EXTRAORDINARY NEWSLETTER RESOLUTION 471 OF 2020 COVID – 19

On March 20, 2020, the National Government announced a mandatory preventive isolation due to the health emergency caused by COVID-19 from Tuesday, March 24 at 23:59 to Monday, April 13 at 00:00 (the “Mandatory Preventive Isolation”). For this reason, on March 22, 2020, Resolution No. 471 of the Ministry of Transportation – National Infrastructure Agency (“Resolution 471”) was issued, establishing as a transitional measure the suspension of terms in the administrative and contractual proceedings before the National Infrastructure Agency (“ANI”) and other administrative measures, for public health reasons.

The above-mentioned regulation states mainly: (i) the suspension of terms for certain actions before ANI; (ii) the suspension of certain contractual obligations of concession agreements in the road, port, rail and airport transport service modalities, of public construction agreements for railways and of auditing agreements; (iii) specific rules to be followed during public procurement processes; and (iv) rules regarding the use of the quality management procedure.

In addition, we believe it is important to emphasize that the recitals of the resolution expressly indicate that the health emergency caused by the presence of the COVID-19 virus in the national territory constitutes a force majeure, external, irresistible and unforeseeable event.

Resolution 471 ordered the suspension of terms from March 24, 2020 at 11:59 p.m. until April 13, 2020 at 00:00 a.m. of the following acts carried out before ANI:

(i) Administrative sanctions procedure; (ii) Cure periods in progress and procedures for new applications; (iii) Remedial plans; (iv) Coercive collection processes; (v) Contractual settlements; (vi) Review and evaluation of Public-Private Partnership (APP’S) projects in the pre-feasibility and feasibility stage, including the maximum time frame for delivery of the project in the feasibility stage; (vii) Procedures for applications for port concessions, dock concessions and contractual amendments in port matters, including, among others, summonses to public hearings, issuance of resolutions setting conditions and granting concessions; (viii) Requests for the modification of concession agreements for any type of transport, public construction agreements for railways and financial control agreements, except in those cases which are exceptionally recommended by the Agency’s Contracting Committee, following a request and justification by the respective authorizing officer for expenditure; (ix) Reversion processes; (x) Requests for certification of agreements and of any other type; (xi) Procedures of Eventos eximentes de responsabilidad and land, environmental and networks force majeure; (xii) Procedures for permits for the use, occupation and intervention of road and rail infrastructure under concession by the public entity, except in relation to the steps to be taken in an emergency in accordance with the provisions of paragraph three of Article 5 of Resolution No. 716 of 2015. In events that, due to extreme necessity, a permit must be issued for the use, occupation and intervention of the road and rail infrastructure under the responsibility of the public entity, the correspondent area must carry out the corresponding action in accordance with the procedure set forth in Resolution No. 716 of 2015;  (xiii) Procedures for the issuance of concepts for the location of service stations; (xiv) Procedures for permits for extra and/or extra-dimensional loads; (xv) Procedures for the closure of roads due to works or for sports and/or cultural events; (xvi) Verification of functional units for completion or partial completion reports and verification of work progress; (xvii) Procedures for award of vacant lots or ejidos; (xviii) Processing of requests for committees of prior land approval; (xix) Procedures related to compensation with contingency funds and other ANI accounts; (xx) Procedures related to the issuance of administrative acts ordering the initiation of judicial and administrative expropriation procedures, imposition of easements, automatic sanitation, and declarations of public utility, which includes the resolution of appeals filed within the framework of these procedures; and (xxi) Prior consultation procedures at all stages, in accordance with the provisions of the Ministry of the Interior.

However, during the suspension of terms, requests or consultations may be attended to, as well as the performance of functions by functionaries and contractors of the public entity from their homes.

Likewise, ANI may, using an exceptional discretion, regarding administrative and contractual actions, give continuity to all those actions that can be supplied by virtual means.

Please note that the suspension of terms will not apply with regard to the handling of requests from authorities, responses to requests in the exercise of the right of petition, or procedures involving the guarantee of fundamental rights. However, by virtue of circumstances of force majeure relating to the COVID-19 virus, public bodies may request a longer period than that legally established for dealing with this type of procedures.

Resolution 471 ordered the suspension of the following contractual obligations under concession agreements for road, port, rail and airport transport services, public construction agreements for railways, and audit agreements from March 24, 2020 at 11:59 p.m. until April 13, 2020 at 00:00:

(i) Land management; (ii) Environmental management and environmental activities other than those established by the environmental authorities; (iii) Social management; (iv) Networks transfer; (v) Works plans; (vi) Investment plan for port concessions; (vii) Equity contributions and, (viii) Subaccount funding, unless funding required to ensure the resources necessary for the payment of audit and surveying and to attend any other non-suspended obligations.

Please note that the above suspension does not include the obligations of operation of roads, ports, airports and railways, nor the obligations of essential maintenance for the provision of transport services. For the performance of these activities the concessionaire must establish a working protocol in safe conditions, based on the parameters established by the national government.

Similarly, the suspension does not include the attention of unstable sites and any other activity that guarantees the provision of the public transport service in safe conditions.

Notwithstanding the foregoing suspension, the parties to each concession, audit or public construction agreement shall have the possibility of convening to the advancement of all those procedures and actions that may be carried out by virtual means, such as, and not limited to, (i) approvals of guarantees; (ii) approvals of minutes; (iii) holding of contracting committees; (iv) execution of amendments; (v) execution of minutes related to force majeure events; (vi) authorizations for the disbursement of resources from the trust; and (vii) presentation of reports.

In the following sense, the parties to each concession, audit or public construction agreement may verify and agree on the recovery of certain procedures or the suspension of aspects not set forth in Resolution 471, at the request of any of them.

In public procurement processes, Resolution 471 adopted the following rules:

If during the period of Mandatory Preventive Isolation any public hearing is scheduled as part of a selection process, it may be rescheduled or suspended.

If during the period foreseen for the Mandatory Preventive Isolation, the evaluation of proposals is programmed, this will be done digitally using the SECOP II transactional platform.

The authorizing officers for expenditure, together with the Vice-President for Legal Affairs, must assess both the need to process contracts of any kind and the alternative technological means of processing such contracts during the period laid down for the Mandatory Preventive Isolation.

Alternative technological means for processing collection accounts and payments to contractors should be evaluated. Specifically, efforts will be made to join forces with the trustees for such procedures when the fees are supported by the trust of the concession agreements.

During the period foreseen for the Mandatory Preventive Isolation, the use of quality management procedures involving the presence of functionaries or individuals or their displacement must be managed virtually and, if necessary, with approvals by e-mail.

We are looking forward to any assistance you may require in connection with the above. For this purpose, you may contact Jaime Moya (jmoya@godoyhoyos.com) or Steffany Serebrenik (sserebrenik@godoyhoyos.com).

The above information is offered as an information service to our clients and does not constitute legal advice.