Risk Management in Transport PPP Projects
In the Islamic Countries
105
security, or in case of unsuccessful tenders. Direct negotiation with a specific operator is also
allowed in case only specific operators are able to provide the requested goods/works/services.
Also, any direct negotiation procedure is implemented in accordance with a framework defined
in a negotiation guiding document developed by the contracting authority and subject to prior
approval by CNP-PPP.
Selection of the preferred operator: unsolicited proposals . A specific procurement
procedure is defined in the PPP legislative framework in case of unsolicited proposals. In
principle, the procurement process for unsolicited proposals is also based on a competitive
tender. In such case, the preliminary studies prepared and submitted by the proponent shall
provide the basis for the competitive tender: in any case, the contracting authorities are required
by law to take the necessary steps to reconcile equal treatment of bidders with respect for
intellectual property rights and industrial secrecy of operator behind the unsolicited proposal.
As an exceptional measure, the awarding of the PPP contract based on an unsolicited proposal
may give rise to a direct negotiation procedure authorized in advance by the Minister
responsible for the state budget, and subject to advice of CNP-PPP. In case a private entity
expresses interest in submitting an unsolicited proposal, the first step of the procurement
process is the signature of a Memorandum of Understanding between the procuring authority
and the private entity to define the legal obligations of both parties (including intellectual
property rights and the timing for the preparation of the proposal). The CNP-PPP can assist the
contracting authority to define the MoU. Once the MoU is signed, the project promoter can
prepare its technical and economic proposal, inclusive of preliminary studies. Once received, the
proposal must be evaluated and approved not only by the contracting authority but also by the
CNP-PPP and the Ministry of Budget. Technical, legal and financial consultants may be appointed
by the contracting authority to review the submitted proposal. Only upon receiving these
approvals, the contracting authority can then enter the negotiation phase with the project
promoter to define the PPP agreement.
Contract negotiation and signature. Once the preferred contractor is selected by a
competitive tender or in case of direct negotiation, a commission is set up to finalize the PPP
agreement. In this phase, the commission is generally composed of members appointed by the
contracting authority, the Ministry of Finance, the Ministry of Budget and the CNP-PPP.
Once the contract is agreed, it is submitted for approval to the CNP-PPP, and then it is finally
signed by the contracting authority and the selected operator. In order to enter into force, the
PPP contracts between the state and contracting authorities other than local authorities need to
be approved by decree in the Council of Ministers (which includes the Minister of Budget for
assessing budgetary implications of the contract). The PPP contracts signed by local authorities
are countersigned by their guardianship and then approved by the Minister responsible for the
state budget. The CNP-PPP, at the end of these formalities, ensures the publication of a notice of
award of the PPP contract providing the details of the contractor and a summary of the contract
main clauses.