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The Supreme Court of Spain endorses the PPP of Agbar and the Barcelona Metropolitan Area Authority

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  • The Supreme Court of Spain endorses the PPP of Agbar and the Barcelona Metropolitan Area Authority
Global Omnium
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The Supreme Court of Spain has endorsed the mixed public-private joint venture known as Aigües de Barcelona, formed by Suez subsidiary Agbar and the Barcelona Metropolitan Area Authority (AMB), thus overturning the invalidation issued by the Catalonian Supreme Court of Justice (TSJC).
 
The TSJC invalidated in March 2016 the awarding of water management services in the Barcelona metropolitan area to the public-private joint venture led by Agbar, based on that the public authorities did not sufficiently justify their decision not to put the contract out for public tender. Now the Administrative Chamber of the Supreme Court has upheld the appeal against the TSJC decision, concluding that the procedure was valid under the Spanish Public Sector Contract Law
 
The court has issued a decision on the validity of the process of creation of the mixed public-private ownership company in charge of integrated water cycle management in Barcelona and another 23 municipalities, of which 70% is controlled by Agbar, and the Barcelona Metropolitan Area Authority (AMB) and Criteria Caixa each hold a 15% stake.
 
The decision of the Supreme Court is a setback for Barcelona’s City Council ruling party Barcelona en Comú, who was hoping for a ratification of the TSJC 2016 decision as an opportunity to initiate a remunicipalisation process of water services in the 23 municipalities where Aigües de Barcelona operates.

Statement by Agbar 

In relation to this, Agbar has issued a statement affirming that Aigües de Barcelona will continue to provide water supply and sanitation services to Barcelona and the metropolitan area. 

The Spanish Supreme Court has confirmed the legitimacy of the creation of the mixed public-private ownership company Aigües de Barcelona Empresa Metropolitana de Gestió del Cicle Integral de l’Aigua, comprised of SGAB, CriteriaCaixa and the Barcelona Metropolitan Area Authority (AMB), considering it is lawful and dismissing the appeals against its creation.

Agbar stated the following:

1. Aigües de Barcelona will continue to provide the drinking water services, as well as sewerage and treatment services, provided by the AMB when the public-private company was formed, ensuring the continuity, quality and excellence of services, as it has been doing up until now.

2. The Supreme court ratifies the position of AGBAR and the AMB in integrated water cycle management, accepting the agreements adopted in 2012 and 2013 by the metropolitan entity as fully legal, effective and lawful.

3. In this manner, Agbar sees its arguments defending the creation of the public-private company fully ratified, with the dismissal of the appeals against the creation of the public-private company Aigües de Barcelona.

4. The sentence confirms that AGBAR is the only company able to provide these services to the 3 million people in Barcelona and its metropolitan area. No other company holds title over the essential infrastructure and facilities to provide these services, built and financed by AGBAR.

5. The sentence ratifies the assets valuation of AGBAR (worth €476 M) done during the creation of the public-private company and endorsed at that point by experts appointed by the Commercial Registry.

6. The Supreme Court also rules that AGBAR holds a valid and full legal title to provide domestic water supply services and thus the economic valuation of the contribution made during the creation of the public-private company is correct.

7. Therefore, the court decision endorses Aigües de Barcelona as the manager of the integrated water cycle up to 2047, in the metropolitan area of Barcelona.

8. AGBAR celebrates that the court decision ensures the stability and unity, as well as the employment conditions, of the 1,154 people employed by the Aigües de Barcelona public-private company.

9.  AGBAR trusts that this ruling will provide institutional stability and legal certainty to address, jointly with the public regulatory entity (AMB), the climate emergency that right now requires all our efforts to fight the effects of climate change, also in terms of water management and alternative water resources.

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