Viapar Toll Road

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Viapar - Rodovias Integradas do Parana S.A. (Viapar) was awarded a concession contract by the government of the State of Parana in 1997. The bidding process was competitive and the award criteria was the quantity of km of highways to be rehabilitated by the sponsors. Viapar is responsible for rehabilitating, expanding and operating a 474.1 km toll road. In 1997, Viapar was controlled by four private sponsors: Carioca Chirstiani-Nielsen, Construtora Cowan, Construtora Queiroz Galvao, and EIT Empresa Tecnica Industrial. Each private sponsor was holding 25% of Viapar's shares. According to Viapar, US$ 66 million was invested in the first year of the concession. In June 1998, the initial rehabilitation works were completed and the concessionaire started charging tolls. As of August 1998, the concession contract was under renegotiation; as the state government decided to reduce the toll rates, the concessionaire stopped its investment plans and only the rehabilitation works were implemented. In 2000, the original toll rates were restablished and Viapar resumed its investment plans. In 2003, after the concessionaries that operate in State of Parana failed to reach an agreement with the government to lower the toll rates, the government of the State of Parana enacted a statute to cancel the concession and return the management and operation of the highways to the State. In December 2003, a Federal Court declared that the cancellation should be preceded by an administrative process in order to define the due compensation to the company. In January 2004, the governor of the State of Parana enacted an executive decree expropriating the voting shares of Viapar. The government stated that the expropriation would not take place if the company agreed to reduce the toll rates. As of January 2004, the issues was pending final judicial decision. In April 2004 the federal court ruled that the concessionaire should still operate, thereby overturning the state court decree that took back the concession contract. The concessionaire and the state government were to negotiate toll rates but the contract was not in question. In 2003, Viapar was controlled by five shareholders: Carioca Christina-Nielsen, Queiroz Galvao, Construtora Cowan, EIT, and Camargo Campos. Anual Investments: 1998 - US$ 56.2 million (R$ 65.3 million) 1999 - US$ 1.87 million (R$ 3.39 million) 2000 - US$ 5.6 million (R$ 10.2 million) 2001 - US$ 12.9 million (R$ 30.4 million) 2002 - US$ 13.2 million (R$ 38.7 million) 2003 - US$ 6.4 million (R$ 19.4 million)