By Brazil Stock Guide – Brazil’s Federal Audit Court ordered the Ports and Airports Ministry and waterway transport regulator Antaq to seek a fresh review before making structural changes to concession models that have already been assessed by the court but not yet auctioned.
The ruling, reported by Valor Econômico, was approved by the court’s plenary on Tuesday (19) in a case involving the concession of the access channel at the Port of Itajaí. Its impact, however, may extend to other port projects, including Tecon Santos 10, a major container terminal planned for the Port of Santos.
The decision bars the government and Antaq from changing core elements of concession models after the court has issued its opinion. Any modification to structural terms must be submitted again to the Federal Audit Court, known in Brazil as TCU.
The court listed as structural changes any adjustments to the competition regime, bidding participation rules, risk allocation matrix, tariff structure and remuneration model. It also included any change capable of affecting the contract’s financial balance, the level of competition in the auction or the distribution of risks between the parties.
Justice Walton Alencar, the case’s rapporteur, said the model submitted by the government to the court must correspond to the project eventually taken to auction. Without that, he said, “the manifestation of external control loses the object on which it should act, or, more precisely, falls upon an object that dissolves in the interval between the ruling and the publication of the notice.”
Alencar said that if the Executive branch substantially changes the structure of a project after review, the matter must return to the court.
“I consider that it is not lawful for the Presidency of the Republic and the Executive branch in general, through all ministries, to submit a given object to the court’s review for bidding, for the court to assess that object as delivered, and then, after the object is returned so the Executive can proceed with the auction, for that object to be transformed into a third object completely different from what was reviewed by the Federal Audit Court,” he said. “That object would have to return again to the Federal Audit Court. I am not referring to tangential aspects, but to essential aspects.”
The ruling comes as the government reopens discussions over the auction model for Tecon Santos 10. The project had already been reviewed and cleared by the court’s plenary, with recommendations, but renewed debate over bidding rules has created uncertainty in the sector and raised concerns about the auction timetable.
The dispute intensified after Brazil’s presidential chief of staff office recommended removing restrictions on shipping companies, known as carriers, from participating in the Tecon Santos 10 auction. The proposal also allows current container terminal operators at the port to bid, provided they divest their equity stakes in the operations they already control at the port complex.
That approach differs from the model previously under discussion. Antaq had initially proposed holding the auction in two stages, with restrictions requiring companies already operating in the region to participate only in the second phase if no bidders emerged in the first. TCU went further and recommended extending the restriction to carriers to prevent vertical integration by shipping companies.
A technical note signed by Brazil’s Investment Partnerships Program, known as PPI, reignited the debate over the auction format. In an interview with Valor, Antaq Director-General Frederico Dias had already indicated that if the government adopted a model different from the one approved by the regulator or recommended by TCU, the process could be sent back to the audit court.
According to Valor, Antaq’s initial assessment was that the model backed by the presidential chief of staff office would amount to a third format that had not gone through the appropriate review process. The new TCU decision strengthens the view that any structural change to the auction may require another formal assessment before the bidding notice is published.
Industry groups have split over the possible changes. On Monday (18), associations representing private port terminals, foreign trade and logistics supported the PPI technical position, arguing for broader competition in the auction. They also called for speed in completing the model and holding the auction in 2026.
On Tuesday (19), 16 productive-sector entities released a statement supporting the more restrictive model approved by Antaq and recommended by TCU. The group backed the publication of the bidding notice and the swift auction of Tecon Santos 10.
“One cannot allow new bureaucracies and/or opinions to create legal uncertainty and delay a project so vital to the economy and national sovereignty,” the entities said in the document.
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