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17 november: Commission proposes clarification of EU rules on public-private partnerships

IP/05/1440

Brussels, 17 November 2005

Public procurement: Commission proposes clarification of EU rules on public-private partnerships

The European Commission has published a Communication with new policy options on Public-Private Partnerships (PPPs). The Communication follows a major public consultation which was launched by the PPP Green Paper in April 2004 ( IP/04/593 ). The Commission will clarify how EU rules should apply to the choice of private partners in "institutionalised PPPs", which are public-service undertakings held jointly by both a public and a private partner. The Commission will also assess whether to propose a legislative initiative on concessions, to clarify both the term 'concessions' and the rules applicable to their award.

Internal Market and Services Commissioner Charlie McCreevy said: "PPPs are vital to investment in Europe's infrastructure and public services. But to reap the full benefits of these partnerships and ensure value for money for taxpayers, we need transparency and fair competition in the selection of private partners. The goal towards which we strive is to provide transparent and non-discriminatory conditions that will enable private entities to contribute to setting up infrastructures and provide services throughout the EU in a way that delivers best value for taxpayers. We have now listened to all the views expressed during the consultation, which show a strong demand for further Commission action."

A key aim of the 2004 consultation was to find out how the rules and principles work in practice and to see if they are clear enough and if they suit the challenges and characteristics of PPPs. The options are presented with a view to ensuring effective competition for PPPs without unduly limiting the flexibility needed to design innovative and often complex projects.

Institutionalised PPPs
Many respondents to the PPP Green Paper asked how EU rules should apply to the choice of private partners in "institutionalised PPPs" (IPPPs), which are public-service undertakings held jointly by both a public and a private partner. Overall, it appears at present that an Interpretative Communication would be better suited to this demand than fully-fledged legislation. This Interpretative Communication should be published during 2006.

Concessions
A clear majority of participants in the consultation supported an EU initiative, legislative or non-legislative, on concessions, in order to clarify both the term 'concessions' and the rules applicable to their award. Having carefully considered all arguments and the factual information provided by stakeholders it appears that a legislative initiative is at present the preferable option. However, the final decision on whether or not to take such a measure, and on its concrete shape, depends on further in-depth analysis, including an Impact Assessment, which will be carried out in 2006.

Background
Public-private partnerships (PPPs) are forms of cooperation between public authorities and businesses, which aim to carry out infrastructure projects or providing services for the public. These arrangements which typically involve complex legal and financial arrangements involving private operators and public authorities have been developed in several areas of the public sector and are widely used within the EU, in particular in transport, public health, public safety, waste management and water distribution.
The full text of the proposals is available at:
http://europa.eu.int/comm/internal_market/publicprocurement/ppp_en.htm