Global Journal of Management and Business Research, B: Economics and Commerce, Volume 21 Issue 5

Table 1: Eleven principles of the Brazilian port tariff In Brazil, “tariff” is a type of price (and its ways of charging) regulated by an Agency or Federal Department. Also called “public price”, as it is related to some state attribution. Usually used to deal with monopolies in the provision of essential infrastructure (transport, energy, telephony and sanitation). The regulated company's profit will not be so great that the consumer feels harmed, but it will not be so small that the entrepreneur feels uncomfortable (or discouraged) in investing high resources. It must be set at an adequate level to facilitate mortgages (therefore, it must be higher than market interest rates, or on the contrary, the loan must be subsidized by state banks) aimed at improving services or expanding infrastructure. The port tariff, a concept created by Decree No. 24.508, of 1934, and by Law No. 3.421, of 1958, is the price offered by Brazilian port authorities for supplies within the respective public port under their commercial management. It consists of a price list, called, in industry jargon, "tariff table", through a metric (or form of tax incidence), called "tariff modality". The tariff table must be “public”, with ample and prior knowledge of users (within a consolidated document). The value of the transaction is voluntarily assumed or provided by those who intend to use an available service, and it is not, therefore, a mandatory obligation arising from the legislation. It is carried out upon request, usually verbal, that is, on demand, without any kind of individual contract between the parties. In terms of market structure, the port authority, manager of the public port (sometimes called “organized port”) can be seen as a monopolist firm that discriminates N-Products, in addition to the following microeconomic characteristics: intensive in labor, sunk costs, economies of scale, barriers to entry, high fixed costs, low incentive to innovation, government participation in investments, extraordinary guarantees and a large presence of public goods. An alternative framework is also possible, such as a non-cooperative oligopoly, given that there are several ports in Brazil. However, we see some level of hegemony in certain types of cargo at certain ports, so that it is possible to model it as a monopoly, with a good dose of assertiveness, even if they face competition. This market power has been decreasing since the 2010s, mainly due to the advent of new private terminals (there are more than 200 nowadays), but it is still predominant because relationships are often very complex inside the transportation area and “essential facilities”. The simple entry of new providers is often not enough to reduce the market power of pre-existing agents. There are intangible aspects related to any business, such as loyalty, long-term relationships, trust between people and perception of quality. Another point is the idle capacity, where the local land transport infrastructure and the retroport areas also influence the choice of the embarkation or disembarkation port, as well as the offer of maritime routes by ship-owners. In price regulation, there are several methods, but for the purposes of our work, we are going to work with two: Regulation by rate of return (cost pricing) and Regulation by ceiling price (price cap). That's what we'll see now. b) Generic tariff review In the Brazilian public ports, we define the Tariff Review as a procedure to evaluate and examine all costs and revenues of a regulated company, renegotiating a new level of profitability for future investments, without any prior indexes, in order to ensure balance of the original economic-financial framework (re-equilibrium). It can be regular (in cycles) or not (it is suggested that the first cycle is three years, and may be extended to four years in the second and five years in the third), depending on the contract A Practical Tariff Methodology for Port Authorities principles to the remuneration of public services. Deriving from the study, Table 1 is proposed, with some additions and adaptations of this part. The additions descend directly from RN 32/2019. © 2021 Global Journals 12 Global Journal of Management and Business Research Volume XXI Issue V Version I Year 2021 ( ) B Principle Features 1. Proportional To the user's enjoyment. 2. Specific and divisible There is certain imputability to a particular user, separately identifiable, according to measurement. 3. Real There is a correspondence between what is charged and what is consumed (taxable event), effectively made available. 4. Exact It is known in advance by the user, before delivery starts. 5. Affordable Reflects the lowest possible cost. 6. Forthcoming It has only prospective effects. 7. Enough To meet the needs of the agents involved. 8. General Wide universality ensuring the greatest number of users 9. Neutral It does not distort market relations. 10. Reasonable It adequately remunerates the supplier, promoting the expansion of the service. 11. Fair For every type of user.