Maersk sues over $1 bln Brazil port auction

SAO PAULO, June 25: Global shipping groups are looking to Brazil’s courts to overturn competition rules that bar them from participating in the first round of bidding on a major new container terminal at Latin America’s largest port, due to take place later this year. Danish shipping group Maersk filed a lawsuit on Monday in Sao Paulo against Brazil’s marine transport authority (Antaq), and its general director, according to a document seen by Reuters.

The lawsuit called for “procedural corrections to ensure a fair process” to assign the Tecon 10 terminal at the Port of Santos.

The bidding rules, defined by Antaq, are under review by Brazil’s federal audit court (TCU).
The privately held MSC Group is also hoping for a change in the rules. Patricio Junior, regional investment director at MSC’s subsidiary Terminal Investment Limited, said TIL is considering a lawsuit if the TCU does not impose changes to the process.

The auction rules would bar Maersk, MSC and other operators of existing container terminals at Santos from the first round of bidding to build and run the new megaterminal, expected to require 5.6 billion reais ($1.0 billion) of investment.

That may open the door for Asian rivals or a local player such as JBS Terminais, the new port operating unit of Brazilian meatpacker JBS, which took over a container terminal at Itajaí, in southern Brazil, last year. JBS declined to comment.

Antaq, which has billed Tecon 10 as the biggest port auction in Brazil’s history, said its bidding rules are meant to promote competition. The agency said it had not yet been officially notified about the lawsuit and reiterated that the process is currently with the TCU, awaiting a decision.

If no valid proposals are received in the first phase of the auction, Antaq said operators of existing container terminals at Santos can bid in subsequent rounds, provided they divest their other holdings in the port complex.

Maersk declined to comment on the lawsuit, but called for a more transparent process to guarantee fair competition.

“Excluding companies with broad international experience, responsible for managing some of the most efficient ports globally, without thorough studies to support such a decision, significantly diminishes the project’s potential at Latin America’s largest port,” Maersk said in a statement.

Some heavy users of the Santos port infrastructure also voiced concerns about the rules constraining who can bid for Tecon 10.

Eduardo Heron, technical director of the Brazilian Coffee Exporters Council, said the group is advocating for “broad and unrestricted participation.”