Sustainable development in the environmental area has become an important goal both nationally and internationally. The public sector implements policies that support continuing  environmental conservation. The SEC, as a capital market regulator, encourages the use of capital market products to support investments in projects that conserve or protect the environment, including the development of areas designated for reforestation or afforestation to promote environmental development in Thailand. This involves promoting and supporting investors whose goal is to invest in sustainable environmental development and increasing funding sources for those who intend to raise fund from onshore lands legally designated for reforestation or afforestation such as farmers and communities capable of converting such lands to securities. 

In this regard, in January 2024, the SEC Board and the Capital Market Supervisory Board (CMSB) approved in principle the issuance of regulations to facilitate the use of an investment trust as a vehicle to support investment in environmental projects. The key characteristics of this Green Investment Trust are summarized as follows:

(1) The investment policies shall be indicated to lands onshore that have already been used for the purpose of afforestation or reforestation and registered with Thailand Greenhouse Gas Management Organization (TGO) on Thailand Voluntary Emission Reduction Program* or other internationally recognized verified carbon standard programs;  

  (2) The revenue shall mainly come from selling carbon credits;   

(3) The appraisal of invested assets shall be creditable and be in line with the academic standards, and an aggregate value of such assets shall not be less than 75 percent of the total value of the trust units offered for sale, including the amount of loan. (if any);  

(4) In accordance with the structure of the Green Investment Trust, the trustee shall be responsible for conserving the Green Investment Trust’s assets, selecting and appointing the trust manager, as well as overseeing the trust manager’s performance of duties as prescribed in the trust deed;

  (5) Only institutional investors and ultra-high net worth investors* shall be eligible as the investment in the Green Investment Trust may extend over a long period of time and exhibit volatility in its returns.

The consultation paper is available at https://www.sec.or.th/TH/Pages/PB_Detail.aspx?SECID=975. Stakeholders and interested parties are welcome to submit comments and suggestions through the website or email: fundraisingpolicy@sec.or.th. The public hearing ends on 18 March 2024. 

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Remark:

* This program aims to conduct either the afforestation or reforestation with the purpose of absorbing CO2. 

** Institutional Investor and Ultra-High Net Worth Investor are as defined in the Notification of the Securities and Exchange Commission No. Kor Jor. 39/2564 Re: Determination of Definition of Institutional Investor, Ultra-High Net Worth Investor and High Net Worth Investor, dated 24 December 2021.