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IC&A 20_Brazil Infrastructure Law_vDEF_Opmaak 1 23-02-16 13:47 Pagina 1 edited by marçal justen filho, ic ic edited by cesar pereira and &a &a marçal justen filho, maria augusta rost cesar pereira and maria augusta rost brazil brazil infrastructure law infrastructure law b r a This book offers the international reader a comprehensive view of Brazilian infrastructure law z from the standpoint of key local practitioners. It is divided into two sections. The first part i l features a collection of essays on the most significant infrastructure topics. It is followed by bilingual versions of the main statutes and regulations examined in the various essays found i n in Part 1. A glossary of essential infrastructure terminology is also included. f r a The topics discussed in this book range from an overview of the Brazilian constitutional s structure to in-depth analyses of regulated sectors, public procurement, and dispute resolution. t The various essays contained herein cover the fundamental legal issues an international player r u must keep in mind when working in the Brazilian infrastructure market. This work utilizes a c comparative approach, and is intended to correlate Brazilian legal specificities with their t counterparts in internationally recognized models. u r e This work aims to provide essential guidelines that will enable international infrastructure l investors, practitioners, and scholars to successfully navigate Brazilian law and legal practice. a w m c m e a a s r r a i ç r a a international commerce l p international commerce a e u j r u g e and arbitration s u and arbitration i t s r e t a n a volume 20 volume 20 a f r n i o l d s h series editor series editor t o ingeborg schwenzer , ingeborg schwenzer 16.019 - 23.02.2016 - Rug 48,7 mm Table of Contents Preface and Acknowledgments ix Contributors xi Glossary xvii Part I Essays 1 An Overview of Brazilian Law 3 Marçal Justen Filho 2 Control of the Independent Regulatory Agencies 17 Alexandre Wagner Nester 3 Administrative Procedure and the Independent Regulatory Agen- cies 31 André Guskow Cardoso 4 Rule-Making Power of Independent Regulatory Agencies in Brazil 43 Diogo Albaneze Gomes Ribeiro 5 Brazilian Antitrust Law 55 Alexandre Wagner Nester 6 Competition Law Enforcement in Regulated Sectors 75 Marçal Justen Neto 7 An Overview of the Regulation in the Electricity Sector in Brazil 83 André Guskow Cardoso and Marçal Justen Neto 8 Telecommunications Law of Brazil 97 Aline Lícia Klein and Alan Garcia Troib 9 Infrastructure and Logistics in the Brazilian Transportation Sys- tem 111 Rafael Wallbach Schwind and Juliane Erthal de Carvalho v Table of Contents 10 Oil and Gas Regulation in Brazil 141 Cesar Pereira, Karlin Olbertz and Maria Augusta Rost 11 Mining in Brazil: Regulatory Scenario and Opportunities for Investment 173 Ricardo Barretto de Andrade and Vitor Lanza Veloso 12 Waste Management Regulation in Brazil 185 William Romero and Mônica Bandeira de Mello Lefèvre 13 Basic Sanitation Services in Brazil 197 Guilherme Fredherico Dias Reisdorfer and Diogo Albaneze Gomes Ribeiro 14 Environmental Licensing in Brazil 215 Cesar Pereira, Roberta Jardim de Morais, Manuela Demarche Mello, Fernanda de Abreu Tanure and Paola Braga Sunye 15 Public Procurement in Brazil: General Rules 229 Cesar Pereira 16 Reverse Auction as a Method of Public Procurement 257 Ana Lucia Ikenaga, Mayara Ruski Augusto Sá and Thalita Bizerril Duleba Mendes 17 Public Procurement Financed by International Agencies and Multi- lateral Funds in Brazil 277 Rafael Wallbach Schwind 18 The System of Protests and Appeals in Brazilian Public Biddings Law 289 William Romero 19 Differential Public Procurement Regime (RDC): Main Characteris- tics 299 Daniel Siqueira Borda and Mayara Gasparoto Tonin 20 Brazil’s Anti-Corruption Laws, the FCPA and the UK Bribery Act: A Comparative View 319 Cesar Pereira, Jacqueline Henry-Lucio and Luísa Paschoaleto Martim 21 Government Contracts in Brazilian Law 347 Aline Lícia Klein, Guilherme Fredherico Dias Reisdorfer and Karlin Olbertz vi Table of Contents 22 Concessions of Public Services and Public–Private Partnerships (PPP) in Brazil 369 Cesar Pereira 23 Public–Private Partnerships (PPP) in Brazil 389 FernãoJustende Oliveira 24 Brazilian Corporate Taxation 399 Michelle Pinterich 25 Construction Contracts in Brazilian Law and the Standard Interna- tional Model Contracts 415 Rodrigo Goulart de Freitas Pombo 26 Brazil in the Context of International Arbitration 427 Mauricio Gomm Santos and Quinn Smith 27 Arbitration in Brazil 445 Felipe Scripes Wladeck and Paulo Osternack Amaral 28 Recognition of Foreign Judgments and Awards in Brazil 461 Cesar Pereira Recognition of Arbitral Awards in Brazil 481 Part II Bilingual Versions of Relevant Statutes Brazilian Federal Constitution – Excerpts 501 Law n. 8.666/1993 (Biddings and government contracts) 515 Law n. 12.462/2011 (Creates the Differential Public Procurement Regime – RDC) – Excerpts 593 Decree n. 7.546 (Regulates the changes to Law n. 8.666 made by Law n. 12.349 – “Buy National”) 621 Law n. 10.520/2002 (Reverse auction) 629 Law n. 8.987/1995 (Concessions of Public Services) 635 vii 20 Brazil’s Anti-Corruption Laws, the FCPA and the UK Bribery Act: A Comparative View1 Cesar Pereira*, Jacqueline Henry-Lucio** and Luísa Paschoaleto Martim*** 20.1 Introduction Most countries implement anti-corruption policies, which often grow into anti-corruption laws. Nonetheless, it is said that “[t]he majority of people around the world believe that their government is ineffective at fighting corruption and [that] corruption in their country is getting worse.”2 Voicing similar concerns, in June 2013, Brazilians protested and rioted in the streets demanding more transparency and less corruption.3 1 The authors thank Diane Camacho, a NY-based attorney, for her invaluable assistance in editing this chapter. * Cesar Pereira is a Brazilian attorney and named partner at Justen, Pereira, Oliveira & Talamini Advogados (São Paulo). He holds an LLM (1998) and JSD (2005) in Public Law from Pontificia Universidade Católica (PUC-SP) and was a visiting scholar at Columbia University Law School in 2013-2014. He has published and edited numerous books, articles and book chapters on subjects related to infrastructure, public law and arbitration. He is a Fellow of the Chartered Institute of Arbitrators (FCIArb) and serves as an arbitrator in matters involving PPPs, contracts and commercial law. He is the president of the Arbitration Center of the Federation of Industries of the State of Paraná (CAMFIEP) and vice-president of Brazil Infrastructure Institute, an industry think tank. Postal address: Rua Joaquim Floriano, 413, cj 111 – São Paulo, SP – 04.5r34- 011. Brazil. E-mail: <[email protected]>, <[email protected]> or <cesar.pereira@brazilin- fra.com>. ** Jacqueline Henry-Lucio is a second-year law student at The George Washington University Law School and the 2015-2016 Vice-Chair of Publications for the American Bar Association Section of International Law’s U.N. and International Organizations Committee. She wrote this chapter while interning at Justen, Pereira, Oliveira & Talamini Advogados in São Paulo, Brazil. E-mail: <[email protected]> or <[email protected]>. *** Luísa Paschoaleto Martim is a final-year law student at Universidade Presbiteriana Mackenzie and intern at Justen, Pereira, Oliveira & Talamini Advogados in São Paulo, Brazil. E-mail: <[email protected]> or <[email protected]>. 2 D. Hardoon & F. Heinrich, ‘2013 Global Corruption Barometer’, 2013, available at: <http://trans- parency.hu/uploads/docs/GCB2013_Report_Embargo.pdf>, access on 15 December 2015. 3 B. Brooks, ‘Brazil: 250K Protest Against Government Corruption’, USA Today, 23 June 2013, available at: <www.usatoday.com/story/news/world/2013/06/22/brazil-thousands-protest-anew-but-crowds- smaller/2449229/>; ‘Brazil Protests: Dilma Rousseff Unveils Reforms,’ BBC World, 22 June 2013, available at: <www.bbc.com/news/world-latin-america-23012547>, access on 15 December 2015. 319 Cesar Pereira, Jacqueline Henry-Lucio and Luísa Paschoaleto Martim That same year, Transparency International conducted a global survey,4 where more than one in four people, an estimated 27%, reported having paid a bribe in the last year when interacting with key public institutions and services.5 The same survey also revealed that two-thirds of those propositioned to pay a bribe say that they refused, indicating there may be a stronger movement to stop corruption than one may have thought.6 The most popular means of combating corruption has been anti-corruption laws. The United States implemented the Foreign Corrupt Practices Act (FCPA) in 1977 after inci- dents like the Watergate scandal exposed how far corruption had reached within the national government.7 Although the U.S. had always banned domestic corruption, the FCPA was the first law to directly prohibit payments to foreign officials for purposes of influencing any official act, obtaining or retaining business or for securing any other kind of improper advantage.8 The UK followed with the UK Bribery Act (‘Bribery Act’), which has been in force since 2011.9 The Bribery Act targets a wide range of situations that can be grouped into four “categories of offenses: (1) bribing another person; (2) taking bribes; (3) bribing foreign public officials; (4) the failure of a commercial organization to prevent bribery.”10 Similar to the FCPA, the UK Bribery Act makes it illegal for companies to pay foreign government officials for their assistance in obtaining or retaining business. However, it also holds companies liable for failing to prevent bribery.11 Yet by 2014 only three convictions had been brought under the Act, none of which involved corporate corruption.12 Brazil’s newest anti-corruption law, the Brazilian Anti-corruption Act (BACA), was enacted on 1 August 2013, and entered into force 180 days later in January 2014, which marks a remarkably quick turnaround for the country.13 The BACA was timed perfectly 4 Note: this study consisted of 114,000 respondents in 107 countries, approximately 1,000 respondents per country.