International Financial Law

post carries three assignments

Summarize your observations, early conclusions, reflections, and questions in this discussion.

Brazil turns to PPP for infrastructure investment. (2004). International Financial Law Review, , 1-28. Retrieved December 4,
2012 from http://search.proquest.com/docview/233199294?accountid=34899

Brazil hopes that a new law on public-private partnerships will help pay for improvements in areas such as energy
production and transport. Andrea Arean Oncala explains
Following the example of several European and Asian nations, Brazil has begun to consider creating partnerships between
government and the private sector. It is hoped that these public-private partnerships (PPPs) will serve as an alternative
means of promoting infrastructure development, ensure the economic feasibility of projects in Brazil and help increase
investment in energy production, transport and sanitation.
Under a PPP scheme, private partners are responsible for financing and operating projects while the government provides
certain guarantees and retains control over activities that are considered to be in the public interest. The concept
originated in the UK about 10 years ago, when local governments developed a programme known as the private finance
initiative, or PFI. Most of the profits from the privatization of UK government-owned companies had been spent, and the
PFI was intended to encourage investment in the public sector by raising funds from other sources. It is estimated that,
since 1992, pound(s)56 billion ($100 billion) has been invested in 617 PPP projects in the UK. According to some reports,
these schemes have on average scored 10% higher than previous projects in terms of value for money.
Belgium, Portugal, Germany, Spain, Finland, Japan, Norway, Sweden, the Netherlands and Ireland, as well as some Canadian
provinces and Chile, have considered or entered into PPP contracts. These have adapted the model used in the UK to fit
their own particular circumstances.
In public-private projects, the government is only obliged to pay if the private party achieves certain pre-established
results. The programme includes a strict and extensive preliminary analysis of the project so that, from the outset, the
scope of the work and what the public sector wants to accomplish is clearly set out and the expected results are
determined. Under a PPP scheme, the focus is on the project’s results, not on how the results are achieved, which gives the
private sector party more flexibility in carrying out the contract. At the same time, the risks involved in these projects must
be clearly stated and mitigated – and shared by both the public and the private sectors according to their respective
abilities to manage and control them.
PPP schemes also include a remuneration mechanism, tied to the private entity’s performance, under which the private
entity is only paid for services actually rendered and made available, according to certain quality standards and a time
schedule. The government is not obliged to pay more for services rendered at higher standards than requested, and may
also impose penalties on an operator that offers bad-quality services. The investment is thus supported by a private entity,
with long-term amortization through the revenue generated by the service or by remuneration paid directly by the
government.
PPP Bill
The Brazilian Congress is preparing a bill that will set out a model for the federal government to follow when undertaking
PPP schemes. Although the final drafting of the law might change, the version under discussion would enable public bodies
to engage in PPP projects with private partners to: (i) delegate (a) all or part of the provision or exploration of public
services, whether or not preceded by public works, and (b) the performance of activities originally under the public
administration’s competence, again whether or not preceded by public works; or (ii) to contract (a) the execution of public
works for the public administration, and (b) the execution of public works to lease or rent to the public administration.
Under the model proposed in the PPP Bill, partnerships providing public services will be subject to a permission or
concession agreement, which will be adjudicated by the public body in accordance with a bidding process. The public body
may: (i) offer the private partner certain considerations in addition to the tariffs from the user; or (ii) be the sole user,
whenever reasonably justifiable, thus encompassing projects that are not economically viable – an innovative feature that
builds on the options available under the Concessions Law 8.987/95.
The PPP Bill, as drafted, provides for contracts with minimum and maximum terms of five and 45 years, respectively, and
for projects with a minimum value of R$20 million ($7 million).
Under the Bill, PPP contracts must contain, among other things, clauses laying out: (i) the types of compensation paid
under the scheme and how contractual amounts can be adjusted; (ii) the frequency and adjustment system for (a)
maintaining the economic and financial balance of the contracts, and (b) the use of the most recently available materials
and techniques to render the services under the partnership; and (iii) the events that qualify as default on the part of the
public partner, and the types and the time limit for regularization. In addition, the contracts may establish the possibility
of the public body sharing the earnings arising from the reduction of the credit risk of the partnership financing.
The Bill also sets out how payments are made to the public body as the terms and goals of the PPP are fulfilled. These
payments may vary according to the performance of the private partner as it carries out the project in relation to the goals,
quality and availability standards established in the bid notice under which the contractor is selected. These payments can
be made by: (i) bank order (in cash); (ii) assigning non-tax credits; (iii) granting rights to the public administration; and (iv)
granting rights over public assets.
Under the model likely to be adopted in Brazil, contractors will be selected through a controlled bidding process, the
features of which differ from those in Law 8.666/93, the General Administrative Contracts Law, but are similar to the model
used by the World Bank.
Under the Brazilian method, a preliminary phase would comprise a series of studies of the project’s feasibility, a detailed
schedule for the project and the bidding process and, subsequently, the definition of the project through identifying and
assigning risks, ascertaining cost and calculating benefits. The contractors would then be selected through a bidding
process under the pre-qualification system. The bidders may present new and successive price proposals until one is
declared to be the winner under the terms and conditions stipulated in the bid notice. The criteria for selecting bids may be
based on the minimum price/technique combination, or on a minimum compensation amount set by the public body.
From the private sector’s point of view, one of the most important and attractive aspects of the PPP Bill is that the public
body involved in the schemes guarantees to secure compliance with the obligations it assumes under PPP contracts,
relating to the private partner, and those assumed by the private partner with third parties.
Private partner guarantees
PPP projects are subject to a detailed and precise preliminary analysis, involving public hearings and in-depth studies to
identify the risks involved in the underlying project. Upon approval, PPP contracts (which are based on detailed budget
planning) will have priority over other obligations assumed by the public body for public works not contracted under the
PPP Bill. In projects that provide public services, the public entity can unilaterally terminate the PPP contract only on the
grounds of the public interest.
Furthermore, the National Congress must pass a specific authorizing law to enable the public body to terminate the
contract without affecting any compensation previously earned under the scheme.
Payment obligations assumed under the PPP contract may be secured against certain revenues tied to the underlying
project, such as through a surety bond, special fund or the subscription and acquisition of quotas in a trust fund to
promote PPPs. The executive branch will regulate the trust fund.
The resources deposited in the PPP Promotion Trust Fund, which will be created to ensure compliance by the public body
with its obligations under the PPP contracts, will be separate from the Treasury’s general account and managed by
financial institutions that are, directly or indirectly, controlled by the government. The PPP Promotion Trust Fund may be
composed of: (i) appropriations provided for in the budget and additional credits; (ii) transfers of rights and non-financial
assets; (iii) personal and real property; and (iv) funds from other sources.
Guarantees to the financier
In addition to the favourable private partner guarantees that are provided for in the PPP Bill, specific guarantees for the
financiers of PPP projects are also available. These guarantees will presumably only have privity of contract with the
private partner. These financier guarantees, as they are known, will include the possibility that the public body will directly
pay the amounts originally owed to the private partner to the institution that financed the underlying PPP project. Also, the
special purpose company (SPC) – which the private partner will be required to set up to carry out PPP projects – may offer
the rights arising from the PPP contract to its financiers as payment guarantee, up to a level that does not impair the
operation and continuity of the works and services.
State experiences
Before the Brazilian federal government’s approval of the PPP Bill, the governments of certain Brazilian states – Sao Paulo,
Minas Gerais, Goias and Santa Catarina – had already approved their own state laws regulating PPP programmes. These
state governments are also implementing pilot projects focusing on transport, the construction of public jails, water
facilities and sewage facilities.
According to Sao Paulo law, for example, the guarantees provided to private partners in the state differ from the private
partner guarantees of the federal government project. In Sao Paulo state, instead of creating a trust fund, a legal entity
(stock corporation) called a companhia paulista de parcerias, or CPP, is created. The CPP enables the implementation of
PPP projects within Sao Paulo state and manages the equity assets transferred to it as guarantee of the obligations
assumed by the relevant Sao Paulo public administration division under the Sao Paulo state PPP programme. These assets,
the liquidation or encumbrance of which could be used to secure compliance with the obligations assumed by the Sao
Paulo public administration division under the PPP contracts, may include real property, shares of state-owned companies,
and government bonds.
Other contracts
Under the present legislative regime, public contracting of services or execution of public works is governed by: (i) the
General Administrative Contracts Law (8.666/93); or (ii) the Concessions Law (8.987/95).
Contracts issued under the General Administrative Contracts Law that govern the execution of works, services, purchases,
sales and leases on the part of public bodies typically include an absence of private funding, remuneration tied to the
existence of budgetary funds, payments that are to be carried out during the execution of the programme and a contractual
term limited to five years.
In contracts issued under the Concessions Law, which applies only to services and public works programmes, remuneration
is paid solely for carrying out services, is based on applying the tariff system, and is paid by the service’s end user.
Although the PPP model has been classified as a type of elaborate concession agreement meant for use in larger projects, it
can also be applied to works and services programmes where revenues cannot be obtained by collecting tariffs. It can also
be applied to partnerships between private entities and government-owned companies engaged in utility services aimed at
developing infrastructure.
Accordingly, the income-generating capacity of each public investment will suggest the preferred model for carrying out
that project. PPP projects occupy a position between those with no capacity for generating income and, therefore, with no
self-sustainability, which will proceed under traditional public works contracting (as governed by Law 8.666/93) and those
that are financially self-sustaining, which are executed under the Concession Law.
Moreover, the public-private partnership differs from privatization, under which the assets are sold, and the title to the
operation of a continuing concern or activity is transferred, to a private entity. These partnerships only delegate the right
to render a certain public service or infrastructure work for a certain period to a private operator.
PPP schemes can also be confused with more traditional project financings. Project finance is a kind of financial scheme
intended to create estimated or established cash flow using the project’s assets, with little or no support on the part of
sponsors, the parties being responsible for identifying the estimated risks and attempting to reduce them. This model is
best used in relation to public services with a viable outcome and a legal or natural monopoly. However, as the public
interest is the most important factor in PPPs, there will be no cash flow or it may be unpredictable or even insufficient for
the scheme to be implemented.
Public interests prevail over individual interests in PPPs because these schemes involve administrative contracts governed
by public law, in contrast to project financings that are governed by private law. Private law requires only equivalence
between private and public entities insofar as the public interest does not affect the success of the project. On the other
hand, neither model involves the transfer of assets to the private sector, as occurs in privatizations. Both types of
partnership are an attempt to better manage public assets through private partners and optimal budget disbursements.
In light of the urgent need for infrastructure investments, both the public and private sectors in Brazil consider PPPs
fundamentally important to attract much-needed foreign capital to the country. The approval of the PPP Bill is expected to
enable investments in the infrastructure sector of up to R$36 billion, which is equivalent to the amount forecast in the
federal government’s Plano Plurianual for 2004 to 2007.
Andrea Arean Oncala is a lawyer with Felsberg, Pedretti, Mannrich e Aidar Advogados e Consultores Legais in Sao Paulo,
Brazil

2:Creativity&Innovation

Group Creative Problem Solving Project – Having grasped a holistic understanding of C&I from part 1. This is an
opportunity to apply the skills of C&I (especially divergent thinking) and then reflect on your learning (appraisal). The
emphasis is to apply creative problem solving techniques to an ?open ended problem?. The key here is to identify a
problem/challenge/issue and then examine it from multiple perspectives, prior to coming up with potential solutions. Do
not frame the problem too narrowly this goes against the grain of divergent thinking and will show that you have not
grasped a full understanding of C&I from part 1. We are looking for clear evidence of how you have applied C&I so please
include in your appendices the tools that you used and the results. If you go to the ?web links? section of BB the first three
links are excellent resources for C&I tools. In addition the chapter from Burns (2011) also on BB is very good.
If you are stuck for ideas for which challenge use C&I techniques firstly individually and then in groups to generate ideas
e.g. you could do a brainstorm individually and then share your ideas with your group. For example think of a challenge or
problem you are aware of, or under-utilised resources.
For the above go to the OpenIDEO site for more details. There are also three other sites listed in the Challenges section on
BB. Other ideas include:
Consider what products and services will be needed in ten years time i.e. 2022. Another way to think of this is that you are
in the year 2022. In which world do you live? Where do people work? What are the needs and goals of people? What is their
daily routine? You could link this to a particular location, so for example what will Bradford look like in ten years time and
what will people?s needs be.
Some of you are thinking in terms of products and services, which is fine but BEFORE you get into convergent thinking, you
need to use divergent thinking and use multiple perspectives. For example one group is looking at obesity and energy (I
am deliberately being vague) instead of focusing on products immediately REPHRASE the problem. What is the real issue
(zoom out) and having EXPLORED the problem look for C&I solutions (ARTIST) before making decisions about possible
solutions. The key is to demonstrate that you have applied divergent (Explorer and Artist) thinking.

Burn?s (2011) highlights a variety of techniques you could use e.g. Brainstorming, Analogy, Attribute Analysis, Gap Analysis.
In addition the ?mind tools? website is an excellent source of tools. As is the presentation by Kevin Byron ?Creative Problem
Solving? and the material from Creativity Trainer II.

NOTE 1? The purpose of working in teams is to enhance creativity, the appraisal is of your learning from the activity which
is individual. Description of what you did as a group can be the same for the group and of course the results of your
divergent (and convergent thinking) can be the same.
Having identified a problem to work on as a group you then spend three to six hours as a group working on this. Your
approach should be that you want to go through the Creative Process in these meetings.
– Generating Knowledge and Awareness ? EXPLORER
– Incubation Process & Generating Ideas ? ARTIST
– Evaluating Ideas – JUDGE
– Discussing Implementation Challenges – WARRIOR
As a group you can appoint different individuals to lead different sessions. There job would be to facilitate the session and
decide which tools to use. A possible format deploying five meetings could be (some of this work can be done online).
Meeting 1 ? Explorer
Meeting 2 ? Explorer
Meeting 3 ? Artist
Meeting 4 – Artist
Meeting 5 ? Judge & Warrior

At the end of the sessions you will have a record of the results and tools used, it is this that you need to APPRAISE, i.e. what
you learnt through the process and viability of proposed options/solution(s). In groups you are using the tools and
recording results and as individuals you evaluate and reflect i.e. APPRAISE. The sessions should be whacky and fun,
remember humour plays a very important part in being creative.

***Important: I chose the project about west of talent and the spider map Inside the annex.

Part 2 ? Learning & Reflection

Problem, Challenge, Activities (PCA?s) ? This is where you reflect on your overall experience of what you have learnt. This
includes the essay, the group problem solving project and other challenges and relevant classroom activities. The Log &
Personal Progress Diary will be a record of all activities you did as part of the module, in class, in your ?team? or
individually. Here you will make your overall observations and recommendations of what you have learnt about being
creative and innovative over the course of the module, including recommendations for developing your capabilities.

A better example…
?During the first 3 week of the module “Exploring Enterprise and Self Employment” I found it very useful to explore my own
abilities and get new experience especially in group activities.
So far I have been a good team member – respecting and supporting others, agreeing and finding the connection with every
one, listening to the group members about their opinions and ideas.
… I am very helpful, I volunteered to do some charts for report and I think that it is important if you care about group
progression and results. Also I found it easy to communicate with every team member both face to face during the lecture
sessions, group meetings and electronically by emails.
Also I am good at idea generation and one of mine ideas was chosen as the group three best ideas for feasibility study.?
4 levels of reflection
Level 1 – Descriptive writing
Documenting an experience
?We held a meeting to discuss the project. I made a presentation on the staffing structure.?
Level 2 – Descriptive reflection
Reflecting on an experience from a personal perspective
?We held a meeting to discuss the project. I made a presentation on the staffing structure . I felt well prepared and think I
delivered it confidently.?
Level 3 – Dialogic reflection
Reflecting on an experience from a number of possible perspectives
?We held a meeting to discuss the project. I made a presentation on the marketing plan. I felt well prepared and think I
delivered it confidently. When I asked for feedback, there were some great comments, but it also suggested that the people
at the back of the room couldn?t hear me and I went through my Powerpoint so fast they struggled to keep up. I then
watched the recording and agree with what they say. Perhaps I was overconfident and rushed. What I plan to do is … ?
Level 4 – Critical reflection
Reflecting on experiences from a number of perspectives and noticing patterns in thinking, feelings and behaving then
exploring possible assumptions, beliefs, prejudices and values that may underpin such patterns
?… Some people disagreed with my proposed structure. This has made me think about my previous experience of working
for a commercial company with a hierarchical structure and how this influenced my proposal today. However, I realise that
alternative structures may be more appropriate for a business functioning in a charitable sector and with a very different
culture (Mullins, 2007). Many of the audience members come from that background. What I propose to do ..

3:Search and Seizure

1700s Reasoning and 2000s Technology (A

The term paper executive summary conveys to fellow students the most important lessons you have gleaned by studying
the administrative and legal implications of your constitutional provision. The link below discusses how to prepare an
effective executive summary. Use this or other sources to produce a public document conveying the essentials of what you
have learned. (https://www.csun.edu/~vcecn006/summary.html)

Creativity&Innovation