Proposal for changes to the Water Law

Ex. No. 512-00-512

Mr. BOYKO BORISOV

PRIME MINISTER

OF THE REPUBLIC OF BULGARIA

 

MRS IVELINA VASILEVA

MINISTER OF THE ENVIRONMENT

ENVIRONMENT AND WATERS

 

Mr. STANISLAV IVANOV

CHAIRMAN OF THE COMMISSION ON

ENVIRONMENT AND WATERS

 

SUBJECT: Proposals for changes to the Water Law

 

DEAR MR BORISOV,

DEAR MRS VASILEVA,

DEAR MR IVANOV,

With this letter, we express our position in support of the initiative of the Association of Non-Alcoholic Beverage Manufacturers in Bulgaria, a collective member of the Confederation of Employers and Industrialists in Bulgaria, to include additional changes in the bill amending the Water Law discussed by the government.

In order to achieve the goals of the legislative initiative, namely the removal of inconsistencies with EU law and the integration of water management policy with those of the water sector, we consider it more than timely and necessary to include additional amendments to ensure the correct transposition and the effective implementation of European law and principles in the bottled water sector.

Our common understanding with APBNB is the urgent need for a revision of the legislation, to remove the gaps and defects in the current regulation, which has been proven to create precedents of effective violations of EU law and opportunities for future multiplication of non-compliant practices.

The changes proposed by the business are aimed at promoting fair competition, ensuring transparency and predictability, and applying the principles of the rule of law in the process from providing access to a resource to the final phase of offering bottled water on the market. These include: introduction of the "one deposit - one bottler" principle for both mineral and spring waters; introduction of the principle "one deposit - one trade name"; introduction of the missing legal definitions of "mineral water deposit" and "spring water deposit"; introduction of a clear regulation to eliminate non-conforming practices. The changes are a guarantee of unified application of the legislation and their adoption will lead to at least the following positive results:

harmonization of national legislation and proper implementation of Directive 2009/54/EU in relation to the stated principles;

improving the business environment through transparency, predictability and increased investment protection;

preventing unfair competition among bottling companies and reducing corrupt practices;

increasing investment from existing and future investors;

support for the realization of the potential and expansion of the market positions of the Bulgarian bottled natural waters on the national European and world markets;

On the occasion of the draft Law on Amendments and Supplements to the Water Law published in the portal for public consultations, in support of the Association of Non-Alcoholic Beverage Manufacturers in Bulgaria, we propose to include additional amendments in the bill.

The proposed texts are directly related to the need for a precise transposition of European legislation in the field of regulating the management of mineral and spring waters with potable qualities in their natural form and ensuring the integration of water policy and policies in sectors in the water sector, such as the bottling of natural waters. Our specific proposals boil down to the following:

Paragraphs 47, 12 and 13 are created in Article 14 with the following content:

"(12) It is prohibited to place on the market natural mineral water extracted from one deposit, regardless of the number of its natural springs or artificially constructed water sources, under more than one trade name or without a trade name.

(13) The requirement under para. 11 also applies when granting permits for water abstraction from underground waters under Art. 44, para. 1 for the purpose of bottling spring water within the meaning of the Food Act and the regulation under Art. 4b of it, since more than one permit for the purpose of bottling cannot be granted from the same source of spring water.

(14) It is prohibited to place on the market spring water extracted from one deposit, regardless of the number of its natural springs or artificially constructed water sources, under more than one trade name or without a trade name.";

The following amendments are made to Article 49, Paragraph 2:

"(2) Public interests are also violated in the production and distribution in the commercial network of bottled spring and/or natural mineral waters, carbonated or other beverages, the composition of which includes spring and/or mineral water, without the corresponding certificate, without legal grounds and not according to the law, including when it is in violation of the principles of Art. 47, para. 11, paragraph 12, paragraph 13 and paragraph 14.";

Art. 56 and Art. 102"a" are supplemented and amended as follows:

3.1. A new paragraph 8 of Art. 56:

"(8) In addition to the requirements under paragraph 1, the permit for water withdrawal for the purpose of bottling and offering spring water on the market shall specify the trade name under which the spring water will be offered on the market:

3.2. In Art. 102a the following amendments and additions are made:

1. In para. 2:

a) a new item 16 is created:

"16. the trade name (trade mark) under which the bottled natural mineral water will be offered on the market, in cases where the water intake is intended for bottling natural mineral water under Art. 47, para. 2 item 1.”

b) previous point 16 becomes point 17;

2. In para. 7, item 2a is created:

"2a. the trade name (trademark) under which the natural mineral water from the deposit, subject of the concession, will be offered - in cases where the water abstraction is intended for bottling of natural mineral water under Art. 47, para. 2 item 1.";

In the additional provisions in § 1, paragraph 1, new items 96 and 97 are created to introduce definitions of the concepts "mineral water deposit" and "spring water deposit":

"item 96. "mineral water deposit" is an underground body of water containing mineral water and includes water that appears on the surface from a source exploited by one or more natural or water-receiving facilities-derived points of exit to the surface.

Item 97. "spring water body" is an underground water body and includes water originating from one or more aquifers with fresh groundwater, extracted from one or more artificially constructed aquifer facilities, characterized by a certain condition and assessed as suitable for drinking use in its natural state in compliance with the requirements of the Food Act."

New paragraphs are created in Transitional Provisions:

"§ ….. (1) Within 30 days after the entry into force of this law, the authorities that issued permits for water abstraction and bottling of spring water shall cancel the permits that are not the first for the respective deposit.

(2) The consequences of the cancellation of the permits specified in para. 1 shall be settled according to the general order.

§….. (1) The permits issued before the entry into force of the law under Art. 47, para. 13, which are the first for the respective deposit, remain in force until their expiration date.

(2) After the expiry of the permits specified in para. 1, new permits shall be issued to the holder of the permit whose term has expired in the event that, during the term of the original permit, significant violations of the conditions of the initial permit have not been established in the proper manner."

REASONS:

The current system of norms and rules does not guarantee compliance with European legislation on natural mineral and spring waters and the achievement of its goals. There is a lack of integration between the separate acts, comprehensively regulating the requirements for operators in the process from access to a resource to the final product and the rules that are followed when offering bottled water on the Single European Market. The provisions of the Water Law and the water resource management policy do not take into account the complex of requirements and objectives of the legislation in the field of food. Respectively, there is a lack of synchronization in the legal requirements and in terms of the rules for the protection of the developed brand operators, subject to strict requirements of specific European legislation. Although individual competent authorities and administrative structures claim to have achieved compliance with European regulations, practice proves the actual impossibility of this obligation for our country as an EU member state.

For many years, natural water bottling business operators have been transferred from institution to institution - each with its own understandings and interpretations, justifying its decisions within the legal competences of separate and inconsistent rules. Each administration driven by its own motivation and goals.

In its desire to strictly comply with the set of requirements and successfully develop its activity, the business is placed under constant threat from the adoption of decisions and measures, incl. legislative initiatives that put at unjustified risk the considerable long-term investments made in the development of the field and the imposition of the product on the market. Decisions that most often lead to a dishonest business environment, unfair competition and opportunities for corruption. Decisions that create precedents in violation of European law and principles.

Lack of integration characterizes the business environment, not only as inconsistent with that established in other EU Member States, but also as highly risky and unsustainable, unattractive for investments and creating barriers to the effective development of fair trade and realization of the potential in the sector of bottled natural mineral and spring waters.

Access to a resource is at the heart of the bottled natural water business. In order to carry out a sustainable economic activity in the sector of bottled natural waters, the legal framework must create an adequate regulation and clear, transparent and integrated rules for providing access to a resource with the express purpose of bottling, which guarantee compliance with the requirements of European regulations in the sector (Directive 2009/54/EU).

The only model of water resource exploitation established in the EU, which guarantees the achievement of the goals and regulations of European legislation and which practically lies at the basis of the successful development of the most powerful industry in the sector - is to have only one responsible business entity in one location , to develop its own unique brand and ensure the protection of the interests of consumers and the state.

The package of legislative changes proposed by the business in the Water Act introduces the principle of "one deposit - one bottler - one trade name" for both categories of water (mineral and spring) even when providing a resource for the purpose of bottling. It creates the clear rules, transparency and predictability that businesses need. At the same time, we are convinced that, as the only instrument ensuring the effective implementation of European regulation, it is a strong guarantor for protecting the interests of consumers and the state.

As a responsible partner of the state, incl. in the process of developing the legislation, the Association has presented its legitimate claims for the revision of the legislation many times over the years, but instead of finding sustainable and successful solutions in dialogue with the interested parties, the problems remain open and deepen.

Based on the Government's stated will for serious changes in the economic situation in the country and the removal of existing obstacles to business, we believe that the proposed absolute minimum of the most priority changes for the sector will be supported and will be included in the initiated amendments to the Law for the waters.

In conclusion, we would like to note that the problems presented above and the proposed mechanism for their permanent solution do not exhaust the obstacles identified by the business, which hold back the development of the sector, limit investments and, as a result, do not ensure the shared expectations of the state and business. The extremely imperative and sustainable establishment of the principle "one deposit - one bottler - one trade name" is a basic fundamental condition for the functioning of the sector. The association is ready to provide its proposals for an additional minimum package of legislative changes, defined on the basis of extensive analyzes and researched practices. The main areas in which we believe that legal change is needed in the shortest possible time are:

Stimulating investments and private initiative in the sector by reducing financial and administrative barriers;

Creation of additional guarantees for unified application of the requirements of the law, incl. through enhanced control;

Creating more publicity and transparency in resource management;

Improving coordination between institutions along the chain from the resource to the final product.

The goals of the legislative amendments proposed by the business are divided into the following directions:

Achieving integration of regulations applicable to the sector and creating predictability and sustainability of the business environment in the water bottling sector as a fundamental condition for its functioning and successful development;

Creation of legal guarantees for strict and unified application of European legislation and application of clear rules when providing access to a resource for the purpose of bottling and offering on the market natural mineral and spring water;

Promotion of fair trade and investment in the sector. Creation of prerequisites for successful realization of the potential and increased efficiency in the use of the resource;

Increasing transparency in the implementation of the natural resource management policy and coordination in the actions of the competent regulatory and supervisory authorities along the chain from the resource to the final phase of market offering.

In support of the stated position "one deposit one bottler" we apply the opinion of the European Federation of Bottled Water and Industry, from which it is clear that the changes we propose in this direction are fully in line with European practice.

Application according to the text

With respect,

Eugene Ivanov

Ex. director