Short summary in English:
A 30 year concession contract between SBC Valorização de Resíduos and the Municipality of Sao Bernardo do Campo, Brazil, for a public private partnership to offer an integrated system for solid waste management, including the service of urban street cleaning, implementation of a program to reduce and manage construction and urban waste, implementation and operation of a special unit to recycle, and the upgrade of the old landfill at Alvarega.
Short summary in Spanish:
Contrato de 30 años de concesión entre SBC Valorização de Resíduos y el Municipio de Sao Bernardo do Campo, Brazil, mediante el cual se forma una alianza público-privada que ofrece un sistema integrado de manejo de desechos sólidos que incluyen: servicio de limpieza de calles públicas; implementación de un programa de reducción y manejo de desechos urbanos y de construcción; implementación y operación de una unidad especial para el reciclaje, y la renovación de un antiguo relleno en Alvarega.
Parties: SBC Valorização de Resíduos, Developer and Operator, and the Municipality of São Bernardo do Campo, Brazil
The contract provides for a public private partnership to offer an integrated system for solid waste management, including the service of urban street cleaning, implementation of a program to reduce and manage construction and urban waste, implementation and operation of a special unit to recycle, and the upgrade of the old landfill at Alvarega.
Duration – 30 years (extendable for an additional 5 years)
Permits and Licenses - It is the responsibility of the developer to get al applicable license and permits, including complying with environmental regulations. Art 3.3
Payment – monthly concession fees Art. 4. These can be adjusted to reflect a discount if revenue from ancillary services, such as sale of recycled products, exceeds the projected amounts.
Contract may be reviewed to ensure an economic and financial balance, triggered if the volume of solid waste is above 15% of expected output, and in accordance with applicable law. Art. 4.6, 4.7, 4.10
Performance Guarantee - 5% of contract value. Art 5.0
All equipment necessary for the functioning of the facility will revert to the Municipality at the end of the contract term, in working order. Real estate continues to be of the Municipality. Art. 6.0
Termination – at termination due to 1) term of contract; 2) incapacity; 3) expiration; 4) rescission; 5) annulment of contract; or 5) dissolution of the Developer, Art 7., the contract provides for step-in rights for the Municipality over premises, equipment and contracts with 3rd parties, Art 7.3.
Terms of Reference and Bidding Bases contain provisions for universal services and service standards, non-performance of which gives the Municipality reason for termination, Art 7.3.
Penalties – complete non-performance: 5% of contract value and possibility of banning Developer from public bidding; non-compliance of parts of terms of reference 3%; inadequate performance (not meeting service standards); 0.1% of contract value per day of monthly fee until service standards are restored; 5% of contract value for key failures in the construction and operation of the recycling and energy re-capturing plant, along with other penalties. Art. 8.2, 8.3, 8.4, 8.5.
No incentive payments for surpassing quality standards.
Governing law – laws of Brazil
Forum for dispute resolution - Municipality of São Bernardo do Campo, Brazil
Reviewed by: Sara Sigrist