Risk of Overlapping Regulations in New Construction Materials Bill

The Construction Materials (Management and Regulation) Bill, currently under discussion in Parliament, has raised concerns about potential duplication of laws. 

The bill grants local authorities the power to collect royalties from extraction of riverbed materials. They can also recommend to the provincial government the closure of extraction-related activities if they pose significant environmental damage and pollution.

Local authorities can also issue instructions for the improvement of those involved in extracting riverbed materials and operating crusher plants.

The bill assigns the responsibility of crusher registration to the provincial ministry of industry. Failure to register or renew crusher plants may result in fines ranging from Rs 1 million to Rs 2.5 million.

Despite the division of rights among central, provincial, and local levels, their ever existing lack of coordination could result in conflicting regulations, as each level may try to create rules in its own favour, stakeholders claimed.

Section 9(4) of the proposed bill permits local governments to make laws regarding the collection or sale of riverbed materials.

Stakeholders recommend the federal government manage the issue in coordination with provincial and local authorities to avoid overlap, proposing reforms to Section 9(4). They have suggested that provincial and local governments should ensure they create a business-friendly environment while issuing separate laws and circulars to avoid the duplication.

Rabi Singh, president of the Federation of Contractors' Associations of Nepal, said that the contractors would prefer a unified law as different laws and procedures at different levels would make it more difficult to operate their businesses. 

Minerals and everything related to them have been included in the list of common rights at the federal, provincial, and local levels.

In addition, the bill mandates that environmental assessments, including geological studies and surveys, be conducted before any material excavation for construction. It proposes strict prohibition in excavation in areas such as Chure, national parks, wildlife reserves, watershed areas, and botanical gardens.  

However, the bill has a provision allowing extraction of construction materials from such areas if the government allows it for disaster risk reduction. 

The bill also calls for a collaborative system among local levels to manage and monitor construction materials from rivers that span more than two local areas.

To protect infrastructure such as bridges and roads near the site of extraction , the bill forbids excavation of riverbed construction materials within one kilometre downstream and 500 metres upstream of any man-made structures. It has also proposed that no materials shall be excavated during the three months of the rainy season.

However, the Federation of Nepal Crushers and Mining Industry Entrepreneurs (FNCMIE) claimed that the proposed arrangements were impractical. 

Sitaram Neupane, the federation’s president, said authorities should allow the collection of riverbed materials brought by the rivers during the rainy season.

“Crusher operators should not be prevented from such activities," Neupane said. 

The bill proposes that plants currently extracting riverbed materials need to conduct environmental impact assessment and relocate if they fail to comply with the bill's provisions. Else, their registration will be cancelled and the properties seized by the district administration office.

Other proposals include that the construction materials produced with permission from one local level or province should not be subject to additional taxes or duties during their transportation to other local levels or provinces.

Some local levels have imposed extra fees in the past.

Section 28 of the bill talks about the establishment of a Central Coordination and Facilitation Committee for formulation of policies in the federal, province, and local levels regarding mining, collection, processing, or sale and distribution of construction materials.

However, the bill has not proposed to include representatives of the concerned private sectors as the members in the committee.