“2A Application of Schedules 3 and 4

• “(1) Any provision in this Act that imposes an obligation on, or provides an entitlement to, a person in respect of an activity listed in Schedule 3 or 4—

  • “(a) does not apply to that person unless the Part or subpart in Schedule 3 or 4 in which the activity is listed applies; and

  • “(b) applies subject to sections 178 to 178D.

  “(2) Part 1 of Schedule 3 and Parts 1 and 3 of Schedule 4 apply on and after 1 January 2008.

  “(3) Part 2 of Schedule 3 and Part 4 of Schedule 4 apply on and after 1 January 2009.

  “(4) Parts Part 3 of Schedule 3, subpart 1 of Part 4 of Schedule 3, and subpart 1 of Part 2 of Schedule 4 apply on and after 1 January 2010.

  “(5) Subpart 1 of Part 5 of Schedule 3 applies on and after 1 January 2011, unless repealed under subsection (10) before that date.

  “(6) Subpart 3 of Part 5 of Schedule 3 applies on and after 1 January 2011, unless repealed under subsection (11) before that date.

  “(7) Subpart 2 of Part 4 of Schedule 3, Part 6 of Schedule 3, and subpart 3 of Part 2 of Schedule 4 apply on or and after 1 January 2011.

  “(8) Subpart 2 of Part 5 of Schedule 3 applies on and after 1 January 2011 if the Governor-General makes an Order in Council to that effect.

  “(9) Subpart 4 of Part 5 of Schedule 3 applies on and after 1 January 2011 if the Governor-General makes an Order in Council to that effect.

  “(10) If the Governor-General makes an Order in Council under subsection (8), then subsection (5) and subpart 1 of Part 5 of Schedule 3 is expire and are repealed.

  “(11) If the Governor-General makes an Order in Council under subsection (9), then subsection (6) and subpart 3 of Part 5 of Schedule 3 is expire and are repealed.

  “(12) If, by 30 June 2010, the Governor-General does not make an Order in Council under subsection (8) that applies subpart 2 of Part 5 of Schedule 3, then that subpart and subsection (8) expire and are repealed on 30 June 2010.

  “(13) If, by 30 June 2010, the Governor-General does not make an Order in Council under subsection (9) that applies subpart 4 of Part 5 of Schedule 3, then that subpart and subsection (9) expire and are repealed on 30 June 2010.

  “(14) Subpart 2 of Part 2 of Schedule 4 applies on and after a date to be appointed by the Governor-General by Order in Council.

  “(15) Subpart 1 of Part 5 of Schedule 4 applies on and after a date no earlier than 1 January 2011 to be appointed by the Governor-General by Order in Council.

  “(16) Subpart 2 of Part 5 of Schedule 4 applies on and after a date no earlier than 1 January 2011 to be appointed by the Governor-General by Order in Council.

  “(17) If, by 31 December 2012, the Governor-General does not make an Order in Council under subsection (15) that applies subpart 1 of Part 5 of Schedule 4, then that subpart and subsection (15) expires expire and are repealed on 31 December 2012.

  “(18) If, by 31 December 2012, the Governor-General does not make an Order in Council under subsection (16) that applies subpart 2 of Part 5 of Schedule 4, then that subpart and subsection (16) expires expire and are repealed on 31 December 2012.

  “(19) If, by 31 December 2012, the Governor-General does not make an Order in Council under subsection (15) or (16) that applies subpart 1 or 2 of Part 5 of Schedule 4, as the case may be, then subpart 4 of Part 5 (consisting of sections 177A to 177D) expires and is repealed on 31 December 2012.”

• “(1) The purpose of this Act is to—

  • “(a) enable New Zealand to meet its international obligations under the Convention and the Protocol, including (but not limited to)—

    • “(i) its obligation under Article 3.1 of the Protocol to retire Kyoto units equal to the number of tonnes of carbon dioxide equivalent of human-induced greenhouse gases emitted from the sources listed in Annex A of the Protocol in New Zealand in the first commitment period; and

    • “(ii) its obligation to report to the Conference of the Parties via the Secretariat under Article 7 of the Protocol and Article 12 of the Convention:

  • “(b) provide for the implementation, operation operation, and administration of a greenhouse gas emissions trading scheme in New Zealand that supports and encourages global efforts to reduce greenhouse gas emissions by assisting New Zealand to meet its international obligations under the Convention and the Protocol, and by reducing New Zealand's net emissions below business-as-usual levels.

• “(2) For the purposes of this section, business-as-usual levels means the levels of New Zealand's greenhouse gas emissions, estimated by a Minister or chief executive with powers or functions under this Act at any particular point in time, as if the greenhouse gas emissions trading scheme provided for under this Act had not been implemented.”

“account number means a unique account number assigned to a holding account by the Registrar under section 15(1)(a)

“allocation plan means a plan issued under section 73

“allocation plan means an allocation plan issued under section 73 or 73A

“animal material has the same meaning as in section 4(1) of the Animal Products Act 1999

“animal product has the same meaning as in section 4(1) of the Animal Products Act 1999

“approved overseas unit means a unit, other than a Kyoto unit,—

• “(a) issued by an overseas registry; and

• “(b) prescribed as a unit that may be transferred to accounts in the Registry

“associated person has the meaning given to it by subsection (3)

“carbon accounting area means an area of post-1989 forest land that—

• “(a) is defined by a person who is registered or has applied to register as a participant under section 57 in relation to an activity listed in Part 1 of Schedule 4; and

• “(b) meets any relevant criteria specified in regulations made under this Act

“chief executive, in relation to a Part, means the chief executive of the department that is, with the authority of the Prime Minister, responsible for the administration of the Part

“chief executive responsible for the administration of this Act means the chief executive of the department that is, with the authority of the Prime Minister, responsible for the administration of this Act

“clear, in relation to a tree,—

• “(a) includes—

  • “(i) felling, harvesting, burning, removing by mechanical means, spraying with a herbicide intended to kill the tree, or undertaking any other form of human activity that kills the tree; and

  • “(ii) felling, burning, killing, uprooting, or destroying by a natural cause or event; but

• “(b) does not include pruning or thinning

“coal has the same meaning as in section 2(1) of the Crown Minerals Act 1991

“conversion account means an account in the Registry used for the purpose of converting New Zealand units into assigned amount units

“convert, in relation to a New Zealand unit, means the transfer of the unit to a conversion account in the Registry with the effect specified in section 18CA(5)

“Crown conservation contract means a written agreement with the Crown (including a concession granted in accordance with Part 3B of the Conservation Act 1987) for the removal and storage of greenhouse gases on post-1989 forest land that is Crown land managed or administered under the Conservation Act 1987 or any of the Acts listed in the First Schedule to Schedule 1 of that Act

“Crown land has the same meaning as in section 2(1) of the Crown Minerals Act 1991

“dairy processing, in relation to milk or colostrum, means the first occasion, other than at a farm dairy, on which the milk or colostrum is made subject to heat treatment, freezing, separation, concentration, filtering, blending, extraction of milk components, and the addition of other material, including (but not limited to) food, ingredients, additives, or processing aids as defined in the Food Standards Code

“deforest, in relation to forest land,—

• “(a) means to convert forest land to land that is not forest land; and

• “(b) includes clearing forest land, where section 157A applies

“disposal facility means any facility, including a landfill,—

• “(a) at which waste is disposed; and

• “(b) at which the waste disposed includes waste from a household that is not entirely from construction, renovation, or demolition of a house; and

• “(c) that operates, at least in part, as a business to dispose of waste; but

• “(d) does not include a facility, or any part of a facility, at which waste is combusted for the purpose of generating electricity or industrial heat

“dispose, in relation to waste,—

• “(a) means the final or more than short-term deposit of waste into or onto land set apart for that purpose; and

• “(b) includes incinerating the waste by deliberately burning the waste to destroy it, but does not include recovering energy from it

“dispose, in relation to waste,—

• “(a) means—

  • “(i) the final or more than short-term deposit of waste into or onto land set apart for that purpose; or

  • “(ii) the incineration of waste by deliberately burning the waste to destroy it; but

• “(b) does not include any deposit of biosolids for rehabilitation or other beneficial purposes

“document means a document in any form whether or not signed or initialled or otherwise authenticated by its maker; and includes—

• “(a) any writing on any material:

• “(b) any information recorded or stored by means of any tape recorder, computer, or any other device; and any material subsequently derived from information so recorded or stored:

• “(c) any label, marking, or other writing that identifies or describes any thing of which it forms part, or to which it is attached by any means:

• “(d) any book, map, plan, graph, or drawing:

• “(e) any photograph, film, negative, tape, or other device in which 1 or more visual images are embodied so as to be capable (with or without the aid of some other equipment) of being reproduced

“draft allocation plan means a draft plan draft allocation plan prepared under section 72

“emissions, in relation to an activity listed in Schedule 3 or 4, means carbon dioxide equivalent emissions of greenhouse gases from the activity

“emissions return means—

• “(a) an annual emissions return submitted under section 65; or

• “(aa) an emissions return submitted under section 65A; or

• “(b) a final emissions return submitted under section 106; or

• “(c) an emissions return submitted under section 165, 167, or 168 168A, or 169

“entity, in relation to a group, means a reporting entity or reporting entity’s subsidiary, within the meaning of section 2(1) of the Financial Reporting Act 1993

“exempt land—

• “(a) means pre-1990 forest land that has been declared to be exempt land—

  • “(i) under section 159; or

  • “(ii) under section 160 and in respect of which the conditions in section 160(6) have been met; but

• “(b) does not include any forest land that met the definition in paragraph (a), but has been deforested, and in respect of which the number of units that would have been required to be surrendered in relation to an activity listed in Part 1 of Schedule 3, had the land not been exempt land, have been surrendered under section 165(3) 165(2)

“exotic forest species means forest species that are not a forest species that is not an indigenous forest species

“export has a corresponding meaning to exportation in section 2(1) of the Customs and Excise Act 1996

“farm dairy has the same meaning as in section 4(1) of the Animal Products Act 1999

“Food Standards Code has the same meaning as in section 4(1) of the Animal Products Act 1999

“forest land—

• “(a) means an area of land of at least 1 hectare that has, or is likely when the forest species reach maturity to have, tree crown cover from forest species of more than 30% in each hectare; and

• “(b) includes an area of land that temporarily does not meet the requirements specified in paragraph (a) because of human intervention or natural causes but that is likely to revert to land that meets the requirements specified in paragraph (a); but

• “(c) does not include—

  • “(i) a shelter belt of forest species, where the tree crown cover at maturity has, or is likely to have, an average width of less than 30 metres; or

  • “(ii) an area of land where the forest species have, or are likely to have, a tree crown cover at maturity of an average width of less than 30 metres, unless the area is contiguous with land that meets the requirements specified in paragraph (a) or (b)

“forest species means a tree species capable of reaching at least 5 metres in height at maturity in the place where it is located

“group means a group as defined has the same meaning as in section 2(1) of the Financial Reporting Act 1993

“import has a corresponding meaning to importation in section 2(1) of the Customs and Excise Act 1996

“indigenous forest species means a forest species that occurs naturally in New Zealand or has arrived in New Zealand without human assistance

“international transaction log means an international log established and maintained by the Secretariat to confirm the validity of transactions, including the issue and transfer of Kyoto units between registries and between accounts in the Registry

“Kyoto units means all of the unit types specified in, or in accordance with, the Protocol (namely, assigned amount units, certified emission reduction units, emission reduction units, long-term certified emission reduction units, removal units, and temporary certified emission reduction units)

“landowner,—

• “(a) in relation to Crown land, means the appropriate Minister (as that term is defined in section 2(2) of the Crown Minerals Act 1991); and

• “(b) in relation to land other than Crown land, means—

  • “(i) the legal owner of a freehold estate in the land; or

  • “(ii) if the land is Maori customary land (as defined in section 4 of Te Ture Whenua Maori Act 1993), the person or persons who have title to the land as determined under Te Ture Whenua Maori Act 1993 1993; or

  • “(iii) if the land is Maori freehold land (as defined in section 4 of Te Ture Whenua Maori Act 1993), the legal owner of the land

“Maori land has the same meaning as in section 4 of Te Ture Whenua Maori Act 1993

“merchantable timber means timber from the stem of a tree more than 10 years old, other than—

• “(a) the stump; and

• “(b) wood that is decayed or grossly distorted; and

• “(c) wood that is less than 10 centimetres in diameter diameter, excluding the bark

“mining has the same meaning as in section 2(1) of the Crown Minerals Act 1991

“Minister, in relation to a Part of this Act, means the Minister who is, under the authority of any warrant or under the authority of the Prime Minister, responsible for the administration of the Part

“Minister responsible for the administration of this Act means the Minister who is, under the authority of any warrant or under the authority of the Prime Minister, responsible for the administration of this Act

“natural gas means—

• “(a) all gaseous hydrocarbons produced from wells, including wet gas and residual gas remaining after the extraction of condensate from wet gas; and

• “(b) liquid hydrocarbons, other than condensate, extracted from wet gas and sold as natural gas liquids, for example, liquid petroleum gas; and

• “(c) coal seam gas

“New Zealand unit means a unit issued by the Registrar and designated as a New Zealand unit

“obligation fuel means any fuel specified as obligation fuel in regulations made under this Act

“obligation jet fuel means any jet fuel specified as obligation jet fuel in regulations made under this Act

“operating, in relation to to a disposal facility, means being in control of the facility

“participant means a person who is a participant under section 54

“post-1989 forest land means forest land that—

• “(a) was not forest land on 31 December 1989; or

• “(b) was forest land on 31 December 1989 but was deforested between 1 January 1990 and 31 December 2007; or

• “(c) was pre-1990 forest land, other than exempt land,—

  • “(i) that was deforested on or after 1 January 2008; and

  • “(ii) in respect of which any liability to surrender units arising in relation to an activity listed in Part 1 of Schedule 3 has been satisfied; or

• “(d) was exempt land—

  • “(i) that has been deforested; and

  • “(ii) in respect of which the number of units that would have been required to be surrendered in relation to an activity listed in Part 1 of Schedule 3, had the land not been exempt land, have been surrendered under section 165(2)

“pre-1990 forest land—

• “(a) means forest land—

  • “(i) that was forest land on 31 December 1989; and

  • “(ii) that remained as forest land on 31 December 2007 (taking into account subsection (4) (4)); and

  • “(iii) where the forest species on the forest land on 31 December 2007 consisted predominantly of exotic forest species; but

• “(b) does not include any forest land that met the definition in paragraph (a) but has been deforested and in respect of which any liability to surrender units arising in relation to an activity listed in Part 1 of Schedule 3 has been satisfied

• “(b) does not include any forest land that met the definition in paragraph (a), but—

  • “(i) has been deforested and in respect of which any liability to surrender units arising in respect of an activity listed in Part 1 of Schedule 3 has been satisfied; or

  • “(ii) was declared to be exempt land, has been deforested, and the number of units that would have been required to be surrendered in respect of an activity listed in Part 1 of Schedule 3 had the land not been exempt land have been surrendered under section 165(2)(b)

“primary representative means an individual appointed by an account holder as a primary representative of the account holder in accordance with any regulations made under Part 2

“public notice means a notice published in a daily newspaper in each of the cities of Auckland, Wellington, Christchurch, and Dunedin, and made accessible via the Internet site of the entity giving the notice

“recover, in relation to dispose,—

• “(a) means the extraction of materials or energy from waste for further use or processing; and

• “(b) includes making waste into compost

“recycle, in relation to dispose, means the reprocessing of waste to produce new materials

“registered forestry right means a forestry right registered under the Forestry Rights Registration Act 1983

“registered lease,—

• “(a) in relation to a lease in respect of land registered under the Land Transfer Act 1952,—

  • “(i) means a lease registered under that Act; and

  • “(ii) includes a lease registered under the Land Transfer (Computer Registers and Electronic Lodgement) Amendment Act 2002:

• “(b) in relation to a lease in respect of land that is not registered under the Land Transfer Act 1952, means a lease registered under the Deeds Registration Act 1908

“removal activity means an activity that is listed in Part 1 or 2 of Schedule 4

“removals, in relation to a removal activity, means carbon dioxide equivalent greenhouse gases that are, as a result of the removal activity,—

• “(a) removed from the atmosphere; or

• “(b) not released into the atmosphere; or

• “(c) a reduction from emissions reported in—

  • “(i) New Zealand's annual inventory report under section 32 as required under the Convention or Protocol for any year; or

  • “(ii) any emissions report from New Zealand under a successor international agreement

“reuse, in relation to dispose, means the further use of waste in its existing form for the original purpose of the materials or products that constitute the waste or for a similar purpose

“surrender means the transfer of a unit to a surrender account in the Registry with the effect specified in section 18CA(3) or (4)

“surrender account means an account in the Registry for the purpose of holding units that account holders have surrendered

“waste means any thing that—

• “(a) has been disposed of or discarded; and

• “(b) includes waste that is defined by its composition or source (for example, organic waste, electronic waste, or construction and demolition waste)

“year means a calendar year ending on 31 December”.

“cancel, in relation to a unit, means the transfer of the unit to a cancellation account in the Registry with the effect specified in section 18CA(1)”.

“inventory agency means the chief executive of the department that is, with the authority of the Prime Minister, responsible for the administration of Part 3”.

• “(c) any other prescribed registry”.

“retire, in relation to a Kyoto unit, means the transfer of that Kyoto unit to a retirement account in the Registry with the effect specified in section 18CA(2)”.

“unit means a Kyoto unit, a New Zealand unit, or an approved overseas unit”.

• “(3) A person is an associated person in relation to 1 or more other persons if—

  • “(a) each person is a body corporate and each of the bodies corporate—

    • “(i) consist substantially of the same members or shareholders; or

    • “(ii) are under the control of the same persons; or

  • “(b) any of the bodies corporate—

    • “(i) has the power, directly or indirectly, to exercise, or control the exercise of, 25% or more of the voting power at a meeting of the other; or

    • “(ii) is able to appoint or control 25% or more of the governing body of the other.

• “(4) For the purposes of the definition of pre-1990 forest land, land that was forest land on 31 December 1989 is to be treated as forest land on 31 December 2007 if, on 31 December 2007, the land had—

  • “(a) any standing exotic forest species (dead or alive), other than a strip of standing exotic forest species that had, or was likely at maturity to have, tree crown cover of an average width of less than 30 metres that was not cleared because of restrictions imposed on it by any enactment; or

  • “(b) any other merchantable timber from exotic forest species.

• “(3A) For the purposes of the definition of dispose, a deposit of waste is short-term if, not later than 6 months after the deposit (or any later time that the chief executive has agreed to in writing), the waste is—

  • “(a) reused or recycled; or

  • “(b) recovered; or

  • “(c) removed from the land for any other reason.

• “(4) Pre-1990 forest land, in respect of which conversion to land that is not forest land had commenced prior to 31 December 2007, is to be treated as deforested on 31 December 2007 if, on that date, the land had—

  • “(a) no standing exotic forest species (dead or alive), other than a strip of standing exotic forest species that had, or was likely at maturity to have, tree crown cover of an average width of less than 30 metres; and

  • “(b) no other merchantable timber from exotic forest species.”

• “(vii) a surrender account:

• “(viii) a conversion account:”.

• “(b) if written consent is not given, the Minister of Finance gives the account holder reasonable notice and—

  • “(i) the transfer is required to comply with New Zealand's obligations under the Protocol; or

  • “(ii) the account holder has failed to comply with Part 2 or any regulations made under section 30G; or

• “(c) section 30F(3) applies.”

• “(2) The purpose of the Registry in relation to New Zealand units and approved overseas units is to ensure—

  • “(a) the accurate, transparent, and efficient accounting of—

    • “(i) the issue of New Zealand units; and

    • “(ii) the holding, transfer, surrender, and cancellation of New Zealand units and approved overseas units; and

    • “(iii) the conversion of New Zealand units into assigned amount units; and

  • “(b) the accurate, transparent, and efficient exchange of information between the Registry and overseas registries.

• “(3) The purpose of the Registry in relation to all units is to facilitate the exchange of information between those persons with functions, duties, and powers under this Act to enable all of them to carry out perform their functions and duties, and exercise their powers.”

• “(1A) The Registrar may, subject to regulations made under this Part, allocate a unique serial number to—

  • “(i) a New Zealand unit; or

  • “(ii) an approved overseas unit; or

  • “(iii) a class or subclass of New Zealand units; or

  • “(iv) a class or subclass of approved overseas units.”

• “(1) Despite anything in this Act, the Registrar may not transfer or cancel Kyoto units if the transfer or cancellation would cause the total of the Kyoto units in all holding accounts and the retirement account in the unit register, excluding those Kyoto units subject to a notification from the international transaction log under section 21(3), to fall below the commitment period reserve.”

• “(a) indivisible with respect to the issue, holding, transfer, retirement, replacement, surrender, carry over carry-over, cancellation, and conversion of a unit within the unit register; and”.

• “(6) For the purposes of subsection (2)(b)(i), reasonable notice means sufficient opportunity in the circumstances to—

  • “(a) transfer the units to another account before the holding account that is the subject of the closure direction is closed; or

  • “(b) in the case of non-compliance, comply with this Part or any regulations made under section 30G; or

  • “(c) if the chief executive is satisfied that an account holder no longer requires a holding account, make a written submission to the chief executive, before the account is closed, regarding the account holder’s need to retain the account.”

“18CA Effect of surrender, retirement, cancellation, and conversion

• “(1) A unit that is transferred to a cancellation account may not be further transferred, retired, surrendered, carried over carried-over, or cancelled.

  “(2) A Kyoto unit that is transferred to a retirement account may not be further transferred, retired, surrendered, carried over carried-over, or cancelled.

  “(3) A Kyoto unit that is transferred to a surrender account may only be further transferred, in accordance with a direction from the Minister of Finance, to—

  • “(a) a retirement account or a cancellation account; or

  • “(b) a participant’s holding account, if the direction was given on receipt of a notice from the chief executive under section 112 (which relates to reimbursement of Kyoto units).

  “(4) A New Zealand unit or an approved overseas unit that is transferred to a surrender account may be further transferred only in accordance with a direction from the Minister of Finance given on receipt of a notice from the chief executive under section 112 (which relates to reimbursement of New Zealand units or approved overseas units).

  “(5) A New Zealand unit that is transferred to a conversion account may not be surrendered, cancelled, or otherwise further transferred except as required by section 30E(4)(c).

“18CB Restriction on the surrender of assigned amount units

• “(1) No participant may surrender, or permit to be surrendered, a CP1 imported assigned amount unit to meet the participant’s obligations under section 63 in respect of any emissions from any activities listed in Schedule 3 or 4 carried out by the participant after 31 December 2012.

  “(2) If at any time the Registrar discovers that a CP1 imported assigned amount unit has been transferred into a surrender account to meet a participant’s obligations under section 63 in respect of any emissions from any activities listed in Schedule 3 or 4 carried out by the participant after 31 December 2012, the Registrar must—

  • “(a) reverse the transfer; and

  • “(b) notify the participant and the chief executive responsible for Part 4 that the transfer has been reversed.

  “(3) If a transfer that is reversed under subsection (2) means that a participant has not surrendered the number of units by the due date as required under any section of this Act, the chief executive responsible for Part 4 may give a notice to the participant under section 121(3)(a).

  “(4) In this section and section 19, CP1 imported assigned amount unit means an assigned amount unit that is issued out of the initial assigned amount of a Party, other than New Zealand, during the first commitment period.

“18CB Restriction on surrender of assigned amount units

• “(1) No participant may surrender, or permit to be surrendered, an imported assigned amount unit to meet the participant’s obligations under section 63 unless the assigned amount unit meets the conditions or requirements prescribed in regulations made under this Part.

  “(2) In this section and section 18CD, imported assigned amount unit means an assigned amount unit that is issued out of the initial assigned amount of a Party other than New Zealand.

“18CC Restriction on surrender of assigned amount units issued during first commitment period

• “(1) No participant may surrender, or permit to be surrendered, a CP1 imported assigned amount unit to meet the participant’s obligations under section 63 in respect of any emissions from any activities listed in Schedule 3 or 4 carried out by the participant after 31 December 2012.

  “(2) In this section and sections 18CD and 19, CP1 imported assigned amount unit means an assigned amount unit that is issued out of the initial assigned amount of a Party, other than New Zealand, during the first commitment period.

“18CD Effect of surrendering restricted assigned amount units

• “(1) This section applies if at any time the Registrar discovers that—

  • “(a) an imported assigned amount unit has been transferred to a surrender account that does not meet any of the conditions or requirements prescribed in regulations made under this Part; or

  • “(b) a CP1 imported assigned amount unit has been transferred to a surrender account to meet a participant’s obligations under section 63 in respect of any emissions from any activities listed in Schedule 3 or 4 carried out by the participant after 31 December 2012.

  “(2) If this section applies, the Registrar must—

  • “(a) reverse the transfer; and

  • “(b) notify the participant and the chief executive of the department responsible for the administration of Part 4 that the transfer has been reversed.

  “(3) If a transfer is reversed under subsection (2),—

  • “(a) the chief executive of the department responsible for the administration of Part 4 must treat the transfer as never taking place for the purpose of assessing whether a participant has surrendered the required number of units by the due date as required under any section of this Act; and

  • “(b) if the chief executive of the department responsible for the administration of Part 4 considers that the person has not surrendered the required number of units by the due date, give a notice to the participant under section 121(3)(a).”

“19 Retirement of Kyoto units by the Crown

• “(1) The Crown may offset each tonne of carbon dioxide equivalent of human-induced greenhouse gas emissions, emitted from sources listed in Annex A of the Protocol, by transferring a Kyoto unit to the retirement account.

  “(1A) Despite subsection (1), the Crown may not retire a CP1 imported assigned amount unit to offset any carbon dioxide equivalent of human-induced greenhouse gas emissions that are emitted from sources listed in Annex A of the Protocol after 31 December 2012 after 31 December 2012 from sources listed in Annex A of the Protocol.

  “(2) New Zealand units and approved overseas units may not be retired.”

• “(b) if the proposed transaction concerns the international transaction log, send a record of the proposed transaction to the international transaction log if required to do so by the international transaction log; and

• “(c) if the proposed transaction does not concern the international transaction log,—

  • “(i) record in the unit register the particulars of the transaction set out in the direction or the application; and

  • “(ii) send electronic notification that the transaction has been recorded in the unit register to,—

    • “(A) in the case of a direction, the Minister of Finance and, if the direction specifies that Kyoto units are to be transferred to a holding account of an account holder other than the Crown, the account holder:

    • “(B) in the case of an application, the account holder who submitted the application and the account holder specified in the application as the account holder to whose holding account Kyoto units are to be transferred.”

• “(2) If the Registrar sends a record of the proposed transaction to the international transaction log under subsection (1)(b) and receives notification back from the international transaction log that there are no discrepancies in the transaction, the Registrar must, as soon as practicable,—

  • “(a) record in the unit register the particulars of the transaction set out in the direction or the application; and

  • “(b) send notification that the transaction has been recorded in the unit register to the international transaction log; and

  • “(c) send electronic notification that the transaction has been recorded in the unit register to—

    • “(i) the Minister of Finance, in the case of a direction; or

    • “(ii) the account holder, in the case of an application.

  • “(c) send electronic notification that the transaction has been recorded in the unit register to,—

    • “(i) in the case of a direction, the Minister of Finance; or

    • “(ii) in the case of an application, the account holder.”

• “(c) must give notification of the termination, as soon as practicable, to the international transaction log; and

• “(d) send electronic notification that the transaction has been terminated to—

  • “(i) the Minister of Finance, in the case of a direction; or

  • “(ii) the account holder, in the case of an application.

• “(d) send electronic notification that the transaction has been terminated to,—

  • “(i) in the case of a direction, the Minister of Finance; or

  • “(ii) in the case of an application, the account holder.”

“21AA Registration procedure for New Zealand units and approved overseas units

• “(1) On receipt of a direction in relation to New Zealand units or approved overseas units given by the Minister of Finance, or an application for the registration of a transaction in relation to New Zealand units or approved overseas units by an account holder, which is completed to the satisfaction of the Registrar and in accordance with any regulations made under this Act, the Registrar must—

  • “(a) create a unique transaction number; and

  • “(b) if the proposed transaction concerns an overseas registry, send a record of the proposed transaction to the overseas registry if required to do so by the overseas registry; and

  • “(c) if the proposed transaction does not concern an overseas registry,—

    • “(i) record in the unit register the particulars of the transaction set out in the direction or the application; and

    • “(ii) send electronic notification that the transaction has been recorded in the unit register to,—

      • “(A) in the case of a direction, the Minister of Finance and, if the direction specifies that New Zealand units or approved overseas units are to be transferred to the holding account of an account holder other than the Crown, the account holder:

      • “(B) in the case of an application, the account holder who submitted the application and the account holder specified in the application as the account holder to whose holding account New Zealand units or approved overseas units are to be transferred.

  “(2) If the Registrar sends a record of the proposed transaction to an overseas registry under subsection (1)(b) and receives notification back from the overseas registry that there are no discrepancies in the transaction, the Registrar must, as soon as practicable,—

  • “(a) record in the unit register the particulars of the transaction set out in the direction or the application; and

  • “(b) send notification to the overseas registry that the transaction has been recorded in the unit register; and

  • “(c) send electronic notification that the transaction has been recorded in the unit register to—

    • “(i) the Minister of Finance, in the case of a direction; or

    • “(ii) the account holder, in the case of an application.

  • “(c) send electronic notification that the transaction has been recorded in the unit register to,—

    • “(i) in the case of a direction, the Minister of Finance; or

    • “(ii) in the case of an application, the account holder.

  “(3) If the Registrar receives a notification from the overseas registry that there is a discrepancy in a proposed transaction in relation to New Zealand units or approved overseas units, the Registrar—

  • “(a) may not register the transaction; and

  • “(b) must terminate the transaction; and

  • “(c) must notify the overseas registry of the termination; and

  • “(d) send electronic notification that the transaction has been terminated to—

    • “(i) the Minister of Finance, in the case of a direction; or

    • “(ii) the account holder, in the case of an application.

  • “(d) send electronic notification that the transaction has been terminated to,—

    • “(i) in the case of a direction, the Minister of Finance; or

    • “(ii) in the case of an application, the account holder.”

“23A Receiving New Zealand units and approved overseas units from overseas registries

• “(1) If the Registrar receives notification from an overseas registry of a proposal to transfer New Zealand units or approved overseas units to an account in the Registry and the Registrar is satisfied that there is no discrepancy with the transaction, the Registrar must register the transaction in accordance with the notification.

  “(2) If the Registrar receives notification from an overseas registry of a proposal to transfer New Zealand units or approved overseas units to an account in the Registry and the Registrar is satisfied that there is a discrepancy with the transaction, the Registrar—

  • “(a) may not register the transaction; and

  • “(b) must terminate the transaction; and

  • “(c) must notify the overseas registry of the termination.

  “(3) A transfer of New Zealand units or approved overseas units from an overseas registry is subject to any regulations made under this Act.”

• “(1) A direction given by the Minister of Finance or an application for the registration of a transaction by an account holder must, as soon as practicable, be processed in the chronological order in which it is received by the Registrar.”

• “(3) Subsection (1) applies to an application for the registration of a transaction only if the application is completed to the satisfaction of the Registrar and in accordance with any regulations made under this Act.”

• “(1) If the unit register records a transaction inaccurately, and the inaccuracy is the result of an error or omission made by the Registrar when registering the transaction, then a request to correct the inaccuracy may be submitted by—

  • “(a) the Minister of Finance, if the Registrar registered the transaction following receipt of a direction from the Minister of Finance; or

  • “(b) the account holder who applied to register the transaction.”

• “(ii) the international transaction log (if required to do so); and

• “(iii) an overseas registry (if required to do so).”.

• “(2) The Registrar is not required to make publicly available any information that is not listed in section 27.”

“27 Information accessible by search

• “(1) The following information must be accessible by a search of the unit register:

  • “(a) the following up-to-date information for each account:

    • “(i) the name of the account holder; and

    • “(ii) the type of account; and

    • “(iii) the account number; and

    • “(iv) the full name, mailing address, telephone number, fax number, and email address of any primary representatives of the account holder; and

  • “(b) a list of account holders; and

  • “(c) the relevant commitment period of any—

    • “(i) general cancellation account or retirement account; and

    • “(ii) long-term certified emission reduction replacement account or temporary certified emission reduction replacement account; and

  • “(d) any other information prescribed in regulations made under this Act Part.

  “(2) The following information must be made accessible by a search of the unit register, and be available by 31 January in each year, in a form that shows the relevant totals at the end of the previous year:

  • “(a) the total holdings of Kyoto units in the Registry; and

  • “(b) the total holdings of assigned amount units, emission reduction units, certified emission reduction units, long-term certified emission reduction units, temporary certified emission reduction units, and removal units in the Registry; and

  • “(c) the total quantity of New Zealand units issued during that year; and

  • “(d) the total quantity of New Zealand units transferred for each removal activity during that year; and

  • “(e) the total holdings of New Zealand units in the Registry; and

  • “(f) the total holding holdings of approved overseas units in the Registry; and

  • “(g) the total holdings of each type of approved overseas units in the Registry; and

  • “(h) the total quantity of assigned amount units issued on the basis of New Zealand’s initial assigned amount during that year; and

  • “(i) the total quantity of emission reduction units issued on the basis of a joint implementation project during that year; and

  • “(j) the following information in relation to units transferred to the Registry from overseas registries during that year:

    • “(i) the total quantity of units transferred; and

    • “(ii) the total quantity of each type of unit transferred; and

    • “(iii) the identity of the transferring overseas registries, including the total quantity of—

      • “(A) units transferred from each overseas registry; and

      • “(B) each type of unit transferred from each overseas registry; and

  • “(k) the following information in relation to units transferred from the Registry to overseas registries during that year:

    • “(i) the total quantity of units transferred; and

    • “(ii) the total quantity of each type of unit transferred; and

    • “(iii) the identity of the acquiring overseas registries, including the total quantity of—

      • “(A) units transferred to each overseas registry; and

      • “(B) each type of unit transferred to each overseas registry; and

  • “(l) the total quantity of units transferred between holding accounts in the Registry during that year; and

  • “(m) the total quantity of each type of unit transferred between holding accounts in the Registry during that year; and

  • “(n) the total quantity of removal units issued in relation to sink activities during that year; and

  • “(o) the total quantity of Kyoto units transferred to the sink cancellation account during that year; and

  • “(p) the total quantity of Kyoto units transferred to the non-compliance cancellation account during that year; and

  • “(q) the total quantity of Kyoto units transferred to the general cancellation account during that year; and

  • “(r) the total quantity of Kyoto units retired during that year; and

  • “(s) the total quantity of units surrendered during that year; and

  • “(t) the total quantity of each type of unit surrendered during that year; and

  • “(u) the total quantity of New Zealand units converted during that year; and

  • “(u) the following information in relation to New Zealand units transferred to the conversion account during that year:

    • “(i) the total quantity of New Zealand units converted; and

    • “(ii) the total quantity of New Zealand units converted for the purpose of transferring designated assigned amount units to—

      • “(A) an account in an overseas registry; or

      • “(B) the general cancellation account; and

  • “(v) the total quantity of assigned amount units, certified emission reduction units, and emission reduction units carried over carried-over from a previous commitment period during that year; and

  • “(w) the expiry date of each long-term certified emission reduction unit and each temporary certified emission reduction unit held in the Registry.

  “(3) The following information must be accessible by a search of the unit register in a form that shows the relevant totals at the beginning of the previous year:

  • “(a) the total holdings of Kyoto units in each holding account in the Registry (including any holding account held by the Crown); and

  • “(b) the total holdings of assigned amount units, emission reduction units, certified emission reduction units, long-term certified emission reduction units, temporary certified emission reduction units, and removal units in each holding account in the Registry (including any holding account held by the Crown).”

• “(ia) an overseas registry; or

• “(ib) a third party; or”.

“Miscellaneous provisions

“30E Conversion of New Zealand units into designated assigned amount units for sale overseas or cancellation

• “(1) An account holder may apply to the Registrar to convert a New Zealand unit held by that person into a designated assigned amount unit for the purpose of transferring that assigned amount unit to an account in an overseas registry.

  “(1) An account holder may apply to the Registrar to convert a New Zealand unit by that person into a designated assigned amount unit held for the purposes of transferring that assigned amount unit to—

  • “(a) an account in an overseas registry; or

  • “(b) the general cancellation account.

  “(2) An account holder who applies to convert any New Zealand units into designated assigned amount units for the purpose either purpose specified in subsection (1) must—

  • “(a) submit the prescribed form to the Registrar specifying the New Zealand units that the account holder wishes to convert; and

  • “(b) submit an application under section 18C for the transfer of an equivalent number of designated assigned amount units (into which the account holder is converting the New Zealand units) from the account holder’s account in the Registry to an account in an overseas registry; and

  • “(b) submit an application under section 18C for the transfer of an equivalent number of designated assigned amount units (into which the account holder is converting the New Zealand units) to—

    • “(i) an account in an overseas registry; or

    • “(ii) the general cancellation account; and

  • “(c) pay the prescribed fee (if any).

  “(3) Upon receipt of an application under subsection (2) the Registrar must, as soon as practicable,—

  • “(a) transfer the New Zealand units specified in the application from the account holder’s account to the conversion account; and

  • “(b) transfer to the account holder’s account an equivalent number of designated assigned amount units; and

  • “(c) register the transaction requested under subsection (2)(b).

  • “(c) subject to section 21(3), register the transaction applied for under subsection (2)(b).

  “(4) To avoid doubt, if If the Registrar receives notification from the international transaction log under section 21(3) that there are discrepancies in the transaction relating to the application submitted under subsection (2)(b), the Registrar must—

  • “(b) comply with section 21(3); and

  • “(c) reverse the transfers in subsection (3)(a) and (b).

  “(5) For the purposes of this section, designated assigned amount unit means an assigned amount unit that—

  • “(a) was issued by the Registrar on the basis of New Zealand’s initial assigned amount; and

  • “(b) is held by the Crown in a holding account other than a cancellation, retirement, or surrender account Crown holding account.

“30F Restrictions on certain New Zealand units allocated to landowners of pre-1990 forest land

• “(1) This section applies to any New Zealand units referred to in section 68(2)(b)(ii) that are allocated in accordance with an allocation plan made under section 73 that relates to those units.

  “(2) Despite anything in section 18C or 30E, the Registrar may not transfer any New Zealand units to which this section applies to a surrender account or a conversion account until—

  • “(a) 1 January 2013; or

  • “(b) any date after 1 January 2013 specified in the allocation plan made under section 73.

  • “(b) any later date specified in the allocation plan.

  “(3) If the activity listed in Part 1 of Schedule 3 is repealed, the Minister of Finance may issue a direction to the Registrar under section 7 to transfer any New Zealand units to which this section applies to a cancellation account from any holding account to a cancellation account any New Zealand units to which this section applies.

“30G Regulations relating to Part 2

• “(1) The Governor-General may, by Order in Council made on the recommendation of the Minister, make regulations for any or all of the following purposes:

  • “(a) prescribing procedures and requirements relating to any powers of the Minister of Finance under subpart 1 of this Part:

  • “(b) prescribing matters, including (but not limited to) limitations, restrictions, conditions, exemptions, requirements, or prohibitions, in respect of—

    • “(i) the transfer of units, including (but not limited to)—

      • “(A) the transfer of units from an account holder’s holding account to another an account in an overseas registry:

      • “(B) the transfer of units within the unit register:

      • “(C) the transfer of units from an overseas registry:

      • “(D) prohibitions on the transfer of units for the purposes of holding those units in an account in the Registry:

    • “(ii) the opening or closing of holding accounts:

  • “(c) prescribing matters in respect of the holding, surrender, conversion, and cancellation of units, including (but not limited to) limitations, restrictions, conditions, exemptions, requirements, procedures, or thresholds:

  • “(d) prescribing matters in respect of the carry-over of assigned amount units, certified emission reduction units, and emission reduction units, including (but not limited to) limitations, restrictions, conditions, exemptions, requirements, procedures, or thresholds:

  • “(e) prescribing procedures, requirements, and other matters in respect of the unit register and its operation, including, but not limited to, matters relating to—

    • “(i) access to the unit register:

    • “(ii) the location of the unit register:

    • “(iii) the hours of access to the unit register:

    • “(iv) the format of unique numbers to be used in the unit register:

    • “(v) the allocation of unique serial numbers to New Zealand units and approved overseas units:

    • “(vi) the exchange of data between—

      • “(A) the Registry and overseas registries:

      • “(B) the Registry and the international transactions transaction log:

    • “(vii) the registration of transactions:

    • “(viii) the form and content of the unit register:

  • “(f) prescribing matters in respect of which fees are payable under this Part, the amounts of those fees, and the procedures for payment:

  • “(g) prescribing procedures, requirements, and other matters in respect of the form, use, and manner of obtaining electronic verification statements to confirm a registration:

  • “(h) prescribing procedures, requirements, and other matters in respect of searching the unit register, including, but not limited to,—

    • “(i) the criteria by which a search may be conducted:

    • “(ii) the method of disclosure:

    • “(iii) the form of search results:

    • “(iv) the abbreviations, expansions, or symbols that may be used in search results:

  • “(i) prescribing forms and notices for the purposes of this Part:

  • “(j) prescribing, for the purpose of the definition of overseas registry, overseas registries from which and to which units may be transferred to and from accounts in the Registry:

  • “(k) prescribing the units issued by an overseas registry that may be transferred to accounts in the Registry:

  • “(l) prescribing procedures for transactions involving approved overseas units:

  • “(la) providing for prescribing matters in respect of the taking of possession of an emissions unit for the purposes of section 18(1A)(b) of the Personal Property Securities Act 1999:

  • “(m) in respect of this Part, giving effect to the terms of the Convention and the Protocol, including any decisions, rules, guidelines, principles, measures, methodologies, modalities, procedures, mechanisms, or other matters adopted, agreed on, made, or approved in accordance with the Convention or the Protocol:

  • “(n) providing for the matters that are contemplated by, or necessary for, giving full effect to this Part and for its due administration.

  “(2) Regulations made under subsection (1) may be made in respect of different units, transactions, persons, classes of units, subclasses of units, classes of transactions, or classes of persons.

  “(3) Any regulation made under subsection (1)(b)(i) or (c) does not apply to the transfer of units that are held in an account in the Registry at the time that the regulation comes into force.

  “(4) Any regulations made under subsection (1) must be consistent with the Convention and the Protocol.

“30GA Procedure for certain regulations relating to units

• “(1) Before making a recommendation under section 30G(1) relating to regulations under section section 30G(1)(b)(i), (c), (d), (j) and (k) or (k), the Minister must consult, or be satisfied that the chief executive has consulted, the persons (or representatives of those persons) that appear to the Minister or the chief executive likely to be substantially affected by any regulations made in accordance with the recommendation.

  “(2) The process for consultation must, to the extent practicable in the circumstances, include—

  • “(a) giving adequate and appropriate notice of the proposed terms of the recommendation, and of the reasons for it; and

  • “(b) the provision of a reasonable opportunity for interested persons to consider the recommendation and make submissions; and

  • “(c) adequate and appropriate consideration of submissions.

  “(3) Unless subsection (4) applies or a later date is specified in the regulations, regulations referred to in this section come into force 3 months after the date of their notification in the Gazette.

  “(4) Subsections (1) and (3) do not apply in respect of any regulations if the Minister considers it is in the national interest that they be made urgently.

  “(5) A failure to comply with this section does not affect the validity of regulations made under section 30G(1)(b)(i), (c), (d), (j), or (k).

“30H Incorporation by reference in regulations made under section 30G

• “(1) The following written material may be incorporated by reference in regulations made under section 30G:

  • “(a) decisions, rules, guidelines, principles, measures, methodologies, modalities, procedures, mechanisms, or other matters adopted, agreed on, made, or approved by any international or national organisation in accordance with the Convention or the Protocol; and

  • “(b) any standards, requirements, or recommended practices—

    • “(i) of any international or national organisation that are adopted, agreed on, made, or approved in accordance with the Convention or the Protocol:

    • “(ii) prescribed in any country or jurisdiction that are adopted, agreed on, made, or approved in accordance with the Protocol.

  “(2) Material may be incorporated by reference in regulations—

  • “(a) in whole or in part; and

  • “(b) with modifications, additions, or variations specified in the regulations.

  “(3) Material incorporated by reference in regulations has legal effect as part of the regulations.

  “(4) Sections 150 to 157 apply to material incorporated by reference into regulations under section 30G as though all references to section 148 sections 148 to 148B, 148D, and 148E were references to section 30G and all references to the chief executive were references to the Registrar.

“30I Signing false declaration with respect to regulations made under section 30G

• Every person who signs a declaration that is required under regulations made under section 30G, knowing the declaration to be false,—

  • “(a) commits an offence; and

  • “(b) is liable on conviction to a fine not exceeding $5,000.

“30J Providing false or misleading information to Registrar

• “(1) Every person who knowingly provides false or misleading information to the Registrar commits an offence, offence and is liable on conviction to a fine not exceeding,—

  • “(a) in the case of an individual, $50,000:

  • “(b) in the case of a body corporate, $200,000.

  “(2) Every person who recklessly provides false or misleading information to the Registrar commits an offence, and is liable on conviction to a fine not exceeding $2,000.”

“Part 3
“Inventory agency”.

“45A Protection of persons acting under authority of this Part

• No inspector or person called upon to assist an inspector who does an act or omits to do an act when carrying out a duty duty, performing a function, or exercising a power conferred on that person by this Part is under any civil or criminal liability in respect of that act or omission unless the person has acted or omitted to act in bad faith or without reasonable cause.”

• “(5) Regulations made under subsection (1) or (2) may be made in respect of different persons, persons or classes of persons.”

“51 Incorporation by reference in regulations made under section 50

• “(1) The following written material may be incorporated by reference in regulations made under section 50:

  • “(a) decisions, rules, guidelines, principles, measures, methodologies, modalities, procedures, mechanisms, or other matters adopted, agreed on, made, or approved by any international or national organisation in accordance with the Convention or the Protocol; and

  • “(b) any standards, requirements, or recommended practices—

    • “(i) of any international or national organisation that are adopted, agreed on, made, or approved in accordance with the Convention or the Protocol:

    • “(ii) prescribed in any country or jurisdiction that are adopted, agreed on, made, or approved in accordance with the Protocol.

  “(2) Material may be incorporated by reference in regulations—

  • “(a) in whole or in part; and

  • “(b) with modifications, additions, or variations specified in the regulations.

  “(3) Material incorporated by reference in regulations has legal effect as part of the regulations.

  “(4) Sections 150 to 157 apply to material incorporated by reference into regulations under section 50 as though all references to section 148 sections 148 to 148B, 148D, and 148E were references to section 50 and all references to the chief executive were references to the inventory agency.”

“Part  4
“New Zealand greenhouse gas emissions trading scheme

“Subpart 1—Participants

“54 Participants

• “(1) A person is a participant,—

  • “(a) in relation to respect of an activity listed in Schedule 3, if the person—

    • “(i) is required under any provision in Part 5 to be treated as the participant in relation to the activity; or

    • “(ii) in the absence of such a provision, carries out the activity.

    • “(i) is required under section 158 or 175A to be treated as the person carrying out the activity; or

    • “(ii) if subparagraph (i) does not apply, carries out the activity; and

  • “(b) in relation to an activity listed in Schedule 4, if the person—

    • “(i) carries out the activity and is registered as a participant under section 57 in relation to the activity; or

    • “(ii) becomes a participant under section 169.

    • “(i) carries out the activity, is registered as a participant under section 57 in respect of the activity, and that registration has taken effect; or

    • “(ii) becomes a participant under section 168B or 169 in respect of the activity and is not removed from the register in respect of that activity.

  “(1A) Any reference in this Part or Part 5 to a person or participant carrying out an activity must be read as referring to the person who is to be treated under section 158 or 175A as carrying out the activity, or if those sections do not apply, to the person or participant carrying out the activity.

  “(2) Subsection (1)(a) is subject to any exemption under an Order in Council made under section 60.

  “(3) A person who was a participant under subsection (1) continues to be a participant for the purposes of this Act in respect of any obligations, or entitlements under section 64, arising in relation to respect of an activity listed in Schedule 3 or 4 that the person carried out while a participant.

  “(4) The chief executive must ensure that the registers, or the information contained in the registers, kept for the purposes of section 56 and or 57 are open for public inspection, without fee, on the Internet site of the department of the chief executive, and in any other forms form that the chief executive considers appropriate.

“55 Associated persons

• “(1) This section applies if an activity listed in Schedule 3 has a threshold below or above which a person becomes a participant.

  “(2) If this section applies, persons who are associated persons are to be treated as 1 person for the purpose of determining whether the threshold is met.

  “(3) If a threshold for an activity listed in Schedule 3 is met by associated persons, each of the associated persons—

  • “(a) is to be treated as carrying out the activity for the purposes of this Act; and

  • “(b) may elect to comply with this Part and Part 5 as a—

    • “(i) participant in relation to the activity; or

    • “(ii) a person engaged in a joint activity in accordance with section 142; or

    • “(iii) a member of a consolidated group under section 137, if the associated person qualifies to be a member of a consolidated group.

“56 Registration as participant in relation to respect of activities listed in Schedule 3

• “(1) A person who carries out an activity listed in Schedule 3 must—

  • “(a) notify the chief executive that the person is a participant in respect of the activity; and

  • “(b) if the person does not already have a holding account—

    • “(i) apply to open a holding account under section 18A at the time the person notifies the chief executive under paragraph (a); and

    • “(ii) supply the account number of the holding account, or ensure that the account number of the holding account is supplied, to the chief executive within 10 working days of receiving the account number from the Registrar.

  “(2) A notice under subsection (1)(a) must—

  • “(a) be submitted to the chief executive within 20 working days of the person becoming a participant in respect of the activity; and

  • “(b) be in the prescribed form; and

  • “(c) contain—

    • “(i) the name of the person; and

    • “(ii) the details of the activity that the person carries out; and

    • “(iii) any other information that the chief executive may require; and

    • “(iv) if the person already has 1 or more holding accounts, the account number of the holding account that the person wishes to use for the purpose of section 61(1).

  “(3) The chief executive must, as soon as practicable after receiving a notice under subsection (1)(a) (1)(a),—

  • “(a) enter on a register kept by the chief executive for the purpose of this section—

    • “(i) the name of the person; and

    • “(ii) the details of the activity that the person carries out; and

  • “(b) notify the person that the person’s name and the details of the activity the person carries out have been entered on the register.

  “(4) If the chief executive receives a notice under subsection (1)(a) from a person whose name is already on the register kept in accordance with subsection (3), then the chief executive need not re-enter the person’s name on the register, but must enter next to the person’s name the details of the activity that are contained in the notice that the person carries out.

  “(4) If the chief executive receives a notice under subsection (1)(a) from a person whose name is already on the register kept in accordance with subsection (3), the chief executive need not re-enter the person’s name on the register, but must enter next to the person’s name the activity that is specified in the notice, and notify the person that the activity has been entered on the register next to the person's name.

“57 Applications to be registered as participant in relation to respect of activities listed in Schedule 4

• “(1) A person who carries out an activity listed in Schedule 4, or who will do so at the time that the person’s registration takes effect, may apply to be registered as a participant in respect of the activity by application to the chief executive in accordance with subsection (2).

  “(2) An application under subsection (1) must—

  • “(a) be in the prescribed form; and

  • “(b) be accompanied by—

    • “(i) any information that the chief executive may require; and

    • “(ii) the prescribed fee (if any); and

  • “(c) be made within the period specified if the person already has 1 or more holding accounts, if the person already has 1 or more holding accounts, contain the account number of the holding account that the person wishes to use for the purpose of section 61(1).

  “(3) Any person who does not have a holding account at the time they submit the person submits an application under subsection (1) must—

  • “(a) apply to open a holding account under section 18A within 10 working days of submitting the application at the time the person submits the application; and

  • “(b) supply the account number of the holding account to the chief executive within 10 working days of receiving an account number from the Registrar.

  “(4) Following the receipt of an application under subsection (1), the chief executive must register the person in accordance with subsections (5) and (6) if satisfied that the person—

  • “(a) in relation to respect of the activity listed in Schedule 4 specified in the application—

    • “(i) is carrying out the activity in the year in which the chief executive receives the application; or

    • “(ii) will carry out the activity in the year in which the person’s registration will take effect under in accordance with subsection (7); and

  • “(b) has met any conditions of registration in respect of the activity in this Part or Part 5.

  “(5) The chief executive registers a person by entering on a register kept by the chief executive for the purpose of this section—

  • “(aa) the name of the applicant; and

  • “(a) the details of the activity carried out by the applicant; and

  • “(b) the date from which the applicant’s registration as a participant in relation to respect of the activity will take effect under subsection (7); and in accordance with subsection (7).

  “(5A) After registering a person under subsection (5), the chief executive must notify the following persons, by a notice dated on the same day, that the person has been registered as a participant in relation to the activity and the date from which the registration will take effect—

  • “(i) the applicant; and

  • “(ii) by notice issued on the same date as the notice to the applicant, any other persons required to be notified under section 166(2)(a), 173(2)(a), 176(2)(a), or 177A(2)(a), as the case may require.

  “(5A) After registering a person under subsection (5), the chief executive must notify the following persons that the person has been registered as a participant in respect of the activity and the date from which the registration will take effect:

  • “(a) the applicant; and

  • “(b) by notice issued on the same date as the notice to the applicant, any other persons required to be notified under section 166(5)(a), 173(2)(a), 176(2)(a), or 177A(2)(a), as the case may require.

  “(6) If the chief executive receives an application under subsection (1) in relation to an activity listed in Parts 2, 3, 4, or 5 of Schedule 4, then the chief executive must register the applicant under subsection (5) within 20 working days of receiving the application, unless the chief executive requires further information from the applicant in order to satisfy him or herself that the person is carrying out the activity specified in the application, in which case the 20 working days begins from the date the person provides the information to the chief executive.

  “(6) If the chief executive receives an application under subsection (1) in respect of an activity listed in Part 2, 3, 4, or 5 of Schedule 4, then the chief executive must, within 20 working days of receiving the application,—

  • “(a) decline the application; or

  • “(b) register the applicant under subsection (5), unless the chief executive requires further information from the applicant in order to satisfy himself or herself that the person is carrying out the activity specified in the application, in which case the chief executive must either register the person within 20 working days of receiving the further information or decline the application.

  “(7) The registration of a person takes effect from the date the person’s name is entered onto on the register under subsection (5) or such later date as is required by sections 173(2)(b), 176(2)(b) any later date required by section 173(2)(b), 176(2)(b), or 177A(2)(b).

  “(8) If the chief executive receives an application under subsection (1) from a person whose name is already on the register kept in accordance with subsection (5), and registers the person in respect of the activity specified in the application, the chief executive need not re-enter the person’s name on the register, but must enter next to the person’s name the details of the activity in respect of which the person is registered that are contained in the application. activity that is specified in the application, and notify the person that the activity has been entered on the register next to the person's name.

“58 Removal from register of participants in relation to respect of activities listed in Schedule 4

• “(1) A person who is registered under section 57 as a participant in relation to respect of an activity listed in Schedule 4 may apply to have that person’s name removed from the register in relation to respect of the activity by application to the chief executive in accordance with subsection (2).

  “(2) An application under subsection (1) must—

  • “(a) be in the prescribed form; and

  • “(b) be accompanied by the prescribed fee (if any).

  “(3) Following receipt of an application under subsection (1), the chief executive must—

  • “(a) note on the register—

    • “(i) that the applicant has applied to be removed from the register as a participant in relation to respect of the activity; and

    • “(ii) the date on which the applicant’s name is to be removed in accordance with subsection (4); and

  • “(b) notify the applicant of the date on which the applicant’s name is to be was, or is to be, removed from the register in accordance with subsection (4); and

  • “(c) notify, by notice issued on the same date as the notice to the applicant under paragraph (b), any other persons required to be notified under section 166(6)(a)(i), 173(3)(a), 176(3)(a), or 177A(3)(a), as the case may require,—

    • “(i) that the applicant has applied to have the applicant’s name removed from the register as a participant in relation to respect of the activity; and

    • “(ii) the date that the applicant’s name will be was, or is to be, removed in accordance with subsection (4).

  “(4) The chief executive must remove the name of an applicant under subsection (1) from the register in relation to respect of the activity specified in the application immediately or on any later date if required by sections section 166(6)(a)(ii), 173(3)(b), 176(3)(b), or 177A(3)(b).

“59 Removal from register of participants in relation to respect of activities listed in Schedules 3 and 4

• “(1) A person who is registered under section 56 or 57 in respect of an activity listed in Schedule 3 or 4 must notify the chief executive as soon as practicable if the person ceases, or will cease, to carry out the activity.

  “(2) The chief executive must, after receiving notice under subsection (1), or otherwise being satisfied that the person has ceased to carry out the activity,—

  • “(a) remove the name of the person from the register in relation to respect of the activity immediately or, if the notice specifies that the person will cease the activity on a future date, on that date; and

  • “(c) notify any persons specified in sections 166(6)(a)(ii), 173(3)(b), 176(3)(b), or 177A(3)(b) the person, and any other person specified in section 166(6)(a)(i), 173(3)(a), 176(3)(a), or 177A(3)(a), as the case may require, that the person’s name—

    • “(i) has been removed from the register in relation to respect of the activity; or

    • “(ii) if the person’s name will be removed from the register in relation to respect of the activity on a future date, that the person’s name will be removed from the register in relation to respect of the activity on that date.

  “(3) This section is subject to sections 173B, 176B, or and 177C.

“60 Exemptions in relation to respect of activities listed in Schedule 3

• “(1) The Governor-General may, by Order in Council made on the recommendation of the Minister, exempt any person or class of persons carrying out an activity listed in Schedule 3 from being a participant under this Act in relation to respect of—

  • “(a) an activity; or

  • “(b) part of an activity; or

  • “(c) a proportion of the emissions from an activity; or

  • “(d) a combination of the matters specified in paragraphs (a) to (c).

  “(2) Before recommending the making of an order under subsection (1), the Minister must be satisfied that—

  • “(a) the order will not materially undermine the environmental integrity of the greenhouse gas emissions trading scheme established under this Act; and

  • “(b) the costs of making the order do not exceed the benefits of not making the order.

  “(3) In determining whether or not to recommend the making of an order under subsection (1), the Minister must have regard to the following matters:

  • “(a) the need to maintain the environmental integrity of the greenhouse gas emissions trading scheme established under this Act; and

  • “(b) the desirability of minimising any compliance and administrative costs associated with the greenhouse gas emissions trading scheme established under this Act; and

  • “(c) the relative costs of giving the exemption or not giving it, and who bears the costs; and

  • “(d) any alternatives that are available for achieving the objectives of the Minister in respect of giving the exemption; and

  • “(e) any other matters the Minister considers relevant.

  “(4) While an order made under this section is in force, any person or class of persons in respect of whom the order is made is not required to comply with the obligations imposed on participants under this Part and Part 5 in respect of the matters covered by the order.

  “(5) Before recommending the making or revocation of an order under this section, the Minister must—

  • “(a) consult with persons that the Minister considers are likely to be substantially affected by the making of the order; and

  • “(b) give those persons the opportunity to make submissions; and

  • “(c) consider those submissions.

  “(6) Despite anything in subsection (2) or (3), the Minister may make a recommendation for the making of an order under subsection (1) in respect of a person with whom the Crown has signed a negotiated greenhouse agreement if—

  • “(a) the negotiated greenhouse agreement was signed before 31 December 2005; and

  • “(b) the order relates to an activity of the person that is covered by the negotiated greenhouse agreement; and

  • “(c) the order is in force for a period not exceeding the term of the negotiated greenhouse agreement, including any extension of the term made in accordance with the agreement.

  “(7) The Minister is not required to comply with subsection (5) before recommending the making of an order under subsection (1) in respect of a person with whom the Crown has signed a negotiated greenhouse agreement.

  “(8) A failure to comply with subsection (5) does not affect the validity of any order made.

“61 Participants must have holding accounts

• “(1) A participant must have a holding account for the purpose of—

  • “(a) surrendering units as required under this Part and Part 5; and

  • “(b) receiving New Zealand units to which the participant becomes entitled under this Part or Part 5.

  “(2) Despite anything in subsection (1), a participant who did not have a holding account at the time the participant’s name was entered on a register kept for the purposes of sections 56(3) or 57(5) complies with subsection (1) if the participant complies with sections 56(1)(b) or 57(3) as the case may require.

  “(2) Despite anything in subsection (1), a person who does not have a holding account at the time the person becomes a participant complies with subsection (1) if the person complies with section 56(1)(b) or 57(3), as the case may require.

  “(3) Despite anything in this Act, the Registrar must, subject to section 18A(5), open a holding account in the name of a person—

  • “(a) who applies to open a holding account in accordance with sections section 56(1)(b) or 57(3); and

  • “(b) whose name has been entered into on a register kept for the purposes of sections 56(3) or 57(5) section 56 or 57.

“62 Monitoring of emissions and removals

• A participant must, in respect of each activity listed in Schedule 3 or 4 that is carried out by the participant in a year,—

  • “(a) collect the prescribed data or other prescribed information (which data or information must, if required under required by regulations made under this Act, be verified by a person or organisation recognised by the chief executive under section 81); and

  • “(b) calculate the emissions and the removals from the activity in accordance with the methodologies prescribed in regulations made under this Act; and

  • “(c) if required under required by regulations made under this Act, have the calculations verified by a person or organisation recognised by the chief executive under section 81; and

  • “(d) keep records of the data or information and calculations in the prescribed format (if any).

“63 Liability to surrender units to cover emissions

• “(1) A participant is liable to surrender 1 unit for each whole tonne of emissions from each activity listed in Schedule 3 or 4 that the participant carries out,—

  • “(a) as calculated in accordance with this Act; and

  • “(b) at the times required under this Act.

  “(2) If a participant is liable to surrender units under this Act, the participant must make an application under section 18C to transfer the required number of units from the participant’s holding account to a surrender account designated by the chief executive.

“64 Entitlement to receive New Zealand units for removal activities

• “(1) A participant is entitled to receive 1 New Zealand unit for each whole tonne of removals from the participant’s removal activities, as calculated in accordance with this Act.

  “(2) If a participant is entitled to receive New Zealand units, the chief executive must notify the Minister of Finance of—

  • “(a) the number of New Zealand units to which the participant is entitled; and

  • “(b) the details of the participant’s holding account.

  “(3) As soon as practicable after receiving notification under subsection (2), the Minister of Finance must direct the Registrar to transfer the number of New Zealand units to which the participant is entitled to the participant’s holding account.

  “(4) Subject to subsection (5), if a participant submits an emissions return to the chief executive containing an assessment of the participant’s entitlement to receive New Zealand units, the chief executive must, within 20 working days of receiving the emissions return, notify the Minister of Finance under subsection (2) of the number of New Zealand units the participant is entitled to receive contained in the assessment.

  “(5) Subsection (4) does not apply if, within 20 working days of the chief executive receiving the emissions return, the chief executive or an enforcement officer has served notice on the participant under section 83 requiring the participant to provide information in respect of any matter contained in the emissions return.

“65 Annual emissions returns

• “(1) Between 1 January and 31 March in each year, a participant must submit an annual emissions return to the chief executive in respect of each of the activities listed in Schedule 3 or Parts Part 2, 3, 4, or 5 of Schedule 4 that the participant carried out in the immediately preceding year.

  “(2) The annual emissions return must, in respect of activities that the participant carried out during the period year covered by the return,—

  • “(a) record the participant’s activities; and

  • “(b) record the participant’s emissions and removals as calculated and, if required, as verified under section 62(a)and 62(b) and (c); and

  • “(c) contain an assessment of the participant’s—

    • “(i) liability to surrender units in respect of the participant’s emissions; and

    • “(ii) entitlement to receive New Zealand units for the participant’s removals; and

  • “(d) be accompanied by such other information as may be prescribed; and

  • “(da) be accompanied by the prescribed fee (if any); and

  • “(e) be signed by the participant.

  “(3) The participant must submit the annual emissions return under subsection (1) by submitting it in the prescribed manner and format.

  “(4) Following the submission of an annual emissions return under subsection (1), a participant must, by 30 April, surrender the number of units listed in the participant’s assessment under subsection (2)(c)(i).

  “(5) A participant who carries out an activity listed in Part 1 of Schedule 4 must submit emissions returns in accordance with section 167 and 168 as set out in section 167(2).

“65A Quarterly returns for other removal activities

• “(1) Despite anything in this Act, a person who is registered as a participant in relation to respect of an activity listed in Part 2 of Schedule 4 may, within 20 working days after the following dates, submit an emissions return that complies with subsection (2):

  • “(a) 31 March:

  • “(b) 30 June:

  • “(c) 30 September.

  “(2) A An emissions return referred to in subsection (1) must—

  • “(a) only relate to activities listed in Part 2 of Schedule 4 in respect of which the person is a participant; and

  • “(b) in respect of each activity covered by the return, be in respect of the period—

    • “(i) commencing on the later of—

      • “(A) the day the person became a participant in respect of the activity; or

      • “(B) the day after the end of the period covered by the participant’s last emissions return in relation to respect of the activity; and

    • “(ii) ending on a date specified in subsection (1); and

  • “(c) contain the information specified in section 65(2) in respect of the period covered by the return; and

  • “(d) be submitted in accordance with section 65(3).

  “(3) Despite anything in section 65, the annual emissions return of a participant who has submitted a return for an activity under this section in any year must cover only the part of the year not covered by a return under this section.

“66 Retention of emissions records

• “(1) A participant must keep sufficient records to enable the chief executive to verify, in respect of any year in which the participant carries or carried out an activity listed in Schedule 3 or 4,—

  • “(a) the activities carried out by the participant; and

  • “(b) the emissions and removals from those activities as calculated and, if required, as verified under section 62(a) 62(b) and (c); and

  • “(c) the participant’s assessment of the participant’s—

    • “(i) liability to surrender units; and

    • “(ii) entitlement to receive New Zealand units; and

  • “(d) any other information contained in the participant’s annual emissions return an emissions return submitted by the participant.

  “(2) The records specified in subsection (1) must—

  • “(a) include the records specified in section 62(d); and

  • “(b) in the case where they relate to an activity listed in Part 1 of Schedule 3 or 4, be retained for a period of at least 20 years after the end of the year to which they relate; and

  • “(c) in every other case, be retained for a period of at least 7 years after the end of the year to which they relate.

“Subpart 2—Issuance and allocation of New Zealand units

“66A Interpretation

• For the purposes of this subpart,—

  • “(a) eligible person means a person to whom an allocation plan provides for an allocation of New Zealand units free of charge

  • “(b) eligible land means pre-1990 forest land other than land that has been declared exempt land under section 159 or 160

  • “(c) person includes a person or class of persons, or where the context requires, a person representing a class of persons

  • “(d) draft determination means a draft determination made by the Minister under section 75(4)

  • “(e) determination means a determination made by the Minister under section 75(6A).

“66A Interpretation

• In this subpart,—

  “determination means a determination made by the Minister under section 75(7)(b)

  “draft determination means a draft determination made by the Minister under section 75(4)

  “eligible land means pre-1990 forest land other than land that has been declared to be exempt land under section 159 or 160

  “eligible person means a person who meets any requirements specified in this subpart, and in an allocation plan, for receiving an allocation of New Zealand units free of charge

  “existing determination means an existing—

  • “(a) determination; or

  • “(b) new determination

  “new determination means a determination made by the Minister under section 75B

  “person includes a person or class of persons or, if the context requires, a person representing a class of persons

  “revoked determination means an existing determination that has been revoked.

“67 Issuance of New Zealand units

• “(1) Subject to subsection (2), the Minister may, at any time, give a direction to direct the Registrar to issue New Zealand units into a Crown holding account.

  “(2) Before issuing giving a direction, the Minister must—

  • “(a) consult with the Minister of Finance; and

  • “(b) have regard to the following matters:

    • “(i) the number of units that New Zealand has received, or that the Minister expects New Zealand to receive, under any international agreement; and

    • “(ii) the ability of New Zealand to meet its international obligations (if any) New Zealand's international obligations, including any obligation to retire units equal to the number of tonnes of emissions that are emitted in New Zealand; and

    • “(iii) the proper functioning of the greenhouse gas emissions trading scheme established under this Act; and

    • “(iv) any other matters that the Minister considers relevant; and

  • “(c) if there is no subsequent commitment period specified or determined under the Protocol or no successor international agreement to the Protocol, have regard to the following matters:

    • “(i) New Zealand’s annual emissions for the 5 years (on record) prior to the year of the direction under consideration; and

    • “(ii) the report of any the most recent review completed under section 147 147(1); and

    • “(iii) New Zealand’s obligations under the Convention (if any); and

    • “(iv) New Zealand’s anticipated future international obligations.

  “(3) The Registrar must give effect to a direction given by the Minister under subsection (1).

  “(4) As soon as practicable after giving a direction under subsection (1), the Minister must publish a copy of the direction in the Gazette, make a copy of the direction accessible via the Internet site of the department of the chief executive, and present a copy of the direction to the House of Representatives, in each case accompanied by a statement setting out how the Minister has had regard to the matters specified in subsection (2)(b).

  “(4) As soon as practicable after giving a direction under subsection (1), the Minister must—

  • “(a) publish a copy of the direction in the Gazette; and

  • “(b) make a copy of the direction accessible via the Internet site of the department of the chief executive responsible for the administration of this Act; and

  • “(c) present a copy of the direction to the House of Representatives.

  “(5) The copies of the direction under subsection (4) must be accompanied by a statement setting out how the Minister has had regard to the matters specified in subsection (2)(b) and (c).

“67A Notification of intention regarding New Zealand units

• “(1) The Minister must recommend that the Governor-General make an Order in Council notifying containing notification of the Crown's intentions to issue and sell or allocate free of charge New Zealand units at least 9 months before the end of each of the following periods:

  • “(a) the first commitment period and each subsequent commitment period (if any); and

  • “(b) if there is no subsequent commitment period,—

    • “(i) the 5-year period commencing on 1 January 2013; or

    • “(ii) each subsequent 5-year period after the period specified in subparagraph (i).

  “(2) Notification The notification contained in the Order in Council made under subsection (1) must include—

  • “(a) the number of New Zealand units that will be issued under section 67; and

  • “(b) the time frames for issuance of New Zealand units under section 67; and

  • “(c) the intended time frame for any allocation of New Zealand units free of charge, or sale and method of sale for New Zealand units or the sale of New Zealand units and the method of sale.

  “(3) A report under section 147 must be presented to the House of Representatives before notification under this section is issued.

  “(4) The Minister must make a copy of the notification issued under this section accessible via the Internet site of the department of the chief executive.

  “(5) The Crown is not bound by the notification of intention to make particular decisions in relation to issuance, sale or free allocation of New Zealand units free of charge.

  “(3) A copy of the report under section 147(5) must be presented to the House of Representatives before an Order in Council may be made under this section.

  “(4) The Minister must make a copy of any Order in Council made under subsection (1) accessible via the Internet site of the department of the chief executive responsible for the administration of this Act.

  “(5) The Crown is not bound by the notification contained in any Order in Council made under subsection (1) to make any decisions in relation to the issuance, sale, or allocation free of charge of New Zealand units.

“68 Allocation in respect of pre-1990 forest land

• “(1) The Minister must exercise his or her powers and perform his or her functions under this subpart to ensure that an allocation plan that provides for the matters in this section is in force for the period from 1 January 2008 to 31 December 2021.

  “(2) The matters that an allocation plan must provide for are—

  • “(a) an allocation of New Zealand units free of charge to—

    • “(i) the landowners of eligible land; or

    • “(ii) a person identified in the allocation plan as the person required to hold any New Zealand units allocated in respect of the eligible land specified in subsection (2)(c)(i)(A); and

  • “(b) a total number of New Zealand units available for allocation under the allocation plan consisting of—

    • “(i) 21 million New Zealand units in the period from 1 January 2008 to 31 December 2012, reduced by 1 New Zealand unit for each tonne of emissions that results, or that the Minister considers is likely to result, from the activities specified in subsection (5) in that period; and

    • “(ii) 34 million New Zealand units in the period from 1 January 2013 to 31 December 2021, reduced by 1 New Zealand unit for each tonne of emissions that results, or that the Minister is satisfied will result, from the activities specified in subsection (5) in that period; and

  • “(c) an allocation of New Zealand units consisting of—

    • “(i) 18 New Zealand units for each hectare of eligible land that was Crown forest licence land on 1 January 2008 and—

      • “(A) has not been transferred to Iwi as part of a Treaty of Waitangi settlement on the date the allocation plan was issued; or

      • “(B) was transferred to Iwi as part of a Treaty of Waitangi settlement either on or after 1 January 2008; or

      • “(C) was transferred to Iwi as part of a Treaty of Waitangi settlement before 1 January 2008 and is identified in the allocation plan as eligible land in respect of which 18 New Zealand units per hectare are to be allocated:

    • “(ii) 39 New Zealand units for each hectare of eligible land that was acquired by the owner of the land—

      • “(A) after a date to be specified in the allocation plan, which must be in 2002; or

      • “(B) prior to that date, where since that date ownership of the person owning the land has changed in the manner and to the extent specified in the allocation plan:

    • “(iii) for any hectare of eligible land not specified in subparagraphs (i) or (ii), the number of New Zealand units calculated in accordance with the following formula:

      A =	B – C
      	D

      where

      A

      = the number of units for each hectare of eligible land not specified in subparagraphs (i) or (ii)

      B

      = the total number of New Zealand units available for allocation under subsection (2)(b)

      C

      = the number of New Zealand units allocated in accordance with subparagraphs (i) and (ii)

      D

      = the number of hectares of eligible land not specified in subparagraphs (i) or (ii)

  “(3) In addition to the matters in subsection (2), an allocation plan must also specify—

  • “(a) the date in 2002 required for the purposes of subsection (2)(c)(ii)(A):

  • “(b) the manner in which, and the extent to which, the ownership of the person owning eligible land must have changed for the purposes of subsection (2)(c)(ii)(B):

  • “(c) in relation to eligible land specified in subsection (2)(c)(i)(A),—

    • “(i) the person required to hold any New Zealand units allocated in respect of that land; and

    • “(ii) the structure, composition, and functions of that person; and

    • “(iii) that the person must hold those New Zealand units on trust for the future owners of the land; and

    • “(iv) the terms on which the person holds the New Zealand units.

  “(4) Despite subsection (2)(c)(i), the allocation plan may specify that landowners of Crown forest licence land transferred pursuant to Te Uri o Hau Claims Settlement Act 2002 or the Deed of Settlement between Nga Kaihautu o Te Arawa Executive Council And Her Majesty the Queen in right of New Zealand will receive a different (including a lower) allocation of New Zealand units in respect of each hectare of that land than the number specified in subsection (2)(c)(i).

  “(5) For the purposes of subsection (2)(b)(i) and (ii), the activities are—

  • “(a) deforestation on exempt land; and

  • “(b) deforestation of 2 hectares or less of pre-1990 forest land for which no obligation to surrender units is imposed under this Act.

  “(6) An allocation plan that provides for the matters in this section may—

  • “(a) provide for the New Zealand units referred to in subsection (2)(b)(ii) to be allocated at any time; and

  • “(b) specify dates before which some or all of those New Zealand units may not be surrendered or converted by any person.

  “(7) For the purposes of this section, Crown forest licence land means eligible land subject to a crown forest licence under section 14 of the Crown Forest Assets Act 1989.

“68 Allocation in respect of pre-1990 forest land

• “(1) The Minister must exercise his or her powers under this subpart to ensure that an allocation plan that provides for the matters in this section and section 72(2) is in force for the period from 1 January 2008 to 31 December 2021.

  “(2) The matters that an allocation plan must provide for are—

  • “(a) an allocation of New Zealand units free of charge to—

    • “(i) landowners, or former landowners, of eligible land who are eligible persons; or

    • “(ii) a person appointed in accordance with section 68A to hold any New Zealand units allocated in respect of the eligible land covered in paragraph (c)(i)(A); and

  • “(b) a total number of New Zealand units available for allocation free of charge under the allocation plan consisting of—

    • “(i) 21 million New Zealand units in the period from 1 January 2008 to 31 December 2012, reduced by 1 New Zealand unit for each tonne of emissions that the Minister estimates will result from the activities specified in subsection (5) in that period; and

    • “(ii) 34 million New Zealand units in the period from 1 January 2013 to 31 December 2021, reduced by 1 New Zealand unit for each tonne of emissions that the Minister estimates will result from the activities specified in subsection (5) in that period; and

  • “(c) an allocation of New Zealand units free of charge consisting of—

    • “(i) 18 New Zealand units for each hectare of eligible land that was Crown forest licence land on 1 January 2008 and—

      • “(A) will not have been transferred to iwi as part of a Treaty of Waitangi settlement by the date on which the allocation plan is issued; or

      • “(B) has been, or will have been, transferred to iwi as part of a Treaty of Waitangi settlement either on or after 1 January 2008 but before the date on which the allocation plan is issued:

    • “(ii) 39 New Zealand units for each hectare of eligible land that was transferred to the landowner, or former landowner, of the land—

      • “(A) after 31 October 2002; or

      • “(B) prior to 1 November 2002 if, since that date, ownership of any body corporate owning the land has changed in the manner and to the extent specified in the allocation plan:

    • “(iii) for any hectare of eligible land not covered in subparagraph (i) or (ii), the number of New Zealand units calculated in accordance with the following formula:

      	A=	B − C
      		D

      where

      A

      is the number of units for each hectare of eligible land not covered in subparagraph (i) or (ii)

      B

      is the total number of New Zealand units available for allocation under subsection (2)(b)

      C

      is the total number of New Zealand units to be allocated in accordance with subparagraph (i) and (ii)

      D

      is the number of hectares of eligible land not covered in subparagraph (i) or (ii).

  “(3) In addition to the matters provided for in subsection (2), an allocation plan—

  • “(a) must also specify the manner in which, and the extent to which, the ownership of any body corporate owning eligible land must have changed for the purposes of subsection (2)(c)(ii)(B); and

  • “(b) may specify, for the purposes of subsection (7), a date or event other than the settlement date upon which any or all eligible land is to be treated as transferred for the purposes of this section.

  “(4) Despite subsection (2)(c), the allocation plan must treat any Crown forest licence land transferred pursuant to the Te Uri o Hau Claims Settlement Act 2002 as if it were eligible land covered by subsection (2)(c)(iii).

  “(5) For the purposes of subsection 2(b)(i) and (ii), the activities are—

  • “(a) deforestation on exempt land; and

  • “(b) deforestation of 2 hectares or less of pre-1990 forest land for which no obligation to surrender units is imposed under this Act.

  “(6) An allocation plan that provides for the matters in this section may—

  • “(a) provide for the New Zealand units referred to in subsection (2)(b)(ii) to be allocated at any time; and

  • “(b) specify dates before which some or all of those New Zealand units may not be surrendered or converted by any person.

  “(7) For the purposes of this section, eligible land is to be treated as transferred on the settlement date, unless the allocation plan specifies another date or event upon which any or all eligible land is to be treated as transferred.

  “(8) For the purposes of this section, Crown forest licence land means eligible land subject to a Crown forestry licence under section 14 of the Crown Forest Assets Act 1989.

“68A Minister to appoint person to hold certain New Zealand units

• “(1) The Minister must, prior to making a determination in respect of eligible land covered by section 68(2)(c)(i)(A), by notice in the Gazette,—

  • “(a) appoint a person to—

    • “(i) apply for an allocation of New Zealand units in respect of the land; and

    • “(ii) hold on trust for the future owners of the land any New Zealand units allocated in respect of the land; and

  • “(b) determine—

    • “(i) the structure, composition, and functions of the person; and

    • “(ii) the terms and conditions upon which the person is to hold the New Zealand units.

  “(2) If the Minister has not appointed a person in accordance with subsection (1) prior to issuing a notice under section 75(1) inviting persons to apply for an allocation of New Zealand units under an allocation plan providing for the matters in section 68, then the Minister must, by notice in the Gazette, appoint a person to apply for an allocation of New Zealand units in respect of the land covered by section 68(2)(c)(i)(A) on behalf of the person to be appointed under subsection (1).

“69 Allocation to industry

• “(1) The Minister must exercise his or her powers and functions under this subpart to ensure that an allocation plan that provides for the matters in subsection (2) this section and section 72(2) is in force for each of the following periods—

  • “(a) the first commitment period:

  • “(b) each subsequent commitment period, but expiring no later than 31 December 2029:

  • “(c) if there is no subsequent commitment period,—

    • “(i) the 5-year period commencing on 1 January 2013; and 2013; or

    • “(ii) each subsequent 5-year period after the period specified in subparagraph (i), but expiring no later than 31 December 2029.

  “(2) The matters that an allocation plan must provide for are—

  • “(a) an allocation of New Zealand units free of charge to persons who—

    • “(i) the Minister considers are likely to be trade exposed trade-exposed; and

    • “(ii) meet any tests or thresholds that are specified in the allocation plan; and

    • “(iii) in any year or years specified in the allocation plan—

      • “(A) carry out are participants in respect of an activity listed in Part 4 of Schedule 3 or Part 4 of Schedule 4, unless the person does not face any obligations under section 63 in respect of the emissions from the activity in any year for which the allocation plan is in force or has an exemption under section 60 in respect of the activity; or

      • “(B) as a result of the obligations imposed by this Act on persons participants who carry out an activity listed in Part 3 of Schedule 3, face increased costs in respect of the persons’ person's direct use of coal, natural gas, or geothermal steam, or direct direct combustion of any used oil or waste oil for the purpose of generating electricity or industrial heat, or direct consumption of electricity: electricity; and

  • “(b) if the allocation plan is in force in any year from 1 January 2010 to 31 December 2018, a total number of New Zealand units available for allocation free of charge under the allocation plan, in each year that the allocation plan is in force, consisting of—

    • “(i) 90 New Zealand units for each 100 tonnes of emissions that the Minister is satisfied resulted from the persons specified in paragraph (a)—

      • “(A) carrying out any activity listed in Part 4 of Schedule 3 in 2005:

      • “(B) directly using any coal, natural gas, or geothermal steam in 2005:

      • “(C) directly combusting any used oil or waste oil for the purpose of generating electricity or industrial heat in 2005; and

    • “(ii) a number of New Zealand units that the Minister is satisfied is sufficient to offset 90% of—

      • “(A) the increase in the price of electricity, in each year for which the allocation plan is in force, due to the obligations imposed by this Act on persons who carry out an activity listed in Part 3 of Schedule 3 multiplied by

      • “(B) the amount of electricity directly consumed by persons specified in paragraph (a) in 2005:

    • “(ii) a number of New Zealand units that the Minister is satisfied is sufficient to compensate the persons specified in paragraph (a) for 90% of the electricity cost increase that the Minister estimates those persons would face, due to the obligation imposed by this Act on participants to surrender units, in the period for which the allocation plan is in force, as if those persons purchased and consumed the same amount of electricity per year in that period as those persons did in 2005; and

  • “(c) subject to section 71(2), if the allocation plan is in force in any year from 1 January 2019 to 31 December 2029, a reduction of the total number of New Zealand units available for allocation under the allocation plan, in each year that the allocation plan is in force, by one-twelfth of the number of New Zealand units available for allocation in the previous year:

  • “(c) if the allocation plan is in force in any year from 1 January 2019 to 31 December 2029, a total number of New Zealand units available for allocation free of charge under the allocation plan that is equal to eleven-twelfths of N in 2019, and then declining in each subsequent year at a linear rate to reach a number equal to one-twelfth of N in 2029, where N equals the total number of New Zealand units available for allocation under paragraph (b) in 2018; and

  • “(d) the matters that the Minister must have regard to when considering if a person is likely to be trade exposed, which must include (but are trade-exposed, including (but not limited to)—

    • “(i) whether the person competes with a firm or firms that operate from outside New Zealand in respect of—

      • “(A) products the person sells into the New Zealand market; or

      • “(B) products the person exports into overseas markets; and

    • “(ii) if the person does compete with firms that operate from outside New Zealand, whether the person—

      • “(A) faces higher costs in respect of the person’s emissions than the firm or firms with which the person competes face in respect of their emissions; and

      • “(B) is unable to pass-on some or all of the person’s costs due to the competition the person faces.

  “(3) If, after 31 December 2018, a person becomes eligible for an allocation of New Zealand units in accordance with an allocation plan providing for the matters in this section, the allocation plan may provide for the matters in subsection (2)(c) as if the person had been eligible for an allocation of New Zealand units in accordance with an allocation plan providing for the matters in this section that was in force in 2018.

  “(4) Nothing in subsection (3) entitles a person who becomes an eligible person after 31 December 2018 to an allocation of New Zealand units free of charge in any year before the year in which the person becomes an eligible person.

“69A Establishment of Innovation Fund

• “(1) The Minister must establish a fund (the Innovation Fund) for the purpose of facilitating deployment of innovative technology that significantly reduces or avoids, or has the potential to significantly reduce or avoid, greenhouse gas emissions from the industrial sector, or a part of the industrial sector.

  “(2) The Innovation Fund consists of the New Zealand units allocated to it in accordance with subsection (4).

  “(3) The Minister—

  • “(a) must ensure that there is an Innovation Fund for the period from 1 January 2010 to 31 December 2012; and

  • “(b) may, following the completion of a review under section 147(1), continue the Innovation Fund for—

    • “(i) any subsequent commitment period following the first commitment period; or

    • “(ii) if there is no subsequent commitment period following the first commitment period,—

      • “(A) the 5-year period commencing on 1 January 2013; or

      • “(B) any subsequent 5-year period after the period specified in subsubparagraph (A); and

  • “(c) must disestablish the Innovation Fund no later than 31 December 2029.

  “(4) An allocation plan—

  • “(a) must provide for 150,000 of the New Zealand units available for allocation under the plan in each year from 1 January 2010 to 31 December 2012 to be allocated to the Innovation Fund; and

  • “(b) may, if the Innovation Fund is continued after 31 December 2012, provide for any number of New Zealand units available for allocation under the plan to be allocated to the Innovation Fund.

  “(5) The Minister may make grants of New Zealand units from the Innovation Fund.

  “(6) Grants under subsection (5) must be made available on a contestable basis—

  • “(a) to persons who meet the requirements of section 69(2)(a)(i) and—

    • “(i) meet the requirements of section 69(2)(a)(iii), but are not receiving an allocation of New Zealand units in accordance with an allocation plan; or

    • “(ii) carry out an activity listed in Part 4 of Schedule 3 or Part 4 of Schedule 4, but are not receiving an allocation of New Zealand units in accordance with an allocation plan in respect of that activity; or

    • “(iii) face cost increases in respect of the matters referred to in section 69(2)(a)(iii)(B), but are not receiving an allocation of New Zealand units in accordance with an allocation plan in respect of those costs; and

  • “(b) in accordance with any criteria the Minister considers appropriate.

  “(7) If in any year the number of New Zealand units in the Innovation Fund are not fully granted and the Innovation Fund—

  • “(a) is to continue in the following year, the remaining New Zealand units may be granted under subsection (5) in any subsequent year in which the Innovation Fund is continued; or

  • “(b) will not be continued in the following year, the remaining New Zealand units may be made available for allocation in accordance with an allocation plan that applies in that following year.

  “(8) In this section, allocation plan means an allocation plan providing for the matters in section 69.

“69B Allocation to fishing vessel operators

• “(1) The Minister must exercise his or her powers under this subpart to ensure that an allocation plan that provides for the matters in this section and section 72(2) is in force for the period from 1 January 2011 to 31 December 2013.

  “(2) The matters that an allocation plan must provide for are—

  • “(a) an allocation of New Zealand units free of charge to persons who—

    • “(i) are or were fishing vessel operators in any year or years specified in the allocation plan; and

    • “(ii) meet any tests or thresholds that are specified in the allocation plan; and

  • “(b) a total number of New Zealand units available for allocation under the allocation plan calculated in accordance with the following formula:

    A = 0.5 × B × 3

    where—

    A

    is the total number of New Zealand units available for allocation under the allocation plan

    B

    is the total number of tonnes of emissions that the Minister is satisfied resulted in 2005 from the consumption of obligation fuel by fishing vessels—

    • (a) required to be registered under section 103 of the Fisheries Act 1996; and

    • (b) registered under that section in 2005.

  “(3) For the purposes of this section,—

  “fishing vessel has the same meaning as in section 2(1) of the Fisheries Act 1996

  “fishing vessel operator means the operator of a fishing vessel that is required to be registered under section 103 of the Fisheries Act 1996

  “operator, in relation to a fishing vessel, means the person who, by virtue of ownership, a lease, a sublease, a charter, a subcharter, or otherwise, for the time being has lawful possession and control of the fishing vessel.

“70 Allocation to agriculture

• “(1) The Minister must exercise his or her powers and perform his or her functions this section and section 72(2) under this subpart to ensure that an allocation plan that provides for the matters in subsection (2) this section and section 72(2) is in force for each of the following periods—

  • “(a) the subsequent commitment period following the first commitment period (the second commitment period):

  • “(b) each subsequent commitment period following the second commitment period, but expiring no later than 31 December 2029:

  • “(c) if there is no second commitment period,—

    • “(i) the 5-year period commencing on 1 January 2013; and 2013; or

    • “(ii) each subsequent 5-year period after the period specified in subparagraph (i), but expiring no later than 31 December 2029.

  “(2) The matters that an allocation plan must provide for are—

  • “(a) an allocation of New Zealand units free of charge to—

    • “(i) persons who, in any year or years specified in the allocation plan—

      • “(A) carry out an activity listed in Part 5 of Schedule 3, unless the person has an exemption under section 60 in respect of the activity; or

      • “(B) do not carry out an activity listed in Part 5 of Schedule 3, but who—

        • “(A) farm, raise, grow, or keep ruminant animals, pigs, horses, or poultry for reward or for the purpose of trade in those animals or in animal material or animal products taken or derived from those animals; or

        • “(B) purchase, other than for on-selling, synthetic fertiliser containing nitrogen; or

    • “(i) persons who—

      • “(A) meet any tests or thresholds that are specified in the allocation plan; and

      • “(B) subject to subsection (3), in any year or years specified in the allocation plan, are participants in respect of an activity listed in Part 5 of Schedule 3 or Part 5 of Schedule 4, or are not participants in respect of an activity listed in Part 5 of Schedule 3, but who farm, raise, grow, or keep ruminant animals, pigs, horses, or poultry for reward or for the purpose of trade in those animals or in animal material or animal products taken or derived from those animals, or who purchase, other than for on-selling, synthetic fertiliser containing nitrogen; or

    • “(ii) bodies corporate or trusts representing the persons specified in subparagraph (i) (i)(B); and

  • “(b) if the allocation plan is in force in any year from 1 January 2013 to 31 December 2018, a total number of New Zealand units available for allocation free of charge under the allocation plan, in each year that the allocation plan is in force, consisting of 90 New Zealand units for each 100 tonnes of emissions that the Minister is satisfied resulted from the activities listed in Part 5 of Schedule 3 in 2005; and

  • “(c) subject to section 71(2), if the allocation plan is in force at any time from 1 January 2019 to 31 December 2029, a reduction of the total number of New Zealand units available for allocation under the allocation plan, in each year that the allocation plan is in force, by one-twelfth of the number of New Zealand units available for allocation in the previous year.

  • “(c) if the allocation plan is in force in any year from 1 January 2019 to 31 December 2029, a total number of New Zealand units available for allocation free of charge under the allocation plan that is equal to eleven-twelfths of N in 2019, and then declining in each subsequent year at a linear rate to reach a number equal to one-twelfth of N in 2029, where N equals the number of New Zealand units available for allocation under paragraph (b) in 2018.

  “(3) Despite subsection (2)(a)(i)(B), an allocation plan may only provide for an allocation of New Zealand units to one or the other, but not both, of the following persons:

  • “(a) persons who are participants in respect of an activity listed in Part 5 of Schedule 3 or Part 5 of Schedule 4; or

  • “(b) persons who are not participants in respect of an activity listed in Part 5 of Schedule 3, but who farm, raise, grow, or keep ruminant animals, pigs, horses, or poultry for reward or for the purpose of trade in those animals or in animal material or animal products taken or derived from those animals, or who purchase, other than for on-selling, synthetic fertiliser containing nitrogen.

“71 Other matters with respect to allocation plans

• “(1) An allocation plan may not provide for an allocation of New Zealand units free of charge to any person other than a person specified in sections 68 to 70.

  “(2) If, after 2018, a person becomes an eligible person under an allocation plan that provides for the matters in sections 69(2) and 70(2), the allocation plan may provide for the matters in sections 69(2)(c) and 70(2)(c) by assuming that the person has been an eligible person under the allocation plan since 2018.

  “(3) Nothing in subsection (3) entitles a person who becomes an eligible person after 2018 to an allocation of New Zealand units free of charge in any year before the year in which the person becomes an eligible person.

  “(2) Nothing in this subpart requires—

  • “(a) an allocation plan to provide for the allocation free of charge of the total number of New Zealand units available for allocation under the allocation plan; and

  • “(b) the Minister, in making a determination, to allocate the total number of New Zealand units available for allocation under an allocation plan unless required to do so by the allocation plan.

  “(3) Despite section 68(2)(a), 69(2)(a), 69B(2)(a), or 70(2)(a), a draft allocation plan, or an allocation plan,—

  • “(a) is not required to specify—

    • “(i) the identity of persons who are eligible to receive an allocation of New Zealand units; or

    • “(ii) the amount of any person’s allocation; and

  • “(b) may, in accordance with section 72(2) or 73(2)(b), specify the criteria, methodologies, and other things that the Minister must apply to make a determination specifying—

    • “(i) the identity of each eligible person; and

    • “(ii) the amount of each eligible person’s allocation.

“72 Draft allocation plans

• “(1) Before recommending that an allocation plan is be issued, the Minister must prepare a draft allocation plan.

  “(2) Every draft allocation plan must specify—

  • “(a) the period for which the allocation plan will apply; and

  • “(b) the persons who will be eligible persons under the allocation plan, including (if relevant)—

    • “(i) any matters to which the Minister will have regard when considering if a person is an eligible person; and

    • “(ii) any tests or thresholds that a person must meet in order to be an eligible person; and

  • “(b) any tests or thresholds that persons must meet to be eligible for an allocation of New Zealand units; and

  • “(c) the criteria and methodologies to be included in the allocation plan that the Minister must apply to determine (if relevant applicable)—

    • “(i) the total number of New Zealand units available for allocation under the allocation plan; and

    • “(ia) the persons who are eligible for an allocation of New Zealand units; and

    • “(ii) the total number of New Zealand units allocated under the allocation plan to each eligible person; and

    • “(iii) the year or years in which each eligible person will receive the allocation of New Zealand units allocated to them; and

  • “(d) the principal reasons for the inclusion of the criteria and methodologies to be included in the allocation plan, including with reference to—

    • “(i) the matters specified in section 74, if the allocation plan provides for the matters specified in sections 69 or 70; and

    • “(ii) any relevant recommendations of a review completed under section 147; and

    • “(i) where the allocation plan will provide for the matters specified in sections 69 or 70, the general principles specified in section 74; and

    • “(ii) where a review has been completed under section 147(1), any relevant recommendations of the most recently completed review; and

  • “(e) the data and information, or the kind of data and information, that each eligible person must supply supply, and the form in which the person must supply the data and information, in order to—

    • “(i) receive an allocation of New Zealand units free of charge; and

    • “(ii) enable the Minister to verify that the person received the correct allocation of New Zealand units free of charge under the allocation plan; and

  • “(ea) in relation to an eligible person who receives an allocation of New Zealand units,—

    • “(i) the records, or the kind of records, that the person must retain; and

    • “(ii) the form in which the person must retain the records; and

    • “(iii) the period for which the person must retain the records; and

  • “(f) the policies, procedures, and provisions to be applied by the Minister under the allocation plan.

  “(3) The Minister must ensure that—

  • “(a) public notice is given of the any draft allocation plan; and

  • “(b) the draft allocation plan is made available in hard copy at the office of, and is accessible via the Internet site of the department of department of, the chief executive responsible for the administration of the Act and at such other places as the Minister considers appropriate.

  “(4) The notice of a draft allocation plan given under subsection (3) must specify—

  • “(a) where the draft allocation plan is available; and

  • “(a) how a hard copy of the draft allocation plan may be obtained; and

  • “(b) that any person may make a submission on the draft allocation plan, how submissions may be made, and by what date (which must be no earlier than 40 working days after the date on which notice is given).

  “(5) The notice of a draft allocation plan given under subsection (3) may contain a request for the persons who the draft allocation plan specifies will be eligible persons to provide to the Minister the data and information specified in the draft allocation plan in accordance with subsection (2)(e).

  “(6) Any notice given under subsection (3) that contains a request provided for in subsection (5) must specify that—

  • “(a) the data and information are requested by a date contained in the notice; and

  • “(b) compliance with the request is voluntary; and

  • “(c) any failure to comply with the request will not affect the person’s ability to receive an allocation of New Zealand units free of charge under the allocation plan; and

  • “(d) the data and information are requested in order to assist the Minister to determine—

    • “(i) who will be eligible persons under the allocation plan; and

    • “(ii) the total number of New Zealand units to be available for allocation under the allocation plan; and

    • “(iii) the number of New Zealand units to be allocated under the allocation plan to each eligible person; and

    • “(iv) the year or years in which each person is to receive the allocation of New Zealand units; and

  • “(e) any data and information that the person supplies is subject to the Official Information Act 1982.

  “(7) If any submission is made on the draft allocation plan under subsection (4), the chief executive responsible for the administration of this Act must, after the expiry of the time for making submissions, prepare for the Minister a report and that contains recommendations in respect of all the submissions.

  “(8) The Minister must consider the report and recommendations made under subsection (5) and may make any changes to the draft allocation plan that the Minister thinks fit.

  “(9) After considering the report and recommendations made under subsection (5), the Minister must ensure that—

  • “(a) notice is given of the recommendations and the Minister’s decision on the recommendations to every person who—

    • “(i) made a submission; or

    • “(ii) responded to any subsection (5) request contained in a notice given under subsection (3); and

  • “(b) public notice is given of the draft allocation plan incorporating any changes made under subsection (6).

“73 Governor-General may issue allocation plans

• “(1) The Governor-General may, by Order in Council made on the recommendation of the Minister, issue an allocation plan.

  “(2) The Minister must not make a recommendation under subsection (1) before—

  • “(a) the time for making submissions under section 72(4) has expired; or

  • “(b) if any submissions are received under section 72(5), giving notice under section 72(7).

  “(3) Subject to subsection (4), an allocation plan issued under subsection (1) may not be revoked or replaced before the end of the period for which it is in force.

  “(4) For the purpose of correcting any minor mistakes or defects in an allocation plan, the Minister may, without complying with section 73, recommend that the Governor-General issue a replacement allocation plan by an Order-in-Council that corrects any minor mistakes or defects.

  “(5) The Minister must, as soon as practicable after an allocation plan or replacement allocation plan is issued under subsections (1) or (4), ensure that—

  • “(a) the allocation plan or replacement allocation plan is made—

    • “(i) available for inspection at the office of the chief executive responsible for the administration of the Act; and

    • “(ii) accessible via the Internet site of the department of the chief executive responsible for the administration of the Act; and

  • “(b) the allocation plan or replacement allocation plan is published in what other form the Minister considers appropriate; and

  • “(c) in respect of a replacement allocation plan—

    • “(i) a summary of the corrections is made accessible via the Internet site of the department of the chief executive responsible for the administration of the Act; and

      • “(A) if the corrections concern particular persons, those persons are notified of the corrections and of where they can obtain a replacement allocation plan; or

      • “(B) if the corrections do not affect particular individuals or firms, a summary of the corrections is publicly notified.

  “(6) An allocation plan or replacement allocation plan is a regulation for the purposes of the Regulations (Disallowance) Act 1989, but it is not a regulation for the purposes of the Acts and Regulations Publication Act 1989.

  “(2) The allocation plan must—

  • “(a) specify the matters set out in section 72(2); and

  • “(b) incorporate any changes made to the draft allocation plan under section 72(8); and

  • “(c) be presented the House of Representatives as soon as practicable after it is issued, along with the report provided to the Minister under section 72(7) and any of the Minister’s decisions on the recommendations contained in the report.

  “(3) An allocation plan providing for the matters in—

  • “(a) section 68 comes into force on the day after it is presented to the House of Representatives:

  • “(b) section 69, 69B, or 70 comes into force 15 sitting days after it is presented to the House of Representatives unless the House resolves, in that period, to disapply the allocation plan.

  “(4) If Parliament is dissolved or expires before the end of the period of sitting days within which the House of Representatives must resolve to disapply an allocation plan under subsection (3)(b), and the House has not, by that time, resolved to disapply the allocation plan, then the allocation plan comes into force on the day the House is dissolved or expires.

“73A Correction and publication of allocation plans

• “(1) For the purpose of correcting any minor mistakes or defects in an allocation plan, the Minister may, without complying with section 72, recommend that the Governor-General revoke that allocation plan and replace it with a corrected allocation plan.

  “(2) A corrected allocation plan—

  • “(a) comes into force at the time it is issued; and

  • “(b) must, for advisory purposes, be presented to the House of Representatives as soon as practicable after it is issued; and

  • “(c) to avoid doubt, may not be disapplied by the House of Representatives under section 73(3)(b).

  “(3) The Minister must, as soon as practicable after an allocation plan or a corrected allocation plan comes into force, ensure that—

  • “(a) the allocation plan or corrected allocation plan is made available in hard copy at the office of, and is accessible via the Internet site of, the department of the chief executive responsible for the administration of the Act; and

  • “(b) the allocation plan or corrected allocation plan is published in whatever other form the Minister considers appropriate; and

  • “(c) in respect of an allocation plan, the report provided to the Minister under section 72(7) is published in whatever form the Minister considers appropriate, along with any of the Minister’s decisions on the recommendations contained in the report; and

  • “(d) in respect of a corrected allocation plan, a summary of the corrections is made available in hard copy at the office of, and is accessible via the Internet site of the department of, the chief executive responsible for the administration of the Act.

  “(4) An allocation plan or corrected allocation plan is a regulation for the purposes of the Regulations (Disallowance) Act 1989, but it is not a regulation for the purposes of the Acts and Regulations Publication Act 1989.

“74 Content of criteria and methodologies in allocation plans

• The Minister must, when preparing considering the criteria and methodologies to be included in any draft allocation plan or allocation plan providing for the matters contained in sections 70 and 71 69 and 70, have regard to the following general principles—

  • “(a) the allocation of New Zealand units free of charge under any allocation plan should lead to the avoidance of—

    • “(i) economic regrets:

    • “(ii) significant, regionally-concentrated job losses:

    • “(iii) perverse behavioural incentives, including with respect to decisions about investment and output levels:

  • “(b) it is desirable to treat firms or individuals who are intending to begin operating within a sector or industry (new entrants) in a similar manner, with respect to the allocation of New Zealand units free of charge under any allocation plan, as firms or individuals who are already operating within that sector or industry (incumbents) and who are intending to grow their operations:

  • “(c) criteria and methodologies should be included in an allocation plan that provide as much certainty as practicable about the number of New Zealand units to be allocated free of charge under the allocation plan and the number to be allocated to each person eligible for an allocation under the allocation plan:

  • “(d) it is desirable to treat firms or individuals that are in the same sector or industry in a similar manner with respect to any allocation of New Zealand units free of charge if the firms or individuals have a similar degree of trade exposure:

  • “(e) the application of any criteria or methodologies included in an allocation plan, and the application of the allocation plan more generally, should minimise administrative and compliance costs as much as practicable:

  • “(ea) criteria and methodologies to be included in an allocation plan should ensure that firms and individuals considered to be trade-exposed only receive New Zealand units free of charge in respect of the parts of their business operations that are involved in the production of goods that are trade-exposed:

  • “(f) any other general principles that the Minister considers appropriate.

“75 Allocation in accordance with allocation plan

• “(1) As soon as practicable after an allocation plan is issued, the Minister must give public notice requiring eligible persons to supply the data and information that the allocation plan specifies eligible persons must supply in order to receive an allocation of New Zealand units free of charge.

  “(2) The Minister must ensure that a notice given under subsection (1) specifies—

  • “(a) how the data and information are to be supplied to the Minister; and

  • “(b) the date by which the data and information are sought (which must be no later than 40 working days after the day on which notice is given); and

  • “(c) that the data and information supplied is subject to the Official Information Act 1982.

  “(3) Despite anything in this subpart, or in any allocation plan, an eligible person to whom a notice given under subsection (1) relates may not receive an allocation of New Zealand units free of charge under any applicable allocation plan until they have complied with the notice.

  “(4) Following the expiry of the time specified in a notice given under subsection (1) as the time by which data and information are sought, the Minister must apply the criteria and methodologies in the allocation plan to make the following draft determinations—

  • “(a) the identity of each eligible person; and

  • “(b) the total number of New Zealand units available for allocation under the allocation plan; and

  • “(c) the total number of New Zealand units allocated under the allocation plan to each eligible person; and

  • “(d) the year or years in which each eligible person will receive the New Zealand units allocated to them.

  “(5) After making any draft determinations, the Minister must notify—

  • “(a) each eligible person—

    • “(i) of the draft determinations:

    • “(ii) that the person has an opportunity to identify any errors, mistakes, or miscalculations that have been made in the application of the criteria and methodologies to make the draft determinations:

    • “(iii) if the person identifies any errors, mistakes, or miscalculations, that the person may provide the Minister with information concerning what the correct application of the criteria and methodologies should be to make the determinations:

    • “(iv) of the time by which the person must supply the information (which time must be no earlier than 40 working days after the date on which notice is given); and

  • “(b) any person who supplied data and information to the Minister in response to a notice given under subsection (1), who was not identified as an eligible person in the draft determinations—

    • “(i) of the basis for the Minister’s decision not to include the person as an eligible person in the draft determinations:

    • “(ii) that the person may request the Minister to reconsider if the person is an eligible person and, if so, what other determinations the Minister should make in respect of the person:

    • “(iii) that the person may provide the Minister with information concerning whether the person is an eligible person and, if so, what other determinations the Minister should make in respect of the person:

    • “(iv) of the time by which the person must make the request and supply the information (which time must be the same as the time by which persons specified in subparagraph (a) must supply any information).

  “(6) If the Minister receives any information under subsection (5), the Minister must—

  • “(a) consider the information; and

  • “(b) make any corrections or adjustments that are required; and

  • “(c) make any new determinations that are required.

  “(6A) Following the expiry of the time specified in a notice given under subsection (4), but not before complying with subsection (6) in the case where the Minister receives information under subsection (5), the Minister must—

  • “(a) publish in the Gazette the determinations that the Minister has made; and

  • “(b) make the determinations accessible via the Internet site of the department of the chief executive responsible for the administration of the Act.

  “(7) As soon as practicable after publishing any determinations under subsection (6A), the Minister must provide for the transfer of New Zealand units to eligible persons in accordance with the determinations.

“75A Minister may remake industry and agriculture determinations in accordance with allocation plan

• “(1) After making any determinations, the Minister may, in accordance with the principles, procedures, and provisions of the relevant allocation plan, remake some or all of the determinations using the procedures set out in sections 75(1) to (4) (following which any remade determination is to be treated as a draft determination).

  “(2) If any draft determination made in accordance with this section does not involve a reduction in the number of New Zealand units allocated free of charge to any person, the Minister—

  • “(a) need not provide notice of that draft determination under section 75(5); and

  • “(b) may publish it as a determination under section 75(6A).

  “(3) This section does not apply to any determinations made in accordance with an allocation plan that provides for the matters specified in section 68 (allocation to pre-1990 forest land owners).

“75B Minister may determine that correct allocations received

• “(1) At any time after an allocation plan is issued, the Minister may, in accordance with the policies, procedures, and provisions specified in the allocation plan, provide notice to any eligible person to supply the data and information that the allocation plan specifies the person must supply in order to enable the Minister to verify that the person received the correct allocation of New Zealand units free of charge.

  “(2) As long as the notice provided under subsection (1) complies with the policies, provisions, and procedures specified in the allocation plan, any person given notice must supply the information—

  • “(a) to the person specified in the notice; and

  • “(b) in the form specified in the notice; and

  • “(c) by the time specified in the notice.

  “(3) Following receipt of information provided under subsection (2), if it is shown that an eligible person did not receive the correct allocation of New Zealand units under an allocation plan, the Minister must, in accordance with the policies, procedures, and provisions specified in the allocation plan, take steps to ensure that the person receives the correct allocation (whether that involves the person receiving a total allocation of more or fewer New Zealand units).

“75 Determinations made in accordance with allocation plan

• “(1) As soon as practicable after an allocation plan is issued and is in force for a period specified in section 68(1), 69(1), 69B(1), or 70(1), the Minister must give public notice inviting any person who may be eligible for an allocation of New Zealand units under the allocation plan to apply for an allocation.

  “(2) The Minister must ensure that a notice given under subsection (1) specifies—

  • “(a) that the person must supply to the Minister the data and information, or the kind of data and information, specified in the allocation plan; and

  • “(b) how the data and information are to be supplied; and

  • “(c) the date by which the data and information must be supplied (which must be no earlier than 40 working days after the date on which notice is given); and

  • “(d) that the data and information supplied is subject to the Official Information Act 1982.

  “(3) Despite anything in this subpart, or in any allocation plan,—

  • “(a) a person must respond to a notice given under subsection (1) in order to receive an allocation of New Zealand units under any applicable allocation plan; and

  • “(b) the Minister is not under any duty to make a determination in favour of any person who fails to respond to the notice within the period specified.

  “(4) Following the expiry of the time specified in a notice given under subsection (1) for the supply of data and information, the Minister must apply the criteria and methodologies specified in the allocation plan to make a draft determination specifying—

  • “(a) the total number of New Zealand units available for allocation under the allocation plan; and

  • “(b) the identity of each eligible person; and

  • “(c) the total number of New Zealand units allocated under the allocation plan to each eligible person; and

  • “(d) the year or years in which each eligible person will receive the New Zealand units allocated to them.

  “(5) After making a draft determination, the Minister must notify each eligible person specified in the draft determination, and every person who responded to the notice given under subsection (1) who is not specified as an eligible person in the draft determination,—

  • “(a) of the draft determination; and

  • “(b) if the person is not specified in the draft determination as an eligible person, of the reasons for the person not being specified as an eligible person; and

  • “(c) that the person has an opportunity to identify any errors, mistakes, or miscalculations that have been made in the application of the criteria and methodologies to make the draft determination; and

  • “(d) if the person identifies any errors, mistakes, or miscalculations, that the person may provide the Minister with information concerning what the person considers should be the correct application of the criteria and methodologies; and

  • “(e) of the date by which the person must supply the information (which date must not be earlier than 20 working days after the date on which notice is given).

  “(6) The Minister may consult further with any person the Minister thinks fit either before or after the expiry of the period specified in subsection (5)(e) for providing information.

  “(7) Taking into account any information supplied under subsection (5), and any consultation under subsection (6), the Minister must—

  • “(a) make a new draft determination under subsection (4); or

  • “(b) make a determination of the matters specified in subsection (4).

  “(8) As soon as practicable after making a determination under subsection (7)(b), the Minister must—

  • “(a) publish the determination in the Gazette; and

  • “(b) make the determination accessible via the Internet site of the department of the chief executive responsible for the administration of this Act; and

  • “(c) provide for the transfer of New Zealand units to each eligible person in accordance with the determination.

  “(9) A determination continues in force until—

  • “(a) the allocation plan in accordance with which the determination is made expires; or

  • “(b) the determination is replaced by a new determination made in accordance with section 75B; or

  • “(c) one of the conditions in paragraph (a) or (b) is met, even if the allocation plan in accordance with which the determination is made is revoked and replaced with another allocation plan.

“75A Minister may require further information after determination made

• “(1) The Minister may, after making a determination, require the following persons to supply the records, data or information, or the kind of records, data and information, specified in the applicable allocation plan, in the form specified,—

  • “(a) persons who have been transferred New Zealand units in accordance with the determination; and

  • “(b) persons who have not been transferred New Zealand units in accordance with the determination, but who have applied to the Minister for an allocation of New Zealand units in accordance with an allocation plan; and

  • “(c) persons who have previously been transferred New Zealand units, but who are not eligible to receive a further transfer of New Zealand units, in accordance with the determination.

  “(2) Any requirement for the supply of records, data or information under subsection (1) must be made—

  • “(a) by notice to the person (which notice must specify that the records, data, or information supplied are subject to the Official Information Act 1982); and

  • “(b) in accordance with any relevant policies, procedures, and provisions specified in the applicable allocation plan.

  “(3) A person who—

  • “(a) receives a notice issued under subsection (2)(a) must supply the records, data, or information requested within the time frame specified in the notice; and

  • “(b) fails to respond within the specified time frame for supply of records, data, or information under subsection 2(a) may—

    • “(i) not receive any further allocation of New Zealand units until the person supplies the information; and

    • “(ii) commit an offence under section 118(1)(a) or 120(1)(d) as if the reference to the chief executive in those sections were to the Minister, and the reference to section 83 in section 118(1)(a) was to this section.

“75B New determination made in accordance with allocation plan

• “(1) The Minister may (but is not required to) revoke and replace any existing determination with a new determination at any time if—

  • “(a) the allocation plan under which the existing determination was made has been revoked and replaced with a new allocation plan; or

  • “(b) the existing determination has resulted, or will result, in a person receiving an incorrect allocation owing to—

    • “(i) an error in the application of the criteria and methodologies specified in the applicable allocation plan; or

    • “(ii) the person providing altered, false, incomplete, or misleading information in response to a notice given under section 75(1) or (5) in relation to the existing determination; or

  • “(c) a person who is specified as an eligible person under the existing determination is no longer an eligible person; or

  • “(d) there has been a change in the circumstances of a person who is specified as an eligible person under the existing determination that, if taken into account, would increase or decrease that person’s entitlement to an allocation; or

  • “(e) a person who is not specified as an eligible person under the existing determination has—

    • “(i) reasonable grounds to believe that he or she is an eligible person; and

    • “(ii) applied to the Minister for an allocation in accordance with the applicable allocation plan.

  “(2) However, the Minister may only make a new determination in accordance with an allocation plan that provides for the matters in section 68 if subsection (1)(a) or (b) applies.

  “(3) In making a new determination, the Minister must,—

  • “(a) if the Minister considers that he or she has sufficient information to make the new determination of the matters specified in section 75(4), comply with subsection (4); or

  • “(b) if the Minister considers that he or she does not have sufficient information to make the new determination of the matters specified in section 75(4), follow the process in section 75, except that the reference to—

    • “(i) 40 working days in section 75(2)(c) must be read as 20 working days; and

    • “(ii) 20 working days in section 75(5)(e) must be read as 10 working days.

  “(4) If subsection (3)(a) applies, the Minister must—

  • “(a) give notice of the matters specified in section 75(5) to the following persons:

    • “(i) persons specified as eligible persons under the existing determination who would, once the new determination replaces the existing determination, receive greater or fewer New Zealand units than if the new determination did not replace the existing determination; and

    • “(ii) persons not specified as eligible persons under the existing determination whom the new determination specifies as eligible persons; and

  • “(b) comply with section 75(6) to (8) as if the notice given under paragraph (a) had been given under section 75(5).

  “(5) If the Minister has provided notice of the matters specified in section 75(5) in accordance with subsection (4), the reference to 20 working days in section 75(5)(e) must be read as 10 working days.

  “(6) Any new determination made in accordance with subsection (3)—

  • “(a) may specify all of the matters specified in section 75(4), and may—

    • “(i) specify the correct allocation of a person whose allocation is specified incorrectly in the existing determination; or

    • “(ii) not specify as an eligible person a person who was specified as an eligible person under the existing determination but is no longer an eligible person; or

    • “(iii) increase or decrease a person’s allocation owing to a change in the person’s circumstances since the existing determination was made; or

    • “(iv) specify as an eligible person a person who was not specified as an eligible person under the existing determination; and

  • “(b) applies subject to section 75C.

  “(7) Despite anything in this section, the Minister may make a new determination that corrects any minor mistakes or defects in an existing determination without complying with section 75(1) to (6).

“75C Effect of new determination

• “(1) If the Minister makes a new determination in accordance with section 75B, the new determination has the effect of immediately revoking and replacing the existing determination.

  “(2) A new determination made in accordance with section 75B applies from the date it is made, and, subject to subsections (5) and (6), does not change or otherwise affect any transfer of New Zealand units made to a person in accordance with any revoked determination before that date.

  “(3) If a revoked determination incorrectly specified a person’s allocation, a new determination may increase or decrease the number of New Zealand units the person is to receive by the difference between the number of New Zealand units that the person—

  • “(a) received under the revoked determination; and

  • “(b) would have received if the revoked determination had specified the person’s correct allocation.

  “(4) If the circumstances of a person specified as an eligible person under a revoked determination changed while that determination was in force, and the person received greater or fewer New Zealand units than the person’s entitlement as a result, then a new determination may increase or decrease the number of New Zealand units the person is to rec