On September 10, 2025, the Commodity Futures Trading Commission (CFTC) issued a brief statement announcing the withdrawal of its previously issued guidance regarding the listing of voluntary carbon credit (VCC) derivative contracts that was finalized and approved in September 2024.
The CFTC explained the withdrawal of its previously issued guidance is intended to avoid confusion and inconsistencies in light of existing regulations applicable to listing VCC derivatives and stated the CFTC’s current view that the guidance placed a “disproportionate focus on VCC derivative contracts.”
As Wilson Sonsini noted in our previous client alert, the now-withdrawn guidance was narrowly focused on listing requirements of VCC derivatives by “designated contract markets” and “swap execution facilities” regulated by the CFTC. The withdrawal of the guidance has no direct impact on over-the-counter derivative and cash market transactions that form the great majority of contracts for the issuance and purchase of VCCs by technology enterprises.
The proposed and final guidance offer extensive discussion and nuanced analysis of the conditions, products, and transactions characteristic of the voluntary carbon markets. This information remains available to market participants and is suggestive of practices that would align with a potential broader and more comprehensive regulatory framework for voluntary carbon derivatives. Former Commissioner Kristin Johnson highlighted this potential framework, which the CFTC may consider if it elects to shift its focus again in the future.
