Establishing the Liabilities due to Participation in the NZETS when selling or purchasing land

The NZEUR http://www.eur.govt.nz is the register where transactions are recorded under the NZETS. We asked the NZEUR the following question:

I have been asked how a prospective purchaser of forest land that is registered in the NZETS, and can be searched on the EUR, would know how many credits had been issued, sold or surrendered for a particular title.

The point being the liability is transferred with the land and an incoming purchaser would want to know (presuming the land is registered as post 1989 forest) the credit assets and liability position at the date of purchase.

Their reply was

You are able to search the Participant Register on the EUR and you can also search by Account Holder name. Neither of these searches however will give you details of credits issued, sold or surrendered for any particular title.

There are certain transactions which are required by law to be publically viewable such as those under the Permanent Forest Sink Initiative. You can view these via the ‘Ministers Directions’ tab.

Regarding the liability with a particular land title, my understanding is that due to confidentiality it could only be disclosed by the land owner themselves.

This in our view presents real problems for those purchasers of post 1989 land that is part of the NZETS. There appears to be no source of independent certification of the assets and liabilities tied to the land as there is with the land title registry. Searching and establishing such a NZETS liability as part of a land settlement statement would be essential?

 

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One Response to Establishing the Liabilities due to Participation in the NZETS when selling or purchasing land

  1. eitg says:

    MED called us and this is some of the feedback they provided:

    In terms of your concern about assessing the ‘residual liability’ I would suggest you look at sections 192, 190, 194 and 195 of the Act.

    It is also worth noting that these matters can be dealt with as a clause within a contract (by pushing to the vendor to settle any liability). There is also the potential to de-register the vendor (section 58) and register the purchaser. The vendor would then be required to submit an emissions return and pay back any over-claimed units in respect of that period.

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