Economic and financial rebalance in infrastructure concessions in Brazil: reflections on the impacts of the Covid-19 pandemic

Abstract

Discussions about the consequences of the Covid-19 crisis in the country’s regulated infrastructure sectors and its effects on contracts have gained prominence among government representatives, the private sector and the academic area. That said, this research aims to demonstrate the impacts of this pandemic in some infrastructure sectors, considering the different positions of professionals, academics and entities from the public and private sectors, focusing on aspects related to the economic and financial rebalance of contracts. From the analyzes carried out, it appears that some essential factors need to be considered in discussions about possible rebalance requests, such as the procedures or parameters adopted for the analysis of these requests, the risks or concrete situations in which the concessionaires were in defaulters before of the crisis, the transparency of the mechanisms and procedures adopted by the bodies involved, the prior survey of risks specific to each regulated sector and the behavior of key contract variables due to the crisis. Moreover, it is important for the supervisory and control bodies to act in a coordinated manner in the analysis of issues involving the rebalance of contracts, in order to reduce overlaps and administrative and transaction costs for all instances and actors involved. The considerations of this study aim to contribute to the debate about the importance of the mechanisms of contractual balance as a fundamental aspect for the continuity of complex long-term businesses, as is the case of infrastructure concessions, without disregarding aspects such as governance, risk management and controls.