Water rights confirmation and trade, a way to integrate property rights concept into water management, have been applied in many countries, basins, and regions around the world. Water rights belong to usufructuary right, which is the exclusive right of the right holder, including the right of ownership, usufruct, and transfer [1
]. Water rights can be regarded as the mutually recognized behavior and interest connection of people in the process of water resources development, governance, protection, utilization, and management, which essentially reflects the rights and obligations relationship among water-related stakeholders [2
]. Water rights and water market are important means to improve the efficiency and benefit of water resources utilization, which have become highly prevalent in the field of global water management [3
]. For example, Australia has applied major reforms to its water sector for more than 15 years involving the adoption of “water rights”—with water users granted better defined, more secure, and often tradable entitlements to water [4
]. Many studies have indicated the importance of water rights institution to water conservation, water use efficiency and farmers’ irrigation decisions [5
]. Generally, a typical water rights institution includes two phases: water rights confirmation and registration, and operation and management of water markets. Water rights confirmation and registration are foundations of water rights institution. Rights confirmation refers to the verification and recognition of the agent and content of the right by the administrative department. Rights registration is the process of registering authority records and publicizing relevant matters following the law. There is a great need to establish appropriate initial water rights distribution methodologies and associated management institutions and policies to achieve equitable water allocation, in an efficient and environmentally sustainable manner, subject to hydrologic and other constraints [8
China’s traditional water rights management is a multilevel control system of water abstraction management with administrative permission as the core. The authority of the central government also plays roles in controlling and allocating overall regional water abstraction rights. Water resources allocation is occurring across China, which has developed a legal framework that operates at the river basin/regional level, the water abstraction level, and within public water supply systems [9
]. The irrigation district in the arid region with the most detailed management level can be used here as an example. Water rights management of irrigation districts is mainly manifested at three levels. The first level is to control the total amount of regional irrigation water abstraction, which is the upper limit of the regional irrigation water use by both basins and administrative divisions. The ownership of water resources belongs to the state and is entrusted to the central government, which adopts the policy of “dual control” of total volume and efficiency to implement water resource allocation to provinces. The quota is then allocated from provinces to prefectures and finally to counties under jurisdiction of each tier. The allocated quota for each administrative division is then distributed into basins within its administrative boundary, so the total amount of permissive abstraction can also be defined. The second level is the water abstraction rights of irrigation districts or farms. The total amount of water resource is controlled regionally, which is gradually distributed to irrigated districts and other water abstraction agents. According to the Regulations on Administration of Water Abstraction Licensing and Collection of Water Resources Fee
] (hereinafter referred to as Regulations
), water abstraction rights is the right obtained by different levels of irrigation agents after paying the water resource fee and applying for the water abstraction permit from the water administrative department or the river basin management agency. The third level is the water use rights within the irrigated district, including the village, the water users’ association (the WUA), farmers, and other water users. Water is allocated proportionally based on the irrigation area, irrigation quota, and other factors. According to historical documents, some unique rudiments of irrigation water rights have been developed in some areas of north China that lack water resources, such as the water rotation system of Heihe River Basin, the water ticket of Zhangye, etc. In some areas, water rights trading within the agricultural sector use water tickets as a form of trading, such as Minle County in Gansu Province and Huquanbi County in Xinjiang Province. Such trading is based on the fact that farmers have obtained an explicit water rights certificate (informal) and have purchased a water ticket from the irrigated district following their annual allocation of water.
In recent years, the market mechanism has gradually been adopted as supplementary to resource allocation, which has been become important to Chinese decision-makers. The unique political institution of China makes it possible for dual water governance, with the adoption of both market principles and government regulations to improve water allocation [11
]. Since its introduction into the water sector (officially) in 1998 by the Minister of Water Resources (MWR), a water rights institution and associated framework have been gradually formulated in China, which provide measures for market functioning at water allocation. [12
]. For water rights confirmation, the current research mainly focuses on the initial distribution method of water rights. Much research has applied a considerable amount of initial water rights distribution methods in the pursuit of a more scientific and effective scheme. Various methods of water rights distribution have been used in China, including the analytic hierarchy process, fuzzy method, and harmonious allocation method, among others [13
]. In practice, further downward subdivision is not commonly observed in nonpilot areas. To achieve the transition of water resources allocation from the traditional administrative management to the water rights institution with a property right nature, there are still three problems in the whole process of water right confirmation that need to be discussed:
The first problem is how to set the principle of initial water rights confirmation. Wang thought that the initial allocation of water rights is determined by the principles of prioritizing the basic water demands, promoting fairness, complying with the status quo, and improving economic efficiency [15
]. The critical problem is how to balance efficiency and equity. Water resource efficiency is a key evaluation indicator for decision-makers, while equitable distribution is critical for the water users at the grassroots level. The allocation systems performed the worst in equity, efficiency, and enforceability in river basins with relatively low resource density and high levels of exploitation, which may be contributed to severe water conflicts in arid areas [16
]. It is of great urgency to evaluate water rights distribution fairness and find a plan to balance the interests of all parties, especially the village and water user levels. Much literature has examined the fairness of water rights distribution. Zachary proposed a water rights distribution mechanism based on equitable apportionment that is able to achieve a fairer apportionment of drought impacts among individual water users [17
]. Guan used the Gini coefficient method to construct a water rights allocation model among farmer households based on the principle of fairness [18
The second problem is how to connect the water rights institution and the existing administrative management institution. The new method of distributing water rights needs to be linked to water abstraction permits primarily, with the verification and acceptance of existing results. It is found that the water rights institution must be established based on the existing water abstraction permit institution from the authority of the distribution results, which aims at protecting the legal rights of existing water users and complying with the legitimate part of history. The water rights system cannot be distanced from China’s existing rules, namely the “Three Red Lines” in terms of the total amount. The “Three Red Lines” is the water resources management system formulated by The State Council, which evaluates total water use, efficiency, and pollution discharge. One “line” refers to the upper limits on water use at the national, provincial, and municipal levels in China. The total water control quo of 700 billion cubic meters in 2030 has been allocated to each province. This is the initial water rights allocation at the national level. “Three Red Lines” has not been comprehensively considered in current models of initial water rights allocation [19
The third problem is how water resources management mode will change after water rights confirmation and registration. These changes include the variations in institutional mechanism, the role and responsibility of the government, and the rights of water users. It is found that water users and water administrative departments have low cognition and recognition of water rights in practice. The relationship between the certificate of water rights and the water abstraction permit is unclear, where the role of water rights cannot be fully played in the actual water resources management process. If the water rights confirmation only focuses on distribution rather than rights registration, it will make water rights indistinguishable from the traditional form of administrative management. Wang believes that China’s regional water rights transactions can be seen as intergovernmental agreements rather than water rights [20
]. This also reflects that the rights attribute of water rights is much lower than that of water quantity in administrative management in China. The water rights can truly operate when the changes between the old and new institutions are recognized.
To answer the three questions above, we would like to present the process, result, experience, and problems of the authors’ involvement in water rights confirmation and registration in Delingha city, as the methods designer of water rights confirmation. The rest of this study is organized as follows: Section 2
briefly introduces the study area, and describes how the principle, framework, and indicators of water rights confirmation are determined. Section 3
describes the results and experience of water rights confirmation and registration. Section 4
discusses the problems that emerged after the institutional change, such as institutional logic, the government’s role, and the relationship between old and new institutions. Section 5
presents conclusions based on the three questions presented above.
2. Materials and Methods
2.1. Study Area
Delingha city is the capital of Haixi Prefecture in Qinghai Province, which has been chosen as a pilot area for water rights reform in Qinghai province. Delingha is an arid area with an average annual precipitation of 177.5 mm. The Bayin River Basin in Delingha city is within a fragile ecological environment area. The main reason for the ecological problems there are the excessive exploitation and utilization of water resources, in which agricultural water consumption accounts for the largest proportion. During a field survey of water use in Delingha, we found that some farms and water users received water in a large scale without abstraction permits. It is necessary to standardize, safeguard, and restrict the rights of water users by using water right confirmation for the chaotic water use situation in Delingha city, especially to make agricultural water rights clear to each user.
The water rights confirmation covers the whole administrative region of Delingha city. The main river basins in Delingha city are the Bayin River and Balegeng River basins. Water sources include surface water and groundwater, providing resources for urban and life, industry, farmland, forest and grass irrigation, and ecological environment. The total amount of water resources in Delingha city is 505 million m3. As the northern mountainous (Hala Lake basin) and the southern mountainous areas are uninhabited and water resources are rarely used, only the water rights for the basin area outside these two areas are confirmed. Therefore, apart from the two uninhabited areas, the amount of groundwater in Delingha city is 326 million m3, the surface water is 410 million m3, the overlap part is 251 million m3, and the total amount of water resources is 485 million m3.
2.2. The Principle of Water Rights Confirmation
The principle of water right confirmation is to ensure equity. Historical rules need to be complied, in other words, to recognize and protect the existing water rights of legal users. The achievements of the water abstraction permit institution and the legal customary use of water should be observed to reasonably guarantee the inherent right of water users. Under the premise that the water market has not been established, to establish a totally new system without considering historical facts may cause an imbalance in the distribution of existing productivity, bring chaos to industrial and agricultural production, and cause unnecessary confusion, panic, and new disputes for existing water users. However, fair and reasonable distribution of water rights may be missing in the future if only considering the historical rules. The water rights confirmation is also the correction of unfair water distribution in the past. It is necessary to give priority to the legitimate parts of the existing system. Selecting high-authoritative indicators to adjust the unreasonable and unfair parts is important to ensure the public’s acceptance and scientific distribution.
2.3. The Framework of Water Rights Confirmation
The framework of water rights confirmation is shown in Figure 1
. There are five levels of water rights confirmation: the first level considers regional water rights, the second level are sector water rights, the third level are water abstraction rights, and the fourth and fifth levels are water use rights.
The first level refers to the dual control of “matching water use and the Three Red Lines” and “matching water consumption and available water resources”. To meet the dual requirements of administrative management and ecological protection, water consumption and water abstraction should be used together to control the total amount of water rights. Water rights confirmation based on water abstraction corresponds to the administrative management of water abstraction permits and the “Three Red Lines”, which is convenient for matching the management and implementation. However, exclusive consideration of water abstraction may cause out-of-control water loss, which is not conducive to guarantee the ecological flow of the basin. From the perspective of ecological sustainability of water resources, it is necessary to consider water rights confirmation based on water consumption as well. Therefore, the availability of water resources should be considered. It refers to the maximum amount of water that can be used as part of the total water resources of a basin in a foreseeable period by taking economically reasonable and technically feasible measures, based on the overall consideration of water use for life, production, and ecological environment, which is of high significance to ensure a stable water supply [21
The second level is the division of water rights among different sectors. Since water management is ultimately the responsibility of different administrative departments of water use sectors, the division of water rights by sector is more appropriate than that by administrative area. According to the status quo of water abstraction permit management and the division of labor in the management departments of Delingha city, we consolidated the water use sector into four categories, including domestic, agricultural, industrial, and artificial ecological water rights. Domestic water rights include residential and the public water use parts (service industry use). Agricultural water rights are divided into irrigated districts and forestry. Industry includes all industrial enterprises that have water abstraction permits. Artificial ecology refers to the part for artificial river and lake replenishment. The remaining water use sectors are reserved for future water rights. The third level refers to further subdivision of the second level to the nonagricultural agent, who has the legal right to intake water in irrigation areas, including urban domestic water supply departments, the enterprise with their own water source; industrial enterprises; and the agricultural irrigation areas with water access permits. The fourth level includes agricultural and public network users. The distribution of agricultural water rights is subdivided to the third level of agricultural water rights to each village or the WUAs in the irrigated area with mature conditions (complete supporting facilities and measuring facilities). Public network users are divided into life, industry, construction, greening, and so on. The fifth level is based on the irrigation water rights of the fourth level. Combined with the confirmation of irrigation area rights for Delingha city, the irrigation water rights are implemented for farmers, providing the basis for the end-users to issue the water rights certificate.
Water rights confirmation follows the hierarchical control of combining “top–down” and “bottom–up”. “Top–down” refers to the initial water rights distribution that conforms to a hierarchical system of administrative management in China. The water rights are controlled from the first level to the fifth level. The top to bottom types of water rights are regional water rights, water abstraction rights, and water use rights. The “bottom–up”, that is, rights confirmation mainly started from the users’ level, and the upper-level water rights holder can be the right agent of their subordinate water rights holder. In the process of total water rights statistics, the last level of water rights in each industry should be firstly confirmed, which will then be summarized upward, step by step. To confirm water rights with authority and acceptability, China’s water abstraction permit management should be combined integrally. Therefore, water abstraction rights confirmation in the third level is the crucial link for the multilevel framework, mainly involving the verification of water withdrawal permits, irrigation area verification, water use statistics, and other works. It upwardly provides the total amount calculation basis for regional and sector water rights, and downwardly provides the total amount control basis for water use rights.
2.4. Indicator Selection and Checking
2.4.1. Indicator Selection
Indicator selection varies in different sectors. Indicators in the domestic water use sector include water abstraction permits, water resource use in the most recent three years, regional population planning, and water quota [23
]. For the industrial water use sector, water abstraction permits, water resource usage in the most recent three years, industrial output values, and water quota are selected [23
]. Agricultural water indicators include water abstraction permits, agricultural land area (confirmed area, irrigation area, etc.), water quota, and planting structure [23
]. In the artificial ecological water use sector, indicators include artificial river and lake areas, evaporation, and water resource usage in the most recent three years [28
2.4.2. Indicator Checking
Indicator checking is shown in Figure 1
. There are three levels of verification: sector, water abstraction, and water use. The sector level is to stipulate the lower limit for the total amount. Water rights must guarantee the minimum water demand of each sector. Water abstraction license is the prior basis for indicator selection in various sectors. The total amount of water rights should be checked and reduced in proportion if exceeding the control target of water consumption or water abstraction, in combination with water consumption, quota, and other indicators. If there is no water abstraction permit, then indicators are selected after the authoritative and scientific evaluation of data. The amount of water resources in the water resources assessment report of project construction (hereinafter referred to as the assessment report) and water resources utilization in the last three years are the indicators of water use, which is used as references or data backup.
Considering the future increase in domestic water use, the minimum domestic water right is calculated by planning population and the domestic water quota. The water withdrawal permits will work as the indicator when the sum of the domestic water withdrawal permits meets the minimum domestic water rights. If the domestic water rights are not satisfied, the insufficient part will be included in the reserved water rights, which will be given the highest priority. Industrial water rights are mainly determined by water abstraction and verified by water use data and the assessment report from recent years. If there are further demands for water in the future, and the information in the relevant augmentation is out-of-date, the water reserve rights will include this part. Artificial ecological water rights confirmation is determined by the evaporation of artificial rivers and lakes, which will be verified by the historical water use data from the last three years. As for agricultural water rights, many comprehensive factors need to be considered in the confirmation, where the verification of land area is the most important. The existing data varies for agricultural land area, such as the current cultivated land area, irrigation area, land rights confirmation area, etc. Additionally, the data for land rights confirmation is relatively reliable according to the data authorization. Then, the water rights of each farmer are allocated in proportion to land area, irrigation quota, and planting structure. In terms of legality, the irrigation water rights are determined based on the water abstraction permit and land rights confirmation data, to ensure the unification of water and soil resources in spatial data and administrative license.
Water rights confirmation and registration have had positive effects on water resources management in Deilingha city. The amount of water used by each user is clearly defined. Water disputes were reduced, and the order of water use was better regulated. The clear water rights stimulated the consciousness of water users as protagonists. Water rights institution in Delingha city has entered the next stage, that is, the operation and management of the water market. The local water rights trading platform has been established. However, traditional administration management is still functions by inertia even after the new phase that began in 2020. So far, no trading of water rights has taken place. Water rights only produced the effect on the initial allocation of water resources, but do not play a role in the secondary one. We next discuss the problems and causes from the perspective of institutional change.
4.1. Fundamental Changes in Institutional Logic
First of all, we must analyze the background of the problem, that is, the underlying logic that has changed after the institutional change. From the behavioral logic of the institution, the traditional management under the administrative power and the water rights institution with the property right has very obvious differences in China. Public power emphasizes top–down control, while private rights focus on autonomy. Administrative management is top–down logic, with planning, hierarchical control, and assessment mechanism as the main way. The higher-level government can control the management behavior of the lower-level government through vertical administrative instructions. The “Three Red Lines” are used to control the total amount of regional water use. The performance of relevant water resources managers is assessed by these “Lines”. This kind of assessment of water resources managers allows stronger management to the behavior of water users, in terms of achieving regional water resources utilization goals. Additionally, water users’ behaviors can also be affected by the assessment mechanisms that are formulated by the government. Institution of water abstraction permits is used to limit the rights boundaries of water users. In the management of water users, targets of water use are established, supervised, and assessed.
After the institutional change, the management logic also changed. Water rights institution is a kind of bottom–up management logic. Owing to the confirmation of property rights at the users’ level, water users can rationally use, distribute, transfer, and trade the water resources within the water rights according to their own needs. The subjective initiative of the end user is improved. Water resources are allocated for the second time through a market mechanism such as water rights trading. The independent treatment of water rights by micro-users will make a difference in regional water resources utilization and efficiency. This change will be finally counted and analyzed by the regional government, which will lead to the adjustment and improvement of the policy by the higher government.
4.2. Inadaptation of Change in Government’s Roles
In addition to water users, the government could also perform more roles while obtaining water rights according to the water rights agency mechanism after the change in institutional logic.
First, because of the exclusivity of legal rights, water resources can be formally distributed under water rights compared with administrative directive. After the superior agent within the government devolves the water right to the inferior agent through the hierarchical agency mechanism, the disposal behavior of the lower agent cannot be randomly interfered. For water users, the government is the agent entrusted by the people to carry out public management. During water rights trading by water users, the government acts more as a “referee” and performs the work entrusted by administrative management powers such as guidance, coordination, and supervision through rules-making and platform building. As long as the water users’ behavior is within the scope of their water rights, on the premise of ensuring regional water security, the government does not set additional indicators for rigid assessment, but gives the initiative to each water user.
Secondly, as the agent of regional water rights, the government can dispose the water rights owned by the government according to the law, such as trading with other agents to obtain legal profits. As the owner of water resources, the government can obtain reasonable interests of water resources, and choose to delegate ownership to different levels of government and water users. At this time, the government emerged as the agent of property rights and a member of economic agents, without the privilege. A division must be explicit between the agents of water ownership and the implementers of water management within the government, to avoid a dual role of government department that acts as both athlete and referee. When the government participates in water rights trading, the higher government departments should supervise.
However, it is difficult for the government to change its role immediately because of the administration stereotype. The unnecessary performance appraisal system is decreasing, but the administrative method of planning and assessment is still dominant. To make water rights trading active, the relevant institution extended by administrative planning power at the microlevel may need adjustment. For example, after the water rights confirmation of water users, if a strict target of the water use plan is assessed each year, water users will not be able to flexibly adjust their water use behavior and dispose water rights due to the changes within the year.
4.3. Incomprehension of the Relationships between Water Rights and Water Abstraction Permits
While communicating with water managers, water users, and even legal workers in Delingha city, we found that many people believe that it is unnecessary to establish a water rights registration system because of the existence of a water abstraction permit system. The occurrence of this misconception is not a regional phenomenon. This is a problem caused by the long-term neglect of the ownership and use rights of natural resources in China. Executive power played an excessive role during this period.
(1) The definition of water use rights fails in relevant laws and regulations because of China’s traditional administration management mode. There is no clear relationship between water rights and water withdrawal permits in Regulations or relevant rules and regulations. Water use rights are even the rights that are conducted after water abstraction under the traditional management concept. Water rights are collections of rights including the use of water, abstraction, disposal, and so on. Water abstraction rights are parts of water rights, which are rights of behavioral choice for water users beyond the scope of the urban pipe network. Although in China the water abstraction permit appears before the water rights confirmation (because in China’s current laws and regulations, water use rights have not been clearly defined), but from the logical sequence of rights, the water user is granted with the water abstraction rights after holding the water rights (use rights).
(2) After the establishment of the water rights institution, the proper sense of water rights registration is not properly explained to water users. In traditional consciousness, water allocation has always been viewed as administrative management rather than empowerment behavior. Awarding a water abstraction permit is the action that the government, as water resources manager, endows the applicant with the qualification and quantity of water. In essence, it is one of the ways that the government uses its administrative power to grant water users the right to abstract water. Although the rights to abstract water can be guaranteed, it is administratively granted. Rights registration is the delegation and confirmation of the state’s ownership (water use rights) of its water resources. It covers all water rights with the character of property right as long as it is legal, whether acquired by license, contract, inheritance, or enforcement. This is a hierarchical agent system of property rights, which is completely different from the conferment of administrative power. Endowment of water rights to people is a way for the state to dispose water use rights as water owners. After registration, water rights are long-term and stable rights that protected by the law where the government has no power to interfere with it in general. In contrast, water abstraction permits can be changed and reviewed periodically based on transferring, trading, and changes in water rights. Although the water abstraction rights are confirmed by the Property Law, the certificate is only the administrative licensing that cannot be traded.
Based on the method design, process and result presentation, and discussion of water rights confirmation and registration in Delingha city, the conclusions can be summarized as follows:
(1) Equity is the priority in the principles of water rights confirmation. Equity is embodied in complying and verifying the results of historical water distribution, strengthening public participation, and selecting persuasive and scientific indicators. During the water rights confirmation in Delingha city, it was found that water rights confirmation can be highly authoritative and acceptable only by combining existing management and complying with local water use history. It has been practically proved that the principle of legality priority is highly recognized in ensuring the fairness of water rights confirmation. On the premise of the legitimacy of water rights, it is particularly important to evaluate the data of rights-confirming indicators. A set of water rights confirmation schemes with strong operability was developed after comparing data authorities. The water abstraction permit was taken as the core indicator, with the checking combined with land rights confirmation data, water quota, water use, and other indicators. It is recommended that the authorities should guarantee the right to know of water users through public participation in decision-making. Such an open and transparent process also improves equity for water users.
(2) Water rights confirmation is to recognize and revise the distribution result and management status of the existing institution. Macroscopically, the “Three Red Lines” is the upper control institution for both water rights and the existing administrative management institution. In addition, to ensure that the ecological water demand cannot be encroached by the total amount of water rights, the scheme of water rights confirmation also needs to meet government planning in administrative management. Therefore, the dual-control method of “matching water use and the Three Red Lines” and “matching water consumption and available water resources” were used to control the total distribution of water rights. From the microscopic point of view, there is a close relationship between water abstraction permits and water rights. It does not imply that the former one will be replaced by the latter, but to make better connections. Additionally, water rights confirmation should repair the unreasonable and missing parts in the original administrative management. Water abstraction permits should be the core indicator for water rights confirmation, after checking with other data. It makes sense to improve the connotation of water rights in laws and regulations, except for the water abstraction rights commonly used in administration. For any region that needs to reform the water rights system, it is important for the authorities to determine the status of the new system in the entire management system and its relationship with the old system.
(3) After the water rights confirmation, the institutional logic, the responsibilities and roles of the government, and the intellection of water users will be changed. The traditional administrative management mode will be gradually transformed into a new one of “property rights management and administrative management”. On the premise of complying history and considering future needs, the efficiency and flexibility of water resources management are improved by supplementing the notion of property rights management and relevant connotations. Water rights registration is the key to distinguish water rights from traditional administrative institution. To separate the water rights system from the administrative power of the government, it is necessary to change the traditional belief of the government and water users. Further, the most important is to strengthen the status of rights registration in the process of water rights confirmation. For the government, it is crucial to make clear the difference and boundary between ownership and management power. For water users, it is a priority to differentiate between the essential features of the water rights certificate and water abstraction permit. For the authorities, water rights confirmation and registration are only the beginning and a foundation for the institutional change. In the future, government should embrace additional novel notions in management, and guide water users to actively integrate into the new system. The market mechanism can perform better roles in the allocation of water resources under such circumstance.