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China sets legal framework for carbon trading, intensifying data quality control and penalties

Source: Mysteel May 06, 2025 11:47

China will implement the "Interim Legislation on the Carbon Emission Trading Management" (hereinafter referred to as the " Interim Legislation") starting on May 1, 2024. This represents the State Council's first issuance of administrative regulations to define legal framework for carbon emission trading market operations. These regulations are being introduced nearly three years after the initiation of the national emission trading scheme (ETS). China's carbon trading market has now developed a multi-tiered legal structure encompassing administrative regulations, departmental rules, and operational guidelines for both trading and registration entities. This legal hierarchy ensures a clearer set of guiding principles for market participants to follow.

SUMMARY To regulate the national carbon emission trading and related activities, the Ministry of Ecology and Environment (MEE) introduced the "Management Measures for Carbon Emission Trading (Trial)" in 2020 (hereinafter referred to as the "Management Measures"). These measures, as departmental rules, rank below the "Interim Legislation" in terms of legal