IMO Net-Zero Framework: FMC Oversight And Shipping Act Implications For U.S. Maritime Trade

The International Maritime Organization's (IMO) proposed Net-Zero Framework (NZF) represents an ambitious international effort to decarbonize the maritime sector. The initiative establishes a target of achieving net-zero greenhouse gas (GHG) emissions from international shipping by or around 2050. The NZF is the first in the world to combine mandatory emissions limits and GHG pricing across an entire industry sector. For example, under the proposed system, fleets failing to meet the base target would pay Tier 2 penalties set at $380 per tonne of carbon dioxide (CO₂) equivalent, while those meeting the base target but not the more ambitious direct compliance target would pay a Tier 1 price of $100 per tonne of CO₂ equivalent. Depending on their design, fuel mandates could affect supply chains and shipping costs. Stakeholders have noted that such effects may raise questions under the Shipping Act's prohibition on unjust and unreasonable practices affecting U.S. commerce.