**1. Introduction**

The current context of climate changes imposes severe challenges to the global order, as well as to the necessary reflections in the field of critical theory. Morin and Kern, analyzing the

© 2016 The Author(s). Licensee InTech. This chapter is distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/by/3.0), which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited. © 2018 The Author(s). Licensee IntechOpen. This chapter is distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/by/3.0), which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.

"planetary agony," conceptualize the state of art of the "Earth-Homeland," as well as the "humankind-community of destiny" as a "polycrisis," or the "polycritical collective," all that are set on a context of interlacing crises of development, modernity and societies, therefore, a civilizational crisis [1]. Water shortage is one of the faces of the scenario of world clime, when it makes evident the focal points of the current development policy in Brazil. In this context, the State of Ceará experiences the perverse side of the hydric crisis.<sup>1</sup> It is well-marked by the unfair distribution of water and its intensive destination to large-scaled development enterprises. The Industrial and Port Complex of Pecém2 is an emblematic case of a hydric-intensive and polluting<sup>3</sup> [2] enterprise, which relies on state subventions and public infrastructure to guarantee the feasibility of the enterprise. Such subventions challenge the effectiveness of the Right to Water and the dictates of the National Policy for Hydric Resources. In this research, we aim to investigate how the mechanisms of the unfair distribution of water threat the fundamental Right to Water and reinforce the selectivity of the access to the good. We use the case of the Industrial and Port Complex of Pecém as reference.

**2.** The State Act n. 14.456/2009 ratifies the deal in which the "State commits to make feasible

The Right to Water and Hydric Injustice: A Study on the (Un)Constitutionality of Tax Benefits…

**3.** The State Act n. 15.593/2014, the State of Ceará authorized the concession of ownership to MPX Energia S/A of buildings in the plots of land 720 and 722, destined to the implementation of the Energetic Substation of Pecém II, in the Municipality of São Gonçalo do

**4.** The State Act n. 14.863/2011 authorizes the state to exchange the immobile good denominated Sítio Bom Jesus with the immobile present in the Anexo II, correspondent to a smaller part of the immobile with number registration 4509, of the 2nd Office of Immobile Registration of São Gonçalo do Amarante, of propriety of Rex Empreendimentos Imobilirários

**5.** The State Act n. 16.024 granted tax benefits to the other unity of the Complex, to be build, reducing in 58.8% the basis for calculation of the Tax of Goods Circulation and Provision of Service of Interstate and Intercity Transportation (ICMS, in Portuguese Acronym,) incident on the internal operations and on the importation of natural gas destined to the thermal-electric power plant, resulting in a tax burden equivalent to 7%. It is important to underline that the reduction is destined to internal operations of natural gas being destined to the thermal-electric power plant that is intended to build and operate in the

Such institutes will be analyzed together in the research, but distinctions will be made from the particular legal nature in which they are grouped. This is because some of them constitute the reduction of tariffs, which constitute in the so-called public prices, that is, remuneration for the provision of services, which is charged by private individuals provided with public service, for a profit-making purpose, and there is no tax and binding legal nature. Here are the

The tax exemptions are presented under another legal nature. The tributes express manifestation of the state power, of which the taxes, fees and contributions are species. Its regulation is made constitutionally obeying the principles of the economic order. They constitute compulsory benefits necessarily instituted by law and, when they are charged for the provision of

The other subsidies are not of pecuniary nature, but of real rights, with the concession of land and infrastructure for the enterprise. In this research, the emphasis is on the analysis of the economic institutes that reduce the charging and the taxation, interpreting it in accordance

At first, the central hypothesis of the work is consistent with the vertical and horizontal effectiveness of fundamental rights, to affirm that the protection of the human right to water must be guaranteed in both the tariff instruments and in the tax instruments. There is a complex normative system that governs the right to water, in which the tariff mechanisms break with

of raw water

141

http://dx.doi.org/10.5772/intechopen.75403

the negotiations with CSP to adjust the cost of average tax charged per m3

offered in the moment of initialization of the industrial installations."

Amarante, through extra-judicial agreement of disappropriation.

Ltda.

Complex.

reductions on the cost of water tariffs.

services, they must be specific and divisible.

with the constitutional and legal framework that rules the matter.

For the analysis, we emphasize the study of taxation and charging instruments and their compatibility with the legal system. In this way, the economic legal instruments that subsidize such an enterprise are analyzed under two prisms: the first concerns the balance between constitutionally protected assets and the second about the systematic interpretation of infraconstitutional hierarchy rules.

Conceptual rigor is necessary to distinguish and perceive the legal instruments under analysis. This is because the Industrial Complex of the Port of Pecém receives an articulated set of state subsidies; see:

**1.** The State Act n. 14.920/2011 authorizes the Companhia de Gestão de Recursos Hídricos (Company for Management of Hydric Resources, COGERH, in Portuguese acronym) to grant to the companies Porto do Pecém Geração de Energia S/A (08.976.495/0001–09) and MPX Pecém II Geração de Enerbia S/A (CNPJ 10.471.487/0001–44,) 50% discount on the cost of water tax.

<sup>1</sup> In May 2012, the Government of the State of Ceará declared situation of emergency in 168 of its Municipalities, affected by drought, through the Decree n. 30,922/ 2012, because of the confirmation of the abnormal situation in function of the relevant irregularity in the amount and distribution in time and space of rainfall in the state lands. This subject will be detailed through this analysis.

<sup>2</sup> The Industrial and Port Complex of Pecém (CIPP, in Portuguese acronym) was founded in 1995 and is situated in an area of 32.956,445 acres, 50 km (31 miles) from the state capital city, Fortaleza. The structures of the complex include a port terminal, a retroporto and in it there is an industrial district. Among the operating factories, there is a steel industry and a thermos-electric power plant UTE Pecém (for Usina Termelétrica Energia Pecé, working since 2012. It is coal-fired and its operation supplies electric power for 5 million inhabitants. The power-plant needs an amount of 30,000 m of water to generate 1 Megawatt, the quantity of power required to supply energy to 1000 residences.

<sup>3</sup> For instance, the Brazilian Institute for the Environment and Natural Renewable Resources (IBAMA, in Portuguese) condemned Ceará Portos, the company in charge of the CIPP, to pay 13.8 million Reais for environmental damage. The discard of mineral coal on the Pecém beach was the cause. Several seizures and penalties have already been imposed to CIPP, which is operating without some of the required licenses.

**2.** The State Act n. 14.456/2009 ratifies the deal in which the "State commits to make feasible the negotiations with CSP to adjust the cost of average tax charged per m3 of raw water offered in the moment of initialization of the industrial installations."

"planetary agony," conceptualize the state of art of the "Earth-Homeland," as well as the "humankind-community of destiny" as a "polycrisis," or the "polycritical collective," all that are set on a context of interlacing crises of development, modernity and societies, therefore, a civilizational crisis [1]. Water shortage is one of the faces of the scenario of world clime, when it makes evident the focal points of the current development policy in Brazil. In this context,

unfair distribution of water and its intensive destination to large-scaled development enter-

guarantee the feasibility of the enterprise. Such subventions challenge the effectiveness of the Right to Water and the dictates of the National Policy for Hydric Resources. In this research, we aim to investigate how the mechanisms of the unfair distribution of water threat the fundamental Right to Water and reinforce the selectivity of the access to the good. We use the

For the analysis, we emphasize the study of taxation and charging instruments and their compatibility with the legal system. In this way, the economic legal instruments that subsidize such an enterprise are analyzed under two prisms: the first concerns the balance between constitutionally protected assets and the second about the systematic interpretation of infra-

Conceptual rigor is necessary to distinguish and perceive the legal instruments under analysis. This is because the Industrial Complex of the Port of Pecém receives an articulated set of

**1.** The State Act n. 14.920/2011 authorizes the Companhia de Gestão de Recursos Hídricos (Company for Management of Hydric Resources, COGERH, in Portuguese acronym) to grant to the companies Porto do Pecém Geração de Energia S/A (08.976.495/0001–09) and MPX Pecém II Geração de Enerbia S/A (CNPJ 10.471.487/0001–44,) 50% discount on the

In May 2012, the Government of the State of Ceará declared situation of emergency in 168 of its Municipalities, affected by drought, through the Decree n. 30,922/ 2012, because of the confirmation of the abnormal situation in function of the relevant irregularity in the amount and distribution in time and space of rainfall in the state lands. This subject will be

The Industrial and Port Complex of Pecém (CIPP, in Portuguese acronym) was founded in 1995 and is situated in an area of 32.956,445 acres, 50 km (31 miles) from the state capital city, Fortaleza. The structures of the complex include a port terminal, a retroporto and in it there is an industrial district. Among the operating factories, there is a steel industry and a thermos-electric power plant UTE Pecém (for Usina Termelétrica Energia Pecé, working since 2012. It is coal-fired and its operation supplies electric power for 5 million inhabitants. The power-plant needs an amount of 30,000 m of

For instance, the Brazilian Institute for the Environment and Natural Renewable Resources (IBAMA, in Portuguese) condemned Ceará Portos, the company in charge of the CIPP, to pay 13.8 million Reais for environmental damage. The discard of mineral coal on the Pecém beach was the cause. Several seizures and penalties have already been imposed to

water to generate 1 Megawatt, the quantity of power required to supply energy to 1000 residences.

CIPP, which is operating without some of the required licenses.

[2] enterprise, which relies on state subventions and public infrastructure to

It is well-marked by the

is an emblematic case of a hydric-intensive

the State of Ceará experiences the perverse side of the hydric crisis.<sup>1</sup>

case of the Industrial and Port Complex of Pecém as reference.

prises. The Industrial and Port Complex of Pecém2

and polluting<sup>3</sup>

140 Taxes and Taxation Trends

constitutional hierarchy rules.

state subsidies; see:

cost of water tax.

detailed through this analysis.

1

2

3


Such institutes will be analyzed together in the research, but distinctions will be made from the particular legal nature in which they are grouped. This is because some of them constitute the reduction of tariffs, which constitute in the so-called public prices, that is, remuneration for the provision of services, which is charged by private individuals provided with public service, for a profit-making purpose, and there is no tax and binding legal nature. Here are the reductions on the cost of water tariffs.

The tax exemptions are presented under another legal nature. The tributes express manifestation of the state power, of which the taxes, fees and contributions are species. Its regulation is made constitutionally obeying the principles of the economic order. They constitute compulsory benefits necessarily instituted by law and, when they are charged for the provision of services, they must be specific and divisible.

The other subsidies are not of pecuniary nature, but of real rights, with the concession of land and infrastructure for the enterprise. In this research, the emphasis is on the analysis of the economic institutes that reduce the charging and the taxation, interpreting it in accordance with the constitutional and legal framework that rules the matter.

At first, the central hypothesis of the work is consistent with the vertical and horizontal effectiveness of fundamental rights, to affirm that the protection of the human right to water must be guaranteed in both the tariff instruments and in the tax instruments. There is a complex normative system that governs the right to water, in which the tariff mechanisms break with the protective logic of the environment by favoring the economic model to the detriment of the norms that direct the priorities of water use.

add to this a physical-climate factor-the fact that the lands of the State of Ceará are in the drought-polygon, right in the Northeastern semi-arid. In such region, the evaporation amount exceeds the precipitation one, which aggravates the climate situation: in the analysis made by

A mean annual rainfall of about 900 mm competes with a potential evaporation of 2200 mm powered by 3000 h of sunshine. Real evapotranspiration is of the order of 700 mm (SUDENE 1980; corresponding to 78% of rainfall), leaving only about 120 mm (13%) for runoff and

environmental, climate and hydric spheres, we intend to research, in the following, the Right to Water and the violation to it, what happens because of the development policies adopted

The United Nations broach the Right to Water in many of its documents, some of them centerpiece here: The General Commentary n. 15, from November 2002, from the United Nations Committee for Economic and Social Rights, for instance, affirmed that "the human right to water presupposes that everybody should have sufficient, safe, acceptable and physi-

Resolution 16, from April 2011, from the Council for Human Rights, with the adoption of the access to potable and safe water and sanitation as human rights. However, the major centerpiece is the Resolution A/RES/64/292 [11], passed on July 28, 2010, by the General Assembly

essential human right for the full enjoyment of rights, as well as for all the other rights. For Wolkmer and Melo, the international recognizing of the Right to Water made the international community commit—by the National states—to the protection and tutelage of such right [12]. Nevertheless, in the field conventionally called Latin-American Neo-constitutionalism, particularly in the case of multinational States, such as Bolivia and Ecuador—countries where the Andean indigenous tradition of Well Living is spread, we can find the best deal of the hydric problem (as well as for the other environmental problems), specially from the innovating

The Mother-Earth Act (*"Ley de Derechos de la Madre Tierra")* in Bolivia, for instance, recognizes the rights of Earth as a living system. [13] In Ecuador, similar mechanisms can be found in the Constitution of the Republic itself. [14] For Marques, the recognizing of

Gabriela Riva considers the General Commentary 15 as "the most complete document on the Right to Water, clarifying

In Riva's view, this resolution was "the greatest victory for the access to water movement […] passed by 144 votes in

for all of Brazil (Barth et al. 1987) [9]. In this scenario – a collapse – in the

The Right to Water and Hydric Injustice: A Study on the (Un)Constitutionality of Tax Benefits…

[10], which declares that clean and safe water and sanitation are an

to be com-

143

http://dx.doi.org/10.5772/intechopen.75403

[10] And the

80 mm (9%) for percolation. Specific runoff in the region is of the order of 4 L/s/km2

**3. Water: a common good and a fundamental human right and the** 

cally accessible water with reasonable prices for personal and domestic use."4

Frischkonr, Araújo and Santiago:

by the last governments of the State of Ceará.

**denying of it as hydric unfairness**

concept that Nature is itself a rights holder.

favor, 41 abstentions and no vote in con. […]"

the duties decurrent of such right and defining precisely its bounders."

**3.1. The right to water in the international law**

pared with 21 L/s/km2

of the United Nations<sup>5</sup>

4

5

Thus, we emphasize that the concession of tariff and tax subsidies does not constitute a decision exclusively discretionary of public managers but must primarily be fully compatible with the legal system. Having said that, it is essential to find the legal protection of water in order to analyze the legal economic instruments.
