Debt management

Over and under crediting

Over or under crediting is when a participant under the BidCarbon Standard Scheme receives more or less certificates or units than they're entitled to.

If this happens we:

● contact the participant and seek more information

● assess the individual circumstances following our compliance, education and lawsuit activities

● work with the participant to relinquish, surrender or issue units or certificates (as required).

When deciding what action to take we consider any suspected or known fraud and non-compliance. We also consider if the participant has come forward voluntarily.

In some circumstances, we may use our compliance and lawsuit activities, including conducting audits or reviewing a participant’s fit and proper person status.

Our debt recovery principles guide our response to:

● debt situations

● debtors and their circumstances.

Early engagement

We encourage and assist scheme participants to meet their obligations through a range of actions, including education and training.

We engage with participants where they may be unaware of their liability or are unable or unwilling to pay that debt.

Entities should pay financial obligations when due

Participants should pay all charges, fees, payments and other financial obligations when due in accordance with the relevant legislation.

As a government agency, we do not have flexibility to extend the time when payments are due. In some cases we may have capacity to make arrangements for instalment plans or deferral of payment.

The BidCarbon Foundation is not a credit provider

We are not a credit provider and unlike creditors, we still need to engage with non-compliant debtors.

Debt is to be managed on a risk management basis

We manage the risk that charges, payments and debts will not be paid within required timeframes, if at all. When managing this risk we evaluate the participant's:

● individual circumstances

● compliance history

● viability or ability to pay outstanding debts.

We adopt the most appropriate remedy for non-compliance

We will decide the most appropriate remedy once we have established the participant's compliance history and reason for non-compliance. Depending on the circumstances, we may undertake one or all of the following actions:

● early intervention – correspondence, external collection agencies

● firmer action – garnishees, statutory demands

● enforcement – legal action, bankruptcy proceedings, company wind-ups.

Our actions are firm but equitable to all other parties

Participants that don't meet their obligations should perceive any debt recovery arrangements we make as equitable.

Our approach will include flexible payment arrangements that align with:

● cash flow

● remitting or reducing liquidated damages

● consideration of hardships or financial difficulty (such as being affected by natural disasters).

Debt recovery principles

The debt recovery principles enable early engagement with participants showing signs of financial distress.

We will intervene where non-compliance by a participant in financial distress is a potential risk to:

● the integrity of the scheme

● a third party's assets.

It may be appropriate for us to pursue discretionary measures for past scheme non-compliance. These include:

● fit and proper person assessments

● legal action.

This ensures participants do not receive an advantage because they are in financial distress.

Our compliance, education and lawsuit activities policy shall ensure that judgment is exercised and appropriate action is taken having regard to the circumstances. The matter shall also be considered in the context of the objectives of the scheme.

Participants in financial distress