ppp center (law)

KAZAKHSTAN PPP CENTERC O M P A N Y P R O F I L E

KAZAKHSTAN PPP CENTER

MISSION

We unite the capabilities of state and business for the benefit of people

Kusainov M. A.

Chairman of the Board of Directors, First Vice-Minister of Ministry National Economy of the Republic of Kazakhstan.

ABOUT THE CENTRE OF PPPJoint-stock company “Kazakhstani Centre of Public-private partnership” (hereinafter – the Centre of PPP) is created in accordance with the resolution of the Government of the Republic of Kazakhstan dated July 17, 2008 No. 693 “On creation of specialized organization on the issues of concession”. The sole shareholder of JSC “Kazakhstani Centre of Public-private partnership” is the Government of the Republic of Kazakhstan represented by the Ministry of economic development and trade of the Republic of Kazakhstan.

Oinarov A. R.

Chairman of the Board

By 2020 to have successfully implemented public-private partnership projects accounting for 20% of total investment with state participation in the country.

- We take the responsibility and make the decisions within our responsibility; - We do our work honestly and take pride in it; - We find the decisions advantageous for the state, business and population of the country; - We act focusing on the result and long-term prospect; - We respect ourselves and people and build long-term relations with everybody.

10 | Dubai Education Overview | Growth Potential in a Competitive Environment | Colliers International MENA

ABOUT PPPWhat is the Public-Private Partnership?

The main goal of the Public-Private Partnership is the development of infrastructure in the public interests via the combination of resources and experiences of the government and business, and implementation of socially significant projects with minimum expenditures and risks while still providing services of high quality to economic subjects.

In general, Public-Private Partnership is a system of medi-um-term and long-term relationships between the government and the private sector for the provision of socially significant services of projection, financing, construction, reconstruction, rehabilitation, and exploitation or servicing of objects by the private sector on behalf of the government.

The fol lowing understanding of the PPP can be applied to Kazakhstan. The Public-Private Partnership is an aggregate of medium-term and long-term relat ionships between the government and the private sector for the provision of socially signif icant works or/and services of projection, f inancing, construction, reconstruction, rehabilitation, and exploitation or servicing of objects by the private sector in accordance with basic principles of the PPP.

The basic principles of the PPP:

v Equality and freedom.v Stability of the contract (the possibility of its alteration and adaptation).v Continuity of service provision.v Competitiveness.v Transparency and reverse connection (feedback).v Non-interference.v Guarantees.v Onerousness.v Equality of rights (non-discrimination).

The basic features of the PPP are:

v Medium-term and long-term relationships;v Parties in the PPP are represented by the government and the private sector;v Interaction of the parties in the PPP are registered in the appropriate contracts;v Mutually advantageous distribution of risks, benefits, rights, and obligations between the partners;v Definition of the criteria of performance achievement of the PPP object by the governmental sector.

КАЗАХСТАНСКИЙ ЦЕНТР ГЧП

PPP FORMS

Public Private Partnership

Institutional PPP implemented within the framework of legal entities with the participation of State and private businesses in the procedure established by the laws of the Republic of Kazakhstan.

Contractual public-private partnerships implemented under the concession agreements, and property rental trust management of state assets the manner prescribed by this Act or other laws of The Republic of Kazakhstan (types of contracts - ВТО, ВОТ, ВТL, ВОО, ROO, Asset management, leasing, ROT).

v Construction and operation of kindergartens;v Construction and operation of residence halls;v Technical management of schools;

v Construct ion and operat ion of health facilities

v Water supply and wastewater disposal; v Municipal solid waste treatment; v Reconstruction and operation thermal generation

capacity and distribution networks;

v Construction of power plants (renewable energy); v Maintenance of electric distribution networks;

v Construction and operation of roads; v Construction (reconstruction) and operation

of railway, bus and airport terminals; v Construction of parking.


Education

Healthcare

Housing and utilities

Energy

Transportation

Models of PPP in international practice

TYPES OF PPP CONTRACTS

Considering market dynamics & average school capacity per curriculum following number of new schools will be required in Dubai 2020

British 19 Schools America

10 Schools India

19Schools

10Schools

American

9Schools

Indian

2Schools

IB

12Schools

Others

Considering market dynamics & average school capacity per curriculum following number of new schools will be required in Dubai 2020 During the period between 2016 and 2020, the

private education market will require an addition of 52 educational facilities across multiple curriculum's, which translates into an approximate annual demand of 13 new schools.


10 Schools India

9 Schools

IB

BTO BOT BOO BOOT DBFO

360,000 • Short-term and long-term partnership;• The parties of PPP are public and private sectors; • Interaction of the parties in the PPP are formalized in the relevant agreements;• The mutually beneficial distribution of risks, benefits, rights and responsibilities between partners;• Define criteria to achieve performance on the PPP project by public sector.


Build-Transfer-Operate

Build-Operate-Transfer

Build-Own-

Operate

Build-Own-

Operate-Transfer

Design-Build-

Finance-Operate

DBFOT

Design-Build

-Finance-Operate-Transfer

Despite to common principles and featuresof PPP for all countries, there is no single

definition of PPP and classification of PPPforms in the international practice, as well

as the standard application circuit. Eachcountry independently defines them for

itself based on the principle of acceptancefor its own economy.

Source: Dubai Statistics Centre, 2014


CONCESSION LAW (since 2006)• The Law of the Republic of Kazakhstan dated 7 July 2006 No. 167• The law defines the legal terms of the concession, the concessionaire types of statesupport and regulates public relations arising in the process of conclusion, executionand termination of concession agreements.

MAJOR AMENDMENTS TO THE CONCESSION LAW (2013-2015)

- Availability payment, off-take contract- Long-term rates for PPP projects- The minimum share capital reduced to 10% of the cost of concession project- Direct agreement, step-in-rights- New types of contracts (BOT, BOO, O&M, DBFO etc.)- Transparency of procedures: a two-stage tender- Institutional support for PPP projects was developed and divided into- National level (Kazakhstan PPP center) and the regional level (regional PPP centers)

MEASURES OF STATE SUPPORT

- Compensation of investment costs up to 100%- Guaranteed minimum profitability- Subsidies for operational activities- Providing land and infrastructure- Guaranteed off-take contracts


PPP LAW (since 2015) NOVATIONS

Expanding PPPØ all sectors of economy Ø wide range of potential participants Ø corporate management in PPP projectsØ domination of PPP agreement

For partnersØ private financial initiative Ø simplifying of PPP proceduresØ competitive dialogue from idea to entering into agreementØ government support Ø financial support Ø international arbitration

For lendersØ direct agreement Ø step in rightØ protection from sequestrationØ hedging of currency riskØ termination payments

For allØ shareholders agreement Ø providing services and advice by PPP centerØ political will Ø no bureaucracy

Considering market dynamics & average schoolcapacity per curriculum following number of newschools will be required in Dubai 2020


Considering market dynamics & average schoolcapacity per curriculum following number of newschools will be required in Dubai 2020 During the period between 2016 and 2020, the

private education market will require an addition of52 educational facilities across multiple curriculum's,which translates into an approximate annual demandof 13 new schools.


10 Schools India

9 Schools

IB

Schools


CONTRACT PPP

NEW TYPES

LEASING INNOVATIONS

Long-term lease of private property

implementation of new technologies

LIFE CYCLE CONTRACT

INNOVATIONS

The entire life cycle of the project (roads,railway transport)

Service &Modernization

JOINT VENTURE

Private partner

Public Partner

JV

Alternative to state entrepreneurship

Public and private partnership form upequity for lenders

The mechanism of withdrawal of the state from the project

INSTITUTIONAL

TYPES OF PPP


GOVERNMENT PRIVATE PARTER NATIONAL COMPANIES

PAYMENTS

GOV. SUPPORT

q Land q Government financial support q Equity formation q Utilities & Infrastructure q Transfer of government property

q Funding q Management q Design q Intellectual property

q Service provision q Transfer of property q Co-funding q Service

· subsidies · management fee · availability payment

· state guarantee · transfer IP · provision of in-kind grants · co-funding · guaranteed procurements

PARTICIPANTS


FEATURES

Project was initiated by private partner

or

Project is inextricably linked with innovations

Without tender procedures

PRIVATE FINANCE INITIATIVE

11 | Dubai Education Overview | Growth Potential in a Competitive Environment | Colliers International MENA

Kazakhstan Public-Private Partnership Center JSC65, Temirkazyk St. 3th floorAstana, 010000,Republic of Kazakhstanwww.kzppp.kzTel.: +7 (7172) 701 745Fax: +7 (7172) 701 [email protected]

ppp center (law)

Economy & Finance