Regulations No 17 of 2011
Regulations No 17 of 2011
Regulations No 17 of 2011
REGULATIONS
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(Made under section 28)
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THE PUBLIC PRIVATE PARTNERSHIP REGULATIONS, 2011
PART I
PRELIMINARY PROVISIONS
Citation 1. These Regulations may be cited as the Public Private
Partnership Regulations, 2011.
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(a) performs an institutional function on behalf of the
institution;
(b) acquires the use of public property for its commercial
purposes;
(c) assumes substantial financial, technical and operational
risks in connection with the performance of the institutional
function or use of state property; and
(d) receives a benefit for performing the institutional function
or from utilising the public property, either by way of:
(i) consideration to be paid by the contracting authority
which derives from a revenue fund or where the
contracting authority is a central government or a
local government authority, from the revenues of
such authority;
(ii) charges or fees to be collected by the private party
from users or customers of a service provided to
them; or
(iii) a combination of such consideration and such charges
or fees;
“units” means the Coordination Unit and Finance Unit;
“unsolicited proposal” means a written proposal that is submitted to
a relevant contracting authority on the initiative of the private
party for the purpose of entering into a public private
partnership agreement with the Government.
PART II
IDENTIFICATION OF PROJECTS
Projects for 4.-(1) Subject to section 4 of the Act, the Minister shall
partnership determine and publish a notice in the Gazette specifying various
projects that may be undertaken by the public sector in partnership
with the private sector for a particular period as may be specified in
the notice.
(2) After publication of specific projects under sub-regulation
(1), a public sector shall, based on the published projects, select or
identify specific project or projects which can be undertaken in
partnership for a particular year or such period as the public sector
may determine.
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(2) The pre-feasibility study report shall be submitted to both
the Coordination Unit and the Finance Unit for approval prior to
undertaking of a feasibility study.
(3) The Coordination Unit, or as the case may be, the Finance
Unit may upon consideration of the pre-feasibility study report:
(a) approve the pre-feasibility study report and advise the
contracting authority to proceed with the feasibility study in
respect of the project; or
(b) reject the report and advise the contracting authority in
writing stating the reasons for the rejection.
(4) The pre-feasibility study report shall conform to the criteria
that:
(a) the project is in line with government priorities as per
national development plans;
(b) the project complies with the value for money requirement;
(c) the project complies with affordability requirement;
(d) the project presents a new and cost-effective methods of
service delivery;
(e) the project will address acute social needs sustainably;
(f) the private sector participation in the project will result into
net benefits and savings as compared to public
procurement;
(g) the project adheres to the Act and other relevant laws;
(h) the project includes adequate risk analysis and sharing; and
(i) it complies with other conditions relevant to the public
private partnership.
Funds for 6.-(1) The Minister responsible for Finance may establish a
feasibility Public-Private Partnership Project Development Facility with a
study
limited life span, and set conditions for contracting authorities to
access the funds from the facility.
(2) The Project development facility shall be an instrument to
enable contracting authorities to finance project preparation costs,
including financing of feasibility studies, costs of transaction
advisors and procurement of public-private partnership projects.
(3) The funds advanced from the facility to the contracting
authority may later be partly or fully recovered from the successful
tenderer.
(4) Access to funds from the project development facility shall
be subject to compliance by the contracting authority is criteria to
be prescribed by the Minister responsible for Finance.
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(g) a statement of the anticipated benefits or cost advantages
to the contracting authority including the total estimated
cost for developing the project and projected cash flow to
allow a meaningful consideration;
(h) a statement showing how the proposed project supports
the Government’s development plans; and
(i) a statement to indicate compliance with other relevant
laws and government policies.
Approval of 10. The contracting authority shall select the project concepts
project based on criteria that:
concepts for
unsolicited (a) the project is in line with government priorities and
proposals adequately meets the public interests;
(b) the project complies with the value for money
requirement;
(c) the project complies with affordability requirement;
(d) the project presents a new and cost-effective methods of
service delivery;
(e) the project will address acute social needs sustainably;
(f) the private sector participation in the project will result
into net benefits and savings as compared to public
procurement;
(g) the project exclusively belongs to the private party and
there are intellectual property rights to protect;
(h) the project adheres to the Act and other relevant laws;
(i) the project includes adequate risk analysis and sharing;
and
(j) it complies with other conditions relevant to the public
private partnership.
Rejection of 11.-(1) The contracting authority may reject the project concept
project if the project concept:
concept for
unsolicited
proposals
(a) does not meet conditions set under regulation 9;
(b) relates to institutional requirements that can be
acquired by normal competitive bidding or any other
method than public private partnership;
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(c) relates to products or services which are generally
available and can be mobilized through normal
investment procedures or public procurement;
(d) does not fall under the priorities set by the
contracting authority or the Government plans; and
(e) the private party is not legally permitted to undertake
the project due to financial incapability or is not a
lawfully registered company.
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(ii) detailed specification of the services to be delivered;
and
(iii) in the case of use of government property,
description of the property concerned and the types
of use the property may be subjected to;
Recommenda- 21.-(1) Upon receipt of the report from the committee, the
tion by the
Coordination
Coordination Unit shall, after consideration of the recommendations
Unit and advice of the committee:
(a) recommend the project for implementation in partnership
with a private party; or
(b) where necessary, require the contracting authority in
writing to rectify specific matters of the project or to
reconsider the implementation of the project.
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(2) Where the Coordination Unit recommends the
implementation of the project under this regulation, it shall:
(a) submit the project together with its recommendations for
approval to the Finance Unit; and
(b) in writing, notify the contracting authority accordingly.
(3) The Coordination Unit shall, in submitting the project to
the Finance Unit attach particulars regarding:
(a) the title type and location of the project;
(b) the Ministry or public sector responsible for the project
(c) cost and duration of the project;
(d) the name of the project officer;
(e) its findings and recommendations on the criteria of
affordability, value for money and prevailing national
development priorities; and
(f) any other information as may be required by the Finance
Unit.
PART IV
APPROVAL OF PROJECTS BY THE FINANCE UNIT
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(2) For the purpose of sub-regulation (1), the Finance Unit
shall study and consider the feasibility study for the project and all
financial implications relating to the implementation of the
project.
Committee of 24.-(1) The Finance Unit may, for the purpose of facilitating
Finance Unit the performance of its functions, form a committee of experts to:
(a) study and consider the feasibility study in respect of the
project; and
(b) make recommendations to the Finance Unit on the
financial implication risks involved and other financial
matters surrounding the implementation of the project
including-
(i) affordability of the project;
(ii) value for money;
(iii) risk sharing;
(iv) Government development priorities; and
(v) commercial viability.
(2) The size, composition, procedures, and terms of reference
of the committee shall be as may be determined by the Finance
Unit.
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(e) evidence of commercial, technical and socio-economic
as well as environmental viability;
(f) evidence of compliance with criteria for government
participation.
(3) For the purpose of sub-regulation (2), the criteria for
government participation to any public private partnership project
shall include-
(a) government approval prior to commencement of bidding
process;
(b) compliant feasibility study;
(c) prohibition of Government support for unsolicited project
proposals;
(d) a competitive bidding process resulting to a minimum of
two compliant tenderers as a condition precedent; and
(e) any other criteria as may be prescribed in the guidelines
for public private partnership projects appraisal.
Consideration 26.-(1) The Finance Unit shall, upon receipt of report under
by the Finance regulation 25, consider the findings and recommendations of the
Unit
finance committee and make decisions on the implementation of
the project.
(2) Where the Finance Unit refuses to approve the project
under sub-regulation (1), it shall:
(a) return the feasibility study report and other attached
documents to the Coordination Unit;
(b) give reasons for refusal to approve the project; and
(c) advice as to what should be done by the the contracting
authority to rectify or remedy the situation.
Reconside- 27.-(1) The Coordination Unit shall, immediately after
ration by the receiving the returned documents from the Finance Unit under
contracting
authority regulation 26, refer the matter to the contracting authority where it
originates for reconsideration with the view to address issues as
raised by the Finance Unit.
(2) After reconsideration of the matter, the contracting
authority may resubmit the project for approval by the
Coordination Unit, and the provisions of regulation 18 regarding
submission of application for recommendation shall apply
accordingly.
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Approval by 28.-(1) The Finance Unit shall if it is satisfied with the
the Minister contents of the feasibility study and findings regarding the
responsible for
finance financial implications and other financial matters, forward the
feasibility study together with its recommendations to the Minister
responsible for finance for approval.
(2) The Minister responsible for finance shall, subject to the
provisions of the Act, and within thirty days from the date of
receipt of the documents from the Finance Unit, approve the
project for implementation under public private partnership.
(3) The Minister responsible for finance shall, where approval
is not given within the time prescribed in this regulation, within
seven days after the expiration of thirty days notify the contracting
authority through the Finance Unit stating the reasons for such
delay.
Funds for 29. Upon approval of the project by the Minister responsible
implementation for finance under regulation 28 and where the approved project
of project
requires public funds for implementation, the Minister shall, if the
public funds are available, initiate the funding process and notify
the parties through the Finance Unit.
Suspension of 30. The Minister responsible for finance may, where the
project approved projects requires public funding and such funds are not
available for that purpose-
(a) suspend the implementation of the approved project for
such period as he may determine; or
(b) in consultation with the private party, solicit for such
funds required for implementation of the project.
31. The Minister responsible for finance shall, subject to the
provisions of the Act, refer all approved projects to the contracting
authority to proceed with advertisement for tenders and
subsequent implementation.
Refusal by the 32. The Minister responsible for finance may, if he is not
Minister satisfied with the findings and recommendations of the Finance
responsible for
finance Unit, refuse to approve the project and notify the parties
accordingly and shall state the reasons for refusal.
PART V
PROCUREMENT BY CONTRACTING AUTHORITY
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Advertisement 33.–(1) The contracting authority shall, after the approval of
Cap. 410 the project by the Minister responsible for finance under
regulation 28 and subject to the provisions of the Public
Procurement Act, advertise for tenders in respect of the projects
calling upon interested parties from private sector to apply for the
tender.
(2) Selection of the successful tenderer by the contracting
authority shall be in accordance with the provisions of the Public
Procurement Act.
PART VI
NEGOTIATIONS, AGREEMENT AND AWARD
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Agreement 37.-(1) The contracting authority may, for the purpose of
implementing the approved project, and subject to the provisions
of the Act, enter into a written agreement with the successful
bidder.
(2) The contracting authority shall, after approval of the
project by the Minister responsible for finance, process the
agreement with the private party for implementation of project
under partnership.
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Approval of 40.-(1) The contracting authority shall forward a draft
draft agreement agreement to the Finance Unit for onward submission to the
by Finance
Unit Minister responsible for finance for approval of the proposed
terms of the agreement.
(2) Where the Finance Unit finds that:
(a) there are eminent events outside the control of the
partners, which may intervene with the execution of the
project;
(b) there are construction and operational risks which may
cause the project to be delayed;
(c) there are commercial and financial risks which affect
the viability of the project;
(d) other risks which may cause loss to the Government,
it may refuse to approve the draft agreement or specify measures
to address such events and mitigate such risks.
Submission of 41. The contracting authority shall avail a copy of the draft
a copy of the agreement to the Attorney General.
agreement to
Attorney
General
Vetting of the 42.-(1) The contracting authority shall submit the draft
agreement agreement as approved by the Minister responsible for finance and
agreed by both parties to the Attorney General for vetting.
(2) The draft agreement submitted to the Attorney General
under sub-regulation (1) shall be accompanied by such other
documents as relating to the project or contracting parties as may
be necessary for clarity during vetting.
(3) The Attorney General shall, in vetting the draft
agreement, have regard to:
(a) the legality of the project;
(b) approvals by the Coordination Unit, Finance Unit and
the Minister responsible for finance;
(c) compliance with the existing laws;
(d) attachments to the agreement as prescribed by sub-
regulation (2);
(e) anything which may have an impact on the agreement.
(4) The Attorney General shall, after consideration of the
draft contract or agreement and any other attached documents,
provide a legal opinion on the draft contract and return the draft to
the contracting authority for final determination.
Approval and 43.-(1) The contracting authority shall, after receiving the
finalization of opinion of the Attorney General on the draft contract, consider the
contract
opinion and prepare the final draft of the agreement.
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(2) Where the opinion of the Attorney General have an
impact on the terms and conditions of the draft agreement as
agreed by the parties, the contracting authority shall immediately
notify the private party on the new terms or consideration of new
terms.
(3) Upon agreement by both parties, a final draft of the
agreement shall be prepared for signature by the parties.
Signing of 44.-(1) The accounting officer shall, upon being satisfied with
agreement the contents of the agreement, sign the agreement on behalf of the
contracting authority.
(2) After the signing of the agreement, the contracting
authority together with the private party shall commence the
process for implementation of the project.
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(3) The accounting officer shall be responsible for the
service delivery through the project facilities as if the facilities
were being managed and operated directly by the Government,
and in so doing shall ensure-
(a) maintenance of the facilities developed by the project
on regular basis;
(b) service delivery is at an acceptable level in terms of
quality and reliability;
(c) regular and annual performance reports are submitted
to the Government and Parliament;
(d) the facilities are subjected to regular accounting and
auditing;
(e) technology transfer and training of counterpart
management to take over the management of the
facility; and
(f) smooth transfer of assets.
PART VII
TERMINATION OF PROJECTS
Termination of 47.-(1) The contracting authority shall have a right to
the project terminate the project due to:
(a) inefficient implementation of the project by the private
party;
(b) failure to meet the deadline set for the project by the
private party;
(c) unforeseen events, beyond control of the private party;
(d) breach of agreement by the private party;
(e) non performance of the private party in service delivery
as per agreement; or
(f) force majeure:
Provided that, where the project is terminated under sub-regulation
(1)(c) and the private party suffers loss, he shall fairly be
compensated.
(2) Where the project is terminated for the failure of the
private party to meet its obligations set under the agreement, the
private party shall, after the expiration of thirty days from the day
of notification, compensate the contracting authority for damages
or losses suffered.
(3) Upon termination of the project for reasons other than
unforeseen events, the contracting authority may, in pursuance of
the Act and these Regulations, engage another party.
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48.-(1) The private party shall have a right to terminate the
project if the contracting authority fails to fulfil its commitment set
under the agreement.
(2) Before the project is terminated for the failure of the
contracting authority to fulfil its commitment set under the
agreement, the contracting authority shall, within thirty days, be
required to remedy the inefficiencies.
(3) Where the contracting authority fails to remedy the
inefficiencies under sub-regulation (2) within the prescribe period,
the contracting authority shall compensate the private party for the
damages or losses suffered.
PART VIII
GENERAL PROVISIONS
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SCHEDULE
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TITLE: ………………………...………………………………………………………….
SIGNATURE: ……………………………………………………………………………………
DATE: ……………………………………………………………………………………
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JC/I.60/10/14 20 June 2011
Permanent Secretary,
Office of Prime Minister,
DAR ES SALAAM.
Please refer to your letter with Ref. No. EA. 296/349/01 dated 23rd May,
2011.
Attached herewith are the afore mentioned Regulations for your perusals
and the Hon. Minister’s signature. Kindly, after the signing of the Regulations by
the Hon. Minister, the original and one copy should be returned to our Office for
publication purposes.
S.A. Nzori
For: DEPUTY ATTORNEY GENERAL
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