Three Phases, 2027 to 2031: Brazil Sets the MRV Clock for Its ETS

Brazil’s Ministry of Finance issued a regulation on Thursday formalising monitoring, reporting and verification (MRV) obligations for its emissions trading system, setting a phased timetable for regulated industries ahead of the scheme’s gradual implementation, according to Carbon Pulse. For companies, investors and credit buyers, the Brazil ETS MRV schedule is the first firm calendar showing which sectors must prepare first and when verified emissions data will start to flow to the regulator.

What the ordinance establishes

The instrument is Ordinance No. 3,199/2026 of the SEMC/MF, published on 29 October 2026, according to Mattos Filho. It sets the schedule for MRV obligations in sectors regulated under the Brazilian Emissions Trading System (SBCE). The requirements are phased in over three stages, from 2027 to 2031.

The year attached to each stage is its first year, called A1. Sectors are identified by CNAE codes, the Brazilian classification of business activities, listed in three annexes to the ordinance, according to Mattos Filho.

Who is covered and at what size

The thresholds come from Law No. 15,042/2024. The MRV requirement applies to entities with annual emissions above 10,000 tCO2e, while periodic reconciliation applies only to those above 25,000 tCO2e, according to Mattos Filho.

Smaller emitters therefore sit outside the system. For installations near the lower threshold, the practical question is whether verified inventories will place them in or out.

The three phases by sector

Phase 1, with A1 in 2027, covers aluminium, integrated iron and steel mills, cement, oil and natural gas exploration and production, parts of the chemical industry (adipic, phosphoric and nitric acid, ammonia, ethylene, dichloroethane, vinyl chloride and carbon black), iron ore and bauxite mining, pulp and paper, and glass, according to Mattos Filho.

Phase 2, running through 2029, covers ceramics, semi-integrated steel mills, other chemicals, food and beverages, other mining, oil refining and the electricity sector. Phase 3, running through 2031, covers waterway, rail and road transportation.

The steel split is deliberate. Stage 1 takes only integrated mills, where ore reduction and liquid steel production happen in the same complex. Stage 2 takes semi-integrated mills that produce steel from scrap and pig iron bought from third parties, according to Mattos Filho.

What companies must deliver, and when

In the first year of a stage, the company submits its monitoring plan to the SBCE managing authority for review and approval. The following year, installations monitor emissions and removals throughout the year under the approved plan, according to Mattos Filho.

For pulp and paper, a Phase 1 sector, that means plans in 2027, measurement from 2028 and the first verified reports in 2029, according to Campo Grande News. After that the cycle repeats annually, each time with information for the previous year. The ordinance also requires a minimum notice of 150 days before the start of the respective obligations, according to the same report.

Source: CarbonMeld — independent carbon credit market intelligence. Document-based quality scores and assessments across all major registries: carbonmeld.com

The verification step matters most for the market. A first set of third-party verified data in 2029 is what any later allocation or reconciliation would have to rest on.

What the ordinance does not decide

The schedule covers preparation and reporting, not cost. The ordinance sets no carbon price, no emissions limit per plant and no quantity of credits that any facility must buy, according to Campo Grande News. Submitting a plan in 2027 is therefore not, by itself, an immediate charge on industry.

Scope is also unfinished. Including a CNAE code in the annexes does not subject every activity under that code to MRV, and the managing body will define regulated sources, facilities and activities in specific regulations, according to Mattos Filho. An activity counts as regulated if it is carried out at the facility, even under a secondary CNAE code in the establishment’s registration.

Two further gaps stand out. The ordinance does not define how companies should account for planted forests, nor does it state that such areas will generate tradable credits, according to Campo Grande News. And air transport follows a separate route: MRV will comply with ANAC rules under the ProBioQAV sustainable aviation fuel framework, with data interoperability between ANAC and the managing agency, without exemption from SBCE requirements, according to Mattos Filho.

Implications for buyers, developers and investors

For regulated companies in Phase 1, the lead time is short. Monitoring plans are due in 2027, so methodology choices, metering and verifier selection need to be settled during the coming year.

For investors and credit buyers, the ordinance is a data milestone, not a demand signal. Until price mechanics, caps and the treatment of offsets are defined, the volume of regulated demand cannot be estimated. Developers of removal projects should note that the forest accounting question remains open.

There is also a difference in how the timetable is described. Carbon Pulse refers to gradual implementation through 2030, while the Mattos Filho analysis places the last stage’s first year in 2031. Readers should check the ordinance text for the exact dates that apply to their sector.

What to watch

The next signals are the managing body’s specific regulations defining regulated sources and facilities, and any guidance on forest removals. Watch also for the 150-day notices that precede each obligation, which will show how quickly Phase 1 sectors are actually being brought into the system.