Imprecisions in the Matter of Compensations in Concessions and Public-Private Partnerships in Brazil

Until recently, the subject of contractual terms was not part of the main discussions on the structuring of concessions and public private partnerships (PPP) in Brazil. However, the practical challenges experienced by the Public Administration on this matter revealed the need for its review. As a matter of fact, early contractual terminations and the duty to provide a previous response to the effects of each event allowing for an early termination became more compelling in a credit crisis scenario. Despite the development of decision-making techniques in Brazilian law, some inaccuracies and doubts can still be found regarding the amount of compensation due and its quantification in concessions agreements and PPP.