By Brazil Stock Guide – A federal court in Brasília ordered the suspension of a regulatory proceeding targeting Enel São Paulo, a unit of Italy’s Enel SpA (ENEL IM), in a ruling issued Thursday (19). The injunction temporarily halts the process conducted by Brazil’s electricity regulator, Agência Nacional de Energia Elétrica (Aneel), which had been assessing the potential termination of the company’s concession contract.
The decision also nullifies, on a provisional basis, a recommendation by Aneel’s Director-General Sandoval Feitosa to revoke the concession, effectively freezing any deliberation on the matter until further judicial review.
Judge Pollyanna Martins Alves found that the administrative process may have violated fundamental legal safeguards, including due process, the right to adversarial proceedings, and full defense. The ruling highlighted that Aneel advanced its judgment before the expiration of the official deadline for the company’s defense, which was set for February 26.
The court also pointed to procedural flaws in how the regulator handled recent developments in the case, noting a lack of proper communication detailing the alleged breaches attributed to the utility.
According to the decision, continuing the process under potentially flawed procedural grounds could result in significant harm, affecting service provision, consumers, and the company itself.
The injunction prevents Aneel from bringing the concession termination case to a vote in any session until a final judgment on the merits is reached, maintaining the validity of Enel São Paulo’s concession for the time being.
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