Compliance policy for monitoring, guiding and lawsuits activities

Introduction

The BidCarbon Foundation’s objective is to contribute to a reduction in the net greenhouse gas emissions of eligible countries, including through the administration of market-based mechanisms that provide incentives for the reduction of emissions and the upgrading of agricultural technology.

We operate for the microclimate good in administering the:

● BidCarbon (Carbon Farming) Standard

● Greenhouse Gas Reporting Standard

● BidCarbon Registry of Units Specifications

This policy outlines our approach to specific aspects of compliance activities under the schemes we administer. High levels of compliance further the objectives set out in the Scheme and underpin confidence in the primary carbon markets we operate.

Our approach includes assisting scheme participants in understanding their obligations and in taking the necessary steps to comply with them. We also work with those who wish to do the right thing and take an overall approach to deter, detect and respond to non-compliance in order to ensure the ongoing integrity of the scheme.

Responsibilities of scheme participants

It is the responsibility of the person or organisation to whom the standard, policy, guidance or contract applies to comply with the relevant requirements under the schemes administered by the BidCarbon Foundation. Scheme participants have exhibited high levels of compliance with the schemes administered by the BidCarbon Foundation and we expect this to continue.

The BidCarbon Foundation’s responsibilities

In order to achieve the objective of reducing carbon emissions, the BidCarbon Foundation is responsible for:

● explaining how schemes work and what participants can do to comply with scheme requirements

● monitoring compliance

● the facilitation and enforcement of compliance with the scheme

● collecting, analysing, providing and publishing information and data, and

● accrediting auditors and inspectors for the schemes we administer.

Furthermore, we are dedicated to collaboration with other regulatory bodies, agencies, law enforcement agencies, and industry associations. This encompasses the exchange of pertinent information, the collection of intelligence, and the referral of matters to law enforcement authorities.

Objectives and guiding principles

An intelligence-led risk-based approach to compliance

The Technical Governance Committee monitors the ability and willingness of existing and intending scheme participants to meet their obligations, as well as their operating environment. This information informs our compliance strategy and decisions.

Where a suspected compliance issue exists, we will begin by gathering and analysing relevant facts to identify the cause, decide the likelihood that a contravention has occurred (or may occur), the degree of seriousness, and likely consequences.

To assist in determining the appropriate response, we use an intelligence-led risk-based approach that considers the behaviours and motivations of scheme participants:

● Scheme participants who actively engage with us — participants who maintain regular contact with us, provide all requested information and are quick to take corrective action when required. These participants are generally least likely to contravene their obligations.

● Scheme participants experiencing difficulty meeting their obligations or who make honest mistakes — participants who engage early to advise us of their challenges or discovery of an anomaly in information provided, and seek our guidance on how to self-correct. These participants will be supported to return to compliance.

● Scheme participants who are unwilling to meet their obligations — participants who regularly or intentionally provide incomplete or inaccurate information, ignore statutory timelines for routine tasks, who do not reply promptly to our efforts to engage them, fail to take steps to resolve their non-compliant behaviour, or who are not genuine in their efforts to meet their obligations. These participants are more likely to experience stronger compliance action.

■ The degree of compliance action in this latter category will depend on the intent or seriousness of the degree of non-compliance, and the impact of the non-compliance on the objectives of the schemes as explained in Figure 1.

Figure 1 provides an overview of our compliance approach in light of the motivations and behaviours of the scheme participant. We prioritise stopping and preventing harm.

Participant’s attitude to compliance

Technical Governance Committee interaction with scheme participants

In most cases the Technical Governance Committee will engage scheme participants, to provide advice and support to help them to understand their obligations and entitlements.

There will be occasions when we will engage with a scheme participant to manage compliance issues and will openly and directly discuss concerns with the participant to seek the necessary information or action to help finalise our enquiries. We will close enquiries as soon as possible to minimise costs to the participant if our concerns are adequately addressed through the additional information provided, or action taken by the participant.

Guiding

The Technical Governance Committee recognises that engagement, guiding and outreach are vital to ensure scheme participants are equipped with the knowledge to meet their obligations and avoid inadvertent non-compliance. We recognise that prevention of non-compliance is always preferable to taking action after non-compliance has occurred. To help drive a preventative approach we:

● co-design and collaborate with scheme participants and stakeholders on the development of guidance and guidelines to provide clarity on compliance expectations

● publish further information resources such as factsheets, booklets, brochures, newsletters, calculators and online resources

● invite scheme participants to raise concerns and join workshops and discussion forums, and

● incorporate feedback to enhance our systems and processes, where appropriate.

Monitoring

The Technical Governance Committee collects a large volume of data through our business operations (e.g., from applications, reports and submissions we receive, information from third parties, and from open data and other intelligence sources including geospatial). We use this data to assist us to monitor compliance through the following activities:

● comparing reports from scheme participants to third party data (e.g. regarding electricity generation, greenhouse gas emissions or abatement).

● identifying behavioural trends within and across the schemes.

● detecting possible contraventions and deciding whether enforcement action is required.

Where there is suspected non-compliance, we use intelligence and data analysis when possible to determine the intent of the behaviour. We will then take appropriate compliance actions that may include:

● conducting inspections and audits, and exercising coercive information-gathering powers.

We monitor any breaches of the laws that govern the institutions of the country or region where the legal entity has its borders, which could affect the fit and proper person requirements for participating in the voluntary schemes we administer. Should we become aware of any potential breaches of these laws, we reserve the right to bring such matters to the participant’s attention. In such an instance, we reserve the right to request that the participant demonstrate why they believe they remain a fit and proper person to participate in the scheme before making a decision on their status.

Lawsuits

This policy should be read in conjunction with other relevant instruments and documents, including the Technical Governance Committee Fraud Control Framework.

The Technical Governance Committee initiates legal proceedings in the first instance with the objective of preventing the continuation of the harmful activity in question. Should the circumstances warrant it, the Foundation will also seek to disrupt illegitimate business models and remove illegitimate participants. In appropriate cases, further legal action may be pursued. lawsuits action is likely to result when:

● there are reasonable grounds to suspect that a serious civil contravention or criminal offence, including fraud, is occurring

● the client has not demonstrated sufficient willingness to return to compliance

● there are repeated or habitual relapses into non-compliance, and

● conduct that appears to involve deliberate or intentional non-compliance has been displayed.

Matters the Technical Governance Committee considers when deciding whether to commence an investigation may include:

● whether the allegation involved repeated non-compliance, or the scheme participant has a history of non-compliant behaviour

● whether the alleged activity or behaviour is organised in nature

● the impact the alleged activity or behaviour may have on BidCarbon Foundation objectives, including the harm and/or loss to the BidCarbon Foundation, and

● whether the alleged activity involve the Carbon service providers.

A range of options are available to the Technical Governance Committee to respond to harmful behaviour. These include:

● undertaking corrective action for serious or continuing contraventions (including accepting voluntary offer and undertaking, exercising suspension and revocation powers)

● pursuit of legal action for violations of civil law.

● notifying other law enforcement agencies or regulatory bodies of suspected contraventions or suspected fraudulent or dishonest behaviour for investigation and/or potential prosecution.

You will find a list of compliance options available to us at Legal powers.

Publication of contraventions

In some cases, the BidCarbon Foundation is legally obliged to publish information about voluntary offers and undertakings. We will publish this information as soon as it is available.

Furthermore, we will publish the commencement and outcomes of any court action, the issuance of compliance notices, and other types of action. This information will be published as soon as is reasonably practicable. However, in some circumstances, such as an ongoing investigation, we reserve the right to exercise discretion on the timing of any publication.

Policy review

The Board of Trustees of the BidCarbon Foundation is committed to administering the BidCarbon Standard Scheme in an open, ethical and accountable manner. As part of this commitment, we regularly review the content and implementation of this policy to ensure that all relevant operational experience and standard amendments are incorporated.

Where amendments to this policy are required, the updated policy can be found on our website.

Compliance tools available to the BidCarbon Foundation

A risk-based approach to compliance is based on the understanding that the BidCarbon Foundation cannot detect and respond to every contravention. Instead, it is our intention to encourage intrinsic compliance. We will prioritise stopping or preventing harms, taking into account the impacts of the non-compliance and the objectives of the scheme.

After careful consideration of each case, we will determine which regulatory option is most suitable for the circumstances of the case and what can be achieved within the BidCarbon Foundation's resource constraints and strategic priorities, taking into account scheme integrity.

Further information

Any queries regarding obligations and entitlements under the schemes administered by the Board of Trustees of the BidCarbon Foundation can be directed to enquiries@bidcarbon.org.

Should you have any concerns about potential fraudulent activities or non-compliance, we would be grateful if you could report them to us. We also welcome any suggestions about our compliance approach, which you can provide to us at the above email address.