THE EU’s two big green regulations on shipping have had many consequences, whether intended or otherwise. But their original purpose was as a threat.
The EU’s Regulatory Threat and Its Consequences
The EU implemented two significant regulations, the EU Emissions Trading System (ETS) and FuelEU Maritime, to pressure the International Maritime Organization (IMO) into taking action on shipping emissions. The ETS, which began in 2024, requires companies to surrender credits for a portion of their emissions on voyages to and from the EU, with the first credits due by September 30, 2025. The FuelEU Maritime regulation, also being phased in, fines companies that don’t transition to greener fuels over time. These measures were designed to be a threat to the IMO: if the global body didn’t act, the EU would enforce its own rules.
The IMO’s Response: A Global Net-Zero Framework
The EU’s strategy appears to have been successful. The IMO has developed a global net-zero framework for cutting shipping emissions, which is expected to be formally adopted in October 2025. This framework includes a global fuel standard and an emissions pricing mechanism, with the goal of achieving net-zero emissions by or around 2050. The framework’s measures would enter into force in 2027.
The EU’s Next Move: Alignment or Continued Independence?
With a global regime on the horizon, the question now is whether the EU will align its regional regulations with the new IMO framework. The European Commission has stated it will consider changing its regulations if it deems the IMO’s system ambitious enough. There are concerns within the industry about “double taxation” and maintaining a level playing field. The EU’s regulations, including the ETS and FuelEU Maritime, have review clauses that mandate an assessment of how well the IMO’s measures align. The podcast will feature two guests, Magda Kopczyńska of the European Commission and Simon Bennett of the International Chamber of Shipping, who are well-positioned to discuss the implications of the IMO’s framework and the path forward for EU regulations.
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Source: Lloyd’s List
