-C ONTE NTS

,.,., F6rum

ter meio eletrônico, inclusive por essa do Edi tor.

" stored il1 a refrievnl sys lem, ol' IH in writing of Editora Fórum LIda.

",evedo Marques Neto ino de Oliveira Jacoby Fernandes :astro

iglleiredo (in memoriom) IZ

narosano Zanella Di Pie tro on de Pontes Saraiva Fi lho to , Bacellar Filho

)U sa co 1 -6' Região

:0

'os - CEP 301 30·007 900 / 21 21.4949 Iraforum.com.b r

O; Cesar A . Guimaràes Pereira. nacional de Direito Público, 2).

as reguladoras. I. )usten Filho, :)rum Internacional de Djeeito

COO: 34 1.3 COU: 342.9

12 da Associação Bras ile ira de

"fras/ me/lire Law 01 Braú l. Belo Fórum Internacional de Direito

PREFACE ANO ACKN OWLEOG MENTS . .15

NOTES ON CONTRIBUTORS .. , .... .. .. . " , ,,,,,,,,,,,, ,, . ,, ,,,,,, .. ,,. ,, ......... ,, .. ,, ...... , .. ,, .. ,,.,, .. . ,,,, ,, .. . ... '"'''''''' ' '' ' .17

P ART I

ESSAYS

AN OVERVIEW OF BRAZILIAN LAW

Marçal Justen Filho ... """."..... .. .......... "". "" .. .. " .,.23

1 The constitutionalizing of Brazilian law ......... .. .. " ..... . ,.23

2 The organization of the Brazilian State " .... ". " ... . ..... 24

2.1 Republic .. "" .. . .. .. " .""" .. .. .. , .. 24

2.2 Federation .......... " ... " ...... , .. " .. .. ," ....... .... ...... .. .... ... ........... .. .. ,.. ............. " ." ..... 24

2.3 The separa tion of powers.... .."" .. ".......... ............... .. .. 24 2.4 The Public Ministry ("Minis tério Público") and the Courts of Accounts .. 25

2.5 The role of the Courts of Accounts .. ............. ..... . ........................................ "." ...... 26

3 The lack of Administrative Jurisdiction in Brazil ........... " ... .... "" .... .. ...... .. ... 26

4 The universality of judicial review ............... .. .... , .. " .... , ................ " ...... 26

5 Constitutional control .......... .. .. ....... , .... ,.. ... .. , ..... ,27

6 The principIe of legality ...... .......... .. ... ..... ...... .. .. .. , ............ .. ........... .. 27

7 Due process of law ................ ...... ........ .. ...................... .. ......... , ... ..... .. ........ ,.. .. .. .. 27

8 Legislated law and the effectiveness of legal precedent.. ......................... , ...... " .. .... ...... 28

9 The non-application of the "common law - statutory law" dichotomy .. ,.. .. .. , ........ .. .. 28

10 The existence of an "Administrative Law" ....... ,....................... .. . ....................... " . .. 29

11 The capitalist regime and free enterprise .. .. .. "" ... ",.... ,, 29 12 The undertaking of economic activi ty by the government "", .. " .... ,.. , .. 29 13 The existence of public monopolies .... "",,,,, .... ,, .... , ........... " .... " , .. " " ..""." "" ... ,.. "." ..... 30 14 The existence of public services .......... ", .. ",,, .. ,,,,, .... ,, .......... " "." "." .. , " " ,,".... ...... . .30 15 The delegation of public services to the private sectof.."." .. " .",,, .. ,, .. , "" "."" .. " .......... 31 16 The independent regulatory agencies """, .... . .. """, .... " .. 32 17 Contracts between the State and the priva te sector.. ....... "". """ " .. ".. ... .. ... 32 18 The necessity of public procurement ................................ " ........ """." ,,,,, ... ,, .. ,,, ... ,, ....... 33

19 The Union's legisla ti ve power to regulate public procurement ." " ....... ,,, .. .,, .... ,,.,, ..... 34

CONTROL OF THE INDEPENDENT REGULATORY AGENCIES

Alexandre Wagner Nester ." .. ,.. """,,, .. ,.. ,,.. .. .... ", .. """,,,,, .. ,, , ..... "" .. ""." .. ,.. , ..... 35

1 Introduction: the paradigm shift of the State's economic activity"""" " .. . .... 35

2 The independent regulatory agencies, their ch aracteristics and political autonomy., ... "............................ . ..... ,.. " ......... ....... , ..... , .......... , .. " . ., ... 38

3 The control over the independent regulatory agencies' activities. ...... . . ...... 40

3.1 Social contro! ............................................................. ............................... ... ... ... ... ... . .......... 40

3.2 Political control ............................................................ .. ....... .......................... ....... .... 41

3.3 Economic and financiaI control ............ . ... .... ...... .. .... ......... ...... ......... ....... .... .42

3.4 Control through management contracts ............ .. ........ ... ...... ... .............. .... .......... ......... .... 42

3.5 Control resulting from due legal process ..... ....... .... ......... .. ........... .... .... .. ......................... 43

3.6 The Public Ministry control .......... ...... ...... ........... .... ... ......... .. ... ..... ......... ... .. ............. 43

3.7 Judicial review .. .. ... 43

4 Conclusion .......... ...... .......... .. ... ... ..... .... ...... ........... ... .. ..... ... ... ... ..... . ...... .. .... ... ................. 45

ADMINISTRATIVE PROCEDURE AND T H E INDEPENDENT

REGULATORY AGENCIES

André Guskow Cardoso ........... ... .. ......... .... ... ......................... .... ........... . .... ... ...... ... . ...... 47

1 Introduction......... ................. .. ................................... ............... ... .. ...... 47

1.1 The emergence of independent regulatory agencies in Brazilian law .......................... 47

1.2 The independent agencies introduced in Brazi lian !aw and the regu!ated sectors .... 48

1.3 The concentration of State powers under the independent regulatory agencies........ 49

2 The growing submission of State activity to procedural forms ..................................... 49

2.1 Procedure as a means to control Public Administration activi ty ................. ...... ......... 49

2.2 Procedure as a means to ensure broad participation of those who will be affected by Public Administration performance ......... ... ........................................................... 50

3 The role of Brazilian independent regulatory agencies.. . ................. ................ .. ...... 50

3.1 The different forms of performance of the independent regulatory agencies.. .. .. 50

3.1.1 Enforcement of regulatory rules ........... ...... ........... .... ........... ....... ......... 50

3.1.2 Rulemaking ..... .. ... .. .... .. ............ .. ..................... ........... 51

3.1.3 Adjudication ..... ........... ..... .. ............. 51

3.2 Consequences on the administrative procedure to be adopted ... .......... .. ...... .. ...... 52

4 Administrative procedure and inde pendent regulatory agencies .............. .. ...... .. ....... 52 4.1 Constitutional provisions ........... . .......... ........ ........... 52 4.2 Law n . 9.784/1999 provisions .... .. ............................... ............... ........ .... . 52

4.3 The various provisions in the agencies' internaI acts ..... .. ....... ...... ...53

4.4 Common notes to the administra tive procedure in the major independent regul atory agencies ...................... .. ........ ......... ....... ........... ......... ...... ............... 53

4.4.1 Rulemaking procedure ..... . ....................................... .. ......... .. ............ ...... ............. 54

4.4.2 The administra tive procedure for imposing sanctions ..... .. ............... ....... .. .. .. .. . ..... 55

4.4.3 Administrative procedure for dispute resolution ...... .. .. 56

4.4.4 The administrative procedure for adjudication ........ .. ........ .............. .. ............ .. .. . .... 57

RULEMAKI N G POWER OF I NDEPENDENT REGULATORY AGENCIES

IN BRAZIL

Diogo Albaneze Gomes Ribeiro ... 59

1 Independent regulatory agencies .................. . ..... ........ ... .. ... . ... 59

2 The regulatory competence in the Brazilian law ..................................... .. ..60

3 The regulatory competence Df the independent regulatory agencies in Brazili an law.............. .............................. ................. .... . 61

4 Examples of rulemaking activity of independent regulatory agencies .. .............. ...... 63

..

tcies' activities .. . .............. 40 .................... ........... ... .. ... ... ... ... ........ 40

............ ..... .... .... .. ...... ..... ............. ...... 41

.. .......... .. .... .......... .. .... .. ... ... ... ... ... ....... 42

... .... ....... .... ............ ... .. .. ...... ..... .......... 42

.............. ..... ................ ....... ............... 43

......................... ............ ... ... .............. 43

........... ........ ..... .......... ...... ... ... .......... 43

.... ....... ............. .. ..... .............. ... ........ 45

ENDENT

.......... ..... ............ .... .. ... .. ..... .............. 47

....... ... ............. ..... ........ .... ... .............. 47

!s in Brazilian law ........................ .47

lawand the regulated sectors ... 48

,endent regulatory agencies ...... . 49

duraI forms ................................ .. 49

ation activity ............................... .49

..................... ................................... 50 ,n of those who wiII be affected

cies ................................................. 50

ldent regulatory agencies ........... 50

...................... 50

.... 51

... 51 be adopted ..... ..... . 52

ltory agencies ..................... ........ 52

52 ................ .. ...... .... ................ ........... 52

:5 ....................... . ... 53 the major independent ..... ................... .· ........................... 53

...... ............ .... . . ...... 54

.ns......... .. . .... 55

.... 56 .... ........ .... .... .... .... ....... ......... ........... 57

~TORY AGENCIES

.......... ... ............ ........ ... ................ 59

.......... 59

... 60 ulatory agencies in

......... 61 gulatory agencies. ... ......... . ..63

5 The limits of the rulemaking power of independent regulatory agencies in di fferent sectors...................................... ............................................................................. 64

6 The controI of the reguIatory agencies normative acts ...... ................... ........ ................. 65

6.1 The Judiciary's control ....................... .......................... ...... ... ... ..... .. .... ..... ........ ...... ........... 65

6.2 The control through the legi sla tive power.. ..... ... .. ........... .................................... ......... .. 66

7 The conflict between the norms of independent regulatory agencies with those oi other agencies or sectors ....... ... .. ................................................................... ................ 66

COMPETITION LAW ENFORCEMENT IN REGULATED SECTORS

Marçal Justen Neto ...................................................................................................... .............. 69

1 Introduction...... . . ................................................................................. ...... ... .......... 69

2 Competition law enforcement by independent regulatory agencies .......... ... ... .. ......... 70

3 Competition law enforcement by an títru s t authorities ... .................. ............ ........ . ...... 71

4 Limits and exemptions from competition law enforcement in regulated sectors ................ . ......................................... ... ... ... ........... . ...... 72

5 Competition law enforcement in regulated sectors .............. ... ........ ........... .......... .. . 72

5.1 Telecommunications .......... . . .... . 73

5.2 Electrici ty .............. ......... . .73

5.3 Oi!, gas and biofuels........ .. ........... ........ ...... ....... .. ........... ... ........ .... 74

5.4 Health...... ................... .......... .. ........... ... ........ .............. . ......... .............. ... ... ............... 74

5.5 Transportation ............ . ..... 74

5.6 Civil aviation .. . ... 75

5.7 Banking ... . ... ........... ... ...... 75

6 Publi c procurement and competition ......... ..... ... ........ . . ... . ... .. ......... 76

PUBLIC PROCUREM ENT : G ENERAL RULES

Cesar A. Guimarães Pereira ......... . . ................................. ... ... ... .. ... . .............. ... ............. .... 77

1 Constitutional basis ..... . .. ,77

2 Applicable ruIes ................. . .. ............................... 80

3 Auditing bodies: the importance of TCU. .. ...... ... ... ... ....... ,80

4 Coverage ...................... ........... ....... . ., .. ,.. 81

5 PrincipIes and purposes .................. . . ............. . .. 81

6 Methods, thresholds and publicity ....... 83

7 Single-source procurement: direcr award. ..... 85

8 Types of bidding: evaluation criteria ........ . ....... 85

9 Standard procedure (sealed competi tive bidding) .... , .. .... ..... 86

10 Qualification phase....... . .............. ..... .......... . ... ... .. . ..... 87

11 Evaluation Uudgment) phase ...... ............... ....... ......... .. ....... . . ..... 88

12 Award and execution of the contract ................... ... ... ............. . ...,.89

13 Fraud and penaIties . .......... .. ..... ... 90

14 Specific ropics ....... .. ............ 90

14.1 Purchases and price registration ... .... ........ . ... ..... .. .... .... .. ...... ..... .. ....... ..90

14.2 Pre-qualification (shortlist stage) ................... . ..................................... .... .. ...... .......... 91

14.3 Small companies (CompIementary Law n. 123/2006) ................ .. .. .. ........ ...... ............ ..... 91

14.4 Biddings for the 2016 Rio Olympics ................ . ............. .. ...... . ' .. .. .. ...... ................... 91

14.5 "Buy national" (PPM n. 495) .................... ............. , ... ... ....................................................... 92

4.2 REVERSE AUCTION AS A METHOD OF PUBLIC PROCUREMENT

Ana Lucia Ikenaga, Mayara Ruski Augusto Sá, Thalita Bizerril Duleba Mendes ............. 95 1 2

3 4 5

6 6.1 6.2 6.3

6.3.1 6.3.2 6.3.3 6.3.4

6.3.5 6.3.6 6.3.7 6.3.8

6.3 .9 6.310 6.3.11 6.3.12

6.4 7 7.1 7.2

7.3 7.4 7.4.1 7.4.2 7.43 7.5

8 9 9.1

9.2

4.2

Outline of the reverse auction (pregão) ............. .. ............................................................... 96 5

Applicability ......................................................... ............................................................. 97 5.1

Application of general mies of public procurement.. ..................... .. .............................. 98 5.:

Types of reverse auction ...................... .. ................ ... ........ .. .. ... ........... .. ............. 100 5.: Procedure of the common reverse auction .................................. .. ............... .. .............. 101

lntroduction................................. . ............................................................ 95

6

The role of government offjcial....... ........... .... .... .... .. ... . ................... .. ...... ....... ......... 101 7

Invitation for bids .. .... .... ... ...... .. ...... .. ... ..... .. .. ..... .. .. . ............... .. .... 101 Public session ................. ..... ...... .. ..... .... . .. ... .... .. .................. 102 T Registration .. ......... ......... ......... .. .. ......... ......... .... .. ..... .. .... .... ... ....... 102 B Dec1aration of knowledge ........ .. ........ .. .......... ..... .. .. ........ .. .. ..... .. ......... .. ....... 102 VI Envelopes.............. .... .............. .... .... ............................. ................................................ 102

Opening of proposal envelopes first ranking .............. .. The minutes of the auction ....... . Bidding phase ............................ .. ...

Second temporary ranking .. Judging the bidders qualification ........... .. .. Presentation of samples and their evaJuation Disqualification ......... ......... ..

Final ranking of the bids.

1 .. .. ........................... .. .. .. ......... 103 2

.. ............... 103 . ....................................... 103 3

.... ..... 103 ...... 104 4

. ..... .... .... .... ....... ........ ... ................... ........ 105 5 ........................................ ... ........ 106

.. ....... .. ........ .. ............... . 106 6 ... ... ........... ... ........ ................ .. .. ..... 106

Administralive appeal or protest ............... ... ...... .. ........ ... .. .. ..... ... ........ .. ..... ........... .. ...... 106 I Procedure in online reverse auction .................... ... .............. ................... 107 I Registration ............. ..... . .................. .. .. .... .. ..... ... ....... ..... ... ........ .. ... ......... 107 1 lnvitation for bids ................ ..

Submission of proposals .............. .. .. .. Virtual public session ...... . Bidding phase ........................... .. .... .. .... .. Disconnections ............................ ........ . .. Ending the bidding phase ........................ Appeals or protests .. . ...... ................

The participation of international bidders.

. ..... .. ...................... 108 .. .. .... .. ................. . .... 108

..... 109 ..... .. ...................... . . ..................... 109

... .... .. .. ... .. ......... 110

. ............. .. ......... 110 .. ........... 111

. ............. .. .................................... 111 The advantages and disadvantages of reverse auction .................................... ..... ...... 112 Advantages of reverse auction ....... .. ... ... ................................... 113

Disadvantages of reverse auction ..... .. ............. ... .... .... ... .. ......... ........... .. ....... .. ........... .113

PUBLIC PROCUREMENT FINANCED BY I N T ERNATIONAL AGENCIES

IN BRAZIL

Rafael Wallbach Schwind ................. ..... . .................................. .. ............. ... ........ 115 1 Introduction......................... . ........ ... ................. .. ....... ........... .. ........ .. ....... 115 2 The importance of this issue .... .. .............. ............................... .. .. 116 3 The regime under Law n. 8.666........ ............................ ...... ....................... .. .......... 117

4 The prerequisites for the application of arliele 42, 5th paragraph, Law n. 8.666 ....... 117 4.1 First prerequisite: existence of funds necessarily of foreign origin ............................ 117

ROCUREMENT

lJizerril Duleba Mendes ...... ...... . 95

·.. ·.... ·· .... ·.... ········ .. ···· .. · ............... ...... 95 ·...... ·.. ·· ..····· .... ·.. ··· .. ·· .· .... ... ... ... ......... 96

·...... ·.... ·.... ·· .. .... ·.. ·· ... ....... ........ ......... 97 t... .... ·· .. ·....................... .. 98

.......... 100

.... ·· ·· ...... ··· .. ·.... ····· .......................... 101

·.. .... ·· ...... ·.. ···· .. ·· .. ··.· ....................... 101 ... ....... ... ... .. .. ...... .. ....... ............. ...... 101

.... ... 102

... ..... 102

..... 102 .. ...... .. ........................................... 102

.. ......... 103 .. ·.. .. ·.. .. ·.... ·· ... .. ...... .. ..... ... .. ............ 103 .................... ............ ........... .......... 103

······ ·. ··· ·· ... ... ............. ...... ....... 103 .. ·.. ·.... ·.. .. ·.. ·.... ·.. ·.. ··· .. ·.. ·.... ........... . 104 ....... .. ........ ........ .. .......... ........ .. ...... 105 .................................. .. ............... 106

..... 106 .. · ...... ·· .. .. ·.. ·· .. ... ... ·... .. ...... .............. 106

·.... ...... ·.... ····· ··········· .. ·· ... ........... .... 106 .... ··· .. ·.... ·.... ·· ........ .... .. .... ... ... ........ 107 .......... ······ .. ·· ......... ....................... 107 .... ·.... · ...... ·· .. ·· .. ·.... ................ ...... . 108

.... 108

109 .......... ............. " .... . ..... .... .. ... ....... 109 ......................... .. ..... .... ................ 110

·...... ·· .... ·· ·.... ·.. .... . .................. 110 ................ .......................... ......... 111

............ .............. ..... ... ............ .. ... 111

)n.... ·· ... .. .. . ........ ... ...... .................. 112 ........ ............ .. .. .... ....... ............ 113 .......... ..... ....... .. .......... ....... ........... 113

[ONAL ACENCIES

.. .... .. .. ....... · ....... .. ...... ..... .. .... ........ 115

.. ·.. ·· .... · ...... ·.. .. ·.... . .................. 115

·· .... ·.. ·.. . · .. ... · ............ .............. ...... 116 ........... ... " ....... " .......... " ............. 117

paragraph, Law n. 8.666........ 117 oreign origin........... ........... ...... 117

4.2 Second prerequisite: imposition of removal oi Brazilian law as a condition for granting or donating funds ....................................................................................... 118

4.3 Obligation of demonstrating the presence of the two prerequisites ................... ........ 118

5 The content of modifications that can be admitted ............................................... ..... ... 119 5.1 Obligation to respect the fundamen tal principIes of public procurement ........ .. ...... 119 5.2 Objective definition of the ruies that wiU guide the bidding ........................ ..... .......... 120

5.3 Case studies .............. ............... ...................... ............. ...................... .. ... ......................... ... .. )20

6 The effective participation of the international agency ............. .................. .......... ....... 121 7 Specific ruies ..................................................................................... .. ...... .... .... .. ............... 122

THE SYSTEM OF PROTESTS AND ApPEALS IN BRAZILIAN PUBLIC

BIDDINGS LAW

William Romero ............. .. .. . ........ ......... . ..... .. ... ..................... .. .... ..... .......................... .................. 123 1 Tntroduction................... . ......................................................................................... 123 2 The challenge to the lnvitation for Bids (IFB): article 41, 1st and 2nd paragraphs,

Law n. 8.666....... .................................................. ............ . .. 124 3 Appeals to be brought by bidders against decisions made during the bidding

procedure: article 109, I, Law n. 8.666........ ................. .. ...... .125

4 Representation to the Court of Accounts: article 113, }" paragraph, Law n. 8.666.. 127 5 Protests under the basic policy on procurement and contracting of lDB

(lnter-American Development Bank) and of IBRD (World Bank)................. ...128 6 Conclusion.. ....... ..... .... .......... ....... ......... ..... .. .......... ..... .. ................................... 129

PUBLIC PROCUREMENT BY S TATE GOVE RNMENTS

Dina Oliveira de Castro Alves .. .. .... ... ........ 131

1 The Federative Republic of Brazil: vertical division of the legisla tive competence ........... ................... ................. ............. .................... .............. ................. ....... 131

2 Concurrent competences in public biddings and administrative contracts ...... ....... 133

2.1 The scope of the term general rules ....................................................................... .... .... 134

2.2 The supplementary competence of the States .... ...................... . ........ ........... .... ...... 136

3 The State exercise of supplementary competence: case studies ........ ....... ................... 136 4 Conclusion.... ... .......... ... . ........... .......... .................... ... .... .............. 138

GOVERNMENT CONTRACTS IN BRAZILIAl\: LAW

Aline Lícia Klein, Guilherme Fredherico Dias Reisdorfer, Karlin Olbertz .... .. .. 141

1 Introduction................. . .................. .......... ............................................................... 142

2 Public contracts and private contracts ............................................................ 142 2.1 Public contracts and private contracts under Brazilian la w...... .. .................. .. .. . .. 142 2.2 The scope of govemment contracts ............................................. ....... ... .... .. ...... .. .... ....... 143 2.3 Administrative contracts ..... . ........ .................. .......... ....... .. ... ..... ..................... 145

3 The creation of the administrati ve contract ......... .. ... .......... .... ............. .. .... .... .. .. .... ......... 147

3.1 Planning the contract ................ ... . ................................... ......... .... .. ...... ....... .......... 147

3.2 Choosing the most advan tageous con tract.. .... .. .... ... .. ................................................... 147 3.3 The contract's formalities and content.. .............. .. ........ .. ............ ... ......................... 148

4 The State's powers and the privare party's rights in the performance of government contracts ............................................................ ............................................ 148

The basic benchrnarks of the contract's execution ............... ......................... ...... ... ........ 148 The administrative contract's system of execution ........................................................ 149 The execution of private law contracts ................................................. .. ......................... 149

(govemed by public law) .................................................................. .. ... ....... .. .... .. ............ 150 4.2.2.1 Unilateral modification of the contract (jus variandi) ...... ............ .. ......... .. .......... .. ......... 150 4.2.2.2 Supervision and sanctioning of the contracted private party ...................................... 152 4.2.2.3 The temporary provisional overtaking of human and material resources ................ 153 4.2.2.4 Stay on the contract's execution.................................... ........ .................................. .. .. ...... l54

The possibility of subcontracting and the assignment of contract.. ............................ 154 Reception of the contracted object and the private party's liability ............................ 155 The guarantee of the economic-financial balance of administra tive contracts ......... 155 The guarantee's legal provision .................................. .......... .................................... ........ 156 The moment in which the relation between costs and benefits is established .......... 156 Prerequisites of the right to restore the contract's balance ........................................... 156 The lack of discretion in rebalancing the contract's equation .... .. .......... ..... ..... .... ........ 156 The extension of the restoration of the balance.............................................................. 157 Mechanisms for the restoration of the economic-financial balance .......... .... .............. 157 Termination of administrative contracts ........................................ ........ ...... .. ................. 157

................ ........ ... ....... ...... ........ .. ... .. ............. ............... 157 Abnormal termination ............ ........ ............. ...... ........ ........ ....................... .. ...... ..... ........... 157 Causes that lead to the contract's rescission ..................................... ... ......... ..... .. ........... 157

6.2.1.1 Rescission due to reasons attributed to the private contractor ............ .. ... ................... 158 6.2.1.2 Rescission due to reasons attributed to the Administration .. .................... ..... ..... ........ 158 6.2.1.3 Rescission due to reasons not attributable to any of the parties............ ................ .. .... 158

.. .................................... .. ... .......... ..... 158 6.2 .2.1 Rescission due to the Administration's unilateral act .............. .. ...... .. .. .. ........ .. ........ ..... 158

.. ................... .. ................................. 158 .. ....... .. ....... .......... ...... .................. 159

...... .. .... .. ...... ......... ...... ... 159 .. .................................... ..... .. ........... 159

Damages award due to the contract's rescission ................................... .. ......... .. .. ... ....... 160 .. .... .... .............................. .. .... .. .................. 160

.................................................................. .. .................................. 163 Introduction............................................. .. ........... ..... ... ..... ...... ........... ... .. ......................... 163 Adminis trative law in Brazil... .......... ..... .... .............. .. .... ... .. ............. .... .......... .. .. .. .......... ... 163 Public services ........................................................................................................... .. ..... 164 Direct and indirect provision of public services ............ ....... .. .. ................ ..................... 165

. ....... .............. .... ........ .. .................... .. .......... .... ....... 166 Concession of public services as one of many forms of service provision ................ 166 Features of the concession agreement ........................................................................... 167

.. ............................. .. .................. .... ............ .. ..... ......... 168 Prior public bidding ........... .. ...... .. ... ... ...... .. ............. ................... ........ .. .. .......... .. .. ... ........... 169 Adequate service ................................................................................................... .. ........ 171 Allocation of risk and protection of the economic and financiai balance ...... ..... ....... 171

4.1 4.2 4.2 .1 4.2.2 The execution of administra tive contracts in the strict sense

4.2.3 4.2.4 5 5.1 5.2 5.3 5.4 5.5 5.6 6 6.1 Normal termination .......... 6.2 6.2.1

6.2.2 Types of rescission..................

6.2.2.2 Out of court rescission .. ..................... 6.2.2.3 Judicial rescission. 6.2.2.4 Rescission by the resolve of bodies of control 6.2.3 The need for a due administra tive procedure.. 6.2.4 6.2.5 The contract's annulment .. .......

CONCESSIONS OF PUBLl C SERVICE

Cesar A. Guimarães Pereira

1.1 1.2 1.3 1.4 Concessions and PPP ...... 2 3 4 A trilaterallegal bond ....... 5 6 7

...... ·· .... ·········· ········ ... .... .... ..... ........... 148 ............. ............. ............. ... ... ........... 149 ... .... ... ... ............... .......... ...... ... ... ....... 149 trict sense

......... ...... ........ .. .. ....... .... . 0.0157

.... ................ ......... ....... ..................... 150 ti) ... .... ..... ...... ............. ... .................. 150

vate party ...................................... 152

and material resources ...... .......... 153 .................... .... ................................ 154

lent of contract.. ................ ............ 154

party's liability ............................ 155 )f administra tive contracts ......... 155

·· .. ···················· ··· ............................ 156 md benefíts is established ......... 156 ,alance ................................ ... .. ..... 156 ; equation .............. ...................... 156 ....................................... ... ......... .... 157

nancial balance ...... .... .. .. ............. 157 ....... .. ........................ ....... ... .. .... 157

................ ............... ... ....... ..... ........ 157

.. ·.. ······ .. ··········· .... .. .. . · .... .... ...... ....... 157 contractor ...... .. ......... ... ....... ......... 158 istration ............... .......... ... ............ 158

f the parties ............. ....... . ......... 158

.. 158 ct ......... .. . ............................... 158 ................................. .... ... ........ ...... 158 ......... .. ........... .. ................ .. ... .. ....... 159

..... 159

... 159 ... ..... .................. .... .. , .. 160

.... 160

·· .. ·········· ... .. ... ...... ............ 163

·· .. ··· ··· ···· .· .. .... .... .. ..... ...... 163

...... 163 .. . .......... ...... 164

...... 165 ....... ...................................... . , ..... 166 ; of service provision ............... 166

........ .. ... .... 167 ..... ... ..... ............... .... .... .. ...... ....... . 168

.......................... .. .. ...... ... ....... 169

.... " ................................. ............ 171

1d financiai balance ................. 171

8 Remuneration of the concessionaire ..................... ...................... ..... ... ............ ... .............. 174

9 Reversible assets ....... .................................. ........... ........ .... ... ............................ ................. 175

10 End of the concession ................ ..... ... ........... .. ......... .. .... ................ .. ....... . .................... 175

11 Arbitration ....... .... .... ...... ..... .. ... .. .. ... ..... ....... .. ... ........................... ..... ................ .......... ......... 176

PUBLIC-PRIVATE PARTNERSHIPS (PPP) IN BRAZIL

Fernão ]usten de Oliveira ...... .. ......................................... ......... ............. .. .................... 177

1 lntroduction..................................................................... ...... ........................................... 177

2 The modalities of the Brazilian PPP............ ....................... ... .. ... .. ...... ....... 178

3 The legal feasibility of the PPP: the requirements of the Brazilian law ...................... 179

4 The economic feasibility of the PPP: the attractiveness of the project.. ...................... 181 5 The remuneration of the PPP concessionaire ............................................. ... ... ............ 182

6 The special guarantees for the PPP concessionaire ........ .... .. .. ....... .... .. .......... .. ... .......... 183

7 Arbitration in the Brazilian PPP ....................................... .. ... .. .. ... .................... .. ... ..... 184 8 Conclusion............ . ....... .. ...... .. ........................... ................... .. ... .... ........ .. ... ..... 185

ENFORCEMENT OF PECUNIARY CREDITS AGAINST STATE PARTIES

Eduardo Talamini ..... .... 187

1 Constitutional regulation .............. .. .............................. .. ... ...... 187

1.1 Sequence of preference . .. ......... .. ........ ............. .. .. .. ....... 188

1.2 Seizure ....... .. ............. ...... ... ................................ .. ....... 188

1.3 Credits of alimonious nature .. ............... .. ......... .. ............ .. .... .................... 189

1.4 Moment of payment and monetary correction ......................... .. ......... .. ... .................. 190

1.5 Credit of "small amount": dispense from precatory writ ....... ....... .. ........................... 191

1.6 Offset by credits withheld by the debtor PubJic Treasury ....................... .. ................. . 192

1.7 The use of precatory writs to acquire real property ..... ......... ........ ........ .. ... ... ... .. ....... 194

1.8 Credit assignment..... ................ . .. ......... .. ....... .. .......... .. .............. 195

1.9 Debt assumption by the Federal Govemment ........................... .. 195

2 Instruments that enabJe enforcement against the Public Treasury .. 196

3 Non-feasibiJity of provisional enforcement.............. .. ...... ..... .. .. .. 197

4 Procedure... ................... .... ... ..... ................ .. .... .. .. .... .. .... .. ......... .... .. .. ... ..197

4.1 Bringing suit ............ .. .. . ....... .... .......... .... .. .... 197

4.2 Service of process .... ... ......... ..... .. ......... .. ............. .. .. .. ... ... ... ........ 198

4.3 Motions to stay enforcement ......... .. ............. .. .. .. ............ ........ 198

4.4 Request for payment.. ... ....... ..... ............. .. .................. .. .... .. .. .................... 199

4.5 Payment .............. ............... .... ... ............. ..............................................................200

5 The apportionment imposed by article 78 of the Temporary Constitutional Provisions Act - TCPA (Constitutional Amendment n. 30/2000) ............................ ... 200

6 The special regulation of precatory writs (article 100, 15th paragraph, FC; and article 97, TCPA - CA n. 62/2009) ...................................................................... ......... .. 202

6.1 Description of the regulation provisioned in the article 97, TCPA .................. .. ... . .203

6.2 Uncons titutionality of the spec ial regulation.. .. ........................... .. .................... 206

BRAZIL IN THE CONTEXT OF INTERNATIONAL ARBITRATION

Mauricio Comm Santos, Quinn Smith ....................................................... .. .207 1 Dramatic changes in short order: the recent history of arbitration in Brazil .. ... .. .. 208

2 Passage and adoption of new arbitration laws: Brazil sets the stage for the REC( growth of arbitration ..................................... ......................... ... ............................. ... ...... 209 Cesar

3 Increased judicial acceptance of arbitration: the rise of the STJ. .......................... ...... .. 210 1 3.1 Review of STJ decisions on private commercial matters ............................ ........ .......... 211 2 3.2 Analysis of decisions involving sta te-owned entities .................... ,., .. , ... , .... , .... , ........... 213 3 3.3 Summary of court attitudes towards arbitratíon ........................................................... 215 4 3.4 The effect of the STJ's current jurisprudence .................................................................. 215 4.1 4 Development of competent and reliable regional institutions: arbitration takes 4.2

hold for domestíc matters and begins to spread intemationally................................. 216 4.3 5 Growing expertise: Brazil's practitioners, scholars, arbitrators, and students join 5

the international club .... ,.,., ........ ,." .. ' ...... ,." ........ ... "., .......... ,., .... , ..... , .. ,., ... ,.. ,.,.,'., .... ,., ... .', 217 6 6 lntemational recognition and assertion of power: gaining the attention of the 6.1

world and making a statement internationally ................................... ................. 218 6.2 7 Conclusion , ...................... , ..... ....... , , .. , ....... , .. ,.... ,., .. , ......................... . , ....................... .. ,.".,.219 6.2.1

6.2.2 ARBITRATION IN BRAZIL 7 Felipe Scripes Wladeck, Paulo Osternack Amaral ... ,... .. .. ...... .. ................................ 221 7.1 1 Arbitration... ' ....... ,..... .. .... .. ............ ............. 221 7.2 1.1 Initial considerations ......... . ........................................ .. ....... .. , .... ........ ...... ..... ............ ...... 221 7.3 1.2 Arbitrability................. .... ... . ......... .. ..... .. ............. ........ 222 7.4 1.21 Objective requirements .. .. ., ., .. , ... ", ." .... ,.. ".. . " .. ,."".,.222 7.5 1.2,2 Subjective requirements ......... . ............. . ,.. .. ....................... 222

2 How to establish arbitration in Brazil " , .. , .... , .... ,. ,... ,." .' .. '"., .. ... .. """., .. ,'.""",." .. ,,223

2.1 Submission agreement and arb itration clause ......................................... 223 2.2 The sufficiency of the arbitration clause and its specific execution ......... , ................. 223

2.3 The courts' position on the sufficiency of the arbitration clause ..... .. , .... ....... 225

2.4 The arbitration cJause's autonomy .. ..

3 The arbitrators.. .. ... .. ....... . 3,1 Equivalence between arbitrators and State judges 3.2 Relation between arbitrators and State judges ...... , 3.3 The arbitrator's appointment...........

3.4 The arbitrator's duties.......... ...............

4 Arbitration in administrative contracts...... 4.1 Application and legal authorization 4,2 Procedural aspects........... 4.3 Limits: respect to publicity and legal ity..

. .... , .. ................. 225 BRAZ

. . ..... ,226 LAW

........... .......... ............ ...... 226 PPM .... '.. .... .. .... ' ........ 226

.., .......... 227 LAW

.. ...... .. ............ .. ..... 227 LAW

. ............ 228 LAW ..................... , . .......... 228

.. .... ........ .. .... .. ....... .... .. ........ 228 LAW

,................ .. .... ' 229 COD: 4,4 The legisla tive and case law incJination: the su itability of arbitration to solve

LAW disputes stemmed from administrative contracts ................... .. ........................... 229

5 The arbi tral procedure .......... ' ................. .. .............. .. , ............. , ..... .. ........ 230 REsc

6 The arbitral award and the means for its review ........................................ .. .. ............. 231 6.1 The structure, effects and autonomy of the arbitral award ............... . ........ 231 6.2 The application of appeal requesting the clarification of the arbitral award ............ 232 6,3 The judicial review of the arbitral award... . ...... ....... .......... 232 6.3,1 Judicial review of foreign arbitral awards.. .., ......... 232 BRA; 6,3,2 Judicia l review of national arbitral awards .... .. ................................... 233 6.3,3 The courts' current inclination: the respect for arbitration... .. .................... .. ...... 234

GLO7 Brazil's adoption of the New Yo rk Convention ........................ .. ............ .. ..................... 234

I

'azil sets the stage for the ......... ...... ......................................... 209

.se of the STJ.................................. 210 latters

arbitrators, and students join

................. .. ........... .... .. .. ........ 211

ies ....................... ........... ..... ............ 213 ....................................................... 215

.... ·...... ·.... ··· .......... · ........................... 215 institutions: arbitration takes Itemationally..... ............................ 216

........ ... .............. ......... . ...... 217

gaining the attention of the ... ..................... ... ·· .......................... 218

........ ··· ...... ·.. ·..... ·· ...... .... .. .... ............ 219

.... ......... ......... ..... .... ... ......... 221

.............. .. .. ....... ......... .................... 221

............ ·· .. ·· .... ·· .. ·· ... .. ..... .. .... .. ......... 221

............ .. ....... . ·· .. · ........... ...... ... .. ..... 222

.... .. ...... .......... . ·· .·· ........... ... ... ......... 222

...... ·.. ··· ...... ·.. ······ ....... ......... .. .. ........ 222

.. ·.... ·...... ·.. ·· .. .. ·.·· ........ .................... 223

·...... ·.. ·.. ······· .. ···· ............................ . 223 !cific execution ......... ... ............... 223 'ation clause ........... ............. ........ 225

··········· ·· ... .. ..... .. .... ....... ....... 225 .. .... ·.... ·.... ·· .. ·.··· ........... .. ................. 226

....·.. ·.. ··· ..··· .. ·· ....... ·.. ... ........ .. .......... 226 .................. . ................... .. ............. 226 ................... .. ................................ 227 ........... ..... ........... .......... ....... -.. ..... 227

........ ....................... .. ........... ...... ,.228

·..· ........ ·.. ·.... ·· .. ·... ·... .... .. ..... ......... .. 228 .......... .......... ...... ....... .. ........ .. ........ 228

... 229 Jity of arbitration to solve .. ·· .. ··· .. ·· .. ·· ......... ··· ......................... 229 ·· ........ .. .. .. · ......... .... ....................... 230 .......... ... .... ... .... ... ......... .. ..... ... ....... 231 award ......................................... 231 In of the arbitra l award ............ 232

............. 232

... .232 ................. .... ........ ... .. .... ..... ......... 233 :ation....... .. ............... .. .. .. .. ......... 234

····· .·...... .. ....... .. .. ... .......... 234

RECOGNITION OF FOREIGN JUDGMENTS AND AWARDS

Cesar A. Guimarães Pereira ...................................................................................................... 237 1 Legal environment ........ .. ....... .. .... ............. .................... .... .......... . ...... .................. ............. 237 2 Arbitral awards..................... ........................... .......... .. ................................... 238 3 Enforcement of judgments and arbitral awards ...... .. ......... .. .......................... ........... 241 4 Enforcement of domestic awards........... ................. .. ........ .. ................................. 243 4.1 Competent cou rt ........................................... ..... ... ... ... ....................................................... 243 4.2 Procedure (highlights) ................... ........ ........ .. ... .............................................................. 244 4.3 Grounds for objecting enforcement ............................................ .. ..... ... ... ... ..................... 244 5 Legal definition of an intemational arbitral award ....... ....... .... ............ ..... .. ... .. ............. 245 6 Recognition of intemational awards ..................... .......... ............... ..... .. ...... .. .. .. ... ... ... ..... 246 6.1 Constitutional requirement. .................................................... ... ...... .. ............... ... ............. 246 6.2 Procedure ....................... ... .......................................................... ............................... ... ....... 247

6.2.1 Requirements to grant recognition ................... ... .. ....... ................ .................................. 247 6.2.2 Grounds to deny recognition ..................... .... .. .. .... ...... ...... .. ......... ................... ............ ..... 247 7 Enforcement of recognized awards ................................ .......... .. ............... .. .. .... .............. 249 7.1 Competent local federal court ............... .. ........................ .............. .. ........................ ......... 249 7.2 Pre-enforcement measures ............................................................................. .. .... ... .. ....... 249

7.3 Disputes conceming the legal status of a recognized award .......... ... .. ....... .. ..... .......... 250 7.4 Consequence: latitude of the grounds to object enforcement. ..................................... 250 7.5 Analysis of the case law ... .. ..................................................... ... ........ ................... 251

PART II

BILINGUAL VERSIONS OF RELEVANT STATUTES

BRAZ1LlAN FEDE RAL CONSTlTUTlO N - E XCERPTS ......................................... .. ..... . .. . ....... .. .............. 255

LAW N. 8.666/1993 (BlDDINGS AND GOVERNMENT CONTRACTS) .................................................... 267

PPM N. 495/2010 ("5u\' NATIONAL" PREFER ENCES IN BlDDINGS) - EXCERPT ............. ................... 339

LAW N. 10.520/2002 (REVERSE AUCTION) .......................................... . ........................................... 343

LAW N. 8.987/1995 (CONCESSIONS OF PUBLlC SERVlCES) .............................. . ...... .......... ....... ........ 349

LAW N. 9.074/1995 (CONCESSIONS OF rUDLlC SERV ICES) - EXCERPTS .............. ............. .. ........ . ..... 369

LAW N. 11.079/2004 (PUBLlC-PRIVATE PARTN ERSHIPS - PPP) - EXCERPTS ...... .. ........... ... .. .. ........... 375

CODE OF CIVIL PROCEDURE OF 1973 - EXCERPTS ........ .. ...... ...... ........... .... .......... .. .... .......... .. . .. ........ 389

LAW N. 9.307/1996 (ARBITRATlON) .... ....... ...... .............. .. .... 393

RESOLUTlON STJ N. 9/2005 (RECOG 'lTlO N OF FOREIGN JUDGMENTS) .. 405

PART III

ADDITIONAL R EFERENCE MATERIAL

BRAZILlAN LEGISLATION RELATl NG TO GOVE RN MENT INFRASTRucrURE CONTRAcrS AND PROJEcrS ...411

BRAZILIAN INFRASTRUCTURE LAW REFER ENCE WEBSITES ...... ...... ................................. . .. . ............ 417

GLOSSARY ........ ..... . . .... .. .... . .... . ...... ....... . ............................ . ..... . ................. . .. . ................... . ................ 423