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In brief

On 14 January 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 nonmonetary), the provision of social improvements to rural and urban communities; and the 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, the PNPSA brings provisions that affect 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 that 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 groups — that, through their actions, maintain, recover or improve the environmental conditions of ecosystems. In this sense, the law prioritizes aid to small producers, indigenous and quilombola 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 nonmonetary 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, the 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 that 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.

Portuguese version

Author

Renata Campetti Amaral joined the firm in 2002 and became a partner in 2013. She is the head of the firm’s Climate Change, Environmental Law and Sustainability group in Brazil, and the leader of Ablfs McKfnzif’s global climate change group in Latin America. Is also the coordinator of the sustainability initiatives conducted by the office’s B-Green Committee. Renata assists the major players in the Brazilian market in Nature-bases Solution (NbS) projects, transaction of carbon credits, implementation of decarbonization strategies and carbon-related advocacy and regulatory matters. Renata leads several of the largest environmental and regularization cases in the country. She has extensive experience in sustainability matters, as well as in managing crises and negotiating with stakeholders. Advises on negotiating with authorities; judicial and administrative litigation; reviewing environmental aspects of institutions and financial operations; drafting environmental provisions in contracts and other commercial operations. Renata has extensive experience in dealing with environmental management, legal auditing and other organizational practices; regulatory and institutional analysis and environmental control; negotiation and implementation of environmental remediation plans; environmental licensing; legal aspects of biodiversity protection; environmental crisis management; development of preventive policies and strategies for companies; negotiation and drafting of contracts for the purchase and sale of carbon credits and acting in transactions related to various aspects of the energy transition.
*Trench Rossi Watanabe and Baker McKenzie have executed a strategic cooperation agreement for consulting on foreign law.

Author

Giovani Bruno Tomasoni joined the Firm in 2008 and became partner of the Environment, Consumer and Sustainability practice group in 2020. He practices with focus on Environment, Public Law, Energy, Forestry, and helps clients in the internalization of concepts such as sustainability, ESG, circular economy, environmental compliance, among others.
*Trench Rossi Watanabe and Baker McKenzie have executed a strategic cooperation agreement for consulting on foreign law.

Author

Alexandre Salomão Jabra joined the firm in 2010. He integrates the environmental, consumer and sustainability practice group, with focus on consultancies, administrative procedures lawsuits and negotiations. In the environmental area, Alexandre has a wide breadth of experience in cases involving contamination, environmental and urbanistic licensing procedures, environmental liability, management of solid wastes and take-back requirements, effluents, electromagnet pollution, air emissions, forestry matters, protected areas and minorities, biodiversity, controlled chemicals products, socio and environmental liability of financial institutions, climate change, carbon markets and urbanistic regularization. In the consumer area, Alexandre has experience with consultations, administrative and judicial procedures related to Consumer Law issues with federal, state and municipal agencies, such as DPDC, PROCONs, Public Prosecutors and Municipalities involving recall, offers, data protection, misleading and abusive advertising, privacy, e-commerce, abusive clauses, commercial practices, terms and conditions and violations to the Brazilian Consumer Defense Code. Alexandre represents several clients in the oil&gas, automotive, chemicals, technology, food, communications, mining, finance and services sectors.
*Trench Rossi Watanabe and Baker McKenzie have executed a strategic cooperation agreement for consulting on foreign law.