1. LEGISLATIVE FRAMEWORK FOR ROAD INFRASTRUCTURE IN ZIMBABWE MINING & INFRASTRUCTURE INDABA, 2015

2. OVERVIEW OF CURRENT ROAD TRANSPORT LEGISLATION Various pieces of legislation governing or impacting road transport sector. Framework is fragmented and there are overlaps, ambiguities, and lack of clarity. Acts governing or impacting the road transport sector include the following: 1.Roads Act 2.Toll Roads Act 3.Road Traffic Act 4.Traffic Safety Council Act 5.Road Motor Transportation Act 6.Vehicle Licensing & Registration Act 7.Urban Areas (Omnibus Services) Act 8.Urban Councils Act 9.Rural District Councils Act 10.Regional, Town, Country and Planning Act 11.Central Mechanical Equipment (Commercialization) Act 12.One Stop Border Posts Act 13.Railways Act This presentation will focus on only 4 of the above statutes which 4 are pertinent to road infrastructure.

3. 1. ROADS ACT [Chapter 13:18] Establishes the Road Fund and administration thereof, and provides for the planning, development, construction, rehabilitation and management of the roads network of Zimbabwe. Also establishes ZINARA and Roads Authorities who are to implement the planning, development, construction, rehabilitation and management of the roads network of Zimbabwe. The functions of ZINARA include the fixing and collection of road user charges for the benefit of the Road Fund as well as the allocation and disbursement of monies from the Road Fund for purposes of implementing routine and periodic maintenance works on the roads under the jurisdiction of Road Authorities. ZINARA is therefore basically an administrator. Road Fund only meant for routine maintenance works or emergency works therefore vast opportunities for the private sector to participate as funders of road construction, rehabilitation and upgrading works which are not catered for by Road Fund. Private sector can also participate in the planning, designing, construction, maintenance and rehabilitation of any road when contracted by road authorities through a public tender processes in terms of the Procurement Act.

4. 2. TOLL ROADS ACT [Chapter 13:13] Provides for the charging, levying and collecting of tolls for the use of vehicles on certain roads. The MoTID may declare any road a toll–road and to authorize the persons who were responsible for the construction & maintenance of the road to levy and collect toll fees in respect of any toll-road. Bridges or ferries over which a road that is accessed by the public passes also qualifies to be declared a “toll-road”. E.g New Limpopo Bridge (Private) Limited which constructed the bridge that extends across the Limpopo River between the Zimbabwean and South African Border Posts which was declared to be a toll road and New Limpopo Bridge (Private) Limited authorized to collect tolls on vehicles using such bridge. Since 2009, all Regional Trunk roads and City to City Trunk Road Network Roads were declared to be toll roads and ZINARA is authorized to levy and collect toll fees for the benefit of the Road Fund and, in turn, for the maintenance of the toll roads.

5. 3. URBAN COUNCILS ACT [Chapter 29:15] Confers road infrastructure functions of town councils, municipal councils and local boards. Functions include: provision and maintainance of parking places which function may be subcontracted to private entities e.g South African Easi Park and City of Harare In terms of sections 209 and 210 of the Act, councils are also empowered to enter into contracts with any person for any of their functions such as road construction and maintenance services (over urban roads only) ordinarily through public tendering process save in instances where a council resolves and declares that it would be against the best interests of the town or municipality to invite tenders. Under Part XVI of the Act, councils are also empowered to enter into JVs governed by a Deed of Agreement with prescribed terms which include contributions by each party, the raising of loans for the project the income or profit to be payable to each of the contracting parties, etc. It appears that the cooperation provided for under Part XVI is more of a PPP nature that is different from the awarding of contracts through the tendering processes as anticipated under sections 209 and 210 of the Act. The borrowing powers of councils also allow for private sector participation as funders of those transport sector projects that are within the control of the councils.

6. 4. RURAL DISTRICT COUNCILS ACT [Chapter 29:13] Save for a few differences, the relevant provisions are nearly identical to those contained in the Urban Councils Act discussed above. Section 82 of this Act pretty much provides for the possibility of PPP or joint venture arrangements between rural district councils and the private sector in the discharge of some of the functions of the councils which functions include the planning, design, construction, maintenance, rehabilitation, upgrade and management of roads and bridges as well as provision of commuter transport services. However, as far as jurisdiction is concerned, rural district councils only have the power to construct tertiary roads and not the major regional or national roads which are under the jurisdiction of the Department of Roads under MoTID.

7. THE JOINT VENTURE BILL ROAD TO SUCCESS? A promising piece of impending legislation…

8. Summary of key provisions and likely impact on private sector participation in road transport infrastructure The Bill seeks to provide for the implementation of JV agreements between Ministries or public entities and private persons and to establish a set of rules governing public-private procurement. It is essentially a PPP Bill. A JV agreement is defined as one that has the following characteristics: 1. The parties: on one hand, Contracting Authorities (i.e. Gvt Dept/ Ministries/Public entity) and the Counterparty being a private entity; 2. Counterparty undertakes to perform a Contracting Authority’s function for a specified period; 3. Counterparty receives a benefit for performing such function by way of funds obtained by way of loan by the contracting authority or user levies or revenue generated from the project or a combination thereof; 4. Counterparty is liable for risks arising from the performance of the function; and 5. Public resources may be transferred or made available to the Counterparty.

9. JV BILL (contd) The Bill seeks to open up all areas that government departments and public entities had been operating in to private sector participation. The Bill actually states that the JV provisions override provisions of all other enactments regarding functions previously reserved for public entities. When it comes to the definition of a contracting party, the Bill makes no distinction between indigenous, or local and foreign counterparties. International private investors are therefore not barred from concluding the JV Agreements. Part I of the Bill’s Schedule, specifically lists various transport related projects such as roads, bridges, inland ports, inland container depots and logistics hubs, petroleum pipelines and urban transport systems as the types of the JV projects that are envisaged. In this respect, the Bill, should it be passed into law, presents the greatest encouragement to private sector participation in the development of transport infrastructure and provision of transport services in the past two decades or so.

10. JV BILL (contd) Part II of the Schedule to the Bill contains an all-inclusive list of joint venture agreements such as BT, BLT, BOT, BOOT, ROO, Management Contracts etc. The Bill also seeks to establish a JV Unit that will report to a JV Committee. The Committee to be comprised of the Secretaries of various ministries which include MoTID, Local Government, Economic Planning amongst others. The Committee will be responsible for making recommendations to Cabinet as to whether or not to approve or reject project proposals submitted to it by the Unit. Private sector may submit unsolicited bids or unsolicited expressions of interest which will then be referred to the JV Unit for assessment before feasibility studies can be conducted and the project eventually referred to Cabinet by the Committee. All projects & JV agreements have to be approved by Cabinet failing which any JV agreement in respect of an unapproved project would be null and void. However, JV agreements may be concluded without Cabinet approval i.e. through tender processes or where a contracting authority has pre- identified a counterparty provided that project to be implemented under the joint venture agreement would have been approved by Cabinet.

11. CONCLUSION As part of the assessment in the drafting of the NMTP, it has been noted that there are too many pieces of road transport legislation (about 12 acts and various regulations thereunder) which does not conform to best international practice. There is need for creation of a set of comprehensive legislation to deal with the road transport sector in clearly demarcated sub- sectors such as public passenger transport services on their own, road freight transport on its own and the roads infrastructure on its own. The assessment further noted that, in general, most of the existing laws do not provide, in clear and certain terms, the extent to, and the manner in, which private players may participate in the provision, maintenance and management of transport infrastructure. However, the JV Bill is quite promising and should it be enacted into law, we are likely to see increased private sector participation in the transport sector, particularly since the JV Bill supercedes all other laws with regard to the manner of private sector participation in functions presently reserved for state entities.

12. THE END www.maweresibanda.co.zw