[Exclusive] No Penalties for Failing to Honor 'Greenhouse Gas Reduction' Promises

Post-Implementation Management of Climate Change Impact Assessments under the Carbon Neutrality Act Is Ineffective
Ministry of Government Legislation: "Environmental Impact Assessment Cannot Be Applied... Revise the Law"

A legal interpretation by the Ministry of Government Legislation has found that, under current law, companies promoting large-scale development projects cannot be penalized if they fail to fulfill greenhouse gas reduction pledges made to the government. This is because the "Climate Change Impact Assessment" system—introduced to assess the carbon emissions impact of development projects and evaluate mitigation measures—does not include post-management regulations. As there are no means to oversee or sanction companies that do not implement their reduction plans, controversy over the effectiveness of the system is expected to grow.

According to a summary of reporting by The Asia Business Daily on June 8, the Ministry of Government Legislation recently notified the Ministry of Climate, Energy and Environment that "post-management regulations under the Environmental Impact Assessment cannot be applied to the Climate Change Impact Assessment." Previously, the Ministry of Climate had requested an official interpretation, taking into account that the Climate Change Impact Assessment is operated in close connection with the existing Environmental Impact Assessment system, and asked whether post-management regulations could be applied.

While Environmental Impact Assessments focus on environmental degradation and pollution reduction in development projects, Climate Change Impact Assessments are designed to pre-review greenhouse gas mitigation and climate crisis adaptation measures. Article 23 of the current Carbon Neutrality Framework Act stipulates that when a large-scale development project undergoes an Environmental Impact Assessment, a Climate Change Impact Assessment must also be conducted. The intent is to review, within the Environmental Impact Assessment procedures, how much greenhouse gas a project will emit and how vulnerable it is to the climate crisis.

The issue is that, even if a project that has undergone a Climate Change Impact Assessment does not implement planned greenhouse gas reductions, the government currently lacks adequate means of enforcement. Since the two assessments are separate systems with different objectives, post-management regulations cannot be arbitrarily applied. The Ministry of Government Legislation stressed, "Application by analogy is only possible when explicitly stipulated in the law, but there are no such provisions in the Carbon Neutrality Framework Act," and added, "Regulations imposing disadvantages on companies, such as fines or penalties, cannot be broadly applied without a clear legal basis."

The Ministry of Government Legislation has recommended that the relevant ministries revise the law to ensure the effectiveness of the Climate Change Impact Assessment. An official from the Ministry of Climate said, "It is true that we have received a legal interpretation from the Ministry of Government Legislation stating that the relevant laws cannot be applied," and added, "During the second half of the year, we are considering measures such as applying the Environmental Impact Assessment Act’s regulations by analogy, or establishing separate rules, in order to set up a post-management system."

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