Government and opposition reach agreement and Senate approves railway legal framework
Oct, 07, 2021 Posted by Ruth HollardWeek 202138
In a confusing vote on October 5th, the Senate approved the legal framework for a railways project. In practice, the project permits the authorization regime as a grant option for the exploitation of railways by the private sector — with more flexibility and without the need to go through the exhaustive procedure of public auctions.
The substitute was changed directly in the plenary after a last-minute agreement between the government and the opposition. This pleased institutions such as CNI (the national confederation of industry), but it raised doubts among government technicians about what the final text of the project should be. The proposal now goes to the Chamber of Deputies.
The initial assessment of government officials and sector entities is that the final version of the text preserves a good part of the 14 railway projects that were recently presented to the Ministry of Infrastructure.
These projects add up to R$ 80 billion in promises of contributions for expanding the current network by 5,360 kilometers of tracks, crossing 12 Brazilian states.
CNI celebrated the consensus. “In the opinion of CNI, the new milestone is an important path for the modernization of the Brazilian railway sector, which today is marked by low utilization and lack of efficiency in most of the network”, stated CNI.
“Right of way”
One of the main changes made to the text was suggested by senator Kátia Abreu (PP-TO). The amendment presented by it guarantees the so-called “right of way”, that is, third-party access to grids owned by others, for remuneration, in view of the idleness of the railway. This rule will apply, however, only to concessions and not to the new authorization regime; this is what worried some of the companies. The text also prohibits the unjustified refusal to transport cargo, except in the face of saturation or technical incapacity.
Source: Valor Econômico
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