Aguakan’s Legal Crisis Threatens Water Supply

Cancún, Quintana Roo — The water utility company Aguakan is reportedly nearing what sources describe as a "catastrophic finale" in its legal battle to retain the concession for potable water supply in northern Quintana Roo. This development comes despite the company having recorded substantial profits locally and nationally, including through its listing on the Mexican Stock Exchange.

The company's decline reportedly began when it refused to pay a court-ordered settlement for an unjustified dismissal, leading to the seizure of four of its bank accounts in Playa del Carmen. The company had previously been supported by Quintana Roo officials, including the legislative bloc of the then-ruling party.

Aguakan has repeatedly managed to prolong the judicial review process against an unfavorable ruling concerning the revocation of its water supply concession. It has done so by alleging that federal magistrates have conflicts of interest. Separately, Mexico's Supreme Court (SCJN) refused to lift an injunction that currently prevents the withdrawal of the water supply concession from Aguakan, after it dismissed a petition for review filed by the Quintana Roo Consejería Jurídica.

Chronology of a Labor Dispute

The freezing of the company's accounts stemmed from a labor lawsuit under the old labor system, which was ruled in favor of a professional employee of the company, an entity accused of abuses in the four municipalities where it holds the water supply concession.

A worker was unjustly dismissed and initiated a labor arbitration claim in 2018 before the Playa del Carmen Conciliation and Arbitration Board, through which he claimed various benefits and back pay from the concessionaire.

In 2023, the board ruled the claim in favor of the worker and notified Aguakan to pay the debt. According to court documents consulted by Sol Quintana Roo, after the concessionaire refused to pay, the Conciliation Board ordered the seizure of the company's accounts at HSBC, Monex, Banco del Bajío, and Santander in September 2024. This action was intended to force the concessionaire to settle the debt.

The court document stated: "It is requested that the amount be deposited before this jurisdictional authority so that the immobilization order may be lifted; consequently, it is ordered to issue an official letter to the same, so that it remits a cashier's check to the official records office of this Honorable Board within A TERM NO GREATER THAN 24 HOURS."

In response, Aguakan filed an indirect amparo (constitutional protection) lawsuit, which was resolved in August by the Eighth District Court. The court partially ruled in the company's favor. Dissatisfied with the continued freezing of its bank accounts, the company, Desarrollos Hidráulicos de Cancún, filed an appeal through the amparo en revisión figure in the Third Collegiate Circuit Court, which is yet to announce its verdict.

Thus, Aguakan faces legal problems on multiple fronts at a time when its water supply concession hangs by a thread.

A Fortified Legal Maneuver

Adding to the above, Aguakan achieved its objective of prolonging the review process against the unfavorable ruling on the revocation of its water supply concession by alleging that federal magistrates have conflicts of interest.

Desarrollos Hidráulicos de Cancún, the parent company of Aguakan, was not successful in an amparo lawsuit it filed against the revocation of the concession, which was approved by the Quintana Roo State Congress in December 2023. The company filed an appeal through a recurso de revisión.

This appeal was filed with the First Collegiate Circuit Court for resolution; but five months after its admission, nothing has been resolved because the company claimed the magistrates have a conflict of interest due to their relationship with the Quintana Roo government.

The company filed motions for recusal and disqualification that are now being resolved by the Third Collegiate Circuit Court. However, this has served as a tactic to buy time, as there is little in the way of arguments that demonstrate the alleged conflict of interest, described in the report as a "mere legal chicanery."

According to the court file consulted by Sol Quintana Roo, the panel of magistrates was formed to resolve this matter. It stated: "Having seen the status of the case file, as of the cited date, this collegiate body is integrated by magistrates Leonel Jesús Hidalgo (president), Berenice Penélope Polanco Córdova and Lenin Salvador Zenteno Ávila."

This has further prolonged the lawsuit against Aguakan, following the Supreme Court's resolution not to admit a recurso de revisión against the definitive injunction that has paralyzed the handover of the concession to the Quintana Roo government. Through these legal maneuvers, the company seeks to indefinitely prolong the lawsuit while providing poor service to the population in Cancún, Playa del Carmen, Puerto Morelos, and Isla Mujeres.

Without Federal Backing

Previously, the Supreme Court of Justice of the Nation refused to lift the injunction that prevents the withdrawal of the water supply concession from Aguakan, after it dismissed a petition for review filed by the Quintana Roo Consejería Jurídica.

This leaves in effect the definitive injunction granted to the concessionaire in January 2024 within the amparo lawsuit 1323/2023, a case which the company lost but which remains in effect because it was appealed.

In response, the Government of Quintana Roo appealed the decision, which fell to the First Collegiate Circuit Court. Given the delay in resolving the matter, and concurrently with the main lawsuit already proceeding in a second instance, the government requested the Supreme Court to resolve only the issue of the injunction.

Consequently, matters related to Aguakan, particularly the revocation of the concession promoted by deputies of the previous legislature, will be resolved in courts and tribunals in Quintana Roo, which will have the final say regarding the potable water supply contract it maintains in four municipalities of the state.

Following this, the new Supreme Court presided over by Hugo Aguilar Ortiz has distanced itself from any action related to Quintana Roo and the water issue. This is the second case the Court has refused to resolve, as the previous Chief Justice, Norma Lucía Piña Hernández, had already rejected a similar request, though it was more related to an arbitration matter.

A court document sent to the First Collegiate Circuit Court within case file 245/2024 states: "The Supreme Court of Justice of the Nation, referred by the Ministerial system, in accordance with General Agreement number 12/2014, by which it informs that the request for the exercise of the power of review filed by the party opposing the appellant in the present case has been dismissed."

Losing Legitimacy, But Earning Millions

In Quintana Roo, the company Aguakan is springing leaks—but not where it should be. While it faces a fierce legal battle to retain its questioned potable water and sewerage concession and continues with its abusive practices reported by users and authorities, the company is celebrating another year of juicy profits.

So far in 2025, Aguakan has reported revenues of over 1,743 million pesos, confirming that, at least on the Mexican Stock Exchange, its figures continue to flow with financial health, even if its services are fundamentally flawed.

The contract that allowed it to operate in the municipalities of Benito Juárez, Isla Mujeres, Puerto Morelos, and Playa del Carmen has been challenged due to years of abuses: excessive charges, arbitrary service cuts, service omissions, and violations of basic human rights. This is despite Article 4 of the Constitution establishing that every person has the right to access, disposal, and sanitation of water for personal and domestic consumption in a sufficient, safe, acceptable, and affordable manner.

However, Aguakan continues to shut off the water supply to those who cannot pay its inflated rates, regardless of court rulings or official recommendations. But while citizens fill buckets, Aguakan fills its coffers.

From January to June 2025, the company reported to the Mexican Stock Exchange net income from services (water, sewerage, and sanitation) of 1,743.3 million pesos, an increase of 1.1 percent compared to the same period the previous year. This variation, although slight, is explained by higher income captured in the municipalities it still controls.

In contrast, income from network expansion fell by 45.1 percent, revealing that the company has significantly reduced its investment in infrastructure. In other words: it charges more, but builds less.

Its operating costs for providing services also increased by 7.8%, but not due to improved quality: the increases were in personnel expenses, electrical energy, and equipment depreciation. Aguakan justified this increase citing its payroll and maintenance costs, but service in neighborhoods remains intermittent and with minimal pressure, according to citizen complaints.

The EBITDA Paradox: More Profit, Less Service

Despite the increase in costs, Aguakan's EBITDA in 2025 remains at 618.1 million pesos, a figure barely higher than the previous year, allowing it to maintain its profitability without the need to improve service. That is, Aguakan's profitability no longer depends on efficiency or expansion, but on squeezing the existing operation, even if it collapses under the pressure of a growing population.

The construction segment—which according to International Financial Reporting Standards (IFRS) is recorded as accounting income but does not represent effective collection—fell to 116.7 million pesos, evidencing that the deferral of investments is a planned strategy, while the company stretches the existing infrastructure to its limit.

An Unpopular but Profitable Company

Aguakan has been the subject of multiple citizen protests, which demand the cancellation of its contract for non-compliance, abuses, and rights violations. Even the Quintana Roo Congress has attempted to withdraw the concession, and it is currently being decided in courts whether the company will continue to control the water for more than a million people.

But in the financial world, the narrative is different: Although net profit fell by 6.2%, the company still earned almost 295 million pesos in the first half of the year.