Lawyer says that preference for Petrobras is unconstitutional

22/10/2009 13h55

The lawyer Antônio Luís Ferreira, expert in the oil area, said in the special committee that analyzes the Bill that creates the production sharing system in the pre-salt area that, if the text passes as it is, it will be possible to question it in The Supreme Court, because of the preference given to Petrobras in such contracts.

By the regulation that government proposes (Bill 5938/09), the Union may hire the company directly. When it does not happen, Petrobras shall take part in private consortia with at least 30%.

“It is not possible to return to a time in which only Petrobras executed the monopoly of the Union,” stated Ferreira. The lawyer defended the constitutional principle against laissez-faire. According to him, after one has approved the constitutional amendment, initiating the industry competition to private market, in 1995, it would not be possible choosing a company to explore it in advance. Namely, it would be necessary a bidding.

Government defends
The assistant chief for Legal Issues from the Civil House, Beto Vasconcelos, stated, however, that the Constitution authorizes the Union who must be hired: State and Public Companies. He explained that one must not compete because the article 177 establishes the monopoly of Union over the industry. “It is a policy option”, he said.

According to the Federal Attorney General, Marcelo Freitas, Petrobras being a public company, i.e. private junior partners participating in it, does not conflict with the issue of lack of competition. Freitas explained such situation has been this way for a long time, also when the company acted alone in the Country. According to him, there is not legal problem because the Banco do Brasil also acts alone to manage funds that ensure exports.

Opening market in both oil and telecommunication industry, for Deputy Beto Mansur (PP-SP), was beneficial to the Country and should not be changed. The Deputy Miro Teixeira (PDT-RJ), worried about the legal discussion on such matter in the future, stated that he intends to prepare a constitutional amendment to clarify the matter, trying to avoid legal questions.

Veto Power
Ferreira also criticized the fact that the new state-owned enterprise, that will manage the sharing contracts, the Petro-Sal, has veto power concerning any situation for exploring. “There is not legal hindrance, but one cannot assign veto over everything. One has to define veto situations.” he said.

States and Municipalities
Deputy Eduardo Cunha (PMDB-RJ) wanted to know how lawyers has understood about distributing royalties for State and Municipality producers, matter that has not changed in the four pre-salt projects, but that one may define it in the future.

Beto Vasconcelos stated that the Constitution assures this compensation to the producers, but do not prohibit distributing benefits to other federal bodies. The Lawyer Antônio Luís Ferreira stated, however, that he has doubts about the matter because the Constitution assures the participation in the exploration that happens “in the territory” of the States and Municipalities.

Reporting – Sílvia Mugnatto / Radio Chamber
Edition – Wilson Silveira
Translation - Grupo Solucion-SP Language/Edgar Casadei