Article 6 Paris Agreement

Article 6 of the Paris Agreement governs voluntary international cooperation between Parties in achieving their Nationally Determined Contributions (NDCs). It is structured around three operational paragraphs:

• Article 6.2 establishes a decentralized framework allowing Parties to engage in bilateral or plurilateral trades of Internationally Transferred Mitigation Outcomes (ITMOs). Switzerland, for example, has signed ITMO agreements with countries including Peru, Ghana, and Thailand.
• Article 6.4 creates a centralized, UN-supervised crediting mechanism—often informally called the Paris Agreement Crediting Mechanism (PACM)—overseen by a Supervisory Body. It is intended to succeed the Kyoto Protocol's Clean Development Mechanism.
• Article 6.8 provides a framework for non-market approaches, covering cooperation through finance, technology transfer, and capacity-building without the exchange of credits.

The rulebook for Article 6 proved one of the most contentious elements of Paris implementation. Core rules were not agreed until COP26 in Glasgow (2021), where Parties adopted decisions addressing long-disputed issues such as avoiding double counting through corresponding adjustments, the carry-over of pre-2020 Kyoto credits, and a share of proceeds for adaptation finance. Further operational guidance on methodologies and the treatment of removals was adopted at COP29 in Baku (2024).

Key technical concepts include:

• Corresponding adjustments: when a host country transfers an ITMO, it must add the corresponding emissions back to its own inventory so the reduction is counted only once.
• Overall Mitigation in Global Emissions (OMGE): a portion of Article 6.4 credits is cancelled rather than transferred, to ensure cooperation produces a net atmospheric benefit.
• Share of Proceeds (SOP): a levy on Article 6.4 transactions channeled to the Adaptation Fund.

For negotiators, Article 6 is significant because it links climate ambition to financial flows: well-designed cooperation can lower the global cost of mitigation, but weak accounting risks inflating reported progress without real emission reductions.