China: Environmental protection compliance progress in 2018

On the domestic political scene, “environment” has become one of the most frequent words. The 19th National Congress of the Communist Party of China put forward five major directions for national development, one of which is “beautiful”, pointing to the control of environmental pollution. At the same time, the congress report proposed “treating the environment like treating our lives” and “implementing the strictest eco-environmental protection system”.

Two environmental protection systems have been effective since the start of 2018. First, the ecological damage compensation system has been put on trial. Any enterprise or individual that illegally infringes the ecological environment is subject to tort liabilities. The government is entitled to bring ecological damage compensation alone, or in response to complaints from the public. Second, the Environmental Protection Tax Law took effect. Using “the more emission, the higher levy – the more hazard emission, the higher levy” incentive mechanism encourages enterprises to increase energy saving and emission reduction efforts.

EIA + pollutant emission permit model. Under the new environmental protection law, enterprises face stricter stipulations, from construction to pollutant emissions. Construction projects need to undergo an environmental impact assessment (EIA). At the production stage, enterprises are subject to the pollutant emission permit system.

Li Xiong is a senior partner and Yuan Yuan is a paralegal at AllBright Law Offices