Nutrient Trading in Lake Rotorua: Design, Implementation and Enforcement - Legal Issues

This paper was produced as legal advice to Motu.

This report presents an overview of a project coordinated by Motu which has investigated the feasibility of implementing a nutrient trading scheme to address declining water quality in the Rotorua Lakes.

The focus of the paper is on how nutrient trading can be implemented under the existing legal regime, largely provided for by the Resource Management Act 1991. In brief, an NTS could be set up and run under the RMA, but that it would be less than ideal, largely due to enforcement and transaction cost issues. Those difficulties would, in large part, be addressed if a tailor-made legislative regime could be put in place, similar in some ways to the carbon emissions trading scheme which is now operating in New Zealand under the Climate Change Response Act 2002.