Category: Costa Rica

Recently, the Regulation regarding the marketing in the Union market and the export from the Union of certain raw materials and products associated with deforestation and forest degradation was approved. This regulation would prohibit the entry into the European Union of certain agricultural products that have caused deforestation in their country of origin. Latin American producers are particularly affected by this rule as they must now ensure that their products conform to European market standards. Originators seeking to import or market forest products (wood), bovines, cocoa, coffee, oil palm, rubber, soybeans, or goods derived from these products must: 

Submit a due diligence statement indicating that any analysis showed a high degree of certainty that the product: 

• is free of deforestation under European standards since December 31, 2020, and 
• was produced in accordance with the environmental, labor, human rights, and anti-corruption laws of the country of origin. 

To make this declaration, importers, or traders must: 

a) Obtain information about the product by collecting and filing the following for 5 years: 

• Description of the product and its raw materials. 
• Country and region where it was produced. 
• Geolocation of all plots of land involved in the production of the product. 
• Data of the people who supplied the products. 
• Sufficiently conclusive and verifiable information indicating that the products are free of deforestation and were made in accordance with the legislation of the country of origin. 

b) Evaluate the collected information. Importers or marketers must analyze the information mentioned in the previous section and determine whether there is a risk that the goods have been the product of deforestation or breaches of the country of origin’s regulations. A product may only enter the European Union after it has been determined that there is no risk of non-conformity, or that such risk is negligible. 

 This risk assessment should pay particular attention to circumstances such as: 

• The level of deforestation assigned to the product’s originating country by the European Union. 
• The state of forests in the country of origin. 
• The source and reliability of any deforestation information. 
• Concerns about corruption, document falsification, or lack of law enforcement in the country of origin. 
• The complexity of the supply chain. 

c) Take measures to aim to reduce uncertainty. If there is some risk that a product does not comply with the regulations as a result of the analysis, importers, or marketers can take the following measures to reduce such risk:  

• Request more information. 
• Conduct independent studies or audits. 

Importers and traders must also establish policies and controls to reduce the identified risks, appointing a compliance manager responsible for enforcing this regulation. 

The evaluation duties (section 1) and risk reduction (section 2) will not apply when the interested parties have ensured that the products and their raw materials come from regions classified as low-risk by European authorities. However, those seeking to take advantage of this exception must provide documentation showing a low risk of circumvention, including:  

1. Due Diligence System: Importers or marketers of the products must implement a framework of procedures and measures to guarantee that the imported products comply with the regulations and review such measures at least once a year. 
2. Publication on the Due Diligence System: Every year, importers, or merchants of regulated products must disseminate information on their Due Diligence System as widely as possible, including the Internet. They must also report on the measures taken to ensure that the products they handle comply with the regulations.

 Undoubtedly, this is a revolutionary change with effects that will reverberate loudly inside and outside the European Union: 

1. Within the Union, it entails a series of new requirements for collecting and analyzing information and disclosing it in part to the public. 
2. For Latin American agricultural producers, this regulation strengthens the need for legal compliance practices in crop production and collaboration with European buyers to provide them with information on product compliance. 

Besides posing significant challenges and opportunities for companies, this regulation foreshadows further enactments to support environmental protection and the fight against climate change. It is also crucial to highlight that these initiatives align with the European Union Action Plan for Sustainable Development, published in 2018, indicating the likelihood of seeing additional regulations of this nature in the near future. 

Costa Rica issued Law No. 9876, the Law to Combat Plastic Pollution and Protect the Environment, establishing ambitious goals to reduce plastic waste. However, said Law was suspended pending a Regulation not published until mid-April 2023, and whose main implications we will analyse below:

Scope of Application: Under Articles 1 and 2 of the Regulation, the law applies to importers, producers, marketers, and distributors of plastic straws, bags, and bottles. As a general exception, this regulation does not apply to plastic bottles used to contain inputs for agricultural production.

• Prohibition of straws: Article 4 confirms the prohibition on the commercialization or free delivery of single-use plastic straws.
• However, straws in the packaging of medicines and foods for special diets are exempt from the ban.
• Prohibition of the use of shopping bags: Businesses are prohibited from giving away bags to carry products to their destination.

According to article 5, this prohibition does not apply to garbage, garden or similar bags.

However, straws in the packaging of medicines and foods for special diets are exempt from the ban.

Additionally, bags with a low environmental impact certification and biodegradable or with at least 50% recycled material will be exempt from the law. However, the technical parameters for obtaining a low-environmental impact certification have yet to be defined.

Plastic Bottle Collection Plan: The regulation establishes that anyone who produces, imports or markets plastic bottles or products contained within them must comply with at least one of a series of measures outlined below.

Measures that seek to reduce the use of plastic:

a) That the commercialized plastic bottle consists of recycled resin at a percentage defined by regulation.

b) In the case of producers, produce products or use containers or packaging that, due to their design, manufacturing or use characteristics, minimize waste and facilitate its recovery, or allow its disposal in the least harmful way for health and the environment.

Measures that seek the recovery of plastic waste:

c) Establish a program for the recovery, reuse, recycling, energy use, or other means of valorization of waste derived from the products they market, according to parameters defined in the future regulation.

d) Participate in a program for comprehensive waste management that may be organized by sector or by the waste generated.

e) Establish strategic alliances with at least one municipality to improve collection systems and integrated waste management.

Article 7 of the Regulation establishes a series of rules that clarify the duties of companies that wish to benefit from the group of measures that seek the recovery of plastic waste, namely:

The recovery duties would apply to all persons who in any way commercialize (empty) plastic bottles, and to distributors of products packaged in this type of product.

The obligated companies must design and implement a Compliance Plan that indicates the amount of waste they expect to generate and the recovery goal.

Submit an annual Compliance Report indicating whether the goals were indeed achieved, indicating the type of treatment given to the recovered bottles.

To fulfil these duties, managers authorized by the Ministry of Health may be hired.

Regarding the measures that seek to reduce the use of plastic, the Ministry of Health must publish the technical regulations with the manufacturing parameters of the containers.

Deadline for application: Despite indicating that its application begins four months after its publication, Law 9786 clearly states that plastic straws, bags, and bottles must be regulated 12 months after the law’s publication.

As we can see, this regulation represents a series of duties that affect many companies that must adapt to increasingly demanding regulation of environmental effects. However, society considers the new standards invaluable to promoting sustainable practices and stopping the alarming global plastic pollution.

Water scarcity is a global challenge: one of the countries with the highest water availability per person, Costa Rica, does not escape this challenge and seeks to increase water availability through desalination–converting seawater into drinking water; however, this process requires expensive technologies and approval of a series of permits have limited its adoption in the country. To encourage the use of desalination plants, regulations whose main implications we summarize below have been adopted.

1. Expansion of uses: Under Article 5 of the Desalination Systems Regulation, desalinated water can serve all usages.

• Condominium supply: Article 12 of the Regulation and Article 6 of Decree 35271-S-MINAE clarify that desalinated water may supply condominiums that can request permission to take water from the sea and outside the property’s common areas to conduct it to ensure a reliable water supply.

2. Desalinated-water usage: Article 4 of the Regulation indicates that desalination systems usage will be encouraged: proof of the absence of public drinking water service is unnecessary to obtain a water desalination concession.

3. Passage of pipes in the Maritime Terrestrial Zone: Article 23 of the Regulation allows the passing of conduits through the public area within 50 meters of the sea, as long as the pipelines are underground, permanently protected, and do not obstruct the free transit of the public.

4. Acceleration of procedures: Article 6 of the Desalination Systems Regulation requires various permits; however, the Regulation provides reduced deadlines to obtain them.

• Environmental Viability: Article 11 of the Regulations requires that the processing agency, SETENA, not take more than 35 days to complete the study and issue a decision.
• Approval of construction plans: Like any building project in the country, the relevant Municipality must issue a construction permit before the project proceeds.
• Water usage concession request: Under Article 13 of the Regulation, once the Environmental Viability study is complete, the Water Department has 30 days to approve the concession request, a shorter term than other water concessions.
• Sanitary Operating Permit: This may be the same as for the activity to which you want to provide water, as clarified in Article 7 of the Regulation for the Quality of Drinking Water.
• Permission to lay pipes through beaches: The Municipality (or the ICT in the case of projects located in the Golfo de Papagayo Tourist Pole) must issue such permission.

5. Simultaneous procedures: In addition to the preferential terms for permits (that usually take longer to obtain), Article 7 of the Regulations enables simultaneous approval of all pertinent matters, except for permission for the passage of pipes, which requires approval of Environmental Viability by SETENA and Water Concession by the Water Directorate.

Even though desalination equipment costs remain an obstacle, the new regulations to simplify saltwater purification procedures are a significant step toward increasing potable water availability in the country.

Private environmental conservation initiatives generate undoubted benefits for society, but finding the funds to support them is a common challenge. Even though since the Paris Agreement, the funds available to finance environmental initiatives have been increasing year by year, many financing alternatives are complicated, involve a high degree of bureaucracy, or are just not known to the general public. 

This article seeks to facilitate the process of financing private environmental initiatives in Latin America by providing a list of available alternatives to which project leaders can apply directly:   

• Global Environment Facility Small Grants Program:  

• It is ideal for grants of up to $50,000.  
• Open for applications from any non-profit organization worldwide.  
• Depending on the country, applicants may require making an investment in the same proportion to the amount to be donated.  
• Cannot be used to fund salary payments, land or vehicle purchases. 
• Requirements: The list of requirements for Costa Rica can be consulted on this page. For other countries, you can access the following portal and select the country of interest. 

• United States Agency for International Development (USAID) Grants: 

Any individual or private entity can contact USAID to submit their contract proposal or grant application. USAID funds a wide variety of projects with diverse purposes and budgets, as long as they are aligned with promoting development in countries that require it. For more information, please see the following link or the contract and grant instructions. 

• Tropical Forest Fund: This alternative focuses on financing projects to create new protected areas in tropical and subtropical ecosystems. The application process is quite simple, as can be seen here. 
• International Climate Initiative of the German Government (IKI): Funds a range of projects related to climate change mitigation and adaptation, including biodiversity conservation projects. 

• In the following link, you will find all the funding possibilities currently open, together with an explanation of the requirements for application. 

• French Fund for the Global Environment: Open to any type of legal entity, this fund grants contributions ranging from 500,000 to 3,000,000 euros. 

• General application requirements can be consulted here.  
• Operates under co-financing, which requires that at least 70% of the total project funds be contributed by the applicant or another funding institution.  
• The execution of the financed project may not exceed five years. 

This list focuses on financing alternatives that are constantly open to new applications directly from private entities. However, there are many other occasional alternatives that are accessible through intermediary institutions such as development banks or governments. To get an idea of other available options, you can review the directory of Funding Organizations managed by the Ramsar Convention Organization.  

There is no doubt that environmentally positive projects today have more funding possibilities than ever before; however, funding programs are challenged to disseminate and simplify the application processes to achieve a truly inclusive funding process.