Flexibilization of tenders now forwarded to Ms. Rousseff

This Wednesday night (July 6th), the Brazilian Senate has approved, with 46 votes in favor of the motion and 18 against, the Bill of Law that establishes greater flexibility for tenders for 2014 FIFA World Cup™ and 2016 Olympic Games work. This Bill, which allows contracts for matches with rules different from those established by the Brazilian Tender Law which is Law 8,666, now goes to the Brazilian President Dilma Rousseff to be signed into Law.

The declared aim of the so-called Distinctive Hiring Regime (Regime Diferenciado de Contratações – RDC) is that of speeding up the hiring of work and services as planned for these sporting events with simpler tender processes. The rapporteur in the Brazilian senate, Inácio Arruda, from the Communist Party of Brazil, representing the state of Ceará, made some adjustments to the wording, but the text as approved by the Senators preserves the changes which were made by the Congress people over the last few weeks.

Secrecy
The proposal sets out that the budget available for the work and services will only be disclosed to the public and to the competitors after the winning company has been chosen. The inspection organizations such as the Federal Audit Court (Tribunal de Contas de União - TCU) and the General Federal Financial Control Institution (Controladoria Geral da União - CGU), will have Access to this information at any moment – but this provision was only included in the text after much pressure from the Press and also from the Opposition.

“Uncontrolled Corruption”
The leader of the Brazilian Social Democracy Party (PSDB) in the Senate, Álvaro Dias (State of Paraná), has criticized the approval of more flexible rules for tenders for sporting events, mainly after the tip-offs about overpriced public works connected to the Ministry of Transport this week, leading to the fall of the head officer of this area, Alfredo Nascimento.

“This measure has already been criticized by the Federal Prosecution Office (Ministério Público Federal – MPF) and also by barristers of the Supreme Court. Apart from the evident unconstitutionality of this project, it also opens the floodgates to uncontrolled corruption”, he said.

The PSDB member drew attention to critical points of the project, such as the waiving of the need to present a complete project for the work to be tendered for, and subjective criteria for choosing the winners. The leaders of the Brazilian Social Democracy Party (PSDB) and also the Democrats (DEM) have said that they will be going to the Supreme Court to present a Direct Action of Unconstitutionality to defeat the RDC.

In the opinion of the rapporteur of the project, Inácio Arruda, the RDC should not allow more irregularities than the current law. “Many argue that it is possible to create a situation of even more abuse. Well, I doubt that a law can do this, even more so as we have control instruments as never before. […] Hence, I am not fearful of the possibility that the Law could open loopholes for something that has no sense”.

Different from the Tender Law, the new rules allow the hiring of a company that is responsible for all the items within the work project, supply of materials and equipment, and execution. The text also opens loopholes so that, in some cases, the hirings may be made without a basic or an executive project.

Radius of 350 km
Another controversial item in the text is that the work within a radius of 350 kilometers from the host cities can also be included in the RDC, Thus, work in Goiânia (GO), which is 210 km from Brasília, for example, which is in any way connected with the World Cup matches, can also have simpler rules for the hirings.

Institutions protest
Yesterday, even before the vote in the Senate, several organizations showed their position against the approval of the provisional measure which establishes the Distinctive Hiring Regime (Regime Diferenciado de Contratações – RDC).

Apart from Sinaenco, which brings together 20 thousand companies in the areas of engineering and architectural design from throughout the country, other institutions to take up this position were the Federal Council of Engineering, Architecture and Agronomy (Conselho Federal de Engenharia, Arquitetura e Agronomia - Confea), the National Association of the Accounts Prosecution Office (Associação Nacional do Ministério Público de Contas - Ampcon), the Unique Workers’ Center (Central Única dos Trabalhadores - CUT), the Municipal Health Council of the City of Porto Alegre (Conselho Municipal de Saúde de Porto Alegre - RS), the Ethos Institute of Companies and Social Responsibility (Instituto Ethos de Empresas e Responsabilidade Social), Institute of Inspection and Control (Instituto de Fiscalização e Controle - IFC), Social Observatory Institute (Instituto Observatório Social), Institute for São Paulo Against Violence (Instituto São Paulo contra a Violência), Brazilian Network of Fair and Sustainable Cities (Rede Brasileira de Cidades Justas e Sustentáveis), the Our São Paulo network (Rede Nossa São Paulo) and the Trade Union of Workers in the Brazilian Legislative and the Federal Audit Court (Sindicato dos Servidores do Poder Legislativo Federal e do Tribunal de Contas da União), among other institutions.