Ede-Este takes CDEEE to court - Dominican R.

Published: Thursday, August 21, 2003 18:09 (GMT -0400)

By Business News Americas staff reporters

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Dominican Republic power distributor AES Distribuidora del Este (Ede-Este) has started legal proceedings against state power company CDEEE for freezing its accounts in a dispute over debt payments, local newspaper Listin Digital reported.

The first hearing will be held in capital city Santo Domingo on Friday (August 22).

According to Ede-Este, CDEEE moved too quickly because there are mechanisms of compensation between the two companies that should have been used before resorting to such drastic action.

The country's finance minister Jose Lois Malkun had previously warned Ede-Este that the government could take legal action to force the company to pay debts owed to CDEEE.

Edeeste reportedly had a debt of 1,300mn pesos with CDEEE in June, of which 700mn pesos were capitalized, leaving 600mn pesos outstanding.

However, the CDEEE's actions are unjustified because it is supposed to deduct bills from government institutions considered "vital services" from Ede-Este's debt, according to Ede-Este.

Ede-Este has supplied 90mn pesos worth of power to these institutions over the last few months, and the CDEEE has received partial payment of 30mn pesos from the finance ministry corresponding to those bills, but it has not reduced Ede-Este's debt proportionally, the company said.

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