The International Centre for Settlement of Investment Disputes (ICSID) of the World Bank, has ruled against the claim of the Spanish company Iberdrola against the State of Guatemala.
The lawsuit filed by Iberdrola, a major shareholder and operator of the Empresa Electrica de Guatemala (EEGSA), in late 2009, was due to a disagreement on the rate of Value Added Distribution (VAD), in force since August 2008.
According to reports, the Spanish utility Iberdrola is in discussions to sell its shares in Empresa Electrica de Guatemala SA (EEGSA) to Colombian company Eléctrica de Medellín (EDM).
Iberdrola's decision would be related to the reduction of tariffs in over 50% approved by the National Energy Commission (CNEE) in June of 2008. In November 2009, Iberdrola sued Guatemala with an international arbitration proceeding for $ 672 million, questioning the reduction.
It is the largest in Guatemala's history, and has its root in lack of agreement regarding an energy distribution tax called 'VAD' (Valor Agregado de Distribución), which came into effect on August 2008.
With this transaction, Millicom International Cellular controls 100% of Navega.
Navega was created in 2000 by Comcel which is part of Millicom, the Spanish company Iberdrola, EDP in Portugal and Teco Energy in the US, and it provides data transport services in Guatemala, El Salvador, Honduras and Nicaragua.
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