Environmental payments regulations in the system of law

Table of contents: The Kazakh-American Free University Academic Journal №7 - 2015

Author: Gavrilova Yuliya , Kazakh - American Free University, Kazakhstan

The problem of environmental payments regulation in the system of law deserves close attention as a result of its complex legal nature and its scientific and practical value caused by relations concerning charging for environmental emissions and natural resources use. Complex character of the legal nature of environmental payments as an ecological and legal category is defined by interrelation of the stated relations with the tax, budgetary, and civil ones that indicates the need of accurate and detailed consideration of the role and place of environmental payments regulations in the system of law.

The consideration of the aforesaid task is necessary to begin with the analysis of the concept “the system of law”. Philosophical and legal literature interprets the system of law as a complex of structurally ordered interconnected elements forming a unity whereas the structure is a special way of internal interrelation of elements in the system [1, p. 274]. From the point of view of Kazakhstani law scholars A. Yerenov, N. Mukhitdinov, and L. Ilyashenko the distinctive features of the system are as following:

1) it consists of a few or lots of elements;

2) the elements are united in the system according to their substantial features;

3) the elements of the system are definitely interacting components;

4) when interacting with the environment the system always acts as something unified and qualitatively definite;

5) the system components are relatively independent [2, p. 71-72].

For the first time the system of law was discussed at the first meeting of law scholars in 1938. It was recognized that the subject of legal regulation, i.e. the public relations regulated by the law, is of crucial importance among the objective criteria defining the structure of the Soviet law and its subdivision into separate branches [3, p. 5].

In the discussion of 1956-1958 the subject was recognized as the main criterion for differentiating regulations on branches, as the leading foundation of the system of law. However, even then one of the criteria of the system was considered the method of legal regulation, along with its subject [4, p. 68].

Nowadays the “criteria for modern legal science subdivision into branches are the subject and the method of legal regulation.  In fact, it is just the subject of legal regulation as no branch of legal science has its special method. At such criterion the legal branches can be subdivided indefinitely. The similar situation is observed at the lower levels of the hierarchy – law institutes and regulations” [5, p. 13].

The institute is usually defined as a set of interconnected law rules objectively stood apart in one or several legal branches and regulating unified group of public relations [6]. Such relations are components of the subject of legal regulation [7, p. 402]. The main point of legal institute can be correctly defined only if to consider it as a set of law rules which, in its turn, is a structural element of the following main subdivision – a law branch. The legal institute, as well as a rule of law, has a number of its distinctive features. Firstly, each legal institute provides independent regulatory impact on a certain aspect of relations. Secondly, regulating a certain aspect of public relations, the legal institute possesses the actual and legal uniformity. Thirdly, according to A. Ibrayeva and N. Ibrayev the legal criterion for uniting certain sets into a concrete legal institute is “a provision of regulations  forming a legal institute in chapters, sections, parts, and other structural units of laws and other legal acts” [8, p. 83].

Legal institutes are independent structural subdivisions of both the system of law and all its relevant branches, thus strengthening the integrity of the system of law.

Therefore, the traditional structure of the system of law is a hierarchy with the following levels (top-down): the system in general, its branches, institutes, and rules of law. More detailed legal research differentiates also sub-branches and sub-institutes.

The rule of law is a primary element of all the system of law and an example of people’s behavior and activity. G. Sapargaliyev, a contemporary theorist of constitutional law, is correct to consider the rule of law as a section of a legal matter [9, p. 17]. “Besides, any state-organized society can’t do without legal rules. It is a single phenomenon of law and therefore its complete scientific definition assumes clarification of its inherent specific features (properties) [10, p. 257]. The need for consideration of legal rules features is also explained by a variety of social regulations such as moral norms or rules of some separate (non-state) social communities.

D. Bulgakova mentions the following main features of legal rules:

1. Obligation: it represents the imperious instruction of the state concerning people’s possible and due behavior;

2. Formal definiteness: it is expressed in official documents in writing;

3. Relation to the state: it is established by government bodies and provided by measures of state influence;

4. Granting-binding character: it not only grants but also assigns legal subjects duties as the law is impossible to exercise without a duty and the duty without a law [11, p. 51].

Professor S. Alekseyev specifies that “legal rules being variants of social norms are characterized by features common to all social norms: they are rules of people’s conduct in society; they are rules of conduct of general character; they are result of conscious and strong-willed activity; and are caused by a social and economic system…” [7, p. 334].

Present system of legal rules regulates relations concerning payments for environmental emissions and use of some types of natural resources.

When speaking about the structure of legal rules, it is necessary to emphasize the disposition regulating the order of payments for environmental emissions and use of natural resources, including stipulation of environmental payments in law and definition of taxation object, payment rates, calculation and payment procedures, tax period, and tax returns.

The hypothesis as a component of a legal rule is expressed in determining the payment payers – individual and legal entities responsible for environmental emissions or using of some types of natural resources on the basis of special allowing documents.

The sanction as the third structural part of rule of law plays an important role in the implementation of its guarding function. The sanction determines possibility of its compulsory implementation and legal consequences of violations of legal requirements. Sanctions are directed to those who do not obey law requirements. They perform a preventive function, thus to some extent constraining law violations. In relation to the discussed structure of environmental payments rules the sanctions are mentioned in the following acts of public law – the Code of Administrative Offences and the Criminal Code.

Thus, having considered the structure of environmental payments rules, it is necessary to emphasize that not exact interpretation of a hypothesis involves a defective legal design of the rule not provided with due conceptual base. It also should be mentioned that qualitative characteristics of legal rules and their relevant application in many respects depend on a detailed and complete determination of their structural components.

The problem of correlation of law branch and legislation branch is very often considered in legal literature. When considering the concept and structure of the system of law it is important to consider the structure of legislation branch also. The system of legislation can be considered in two aspects presented in its vertical and horizontal structures. According to M. Baitin and D. Petrov the structure of legislation is “an arrangement and correlation of its elements including acts and regulations, i.e. forms (legal sources) of law. If the vertical structure of the legislation reflects the hierarchy of regulations depending on their validity, the horizontal one reflects a certain arrangement (grouping) of these legal sources depending on spheres of public relations, i.e. legislation branches” [12].

Speaking about legislation concerning the rules in question it is necessary to mention the Environmental Code of the Republic of Kazakhstan (Article 101. Payment for environmental emissions; Article 102. Obligatory payments to the budget for the use of some types of natural resources), the Water Code of the Republic of Kazakhstan (Article 133. Payment for the use of water resources), and the Forestry Code of the Republic of Kazakhstan (Article 105. Payment for the use of the state forest fund), etc. The rates, calculation and payment procedures are determined according to the Tax Law of the Republic of Kazakhstan.

It allows to draw a conclusion that a set of unified environmental regulations (i.e. payments for environmental emissions and environmental use) covering such branches as Environmental Law, Natural Resources Law, Tax Law, Budgetary Law, etc. forms a legal institute of  inter-branch complex character. Its complexity is also of a secondary, derivative nature since environmental payments, in their turn, are a variant of payments as a legal institute of Tax Law. The given institute is authoritative and expresses public interests of the state. In this case when establishing payments collection procedures the state acts as the holder of sovereignty. The rights and duties of environmental payments subjects are usually regulated by imperative rules.

When subsurface use agreements, providing environmental payments are signed, the relations are regulated according to private law.  But in contractual relations between subsoil users and the state the public law still prevails over the private law. Moreover, theorists of environmental law emphasize the advantages of such agreements and call them public-legal: … “Firstly, they are organizational, i.e. possess the huge regulatory ability stimulating economic activity in the branch in general. Secondly, through public agreements the state realizes its regulatory power and opportunities which are not the subject of civil agreements (change of a public order in taxation, licensing, tariffs, quotas, etc. ,… assignment of natural resources of exclusively state ownership for use)” [13, p. 44].

But, it is undoubted that in the course of further development and improvement of a contractual form of relationship, the private-law principles will prevail, thus proving the civil-legal not administrative-legal character of the agreements (contracts) in the sphere of subsurface use” [4, p. 162]. It is reflected in the qualitative characteristic of the institute of environmental payments which is being dynamic by its legal nature comprises both the principles of public and private laws.

Speaking about distinctive features of legal payments as institutional legal norms, it is necessary to emphasize that “each legal institute has its own characteristic features determined by the peculiarity of public relations regulated by it and unites all legal rules relating to these relations” [4, p. 75-76]. The institute of environmental payments is closely interconnected with other institutes of environmental law, e.g. the institute of environmental emissions payment is directly interconnected with the institutes of rate-setting and licensing as according to Clause 2 Article 27 of the Environmental Code of the Republic of Kazakhstan the standards of maximum permissible emissions and dumping of polluting substances are used as guidelines for granting environmental emissions permission.

Another example of interrelation of institutes of environmental emissions payment, environmental and (or) people’s health indemnification, environmental insurance. The latter institute is regulated by the Law of the Republic of Kazakhstan as of December 13, 2005 “About obligatory environmental insurance”. It defines the obligatory environmental insurance as a complex of relations providing property protection of legitimate interests of natural and (or) legal entities (the insured) at occurrence of civil responsibility according to obligations arising owing to infliction of harm to life, health, property of the third parties and (or) the environment as a result of its emergency pollution. In this context the point of view of the Kazakhstani researcher G. Tlebayeva sounds pertinent. She says, “the main task of environmental insurance is accumulation and allocation of funds for nature protection through special foundations or indemnification for environmental or population’s health damage as a result of environmental deterioration or quality change. In Kazakhstan the realization of environmental insurance is a necessary mechanism  due to high extent of emergency pollution of the environment, low capital investments to nature protection sphere and costs of the prevention and elimination of emergency situations consequences” [14, p. 19].

Thus, separate provisions of the Environmental Code of the Republic of Kazakhstan indicate that the systematized character of this statutory act coordinates environmental payments to other legal institutes which in total make mechanisms of economic regulation of environmental protection and management.

It also should be noticed that some institutes are characterized by the subdivision into counterparts called “sub-institutes”. Sub-institutes are organic formations of rather independent character formed within the institutes, thus, indicating the “complication” of the structure of the institute and relative isolation within its certain complex of rules. Such formations within the institutes often represent the expanded associations of instructions. The Kazakhstani scientist N. Baimbetov singles out the sub-institute within the institute of “state mechanism for environmental management” - the independent institute of “environmental assessment” [15, p. 53]. Such legal institutes consisting of sub-institutes can be called complex. This quality is characteristic for the institute of public administration which “focuses in itself a set of rather independent groups of legal rules – concerning environmental insurance, auditing, and standardizing the quality of environment, environmental assessment, and the state control in the sphere of environmental protection” [16, p. 105]. The complex nature of institute is also determined by the objective of the system of public administration. D. Baydeldinov is right to consider “public administration as an executive and administrative activity of government bodies aimed at providing an order in interaction of the society with the environment and realization of environmental duties of the state subjects” [17, p. 10].

In relation to the examined group of legal institutes it is possible to apply theoretical grounds subdividing the institute of environmental payments into “general institutes and sub-institutes sometimes called complex and simple, respectively. The general legal institute represents a set of sub-institutes … The sub-institute (the simple institute) is an institute which is a part of a larger institute. Unlike the general (complex) institute it does not include any groups of regulations isolated from the given institute or having an independent value. The sub-institute consists of rules regulating a uniform, rather small in structure, group of public relations…” [4, p. 76]. In our case, general institutes will act as a payment for environmental emissions and the use of some types of natural resources. In its turn, the general institute of environmental emissions payment will comprise the sub-institutes of the payment for environmental emissions, dumping of polluting substances, the payment for wastes disposal and consumption in the environment, and the payment for harmful physical impacts. The sub-institutes of payments for the use of soil, subsoil, plants and animals, etc. form a complex institute of payments for the use of natural resources.

When determining the role of the environmental payments institute in the system of law, it is necessary to proceed from the purpose of these payments. In our opinion, these payments have to stimulate decrease in negative impact on the environment to the standard level which would guarantee a favorable environment for people’s life and health. Besides, environmental payments are one of the regulators of economic activity.

Modern situation seems a serious deformation of a normal market mechanism when through nature protection activity there is a decrease in profit of enterprises. Besides, it promotes import of ecologically “dirty” technologies and productions as the payment for environmental pollution in our country is much lower than abroad. To stimulate nature protection under normal market relations the size of payments (taxes) for environmental pollution, wastes disposal and recycling at least has to reflect socially necessary costs of these actions taking into account the standard profit. This will create favorable conditions for extensive development of environmental business and stimulation of the nature protection tasks solution. Besides, today it is impossible to increase tax burden of the enterprises as it is high enough. In this regard the increase in the size of environmental payments (taxes) at the same time has to be followed by adequate decrease in other taxes which is to be reflected in the Tax Law of the Republic of Kazakhstan.

Professor M. Vassilyeva suggests to stimulate nature protection “by providing in the tax and budgetary laws the possibilities for temporary tax privileges (in specific cases of economic activity, e.g. at construction of treatment facilities for housing-and-municipal sector, dumps processing, recycling of some types of waste, re-cultivation of territories, etc.), mortgage cost on some types of consumption waste (packing, car tires, accumulators, etc.), environmental deposits (to guarantee financing of waste disposal grounds re-cultivation), and creation of environmental foundations (to eliminate the saved-up environmental damage of past years, to grant credits, and allocate the state orders for environmental protection works” [18, p. 14-15].

Now it is possible to make a summary concerning the place of environmental payments regulations in the system of law. The use of a systematic and structural approach indicates that environmental payments regulations form a general inter-branch, complex, and derivative institute consisting of sub-institutes of payments for environmental emissions, polluting substances dumping, production wastes disposal and consumption in the environment, and harmful physical impacts.

Forming their own niche in the systems of legislation branch and law, the rules of complex institute of environmental payments are closely interconnected with the institutes of economic incentives for environmental protection, environmental insurance, economic assessment of environmental damage, etc. All these institutional formations are a direct consequence of transformations in natural resources relations under the carried-out market reform. Thus, the correct application of environmental payments regulations is possible only through the interrelation with the legal standards in environmental insurance, environmental protection and environmental management licensing, and economic assessment of the environmental damage.

Under the transition of the Republic of Kazakhstan to market economy the role of economic regulation in rational use and protection of natural resources gains priority development which is to find its reflection at the legislative level. Unfortunately, the legal institute of environmental payments is not fixed in the legislation to the right degree. Today there is a need of adoption of a separate act which would regulate questions of payments for negative environmental impact in further detail. The environment in our country will depend on further stipulation of the institute of environmental payments in the separate act and its relevant provision.


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Table of contents: The Kazakh-American Free University Academic Journal №7 - 2015

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