This document outlines Brazil's infrastructure framework and investment opportunities. It discusses Brazil's strong economy and growing middle class population that is driving demand for improved infrastructure like urban transportation and logistics networks. The Brazilian government's strategy is to accelerate major infrastructure investment programs totaling $235 billion to address challenges and capitalize on opportunities. The framework describes Brazil's bid procedures and public contracting regulations, emphasizing compliance with laws governing relationships between private and public partners.

2. Brazil's Infrastructure Framework

3. AGENDA
1. BRAZIL NOWADAYS
2. BRAZILIAN GOVERNMENT'S STRATEGY
3. INVESTMENT OPPORTUNITIES
4. OVERVIEW OF BRAZILIAN BID PROCEDURES FRAMEWORK
5. PUBLIC AGREEMENTS
6. COMPLIANCE STRUCTURE

4. BRAZIL NOWADAYS

5. BRAZIL NOWADAYS
 Brazilian economy
produces a wide
range of
manufactured goods:
 automobiles (3.3
million units in 2012)
 aircraft
 sophisticated
machines
Many factors have forced
the country to accelerate
investments especially in
infrastructure, such as:
The Brazilian income
growth
The social inclusion
process

6. BRAZIL NOWADAYS
 Joined the group of the
most dynamic
emerging countries of
the world
 The Gross Domestic
Product (GDP) is
currently among the
ten largest in the
world, either in
nominal terms or in
purchasing power
parity
 Unemployment rate
below 5%
 Living a period of
rapid and sustained
economic
development, based
on:
 production growth,
 soundness of fiscal
and monetary
institutions and
investment,
 credit and
consumption
expansion;
 Market of over 100
million consumers
with huge growth
potential
 Vitality of
entrepreneurial class
and technological
advances in the
agriculture industry

7. BRAZIL IN NUMBERS

8. INCREASED INVESTMENT AS A PRIORITY

9. INFLATION UNDER CONTROL

10. STRENGTH OF THE EXTERNAL SECTOR

11. 5th LARGEST GLOBAL MARKET IN 2020

12. MIDDLE CLASS SOCIETY

13. LOWER INTEREST RATE

14. REDUCED COSTS FOR INVESTMENTS
The Government
has put in place
several measures
aiming to reduce
investments costs,
among which the
following stand
out:

15. FOREIGN DIRECT INVESTMENTS HIGH LEVELS

16. EXPECTED GROWTH IN BUSINESS

17. BRAZILIAN AGRICULTURE: NEED OF LOGISTICS
source: http://www.estadosecapitaisdobrasil.com/mapas-do-brasil.php

18. BRAZILIAN POPULATION: NEED OF LOGISTICS
source: http://www.scp.rs.gov.br/upload/mapa_popula%C3%A7%C3%A3o_absoluta_brasil_2010(1).gif

19. DEMAND FOR INFRASTRUCTURE

20. LARGE INVESTMENT PROGRAMS
Several major infrastructure
programs were announced over
the last two years, with
investments adding around US$
235 billion over the coming
years, not to mention the major
urban infrastructure works
required for the 2014 World Cup
and 2016 Olympics

21. CHALLENGES

22. BRAZILIAN GOVERNMENT STRATEGY

23. BRAZILIAN GOVERNMENT STRATEGY

24. BRAZILIAN GOVERNMENT STRATEGY

25. INVESTMENT OPPORTUNITIES

26. INVESTMENT OPPORTUNITIES

27. INVESTMENT OPPORTUNITIES

28. Urban transportation -- BBiigg CCiittiieess
•Target - 23 municipalities
•Value – R$ 32 billion
•Subway, Light rail vehicle (VLT) and urban rails
•Highlights:
•Salvador Subway: in Request for Proposals
•São Paulo Subway - Line 6: Bidding process - rescheduled
•São Paulo Subway - Line 18: In public hearing process
•São Paulo Intercities Train - Studies proposed in July, 2013 - under
analysis

29. OVERVIEW OF BRAZILIAN BID PROCEDURES
FRAMEWORK

30. BRAZILIAN BID PROCEDURES FRAMEWORK

31. BRAZILIAN BID PROCEDURES FRAMEWORK
 Lei de Geral de Concessões (Law 8987/1995): establishes general rules regarding concessions of
public services, with no Government Payment
 Lei de Parceria Público-Privada (Law 11.079/2004): establishes general rules for the concessions
with Government Payments (public-private partnership contracts - PPP). Types:
(i) Sponsored Concession: public work or public service upon guaranteed payments from
public administration, in addition to tariffs charged from end-users. Ex.: highways
(ii) Administrative Concession: end-user is the public administration and shall provide
payment to the private party. Ex.: hospitals, public buildings

32. www.comprasnet.gov.br > acesso livre > consultas> aviso de licitações

33. PUBLIC AGREEMENTS

34. PUBLIC CONTRACTS
INITIATING & PLANNING = BIDDING PROCEDURE
•Its the key phase to negotiate the terms of the Future Contract
•Request for Information / Quotation
•Public Hearing
•Request for Propostal - Bidding Procedure (Request for Clarifications - Risk
Breakdown Structure)
•Administrative and Legal Mesures (Impugnação)
EXECUTION & CONTROLLING = CONTRACT MANAGEMENT
•Inaccuracy of the "Statement of Work" / "Services Level Agreement" (TR - Termos
de Referência, Especificações )
•Extra requirements of the Public Client (Was it foreseen in the SOW and
Budget?)
•Penalties due to lack of performance / delays / "redoings"
•Payments / cash flow of the Governmental Budget
•Everything shall be written and official - EVER!!
CLOSING
•Claims and Instruments of Closing (via crucis)

35. PUBLIC CONTRACT
According to Federal Law 8.666/93, administrative
contract is all and every agreement executed
between public agencies and private parties, in
which it is established mutual obligations
According to Federal Law 8.666/93, administrative
contract is all and every agreement executed
between public agencies and private parties, in
which it is established mutual obligations

36. TYPES OF ADMINISTRATIVE AGREEMENTS

37. RISKS AND PROBLEMS The contract terms
shall be always
observed - it can
not be changed or
turned
undetermined!

38. RISKS AND PROBLEMS
The contractor is
responsible for the
quality and delivery
www.demarest.com.br 38

39. PRICE ADJUSTMENT

40. RENEGOTIATION

41. RESCISSION
Agreement rescissions cases must be formally justified in the records,
ensuring to the Contractor party the right of defense (adversary system
and full defense), in five business days .
If the rescission is not due the contractor's fault, and it's duly proven, the
Contracting must assure the:
• devolution of guarantee
• payment of the execution until the date of the rescission
• payment of demobilization costs
If the rescission is not due the contractor's fault, and it's duly proven, the
Contracting must assure the:
• devolution of guarantee
• payment of the execution until the date of the rescission
• payment of demobilization costs

42. COMPLIANCE STRUCTURE

43. THE NEW COMPLIANCE LAW
Law 12.846/2013 (Anticorruption) and Law 12.813/2013 (conflict of interests)
provides further regulation regarding the relationship between private and
Law 12.846/2013 (Anticorruption) and Law 12.813/2013 (conflict of interests)
provides further regulation regarding the relationship between private and
public parties regarding public contracts
public parties regarding public contracts
MAIN COMPLIANCE PRINCIPLES
SEPTEMBER, 5:
Workshop "Compliance and
Governmental Relations"
Don't miss it!

44. Ana Bárbara Costa Teixeira
(abteixeira@demarest.com.br)
Mário Roberto Villanova Nogueira
(mnogueira@demarest.com.br)
Min Gon Kim
(mgkim@demarest.com.br)