Companhia de Saneamento Básico do Estado de São Paulo - Sabesp, pursuant to CVM Instruction 358 of January 3, 2002, and amendments thereto, hereby informs its shareholders and the market in general that, on October 21, 2014, its Board of Directors, pursuant to item VI of article 13 of the Bylaws, resolved that the Company submit to the São Paulo State Sanitation and Energy Regulatory Agency (ARSESP) a request to authorize changes to the discount ranges of the Water Consumption Reduction Incentive Program ("Bonus Program") due to the following facts:

a) The critical state and worsening of the water shortage and the consequent need to adjust demand to supply in order to favor the more rapid replenishment of the reservoirs; and

b) The need to increase the population's adherence to the Bonus Program and motivate those who reduced their consumption but did not reach the target.

The proposal considers the following discount ranges:

Also in accordance with the proposal:

a) The average over which the reduction in water consumption will be determined will remain that of the months of February 2013 to January 2014; and

b) The scope of the program will continue to comprise those municipalities directly served by the Company in the Metropolitan Region of São Paulo, as well as those municipalities operated by Sabesp in the Piracicaba, Capivari and Jaguari Water Basin located in the Cantareira System catchment area.

The new Bonus Program ranges will enter into effect following deliberation by ARSESP.


São Paulo, October 21, 2014.

Rui de Britto Álvares Affonso
Chief Financial and Investor Relations Officer


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