Bangladesh gets is first Public-Private Partnership (PPP) law. On September 16, 2015 government publish the act through gazette. Previously “Policy and Strategy for Public Private Partnership (PPP), 2010” was the only relevant policy. That Policy is now repealed by the new act. In 2013, PPP Office published a draft laws for public consultation.
The law will provide public-private partnership a firm legal basis and hopefully will promote economic development.
Key provisions of the Public Private Partnership (PPP) Act, 2015
Establishment of PPP Authority:
The government will set up the Public Private Partnership (PPP) Authority. It will be governed by a Board of Governors. The Prime Minister will be the Chairman and the Finance Minister will be the vice Chairman of the Board of Governors. At least six meetings of the Board will be held in a year.
The head office of the PPP Authority will be in Dhaka. The Authority will be able to set up branch offices anywhere in the country and abroad. Policies and guidelines of the body will be formulated by its authority.
The PPP authority can take any project apart from the Annual Development Programmes and implement that project through PPP.
The PPP Authority will have a Chief Executive Officer (CEO).
The present PPP Office under the Prime Minister office will vested with the PPP Authority.
Key responsibility of the PPP Authority:
- developing PPP related policy, regulations and guidelines;
- developing standard documentation for PPP Project;
- developing standard for TOR and salary of consultants and experts;
- providing consents and opinions in relation to PPP projects;
- organizing seminars and training sessions, etc.
Identification and approval of PPP projects.
The relevant government agency or the PPP Authority will take initiative for PPP Projects. The Cabinet Committee on Economic Affairs (“CCEA”) is mandated to provide the in-principal and final approval for PPP projects.
Subsidy by government
Under the act, the government will be able to provide the following subsidy in any PPP Project:
- Technical Assistance Financing.
- Viability Gap Financing.
- Financing against Equity and Loan.
- Financing against Linked Component.
Selection of private partner to develop and execute PPP projects,
The act does not provide detail guideline on selecting private partner for PPP Project. There will be subsequent regulations in this regard.
Any private party may submit Unsolicited Proposal to the Contacting Authority or the PPP Authority. There will separate subsequent guidelines in this regard.
All PPP Projects with be contracted with a separate Project Company other than the sponsors. The project company will be limited by shares and incorporated in Bangladesh. All liability should be borne by this Project Company.
Corruption and conflict of interest
The act set out provisions for corruption and conflict of interest which are similar to Public Procurement Act 2006 and Public Procurement Rules 2008.
The act does not provide much restriction or detail guideline about the project agreements including the governing law of the agreements. For dispute resolution, the act requires arbitration before going to the court.