Vietnam Decree 29/2026/ND-CP: Domestic Carbon Trading Exchange

Mechanism

Decree 29 is Vietnam's principal implementing instrument for the carbon-market provisions of the 2020 Law on Environmental Protection and Decree 06/2022/ND-CP. Two tradable assets are recognised on the exchange:

• GHG emission quotas allocated administratively by the Ministry

of Agriculture and Environment (MAE) to enterprises subject to the national emissions inventory (initially: cement, steel, thermal power, fertiliser plants and other large emitters).

• Eligible carbon credits generated under domestic offset

methodologies once registered in MAE's national registry.

All quotas and credits must be centrally registered (with ownership data) in the MAE national registry before they can be deposited or traded. HNX runs the trading platform; VSDC handles the registry-side custody and post-trade settlement; the Vietnam Exchange (VNX) is the parent exchange entity. The decree took legal effect on the date of issuance (19 January 2026), with the first trading session scheduled inside the 2026-2028 pilot window.

Downstream implications

• Compliance-cost channel for heavy industry. Emission-quota

shortfall means buying allowances; surplus emitters can monetise. Cement / steel / thermal-power / fertiliser sectors most exposed.

• CBAM linkage. A functioning domestic carbon price gives Vietnamese

exporters of CBAM-covered goods (steel, aluminium, cement, fertiliser, electricity, hydrogen) a deductible domestic carbon-cost line against EU and UK CBAM levies under the definitive phase.

• FDI signal. Brings Vietnam into the small group of EM economies

with regulated carbon-pricing infrastructure (China ETS, Korea ETS, Indonesia IDXCarbon) — a credibility input for net-zero-aligned capital allocation.

• Pilot-phase fee waiver lowers the cost of early liquidity but

caps revenue to HNX/VSDC until 2029.

Open questions

• Cap-tightening trajectory after the pilot — Decree 29 is the market

plumbing; allocation methodology and absolute caps sit in MAE ministerial circulars still being drafted.

• Linkage to international credit standards (Article 6, VCS, GS) and

whether foreign offtakers will be allowed to buy on the exchange.

• Sectoral expansion timeline beyond the initial heavy-emitter list.