Dilemmas and Exits: Compliance Risks and Future Paths for Land-Based Emission Reduction Projects in China

Abstract

Between 2024 and 2025, Chinese land-based emission reduction projects frequently faced quality reviews and sanctions from Verra, a leading international standards-setting body. In addition to project stagnation and the withdrawal of carbon credits, China’s reputation as a host country in international efforts to reduce carbon emissions was severely damaged. These cases stem from a deeper social phenomenon: non-state actors like Verra have acquired rule-making power, and exercising this power has substantial implications for other entities, manifesting in the carbon emissions reduction field as tensions over the interests and reputations of project proponents and related parties. With non-state actors breaking the previous monopoly on rule-making power held solely by state actors, creating a “dualistic” confrontation, coordinating the relationship between the two becomes crucial, as promoting positive interaction becomes crucial. Otherwise, the dilemma of “compliant domestically, non-compliant internationally” and “international standards being difficult to implement domestically” will arise, as seen in these cases. This study used two cases of sanctions imposed by Verra on Chinese land-related projects as starting points. Then, taking China’s independent development of a methodology for silt-retention dam carbon sink projects to mitigate international sanctions as a third case. Following a research approach of “case analysis, in-depth investigation of bottlenecks, overcoming difficulties,” this study systematically examines the shortcomings and necessary efforts of both sides by exploring the various problems arising from the clash and conflict of rules between non-state actors and state actors. To address this issue, this study constructs a nested theoretical framework comprising two two-tiered theoretical structures. This study argues that both Verra and the government of China should work together to promote the legitimacy of emission reduction project standards and their effectiveness within host countries. The solutions proposed in this study can also provide experience and a reference for developing countries in addressing the expansion of power by non-state actors and the disconnect between domestic rules.

1. Introduction

Within the global legal framework for addressing climate change, nature-based solutions, particularly agriculture, forestry, and other land use (AFOLU) projects, are widely considered the most cost-effective implementation path to achieving the Paris Agreement’s two-degree Celsius temperature control target [1]. However, as the process of carbon emission reduction deepens and the global voluntary carbon market (VCM) expands, international disputes over the quality and the amounts of emission reduction projects are increasing, becoming a key variable affecting the normal and effective operation of the global carbon market. West et al. (2023) noted that many global forest carbon offset projects have not achieved their claimed emission reductions, and there is widespread overestimation of carbon sinks [2]. This study raised serious questions in the international community about the credibility of third-party verification bodies. Subsequently, audits of large-scale regenerative agriculture and nature-based solutions (NbS) projects in Australia and other countries also confirmed that even in mature markets, the actual carbon sequestration gains from vegetation restoration are often significantly overestimated [3]. As a result of the chain reaction caused by this crisis of trust, between 2024 and 2025, Verra, the world’s largest emissions reduction project construction and carbon credit issuance agency, launched a large-scale review of multiple afforestation and agricultural emissions reduction projects in China, resulting in more than 10 million tons of certified carbon credits (VCUs) being stalled or withdrawn [4]. This upheaval not only demonstrates the doubts of international standards organizations about the authenticity of host-country law enforcement but also, in essence, involves a deep-seated contradiction between the standards of international standards organizations and the land management systems of sovereign states. In other words, it was a struggle for “rule-making power” between international standards organizations and sovereign states.

The operation of the global voluntary carbon market relies heavily on the self-construction of project “compliance.” For land-related projects, compliance not only requires meeting the methodological standards for emission-reduction accounting, but also demands that the project itself have a legitimate legal status within the host country’s legal system, generally including clear land ownership and compliant development procedures [5,6]. However, in practice, there is often a nested dilemma: international standards bodies often set “additional standards” in their internal standards that are independent of the host country’s domestic legislation, requiring land project developers to provide supporting documentation that exceeds the requirements of regular domestic regulatory agencies. Regarding China’s land-based emission reduction projects, a paradox emerges: compliant domestically, non-compliant internationally [7]. Specifically, due to the complexity of China’s domestic land control system and the fragmented, multi-headed approval process, in most cases rejected by Verra, even though the land-based emissions reduction projects had obtained domestic administrative approvals, Verra and other organizations still deemed them unable to meet their internal requirements for transparency and certainty. This problem led to the projects being labeled as “quality-flawed” by international standards bodies. Consequently, land-based emissions reduction projects could not be traded smoothly in the global voluntary carbon market, leading to a broader international trust crisis. The root cause of this “quality flaw” lies largely in the friction and credibility costs arising from the gap between the relevant standards set by international organizations and the host country’s land management system. However, these costs are inappropriately shifted to enterprises and farmers who do not have the power to make rules. These organizations do not have the direct power to make domestic or international rules. The consequences of institutional friction between international and domestic rule-making bodies are concentrated on these entities, which may damage the expected emission-reduction benefits for project owners, undermine their enthusiasm, and affect collective action across society to achieve the goal of climate and environmental governance [8,9]. The non-state actors such as Verra have acquired the power to set rules in the international arena. This power was originally held solely by state actors; the emergence of multiple entities capable of setting rules and standards has led to clashes and conflicts between these rules. These conflicts manifest across various sectors worldwide. This paper focuses on China’s land-based emission-reduction projects as a specific subject, aiming to examine and address this issue.

The existing literature largely focuses on improving the mechanisms of carbon trading markets or updating project methodologies at the technical level [10,11]. However, few studies have delved into the power conflicts between international organization rules and host state public law oversight from a legal perspective, and their negative impact on land management practices. In fact, institutions like Verra represent a typical non-state, market-driven (NSMD) governance model, whose power base does not derive from sovereign-state authorization but rather from the “legitimacy” granted by market access and institutional credibility [12,13]. When such transnational private standards permeate host countries’ land management practices, a lack of legitimacy often triggers significant negative feedback. Existing research indicates that the legitimacy of an international governance system typically needs to be comprehensively assessed from three dimensions: input legitimacy (i.e., the degree of participation and transparency in procedures), output legitimacy (i.e., the efficiency of substantive resolution of governance issues), and throughput legitimacy (i.e., the fairness and accountability of internal administrative processes) [14,15]. These negative feedbacks stemming from power conflicts and rule clashes within the NSMD primarily manifest in the following: First, compliance issues arising from the iterative rule updates by non-state actors such as Verra. For instance, the transition from the old CDM methodology to the more stringent VCS, lacking a smooth transition mechanism, raises questions about how to complete the rule transition and updates while ensuring compliance with the objectives, processes, and effects. Currently, Verra’s approach shifts compliance costs entirely to vulnerable groups, such as project proponents and farmers, making it impossible for Verra to guarantee full legitimacy due to limited objectives, opaque processes, and disproportionate measures. Second, international organizations, through “punitive reviews,” have imposed severe penalties on Chinese emission-reduction projects, systematically undermining China’s credibility as the host country and severely dampening the enthusiasm of Chinese land-based project proponents to participate in international environmental governance. Although Verra enjoys regulatory power as a non-state actor, the implementation and enforcement of its rules still rely on state actors. When the two are incompatible, international standards cannot be fully implemented domestically. In addition to Verra’s lack of legitimacy, a major reason for the rule conflict is the two-tiered disconnect between central and local governments, and between local governments and enterprises, in China. Therefore, it is also necessary for state actors to make adjustments and optimize the domestic policy system.

This study aims to assess the international compliance dilemmas currently faced by China’s AFOLU projects, focusing on answering the following questions: Why are projects that comply with domestic law considered non-compliant in the international context? How does the lack of a “reasonable transition procedure” during the transition between old and new rules undermine the long-term stability of emission reduction activities? Based on this, this paper takes China’s innovative “Yudiba Dam Carbon Sequestration Methodology” (CCER-14-005-V01 [16]) as an example to explore China’s efforts to break the asymmetry between its domestic and international standards, as well as the remaining shortcomings and deficiencies. Through this interdisciplinary perspective, this study not only provides pathways to address the compliance exit of China’s emission reduction projects but also offers a governance model for other developing countries to address the impact of private environmental standards within their sovereign borders. This paper develops a theoretical framework to categorize rule conflicts between Verra and China. It uses a nested, two-layered, mutually beneficial, interactive framework to address the compliance dilemmas faced by China’s AFOLU projects. This dual-layer theoretical framework forms two logical closed loops based on “co-governance”. Whether it is “external co-governance”, which is the mutual movement between non-state actors such as Vera and state actors such as China, or “internal co-governance”, which is the mutual coordination between “central-local” and “local-carbon emission reduction project proponent,” both can help solve the problems of connection between old and new rules, and transition between international and domestic rules. This framework can also be applied to developing countries facing conflicts between transnational private governance and domestic law, providing theoretical support for optimizing domestic governance and aligning it with international rules.

2. Theoretical Framework and Research Methods

2.1. Theoretical Framework

This article provides an in-depth analysis of Verra’s typical sanctions against Chinese land-related projects. In discussing the compliance dilemmas faced by Chinese land-related emission reduction projects, this article constructs a nested, two-layered theoretical framework. This theory argues that as non-state actors gradually penetrate the realm of international rule-making, they are breaking the previously dominant role of state actors, creating a “co-governance” situation between non-state and state actors. Especially in specialized fields or areas where unified standards are difficult to establish across different countries, such as the high-quality emission-reduction project standards discussed in this article, how should non-state actors and state actors optimize regulatory models and build coordination and connection mechanisms to form a positive interactive relationship? A positive interactive relationship would allow both non-state and state actors to formulate better and implement legitimate, effective international rules.

This theoretical framework consists of two layers, each representing a unidirectional effort by one side to align with the other. The two layers ultimately merge into a single layer, forming an ideal interactive logic. Specifically, the first layer argues that the legitimacy of non-state actors should be enhanced after they participate in international governance. This paper draws upon Vivien Schmidt’s (2013) input-process-output legitimacy analysis framework for the European Union but does not apply it directly [17]. Instead, it develops and modifies it by considering the realities of carbon emission reduction, the characteristics of international standards bodies such as Verra, and the status of China’s emission reduction projects [17]. Verra’s criteria for determining the legitimacy of non-state actors are expanded to include three aspects: goal legitimacy, process legitimacy, and effect legitimacy. Only when all three stages meet the legitimacy criteria can the fully legitimate status of non-state actors like Verra be guaranteed. The second layer involves state actors aligning themselves with legitimate international standards established by non-state actors. Alignment requires state actors to ensure the domestic implementation and compliance with international rules. Achieving this prerequisite necessitates addressing domestic obstacles and optimizing domestic policies. In cases involving sanctions against China’s land-based emission reduction projects, we found rule-breaking at the two levels of “central-local” and “local-project owner (enterprise)” in China, forming a small double-layer structure within the nested theoretical framework. These two breaks hinder the channel for the domestic implementation of international rules, causing Verra’s standards to be separated from Chinese laws and regulations. Ultimately, this has led China’s land-based emission-reduction projects into a situation in which they are compliant domestically but non-compliant internationally, resulting in severe penalties from Verra.

The theoretical framework developed in this paper can effectively promote the formation of a “co-governance” arrangement between non-state and state actors. Under this dual-layer theoretical framework, both non-state actors, such as Verra, and host countries of carbon-emission-reduction projects, such as China, can work together from their respective perspectives to address issues related to the alignment of international and domestic rules and the domestic application of international standards. This paper refers to this as the “external co-governance” closed-loop system. In addition, at the level of state actors, there is a nested “internal co-governance” closed-loop system, consisting of “central-local co-governance” and “local-carbon emission reduction project proponent co-governance”. Only by making joint efforts both externally and internally can the ideal goals of positive international-domestic interaction and effective implementation of international standards at the domestic level be achieved.

Overall, the theoretical framework and research idea are shown in Figure 1.

2.2. Research Methods

This paper primarily employs a normative analysis-based approach to legal research, supplemented by case studies and theoretical analysis. Therefore, it presents a legal research paradigm centered on textual interpretation and normative analysis.

2.2.1. Theoretical Research Methodology

This paper proposes a two-layered, nested theoretical framework for coordination and interaction. In this framework, non-state actors need to broaden the scope of legitimacy determination, considering the legitimacy of objectives, processes, and outcomes as all factors. State actors, on the other hand, need to improve their domestic policy systems, which in China primarily manifests as a small, fragmented relationship between the central and local governments, and between local governments and enterprises. This framework, with its large two-layered structure nested within smaller two-layered structures, can effectively address the current predicament and promote a virtuous cycle of interaction between different rules.

2.2.2. Normative Analysis

This paper employs normative analysis to examine in depth the normative conflicts between international institutional standards and China’s land management laws and administrative approval system. It innovatively expands the scope of determining the legitimacy of international institutional standards, focusing on the legal legitimacy and boundaries of non-state actors such as Verra exercising substantive review and rule-making powers. Furthermore, by comparing Verra’s methodology with that of China’s silt-retention dam carbon sequestration projects and by contrasting Verra’s internal requirements for reviewing emission-reduction projects with China’s domestic review norms, it reveals the inherent institutional friction arising from nested rules.

2.2.3. Case-Study Analysis

This paper selects real cases of large-scale sanctions imposed by Verra on AFOLU-type projects in multiple locations in China in 2025 and 2024 as the starting point for research. It details the categories of Chinese projects sanctioned by Verra, the carbon credits involved, and the basis for Verra’s sanctions, providing a solid case foundation and support for the theoretical analysis that follows. These cases were selected for the following reasons: first, they occurred recently, clearly demonstrating the current focus of international standards bodies such as Verra and the shortcomings of Chinese emission-reduction projects. Second, the impact was wide-ranging; these two cases affected as many as 86 land-based emission-reduction projects in China, rendering a large number of issued and unissued carbon credits invalid. Third, the cases sparked widespread controversy. Since the two parties involved were Verra, a highly influential international body that sets standards for emission-reduction projects, and China, the world’s largest developing country, as the host country, the dispute over project quality has generated widespread debate in the international community. The focus of the controversy has also expanded to include various aspects, such as the limits of sanctions, Verra’s authority, and project quality supervision, making these cases both typical and exemplary. Furthermore, this paper uses China’s “silt-retention dam carbon sink” project as the third case study, while considering the paper’s overall logical structure and the potential progressive relationship among the cases. It is precisely because of repeated international sanctions that China has considered developing its own project methodology, and this case study allows for a comprehensive and objective analysis of the advantages and disadvantages of China’s silt-retention dam carbon-sink project methodology.

3. Compliance Dilemmas Faced by China’s Land-Based Emission-Reduction Projects Amid Conflicts Between Rules by Non-State Actors and State Actors

3.1. At the Non-State Actor Level: Verra Imposed Sanctions on China’s Emissions Reduction Projects Based on Its Internal Requirements

3.1.1. Case 1: The Verra “Nested Doll” Compliance Dilemma Faced by Chinese Land-Related Projects

On 12 December 2025, Verra issued a notice on its official website stating that it had questioned the authenticity of government approval documents for emission reduction projects in AFOLU1, in which China was the host country. Based on the aforementioned concerns, Verra rejected four related projects from China (see Projects in deepest blue, Appendix A 

Table A1. List of Chinese projects sanctioned by Verra (due to issues with the authenticity of the approval). In the table, the dark blue items show the projects that were rejected by Verra, the medium blue items show the projects for which Verra has suspended the issuance of carbon units, and the lightest blue items show the projects for which Verra has decided to cancel the issuance of carbon units.

Num.	Project Name	Num.	Project Name
1847	Qianxinan Afforestation Project in Guizhou Province	1895	Jilin Linjiang Afforestation Project
1864	Puzhen Afforestation Project in Guizhou Province	1896	Hunan Northern and Northwestern Area Afforestation Project
1865	Xiguan Afforestation Project in Guizhou Province	1935	Hubei Hongshan IFM Project
2070	Guinan Afforestation Project	2249	Henan Fangcheng and Tanghe Afforestation Project
1332	Reforestation Project in Yingjing County, Sichuan Province	2326	Guangxi Jinxiu IFM Project
1361	Reforestation Project in Qinghai Province 2012	2327	Guangxi Huanjiang IFM Project
1529	Inner Mongolia Chao’er Improved Forest Management Project	2343	Zhanjiang Mangrove Afforestation Project
1542	Yunnan Kunming Liangqu Improved Forest Management Project	2370	Zhangye City Afforestation Project in Gansu Province
1577	Fujian Yong’an Improved Forest Management Project	2375	Jilin Sanchazi Afforestation Project
1664	Yunnan Xishuangbanna Improved Forest Management Project	2391	Gansu Tianshui Afforestation Project
1715	Inner Mongolia Wu’erqihan IFM Project	2405	Gansu Dingxi Afforestation Project
1718	Inner Mongolia Keyihe IFMProject	2413	Zhangjiakou Zhangbei County 2017 Afforestation Project
1825	Afforestation Project in Xining City	2418	Gansu Lanzhou Afforestation Project
1826	Qinghai Afforestation Project	2451	Shanxi Loufan Afforestation Project
1832	Haidong Afforestation Project	1855	Hechu Afforestation Project in Anhui Province
1855	Hechu Afforestation Project in Anhui Province	1930	Henan Nanzhao Afforestation Project
1930	Henan Nanzhao Afforestation Project	2082	Qianbei Afforestation Project
2082	Qianbei Afforestation Project	2083	Liangdu Afforestation Project
2083	Liangdu Afforestation Project	2087	Chudu Afforestation Project
2087	Chudu Afforestation Project	2310	Anhuang Afforestation Project
2310	Anhuang Afforestation Project	2378	Miaoling Afforestation Project
2378	Miaoling Afforestation Project	2379	Huadu Afforestation Project
2379	Huadu Afforestation Project	2387	Liugui Afforestation Project
2387	Liugui Afforestation Project	2652	Hehan Yiyang Afforestation Project
1866	Xinjiang Makit County Afforestation Carbon Sequestration Project

) [4]. Verra pointed out that all emissions reduction projects registered under Verra’s VCS are required to comply with local laws. However, the authorized validation/verification bodies (VBs) for the four Chinese emissions reduction projects mentioned earlier could not determine whether these projects had received approval from the relevant Chinese authorities, nor could they verify the legality and authenticity of the supporting documents submitted by the project proponent, Guizhou Baiheng Fertilizer Co., Ltd. Therefore, after conducting quality control reviews (QCRs) on these projects, Verra rejected them [4]. Given Verra’s compliance with host-country laws, these emissions-reduction projects may be deemed to violate Chinese domestic laws and regulations. As a penalty, Verra required the project initiators to replace the 4.42 million VCUs already issued for these four projects and to cancel their contributions to the buffer pool. Taking this opportunity, Verra planned to continue reviewing 45 other agricultural, forestry, and other land-use projects in China. For 35 of these projects, Verra required its authorized verification bodies to contact the relevant Chinese government authorities to confirm the existence and validity of approvals, and to decide whether to reject the applications or require the projects to replace their verified carbon units based on the confirmation results. During the review period, the issuance of new carbon units will be suspended. (See Projects in the middle blue, Appendix A Table A1) For the remaining 10 similar Chinese emissions-reduction projects, Verra has decided to withdraw the 7.1 million verified carbon units already issued for these projects and has also suspended the qualifications of the relevant authorized verification bodies. (See Projects in Lightest blue of Appendix A Table A1).

3.1.2. Case Study 2: The Verra “Iterative” Compliance Dilemma Faced by Chinese Land Projects

In August 2024, Verra took another significant action against voluntary carbon projects in China, rejecting 37 rice cultivation projects that used the old Clean Development Mechanism (CDM) methodology AMS-III.AU, arguing that the methodology was outdated (see

Table 1. List of Chinese projects sanctioned by Verra (Chinese Rice Cultivation Projects rejected by Verra, due to outdated methodologies).

Num.	Project Name	Num.	Project Name
2362	Adjusted Water Management in Rice Cultivation in Tongcheng City	2771	Futong Adjusted Water Management in Rice Cultivation
2396	Adjusted Water Management in Rice Cultivation in Nanling County	2845	QiDa Adjusted Water Management in Rice Cultivation
2397	Adjusted Water Management in Rice Cultivation in Chizhou City	2850	Chishui Adjusted Water Management in Rice Cultivation
2398	Qiantai Adjusted Water Management in Rice Cultivation	2851	Xihuai Adjusted Water Management in Rice Cultivation
2399	Adjusted Water Management in Rice Cultivation in Wangjiang County and Susong County	2853	Yufeng Adjusted Water Management in Rice Cultivation
2476	Huaining Adjusted Water Management in Rice Cultivation	2854	Hongmei Adjusted Water Management in Rice Cultivation
2477	Wanfan Adjusted Water Management in Rice Cultivation	2855	Zhengtongsui Adjusted Water Management in Rice Cultivation
2504	Adjusted Water Management in Rice Cultivation in Xuanzhou District	2856	Wudao Adjusted Water Management in Rice Cultivation
2506	Adjusted Water Management in Rice Cultivation In Northern Lujiang County	2891	Adjusted Water Management in Rice Cultivation In Jiangxia District
2507	Adjusted Water Management in Rice Cultivation In Southern Lujiang County	2892	Adjusted Water Management in Rice Cultivation In Wuxue City
2629	Adjusted Water Management in Rice Cultivation in South Jiangjin District	2894	Adjusted Water Management in Rice Cultivation In Xinzhou District
2630	Adjusted Water Management in Rice Cultivation in Yongchuan District	2899	Adjusted Water Management in Rice Cultivation In Dawu County
2631	Adjusted Water Management in Rice Cultivation in Dazu District	2902	Adjusted Water Management in Rice Cultivation In Huangmei County
2632	Adjusted Water Management in Rice Cultivation in Eastern Hechuan District	2903	Adjusted Water Management in Rice Cultivation In Xiaochang County
2633	Adjusted Water Management in Rice Cultivation in Nanchuan District	2909	Adjusted Water Management in Rice Cultivation In Yingcheng City
2634	Adjusted Water Management in Rice Cultivation in Tongnan District	2910	Wude Adjusted Water Management in Rice Cultivation
2769	Adjusted Water Management in Rice Cultivation in Pinghu City	2911	Adjusted Water Management in Rice Cultivation in Haiyan County
2770	Yulin Adjusted Water Management in Rice Cultivation	2912	Adjusted Water Management in Rice Cultivation in Tongxiang City

). According to Verra’s official announcement in 2024, the inadequate methodologies for these rice cultivation projects resulted in problems such as insufficient additionality justification, undersized projects, exaggerated project areas, and insufficient evidence to confirm the implementation of baselines and project scenarios. Based on this, Verra imposed sanctions on these Chinese project proponents, requiring them to compensate for the excess VCUs issued and to submit additional compliant VCUs to fill carbon credit gaps that Verra believes may have been over-issued. According to statistics, 37 projects have been registered under Verra using the old methodology, of which 25 projects have issued a total of 4.56 million VCUs, accounting for 0.43% of all issued VCUs. According to statistics, 37 projects have been registered under the Verra project based on the old methodology, of which 25 projects have issued a total of 4.56 million VCUs, accounting for 0.43% of all issued VCUs [18]. The sanctions mean that, according to Verra’s sanctions, project proponents will not only have to bear the various losses caused by the suspension of the project itself but also incur huge economic costs to make up for the carbon credits. Furthermore, Verra had issued non-conformity reports to four relevant verification/certification bodies (VVBs): China Classification Society Certification Co., Ltd., China Quality Certification Center, Shenzhen Huace International Certification Co., Ltd., and TÜV Nord Cert GmbH. Verra required these four verification/certification bodies to submit a valid corrective plan within 15 days to rectify the problems found in their project audits; otherwise, their qualification to review agricultural, forestry, and other land use (AFOLU) projects under the VCS will be temporarily suspended. Verra had explicitly stated that the severity of this series of punitive measures is “unprecedented.” Verra’s Chief Program Management Officer, Farhan Ahmed, also believes this decision is based on serious issues discovered during quality control reviews and that these project proponents are paying the price.

Specifically, all sanctioned projects adopted the Kyoto Protocol CDM methodology AMS-III.AU.: VCS program’s version 4.0 for reducing methane emissions by adjusting water management practices in rice cultivation. In March 2023, Verra decided to permanently discontinue the use of this methodology in the VCS program and stated that it had initiated research and development of a new methodology for rice methane emissions, hoping to improve the international credibility and verifiability of rice cultivation projects and support the generation of high-quality VCUs. However, it should be noted that these sanctioned Chinese rice cultivation projects were all registered before Verra stopped using the CDM project methodology. Furthermore, as of 27 February 2025, Verra officially released the updated Verified Carbon Standard (VCS) methodology for rice projects, Methodology VM0051: Improved Management in Rice Production Systems (v1.0). The time interval between withdrawing the old methodology and developing the new one was quite long, and Verra’s severe sanctions against Chinese rice cultivation projects also occurred before the new methodology was released [19]. It can be said that during the rule gap before the handover between the old and new rules, Verra did not make any clear arrangements for the transition and conversion procedures of rice cultivation projects that had already been registered and continued to receive carbon credits under the old methodology.

However, in practice, more moderate approaches exist. Non-state actors of equivalent standing to Verra, such as Gold Standard and Paris Agreement Article 6.4, which establishes the Paris Agreement Crediting Mechanism (PACM), have chosen a phased approach to upgrade their project methodologies. In December 2025, The Gold Standard held a final consultation on its methodology for Joined-Up Sustainable Transition (JUST): Coal Decommissioning. During this methodological transition process, the Gold Standard advocated for fairness and inclusiveness for all stakeholders. Therefore, it is through multiple consultations and feedback collection that Gold Standard completed a moderate upgrade that ensured effective participation from all stakeholders [20].

Additionally, the process for the transition of CDM activities to the Article 6.4 mechanism is also worth considering. First, the rules for this transition process are very clear and comprehensive, providing a transparent and complete transition process and guidance for project owners using the old methodology. Second, project proponents need to initiate the transition process independently by submitting an application, allowing for a thorough assessment. Finally, the UNFCCC secretariat allows sufficient time for project proponents to complete the transition [21]. The methodology for updating is undoubtedly sound; however, adopting a more gradual approach—one that accommodates the interests of stakeholders—might be preferable.

3.2. State Actor Level: Domestic Measures Taken by China to Avoid Sanctions from International Standards Bodies

In the two cases mentioned above, Verra’s sanctions dealt a significant blow to Chinese agricultural, forestry, and other land use (AFOLU) projects. The reason is that Verra wields considerable influence in the international voluntary carbon reduction market. Established in 2005, this standards body for project registration and carbon credit issuance has grown into the world’s largest carbon crediting registry. Agricultural, forestry, and other land-use projects are the main categories regulated by Verra. Therefore, Verra’s sanctions against specific projects, especially those in the agricultural, forestry, and other land-use sectors, which are its regulatory focus, can have a substantial impact on these projects, their proponents, investors, other stakeholders, and even the host country.

In the aforementioned case of Verra reviewing the domestic approval validity of Chinese agricultural, forestry, and other land use projects, the fact that the project proponents of the four rejected projects were all Guizhou Baiheng Fertilizer Co., Ltd. means that any emission reduction project with Guizhou Baiheng Fertilizer as the project owner will automatically become a focus of attention and review. Furthermore, the review will likely extend beyond Verra to other international carbon credit standardization agencies and even carbon credit buyers in the carbon trading market, influenced by Verra’s international reach. Even if these emission-reduction projects regain eligibility for carbon credit issuance after revision, under the same trading conditions, carbon credit buyers are highly unlikely to prioritize Chinese agricultural, forestry, and other land-use projects, especially those with Guizhou Baiheng Fertilizer as the project owner. Secondly, Verra’s review will also affect Guizhou and its surrounding areas, and even similar projects throughout China will face frequent reviews or an international trust crisis. In the methodological case study of the 2024 Chinese rice variety project, the project proponents included companies from Hubei Province, Guizhou Province, Chongqing Municipality, Zhejiang Province, and Anhui Province, broadening the scope and increasing the trust risks faced by China as the host country for emissions reduction projects. Finally, because Verra ordered the suspension of carbon credit issuance for Chinese emissions reduction projects that under review and were found to have quality defects, withdrew already issued certified carbon credits, and provided additional carbon credits of equal value from the compensation pool that met the standards, the impact of Verra’s negative review results would extend beyond the credibility domain, directly causing substantial economic losses to project owners, investors, and all stakeholders.

Therefore, regardless of the reasons, the “naming” and selection of Chinese agricultural, forestry, and other land-use projects for quality review and the identification of quality issues are detrimental to project owners, stakeholders, host countries, and other stakeholders. In the short term, this will result in significant economic losses. In the medium term, it will diminish residents’ livelihoods, employment, and economic resources in the project locations, hindering sustainable economic development and potentially disproportionately impacting low-income groups. In the long term, China’s international credibility as a host country for emissions reduction projects will decline, significantly impacting the effectiveness, trading value, and demand for carbon credits in the international market. China needs to start with land-related projects, improve domestic regulations, accelerate alignment with international standards, and ultimately work with entities like Verra to establish a positive, interactive regulator ultimately.

In practice, China has begun developing its own innovative project methodology, a beneficial attempt to align with international standards. One such methodology is the “Methodology for Voluntary Greenhouse Gas Emission Reduction Projects: Yudiba Dam Carbon Sequestration (CCER-14-005-V01),” released on 2 December 2025, by the Ministry of Ecology and Environment and the Ministry of Water Resources of the People’s Republic of China. This methodology endows Yudiba dam projects—long-standing engineering measures for controlling soil erosion and achieving soil and water conservation in the Loess Plateau region—with the capacity to create tradable carbon sequestration [22]. As shown in Figure 2, Yudiba dams are water and soil conservation gully management projects built in the main, tributary, and minor gullies of the Loess Plateau to control erosion, retain floodwater and silt, create farmland, and reduce sediment entering the Yellow River. They consist of the dam body, water release structures, flood discharge structures, and related supporting projects. The topography and climate of the Loess Plateau make this region prone to soil erosion, exposing and decomposing large amounts of organic carbon stored in the soil and sediment. Yudiba dams can conserve soil and carbon by intercepting eroded sediment in gullies and preserving the organic carbon carried by the sediment; reduce erosion and emissions by minimizing the mineralization and decomposition of lost organic carbon during erosion and transportation; and enhance the carbon sequestration capacity of the dammed soil and its plants by providing favorable conditions for crop and other plant growth. These measures play a vital role in promoting ecological environmental protection and sustainable development in the Yellow River Basin [16]. Building on this foundation, the Chinese government’s elevation of silt-retention dam projects to forestry and other carbon sink-related emission reduction projects capable of generating China Certified Emission Reductions (CCERs) is a key measure based on the country’s realities and aimed at developing innovative projects. In the ecological restoration of mining areas, engineering construction inherently requires intercepting erosion materials; utilizing this deposition process to calculate carbon sinks will give restoration projects a new role in creating economic value [23]. The positive significance of this project lies in, on the one hand, it attracts investment for local governments to construct silt-retention dams and provides stable funding through carbon credit trading, thereby solving the long-standing financial difficulties faced by silt-retention dam projects, such as high construction costs and complex operations and maintenance. On the other hand, it creates opportunities to improve the surrounding environment and raise residents’ living standards.

However, it must be acknowledged that developing a methodology for silt-retention dam carbon sequestration projects is only the first step. To ensure that the China Certified Emission Reductions (CCERs) generated by silt-retention dam projects represent genuine, additional emission reductions, gain international recognition, and thus exert their credit-offering effect on a larger scale, the quality and level of the project methodology design must be guaranteed. For example, a complete carbon accounting framework needs to be established for the carbon sequestration process of silt-retention dams, including the construction of baseline scenarios, the quantification of project scenarios, the monitoring of sedimentation volume and organic carbon content, the modeling of sequestration stability, and ultimately, the emission reductions from projects that meet specific quality requirements should enter the domestic and even international carbon markets in the form of China Certified Voluntary Emission Reductions (CCERs) [16]. After careful analysis of published methodologies for silt-retention dam carbon sequestration projects, we found that, despite China’s efforts, there are still shortcomings in project design and rule-setting that hinder alignment with international and domestic standards. Furthermore, due to issues such as poor rule implementation and transmission between the central and local governments and between local governments and enterprises, even if China has formulated rules or introduced and adopted international standards, these rules may not necessarily be followed and applied by specific project owners, and international review and sanctions may still be unavoidable.

4. An Analysis of the Underlying Reasons for the Compliance Dilemma of Land-Based Emission-Reduction Projects in China Based on a Nested Two-Level Theoretical Framework

4.1. Theoretical Level 1: Comprehensive Legitimacy Assessment of Non-State Actors

As the most influential international standards body in the global voluntary carbon market, Verra effectively shapes and governs the rules for voluntary emissions reduction projects through its methodological design, project review procedures, and carbon credit issuance mechanism. This power not only affects the “fate” of projects in China, the host country, but also directly shapes the development and direction of the global carbon credit market. However, because Verra’s power does not originate from state actors and lacks a corresponding oversight mechanism, it is not inherently legitimate. It must rely on continuous optimization of its own mechanisms to ensure the governance process and outcomes [17]. The compliance dilemmas faced by China’s land-based emissions-reduction projects mentioned earlier also indicate that Verra’s decision-making suffers from poor alignment between international and domestic rules and a disconnect between methodological iteration and practice. In this process, it is inappropriate to attribute responsibility entirely to the quality of the emissions-reduction projects themselves; attention must also be paid to the inherent deficiencies Verra, as a non-state actor, has exposed.

Based on this, this paper draws on Vivien Schmidt’s (2013) input–process–output legitimacy analysis framework for the European Union, but does not apply it directly [17]. Instead, it develops and modifies it by combining the realities of carbon emission reduction, the characteristics of international standards bodies such as Verra, and the status of emission reduction projects in China. The criteria for determining Verra’s legitimacy as a non-state actor are expanded to three aspects: objective legitimacy, process legitimacy, and effect legitimacy. Firstly, target legitimacy concerns whether Verra’s objectives and value basis meet the requirements of full participation and recognition by all stakeholders, i.e., whether Verra’s exercise of power deviates from the organization’s original objectives or artificially restricts the objectives that were originally achievable. Secondly, process legitimacy primarily assesses whether Verra’s rule-making, methodological changes, and related review procedures are fair, transparent, and stable. Thirdly, the effect legitimacy mainly concerns whether Verra’s actions have achieved corresponding emission reductions and whether the measures taken and the results achieved are commensurate and proportionate. Examining Verra’s decision-making process in the Chinese case through these three dimensions can reveal its legitimacy deficiencies as a non-state actor and the consequences that follow, laying a theoretical foundation for future improvement of the organization.

4.1.1. Assessment of Verra’s Target Legitimacy

In the three-stage legitimacy assessment framework of “goal–process–effect” constructed in this paper, goal legitimacy is at the most fundamental level, focusing primarily on whether the power sources of non-state actors, their goal-setting, and their exercise are consistent with the core objectives. In its official statement under the 2025 case, Verra stated that the reason for conducting quality reviews and imposing severe penalties on agricultural, forestry, and other land-use projects in China was that the verification/inspection agency could not confirm whether the projects had obtained valid approval from the host government. In other words, these projects did not meet the basic compliance requirements of Verra’s VCS.

However, to determine whether Verra’s claim of “not obtaining valid approval from the host government” is valid, it is necessary to return to China’s current legal and regulatory system, clarifying which projects legally require approval procedures and which projects are not within the scope of approval by reviewing and analyzing specific provisions. In fact, according to current Chinese laws and regulations, such as the “Land Administration Law of the People’s Republic of China” and the “Forest Law of the People’s Republic of China” and their supporting regulations, only changes in the use of agricultural land, forest land, etc., require approval from the relevant national authorities. They do not impose approval obligations on carbon-reduction projects in agriculture, forestry, or other land uses. The following are the relevant regulations in China regarding land-use change approvals (see

Table 2. Relevant regulations in China regarding the approval requirements for changes in land use.

Legislation	Relevant Articles	Key Contents
Land Administration Law	Article 3. Article 4, Paragraph 3. Article 44, Paragraph 1.	The use of land must be strictly in accordance with the purposes set out in the overall land use plan. When agricultural land is converted to construction land, the conversion approval procedures must be completed.
Forest Law	Article 15, Paragraph 1, Paragraph 3. Article 37, Paragraph 1. Article 45.	Owners and users of forests, trees, and forest land shall protect and rationally utilize forests, trees, and forest land in accordance with the law, and shall not illegally change the use of forest land. When organizing afforestation and greening projects, governments at all levels should plan scientifically, adapt to local conditions, optimize the structure of forest types and tree species, and encourage the use of native tree species and improved varieties of trees.
Environmental Impact Assessment Law	Article 7, Paragraph 1, Paragraph 3. Article 8. Article 16, Paragraph 1.	The relevant departments of the State Council, the local people’s governments at or above the prefecture-level city level, and their relevant departments shall, during the planning process of the land use plans, regional, river basin, and sea area construction, development, and utilization plans they organize to compile, organize environmental impact assessments, and compile chapters or explanations on the environmental impact of the plans.

).

After analyzing relevant Chinese laws and regulations, this paper argues that China’s approval requirements for land use and development are primarily based on two considerations: environmental protection and land planning. Land planning approvals mainly aim to protect the proportion of forests and woodlands in the national land area, ensuring that these lands are not unreasonably occupied or developed. Based on this, from both practical and objective perspectives, we can conclude that China’s emission-reduction projects do not fundamentally violate Chinese domestic law. From a practical perspective, this paper uses the emission reduction project rejected by Verra (Project ID 1847) as an example for discussion. According to Verra’s official website, the project aims to reduce greenhouse gas emissions and promote local sustainable development through afforestation. The Forestry Bureaus of Xingren City, Xingyi City, Ceheng County, Zhenfeng County, and Qinglong County jointly implement the project. The project involves directly planting trees on degraded land in the five cities and counties. The afforestation areas were originally barren hills, and there were no plans to reforest them before the emission reduction project was launched. Therefore, the main task of the project is to plant local endemic cypress trees [24]. In short, the “Guizhou Qianxinan Afforestation Project” is an afforestation, reforestation, and vegetation restoration (ARR) project using planting on wasteland. If the project is jointly carried out with municipal and county forestry bureaus, it can be understood that it has already received explicit approval from these government departments, or at least implicit consent. From a purpose perspective, Guizhou Province generally has a backward economy and a high demand for desertification control and for economic development through emission reduction projects. Naturally, it supports projects that combine environmental protection with economic benefits. Many afforestation projects in China rely on the organization and participation of government departments, rather than formal approval documents. It further illustrates that the project is not compliant domestically; the main reason for the Verra sanctions is that Verra’s requirement of “documentary proof” is incompatible with Chinese legal practice.

However, in the actual implementation of this clause, the “compliant domestically, non-compliant internationally” dilemma presented by Chinese projects actually reflects Verra’s expansion of its goal of “complying with host country laws.” The core function of this clause in Verra’s institutional design is to ensure that project development activities have a stable legal basis, avoiding land ownership disputes or other violations of mandatory national regulations. However, Verra’s review of a series of Chinese projects, based on a lack of authentic government documentation, and its subsequent rejection decisions have extended the application of this clause to examine whether the host country’s administrative procedures themselves meet its internal evidentiary requirements and accountability processes. As a result, Verra’s focus as a non-state actor has probably shifted from project quality to other irrelevant or secondary standards. This shift could lead to undue penalties for emission-reduction projects that deliver genuine reductions in emissions. Numerous rejections based on “host country legal requirements” neither reflect the true quality of emission-reduction projects nor prevent the imposition of incorrect or excessive constraints on genuine projects. It would severely dampen project owners’ enthusiasm for emission reductions and, on a larger scale, weaken developing countries’ initiative to utilize their emission-reduction potential to participate in climate governance. Verra’s expanded objectives and spillover power not only undermine its legitimacy as a non-state actor but also sow the seeds of institutional tension between the legitimacy of the process and the legitimacy of the results.

4.1.2. Assessment of Verra’s Process Legitimacy

Process legitimacy focuses on factors such as transparency, stability, fairness, participation, and social impact assessment of the system’s operation. However, considering Verra’s handling of Chinese land-related projects, particularly the discontinuation of the rice-based methane emission reduction project methodology “AMD-III.AU,” the transition arrangements between the old and new methodologies, and the strength of post-project review, there is still room for improvement in its process legality.

Firstly, regarding transparency, in rejecting the Chinese rice cultivation projects and subsequently imposing sanctions, Verra may have engaged in one-on-one communication with the project owner and relevant VVBs, providing them with more detailed technical feedback and rectification requirements [18]. However, based on publicly available information, the transparency of its procedures remains significantly insufficient. On the one hand, Verra’s announcement only summarized its review conclusions with highly generalized statements such as insufficient additional evidence, exaggerated project area, and insufficient baseline evidence, without disclosing the technical details supporting these judgments, methodological applicability assessments, remote sensing analysis logic chains, or specific data comparison results. For third parties not directly involved in the communication, this disclosure model makes it difficult to verify the consistency, proportionality, and scientific validity of Verra’s judgments, or to assess whether its review standards remain fairly applicable across different countries and projects. On the other hand, Verra did not disclose the explanatory materials, supplementary evidence, or corrective statements submitted by the project proponents or VVBs in response to the review comments, leaving the public only exposed to Verra’s one-sided narrative. Even though one-on-one communications may involve a great deal of detail, this asymmetric information disclosure still weakens the possibility of external oversight and negatively impacts the project owners’ image in international public opinion. In addition, while four VVBs faced global or regional suspensions, the announcements did not specify the type, proportion, or severity of their audit errors. This not only affected the reputation of the relevant institutions but also prevented other project owners from learning methodological or operational lessons. Therefore, even though Verra maintained sufficient interaction in internal communication, there is still room for improvement in its transparency from the perspective of institutional governance and market credibility. Increased transparency will help the outside world understand its decision-making logic and enhance the international carbon market’s trust in its discretion.

Secondly, regarding the stability of the rules, although Verra announced the discontinuation of the old methodology in 2023 and released the new methodology “VM0051” in 2025, its transition arrangements and penalty schemes are not consistent. Firstly, there is a time lag between the old and new methodologies. At the same time, Verra required that “all registered and listed VCS projects applying the methodology were placed on hold while Verra was reviewing the methodology,” resulting in projects being forcibly terminated even without violating any existing rules because the new methodology was not yet complete. Secondly, Verra further stated in its subsequent policies that “Registered projects using AMS-III.AU can transition to VM0051 by following the VCS Methodology Change and Requantification Procedure, v4.0,” emphasizing that this transition procedure is “the choice…is voluntary.” However, in the case of the Chinese rice methane emission reduction project, Verra required the project to seek compensation for excess VCUs issued voluntarily. It is clearly inconsistent with the 2024 “VCS Methodology Change and Requantification Procedure,” which explicitly states that “the choice to make such an update is voluntary” and “the total quantity of reductions and removals eligible for issuance…shall not exceed the quantity…previously approved.” In other words, the rules document expresses the principles of “voluntary” and “non-retroactive,” which contradict the “mandatory replacement” and “retroactive liability” adopted in actual implementation, creating a de facto institutional deviation.

Thirdly, regarding public participation, Verra took the harshest action against 4 Chinese rice cultivation projects suspected of questioning the authenticity of their government approvals. However, more impactful was Verra’s use of this as an opportunity to rapidly expand its regulatory scope to another 45 similar projects in China: 35 of these were forced into further quality control reviews, with new carbon credit issuance suspended; another 10 projects even had their 7.1 million carbon credits revoked, and their related VVBs suspended. For these 45 projects, the problem did not stem from their own violations but rather from Verra’s questioning of the first four projects, leading to their collective involvement in the review process. However, based on publicly available information, it remains unknown whether Verra complied with the necessary public participation procedures for the affected project owners in this significant decision—including prior notification, consultation, opportunities to make factual statements, or appeal channels. There has been no public explanation regarding whether the relevant procedures existed, when they were initiated, their scope, or whether the project owner’s opinions were fully considered. This lack of transparent participation mechanisms under significant adverse impact makes it difficult for outsiders to judge whether Verra’s handling meets the requirements of procedural justice.

Finally, regarding social impact assessment, Verra, in releasing its new methodology “VM0051,” specifically emphasized the significant “socio-environmental co-benefits” of rice methane reduction projects, such as “improving farmers’ income” and “increasing women’s access to agricultural training and financial services.” However, in its quality review and sanctions against Chinese rice cultivation projects, Verra failed to assess whether suspending projects and pursuing carbon credits would harm farmers’ incomes or regional social development. It also failed to assess whether these measures would damage farmers’ income, weaken women’s access to training and financial services, or potentially cause collateral damage to the economic and social development of underdeveloped regions. While acknowledging the social benefits of rice cultivation projects, it completely ignored these additional benefits in its enforcement, effectively failing to assess the social impact on vulnerable groups.

In summary, Verra’s implementation of regulations in its land-related projects in China exhibits multiple deficiencies, including insufficient transparency, inconsistent rules, limited participation, and the absence of social impact assessments. These institutional flaws not only exacerbate the predicament of Chinese projects being “compliant domestically, non-compliant internationally,” but also reflect procedural deviations in Verra’s exercise of power, laying deep-seated institutional risks for further misalignment of the legitimacy of subsequent effects.

4.1.3. Assessment of Verra’s Effect Legitimacy

Effect legitimacy assesses whether measures taken by non-state actors are proportionate at the outcome level and whether they balance the exercise of power with the reduction in the burden on regulated entities. However, Verra’s institutional practice in China, particularly in rice cultivation projects, involving the discontinuation of the old methodology AMS-III.AU and subsequent penalties, reveals significant imbalances in the allocation of power and responsibility, the intensity of penalties, and the proportionality of goal achievement.

First, Verra’s power and responsibility structure is clearly asymmetrical. Considering the roles of Verra and other international standard-setting bodies and project owners, their relationship can essentially be summarized as “management and being managed,” “execution and being executed”—their positions are unequal. Given its dominant position, Verra should assume a guiding role and bear corresponding obligations for the damages resulting from its failure to perform its functions fully. However, while Verra enjoys the power to formulate rules, it also states in its official documents that it “makes no representation, warranty, or guarantee…Verra…will not be liable for any errors…” [25]. In other words, in key stages such as methodology development, review, project suspension, and penalties, Verra retained broad interpretative and executive powers while attempting to absolve itself of responsibility for errors, omissions, or improper execution through disclaimers. It means that once Verra’s judgment is flawed or its execution is defective, the project owner is forced to bear all adverse consequences, even though Verra has already notified the project owner “not to assume any responsibility.”

Secondly, regarding the proportionality between the degree of violation and the severity of penalties, Verra, in its series of penalties against China Rice Cultivation Projects, required emission reduction project proponents to seek compensation for all potentially additional carbon credits issued (seek compensation for excess issuances of Verified Carbon Units), without using the period before or after project suspension as a criterion for compensation, which should have been the core and crucial criterion. Even more concerning, this differs fundamentally from the soft, voluntary transition and recognition criteria in Verra’s “VCS Methodology Change and Requantification Procedure,” issued on 16 October 2024, for both new and existing project methodologies, as well as for already-issued carbon credits [24]. If other transitional methods already exist, requiring Chinese rice cultivation project proponents to invalidate carbon credits issued before the new methodology was implemented—credits that could be deemed excessive emission reductions by Verra at any time—and to resubmit VCUs of equal value may be discriminatory and questionable in its rationale. Actually, adopting overly aggressive sanctions, besides impacting the legitimate rights of vulnerable groups such as farmers and women, could also have a greater negative impact, as these rice cultivation projects are mostly concentrated in less developed countries and regions.

Finally, Verra’s punitive measures lack corresponding remedies, leaving project proponents unable to appeal and thus depriving them of their right to redress when facing significant adverse consequences. Whether requiring projects to “suspend” in stoppage notices or identifying “quality issues” in four VVBs during quality reviews, publicly available materials show that Vera provided no form of objection procedure, hearing opportunity, or appeal process, nor did it establish a remedy mechanism in its methodology or registration process that could be initiated solely by the project sponsors. It is disproportionate to the significant negative impacts it has had on proponents of emission-reduction projects, such as suspending registrations, halting issuance, repossessing issued VCUs, and requiring payment of equivalent carbon credits, exacerbating the imbalance between measures and their effects.

In summary, at the effectiveness level, Verra’s measures for land-based emission-reduction projects in China face problems such as asymmetry between power and responsibility, an imbalance between the degree of illegality and the severity of sanctions, and a lack of appeal mechanisms. The outcome of its system will not only severely damage emission-reduction projects in developing countries but will also deviate from Verra’s core mission of achieving sustainable development and climate action goals, thereby undermining the legitimacy of its own system.

4.2. Theoretical Level Two: Evaluation of the Effectiveness of the Connection Between Small Two-Tier Rules Within State Actors

We construct a “nested two-layer interaction” theoretical framework between non-state actors and state actors. The first layer, starting with international standard-setting bodies such as Verra, aims to achieve legitimacy in terms of objectives, processes, and effects, thereby better aligning with state actors and ensuring the smooth domestic implementation of international rules. However, in practice, efforts from non-state actors alone are insufficient. State actors also face challenges such as inadequate regulation and poor transmission, making it difficult for them to establish cooperative, aligned relationships with international standard-setting bodies. To some extent, internal problems within state actors can even be a significant factor in “international violations” in emission-reduction projects. For example, although China has innovatively developed a methodology for silt-retention dam carbon sequestration projects to address the international crisis of distrust, some provisions of this methodology still do not meet current international standards. In view of this, the second layer of the theoretical framework proposed in this paper specifically focuses on state actors, advocating adjustments and optimizations to domestic policy systems to align domestic policies with high-quality international standards. This part mainly discusses China’s current shortcomings and proposes corresponding solutions based on the typological analysis results.

4.2.1. There Is Still Room for Improvement and Refinement in China’s Emission Reduction Project Standards

In fact, Verra’s requirement that projects registered under the VCS comply with the host country’s laws and regulations is not limited to those directly related to the quality of emission-reduction projects, such as host-country approval. Rather, it is based on broader considerations, and whether these broader considerations relate to project quality or the environmental benefits of the project needs to be determined on a case-by-case basis. Specifically, Verra’s VCS version 5.0, released in December 2025, shows that the host country laws referred to by Verra, in addition to regulations that improve project quality, also cover multiple aspects such as protecting the rights and interests of residents and ensuring the integrity of project rights. Specifically, regarding the rights of residents, Section 3.17, “Stakeholder Engagement,” of the VCS stipulates that if an agricultural, forestry, and land-use project affects the legal or customary rights of Indigenous Proples (IPs) and Local Communities (LCs), these stakeholders must be fully involved in the design and implementation of the project through free, prior, and informed consent (FPIC). The project owner should provide stakeholders with relevant international, national, and local laws regarding human rights, labor rights, Indigenous rights, local community rights, and any other rights, based on their specific circumstances [26]. Verra also requires validation/verification bodies (VBs) to confirm, during project review, that there are no ownership disputes between the project itself and residents.

Regarding other land or resource rights, Section 3.18.17 of the VCS requires that: projects must not encroach on private, stakeholder, or government property; and must not force residents to leave or relocate from the land by means of restricting access to land and resources without consent, proper compensation, and compliance with all applicable international, national, and local laws [25]. Furthermore, Sections 3.18.30 and 3.18.33, respectively, address requirements for emissions-reduction projects related to domestic laws and regulations on anti-corruption and anti-money laundering. These requirements, proposed by Verra based on considerations of project rights integrity and legitimacy, adhere to the host country’s laws and regulations. Building on this, for higher-level project quality requirements such as “Improve Forest Management” (IFM) activities, Verra also hopes to leVerrage national or local regulatory bodies to obtain endorsement from the host country regarding the conservative setting of baselines, the clarification that the land was not originally used for the emissions reduction project (“additionality”), and the “stability” and “long-term nature” of the emissions reductions issued by the project. Therefore, this analysis concludes that Verra’s punitive measures against Chinese projects are primarily based on those projects’ violation of Verra’s own “additional” compliance requirements within its system. It applies whether these projects fail to demonstrate the integrity of their rights or cannot rely on domestic approval procedures to guarantee their “additionality” or “stability,” rather than violating the host country’s “native” legal regulations.

However, under current Chinese regulations, while China has made significant progress in improving the quality of domestic emission-reduction projects, there is still room for improvement in areas such as setting baselines for emission-reduction projects, demonstrating “additionality,” and ensuring that domestic project proponents fulfill their due diligence obligations more fully. This article will again use the methodology of China’s silt-retention dam carbon sink projects as an example. Firstly, it is commendable that China has gradually aligned itself with international standards in areas such as project ownership and national legal endorsement. Specifically, the methodology requires silt-retention dam carbon sink projects to simultaneously meet requirements such as clear land ownership and project emission reduction ownership, project stability, the project owner being the owner of the silt-retention dam property rights or its authorized legal entity, and compliance with national laws, regulations, standards, and industry development policies [16]. Furthermore, the emission-reduction calculation method for silt-retention dam carbon sequestration projects has overcome the shortcomings of baselines set based on artificial simulations, transforming it into a method for calculating the actual amount of carbon removed by the silt-retention dam project. Specifically, the baseline scenario for silt-retention dam carbon sequestration projects is a situation in which, before construction of the silt-retention dam, the land within the project boundary was an erosion gully [27]. Accordingly, the project’s emission reduction equals the project’s cleanup amount minus the baseline cleanup amount and the project’s leakage amount, after deducting the impact of non-persistent risks [16]. Therefore, compared to previous project methodologies, the quality of the silt-retention dam carbon sink project methodology has significantly improved.

However, it is undeniable that the silt-retention dam carbon sink project methodology still requires further adjustment and optimization in some aspects. Currently, there are still significant shortcomings in several areas, including baseline setting, additionality assessment, project leakage calculation, and non-persistent risk deduction, resulting in gaps compared to international standards set by organizations such as Verra. This paper compares and analyzes the silt-retention dam project methodology with similar afforestation, reforestation, and replanting project methodologies under Verra (see

Table 3. A comparison of the methodology of silt-retention dam projects with similar afforestation, reforestation, and replanting projects under Verra.

Category		Sedimentation Dam Carbon Sequestration (CCER-14-005-V01)	VCS Methodology Afforestation, Reforestation, and Revegetation (ARR) (VM0047)
Baseline setting	Relevant Articles	Article 6.1 and 6.4	Article 6.2 Census-based Approach
	Content differences	Adopts a relatively direct discrimination approach, the core of which lies in identifying the original damaged state of the land before construction: Baseline scenario identification (6.1) explicitly requires that the land within the project boundary must be an erosion gully before construction of the Yudiba dam. Calculation simplification principle (6.4): Under the baseline scenario, the impacts of the carbon pool and emission sources are considered negligible.	Employs a “Census-based Approach,” determining whether the baseline is zero by setting specific physical thresholds: Quantification Method (6.2): Using the “Project Method” to set the credit baseline. Dual admission criteria: Vegetation threshold: The original woody biomass cover of the project area must be less than 10%. Land history: The land must be continuously cultivated or fall under the land use category “settlement” or “other land.” Result determination: Only when both of the above criteria are met can it be assumed that no forest and grassland restoration will occur without project intervention, thus setting the baseline to 0.
Additionality argument	Relevant Articles	Article 6.2	Article 7.2 Census-based Approach: Article 7.3.4 Common Practice
	Content differences	Exempt from argumentation	Project proponents must conduct rigorous triple justification: regulatory surplus, investment analysis, and Common Practice analysis.
Project leak calculation	Relevant Articles	Article 6.6	Article 8.4 Leakage Emissions Article 4.2 In the area-based quantification approach
	Content differences	It is assumed that the project implementation will not result in any transfer of agricultural or pastoral activities in the region; therefore, the leakage amount is set directly to 0.	Census method: If the project can maintain the existing level of agricultural production and avoid land-use conversion, the leakage effect can be assumed to be minimal (de minimis). Area method: This must not be ignored; monitoring and quantification must be performed using tools such as VMD0054.
Non-persistent risk deduction	Relevant Articles	Article 7.1	Article 8.5.1 Area-based Quantification of Uncertainty Article 8.5.2 Census-based Quantification of Uncertainty
	Content differences	Given the risks of flooding, earthquakes, and erosion gully damage on the Loess Plateau, a “non-persistent risk deduction rate” is established. This deduction rate is determined by accounting for historical dam failure rates, with a default value of 1%.	Area method: Assumes zero uncertainty in geographic boundaries and performance baselines, but standard methods must be used to estimate the uncertainty of carbon pool changes. Census method: Assumes zero uncertainty in population size and baselines; uncertainty is primarily calculated through error propagation when estimating carbon pool changes.

). The comparison clearly reveals that China’s silt-retention dam carbon sink project methodology is overly vague and lacks clear principles in the aforementioned aspects, failing to provide clear calculation formulas and methods. Under such circumstances, it may be difficult to accurately determine the additionality of silt-retention dam projects in the international community, necessitating further refinement and improvement. It shows that when national-level emission-reduction project rules are still inadequate and in need of improvement, the aforementioned problems may become more pronounced when these rules are transmitted and delegated to the local level. There are generally large differences in geography and policies across regions in China, and the ability of local governments to interpret, implement, and refine the rules also varies. To a certain extent, it can be understood that the less clear and complete the rules are, the greater the discretion of local governments. That is why the quality of emission-reduction projects in some regions is frequently subject to international review and institutional sanctions, such as in Guizhou Province, which is one subject of the case study.

4.2.2. China Still Needs to Strengthen Supervision of Project Owners’ Compliance with and Implementation of International Standards

In the case of Verra’s sanctions against Chinese emission-reduction projects, a key basis for the sanctions was that the projects failed to comply with the agency’s arrangements and to promptly suspend and update their project methodologies. Therefore, China needed to bear responsibility for the negative consequences of continuing to apply the old methodologies. This article argues that the criteria for determining whether project proponents should bear responsibility and to what extent should include both objective and subjective aspects. The objective aspect includes verifying the quality of emission reduction projects and whether actual harmful consequences, such as damage to environmental integrity, obstruction of emission reduction work, or exaggeration of emission reduction effects, have occurred. The main regulatory and management authority lies with international standards organizations such as Verra, and a reasonable judgment must be made by balancing principles of proportionality and transparency. Conversely, the subjective aspect involves whether the continued application of the old methodologies was malicious, such as project proponents” having the right to do it but deliberately not doing it” or “knowing it but feigning ignorance.” This problem can be partly attributed to insufficient supervision by the host country or the local governments of domestic enterprises. In the case of rice cultivation projects in China, it can be reasonably inferred that some Chinese project proponents and verification/verification agencies had a subjective intent of “knowing but feigning ignorance,” and that there was an objective result of a certain degree of over-issuance of carbon credits under the new methodology standards. It is because Verra issued a notice in 2023 to discontinue the use of the old Clean Development Mechanism (CDM) methodology “AMS-III.AU,” explicitly stating that the discontinuation was based on identified problems, including insufficient guidance on field stratification, a lack of accounting and monitoring of nitrous oxide (N₂O) emissions and changes in soil organic carbon storage, and a lack of standardized measurement guidelines for methane emissions. Verra also initiated a review of projects registered under the “AMS-III.AU” methodology of the Clean Development Mechanism (CDM), requiring the cessation of registration, operations, and carbon credit issuance for these projects during the review [28]. Although not every project received a “one-on-one reminder,” based on experience and practice, relevant emission-reduction projects in all countries, including those in China, should pay close attention to Verra’s announcements and respond accordingly. A major reason for this issue is that China has not yet achieved refined management and full-process supervision of domestic project proponents. In the implementation and application of rules between “international—domestic—enterprise (project owner),” the effectiveness and importance of the rules are weakened. It is partly due to the poor transmission of rules between the central and local governments, and partly due to insufficient supervision and oversight between “local governments and enterprises.”

Firstly, regarding the central and local governments, this paper summarizes and concludes China’s relevant provisions on compliance with standards other than mandatory national laws. It allows us to glean insights into and infer China’s attitude towards the application of international standards, including Verra, to domestic project proponents and other stakeholders, and to determine whether existing laws and regulations can promote and guarantee the domestic implementation of Verra international standards. This paper lists the main domestic rules, which are presented in the following clauses (see

Table 4. The main domestic rules are specifically the following clauses.

Legislation and Regulations	Relevant Articles	Key Contents
Civil Code	Article 10	Civil disputes shall be handled in accordance with the law; where the law does not provide, custom may be applied, but it shall not violate public order and good morals.
Law on the Application of Laws to Foreign-related Civil Relations	Article 4 Article 5	Where the laws of the People’s Republic of China contain mandatory provisions regarding foreign-related civil relations, those mandatory provisions shall apply directly.
Civil Procedure Law	Article 271	Where an international treaty concluded or acceded to by the People’s Republic of China contains provisions different from those of this Law, the provisions of that international treaty shall apply, except for those provisions to which the People’s Republic of China has made reservations.
Interpretation of the Supreme People’s Court on Several Issues Concerning the Application of International Treaties and International Customs in the Trial of Foreign-Related Civil and Commercial Cases	Article 1	Where international treaties contain provisions that differ from those of the laws of the People’s Republic of China, the provisions of the international treaties shall apply, except for those provisions on which the People’s Republic of China has made reservations.
Standardization Law	Article 2 Article 18	Mandatory standards must be implemented. The state encourages the adoption of recommended standards. The state encourages academic societies, associations, chambers of commerce, federations, industry technology alliances, and other social organizations to coordinate with relevant market entities to formulate group standards that meet market and innovation needs jointly. The development of group standards should adhere to the principles of openness, transparency, and fairness.

).

Based on the analysis of the aforementioned Chinese laws and regulations, China’s position on the order of application of domestic and international law can be summarized as follows: when matters involving national sovereignty, national security, public interest, or those subject to mandatory domestic provisions or public order reservations exist, domestic law takes precedence; when other matters are involved, and domestic law has not yet made provisions, or when there is a conflict between domestic and international law, international law takes precedence. However, international law here usually refers only to international treaties, primarily the United Nations Framework Convention on Climate Change and the Paris Agreement in the environmental field. Whether it includes the internal requirements of international carbon credit standard-setting organizations, such as Verra, remains unclear. This article argues that a specific determination should be made based on the conflicting matters and the status of the disputing parties. Therefore, when the national level lacks or fully regulates the domestic application of standards set by non-state actors such as Verra, local governments find it difficult to carry out such work without the guidance of nationally unified rules.

Secondly, regarding the relationship between “local government and enterprise (project owner),” this article will again use the emission reduction project in Qianxinan Prefecture, Guizhou Province, as an example for discussion. It is because emission-reduction projects in China are mainly located in relatively underdeveloped regions with low urbanization levels, such as Guizhou. However, this is not unique to China; it is a common practice worldwide. On the one hand, these regions meet the geographical and ecological conditions for large-scale emission-reduction projects; on the other hand, establishing such projects can also create economic value for local communities and boost residents’ incomes. A tender document for a comprehensive rocky desertification control and biodiversity conservation project in Qianxinan and eastern Wumeng Mountains of Guizhou Province shows that the qualification review of project proponents mainly focuses on the validity of business licenses, whether there are any credit risks such as bankruptcy or breach of contract, the project manager’s years of relevant work experience, and whether they possess the corresponding professional titles and independent legal person status. It does not stipulate whether the company understands, masters, and complies with international standards, whether it has a record of sanctions by relevant international organizations, or whether the rectification results are recognized [29]. Even during the CDM era, there were complaints about falsified Project Design Documents (PDDs) for the Yanhe, Dejiang, and Yinjiang Rural Methane Digesters Project in Guizhou Province, China [30]. Verra’s selection of the Guizhou emissions reduction project for review is somewhat related to previous complaints. We believe that maximizing the benefits of emissions-reduction projects requires recognition from international standards bodies. Lifting the international influence of these bodies allows carbon credits issued under these projects to fetch higher prices in the international carbon trading market. However, China has not paid sufficient attention to accelerating the international recognition of its domestic projects.

The Chinese government should attach great importance to the introduction and application of international standards such as Verra, especially for highly specialized work such as carbon emission reduction, which is mainly carried out at the international level. Analyzing international efforts to reduce carbon emissions, the scale and complexity of this work are enormous. Because it involves the national interests and needs of countries at different stages of development, the roles and functions of non-environmental factors such as politics and economics are easily exaggerated. Therefore, it is difficult for a single country to effectively carry out this work while maintaining an objective and impartial stance and fully considering the needs of different countries. It requires the assistance of neutral or non-profit international organizations or specialized international institutions to facilitate cooperation and coordination among countries, as well as to unify the regulation and management of highly specialized tasks. This process represents a gradual consolidation of power by non-state actors. Therefore, it can be further inferred that when sovereign states participate in and ratify international environmental conventions, they can be seen, to some extent, as relinquishing some of their regulatory power to relevant organizations and institutions within the international convention system for unified management and action. Thus, except for a few specific clauses that fundamentally conflict with a state’s interests, these clauses should automatically take effect on contracting parties or other participating entities unless explicitly objected to by a state. It reflects the trust and authority that sovereign states place in international organizations to protect universal human interests, such as global climate change. Usman Ullah Khan (2023) argues that international organizations play an irreplaceable and crucial role in addressing global environmental issues, responding to the concerns and questions of various stakeholders, formulating global norms in specific areas, and coordinating international crisis responses [31].

However, it is important to note that even if Chinese emission reduction projects and their proponents have issues, both subjective and objective, it is still necessary to assess whether Verra’s penalties are excessive and whether they violate issues of target suitability, process transparency, and the proportionality of effects. Only when Verra and the relevant Chinese authorities work together can a positive, interactive relationship be established.

5. Policy Implications

Based on the nested, two-tiered interaction framework between non-state actors and state actors proposed in this paper, achieving a perfect fit between the two requires the following two aspects: First, non-state actors must meet broader legitimacy standards, such as goal achievement, process transparency, and maximization of effects. Second, state actors should continuously optimize their domestic policy systems. Besides adjusting substantive rules, procedural rules, such as promoting the implementation and application of international standards domestically, are equally important. When non-state actors and state actors “share” the power to formulate international rules, maintaining a fragmented situation of “going it alone” and “each forming their own faction” will inevitably lead to conflict. Only through mutual tolerance can both sides move in the same direction, cooperate, and jointly advance international goals for reducing carbon emissions.

5.1. International Standards Bodies Should Meet Legitimacy Requirements in a Broader Sense

Verra has room for improvement in terms of the legitimacy of its objectives, processes, and effects. It needs continuous reform in governance philosophy, institutional procedures, and the allocation of responsibilities to respond to the global market’s expectations for fairness, transparency, and stability.

First, international standards bodies should clarify their dual role as both “rule-makers” and “technical guides.” In future standard-setting and methodological updates, Verra should focus on two key issues: ensuring environmental integrity through strict rules, and ensuring the feasibility, effectiveness, and sustainability of emission reduction projects under realistic conditions. Ignoring differences in project implementation capabilities and merely raising the bar to “improve carbon credit quality” will inevitably lead to market shrinkage, project suspensions, and decreased participation from the Global South, ultimately weakening Verra’s authority and influence as a major international standards-setting body. In fact, global project proponents have already voiced objections to the legitimacy of international standards bodies and their standards, but these objections are not limited to Verra. In May 2025, with the launch of the Paris Agreement Crediting Mechanism (PACM) under Article 6.4, stricter baselines and leakage calculation rules were set [32]. However, this move has also sparked resistance from proponents of emissions-reduction projects, such as regenerative agriculture and nature-based solutions (NbS). For example, Climate Farmers, a major European regenerative agriculture organization, announced its withdrawal from the carbon market, claiming that the current stringent standards for emissions-reduction projects are “out of touch with reality” [33]. It is evident that, for international standards bodies, properly balancing the relationship between “quality improvement” and “project feasibility” while maintaining reasonable governance limits is crucial to enhancing their legitimacy.

Secondly, international standards bodies must strictly control the boundaries of their power to ensure that objectives and means are proportionate. In China’s land-based emissions reduction projects, Verra interpreted “compliance with host country laws” as a strict review of the form and authenticity of local government approval documents, effectively deviating from the original purpose of the clause: “ensuring the stability of the project’s rights base.” A similar overreaching of objectives is also evident in China’s rice cultivation projects, where Verra required project proponents to make up for potentially over-issued carbon credits. This requirement not only violates the principle of proportionality but may also undermine the trust of host country governments and project proponents in international standards bodies. Therefore, Verra should clarify the boundaries of its institutional power and strictly adhere to the principle of proportionality. An independent, impartial, and operational accountability system could be considered, such as establishing an independent appeals committee and external oversight mechanisms, enabling project proponents to obtain remedies when faced with excessive penalties. Simultaneously, the scope of exemption clauses should be considered to be limited, and Verra should bear responsibility for obvious procedural errors or excessive enforcement.

Finally, Verra needs to significantly improve the transparency of its governance process, public participation, and social impact assessments. In cases of methodological discontinuation, project suspension, or quality review, Verra typically provides only general explanations, such as “quality issues,” and fails to disclose, or only partially discloses, specific deficiencies in parameters, models, and monitoring procedures. It makes it difficult for project proponents to understand their key shortcomings and specific flaws. Furthermore, Chinese projects lack participation channels during the sanctions process, with no opportunity for representation or appeal. This one-way governance approach not only reduces the transparency of Verra’s governance procedures but also undermines the legitimacy of its implementation. Therefore, Verra needs to establish a system of public disclosure, stakeholder hearings, and mechanisms for public participation regarding methodological updates. Simultaneously, given the significant social benefits of many emissions-reduction projects, such as increased smallholder income, greater women’s participation, and ecological restoration, Verra should incorporate social impact assessments into its review process. For example, an Earth.Org article points out that PACM’s high thresholds, set by nature, may exclude regenerative agriculture projects with significant emissions-reduction potential, which often improve local community well-being [32]. Verra should avoid neglecting social impacts while improving environmental integrity, and push emission reduction projects that could benefit vulnerable groups to the margins of the market.

5.2. China Should Enhance Its Vigilance Against Rule Changes and Strengthen Its Supervision of Domestic Project Proponents

In a situation of co-governance by non-state actors and state actors, to avoid damage to China’s national interests and the rights and reputation of domestic project proponents during rule conflicts and iterations, and to ensure that China’s emission reduction projects and their results gain international recognition, maximizing the interests of project proponents and all relevant parties, China needs to continuously adjust and improve its domestic policies in light of the international and domestic situation. This paper argues that China may take the following measures: (1) As the host country, it should have sufficient sensitivity to changes in international rules and the ability to apply them domestically; (2) As a sovereign state, it can deeply participate in the formulation and updating of relevant standards and play an important role in the transformation of international standards organizations.

Firstly, the host country should have strong policy sensitivity and vigilance, obtain information and policies in a timely and smooth manner, and feed back the information to the project proponents to ensure that the project proponents and projects can apply and adapt to the new policies and rules. It is because the host country and domestic project proponents constitute a community of shared interests, and emission-reduction projects are always at the forefront of international advanced standards, which also helps the host country establish a good international image. J. Lou (2022) also conducted an econometric analysis of the positive impact of emission reduction project synergies on host countries [34]. They pointed out that synergies from climate actions, such as emission-reduction projects, empowering women, improving farmers’ livelihoods, and creating local jobs, are generally considered to deliver more direct and broader sustainable benefits than carbon benefits because they are more specific. Moreover, carbon credits issued by emission-reduction projects with greater potential synergies sell for an average of 30.4% more in the carbon trading market than those issued by projects with low synergies [34].

Secondly, the host country inherently possesses management advantages and regulatory flexibility for its domestic emission-reduction projects. It is evident in various aspects, including policy change notifications, project compliance reviews, and penalties for violations. Furthermore, domestic authorities hold greater authority over project proponents than international organizations, thereby ensuring greater consistency and dynamic coordination between domestic emission-reduction projects and international standards. In fact, statistical analysis of the two Chinese land-related project cases discussed in this paper reveals that the project proponents subject to investigation or sanctions are mostly concentrated among specific enterprises, particularly in Guizhou province. A significant reason for this is likely the inadequate oversight by relevant Guizhou authorities of the tracking and monitoring of local emission reduction projects. Jingyuan Xu and Yue Zhang (2022), through analysis of extensive CDM project data, concluded that host country governments can mitigate the potential negative consequences of project construction through strengthened regulation, innovative technologies, flexible policy formulation and application, and improved climate adaptability [35]. Local governments, in particular, play a more significant role than the central government. Therefore, within the large two-layer theoretical framework proposed in this paper, a smaller two-layer framework is nested, focusing on the lack of smooth coordination among central and local governments, and between local governments and enterprises, in China. This part also addresses these issues, enabling state actors to better connect with non-state actors such as Verra.

Finally, China also needs to participate deeply in the formulation and updating of international standards. On the one hand, understanding and participating in the international standard-setting process is a means of accumulating experience and practice in formulating and revising relevant Chinese laws and regulations. Furthermore, it provides an opportunity to explore and establish mechanisms and platforms for information exchange, policy coordination, and standard connectivity with other countries, international standards organizations, and even proponents of emission-reduction projects in other countries. In 2025, a major reason Chinese agricultural, forestry, and other land-use emission-reduction projects were subject to Verra quality reviews was that Verra could not determine whether the Chinese government had approved the projects. At that time, there was no reliable non-state actor or domestic communication and coordination mechanism to verify the authenticity of these approvals.

5.3. Exploring a Chinese Project Methodology That Balances International High-Quality Standards with Domestic Practices

Against the backdrop of increasingly close international carbon cooperation, the ultimate destination of China’s Certified Emission Reductions (CCERs) generated by domestic emission-reduction projects should not be limited to the domestic carbon market. Still, it should be accepted and recognized by the international community and used to fulfill the international emission reduction responsibilities borne by China and other responsible entities. Moreover, given the frequent quality reviews of land-based emission reduction projects constructed in China in recent years by international standards bodies such as Verra, with less-than-ideal results, greater efforts are needed to rebuild the credibility and trustworthiness of Chinese emission reduction projects and carbon credits in the international community. Therefore, aligning with international standards for project quality in emission reduction is an unavoidable core approach.

Methodological design is crucial to the effective implementation of emission-reduction activities. Some studies suggest that the current crisis of trust in the carbon credit market stems from inherent challenges in its underlying methodology. Whether it is preventing deforestation or developing renewable energy projects, mainstream international mechanisms generally rely on counterfactual virtual baselines to calculate emission reductions. It means predicting the total amount of greenhouse gases that might be emitted without emission reduction projects. This method of prediction and simulation based on hypothetical conditions is inherently arbitrary and overly subjective, which can easily lead to problems such as overly lenient baseline settings [36]. Further research has confirmed that an evaluation of 26 voluntary avoided-deforestation projects across 6 countries on 3 continents revealed that most projects did not significantly reduce deforestation. Even those projects that did achieve tangible results reduced deforestation by a much smaller margin than claimed. The fundamental reason is the large gap between the deforestation baselines set beforehand and the actual deforestation observed afterward, underscoring the urgent need to revise the methodology for setting baselines. Therefore, only by avoiding emission-reduction calculation methods based on prediction and simulation, and by proposing more scientific methods, such as the carbon sequestration methodology of silt-retention dams mentioned earlier, can China hope to escape project quality issues and no longer be identified as having excessive emission reductions. Specifically, China needs to strictly control project design, emission-reduction performance monitoring, and accounting, and to provide appropriate assistance, guidance, or penalties to project proponents who violate or fail to meet these standards.

6. Conclusions

Based on the foregoing analysis, we draw the following conclusions: In the international community, non-state actors such as Verra are increasingly exercising rule-making power, especially in areas with significant public attributes, high levels of expertise, and substantial inter-state disagreements, such as carbon emission reduction. When rules formulated by non-state actors affect the interests of emission-reduction project proponents, relevant parties, and even state actors, they need to exercise their power cautiously and comprehensively assess the potential consequences. Although the starting point of international standards bodies in accelerating the achievement of climate change mitigation targets is not wrong, better results may be achieved if the intensity and scale are controlled. The severe sanctions imposed by Verra on Chinese land-based emission-reduction projects, discussed in the case study, were partly due to methodological lags and difficulties confirming domestic approvals, but were largely motivated by a desire to salvage the international reputation damaged by the shortcomings of Zimbabwean and Brazilian rainforest projects. Therefore, the sanctions were excessively harsh, an attempt to deflect blame for its own regulatory problems, and discriminatory, applying different punishments to emission reduction projects from China and other countries. According to the broader legitimacy criteria constructed in this paper, Vera’s approach, in terms of its objectives, process, and effects, has significant room for improvement. While it may serve as a warning and deterrent, it also represents a final blow to all stakeholders in the sanctioned projects, hindering these entities from correcting their mistakes and promoting long-term sustainable development. It contradicts Verra’s fundamental purpose of supporting the development of emission-reduction projects. However, this paper also argues that state actors need to make changes, primarily by ensuring the smooth domestic implementation of international standards and imposing more comprehensive and adequate supervision on domestic project proponents. Aneesh V. Pillai (2024) argues that domestic rules, grounded in national practices and supported by different levels of competent authorities, can better and more fully implement these international standards [37]. This study constructs a two-tiered theoretical framework to achieve the ideal goal of two types of actors moving towards each other. The purpose of this theoretical framework is to establish two complete “co-governance” systems: one between Vera and the host country of the carbon emission reduction project, China, and the other among stakeholders at different levels within China. Once this “co-governance” framework is established and operates smoothly, the difficulties in applying and implementing international standards discussed in this paper will be readily resolved.

China is the world’s largest developing country and a major host of emission-reduction projects. This study uses the quality review and credibility crisis faced by China’s land-based emission reduction projects at the international level as a case study, aiming to provide broader insights for other developing countries. This study argues that China needs to gradually improve and optimize its domestic emission-reduction project standards and regulatory rules to align them with international standards bodies such as Verra. China’s problems are likely common to many developing countries, and the analytical methods, solutions, and improvement suggestions presented in this study can be referenced and applied to other developing countries. However, this study still has research limitations. Currently, China’s silt-retention dam projects are still in their early stages of development. In the future, China will independently develop more project methodologies, which, to some extent, represents an attempt by China and other state actors to “reclaim” rule-making power over emission-reduction project standards. The relationship between non-state actors and state actors—whether it will lead to integration or division—remains unclear. This study analyzes the current situation and looks forward to further in-depth research.