Wednesday, February 24, 2010

Selangor ready to face Syabas in court

The Selangor government is ready to face Syarikat Bekalan Air Selangor (Syabas) in court, should the water company proceed with legal action after the state government refused to allow it to increase water tariffs.

Menteri Besar Abdul Khalid Ibrahim said Syabas, through the Tetuan Cheang and Ariff law firm, sent a letter dated Feb 12, requesting Selangor to pay RM339 million in compensation within 14 days or face legal action.

"The state government has been advised by a panel of lawyers which found that there was no need to do so.

"In relation to that, the state government will stop any attempt to increase water tariffs in Selangor.

"We remain firm that Syabas has gone against many important matters in the concession agreement which was certified by the National Audit Department.

"Syabas has incurred big losses for the people of Selangor," he said in a news conference after chairing a weekly state executive council meeting in Shah Alam today.

Abdul Khalid had brought up the initial proposal to restructure water services in Selangor to improve their quality and avoid tariff increase.

To carry out the restructuring, he said, the state government had made a reasonable offer for a takeover, adding that Syabas thus, had sufficient financial sources as capital for investment.

"We feel there is no reason for Syabas to claim compensation if it accepts the offer.

"Any decision to increase the water tariff must be consented by three parties, namely the state government, concessionaire and central government," he said.

- Bernama

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