What are ITMOs? Authorisation, Transfer, and Use Explained

Internationally Transferred Mitigation Outcomes, or ITMOs, are the units of cooperation that allow countries to trade emission reductions and removals to meet their Paris Agreement targets. Unlike voluntary carbon credits, ITMOs are formally authorised by host governments and accounted for in national greenhouse gas inventories. They move through three distinct phases: authorisation, transfer, and use. This piece walks through each phase and where the market currently stands.

What Is an ITMO?

An ITMO is a verified emission reduction or removal that has been authorised by a host country for international transfer under Article 6 of the Paris Agreement. Each unit represents one tonne of CO2-equivalent.

The defining feature of an ITMO is the corresponding adjustment: when a host country authorises a credit for export, it adds an equivalent amount of emissions back to its national inventory, while the buyer country subtracts the same amount from theirs. This double-entry accounting prevents two countries from claiming the same tonne against their NDCs.

Without authorisation and a corresponding adjustment, a credit remains a voluntary carbon market unit. Useful for corporate claims, but not for compliance with national targets or schemes like CORSIA.

Authorisation: Where the Process Begins

Authorisation is the gatekeeping step. The host country, through its designated national authority, formally authorises a specific volume of mitigation outcomes for international transfer. Letters of authorisation specify the project, methodology, vintage, and which use cases are approved (typically another country's NDC, CORSIA, or other international mitigation purposes).

Most host countries are still building the legal and institutional infrastructure to issue authorisation at scale: domestic registries, eligibility lists, fee structures, and approved methodology lists. As at 15 November 2025, the UNFCCC had received reports on 39 cooperative approaches and 24 country authorisations submitted by 14 Parties under Article 6.2, with technical expert reviews flagging widespread inconsistencies in country reporting.

Transfer: Article 6.2 vs Article 6.4

There are two transfer pathways. The Article 6.2 Mechanism governs bilateral cooperative approaches between countries. Switzerland has signed 17 Article 6.2 agreements as of April 2026, covering host countries including Ghana, Peru, Senegal, Thailand, and Vanuatu, with the KliK Foundation acting as commercial buyer. Singapore has signed bilateral deals with more than 15 partner countries, while Japan operates the long-running Joint Crediting Mechanism across Asia.

The Article 6.4 Mechanism, formally known as the Paris Agreement Crediting Mechanism (PACM), is the centralised successor to the Kyoto-era Clean Development Mechanism. The first PACM methodology (A6.4-AMM-001, covering landfill gas) was endorsed in Q4 2025, and the first ITMOs were issued in Q1 2026 to a clean cookstove project in Myanmar, financed by South Korean entities. The issuance came in roughly 40% lower than the project's prior CDM estimate, reflecting tighter baseline and additionality requirements. More than 165 transition projects sit in the pipeline, with further methodologies expected through 2026.

Use: From NDC Compliance to CORSIA

Authorised ITMOs can be used for three main purposes. The most direct is NDC compliance, where the buyer country counts the credit toward its own national target. ITMOs that meet ICAO eligibility rules can also be used by airlines under CORSIA. A third category, Other International Mitigation Purposes (OIMP), covers uses such as Switzerland's compensation obligations on motor fuel importers, or corporate offsetting under specific bilateral frameworks.

Under Article 6.4, a parallel category exists for credits issued without authorisation for international transfer, known as Mitigation Contribution A6.4ERs. These are not ITMOs in the strict sense; they support host-country NDC achievement or are sold as voluntary contribution claims rather than offsets.

Where the Market Bottleneck Sits

Across the three phases, authorisation is where most of the implementation friction sits. Transfer mechanics are increasingly defined: the PACM registry is operational, bilateral templates are mature, and the first issuances have begun. Use cases are codified.

Authorization, by contrast, depends on each host country having the legal and institutional infrastructure to assess, approve, and track international transfers, and that infrastructure is uneven. Ghana and Kenya have stood up domestic carbon registries and Article 6 frameworks; many other host countries are still drafting their criteria. For buyers and developers, deal flow in 2026 will be shaped less by transfer mechanics than by which host countries are ready to authorise at scale, and on what terms.

A separate question shapes the market from the demand side. UN analysis describes 2030 ITMO demand as 'small,' with roughly 10% of the 168 Parties signalling Article 6 intent expected to be net buyers and around 90% expected sellers. We covered the buyer landscape in detail in a recent LinkedIn carousel

Key Takeaway

ITMOs sit at the intersection of national climate accounting and international markets. The lifecycle (authorisation, transfer, use) is conceptually clean, but the practical pace of issuance depends on both host-country capacity to authorize and the structural shape of buyer demand. With the first PACM credits flowing and bilateral pipelines expanding, 2026 will test whether the supply infrastructure now in place finds a matching scale of demand.