Brazil’s Federal Government Regulates the National Policy for Payment for Environmental Services

On June 12, 2026, Brazil’s Federal Government enacted Decree No. 13,018/2026 (the “Decree”), regulating the National Policy for Payment for Environmental Services (PNPSA) and the Federal Program for Payment for Environmental Services (PFPSA), established under Federal Law No. 14,119/2021. The regulation had been anticipated by the market, as the absence of operational rules had limited the practical implementation of the instruments provided for in the Law and the development of large-scale PES initiatives.

In summary, the Decree assigns the Ministry of Environment and Climate Change (MMA) responsibility for managing the PNPSA and for issuing regulations regarding PES modalities and their respective technical guidelines. The Decree expressly establishes that the MMA will be responsible for regulating the National Registry of Payment for Environmental Services (CNPSA), as well as defining the tax incentives applicable to amounts received under PES arrangements.

Among the activities eligible to receive funding under the PFPSA, the Decree includes:

• Conservation and restoration of native vegetation;
• Conservation of remaining vegetation fragments in urban areas;
• Sustainable management of agricultural systems that contribute to carbon sequestration and retention, as well as soil conservation; and
• Conservation of areas covered by native vegetation that may be legally authorized for conversion to alternative land uses.

One aspect that deserves attention is the fact that the Decree does not expressly include the restoration and recovery of vegetation in Permanent Preservation Areas (APPs) and Legal Reserves (RLs) among the activities eligible to receive PFPSA funding. This regulatory approach is noteworthy because both the PNPSA Law and the Brazilian Forest Code recognize the environmental relevance of these areas, and allow the use of economic instruments aimed at their conservation and restoration.

The Decree also establishes a set of environmental and social safeguards applicable to public and private projects seeking access to resources under the policy. In particular, for initiatives involving Indigenous Peoples, traditional communities, and other potentially affected groups, the regulation requires compliance with Free, Prior and Informed Consultation (FPIC) procedures, as well as mechanisms for the equitable sharing of benefits.

Public and private projects must also implement monitoring mechanisms capable of verifying and demonstrating the effective provision of environmental services and the results achieved. For projects involving traditional communities, the regulation allows the adoption of simplified and participatory procedures.

Within the scope of the PFPSA, specific subprograms will be developed by the MMA in coordination with the relevant proposing authorities. These subprograms will define project selection criteria, target beneficiaries, remuneration modalities, funding sources, and applicable monitoring systems. For PES agreements entered into by public authorities, the Decree also establishes minimum eligibility requirements, including the absence of embargoed areas, registration of the property in the Rural Environmental Registry (CAR), and the beneficiary not being listed on Brazil’s “dirty list” of entities associated with slave-like labor practices.

Among the funding sources available to the PFPSA, particular attention should be given to the possibility of using resources derived from compensation linked to REDD+ certificates. This provision is particularly relevant, as it reinforces the convergence between the PES agenda, jurisdictional REDD+ programs, and economic instruments aimed at climate change mitigation, creating a potential source of funding for forest conservation and restoration initiatives.

The regulation should be aligned with other recent developments in Brazil’s climate policy framework, including the Climate Plan 2024–2035, the expansion of jurisdictional REDD+ programs, and the future implementation of the Brazilian Emissions Trading System, further reinforcing the role of economic instruments in the implementation of environmental and climate policies. From a practical standpoint, the Decree is expected to foster the development of public and private PES programs, creating new opportunities for rural landowners, traditional communities, and project developers.

The Environmental, Climate Change and Sustainability Practice of Tauil & Chequer Advogados in association with Mayer Brown remains available to provide additional information regarding the PNPSA, its scope, and its implementation.