8 Public Procurement and Concessions

Abstract

The Brazilian public administration is an important customer of private companies. Together, the Federal Union, the Brazilian states, and the municipalities are by far the largest counterparty for the construction and facility management sector. Furthermore, the current government is promoting privatization, thereby creating opportunities for foreign investors, especially in the energy and aviation sector (airport privatization). Therefore, this chapter is very important for investors. It will focus on public procurement and contracts between private parties and units of the public administration. This specific area of the law, termed administrative law is not yet codified. Instead, it consists of a rather fragmented bundle of laws with an overlapping scope of application. However, two pillars stand out: the Public Procurement Act and the General Concession Act. Under the CFRB the acquisition of almost all goods and services needed by the public administration requires a public call for tender. Therefore, the recently revamped Public Procurement Act will be discussed extensively. The second key focus of this chapter is administrative contract law and its new provisions on risk allocation.