The transaction costs borne by the private sector may be classified as either administrative costs, substantive compliance costs or delay costs (VCEC, 2009). Administrative costs are the costs of compliance with the administrative procedures and tend to comprise only a relatively small proportion of transaction costs in biodiversity offset schemes. Substantive compliance costs are the costs incurred by a firm to comply with regulation, they are not directly levied by the regulator, but are at least as important to the efficiency of implementation.