With the resumption of trials in the face-to-face plenary of the Superior Court of Justice (STJ), the controversial case of the Public-Private Partnership for public lighting in the city of São Paulo is scheduled for this Wednesday. The action refers to a 2016 tender that resulted in a R$1.6 billion more expensive contract. The rapporteur is Minister Jorge Mussi.
The dispute revolves around two consortia: FM Rodrigues/CLD, the current provider of the service, and Consórcio Walks, which presented the cheapest proposal, but was disqualified from the competition. The dispute counts on the performance, as a lawyer, of the former president of the Republic Michel Temer, who is part of the legal team of the business group excluded from the bidding.
The analysis of the merits of the case had been suspended by the rapporteur until the Court resumed the face-to-face judgment agenda, suspended due to the covid-19 pandemic. The case arrived at the STJ in April 2019 and remained unmoved for two years.
The competition was launched during the administration of Fernando Haddad (PT) in the City Hall of São Paulo. From the beginning, the dispute had problems. To give you an idea, although the bidding was launched in the administration of Fernando Haddad (PT), in 2016, the envelopes were only opened in January 2018, during the administration of the then mayor João Doria (PSDB). Neither of them is obviously involved in the case.
Once the offers were revealed, there was a very high difference in values between competitors. The Walks Consortium offered R$5.3 billion for a 20-year contract. The FM Rodrigues/CLD Consortium, in turn, presented a proposal of R$ 6.9 billion under the same conditions.
However, in an administrative proceeding, in February 2018, the Lighting Department of the Municipality of SP (Ilume) declared the Walks group to be disreputable and replaced it with the FM Rodrigues/CLD Consortium.
The case was taken to the courts. At the time, recordings obtained by CBN radio indicated the existence of a scheme to benefit the Consório FM Rodrigues/CLD. The Special Action Group to Combat Organized Crime (Gaeco), of the Public Ministry of São Paulo, investigated the complaint. At the time, Doria fired the secretary whose audios were leaked.
In December 2018, the São Paulo Court of Justice recognized that the Walks Consortium should not have been excluded from the bidding process and ordered the complete cancellation of the competition due to the allegations of corruption.
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In 2019, the case reached the STJ. The vice president of the court, Jorge Mussi, overturned the TJSP’s injunction, without going into the merits of the case, and threw the issue up for debate in plenary.
While the case is not resolved by Justice, the City of São Paulo is obliged to proceed with the emergency contract, paying an additional R$ 346 million per year. The estimate is that the overprice reaches R$ 10 million per month.
What does the city of São Paulo say?
Sought by the column, the prefecture reported:
“The Public Services Regulatory Agency of the Municipality of São Paulo – SP Regula informs that so far, about 602 thousand luminaires, equivalent to 95% of the entire municipal lighting park, have already been remodeled to LED lamps, a technology that ensures greater luminosity and lower energy consumption. The expectation is that all lighting in the municipality will be modernized with LED by 2024.
The legal superintendence of SP Regula, the autarchy currently responsible for the management, regulation and inspection of the Public Lighting contract for the Municipality of São Paulo, informs that the City Hall has no expectations regarding the aforementioned judgment scheduled for Wednesday, except for the that the STJ decides in a technical way, as is its own.
The Municipal Lighting Public-Private Partnership (PPP) contract, which has a duration of 20 years, has been running since August 2019, and provides for the services of remodeling, expansion and maintenance of the public lighting network in the city.
Regarding a re-bidding when the audios were leaked, there is no news of the existence of any type of jurisdictional element that removes the presumption of legality of the acts practiced at the time.
The Municipal Attorney General’s Office (PGM) informs that the expectation of the municipality of São Paulo is for the maintenance of the decision that granted the request for suspension, with the improvise of the internal grievance “.
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