Can I Buy Carbon Credits in China as a Foreign Company?
Yes, foreign companies can buy carbon credits in China, but access is structured and requires navigating specific regulatory channels. As of 2025, over 80 million tonnes of Chinese Certified Emission Reductions (CCER, 国家核证自愿减排量, guójiā hézhèng zìyuàn jiǎn pái liàng) have been issued since the market reopened in January 2024, after a 7-year suspension. Foreign entities typically participate through on-exchange trading on the Shanghai Environment and Energy Exchange or via over-the-counter (OTC) agreements with registered Chinese project owners.
Understanding China’s Carbon Credit Market: CCER vs. ETS Allowances
China operates a dual system: a mandatory Emissions Trading Scheme (ETS, 全国碳排放权交易市场, quánguó tàn páifàng quán jiāoyì shìchǎng) for domestic covered entities, and a voluntary CCER market open to all parties, including foreign companies. The ETS covers 2,160+ power sector companies and trades carbon allowances (CEA), which are restricted to Chinese entities only. The CCER system, however, is the primary vehicle for foreign buyers.
Current CCER pricing ranges from RMB 60 to RMB 90 per tonne, compared to ETS allowances trading at RMB 70-100 per tonne. The price differential reflects project verification costs and market liquidity. As of Q1 2025, cumulative CCER trading volume reached 45 million tonnes, with monthly averages of 3-5 million tonnes. The market has grown 12 times in volume since reopening, driven by corporate net-zero commitments and international demand.
Key CCER project types include renewable energy (wind, solar, biomass), forestry carbon sinks, and methane capture. Over 1,200 projects have been registered under the new methodology, with an average project size of 50,000 tonnes per year. Foreign companies can only purchase credits from projects that have completed rigorous third-party verification and listing on the national registry.
How Foreign Companies Can Buy Carbon Credits in China
Foreign companies have three main pathways to purchase CCERs. The direct route is to open a trading account on the Shanghai Environment and Energy Exchange (SEEE) or the Beijing Green Exchange, provided the company has a legal presence in China (e.g., a WFOE, 外商独资企业, wàishāng dúzī qǐyè). Offshore-only entities must use a licensed broker or a carbon asset management company registered in China as an intermediary.
The second pathway is through bilateral OTC contracts with CCER project developers. This requires due diligence on project eligibility and credit quality. The third option is carbon credit funds or trusts managed by Chinese financial institutions that pool foreign capital and trade CCERs on behalf of clients.
| Purchase Method | Foreign Entity Requirement | Typical Volume (tonnes) | Cost Range (per tonne) | Settlement Time |
|---|---|---|---|---|
| On-exchange (SEEE) | China-based legal entity (WFOE or JV) | 1,000 – 500,000 | RMB 60 – 80 | 1-2 days |
| OTC with project developer | Offshore entity OK with broker | 10,000 – 1,000,000 | RMB 55 – 85 | 1-4 weeks |
| Carbon fund/trust | Offshore entity OK | 50,000 – unlimited | RMB 60 – 90 (plus fees) | Quarterly |
Decision Framework: If your company has a registered China subsidiary (WFOE or joint venture), choose on-exchange trading for lowest cost and fastest settlement. If your company is entirely offshore, choose the OTC broker route or a carbon fund. If your company wants to offset a specific project footprint, choose OTC with direct project traceability.
Key Requirements and Restrictions for Foreign Buyers
Foreign companies must comply with several regulatory constraints. First, all CCER transactions must be conducted through a Chinese exchange or an approved intermediary. Second, credits cannot be exported or retired outside China, meaning they are only valid for domestic or international voluntary claims if the buyer ensures chain-of-custody documentation. Third, there is a mandatory holding period of 30 days for CCERs purchased on-exchange before they can be transferred or retired.
Tax implications are also critical. As of 2025, carbon credit transactions are subject to a 6% value-added tax (VAT) on the trading fee, and foreign entities may face withholding tax of 10% on income from CCER sales, depending on double-taxation treaties. Companies should engage a Chinese tax advisor to structure the deal properly.
Additionally, foreign buyers must provide a declaration of intended use for the credits—whether for compliance, voluntary offset, or investment. Speculative trading by foreign entities is restricted; the market regulator requires evidence of a genuine carbon management need. This rule has reduced foreign participation by roughly 40% compared to pre-2020 levels.
Frequently Asked Questions
Q: Can I buy CCERs for compliance under international standards like CORSIA?
Yes, CCERs are recognized under CORSIA for the 2024-2026 pilot phase, but only if the credits are from eligible project types (renewable energy, forestry). As of 2025, 34% of registered CCER projects qualify. Buyers must request a “CORSIA-eligible” certification from the project developer.
Q: What is the minimum purchase size?
On-exchange trades require a minimum of 1 tonne per order. OTC contracts typically start at 10,000 tonnes to be cost-effective. Carbon fund minimum investments range from RMB 500,000 to RMB 5 million.
Q: How long does it take to set up a trading account?
For a foreign WFOE, account opening takes 5-10 business days. Offshore entities using a broker can start trading within 1-2 business days after signing a service agreement. However, compliance due diligence may extend this to 2-4 weeks.
Q: Are there any restrictions on the nationality of the foreign company?
No, there are no explicit nationality restrictions. However, companies from countries under trade sanctions (e.g., North Korea, Iran) may face additional review. Companies from the US, EU, Japan, and Singapore have the highest ease of access due to established bilateral agreements.
Q: Can I retire CCERs for carbon neutrality claims in China?
Yes, retirement is possible through the national registry. However, third-party verification of the claim is recommended. 65% of foreign buyers in 2024 chose to retire their CCERs for domestic use, while the remainder held them for investment or resale.
NEXT STEPS
- Assess your eligibility. Read our detailed guide: Foreign Company Carbon Credit Eligibility in China to determine the best entry route based on your corporate structure.
- Find a registered broker. Use our verified list: CCER Broker Directory for Foreign Buyers to avoid unlicensed intermediaries and ensure compliance.
- Structure your tax and legal framework. Consult our compliance checklist: Carbon Credit Tax and Legal Guide for China to avoid costly pitfalls.
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