Regulations on Ecological Protection Compensation (State Council Order No. 779).

These Regulations are enacted to protect and improve the ecological environment, strengthen and regulate ecological protection compensation, and mobilize the enthusiasm of all parties to participate in ecological protection.
The state compensates entities and individuals who carry out important ecological environment element protection, as well as entities and individuals who carry out ecological protection in key ecological function areas designated by law, through financial transfer payments and other means. For entities and individuals engaged in the protection of important ecological and environmental elements, the central finance shall implement compensation according to the classification of forests, grasslands, wetlands, deserts, oceans, water basins, cultivated land, etc; The specific scope and methods of compensation should be determined based on factors such as regional economic and social development level, fiscal capacity, and ecological protection effectiveness, and should be disclosed to the public in accordance with the law, along with the use of compensation funds and their supervision and management.
In terms of the market mechanism in ecological protection compensation, the state promotes the market-oriented development of ecological protection compensation; encourage social forces such as enterprises and public welfare organizations, as well as local governments, to carry out ecological protection compensation in accordance with market rules by purchasing ecological products and services; establish and improve trading mechanisms for carbon emission rights, pollution discharge rights, water rights, carbon sink rights, etc., promote the construction of trading markets, and improve trading rules.