PORTUGAL Law and Practice Contributed by: Assunção Cristas, Catarina Pinto Correia and Carolina Vaza, VdA
permit allowing them to emit greenhouse gases, which must be monitored annually and sent to the Portu- guese Climate Agency. The permit is annexed to the environmental licence of the operator issued under the Industrial Emissions Regime. Concerning the vol - untary carbon markets – seen as a powerful tool to support the NDCs under Article 6 of the Paris Agree - ment – it should be highlighted that a national trend to compensate greenhouse gas emissions through these markets is emerging. Indeed, since 6 January 2024, Decree-Law No 4/2024 has entered into force, which establishes the voluntary carbon market (VCM) and lays down the rules for its operation. The VCM cov - ers greenhouse gas emission reduction projects and carbon sequestration projects, if they are developed on national territory. Its operating mode can be briefly described as follows: • carbon projects shall be developed according to methodologies for each approved typology (such as forests and “blue carbon”); • the reduction of GHG emissions or carbon seques - tration within the voluntary carbon market gener - ates carbon credits; • one carbon credit corresponds to one tonne of CO₂; • carbon projects and carbon credits are recorded on a public platform specifically provided for this purpose and may be traded between voluntary car - bon market actors or used by their holders; • the use of credits could be either for emission compensation or for contributing to climate action; and • once used, the carbon credits must be cancelled on the public platform. A technical committee has already been established to support the development of carbon methodologies, which will be submitted to the ApC for approval, and to monitor the voluntary carbon market. The first methodology for carbon projects concerning new afforestation has been approved and two oth - ers, related to active forest management and natu - ral reforestation, are under preparation. Meanwhile, the requirements for the certification of independent verifiers have been published and the public regis - try platform for carbon projects and credits has been
regulated and is in place, making the voluntary car - bon market fully operative. Although it has not moved on, the first fund in Portugal that foresees carbon sequestration rights namely as a way to remunerate in kind a class of fund units, considered a dark green investment under Article 9 of the Sustainable Finance Disclosure Regulation (SFDR), was approved by the Portuguese Securities Market Commission (CMVM) in February 2023. An additional note regarding Reg - ulation (EU) 2024/3012 of the European Parliament and of the Council of 27 November 2024 entered into force on 26 December 2024. The regulation estab - lishes an EU certification framework for permanent carbon removals, carbon farming and carbon storage in products and the first methodologies have been put to public consultation. The aim of the Regulation is to establish rules in the EU for carbon credit certification schemes to make sure that they: • issue carbon credits that reflect actual and verifi - able removals or reductions in soil emissions; • ensure transparency and trust in carbon markets through disclosure requirements and interoper - ability between their platforms, avoiding double counting of credits; and • ensure environmental integrity by promoting asso - ciated biodiversity benefits while avoiding green washing. The regulation is voluntary; however, it is likely that the demand side of the carbon markets will move towards favouring credits issued under the regulation. This is because credibility will be key to the growth of this market, and carbon removal/reduction tokens that comply with the rules will benefit from enhanced credibility. The certification system established by the regulation in question does not directly apply to the carbon credits themselves, but rather to the certifica - tion frameworks, or carbon markets, through which these credits are issued and recorded. Recognition of these certification frameworks is granted by a decision of the European Commission, which evalu - ates whether the market’s rules are robust enough to ensure that the carbon projects and credits admit - ted to the framework comply with the Regulation’s standards and thus merit the associated credibility. These certification frameworks are obliged to submit annual reports to the Commission, providing ongoing
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