The carbon offset industry on trial

A new UN report(opens in new window) by Special Rapporteur Elisa Morgera confirms what communities have confronted for years: the problem is not a few bad projects but how carbon markets are built. The report identifies “inherent structural faults in carbon credit markets” and urges States to discontinue carbon credit schemes that systematically fail to deliver climate mitigation or protect human rights. It arrives as the UN Environment Programme warns(opens in new window) that even an optimistic climate pathway could reach a global heating of 1.8°C. Yet carbon offsets let companies claim climate action while they keep polluting, and every credit they buy puts off the drastic emission cuts the world needs.

For communities, the impacts are often immediate. Who decides what happens on their land? Can they keep using the forests that sustain them? Why are they surveilled on their own land? The offset industry shifts responsibility from polluters to the people least responsible for the climate crisis. Project developers have repeatedly been reported(opens in new window) to not conduct proper consultations, and auditors have largely(opens in new window) failed to raise and challenge problematic issues. In response, many communities have turned to the courts over the last couple of years. In March, 2025, we analysed how courts in the Global South were stepping up while governments and corporations in the Global North sidestepped their climate commitments. Those cases have since advanced and brought the resistance to the international fora.

Taking resistance into the courtroom

Brazil

In Brazil, the Tuxa Ta Pame Council of the Ka’apor People is challenging(opens in new window) a proposed offset project before the 3rd Federal Civil Court of Maranhão. The project concerns the Alto Turiaçu Indigenous Territory.

The Council alleges(opens in new window) that the project advanced without legitimate free, prior and informed consent from all Indigenous Peoples living in the affected territory. The project developer disputes(opens in new window) this account and maintains that its engagement was participatory. In May 2025, the court suspended project activities while questions about consultation and representation are clarified. The company appealed, and the suspension is not a final cancellation. Yet, the Council secured a crucial interruption: the project could not simply advance while its legitimacy was contested. Tuxa Ta Pame continues to demand its cancellation.

That demand exposes a weakness in the language of safeguards. Consultation means little if the only acceptable outcome is agreement. Morgera’s report warns that even where consultation processes take place, they can “fail to respect opposition grounded in self-determination”. The Ka’apor People case brings that concern into the courtroom. The case is still pending.

Peru

The same question has reached Peru’s Constitutional Court. The community of Puerto Franco and its federation for the Kichwa People in the Amazon, CEPKA, supported by the Instituto de Defensa Legal (IDL) and the NGO Forest Peoples Programme, are fighting(opens in new window) before Peru’s high court for recognition(opens in new window) of ancestral territory affected by an offset project established in the Cordillera Azul National Park.

Their claims include respect for the community’s rights to proper consultation, access to resources, participation in decisions and benefit sharing from carbon credit activities. But what is really at stake is the community’s ability to sustain its life on its own territory.

In 2024, the community won a favourable first-instance judgment, but an appeal overturned(opens in new window) it. That reversal shows how much persistence litigation demands, and why attention cannot end with a legal victory. At a Constitutional Court hearing(opens in new window) last July, community leader Elina Salas spoke about future generations: “It is for them that we are fighting.” A decision is expected in the coming months.  

Kenya

In Kenya, the courtroom has also become a recurring front. In January 2025, the Environment and Land Court in Isiolo ruled(opens in new window) that two Northern Rangelands Trust (NRT) conservancies used for carbon offsetting, including Biliqo Bulesa, had been established illegally and unconstitutionally; that ruling is under appeal(opens in new window) . In October 2026, more than 30 members of the Indigenous communities of Biliqo Bulesa returned to the same court, this time to challenge(opens in new window) the Northern Kenya Rangelands Carbon Project directly. The project is one of the world’s largest soil carbon offset schemes. Community members allege that NRT enrolled their land in the carbon project without their free, prior and informed consent. The sale of the project’s credits by the certifier Verra has already been suspended twice, after Survival International’s 2023 report(opens in new window) and again after the 2025 ruling.

What the cases add up to

Seen together, these cases show what courts can do to corporate power. They can interrupt a project before it advances, as in Brazil. They can undermine a project’s legal basis, as in Kenya. And they can force a company to defend its claims of “community consent”, as in Peru. Voluntary standards and certifications have largely failed to achieve these outcomes. 

A new ruling affirming the community’s rights would build on important precedents from Kenya and Colombia, where communities used courts to challenge offset projects for violating their territorial rights. Together, these struggles are making courts in the Global South vital spaces for defending Indigenous Peoples’ rights as well as for exposing how carbon offset projects often require people to give up their livelihoods and control over their territories in return for uncertain and volatile carbon market benefits.

From community struggles to wider climate obligations

These cases are fought one community at a time, but they are not fought alone. Climate advisory opinions are strengthening the legal grounds for accountability. The 2025 opinions of the International Court of Justice(opens in new window) (ICJ) and the Inter-American Court of Human Rights(opens in new window) clarify States’ climate obligations, giving communities and their lawyers authoritative standards to invoke against harmful policies and corporate conduct. Drawing on the ICJ’s opinion, Morgera’s report finds that the structural defects of carbon markets conflict with States’ duties to prevent harm, ensure corporate accountability and protect human rights. Advisory opinions do not decide on individual cases, but they can strengthen the grounds on which they are fought.

Civil society organisations in Africa are now seeking that clarification within their own regional human rights system. The Pan African Lawyers Union (PALU)(opens in new window) has asked the African Court on Human and Peoples’ Rights to clarify States’ climate obligations. The request extends well beyond carbon markets, but could strengthen standards on preventing harm, regulating corporate conduct and ensuring effective remedies.

Within this broader request, SOMO, the Promise Institute for Human Rights, Climate Counsel and Sudan Human Rights Hub have submitted a joint amicus brief(opens in new window) . It requests the African Court to address the human rights implications of carbon offsets and clarify States’ duties to prevent harm and ensure corporate accountability, and to bring research and legal arguments to strengthen rights protection.

A collective legal front against false climate solutions

These proceedings pursue different outcomes, but they confront the same imbalance. On one side are the corporations that develop projects, the certifiers that give them legitimacy and the buyers who turn them into climate claims. On the other are the communities who must prove, case by case, when their rights were not respected. Litigation doesn’t remove that imbalance, but it forces it into a forum where evidence, consent and accountability matter more than market access. 

Morgera’s report responds by calling for corporate liability across the carbon crediting value chain. It not only identifies access to justice and effective remedies as rights undermined by the market’s structural failings, but it also explains why remedies matter beyond individual cases: helping identify what went wrong, drawing lessons and preventing the repetition of human rights violations. Securing justice for one community can strengthen protection for others.

Carbon markets were built to give corporations a way to claim climate action without changing their businesses or pollution. Courts are not a quick fix, but they are one of the few places where a community’s “no” can force the offset industry to stop and be accountable for their harms. Each ruling, suspension, and hearing makes it harder to present carbon credits as a real solution and easier for the next community to be heard. A just transition depends on people being able to defend their territories. These struggles are helping turn free, prior and informed consent, self-determination and access to justice into enforceable limits on corporate power.