CUHK LAW LLM graduate Sijin Lai has published an article entitled “Regulatory uncertainty under fragmented authoritarianism: decarbonization challenges in China’s national emissions trading scheme” in the Journal of Environmental Law (Oxford University Press).

About the article: China’s national carbon emissions trading scheme (NCETS) faces persistent challenges in generating a price signal capable of mobilizing large-scale decarbonization investment. Existing scholarship’s emphasis on technical rule design has limited its ability to explain this underperformance, leading scholars to conflate early-stage capacity constraints with structural limitations and to overlook interactions among central government agencies. This article situates the NCETS within China’s environmental governance framework and examines the institutions that shape decision-making, the structure of their interactions, and how this governance configuration weakens the NCETS’s capacity to generate incentives for low-carbon investment. It argues that fragmented authoritarianism has displaced both environmental authoritarianism and environmental federalism in Chinese emissions trading regulation and practice. The opaque, stakeholder-driven decision-making process embedded in the legal framework, together with asymmetries in bargaining power and divergent departmental interests, deprioritizes allowance scarcity and regulatory stability, thereby reducing investment incentives under the NCETS.

Read the article here.