Brazil seeks to overturn suspension of international bridge auction

The Brazilian government is racing against the clock to overturn the suspension of an auction for a concession for the bridge connecting São Borja in Rio Grande do Sul state with Argentina’s Santo Tomé.

The auction, originally expected to take place on January 7, was suspended by an order from audit court TCU.

The ruling came after local company Ponta Negra Soluções Logísticas e Transportes, one of the interested parties, claimed there were inconsistencies in the contract notice, including discrepancies in the traffic estimates used in the calculation of the contract fee.

The transport ministry will send clarifications to the court soon and seeks to hold the auction in the coming weeks, a ministry spokesperson told BNamericas.

The 1.4km bridge was opened in 1997 and is currently operated by concessionaire Mercovía. It is the only binational bridge under concession.

The current contract expires in August and cannot be extended without an auction.

As the legal process involving the auction and the assumption of a new contractor takes a few months, authorities in Brazil and Argentina are concerned that a new postponement could leave the bridge without a valid concession contract, potentially affecting trade between the two nations.

The minimum bid has been set at US$40.8mn, while capex and opex are estimated at US$99mn during the 25-year contract. The concession covers a 15.6km section of roadway, with 1.4km being the bridge itself and the rest access roads.

In addition to its importance for trade between Brazil and Argentina, the bridge is part of a route used for cargo transportation between Brazil and Chile.

According to the ministry, the bridge accounts for about 23% of trade between Brazil and Argentina and 40% of trade between Brazil and Chile.