Chinese Premier Li Qiang has signed a decree of the State Council, introducing new regulations governing ecological protection compensation.

Effective June 1, 2024, the regulations comprise 33 items in six chapters, specifying details including the connotation of ecological protection compensation, the working principle and mechanism, fiscal vertical compensation, horizontal compensation between regions, market-oriented compensation, and strengthening guarantee, supervision and management.

Governments above the county level shall strengthen organizational leadership, with relevant departments of the State Council assuming responsibility for related tasks in accordance with their respective duties, as outlined in the regulations.

The country will provide compensation to entities and individuals engaged in the protection of important ecological and environmental elements, as well as ecological preservation efforts in areas with significant ecological functions, through financial transfers and other means.

The central government will encourage, guide and promote the establishment of ecological protection compensation mechanisms through consultation between the local governments of ecological beneficiary areas and ecological protection areas.

The regulations give full play to the role of market mechanisms, and encourage social forces and local governments to engage in ecological protection compensation by purchasing ecological products and services in accordance with market rules.

The government and its pertinent departments must issue and approve the distribution of ecological protection compensation funds in a timely manner. They reserve the right to delay, reduce, stop, or reclaim allocated funds from those who withhold, misuse, misappropriate, fail to pay, or misuse funds contrary to regulations and fail to rectify the situation within the specified timeframe.