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Japan: First exchange-based carbon market launched on 11 October 2023

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In brief

The Tokyo Stock Exchange (TSE) launched Japan’s first exchange-based carbon credit market (“Market“) on 11 October 2023. Registered participants in the Market now have a more efficient platform for carbon credit trading in Japan and improved carbon pricing transparency.

As of October 2023, a total of 188 applicants — including many GX League Members — had registered as participants in the Market, enabling them to trade J-Credits — the only eligible carbon credit on the Market for the time being.

The launch of the Market encourages Japanese companies to curb greenhouse gas (GHG) emissions in Japan, the world’s fifth largest CO2 emitter. It also supports GX (Green Transformation) in Japan and bolsters the global supply of carbon credits to help the world meet its ambitious GHG emission reduction goals.

Key takeaways

Solvent legal entities, including foreign corporations, can register and trade eligible carbon credits on the Market by meeting specific requirements and establishing the necessary accounts.

If you have any questions or would like further information about this topic, please do not hesitate to contact us.

Click here to read the full alert.

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Author

Kana Itabashi is a member of the Corporate/M&A practice group at the Firm's Tokyo office and a member of Global International Commercial & Trade practice group. Kana has over twenty years of legal experience and has broad experience advising multinational companies in various industries on international trade and cross border commercial issues, including trade remedies, export control, sanctions, import/export regulatory issues, as well as highly regulated commercial agreements.
Prior to joining the firm, she worked as a junior accountant at a major auditing firm, where she mainly performed accounting audits for listed companies, etc. From 2007 to 2009, she was seconded to the principal investment department of a major Japanese securities company, where she was involved in private equity investments, emissions trading and various other investment projects.

Author

Fei Zhou is a member of the Finance & Project group at Baker McKenzie's Tokyo office. Prior to joining the Firm, she worked for prominent law firms in Shanghai, Tokyo and New York.

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