PRIVATE PARTICIPATION INCREASES IN THE BRAZILIAN PUBLIC SECTOR FUELED BY MIP

Luciana de Campos Maciel

In order to encourage the private sector to participate in works and services through Public Private Partnership (PPP), the state government of Sao Paulo published the Decree No. 57.289/2011, which details the procedure of the Manifestation of Interest from Private Sector (MIP).

The MIP is an instrument which gives the potential interested private person or entity, the possibility to develop infrastructure projects, involving the preparation of surveys and of technical, economic, financial and legal studies, aiming the inclusion in the PPP Program.

In this context, through the Decree of the State of São Paulo, the interested private shall present a petition with the main characteristics of the project to the President of the Management Council of the PPP Program or to the Secretariat of State competent for the developing of the project, in order to demonstrate its viability and relevance to the public interest. Beside the characteristics, shall be demonstrated by the interested private the advantages of contracting through PPP instead of common concession.

The presentation of a project by the interested private does not seals off the participation in the bidding, and, if the presented project is approved by the Public Sector, the reimbursement of the costs for its preparation will be provided by the winning bidder.

This new instrument (MIP) brings to the Public Sector the advantage of passing to the private sector all the executions costs of the studies and projects required by law for the opening of the bidding.

On the other hand, provides the opening of a new business field for those domestic and foreign investors interested in participating in state enterprises, thus contributing to the improvement of the quality and speed of projects contracted by the Government of Sao Paulo.

Given these benefits, the ideal would be if the Decree of the State of São Paulo did not restrict the use of MIP only to PPP projects, allowing it also in the common concessions, as a way of increasing the contributions of the private partner in state projects.