The Implementation of Environmental Insurance for Transport of Hazardous Materials and Wastes is Suspended for 90 Days

On May 28, 2013 the Official Gazette published the Resolution No. 600/2013 (the “Resolution 600”) issued by the National Secretariat of Environment and Sustainable Development (“SAyDS”) which suspended for a period of 90 business days the application of Section 3 of Resolution No. 177/2013 (the “Resolution 177”), which was issued in February 2013 by the SAyDS.

Resolution 177 – in Article 3 – established the Insurable Minimum Amounts of Sufficient Entity for the activity of transport of materials, substances, goods and hazardous wastes, as provided in Section 22 of Law No. 25,675. This standard provides for the obligation to take out insurance to guarantee financing of remediation of the environmental damage.

At the time of issuing Resolution 177, the SAyDS noted that all transport of hazardous materials, substances, goods and wastes, was required to take out environmental insurance, because these types of transport involved activities which represent a risk to the environment. The SAyDS also considered that the particularities of such transport required a different formula to that corresponding for fixed installations.

Some days after the Resolution 177 was published, on March 25, 2013, the SAyDS asked the Argentine Superintendence of Insurance (“SSN”) to provide information regarding the list of insurance companies that were allowed to underwrite the insurance provided by Resolution 177.

On May 2, 2013, the SSN reported that the only environmental insurance plan approved did not reflect the particularities of the transport activity and concluded that there was no approved insurance plan providing coverage for this activity. Therefore, the existing contractual terms would have to be adjusted or a new coverage that addresses the specifics of the activity would need to be produced.

In response to the SSN’s report, the SAyDS concluded that some additional time was needed for the proper implementation of environmental insurance for the activity of transport of hazardous materials, substances, goods and wastes.