Water Treatment Evaluation Rules 2010

Introduction

To enhance the performance standards of water treatment facilities in the People's Republic of China (“PRC”), the Ministry of Housing and Urban-Rural Development (????????) (“MOHURD”) promulgated in September 2010 the “Interim Measures on the Evaluation of the Urban Water Treatment” (??????????????) (the “Evaluation Rules”).

The Evaluation Rules implement an evaluation regime where the PRC's water treatment facilities will be assessed on a yearly basis.

The Evaluation

Under the Evaluation Rules, MOHURD will be responsible for evaluating the construction, operation and management of water treatment facilities.

The evaluation will be implemented in three ways:

1. Daily supervision;
2. Ad hoc inspections; and
3. Targeted inspections.

Timing of reports

MOHURD departments in all provinces, autonomous regions and municipalities shall complete and send to MOHURD a self-evaluation report before March of each year. Apart from following MOHURD's guidelines on evaluation, the report should also cover issues such as water treatment planning and execution, the regulation of water treatment and its implementation, water treatment tariffs, water quality testing and major safety issues.

MOHURD shall inspect and assess the progress of all evaluations before May each year.

Scoring

The top score for the evaluation is 100 points and is divided into five parts:

1. Facility coverage rate (?????)
2. Urban-rural wastewater treatment rate (???????)
3. Treatment facilities utilisation rate (????????)
4. Major pollutants reduction rate (?????????)
5. Supervision and management index (??????)

The appendices to the Evaluation Rules set out clearly the number of points allocated to each part and the formulas used in calculating the scores.

For provinces, autonomous regions and municipalities (Appendix 1), the allocation is as follows:

For the 36 medium and large sized cities (Appendix 2), the allocation is as follows:

Results

The results will be classified into one of the following categories:

Those which fall under the “excellent” category will be commended. Those which fall under the “poor” category will be informed and must submit a written report to MOHURD within 30 days, suggesting measures which can be taken for improving the water treatment facilities.

Going forward

The Evaluation Rules will help MOHURD identify in which areas water treatment facilities are below par. Given that evaluation reports will be generated on a yearly basis, the new rules will likely hasten the improvement of water treatment facilities in the PRC. To what extent the Evaluation Rules will be complied with, however, is difficult to foresee as the Evaluation Rules do not spell out, apart from reporting, the consequences (e.g., penalties and/or administrative sanctions) of falling under the “poor” category. Nor are there financial incentives for water treatment facilities to move from the “average” and “good” categories to the top category.

For inquiries related to this Legal Update, please contact:

Jack Su (jack.su@mayerbrown.com)

Xiang Yang Ge (xiangyang.ge@mayerbrown.com)