Ten years of Brazilian airport concessions, learned lessons

The examination of contractual aspects, including rigid terms and incentives, in the outcomes of concessions has been studied across various economic sectors worldwide. Despite positive results reported in the literature, particularly regarding the enhancement of operational efficiency in infrastructure, gaps remain in understanding the factors contributing to the success or failure of concessions within the airport industry. The Brazilian context reveals instances of both commendable and detrimental practices in enduring contracts, establishing a link between contractual variables and resulting outcomes. This study aims to illuminate contractual elements concerning the devolution of airports granted in Brazil, highlighting problematic instances and successful practices. An examination of contracts spanning ten years, considering various times and situations, suggests the presence of rigid clauses that hinder operators' adaptability to external changes, such as the pandemic, and others that foster inefficiency or the return of assets. The subsequent analysis correlates contractual and external factors to elucidate the duration of the contracts. In conclusion, this study identifies that auction duration is primarily driven by competition levels and regulatory rounds. We propose drafting adjustments, such as standardized learning clauses and competition filters, to mitigate the risk of aggressive bidding and prevent future undesired asset returns.