- WSC urges EU ETS alignment with IMO Net Zero Framework.
- Avoiding dual regulation can strengthen competitiveness, coherence, and global decarbonization.
- Strategic opportunity to reinforce multilateralism and unlock renewable fuel adoption in Europe.
The World Shipping Council (WSC) has released a position paper urging the European Union to strategically align its Emissions Trading System (EU ETS) with the forthcoming IMO Net Zero Framework, expected to be adopted in October 2025. The alignment, WSC argues, is essential to prevent overlapping carbon pricing regimes, maintain competitiveness, and support effective climate action across global shipping.
Global Framework as a Turning Point for Shipping Decarbonization
The IMO Net Zero Framework represents a major global milestone, forged through extensive collaboration and spearheaded in part by European leadership. This framework aims to:
- Implement a global well-to-wake GHG pricing mechanism
- Introduce performance-based fuel and technology requirements
- Support net-zero emissions targets in line with the Paris Agreement
The economic principles of the EU ETS are embedded in the IMO system, which also integrates fuel intensity (GFI) targets and a mechanism for trading Surplus Units via the IMO GFI Registry. This makes it possible for vessels that outperform emissions targets to transfer credits within the industry.
WSC, representing global liner shipping, has contributed to both the European and international development of these frameworks and fully supports the adoption of the IMO Net Zero Framework as a global standard.
The Case Against a Dual Carbon Pricing Burden
WSC emphasizes that applying both the EU ETS and the IMO Net Zero Framework to the same emissions would create unnecessary regulatory and economic burdens:
- Duplicated costs for ship operators
- Distorted regional trade patterns
- Reduced port competitiveness
- Contradictory signals undermining the EU’s multilateral climate stance
A regional-only approach risks unintended consequences for European ports, logistics chains, and global trade routes — particularly affecting developing countries whose cargoes transit through or into the EU.
Comparative Benefits of Global Alignment
While both systems cover ships above 5,000 GT, the IMO framework offers far broader geographic coverage, addressing six times the emissions scope compared to the regional EU ETS. Key GFI targets proposed under IMO include:
- 30–40% emissions reduction by 2035
- 65% reduction by 2040
- Net-zero emissions around 2050
WSC supports revisiting the EU ETS following adoption of the IMO Framework, using the EU’s legislative review process to synchronize scope and design. Doing so would uphold the EU Climate Law’s 2050 neutrality target, while ensuring coherence and efficiency across regulations.
Strategic Opportunity for Green Fuel Acceleration
Harmonizing with IMO’s framework could also catalyze Europe’s transition to renewable marine fuels:
- The IMO’s GHG pricing model helps narrow the cost gap between fossil fuels and cleaner alternatives.
- Surplus Unit trading offers financial incentives for early adopters of low-carbon tech.
- EU port investments in fuel infrastructure and green fuel incentives would further secure Europe’s maritime competitiveness.
WSC highlights that the EU has a window of opportunity to pivot from a unilateral to a multilateral climate leadership position — aligning policy, enhancing collaboration, and ensuring competitiveness.
A Well-Timed Alignment for Policy Coherence and Port Resilience
With the IMO Net Zero Framework set for 2027 and an EU ETS revision proposal expected by end-2026, WSC states that now is the ideal moment for coordination. Aligning timelines would:
- Enable smooth legislative integration
- Support harmonized market conditions
- Mitigate risks of carbon leakage and trade diversion
Moreover, EU law already mandates monitoring for non-competitive impacts due to EU ETS. WSC believes that alignment will help neutralize such effects, particularly for transshipment-dependent developing countries, and reinforce the EU’s commitment to an equitable climate transition.
Coherent Policy for a Global Challenge
WSC concludes that aligning the EU ETS with the IMO Net Zero Framework is not only logical, but critical. It ensures efficient climate action, preserves European economic interests, and strengthens the EU’s role in driving global maritime decarbonization.
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Source: safety4sea
