This Act is designed to implement part of the necessary legal measures based on the Green Transformation (GX) Basic Policy which was approved by the Cabinet on 10 February 2023. Under the GX Promotion Act, the Government is required to formulate a strategy for promoting structural transition based on decarbonisation (the "GX Promotion Strategy") in order to comprehensively and systematically promote measures for GX. Matters to be determined in the GX Promotion Strategy include the goals of GX, basic direction, matters concerning business areas that are expected to have a high impact on GX policy and support measures, matters concerning each measure stipulated in the GX Promotion Act, and matters concerning the evaluation of the achievement status of the GX Promotion Strategy.
In May 2025, Japan enacted the Amended GX (Green Transformation) Promotion Act. Amendment provisions obligate businesses which have carbon emissions above a designated amount to notify the Minister of Economy, Trade and Industry of their emission targets every fiscal year from fiscal year 2026, following which the Minister shall allocate a business emissions allowance. The GX Acceleration Agency shall establish and operate an emission allowance trading market for conducting emission allowance trading. Other amendment provisions operationalise the fossil fuel surcharge to be collected from fossil fuel extracts from fiscal year 2028.
