The legal framework for the Brazilian PPP programme is now in place, with considerable improvements in relation to the previous legal provisions on similar projects.
There is now a legal authorisation for the PPP contracts to establish the conditions for the vehicle carrying out the PPP project to be transferred to its financier´s in the event of financial distress, for the sake of the project continuity.
Another improvement of the Law on PPP is the provision for the creation of a guaranty fund to be established as a private entity separate from the Government, with authorisation for the Government to contribute up to R$ 6 billion as capitalisation of the guaranty fund. The Law on PPP also establishes that esch PPP project will be allocated an individual part of the assets of the guaranty fund, with separate accounting, so as not to affect the collateral of any PPP project with any future difficulties of another.
For potential investors to properly understand the future Government proposals for each specific project in time to position themselves for the same, they need to have a good idea of the relevant legal provisions, which is described in a practical manner in this Guide, which also contains free translations of the specific legislation on PPP.
This Guide has been prepared by partners of Noronha Advogados, an international law firm with headquarters in São Paulo, Brazil and ten other offices in six Countries.
Observador Legal Editora Ltda., São Paulo, Brasil, 2005