Due to a precautionary measure filed by the Government, a judicial case that has been going on for almost 20 years is once again halted

The concessionaire company that operates the Western Accessone of the main access routes to the City of Buenos Aires, received a setback in a court case which is now stuck again and has been going on for 18 years, since Toll rates were pesified.

In a note he sent to the National Securities Commission (CNV), Western Concessionary Group SA (GCO) explained that was notified of the filing of a precautionary measure presented by the Government within the framework of File No. 59,107/2022/1, pending before the National Court of First Instance in Federal Administrative Litigation No. 7.

The measure involves the provisional suspension of the arbitration process carried out by a committee of specialistscontemplated in the Comprehensive Contractual Renegotiation Agreement of the Western Access Concession Contract approved by Decree No. 608/2018, in 2018, CGO detailed. In this way, The firm must refrain from continuing to promote the arbitration procedure until a final judgment is issued in the judicial process.

“The injunction was issued at the request of the National Highway Authoritywhen the trial hearing was about to take place of the arbitration procedure promoted by GCO before the Court of Arbitration of the International Chamber of Commerce (ICC)which was to take place between September 23 and 26 in the City of Buenos Aires,” the company explained in the communication to the CNV, with the specialists who had just arrived in the country.

“It constitutes a direct interference with the arbitration procedure initiated by GCO before the ICC, as contractually agreed with the State, while deepens the severe impact of the rights of the Company, resulting from the non-compliance and the continued attempt by the Grantor to ignore the validity of the Comprehensive Renegotiation Agreement,” he noted.

GCO announced that it will appeal the decision: “The Society Will file all available resources in order to preserve the legitimate rights that assist him, which are seen to be seriously and arbitrarily affected. Likewise, it is permitted to call once again the attention of the authorities of the Argentine State to the impact that this type of measures generate for legal security and the rights of investorsby ignoring commitments opportunely assumed by the Republic through its highest authorities.”

The contract was broken in 2002 When the Emergency Law and the exit from convertibility were enacted, pesified the rates. During the presidency of Néstor Kirchner, In 2006, a partial renegotiation agreement was reached between the parties, which was subsequently breached, causing harm to CGO, which began to have costs in dollars and rates in pesos.

In 2018, a Comprehensive Renegotiation Agreement was reached by a Decree signed by the then president Mauricio Macriissued in accordance with applicable regulations and procedures, after all established control bodies (including the National Treasury Attorney’s Office and the National General Comptroller’s Office) issued a favorable opinion regarding its approval.

For a brief period, This put an end to Argentina’s non-compliance after more than 15 years.and management sent him a signal to the market to achieve new investmentssince it made it possible to drop the lawsuit at the International Centre for Settlement of Investment Disputes (ICSID), which had been initiated by Abertis, one of GCO’s international shareholders. The agreement involved significant reductions: the amount claimed was reduced by a third approximately, although with a ‘wait’, since it would be collected over the course of several years with the operation of the highway itself.

In 2022con Alberto Fernandez, the National State issued a Decree for achieve a judgment of harmfulness y declare the agreement null and void and so on nationalize the management of the highway. For its part, GCO resorted to the instances provided for in the contract and The arbitration process begannow interrupted, which advanced with its procedural stages, with active participation of Argentina, represented by the Treasury Attorney’s Office, until last Friday.

In the sector, they explain that This decision leaves Argentina in a bad positionin a context in which the country faces several claims before the ICSID (one of them, this one) and in which The Government intends to generate new investments through the RIGI.