New law establishes National Policy for the Rights of People Affected by Dams in Brazil

On December 15, 2023, the Brazilian President assented to Law No. 14,755/2023 (with certain vetoes), establishing the National Policy for the Rights of People Affected by Dams (PNAB). In effect since December 18, the law defines the rights of people affected by dams, provides for the contents of the Program for the Rights of People Affected by Dams (PDPAB), and establishes rules concerning the social responsibility of companies that own dam structures. 

Dams contemplated in the law

Law No. 14,755/2023 applies to dams within the scope of the National Dam Safety Policy (PNSB). These include dams that store water for various purposes, permanent or temporary tailings dams (including for mining), or industrial waste dams. They must have at least one of the following characteristics:

• A dam wall height of at least 15 meters;
• A total reservoir capacity of at least three million cubic meters;
• A reservoir containing hazardous waste (as per applicable technical standards); or
• Classified as having medium or high associated potential damage or classified as a high-risk dam (at the discretion of the supervisory body for dams in Brazil).

Furthermore, the law applies to the environmental licensing process of the dams mentioned above, as well as to emergency situations stemming from leaks or breaches of dam structures.

Congress had initially approved a provision that would have made the law applicable to existing and imminent situations. However, this was vetoed by the President – there were fears such a provision would lead to differing interpretations about the law’s temporal scope, potentially affecting past cases or ongoing environmental licenses and creating legal uncertainty.

People affected by dams

The law creates a specific definition of people affected by dams (Affected People), contemplating groups of people who, as a result of dam construction, operation, deactivation, or breaches, suffer at least one of the following consequences:

• Loss of ownership or possession of their property;
• Depreciated property value due to it being located close to downstream of the dam;
• Loss of productive capacity of their land;
• Loss of product or loss of fishing or natural resource management areas;
• Prolonged or permanent changes to the quality of their water supply;
• Loss of sources of income and employment;
• Changes in the affected people’s habits;
• Changes to indigenous and traditional communities’ way of life; or
• Disrupted access to urban areas and rural communities.

The original bill that Congress approved also provided for the possibility of the environmental licensing body to indicate other impacts within the definition of Affected People. However, this provision was also vetoed in the final text due to the potential legal uncertainty it could create.

Rights of people affected by dams

Under the PDPAB, Affected People have rights to various forms of reparations that take specific aspects of the affected groups, communities, families, and individuals into account. Reparations can take the form of replacing destroyed or damaged property, financial compensation, or compensation via other equivalent goods or events. There are also social reparations, which represent a further material benefit in relation to the other three forms.

The bill approved by Congress also provided for applying social reparations to immeasurable or hard-to-measure situations, such as the rupture of family and cultural ties, changes in habits, the destruction of communities’ traditional ways of life, moral damages, and psychological distress. However, these references were vetoed by the President in the final version of the law.

In addition to reparations, the law specifies that Affected People are also entitled to:

• Collective resettlement to preserve cultural and communal ties;
• Negotiate forms of reparation and related matters;
• Free and informed choice regarding reparation alternatives;
• Independent technical assistance;
• Emergency assistance in the event of accidents or disasters;
• Compensation for material damages;
• Reparations for moral damages – including collective damages;
• Resettlement and the implementation of related projects with suitable housing and common spaces;
• Register property resulting from resettlement;
• Implemented plans for economic and social recovery and development; and
• Access to information and public consultations, among others.

Furthermore, subsistence farming groups are entitled to reparations for material losses, compensation for displacement and intangible losses, and the establishment of technical assistance programs to aid in reconstructing their ways of life and social, cultural, and economic networks.

Program for the Rights of People Affected by Dams (PDPAB)

Whenever a dam meets the characteristics specified in Law No. 14,755/2023, a PDPAB must be created at the dam owner’s expense. This program must be submitted for approval to the local PNAB Committee, whose role is to ensure the rights established by the policy are upheld in practice.

Without prejudice to other provisions, the PDPAB must provide for specific segments within the population groups that may be affected by the dam – such as women, the elderly, children, people with disabilities, or those in vulnerable situations, as well as indigenous communities, traditional communities, domestic animals, and farm animals.

The program must also include specific provisions to address impacts on collective health, environmental sanitation, housing, and education; other areas affected by a potential dam breach or leakage; compensation for losses due to reservoir filling, dam breaches or leaks; fishers and fishing activities; communities that receive resettled people; and other activities and situations that are yet to be regulated.

PNAB: institutional arrangements

From an institutional standpoint, a national advisory and deliberative body will oversee and assess the formulation and implementation of the PNAB. This body will consist of representatives from the government, dam owners, and social movements linked to the Affected People.

Local PNAB committees with the same tripartite structure must also be established to oversee and assess each PDPAB. Representatives of the Public Prosecutor’s Office and the Public Defender’s Office may also participate in the meetings held by the national body and local committees.

For further information on this topic, please contact Mattos Filho’s Infrastructure & Energy, Environmental Law & Climate Change, and ESG practice areas.