The UNASUR treaty and EHS – Towards an integrated regional approach in South America

The regional approach to environmental, health and safety (EHS) matters has become a growing trend among companies. The signature of the Treaty establishing the Union of South American Nations (UNASUR) on 23 May 2008 rings the bell for companies operating in South America, as it creates a harmonized and integrated economic system impacting states and shareholders. Although UNASUR has not entered into force yet, some of the twelve signature countries have already implemented local EHS measures.  Nevertheless, UNASUR faces  a series of political difficulties and other obstacles that hinder its implementation. The repercussions that UNASUR might have on EHS remain uncertain; however, the current EHS developments in South American countries can shed light on the regulatory effects that, if adopted, UNASUR’s enforcement could trigger.

The UNASUR treaty signed in Brasilia, Brazil on 23 May 2008, is a legal instrument integrating the former countries of the Andean Community of Nations (Comunidad Andina de Naciones-CAN), the Southern Common Market (Mercado Común del Sur -MERCOSUR) and Chile, together with Guyana and Suriname.  As an entity with international legal personality, UNASUR aims at prioritizing political dialogue, social policies, education, energy, infrastructure, financing and the environment, with a view to eliminating socio-economic inequality in South America. The bodies of UNASUR as well as its objectives mirror the European Union organization. Indeed, the early negotiations about UNASUR considered  the adoption of the communitarian European model and the enhancement of the existing legislation of the CAN and MERCOSUR. According to Article 26 of the Treaty, UNASUR will enter into force thirty days after the date of receipt of the 9th instrument of ratification. So far, only Venezuela, Ecuador and Bolivia have ratified the Treaty.

South American countries adopting
uneven EHS regulations

Parallel to UNASUR formation, some South American countries have proposed and adopted EHS measures. Countries like Chile, Ecuador and Bolivia, have redefined their institutional structure, and created EHS authorities provided with defined competences and efficient enforcement instruments. Likewise, Colombia, Argentina and Peru have launched systems of EHS compliance monitoring, through the strengthening of environmental sanctions, mandatory insurance policies against environmental damage, registries of EHS infringers, and new systems on public environmental complaints.

The approach of South American states to EHS matters resembles different international, foreign and local tendencies. For instance, Directive 2002/96/EC on waste electrical and electronic equipment (WEEE Directive) has served as a model to proposed regulations on WEEE take-back management plans in Argentina, Peru, Colombia, Venezuela and Uruguay. However, only a few countries have proposed the restriction of the use of certain hazardous substances in electrical and electronic equipment (as in the European Directive 2002/95/EC ‘RoHS Directive’), and some others, like Brazil, have pioneered regulations on maximum heavy metal content for batteries and accumulators.

Concerning international EHS issues, some South American nations have started to harmonize with global tendencies. Notably, Brazil has partially implemented the Globally Harmonized System of Classification and Labeling of Chemicals (GHS), whilst,  sub-regional entities like CAN and MERCOSUR have tried to implement GHS by adopting United Nations recommendations, codes and guidelines on the international transport of dangerous goods. Regarding global warming, South American nations have been individually working on the adoption of legal instruments to tackle climate change challenges, such as frame laws, national policies, new environmental authorities, or new regulations on Clean Development Mechanisms procedures as observed in Colombia, Peru and Ecuador, among others.

Yet, the deep differences on sustainable development among South American countries create a broad gap in EHS regulations in the region. In addition,  issues like the aerial herbicide spraying case between Ecuador and Colombia, the boundaries case confronting Peru and Chile, and the settlement of U.S. military bases in the region appear to hinder the integration process. The lack of political consensus on the implementation  of UNASUR, and the complex policy-making system that resulted, have led to some skepticism on how a communitarian system will be able to embrace and deal with topics deserving immediate action. Despite these obstacles facing UNASUR, the treaty has been already ratified in three States out of twelve.

Once the nine instruments of ratification have been adopted, UNASUR will be in force, making a harmonized and integrated

South American EHS system achievable. Companies operating in any of the 12 UNASUR countries should follow the outcome of this process, as it may lead to region-wide regulatory changes impacting on companies’ operations. An awareness of the EHS measures already adopted in South American countries may help companies deal with the uncertainty that UNASUR’s implementation brings along. The implications of the UNASUR treaty should be considered an important part of a regional approach to EHS matters. Enhesa will be monitoring the progress of the UNASUR treaty and will continue to keep clients informed of the latest EHS developments in South America.

Daniel Rincón

EHS Regulatory Consultant – Latin America

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