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The CERSPA Initiative

The aim of the CERSPA Initiative is to develop a new, open source CDM carbon contract. Climate Focus, together with Lee International, is coordinating the initiative which is sponsored, among others, by the Inter-American Investment Corporation and involves over 20 CDM lawyers – most from developing countries.

As the carbon market grows, there is a need to assist some project developers with drafting and negotiating contracts. Many Clean Development Mechanism (CDM) projects, particularly smaller ones, are developed by entities that do not have the means to obtain advice from expert law firms. Few sellers have legal advisors with CDM experience and many project developers rely on their generalist lawyers or try to manage the negotiation process without legal assistance at all.

More than 20 lawyers, most from developing countries, have come together in an initiative to develop a new Certified Emission Reduction Sale and Purchase Agreement (CERSPA) template. The objective of the initiative is to develop a simple, understandable and balanced CDM project agreement. The template agreement will assist sellers participate in the international carbon market on an equal footing with more experienced buyers.

The initiative does not prescribe a particular model. Instead, the template and supporting documentation are expected to be adapted to specific deals and continue to evolve over time as more lawyers, project developers and other stakeholders have the opportunity to use it and provide their input and feedback.

The Inter-American Investment Corporation (Washington, DC) is the main sponsor of the initiative. Additional support was provided by Climate Focus (Rotterdam, The Netherlands), Lee International (Maine, USA), the Corporación Andina de Fomento (Caracas, Venezuela), Siqueira Castro Advogados (São Paulo, Brazil), Jun He Law Offices (Beijng, China) and the Center for International Sustainable Development Law (Montréal, Canada).