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Hi there!

I'm Margaret, a female traveller from Nigeria, and welcome to my personal blog , TheAjalaBug.com.

Here, I document my adventures in travel and life experiences generally. Hope you get inspired!

Legal and Regulatory Framework for Infrastructure Concessions

Legal and Regulatory Framework for Infrastructure Concessions

The government is responsible for issuing a Concession and may decide to enact a PPP law or a concession law for a number of reasons.

  1. to give priority to a process of developing, procuring and reviewing PPP projects that will take priority over sector laws, or to establish a clear institutional framework for developing, procuring and implementing PPPs.

  2. to close any gaps in other laws to allow for successful infrastructure PPP projects, such as enabling the grant of step-in rights to lenders and requiring open and fair procurement processes.

Each jurisdiction has its own regulatory framework for issuing a concession in the most transparent manner. No infrastructure development can take place without having an Act, PPP units or sectoral laws in place first. Should you intend to pursue a concession in any country, it is important you find out the supporting laws and/or Act of the country. In Nigeria we have a few both at the federal level and at the state level which are the Infrastructure concession regulatory commission Act, the State PPP Law etc

Infrastructure Concession Regulatory Commission (ICRC) Establishment Act 2005:

  1. ICRC drives and regulates infrastructure concessions relating to federal infrastructure, or in which the Federal Government of Nigeria has a contingent liability

  2. Provides general policy guidelines, rules and regulations for the operation of PPPs in Nigeria

  3. Ensures robust, transparent, efficient and equitable processes are developed and consistently applied for managing the selection, development, procurement, implementation and monitoring of PPP projects

  4. Ensure that the advantages and requirements of PPPs are well appreciated at the National level amongst potential investors and by other relevant stakeholders

  5. Established The Africa PPP Network to bring all stakeholders together

The National Policy on Public Private Partnerships 2009

The National PPP Policy defines a public private partnership as

“A wide range of contract forms—in turn represented by numerous acronyms (BOT, DBFO, BOOT, etc.) which falls within the scope of the term ‘public private partnership’. It can be said to include: outsourcing and partnering; performance-based contracting; design, build, finance and operate (or build operate transfer) contracts; and, sometimes, concessions.”

The Public Procurement Act 2007 (PP Act)

Under the PP Act of 2007, the following the Special and restricted methods of procurement. This simply implies that the Private sector, who may have identified the opportunity, can kick-start the concession conversation through unsolicited offers. There’s actually to guide to implementing unsolicited proposals

  1. Unsolicited offers (Art. 3, Part II of N4P)

  2. Two stages tendering (Art. 39 of PP Act)

  3. Restricted tendering (Art. 40 of PP Act)

  4. Direct procurement (Art. 42 of PP Act; Art 5 of ICRC)

  5. Emergency procurement (Art. 43 of PP Act)

PUBLIC SECTOR PROJECT EVALUATION

Under the Public Procurement Act, Project evaluation usually comprises of the several stages

  1. identification of a need

  2. systematic appraisal of technical solutions to the identified need

  3. preparation of economic, social and environmental cost benefit analysis, and an Environmental Impact Assessment, if required (if time permits I will explain all about ESG soon)

  4. value for money (VfM) analysis and affordability testing of different procurement options

  5. preparation of financial analysis - the pre-feasibility study

  6. budget allocation within the National Development Plan and, subsequently, the Medium-Term Expenditure Framework (MTEF)

  7. approval of Outline Business Case (OBC) prior to the commencement of procurement. - Procurement Planning (Art. 18 of PP Act)

Other States in Nigeria with respective PPP offices

Various states including Rivers State, Cross River State, Ogun State, and Ekiti State, amongst others, have followed the Lagos State example and established their own PPP offices. Below is a snapshot of the Lagos State PPP Law

Lagos State PPP Law 2011

  1. Repealed and replaced the Lagos State Roads (Private Sector Participation) Authority Law, No.7 of 2007 (the “Roads Infrastructure Law”), which previously repealed and replaced the 2004 Roads Infrastructure Law

  2. Provides a broader mandate to engage the private sector on delivering infrastructure beyond roads, highways and bridges – covers other infrastructure sectors

  3. Legally established the Lagos State Office of Public Private Partnerships (“OPPP”)

  4. OPPP is focused on accelerating the development of infrastructure in Lagos State, with the vision of making Lagos Africa’s Model Megacity

FINAL THOUGHTS

The general governing key principles are ensuring transparency, competitive bidding, public interest, value for money, adequate risk allocation, capacity to deliver, engaging with the market and output requirements.

Listed above are some of the applicable laws in Nigeria but always ensure you check if there has been any amendment to the law before proceeding. The World Bank Group also has PPP legal resource center with a bunch of information on International Guidelines etc.

Thank you all for always reading and for sending me messages on how informative my articles have been. Please feel free to share your experiences, other applicable laws you know and your thoughts with me in the comment section.

Until my next article, be kind to one another.

Margaret.

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