Environmental offsets seek to ensure that unavoidable adverse environmental impacts of development are counterbalanced by environmental gains, with the overall aim of achieving a net neutral or beneficial outcome. In line with sustainable development, offsets represent one important tool for maintaining or enhancing environmental values in situations where social and economic development is sought despite detrimental environmental impacts. Offsets are generally intended as an option for addressing residual environmental impacts of development, after efforts have been undertaken to avoid and minimize impacts. This report is intended as a foundational document that, by providing a review of selected legal, regulatory, and policy frameworks governing offsets, supports the Program's wider goal of developing a toolkit of offset "how to" materials. The paper has been prepared as a discussion document for the Biodiversity Offsets Program Meeting to be held in Washington D.C. from June 6-8, 2005.