Secretariat of Ports regulates advanced extensions of port lease agreements
By Fabiana Rodrigues da Fonseca
Through Ordinance No. 349 issued on September 30, 2014 and published the next day, the Secretariat of Ports of the Presidency of Brazil (local acronym SEP/PR) finally regulated section 57 of Law No. 12,815/13 (the Port Act currently in force), which allows for the extension, in advance, of port lease agreements signed during the previous law (Law No. 8,630/93), provided that such agreements have a specific provision about such extension but no extension has yet been carried out.
One of the main purposes of Ordinance No. 349 is to provide greater legal certainty to the immediate realization of investments aimed at expanding, modernizing and optimizing Brazil’s port facilities.
Advanced extensions require, at the discretion of the SEP/PR, that: (i) all contractual obligations in force have been fulfilled (such fulfillment to be evidenced in a detailed report prepared by the Port Authority); (ii) the Investment Plan (which must contain a brief description of the intended investment and the expected capacity and performance) is approved; and (iii) the technical feasibility study is approved. In addition to the Investment Plan, the lessee may also request that the economic-financial balance of the contract be re-established based on prior events.
Any request for extension already made but still ongoing on the date of publication of Ordinance No. 349 must be adjusted according to the new rule, without prejudice to any ongoing analysis. According to the numbers provided by SEP/PR, such requests for extension account for investments of approximately BRL 7.3 billion.