The International Maritime Organization faces its most embarrassing vote in years, with member nations set to vote on a groundbreaking global carbon pricing system on shipping emissions. Initially, it began as a climate program but has now become a high-stakes diplomatic battle that has the potential to forever redefine international maritime trade. Whether the long-awaited vision of the world having a coordinated mindset towards decarbonizing the seas or not will be gained will depend on the result.
IMO finalizes historic vote on carbon levy of shipping worldwide
Search Marine Environment Protection committee is meeting October 14-17 to discuss a draft marine fuel emission standard that will address ships greater than 5,000 gross tons. This is a Net Zero Framework that would levy penalties on ships surpassing specified CO₂-generating targets that would establish the first worldwide, orchestrated, marketplace-driven tool for decarbonizing the oceans.
Research from University College London estimates annual revenues of between $11-12 billion in 2028-30, where the vast majority of vessels are expected to pay penalties rather than meet thresholds at first. The mechanism would set thresholds above which vessels would have to buy emissions units to redeem themselves or pay direct penalties, and thresholds below which such vessels would earn surplus emissions units that could be traded in future compliance markets.
The framework has a scope that targets the entire international shipping segment of over 5,000 GT, including around 90% of all shipping emissions worldwide. Currently, maritime transport is responsible for about 3% of total global greenhouse gas production, making this sector virtually a key part of the worldwide decarbonization initiatives as well as climate change mitigation plans.
EU coalition supports ambitious decarbonization schedule
Member states of the EU reiterated their request to adopt it quickly, positioning the move as being in line with the Fit for 55 decarbonization package, as well as the FuelEU Maritime regulation, which seeks to reduce the intensity of maritime GHGs by 80 per cent by 2050.
This is the place where the secret fact turns pandemonium: the United States has gone further than just opposition to the active threats to the supporting countries. Last week, Washington threatened countries voting in favor of the framework with sanctions, visa restrictions, and port levies, denouncing it as a “global carbon tax on the world”. On October 11, the US State Department went further, describing the prospect as a “European-led neocolonial export of global climate regulations.”
These unprecedented threats are a dramatic departure from what is known as the typical way diplomacy is discussed in international organizations. The US withdrew from the April 2025 preliminary agreement, and in warning of “reciprocal measures” against backers, has thrown uncertainty into the future of that framework as the vital vote nears.
China and the leading powers do not give in to pressure
Countries that are highly dependent on the maritime industry, such as the Philippines and Caribbean islands, would be especially vulnerable to US visa restrictions and sanctions.
A European source told AFP that US threats could have implications for “countries more sensitive to US influence and vulnerable to these retaliations, which could make the vote tighter than it would otherwise have been, with a risk of a higher level of abstention.”
Key framework details:
- Targets ships of 5,000g tons (90% of emissions)
- Expected 11-12 billion dollars of annual revenue by 2030
- Penalties against heavy emitters, rewards for clean fuel users
- Revenue directed towards IMO Net-Zero Fund
This would be a groundbreaking shift in the decarbonization of the maritime sector, with environmental policies affecting the investment choices of the fleet, fuel supply chains, and trade competitiveness across the globe in the event of its implementation. Washington may, however, oppose this, thereby compelling shipping companies that serve the US ports to prepare a divergent compliance regime to bring in more operational and legal complexity in major trade lanes, and may have a disintegrative effect.