The following is a brief description concerning the main reforms proposed by the Water Code Amendment draft bill.

Water rights are essentially temporary

The substitute observations presented by the Executive Branch to the bill which reforms the Water Code, stipulates a change of conception regarding the current system.

Nowadays, water rights are considered to be a property right; with a perpetual character, over the waters and consist in its use and enjoyment.

The Government’s proposal, on the contrary, pretends that the granting of new water rights, shall have a temporary extension limited to a 30-year maximum, extendable, unless the General Water Bureau certifies the non-effective use of the resource, in which case the rights expiration grounds will operate, contemplated in this very instrument. 

Nevertheless, the proposal contemplates a minimum length of 20 years for non-consumptive water rights.

Redefinition of water rights concept

According to the substitute observations presented by the Executive Branch, the water rights concept is redrafted, removing its property right quality and the express ability of its disposal (notwithstanding other rules that will be kept which implicitly allows for,  this ability), and transforming it into an administrative concession over the waters which will allow its temporary use and enjoyment, in accordance with the rules, requirements and limitations prescribed by the proposal of the new Water Code.

In this regard, the proposal is not clear about the possibility to transfer or transmit water rights.

Water rights expiration

The executive proposal considers water rights expiration grounds, which will operate by operation of law. In theory, if the effective use of the resource is not verified within the next terms, it operates automatically and without a judicial declaration, depending on the characteristics of the rights:

  1. Consumptive water rights: a non-use certification is needed for a 4-years term, calculated from its granting.
  2. Non-consumptive water rights: a non-use certification is needed for a 8-years term, calculated from its granting.

The project also establishes that the effective water usage that allows for the avoidance of the expiration, “will be confirmed” (without indicating before which agency nor through which prior procedure) through the construction of sufficient and suitable works able to permit the extraction or collection of the water, its conduction to the using point and the restitution of the resource (this last point, in the case of non-consumptive rights).

Additionally, for non-consumptive rights cases, the indications include the expiration of non-consumptive rights as a sanction, by operation of law, if, over 14 years, the right owner has not built the collection and extraction works. For consumptive rights of permanent exercise, the expiration as a sanction (by operation of law) will apply if the respective collection works have not been built in a 12-year term since its granting. 

Finally, the proposal includes the water right expiration if the public deed, in which the granting act has been reduced, has not been registered in the Water Property Register of the Real Estate Registrar within 60 days.

Limitation to water rights exercise

The Executive Branch’s indications proposed water rights limitation, according to public interest, for which it is intended to entitle the Administration, the following abilities:

  1. Temporary reduction of water rights.
  2. Water redistribution.

Likewise, the granting of water rights in glaciers is expressly forbidden.

Protected areas

The Executive Branch’s proposal expressly considers the prohibition of granting water rights in protected areas that have been declared National Park and Reserves in a Virgin Region.

Regarding other declared protected areas, such as National Reserves, Nature Sanctuaries, Natural Monuments and International Care Wetlands, water rights shall remain consistent with the aim of the protected area category and its respective management plan, which shall be determined prior the report of the Biodiversity and Protected Areas Service, which will be created for this purpose.

Priority water usage

The Executive Branch’s indications establishe priority water usages, that shall prevail both in the granting and in the limitation of water rights exercise. Such priority uses are:

  1. Subsistence or water usage destined to human consumption; or
  2. Water sanitation.

In this way, if two or more applications exist for granting water rights over the same waters, presented within 6 months and without the possibility of fulfilling all of them, and one or more of them refer to usage related to subsistence, these last shall have preference over the others, general auction rules being inapplicable.

Likewise, it is established that the General Water Bureau must subject itself to this priority rules by providing the temporary exercise reduction of the water rights or water redistribution, abilities that shall only be used in favor of public interest.

On the other hand, in order to ensure such usage, it is proposed to allow the State the constitution of surface and underground water reserves, over which it may grant concessions in order to satisfy the subsistence needs. These concessions will be ruled by special rules that will ensure the usage for which they were granted.

Finally, even in cases of non-availability of the resource, with the aim of ensuring water access for human consumption, it is proposed that, exceptionally, Rural Committees of Potable Water will be allowed to grant transitory rights.

Changes in the usage of water rights

The substitute indications presented remove the rules whereby water rights are not subjected in any way to the use or destination pointed in the explanatory memorandum that must be attached in the relevant constitution or granting procedure, which leaves in doubt the possibility of implementing this change of usage or destination and the terms and conditions applicable to it.

Fee for non-use of water rights

For non-consumptive permanent exercisable water rights, the Executive Branch’s proposal considers a rise in the charging of a fee for non-use of water rights, which is double of the amount considered in the current Water Code.

The indications consider the exemption for the payment of the fee for non-use only regarding the Rural Associations of Drinking Water.

Finally, a modification to the auction procedure of water rights is proposed, for cases of non-payment of the fee for non-use.

Effect on former water rights

The water rights granted before the entry into force of the Executive Branch’s proposal will remain current, but subject to the limitations and restrictions used in favor of public interest. Even so,  the rules regarding its expiration will not be applied to these rights.

Effect on non- regularized water rights

The substitute indications presented by the Executive Power establishes a one year term, counted from the date the modification entered into force, for the presentation of applications of regularization of water rights that can be regularized. This includes registered water rights that are under use by different people other than the rights owners, or, those that are not registered and comply, in both cases, with the requirements of having been used uninterruptedly, free from violence and clandestine use and without recognizing foreign domain since, at least, October 29th, 1976.

Water rights owners that have not presented the respective applications within the pointed term will lose the power to do so, leaving the status of these in doubt once it has passed.

Report of the Committee of Agriculture, Forestry and Rural Chilean Development in the Water Code Reform Law Bill