Regarding The Exception Of Unconstitutionality Of Article 19 Para. (5) Of Law No. 303 13 December 2013 On Service To The Public Water Supply And Sewerage (The Ban On Drilling Of New Water Fountains And Exploiting Existing Ones) (Sesia

Original Language Title: privind excepţia de neconstituţionalitate a articolului 19 alin. (5) din Legea nr. 303 din 13 decembrie 2013 privind serviciul public de alimentare cu apă și de canalizare (interdicția forării de noi fântâni arteziene și exploatarea celor existente) (Sesi

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    On behalf of the Republic of Moldova, the Constitutional Court, acting as part of Mr. Alexandru Tanase, President, Mr. Aurel BĂIEŞU, Mr. Igor DOLEA, Mr. Victor PALMER, Mr. Zadrahimi, judges, with the participation of Mrs. Ludmila Chihai, Registrar, considering the appeal filed on May 3, 2016 and recorded at the same time, examining the appeal referred to in public plenary, taking into account the laws and proceedings, Acting in the Council Chamber following the judgment, a decision: 1. The origin of the case lies the plea of unconstitutionality of article 19 para. (5) of law No. 303 13 December 2013 on service to the public water supply and sewerage system, raised by Carapunarlî, lawyer Alexandru "Proalfa-Service", in file No. 3-463/16 pending in Buiucani, mun. Chişinău.
2. The plea of unconstitutionality has been lodged with the Constitutional Court on 3 may 2016 by judge Abdu Danilov within of the Buiucani, mun. Chişinău, pursuant to article 135 paragraph 1. (1) (a). a) and g) of the Constitution, as interpreted by the decision of the Constitutional Court No. 2 of 9 February 2016, and of the regulation on the procedure for examining complaints lodged with the Constitutional Court.
3. The author of the exceptions claimed in essence that the contested provisions are contrary to articles 9, paragraph 3. (3), Directive 89/391. (2) 46, para. (1) paragraphs 1 and 2 and 126. (1) of the Constitution.
4. By decision of the Constitutional Court of 14 June 2016-constitutionality exception has been declared admissible, without prejudeca Fund case.
5. In the process of examination of constitutionality exception, the Constitutional Court requested the opinion of the Parliament, the President of the Republic of Moldova, the Government and the Ministry of environment.
6. In the plenary session of the Court, the plea of unconstitutionality has been supported by Valeriu Moscalu, Manager of LLC "Proalfa-Service". Parliament was represented by lead counsel, Valeriu Treaty within the Directorate-General of the Secretariat of the Parliament. The Government was represented by Victor Collin, Deputy Minister of the environment.
The MAIN DISPUTE CIRCUMSTANCES 7. On 11 November 2015, Proalfa-Service "" to his "Water-Canal Chisinau", by which it called for the coordination of the operation of artesian fountain owned him. In a letter, to "Water-Canal Chisinau" refused to comply with the request.
8. As a result, "Proalfa-Service" at Buiucani, mun. Chisinau, a third trial against him "Water-Canal Chisinau".
9. At its meeting of April 27, 2016, lawyer Alexandru Carapunarlî, who represents the interests of Ltd "Proalfa-Service", has called for the lifting of the unconstitutionality of the exception. 19 para. (5) of law No. 303 of 13 December 2013 relating to public water supply and sewerage systems.
10. By the same date, the Court has ordered the suspension of the trial and the Court's Constitutional submission with referral for settlement.
PERTINENT LEGISLATION 11. The relevant provisions of the Constitution (republished in the Official Gazette, no. 2016, 78, art. 140) are the following: 9Principiile property fundamentals "(1) the property is public and private. It consists of material and intellectual goods.
(2) no property may be used to the detriment of the rights, freedoms and dignity.
(3) market, free enterprise, fair competition are the basic factors of the economy. "


Article 126Economia "(1) the economy of the Republic of Moldova is a market economy, social orientation, based on private property and public property, engaged in free competition.
[…]. "Article 127Proprietatea" [...]
(4) the riches of any kind of subsoil, airspace, waters and forests used in the public interest, natural resources of economic zones and the continental shelf, the paths of communication, as well as other assets stipulated by the law, are the subject of public property. "
12. The relevant provisions of law No. 303 13 December 2013 on service to the public water supply and sewerage (Official Gazette, no. 2014, 60-65, art. 123) are as follows: Article 1Scopul of the law "the purpose of this law is to create the legal framework for the establishment, organization, management, regulation and monitoring of the functioning of the public service of water supply, sewage, and wastewater treatment plants and industrial (hereinafter public service of water supply and sewerage) in terms of accessibility , availability, reliability, continuity, competitiveness, transparency, respecting the norms of quality, security and environmental protection. "


Article 3Serviciul public water supply and sewerage systems "(1) a public water supply and sewerage system comprises the totality of activities of public interest and general economic and social interest incurred for the purpose of the collection, processing, transportation, storage and distribution of drinking water or the buyers of all technological territory of one or more other localities, as well as for the purpose of collection packaging, transport, treatment and disposal of wastewater.
(2) public water supply and sewerage system shall be established, organized and managed by the local public administration authorities to meet the needs of local communities.
(3) public water supply and sewerage system shall be provided through the creation and exploitation of a specific technical-urban infrastructure, called the system of public water supply and sewerage systems.
(4) In rural areas may organize, where appropriate, only the public water supply. "


Article 13(5) 13Gestiunea "(1) delegated Management constitutes a discharge by local public administration authorities transferred, under a contract, the contract management delegation, of one or more operators all attributions and responsibilities regarding public service provision of water supply and sanitation, as well as the management and operation of systems and technical infrastructure-building projects attached to them.
(2) the entitlement is operator performs delegate management under conditions of transparency through a tender organized in accordance with the legislation in force.
(3) termination of public service management delegation of water supply and sewerage system shall be effected by decision of the local Council or the central body, as appropriate.
(4) the management of delegated shall be carried out by means of operators, which can be: a) companies, municipal enterprises and the State of the public service of water supply and sanitation, set up by local public administration authorities or central body, as appropriate, with registered capital of administrative-territorial units or State;
b) companies for the provision of public service of water supply and sewerage system with private or mixed capital.
(5) the operator who performs delegated management regime provides public water supply and sewerage systems by exploiting and managing technical-urban infrastructure relating thereto, on the basis of contract management delegation approved in the established manner and based on a license issued by the Agency.
(6) the delegation shall be made in the management of contract according to the law.
[…]
(9) the main Criteria for the conclusion of contracts of management delegation are professional and financial guarantees for operators, as well as quality indicators and the level of charges applicable to the provision of the service in terms of quality and quantity.
(10) the newly created Operators can commence the procedure for closing of a delegation of management under the same conditions as the existing ones.
[…]
(13) In case of delegated management, local public administration authorities shall retain, pursuant to powers delegated to them under the law, the powers and responsibilities relating to the adoption of policies and strategies for the development of the service, including the development of systems of water supply and sanitation, as well as the obligation to track, control and supervise the way in which the supply of the service of public water supply and sewerage namely: to respect and fulfil) contractual employees, including in relation to consumers;
b) of quality of service indicators provided;
c) Administration, operation, conservation and maintenance, development or modernization of water supply and sanitation;
d) formation, establishment, modification and adjustment of tariffs for public water supply and sewerage systems.
[…]”.


Article 19Alimentarea with drinking water "(1) drinking water distributed through systems of public water supply system is designed to meet priority needs of the household population, public institutions, economic agents, and, in the absence of technological water, combating and extinguishing.

(2) drinking water distributed to consumers must meet, at their cores e.g. NYY, that pathogenetic germ conditions laid down in the technical regulations and the legal rules in force, as well as the parameters of flow and pressure listed in the technical conditions issued by the controller and the contracts for the supply of this service.
(3) in drawing up the technical conditions for design work, the operators will fit into the general urban plan of the local plan or landscaping. If the locality has no general urban plan updated or local plan updated landscaping, operator, before issuing technical conditions, will approve the decision by local authorities in the development plan of the networks.
(4) upon completion of building works, installations and networks of public water supply and sewerage system, located on public land, constructed of natural persons and/or legal entities, as well as those constructed before the entry into force of this law, regardless of the funding source, shall be sent free of charge to balance local government authority or directly to the operator in accordance with the decision of the local Council.
(5) In localities that have public systems of water supply whose consumers are provided with the full volume of drilling is prohibited new fountains and exploiting existing ones for use of groundwater, except that the operator shall obtain the agreement of coordinated with the local government authority when: (a)) is necessary to create backup sources for water supply to the strategically important objects and for normal operation in emergency situations;    b) water consumer requirements cannot be covered in full by the operator.
[…].”
13. The relevant provisions of the law No. 272 of waters December 23, 2011 (Official Gazette, no. 81, art. 264) are as follows: Article 1Scopul of the law "the purpose of this law is: a) creating a legal framework for management, protection and efficient use of surface waters and groundwater based on assessment, planning and decision making in a participatory way;
(b) establishment of rights of use) of the water and the promotion of investment in the field of water;
[…]
e) ensuring adequate supply with surface water and groundwater with high quality, which is necessary for sustainable, balanced and equitable water;
(f) the establishment of a legal database) for international cooperation in the field of management and protection of shared water resources. "


Article 3Obiectul regulation of the law "(1) this Act regulates: a) management and protection of surface water and groundwater, including measures to prevent and combat flooding, erosion, and measures against drought and desertification;
b) activities that have an impact on surface water and groundwater, including abstraction and use of water, waste water and discharge of pollutants, and other activities that could harm water quality.
(2) the following activities are governed by special laws and: [...] e) ensuring water supply, to discharge sewage and water treatment services to households, Commerce and industry. "


Article 4Regimul of the property in water "(1) water is a renewable natural resource, vulnerable and limited, an indispensable element for life and society, a key factor in maintaining ecological balance, a raw material for productive activities, a source of energy and a way of transport.
(2) water is not a commercial product like any other but, rather, a natural heritage, which must be protected, defended and treated as such.
(3) water is part of the public domain of the State.
(4) any natural or legal person has the right to use water under the present law.
[…].”
LAW 14. The exception of unconstitutionality, the Court observes that it is aimed at essentially the operator agreement, coordinated with the local government authority, to exploit an existing fountain for the use of groundwater, which is owned by a company.
15. Thus, the appeal relates to a set of elements and principles with constitutional value interconexe as well as the principle of fair competition and the exclusive right of the State on public property.
A. ADMISSIBILITY Of 16. By its decision of 14 June 2016, the Court verified the meeting the following conditions for eligibility: (1) subject to the exception comes into the category of acts covered by article 135 paragraph 1. (1) (a). a) of the Constitution. In accordance with paragraph 1 of article 135. (1) (a). the control of the Constitution), on notification constitutionality of laws, in particular of the law nr. 303 13 December 2013 concerning public service of water supply and sanitation is the responsibility of the Constitutional Court.
(2) Exception is raised by one of the parties or its representative, or indicates that it is lifted by the Court ex officio. The exception of unconstitutionality, being raised by a lawyer Alexandru Carapunarlî, who represents the interests of Ltd "Proalfa-Service", in file No. 3-463/16 on the role of the Buiucani, mun. Chişinău, is made by the subject entrusted this right under article 135, paragraph 1. (1) (a). a) and g) of the Constitution, as interpreted by the decision of the Constitutional Court No. 2 of 9 February 2016.
(3) the provisions of the contested to be applied to the settlement of the case. Note that the power of the Court to settle, with the exceptions of unconstitutionality that had been vested in it by article 135 paragraph 1. (1) (a). g) of the Constitution, requires correlation of laws and the Constitution, taking into account the principle of the supremacy of its provisions and to address the relevance of the contested dispute in the courts.
20. the Court observes that the object of the exception of unconstitutionality is article 19 para. (5) of law No. 303 13 December 2013 on service to the public water supply and sewerage systems.
21. the Court supports the author's arguments for constitutionality exception, according to which the contested provisions are to be applied to the settlement of the case, because under their empire were born of legal relations, which continues to produce effects and are determined to resolve the dispute relating to the agreement of the operator for the use of groundwater.
(3) there is a previous judgment of the Court has as its object the contested provisions 22. Keep in mind that the contested court have not been previously subject to constitutionality.
23. Consequently, the Court considers that the non-constitutionality exception cannot be rejected as inadmissible and there is no other reason to interruption of the process, in accordance with the provisions of article 60 of the code of constitutional jurisdiction.
24. In the present case, the subject of the referral regarding the plea of unconstitutionality in relation to Constitutional Court rules note that the reasons invoked by the author of the alleged breach of the exception is aimed at article 9 para. (3) combined with articles 126 para. (1) paragraphs 1 and 2 and 127. (4) of the Constitution. At the same time, keep in mind that the provisions of articles 16, paragraph 2. (2) paragraph 1 and 46. (1), cited by the author of the exception, are irrelevant in relation to the disputed rule.
25. Thus, in order to elucidate the issues dealt with in the Court of constitutionality exception will operate with the provisions of article 9 para. (3) combined with articles 126 para. (1) paragraphs 1 and 2 and 127. (4) of the Constitution (in part related to the observance of fair competition and the exclusive right of the State public property), and the case-law set out in his rationales.
B. the CASE of ALLEGED INFRINGEMENT of the FUND ARTICLE 9 para. (3) COMBINED with ARTICLES 126 para. (1) PARAGRAPHS 1 and 2 and 127. (4) of the CONSTITUTION. The author claims that the non-constitutionality exception article 19 para. (5) of the law on the public service of water supply and sewerage systems in breach of the provisions of article 9 para. (3) of the Constitution, according to which: "[...]
(3) market, free enterprise, fair competition are the basic factors of the economy. "
27. Likewise, the author considers that the exception provisions criticized are contrary to paragraph 1 article 126. (1) of the Constitution, which States: "(1) the economy of the Republic of Moldova is a market economy, social orientation, based on private property and public property, engaged in free competition.
[...].”
28. paragraph 1 of article 127. (4) of the Constitution states: "[...]
(4) the riches of any kind of subsoil, airspace, waters and forests used in the public interest, natural resources of economic zones and the continental shelf, the paths of communication, as well as other assets stipulated by the law, are the subject of public property. "
1. the author of the offline exception Arguments-stituționalitate

29. In exception of unconstitutionality, the motivation of the author's claim that article 19 para. (5) of the law on civil service of water supply and sewerage system violates constitutional principle according to which the market and fair competition are the basic factors of the national economy.
30. At the same time, the author argues that the exception to this rule the legislature established a monopoly over the water supply service. Thus, all the benefits of the public service of water supply is concentrated in the hands of a small group of people who, by their conduct and their actions, impose unilaterally the delivery without offering end users the possibility to choose freely, including provider depending on the tariff. However, the beneficiary of the policy of creating loyal and competitive environment for the protection of competition is the consumer.
31. Furthermore, the author alleges that the contested provisions infringe its right of ownership of the existing artesian fountain, because it is unable to exploit without the consent of the operator to "Water-Canal Chisinau".
2. Arguments of the 32 authorities. The opinion by the President of Moldova, the provisions of paragraphs 1 and 2 of article 19 have been disputed. (5) of the law on civil service of water supply and sanitation do not contravene constitutional rules.
33. In the written opinion, Parliament noted that there is a limitation of the right of ownership in respect of extraction and supply of drinking water, a conclusion based on the fact that water is a renewable natural resource, vulnerable and limited, an indispensable element for life and society.
34. The Government and the Ministry of environment, in their views, said that legal provision subject to criticism of unconstitutionality comes to protect water as a public good, materializând in this manner the constitutional rule enshrined in article 11. 127 para. (4) that the subject waters of public property and under State protection.
3. Assessment of Court 35. The court notice that, according to paragraph 1 of article 127. (4) of the Constitution, any riches of the subsoil, airspace, waters and forests used in the public interest, natural resources of economic zones and the continental shelf, the paths of communication, as well as other assets stipulated by the law, are the subject of public property.
36. Thus, article 4 of Law No. waters 272 of 23 December 2011 States that water is a renewable natural resource, vulnerable and limited, an indispensable element for life and society, a key factor in maintaining the ecological balance. At the same time, water is not a commercial product like any other but, but constitute a natural heritage that must be protected, defended and treated as such. Water is part of the public domain of the State.
37. In this context, the protection, recovery and sustainable development of water resources are actions of general interest. Water is important for life and for all human activities, being used in food, agriculture, industry, services, urban development, transportation, etc. Long regarded as inexhaustible source, however during certain periods and in certain areas the water is not available in sufficient quantity and of appropriate quality. The deficit in line with the increasing pollution of natural waters, polluting industry-generated phenomenon requires a rigorous protection of waters, use their rational, balanced management of all water resources.
38. the Court notes that water is attributed to the category of State natural heritage and is of vital importance to society. In this sense, the objective of protection of maintaining and improving the quality and productivity of their natural, in order to avoid negative effects on the environment, human health and material goods, and regulating the possession and use of natural resources and public property and the competence of the Government is carried out through State body entrusted with management of natural resources and protection of the environment and of the local public administration authorities (see article 9 of law No. 1102-XIII from February 6, 1997 about the natural resources).
39. In order to ensure drinking water needs of natural persons and legal entities, the Parliament adopted the law on public service of water supply and sewerage system, with the aim of creating the legal framework for the establishment, organization, management, regulation and monitoring of the functioning of the public service of water supply, sewage, and wastewater treatment plants and industrial in terms of accessibility , availability, reliability, continuity, competitiveness, transparency, respecting the norms of quality, security and environmental protection.
40. the Court notes that, according to article 8 paragraph 3. (1) (a). b), d) and (g)) of the law on civil service of water supply and sanitation, local public administration authorities of the first level establishes, organizes, coordinates, monitors and controls the operation of the public service of water supply and sanitation, according to the law; administers the public water supply and sanitation as part of technical-urban infrastructure of the respective administrative-territorial units; delegate the administration of the public service of water supply and sewerage system and the corresponding public property under the laws in force.
41. Also in accordance with the provisions of article 13 of the same law, delegated management constitutes a discharge by local public administration authorities shall transfer, on the basis of a contract management delegation, of one or more operators that are companies with private capital or joint or municipal enterprises and the State, all powers and responsibilities to provide the public service of water supply and sewerage as well as the management and operation of systems and technical infrastructure-building projects attached to them.
42. At the same time, the Court observed that the granting of the right of management delegated to the operator shall be conducted under conditions of transparency through a tender organized in accordance with the legislation in force.
43. According to the norm of article 19, paragraph 1, have been disputed. (5) of the law on the public service of water supply and sanitation in localities that have public systems of water supply whose consumers are provided with the full volume of drilling is prohibited new fountains and exploiting existing ones for use of groundwater, except that the operator shall obtain the agreement of coordinated with the local government authority when : a) is necessary to create backup sources for water supply to the strategically important objects and for normal operation in emergency situations;
b) water consumer requirements cannot be covered in full by the operator.
44. the Court notes that article 19 para. (5) of the law on the public service of water supply and sewerage bans drilling of new water fountains and exploitation of existing ones for use of groundwater, except that the operator shall obtain the agreement of coordination with the local public administration authority.
45. the Court note that, in accordance with article 126 of the Constitution, Moldova's economy is market economy, social orientation, based on private property and public property, engaged in free competition. Similarly, according to article 9 paragraph 2. (3) the Supreme Law: "Economic Market, free enterprise, fair competition are the basic factors of the economy."
46. the Court reveals, the competition is a sine qua non of the existence of a market economy, a genuine regulatory force. It can be defined as the confrontation between economic agents with the same or similar activities carried on in the fields of open market. Freedom of competition is a prerequisite for the development of trade relations and a guarantee of progress. In the conduct of trade relations, the competition performs the following functions: guarantee of market economy; to facilitate the free movement of goods and services; stimulating the initiative to participate in the market.
47. Furthermore, the Court notes that the structure of any market economy, in addition to the competition, the monopoly established by State Court note that the State is entitled to establish a monopoly on certain activities or areas.

48. From the point of view of the legal concept of State monopolies can be described as economic activities and state them and carried out, mainly through the State operators. The main purposes of the establishment of the State monopoly are, firstly, to establish a strict control over the activity directly and obtain necessary income of the State budget. The basic requirement against the monopoly of the State is to be established by law. In this regard, State monopolies can be described as economic activities which, by special laws, shall be declared solely in the jurisdiction of the State and can only make the object of activity of the undertakings authorized by it.
49. In its jurisprudence, the Court found that, by virtue of article 22.126 para. (2) (a). c) of the Constitution, State monopolisation of some areas of activity, through which public administration bodies exercising functions related to the production and distribution of certain types of goods or services, is without prejudice to the principles of market economy and free competition.
50. Moreover, in its judgment No. 68 of 7 December 1999, the Court held: "[...] The monopoly of the State is a situation in which a limited number of operators, with the authorization of the public administration bodies have the exclusive right to carry on in a certain sphere of economic activities, production, transportation, marketing and purchasing of goods (services).
The Constitutional Court considers that the monopolisation of the State activities, through which public administration bodies exercising functions related to defense and State security, as well as those that are produced and marketed for certain specific types of goods (services) without prejudice to the principles of market economy and free competition laid down by the Constitution. […]”.
51. In the present case, the Court notes that the legislator has constrained drilling of new water fountains and exploiting existing ones for use of groundwater for existence of the agreement issued by an operator (the operator). The market admission respectively of new entrants is equally dependent on the agreement issued by the operator.
52. Note that the provisions of the contested Court protects an operator, which is contrary to the requirements of antimonopoliste and transparent public service in the field of water supply and sewerage systems. The Court noted that art. 13(2). (10) of the Act on public water supply and sewerage system shall determine that the newly-created operators can commence the procedure for closing of a delegation of management under the same conditions as the existing ones.
53. Therefore, the determination of the condition to obtain the agreement of the operator, coordinated with the local government authority, for drilling of new water fountains and exploiting existing ones for use of groundwater constitutes a breach of the principle of fair competition, since it aims at limiting the right of use of the subsoil.
54. In this respect, article 17 paragraph 2. (1) of the code provides that the subsoil is considered illegal activities of public authorities and the various economic agents, which are aimed at limiting competition, contrary to the conditions of access to participate in the contest of physical and legal persons wishing to obtain the right of use of the subsoil in accordance with the provisions of this code, the avoidance of the use of the entitlement of the winners promptly for the footer contest discrimination of beneficiaries from the sub-soil grant access to transportation and infrastructure targets.
55. the Court points out that, in order to protect groundwater, drilling ban may be imposed by the new fountains, as well as the operation of existing ones. At the same time, the decision to be adopted by State authorities, in the case of local public authority. However, note that a Court operator cannot be the issuing authority in the field of permissive documents the use of natural resources.
56. the Court noted that the authorities of the local public, admission to the market of a new entrant, have the right to consult an existing operator's opinion, so as not to jeopardize the reliability of the centralized systems of water supply and sanitation.
57. At the same time, the criteria which are to be decided on the issue for us drilling agreement fountains and exploiting existing ones for groundwater use must be provided for by law clearly.
58. At the same time, the Court notes that, although the local public administration authorities shall delegate the management of the waters of an operator, however, according to the law, they retain, in accordance with their respective powers, powers and responsibilities relating to the adoption of policies and strategies for the development of the service, including the development of systems of water supply and sanitation, as well as the obligation to pursue , to control and supervise the way in which the supply of the service of public water supply and sewerage systems.
59. In conclusion, the Court note that article 4. 19 para. (5) of the law on the public service of water supply and sewerage system, which imposes the requirement for new operator to obtain the consent of the existing operator for the use of ground water in localities that have public systems of water supply, transgress the principle of respect for fair competition and the exclusive right of the State on public property, so far as being excessive in relation to the objective to be attained and thereby affecting article 9 para. (3) combined with articles 126 para. (1) paragraphs 1 and 2 and 127. (4) of the Constitution.
For these reasons, under articles 135 para. (1) (a). a) and g) and 140 of the Constitution, 26 of the law on the Constitutional Court, 6, 61, 62 lit. a) and e) and 68 of the code of constitutional jurisdiction, the Constitutional Court DECIDES: 1. partially admit the plea of unconstitutionality raised by lawyer Alexandru Carapunarlî in file No. 3-463/16 pending in Buiucani, mun. Chişinău.
2. Declaring unconstitutional the phrase "coordinated with operator" in article 19 para. (5) of law No. 303 13 December 2013 on service to the public water supply and sewerage systems.
3. This decision is final, cannot be subject to any appeal, shall enter into force on the date of its adoption and shall be published in the Official Gazette of the Republic of Moldova.

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