Decree 119/2025/ND-CP: Key changes businesses must know

Decree 119/2025/ND-CP will come into force on August 1, 2025. This important legal document strengthens greenhouse gas (GHG) management, introduces emission quota allocation, and sets out the roadmap for a domestic carbon market. It not only creates legal obligations but also opens opportunities for businesses to move toward green transformation in line with Vietnam’s Net Zero 2050 commitment.

1. Notable Points in Decree 119/2025/ND-CP  

1.1. Key differences between Decree 119/2025/ND-CP and Decree 06/2022/ND-CP  

Content	Decree 06/2022/ND-CP	Decree 119/2025/ND-CP	Key Change
GHG inventory	Annual reporting, based on list issued by PM	From 2026: some sectors (thermal power, cement, steel) inventory every 2 years	Lower frequency but broader responsibility for key industries
Emission quota	Not specified in detail	Allocated based on emission levels, reduction potential, technology, and financial capacity	First-time detailed allocation mechanism
Carbon trading floor	Oriented for pilot development	Pilot until 2028, then official with auction mechanism	Clear roadmap and timeline

This shows that Vietnam has made significant progress from a legal framework orientation (Decree 06/2022) to a specific operational mechanism (Decree 119/2025), enabling businesses to be more proactive in managing emissions and participating in the carbon market.  

1.2. Greenhouse Gas Inventories from 2026 

According to the decree, major emitters will be required to conduct periodic greenhouse gas inventories. 

Amendment to Article 11, Clause 4 of Decree 06/2022: 

“c) Thermal power plants, steel production facilities, and cement production facilities on the list of greenhouse gas emitters issued by the Prime Minister must prepare facility-level greenhouse gas inventory reports every two years from 2026 onwards, using Form 06 in Appendix II attached to this Decree. These facilities are exempt from the provisions in Point b of this clause;” 

This means that from 2026, key sectors must submit biannual inventory reports following a standardized format. These reports help the government ensure transparent emission management while enabling businesses to control risks and save costs through better energy management.  

1.3. Greenhouse gas emission quotas 

Another important regulation is the emission quota mechanism: 

“3. Method for determining greenhouse gas emission quotas 

a) Quotas are determined based on emission levels per unit of product; sectoral growth targets; emission reduction goals of the sector and facilities according to business plans; reduction potential of facilities; and their technical, technological, and financial capacity for implementing emission reductions.” 

Each business will be assigned a maximum emission quota within a given period. If actual emissions are lower than the quota, the surplus can be sold on the carbon market. If emissions exceed the quota, businesses must purchase additional quotas or carbon credits to offset. This mechanism encourages technological innovation and provides economic advantages for pioneering companies that reduce emissions. 

1.4. Pilot Carbon Trading Platform until 2028 

To facilitate credit and quota trading, the decree provides a roadmap for establishing a domestic trading platform: 

“The domestic carbon credit trading platform will be piloted until the end of 2028; after this period, the platform will operate officially with an auction mechanism for emission quotas.” 

This means that from now until 2028, businesses can test carbon credit trading under the pilot scheme. After the pilot phase, the carbon market will officially operate with an auction mechanism, ensuring transparency and fair competition. This is also a vital step for Vietnam to integrate into the global carbon market.

2. The Role of Businesses in the Net Zero Roadmap 

Implementing Decree 119/2025/ND-CP is not only a legal obligation but also an opportunity for businesses to strengthen their position. Complying with emission inventories, managing quotas, and participating in the carbon market will reduce legal risks, enhance international credibility, and attract investment.  

What should businesses prepare right now? 

To avoid being passive, businesses should: 

• Set up emission data collection and aggregation systems – ensuring transparency and compliance with standardized forms. 
• Review current technology – assess emission reduction potential and identify necessary improvements to meet new criteria. 
• Develop financial plans – prepare for carbon market participation: purchasing credits, borrowing quotas, or transferring as needed. 
• Monitor related tax law drafts – for example, potential corporate income tax exemptions for initial carbon credit transactions, to maximize benefits. 

By preparing early, businesses can not only comply with the law but also take advantage of opportunities for sustainable growth and global integration. 

3. Uzero – Business support solution 

💡 To meet new regulations, Uzero – a joint product of Udata and Zeroboard (*), provides a comprehensive emission management platform. It helps businesses calculate accurately according to Decision 2626/QD-BTNMT 2022 on emission factors and visualize emission hotspots on a dashboard.

(*) Zeroboard is Japan’s leading SaaS platform that helps businesses calculate and manage greenhouse gas emissions according to international standards, with more than 14,000 global clients. 

Get started with Udata’s product trial at: https://udata.ai/en/free-trial

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