Are you sure?

Hungarian PM offers to mediate for Suez Environnement in renationalization case

Hungarian Prime Minister Gordon Bajnai offered to mediate in a renationalization dispute between the local council of Pécs and the Hungarian unit of France's Suez Environnement at a meeting with the management of the French company in Paris.

“We have no legal means at our disposal, however, if it is about misunderstandings and not a deliberate action, I have offered my assistance in resolving the misunderstandings,” Bajnai said.

The local council of Pécs, which is controlled by the main opposition party Fidesz broke Suez's contract to operate its waterworks in September, after it failed to reach an agreement with the company on buying back its stake in the utility. In early October, the local council set up a company to take over operation of the waterworks.

Suez Environnement Hungary managing director Zoltán Csorba has said Suez wants its ownership rights to be recognized before it starts any negotiations with the local council.

The local council of Pécs owns 50.05% of the waterworks, Suez holds 48.05% and 1.9% is in the hands of other local councils.

“Every investor will watch with interest the kind of message this opposition-led municipality is sending about how they envisage the future in they treat investors,” Bajnai said. “They will obviously draw their conclusions.”

It is in Hungary's interest to send the message that this is a one-off case, which we will hopefully be able to settle, Bajnai added.

The prime minister said the issue does not only affect foreign investors, but legal security in general. “The question is whether it is possible to bypass the usual European legal processes when taking action against private contractors,” he said. “We are in Europe and we must settle our legal disputes in a European manner,” he added. (MTI – Econews)