Page 81 - Research on Financial Development Mechanism and Path of Forestry Carbon Sequestration in Developing Countries under Double Carbon Targets

Chapter 2 Forestry Carbon Sequestration and Carbon Finance

tation) from February 2021, this regulation only covers activities such as the payment
and allocation of national carbon emission quotas, registration, trading and settlement
of carbon emissions, and reporting and verification of greenhouse gas emissions, and
the application of these rules to the forest carbon sequestration trading market is not
specific and detailed enough. In view of the forestry carbon sequestration transaction, it
is not only necessary to formulate the basic norms of carbon sequestration transaction
to stipulate some common principles and rules for carbon sequestration transaction, but
also necessary to formulate specific legal norms to guide the forestry carbon seques-
tration transaction, and to make specific provisions on the aspects of forestry carbon
sequestration monitoring, ownership of property rights, transfer of property rights and
market supervision, etc., so as to enable China’s forestry carbon sequestration to “have
laws to depend on” in the transaction process and realize sound and rapid development
of forestry carbon sequestration under the constraint of each specific rule.

1.3.2 clear ownership of forest carbon sinks

The premise of successfully completing the forest carbon sink transaction is to
ensure the compliance of the transaction, which in turn requires that the ownership of
forest carbon sink must be clear. Because forest carbon sink relies on the material carri-
er of “forest”, it is the object that is produced in the forest and separated from the forest
after scientific measurement. It conforms to the provisions on fruits in the Property Law
of our country and can be regarded as fruits of the forest. At the same time, the right
of forest carbon sink can be occupied, used, gained and transferred, and can also be
regarded as usufructuary right. According to the Civil Code of our country, forestry car-
bon sinks should be natural fruits, which are obtained by the owner (state or collective)
in principle. When there is a usufructuary right holder, i.e. the state-owned or collective
forest land is contracted for management, the fruits at this time should be owned by the
holder of the contracted management right. If the parties have otherwise agreed, the
agreement shall prevail. Forest right and forest carbon sink property rights will com-
pete, but the forest right will not change with the transfer of carbon sink ownership.
Generally, if the forest carbon sink project is successfully traded through the MRV link,
the owner of the forest right has the obligation to ensure that the carbon sink right on
the forest floor will not be transferred or lost during its existence. In order to ensure that
the transfer of forest carbon sink property rights is legal and compliant, the property
right of forest carbon sink must be clearly materialized in the law, and the transaction
subject should be guided to make contracts or sign agreements in accordance with the

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