Abertis hauls Argentina’s new government before the World Bank on account of two motorways

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Author: Antonio M. Vélez, 21-12-15

Abertis hauls Argentina’s new government before the World Bank on account of two motorways

Translated by Anoosha Boralessa (Feb 2016); not reviewed by bilaterals.org or any other organization or person.

 The Spanish company files a request for arbitration with ICSID for tariff freezing.
 The complaint comes one week after Mauricio Macri’s new government takes office.

A week after a new Argentine Government has been established, Abertis has hauled Argentina’s Attorney General’s Treasury Office before the World Bank’s Arbitration Dispute Settlement body (known as ICSID) for freezing tariffs applied to two concessions for motorways controlled by the Spanish company in Argentina.

According to statements on the International Centre for the Settlement of Investment Disputes (ICSID)’s website, the same body before which Repsol made a claim against Argentina for expropriating YPF, and the same body where more than twenty requests have piled up from foreign investors against Spain for retroactive cuts to payment for renewable energy, the claim was filed last Tuesday on 17 December. Albertis’s legal representative in this matter is the Washington Office of the law firm Freshfields Bruckhaus Deringer. Questioned on this matter, Abertis has refused to comment.

According to sector sources, the dispute relates to the non-application of tariff increases provided in the contracts for two concessions for motorways that Abertis has in the South American country: Grupo Concesionario del Oeste (GCO) and Autopistas del Sol (Ausol).

The Spanish company leads the process because it is the majority shareholder in both companies. The concessionaires claim that freezing tariffs disrupted the financial and economic balance in these concessions, putting it out of sync. According to business sources, the presentation of the claim at this time, a week after Mauricio Macri has come to power, has not had anything to do with the change in political scene. It has now come to ICSID due to the expiration of a time limit; because Abertis has already initiated formal dialogue with the Argentine government to request rebalancing the tariffs but has not had a response.

Abertis has a 48.6% shareholding in GCO but holds 57.6% of the voting rights. The other shareholders are the Malayan fund IJM (20.1%). The remaining capital is listed on the Buenos Aires Stock Exchange. This company operates the West motorway that is 56 kilometres long joining Buenos Aires and Luján. The concession ends on 31 December 2018.

With respect to Ausol, in July 1994 it was awarded a contract for improving, extending, remodelling, upkeeping, maintaining, operating and administering the Acceso Norte to the city of Buenos Aires. This contract ends on 31 December 2020. Abertis has a 31.5% shareholding but controls 57.6% of the concession’s voting rights. This participation has been totally provided for in its 2014 accounts. The second biggest shareholder is the Italian construction company, Impregilo, (19.8%), followed by ACS, the construction company chaired by Florentino Pérez, that directly holds 5% of the shares and holds another 7% through Dycasa. The local construction company Sideco controls the other 7%.

source : El Diario

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