What is Vietnam doing to prevent double counting?

The concept of “double counting”

“Double counting” occurs when a single greenhouse gas (GHG) emission reduction or removal is claimed by two or more entities to meet their climate targets. A common example is when the host country counts an emission reduction toward its Nationally Determined Contribution (NDC), while an international buyer—another country or a corporation—also uses the same reduction to offset its own emissions or achieve net-zero goals. This practice undermines the environmental integrity of the carbon market and risks compromising the global objectives of the Paris Agreement. To prevent this, Vietnam has established a clear legal and institutional framework, primarily through Decree No. 06/2022/ND-CP and its amendments in Decree No. 119/2025/ND-CP. These regulations set out measures to ensure that each emission reduction is uniquely accounted for, tracked, and reported, maintaining transparency and credibility in both domestic and international carbon markets.

Establishing a National Carbon Credit Database System (MRV Registry)

The Ministry of Agriculture and Environment is developing the National Registration and Monitoring System for emissions, emission reductions, and carbon credits, also known as the MRV Registry. This system manages the entire lifecycle of a carbon credit, from generation through MRV, verification, and transaction, to its cancellation or use for the national NDC. Acting as the central control mechanism, it prevents a single credit from being recorded or claimed multiple times, thereby safeguarding environmental integrity.

Clearly stipulating responsibility for claiming credit ownership

Each emission reduction project must identify the entity that owns the credits after verification. Ownership responsibility is formally recorded in the project documentation and MRV report. In cross-border transactions, projects must commit either not to use these credits toward the Nationally Determined Contribution (NDC) or, if they are used, to apply a corresponding adjustment.

Connecting with international mechanisms under Article 6.2 of the Paris Agreement

Vietnam is also implementing an international coordination mechanism under Article 6.2, which allows countries to cooperate in achieving NDC targets through the transfer of Internationally Transferred Mitigation Outcomes (ITMOs). When ITMOs are transferred, Vietnam applies corresponding adjustments by subtracting the sold credits from its national emission reduction results to prevent double counting with the buyer or partner country. These adjustments are reflected in the Biennial Transparency Report (BTR) submitted to the UNFCCC.

Illustrative example

A steel manufacturing enterprise in Thai Nguyen implements a project that uses blast furnace exhaust gas for power generation, achieving annual reductions of 30,000 tCO₂. The enterprise registers these credits according to international standards and plans to sell them to a partner in Europe to help the buyer meet its net-zero target. For this transaction to be valid, Vietnam must record the credits in the national MRV Registry, ensure the enterprise does not simultaneously use the reductions for reporting in its Nationally Determined Contribution (NDC), and apply a corresponding adjustment by subtracting 30,000 tCO₂ from the national emission reduction results, which is then reflected in the UNFCCC report. Without this mechanism, the same 30,000 tCO₂ could be claimed twice, once in Vietnam’s NDC and once by the EU buyer, undermining credibility and risking rejection in international markets.

Significance for SME Businesses

Compliance with Vietnam’s double-counting prevention mechanism is mandatory for SMEs wishing to legally trade carbon credits internationally, have credits recognized in mandatory markets such as CORSIA or the EU ETS, or participate in bilateral cooperation mechanisms under the Paris Agreement (e.g., Japan’s Joint Crediting Mechanism). Therefore, SMEs must clearly establish credit ownership from the outset, avoid selling or announcing credits not registered in the national system, and seek legal or technical consultation when engaging in international transactions to prevent errors and ensure credibility.