LEI 11079 PDF

Lei no , de 30 de dezembro de Retrieved August 13, , from http :// Brasil. Lei No , de 30 de dezembro de , available at: Lei/Lhtm>. An English version. Full text of the law is available online. Lei No. , de Dezembro de ( Braz.) Lei/Lhtm>.

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This Law establishes general norms for public-private partnership tenders and contracts within the Federal Government, States, Federal District and Municipalities. This Law shall apply to entities of the direct Public Administration, special funds, agencies, public foundations, state-owned enterprises, corporations with mixed public and private capital and other entities that are directly or indirectly controlled by the Federal Government, States, Federal District and Municipalities.

A public-private partnership is a concession contract, in the sponsored or administrative forms. III — the sole scope of the contract is the supply of labor, the supply and installation of equipment or the execution of public works. Administrative concessions shall be regulated by this Law and additionally by art.

The following guidelines shall be observed when contracting public-private partnerships:. I — efficiency in the fulfillment of the missions of the State and in the use of public resources. II — respect for the interests and rights of service users and of private entities responsible for service provision. III — non-delegation of regulatory and jurisdictional functions, as well as the exercise of enforcement powers and other State activities.

The clauses of public-private partnership contracts shall be in accordance with the provisions of art. I — the term of the contract, which shall be in line with the amortization of the investments to be made by the private partner, not shorter than 5 fiveand not longer than 35 thirty-five years, including possible extensions.

II — the penalties applicable to the Public Administration and to the private partner in case of non-compliance with contractual obligations, which shall always be determined proportionately to the magnitude of the offence committed and to the obligations assumed. III — the sharing of risks among the parties, including those that refer to acts of God, force majeure, acts of State and unforeseeable events.

IV — the forms of remuneration and adjustment of contractual values. V — the mechanisms to preserve the nature of the service provision. VI — the facts that trigger public sector payment default, the means and terms for reestablishing the payment stream and, if applicable, the form by which guarantees are enforced. VII — the objective criteria for evaluating the performance of the private partner. IX — the sharing with the Public Administration of the economic gains of the private partner resulting from the reduction of credit risk related to the funding contracted by the private partner.

X — the inspection and due diligence of the assets to be transferred to the public sector, which shall enable the public authority to withhold payments to the private partner, in the amount necessary to repair any irregularities that may be detected. I — the requirements and conditions under which the public sector can authorize step-in-rights in favor of the financial institutions that funded the special purpose entity, with the objective of promoting its financial restructuring and ensuring the continuity of service provision, for which purpose item I of the sole paragraph of art.

II — the possibility that public sector payment can be made directly to project funders. III — the legitimacy of project funders to receive compensation for early termination of the contract, as well as payments made by funds and state-owned enterprises acting as guarantors of public-private partnerships.

The payments from the Public Administration to the private partner in public-private partnership contracts may take the form of:. III — granting of rights against the Public Administration. IV — granting of rights over real estate owned by the government. The contract may stipulate a variable payment to the private partner linked to its performance, which shall be assessed against required quality and availability standards.

The payment provided by the Public Administration shall obligatorily be preceded by service delivery. According to the terms of the contract, the Public Administration may pay the private sector partner for the portion of the service that is made available. The payment obligations undertaken by the Public Administration under a public-private partnership contract may be guaranteed by:. I — attachment of revenues, subject to the provisions of item IV of art.

III — obtaining surety bonds from insurance companies not controlled by the state. IV — guarantees granted by international organizations or by financial institutions not controlled by the state. V — guarantees provided by a guarantee fund or by a state-owned enterprise set up for this purpose. Before contract execution, bidders must set up a special purpose entity, which shall be responsible for implementing and managing the project.

Public-private partnerships shall be procured by competitive public bidding. The opening of the bidding process requires:. I — authorization by the public authority, based on a technical study that shall demonstrate:. II — estimate of budgetary and financial impact in the periods in which the public-private partnership contract shall be in effect. III — statement by the party responsible for authorizing the expenditure that the obligations undertaken by the Public Administration in a partnership contract are in line with the Budget Guidelines Law and have been considered in the Annual Budget Law.

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IV — estimate of long-term flow of public funds, necessary for fulfilling, throughout the term of the contract and in each fiscal year, the financial obligations undertaken by the Public Administration. V — its object is included in the Multi-Year Plan in effect within the scope of the conclusion of the contract. VI — submission of the draft invitation to tender and the draft contract to public consultation, which should be advertised in the official press, in newspapers of general circulation and in electronic media, informing the arguments for contracting a partnership, the scope and term of contract, its estimated value, setting a minimum period of 30 thirty days for comments and suggestions, which shall end at least 7 seven days prior to the scheduled date for publishing the invitation to tender; and VII — prior environmental license or release of guidelines for the environmental licensing of the project, as required by regulation.

I — requirement of bid bond, subject to the limit established in item III of article.

III — the use of private mechanisms for dispute resolution, including arbitration, to be conducted in Brazil and in the Portuguese language, according to Lawdated September 23rd,in order to resolve conflicts that may arise in relation to the contract.

The invitation to tender shall specify, when applicable, the payment guarantees to be granted by the public sector to the private partner. The competitive tendering for contracting public-private partnerships shall comply with the procedures set forth in the legislation that regulates tenders and administrative contracts and also the following:.

I — the contract award may be preceded by a qualifying stage of technical proposals, in which bidders that do not attain a minimum number of points are disqualified, not taking part in the subsequent stages. II — the contract award may adopt the following criteria, in addition to those provided for in items I and V of article.

III — the invitation to tender shall define the form for presenting the proposals, allowing the following formats:. IV — the invitation to tender may allow bidders to amend proposals in order to rectify faults, insufficiencies or yet make corrections of a formal nature during the course of the proceedings, provided bidders are able to comply with the requirements within the time period established in the invitation to tender.

I — the bids in the open outcry auction shall always be submitted in the reverse order of classification of the written proposals and the invitation to tender shall not limit the number of bids.

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The invitation to tender may allow a reverse bidding procedure, in which the contract award stage precedes the qualifying stage. II — after compliance with the requirements of the invitation to tender has been attested, the bidder who made the best offer shall be declared winner.

III — if the bidder who made the best offer is not qualified, the qualification documents of the second best proposal shall be examined, and so forth, until a classified bidder complies with the requirements established in the invitation to tender.

IV — upon announcement of the final result of the bidding process, the contract shall be awarded to the winner, in accordance with the technical and economic conditions proposed. I — definition of priority services to be procured in the public-private partnership format.

III — authorization for opening bidding processes and approval of invitations to tender. IV — evaluation of contract performance reports. I — Ministry of Planning, Budget and Management, which shall be responsible for coordinating the activities. I — the Ministry of Planning, Budget and Management, with regard to the merit of the project. II — the Ministry of Finance, with regard to the viability of granting public payment guarantees and their form, relative to the risks for the National Treasury and compliance with the limit set forth in art.

The Ministries and Regulatory Agencies shall be responsible, within their respective jurisdictions, for submitting the invitation to tender to the agency, carrying out the bidding process, monitoring and controlling the public-private partnership contracts.

The Ministries and Regulatory Agencies shall present to the body described in the caput of article. The FGP shall be created, administered, managed and represented by a financial institution controlled by the Federal Government, subject to the rules referred to in item XXII of article. The guarantees of the FGP to each quotaholder shall be made in proportion to the value of his quotas.

Taking into account the guarantees already granted and other obligations, the FGP shall not provide guarantees with a net present value that exceeds the total value of its assets. IV — fiduciary transfer of ownership, remaining the possession of the assets, until execution of the guarantees, with the FGP or with a trustee contracted by the Fund.

V — other contracts that produce the effect of a guarantee, provided they do not transfer the ownership or direct possession of the FGP assets to the private partner before the execution of the guarantee. VI — trust funds settled by the FGP to provide guarantees to the private partners. The FGP shall not pay any dividends to its quotaholders. The quotaholders shall have the right to make full or partial redemptions of quotas, corresponding to equity as yet unused for the concession of guarantees.

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The redemption price shall be determined based on the equity value of the FGP on the date of redemption. The dissolution of the FGP, as decided by the board of quotaholders, shall be subject to prior settlement in full of the guaranteed obligations or the release of guarantees by the creditors. After the dissolution of the FGP, its equity shall be divided among the quotaholders, based on the equity position of the Fund on the date of dissolution.

The FGP may set up trust funds to provide guarantees to specific private partners. The trust funds assets will not be subject to search and seizure resulting from other obligations of the FGP. The constitution of trust funds shall be registered by a Real Estate Notary in the case of real estate or by a Regular Public Notary in the case of other types of assets.

The National Monetary Council shall establish, in accordance with the appropriate legislation, guidelines for the concession of credit facilities for financing public-private partnership projects, as well as for the participation of pension funds in funding partnership contracts.

The National Treasury Office shall publish, in accordance with the appropriate legislation, general norms regarding public accounts in relation to public-private partnership contracts. I – collateral in cash or government bonds, which must have been issued in book entry form, by registration in a central system for settlement and custody authorized by the Central Bank of Brazil and appraised at their economic value, as defined by the Ministry of Finance; II — state-owned enterprises or corporations with mixed public and private capital controlled by the Federal Government.

The penalties provided for in Decree-Lawdated December 7th, — Criminal Code, in Lawdated June 2nd, — Administrative Misconduct Law, in Lawdated October 19th, – Fiscal Crimes Law, in Decree- Lawdated February 27th,and in Lawdated April 10th,shall apply to public-private partnerships, notwithstanding the financial penalties provided for in contract.

This Law shall be in effect from the date of its publication. This is a free translation offered only as a convenience to lfi foreign investors. Any questions arising from the translated text should be clarified by consulting the original version in Portuguese: The following guidelines shall be observed when contracting public-private partnerships: I — efficiency in the fulfillment of the missions of the State and in the use of public resources; II — respect for the interests and rights of service users and of private entities responsible for service provision; III — non-delegation of regulatory and jurisdictional functions, as well as the exercise of enforcement powers and other State activities; IV — fiscal responsibility when contracting and implementing partnerships; V — transparency of procedures and decision-making; VI — objective risk sharing among the parties; VII — financial sustainability and socio-economic benefits of the partnership projects.

The payments from the Public Administration to the private partner in public-private partnership contracts may take the form of: I — bank draft; II — assignment of non-tax credits; III — granting of rights against 1079 Public Administration; IV — granting of rights over real estate owned by the government; V — other means permitted by law.

The payment obligations undertaken by the Public Administration under a public-private partnership contract may be guaranteed by: The opening of the bidding process requires: I — authorization by the public authority, based on a technical study that shall demonstrate: The competitive tendering for contracting public-private partnerships shall comply with the procedures set forth in the legislation that regulates tenders and administrative contracts and also the following: I — the contract award may be preceded by a qualifying stage of technical proposals, in which bidders that do not attain a minimum number of 1109 are disqualified, not taking part in the subsequent stages; II — the contract award may adopt the following ,ei, in addition to those provided for in items I and V of article.

I — definition of priority services to be procured in the public-private partnership format; II — establishment of procurement procedures; III — authorization for opening bidding processes and approval of invitations to tender; IV — evaluation of contract performance reports.

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I — the Ministry of Planning, Budget and Management, with regard to the merit of the project; II — the Ministry of Finance, with regard to the viability of granting public payment guarantees and their form, relative to the risks for the National Treasury and compliance with the limit set forth leii art. I — pension funds; II — state-owned enterprises or corporations with mixed public and private capital controlled by the Federal Government.

Brasilia, December 30th,

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