The Supreme Administrative Court revoked a decision by the Arbitration Court that condemned the State to compensate the Algarve casino concessionaire by more than 15 million euros, it was announced this Friday.
The ruling of the Supreme Administrative Court thus upheld the appeal presented by the Portuguese State and deemed the action presented by Solverde – Sociedade de Investimentos Turísticos “totally unfounded”.
Solverde – Sociedade de Investimentos Turísticos intended to be compensated for the impact of the 2008 economic crisis, which “had a significant impact on the gross revenues from the concession contract, which plummeted”, reads the ruling released this Friday.
The Algarve casino concessionaire recalled that, due to the economic crisis, for the first time, “the annual compensation delivered to the State was no longer calculated based on the rules of 35% of the concession’s gross revenues and started to be paid by reference to minimum compensation values” established by law.
In this sense, the intention was that, “in a situation of absolute exceptionality, the State would resign, within three years [2012, 2013 e 2014]the minimum level of financial compensation and agreed to receive the amount equivalent to 35% of the gross revenues “effectively collected” by the concession.
In July 2024, the Arbitration Court ordered the State to pay compensation to the Algarve casino concessionaire.
“The Arbitration Court understood that the crisis [financeira] 2008 substantiates a change in circumstances that had an impact on the activities granted, causing a decrease in the concessionaire’s gross revenues”, as explained in the supreme court’s ruling, dated Thursday, but released this Friday.
Also according to the Supreme Administrative Court, the Arbitration Court ordered the State to pay “compensation for application of the principles of contractual justice and good faith, corresponding to the return of the differences between the annual compensation and the minimum compensation paid by the casino concessionaire of the Algarve between 2012 and 2014 for a total value of 15,527,756.40 euros”.
However, the Supreme Administrative Court has now annulled the Arbitration Court’s decision.
In a 53-page ruling, the judges of the Administrative Litigation Section of the Supreme Administrative Court decided “to grant the review appeal, revoke the arbitration ruling in the part in which it was challenged and, accordingly, dismiss the action as completely unfounded”.
The international financial crisis of 2007–2008 was precipitated by the bankruptcy of the traditional North American investment bank Lehman Brothers, which spread to other large financial institutions.
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