Law 14.133/21: Bidding Procedures, Principles, and How Companies Take Part in Public Tenders

This page is a translation of the original Portuguese text, provided for convenience. It deals with Brazilian law. If there is any discrepancy, the Portuguese version prevails. Read the original in Portuguese

Law 14.133/21 now governs public procurement in Brazil. It sets out principles such as legality, equality, and objective evaluation, narrows the bidding procedures to five, and organizes company participation around clear prohibitions and four areas of qualification.

Since the previous public procurement law was repealed, Law 14.133 of April 1, 2021, has been the general statute governing how the Brazilian government buys goods, contracts for services, and carries out public works. For a company that wants to sell to the government, knowing this law is no longer a competitive edge. It is a condition of survival in the public contracting market.

Three areas tend to raise the most questions for anyone studying the subject: the principles that guide every bidding process, the procedures through which the competition takes place, and the rules on company participation. This article walks through each of them based on the text of the law, in plain language.

Principles That Guide Bidding Under Law 14.133/21

Article 5 of Law 14.133/21 opens the legal framework by listing the principles that must be observed when applying the law. They include legality, impersonality, morality, publicity, efficiency, public interest, administrative probity, equality, planning, and transparency, along with effectiveness, segregation of duties, reasoned decision-making, and adherence to the bidding notice.

The list continues with objective evaluation, legal certainty, reasonableness, competitiveness, proportionality, speed, cost-effectiveness, and sustainable national development. This set of principles is not decorative. Each one works as a standard of review, allowing you to challenge decisions that depart from equal treatment among competitors or from the objectivity promised in the bidding notice.

The principles of public bidding are closely tied to the Constitution. Public administration must follow the principles of legality, impersonality, morality, publicity, and efficiency, and the constitutional text requires that works, services, purchases, and disposals of property be contracted through a bidding process that ensures equal conditions for all competitors. If you want to understand the general design of the procedure, it is worth learning how public contracting through bidding works.

The Five Bidding Procedures

Article 28 establishes that the bidding procedures are the pregão (a reverse auction for common goods and services), the concorrência (open competitive bidding), the concurso (a design or creative-work contest), the leilão (a public auction), and the competitive dialogue. The law also prohibits creating other procedures or combining those it provides for. This closes the list at five and does away with the old carta convite (invitation to bid) and tomada de preços (mid-range bidding) of the earlier statute, which has since been repealed.

Each procedure has its own purpose. The concorrência is used to contract special goods and services as well as engineering works and services. The pregão is mandatory for purchasing common goods and services. The concurso is meant for selecting technical, scientific, or artistic work. The leilão is used to sell real property, or movable property that is unusable or lawfully seized, to whoever makes the highest bid.

Competitive dialogue is the most notable new feature. It is a procedure for contracting works, services, and purchases in which the government talks with bidders preselected under objective criteria in order to develop alternatives that can meet its needs, before it receives the final proposal. The concorrência and the pregão, by contrast, follow the standard procedure, and the pregão is used whenever the performance and quality standards for the subject matter can be objectively defined in the bidding notice. If you need to decide which route fits, you can study the bidding procedures and how a company chooses the right competition.

Criteria for Evaluating Bids

Once the procedure is chosen, the next question is how the bids will be compared. Article 33 sets out six evaluation criteria: lowest price, highest discount, best technique or artistic content, technique and price, highest bid in the case of an auction, and highest economic return. The bidding notice defines the criterion, and it must be consistent with the subject matter and with the procedure adopted.

Article 34 clarifies that evaluation by lowest price or highest discount looks to the lowest expenditure for the government, provided the minimum quality standards set in the bidding notice are met. The law also allows indirect costs tied to maintenance, use, replacement, depreciation, and environmental impact of the subject matter to be counted when determining the lowest expenditure, whenever they can be objectively measured. This dispels the simplistic idea that the lowest nominal price always wins.

This objectivity is a requirement of the system itself. Because adherence to the bidding notice and objective evaluation are among the principles in Article 5, the announced criterion governs the competition from start to finish, and the government cannot reward factors that were not provided for along the way. For a company, reading the evaluation criterion is the first step in working out whether its bid has a real chance of winning.

Company Participation: Prohibitions and Qualification

Not every company can compete. Article 14 lists who may not take part in the bidding or in carrying out the contract, directly or indirectly. This includes, for example, the author of the basic or executive project, the company responsible for that project, anyone under a sanction that bars participation, and anyone with a close relationship to a manager or public official involved in the bidding. The purpose of these prohibitions is to protect equality and morality by keeping insider information or personal relationships from distorting the competition.

Once a company clears the prohibitions, it must show that it is able to perform the contract. That is the role of qualification (habilitação), defined in Article 62 as the phase in which the information and documents necessary and sufficient to demonstrate the bidder’s ability to perform the contract are verified. It is divided into four areas: legal, technical, tax, social security and labor compliance, and economic-financial.

Taking part in a public bidding means getting through two doors: first, not falling under the prohibitions of Article 14, and then proving the four qualifications of Article 62, subject to the order of the phases, the diligence measures allowed, and the legal grounds for disqualification.

In practice, many competitions are decided less by price and more by paperwork. An expired certificate or an insufficient technical certificate can lead to disqualification, subject to the order of the phases, the possibility of diligence measures, and the rules of the bidding notice. That is why preparing documents in advance is often just as valuable as commercial strategy. To go deeper on this point, it is worth reading about qualification in public bidding and the documents that often sink a bid.

Comparison Chart of the Bidding Procedures

The chart below brings together the five procedures in Article 28 and their main purpose, helping you see when the government tends to use each one.

Choosing the right procedure, evaluation criterion, and qualification documents depends on the subject matter, the value, and the risk of each contract. Reading together the principles in Article 5, the procedures in Article 28, the criteria in Article 33, and the participation rules in Articles 14 and 62 gives a company a reliable map for competing for public contracts with predictability and for reducing the risk of being excluded over a formal defect. Mastering these rules also lets you challenge the bidding notice in time and plan your documentation well in advance.

Frequently Asked Questions

What are the bidding procedures under Law 14.133/21?

There are five, set out in Article 28: pregão, concorrência, concurso, leilão, and competitive dialogue. The law itself prohibits creating other procedures or combining the existing ones, so the list is closed. The pregão is mandatory for common goods and services, while the concorrência covers special contracts and engineering works. Competitive dialogue, new under the law, allows prior discussion with selected bidders before the final proposal.

What principles govern bidding under Law 14.133/21?

Article 5 lists an extensive set of principles, including legality, impersonality, morality, publicity, efficiency, public interest, administrative probity, equality, planning, transparency, adherence to the bidding notice, objective evaluation, legal certainty, competitiveness, and cost-effectiveness. These principles add to the requirements of the Constitution, which calls for a bidding process capable of ensuring equal conditions for all competitors.

What does a company need in order to take part in a public bidding?

First, it must not fall under the prohibitions of Article 14, which excludes, for example, the author of the project, anyone under a sanction that bars participation, and anyone with a close relationship to a public official involved in the bidding. Then it must prove the qualification required by Article 62, which is divided into legal, technical, tax, social security and labor compliance, and economic-financial. Flaws in the documentation must be assessed under the bidding notice, the order of the phases, and the diligence measures allowed by law, and they may lead to disqualification.

As informações deste artigo são de caráter informativo e não substituem consulta jurídica individualizada. Cada caso possui particularidades que exigem análise específica.