IMO backs Dominguez as 4 December vote decides shipping's carbon bill

The IMO Council backed Secretary-General Arsenio Dominguez for a second four-year term on 4 November. His mandate would run from 1 January 2028 to 31 December 2031, subject to approval by the IMO Assembly in late 2027¹. Council chair Victor Jimenez announced the decision at the Council's 138th session in London¹.

The endorsement keeps the organisation's leadership settled while its flagship climate rule is still unadopted². Member states failed to adopt the Net-Zero Framework in October 2025. Delegates adjourned the extraordinary Marine Environment Protection Committee session for a year, after the United States and oil-producing countries opposed its emissions pricing². A special session to consider adoption is provisionally scheduled for 4 December².

The rule that is still waiting

The framework secured initial approval in April 2025². It would set common global targets for the carbon intensity of marine fuels and collect fees on emissions above those targets, raising $10-15 billion a year, according to Transport & Environment⁶. A ship that meets the targets pays nothing⁶.

Under the draft, the carbon price is $100 per tonne of CO2 equivalent, and the rules cover ships above 5,000 gross tonnage, which account for 85% of shipping's emissions³. The pricing has two tiers: operators that miss the easier targets buy more expensive units than operators that miss only the harder ones³. Revenue goes to an IMO Net-Zero Fund for climate-vulnerable countries³.

The fund is the sticking point. Seatrade Maritime News reported that a Net Zero Fund administered by the UN body remains the point of impasse a month before the vote⁷. Japan has proposed removing the fund in favour of industry-led "direct contributions" and wider use of surplus units, which Opportunity Green said would let companies pay to pollute instead of invest⁸. Fuel treatment, including LNG and biofuels, is also unresolved and still runs through the framework's reward mechanism and lifecycle guidelines⁹.

What it means per shipment

The framework prices fuel, not containers³. The draft sets no per-box rate, so the cost of a shipment depends on how much fuel the ship burns and how much cargo it carries.

Transport & Environment's own example shows the scale. For a ship on the Tema to Algeciras route emitting 1,080 tonnes of CO2 equivalent, the EU ETS would charge for 41% of those emissions in 2030. The IMO framework would charge no more than 23%, and only 9% of the total would be liable under both⁶. Those percentages are estimates from a campaign group, not IMO figures.

ZERO44, which sells compliance software to shipowners, said the framework could add a global carbon price from 2029 if it is adopted in December. That would sit on top of rising allowance prices and FuelEU targets that tighten every five years¹⁰.

The European rules it would sit on

The EU ETS has covered large ships calling at EU ports since January 2024, and FuelEU Maritime has applied since January 2025¹¹. The EU reports emissions on all routes to and from its ports but charges for 50% of them⁶. Shipping produces around 10% of emissions covered by the EU ETS but pays almost 20% of the bill, because it has never received free allowances, European Shipowners said¹².

Brussels has proposed changes to reduce the overlap. The Commission says a ship will not pay twice for the same emissions if the IMO sets a global price⁶. It has floated "ETS as a service" so trading partners can raise revenue on their own 50% share⁶. It would also set aside around 100 million euros a year for decarbonisation in small island developing states and least developed countries⁶. Transport & Environment puts the overlap at around 15% of relevant emissions⁶.

If the vote fails again

The EU's own review is already moving. FEPORT, the European port federation, said policymakers are weighing three anti-evasion options. They are allowances that fall with distance sailed, exemptions for exposed EU ports, and a cargo-based discount for transhipment containers not destined for the EU market¹³.

Carriers and brokers would keep pricing carbon deal by deal. "Whatever the IMO decides in December, a broker will price a dry bulk trip the next morning," Argyris Zafeiropoulos of Resilience & Compliance Advisory wrote. "The vote changes which line of that fixture carries the carbon, and how much"¹⁴.

Politics may also have shifted. Democrats won control of the House and the Senate in the 3 November midterms, and climate groups said that could soften Washington's opposition at the IMO⁴. That is an expectation, not an outcome.

What to watch, 23 November to 4 December

Technical talks resume on 23 November^9, 4. MEPC 85 runs from 30 November, with draft amendments incorporating the framework on its agenda⁵. The resumed extraordinary session on 4 December is due to consider adoption⁵. Watch three things: whether the Net-Zero Fund survives⁷, whether surplus units become the main compliance route⁸, and how LNG and biofuels are treated⁹.

Dominguez said after the Council decision: "I remain committed to following your guidance and contributing to our collective efforts in support of global shipping and seafarers"¹. The mandate is settled. The carbon bill is not.