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Climate Change Response (Emissions Trading Reform) Amendment Bill
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Hon James Shaw
Climate Change Response (Emissions Trading Reform) Amendment Bill
Government Bill
186—1
Contents
Explanatory note
1
Title
2
Commencement
3
Principal Act
Part 1
Amendments to principal Act
Subpart 1—Amendments that commence on day after Royal assent
4
Section 2A amended (Application of Schedules 3 and 4)
5
Section 2B amended (Orders in Council in relation to Part 5 of Schedule 3)
6
Section 2C amended (Effect of Orders in Council in relation to Part 5 of Schedule 3)
7
Section 3 amended (Purpose)
8
Section 3A amended (Treaty of Waitangi (Te Tiriti o Waitangi))
9
Section 4 amended (Interpretation)
10
New sections 4A and 4B inserted
4A
Greenhouse gas definition may be amended to add gases
4B
Transitional, savings, and related provisions
11
Section 6 amended (Minister of Finance may direct Registrar regarding establishment of Crown holding accounts and carry out trading activities with respect to units)
12
Section 6A amended (Minister’s power to sell by auction)
13
Section 7 amended (Minister of Finance may give directions to Registrar regarding accounts and units)
14
Section 9 amended (Minister of Finance may obtain information from inventory agency and Registrar)
15
Section 10 replaced (Purpose of Registry)
10
Purpose of Registry
16
Section 13 amended (Registrar may refuse access to, or suspend operation of, Registry)
17
Section 14 amended (Registrar must give effect to directions)
18
Section 15 amended (Registrar to allocate unique numbers)
19
Sections 16 and 17 repealed
20
Section 18 amended (Form and content of unit register)
21
Section 18B amended (Closing holding accounts)
22
Section 18C amended (Transfer of units)
23
Section 18CA amended (Effect of surrender, retirement, cancellation, and conversion)
24
Sections 18CB, 18CC, and 18CD repealed
25
Section 18D amended (Succession)
26
Section 19 repealed (Retirement of Kyoto units by the Crown)
27
Section 20 amended (Transactions must be registered)
28
Section 21 repealed (Registration procedure for Kyoto units)
29
Section 21AA amended (Registration procedure for New Zealand units and approved overseas units)
30
Section 21A amended (Electronic registration)
31
Section 21B amended (Defective applications)
32
Section 23 repealed (Receiving Kyoto units from overseas registries)
33
Section 23A amended (Receiving New Zealand units and approved overseas units from overseas registries)
34
Section 24 amended (Priority of registration)
35
Section 25 amended (Correction of unit register)
36
Section 27 amended (Information accessible by search)
37
Section 30A amended (The Crown or Registrar not liable in relation to searches in certain cases)
38
Sections 30B to 30D and cross-heading repealed
39
Section 30E repealed (Conversion of New Zealand units into designated assigned amount units for sale overseas or cancellation)
40
Section 30G amended (Regulations relating to Part 2)
41
Sections 30GA and 30GB replaced
30GA
Regulations for auctions to sell New Zealand units
30GB
Regulations about overall limits and price control settings for units
30GC
Requirements for regulations about overall limits and price control settings for units
30GD
Regulations for auction monitor
30GE
Sharing information with auction monitor
30GF
Obligation of confidentiality on auction monitor
30GG
Offence for breach of auction monitor’s obligation of confidentiality
42
Section 30H amended (Procedure for certain regulations relating to units)
43
Section 30I amended (Incorporation by reference in regulations made under section 30G)
44
New section 30IA inserted (Minister must obtain emission reductions to match reserve amounts of units released)
30IA
Minister must obtain emission reductions to match reserve amounts of units released
45
Section 30J amended (Signing false declaration with respect to regulations made under section 30G)
46
New subparts 3 and 4 of Part 2 inserted
Subpart 3—Infringement offences
30L
Meaning of infringement offence and infringement fee
30M
Regulations about infringement offences
30N
Procedure for regulations about infringement offences
30O
Proceedings for infringement offences
30P
Appointment of enforcement officers
30Q
When infringement notice may be issued
30R
Infringement notice may be revoked
30S
What infringement notice must contain
30T
How infringement notice may be served
30U
Payment of infringement fees
30V
Reminder notices
Subpart 4—Regulations setting price of carbon
30W
Regulations setting price of carbon
47
Section 31 amended (Meaning of greenhouse gas)
48
Section 32 amended (Primary functions of inventory agency)
49
Section 35 amended (Publication)
50
Section 36 amended (Authorisation of inspectors)
51
Section 49 amended (Reporting)
52
Section 50 amended (Regulations)
53
Section 51 amended (Incorporation by reference in regulations made under section 50)
54
Section 52 amended (Inventory agency must report to Minister on certain matters before certain regulations are made)
55
Section 53 repealed (Consequential amendments)
56
Section 54 amended (Participants)
57
Section 55 amended (Associated persons)
58
Section 56 amended (Registration as participant in respect of activities listed in Schedule 3)
59
Section 57 amended (Applicant to be registered as participant in respect of activities listed in Schedule 4)
60
Section 58 amended (Removal from register of participants in respect of activities listed in Schedule 4)
61
Section 59 amended (Removal from register of participants in respect of activities listed in Schedules 3 and 4)
62
New sections 59A and 59B inserted
59A
Removal from register for persistent non-compliance (standard forestry participants only)
59B
Removal from register if participant never carried out activity
63
Section 60 amended (Exemptions in respect of activities listed in Schedule 3)
64
New sections 60A and 60B inserted
60A
Exemption for participants in standard forestry or permanent forestry
60B
Incorporation by reference in order made under section 60 or
60A
65
Section 61 amended (Requirement to have holding account)
66
Section 62 amended (Monitoring of emissions and removals)
67
Section 63 amended (Liability to surrender units to cover emissions)
68
Section 64 amended (Entitlement to receive New Zealand units for removal activities)
69
Section 65 amended (Annual emissions returns)
70
Section 67 amended (Retention of emissions records)
71
Section 68 amended (Issuing New Zealand units)
72
Section 69 repealed (Notification of intention regarding New Zealand units)
73
Cross-heading above section 70 amended
74
Sections 70 to 79 replaced
70
Allocation plan issued
75
Section 81 amended (Entitlement to provisional allocation for eligible industrial activities)
76
Section 83 amended (Annual allocation adjustment)
77
New sections 84A to 84D inserted
84A
Regulations reducing general phase-out rate
84B
Regulations increasing phase-out rate for specific activities
84C
Procedure for regulations setting phase-out rates
84D
Climate Change Commission to advise on regulations setting phase-out rates
78
Section 85 amended (Allocation of New Zealand units in relation to agriculture)
79
Section 85A amended (Temporary suspension of phase-out rates for assistance under sections 81, 83(2), and 85(2))
80
Section 86B amended (Decisions on applications for allocations of New Zealand units to industry and agriculture)
81
New section 86BA inserted (Transfer of allocated units, less any units that must be surrendered or repaid)
86BA
Transfer of allocated units, less any units that must be surrendered or repaid
82
Section 86C amended (Reconsideration of allocation decisions)
83
Section 86E amended (Minister or EPA or chief executive may require further information for purpose of carrying out functions under subpart)
84
Section 87 amended (Functions of EPA)
85
Section 88 amended (Directions to EPA)
86
Section 89 amended (EPA to publish certain information)
87
New section 89A inserted (EPA to publish participant data on emissions and removals)
89A
EPA to publish participant data on emissions and removals
88
Section 90 amended (EPA may prescribe form of certain documents)
89
Section 91 amended (Approval of unique emissions factors)
90
New section 91A inserted (Correction of unique emissions factors)
91A
Correction of unique emissions factors
91
Section 92 amended (Recognition of verifiers)
92
Section 93 amended (Appointment of enforcement officers)
93
Section 94 amended (Power to require information)
94
Section 95 amended (Power to inquire)
95
Section 96 amended (Inquiry before District Court Judge)
96
Section 99 amended (Obligation to maintain confidentiality)
97
Section 100 amended (Power of entry for investigation)
98
Section 104 amended (Information obtained under section 100 or 101 only admissible in proceedings for alleged breach of obligations imposed under this Part and Part 5)
99
Section 107 amended (Applications for emissions rulings)
100
New section 107A inserted (Insufficient information provided for ruling on entire application)
107A
Insufficient information provided for ruling on entire application
101
Section 108 amended (Matters in relation to which EPA may decline to make emissions rulings)
102
Section 109 amended (Making of emissions rulings)
103
Section 116 amended (Effect of emissions rulings)
104
Section 117 amended (EPA may publish certain aspects of emissions rulings)
105
Section 118 amended (Submission of final emissions returns)
106
Section 120 amended (Amendment to emissions returns by EPA)
107
Section 123 amended (Effect of amendment or assessment)
108
Section 124 amended (Reimbursement of units by EPA)
109
Section 125 replaced (Repayment of units by persons in case of error)
125
Repayment of units by persons in case of error
110
Section 127 amended (Time bar for amendment of emissions returns)
111
New sections 128A and 128B and cross-heading inserted
Notices required from participants
128A
EPA may act if participant fails to give notice
128B
Effects of EPA acting after participant fails to give notice
112
Section 129 amended (Offences in relation to failure to comply with various provisions)
113
Section 132 amended (Other offences)
114
Section 133 amended (Evasion or similar offences)
115
Sections 134 to 136 replaced
134
Penalty for failing to surrender or repay units by due date
134A
Penalty for failing to submit emissions return by due date
134B
Penalty for failing to submit annual or closing allocation adjustment by due date
134C
Penalty for submitting incorrect emissions return
134D
Penalty for providing incorrect information in allocation application or adjustment
135
Due dates for payment of penalties
135A
Deferred payment arrangements for payments of penalties
136
Penalties are debt due to Crown
116
Section 137 amended (Interest for late payment)
117
Section 138 amended (Obligation to pay penalty not suspended by appeal)
118
Section 138A replaced (Penalties to be paid into Crown account)
138A
Penalties to be paid into Crown account
119
Section 143 amended (Evidence in proceedings)
120
Section 144 amended (Request for review of decisions)
121
Section 148 amended (Giving of notices to EPA)
122
Section 150 amended (Formation of consolidated group)
123
Section 151 amended (Changes to consolidated groups)
124
Section 151A amended (Addition of activities to consolidated groups)
125
Section 152 amended (Nominated entities)
126
Section 153 amended (Effect of being member of consolidated group)
127
Section 154 repealed (Emissions returns by consolidated group in respect of activities in Part 1 of Schedule 4)
128
Section 155 amended (Ceasing to be member of consolidated group)
129
Section 156 replaced (Effect of ceasing to be member of consolidated group)
156
Effect of ceasing to be member of consolidated group
130
Section 156A amended (Removal of activities from consolidated groups)
131
Section 157 amended (Unincorporated bodies)
132
Section 159 amended (Recovery of costs)
133
Section 160 amended (Review of operation of emissions trading scheme)
134
Section 161 amended (Appointment and conduct of review panel)
135
Section 161A amended (Regulations in relation to eligible industrial activities)
136
Section 161B repealed (Australian eligible industrial activities)
137
Section 161C amended (Other eligible industrial activities)
138
Section 161D amended (Power to require information for purposes of allocation to industry)
139
Section 161E amended (Requirements in respect of notice given under section 161D)
140
Section 161F amended (Consultation on activities that may be prescribed as eligible industrial activities)
141
Section 163 amended (Regulations relating to methodologies and verifiers)
142
Section 166 amended (Procedure for regulations relating to methodologies, verification, unique emissions factors, and offsetting)
143
Section 167 amended (Regulations relating to fees and charges)
144
Section 168 amended (Other regulations)
145
Section 169 amended (Incorporation by reference in regulations made under section 163, 164, 167, or 168)
146
Section 170 replaced (Effect of amendments to, or replacement of, material incorporated by reference in regulations)
170
Effect of amendments to, or replacement of, material incorporated by reference in regulations
147
Section 172 replaced (Effect of expiry of material incorporated by reference)
172
Effect of expiry of material incorporated by reference
148
Section 173 amended (Requirement to consult)
149
Section 174 amended (Public access to material incorporated by reference)
150
Section 175 amended (Application of Legislation Act 2012 to material incorporated by reference)
151
Section 178A amended (Option to pay money instead of surrendering units to cover emissions)
152
Section 178B amended (Issuing New Zealand units to meet surrender obligations)
153
Section 178C repealed (Prohibition on ability to export New Zealand units)
154
Part 5 divided into Parts 5 to 5D and new Part 5 divided into subparts
155
Section 179 amended (Forest land to be treated as deforested in certain cases)
156
Section 179A amended (Forest land may not be treated as deforested in certain cases)
157
Section 181 amended (When deforestation to be treated as occurring in respect of pre-1990 forest land)
158
Section 183 amended (Applications for exemption for land holdings of less than 50 hectares of pre-1990 forest land)
159
Section 183A amended (Certain applications not otherwise permitted by section 183)
160
New section 183B inserted (Applications for exemption for some Maori land or land with 10 or more owners)
183B
Applications for exemption for some Maori land or land with 10 or more owners
161
Section 184 amended (Exemptions for deforestation of land with tree weeds)
162
New section 185A inserted (Regulations about exemptions for deforestation of land with tree weeds)
185A
Regulations about exemptions for deforestation of land with tree weeds
163
Section 186 amended (Methodology for pre-1990 forest land cleared in 8 years or less)
164
Section 186B amended (Criteria for approving offsetting forest land applications)
165
Section 186C amended (Conditions applicable to offsetting forest land)
166
New section 186CA inserted (Variation to approved offsetting forest land application)
186CA
Variation to approved offsetting forest land application
167
Section 186D amended (Requirements relating to offsetting forest land)
168
Section 186F amended (Regulations relating to offsetting)
169
Section 186H amended (Treatment of allocations in respect of pre-1990 forest land that is offset)
170
Section 186J amended (Methodology for pre-1990 offsetting forest land cleared after usual rotation period is completed)
171
New section 186K inserted (Standard and permanent forestry on post-1989 forest land)
186K
Standard and permanent forestry on post-1989 forest land
172
Section 187 amended (Conditions on registration as participant in respect of certain activities relating to post-1989 forest land)
173
Section 188 amended (Registration as participant in respect of post-1989 forest land)
174
Sections 188A to 191 replaced
188AA
Removing registration as participant in standard or permanent forestry
188AB
Removing registration as participant in standard or permanent forestry in certain natural events or clearance for forest management
188AC
Notice to forestry participant if their registration added or removed
188AD
Notice to interested party if forestry participant’s registration added or removed
Provisional and final forestry emissions returns
189AA
Provisional forestry emissions return in any year
189AB
Final forestry emissions return at end of mandatory emissions return period
189BA
Preparing provisional or final forestry emissions return
Calculations for provisional and final forestry emissions returns
189CA
Gross liability or entitlement for each CAA1 in emissions return
189CB
Net liability or entitlement for each CAA1 in final forestry emissions return
189CC
Unit balance calculation for each CAA1 in emissions return
189CD
Total liability or entitlement for all CAA1s in emissions return
Total liability or entitlement and unit balance has effect for all emissions returns
189DA
Total liability or entitlement has effect, and unit balance updated, when emissions return submitted
New unit balance report for certain applications or notices
189EA
New unit balance report
Maximum liability is unit balance of carbon accounting area
190
Maximum liability is unit balance of carbon accounting area
Ceasing participation in standard or permanent forestry
191AA
Ceasing participation for whole carbon accounting areas
191AB
Effect of ceasing participation for whole carbon accounting areas
191BA
Ceasing participation for part carbon accounting areas
191BB
Effect of ceasing participation for part carbon accounting areas
191CA
If participant has never carried out activity in carbon accounting area
Transmission of interest relating to standard or permanent forestry
175
Section 192 amended (Effect of transmission of interest in post-1989 forest land)
176
Section 193 replaced (Effect of transmission of interest in post-1989 forest land)
193
Effect of transmission of interest in post-1989 forest land
177
New cross-heading above section 194 inserted
Information about status of forest land
178
New sections 194AA to 194EL and cross-headings inserted
Non-compliance for transmitted interests
194AA
EPA may act if persons fail to give notice of transmitted interest
Application to reconfigure carbon accounting areas for standard or permanent forestry
194CA
Application to reconfigure carbon accounting areas for standard or permanent forestry
194CB
Criteria to reconfigure carbon accounting areas for standard or permanent forestry
194CC
Approval of application to reconfigure carbon accounting areas for standard or permanent forestry
194CD
Restriction start date of reconfigured carbon accounting area for permanent forestry
Application to change activity on post-1989 forest land
194DA
Application to change activity on post-1989 forest land
194DB
Criteria to change activity on post-1989 forest land
194DC
Approval of application to change activity on post-1989 forest land
194DD
Emissions return for application to change from PFSI activity
194DE
New unit balance report for application to change from PFSI activity
194DF
Liability to surrender units on transfer from permanent forestry to standard forestry in carbon accounting area (averaging)
194DG
Liability to surrender units on transfer from standard forestry in carbon accounting area (averaging) to permanent forestry
Restrictions for permanent forestry land
194EA
Permanent forestry period for land
194EB
Restriction on ceasing to be registered for permanent forestry
194EC
Minister may approve removal of land from permanent forestry
194ED
Exception from prohibition on clear-felling and deforestation
194EE
Permanent forestry land must not be clear-felled
194EF
Pecuniary penalty for clear-felling of permanent forestry land
194EG
Regulations for pecuniary penalty for clear-felling
194EH
Permanent forestry land must not be deforested
194EI
Pecuniary penalty for deforestation of permanent forestry land
194EJ
Due dates for payment of penalties and recovery of EPA’s costs
194EK
Option must be chosen at end of permanent forestry period
194EL
Removal of carbon accounting area from permanent forestry
179
New subparts 5 and 6 of Part 5 inserted
Subpart 5—Averaging accounting methodology
General provisions
194FA
Interpretation for subpart 5
194FB
Averaging accounting methodology
194FC
Averaging accounting applies to carbon accounting areas (averaging)
194FD
First rotation forest and subsequent rotation forest
Carbon equivalent forest land swaps: applications
194GA
Application for carbon equivalent forest land swap
194GB
Criteria for carbon equivalent forest land swap
194GC
Effect of approval of application to swap land
Carbon equivalent forest land swaps: approved swap land
194HA
Duration of approved swap land status
194HB
Effect of being approved swap land
194HC
Subsequent rotation forest
194HD
Reconfiguration restrictions
194HE
No transfers to permanent forestry
Carbon equivalent forest land swaps: release of approved swap land
194JA
Release criteria
194JB
Notice of compliance with release criteria
194JC
Liability to surrender units if release criteria not met
194JD
Maximum liability and apportionment
194JE
Release date unit balance report
194JF
Effect on release date
Carbon equivalent forest land swaps: action if original criteria not met
194KA
EPA may take action if original criteria not met
194KB
Effect of declaration after release date
194KC
Remedial action: land substitution
194KD
Criteria for land substitution
194KE
Effect of land substitution
Regulations
194LA
Regulations for averaging
Subpart 6—Temporary adverse events
194MA
Interpretation for subpart 6
Application
194NA
Application for temporary adverse event suspension
194NB
Criteria of temporary adverse event suspension
194NC
Approval of temporary adverse event suspension
Temporary adverse event land
194PA
Duration of temporary adverse event land status
194PB
Effect of being temporary adverse event land
194PC
No liability or entitlement
194PD
First rotation forest
194PE
Reconfiguration restrictions
194PF
Damage to land turns out to be permanent
Re-establishment
194QA
Re-establishment criteria
194QB
Notice of achievement of re-establishment
194QC
Effect on re-establishment date
Carbon recovery
194RA
Carbon recovery criteria
194RB
Notice when land achieves carbon recovery
Ceasing to be temporary adverse event land before recovery
194SA
Cancellation for breach of conditions
194SB
Other circumstances causing land to cease to be temporary adverse event land
194SC
Consequences if land ceases to be temporary adverse event land
Regulations
194TA
Regulations for temporary adverse events
180
New sections 194UA to 194UC and cross-headings inserted
Input returns before actual emissions returns
194UA
Input returns may be submitted for certain emissions returns for forestry activities
194UB
EPA may do calculations based on input return
194UC
Regulations for input returns
Notification of status of forest land
181
Section 195 amended (Notification of status of forest land)
182
Sections 196 and 197 and cross-heading replaced
Forestry classifications of land
196A
Meaning of forestry classification
196B
EPA may give forestry classifications to areas of land
196C
Effect of forestry classifications
196D
Change of forestry classification to correct error
196E
Change of forestry classification to update for changes
196F
Forestry classification with effect before date classification given
196G
Regulations for forestry classifications
Grant-funded forests
197
Entitlement to units for removals from grant-funded forests
197A
Regulations for grant-funded forests
183
Section 198 amended (Registration as participant by purchasers of obligation fuel)
184
Section 202 amended (Activities added to Part 2 of Schedule 3)
185
Section 209 amended (Registration as participant by purchasers of coal or natural gas)
186
New section 211A inserted (Effect of stockpiling coal by coal importer or miner)
211A
Effect of stockpiling coal by coal importer or miner
187
Section 217 amended (Transitional provision for penalties)
188
Section 218 amended (Transitional provision for voluntary reporting)
189
Section 219 amended (Transitional provision for mandatory reporting by certain participants)
190
Sections 220 to 222 repealed
191
Section 222H amended (Transitional provision for unincorporated bodies)
192
Section 233 amended (Rate of synthetic greenhouse gas levy)
193
Sections 234 and 236 repealed
194
Section 243 amended (Circumstances where levy may be refunded)
195
Section 246 amended (Regulations relating to synthetic greenhouse gas levy)
196
Section 247 amended (Process for making orders and regulations)
197
Section 249 amended (Application of section 88 (Directions to EPA))
198
Section 252 amended (Enforcement officers)
199
Section 257 amended (Power of entry for investigation, warrants, etc)
200
Section 258 amended (Regulations relating to verifiers)
201
Section 270 amended (Appointment and conduct of independent panel)
202
New Schedule 1AA inserted
203
New Schedule 2A inserted
204
Schedule 3 amended
205
Schedule 4 amended
Subpart 2—Amendments that commence on 30 November 2020
206
Section 30G amended (Regulations relating to Part 2)
207
Section 183A amended (Certain applications not otherwise permitted by section 183)
208
Section 186B amended (Criteria for approving offsetting forest land applications)
209
Section 186H amended (Treatment of allocations in respect of pre-1990 forest land that is offset)
210
Section 189DA amended (Total liability or entitlement has effect, and unit balance updated, when emissions return submitted)
211
Section 191AB amended (Effect of ceasing participation for whole carbon accounting areas)
212
Section 191BB amended (Effect of ceasing participation for part carbon accounting areas)
213
Section 194AA amended (EPA may act if persons fail to give notice of transmitted interest)
214
Section 194DF amended (Liability to surrender units on transfer from permanent forestry to standard forestry in carbon accounting area (averaging))
215
Section 194DG amended (Liability to surrender units on transfer from standard forestry in carbon accounting area (averaging) to permanent forestry)
216
Section 194EL amended (Removal of carbon accounting area from permanent forestry)
217
Section 194FC amended (Averaging accounting applies to carbon accounting areas (averaging))
218
Section 194GC amended (Effect of approval of application to swap land)
219
Section 194JC amended (Liability to surrender units if release criteria not met)
220
Section 194KB amended (Effect of declaration after release date)
221
Section 194KE amended (Effect of land substitution)
222
Schedule 1AA amended
Subpart 3—Amendment that commences on 31 December 2020
223
Section 89 amended (EPA to publish certain information)
Subpart 4—Amendments that commence by Order in Council or on 1 January 2023
224
Section 2A amended (Application of Schedules 3 and 4)
225
Section 27 amended (Information accessible by search)
226
Section 89 amended (EPA to publish certain information)
227
Sections 178A and 178B repealed
228
Section 233 amended (Rate of synthetic greenhouse gas levy)
229
Schedule 1AA amended
Part 2
Consequential amendments to other enactments
Subpart 1—Consequential amendments that commence on day after Royal assent
230
Climate Change (Fishing Allocation Plan) Order 2010 revoked
231
Consequential amendments
Subpart 2—Consequential amendments that commence on 30 November 2020
232
Consequential amendments
Subpart 3—Consequential amendments that commence on 1 January 2021
233
Consequential amendments
Subpart 4—Consequential amendments that commence on 1 January 2022
234
Consequential amendments
Schedule 1
New Schedule 1AA inserted
Schedule 2
New Schedule 2A inserted
Schedule 3
Consequential amendments that commence on day after Royal assent
Schedule 4
Consequential amendments that commence on 30 November 2020
Schedule 5
Consequential amendments that commence on 1 January 2021
Schedule 6
Consequential amendments that commence on 1 January 2022
Schedule 7
New Schedule 1AA inserted in Forests Act 1949
The Parliament of New Zealand enacts as follows: