REPORTS
Law 4964/2022 fails to comply with Council of State decisions requiring public water companies to remain under state control
On 28 July 2022, the Greek government passed Law No. 4964/2022 (Government Gazette A’ 150/30.07.2022), which amongst other things, changed the shareholding status of EYDAP and EYATH, the two public companies that manage water in Athens and Thessaloniki. More specifically, Articles 114 and 115 of Law No. 4964/2022 transferred the state’s majority shareholding of EYDAP and EYATH to the Hellenic Corporation of Assets and Participations S.A. (HCAP), and declared that any decision to change the shareholding of the water companies EYDAP and EYATH cannot lead to a reduction in the percentage of HCAP’s shareholding in these companies or the loss of its absolute majority in the share capital of these companies.
The adoption of these provisions raises serious issues around the separation of powers and around the respect for judicial decisions by the administration within the framework of the rule of law. This is because these laws are contrary to the decisions and case law of the Council of State (OLE 190-191/2022) given that the transfer of the majority shareholding of EYDAP and EYATH, previously owned by the Greek state, to the National Fund of Greece (HCAP) has already been formally declared contrary to the Constitution on the grounds that, according to the former Vice President of the Council of State, Maria Karamanov, the Constitution requires that these two companies be not only under the supervision, but under the effective control of the Greek state, which presupposes that the State holds the majority of the share capital of these two public utility companies.
HCAP is a limited liability company and, according to its founding law, is a purely profit-making private entity entrusted with the economic exploitation of the State’s property for the servicing of the country’s loan obligations. As such, the Council of State considered the objectives of HCAP as inherently incompatible with the public utility purpose of EYDAP and EYATH and with the provision of water as a public service. According to Article 95 (5) of the Constitution, the administration is obliged to comply with judicial decisions. However, with the adoption of Law no. 4964/2022 the government disregards the rulings of the Council of State on this issue. The former vice-president of the Council of State has commented that the blatant contempt for judicial decisions by the executive shakes the foundations of the constitution and causes a rift in the principles of the rule of law.
The Plenary of the Presidents of the Greek Bar Associations have also declared their opposition to the provisions of Articles 114 and 115 of Law 4964/2022, against the background of the Council of State case law on the public character of water and the constitutional obligation of the administration to comply with judicial decisions.
In a state governed by the rule of law, the administration must comply with the decisions of the judiciary.
However, and despite the relevant provision in Article 95 para. 5 of the Constitution, the Greek government violated its obligation to comply with the decisions and case law of the Council of State on the public character of water (OIEC 190-191/2022) by passing Law No. 4964/2022, which contradicts the content of the decisions of the Supreme Administrative Court.
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