Law of public biddings
According to the Brazilian Federal Constitution, article 37,
item XXI: "With the exception of the cases specified in law,
works, services, purchases and disposals shall be contracted by public
bidding proceedings that ensure equal conditions to all bidders, with
clauses that establish payment obligations, maintaining the effective
conditions of the bid, as the law provides, which shall only allow the
requirements of technical and economic qualifications indispensable to
guarantee the fulfilling of the obligations." The regulatory law is Law
Number 8666, 21st June, 1993.
The Law forbids preference to or differential treatment between Brazilian and foreign companies. However, when local
foreign competitors offer equivalent conditions in terms of price,
quality and delivery time, the law ensures preference for: goods
produced or supplied by a Brazilian firm of national capital; locally
produced; and produced or supplied by Brazilian firms. The comments
below are a very superficial highlight of some important topics of the
- Article 1 mentions the entities subject to the
law: all the three branches; all the three levels of government
(Federal, State, and Municipal); all agencies and foundations; all
public companies, including those with private participation (this means
that big businesses like PETROBRAS, Banco do Brasil and others are
subject to the law).
- Article 3 mentions that the
nationality of the bidders will be considered only as a tie-breaking
Brazilian and foreign companies compete
equally. Also, article 3 states that all the bidding process is open to
the public, except, of course, for the value of bidding while not
- Article 4: all bids are in national
currency, except in the cases prescribed in article 42 (international
- Article 24 states the situations where
bidding is not mandatory. Some examples: purchases of small value (as
defined by law); emergency situations which put people or premises in
risk; when previous bidding processes had no bidders; to purchase or
rent specific buildings; several others.
- Article 25
states situations when a bidding process is not feasible. Examples:
there is only one possible contractor for a given product or service
(electricity supply, for example); a professional is so outstandingly
better than all the others that a bidding competition would be
- Article 45 states that, besides the price bid, technical factors may also define the winner.
Internet: <www.V-brazil.com/business> (adapted).
Based on the above text, judge the following items about biddings regulated by Law Number 8666, 21st June, 1993.Contracts to deal with emergency situations may be awarded without a bidding process.