Buenos Aires court blocks AySA privatization process and sends case to federal judiciary

A Buenos Aires provincial court has stopped AySA from changing the conditions under which it provides water and sewerage services while the company moves toward privatization.

The Second Chamber of the La Plata Court of Appeals for Administrative Litigation upheld an injunction requested by Buenos Aires provincial Ombudsman Guido Lorenzino. The order prevents AySA from modifying, reducing, limiting, suspending or otherwise weakening its obligations involving access to drinking water, public health, a healthy environment and the proper provision of the essential public service.

The court also sent the case to the federal judiciary. The ruling confirmed that the dispute must be heard in federal court rather than by the provincial courts, even as it upheld the injunction issued by a lower court in La Plata.

Lorenzino’s lawsuit alleged that AySA had advanced a new contract that lowered environmental, health and consumer-protection standards for drinking water and sewerage services in the 26 municipalities of the Buenos Aires suburbs and metropolitan region where the company operates.

The contract forms part of the broader privatization process established by the Bases Law, which declared AySA subject to privatization. Decree 494 authorized the transfer of 90% of the company’s share capital into private hands. The new agreement, signed in May 2026, set the operating conditions for the service under that framework.

The decision comes as the national government prepares to open proposals on September 15 after postponing the submission deadline. The process will identify potential buyers for 90% of AySA’s shares, and the government has said it expects to collect $450 million. AySA appealed the injunction, while the provincial ombudsman appealed the decision to transfer the case to federal court.