On 19 January 2026, the Government issued Decree No. 29/2026/ND-CP (“Decree 29“), officially establishing the regulatory architecture for the domestic carbon trading exchange.
Decree 29 provides the long-awaited implementation guidelines for the trading of Greenhouse Gas (GHG) emission quotas and carbon credits. It operationalizes the market by assigning the Hanoi Stock Exchange (HNX) to run the trading platform and the Vietnam Securities Depository and Clearing Corporation (VSDC) to handle registration, custody, and settlement. Key highlights:
- Market Infrastructure: The carbon market will operate similarly to the securities market but with specific constraints to ensure environmental integrity: All emission quotas and carbon credits must be centrally registered on the National Registration System before trading. The Ministry of Agriculture and Environment manages registration, domestic code issuance, and transfers trading data to the Vietnam Securities Depository and Clearing Corporation (VSDC) and the Hanoi Stock Exchange (HNX). While HNX manages the spot trading system, VSDC manages the central registry, custody, and clearing of credits.
- Trading Mechanics: Sellers must have 100% of the quotas/credits in their account before placing an order. Buyers must have 100% of the funds available before bidding. Transactions are settled on a T+0 basis (same day) using a Gross Settlement method. There is no central counterparty (CCP) mechanism, minimizing systemic risk.
- Violations: Carbon trading members may be suspended (up to 90 days) or terminated for regulatory breaches or failure to meet technical standards. Suspended or terminated members cannot enter new contracts and must fulfill settlement obligations to clients.
- Obligations: Members must submit quarterly and annual reports to VSDC and the Vietnam Stock Exchange. The pilot domestic carbon exchange operates fee-free through December 31, 2028, with official fee collection starting January 1, 2029, under Decree No. 06/2022/ND-CP as amended by Decree No. 119/2025/ND-CP.
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Please do not hesitate to contact Dr. Oliver Massmann under [email protected] if you have any questions or want to know more details on the above. Dr. Oliver Massmann is the General Director of Duane Morris Vietnam LLC.
