TozziniFreire advises CTG Brasil on NDB loan
TozziniFreire Advogados advised China Three Gorges Brasil Energia (CTG Brasil) as Brazilian legal counsel in connection with a RMB 950,000,000 (nine hundred and fifty million Chinese Renminbi) term loan facility extended by the New Development Bank (NDB) to CTG Brasil. The loan is guaranteed by China Three Gorges International Limited and is intended to finance the construction and operation of the Serra da Palmeira power project, a 648 MW wind farm located in the State of Paraíba, in the North-East region of Brazil.
The project comprises 108 wind turbine generators with a capacity of 6 MW each, implemented through 23 special purpose vehicles that operate as step-down subsidiaries of CTG Brasil. The transaction spanned three jurisdictions – Brazil, the People’s Republic of China and Hong Kong – reflecting the multi-layered structure of the financing, which combines a Brazilian borrower, a Hong Kong-based guarantor and a multilateral lender.
The loan is governed by English law, which required coordination between Brazilian and English law counsel to comply with apostille, sworn translation and registration requirements needed to ensure enforceability in Brazil. The financing structure, involving a guarantee from a Hong Kong entity, added a further layer of complexity by bringing Brazilian, Chinese and Hong Kong legal frameworks into play. The operation also involved the regulatory, environmental and contractual analysis typical of a project finance structure for an energy infrastructure project with foreign funding, along with the specific procedural requirements that the NDB, as a multilateral development bank, applies to financings of this kind.
The TozziniFreire team advising CTG Brasil was led by partner Daniel Laudisio, together with senior associate Bryan Nathan Klein and associate Gabriel Rogenfisch Quintans.
Norton Rose Fulbright acted as English law counsel to the NDB, with the team including Caspar Davey, Cameron Royse and Arthur dos Santos.
HNaves Advogados served as Brazilian law counsel to the NDB, represented by Helen Naves and Thais Rebello. Clifford Chance acted as English law counsel to CTG, with Vicky Ma and Yi Wang on the team.
