Environmental Technologies Industries

Environmental Technologies Industries

Market Plans

Chile Environmental Export Market Plan

II-Legal and Regulatory Framework

Legal and Regulatory Framework

The 1980 Constitution laid the foundation for environmental protection in Chile. It guarantees the citizens of Chile the right to live in a clean environment. This provision was translated into an umbrella law in March 1994. As its name suggests, the Environmental Framework Law (Law No. 19,300) provides a general structure for environment regulation. It covers a broad range of issues from environmental risk and impact assessment to natural resources stewardship and pollution prevention and control for all media. In addition to providing a legal basis for environmental protection, the law created an agency responsible for coordinating environmental policy, instituted a “polluter pays” principle to hold polluters liable for environmental damages, established mechanisms for public participation, and created the Fund for the Environment.
The law both updated some of the traditional mechanisms for environmental protection (e.g., environmental quality standards) and established some that had not previously been used in Chile, including EIAs. The key instruments are the following:

Regulatory Process for Establishing Environmental Conditions. Environmental quality and discharge standards are traditional mechanisms for environmental protection that have been in use for some time on a sectoral basis. The law essentially updates the process for promulgating environmental quality standards, discharge standards for air and water, and standards for solid waste management and natural resource conservation. All standards must be established by Supreme Decree from the Office of the President and must undergo a rigorous technical and economic evaluation.
Environmental Impact Assessments. To prevent environmental damage, the law established a requirement for environmental impact assessments for all major projects or activities. The EIAs must receive approval through a process that involves the regional environmental authorities and municipalities, and the assessments also provide an opportunity for public review and input. EIAs can be approved, rejected, or conditionally approved. Conditional approval generally outlines specific conditions with which the project must comply. This aspect of the law went into effect in 1997.
Use of Economic Instruments. For environmental management, the law permits the use of economic instruments such as tradeable permits, pollution charges, and user fees. A tradeable permit program for particulates is currently being implemented in Santiago.
Establishment of a National Information System. The law mandates the establishment of a regional information system for environmental management.

Another new feature of the law that is linked to the EIA process is the establishment of a one-stop permitting process called ventanilla unica. This process is designed to facilitate environmental compliance by coordinating under one permit all activities related to the environmental impacts of a specific project. Before promulgation of the law, industries had to obtain permits for a new activity (e.g., construction of a wastewater treatment plant) from all the various local, regional, and national agencies that had authority over some aspect of the project. This process often could take up to a year and involve up to 20 different agencies. Under the new system, the 13 Regional Environmental Commissions (COREMAs) solicit the input of all the appropriate agencies during the EIA process. Once the EIA is approved, no state agency can deny authorization for the project in question on environmental grounds, and the industry receives a single permit allowing it to go forward with the project. Only projects that go through the EIA process are eligible for this permit; others must still obtain permits from all the appropriate agencies.

Institutional Structure for Environmental Management

Chile does not have a centralized government agency with legislative and enforcement authority for the environment. Instead, each ministry is responsible for establishing environmental standards in the sector it regulates. To coordinate and manage the country’s environmental policies and programs, the Environmental Framework Law established the National Environmental Commission. CONAMA is an agency under the Office of the President. CONAMA’s Council of Directors is composed of the General Secretary of the Presidency and the heads of the 11 ministries (see figure 1). Although each ministry is tasked with the development and implementation of environmental programs in their area of oversight, CONAMA’s Executive Unit is responsible for developing overarching policy and coordinating the activities of the ministries to ensure that programs are being carried out effectively. CONAMA does not have enforcement responsibility.
In addition to the national coordinating agency, there are similar agencies for each region: the Regional Environmental Commissions (COREMAs). Each COREMA has a Council of Directors and an Executive Unit. The Council of Directors is made up of a regional representative of the Office of the President, the Governor, the regional secretaries of the 11 ministries, and four advisors. The Executive Unit, responsible for coordinating environmental activities, is supported by a technical committee. Specific functions of the COREMAs include 1) coordinating regional environmental management, 2) evaluating EIAs, 3) enforcing the provisions of conditionally approved EIAs, and 4) developing and implementing regional decontamination plans. In addition, CONAMA and each of the COREMAs have an advisory committee composed of two representatives from the scientific community, nongovernmental organizations, industry, and labor, and one representative from the Office of the President. To ensure coordination among policies at the national and regional levels, the director of each COREMA sits on the Executive Unit of CONAMA.
For the most part, both CONAMA and the regional agencies are young institutions and lack sufficient financial or technical resources to carry out their responsibilities. CONAMA’s 1998 budget was $26.5 million, up 45 percent from the previous year. The agency has a professional staff of 25 (excluding the directors) and relies extensively on external consultants to conduct specific studies. Likewise, each COREMA faces two serious challenges: an overextended and inexperienced staff, which limits the commissions’ ability to carry out basic responsibilities, much less proactively investigate and prosecute environmental violations; and a lack of direct enforcement responsibility, forcing each COREMA to rely on regional offices of the ministries to ensure that regulations are met.
While all 11 ministries that sit on CONAMA’s Executive Unit are responsible for carrying out the environmental programs within their jurisdictions, the principal Chilean ministries with environmental management responsibilities include the following:

The Ministry of Health. The Ministry of Health has the broadest range of environmental responsibilities and is involved in all activities that affect public health. In addition to the regional offices of this ministry, there is a Health Service Agency with an office in each region. Within the Health Service, an Environmental Department has primary responsibility for implementing the environmental policies and programs tasked to the Ministry of Health. It also has the authority to enforce regulations related to environmental health. Despite its broad environmental authority, the Health Service’s primary focus is public health. In the metropolitan Santiago region, a separate agency, the Metropolitan Environmental Health Service (SESMA), has been established. SESMA is dedicated to carrying out environmental programs and is directly dependent on the Ministry of Health. Its annual budget for 1997 was $12.5 million.
Superintendency of Sanitary Services (SSS). Under the Ministry of Public Works, this agency is responsible for overseeing municipal and industrial wastewater management in Chile. This includes developing effluent standards and guidelines for the design, construction, and operation of sanitary services, and industrial wastewater management. This agency is also responsible for enforcing water regulations.
The Ministry of Transportation. This ministry has been most active in developing programs to address air pollution from mobile sources in the metropolitan region, including programs to limit the number of vehicles in circulation during the work week and to improve public transportation.

Other agencies with environmental jurisdiction include the Office of Marine Territory, which is part of the Chilean Armed Forces; the National Mining and Geological Service, which regulates mining and falls under the Ministry of Mining; the Agricultural and Cattle Service, under the Ministry of Agriculture; and the Subsecretary of Fisheries. Although environmental protection has increasingly become a national priority, many of these agencies still lack the staff, budget, and expertise needed to adequately implement environmental programs.

Enforcement Trends

Although the enactment of the Environmental Framework Law in 1994 has brought environmental issues to national attention, enforcement remains spotty. The Environmental Framework Law establishes three types of sanctions: 1) reprimand, 2) fines, and 3) temporary or permanent closure of a facility. CONAMA does not have the authority to enforce regulations; however, it can suggest that a ministry with specific jurisdiction take a particular course of action. Enforcement is most effective when public health may be threatened, such as in the case of air pollution problems or industrial wastes. During the last six months of 1997, close to 100 facilities were shut down in themetropolitan region and along the coast for air pollution violations, and 20 chemical, electroplating, and tannery facilities were shut down for industrial effluent violations. In addition, more than 100 clandestine dumps have been shut down in the metropolitan area. Companies are recognizing that they will at some point be required to comply with environmental standards and are beginning to take measures to avoid sanctions.

Figure 1: Institutional Structure for Environmental Management in Chile

	*Office of the President*
	\|
	CONAMA-Council of Directors General Secretary of the Presidency (President of CONAMA) Heads of 11 Ministries
National	\|
	CONAMA-Executive Unit Executive Director 20 Directors (including Directors from COREMAs) 25 Professional Staff	*------------------------*	Advisory Council 2 Scientists 2 NGO Representatives 2 Academics 2 Industrial Representatives 2 Workers 1 Representative from the President's Office
	\|
	*\|-------------------------*	Operational Committess
	\|
	\|
	COREMAs-Council of Directors Representative from the President's Office Governor 4 Regional Council Members Regional Representatives of the Ministries Executive Director of COREMA
Regional (1 in Each Region)	\| \|
	COREMAs-Executive Unit	*------------------------*	Advisory Council 2 Scientists 2 NGO Representatives 2 Academics 2 Industrial Representatives 2 Workers 1 Representative from the President's Office
	\|
	Technical Committee

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