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Water Management Act Gmo hr

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Water Management Act Gmo hr Powered By Docstoc
					                         I. FUNDAMENTAL PROVISIONS

Article 1.

This Act regulates the legal status of water and water estate, the methods and
conditions of water management (water use, water protection, regulation of
watercourses and other water bodies, and protection from adverse effects of water),
the method of organizing and performing water management tasks and functions,
basic conditions for carrying out of water management activities; powers and duties of
Government administration and other Government bodies, local authorities and other
legal subjects, and other issues of importance to water management.

This Act also establishes Croatian Waters (Croatian Waters) - the legal entity in
charge of water management tasks (hereinafter referred to as: Croatian Waters).

The funds for financing water management tasks shall be provided in accordance with
a separate act.

Article 2.

The provisions of this Act shall apply to:

- surface and ground terrestrial waters, including the mouths of rivers and canals
discharging into the sea, to the demarcation line as defined in Article 4, Item 6 hereof,

- mineral and thermal waters, except mineral and geothermal waters suitable for
extraction of mineral raw material or utilization of accumulated thermal energy for
power purposes, which is regulated by the Act on Mining, drinking water sources in
the territorial sea,

- sea water, as regards protection against pollution from mainland and island-based
sources.

The Director of the State Water Directorate (hereinafter referred to as: the Director)
and the Minister of the Ministry in charge of maritime affairs shall jointly define the
demarcation line between terrestrial water and sea water referred to in para 1, subpara
1 of this article, in connection with Article 4, Item 6 hereof.

Article 3.

Vode su opće dobro koje zbog svojih prirodnih svojstava ne mogu biti ni u čijem
vlasništvu.

Vode kao opće dobro imaju osobitu zaštitu Republike Hrvatske.

Za korištenje i stjecanje prava na vodama, pored odredaba ovoga Zakona, moraju biti
ispunjeni i uvjeti određeni posebnim zakonima (zaštita prirode, plovidba, ribarstvo,
zdravstvo i dr.).

Article 4.
Water is a public resource which, because of its natural properties, cannot be
anybody's property.

Water as the public resource enjoys special protection of the Republic of Croatia.

For the use and achieving the right on water the precondition is meeting of
requirements defined by separate acts (environment protection, navigation, fishery,
public health etc.).

Article 4 For the purposes of this Act, certain expressions shall have the following
meaning:

1. the water regime implies the spatial layout and development of the water system,
and the status of water quantity and quality in a given area and at a given time,

2. the water system consists of all watercourses and other water bodies, water estates
and water works in a given area (area of the Republic of Croatia, water basin, or
catchment area).

3. the channel is a depression in the terrain through which water runs permanently or
sporadically, or in which water is contained,

4. the bank is the land zone along the channel of running or other terrestrial water,
which is used for access to water and regular maintenance of the channel,

5. the watercourse consists of the running water channel, together with the banks and
the water constantly or sporadically running through it,

6. the mouth of a river or canal discharging into the sea consists of the watercourse
channel with banks to the demarcation line which connects the farthest points of the
banks at the contact with the sea,

7. interstate waters are water bodies constituting or intersecting the state border.

                             II. WATER MANAGEMENT

Article 5.

Water management consists of a group of activities, decisions and measures meant for
the purpose of maintenance, improvement and establishment of the integrity of the
water regime in a given area, which is achieved in particular by providing the required
quantities of water of adequate quality for various purposes, by protection of water
against pollution, regulation of watercourses and other water bodies, and by
protection from adverse effects of water.

Article 6.

Water management is based on the following principles:
1. Water is an irreplaceable precondition for life and activity. It is the duty of all
persons to protect carefully its quality, and use it sparingly and rationally under equal
conditions determined by the law;

2. Water shall be managed in accordance with the principle of integrity of the water
system and the principle of sustainable development which meets the needs of the
present generation without threatening the right and possibilities of future generation
to meet their needs;

3. The territorial water management units are the water basins and catchment areas as
hydrographic and economic units. The borders of administrative -territorial units shall
not present obstacles to integrated water management in such areas;

4. In preparing and adopting plans which are the basis of water management, the
starting point is the obligation of integrated environmental protection and the
achievement of general and economic development of the Republic of Croatia;

5. For water use exceeding the limits of permissible general use, as well as for any
deterioration of water quality, a compensation shall be paid in proportion to the
benefit gained, or to the degree and extent of the impact on water quality;

6. The regulations defining the tasks and duties for investments in improvement of the
water system shall also define the sources of financing.

Article 7.

The water regime is determined on the basis of long term observation of spatial
distribution of water quantity, quality and other properties, and the development of the
water system.

Changes of the water regime refer to all changes due to human activity and behaviour,
or to the acting of natural forces causing changes in water quantity or quality, and its
distribution in space and time.


1. WATER WORKS

Article 8.

The water works are civil works, or groups of such works, together with the
corresponding equipment, consisting technical ortechnological units, and serving for
regulation of watercourses and other water bodies, protection from adverse effects of
water, water extraction for various purposes, and for water protection.

Article 9.

The water works, with respect to their purpose, are, as follows:

1. Regulation and protective works - dikes, bank revetments, artificial watercourse
channels, relief canals, lateral canals for protection from external water, drainage
tunnels, dams with reservoirs, sluices, flood storages and other corresponding
facilities, pumping stations for flood protection, erosion and torrent control works,
and other pertaining works;

2. Water works for amelioration drainage - basic and detailed canal (amelioration)
network, pumping stations for amelioration drainage, subsoil drainage and other
pertaining works;

3. Water works for water use:

(a) for water supply - water intakes (wells, cappings, intakes on watercourses, lakes,
reservoirs, pumps, etc.), drinking water treatment plants, water storage tanks and
major pipelines;

(b) for ameliorative irrigation - storages and other intake works, distribution network
and other pertaining works;

(c) for power production - storages, inlet and outlet canals, and other pertaining
works;

(d) for navigation - waterways, shiplocks, gates and other pertaining works;

(e) water works for water protection - collectors, waste water treatment plants, outlets
into receiving water, and other pertaining works.

Construction of water works referred to in para 1, items 2,3 and 4 of this Article,
which is financed from the budget or other funds provided in accordance with the law
or bye-laws, is in the interest of the Republic of Croatia.

For the purpose of construction of works referred to in paras 2 and 3 of this Article,
the expropriation proposal may be submitted directly in accordance with the
provisions of the Act on Expropriation.

Article 10.

Regulation and protective water works are the interest and the property of the
Republic of Croatia.

Water works under para 1 of this Article shall be managed by Croatian Waters, which
shall be in charge of their keeping, regular technical and economic maintenance and
proper use.

An exception from para 1 of this Article shall be the regulation and protective works
constructed on the property of a certain legal or physical person, and financed by such
person, in order to serve for agricultural or other permissible purposes, or protection
of the person's property; such works shall be the person's property.

Article 11.
Water works serving for amelioration irrigation or amelioration drainage, construction
of which is financed from the budget or from specific compensations paid, in
accordance with the law, by water users in a catchment area, are in the interest of the
Republic of Croatia and shall be the property of the County in which they are situated.

The provisions of para 1 of this Article shall apply also to water works for
amelioration drainage and amelioration irrigation constructed before entering into
force of this Act.

Water works referred to in para 1 and 2 of this Article shall be managed by Croatian
Waters.

An exception from para 1 of this Article shall be the amelioration drainage and
irrigation works the construction of which is financed by the land owner, and which
serve the purposes of the land; such works shall be the property of such person.

Article 12.

Construction of regulation and protective water works, technical and economic
maintenance of watercourses, water estate and water works shall be carried out in
accordance with the water management plan.

The national water management plan (Article 17, para 1) is enacted by Croatian
Waters in agreement with the Director.

Local water management plans for separate catchment areas are enacted by Croatian
Waters in agreement with the assemblies of the counties concerned, and in case of the
catchment area of the City of Zagreb, in agreement with the Assembly of the City of
Zagreb (hereinafter: the County Assembly).

Article 13.

Technical and economic maintenance, bearing of a part of costs of maintenance and
coordination of use of multipurpose storages and other water works which, along with
protection from adverse effects of water are also used for other purposes (power
production, irrigation, recreation, etc.) shall be implemented in accordance with the
contract concluded by Croatian Waters and other parties exercising their rights on
such works, in agreement with the State Water Directorate.


2. TERRITORIAL GROUNDS OF WATER MANAGEMENT

Article 14.

The territory of the Republic of Croatia is, for water management purposes, divided
into water basins and catchment areas.

Article 15.
The water basin comprises one or more catchment areas of major river watercourses,
or parts thereof, constituting a natural hydrographic entity.

The water basins are:

1. Water basin of the Sava river catchment area

2. Water basin of the Drava and Danube catchment areas

3. Water basin of the Littoral and Istrian catchment areas

4. Water basin of the Dalmatian catchment areas

The borders of the water basins are defined by the Government of the Republic of
Croatia.

Article 16.

The catchment area comprises, within a water basin, one or more catchments of minor
watercourses for which integrated water management is provided, with respect to
interconnected problems, existing water system and economic conditions.

The catchment area constitutes a territorial unit for water management purposes. The
catchment areas are determined by the Government of the Republic of Croatia.

Article 17.

Surface waters are divided into waters of importance to the Republic of Croatia
(hereinafter: state waters) and local waters.

The list of national waters is determined by the Government of the Republic of
Croatia.

Other surface waters, except those referred to in para 2 of this article, shall be
considered local waters.


3. PLANNING BASIS FOR WATER MANAGEMENT

Article 18.

The planning basis for water management is the Water Management Master Plan of
Croatia and the water management plans and schemes of the catchment areas.

Article 19.

The Water Management Master Plan of Croatia is a long-term planning document
defining the base of water management, water balance and improvement of the water
system, ensuring an integrated and coordinated water regime in the Republic of
Croatia and in each water basin (hereinafter: integrated water regime).
The Water Management Master Plan of Croatia determines, in particular: distribution,
supply and properties of water, water requirements in all segments of life, work and
other activities, and the method of providing sufficient water quantity of water
adequate for such purposes; provides for water protection from pollution, determines
optimum technical and other solutions for watercourse regulation, protection from
floods and other adverse effects of water, and other solutions of importance to water
management and ensuring an integrated water regime.

The Water Management Master Plan of Croatia must be based on scientific research,
continuous observation of the situation and phenomena in connection with water and
its use, respecting of specific water problems in each water basin and integrated
environmental protection.

The Water Management Master Plan of Croatia, Strategy of Physical Development,
Strategy of Environmental Protection, forest management plans at the national level
and the plans of development of inland navigation system, shall be mutually adjusted.

Article 20.

The Water Management Master Plan of Croatia must be adjusted to changes occurring
in the water system, economic and social development.

The Water Management Plan of Croatia is enacted by the Parliament of the Republic
of Croatia.

Article 21.

The basic planning document for water management and improvement of the water
system in the catchment area is the water management plan or water management
scheme of the catchment area.

Water management plan of the catchment area is enacted for areas with complex
problems of water use, water protection, regulation of watercourses and other water
bodies, and protection from water. As regards the contents of the catchment area
water management plan, the provision of Article 19, para 2 hereof shall apply.

For other catchment areas, except those referred to in para 2 of this Article, water
management schemes are enacted.

The water management plan of the catchment area determines: distribution, supply
and properties of water, water requirements, corresponding technical and economic
relations, water management activities and activities for improvement of water
conditions in the catchment area.

Water management plans and schemes of catchment areas shall be in compliance with
the Water Management Master Plan of Croatia.

Water management plans and schemes of catchment areas, environment protection
plans, physical development programs and forest management plans in catchment
areas, shall be mutually adjusted.
Article 22.

Water management plans and schemes of catchment areas must be adjusted to
changes in the water system, economic and other development in the catchment areas.

The planning document referred to in para 1 of this Article is enacted by the County
Assembly upon proposal by Croatian Waters, with the consent of the State Water
Directorate regarding the compliance of this document with the Water Management
Master Plan of Croatia. In case the catchment area concerned stretches over the
territories of two or more Counties, this document shall be enacted jointly by the
Assemblies of the Counties concerned.

Should the County Assembly referred to in the previous para fail to enact the water
management plan or scheme within three months from receipt of the draft from
Croatian Waters, these documents shall be enacted by the Government.

Article 23.

Detailed regulations regarding the content, method and the procedure of enacting of
the Water Management Master Plan of Croatia and of the catchment area water
management plans and schemes shall be issued by the Director.


4. WATER USE

Article 24.

Under this Act, water use shall mean:

- intake, pumping and use of surface and ground water for various purposes (water
supply for drinking, sanitary and technological purposes, irrigation,
etc.),

- use of water power for production of electric energy and other similar purposes,

- use of water for fish-farming,

- use of water for navigation,

- use of water for sports, bathing, recreation and other similar purposes.

Article 25.

Everybody shall be allowed to use water, under the conditions and within the limits
determined by this Act.

Water shall be used rationally and economically. Every water user shall use water in
the way and to the extent ensuring that water is not wasted, nor its properties (quality)
are deteriorated, and that the right of other persons to use water is not denied.
Article 26.

Everybody shall be allowed, in accordance with the regulations, to use water in the
ordinary way that does not require specific devices and does not exclude others from
the same use (general water use).

General water use includes in particular:

1. Water intake, without special devices, from watercourses and other natural sources,
for drinking, sanitary and other personal household purposes;

2. the use of water in rivers, lakes and other surface water bodies, for bathing and
recreation.

Personal household purposes referred to in para 2, item 1 of this Article include water
use for drinking, hygienic and similar household purposes. This shall not include the
use of water for irrigation, and water use in technological processes in industrial
activities.

Article 27.

For any water use exceeding the limits of general use a water rights permit shall be
required, except when specified by this Act, or other regulations in accordance with
this Act, that water may be used without a water rights permit.

The town or municipal council, or the Assembly of the City of Zagreb (hereinafter:
town or municipal council) may, after obtaining the comments of Croatian Waters,
issue more detailed regulations regarding the location, way and extent of general
water use, granting equal rights and equal water use for everybody, and provided
general water use does not impede other special purposes of water as determined by
this Act.

Article 28.

The land owner, or person exercising other right on land may, without a water rights
permit use freely:

1. rainwater collecting on his land

2. water from springs on his land which does not form a watercourse within the land
limits (does not run beyond the land limits)

3. ground water on his land, used within the limits of personal household
requirements (from wells, pumps, etc.).

Article 29.

Water use may be temporarily limited or permanently closed:
1. in case of temporary shortage of water to the extent that makes it impossible to
meet the needs of all water users in a given area;

2. if it is found out that ground water or other water resources, from which water is
drawn for public water supply, have been exhausted to the extent that makes further
pumping impossible, or there is the risk of their complete exhaustion;

3. if water quality is deteriorated due to the extent of drawing, or if such deterioration
is likely;

4. if the forest ecosystem is threatened by lowering of the ground water table.
The decision on temporary limitation or permanent closing of water use in cases
referred to in para 1 of this Article may be made by the county administration, or the
administration of the City of Zagreb (hereinafter: County administration); in case the
limitation or prohibition concerns the territories of two or more counties, such
decision is made by the Director.

Article 30.

Should any legal entity or physical person, carrying out mining works, tunnel
excavation, other excavation and soil drilling, find ground water (spring, running or
stationary water), such person or entity shall immediately, and not later than 48 hours
from finding, notify the water inspector or Croatian Waters, or the closest police
station which shall, in turn, immediately notify Croatian Waters.

The legal entity or physical person referred to in para 1 of this Article shall grant
water inspector and the authorized person of Croatian Waters access to the data and
permission to carry out the necessary investigation in order to determine the location,
quantity and quality of ground water, and take the necessary safety measures as
ordered by the authorized person.

Article 31.

The town or municipality, on whose territory a storage reservoir or flood storage, is
situated, from which legal entities and physical persons on the territory of another
town or municipality draw material benefit, shall be entitled to a rent (compensation).

The rent referred to in para 1 of this Article shall be paid by the town or municipality
on whose territory the benefit from the reservoir or flood storage is materialized. The
annual amount of rent shall be agreed by towns or municipalities referred to in para 1
of this Article, at the level of the lost income tax and land tax for the land covered by
such reservoir or flood storage. The amount of compensation shall be determined on
the basis of land registry data on the area, crops and land quality before construction
of the said reservoir or flood storage. In case the land registry does not have such data,
the amount of compensation shall be determined on the basis of comparison with
corresponding land in the vicinity of the reservoir or flood storage.

In case the agreement referred to in para 2 of this Article is not reached, the level of
compensation shall be determined by the arbitration committee nominated by the
Government of the Republic of Croatia upon proposal by the Director.
The town or municipality that has to pay the rent in accordance with the provision of
this Article, shall have the right to allocate and collect the determined amount of rent
by introducing the specific compensation to be paid by legal entities and physical
persons directly benefiting from the reservoir or flood storage.

The provisions of paras 1 and 2 of this Article shall not apply to storage reservoirs
used primarily for production of electric power.
The Government of the Republic of Croatia shall issue more detailed regulations on
determining of the rent amount and terms of payment, the procedure and method of
introducing the specific compensation, the basis for determining individual payment
of the specific compensation, and the method of collection.

a) Vodoopskrba

Article 32.

The use of water for the supply of population with drinking water, sanitary purposes,
fire protection and defense shall enjoy absolute priority over water use for other
purposes.

Depending on specific needs and conditions in separate catchment areas, the order of
priority of water use may be determined, assigning top priority to purposes referred to
in para 1 of this Article. Decision to this effect shall be made by the County assembly,
with the consent of the State Water Directorate.

If the catchment area is situated on the territory of several counties, the decision
referred to in para 2 of this Article shall be reached by agreement between the
assemblies of the counties concerned, and if they fail to reach the agreement, the
decision shall be made by the Government of the Republic of Croatia.

Article 33.

The town or municipality shall have the priority right to use water from springs or
other sources situated on its territory for the purposes referred to in Article 32 hereof,
to the extent which corresponds to the needs of the area in the period of five years
from the date of placing of the requirement for water use for the same purposes by
another local authority.

In case the agreement on water use rights referred to in para 1 of this Article is not
reached, the decision on the requirement of another local authority shall be made by
the State Water Authority.

Article 34.

The water supply activity, for the purpose of this Act, consists of intake and pumping
of ground and surface water for drinking and other purposes, treatment of water to the
level of health standard, transport to the place of consumption, and distribution to
consumers.
Water supply activity is carried out by legal entities organized in accordance with the
law regulating municipal activities.

The water supply system consists of the set of plants and devices necessary for
carrying out of the activities referred to in para 1 of this Article.

Article 35.

Legal entities carrying out water supply activity shall ensure constant and systematic
supervision of water and take measures to ensure the health standard of drinking
water, as well as of proper technical condition of the plant, and submit the data to the
relevant water and sanitary inspection.

The extent and method of inspection of drinking water and plants referred to in para 1
of this Article shall be prescribed by the Minister of Public Health.

Article 36.

The use of water from springs and underground aquifers, except water referred to in
Article 28 hereof may be approved only after conducting of water research works.

Water research works are the works and investigations carried out for the purpose of
determining the existence, extent, quantity, quality and mobility of ground water in a
given area.

Article 37.

The decree of the town or municipal council regulates the following:

1. the manner of maintenance of the facilities and provision of adequate water
quantity and quality, and conditions of use of public wells, public pumps and other
similar facilities which are not included in the system of organized municipal services
in accordance with the Municipal Services Act.

2. conditions for provision of adequate water quality and water use pursuant to Article
28 hereof.

Article 38.

The quality of water for water supply shall be in compliance with the conditions
defined by water classification (Article 71) and other conditions prescribed by the law
or bye-laws.

Article 39.

Legal entities and physical persons extracting or pumping water, except water
pursuant to Article 28 hereof, shall keep the record of water quantities and submit the
data thereon to Croatian Waters.
The regulations regarding the contents and the record keeping pursuant to para 1 of
this Article shall be issued by the Director.

Article 40.

The area surrounding the wellfield or other source of water used or reserved for public
water supply, as well as the area where water is taken for the same purpose from
rivers, lakes, reservoirs, etc. (hereinafter: sources) shall be protected from deliberate
or accidental pollution and from other influences that may adversely affect the
sanitary quality of water, or its yield (sanitary protection zones).

The protection pursuant to para 1 of this Article shall be implemented in compliance
with the decision on source protection defining, on the basis of previous water
research works, the size and the limits of the sanitary protection zones, sanitary and
other conditions of maintenance, and other protective measures, sources and manner
of their financing, and penalties for violation of provision thereof.

Article 41.

The decision on protection 'of the source with the limits of sanitary protection zone
spreading over the territory of one town or municipality shall be issued by the town or
municipal council concerned.

The decision on protection of the source with the limits of sanitary protection zone
spreading over the territories of two or more towns or municipalities in the same
county shall be issued by the county assembly.

The decision on protection of the source with the sanitary protection zone situated on
the territories of two or more counties shall be made by agreement between the
assemblies of the counties concerned. In case the agreement is not reached, the
decision shall be made by the Director.

For the decision on source protection, the necessary precondition is the comment by
Croatian Waters.

The sanitary protection zones defined by the decision on source protection, as well as
the areas reserved for sanitary protection zones for which no decision has been made,
shall be included in the document on physical development of the area where such
zones are situated.

Article 42.

When protection of the sources, in sanitary protection zones, requires special enlarged
investments in the water supply system and the public sewerage system, the funds for
such investments are provided for in the budget of the towns and municipalities on
whose territory water from such source is used, in proportion to the quantity of water
delivered to each local administrative unit.

Towns or municipalities referred to in para 1 of this Article shall have the right, in
order to cover the costs of the above investments, introduce particular compensation,
which shall be paid through the price of water delivered to the end users. Such
compensation may be introduced for a limited period of time as required to cover the
actual investment costs.

Article 43.

More detailed regulations regarding the conditions and manner of determining of the
sanitary protection zones, and criteria for determining of special compensation
pursuant to Article 42 hereof, shall be issued by the Director.

b) Water use for ameliorative irrigation

Article 44.

Taking and use of water from watercourses and other surface water bodies, pumping
of ground water and collecting of rain water for irrigation of agricultural and other
land (ameliorative irrigation) shall be carried out in the manner and under the
conditions defined by the water rights permit and by the concession contract when so
determined by this Act.

Water users referred to in para 1 of this Article shall bear the maintenance costs of the
ameliorative irrigation system.

The provision of para 1 of this Article shall not apply to water referred to in Article 28
hereof.

Article 45.

For the purpose of construction and use of ameliorative irrigation systems of interest
to several land owners or land users, co-operation may be established.

For entering of the co-operative activity into the court register, the conditions
pursuant to Article 174 hereof shall be fulfilled first.

Professional supervision over water use for ameliorative irrigation through the co-
operative shall be carried out by Croatian Waters.

Article 46.

The land owner may construct the ameliorative irrigation system for irrigation of his
own land by himself.

Article 47.

For the purpose of bringing water to the ameliorative irrigation system, the rights of
way may be established.

Should the interested parties fairto reach agreement on the right of way, the decision
on the right of way shall be made by the county office, or the office of the City of
Zagreb in charge of the property-rights relations.
In establishing the rights of way, the corresponding provisions of the Act on
Expropriation regarding the procedure and compensation for partial expropriation
shall apply.

Article 48.

Detailed regulations regarding technical, economic and other conditions for
ameliorative irrigation systems, technical control of the system, responsibility for
reporting of the condition and use of the system basic criteria for determining of
maintenance costs and their allocation to users shall be issued by the Director.

c) Use of water power

Article 49.

The right of use of water power for production of electric energy and for devices
driven by water power may be awarded on the basis of concession contract and the
water rights permit.

The basic principle in making the decision on awarding of the right to use water
power is the principle of greater public interest (improvement of the general standard
of living, environmental protection, health protection, etc.), and rational use of water
power.

The right of using water power is awarded for a limited period of time.

Article 50.

The unit of measure of water quantity pursuant to Article 49, para 1 hereof shall be
one cubic meter (cu.m.).

The unit of measure of the driving force of water pursuant to Article 49, para 1 hereof
shall be one kilowatt (kW).

Article 51.

Water works and devices for the use of water power shall be designed and constructed
to comply with the following requirements:

- they shall allow returning of water into watercourse or other water body;

- they shall not reduce the existing extent of water use for water supply, irrigation and
other purposes, and they shall not obstruct water use for other purposes defined by
plans in accordance with this Act;

- they shall not reduce the level of protection from adverse effects of water, nor
impede implementation of such protection measures;

- they shall not deteriorate the health conditions nor affect adversely the condition of
the environment;
- they shall not cause damage to forests and other flora and fauna, nor to property and
legal interests of other persons;

- they shall not impede pedestrian, road and railway traffic, nor inland navigation.

Article 52.

In construction of storage reservoirs for the purpose of the use of water power, it is
imperative to ensure their multipurpose character, in particular regarding protection
from floods and other adverse effects of water and provision of water for water
supply, irrigation and other purposes.

The multipurpose use of storage reservoirs pursuant to para 1 of this Article is ensured
in compliance with the concession contract, water rights terms conditions and location
permit.

The contract concluded by investors in construction pursuant to para 1 of this Article
determines the responsibility of bearing a corresponding portion of construction costs
and participation in technical and economic maintenance of the reservoir and its
environment after completion of construction.


5. EXTRACTION OF MINERAL RAW MATERIAL IN AREAS OF
IMPORTANCE TO
THE WATER REGIME

Article 53.

Sand and gravel in renewable deposits in areas of importance to the water regime may
be excavated only on the basis of the water rights permit and of the concession
contract when so determined by this Act.

The areas of importance to the water regime pursuant to para 1 of this article are:

- watercourses and other surface water bodies, regulated and non-regulated inundation
zones (Article 85, paras 2 and 3),

- the sea zone along the mouths of rivers and canals discharging into the sea, in the
diameter of one sea mile from the centre of the mouth, on the line as defined in
Article 2, para 2 hereof.

For excavation of sand and gravel from non-renewable deposits and for excavation of
rock in the area referred to in para 2 of this Article, and in the sanitary protection
zone, in addition to conditions determined by the Act on Mining, a water rights permit
shall be required.

Article 54.
Legal entities or physical persons excavating sand, gravel or rock in the area pursuant
to Article 53 hereof shall keep the record on the quantity and quality of excavated
material and submit the data to Croatian Waters.

The contents and the manner of record keeping and submitting of data pursuant to
para 1 of this Article shall be determined by the Director.

Article 55.

The legal entity or physical person that excavates sand or gravel in the area pursuant
to Article 53 hereof without water rights permit and concession shall be obliged to
compensate the damage made according to the price list issued by Croatian Waters
with the consent of the Director.

The decision on compensation of the damage shall be issued by Croatian Waters. A
complaint against such decision may be submitted to the State Water Directorate.

The amount paid as compensation for the damage pursuant to para 1 of this Article
shall be the revenue of Croatian Waters and shall be used to repair the damage made
by such action.

Article 56.

The water rights permit, or the concession contract pursuant to Article 53, para 1
hereof shall define in particular the excavation field, the quantity and conditions of
sand, gravel or rock excavation field and its environment to restore the excavation
field and its environment after the excavation is over.


6. WATER ESTATE AND ITS USE

a) Water estate

Article 57.

The water estate is a set of land units including:

- water-bearing and abandoned channels of inland surface water bodies;

- regulated inundation zone; unregulated inundation zone;

- islands formed in the water-bearing channel by drying out, partition of the channel
into arms, alluvial deposits, or by human activity.

The water estate is the estate of interest to the Republic of Croatia enjoying its
particular protection and shall be used in the manner and under the conditions defined
by this Act.

Article 58.
Belonging of a certain piece of land to the water estate is determined by decision of
the qualified administrative body in accordance with prior opinion of Croatian
Waters.

Belonging of land pursuant to para 1 of this Article to the water estate on national
waters shall be decided upon by the State Water Directorate.

Belonging of land pursuant to para 1 of this Article to the water estate on local waters
shall be decided upon by the county office, or offices of the City of Zagreb in charge
of water management (hereinafter: county office).

Article 59.

The water estate shall serve for the purpose of maintenance and improvement of the
water regime, in particular for:

- construction of water works and installation of devices for regulation of
watercourses and other water bodies;

- technical and economic maintenance of watercourses, banks, protective and
regulation works;

- technical maintenance of inland waterways;

- implementation of measures for protection from adverse effects of water, and other
purposes determined by this Act and other regulations based thereon.

b) Public water estate

Article 60.

The public water estate consists of land units pursuant to Article 57, para 1 hereof
which, by the date of entering into force of this Act, were registered in land register as
public estate, water estate, state property or property of local administrative units, or
land units which have become the property of the State in accordance with the law.

The land units, pursuant to Article 57, para 1 hereof, which by the date of entering
into force of this Act were not registered in land register, or were registered without
any reference to the owner, shall be considered public water estate, until the opposite
is proved.

Article 61.

The public water estate is a public estate in general use, and a property of the
Republic of Croatia.

The public water estate is inalienable.

The public water estate shall be managed by Croatian Waters which has the authority
to conclude contracts and take other actions in connection with investments, technical
and economic maintenance, use and renting out (lease) of the estate, except
conclusion of contracts on concession.

Article 62.

On the public water estate, it shall not be possible to acquire the right of property or
any other right, by usucaption.

Acquiring of other rights, except the right of property, over land units pursuant to
Article 60 hereof, is possible only on the basis of the preceding act of Croatian Waters
stating that such right shall not affect implementation of the purposes pursuant to
Article 59 hereof, or that it shall not fully exclude the allowed general use on this part
of the public water estate.

Article 63.

Everybody shall be entitled, under equal conditions, to use the public water estate for
rest and recreation in the manner and to the extent as determined by the town or
municipal council with the consent of Croatian Waters, ensuring however the use of
the water estate for purposes pursuant to Article 59 hereof and other uses in public
interest, in particular the protection of banks and water works.

The activities which, pursuant to para 1 of this article, belong to general use, shall not
be considered damaging to the public water estate until the opposite is proved.

Article 64.

Legal entities and physical persons may acquire the right of economic use of a part of
the public water estate.

The right pursuant to para 1 of this Article, except for purposes pursuant to Article 59
hereof, may be acquired on the basis of contract on concession when so determined
by this Act, and in other cases on the basis of the lease contract.

On the part of the water estate where the right of use, pursuant to paras 1 and 2 of this
Article, has been acquired, its use by other persons may be limited or excluded.

The person using the water estate without authorization shall not be able to achieve
protection of possession.

Article 65.

Land units pursuant to Article 60 hereof may cease to be part of the public water
estate under the following conditions:

1. If the State Water Directorate determines by its decree that the land has become
permanently useless for the purposes pursuant to Article 59 hereof and has therefore
ceased to be the public water estate, and

2. If its property of public water estate, recorded in the land registry, has been deleted.
c) Land units outside the system of public water estate

Article 66.

Land units, pursuant to Article 57 para 1 hereof which are the property of other
persons, as recorded in the land registry, except land units pursuant to Article 60
hereof, shall not be considered part of the public water estate; however, the owners of
such land units shall, in the interest of maintaining of the water regime, allow their
use for all purposes pursuant to Article 59 hereof.

The provisions of para 1 of this Article shall also apply to the parts of land units,
pursuant to Article 57 para 1 hereof, which are under roads or railway facilities,
regardless of the property rights.

Article 67.

Should the land owner intend to sell the land unit pursuant to Article 66 hereof, the
Republic of Croatia shall have the right of first purchase. Transferred into the property
of the Republic of Croatia such land unit shall become part of the public water estate.

Exceptionally, if the land units pursuant to Article 66 hereof are of particular
importance for the maintenance of the water system, they may be expropriated in
favour of the Republic of Croatia in accordance with the law regulating expropriation,
with full compensation of their market value.


7. WATER PROTECTION

Article 68.

Protection of water from pollution (hereinafter referred to as: water protection) shall
be carried out for the purpose of protection of human lives and health and of the
environment, and allowing of harmless and unimpeded water use for various
purposes.

Water protection is achieved through supervision of water quality and sources of
pollution, prevention, limiting or prohibition of actions and behaviour likely to affect
the water quality and the environment in general, as well as by other activities aiming
at protection and improvement of water quality and its suitability for use for various
purposes.

Article 69.

Water pollution is the change in water quality resulting from immission, discharging
or disposal into water of nutrients and other substances, influence of energy or other
agents, in quantities that change the useful properties of water, deteriorate the status
of aquatic ecosystems and limit the water use for various purposes.
The nutrients pursuant to para 1 of this Article are the chemical elements, or
compounds thereof, essential for growth and development of organisms (nitrogen and
phosphorus salts, etc.).

Water contamination is pollution of higher intensity resulting from immission,
discharging or disposal into water of hazardous substances, energy or other agents in
quantities or concentrations exceeding the limit values, which imposes the risk to
human lives and health and the environment or cause disturbance to the economy or
other fields. Any change of water quality deteriorating the water grade as determined
by water classification shall also be considered water contamination.

Article 70.

Hazardous substances, for the purpose of this Act, are the substances, energy and
other agents which by their composition, quantity, radio-active, toxic, cancerogenic,
mutagenic and other properties adversely affect human lives and health and the
environment.

Hazardous substances shall not be discharged or introduced into water or deposited in
areas where it may result in pollution or contamination, except under conditions
determined by this Act and regulations based on this or some other Act.

The Government of the Republic of Croatia shall define what substances and in what
quantities pursuant to para 1 of this Article shall be considered hazardous.

Article 71.

Water classification defines the grades of water corresponding to water quality
conditions in the sense of their general environmental function and to conditions of
water use for various purposes.

Water classification is determined on the basis of limit values of certain substances
and other water properties (indices) allowed for a given grade ow water.

The indices pursuant to para 2 of this Article are, in particular: physical indices,
oxygen regime, nutrients, metals, organic compounds, microbiological indices,
biological indices, and radioactivity.

The water classification is determined by the Government of the Republic of Croatia.

Article 72.

In order to prevent deterioration of water quality and to protect the environment in
general, the limit values of hazardous and other substances shall be prescribed, as
follows:

1. for technological waste water before its release into public sewerage system or
other receiving water,
2. for water being released, after treatment, from the public sewerage system into
natural receiving water,

3. for waste water and substances discharged into sumps and collector tanks.

The regulations pursuant to para 1, items 1 and 2 of this Article shall be issued by the
Director, and the regulation pursuant to item 3 by the county assembly.

Article 73.

Legal and physical persons that, within the scope of their industrial or other activity
introduce, release or dispose hazardous substances likely to cause water pollution
shall be obliged before discharging into the public waste water disposal system or
other receiving water, to eliminate, partly or completely such substances in
accordance with the provisions of this and other Acts, or regulations based thereon.

Article 74.

The activity of waste water disposal, for the purpose of this Act, shall include
collecting of waste water, its transport to the treatment plant, treatment, and release
into the receiving water, processing of sludge generated during treatment, as well as
disposal of rain water from communities through the public sewerage system.

The disposal of waste water shall be carried out without polluting ground water.

The public sewerage system is the set of facilities and plants for carrying out of
activities pursuant to para 1 of this Article.

Article 75.

Legal and physical persons shall discharge waste water into public sewerage systems
or dispose of it in some other way in accordance with the decision on waste water
disposal.

The decision pursuant to para 1 of this Article shall contain in particular: the
provisions on the method of waste water disposal, the obligation of connection to the
public sewerage system, the conditions and manner of waste water disposal in areas
where such system does not exist, particular measures of disposal and elimination of
hazardous and other substances, and the obligation of maintenance of the public
sewerage system.

The decision on waste water disposal on the city, or municipal territory, is issued by
the city or municipal council. In case the same system is used for disposal of waste
water from the territories of several municipalities, the decision is issued by the
county assembly.

Article 76.
Water protection shall be implemented in accordance with the State Water Protection
Plan and the county water protection plans, or the water protection plan of the City of
Zagreb (hereinafter: the county water protection plan).

The water protection plans define in particular: the necessary research and analysis of
water quality, water protection measures including measures for emergency and
accidental pollution, plans for construction of waste water disposal and treatment
plants in communities, the financial requirements, sources and methods of financing,
persons in charge of implementation of plans, their powers and responsibilities.

The plan of construction of waste water treatment plants in the State Water Protection
Plan includes the waste water treatment plants and facilities of not less than 50,000
population equivalent (PE).

The integral part of water protection plans is water categorization. The categorization,
starting from the criteria in water classification (Article 69 hereof), divides individual
watercourses and other water bodies into groups which shall meet the prescribed
conditions of water quality and other water properties.

The county water protection plan must be in accordance with the State Water
Protection Plan.

Article 77.

The State Water Protection Plan is issued by the Government of the Republic of
Croatia.

The county water protection Plan is issued by the county assembly, upon proposal by
Croatian Waters.

The State Water Protection Plan shall be published in Official Journal, and the county
water protection plan in the official bulletin of the county, or of the City of Zagreb.

Article 78.

If, due to reduced flow or other circumstances, the risk arises of deterioration of water
quality in the watercourse or other water body receiving waste water (emergency
pollution), the Director may prohibit or limit waste water discharge in a given area, or
prohibit or limit the persons performing certain activities to discharge technological
waste water.

Article 79.

Should the water pollution risk arise as a result of unexpected circumstances, failure
or other reasons, the legal entity or physical person, whose activity or neglect is in
connection with the occurrence of such risk, shall without delay notify the nearest
police administration.

Each person noticing the occurrence of water pollution or the risk thereof shall,
without delay notify the nearest police administration.
The police administration receiving notice on water pollution or the risk thereof, shall
notify the nearest county water inspector or the nearest office of Croatian Waters.

Croatian Waters or other legal person in charge according to the water protection plan
shall immediately after receiving notification on pollution or risk thereof take
appropriate prevention or remedy measures.

The costs of such measures shall be at the expense of the legal entity or physical
person whose activity or neglect has caused the pollution or pollution risk.

Article 80.

Legal entities or physical persons who, in connection with their economic or other
activities, for which the water rights permit is required, discharge into water
hazardous substances, or who manufacture or sell chemical substances and derivatives
thereof which may pollute water, shall keep the records of such activities and submit
the data thereon to Croatian Waters.

The contents and the manner of keeping the records pursuant to para 1 of this Article
shall be prescribed by the Director.

Article 81.

The contents and quality of water, in connection with monitoring, taking of measures
and imposing of sanctions for non-compliance with the provisions on water
protection, as defined herein, may be determined only on the basis of analysis and
results by licensed laboratories.

The conditions to be met by the licensed laboratories, the scope and the manner of
awarding of the license shall be prescribed by the Director in agreement with the
director of the State Institute for Standards and Measures.


8. REGULATION OF WATERCOURSES AND OTHER WATER BODIES AND
PROTECTION FROM ADVERSE EFFECTS OF WATER

a) Regulation of watercourses and other water bodies

Article 82.

Regulation of watercourses and other water bodies, for the purposes of this Act, shall
include: construction, technical and economic maintenance of regulation and
protection water works and amelioration drainage works, technical and economic
maintenance of watercourses and water estate, and other works facilitating controlled
and harmless water flow and water use.

Article 83.

The following works shall be considered technical and economic maintenance of
watercourses, water estate and water works:
1. maintenance of natural and artificial watercourses: lining of channel and banks with
rock, concrete slabs, wire wicker-work, etc., cleaning and disposal of sediment and
partial deepening of river bed, straightening of bends without significantly changing
the channel route, earthmoving and other works on regulation and maintenance of
river banks, earthmoving works in the floodplain, moving and clearing of vegetation,
reconstruction and maintenance of culverts 5 m,

2. maintenance of regulation and protection works: repair, strengthening and renewal
of dikes, clearing, moving and vegetative protection of works, replacement of a part
of works.

3. maintenance of amelioration drainage works: clearing technical and vegetative
maintenance of works and zones along the works, earthworks on minor additions to
canal networks, straightening of slopes and bends, drainage works, construction of
culverts and similar objects as part of the canal networks, their maintenance and
replacement.

The works under economic maintenance of watercourses and the work estate include
also planting and felling of trees and other vegetation. These measures are applied in
accordance with the regulation issued by the Director, following the expressed
opinion by the minister in charge of forestry.

b) Protection from harmful effects of water

Article 84.

Protection from harmful effects of water includes activities and measures of flood
protection, protection from ice on watercourses, protection from soil erosion and
torrents, and activities and measures aiming at elimination of such effects.

Article 85.

For the purpose of technical and economic maintenance of watercourses and other
water bodies, efficient protection from floods and other harmful effects (torrents,
external water), the inundation zones on watercourses and other water bodies shall be
determined. In such zones, any activities that may deteriorate the water regime and
increase the degree of risk of harmful effects of water shall be prohibited.

The developed inundation zone includes the land between the channel and the outer
edge of corresponding protective regulation works including the land zone required
for their regular maintenance.

The undeveloped inundation zone includes:

- land along watercourses which has been reserved for construction of regulation and
protection works by water management plans or document on physical planning,

- natural and artificial flood storages within the limits determined by the water
management plan or document on physical planning.
The outer limit of the developed and undeveloped inundation zones on national waters
is determined by the State Water Directorate upon proposal by Croatian Waters, and
on local waters by the county assembly upon proposal by Croatian Waters. The limits
of the inundation zones pursuant to paras 2 and 3 of this Article shall be entered into
land registry maps and physical development plans.

Flood defense

Article 86.

Prevention of floods and harmful effects of floodwater includes construction and
maintenance of protection water works, carrying out of protective works and flood
protection measures.

Flood defense may be regular or emergency. Regular, or emergency flood defense is
announced when the water level reaches the altitude determined by the flood defense
plan, and further rising of the water level may be expected.

Article 87.

Flood defense on national waters is carried out in accordance with the State Flood
Defense Plan issued by the Government of the Republic of Croatia.

Flood defense on local waters is carried out in accordance with the catchment area
flood defense plan issued by the county assembly upon proposal by Croatian Waters.

The State Flood Defense Plan shall be published in Official Journal, and the
catchment area flood defense plan in the official bulletin of the county concerned.

Article 88.

The flood defense plan shall contain, in particular: measures to be taken before or
during occurrence of flood hazard, water levels at which, in separate sectors, the
regular or emergency flood defense starts, the list of equipment and material to be
prepared, legal persons in charge of flood defense, the names of professional
organizers of flood defense, their duties, responsibilities and powers regarding
undertaking certain actions related to flood defense, and the manner of informing on
events and measures during the flood defense.

The flood defense plan also contains the measures of protection from ice on
watercourses.

Article 89.

Legal entities and physical persons shall participate with labour and assets (vehicles,
construction material, etc.) in flood defense should the extent of flood hazard becomes
too large to accomplish defense only by the assets and labour of Croatian Waters and
other legal entities in charge of such works. Participation in flood defense is
mandatory, first of all, for legal entities and physical persons in areas threatened by
flood. If their participation is not sufficient to eliminate the direct danger and to
prevent the effects, the person in charge, designated by the flood defense plan shall
require inclusion in flood defense of legal entities and citizens from other areas.

The local authorities shall provide the conditions for implementation of flood defense
plans in their respective areas and issue orders regarding participation of legal persons
and citizens pursuant to para 1 of this Article in flood defense.

Article 90.

In case of flood danger the Director may, in agreement with the Minister in charge of
transport, temporarily limit or prohibit the road, railway or river traffic.

Exceptionally from para 1 of this Article, when urgent action is necessary due to
direct flood danger, the prohibition may be issued by the authorized flood defense
executive.

Article 91.

Legal and physical persons managing storage reservoirs should use them in a manner
allowing the acceptance of the flood wave.

The capacity, or free space in reservoirs and flood storages which must be maintained
in certain seasons, is defined by the water rights permit.

The capacity, or free space in reservoirs and flood storages which must be maintained
in certain seasons, and the conditions of water release, are defined by the water rights
permit.

Protection from Ice

Article 92.

Should the formation and accumulation of ice result in building up of barriers that
might cause a flood, or should the formation and drifting of ice present the hazard of
damage to regulation and protection works, bridges and other stationary or floating
objects in the watercourse, it is necessary to undertake measures defined by the flood
protection plan.

Ice protection measures in order to protect bridges, floating and other objects, owned
by legal entities or physical persons, shall be undertaken by such entities and persons.

In case of hazard subject to para 1 hereof, the Director, with the consent of the
Minister in charge of transport, may temporarily limit or prohibit navigation on inland
waterways.

Protection from Erosion and Torrents

Article 93.
For the purpose of this Act, erosion-prone areas are the areas where the surface or
ground water cause washing away, undermining and collapsing of land, or similar
adverse phenomena which may result in hazards to human lives, health, or property,
and in disturbance of the water regime.

For the purpose of this Act, the torrential watercourses are the periodical
watercourses, as well as permanent watercourses subject, due to rainfall and snow
melting, to rapid changes of water discharge that may result in hazards to human
lives, health and property, and in disturbance of the water regime.

The torrential watercourses with'strong erosion processes presenting hazard to large
urban areas, industrial plants, magistral and regional communications, and land
amelioration systems, are entered in the registry of national waters (Article 17 para 2)

Article 94.

Prevention and elimination of erosion and torrents consists of construction of
regulation and protection structures, protection works and application of protection
measures.

Erosion and torrent protection works include, in particular: afforestation, cultivation
and maintenance of protective vegetation, tracing, vegetation clearing, channel
clearing and similar works.

Erosion and torrent protection measures include, in particular: prohibiting and
restricting tree and bush cutting, prohibiting and restricting sand, gravel and rock
mining, prohibiting waste disposal, appropriate use of agricultural and other land, and
other measures.

Article 95.

Construction, works and measures, pursuant to Article 94 hereof, on individual
catchment areas except on watercourses and waters included in the register of national
waters, are carried out in accordance with the local water management plans pursuant
to Article 12 para 3 hereof.

c) Amelioration Drainage

Article 96.

The amelioration drainage system consists of structures and facilities draining excess
water from agricultural and other land, facilitating directly or indirectly more rapid
and favorable runoff of surface and ground water and providing favorable conditions
for land use and for economic and other activities.

Article 97.

Hydrotechnical drainage facilities, with respect to their purpose, are divided into basic
and detailed drainage facilities.
The basic drainage facilities include:

1. Amelioration watercourses receiving all water from a drainage system (primary
facilities), and pumping stations in the amelioration system,

2. Main drainage canals receiving all water from a drainage system or from a part
thereof, brought by detailed drainage network, and conducting it into primary
facilities (secondary facilities).

Detailed amelioration drainage facilities include:

1. collecting or group canals, accepting water from parcel or detailed canals and
conducting it into secondary facilities (tertiary facilities),

2. parcel or detailed canals directly collecting water from agricultural and other land
parcels and conducting it into tertiary facilities (quaternary facilities),

3. other facilities on amelioration canals (concrete tube, slab or other culverts, flap
valves, syphons concrete or stone sills, chutes, erosion protective linings, weirs, etc.).

Article 98.

The motion for development or construction of a new amelioration system (hereafter:
development of amelioration system) may be brought forward by the town or
municipal authorities or at least 20 percent of all land owners or registerred users
(hereafter: land users) of land in the area where development of such system is
proposed.

The motion referred to in para 1 of this Article is submitted to the relevant town or
municipal council. The motion must be accompanied by:

1. Plan of land parcels in the area where the amelioration system is to be developed,
with the data on land owners and land users,

2. The technical concept of development of the amelioration system, and

3. The cost estimate of the amelioration system development, and costs of land
acquisition for basic facilities, as well as tentative cost allocation among the system
users.

Article 99.

The town or municipal authorities shall upon receipt of the motion, ask Croatian
Waters for professional opinion regarding the compliance of the motion with the
water management plan or the water master plan, and forward it to the town or
municipal council making the decision on acceptance of the motion.

Should the town or municipal council decide to accept in principle the motion, it will
determine the period for carrying out the public hearing in all land district envolved in
the amelioration system, and define the way of conducting the public hearing.
Article 100.

The decision on commencing of development of the amelioration system is made by
the County assembly on the basis of feasibility assessment and the status of financing
sources.

The finds to finance the works on amelioration system development are provided by
the budget of the County and town, or municipality where the works are to be carried
out.

The local administration and authorities referred to in para 2 of this Article shall be
entitled to impose specific fee the for recovery of costs. Such fee is introduced and
paid in accordance with the law regulating the financing of water management. The
fee shall be paid by all users of the amelioration system.

Article 101.

The County assembly may, in the decision pursuant to Article 100 para 1 hereof,
determine that the land owners shall be responsible to complete the detailed
amelioration facilities, and specify the conditions for completion thereof.

Article 102.

A completed amelioration system may be used after the water rights permit for its use
has been obtained.

Article 103.

Technical and economic maintenance of the amelioration system shall be carried out
in accordance with the plan pursuant to Article 12 hereof.

The users of the amelioration system shall reguraly maintain the detailed amelioration
works in accordance with the decision of the town or municipal council in the area
covered by the system. Should the amelioration system cover the territories of several
towns or municipalities. Such decision is issued by the County assembly.

The decision pursuant to para 2 of this Article is issued upon prior opinion by
Croatian Waters.

Should a user fail to carry out the maintenance works on the basic amelioration
facilities, and should this cause damage on the neighbouring or other land, he shall be
responsible for the resulting damage.

The level of compensation for the damage referred to in para 4 of this Article shall be
determined by a special commission established in accordance with the decision
pursuant to para 2 of this Article.

Article 104.
For the purpose of evacuation of water from the amelioration drainage system, the
rights of way may be established.

In establishing the right of way, the provisions of Article 47 para 2 and 3 hereof shall
apply.

Article 105.

More detailed regulations on! technical, economic and other conditions for
development of amelioration drainage systems and on technical and economic
maintenance of the system are issued by the Director.


9. LIMITATION OF LAND OWNERS' AND LAND USERS' RIGHTS AND
SPECIFIC MEASURES FOR MAINTENANCE OF THE WATER REGIME

Article 106.

For the purpose of protection and maintenance of regulation, protection and other
water works, and in order to prevent deferioration of the water regime, the following
shall be forbidden:

1. on dikes and other regulation and protection water works to excavate or deposit
earth, sand, gravel, to allow cattle to graze, to pass and drive motor vehicles, except in
places where it is explicitly allowed, and to carry out other activities that may impair
safety and stability of such works,

2. in regulated innundation zone, to plough land, plant and cut trees or bushes,

3. in regulated innundation zone and to the distance of 20 m from the outer dike foot,
to erect buildings, fences and other structures, except regulation and protection water
works, to excavate rock, clay and other substances, to dig or drill wells, and to carry
out any other drilling works without water rights permits.

4. in unregulated innundation zone, to perform activities listed in para 2 hereof,

5. on amelioration drainage canals managed by Croatian Waters and in the zone 5 m
from the canals required for their regular maintenance, to plough or dig soil and to
carry out other activities likely to damage the amelioration water works or disturb
their performance.

6. to deposit into watercourses and other waters, storages, flood storages, amelioration
and other canals, and in the flood zone, earth, rock, waste and other substances and
carry out other works likely to change the course, water level, water quality or
quantity, or make difficult maintenance of the water system.

Exceptionally, at the request of the interested party, Croatian Waters may allow
exemption from the provisions of para 1 of this Article, provided this does not
threaten the stability and safety of the water works, deteriorate the existing water
regime, and provided this is not contrary to the conditions of use of the water estate as
defined by this Act.

The legal entity managing the forests that are government property may, in the flood
plain cultivate and cut trees provided this is in compliance with the forestry master
plan, and that its provisions referring to the flood zone have been approved by
Croatian Waters.

Article 107.

Should any of the actions referred to in Article 106 para 1 hereof result in any
damage, the person responsible for the damage shall re-establish the original status
within the time period determined by the water inspector, based on the proposal by
Croatian Waters.

Should the person responsible for the damage in accordance with para 1 of this Article
fail to re-establish the original status, the necessary works shall be carried out by
Croatian Waters, at the expense of the person responsible for the damage.

If it is not possible to repair the damage as described in para 1 and 2 of this Article,
the person responsible for the damage shall be liable to compensate the damage in the
amount determined by the water management, according to the price list brought
forward by Croatian Waters with the consent of the Director.

Article 108.

Roads and crossings on the water estate, regulation and protection water works should
be maintained to prevent accumulation and retaining of water that may reduce their
resistivity and functionality. Until such condition is established, the responsible
administration body shall issue a decision forbidding their use.

The decision pursuant to para 1 of this Article regarding roads and crossings on
national waters is issued by the State Water Directorate, and for such facilities on
local waters by the responsible County office.

Article 109.

For the purpose of flood protection, land users and land owners in the threatened area
shall, at the requirement by Croatian Waters:

1. allow the use of sand, gravel, earth or rock from their land,

2. allow passing of persons and vehicles over their land.

if the person, referred to in para 1 of this Article does not allow the use of material or
passage, the responsible County court shall order such person to comply with the
provision hereof.
The persons referred to in para 1 shall be entitled to compensation for the material
used or damage inflicted. If the parties fail to reach agreement, the amount of
compensation shall be determined by the court.

Article 110.

Land owners and land users must allow crossing of their land for the prupose of
survey, measuring or staking in connection with construction of water works, and
technical and economic maintenance of water courses and water works.

Decisions regarding the request in para 1 of this Article are made by the relevant
County office. Any complaint against such decision shall not delay its
implementation.

Persons referred to in para 1 are entitled to compensation of damages. Should the
parties fail to reach agreement, the amount of compensation shall be determined by
the court.

Article 111.

Land owners and land users shall not, without a water rights permit

1. change or intersect the ground water flow, or use ground water to the extent that
may imperil the supply of other persons with drinking and technological water, and
threaten mineral and thermal springs, stability of soil and structures,

2. change the direction and flow of surface water running through or off their land.

Should a person act contrary to this provision, the county office shall issue a decision
forbidding such illegal behaviour and order re-establishing of the original status. Any
complaint against such decision shall not delay its implementation.

Compensation for damages resulting from behaviour contrary to the provision of para
1 shall be decided upon by the court.

Article 112.

In case water evacuation from the land or bringing water to the land cannot be
accomplished in any other more favourable and more economical manner the right of
way may be stablished, with proper compensation.

Should the interested parties fail to reach agreement, establishing of the right of way
and the level of compensation shall be decided by the court.


10. WATER-RELATED DOCUMENTS

Article 113.
Water-related documents include: the water register, water inventories and a record of
concessions on water and water estate.

Article 114.

The water register contains the data on issued water rights terms and water rights
permits. The water register also records other legal documents issued prior to the
entry into force of this Act for the purpose of ensuring the water regime (terms,
approvals and permits).

The water register also records all subsequent changes regarding the status, rights and
duties pursuant to documents mentioned in para 1.

The water register is kept by Croatian Waters.

Article 115.

The water inventories consist of the following: inventory of water, water estate and
water works, inventory of water use and inventory of water conservation.

The inventory of water, water estate and water works contains the data on surface and
ground water, regulation and protection waterworks, and amelioration drainage water
works.

The inventory of water use contains the data on the sources and other deposits of
water for drinking, technological and other purposes, and the data on water intake,
treatment and distribution facilities.

The inventory of water conservation contains the data on the sources of pollution and
contamination, wastewater disposal systems and other relevant data important for
water conservation.

The water inventories are kept by Croatian Waters.

Article 116.

The record of concessions on water and water estate contains the data on decisions
and contracts regarding concessions on water and on water estate.

The record referred to in para 1 is kept independently from the register of concessions
kept pursuant to the Concession Act.

Article 117.

Water-related documents are kept and used in accordance with the publicity principle.

Any person has the right to require and obtain any data from water-related documents
upon payment of a corresponding compensation for the costs of the data transcripts.
Exceptionally, the right of looking into and use of some data from water-related
documents, expressed in para 1 above, may be limited by the provision of Article 118
hereof.

Article 118.

Detailed regulations regarding the contents, format and the method of keeping of
water-related documents, the amount and payment of costs of transcripts, and the use
of the data, are defined by the Director.

The provision in para 1 above provides for the adjustment of the water inventory and
the water conservation inventory with the environmental protection information
system.

                             III. WATER RIGHTS ACTS

Article 119.

Water rights acts are issued to ensure a uniform water regime and to establish water
management in accordance with the provisions of this Act.

The water rights acts include: water rights terms, water rights approval, water rights
permit and permit ordinance.

The water management legal arts are administrative acts.

The procedures of issuing water rights acts are subject to the provisions of the General
Administrative Procedure Act, unless specific procedures are prescribed by this Act.

The personnel of Croatian Waters authorized to issue water rights acts must be
properly qualified and hold licenses as required for government officials.

Article 120.

When the water rights acts except permit ordinances, in accordance with this Act, are
issued by the County office in charge of water management affairs, the complaints
shall be considered and decided by the State Water Directorate.

By exception from para 1 above, complaints shall not be permitted against legal acts
issued by the State Water Directorate. Against such acts, administrative process may
be instituted directly.

Article 121.

Detailed regulations regarding the contents, form and manner of issuing water rights
acts, issuing of transcripts, contents and manner of record keeping, specific costs
related to he issuance of such acts and their covering, keeping and filing of the acts
shall be defined by the Director.
1. WATER RIGHTS TERMS

Article 122.

The water rights terms determine the conditions to be met by the documentation for
construction of new and reconstruction of existing structures, and for regional and
detailed geological research works, as well as other works which are not regarded as
construction, that may permanently, periodically or temporarily affect the water
regime (hereafter: other works).

Water rights terms are not required for the construction or reconstruction of
residential and other buildings in which water is used only for drinking and sanitation
- provided such buildings are connected to the water supply system (Article 34) and
the public sewerage system (Article 74).

Regulations pursuant to Article 121 hereof may define in more detail the cases,
referred to in para 1 above, for which water rights terms are not required.

Article 123.

Water rights terms are issued by Croatian Waters.

By exception from para 1 above, the water rights terms are issued by Croatian Waters
with the confirmation by the State Water Directorate:

1. for construction on interstate waters,

2. for construction of international and major pipelines for transport of hazardous
substances, main roads and highways, railways, international airports, inland
navigation waterways, river and sea ports,

3. for construction of hydropower or thermopower plants of 20 MW and more,
nuclear powerplants, junction and transformer plants and high-voltage lines of 110 kV
and more,

4. for construction of plants and development of terrain for storage, processing or
disposal of hazardous waste.

In the procedure of application for water rights terms for construction of inland
navigation waterways, river and sea parts it is necessary to obtain the opinion of the
ministry in charge of traffic.

Article 124.

The body in charge shall refuse the application for water rights terms:

1. for construction or extension of the capacity of the sewage disposal facilities, if no
decision regarding sewage disposal has been made (Article 75),
2. for extension of the plant capacity, or change of technology in the industry
discharging waste water that should be treated prior to discharge, in which such waste
water was not treated in the past, unless the new investment provides for waste water
treatment for the whole plant.

Article 125.

If a person who has obtained water rights terms intends to carry out, on facilities and
plants that are subject to the terms, any modifications, changes of technological or any
changes likely to affect the water regime, such person shall apply for modification of
the water rights terms or for new terms to be issued.


2. WATER RIGHTS APPROVAL

Article 126.

The legal or natural person that has obtained water rights terms must, before the start
of construction or other works, apply for water rights approval from the relevant body
referred to in Article 123 hereof.

The water rights approval confirms that the documentation for construction or other
works is prepared in accordance with the water rights terms.
The water rights approval is issued in the form of a clause in the water rights terms.

Exceptionally, if the documentation for construction or other works has not been
prepared in compliance with water rights terms, the relevant body referred to in para 1
above shall decide to refuse to issue the water rights approval.

The relevant body shall issue the approval or decision referred to in para 4 above
within 15 days from the date of properly submitted application.

Article 127.

The validity of water rights terms, for which approval has not been required, shall
expire by expiration of the period of two years from the date of issue.

The validity of water management terms for which the approval has been issued shall
expire by expiration of the period of two years from the date of issuing of the
approval if by that date the application for construction permit, or the works for which
the construction permit is not required have not been commenced.


3. WATER RIGHTS PERMIT

Article 128.

The water rights permit regulates the permission for water use and defines the
purpose, location, method, conditions and extent of water use and discharge of treated
and untreated water, hazardous and other substances that may pollute or contaminate
water.

The water rights permit may also define special conditions, which in accordance with
this Act, ensure the general use of water and protection of public interests concerning
water.

Article 129.

The water rights permit is required for water use and discharging of waste water in
connection with industrial and other activities, and with other activities involving
water intake and use and discharging of waste water, as well as for sand, gravel and
rock excavation in areas of importance to the water regime (Article 53).

The water rights permit is also required for the production and distribution of
chemicals and their derivatives which after being used reach water.

Article 130.

The water rights permit is not required:

1. for water use pursuant to Articles 26 and 28 hereof,

2. for the use of water from public water supply systems,

3. for the works pursuant to Article 83 hereof,

4. for water use for navigation

5. for discharging of waste water from households and legal entities using water only
for the purpose and within the limits defined by Article 26 para 2 hereof, and
discharging waste water into public sewerage systems.

6. for production and traffic or chemicals and their derivatives which after use get into
water, for which the permit is required under another Act; such permit is issued in
procedure in which the State Water Directorate also takes part.

The regulations of Article 121 hereof define in more detail the cases in para 1 above
for which the water rights permit is not required.

Article 131.

The water rights permit is issued by the relevant County office, based on prior opinion
from Croatian Waters.

Exceptionally, the water rights permit is issued by Croatian Waters, with validation by
the State Water Directorate:

1. for industrial or other activities involving the intake and use of water from an
interstate watercourse or discharging of waste water into an interstate watercourse,
2. for activities in chemical, textile, leather, food-processing, metal, construction,
Petrochemical and other industries involving hazardous substances in the
technological Process (Article 70),

3. for activities and services in sea and river transport (ports and harbors),

4. for hydropower plants with the capacity of 20 MW or more,

5. for transport and storage of oil, gas and other hazardous substances,

6. for water supply systems exceeding the capacity of 10 I/sec (Article 34 hereof),

7. for running of public sewerage systems (Article 74),

8. for excavation of sand, gravel and rock on inland waterways, except in the case
stipulated by Article 130 para 1 item 3 hereof.

For the issue of water rights permit in cases under para 2, items 3 and 8, of this
Article, it is necessary to obtain the opinion from the ministry in charge of traffic.

Article 132.

Water rights permits for the distribution of chemicals and their derivatives that after
being used reach water, shall be issued by the State Water Directorate.

Article 133.

The water rights permit is issued for a specified period, not longer than 15 years, and
for water use on the basis of a concession agreement, for the period equal to the
validity of concession.

The application for prolongation of the water management permit may be submitted
not earlier than six, and not later than two months before the date of expiration of the
present permit.

Article 134.

The rights resulting from the water rights permit shall cease:

1. with expiration of the period for which the permit was issued,

2. if the holder of the permit waives the rights resulting from the permit,

3. with cessation of the activity for which the permit was issued,

4. due to interruption of water use, for which the permit was issued, for a period
longer than one year, without good reason.

Cessation of rights under water rights permit for reasons in para 1 of this Article is
determined by the decision of the body which has issued the permit.
4. PERMIT ORDINANCES

Article 135.

The permit ordinance is a document issued along with the water rights permit in order
to adjust the behavior and activities of the permit holder with the conditions and
responsibilities resulting therefrom.

The permit ordinance orders the holder of the water rights permit to take action, carry
out an investment or abstain from some action in order to eliminate the risk of
possible or already existing disturbance, or noncompliance with the conditions and
responsibilities under the water rights permit, and to establish the conditions in
compliance with this act.

The format and the manner of issuing of the permit ordinance is subject to the
provisions on resolution in administrative procedures, unless otherwise specified by
this Act.

Article 136.

The permit ordinance is issued by the same body that has issued the water rights
permit.

Permit ordinances may be issued during the entire period of validity of the water
rights permit.

A copy of the permit ordinance is sent to the relevant water inspector.

Article 137.

Complaints against the permit ordinance may be submitted to the body issuing the
water rights permit.

In response to a complaint, the body in charge may decide as follows:

1. reject the complaint as unwarranted,

2. cancel the permit ordinance if the complaint is found justified, and that there was
no reason for issuing of the ordinance,

3. modify the permit ordinance if the complaint is found partly justified.

Article 138.

The deadline for issuing of the resolution pursuant to Article 137 para 2 hereof shall
be 15 days from the date of submission of the objection.

The resolution pursuant to Article 137 hereof shall be final.
The objection shall not delay complying with the permit ordinance.

Article 139.

Non-compliance with the permit ordinance may be sanctioned by penalty with
temporary withdrawal of the water rights permit, or by penalty and withdrawal of the
water rights permit.

The penalty pursuant to para 1 above may be pronounced in an amount from 400 to
40,000 Croatian Kunas.

The decision on the penalty and withdrawal or temporary withdrawal of the water
rights license shall be made by the State Water Directorate.

Article 140.

The water rights permit shall be withdrawn temporarily if the holder, within the
period specified by the permit ordinance, fails to take action or carry out the
investment, or does not abstain from some action, as required by the ordinance,
provided this non-compliance does not impose the hazard of the effects mentioned in
Article 141 para 1 item 2.

The water rights permit may be withdrawn temporarily for the period of six months
during which the holder's rights based on the permit shall be suspended.

Article 141.

The water rights permit shall be withdrawn:

1. if the holder fails, within a specified period, to carry out the activities or
investments, or to abstain from some activities as required by the permit ordinance,
for which reasons the water rights permit has been temporarily withdrawn.

2. if non-compliance with the permit ordinance is likely to result in serious hazard to
human lives and health or in economic problems.

The holder whose water rights permit has been withdrawn may apply for the new
permit after six months from the date of entering into force of the withdrawal.

               IV. CONCESSION ON WATER AND WATER ESTATE

Article 142.

Concession is a means of acquiring the right to use water and public water estate, or
the right to carry out industrial and other activities on water and on public water
estate.

Article 143.

Concession on water and public water estate is required for:
1. water intake for public water supply,

2. use of water power for production of electric energy,

3. use of water power for driving of plants (other than production of electric energy),

4. water intake for technological and other purposes by legal entities and persons
carrying out industrial and similar activities,

5. pumping of mineral and thermal waters,

6. water intake for irrigation,

7. development of navigation waterways on rivers and lakes, construction of canals
and other facilities for navigation purposes,

8. construction of river parts and part facilities,

9. fish breeding in closed waters and industrial fish breeding in open waters,

10. industrial and other use of public water estate including construction of permanent
structures or installation of plants,

11. use of public water estate for sports and recreation purposes including
construction of permanent structures,

12. for excavation of sand and gravel (Article 53 para 2) by dredgers or other similar
devices.

Exceptionally, by provision of Article 155 hereof it may be decided that water or
water estate may be used without concession for purposes pursuant to para 1 items 6
and 12 of this Article, provided the particular use concerned is of minor extent and
does not involve construction of permanent structures and installation of plants. For
such use of water and water estate Croatian Waters and the user shall conclude an
agreement in accordance with the regulations on contractual relations.

Concession is not required for investments and activities under para 1 above, which
are performed for and on behalf of the government, provided this does not offer the
basis to other legal entities or physical persons to acquire any property rights.

Article 144.

Concession for the purposes pursuant to Article 143 para 1 items 2, 5, 7, 8, 9 and 12 is
awarded through the public competition.

Concessions for other purposes are awarded on the basis of collection of bids or on
direct application, unless the body awarding the concession (Article 145) decides to
open public competition in these cases as well.
Concession is awarded for a definite period in accordance with the provision of
Article 155 hereof.

For awarding of concession, the conditions, defined in the documents on physical
development, must be fulfilled.

Article 145.

The decision on concession awarding defines in particular: the subject of concession,
the expected extent of use of water or water estate, the concessionaire, the purposes
for which the concession is awarded, duration of concession, the amount of
concession charge or the basis for calculation of the amount.

The decisions on concession awarding pursuant to Article 143 hereof are issued:

1. for electric power plants of 20 MW and more, for development of navigation
waterways on rivers and lakes construction of artificial canals and other facilities for
navigation purposes, for construction of river ports and port facilities - by the House
of Representatives of the Parliament of the Republic of Croatia,

2. for electric power plants from 5 to 20 MW, water intake for public water supply
with the capacity exceeding 100 I/sec, for pumping of mineral and thermal waters and
for fish-breeding on areas larger than 5 ha - by the Government of the Republic of
Croatia,

3. for electric power plants under 5 MW (small hydropower plants), for water intake
for public water supply of the capacity under 100 I/sec, use of water power for driving
of other plants, water intake for technological and similar purposes by legal entities
and persons carrying out industrial or similar activities, water intake for irrigation,
fish-breeding on areas smaller than 5 ha, and for sand and gravel excavation by
dredgers or similar devices, in the areas defined in Article 53 para 2 hereof - by the
State Water Directorate.

4. for industrial and other use of public water estate including construction of
permanent structures and .installation of plants, and for the use of public water estate
for sports and recreation purposes including construction of permanent structures - by
the County administration.

The decision on concession is issued upon previously obtained professional opinion
by Croatian Waters, and for the purposes pursuant to Article 143 items 7 and 8 hereof
the opinion of the ministry in charge of transport is also required.

Article 146.

On the basis of the decision on concession, the concession agreement is concluded.

The concession agreement, in accordance with the decision on concession shall
define: more detailed purposes for which the concession is awarded, particular
conditions to be met by the concessionaire during the period of concession, the level
of the concession charge, conditions and methods of payment, other rights and
responsibilities of the concessionaire and the concession awarder, and the method of
settlement of relations in case of concession cessation before expiry of the period for
which the concession was awarded.
The concession agreement for purposes pursuant to Article 145 para 2 items 1, 2 and
3 hereof is concluded between the State Water Directorate and the concessionaire, and
the concession agreement for purposes pursuant to Article 145 para 1 item 4, between
Croatian Waters and the concessionaire.

Article 147.

The amount of the concession charge is determined in dependence of the purpose,
extent and size of the investment, benefits and material effects of the concession, in
accordance with the criteria determined by the provisions of Article 155 hereof.

The body deciding on the awarding of concession may decide that the concession
charge be paid in a symbolic amount, provided the concession is awarded for
municipal purposes of the local communities, or for social and other activities, except
industrial and other activities based on the market principles.

The basis and the criteria for determining of the amount of concession charges are
defined by the provisions of Article 155 hereof.

Article 148.

The rights and responsibilities of the concessionaire pursuant to the concession
agreement may be vested to another person with the consent of the body that has
awarded the concession.

The rights and responsibilities of the concessionaire pursuant to the concession
agreement may be, under the conditions of this Article be transferred to another
person by right of sucession. If the successor of the concession rights is not
determined by the concessionaire's will, the successors may agree that the rights and
responsibilities resulting from concession be transferred to one or several individual
successors.

To acquire the rights subject to para 2 above, the successor shall, within three months
from entering into force of the probate, submit to the State Water Directorate the
application for modification of the concession agreement containing the following
enclosures:

1. valid probate,

2. agreement between successors regarding the transfer of rights to one or several
successors, if the concessionaire's rights are transferred only to individual successors;

3. evidence of compliance with the requirements stipulated by the concession
agreement.

Article 149.
The concession agreement shall cease

1. upon expiration of the period for which the concession was awarded,

2. upon death of the concessionaire unless, in accordance with Article 148 hereof, the
rights and responsibilities resulting from the concession agreement are transferred to a
successor.

3. if the concessionaire, by valid verdict or by decision of relevant administration
body, is lastingly forbidden to perform the activities for which the concession was
awarded,

4. by consenting termination of the concession agreement.
In case of dispute regarding termination of the contract agreement for reasons
pursuant to para 1 above, the dispute shall be settled at court.

In case of cessation of concession by expiration of the period for which the
concession was awarded (para 1 item 1) the right of property on real estate, plants and
objects serving directly for performance of the concession shall be transferred to the
Republic of Croatia, unless otherwise stipulated by the decision and concession
agreement.

In case of concession cessation for reasons defined in para 1 items 2 and 3 above, the
concessionaire shall be bound to establish the previous status, unless otherwise
stipulated by the concession agreement, provided this does not result in damage to the
water estate and deterioration of the water regime.

The concession agreement may stipulate that in case of cessation for reasons
mentioned in para 1 items 2, 3 and 4 of this Article, the rights and responsibilities
from the concession may be transferred to a new concessionaire, under the condition
that such concession relation may not last beyond the expiration of the period for
which the concession was awarded to the original concessionaire.

Article 150.

The concession agreement may be terminated before expiration of the period for
which the concession was awarded

1. if the concessionire has not, within the specified period, commenced or completed
the works he was bound to carry out in accordance with the concession agreement,

2. if the concessionaire stops to perform continuously the activity for which the
concession was awarded, and the rights and duties are not taken over by the new
concessionire in accordance with Article 149 para 4 hereof after expiration of six
months from the date of determining cessation of the activity.

3. if the concessionaire arbitrarily makes changes on plants used to perform the
activities under concession, fails to maintain structures and plants, or arbitrarily
changes the conditions under which the concession was awarded, causing the risk of
disturbance of the water regime and effecting other persons' legal rights on water and
water estate, and fails to establish the original status within the period determined by
the relevant body.

If in cases under para 1 above the agreement regarding termination of concession is
not reached, the decision shall be made by the court.

In termination of the concession agreement for reasons under para 1 above, the
provisions of Article 149 para 3 and 4 shall apply.

The concessionaire whose concession agreement has been terminated for reasons
under para 1 above shall not be entitled to any indemnification for damages resulting
from the agreement termination.

Article 151.

The concessionaire shall be bound to take the measures to protect human lives and
health, environment and property of other persons from floods erosion and other
adverse effects of water which may occur as a result of structures and plants erected
on water and water estate under the concession.

Article 152.

Should any changes of the water regime occur during the concession period resulting
in the need, in public interest, to limit the extent of concession or to adjust to the new
situation, the concessionaire shall be bound to take actions and measures ordered by
the body that awarded the concession, or by the authorised legal entity.

In the case under para 1 above the concessionaire shall be entitled to indemnification
for the real damage.

Article 153.

The determined concession charge shall be paid

1. for concessions under Article 145 para 1 items 1 and 2 hereof - to the Government
budget,

2. for concessions under Article 145 para 1 items 3 and 4 - to the County budget, or
the budget of the City of Zagreb.

Article 154.

Technical tasks related to preparing of decisions on concession and supervision over
the fulfillment of obligations under the concession shall be performed by Croatian
Waters.

Article 155.

Detailed regulations regarding the period for which a concession is awarded, the basis
for determining the level of the concession charge, the method of conducting the
public competition and collection of bids, and smaller extent of water and water estate
use for which concession is not required, shall be prescribed by the Government of
the Republic of Croatia.

                V. ORGANIZATION OF WATER MANAGEMENT


1. CROATIAN WATERS

Article 156.

For the purpose of performing of the activities constituting the management of state
and local waters, this Act establishes a legal entity under the name: "Croatian Waters -
pravna osoba za upravljanje vodama".

The short name shall be Croatian Waters.

The Seat of Croatian Waters shall be in Zagreb.

Unless otherwise stipulated by this Act, Croatian Waters shall be subject to
regulations applicable to institutions.

Article 157.

The duty of Croatian Waters is constant and undisturbed performing of public
services and other tasks accomplishing managing of water to the extent determined by
the accepted plans and in accordance with the funds provided for such purposes on the
basis of laws and regulations based on the laws.

With regard to the public services Croatian Waters has the public authority
determined by this Act, to issue administrative and other acts and to make decisions
on issues of importance to water management.

Article 158.

The activities of Croatian Waters include:

1. regulation and improvement of operation in economy - water management (75.13,
National Classification of Activities, hereafter: Classification)

2. research and experimental development in technical and technological science
(73.10.2, Classification)

3. architectural and engineering activities and technical consulting (74.20,
Classification)

4. technical examination and analysis (74.30, Classification).

The tasks performed by Croatian Waters in the framework of the activities pursuant to
para 1 above are, as follows:
1. preparing of water management plans, water management schemes of catchment
areas and other plans for water management,

2. preparing of terms of reference, concept solutions, studies and investment programs
and reviewing of designs,

3. regulation of watercourses and other water bodies and protection from adverse
effects of water - monitoring of the situation and control of watercourses and other
water bodies, organization of protection from floods and ice, protection from erosion
and torrents, organization of construction technical and economic maintenance of
watercourses and water works,

4. managing of ameliorative irrigation and drainage systems - organizing of
construction, maintenance and utilization,

5. water use - determining of water resources, control of the status of water resources,
adjustment of water use plans made by other legal entities and control of their
implementation, and other measures for functional and rational water use,

6. water protection - monitoring and determining of water quality, organizing of
implementation of the National Water Protection Master Plan, coordination of water
protection plans of the local administrative units and other plans for investment in
water protection, and control over their implementation, measures for prevention and
elimantion of water pollution,

7. managing of the public water estate,

8. keeping of water-related documentation and managing of the integrated water
information system,

9. technical operations related to awarding of concessions on water and public water
estate,

10. supervision over the implementation of terms and conditions stipulated by water
rights acts and concession agreements (water management supervision),

11. tasks related to implementation of plans for water management,

12. supervision over construction of water works,

13. planning and raising of funds for financing of water management activities and
tasks in accordance with a separate law, and

14. other tasks introduced into the scope by this or other Act and by the Statute of
Croatian Waters (hereinafter: the Statute).

Article 159.

The property of Croatian Waters consists of:
1. the assets and property rights of Javno vodoprivredno poduzece "Hrvatska
vodoprivreda" whose legal successor is Croatian Waters, and of the public water
management enterprises of catchment areas pursuant to Article 202 item 3 hereof,

2. a part of assets (property) of public water management enterprises of catchment
areas which are transferred by law to Croatian Waters (Article 203).

The property of Croatian Waters also includes other assets acquired by this legal
entity in accordance with this Act.

Should Croatian Waters in carrying out its activities, gain profit, the profit may be
used exclusively to improve the working conditions and for investing in improvement
of the water system in accordance with the decision of the Management Council in
agreement with the Director.

Article 160.

Croatian Waters shall guarantee for its commitments by its complete assets.

The Republic of Croatia shall guarantee solidarily and absolutely for the
commitments of Croatian Waters.

Article 161.

Croatian Waters shall not, without the consent of the Director, acquire, abalienate or
encumber real estate and other property, the value of which exceeds the amount
determined by the Statute.

Article 162.

The governing body of Croatian Waters is the Management Council. The
Management Council consists of seven members, appointed and dismissed by the
Government of the Republic of Croatia.

The members of the Management Council are nominated primarily from among
public officials and professionals in the field of water management, economy and
public finance.

The person who is in business relations with Croatian Waters cannot be a member of
the Management Council.

The Government of the Republic of Croatia may dismiss a member of the
Management Council before expiration of his mandate, and is obliged to do so in case
of circumstances Subject to para 2 above.

Article 163.

The Management Council:

1. passes the Statute, with consent of the Government of the Republic of Croatia,
2. passes water management plans,

3. passes the financial plans and the annual statement,

4. passes the decision on internal organization,

5. passes the general documents required for operation of Croatian Waters and other
documents to be passed by Croatian Waters in accordance with this Act,

6. passes its Rules of Procedure,

7. discusses the Manager's reports,

8. makes the decisions on founding of commercial companies and other legal entities,
and on investing in such legal entities,

9. makes the decision on taking the loans exceeding the amount determined by the
Statute,

10. appoints the members of other bodies of Croatian Waters, unless the Statute or the
act on founding of such body stipulates otherwise,

11. performs other tasks and duties determined by the Statute and general regulations
of Croatian Waters.

The acts pursuant to para 1 items 2, 3, 4, 8 and 9 of this Article are passed with the
consent of the Director.

Article 164.

The Management Council is presided by the Chairperson, elected by the members of
the Council.

Article 165.

The Management Council carries out discussions and makes decisions at sessions
which must be attended by at least five members of the Council. The decisions are
made by the majority of votes of the members present.

Exceptionally from para 1 above, the decissions on issues pursuant to Article 163 para
1, items 1, 2, 3, 4, 8 and 9 hereof require the two-thirds majority of votes of all
members of the Council.

Article 166.

In their actions and decisions in the Council, the members of the Management
Council shall act conscientiously and in accordance with this Act and the general
regulations of Croatian Waters.
The members of the Management Council are entitled to salary for their work in the
Council, in accordance with the Statute.

Article 167.

The leader of operations of Croatian Waters is the Manager. The Manager:

1. organizes the operations,

2. represents and acts on behalf of Croatian Waters,

3. takes all legal actions for and on behalf of Croatian Waters,

4. proposes water management plans, financial plans and the annual statement,

5. submits reports on the status of the water regime and on operations of Croatian
Waters,

6. performs other tasks and duties in accordance with the Statute.

The Manager shall be responsible for the legality of operation of Croatian Waters.

Article 168.

The Manager is appointed and dismissed by the Government of the Republic of
Croatia, upon proposal by the Director, for the period of five years.

The conditions to be met by the person to be appointed the Manager are defined by
the Statute.

Article 169.

Croatian Waters may also form other supervisory and technical bodies. The
membership, way of establishing, scope and operation of such bodies are defined by
the Statute or by another document based on the Statute.

Article 170.

Internal organization of Croatian Waters is defined by a separate general document
passed by the Management Council with the consent of the Director. The internal
organization is determined in accordance with the principles of internal organization
defined by the Statute.

For the purpose of operative management of the water system, organizational units
are established,

1. Water Management Department of the Sava Basin, with the seat in Zagreb,

2. Water Management Department of the Drava Basin with the seat in Osijek,
3. Water Management Department of the Littoral and Istrian Basin, with the seat in
Rijeka,

4. Water Management Department of the Dalmatian Basin, with the seat in Split

5. Water Management Department of the City of Zagreb, with the seat in Zagreb.

The water management departments do not have the status of legal entities.
For the purpose of performing direct tasks pursuant to Article 158 items 3, 4, 5, 6 and
7 hereof, water management branch offices of catchment areas are formed within the
water management departments.

Article 171.

The Statute of Croatian Waters defines, in particular: the powers and ways of
decision-making of the bodies and the Manager, the principles of planning, internal
organization, of funds, methods of cooperation with local authorities on water-related
issues, publicity of operation as well as other issues to be regulated by the Statute in
accordance with this or any other Act.


2. ACTIVITIES OF PARTICULAR IMPORTANCE FOR WATER
MANAGEMENT

Article 172.

The activities of particular importance for water management which require meeting
of special conditions prescribed by this Act or by regulations based hereon:

1. architectural-engineering activities (74.20, Classification):

- preparing of designs of water works and water systems,

2. earthmowing works (45.11, Classification):

- maintenance of the water estate, regulation and waterworks and plants,

- maintenance of ameliorative irrigation and drainage systems,

- technical operations in flood protection and other forms of protection from water,

3. construction of hydrotechnical facilities (45.25, Classification):

- regulation of watercourses and other water bodies (regulation works),

4. services in crop farming (01.41, Classification):

- handling of irrigation systems,

5. water gathering, treatment and distribution (41.00, Classification):
- water supply activity (Article 31),

6. waste water disposal (90.00, Classification)

- public waste water disposal (Article 74).

*** FALI PRIJEVOD 173. -176. ***

Article 173.

Operations under Article 172 items 2, 3 and 4 hereof on a given catchment area are
entrusted by ?Hrvatske vode? to a legal entity meeting the conditions pursuant to
Article 174 hereof and having the seat in the catchment area. This is regulated by a
contract awarded for a period of one or more years.

lf such a legal entity has not been established in the catchmeflt area, the contract is
awarded to another legal entity registerred tor such operations.

Article 174.

The special conditions for operations pursuant to Article 172 hereof, in particular
regarding the technical level of equipment, professional qualifications of the staff,
continuity of work and taking of special measures, shall be prescribed by the Director.

For entering of operations pursuant to Article 172 as the subject of activity in the
court register it is necessary to obtain the consent of the State Water Directorate
regarding the compliance with the conditions pursuant to para 1 above.

                         VI. NATIONAL WATER COUNCIL

Article 175.

The National Water Council is established tor the purpose of discussing of essential
issues of water management, coordination of various needs and interests, and
proposing of measures for the development and improvement of the water system in
the Republic of Croatia.

The National Water CounciI

1. discusses and expresses the opinion regarding draft Acts and other regulations
dealing with the subject of water management,

2. discusses the implementation of Acts and regulations on water management,

3. discusses the draft of the Water Management Master Plan of Croatia and water
management plans brought at the national level,

4. discusses the system of water management financing and the use of the provided
funds,
5. discusses the needs realized through the water system in various activities and
fields of life (community development, agriculture, power, navigation, industry,
tourism, etc.)

In relation to the issues discussed, the National Water Council espresses its opinions,
standpoints and suggestions, proposes regulations and measures.

Article 176.

The national Water Council consists of the Chairman and ten members appointed for
the period of four years by the House of Representatives of the Parliament of the
Republic of Croatia.

The Chairman and the members of the National Water Council are nominated from
among the representatives in the Parliament of the Republic of Croatia, eminent
scientists and professionals in the field of water management and related fields.

Article 177.

The National Water Council adopts its Rules of Procedure.

Technical and other operations required for the activity of the National Water Council
are performed by the State Water Directorate.

            VII. SUPERVISION AND ADMINISTRATIVE MEASURES

Article 178.

The administrative supervision over implementation of this Act and the subsidiary
regulations, as well as the administrative supervision over Croatian Waters regarding
performance of adminitrative tasks entrusted to it is exercised by the State Water
Directorate.

Should a County office in charge of water management conclude that some of the
operations and acts of Croatian Waters in relation to Article 21 of the State
Administration Act (Official Journal 75/93) are irregular or illegal such county office
shall report the matter to the State Water Directorate.

The State Water Directorate shall inform the office, that has submitted the report, on
the measures taken or the reasons why no action was taken, within one month from
the date of the receipt of the report.

Article 179.

Inspection over the implementation of the provisions of this Act and the subsidiary
regulations is carried out by the State Water Directorate (hereafter: State Water
Inspection Service) and the County offices in charge of water management (hereafter:
county water inspection service).
Water inspection may also be performed by other government officials authorized by
the Director.

Article 180.

The Water Inspection Service supervises in particular:

1. the condition of watercourses pursuant to Article 2 hereof,

2. technical condition and proper use of water works and plants,

3. the use of water and the water estate in accordance with this Act, water rights acts
and the concession agreements,

4. the status of water pollution and contamination and implementation of water
protection measures, and compliance with the conditions determined by the water
rights acts,

5. preparing and implementation of flood protection measures and other measures of
protection from adverse effects of water,

6. compliance with the law of the activities pursuant to Articles 158 and 172 hereof.

Article 181.

The State Water Inspection Service supervise the application of the provisions hereof
and other regulations, and implementation of measures in water management referring
to interstate commitments, works and the condition of the water system on interstate
and national waters and the coastal sea, preparing and implementation of the National
Flood Protection Plan, and the condition of the water works owned by the state,
preparing and implementation of the National Water Protection Plan, compliance with
the water rights acts pursuant to Article 123 para 2 and Article 131 para 2 hereof, and
the exercise of rights and responsibilities under the concession pursuant to Article 145
para 2 items 1 through 3 hereof.

The State Water Inspection Service may directly carry out operations from the scope
of a county water inspection, at the cost of the County concerned, if this is considered
the only way to implement the provisions of this Act and other regulations based
hereupon, when the authorized water inspection service has failed to carry out the
supervision in time, or has not completed the procedure by the specified time-limit.

Article 182.

The County water inspection service supervises the application of the provisions of
this Act of other regulations based on the Act, and of the decisions of county
assemblies or of the Assembly of the City of Zagreb or town and municipal councils,
and the application of measures in the field of water management in cases which
according to Article 181 do not belong under the competence of the State Water
Inspection Service.
If the competence of the State Water Inspection Service is determined, the water
inspection under para 1 above may by itself take the necessary measures in order to
prevent damage and immediately inform the State Water Inspection Service.

Article 183.

In carrying out the inspection, the water inspector shall have the right to ask the
authorized person in the legal or natural person where the inspection is carried out:

1. to allow inspection in the working premises,

2. to submit all required data and documents,

3. to report the measures taken to eliminate the defects,

4. to organize and allow water sampling for analysis,

5. to allow direct insight into the working process.

The costs of water sample analysis pursuant to para 1 item 4 above are covered from
the Government Budget, or from the budget of the County or the City of Zagreb, if the
contents of water do not correspond to the contents specified by the water rights
permit, the costs shall be covered by the legal entity or physical person in question.

Article 184.

If the water inspector finds any infringement of the provisions of this Act or of the
regulations based hereon, he shall state in writing all irregularities and defects and
order the measures and time for their correction.

In the case under para 1 above the water inspector shall have the authority:

1. to forbid construction or other works if they are carried out without the required
water rights acts or contrary to the provisions therein,

2. order temporary suspension of works or activities,

3. forbid the use of facilities of plants,

4. forbid or limit water use,

5. forbid or limit discharge of hazardous substances into water,

6. forbid disposal of waste and other substances in areas where this may cause
degradation of water quality,

7. order measures for treatment of polluted water,

8. order repair of damages and establishing of the original conditions,
9. order temporary confiscation of objects used in vidation of the provisions of this
Act, until final verdict,

10. take other measures and actions in accordance with this Act or regulations based
on the Act.

Article 185.

The water inspector shall advise the Sate Water Directorate to cancel the water rights
permit issued contrary to the provisions of this Act and to the regulations based on the
Act, and propose temporary or permanent withdrawal of the permit for reasons given
in Articles 140 and 141 hereof.

Article 186.

The water inspector may bring a verbal decision and immediately order its
implementation if it is necessary to stop an action which may cause direct danger to
human lives and health, fauna and flora, or result in major material damage, and in
particular:

1. in case of direct danger of flood, outflow or deterioration of a flood situation,

2. in case of the risk of water shortage or problems in water supply,

3. if there exists a water pollution hazard, or if the pollution has already taken place in
the extent which presents real danger to human lives and health or to flora and fauna.

The decision in writing shall be sent to the party within seven days from the date of
the verbal decision.

Article 187.

No complaint may be lodged against the fist-instance decision of the State Water
Directorate, brought under this Act.

Exceptionally, a complaint against the decision by the State Water Inspection Service
may be submitted to the State Water Directorate within eight days from the receipt of
the decision.

The complaint shall be considered by special commission of the State Water
Directorate, appointed by the Director.

The complaint against the cecision under para 2 shall not delay implementation.

Article 188.

The office of the water inspector may be performed by a person who, in addition to
legal requirements for government administration personnel, has the university degree
in civil engineering and five years of experience in water management, and has passed
the state licensing exam for water inspectors.
The office of water inspector in water protection may also be performed by a person
holding a university degree in chemical engineering, biochemistry, technology,
engineering ecology and geodesy, with five years of experience in water protection
and the exam for water inspector in water protection.

The curriculum of the state exam for water inspectors is determined by the Director.

Article 189.

The water inspectors shall have special identification cards proving their office and
identify.

The format of the records and of the identity card of the water inspectors shall be
defined by the Director.

Article 190.

In order to secure the implementation of the provisions of this Act and regulations
based on the act, the bodies of government administration in charge of sanitary
inspection may:

1. prohibit construction or the use of structures and plants, use of land or industrial
and other activities in sanitary protection zones of sources serving for drinking water
supply, or mineral water supply - if such activities present a hazard to sanitary
condition of water,

2. order correction of defects on the facilities and plants serving for drinking water
supply, if such defects may affect the quantity or sanitary condition of water,

3. forbid the use of drinking water that does not comply with the standards as regards
chemical, physical, bacteriological, biological and radioactivity properties,

4. order treatment, disinfection and other hygienic and epidemiological measures in
order to improve the sanitary condition of water,

5. order other measures required to improve the sanitary condition of water.

The government administration bodies in charge of sanitary inspection shall inform
the water inspection service about the measures taken pursuant to para 1 above.

Article 191.

The provisions of Articles 182 through 186 hereof are aplied, in a corresponding way,
also by the government administration bodies in charge of sanitary inspection, when
taking measures pursuant to Article 190 hereof.

Article 192.

Should a legal entity or physical person, in cases under Article 184 hereof, fail to
follow the directives given in the decision of the water inspector, such entity or person
shall be sanctioned by a penalty equivalent to ten-fold amount of average salary in the
Republic of Croatia in the past quarter. Each further penalty shall be equal to the
double amount of the previous.

The penalty under para 1 above shall be charged by administrative bodies in charge of
monetary penalties. The amount of the penalty shall be paid in favour of the budget of
the town or municipality where the seat of the legal entity is situated, or where the
person in question is carrying out the activity.

Article 193.

Direct supervision over the condition of waters and water works for the purpose of
prevention, registerring and removal of water pollution and damages on the water
works shall be performed by water watchmen.

Performing their duties under para 1 above the water watchmen shall be authorised to
check the persons' identify and to report any offence.

The water watchmen shall have the watchman's identity card.

The conditions of performing the watchman's duty and the format and contents of the
watchman's identity card shall be defined by regulations issued by the Director.

                                  VIII. PENALTIES

Article 194.

The penalty in the amount from 40,0000 to 500,000 Croatian Kunas shall be
administered to the legal entity or person:

1. which, in carrying out water supply activity does not provide constant and
systematic water analysis, does not take the measures to ensure water quality and
sanitary condition of the plants (Article 35),

2. which does not take the mandatory measures of sanitary protection of the sources
(Article 40),

3. which excavates sand, gravel and rock, without water rights permit, in the area
where such permit is required, or which excavates these substances in quantities
exceeding the approved limits (Article 53),

4. which uses the water estate without authorisation (Article 64),

5. which does not allow the use of the water estate for purposes pursuant to Article 59
hereof (Article 62),

6. which discharges into water hazardous or other substances or deposits them in the
areas where there is a risk of water pollution or contamination, contrary to the
provisions hereof (Article 70 para 2),
7. which does not carry out tratment of technological waste water (Article 72 para 1
item 1),

8. which does not remove hazardous substances (Article 73),

9. which discharges water from the local disposal system above the allowed limit
values (Article 72 para 1 item 2),

10. which fails to eliminate the defects on waste water disposal plants, which results
in ground water pollution (Article 74 para 2),

11. which does not discharge waste water in accordane with the decision on waste
water disposal (Article 75 para 1),

12. which does not implement the measures determined by the water protection plan
(Article 76),

13. which fails to respect the prohibition or limitation of waste water discharge, or
other prescribed measures during low discharges (Article 78),

14. which fails to notify the police about water pollution or contamination, or on the
risk thereof in connection with activity or error of such entity or person (Article 79
para 1),

15. which performs water quality analysis without licence (Article 81),

16. which does not implement measures determined by the flood protection plan or
ice protection plan (Article 87),

17. fails to keep or update the water-related documentation (Article 103 para 3, and
Article 115 para 5),

18. which carries out, without water rights approval, construction and other works for
which such approval is required, or carries out such works in discord with the
approval (Article 126 para 1),

19. which performs, without water rights approval, any activity for which such
approval is required, or performs such activity in discord with the approval, or which
produces and puts into traffic chemical substances and derivatives thereof without
water rights permit (Articles 129 and 130)

20. which carries out, without concession agreement, any activity or works for which
concession agreement is mandatory (Article 143),

21. which, as a concessionaire, fails to take the necessary measures to protect human
lives and health and property of other persons (Article 151),

22. which, as a concessionaire, fails to take the actions ordered to comply with the
changes of the water regime (Article 152 para 1),
23. which performs the activities under Article 172 hereof without entry in the court
register (Article 174).

For the offence pursuant to para 1 above, the responsible person in the legal entity
shall be fined by a penalty in the amount from 4,000 to 50,000 Croatian kunas.

Article 195.

The penalty in the amount from 20,000 to 100,000 Croatian kunas shall be paid by the
legal entity or physical person:

1. which uses water, without water rights permit, for purposes and in the quantities
exceeding the extent of general water use (Articles 27 and 28),

2. which uses water contrary to the decision on temporary limitation or permanent
suspension of water use (Article 29),

3. which fails to report within 48 hours the discovery of ground water during mining
operations, other excavation and drilling (Article 30 para 1),

4. which does not allow insight, taking of data and investigations of ground water
(Article 3 para 2),

5. which is carrying out the water supply activity does not submit the data on
measures taken for the purpose of providing adequate water quality (Article 35),

6. which discharges waste water into sumps and collector pools contrary to the
regulations on limit values of hazardous and other substances (Article 72. para 1 item
3),

7. which does not keep regular records of the discharge of hazardous and harmful
substances into water (Article 80),

8. which does not participate in flood protection when compelled to do so by the flood
protection plan (Article 89),

9. which disrespects temporary limitation or suspension of road, railway or river
traffic (Article 90 para 1),

10. which, as user of storage reservoir fails to take measures for receiving of the flood
wave (Article 91 para 1),

11. which fails to take the ice protection measures (Article 92 para 2),

12. which does not maintain the detailed drainage network as required by the decision
of the County assembly (Article 103),

13. which acts contrary to prohibitions declared for the purpose of preservation and
maintenance of regulation and protective water works, and for prevention of
deterioration of the water regime (Article 106 para 1 items 1, 2, 4, 5 and 6),
14. which constructs building and carries out other works in the areas where such
activities are forbidden (Article 106 para 1 item 3),

15. which does not maintain the roads and passes on the water estate, regulation and
protection water works in the adequate way, or uses them in spite of the prohibition
(Article 108 para 1),

16. which does not allow the use of sand, gravel or rock, or does not allow passing
through the land for the purpose of implementation of flood protection measures
(Article 109 para 1 and 2),

17. which does not allow passing over the land for the purpose of maintenance of
water works (Article 110 para 1),

18. which changes or interrupts the ground water flow, or uses water in the extent that
affects other persons' rights, mineral and thermal sources, stability of soil and
structures (Article 111 para 1 item 1),

19. which changes the direction on intensity of surface water running through or from
his land (Article 111 para 1 item 2),

20. which does not provide assistance to implementation of administrative inspection
in accordance with Article 183 hereof.

For the offence under para 1 of this Article the responsible person in the legal entity
shall also be fined by a penalty of 2,000 to 10,000 Croatian kunas.

Article 196.

The penalty of 10,000 to 50,000 Croatian kunas shall be paid by the legal entity or
physical person:

1. which does not comply with the decisions of the town or municipal council
regarding the use of water from public wells, pumps and similar facilities which are
not included in the system of organized municipal services (Article 37),

2. which does not keep regular records of water intake and use (Article 39 para 1),

3. which does not keep regular records of excavated sand, gravel or rock (Article 54),

4. which uses the water estate for recreation purposes contrary to the decision of the
town or municipal council (Article 63),

5. which fails to establish the original condition (Article 107).

The responsible person in the legal entity shall also be fined for the offence under
para 1 above by a penalty of 1,000 to 5,000 kunas.

Article 197.
The penalty in the amount from 2,000 to 10,000 kunas shall be paid by the legal entity
or physical person:

1. which does not submit the data from the records on water quantities taken and used
(Article 39 para 1),

2. which does not submit the data from the records of the quantity and quality of
excavated sand, gravel or rock (Article 54),

3. which does not submit the data from the records on the discharge of hazardous and
harmful substances (Article 80).

For the offence under para 1 above, the responsible person in the legal entity shall
also be fined by a penalty of 500 to 5,000 kunas.

Article 198.

The penalties pursuant to Article 137 and penalties for offences pursuant to Articles
194 through 197 hereof shall be paid in favour of the county budget and shall be used
for the specific purpose of financing of watercourse regulation works in the catchment
area where the offence was committed.

Article 199.

In addition to the penalty for the offence under Article 194 para 1 item 3 hereof,
protective measures may also be taken such as confiscating of the vehicle, equipment
or tools used as means of the offence.

The protective measure under para 1 above may be taken for a period up to six
months, and if the offence is repeated within two years, the working means may be
permanently confiscated without any compensation.

                   IX. TRANSITION AND FINAL PROVISIONS


1. IMPLEMENTATION OF STATUS CHANGES IN PUBLIC WATER
MANAGEMENT ENTERPRISES AND BEGINNING
OF OPERATION OF CROATIAN WATERS

Article 200.

Croatian Waters is the legal successor of Javno vodoprivredno poduzece (Public
Water Management Enterprise) "Hrvatska vodoprivreda".

Croatian Waters shall be organized and start operation, in accordance with the
provisions hereof, by 1st July, 1996.

The operation of JVP "Hrvatska vodoprivreda" shall cease the day Croatian Waters
are registered in the Court register, and the property, rights and duties of "Hrvatska
vodoprivreda" shall become the property, rights and duties of Croatian Waters. The
same day, the employees of JVP "Hrvatska vodoprivreda" shall become the
employees of Croatian Waters.

Article 201.

Croatian Waters shall pass its Statute within 30 days from the date of registration.

Until the appointment of the Manager of Croatian Waters the duties of the legal
representative of the legal entity shall be performed by the Manager of JVP "Hrvatska
vodoprivreda".

Until constituting of the Management Council of Croatian Waters, the authority of
this body shall be exercised by the Management Board of JVP "Hrvatska
vodoprivreda".

Article 202.

The proprietary and founder's rights over public water management enterprises of
catchment areas shall be transferred to the respective counties or to the City of
Zagreb, where the seats of such enterprises are situated, the day of entering into force
of this Act.

The enterprises subject to para 1 above shall be organized as commercial companies
and adjust their operation to the provisions of this Act by 1st July, 1996.

By exception from para 2 above, the public water management enterprise of the
catchment area of Zadar, Zadar, the public water management enterprise of the Krka
catchment area, Sibenik, and the public water management enterprise of the
catchment area of Dubrovnik shall cease operation on July 1, 1996, and OOUR
"Krka", Knin shall cease operation the day of entering into force of this Act. The
property, rights and responsibilities of these legal entities shall be transfered to
Croatian Waters which shall also take over the personnel of the public enterprises.

Article 203.

The legal entities under Article 202 para 2 hereof shall, before reorganization into
commercial companies:

1. hand over to the management of Croatian Waters the real estate which is, pursuant
to this Act, the property of the government, counties or of the City of Zagreb
(protection and regulation water works, watch-houses, ameliorative water works,
etc.),

2. Separate from their property to be transferred to Croatian Waters a corresponding
part of the real estate (office buildings and premises with corresponding land estate)
used on the day of entering into force of this Act for carrying out the operations
pursuant to Article 158 hereof and exercising of public powers which are at present
performed by catchment area water management enterprises and which by this Act
become the responsibility of Croatian Waters.
3. transfer to Croatian Waters the unspent funds of water rights charge and the
corresponding claims and liabilities to be covered from the charge.

4. hand over to Croatian Waters the water records, water registers, technical and other
documentation on management of water and of amelioration systems.

Article 204.

In order to determine the assets, rights, responsibilities and documentation (hereafter:
the property) which in accordance with Article 203 hereof is to be transferred to
Croatian Waters, a special commission shall be established for each of the catchment
area water management enterprises.

The commission pursuant to para 1 of this Article shall be established by agreement
between JVP "Hrvatska vodorpivreda" and the particular public water management
enterprise of the catchment area.

The commission shall make the protocol on the inventory of property, and the
agreement on transfer shall be based thereupon. Before signing the draft agreement
shall be submitted to the Director for approval.

Should the parties fail to reach agreement as stipulated by para 3 above, the decision
shall be made by the arbitration committee. The arbitration committee shall consists
of five members, out of which two members shall be appointed by each of the public
water management enterprises (JVPs) and the chairman shall be appointed by the
Director.

The agreement pursuant to para 3 and the decision of arbitration pursuant to para 4
above shall have the validity of the public document fit to be entered into land
register.

Article 205.

Croatian Waters shall take over the personnel of the legal entities subject to Article
202 hereof, required for performing of operations and tasks pursuant to Article 158
hereof, which are at present carried out by public water management enterprises of
catchment areas and which by this Act shall become the responsibility of Croatian
Waters.

Taking over of the personnel shall be done on the basis of the agreement between
"Hrvatska vodoprivreda" and the particular public water management enterprise of the
catchment area.

Should the parties fail to reach agreement on taking over of the personnel as provided
by para 1 above, the take-over shall be accomplished on the basis of the decree by the
Director. Such decree shall be final.


2. PRIVATIZATION OF COMMERCIAL COMPANIES PERFORMING
WATER MANAGEMENT
Article 206.

The commercial companies pursuant to Article 202 para 2 hereof and limited liability
companies owned by "Hrvatska vodoprivreda" (hereafter: the commercial companies)
shall be subject to privatization.

Privatization pursuant to para 1 above shall include at least 51 percent of the company
capital.

The decision on privatization shall be subject to prior opinion of the State Water
Directorate.

Privatization of commercial companies pursuant to this Article shall be subject to the
provisions of the Privatization Act.


3. OTHER TRANSITION AND FINAL PROVISIONS

Article 207.

Within one year from entering into force of this Act, the public attorney shall submit
the requirement to enter the real estate subject to Article 60 hereof into the land
register as the public water estate in the ownership of the Republic of Croatia.

By exception, the provision of para 1 above shall not apply to land units under Article
58 which were, by nationalization, confiscation or on some other basis except by
action of former owners, transformed into social property, until the legal status is
solved by a separate law.

Article 208.

Water rights terms, water rights approvals and water rights permits issued subject to
regulations that were in force before this Act entered into force shall have the legal
validity of water rights acts subject to this Act.

Article 209.

Legal entities and physical persons, users of water or water estate under Article 143
hereof, for whose activities the concession is required according to this Act, and
which meet the prescribed conditions, will be awarded the concession without public
competition.

Entities and persons under para 1 above shall, within one year from entering into
force of this Act, submit the application for the concession. If they fail to do so during
the period, their right to use water or the water estate shall cease.

Article 210.
Pending water master plans or water management plans in areas where such
documents have not been issued, water rights acts may be issued on the basis of the
existing documentation.

Article 211.

Licences issued to laboratories in accordance with the Regulations on Licenced
Laboratories (Official Journal No 40/91) shall cease being valid by expiration of three
months from the day of entering into force of the regulation pursuant to Article 81
para 2 hereof.

Article 212.

By way of exception from the provision of Article 188 hereof the office of the county
water inspector or the water inspector of the City of Zagreb may be performed by
persons who were appointed water inspectors before this Act entered into force and
who have an associate degree in civil engineering.

Article 213.

The regulations subject to Article 27 para 2, Article 32 para 2, Article 37, Article 41
para 1, Article 42 para 1, Article 75 para 3, Article 98 para 2, Article 100, and Article
103 para 2 shall be considered the regulations belonging to the scope of local
administrative units issuing such regulations.

Article 214.

The Parliament of the Republic of Croatia shall issue, within five years from entering
into force of this Act, the Water Management Master Plan of the Republic of Croatia,
subject to Article 20 para 2 hereof.

The Government of the Republic of Croatia shall issue:

1. within one month from entering into force of this Act, the regulations subject to
Article 15 para 3, Article 16 para 3, Article 17 para 2, and Article 155 hereof.

2. within six months from entering into force of this Act, the regulations subject to
Article 70 para 3, Article 71 para 4, and the documents subject to Article 77 para 1
and Article 87 para 1 hereof.

The State Water Directorate shall within one year from entering into force of this Act
issue the legal documents pursuant to Article 8.5 para 4 hereof.

The Minister of Public Health shall, within six months from entering into force of this
Act, issue the regulation subject to Article 35 para 2 hereof.

The Director shall, in agreement with the minister in charge of maritime affairs,
within six months from entering into force of this Act, define the demarcation lines
between coastal and maritime waters pursuant to Article 2 para 2 hereof.
The Director shall issue:

1. within one month from entering into force of this Act, the regulations pursuant to
Article 118, Article 121, and Article 174 para 1 hereof,

2. within six months from entering into force of this Act, the regulations pursuant to
Article 23, Article 39, para 2, Article 43, Article 54 para 2, Article 72, Article 80 para
2, Article 81 para 2, Article 105, Article 188 para 3, Article 189 and Article 193
hereof.

The county assembly or the Assembly of the City of Zagreb shall issue:

1. within six months from entering into force of this Act, the regulations pursuant to
Article 72, Article 75para 2, and Article 103 para 2 hereof,

2. within one year from entering into force of this Act, the documents pursuant to
Article 77 para 2, Article 85 para 4, and Article 87 para 2 hereof,

3. within two years from entering into force of this Act, the documents pursuant to
Article 22 para 2 and Article 41 paras 1 and 2 hereof.

The municipal or town councils, or the Council of the City of Zagreb shall, within one
year from entering into force of this Act, issue the regulations pursuant to Article 37,
Article 41 para 2, Article 63 para 1, Article 75 para 2, and Article 103 para 2 hereof.

Croatian Waters shall, in agreement with the Director, within six months from
entering into force of this Act, issue the documents pursuant to Article 55 para 1, and
Article 107 para 3 hereof.

Article 215.

The following documents shall remain in force until issuing of the regulations
pursuant to Article 214 hereof

1. Ordinance on categorization of watercourses (Official Journal No 15/81),

2. Ordinance on water classification (Official Journal No 15/81),

3. Ordinance on maximum allowed concentrations of hazardous substances in water
and coastal sea (Official Journal No 2/84),

4. Decision on determining of the areas of water basins (Official Journal No 33/67),

5. Decision on determining of catchment areas in the Republic of Croatia (Official
Journal No 23/91),

6. Regulations on conditions to be met by laboratories performing water quality
analysis (Official Journal No 40/91),
7. Regulation on the format and manner of keeping water - related documentation and
abstracts from water records (Official Journal No 17/78),

8. Regulations on issuing water rights terms, water rights approvals and water rights
permits (Official Journal No 6/92),

9. Plan of Water Protection from Pollution (Official Journal No 22/86),

10. Flood Protection Plan (Official Journal No 13/92),

11. Directions on keeping records on inspection surveys in water management
(Official Journal No 3/89),

12. Directions for the keeping of records of the frequency of discharging into water of
hazardous and harmful substances and the method of supplying the data to public
water management enterprises (Official Journal No 9/90).

Article 216.

The following acts shall become void the day of entering into force of this Act:

1. The Water Act (Official Journal No 53/90, 9/91, 51/91, 26/93, 43/93, and 95/94),
except the provisions of Articles 103 through 114, Article 115 para 1, Articles 116
through 120 which shall become void on 30th June, 1996, and Chapter V which shall
become void by the date determined by the law regulating the financing of water
management (Articles 121 through 143),

2. Article 8 of the Act regulating the scope of local administrative units (Official
Journal No 75/93)

3. The Act on taking over of the Act on the Basis of the Regime of Waters Important
to One or More Republics or Autonomous Provinces, and on Interstate Waters, which
is applied in the Republic of Croatia as a state law (Official Journal No 53/91).

4. Provisions of the Act on Maritime and Water Estate, Ports and Harbours (Official
Journal No 19/74, 39/75, 17/77 and 8/81) in the part referring to the water estate.

Article 217.

Until the beginning of operation of Croatian Waters, all responsibilities and
authorities included under this Act into the scope of Croatian Waters shall be
performed by JVP "Hrvatska vodoprivreda".

The authorities and responsibilities of Croatian Waters determined by this Act, which
according to the Water Act (Official Journal No 3/90, 9/91, 61/91, 26/93, 43/93, and
95/94) are to be performed by the public water management enterprises of catchment
areas, shall be performed by these enterprises until 30th June, 1996.

Article 218.
For the purpose of timely enforcement of Articles 203, 204 and 205 hereof, the
Management Board of "Hrvatske vodoprivreda" shall, at the proposal by the Manager
and with the consent of the Director, issue the temporary document on internal
organization of Croatian Waters, by 31 March, 1996.

Article 219.

This Act shall enter into force on the eight day from its publication in Official Journal,
and shall apply from 1 January 1996.

Class: 325-01/94-01/12

Zagreb, 13 December, 1995

                         HOUSE OF REPRESENTATIVES
                       PARLIAMENT OF THE REPUBLIC OF
                                 CROATIA

                                      Chairman
                   of the House of Representatives of the Parliament

Vlatko Pavletić, Academician

				
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