Published on March 6, 2014
PPP: current status & perspectives 18 february 2014 Public Governance Committee OECD Maria Yarmalchuk, Department of investment policy and development of PPP
The Federal Law of 21 July 2005 № 115-FZ "On Concession Agreements" Legislation on concessions The ability to implement projects using BTO model. Legislation contains a limited list of objects of the agreements: - objects of transport infrastructure (road, port, railway and other) - social infrastructure (health, education, culture) - production facilities, transmission and distribution of electric and thermal energy - utilities Approved 12 model concession agreements stipulated by the Law. Concessions are concluded at the federal, regional and local levels, depending on the level of decision-making and risks in project implementation 2
Concession agreements Quantity of concession agreements concluded in 2009-2013 1500 2013 breakdown by sector Utilities, housing Municipal infrastructure 16% 1000 Energy infrastructure 22% Healthcare, education, culture, sport Social infrastructure infrastructure 35% Transport infrastructure 27% 500 0 2009 2010 2011 2012 2013 3
Improvement of the concession law Conclusion of concession agreements with the subsequent fee of the grantor with respect to any kind of objects Expansion of the list of objects of the concession Private initiation of concession agreement The guarantee of rights and lawful interests of private partners and creditors Are able to participate in concession agreement several public entities other 4
Regional laws on PPP The absence of regulation of contractual PPP instruments at the Federal level Russian regions began to develop and adopt regional laws on PPP Regional laws on PPP enacted in 67 regions of the Russian Federation Half of them are declarative Half of them are functioning Even functioning laws collide with: Land Code Legislation on Competition Legislation on traditional procurement 53 agreements have been concluded on the basis of regional PPP laws 5
Factors limiting the development of PPPs in Russia Limited number of PPP models utilized Risk of recognition of regional PPP law invalid Budget code constraints Limited possibility to attract loan financing (lack of possibility of the object ownership and pledge) Unable to allocate publicly owned property, including land plots, for purposes of PPP project within single tender procedure Lack of unified terminology The lack of a unified process of selection, preparation, approval of projects, and also the organization of tender procedures 6
The bill of PPP low The highlights: Opportunity for public partner utilize different forms of PPP Introducing the notion “authorized government body” responsible for PPP Conclusion of PPP contract beyond single tender procedure Opportunity for conclusion of PPP contract on several infrastructure objects simultaneously Opportunity for public partner, private partner, and financing company to make direct agreement for step-in right mechanism The pledge of the object of agreement is not limited The list of infrastructure objects constructed (rehabilitated) according to PPP project is not limited 7
Forthcoming PPP legislation development Adoption of: preparation order of PPP agreements methods and criteria for assessment of PPP project effectiveness procedure of monitoring and statistical accounting of PPP projects PPP project’s KPI procedure of public debates on decisions of the authorities on the conclusion of PPP agreements private partner selection guidelines professional development programs (educational programs) 8
PPP Projects in Transport System Planned projects and projects which are being implemented Project Investmets, billion USD High-speed Railroad Moscow - St.Petersburg 18,8 International transport corridor "Europe - West China" 18,4 Railroad "Prohorovka - Batayisk" 16,8 Federal road "M-4 Don" 7,7 Federal road "M-4 The Urals" 6,5 By-pass Railroad in Omsk 4,7 Railroad "Polunochnoye - Salekhard" 4,1 Railroad "Komi - Arkhangelsk (Belkomur)" 4,1 "Vostochniy" Spaceport (First Stage) 4,0 Murmansk transport nodal point 3,5 9
Thank you for your attention!
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