Godofredo Mendes Vianna February 26 2014 Agency publishes rules for drafting lease projects for port facilities Kincaid | Mendes Vianna Advogados | Shipping & Transport - Brazil Godofredo Mendes Vianna Shipping & Transport On January 8 2014 the National Agency for Waterway Transportation published Resolution 3,220, which sets out procedures for the elaboration of lease projects and defines the methodology for the reinstatement of an economic equilibrium for lease contracts for port areas and facilities at organised ports.According to the rule, the leasing of port areas and facilities must always be preceded by a study of technical, economic and environmental feasibility, which assesses the venture and will serve as the basis for the bidding process. The study should include the following elements:an economic and financial analysis of the venture, based on revenues and expenditure related to the operation of the services to be performed;a valuation of the lease or the service tariffs to be charged, as applicable;a technical feasibility analysis, including the design of infrastructure and superstructures, location, operating cash flow and its articulation with other modes of transport; anda preliminary analysis of environmental sustainability, which should take into account the results of engineering studies, any analysis already conducted by a competent environmental agency and the port's operational licence, where applicable.When preparing for the leasing of port areas and facilities, macroeconomic forecasts (whether conservative, intermediate or optimistic) must also be taken into account. These will serve as a basis for cargo handling and/or passenger movement projections.With regard to the revision of contracts, the rule provides that the lessee or grantor may request the contractual recovery of the economic equilibrium in cases in which any of the risks expressly undertaken by the grantor materialise, under the terms set forth in the lease contract and in line with the economic consequences for either party.A request for review made by the lessee must be presented within two years of the risk materialising. The request must be accompanied by a technical or expert report that demonstrates the economic impact (whether actual or projected) that derived from the event, as well as all documents necessary to demonstrate the applicability of the claim.A contractual review of the lease contract, when contractually provided for, will be made every five years, counted from the date on which the lease contract was signed, unless a specific contractual provision states otherwise.The process of reinstatement of the economic equilibrium will be made in order to neutralise the negative and positive impacts of the event that gave rise to the recovery, which will be formalised through an amendment to the lease contract.The economic reinstatement of the lease contracts may take place at the discretion of the grantor, using the following means:by increasing or reducing the financial amounts provided for in the lease contract (this option is preferable);by modifying the lessee's contractual obligations;by extending or reducing the term of effectiveness of the lease contract; orthrough an indemnity payment.For further information on this topic please contact Godofredo Mendes Vianna at Kincaid | Mendes Vianna Advogados by telephone (+55 21 2276 6200), fax (+55 21 2253 4259) or email ([email protected]). The Kincaid | Mendes Vianna Advogados website can be accessed at www.kincaid.com.br.