The Watchdog "is permissive with the dealer jeopardizing not only the performance of the contract but also risking the safety of vehicles" in the international bridge Santo Tome - Sao Borja.

The controlling entity is not a court of auditors; it is a Delegation of Control (DELCON) that was created in 2003 with members from Brazil and Argentina to oversee the operation and maintenance of the bridge. The General Audit Office (AGN, for its acronym in Spanish) evaluated the work of this organization between 2009 and 2012.

The international bridge Santo Tome - Sao Borja links the Province of Corrientes, on the Argentine side with Rio Grande do Sul in Brazil and is the third largest. It was opened in 1997 with the aim of decentralizing traffic crossing in the Uruguay River, because "80% crossed by Paso de los Libres."

It was in 1989 "an agreement between two nations which initiated the studies and analyzes for its creation." In parallel, the Joint Argentine Brazilian (COMAB) was created to take charge of monitoring those jobs. Finally on December 12, 1995 COMAB homologated the award of the concession of public works to MERCOVIA DELCON Consortium for control.

One of the most significant cases that show the permissibility of the delegation is related to the maintenance of the verges. Despite being within the agreement signed, there were disputes with intimations roundtrip between the concessionaire and DELCON.

In October 2009, the controlling entity issued a report stating that "the shoulders had disagreements." The company presented projects with requests for extensions, "despite being challenged by DELCON because they did not consider traffic conditions were approved without observations being corrected."

Work began and the Delegation continued to monitor dangerous situations arising from "crushed stone detachment, especially in corners." Only in January 2011, nearly two years after the Watchdog audited the company and for this reason it called for a new plan of work. MERCOVIA took half a year to start this work.

Once concluded, the DELCON evaluated and found that the works had drawbacks causing "insecurity in traffic."

Given this situation the AGN spoke and said that "the management of the parent delegation is permissive for the contract."

The field team of Audit made an inspection in 2013, both the Argentine and the Brazilian side, noting that "the shoulders are a risk to the vehicle as there are mismatches that could cause the vehicle to overturn."

Maintaining slabs of road Patios Customs was another tug of war.

El Patio was created in 1998, intended to control truckloads. Two years after its inauguration, "cracks in the pavement that generated several drawbacks as the entry of water to the surface were detected". Repair work began in 2001 and, again, "had cracked or broken tiles." They were repaired in 2006, but the following year it occurred once again.

After 14 years of operation and three and a half years of back and forth between the DELCON and MERCOVIA "the delegation got the licensee to submit a schedule of works", even though "it has the authority to enforce the contract." So "it is again demonstrated that the controller body has a permissive way of admitting delays in the maintenance of road infrastructure but not punishing as it should."

Arbitral Awards

In the concession contract it states that if the operator is unhappy about any decision COMAB can call arbitration within 15 days since being notified to assess the measure.

MERCOVIA used that resource twice. The first took place in December 2002 when the company claimed, first, that "unforeseen and additional works had higher costs." On the other hand, it claimed that "the operation of the Border Center is in unfavorable conditions, either because of unforeseen circumstances, for breach of COMAB or by the Member States, causing damage."

For this situation it was agreed that COMAB would pay $ 17.5 million dollars in three equal installments. In return, the dealer "committed to a series of works such as pavement structure supplements, shoulders, two buildings for offices, among others, from the first collection."

It was this same resolution which resulted in a second arbitration in June 2010.

MERCOVIA claimed payment of default interest for the delay of the agreed quotas "as recorded" Four years and one month delay in the cancellation of the agreement."

Consequently, the company claimed the payment of default interest, a request that was rejected by the COMAB. Instead, DELECON gave place partly as requested by MERCOVIA and ordered that Argentina pay almost $ 10 million (pesos) and Brazil almost $17 million (current).

In line with what has been explained above, although DELCON considered that the first payment was made in November 2005 and "the works did not start until later", as agreed, "It did not apply any sanctions." Just in September 2009 "it notified the dealership of a 3 million dollar fine.”

The company complained and after several twists and turns in February 2010 "A memorandum of agreement was signed to suspend the administrative deadlines in which it is stated that MERCOVIA would finish the work would by 2002."

Faced with this situation, and after extensive analysis, the AGN concluded that "despite having the tools to be intimate and punish the DELCON dealer, it allows it to incur in unnecessary delays."