IMO Net-Zero Shipping Framework: A Crossroads for Global Shipping Regulations( continued from page 3)
On August 11, 2025, the United States lodged a submission to the IMO’ s Marine Environment Protection Committee listing“ unacceptable risks” and urging members to vote against the adoption of the Framework. The document characterizes the package as an inflammatory global tax that would saddle consumers with higher prices, penalize proven transitional fuels such as LNG, and generate a vast fund“ without guidelines, guardrails or anti-money laundering controls.”
Secretary of State Marco Rubio and the Secretaries of Commerce, Energy, and Transportation also issued a Joint Statement, released on August 12, 2025, indicating that the United States will consider all available measures, including threatening retaliation and tariffs against countries supporting the measure, to protect American maritime and economic interests should the Framework be adopted.
With the adoption vote approaching and requiring significant support from IMO member states, it remains uncertain whether the Framework will ultimately be adopted and which countries will align themselves with the United States’ position. To date, Iran, Iraq, Bahrain, Kuwait, Saudi Arabia, the UAE, Venezuela, and Yemen have argued against adopting the Framework, but it is unclear if other IMO Member States will follow suit.
Challenges, Uncertainties, and Next Steps While the Framework, including its draft regulations, is a significant accomplishment, several uncertainties remain:
• Finalization of Implementation Guidelines. The economic viability of various fuels, especially biofuels and LNG, hinges on the final WtW GHG conversion factors, which are not expected until the second quarter of 2026.
• Reward Mechanism for ZNZ Fuels. The methodology and quantum of rewards for ZNZ fuel use are yet to be determined, complicating investment decisions for shipowners and fuel suppliers.
• Market Dynamics. At the heart of the U. S. government’ s position is a pragmatic concern— there is currently not enough green fuel or infrastructure to meet the IMO timeline. ZNZ fuels, such as green methanol, ammonia, and hydrogen are just out of pilot phase. Retrofitting global bunkering infrastructure will take years and trillions of dollars. Meanwhile, critics argue the current Framework rewards only fuels with near-zero lifecycle emissions, a category that excludes most transitional fuel options, such as LNG, thereby forcing the industry either to pay punitive fees or bet on fuels that do not yet exist at scale.
• Adoption of the Framework. To be adopted, the Framework must be approved by a two-thirds majority of IMO Member States, representing 50 percent of world tonnage. As such, major flag States will play a critical role.
Conclusion: Preparing for a Decarbonized Future The Framework represents a significant step for the maritime industry. It would establish a global carbon price, mandate aggressive GHG intensity reductions, and create powerful incentives for the adoption of ZNZ emission fuels and technologies. However, the Framework’ s ambitious goals are accompanied by significant challenges, including technical uncertainties, evolving market dynamics, and pronounced political division.
The Framework’ s ambitious goals are accompanied by significant challenges, including technical uncertainties, evolving market dynamics, and pronounced political division.
The outcome of the upcoming adoption vote in October 2025 and the resolution of outstanding implementation details will determine the Framework’ s effectiveness and global reach.
For industry stakeholders, if the Framework regulations are adopted, the coming years will demand proactive investment in compliance strategies, fuel supply chains, and new technologies, as well as close engagement with regulatory authorities and ongoing policy developments. Robust reporting and verification processes are also central to this Framework, with the IMO GFI Registry serving as the central platform for compliance tracking, surplus unit trading, and reward disbursement.
If the Framework is not adopted, the maritime industry can almost certainly expect fragmented domestic regulations, investor uncertainty, and potential trade retaliation. Shipowners weighing muti-billion-dollar newbuild decisions need clarity on future carbon liabilities and prolonged uncertainty could freeze orders or lock in carbon-intensive tonnage. Meanwhile, tariff threats could escalate beyond shipping and ripple across other sectors, from steel to agriculture, all dependent on shipping to move cargo.
The maritime industry’ s ability to adapt to these complex and evolving requirements( if adopted), seize opportunities for innovation, and collaboration across the value chain will determine its success in navigating the transition to a decarbonized future. p – 2025 BLANK ROME LLP
MAINBRACE • 4