Recently, the Natural Environment Conservation Act and the Act on the Conservation and Use of Biological Diversity (the “Biological Diversity Act”) were amended, establishing a legal basis for private participation in ecological restoration projects and Payments for Ecosystem Services (“PES”). These amendments aim to promote biodiversity and support corporate ESG initiatives. With the amendment of the Natural Environment Conservation Act on March 18, 2025, Article 45-7 was newly inserted, establishing legal grounds for private sector participation—including companies involved in ecological restoration—and for the recognition of related performance. With the amendment of the Biological Diversity Act on November 11, 2025, Article 16-2 was newly inserted, establishing legal grounds for private participation in PES and for the recognition of associated performance.
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Amended Natural Environment Conservation Act – Legal Grounds for Private Participation in Ecological Restoration Projects
Companies seeking to contribute to biodiversity enhancement may now participate in ecological restoration projects by: (i) donating property or land required for such projects to central or local governments, (ii) directly executing restoration projects and subsequently donating the restored area to the government, or (iii) providing rent-free leases of relevant properties.
To ensure the efficient execution of these private-public projects, the government may provide administrative support, such as organizing consultative bodies, offering business consulting services and formally recognizing participation efforts. To ensure such participation serves as a verified contribution to biodiversity improvement, performance records will be managed by the Ministry of Climate, Energy and Environment (the “MCEE”). Furthermore, the government may designate certain projects that are ecologically and environmentally exceptional as “Excellent Ecological Restoration Projects” following evaluation by specialized institutions.
These amendments will enter into force on March 19, 2026. Consequently, the enactment of subordinate statutes and implementing regulations regarding specific procedures for donations, usage/management, recognition of performance and certification standards is expected to follow shortly.
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Amended Biological Diversity Act – Legal Grounds for Private Participation in PES
PES is a system designed to provide fair compensation to landowners and others who participate in maintaining or enhancing ecosystem services—such as carbon absorption, recreation and healing—which constitute the benefits nature provides to humans. Under this system, companies may participate by (i) directly entering into contracts to cover implementation costs, or (ii) depositing funds or assets to enable the newly established PES Contracting Support Center to execute such contracts.
To promote private participation, the government may provide necessary administrative support, such as organizing consultative bodies, offering consulting services and recognizing participation. To ensure such participation is utilized for the maintenance and enhancement of ecosystem services, performance records will be managed by the MCEE.
These amendments will enter into force on November 12, 2026. Accordingly, subordinate statutes and implementing regulations regarding specific participation methods and performance management are expected to be enacted in the near future.
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With the establishment of legal grounds for private participation in ecological restoration projects and PES, companies can now receive official accreditation for their contribution to biodiversity and systematically manage their performance records.
Ahead of the 2026 enforcement, companies should closely follow the development of subordinate statutes and implementing regulations. They should also review their biodiversity strategies and risks in alignment with global and domestic market trends, where interest in biodiversity is steadily rising, while seeking new business and investment opportunities arising from these changes.
[Korean Version]
