TAIPEI (Taiwan News) — Taiwan’s carbon credit regulations are set to take effect on Aug. 15.

Drafted on July 1 by the Ministry of Environment (MOENV), the regulation's 38 articles specify the guidelines for holding, trading, and canceling carbon credits, per CNA. Carbon credits are permits that allow the owner to emit a certain amount of carbon dioxide.

MOENV Climate Change Administration official Kao Chun-hsuan (高俊璿) told CNA buyers and sellers need to ensure that all required fees are paid. If any fees are missing, the transaction process may not be completed, resulting in the inability to acquire the carbon credits, he said.

Kao added buyers need to pay transaction fees and the purchase price, and if they wish to acquire carbon credits through auction, they must first prepay a deposit.

Providers of carbon credits are seen as offering intangible assets similar to services, thus necessitating the payment of business tax, Kao explained. This requirement is handled according to the Ministry of Finance’s regulations, they said. 

Regarding the deposit required for auctions, Kao said this ensures the completion of the auction process. If the winning bidder backs out, the deposit will be forfeited. However, if the buyer completes the process as required, the deposit can be deducted from the purchase price, Kao said.

The government expects the first transaction to take place at the end of September.