Oil Report

Italy parliament approves water privatisation law

ROME, Nov 19 (Reuters) - Italy’s parliament on Thursday approved legislation allowing private management of water services, as part of an umbrella law designed to bring Italy into line with European Union regulations.

The new law obliges authorities to lower their shareholding in municipal utilities with water businesses -- such as Acea ACE.MI, Iride IRD.MI, Hera HRA.MI and Enia EN.MI -- to 30 percent by December 2015, from around 40 percent at present.

The law will allow private and mixed-shareholding companies to compete with public ones for management of water resources.

Opposition leaders have expressed concerns that allowing private management of water services, even if the network remains in pubic hands, could lead to an increase in tariffs.

“The privatisation of water is mentioned. This is a simplification: water is and will remain a non-privatisable public resource,” Andrea Ronchi, minister for European Affairs, told a news conference after the legislation was approved. (Reporting by Giuseppe Fonti; Editing by Jon Loades-Carter)