Viet Nam, Indonesia launch new regulations for forest carbon projects

Viet Nam’s rules say that revenue from forest-based carbon credits will be prioritised for forest protection and development, as well as community livelihoods. Indonesia has introduced a nesting framework to avoid double counting.

Viet Nam has passed the country’s first set of rules governing forest carbon sequestration and storage services, as it prepares to launch its carbon exchange later this year.
Published on 21 May, Decree No. 180/2026/ND-CP mandates “openness, transparency and accountability” in the provision and use of forest carbon services, state-run publication Nhan Dan reported.

Such services must not affect the country’s international commitments related to greenhouse gas (GHG) emissions reductions, and balance interests of the state, forest owners and relevant stakeholders, it added. Viet Nam has committed to achieving net zero emissions by 2050, as part of its Nationally Determined Contribution under the Paris Agreement.

The decree will come into effect on 1 July 2026.

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

“The services may be carried out through contracts or via a carbon trading exchange,” it said. Payments can be made directly to service providers or through systems associated with the Viet Nam 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.

The latest decree has been long-awaited and marks “another important development in Viet Nam’s carbon pricing, following the roll-out of a similar policy document of Indonesia,” said Mai Duong, policy advisor at the International Institute for Sustainable Development (IISD) on LinkedIn.

The move came after Indonesia’s Ministry of Forestry had in early April announced a new regulation, Regulation No. 6/2026, introducing a detailed framework for the republic’s forest carbon sector.

“Replacing [the ministry’s] Regulation No. 7 of 2023, the new regulation clarifies a number of issues that have been the subject of market uncertainty,” said Indonesia-based carbon project proponent CarbonEthics in an update on the development.

In particular, the regulations introduce a first-of-its-kind “nesting” framework that must be applied by jurisdictional programmes to align project-level carbon accounting with national and provincial targets. This is aimed at addressing the issues of double counting or double claiming of carbon credits, in which the emissions reduced are claimed by multiple parties.

Indonesia’s regulation also outlines new binding timelines, a strictly administrative ministerial review of projects, as well as an explicit list of “business actors” that are allowed to participate in the carbon trade, said CarbonEthics in its report.

The developments in Indonesia and Viet Nam’s carbon market frameworks are aimed at improving their readiness to participate in global carbon markets. In Indonesia, the Minister of Forestry’s principal advisor Edo Mahendra said recently that the latest regulation serves as a foundation for accelerating the trade of forest-based carbon credits with clearer and simpler business processes, as the world demands more high-integrity carbon credits.

Meanwhile, Viet Nam’s latest rules come over a month after its government introduced its first legal framework governing cross-border carbon trading, which was made under Decree No.112/2026/ND-CP. 

Published on 1 April, the framework allows projects including offshore wind energy, carbon capture projects and green hydrogen production to sell up to 90 per cent of carbon credits generated, according to a report by Viet Nam Investment Review.

Although the government’s plans to launch Viet Nam’s domestic carbon exchange has been delayed by a year to the end of 2026, the country has already been approved to receive over US$70 million from forest carbon credits. This sum is based on a proposal submitted by the government and the Japan International Cooperation Agency (JICA) to the United Nations-backed Green Climate Fund.

Meanwhile, Indonesia’s forestry ministry Edo Mahendra said on 25 May that the country’s latest forest carbon rules aligns the country’s regulatory frameworks with growing global demand for high-quality carbon credits.

Source: Eco-Business