Privatization Trend In Brazil

Autor: Diogo Ciuffo Carneiro,
23/01/2018 Imprimir Enviar E-mail

The Federal government and the country’s largest city are expected to conduct this year the privatization of several companies and the concession of services and infrastructure projects.

A specter is haunting Brazil – the specter of liberalism. The recent political turmoil in Brazil has not halted President Michel Temer’s drive towards privatizations and the year of 2018 is bound to be seen as a milestone for the country’s resumption of investments in infrastructure.

By establishing over 70 privatization initiatives *, the country is literally open to investment of foreign players. The initiatives include from divestments of shares in state companies - the most emblematic being the sale of Eletrobras’ shares, the gigantic state company responsible for power generation, transmission and distribution - to renewal of concessions of ports and airports and new rounds of auctions for onshore and offshore oil and gas.

Many of such initiatives are still at the initial stage and the relevant auction notices have not been issued yet. But players from around the globe have already set eyes in the country and are actively studying the investment formats.

In São Paulo, under Mayor João Doria administration the largest city in Latin America has seen liberal trend take over. This new trend may be easily noticed when observing the privatization campaign currently in place.

In September 2017, the City Council approved a comprehensive privatization and concessions plan that authorizes the municipality to promote the privatization and concession of several parks throughout the city, bus terminals, public markets.

The crown jewels of this project include the Interlagos Complex, a gigantic area of approximately 1 million square meters comprehending the famous F1 track way and a kart racing track, the Pacaembu stadium, with capacity for more than 40,000 people and well-known venue for football matches and the Anhembi Complex, biggest convention center in Latin America.

Some tried to stopped the privatization plan, such as Councilman Mario Covas Neto, that filed a lawsuit to prevent City Council to approve it. The Court of Appeals of São Paulo dismissed the lawsuit, providing a bit of security for possible investor. It is likely that more lawsuits will pop-up as the privatizations program marches in, but the Judiciary branch have given proof it is willing to permit the privatizations goes by without long litigation.

In the beginning of 2018, the mayor of São Paulo also intends to revisit funeral services and outdoor advertising concessions, currently provided and regulated by the state. 

These measures show that the governments of both at the federal level and at the municipal level of jr largest city in the country acknowledge that the economic crisis must be tackled with more liberal approach, which gives private investors and companies more opportunities to venture in several sectors.

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https://g1.globo.com/economia/noticia/pacote-de-privatizacoes-do-governo-temer-preve-75-projetos-para-2018.ghtml




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Luiz Gustavo A. S. Bichara

bichara@bicharalaw.com.br Idiomas

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bichara@bicharalaw.com.br Idiomas

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