Project Bank Notification for PPP Projects

21
Feb
2019

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On 30 November 2018, the President’s Office issued a Notification on a publicly assessible database, the Project Bank, which will help to regulate Private Public Partnership (“PPP”) projects in Myanmar.

The government hopes the Project Bank will enable greater transparency, facilitate cooperation between different government agencies, and strengthen fiscal policy on infrastructure.

The primary purpose of the Project Bank is to monitor prioritized PPP projects with total values exceeding MMK2 billion (approximately US$ 1.3 million). It should be noted that PPP projects exceeding US$100 million require Cabinet approval.

Traditionally, each government department or agency would partake in PPP projects without supervision from a centralized entity. However, under the Notification, the PPP Center, established under the umbrella of the Ministry of Planning and Finance (the “MOPF”), will be responsible for assessing the criteria of all PPP projects that will be implemented by relevant government departments or agencies referred to as the Implementing Government Agency (the “IGA”).

In a general sense, the PPP Center will establish guidelines and draft templates as well as procedures for regulating PPP projects. In addition, the MOPF will update the Project Bank and set limits on government guarantees. Finally, the IGA will take a more practical role in implementing PPP projects by conducting pre-feasibility studies, signing PPP contracts, and selecting successful bidders.

PPPs include the following types of projects, among others: Availability Payment, Build-Own-Operate, Build-Operate-Transfer, Build-Transfer-Lease, Build-Transfer-Operate, and Operation and Management.

One of the key provisions of the Notification is the procedure for obtaining government support, which includes, but is not confined to, viability gap funds and government guarantees.

According to the Notification, PPP projects that engage in partnerships with government and participate in a competitive tender or Swiss challenge shall be eligible for government support. All unsolicited proposals shall proceed with a Swiss challenge. However, an exception has been made for unsolicited proposals of Greenfield projects in the energy and mining sector. The details regarding obtaining government support for these kinds of proposals have yet to be clarified.

The annual limit of government support will be set out by the MOPF and eventually published in the Union’s Budget Law.
It should also be noted that the Project Bank will be updated on a quarterly basis.

AUTHOR
Khin Sandar Win

Khin Sandar Win
Legal Associate
Energy and Infrastructure Team
VDB Loi, Myanmar

Sandar is a graduate of the University of Southern California. She has experience in working at a real estate firm on land acquisition issues. She assists the Energy and Infrastructure team with clients on land due diligence and supporting senior staff member with negotiation and explanation of power project agreements to local authorities.

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