Vietnam is operating the pilot phase of its carbon market under Article 139 of the Law on Environmental Protection 72/2020/QH14, Decree 06/2022/ND-CP and the amending Decree 119/2025/ND-CP: the pilot exchange runs to the end of 2028, and from 2029 the market moves to official operation with allowance auctioning. For FDI enterprises in emission-intensive sectors, “pilot” does not mean standing outside — the first allocation already reaches 110 facilities, and the greenhouse-gas inventory duty runs years ahead of the market itself.
Who is already in the market: the 110-facility pilot allocation and the 2027 deadlines
The pilot allowance allocation for 2025–2026 covers 110 facilities in the three largest emitting sectors: 34 thermal power plants, 25 iron and steel facilities and 51 cement facilities — including a number of FDI and joint-venture plants. Total allowances allocated for the two years amount to roughly 511.5 million tonnes of CO2e (about 243.1 million tonnes for 2025 and 268.4 million tonnes for 2026), and at this stage allowances are allocated 100% free of charge based on each facility’s inventory data. Covered facilities must know the operating milestones by heart: trading of allowances and credits on the pilot exchange at the Hanoi Stock Exchange (HNX) until 24 December 2027; the period’s greenhouse-gas inventory report due before 1 December 2027; and surrender of allowances matching actual emissions before 31 December 2027, with carbon credits allowed to offset up to 30% of the surrender obligation. Trading fees are waived through the end of 2028 to encourage the pilot’s operation. A facility emitting beyond its allocation must buy additional allowances or credits on the exchange or face the compliance mechanics of the official phase — this is the first time emissions in Vietnam carry a tradable price, even if pilot prices are still formative.
What FDI must prepare: inventory is the entry gate, data is the asset
The most important preparation is not on the exchange but in the greenhouse-gas inventory: facilities on the inventory-obligated list in Decision 01/2022/QD-TTg must inventory and periodically report emissions under Decree 06/2022/ND-CP — even if the facility is not among the 110 allocated in this round, because expansion of the list and sector coverage is the stated roadmap (see FDI-LC-2038 on the ESG data layer). Three concrete work blocks: (1) build a measurement–reporting–verification (MRV) system at the plant: emission boundaries, emission factors, controlled activity-data processes — the same data EU customers will demand for CBAM on steel and aluminium (see FDI-LC-2039) and for the group’s Scope 3 reporting; (2) an allowance compliance plan: forecast emissions against the allocated allowances, the break-even between internal abatement and buying allowances/credits, and a carbon budget inside the financial plan from 2027 — when the first surrender falls due; (3) track the phase transition: from 2029 the market operates officially with auctioning — free allocation will shrink, and enterprises holding high-quality inventory data from the pilot phase will be far better positioned when allocation shifts to performance benchmarks. On sanctions: the pilot market has no standalone penalty framework for market conduct; violations of inventory and emissions-reporting duties are handled under the environmental administrative-penalty framework (Decree 45/2022/ND-CP), and the surrender duty is a compliance obligation to be met by 31 December 2027 — “pilot” should not be read as “optional”.
Frequently asked questions
What are the milestones of Vietnam’s pilot carbon market?
Under Decree 06/2022/ND-CP (as amended by Decree 119/2025/ND-CP): pilot allocation for 2025–2026 to 110 power, steel and cement facilities; trading on the pilot exchange at HNX; inventory reports before 1 December 2027 and allowance surrender before 31 December 2027; the pilot runs to end-2028; official operation and auctioning from 2029.
Which FDI enterprises must join the carbon market?
First, FDI facilities among the 110 pilot allocation recipients (thermal power, iron and steel, cement). The wider base duty: every facility on the GHG-inventory list in Decision 01/2022/QD-TTg must inventory and report emissions even before receiving allowances.
How are emission allowances allocated and surrendered?
In the pilot they are allocated 100% free based on each facility’s inventory (roughly 511.5 million tCO2e in total for 2025–2026). Facilities surrender allowances matching actual emissions before 31 December 2027, may offset up to 30% with carbon credits, and buy any shortfall on the pilot exchange.
What should an FDI enterprise prepare from 2026?
An on-time plant-level inventory/MRV system and emissions reporting; an emissions forecast against allowances with a carbon budget for the 31 December 2027 surrender; and readiness for the official phase and auctioning from 2029. Good inventory data also serves CBAM and group reporting.
This article has been quality-reviewed by the FLAW AI Legal Council
