Roberta Danelon Leonhardt, Carolina de Almeida Castelo Branco, Bruno Vinciprova Pileggi, Eduardo Perazza de Medeiros, Sergio Ferraz e Opice, and Isabella Guerrero.


State Law No. 23,795/21, published by the government of Minas Gerais (MG), entered into full force to establish important requirements in local legislation on dams, especially by making it mandatory for the state to provide assistance to those affected by dams before, during, and after the installation and maintenance of these structures, including the time of deactivation. The law institutes the State Policy on Persons Affected by Dams (PEAB), to be observed in all actions prior, concomitant with, and subsequent to planning, construction, installation, operation, expansion, maintenance, or even deactivation of dams, whenever their presence may present a risk (albeit potential) of damages to local communities.

According to the PEAB, all those who are harmed, even if only potentially (i.e. indirectly), by the impacts resulting from the dams will be considered affected, namely:

  • loss of property or possession of property or reduction in its market value;
  • loss of productive capacity of the land;
  • loss of fishing area;
  • total loss or partial reduction of sources of income;
  • proven damage to local productive activities or that makes it impossible for commercial establishments to operate;
  • impracticability of access or management activity to natural resources and fishing grounds;
  • compulsory displacement;
  • loss or restriction of access to resources necessary for reproduction of their way of life;
  • breaking of ecosystems;
  • loss or restriction of water supply or capture; and
  • damage to quality of life and health.

Another very important point to be observed by entrepreneurs in the region is the creation of an Economic and Social Recovery Plan (PRDES), called a binding linked plan. Each and every dam installed in MG must be accompanied by a PRDES, for which the preparation, management, execution, and financing of resources for the actions planned will be under the responsibility of the dam's developer. The PRDES will obligatorily cover all the actions foreseen for remediation of the socioeconomic, cultural, or environmental damages caused by dams, as well as the estimated deadlines and costs and the mechanisms for broad social monitoring and follow-up. Such actions and mechanisms are necessary for full repair of socioeconomic impacts arising from the construction, installation, operation, expansion, maintenance, or deactivation of dams.

The law also provides for a series of rights to those affected by dams, such as access to information related to environmental licensing processes and feasibility studies for dams, participation in processes related to repair policies, technical advice funded by the developer, and prior and collective negotiation of forms and parameters for comprehensive repair of socio-economic impacts arising from the construction, installation, operation, expansion, maintenance, or deactivation of dams.

A concrete example, which embodies much of the rights of those affected by dams listed in the law, is the plan to create a representative committee, composed of technicians from the Public Administration and members of the affected community, whose duties include managing the actions provided for in the PEAB and participating in collective negotiations to redress socioeconomic impacts, promoting dialogue between those involved and the developer. In the same sense, as an attempt to ensure greater transparency to enterprises, the law provides that the PRDES shall be prepared in a simple and understandable manner and shall be subject to prior public consultation. Thus, its implementation and results will be monitored and evaluated by the representative committee.

Although the Brazilian PEAB has brought in definitions of the damage experienced by those affected by dams ensuring their right to redress, state law has also brought in open and undetermined concepts, which still need to be regulated by the Executive. An example of this is the pending definition of the scope of action of the independent technical advisor, as well as the rules for the operation and performance of the representative committee.

Finally, another point of attention for developers and entrepreneurs is the mandatory payment of a handling charge, provided for in the tax legislation of the state of Minas Gerais (State Law No. 6,763/75), to the State Bureau for Social Development, in order to fund the activities related to the analysis and monitoring of the PRDES under the PEAB.

In order to ward off new incidents and all the implications that emerge from their consequences, the various immediate and relevant requirements to be met by the state and local developers created by State Law No. 23,795/21 must be closely monitored by all those interested and involved in activities using dams in Minas Gerais, reinforcing preventive action and corporate social and environmental responsibility.