UNCITRALThird International Colloquium on Public-Private Partnerships (PPPs) 23-24 October 2017, Vienna Good afternoon all, my name is Neli Garbuzanova and I am the leader of the group for Chapter III Selection of the Concessionaire. I would like to thank all experts from the group for their invaluable and timely contributions. I will be presenting on behalf of the group and my group members will be helping with questions and further explanations on their areas of expertise. Experts for Chapter III, October 2017: Mikel Tejada Ibanez Petra Ferk Ricardo Seidl Fonseca Assiba Djemaoun Kristen Stewart Caroline Nicholas (UNCITRAL) Neli Garbuzanova

CHAPTER III SELECTION OF THE CONCESSIONNAIRE OVERVIEW 23 Model Legislative Provisions (Section II MP 5 -27) 26 Legislative Recommendations (LR 14 – 39) 40 pages in the Legislative Guide “Concessionaire” (Webster): the owner or operator of a concession; for example, one that operates a refreshment stand at a recreational centre http://www.uncitral.org/uncitral/en/uncitral_texts/procurement_infrastructure.html - this link provides translations of the texts and titles in the main UN languages. Before presenting the recommendations and the proposals for this chapter, I would like to quickly summarise the references to the selection/procedure in the Legislative Guide, Model Legislative Provisions and the Legislative Recommendations. In total, 23 Legislative Model Provisions, 26 Legislative Recommendations and 40 pages of guidance in the legislative guide. There is some duplication between the Model Legislative Provisions and the Legislative Recommendations. For example, Legislative Recommendation 14 and Model Legislative Provision 5.; Model Provision 7 and Recommendation 15. There is also some topics covered in more details in Model Legislative Provisions (8) comparing to the Recommendations (16).

CHAPTER III SELECTION OF THE CONCESSIONNAIRE GENERAL RECOMMENDATIONS Align with Model Law on procurement and clarify relation with procurement principles and law (address “grey” areas) Strengthen transparency, general principles of selection, governance, confidentiality (degree/stage) and conflicts of interest Update terminology and clarify relationship with other Chapters (definition, disputes, contract) Recommend competitive procedures as norm and clarify exemptions Consider two-stage procedures as beneficial if appropriately set. Following comments and discussions the group makes the following general recommendations in relation to chapter III - Bullet points above appear clear from technical terminology

Emphasis on transparency and due diligence CHAPTER III SELECTION OF THE CONCESSIONNAIRE PROCEDURES - I Emphasis on transparency and due diligence Include option for online tendering and electronic means of communication Consider difference between pre-qualification, admissibility, eliminatory criteria Expand on consortia bidding (inc. modifying consortia) and anti-monopoly control Distinguish the requirements of PPP contracting party and of lenders Clarify reference to domestic preferences (pros and cons) In particular, Chapter III can be improved in the following areas – see bullet points “Due diligence” (Webster): the appropriate or proper diligence under the circumstances “Tendering” (online Cambridge dictionary): he process of choosing the best or cheapest company to supply goods or do a job by asking several companies to make offers for supplying the goods or doing the work: “Consortia” (Investopedia): A consortium is a group made up of two or more individuals, companies or governments that work together toward achieving a chosen objective. Each entity within the consortium is only responsible to the group in respect to the obligations that are set out in the consortium's contract. “PPP” – public private partnership 2Domestic preference” preferencial treatment to local items/products/suppliers;

CHAPTER III SELECTION OF THE CONCESSIONNAIRE PROCEDURES - II Redraft section on evaluation criteria and systems for evaluating two-stage bids; discuss shortlisting by default Clarify required documentation and price charged for pre-selection documents Review approaches to reduce bureaucracy (self-declare) and bids preparation time Review approach to negotiation with bidders during process – when and how Amend part on final negotiations and award (fine-tuning and extent of modifications) Consider implications on contract formation, information governance, data protection In particular, Chapter III can be improved in the following areas – see bullet points “shortlisting by default” – to require shortlisting of bidders in all cases; part of the requirements for any procedure (one or multi-stages). “pre-selection” – a stage in the bidding process

UNSOLICITED PROPOSALS CHAPTER III SELECTION OF THE CONCESSIONNAIRE UNSOLICITED PROPOSALS Debate inclusion or exclusion of unsolicited proposals; reconsider giving advantages Subject unsolicited proposals to rules as competitive process; add public interest Consider relation between initiation of unsolicited proposal and competitive process EXEMPTIONS Clarify, verify and narrow exemptions (urgency not due to lack of planning; for short time and requirement to launch process in due time) Expand on rationale for award with direct negotiation - different treatment of low/high value projects; lighter process rather than no process; align with procurement In particular, Chapter III can be improved in the following areas – see bullet points “unsolicited proposals” (US state): a written application for a new or innovative idea submitted to an agency on the initiative of the offeror for the purpose of obtaining a contract with the government, and is not in response to a request for proposals

CHAPTER III SELECTION OF THE CONCESSIONNAIRE NOTICES Consider a dedicated website for publication of notices/opportunities Expand on notice (notification of decision to all); consider notice on modifications Update award notice to include grounds for selection and rejection Add information to be included in notices; timescales; sanctions for not publishing REPORTING Strengthen reporting during and at the end of the process Consider sharing minutes from meetings REVIEW Ensure consistency of review with the general public procurement procedures Consider a standstill period between the award and contract conclusion. In particular, Chapter III can be improved in the following areas – see bullet points “standstill period”: a period between notification of the decision to award a contract and before the contract is signed.

CHAPTER III SELECTION OF THE CONCESSIONNAIRE CONCLUSIONS Update UNCITRAL documents (redraft, clarify, combine, reduce) Focus on transparency, due diligence, procedural efficiency Align with procurement principles and law if possible Consider competitive processes and recommend two-stage Be clear on exemptions and unsolicited proposals. In conclusion, we recommend that: - Bullet points above appear clear from technical terminology

Issues for other Chapters Update feasibility and other studies; subject unsolicited proposals to project screening. Address accounting issues influencing project structures (IPSAS, IFRIC) Consider effects of participation of international financial institution (if this affects bankability) Explore effects of loan agreements on obligation to provide finance information (if this affects bankability). Discuss user fees and availability payment based PPPs and the relationships with the preparation and selection stage Explore approaches to preparation of selection procedure (agencies, one- stop shop) Address qualifications of evaluation panel members and use of experts. We have added a slide regarding issues for other chapters so that we don’t lose the feedback received and coordinate/align with the rest of the text: “Feasibility study” (Investopedia): A feasibility study is an analysis of how successfully a project can be completed, accounting for factors that affect it such as economic, technological, legal and scheduling factors. Project managers use feasibility studies to determine potential positive and negative outcomes of a project before investing a considerable amount of time and money into it. “IPSAS” - The International Public Sector Accounting Standards “IFRIC” - International Financial Reporting Interpretations Committee “Bankability” (Cambridge Dictionary) – “ability to make money”; European Investment Bank explanation – “put simply, a PPP project is considered bankable if lenders are willing to finance it”. “Availability payment” – financing and project delivery alternative for projects which are not feasible under a user-fee based project.