Permanent Forest Sink Initiative Guidelines
Forest Sink Covenant
The covenant is a contract between the landowner and the Crown. It sets out the rights and obligations of both parties.
Term of the Covenant
The covenant remains in force for at least 50 years but may be terminated earlier if:
• The landowner chooses to become a participant in the Emissions Trading Scheme (Forestry) in relation to the Forest Sink Area before 1 January 2010 (automatic termination); or
• New Zealand withdraws from the Kyoto Protocol or the Kyoto Protocol ceases to exist or be in force; or
• There is a material breach of the covenant; or
• Other grounds for termination as set out in the covenant.
The landowner is required to repay any carbon units issued for the forest upon termination, except in cases where the landowner elects to switch the Forest Sink Area from the PFSI to the Emission Trading Scheme (Forestry) within the allowed period.
Registration of Covenant
The landowner must submit an agreed covenant to the Registrar-General of Land for Registration under the Land Transfer Act 1952.
Two copies of the covenant need to be submitted to the Land Information New Zealand (LINZ) registry office for your particular district with a LINZ lodgement form and a fee of $50 either in person or by post.
For further information on the location of registry offices and lodgement forms see: www.linz.govt.nz
Allow up to 15 days for the processing of registration onto title.
Lapse of Covenant
The covenant must be registered within 180 days of being agreed. In the event that an agreed covenant is not registered within this time then the covenant will expire. A new application (and payment of the application fee) would need to be submitted if the landowner was still interested in participating in the PFSI.
Notification of Registration of Covenant
Once the covenant is registered on the title of the land, the landowner is required to notify Programmes Directorate, MAF Policy.
No obligation on the Crown to enter into a Covenant
Despite the eligibility requirements set out in this guide, nothing requires the Crown to negotiate, or enter into, any Forest Sink Covenant.
Contact for Enquiries
Permanent Forest Sink Initiative
Ministry of Agriculture and Forestry
Pastoral House
25 The Terrace
PO Box 2526, Wellington 6140
Or call us on 0800 CLIMATE (254 628)
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