The Government advances in the privatization of four power plants and calls for public tender

The Government advances in the privatization of four power plants and calls for public tender

The Government advances in the privatization of four power plants and calls for a national and international public tender for the sale of the share package controlling of Alicurá Hidroeléctrica Argentina SA, Chocón Hidroeléctrica Argentina SA, Cerros Colorados Hidroeléctrica SA and Piedra del Águila Hidroeléctrica Argentina SA within the framework of the Bases law.

For 180 calendar days, the transformation of these public companies in coordination with the Ministry of Energy, which depends on the Ministry of Economy, to proceed with the sale of the majority or controlling share package of each of these companies. The news was confirmed by Decree 895/2024 published in the Official Gazette, with the signature of Javier Milei, the chief of staff Guillermo Francos and the minister of economy, Luis Caputo.

Within the majority share package that is intended to be privatized, the remuneration scheme for concessionaires during the Concession Period and at least the following annexes must be included:

  • Concession Contract
  • perimeter and description
  • inventory
  • safety of dams, reservoirs and auxiliary works
  • water management standards
  • permanent guards
  • environmental protection
  • insurance
  • mandatory works and works.

At the same time, the Ministry of Energy was authorized, prior to the intervention of the Agency for the Transformation of Public Companies, to carry out any management required for the transfers to the property companies and/or the use and enjoyment of the assets achieved, as well as the transfer of personnel and contracts that are essential and/or convenient for the normal operation of the Hydroelectric Complexes and the generation of electrical energy. In turn, Energía will set the guidelines for the aforementioned contest and prepare and sign the documents necessary for the completion of such transfer of shares.

So far, the share package of these four companies is owned by ENARSA and NASA, 98% and 2%, on a “transitory” basis until the produces the transfer of said share packages to the private sector through a national and international public competition.

The Bases law was regulated and the Government’s privatization plan began

In this first stage, the regulations became effective through decree 695/2024 published in the Official Gazette, through which the Executive established the regulations linked to Title II, which contemplates modifications in the public employment system, changes in administrative processes and privatizations of public companies.

In this way, it was established that the minister or secretary of the Presidency in whose jurisdiction the company or society to be privatized is located must submit to the Executive Branch a report specifying the specific proposal linked to the most appropriate procedure and modality to make it effective. privatization.

What steps should be followed to privatize companies

This document will have to include the following points: the total or partial nature of the proposed privatization and its rationale; the procedural alternatives that are deemed appropriate to the case; the modalities of the statements that are considered convenient to materialize privatization; the selection procedure that is planned to be used and the estimated deadlines for each of the stages of the privatization procedure; and the eventual proposal for the granting of the preferences referred to in Article 16 of Law No. 23,696 and the applicability, if applicable, of a Participated Property Program, specifying the classes of acquiring subjects and proportion of the share capital included in the program. A copy of this report will be sent to the Bicameral Commission of Congress.

Once the Executive grants the corresponding authorization, the official may begin the procedures leading to privatization. After this, the Government specified the steps to follow to call for offers from the private sector.

“Prior to the formalization of the contracts that arise from the procedures provided for in this Chapter, The Enforcement Authority must intervene to the National Treasury Attorney General’s Office and the General Audit Office of the Nation. in the corresponding actions”, clarifies the regulations and adds that in the event that the Attorney General’s Office makes any observation or suggestion to the contract, a new report must be prepared.

Companies that could be privatized

Subject to privatization:

  • Nuclear Power Argentina
  • Río Turbio Carboniferous Deposits
  • Intercharge
  • Enarsa

Subject to privatization or concession:

  • AySA
  • Argentine Trains
  • Belgrano Loads
  • Road Corridors

Source: Ambito

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