Photo: Argentinean officials announce the new regulation (credit: National Environmental Office).
Thanks to a set of regulations and norms established by the Argentinean Environmental Secretariat, companies that carry on hazardous activities will have to get insurance against environmental damage in the country.
According to the office, the law that establishes this was actually approved a while ago, but companies didn't comply with it because -ironically- there weren't regulations to define which activities were considered dangerous and there wasn't any insurance policy they could hire. Therefore, during the last year the office defined the hazardous activities, established a criteria for policies amounts, and created a division to follow the subject on environmental insurance, to announce last week that the law is coming into force.
Authorities say Argentina is the first country in the world to have this legislation and claim that at least 35,000 companies will fall under this new rule.
More in the extended."There's a lot of environmental insurance sold in Europe, but it's not obligatory because it doesn't have to be. In Argentina, lawmakers understood that this had to be made obligatory," Sergio Chodos, an undersecretary at the Environment Secretariat, told Reuters news agency.
According to official estimations, the policies companies will have to deal with go from 120,000 pesos (36,090 USD) to 50 million pesos (15 million USD) a year, depending on the business activity and potential risk. Some of the target companies are food, petrol and mining industries.
So far only one insurance company is authorized to sell this type of coverage in the country, but according to the government there are others applying. La Nacion newspaper estimates this rule will be a 60 to 70 million USD a year business.
The focus of the measure is a big step for Argentina, which has allowed some very ugly environmental mess out of lack of regulations. However, skeptical citizens have seen too many announcements claiming companies will pay for their mess and too little actual cases of them doing so. Let's hope different this time.
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