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You are correct.

I'm not sure why I remember cement to be water proof. Its possible I infered from how its been used around me. I have seen cement very often used where water contact is expected (bathrooms etc). I have also seen brick walls plastered with an extra layer of cement as putty considered to be rain proof and any leaks were thought of as poor workmanship rather than poor material choice.

P.S. I'm not a builder. I've taken an interest in the topic a few months ago.

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Might be because it's water tolerant, i.e. it doesn't break down with exposure to water? Roman über-concrete stories are always full of "check out the concrete that's sitting in sea-water, it's still going strong! maybe it even helps!" cases too.
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Hydraulic cement is made for some of those occasions:

https://www.quikrete.com/productlines/hydraulicwaterstopceme...

But I wouldn't want to make any sort of building that only relied on it for waterproofing.

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You can also just see it with cement board - if you pour water on top of it, it will eventually migrate through and drip.
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Also if you put a slab basement in a hillside in a rainy area. Water will percolate up through the slab unless you make good drains to divert the water around your foundation.
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The key here is “based on Portland cement”, which is generally has water repellent added to it making it water proof.

Normal cement, concrete .. Is a different story.

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I'm not sure exactly what you're saying is correct.

'Concrete' is a combination of sand, cement, water and aggregate, that cures together to form.

When the water migrates away from the curing concrete, it leaves open pores behind that future moisture can move through.

https://en.wikipedia.org/wiki/Portland_cement

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Concrete is generally porous and definitely not micro-waterproof (aka lots of water vapor makes it’s way through). Including if using Portland cement.

It is generally macro-waterproof, however, unless there are large cracks.

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