On 19 December 2023, the Ministry of Sustainability and Environment (“MSE“) and the National Environment Agency (“NEA”) published the Eligibility List under the International Carbon Credit Framework (“ICC Framework“), which is effective from 1 January 2024.
The ICC Framework allows carbon tax-liable companies to use eligible international carbon credits (“ICCs“) to offset up to 5% of their taxable emissions. The Eligibility List specifies the eligible ICCs. The ICC Framework was introduced in November 2022, alongside the progressive increase in carbon tax rate under the Carbon Pricing (Amendment) Act 2022.
The Eligibility List details the host country, carbon crediting programme and methodologies that adhere to the Eligibility Criteria under the ICC Framework. MSE and NEA set out the Eligibility Criteria in October 2023. Please refer to our Legal Update titled “Prescribed Criteria for International Carbon Credits under Singapore’s Carbon Tax Regime” for details regarding the Eligibility Criteria.
To maintain the Eligibility List’s relevance and to uphold high environmental integrity standards, NEA, as the administrator of Singapore’s carbon tax regime, will conduct annual reviews founded on the latest science and evidence. Accordingly, carbon crediting programmes and methodologies would be added or delisted from the Eligible List.
The Eligibility List is published on Singapore’s Carbon Markets Cooperation website here. Currently, Papua New Guinea is the sole host country on the Eligibility List. This inclusion ensues from the Implementation Agreement for carbon credits cooperation under Article 6 of the Paris Agreement signed between Singapore and Papua New Guinea on 8 December 2023 at the sidelines of the UN Framework Convention for Climate Change (UNFCCC) COP28. The Implementation Agreement sets out a legally binding framework aligned with Article 6 of the Paris Agreement for the authorisation, reporting, and international transfer of carbon credits with corresponding adjustments.
Companies can refer to NEA’s Guidance Document on the administrative processes under the ICC Framework. It covers the Eligibility Criteria of ICCs, steps on sourcing and procuring eligible ICCs, and steps on surrendering the ICCs to NEA. The Guidance Document is available on the NEA website here.
Click on the following links for more information (available on the MSE website at www.mse.gov.sg):
- Joint Media Release by MSE and NEA titled “Singapore publishes eligibility list for international carbon credits under the carbon tax regime”
- Speech by Ms Grace Fu, Minister for Sustainability and the Environment, at the Implementation Agreement Signing Ceremony with Papua New Guinea on 8 December 2023
- MSE Press Release titled “Singapore signs first Implementation Agreement with Papua New Guinea to collaborate on Carbon Credits under Article 6 of the Paris Agreement”
- Factsheet on Singapore’s participation at COP28
