Fintech News & Trends in Hong Kong and Asia

Punitive system to better protect environment

Aerial photo taken on Sept 23, 2021 shows the autumn scenery of Saihanba forest farm in North China's Hebei province. (PHOTO / XINHUA)

People who intentionally damage the environment, causing serious consequences, are set to face much harsher punishment, China's top court said on Thursday.

The move to introduce punitive damage compensation in such cases is in line with the new judicial interpretation issued by the Supreme People's Court.

The 14-article legal document on applying a punitive damage compensation system in ecological and environmental cases, which takes effect on Jan 20, is its latest measure to fight pollution, promote sustainable development and beautify the country.

Yang Linping, vice-president of the court, said that the interpretation is also to uphold Xi Jinping Thought on Ecological Civilization and effectively implement related provisions of the Civil Code.

Punitive damage compensation is considered a harsher punishment and will typically be awarded at a court's discretion when the defendants' behavior is found to be especially harmful, she said.

Punitive damages have already been applied across the nation in the fields of intellectual property protection and food safety.

"We have introduced the punitive damages system to this new area, because we hope to present a bigger threat to polluters by ordering them to pay a higher penalty for their violations," Yang added. "The more polluters pay, the more effectively we will prevent similar incidents."

Feng Fan, a lawyer from Jiangxi province and a deputy to the National People's Congress, China's top legislature, said that the punitive damages system was an innovation in environmental protection, and it will contribute to increasing the cost of breaking related laws.

Qin Tianbao, director of the Research Institute of Environmental Law at Wuhan University's Law School, said that the top court's move, which specifies how to apply the system in the handling of environmental cases, is a groundbreaking move worldwide, adding that it provides a Chinese solution in global environmental governance.

While agreeing on the need to punish polluters more severely, the two experts also welcomed stipulations in the document requiring judges to adopt a prudent approach when awarding punitive damages, in order to prevent abuses of the system.

For example, the interpretation stipulates that the amount of punitive damages should be calculated based on the extent of personal harm or property losses caused by the pollution or environmental damage. It added that such punitive damages should generally be no more than twice the amount of those that would have previously been awarded.

It also specifies situations in which polluters' behavior can be identified as "intentional damage to the environment", in order to ensure the document is implemented more effectively.

One such situation will be when individuals or enterprises refuse to correct irregularities and continue discharging pollutants after being warned by government agencies.

Moreover, it also states that polluters whose actions result in deaths, damage to people's health or property losses will be identified as "serious consequences".

caoyin@chinadaily.com.cn