One year on from the London 2012 Games there has been renewed celebration of the success of those Games – and also a growing sense of anticipation for the next Games in Rio which are now only 3 years away. UK businesses can of course participate in tender processes for contracts to be awarded in connection with the Rio 2016 Olympic and Paralympic Games.  Whilst undertaking such a task in a different jurisdiction, with a different language, can seem daunting, CMS (London and Rio offices), in conjunction with both UK Trade & Investment (UKTI) and the Law Society, have produced a toolkit to guide UK businesses though the various Brazilian procurement processes.  The toolkit was launched at UKTI’s Global Sports Project Seminar: Rising to the Challenge – Delivering the London 2012 Business Legacy, held in London on 18th July.

Rio 2016 – Contracting Bodies

Contracts in connection with the Rio 2016 Olympics will either be awarded by Brazilian government entities or the Organising Committee for the Rio 2016 Olympic and Paralympic Games. 

Infrastructure contracts, including contracts for the construction of stadiums, other buildings and transport links (such contracts often being referred to as legacy contracts) will be awarded by Brazilian government entities. 

The Organising Committee, a non-profit organisation responsible for promoting, organising and delivering the games, will award contracts for the delivery of goods and services and non-permanent structures.   The largest procurement category of contracts being tendered (as a percentage of the Organising Committee’s budget) is for temporary construction, with transportation contracts coming next, closely followed by contracts for materials and services for events.  Other categories of contract to be awarded include (amongst many others): outsourced services, catering, facilities, furniture, and non-sport and IT equipment.

Rio 2016 – Procurement

Contracts awarded by Brazilian government entities are subject to the general public procurement regime in Brazil under the Public Procurement Act and the tender process will vary depending on the contract being awarded.  In limited circumstances, where a contract is considered urgent, the procurement process may be accelerated under the Differential Public Procurement Regime.  Most of the main construction and infrastructure projects for the Rio 2016 Olympics have already been tendered.  Indeed, as some of the World Cup stadiums will also be used for the Rio 2016 Olympics, much of the large stadium work is now completed or is at an advanced stage.  However, new projects and tender processes are being launched and will continue to be launched on a rolling basis subject to need (last week, for example, the tender process for the construction and operation of the Tennis Centre was launched).

The majority of the Organising Committee contracts will be awarded in 2014 and 2015.  Because the Organising Committee is a private entity, it is not subject to Brazilian public procurement rules and will therefore follow a simpler process than Brazilian government entities, starting with an online pre-registration, which is now open.  Details of the registration process are set out in the toolkit.

The Toolkit

The toolkit has been launched to provide UK businesses with practical insight into the various procurement processes and to encourage and support UK investment in the Rio 2016 Olympics and Brazil. 

Among other things, it explains the procurement processes to be followed by the Organising Committee and Brazilian government entities, the likely timescales involved, company formation requirements, UK equivalents to Brazilian documents required for bidding and the process to be followed if a Brazilian document does not have a UK equivalent, legalisation requirements and the way in which a local representative should be appointed,.  

The toolkit is of course not intended to be a substitute for legal advice, which should always sought by any UK entity interested in doing business in Brazil.  In particular, even where there are no specific requirements in the relevant procurement rules which stipulate that a bidder must form a company or enter into a consortium with a Brazilian company, there may still be good commercial, legal, financial or tax reasons for establishing a local presence in Brazil, whether this is by way of the formation of a Brazilian subsidiary, a consortium with a Brazilian company, a more traditional joint venture structure or some alternative approach, and professional advice covering the range of market entry options available will be crucial. 

The Rio 2016 Olympics represent a great opportunity for UK businesses wishing to invest in Brazil.  CMS has leveraged its position as the only UK law firm with an office in Rio to meet and discuss the procurement process with the representatives responsible for organising and delivering the games.  This unique advantage has enabled us to produce a toolkit which is focussed on the practical issues that are essential for any UK business looking to participate in the tender processes.

The toolkit can be provided by the UKTI on request by sending an email to sport@ukti.gsi.gov.uk