Court Ruling Prompts Ecology Regulations
5/11/97
*******************************
RELAYED TEXT STARTS HERE:
Headline: Court Ruling Prompts Ecology Regulations
Source: Earth Times News Service
Date: 5/11/97
Author: Heather Walsh
(c) Earth Times News Service
Court ruling prompts ecology regulations
HEATHER WALSH
ANTIAGO, CHILE--The Chilean government has
passed a new regulation making environmental
impact studies (EIS) obligatory for new industrial
projects that may harm the environment. As a result,
some large projects that were previously approved by the
government could now end up in court.
"The regulation is a benchmark in our country's
environmental law," says Vivienne Blanlot, head of
CONAMA, the government's environmental authority. "It
will better prevent the unwanted environmental impact of
development."
The government set up CONAMA in the early 1990s and gave
it the task of reviewing all potentially contaminating
new projects on the basis of EISs submitted by
companies. The trouble is EISs were voluntary until now
- so any number of dubious projects could have slipped
through the government's net, loose as it was.
Chile is well-endowed with natural resources - from
fertile valleys to water resources and minerals - making
it one of the top destinations of international
companies. But many projects have been environmentally
harmful and the government has often had to answer
charges by campaigners that it had little real
willingness to challenge the private sector on
environmental issues.
There is a classic dilemma here. As with many other
developing countries, the Chilean government too may
have been concerned about scaring off new investment:
foreign investment reached $6.17 billion in 1996,
compared to $4.33 billion in 1995. And almost
three-quarters of all 1996 investment ($4.59 billion)
was directed at plants and machinery - just the sector
that so alarms environmentalists.
It needed a court verdict to change all that. The
Supreme Court in March this year overturned government
approval of a forestry project and questioned CONAMA's
legal authority and effectiveness, forcing the
government to pass the new regulation in April.
The case involved a $200 million-project run by the
Washington-based Trillium Corporation to harvest and
mill lenga - a cherry-like fine wood - native to the
Tierra del Fuego region.
The company, anxious to start the project this August,
put in an EIS under the former voluntary system. A
government technical committee which reviewed the study
found serious gaps - saying, for instance, that the
company had not specified where or how much wood it
planned to cut. Somehow, despite the dim review,
Trillium was approved, upsetting environmentalists who
went to court to try to stop it.
In theory, the Supreme Court ruling has thrown into
question the legality of over 100 other projects
approved by CONAMA before the new regulation came into
being. Last year alone, CONAMA approved $3.4 billion in
new projects. But only a few controversial and
high-profile projects are likely to be challenged.
Fernando Dougnac, an environmental lawyer who won the
Trillium case, is now opposing a one billion dollar-pulp
plant planned by one of Chile's biggest forestry
producers and an electricity plant in Santiago being
developed by the country's second largest electricity
generator. Some other forestry projects too are likely
to be affected, according to Juan Eduardo Correa of the
Association of Lumber Producers.
Campaigners interpret the ruling as allowing litigation
not only by people who are directly affected by
projects, but also outsiders. Before it, only those
people who were directly affected by a scheme - like
those living near one - could make an effective claim.
"The ruling gives citizens the right to file an
injunction against a project when the government doesn't
fulfil its obligations to protect the environment," says
Dougnac. "The ruling said the environment is the
heritage of all citizens."
Business and industry are fuming over the ruling. Pedro
Lizana, President of Sofofa, the manufacturing
association, says it undermines the credibility of the
government and creates "an atmosphere of incredulity on
the part of the private sector."
And Trillium Corporation said on March 20, "We invested
in Chile for its political and economic stability and
for its interest in establishing clear guidelines to
protect the environment as well as an unrestricted
respect for private property. Nevertheless, we find
ourselves ensnared in a legal dispute....Investors and
the environment are left unprotected."
The judgement comes just as another high-profile
proposal by one of Chile's biggest companies awaits the
CONAMA stamp.
The top electricity generator, Empresa Nacional de
Electricidad SA, Endesa, wants to build the second of a
series of hydroelectric plants on the BioBio River in
Chile's eighth region, which starts some 400 km south of
Santiago. The first 450 mw-dam, called Pangue, is
already up and running. Preliminary work has started on
the second, larger dam upstream, called Ralco.
Both have met with fierce opposition from campaigners
who say the dams will destroy unique flora and fauna and
threaten the culture of the indigenous Pehuenche
community.
Even the World Bank's International Finance Corporation
(IFC), principal lender for Pangue, is unhappy - it has
threatened to declare Endesa in default on a remaining
$150 million in loans, saying the company is not meeting
agreed environmental and social conditions.
Meanwhile, unlike in its efforts to create a consistent
national environment policy, the government appears to
be making some headway on a plan to implement
international standards for environmental management.
It is preparing to put in place the International
Standard Organisation's ISO 14,000 series of voluntary
standards on environmental management and auditing
systems. It also plans to accredit companies which have
integrated the standards.. The norms mainly concern the
mining, fishing and forestry industries, which want to
export to countries where these are compulsory.