The Chamber is reviewing the Bill 4246/08, authored by the Deputy Antonio Carlos Magalhães Neto (DEM-BA), which increases the margin for the concession of guarantees and voluntary transference of the Union to states and municipalities, in case of government-private partnerships (PPPs).

According to the bill, the Union will not be allowed to grant guarantees and to perform voluntary transferences if the expenses of the total amount of partnerships which had already been contracted by states and municipalities in the previous year are higher than 10% of the current net revenue at year-end.

The prohibition will also be valid if the yearly expenses of the prevailing contracts in the 10 following years exceed 10% of the forecast net revenue for the respective terms. Currently, Law 11.079/04, which regulates bids and the contracting of government-private partnerships, establishes a limit of 1%.

Trouble
Magalhães Neto reminds that government-private partnerships are responsible for the reduction of government expenses in the infrastructure area, since they consist in the cooperation between government and private sectors, in which they share risks and loans.

He believes, though, that the current prohibition imposed by the law for the concession of guarantees hampers the accomplishing of partnerships.

"That prohibition has been preventing the accomplishment of extremely important infrastructure projects for our country, which justifies the increase in the legal limit to 10% of the current net revenue”, he affirms.

Procedure
The bill is being processed in conclusive character and will be analyzed by the Committees on Labor, Administration and Public Service; on Finances and Taxation; and on the Constitution and Justice and Citizenship.

Report - Noéli Nobre
Editing - Newton Araújo
Translation - Positive Idiomas Ltda