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(RISK-3208) Risk Allocation to Assess Public Contract: Particular Case - Brazil

Level: Intermediate
Venue: 2019 AACE International Conference & Expo, June 16-19, 2019, New Orleans, LA, USA

Abstract: Several contracts have a scope clearly defined, accountabilities established and allow stakeholders to reach their objectives. However, there are always uncertainties involved. Therefore, to avoid disputes and to ensure that desired results are achieved it is necessary to allocate contract risks to the most capable team to handle them. This means that there could be more ‘things’ to be considered in the budget.

In Brazil, a new Law (13,303) regulates the acquisition process by government companies. For engineering services, the owner must define the contract’s risks allocation. The overall objective of this law is to increase transparency and to minimize future disputes and additives.

In this context, the paper proposes a method to estimate the value of the transferred risks. Finally, through a case study, the proposed methodology is exemplified.