SAO PAULO, June 3 - Brazilian prosecutors are seeking to

annul a $180 million carbon offset scheme supporting

conservation of the Amazon ( AMZN ) rainforest, which the state of Para

signed last year with a coalition of major corporations and

foreign governments, according to a lawsuit filed on Tuesday.

The case could be a blow to the government of Para, which is

hosting this year's United Nations climate summit, known as

COP30, as well as the wider carbon credit market, which has

looked to government programs as a way to address concerns about

fraud and abuse.

Amazon.com Inc ( AMZN ) and at least five other companies

had agreed to purchase the credits through the LEAF Coalition

forest conservation initiative, which the e-commerce

giant helped to found in 2021 with a group of other firms and

governments, including the United States and United Kingdom.

The state of Para had aimed to sell up to 12 million credits

at $15 each, representing the value of carbon stored in trees

that the project would save from deforestation through 2026.

In the filing, prosecutors argued that the state government

had failed to inform and consult traditional communities that

would be impacted by the deal. They also said Brazilian law does

not allow for the pre-sale of carbon credits.

Prosecutors accused the state of rushing to approve the plan

"before COP30, which has generated considerable pressure on

Indigenous peoples and traditional communities in Para."

The government of Para dismissed the allegations by

prosecutors, saying that it is planning 47 consultations with

communities that may be affected by the project, none of which

are obligated to participate.

The state government also said in a statement that any sales

will only be finalized when emission reductions are verified and

credits are formally issued.

Emergent, a non-profit group that coordinates the LEAF

Coalition, did not immediately reply to requests for comment.

The Para state project was one of the world's first

"jurisdictional" carbon credit schemes, covering a whole state

or country in order to address concerns about the impact and

credibility of projects that rely on private landowners.