Region: Europe and Central Asia
Public-Private Partnerships (“PPPs”) are no revolutionary concept in France but unlike elsewhere in Europe domestic law has not, until very recently, provided sufficient flexibility to encourage proper development.
Since the end of World War II, the cult of the State has been strongly upheld in France with the public sector in charge of virtually all infrastructure projects. Concessions were more often than not awarded to separate public entities rather than to privately held companies looking for public partners.
One episode, in particular, which has had a significant delaying impact on the growth of the PPP market relates to the now infamous METP (marchés d’entreprises de travaux publics). The METP, which were employed principally for school building projects during the 1980s-1990s were long term contracts covering both construction (or renovation) and on-going maintenance aspects against which the contractor was remunerated over time by the public authority.The METP technique was heavily criticised, not only in its implementation - procurement mechanics were seen as an opaque way of avoiding the protections of the public procurement code (code des marchés publics), but also in its philosophy since, although producing infrastructure at no initial capital cost to the public sector, it led indirectly to local authorities paying for expensive private sector financings. The METP were often linked to political funding scandals and were ultimately banned, leaving for many (such as small businesses who felt themselves excluded from this market), an enduring stigma. Along with their prohibition came a number of additional restrictions to the public procurement code referred to in greater detail below (please the section entitled "Legal framework for PPPs” below).
One important distinction to be drawn between today’s PPP and the METP is that unlike today’s PPPs the METP did not benefit form any defined legal framework.
Tracking Number: PPP In France Linklaters_2006_English
Updated: March 28, 2021