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bibo:abstract "Environmental damage from industrial greenhouse gas emissions has become one of the most pressing legal challenges of the 21st century. Environmental law recognizes the Polluter Pays Principle , which obliges the polluting party to bear the costs of environmental recovery. In Indonesia, Polluter Pays Principle is accommodated in Law No. 32 of 2009 on Environmental Protection and Management and operationalized through the Economic Value of Carbon (NEK) policy under Presidential Regulation No. 110 of 2025, implemented via cap-andtrade schemes and carbon tax under Law No. 7 of 2021. However, its effectiveness remains contested, particularly regarding greenwashing risks and weak enforcement. This research examines Polluter Pays Principle application in Indonesia’s carbon trading from the perspectives of positive law and Islamic Economic Law. This research employs a normative legal method using conceptual and statutory approaches. Secondary data was collected through library research and analyzed qualitatively. Two theoretical frameworks were applied: the Theory of Legal Certainty by Gustav Radbruch, Lon L. Fuller, and Hans Kelsen to assess the predictability and consistency of carbon trading regulations; and the Theory of Maṣlaḥah Mursalah from the Uṣūl al-fiqh tradition of Imam al-Ghazali, asy- Syatibi, and contemporary scholars Yusuf al-Qaradawi and Jasser Auda, to evaluate the conformity of carbon trading with objectives of Islamic law and the principle of public benefit. The research yields two main findings. First, Indonesia’s carbon trading regulatory framework has an adequate normative foundation, yet remains weak in substantive legal certainty: ambiguous technical provisions, inconsistencies between carbon tax policy and ongoing fossil fuel subsidies, and a significant gap between written norms and field implementation as reflected in low IDXCarbon transaction volumes and limited SRN verification capacity. Second, from the Maṣlaḥah Mursalah perspective, Polluter Pays Principle application in carbon trading is conceptually permissible under Islamic law, satisfying the three conditions of Maṣlaḥah Mursalah and aligning with the maxims of al-ghunm bi alghurm, la darar wa la dirar, and maqāṣid asy-syarī’ah especially ḥifẓ an-nafs and ḥifẓ an-nasl. However, this legitimacy is conditional: a merely administrative mechanism without real emission reductions does not fully satisfy genuine Maṣlaḥah. Strengthening MRV regulation, anti-greenwashing rules, policy harmonization, and carbon fund earmarking are essential."^^xsd:string;
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