Singapore and Lao PDR sign Implementation Agreement on carbon credits collaboration

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Singapore and Lao PDR Sign Implementation

Agreement on Carbon Credits Collaboration

On 4 September 2026, the Ministry of Trade and Industry issued a press release announcing that

Singapore and the Lao People’s Democratic Republic (Lao PDR) have entered into an implementation agreement (Implementation Agreement) on carbon credits collaboration under

Article 6 of the Paris Agreement.

This is Singapore’s 12th Implementation Agreement on carbon credits collaboration, and its fourth with an ASEAN Member State.

The Implementation Agreement establishes a legally binding bilateral framework for the generation and international transfer of correspondingly adjusted high-integrity carbon credits from carbon mitigation projects aligned with Article 6 of the Paris Agreement. Project developers can leverage this framework to develop high-quality carbon credit projects aligned with the Article 6 rulebook.

Information on the process for authorisation of these carbon credit projects and the eligible carbon crediting methodologies under the Implementation Agreement will be published in due course.

Correspondingly adjusted carbon credits authorised under the Implementation Agreement may be used for various purposes, including:

(a)

Offsetting up to 5% of a company’s taxable emissions under Singapore’s International

Carbon Credits (ICC) framework from 1 January 2024, subject to eligibility; and

(b)

Complying with binding mandates, such as Nationally Determined Contributions (NDCs), and other international mitigation purposes, e.g., the requirements under the Carbon

Offsetting and Reduction Scheme for International Aviation (CORSIA).

Singapore has committed to channelling a 5% share of proceeds from authorised carbon credits under the Implementation Agreement towards climate adaptation measures in Lao PDR.

As a contribution towards a net reduction of global emissions, Singapore is committed to having 2%

of the correspondingly adjusted carbon credits authorised under the Implementation Agreement cancelled at first issuance. Cancelled carbon credits cannot be sold, traded, or counted towards any country’s emission targets.

The collaboration is intended to advance both countries’ climate goals by directing financing towards unlocking additional emissions reduction opportunities in Lao PDR. The carbon credit projects authorised under the Implementation Agreement will foster sustainable development and

Carbon Credits

© WongPartnership LLP

DISCLAIMER: This update is intended for your general information only. It is not intended to be, nor should it be, regarded as or relied upon as legal advice. Court decisions referred to herein may be subject to further appeal at the time of publication, and subsequent developments in the law, including new legislation, amendments, court decisions or practice directions, may affect the accuracy or relevance of the matters discussed. We are under no duty to update this publication to reflect any such changes in the law. You should consult a qualified legal professional before taking any action or omitting to take action in relation to matters discussed herein.

WongPartnership LLP (UEN: T08LL0003B) is a limited liability law partnership registered in Singapore under the Limited Liability

Partnerships Act 2005.

SUSTAINABILITY & RESPONSIBLE

BUSINESS

SEPTEMBER 2026

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