Public Procurement legislation expressly forbids public agents from allowing the public tender notice to contain any conditions that may restrict or frustrate in any way the competitive nature of the tender. Preferences or distinctions between bidders based on nationality, domicile, or other conditions irrelevant to the object of the tender are forbidden.

As a rule of thumb, public procurement rules in Brazil aim to obtain the best possible proposal to the public entities (usually meaning the most advantageous one from the economic standpoint) by an objective and fair competition between bidders.

However, Federal Law 12,349/2010 introduced a possibility of differentiated treatment between domestic and foreign companies. This legislation establishes beneficial treatment for certain products manufactured in Brazil or services provided by Brazilian companies in public tenders. Under this rule "nationally manufactured products" are the ones produced in the Brazilian territory complying with the "basic productive processes" or other regulations regarding a product's origin as defined by the Federal Administration. On the other hand, "national services" refer to any service performed in the country under the conditions determined by the Federal Administration.

The preference for national services or products can be up to 25% of the price offered by a foreign competitor. The exact percentage must be defined in the request for proposals.

Yes. Both Law 8,666/93 and Law 13,303/16 allows the public entity to conduct prequalification of competitors. The prequalification aims to allow the competitors to obtain the approval of their technical qualification and some of the required documents prior to the public tender procedures.

The public entity must previously allow the prequalification and will analyze the documentation presented by the potential bidder in order to determine its validity. In the cases were the prequalification is accepted, the mechanism can be specially relevant for companies that have de desire to participate in multiple tender procedures before the same public entity.

Yes. Companies debarred from participating in public tender procedures will be listed in a "blacklist" in the Transparency Portal called National Registry of Disreputable or Suspended Companies. Law 8,666/93 provides that, due to total or partial non-performance of the contract, the Administration may apply to the private party a temporary suspension from participation in public tenders and prohibition to hire with the Administration, for a period not exceeding 2 years. Note that, in case of sanctions applied by the Courts, due to Administrative Improbity, or sanctions applied by the Federal Accounts Court, such debarment period can be of up to 5 years. In those cases, the law does not determine any rehabilitating procedure in order to suspend the debarment decision.

It is possible, however, for a company to be subject to declaration of unsuitability to bid or enter into contracts with the Public Administration, sanction applied with the rule that rehabilitation is promoted before the same authority which imposed the penalty, which rehabilitation should be granted always when the contractor indemnifies the Administration for the resulting losses and after expiring the duration of the penalty imposed pursuant to the abovementioned.

Moreover, it is also important to stress that the legislation only states for the maximum duration of the penalties, which reserves to the Public Administration the duty to analyze each particular case in order to establish a sanction correspondent to the infraction committed, using, for that, the principles of reasonableness and proportionality.

Yes. Both the Law 8,666/93 and Law 13,303/16 prohibits the companies involved in the set-up of public procurement procedures to participate of the same procedure.

On the other hand, in case of concessions (Law 8,987/95 and 9,074/95), public and private partnerships (Law 11,079/04) or contracts under Differentiated Contract Regime (Law 12,462/11), there may be exceptions, under which the authors or those responsible economically for the projects, surveys, investigations and studies (Basic Design) presented may be allowed to participate directly or indirectly in the public tender procedures.

Note, however, that the request for proposals and other public tender documents are always of sole responsibility of the public entity. Any participation of private parties in preparing such documents may be deemed as a violation to Public Procurement Legislation and subject such private parties to sanctions (including criminal).

Consortia can be allowed by the public entities, which needs to be expressly determined in the request for proposals. Note that all companies that are part of a consortium will be jointly liable before the public administration for the submitted bid and for performing the contract in case of awarding.

Also, Brazilian anti-trust law (Law 12,529/11), sets forth it is an economic infraction the act of agree, combine, manipulate or adjust with competitor, in any form, prices, conditions, advantages or abstention in public biddings. Therefore, if the bid call document do not expressly permit the "consortium", any form of combinations between the bidders will be an economic infraction and can also be framed as a crime under the provisions of Law 8,666/93.

At first glance, the change of the consortium members could be considered as an violation to the principle of isonomy and competitiveness. However, in exceptional cases and on a case-by-case analysis, the public administration may accept, under the execution of the competent contract amendment and as long as the new member also complies with the qualification requirements on the RFP, the alteration of the consortium members due to unforeseeable and/or new facts (not occurred before the bidding procedure).

The legislation prevents no natural or legal person from being part of the corporate framework of more than one legal entity. The mere fact that companies with partners in common participate in the same procurement procedure does not allow the Administration to conclude that such action will occur in a fraudulent way or even to frustrate the bid objectives.

In case of participation of companies belonging to the same partners or the same economic group in the same public procurement, it will always be necessary to analyze the documentation provided by the companies to examine their legal and technical capacity, in order to verify their independence from each other and that no public procurement rule was violated (in special those related to equal and fair competition).

Note that, usually, when the requests for proposal allows for the participation of consortia, they determine that companies cannot bid for the same object or services under two different consortia.