Indonesia is making significant strides in carbon trading as part of its strategy to reduce greenhouse gas emissions and achieve sustainability goals. However, despite the government's commitment—evidenced by the launch of IDXCarbon and Indonesia’s participation in COP29—several regulatory gaps persist. Key challenges include unclear transaction procedures, pricing mechanisms, and ownership validation of carbon units, creating uncertainty for businesses looking to navigate and participate in the evolving market.

In this article, Dentons HPRP lawyers—Maurice Maulana Situmorang (Partner), Winda Tania (Partner), Reyner Mulia (Associate), and Audrey Florence Natalia Sitepu (Associate)—explore the complexities of Indonesia’s carbon trading landscape. They analyze critical regulatory shortcomings, compare international best practices, and propose solutions to strengthen Indonesia’s carbon market for long-term sustainability.

Read on to uncover the key issues and potential pathways for a more robust regulatory framework. Downloaded here.

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