Public-Private Partnerships Laws / Concession Laws
As discussed in Legislative Assessment, there are a number of areas where existing laws of a host country may need to be modified to allow for successful infrastructure PPP projects, such as enabling the grant of step-in rights to lenders and requiring open and fair procurement processes. These modifications may be embodied in sector-specific law, or in the case of procurement, a procurement or competition law, or the can be included in a general concession or PPP law. This site includes links to guidance on drafting PPP/ Concession laws and sample enacted PPP laws.
While guidance and examples can be useful, each PPP/ concession law needs careful drafting to be consistent with the host country's existing laws. Legal draftsmen need to strike a balance between setting ground rules that encourage transparency and imposing general restrictions that may hinder bidding teams from achieving value for money or sensible solutions when bidding out PPP projects.
Further Reading and Resources
UNCITRAL has produced a Legislative Guide on Privately Funded Infrastructure Projects in 2000 where it discusses the different issues and how to deal with them.
It sets out suggested legislative language in its Model Legislative Provisions on Privately Financed Infrastructure Projects in 2003.
The European Bank for Reconstruction and Development (EBRD) defined a set of core principles for a modern concession law as legislative guidelines. The full text is also available in Russian and French from the EBRD here.
A paper "EBRD Core Principles for a Modern Concessions Law - selection and justification of principles" contains an explanation of each of the principles
OECD Basic Elements of a Law on Concession Agreements
A set of basic elements for Concession Agreements for corporate law and foreign direct investment legislation joint produced by the Istanbul Stock Exchange (ISE), the OECD and a group of experts from NIS, Black Sea and South-East European Countries.
Examples of PPP Laws
Set out below are links to examples of PPP/ Concession Laws enacted in various countries. We also attach for information links of commentaries by third parties of such laws, where these were available. The World Bank did not prepare these commentaries and does not endorse them or their authors.
- Argentina Ley de Asociaciones Publico-Privadas - Concession Law: Regimen para la Promoción de la participación Privada en el Desarrollo de Infraestructura (Spanish)
- Brazil PPP law commentary: Article by Jacques Cook in which he discusses the recently enacted PPP Law in Brazil and explains how it offers the opportunity to stimulate lagging private investment in social and infrastructure projects in that country.
Law on Concessions of Bulgaria (English translation) October 5, 1995, as amended
Cameroon Loi N° 2008/009 du 16 juillet 2008 fixant le régime fiscal, financier et comptable applicable aux contrats de partenariat (in French)
Quebec, Canada (in French) - establishment of a PPP unit and powers of PPP unit
Assessment of Concession Laws (2008) - prepared by the European Bank for Reconstruction and Development - Including: Albania, Armenia, Azerbaijan, Belarus, Bosnia and Herzegovina, Bulgaria, Croatia, Czech Republic, Estonia, FYR Macedonia, Georgia, Hungary, Kazakhstan, Kyrgyz Republic, Latvia, Lithunia, Moldova, Montenegro, Poland, Romania, Russia, Serbia, Slovak Republic, Slovenia, Tajikistan, Turkey, Turkmenistan, Ukraine, Uzbekistan.
- Ley 1508 de las Asociaciones Público Privadas (PPP Law 1508) of 10 June 2012
- Decreto Ley 1467 de las Asociaciones Público-Privadas (Decree 1467) of 6 July 2012 as modified by Decreto Ley 0100 (Decree 0100) of 25 January 2013
Czech Republic Concession Law (pdf) (in English, official version)
European Union Rules on Public-Private Partnerships - including EU rules on setting up public-private entities, EU law on public procurement and concessions in relation to public-private partnerships and 2004 Green Paper on how procurement law applies to different forms of public-private partnerships
Directive 2014/23/EU of the European Parliament and of the Council of 26 February 2014 on the award of concession contracts (English but also available in other EU languages including French and Spanish). The new EU directive sets out minimum EU requirement for the award of concession contracts by public authorities to procure works or services from private suppliers. More information on the EU directive is available on the website of the European Commission.
- PPP in France 2006, an article produced by Linklaters
- Ghana Public-Private Partnership Advisory Unit
- National Policy on Public-Private Partnerships of Ghana
- Ley de Alianzas para el Desarrollo de Infraestructura Económica - Decreto 16-2010 (Decree 16-2010 on Public Private Partnerships) of 13 April 2010 (Spanish)
- Ley de Promoción de Alianza Público-Privada (Law for the Promotion of Public-Private Partnerships) of September 2010 (English and Spanish).
- Reglamento General de la Ley de Promoción de Alianza Público-Privada (General Regulation to the Law for the Promotion of Public-Private Partnerships) of January 2011 (English and Spanish).
- India National Public-Private Partnership Policy (PDF)
- Haryana, India: Public-Private Partnership (PPP) Policy
- Jordan Public Private Partnership Regulations 2008 - these are relatively straightforward and very clearly drafted regulations setting out the institutional arrangements as well as the process for development and procurement of PPP projects.
- Jordan Privatization Law 2000 - law pursuant to which the PPP Regulations are made. The concept of privatization is broad and includes public private partnership type arrangements.
- PPP Legislation (English and Arabic)
PPP Law 2009 (English translation) - The PPP Law defines possible types of PPP in Latvia and linked procedures, prescribes procedures for PPP project implementation and monitoring and envisages the establishment of a PPP monitoring and competence centre.
- Ley de Asociaciones Público Privadas (Law on Public-Private Partnerships) of 16 January 2012 as revised 14 July 2014 (Spanish)
- Reglamento de la Ley de Asociaciones Público Privadas (Regulations for the Law on Public-Private Partnerships) of 5 November 2012 (Spanish)
Morocco Loi n° 54-05 relative a la gestion deleguee, 2006 (French)
- Ley de Concesiones Eléctricas y Reglamento (Spanish)
- Ley de Supervisión de la Inversión Privada en Infraestructura del Transporte de Uso Público y Promoción de los Servicios de Transporte, 1998 (Spanish)
- PPP Law 2008 (Polish)
- 2012 PPP Law: Decree Law 111/2012 (Decreto-Lei n.º 111/2012) of 23 May 2012 (Portuguese)
- 2008 Public Contracts Code: Decree Law 18/2008 (Decreto-Lei n.º 18/2008) of 27 April 2008 and amendments (Portuguese)
Romania’s New Public Procurement Law, Herzfeld & Rubin P.C., 2006.
- Loi relative aux contrats de construction exploitation transfert d'infrastructure (BOT Law) of of 1 March 2004 (French)
- Projet de Loi Instituant le Conseil des infrastructures (Law Establishing the Infrastructure Council) of 13 February 2004 (French)
Ley reguladora del contrato de concesión de obras públicas (Concession Law) (Spanish)
- Decreto-Lei No. 42/2012 Regime Jurídico das Parcerias Público Privada (PPP Act 42/2012) of 7 Septembre 2012 (Portuguese).
Tunisia's Draft Concession Law (Project de Loi relatif au régime des concessions) (text in French)
- United Kingdom Treasury - Public Private Partnership policy and guidance
- United Kingdom Treasury - Standardisation of PF2 Contracts (SoPC) (December 2012)
- United Kingdom Treasury - Procurement and contract management
- United Kingdom - Value for money assessment for using private finance
- United Kingdom - Archived guidance of PPPs in Infrastructure
- United Kingdom Treasury - Budgeting and accounting for PPP arrangements
- United Kingdom Treasury - Finance guidance
- Contratos de Participacion Publico-Privada para la Realización de Obras de Infraestructura y Prestación de Servicios Conexos - Ley No. 18.786 (Law 18.786 on Public-Private Partnerships) of 19 August 2011 (Spanish).
Public Private Partnerships in Transportation - a toolkit for legislators developed by the National Conference of State Legislators - includes links to ppp enabling legislation in different states of the US
How to manage Unsolicited Proposals
Governments may be presented with unsolicited proposals for infrastructure projects by private sector entities. It's difficult to know exactly how to respond to unsolicited bids in order to protect transparency during the procurement process and at the same time recognize the initiative of the proponent.
The World Bank does not permit the use of unsolicited proposals in Bank funded projects and considers that unsolicited proposals should be dealt with with extreme caution. The ways in which different countries manage unsolicited proposals can be found in PPIAF Working Paper No.1, Unsolicited Infrastructure Proposals.
A number of approaches and guidelines on managing unsolicited proposals have been developed by countries around the world. Examples are below.
UNCITRAL considers these issues at paragraphs 96 to 117 of the Legislative Guide on Privately Funded Infrastructure Projects. It sets out suggested legislative language in provisions 20 to 23 of its Model Legislative Provisions on Privately Financed Infrastructure Projects in 2003. Whenever a host authority receives an unsolicited bid, UNCITRAL recommends that the authoprity first consider whether the proposal is potentially in the public interest. If so, the authority then requests further information from the proponent in order to make a full evaluation. If the authority decides to go ahead with the project, it determines whether the project necessarily involves intellectual property, trade secrets or other exclusive rights of the proponent. For projects that do not involve these rights, a full selection procedure is followed, with the proponent being invited to take part in the selection. If it does necessarily involve the proponent's intellectual property, a full selection procedure does not need to be followed.
Chilean law approach
Chile has adopted an approach whereby the project proponent is required to take part in a fully competitive tender process, but is given bonus points in relation to the evaluation. The process to manage unsoliticed proposals is found in detail (in Spanish) in a regulation (secondary legislation) to the law (reglamento) Reglamento 956 Chilean Concession Regulations 956. Click on Chile Summary for a summary of the regulations.
The South African National Roads Agency Policy - this grants the original proponent an advantage by giving it the opportunity to take part in the call for "best and final bids". See for example, South African National Roads Agency policy.
The New South Wales (NSW) Government
The Guide for Submission and Assessment of Unsolicited Proposals outlines a transparent and streamlined approach that will facilitate the NSW Government and private sector working together to develop and deliver innovative ideas. The Department of Premier and Cabinet has received a number of submissions that do not meet the criteria set out in the Guide that would justify a direct commercial relationship with a proponent (instead of a competitive tender). Supplementary information has been developed to help those considering making a submission to confirm compatibility with the requirements of the process.
Its key objective is to provide consistency and certainty to private sector participants as to how their unsolicited proposals will be assessed within a transparent framework with key drivers for the NSW Government being how the proposal helps meet a strategic Government objective and value for money.
Further Reading and Resources
- Unsolicited Proposals – An Exception to Public Initiation of Infrastructure PPPs: An Analysis of Global Trends and Lessons Learned, Public-Private Infrastructure Advisory Facility (PPIAF), August 2014.
- Overview of the PPP Legal and Institutional Frameworks in the Western Balkans, European PPP Expertise Centre (EPEC), July 2014.
- Regulatory Frameworks for Successful PPPs in MENA Countries in Making Reforms Succeed, Organistation for Economic Co-Operation and Development (OECD), July 2008.
- PSP in urban public services: comparison of laws and institutions in MENA countries
- International Comparative legal Guide Series - PFI/ PPP Projects 2007 (summaries of arrangements for PPP/ PPP laws in a number of jurisdictions).
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