KUALA LUMPUR: Malaysia's newly launched voluntary carbon market, the Bursa Carbon Exchange (BCX), does not restrict the sale of carbon credits generated from Malaysia-based projects to overseas buyers.
Natural Resources, Environment and Climate Change Minister Nik Nazmi Nik Ahmad said there had been many inquiries on Malaysia's policy on carbon trading across national borders.
Specifically, he said project developers and potential investors have been asking if any restrictions are imposed on selling carbon credits generated from projects in Malaysia to international buyers.
"Under a voluntary carbon market, there is no restriction imposed on the sales of carbon credits generated from projects located in Malaysia to buyers outside of the country," he said at the launch of BCX here today.
Meanwhile, Nik Nazmi said Malaysian carbon credits traded under the BCX are not authorised to meet the Nationally Determined Contribution (NDC) of other countries or for other international mitigation purposes, as this requirement has already been incorporated into the BCX Rules.
He also clarifies that trading carbon credits generated from projects in Malaysia through the BCX does not require approval from the Natural Resources, Environment and Climate Change ministry.
"However, we would require that all domestic carbon projects registered in all international carbon credit registries, such as Vera, Gold Standard, and others, be reported to the ministry.
"The information to be reported is stipulated in the National Guidance on Voluntary Market Mechanisms which can be accessed through my ministry's website," he said.
In addition, Nik Nazmi has called for the corporate sector to support BCX's inaugural carbon credit auction, which is crucial to the successful implementation of the market-based initiative.
"Your organisations can emerge as first movers in this voluntary carbon market (VCM) space.
"This will allow you to play a key role in setting local industry benchmarks in supply and demand, to facilitate the growth of the VCM ecosystem," he said.
BCX is the world's first shariah-compliant carbon trading exchange, which covers the standardised carbon credit products to be traded on the platform.
Corporate buyers interested in participating in the VCM inaugural auction and purchasing carbon credits can register at Bursa Malaysia official website.