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Good practice Imported

Bosnia and Herzegovina's Fragmented General Forest Functions Fee

Bosnia and Herzegovina · Sarajevo · See the Bosnia and Herzegovina profile · See the Sarajevo profile

Evidence: Descriptive / self-reported Top 99% 13/100 · Ask Evidence Copilot about this practice

A timber levy funding forests' "general beneficial functions" is uniform in Republika Srpska (10% of roadside timber value) but fragmented across FBiH cantons (4-9% of stump price); RS collected 48.4M KM in 2023 versus 15.8M KM in the Federation on similar harvest volumes.

10 % of roadside timber value
Republika Srpska forest-functions fee rate
4-9 % of stump price
Federation of BiH cantonal fee rate range
48.4 million KM
Republika Srpska fee revenue, 2023 (2023)
15.8 million KM
Federation of BiH fee revenue, 2023 (2023)
Bosnia and Herzegovina's Fragmented General Forest Functions Fee

Details

Maturity
Established
Promoter
Government of Republika Srpska (Ministry of Agriculture, Forestry and Water Management) / Cantonal Governments of the Federation of Bosnia and Herzegovina
Period
2009-present
Keywords
forestry finance, decentralised levies, institutional fragmentation, public forest law

Context

Both entities of Bosnia and Herzegovina levy a compensation charge on commercial timber harvesting to fund forests' 'general beneficial functions' — erosion control, water regulation, biodiversity and recreation — a concept inherited from former Yugoslav forestry law and mirrored in similar levies in Croatia and Serbia.

Objectives

The fee is intended to generate dedicated revenue for forest ecosystem services, but the two entities apply fundamentally different governance models: a single, standardised rate in Republika Srpska versus ten separately-set cantonal rates in the Federation of BiH.

Activities

Republika Srpska applies a uniform entity-wide rate of 10% of revenue from timber sold at the forest-road price, collected under a standardised calculation, collection and distribution method across all municipalities. The Federation of BiH, lacking a unified forestry law since 2009, leaves each of its ten cantons to set its own rate on the (typically lower) stump-price base — for example 9% in Una-Sana Canton versus 4% in Central Bosnia Canton.

Results

Republika Srpska collected 48.4 million convertible marks (KM) in 2023. Despite comparable logging volumes, the Federation collected only 15.8 million KM in 2023 — under a third of Republika Srpska's total — a gap investigative reporting attributes to the lack of a harmonised legal framework and canton-by-canton administrative fragmentation.

Conclusions

No public ex-post evaluation was found quantifying the ecological outcomes (afforestation, erosion control, biodiversity gains) actually delivered by either entity's fee revenue — the well-documented fact is the fee collected, not the ecosystem service produced. The Federation's shortfall illustrates a governance risk common to decentralised, PES-like levies: fragmentation can erode both the revenue and the accountability needed to fund forest ecosystem services at scale.

Implementation
Indicative cost
High (€500k–€5M) — Based on 2023 collection figures (48.4 million KM in Republika Srpska; 15.8 million KM in the Federation) — a nationally significant, tens-of-millions-of-KM annual revenue mechanism.
Time to results
Long (> 3 years) — Federation fragmentation dates to the lapse of its unified forestry law in 2009; the levy mechanism itself is open-ended, ongoing national infrastructure.
Staffing & skills
Government of Republika Srpska (Ministry of Agriculture, Forestry and Water Management), Ten cantonal governments of the Federation of Bosnia and Herzegovina

Conditions for success

  • A standardised, entity-wide calculation, collection and distribution method, as used in Republika Srpska
  • A unified forestry law that prevents canton-by-canton rate fragmentation

Common failure modes

  • Federation of BiH has had no unified forestry law since 2009, leaving ten cantons to set independent rates on a lower revenue base
  • Comparable harvest volumes yielded under a third of the revenue in the Federation compared with Republika Srpska in 2023
  • No public evaluation quantifies whether either entity's fee revenue has actually delivered the erosion-control, water-regulation or biodiversity outcomes it is meant to fund

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Data sources

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