New Zealand's environment ministry is eyeing fines for failure to comply with new reporting requirements under the NZ Emissions Trading Scheme (NZ ETS), briefing papers published by the ministry this week show.
Under the penalty regime, failure to report price and volume information to the government or market monitoring entities would result in fines of NZ$8,000 ($4,621) on the first instance, doubling to NZ$16,000 in the case of a second breach. Each additional breach would carry a NZ$24,000 fine.
Those that fail to store trading information data would face first-time fines of NZ$12,000, which would double to NZ$24,000 in case of repetition. Additional infractions would be penalised NZ$32,000 per breach.
The ministry's proposal, which was put to the climate change minister in October, follows the decision to implement stronger NZ ETS platform reporting requirements, agreed by the country's cabinet earlier this year.
Additional proposals for NZ emissions units (NZUs) transacted on the secondary market would require trading platforms to keep records of trading information for seven years, and submit daily reports to the ministry with the price and volume of NZUs transacted on that day.
Under the proposals, confirmed instances of NZU price manipulation could face criminal charges, potentially resulting in imprisonment not exceeding five years, or a fine lower than NZ$2.5mn. Misleading conduct without confirmed evidence would face fines proportional to the gain made or loss avoided. But they would not exceed NZ$1mn if an individual were facing the fine, or NZ$5mn in any other case.
In addition to fines, the ministry would also publish the details of the entity committing the infraction and the status of the penalty, the briefing paper said.
The penalty regime will be incorporated into a bill amending the country's Climate Change Response Act, alongside other market governance changes. The introduction of the bill to parliament was initially scheduled for late 2025 but has now been postponed, with a first reading expected in early 2026.
