National Policy for Payments for Environmental Services is implemented

In Brief

On January 14th, 2021, Federal Law No. 14.119/2021 was published to establish the National Policy of Payments for Environmental Services (“PNPSA”), which aims to encourage the preservation of ecosystems, water resources, soil, biodiversity, genetic heritage and associated traditional knowledge, valuing ecosystem services economically, socially and culturally. The Law is already in force.

Comments

According to the PNPSA, those who benefit from environmental services, such as water supply, oxygen production, stability of climatic conditions, among others, must pay for them, through a voluntary transaction. On the other hand, those who provide such services must be rewarded for their contribution.

The Policy focuses on maintenance, recovery and improvement of vegetation coverage in priority areas for conservation and seeks to combat habitat fragmentation and encourage the formation of ecological corridors.

The payment can be made through different modalities, among them direct payment, (monetary or non-monetary(, the provision of social improvements to rural and urban communities; Rural Environmental Quota and sale of green bonds, which opens space for the monetization of preserved areas and encourages the voluntary carbon market.

In addition, PNPSA brings provisions that impact the collection of taxes and institute incentives for environmental protection, which can become a great opportunity and a relevant instrument for controlling the negative effects of climate change.

More detail

Any person who uses ecosystem services, such as public authorities, civil society organizations or private agents, individuals or legal entities, whether national or international, will be considered a ‘payer’. The ‘providers’, on the other hand, would be those – private individuals or legal entity established under public or private law, or even a family or community group – that, through their actions, maintain, recover or improve the environmental conditions of ecosystems. In this sense, the law prioritizes aid to small producers, indigenous, quilombolas tribes and traditional communities in the conservation of native vegetation areas.

In these terms, the Policy seeks to recognize individual or collective initiatives that favor the maintenance, recovery or improvement of ecosystem services, through monetary or non-monetary retribution, service provision or other form of reward, such as the supply of products or equipment.

Maintenance, recovery or improvement actions may be carried out in areas covered with native vegetation and/or subject to ecosystem restoration, in integral protection conservation units, wild areas of sustainable use conservation units, quilombola and indigenous lands and areas of conservation exclusion of fishing.

The regulation of the Policy will define the essential clauses for each type of payment agreement to be executed for environmental services.

In addition, PNPSA’s institution strengthens the Floresta+ Program, which aims to encourage conservation of native forest and creates a market for environmental services, a model in which a payer remunerates those who perform effective and lasting actions to maintain the native vegetation in Brazil.

Our Environment and Sustainability team is available for further clarifications on the subject.