Newsletter
Overview of the Regulations for the Management of Carbon Dioxide Capture and Storage
Pursuant to Paragraph 5, Article 39 of the Climate Change Response Act (the “Act”), the Ministry of Environment promulgated the Regulations for the Management of Carbon Dioxide Capture and Storage (the “Regulations”) on August 25, 2026. The Regulations comprise thirty articles and govern the procedures for entities undertaking carbon capture and storage (“CCS”), including application, review, implementation, monitoring, and closure. The key points are as follows:
I. Applications for Storage Approval and Exploration Consent Documents Must Include Required Documents, Such as Proof of Consent to Land Use
Under Article 4 of the Regulations, government agencies and colleges and universities, as well as non-state-owned enterprises and incorporated foundations meeting the applicable minimum threshold of NT$20 million in paid-in capital or total assets, may apply for storage approval or geological exploration documents approved by the central competent authority (“Exploration Consent Documents”).
In principle, an entity must first apply for and obtain Exploration Consent Documents before applying to the central competent authority for storage approval. Articles 5 to 9 of the Regulations set out the required application documents, which include the following:
(1) Both applications must include documents certifying land use approval or, where applicable, letters of intent for land use. As this requirement has often given rise to disputes in practice, it remains to be seen how the central competent authority will determine the format and content of these documents. If the process of obtaining land-use consent reaches an impasse, it is important to understand what mechanisms may be available to resolve it, such as filing an administrative appeal to seek the intervention of a higher-level authority.
(2) If the exploration site or storage site is located on indigenous land, tribal land, or public land within a prescribed area surrounding a tribe, the applicant must submit the relevant documents demonstrating compliance with Article 21 of the Indigenous Peoples Basic Law.
(3) An application for storage approval must include the contents and review conclusions of documents approved under the Environmental Impact Assessment Act. Entities should therefore be mindful of the applicable environmental assessment requirements.
(4) The applicant must submit documents demonstrating that its major shareholders have the financial capability to contribute equity capital of no less than 15% of the total investment amount.
The central competent authority must decide whether to approve or reject an application within three months of receiving it; however, the review period may be extended if necessary. If the application materials require correction, the total correction period may not exceed ninety days and is not counted toward the review period (Article 10 of the Regulations).
II. Amendments to and Extensions of Storage Approval
A storage approval document must specify its validity period, the entity’s basic information, and the approved storage content. An entity may apply for an extension within six months prior to the expiration of the storage approval (Articles 11 and 14 of the Regulations). A previous draft of the Regulations announced by the Ministry of Environment had proposed a fixed ten-year validity period, but this provision was removed from the final version. It remains to be seen what validity period the central competent authority will grant and whether any limits will apply to extensions.
III. Carbon Dioxide Sources and Concentration Requirements for the Carbon Dioxide Stream
As a general rule, carbon dioxide stored by an entity must be captured domestically, and the carbon dioxide stream must have a carbon dioxide concentration of at least 95%. Other substances contained in the stream must not pose a significant risk to the storage site, related transportation infrastructure, the environment, or human health (Articles 16 and 17 of the Regulations). In the event of a violation, the central competent authority may impose a fine of NT$100,000 to NT$1 million pursuant to Article 29 of the Regulations and Article 53 of the Act, and it may impose an additional fine for each subsequent violation.
IV. Handling of Irregularities During the Storage Period
If an entity encounters any irregularities or leakage during the storage period, it must suspend storage operations, take the necessary remedial and emergency response measures, and notify the central competent authority within twenty-four hours (Article 19 of the Regulations). If an entity violates these requirements, the central competent authority may impose a fine of NT$100,000 to NT$1 million pursuant to Article 29 of the Regulations and Article 53 of the Act, and it may impose an additional fine for each subsequent violation.
V. Monitoring and Document-Submission Obligations
Monitoring Obligations During the Storage Period
After obtaining storage approval, an entity must establish an online platform to publicly disclose information, including the contents of the storage approval and real-time monitoring information. It must also upload real-time images of the site, carbon dioxide concentration data, and seismic monitoring information to the website designated by the central competent authority (Article 15 of the Regulations). During the storage period, the entity must log monitoring records on the designated website every quarter. During the post-abandonment monitoring period, it must log those records every six months and submit them to the central competent authority for recordation (Article 18 of the Regulations).
Obligation to Submit Financial Assurance and Liability Insurance Documentation
To ensure that the relevant obligations are fulfilled, during the storage and post-abandonment monitoring periods, an entity must submit financial assurance documents and proof of environmental damage liability insurance for the following year to the central competent authority for recordation by December 31 of each year (Article 22 of the Regulations).
If an entity violates the above monitoring or document-submission obligations, the central competent authority may impose a fine of NT$100,000 to NT$1 million pursuant to Article 29 of the Regulations and Article 53 of the Act, and it may impose an additional fine for each subsequent violation.
VI. Grounds for Withdrawal or Revocation of Storage Approval
Under Article 26 of the Regulations, in addition to cases where an entity is dissolved, closes its business, or voluntarily applies to revoke its storage approval, the central competent authority may withdraw or revoke the storage approval if the entity: (1) submits false or fraudulent application documents, and the circumstances are severe; (2) fails to conduct storage in accordance with the approved pilot plan, implementation plan, or storage approval document, and the circumstances are severe; (3) continues storage operations that have a severe impact on the environment or public interest; or (4) commits a violation of the Regulations that the central competent authority deems to be of a severe nature.
Article 123 of the Administrative Procedure Act sets out five grounds on which a lawful, beneficial administrative disposition may be revoked. In contrast, many grounds for withdrawal or revocation under the Regulations are subject to requirements involving “severe circumstances” or “severe impact.” It is reasonable to expect that the central competent authority will further clarify how these requirements are to be assessed in practice through the application of the principle of proportionality.
In addition, the provision under the Regulations concerning application documents that “contain false or fraudulent statements of a severe nature” appears to overlap with Subparagraph 2, Article 119 of the Administrative Procedure Act, which refers to “furnishing incorrect information or making an incomplete statement.” It remains to be seen whether, and how, this issue interacts with the principle of protection of reliance.
VII. Penalties
If an entity violates the requirement to obtain approval before conducting carbon dioxide storage, to execute operations in accordance with the approved contents, to comply with the requirements governing the carbon dioxide source and stream, or to meet its obligations concerning the handling of irregularities, monitoring, or document submission, the central competent authority may, pursuant to Article 29 of the Regulations and Article 53 of the Act, impose a fine of not less than NT$100,000 and not more than NT$1 million, and order the entity to make corrections or improvements within a specified time limit. If the entity fails to make the required corrections or complete the improvements by the deadline, the central competent authority may impose an additional fine for each subsequent violation.
Under the Regulations, decisions concerning applications for Exploration Consent Documents or storage approval, extensions, review obligations, withdrawal or revocation of approvals, and measures imposed for violations (such as fines or orders to make improvements within a specified time limit) may all be administrative dispositions. If an entity receives an unfavorable decision and has questions about the interpretation or application of the relevant laws and regulations, or doubts the legality of a particular administrative disposition, the entity may seek remedy through administrative appeals or litigation. In addition, several provisions of the Regulations may involve indeterminate legal concepts; therefore, further discussion and developments in administrative practice can be expected concerning the clarity of these provisions and the scope of the central competent authority’s discretion.