By Brazil Stock Guide The Legislative Assembly of Minas Gerais (ALMG) moved forward with a constitutional amendment that would eliminate the requirement for a popular referendum before privatizing Companhia de Saneamento de Minas Gerais (Copasa). The proposal, a top priority for Governor Romeu Zema (Novo), passed the Constitution and Justice Committee (CCJ) in a 5-2 vote.
Supporters emphasized that the committee was ruling on constitutionality rather than the merits of privatization. Committee chair Doorgal Andrada (PRD) told reporters: “What we analyzed in the CCJ is whether the idea presented complies with the rules, legality, and the Constitution. We are not deciding now whether we will remove the referendum on Copasa”, according to O Tempo.
The amendment initially also covered energy utility Cemig (BVMF:CMIG4), but lawmakers removed it. They preserved the requirement for a three-fifths supermajority (48 of 77 deputies) for plenary approval. The amendment now heads to a special committee for further review.
Protests and Opposition
Dozens of members of the water utility workers’ union Sindágua protested during the vote, chanting “Zema thief, Copasa belongs to the people” and wearing shirts with slogans such as “if it’s a right, it’s public.”
Opposition lawmakers argue the measure strips citizens of their constitutional right to decide. Deputy Cristiano Silveira (PT) said: “Let the people decide. Let the owner of the company, the people of Minas Gerais, say whether they authorize it or not.” He added that the opposition will continue obstruction tactics: “In every place that privatizes, service deteriorates, worsens, and costs rise. During the obstruction process, we gain time to increase information to society.”
Privatization Bill and Expected Proceeds
Separately, the Zema administration is pushing a privatization bill for Copasa. A revised version mandates that proceeds be used under the federal debt restructuring program Propag. Vice Governor Mateus Simões explained: “The floor value, just over 4 billion reais, would be enough for four years of extraordinary investments under Propag.”
The state expects to raise around 4 billion reais ($710 million), or 10% of the 40 billion reais it must provide upfront to renegotiate its debt with the federal government. Funds would also finance legally required investments in education, security, and infrastructure.
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