Your responsibilities when land enters the ETS

Understand your ETS responsibilities

It’s important to understand your responsibilities when you register forest into the ETS. The rules of the ETS can be complicated, and there can be penalties for not following the rules, including fines.

Find out about joining the ETS for forestry

The forest land you can register into the ETS is called "post-1989 forest land".

Find out more about what post-1989 forest land is

Once you register and your land enters the ETS, your responsibilities include:

• completing accurate emissions returns and submitting them on time when required – an emissions returns is a report about the change in carbon in your forest, and an assessment of how many New Zealand Units (NZUs, units or carbon credits) you’ll earn, or have to pay (known as “surrendering” units)
• paying (surrendering) units by the given deadline if you owe them
• collecting and keeping records about any calculations of carbon changes in the forest and any harvesting and replanting undertaken
• telling us about any changes you are required to tell us about
• completing measurements at specific locations if you have more than 100 ha of post-1989 forest land in the ETS
• telling us if your harvest your land and don't intend to replant it within 4 years.

Emissions returns and when to submit them

When forest land ownership or land agreements change

Measuring your forest if you have more than 100 ha in the ETS

Removing land from the ETS

Post-1989 forest land not in the ETS

Joining the ETS is completely voluntary. If you own post-1989 forest land (a kind of forest in the ETS), you have no ETS responsibilities if it has not been entered into the scheme.

Find out more about what post-1989 forest land is

Deforesting pre-1990 forest land

There's another kind of forest covered by the rules for the ETS, pre-1990 forest land. You have ETS responsibilities if you own pre-1990 forest land and are deforesting it. This applies even if you didn't register with any other land in the ETS.

Learn more about pre-1990 forest land and what you need to do if you’re deforesting it

Responsibilities and clearing post-1989 forest land

You can register post-1989 forest land in the ETS as “standard” or “permanent forestry”. The ETS has different rules for these when they are registered and when it comes to clearing the forest.

If you register the land as standard forestry:

• you can harvest through clear-felling as long as you make sure the land returns to forest and doesn’t become considered as deforested under ETS rules (see below).
• you’ll surrender the balance of units earned for the land if you deforest the land or decide to leave the scheme later.

If you register the land as permanent forestry:

You’re committing the land to being in the ETS for at least 50 years. During this time:

• the number of trees you can harvest is limited and more than 30% crown cover must remain in each hectare of forest after harvesting
• you could receive a fine if you clear-fell or deforest permanent forestry below 30% crown cover in a hectare.

If you deforest the land or remove the land from the ETS in future, you’ll surrender the balance of units earned for the land.

Learn more about the differences between standard and permanent forestry

Find more about fines for clearing permanent forestry

What is meant by deforestation in the ETS

Deforestation has a specific meaning in the ETS. There are 2 situations when land is considered deforested after forest is cleared.

• The land is converted to be used for something else. For example, if the land is developed for pasture, housing, or another non-forestry use.
• The forest isn’t re-established adequately within set timeframes. This means the forest is replanted or left to regenerate but didn’t meet minimum stocking rates.

How the ETS defines deforestation

Repaying units when deforesting or removing land from the ETS

You’ll be responsible for repaying the net balance of any units you received for an area of your land in the ETS if you:

• decide to remove land from the ETS
• must remove land from the ETS, for example, if it is considered deforested under ETS rules.

If you sold your units earlier, you’ll have to buy units to repay. The price of units goes up and down. If the price of units has increased since you sold them, you may make a financial loss.

What happens if you don’t meet your responsibilities

If you don’t meet your ETS responsibilities, you risk receiving a fine.

You may be fined if:

• you don’t submit an emissions return on time
• we find that you submitted an inaccurate emissions return
• you don’t pay (surrender) units before your deadline
• you clear-fell post-1989 forest land in permanent forestry
• you don't collect and keep records about your forest carbon calculations
• you don't tell us within 20 days if you deforest pre-1990 forest land
• you don't tell us when the responsibility under the ETS for the post-1989 forest land is transferred to another party – including changes in ownership or registered forestry rights or leases
• you don't keep us informed if something changes that is relevant to an application for an emissions ruling.

Find out more about permanent forests and the ETS

For more serious breaches of the ETS rules, you could be fined and/or imprisoned, for example if you:

• hinder our investigations into non-compliance
• provide false information to the ETS Registrar.

Find out more about ETS penalties 

You are responsible even if you hire a third party

Even if you use a third party to manage your responsibilities in the ETS, such as an ETS representative or forestry consultant, you are still liable.

You are liable for ensuring your ETS obligations are met. This includes when someone is acting on your behalf. If something goes wrong, you could receive a penalty. For example, this could happen if your representative makes a mistake in your emissions return or doesn't submit your emissions return.

Find out more about appointing a representative in the ETS and what to look out for

Find out more about penalties in the ETS

Agreements where someone else earns units on the land

In some cases, there may be an agreement where a landowner allows another party to use their land for forestry, such as a registered:

• forestry rights agreement
• leasehold.

Read more about what happens when there are registered forestry rights and leases on land in the ETS