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Justice rejects forcing the Consortium to assume Canal Gestión's contracts

The court also denies the request by Canal for generalized access to documentation and facilities and points out that it must be raised in the concession liquidation procedure.

CONSORCIO DEL AGUA DE LANZAROTE  (20) (Copy)eee
CONSORCIO DEL AGUA DE LANZAROTE (20) (Copy)eee

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Through an order dated October 21, the magistrate of court number four of the Contentious-Administrative Chamber of the Court of Instance of Las Palmas de Gran Canaria has rejected the two requests made by Canal de Isabel II in relation to the reversion and taking possession of the service. 

Canal de Isabel II intended for the court to oblige the Consortium to immediately assume all rights and obligations of the contracts that Canal Gestión Lanzarote held with suppliers and other third parties linked to the service. It also requested that all requirements of the former concessionaire be met and that it be granted full access to files, computer applications, and facilities to prepare the settlement of the concession.

The court rejects imposing these obligations as provisional measures while the appeal is resolved. The decision does not constitute a ruling on the merits of the dispute, but it prevents the Consortium from having to provisionally and generally assume the private contracts of the previous concessionaire.

The president of the Cabildo and the Water Consortium of Lanzarote, Oswaldo Betancort, values that “this resolution allows the management of the service to continue to be developed without the Consortium being forced to automatically assume all the private contracts of the former concessionaire. We will continue to defend the interests of Lanzarote and La Graciosa and work to improve the service with the support of our technical and legal services”.

Regarding the request to assume these contracts, the magistrate explains that it would first be necessary to examine whether this obligation is legally valid, a matter that cannot be resolved in this provisional proceeding. She adds that the possible economic damages alleged by Canal could be compensated if it subsequently obtained a favorable ruling.

The order also points out the contradiction between requesting the annulment of the reversion agreement and simultaneously asking for actions to be imposed that the company itself presents as necessary to execute that agreement.

Regarding access to documentation and facilities, the court considers that Canal must submit its requests in the contract settlement procedure. Therefore, the resolution does not establish a general prohibition of access, but rather rejects granting it on the terms requested through this provisional measure.

This pronouncement is in addition to the order of last October 19, which the Consortium reported in a previous note, which rejected suspending the seizure of the eight million euros of contract guarantee. Both resolutions allow the execution of the agreements to be maintained in the aspects provisionally challenged, while the judicial proceedings continue.

The Consortium assumed direct management of the integral water cycle on June 2. Since then, they assure that "it has maintained the continuity of the service and has been processing its own contracting procedures to meet the necessary services".

For his part, the vice president of the Water Consortium of Lanzarote, Domingo Cejas, highlights that “our priority is to guarantee supply, sanitation, and purification, while we organize the necessary contracting and defend public resources. That work continues every day to improve the attention to users in Lanzarote and La Graciosa”.

The new order does not impose costs on any of the parties and allows for an appeal to be filed within fifteen days of its notification.

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