What owners, operators and charterers need to know this year — carbon intensity ratings, the first year of full EU ETS coverage, FuelEU limits and where the IMO's global framework stands.
Shipping now operates under several overlapping climate regimes: the IMO's global energy-efficiency and carbon-intensity rules, and — for voyages to and from Europe — the EU Emissions Trading System and FuelEU Maritime. A further global regime, the IMO Net-Zero Framework, has been approved but not yet adopted. This overview sets out where each stands as of October 2026 and what it means in practice.
IMO: EEXI and CII
The MARPOL Annex VI amendments behind both measures entered into force on 1 November 2022, and their requirements have applied since 1 January 2023.
- EEXI (Energy Efficiency Existing Ship Index) is a technical efficiency requirement for ships of 400 GT and above.
- CII (Carbon Intensity Indicator) gives ships of 5,000 GT and above an annual operational rating from A to E. A ship rated D for three consecutive years, or E in a single year, must submit a corrective action plan to reach C or better.
- The required improvement is set against a 2019 reference line and tightens every year. The factors for 2027–2030 were fixed by IMO resolution MEPC.400(83) in April 2025.
| Year | 2023 | 2024 | 2025 | 2026 | 2027 | 2028 | 2029 | 2030 |
|---|---|---|---|---|---|---|---|---|
| Reduction vs 2019 | 5% | 7% | 9% | 11% | 13.625% | 16.25% | 18.875% | 21.5% |
The IMO's review of the CII continues until spring 2028. Data-reporting amendments from the first phase of the review were adopted in 2026 and are expected to enter into force on 1 September 2027.
EU Emissions Trading System (EU ETS)
- Scope: since 1 January 2024, ships of 5,000 GT and above carrying cargo or passengers, regardless of flag.
- Coverage: 100% of emissions on voyages between EU/EEA ports and at berth in EU ports; 50% of emissions on voyages that start or end outside the EU. Calls at designated neighbouring transhipment ports — Tanger Med and East Port Said — do not count as the start or end of a voyage for container ships.
- Phase-in: companies surrendered allowances for 40% of their 2024 emissions in 2025 and for 70% of 2025 emissions in 2026. 2026 is the first year of full coverage: allowances for 100% of 2026 emissions are due by 30 September 2027.
- Gases: methane and nitrous oxide are covered from 2026, alongside CO2.
- Next steps: offshore ships of 5,000 GT and above join the system in 2027. In July 2026 the European Commission proposed bringing general cargo and offshore ships of 400–5,000 GT into the ETS from 2031; the proposal is not yet law.
FuelEU Maritime
- Scope: since 1 January 2025, ships above 5,000 GT calling at EU ports, regardless of flag, with the same 100% / 50% voyage coverage as the ETS.
- Limits: the greenhouse-gas intensity of the energy used on board must fall against a reference value of 91.16 gCO2e/MJ — by 2% from 2025, 6% from 2030, 14.5% from 2035, 31% from 2040, 62% from 2045 and 80% from 2050.
- Flexibility and penalties: compliance surpluses can be banked or pooled between ships. A shortfall costs EUR 2,400 per tonne of VLSFO-equivalent energy, rising by 10% for each consecutive year of deficit.
- Shore power: from 1 January 2030, container and passenger ships must connect to onshore power supply, or use zero-emission technology, at berth in the main EU ports.
The IMO Net-Zero Framework
In April 2025 the IMO's Marine Environment Protection Committee (MEPC 83) approved a new chapter of MARPOL Annex VI for ocean-going ships over 5,000 GT, which emit about 85% of international shipping's CO2. It combines a global fuel standard — a well-to-wake limit on the greenhouse-gas intensity of fuel — with a pricing mechanism: ships above the limit buy remedial units, ships below it earn surplus units, and the revenue goes to an IMO Net-Zero Fund. The approved draft sets base and direct-compliance targets for 2028–2040 against a 2008 baseline, with initial remedial unit prices of USD 100 and USD 380 per tonne of CO2-equivalent.
The framework is not yet adopted. At an extraordinary session in October 2025, member states voted to adjourn the adoption decision for a year. MEPC 84 (April–May 2026) set up an intersessional working group, and the resumed session is scheduled for 4 December 2026, subject to confirmation at MEPC 85 (30 November – 3 December 2026). Member states may still propose amendments to the draft. If it is adopted, it would enter into force about 16 months later under the tacit acceptance procedure.
Emission control areas
The Mediterranean has been a sulphur emission control area since 1 May 2025, with a 0.10% limit on fuel sulphur content. In 2026 the IMO also adopted a North-East Atlantic emission control area; its amendments enter into force on 1 September 2027 and the area takes effect 12 months later.
What it means in practice
- Charter parties: agree who buys and surrenders ETS allowances and who bears FuelEU compliance. BIMCO publishes standard ETS and FuelEU clauses, including an ETS clause adopted in 2026 for bareboat charters.
- Sale and purchase: CII ratings, EEXI compliance and verified emissions data now feature in due diligence, and the new SALEFORM 2025 includes ETS and FuelEU clauses for sale contracts.
- Valuation and employment: fuel efficiency and carbon-intensity ratings increasingly influence a ship's earnings, its charter prospects and its value.
- Data quality: MRV and IMO DCS reports are the basis of every measure — accurate fuel and voyage records save money.
- Watch December 2026: the outcome of the IMO session will shape fuel and investment decisions for the next decade.
Our chartering and valuation teams factor these rules into every fixture and appraisal. Talk to our chartering desk.