Foreign companies will now be allowed to trade CO2 permits and offsets in Hubei’s carbon market, China’s State Administration of Foreign Exchange (SAFE) has ruled.

SAFE, which oversees rules and regulations for foreign exchange market activities in China, will let international firms that meet certain requirements participate in the Hubei ETS, the provincial carbon exchange announced Monday.

Foreign firms can provide more professional services to Hubei’s market and help boost liquidity ahead of the launch of a national ETS in late 2016 or early 2017, Tian Qi, a climate official with the Hubei DRC, said at an event at the exchange Monday to mark China’s low carbon day.

Previously, Shenzhen and Guangdong have allowed foreign traders to join its emissions market. In other markets, only Chinese subsidiaries of foreign firm can obtain trading licenses.

By Stian Reklev – stian@carbon-pulse.com