Vietnam and Indonesia have introduced new regulatory frameworks for forest carbon projects aimed at strengthening carbon credit governance and reducing market uncertainty (03/06).

Vietnam Introduces New Rules for Forest Carbon Services

Vietnam has issued its first set of regulations governing forest carbon sequestration and storage services as it prepares to launch a carbon exchange later this year.

The rules are set under Decree No. 180/2026/ND-CP, published on 21 May, and require “openness, transparency and accountability” in the provision and use of forest carbon services, according to state-run publication Nhan Dan.

The decree states that such services must not affect Vietnam’s international commitments on greenhouse gas (GHG) emissions reductions and must balance the interests of the state, forest owners, and other stakeholders. Vietnam has committed to net zero emissions by 2050 under its Nationally Determined Contribution to the Paris Agreement.

The decree will take effect on 1 July 2026.

Revenue Use and Forest Carbon Trading Mechanisms in Vietnam

Revenue generated from the trade of forest carbon credits will be prioritised for forest protection and development, support for community livelihoods, and further development of forest carbon projects and forestry databases, according to Nhan Dan.

Forest carbon services may be conducted through contracts or via a carbon trading exchange.

Payments can be made directly to service providers or through systems linked to the Vietnam Forest Protection and Development Fund, which also collects payments from businesses and organisations for forest ecosystem services.

“Payment levels are calculated in Vietnamese dong per tonne of carbon dioxide and its equivalent or per forest carbon credit,” it added.

Indonesia Introduces Nesting Framework for Carbon Accounting

Indonesia’s Ministry of Forestry has introduced Regulation No. 6/2026, replacing Regulation No. 7 of 2023, to provide a clearer framework for the country’s forest carbon sector.

A key feature of the regulation is a “nesting” framework that aligns jurisdictional programmes with project-level carbon accounting to national and provincial targets.

This approach is designed to prevent double counting or double claiming of carbon credits, where emissions reductions are claimed by multiple parties.

The regulation also introduces binding timelines, a strictly administrative ministerial review process, and a defined list of “business actors” allowed to participate in carbon trading, according to CarbonEthics.

Strengthening Regional Carbon Market Readiness

The regulatory developments in both countries are intended to improve readiness for participation in global carbon markets and enhance the integrity of forest-based carbon credits.

Vietnam’s framework follows earlier reforms, including Decree No. 112/2026/ND-CP, which allows certain projects such as offshore wind, carbon capture, and green hydrogen production to sell up to 90 per cent of generated carbon credits.

Although Vietnam’s carbon exchange launch has been delayed to the end of 2026, the country has been approved to receive over US$70 million from forest carbon credits through a proposal involving the Japan International Cooperation Agency (JICA) and the Green Climate Fund.

Indonesia’s forestry ministry said the updated regulation aligns its framework with growing global demand for high-quality carbon credits, according to principal advisor Edo Mahendra.

PHOTO: FREEPIK

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