By Brazil Stock Guide – Brazil’s Supreme Court unanimously rejected two lawsuits seeking to halt the privatization of Companhia de Saneamento Básico do Estado de São Paulo, or Sabesp (SBSP3), without ruling on the merits, citing procedural deficiencies in the claims.
According to the court, the justices followed the opinion of Justice Cristiano Zanin, who concluded that the cases lacked the necessary legal grounds to proceed under the constitutional review framework.
The lawsuits, filed by multiple political parties, targeted both municipal and state laws underpinning the privatization process. One claim challenged São Paulo’s municipal legislation authorizing service contracts and the privatization timeline, while another contested a state law enabling the government to reduce its ownership stake in Sabesp.
Zanin said most of the arguments failed to present “consistent and specific” reasoning required for constitutional scrutiny. He emphasized that Brazil’s Supreme Court does not admit broad or generic challenges in concentrated constitutional review proceedings.
The justice also pointed to the principle of subsidiarity, noting that such actions are only admissible when no other effective legal remedy is available. In this case, he said, the matter could be addressed by the São Paulo State Court of Justice, which has already upheld the legality of the measures.
Additionally, the ruling highlighted that the lawsuits raised technical and contractual issues tied to the privatization process, requiring detailed evidence and fact-finding—procedures incompatible with the type of legal action filed.
The decision was issued in a virtual plenary session concluded on Friday (27).
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