The International Maritime Organization (IMO) has agreed on a Net-Zero Framework for shipping. It is the first in the world to combine mandatory emissions limits and greenhouse gas (GHG) pricing across an entire industry sector. The KVNR, ICS, European Shipowners | ECSA, and WSC welcome the deal, but also warn much work still needs to be done.
Approved by the Marine Environment Protection Committee during its 83rd session (MEPC 83) from 7–11 April 2025, the measures include a new fuel standard for ships and a global pricing mechanism for emissions. It marks an important step towards establishing a legally binding framework to reduce greenhouse gas (GHG) emissions from ships globally, aiming for net-zero emissions by or around, that is, close to 2050.
The measures, set to be formally adopted in October 2025 before entry into force in 2027, will become mandatory for large ocean-going ships over 5000 gross tonnage, which emit 85 per cent of the total CO2 emissions from international shipping.
‘Creating the conditions for successful adoption’
Closing the meeting, IMO Secretary-General Arsenio Dominguez commended the spirit of cooperation and commitment demonstrated by member states: ‘The approval of draft amendments to MARPOL Annex VI mandating the IMO Net-Zero Framework represents another significant step in our collective efforts to combat climate change, to modernise shipping and demonstrates that IMO delivers on its commitments.’
He adds: ‘Now, it is important to continue working together, engaging in dialogue and listening to one another, if we are to create the conditions for successful adoption.’
Also read: IMO Secretary-General visits STC in Rotterdam
Key elements of the Net-Zero Framework
The IMO Net-Zero Framework will be included in a new Chapter 5 of Annex VI (Prevention of air pollution from ships) to the International Convention for the Prevention of Pollution from Ships (MARPOL). MARPOL Annex VI currently has 108 Parties, covering 97 per cent of the world’s merchant shipping fleet by tonnage, and already includes mandatory energy efficiency requirements for ships.
The goal is to achieve the climate targets set out in the 2023 IMO Strategy on the Reduction of GHG Emissions from Ships, accelerate the introduction of zero and near zero GHG fuels, technologies and energy sources, and support a just and equitable transition.
Under the draft regulations, ships will be required to comply with:
- Global fuel standard: Ships must reduce, over time, their annual greenhouse gas fuel intensity (GFI) – that is, how much GHG is emitted for each unit of energy used. This is calculated using a well-to-wake approach.
- Global economic measure: Ships emitting above GFI thresholds will have to acquire remedial units to balance its deficit emissions, while those using zero or near-zero GHG technologies will be eligible for financial rewards.
Ensuring compliance
There will be two levels of compliance with GHG Fuel Intensity targets: a Base Target and a Direct Compliance Target at which ships would be eligible to earn “surplus units”. Ships that emit above the set thresholds can balance their emissions deficit by:
- Transferring surplus units from other ships.
- Using surplus units they have already banked.
- Using remedial units acquired through contributions to the IMO Net-Zero Fund.
Also read: 47 governments propose GHG emissions pricing to IMO
IMO Net-Zero Fund
The IMO Net-Zero Fund will be established to collect pricing contributions from emissions. These revenues will then be disbursed to:
- Reward low-emission ships.
- Support innovation, research, infrastructure and just transition initiatives in developing countries.
- Fund training, technology transfer and capacity building to support the IMO GHG Strategy.
- Mitigate negative impacts on vulnerable states, such as Small Island Developing States and Least Developed Countries.
Next steps
Upon approval, the draft amendments to MARPOL Annex VI will be formally circulated to IMO Member States, followed by:
- October 2025 (MEPC/ES.2): Adoption of the amendments during an extraordinary session of the Marine Environment Protection Committee.
- Spring 2026 (MEPC 84): Approval of detailed implementation guidelines.
- 2027: Expected entry into force, sixteen months after adoption (in accordance with MARPOL articles).
Also read: ‘EU leads the way, IMO losing influence’
Industry response
Not all IMO member states were equally enthusiastic about the text of the agreement in principle at the end. Oil-producing countries in particular opposed the text and thought the ambitions were too high. There were also many developing countries in the Pacific that actually wanted much stricter standards towards 2030 and beyond. They abstained in protest against the agreement in principle.
A rather unique situation arose within the IMO where work is almost always consensus-based. Earlier this week, there was consternation over the Americans’ message that the US would no longer participate in IMO meetings.
KVNR
The Royal Association of Netherlands Shipowners (KVNR) welcomes the agreement, though much work remains before 2028. KVNR climate advisor Nick Lurkin says that the system is complex, combining greenhouse gas pricing with tradable carbon credits across fleets adding that KVNR would have preferred a global levy and fuel standard, but that wasn’t acceptable to several key IMO states.
Emission reduction targets through 2035 and prices for 2028–2030 are set, but key IMO guidelines must still be developed. These include managing the Net Zero Fund, set to collect billions, supporting clean fuel production, third-party verification, and defining emission levels for alternative marine fuels.
The KVNR urges the EU to reassess FuelEU Maritime and the EU ETS during next year’s review. Lurkin concludes: ‘Shipping is pre-eminently international and does not stop at national or European borders. Moreover, climate change is an issue with global implications. The global approach is therefore more effective, despite the current vagaries of an international trade war.’
ICS
Guy Platten, Secretary General of the International Chamber of Shipping (ICS) speaks of a ‘historic moment’ for the industry. He stresses, however, that ‘Shipowners and energy producers need a workable, transparent, and simple-to-administer regulatory framework that will create the necessary incentives to accelerate the energy transition at the pace required. We are pleased that governments have understood the need to catalyse and support investment in zero emission fuels, and it will be fundamental to the ultimate success of this IMO agreement that it will quickly deliver at the scale required. […] We hope that this agreement will now provide the certainty which energy producers urgently need to de-risk their huge investment decisions.’
He also recognises that this may not be the deal that ‘all sections of the industry would have preferred’ and he expresses concern as to whether the Framework goes ‘far enough in providing the necessary certainty.’ He concludes: ‘But it is a framework which we can build upon. We will be studying the technical detail over the coming weeks, and will continue to support the IMO process so that we have a system that also works in company board rooms as well as the governments’ negotiating rooms.’
European shipowners | ECSA
European Shipowners | ECSA is of the same opinion as the ICS. Sotiris Raptis, Secretary General of European Shipowners | ECSA, says: ‘Even though the agreement is not perfect, it is a good starting point for further work. It is a framework which we can build upon to ensure the necessary investment in the production of clean fuels.’
The organisation also adds that ‘shipping is an international industry which requires meaningful global regulations to decarbonise. Global regulation is essential to ensure a level playing field at international level and to deliver the energy transition of international shipping.’
World Shipping Council
World Shipping Council (WSC) President and CEO Joe Kramek also speaks of a ‘major milestone for climate policy and a turning point for shipping’. He feels ‘a global regulation is necessary to deliver the renewable fuels at a commercially viable price. Outcomes from the IMO today mean global regulations can now begin to leverage the record industry investment to meet decarbonization targets.’
Other MEPC 83 outcomes
The meeting discussed a range of issues related to protecting the marine environment from shipping activities, with the following key outcomes:
- Adoption of 2025 Action Plan to combat marine plastic litter.
- Progress in the review of the Ballast Water Management Convention.
- Approval of a proposal to designate the North-East Atlantic as an Emission Control Area and agreement in principle to designate two new Particularly Sensitive Sea Areas off South America’s Pacific coast.
- Approval of the draft work plan on the development of a regulatory framework for the use of onboard carbon capture storage systems (OCCS).
- Approval of draft amendments to regulation 27 of MARPOL Annex VI regarding accessibility of the IMO Data Collection System.
- Adoption of amendments to the 2021 Guidelines on the operational carbon intensity reduction factors relative to reference lines (CII reduction factors guidelines, G3).
- Approval of a new output to develop a legally binding framework on biofouling management, to prevent the spread of harmful invasive aquatic species.
Also read: BIMCO and ICS launch guide targeting underwater noise
