On August 9, 2025, Law No. 21,759 was published in the Official Gazette, which amended the Water Code to facilitate the construction of dams for agricultural use.

According to the previous text of Article 294 of the CA, the construction of certain works, among which are reservoirs with a capacity exceeding 50,000 cubic meters or whose wall is more than 5 meters high, shall require the approval of the Director General of Water.

Article 295 of the CA establishes that the DGA will grant the authorization once the definitive project has been approved and provided that it has been verified that the work will not affect the safety of third parties or cause water pollution, and indicates that a special regulation will establish the technical conditions to be met by the project, construction and operation of the works.

Article 10(a) of Law No. 19,300 on General Bases of the Environment provides that "aqueducts, reservoirs or dams and siphons that must be subject to the authorization established in Article 294 of the Water Code (...)" must be submitted to the Environmental Impact Assessment System ("SEIA").

Thus, under the previous text of the CA, for the construction of dams with a capacity greater than 50,000 cubic meters or whose wall is more than 5 meters high, it was required to obtain authorization from the DGA and go through the SEIA, requirements that delay the construction of the works and entail associated financial costs.

Law No. 21,759 amends Article 294 of the CA, establishing that as of its entry into force the following will require the approval of the Director General of Water: (i) reservoirs that are built in a natural waterway whose capacity exceeds 50,000 cubic meters or whose wall is more than 5 meters high and (ii) reservoirs that are built outside a natural waterway whose capacity exceeds 150,000 cubic meters or whose wall is more than 7 meters high.

In other words, in the case of dams built outside a natural watercourse, the capacity and height of the walls of those that may be built without requiring authorization from the DGA or an environmental impact assessment is increased to 150,000 cubic meters or walls over 7 meters high.

The law also adds a new final clause, according to which the owner or administrator of a work that is outside the watercourse, with a capacity greater than 50,000 cubic meters or whose wall is more than 5 meters high and that does not require the approval of the DGA, prior to the construction of the reservoir or dam, must communicate the information required in the aforementioned clause by means of a sworn statement to the DGA and once the work is completed (within 6 months) must send it a copy of the final projects for inclusion in the Public Water Cadastre. Failure to comply with this obligation will be sanctioned with a fine.

Validity:

The amendment introduced by Law No. 21,759 will enter into force on March 2, 2026 and within this period the regulations referred to in Article 295 of the CA must have been updated.

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