akar.earthArticle 6.2 vs Article 6.4
Article 6.2 vs Article 6.4 of the Paris Agreement: bilateral ITMO deals versus the UN crediting mechanism, and what each means for Indonesia.
Article 6.2 is a bilateral route: two or more countries agree a cooperative approach and transfer internationally transferred mitigation outcomes (ITMOs), applying corresponding adjustments, under rules they largely set themselves. Article 6.4 is a centralised UN crediting mechanism, the Paris Agreement Crediting Mechanism, where a Supervisory Body approves methodologies and a UN registry issues A6.4ERs. For an Indonesian forest or land project, 6.2 suits government-to-government deals such as the JCM with Japan, while 6.4 suits projects wanting a UN-issued unit with standardised rules.
Side-by-side comparison
| Attribute | Article 6.2 | Article 6.4 |
|---|---|---|
| Nature | Decentralised cooperative approaches between Parties | Centralised UN crediting mechanism (PACM) |
| Governance | Participating countries, with UNFCCC reporting and technical expert review | Supervisory Body under the CMA |
| Unit | ITMO (can be based on any credited or non-credited outcome) | A6.4ER (authorised) or mitigation contribution A6.4ER (unauthorised) |
| Methodology rules | Set by the participating Parties or the standard they choose | Approved by the Supervisory Body |
| Authorisation | Required by host country for every transfer | Required for authorised A6.4ERs; host approval for activities |
| Corresponding adjustment | Always for authorised ITMOs | For authorised A6.4ERs only |
| Share of proceeds | No mandatory share for adaptation (encouraged) | 5% of issued units to the Adaptation Fund plus a monetary levy |
| Overall mitigation | Encouraged, not mandatory | 2% of issued units cancelled for overall mitigation in global emissions |
| Registry | National registries and international tracking | The mechanism registry run by the UNFCCC secretariat |
| Indonesia examples | JCM with Japan; other bilateral arrangements | Possible transition of CDM activities; new projects as rules mature |
Key differences
Who writes the rules. Under 6.2 the countries decide what counts, which methodology applies and how to price. That flexibility lets deals move fast but means quality varies by agreement. Under 6.4 the Supervisory Body sets standards for baselines, additionality, leakage, removals and permanence, so units are more uniform but the process is slower. See Article 6.2 ITMOs and the Article 6.4 mechanism.
Built-in contributions. 6.4 takes a share of proceeds for adaptation and cancels a portion for overall mitigation. 6.2 encourages but does not require this.
Authorisation and accounting. Both depend on host-country authorisation letters for internationally used units. Once Indonesia authorises a transfer, it must apply a corresponding adjustment, meaning those tonnes no longer count toward its own NDC. That is why Indonesia is selective about authorising forestry outcomes linked to its FOLU Net Sink 2030 target.
Land-use methodologies. Removals and forestry methodologies under 6.4 have taken time to develop because of permanence and reversal rules. Check the Supervisory Body’s current standards before you plan a 6.4 land project.
When each fits in Indonesia and Southeast Asia
- Government-to-government deals: 6.2. Indonesia’s JCM with Japan is the established example; other bilateral approaches are possible.
- Project developers seeking a UN-issued unit: 6.4, once methodologies covering the activity are approved and Indonesia approves participation.
- Voluntary buyers seeking adjusted units: either route can deliver authorised units; CORSIA demand relies on authorisation. See CORSIA eligible units.
- Domestic rules: Perpres 110/2025 is the legal anchor for carbon trading, including transfers abroad; check implementing rules for authorisation steps. Units for exchange trading must be recorded in SRUK. See mutual recognition arrangements.
- Elsewhere in SEA: Singapore, Thailand and others have signed 6.2 agreements; terms differ by country pair.
Cost and effort considerations
We do not quote fees or prices. Effort drivers:
- 6.2: negotiating with government counterparts, meeting the agreed methodology, and securing authorisation and adjustment commitments.
- 6.4: UN registration fees and share of proceeds, Supervisory Body procedures, validation by accredited bodies, and longer timelines.
- Both: robust MRV that the host government trusts. Data that maps cleanly to national inventory categories reduces friction. Our carbon strategy service helps choose a route.
Questions to ask before you choose
- Is there an existing bilateral agreement covering your activity? If so, 6.2 may be the shortest route.
- Does an approved 6.4 methodology cover your project type? Land-use coverage under 6.4 is still developing.
- Will Indonesia authorise the transfer? Without authorisation, neither route delivers adjusted units.
Common misconceptions
- “6.4 is just the new CDM.” It inherits some CDM features but adds authorisation, corresponding adjustments, share of proceeds and overall mitigation.
- “6.2 units are lower quality.” Quality depends on the approach agreed; some 6.2 deals reference high-integrity standards.
- “Voluntary credits are banned under Article 6.” Voluntary credits continue; Article 6 adds options for adjusted units.
- “Authorisation is automatic once a project registers.” It is a separate government decision.
More in the Article 6 hub and the guide to compliance vs voluntary markets.
Frequently asked questions
What is the main difference between Article 6.2 and 6.4?
Article 6.2 lets countries cooperate bilaterally and transfer ITMOs under rules they agree themselves, with UN reporting and review. Article 6.4 creates a centralised UN crediting mechanism with a Supervisory Body, approved methodologies and a UN registry.
Do both require corresponding adjustments?
Authorised transfers under both do. Under 6.2 every ITMO used toward another country's NDC or other international purposes needs a corresponding adjustment. Under 6.4, only authorised A6.4ERs carry adjustments; unauthorised mitigation contribution units do not.
Is the Japan–Indonesia JCM an Article 6.2 approach?
The Joint Crediting Mechanism is a bilateral cooperative approach, which Japan and partner countries operate in line with Article 6.2. Check current Indonesian implementing rules for authorisation and adjustments.
Can voluntary-market buyers use Article 6 credits?
Yes. Companies can buy authorised units, including for CORSIA, or unauthorised 6.4 mitigation contribution units for contribution-style claims. The claim allowed depends on authorisation status.