The "Interim Regulations on the Administration of Carbon Emission Trading" was promulgated and came into force on May 1

According to the Chinese government website on February 4, the "Interim Regulations on the Administration of Carbon Emission Trading" (hereinafter referred to as the "Regulations") has been adopted at the 23rd executive meeting of the State Council on January 5, 2024, and is hereby promulgated and will come into force on May 1, 2024.

There are 33 articles in the Regulations. The Regulations point out that the competent department of ecology and environment of the State Council, in conjunction with the relevant departments of the State Council, shall formulate the total amount and allocation plan of annual carbon emission allowances in accordance with the national greenhouse gas emission control targets, comprehensively consider factors such as economic and social development, industrial structure adjustment, industry development stage, historical emissions, and market regulation needs, and organize their implementation. Carbon emission allowances shall be allocated free of charge, and a combination of free and paid allocation methods shall be gradually implemented according to the relevant national requirements。 After the implementation of the Regulations, no new local carbon emission trading markets will be established, and key emitting enterprises will no longer participate in the carbon emission trading of local carbon emission trading markets of the same greenhouse gas types and industries.

According to the Regulations, the national carbon emission allowance registration agency is responsible for the registration of carbon emission trading products and the provision of trading and settlement services in accordance with relevant national regulations. In accordance with the relevant provisions of the state, the national carbon emission trading institution is responsible for organizing and carrying out centralized and unified trading of carbon emission rights。 Fees for registration and transactions shall be reasonable, and the charging items, charging standards, and management measures shall be disclosed to the public. The competent department of ecology and environment under the State Council, together with the market supervision and administration department of the State Council, the People's Bank of China and the banking regulatory authority under the State Council, shall supervise and administer the national carbon emission allowance registration institutions and the national carbon emission trading institutions, and strengthen information sharing and law enforcement coordination.

The Regulations specify that the types of greenhouse gases and the scope of industries covered by carbon emission trading shall be proposed by the competent department of ecology and environment of the State Council in conjunction with the development and reform departments of the State Council in accordance with the national greenhouse gas emission control targets, and shall be implemented after approval by the State Council. Carbon emission trading products include carbon emission allowances and other spot trading products approved by the State Council.

The Regulations also make it clear that key greenhouse gas emitting entities (hereinafter referred to as key emitting entities) that are included in the national carbon emission trading market and other entities that comply with relevant national regulations can participate in carbon emission trading. The competent department of ecology and environment, other departments responsible for the supervision and management of carbon emission trading and related activities (hereinafter referred to as other departments responsible for supervision and management), the national carbon emission allowance registration agency, the national carbon emission trading institution and the staff of the technical service institutions specified in these Regulations shall not participate in carbon emission trading。Carbon emission trading may take the form of agreement transfer, one-way bidding or other spot trading methods that comply with relevant national regulations。

In addition, the Regulations identify the illegal acts of key emitting entities, technical service institutions and other participating entities. The Regulations state thatThe competent department for ecology and the environment under the State Council, in conjunction with the relevant departments of the State Council, is to establish a credit record system for key emitting entities and other trading entities and technical service establishments, and include information such as on key emitting entities and other trading entities and technical service establishments receiving administrative punishments for violating the provisions of these Regulations in the relevant national credit information system, and release it to the public in accordance with law.