The Federal Court of Accounts and his non-competence to determine retention of payments in administrative contracts

Abstract

The adoption, by the Federal Court of Accounts (TCU – Brazil), of a provisional measure of retention payments due to contracted in administrative contracts is not covered by the Brazilian constitutional order. Retaining payments, even if partially, is nothing more than to halt the financial execution of the contract. And the original competence to suspend administrative contracts is the Brazilian National Congress (FC, art. 71, § 1º). Obliging the contracted party to perform the same physical object for a pecuniary compensation inferior to the one proposed in the bidding process disrespects still the art. 37, XXI, of the Federal Constitution, which ensures the maintenance of the effective conditions of the proposal presented. Moreover, even the Brazilian National Congress would not have the constitutional power to partially suspend the financial execution of the administrative contract (as in the case of retentions). It is only up to him to stop the administrative contract in its entirety, in the physical and financial dimensions together.