The new international initiative to strengthen global cooperation on carbon pricing builds on from the declaration endorsed by Commission President Ursula von der Leyen among other world leaders at COP30 in Belem, Brazil, in November 2025.
The Coalition will enhance the effectiveness, transparency and integrity of domestic carbon markets worldwide, supporting the delivery of the Paris Agreement. It will provide a platform for cooperation on the development and strengthening of domestic carbon markets and carbon pricing policies. Its work will focus on key elements such as robust monitoring, reporting and verification systems, sound carbon accounting methodologies and the potential use of high integrity offsets to promote environmental integrity.
The signing ceremony and the Coalition’s constitutional meeting took place in Florence, Italy, with the participation of the Commission’s Director-General for Climate Action Kurt Vandenberghe, representing the European Union, the Vice Minister of Ecology and Environment of China Li Gao, and the Extraordinary Secretary for Carbon Markets in Brazil, Cristina Reis.
With the adoption of the Coalition’s Terms of Reference, the Coalition is now open to countries with nationwide compliance carbon markets, such as emissions trading systems or a carbon tax. Subnational authorities operating a carbon pricing scheme can participate as observers.
New Zealand and Germany are the first countries to join as members, with several others expected to follow. Brazil will chair the Coalition for the first two years, with China and the European Commission as Co-Chairs. Next steps include establishing the Coalition’s Secretariat and developing a work plan to be adopted at the Carbon Market Conference taking place on 15 September 2026 in Wuhan, China.
With around 80 carbon pricing schemes in place across 50 different countries, there is a clear benefit to working together under this Coalition: fostering mutual understanding, promoting best practices, and raising global standards. For the EU, this is an opportunity to advance carbon pricing as the most cost-effective tool to reduce emissions, building on over 20 years of experience with the EU Emissions Trading System.
Beyond its technical work, the Coalition sends a strong signal of renewed multilateral cooperation and shared commitment to the Paris Agreement. It reinforces the role of carbon markets as a central pillar of the global transition to climate neutrality, while supporting economic modernisation and competitiveness.
The Commission is entering the Coalition with a clear set of priorities for the workplan:
- enhance domestic carbon pricing effectiveness,
- encourage a race to the top for carbon credits quality, building on the work of Article 6.4 of the Paris Agreement Crediting Mechanism,
- assess how carbon accounting methods can be compared and whether suggestions can be made to facilitate corporate compliance across systems, building on the work the Climate Club.
Kurt Vandenberghe, Director-General for Climate Action at the European Commission said: “This is a good day for climate action. Together with Brazil, China, Germany, New Zealand – and with more countries to join soon – we are forming the Open Coalition on Compliance Carbon Markets and starting its work. Together, we will make emissions trading systems more effective, robust and transparent. Ultimately, our collaboration should reduce greenhouse gas emissions whilst growing, modernising and innovating our economies. The EU ETS is a great example – it has directly helped us to reduce emissions by 50% in the concerned economic sectors while raising EUR 260 billion in revenues to boost decarbonisation and innovation. Today’s launch of the Open Coalition in Florence is a success of our climate diplomacy and it shows the commitment of all participants to the Paris Agreement. We invite all countries with a carbon pricing legislation in place to express their interest and join the Coalition.”
