Key takeaways from China’s new Ecological and Environmental Code

After more than two years, four rounds of deliberation and a public consultation that drew more than 20,000 comments from over 7,000 participants, the Chinese mainland’s new Ecological and Environmental Code (EEC) was adopted on 12 March 2026 at the fourth session of the 14th National People’s Congress.

It will take effect on 15 August 2026. The EEC is the world’s first code to carry “ecological and environmental” in its name.

The official leading the codification effort, Huang Wei, deputy director of the Legislative Affairs Commission of the Standing Committee of the National People’s Congress, has described the EEC as “neither a simple compilation of existing laws nor an entirely new legislative creation, but a systematic consolidation, revision and elevation of current ecological and environmental institutions and rules”. It reorganises more than 30 ecological and environmental laws, 100 administrative regulations and 1,000 local regulations together with related judicial interpretations, regulatory measures and policy rules. The aim is to resolve conflicts and gaps across the existing framework while turning sustainable development concepts into binding legal rules.

Basic principles

The EEC rests on six core principles, which run through its five books and 1,242 articles.

(1) Prioritising prevention. Upgraded from a basic principle under the former Environmental Protection Law (EPL) to the EEC’s leading principle, it underscores the central role of ex ante risk control.

(2) Systems governance. The EEC requires decision makers to consider the ecosystem’s overall interests and embraces integrated protection and governance of what Chinese law often describes as the shared community of life formed by mountains, rivers, forests, farmlands, lakes, grasslands and deserts. The aim is to move away from fragmented regulation by individual environmental element or region.

(3) Ecology priority. Evolving from the earlier principle of “protection first”, it establishes ecological interests as a hard constraint and marks a shift from pollution response to an ecology-centred approach.

(4) Green development. By creating a standalone book on green and low-carbon development, the EEC turns green and low-carbon transition into a statutory business obligation. It requires enterprises to implement energy efficiency upgrades, resource recycling, carbon accounting and disclosure, among other measures, pushing them away from end-of-pipe pollution control towards source-level carbon reduction and greener upgrading.

(5) Public participation. Building on the corresponding principle in the former EPL, the EEC’s general provisions include a dedicated chapter on information disclosure and public participation, clarifying the substantive and procedural rights – as well as legal duties – of citizens, legal persons and social organisations in environmental decision-making and oversight.

(6) Liability for harm. Retained from the former EPL, this principle reflects the idea that ecological damage carries a price, and responsibility must be pursued under the strictest legal framework.

Structure and content

The EEC is divided into books focused on: general provisions; pollution prevention and control; ecological protection; green and low-carbon development; legal liability; and supplementary provisions.

The general provisions book anchors the EEC, setting out foundational and generally applicable rules as well as the six core principles. The pollution prevention and control book integrates general rules on air, water and soil pollution – covering solid waste, noise and radioactive pollutants – and adds supporting rules for newer forms of pollution including chemical substances, electromagnetic radiation and light pollution. The ecological protection book seeks to reconcile economic development with ecological conservation, aiming to deliver both high-quality development and high-level environmental protection. For ecosystems such as forests, grasslands, wetlands, oceans, islands, rivers, lakes and deserts, it emphasises robust protection. For natural resources such as land, minerals, water and fishery resources, it focuses on conservation and sustainable use. The green and low-carbon development book introduces the framework for co-ordinating carbon reduction, pollution reduction, expansion of green capacity and economic growth, together with China’s “dual carbon” goals. The legal liability and supplementary provisions books respond to newer issues in environmental enforcement and adjudication by building a more unified, complete and stringent liability regime on top of the current legal base.

Stricter and newer

The EEC gives layered expression to the policy of the “strictest systems and the strictest rule of law”. In practical terms, that means: significantly higher penalties for some violations, up to RMB5 million (USD738,500); daily accruing fines; a broader look-through dual-penalty regime under which responsible personnel may face multiple sanctions alongside the entity itself; a clearer five-year limitation period for pursuing administrative liability; wider disciplinary exposure for public officials; and a mandatory requirement for pollutant-discharging entities to establish pollution prevention responsibility systems.

Its more notable innovations include making green and low-carbon development a standalone book and giving low-carbon transition a systematic legal framework. The addition of dedicated rules for pollution in newer fields and creation of a full ecological protection book move beyond the older legislative model of protecting single ecological elements in isolation and instead embraces system-wide protection. The EEC also introduces rules for the disposal of emerging waste streams generated by industrial change – including wind turbine blades, photovoltaic modules and retired power batteries – and clarifies responsibility and recycling requirements for such materials.

Meaning for industry

The new regime places significant compliance pressure on a wide range of market participants, from companies in high energy consumption, high pollution, high carbon emission and emerging pollutant sectors to operators located within or adjacent to ecological conservation red lines and protected areas – as well as businesses in energy saving, environmental protection and other green industries.

Against that backdrop, companies will need to build more forward looking compliance systems. This includes putting in place a clear environmental compliance structure, allocating responsibility at the decision making level, creating dedicated compliance roles where necessary and embedding compliance requirements across production, procurement, operation, maintenance and disposal.

It also necessitates conducting thorough internal reviews to identify gaps in pollutant discharge, ecological protection and carbon management compliance, while strengthening record keeping, monitoring and information disclosure trails.

Additionally, the rules encourage accelerating green transition by upgrading equipment, optimising production processes, and implementing cleaner production and circular economy requirements.

Finally, they require reinforced training across the organisation, explaining the EEC’s liability mechanisms and operational rules at various levels, and establishing risk warning systems to manage environmental compliance risk on an ongoing basis.

Audrey Tao is a senior partner at Hylands Law Firm. She can be reached by phone at+86 138 1678 0572 and by mail at audrey.tao@hylandslaw.com
Shen Haixiang is a senior partner at Hylands Law Firm. He can be reached by phone at+86 139 1189 3350 and by mail at shenhaixiang@hylandslaw.com