Summary.
The draft bill would bring the National Institute of Aqueducts and Sewers (Instituto de Acueductos y Alcantarillados Nacionales, IDAAN) within the public-private partnership framework solely for drinking water and sanitation infrastructure projects. It would permit studies, design, financing, construction, rehabilitation, expansion, technical operation, and maintenance of drinking water treatment plants, wastewater treatment plants, pumping stations, and related facilities. Public distribution, billing, tariff collection, and customer service would remain with the Institute.
To that end, it amends the scope of Law 93 of September 19, 2019. The exclusion of IDAAN would allow the cases expressly authorized under the proposed Article 3-A. The amended provision continues to cover the Central Government (Gobierno Central), specified public entities, municipalities, and companies in which the State owns at least 51 % of the share capital. It also lists other excluded entities and services, including the Panama Canal Authority (Autoridad del Canal de Panamá), Social Security Fund (Caja de Seguro Social), National Bank of Panama (Banco Nacional de Panamá), Savings Bank (Caja de Ahorros), Agricultural Development Bank (Banco de Desarrollo Agropecuario), National Mortgage Bank (Banco Hipotecario Nacional), Agricultural Insurance Institute (Instituto de Seguro Agropecuario), Securities Market Superintendency (Superintendencia del Mercado de Valores), and Banking Superintendency of Panama (Superintendencia de Bancos de Panamá).
The proposed Article 3-A would allow IDAAN to contract for projects involving drinking water treatment plants; wastewater and sludge treatment plants; and intake systems, conveyance lines, main transmission systems, and pumping stations connected to those plants. Private participation would have to follow the Institute’s master plans, investment programs, and technical needs. The State would retain public ownership of water resources and ownership of public infrastructure and assets under the Political Constitution (Constitución Política), the law, and each contract.
The bill would reserve final distribution, commercial operation of the network, commercial meter reading, user accounts, billing, collection, suspension or reconnection, and complaints to the Institute. A contractor could only operate and maintain authorized infrastructure in a technical capacity. Water produced would be delivered to IDAAN at contractual points and meet the required standards. Tariffs would remain within the powers of the Institute and the relevant regulator; contractor payments would depend on contractual performance indicators. Clauses transferring water resources, commercial control, the network, collection, or tariff-setting powers to a private party would be void.
The Institute’s Board of Directors would have to authorize each proposal through a reasoned resolution supported by technical, economic, financial, legal, environmental, and social studies. Its decision would not replace reviews or controls by the Ministry of Economy and Finance (Ministerio de Economía y Finanzas), Cabinet Council (Consejo de Gabinete), Office of the Comptroller General of the Republic (Contraloría General de la República), or other authorities. The bill adds a Board power to Law 77 of December 28, 2001; its final provision identifies that law as Law 77 of February 27, 2001. It declares the measure a matter of public order and social interest, repeals conflicting provisions, and provides for commencement after promulgation. Its provisions could concern public bodies, water infrastructure contractors, and drinking water and sanitation users.
What it proposes.
- Limited participation by IDAAN in water infrastructure public-private partnerships.
- Technical activities open to contracting and functions reserved to the Institute.
- Project authorization, contract conditions, and public ownership of water resources.
Who it would affect.
- The National Institute of Aqueducts and Sewers and its Board of Directors.
- Private contractors for authorized projects.
- Drinking water and sanitation service users.
Key points.
- Allows the Institute to undertake defined drinking water and sanitation infrastructure projects through public-private partnerships without transferring commercial service functions.Art. 1
- Amends IDAAN’s exclusion from the public-private partnership framework to permit only the cases authorized under the proposed Article 3-A.Art. 2
- Limits projects to drinking water plants, wastewater and sludge treatment, intake, conveyance, pumping, and directly related infrastructure.Art. 3
- Reserves distribution, commercial network operation, user relations, billing, collection, and tariff decisions to the Institute; clauses transferring those functions or ownership of water resources would be void.Art. 3
- Makes contractor payments subject to contractual mechanisms and indicators for availability, quality, capacity, efficiency, and service levels.Art. 3
- Requires a reasoned Board authorization supported by studies and aligned with the Institute’s master plans and investment programs, without replacing other public controls.Art. 4
- Declares the measure a matter of public order and social interest, repeals conflicting provisions, and provides for commencement after promulgation.Arts. 5-6