Public-Private Partnership

What is a Public-Private Partnership (PPP) ?

The Law On Public-Private Partnerships approved by Parliament Resolution No. 7 on 24 February 2012 defines a Public-Private Partnership (PPP) as a long-term (up to fifty years) interaction between public and private partners for engaging the private partner by the public partner in designing, financing, construction, rehabilitation, reconstruction of assets, as well as the management of existing or newly created assets, including infrastructure assets. In other words, a PPP is: a contract between a public partner (contracting authority) and a private sector entity (usually of medium or long-term duration) awarded through competition where the private partner performs a public function (e.g. provides infrastructure, a service to the public, or both) and is allowed to develop the best way of providing the infrastructure or service (so-called ‘output specification’) but where it also carries the risk that if it does not perform well its payments will be affected (so-called ‘risk allocation’).

PPP PROCEDURES

PROCEDURES FOR PUBLIC PRIVATE PARTNERSHIPS

1. Preparation of a PPP project

2. Selection of a private partner

3. Implementation of PPP projects

2. Preparation of a PPP project involves search and initiation of a PPP project, formation of the tender commission, preparation of tender rules       and tender documentation

3. Selection of the private partner includes tendering, negotiation and conclusion of the PPP agreement with the successful tenderer

4. Implementation of a PPP project begins from the  signing  of the PPP agreement and ends with the expiration of its legal term

5. State partners have a right to engage independent consultants for the preparation and implementation  at any stage of a PPP project 

PROJECT DEVELOPMENT SUPPORT FACILITY

Project Development Support Facility  - is a special financing unit to effectively and efficiently facilitate PPP project development. 

Scheme of PPP projects preparation under support of Project Development Support Facility (PDSF)

(Approved by the Resolution of the Government No. 147 as of 17 March 2014)

Resolution approves:

  • Regulation of Project Development Support Fund
  • Regulation on Procedures for Preparation of PPP Projects under PDSF Support
  • Project Brief Form (project initiation document)
  • Criteria for approval of initiated projects for PDSF financing

 

PDSF objectives:

  • Financing consulting services under preparation of PPPs, including tender documents and feasibility studies
  • Support in projects tendering
  • Co-financing of PPPs preparation

 

Supervised by Steering Council:

  • Vice Prime Minister (on economy and investments) - Chairperson
  • Minister of Economy
  • Minister of Finance
  • Minister of Justice
  • Chairperson of State Property Fund

  

Authority of Steering Council includes:

  • Approval of financing of initiated PPPs
  • Approval of Terms of References for preparation of initiated PPPs
  • Monitoring of proper use of PDSF funds

 
Ministry of Economy provides methodological, organizational and other types of operational support.

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