and society, creating new financial flows for greenhouse gas emission reduction activities, promoting green transformation, developing low-emission technologies, contributing to improving the competitiveness of Vietnamese enterprises domestically and in the world market, developing a low-carbon economy and proactively responding to climate change, towards achieving net emissions of "0" by 2050.
The project aims to: Gradually build and complete the legal framework for the exchange of greenhouse gas emission quotas, carbon credits and the mechanism for exchanging and offsetting carbon credits, ensuring the legal basis for the pilot implementation of carbon trading floors; building infrastructure to serve the organization and operation of the carbon market; improving the management capacity and organization of the carbon market operation of state management agencies, the capacity and awareness of enterprises, organizations and individuals to meet the readiness to participate in the carbon market.
According to the Project, goods on the carbon market include 2 types:
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-of-charge and auction manner.
Carbon credits are confirmed to be traded on the market, including: Carbon credits obtained from programs and projects under the domestic carbon credit exchange and offset mechanism as prescribed by law; carbon credits obtained from programs and projects under the international carbon credit exchange and offset mechanism: Carbon credits obtained from the Clean Development Mechanism (CDM); carbon credits obtained from the Joint Credit Mechanism (JCM); carbon credits obtained under the Mechanism under Article 6 of the Paris Agreement.
Trading of greenhouse gas emission quotas and carbon credits is carried out on domestic carbon exchanges.
Hanoi Stock Exchange builds and provides domestic carbon trading floor services according to professional requirements on market organization and management and technical conditions and standards presided over by the Ministry of Natural Resources and Environment, in coordination with the Ministry of Finance and relevant ministries, branches and agencies.
The organization of transactions on the carbon market is carried out in a centralized manner on the carbon exchange. Greenhouse gas emission quotas and carbon credits certified by the Ministry of Natural Resources and Environment to be traded on the exchange will be assigned a domestic code to serve the transaction, the code assigned is unique and non-duplicated.
When participating in transactions on the carbon market in Vietnam, the subject must have a depository account for greenhouse gas emission quota transactions or a depository account for carbon credit transactions. The registration and issuance of greenhouse gas emission quota and carbon credit codes are carried out centrally to ensure that data is unified, synchronized and meets management and monitoring requirements.
Vietnam Securities Depository and Clearing Corporation provides depository and transaction settlement services according to professional requirements on organization, market management and technical conditions and standards presided over by the Ministry of Natural Resources and Environment, in coordination with the Ministry of Finance and relevant ministries, branches and agencies.
The transaction settlement will be automatically carried out by the system based on the transaction results sent by the Hanoi Stock Exchange, ensuring the principle that the transfer of goods is carried out simultaneously with the payment at the payment bank. The payment for transactions on the carbon trading floor is carried out by a commercial bank qualified to provide payment services for greenhouse gas emission quota and carbon credit transactions.
The Ministry of Natural Resources and Environment shall preside over and coordinate with the Ministry of Finance, the Ministry of Agriculture and Rural Development, the Ministry of Construction, the Ministry of Industry and Trade, the Ministry of Transport and relevant ministries, branches and agencies to organize the operation of the domestic carbon market, ensuring that it does not develop freely and spontaneously, causing loss of State resources and assets, affecting national security and social order.
Roadmap for carbon market implementation
Pilot implementation phase from 2025 to the end of 2028: Pilot implementation of the carbon market 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 to be traded 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 ratio of carbon credits used to offset greenhouse gas emissions to the total greenhouse gas emission quota allocated to the facility is prescribed by the Government. The subjects participating in transactions on the carbon trading floor are: Large greenhouse gas emission facilities in the List of sectors, greenhouse gas emission facilities that must conduct greenhouse gas inventories issued by the Prime Minister 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.
Official operation phase from 2029
The carbon market is officially operated nationwide. The sectors and facilities allocated greenhouse gas emission quotas are studied and considered for expansion according to the roadmap. Greenhouse gas emission quotas are studied and considered for free allocation and auction allocation. 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 ratio of carbon credits used to offset emissions over the total greenhouse gas emission quota allocated to facilities is prescribed by the Government; consider expanding the subjects allowed to participate in carbon credit transactions on the carbon exchange (adjust the conditions for organizations and individuals allowed to participate in transactions on the carbon exchange)...
The project proposes 5 groups of tasks and solutions for implementation: 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 organizing and operating the carbon market; Group of tasks and solutions on raising awareness and enhancing capacity.
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