Procuring Infrastructure Public-Private Partnerships

In 2008, the Zambian government approved a policy framework for the implementation of PPPs covering stakeholder roles, protection of public interest, value for money and service quality. The Public Private partnership Act No. 14 was passed by the parliament on August 26, 2009 (hereinafter the PPP Act). PPP processes for projects in the transport, water and sanitation sectors have been following this framework. This Act is completed by the Public Procurement Act No.12 of September 23, 2008, amended by the Bill of 2011 (hereinafter the PPA), according to Section 20 of the PPP Act that provides that "(ii) where this Act or the bidding documents do not specifically provide for a process, commission, omission, offence or penalty in relation to any aspect of the procurement process relating to public-private partnerships, the Public Procurement Act, 2008, shall apply".

PPP Act: https://www.zambialii.org/zm/legislation/act/2009/14/ppa2009295.pdf
PP Act: https://www.zppa.org.zm/documents/20182/21181/Public_Procurement_Act_2008.PDF/2e47ad9f-ac97-404c-ace4-252314880ff6

The PPP procuring authority will vary depending on the nature of the project. Under Section 2 pf the PPP Act, a public authority has the power to enter into an agreement for the implementation of an infrastructure project or infrastructure facility or the provision of any social sector services under any law, including any Ministry, Government department, local authority or statutory body. We can add in this context a reference to the Zambia Public Procurement Authority at: https://www.zppa.org.zm/home

Section 4 of the PPP Act provides for its primary implementing organ: the Public-Private Partnership Unit (the "PPP Unit"), part of the department of finance and under its supervision. Section 5 lists the roles of this Unit, one of its main duties being the responsibility of identifying projects which may be implemented under the auspices of the PPP Act.
The primary implementing organ under the PPP Act is the Public-Private Partnership Unit (the "PPP Unit"), provided for in Section 4 of the PPP Act. Among the PPP Unit's duties is the responsibility of identifying projects which may be implemented under the auspices of the PPP Act. The PPP Unit is housed in the Ministry of Finance and is under the control and supervision of the Minister of Finance. In addition to the PPP Unit other implementing organs under the PPP Act are the Public-Private Partnership Technical Committee (the "PPP Technical Committee") which evaluates projects for approval and the Public-Private Partnership Council (the "PPP Council") that is responsible for approving the implementation of projects under the Act.

Note: The Zambia Development Agency (ZDA) also plays a critical role in marketing and facilitating PPP projects between various key players and Contracting Authorities in Zambia.
The Zambia Development Agency website: http://www.zda.org.zm/?q=content/public-private-partnership-ppp-projects

According to Section 5 of the PPP Act: The functions of the PPP Unit are to: (a) promote the participation of the private sector in the financing, construction, maintenance and operation of any project irrespective of its cost;
(b) advise Government on administrative procedures in relation to project development and on all matters of policy relating to public-private partnerships;
(c) conceptualize, identify and categorize projects for purposes of this Act and prepare a project register as may be prescribed;
(d) co-ordinate with contracting authorities in respect of any project;
(e) develop technical and best practice guidelines in relation to all aspects of public-private partnerships, standardized bidding documents and public-private partnership agreement provisions for purposes of this Act and as may be prescribed;
(f) receive and make an assessment of any proposed project submitted to it and give its recommendations to the contracting authority as to whether the project or facility(i) is affordable to a contracting authority;
(ii) provides value for money; and
(iii) presents optimum transfer of technical, operational and financial risks to the concessionaire;
(g) examine the request for proposals to ensure conformity with the approved feasibility study and as may be prescribed;
(h) monitor the competitive selection process and provide for review of the process if so required, under this Act;
(i) monitor progress of implementation of public-private partnerships;
(j) facilitate the internal and external auditing of projects and prepare a road map for project development;
(k) in liaison with the Zambia Development Agency, facilitate and market investment in public-private partnerships;
(I) identify inter-sectoral linkages and facilitate approvals from the Ministry responsible for finance required under this Act;
(m) approve terms of reference for consultancy assignments for a project and the consultant selection process for such assignment in liaison with the Technical Committee;
(n) determine financial support and approve the allocation of contingent liability for any project, as prescribed by the Minister;
(o) monitor issues pertaining to user levies and recommend to the Council, in liaison with the appropriate regulatory agency, mechanisms and procedures for setting, revising and collecting user levies and the settlement of disputes relating to user levies, notwithstanding any other law to the contrary;
(p) train, and provide advisory services to, project officers; and
(q) promote public-private partnership awareness and advocacy in Zambia.
(2) The Unit shall be responsible for ensuring the proper implementation, management, enforcement and monitoring of any agreement and the reporting by a concessionaire on an agreement.
(3) The Unit shall exercise and perform such other powers and functions as are conferred or imposed on it by, or under, this Act or any other written law.

The PPP Unit (which is a department of the Ministry of Finance pursuant to section 4(2) of the PPP Act, is charged with, inter alia, assessing projects submitted to it by public authorities wishing to enter into a PPP. According to Section 19(1) of the PPP Act, when formulating a proposal for a PPP, the relevant public authority must take into account the advice of the PPP Unit (i.e. Ministry of Finance). However, ultimate approval of a project proposal lies with the Council pursuant to Section 19(2) of the PPP Act, which is not a part of the Ministry of Finance but is comprised of ministers and other persons appointed by the President and chaired by the Minister of Finance.

Section 38 (3) of the PPP Act provides that: A contracting authority shall not award any project or sign any agreement unless the- (a) award of the project has been approved by the Unit; and (b) agreement relating to the project has been approved by the Council.

The ultimate approval of a project proposal lies with the Council pursuant to Section 19(2) of the PPP Act, which is not a part of the Ministry of Finance but is comprised of ministers and other persons appointed by the President and chaired by the Minister of Finance. Additionally, under Section 7(1)(b) of the PPP Act, the functions of the council include approval of the projects.

(1) Section 19(2) of the PPP Act provides that: a contracting authority shall, after undertaking a feasibility study and in accordance with the advice of the Unit, submit a project proposal together with the proposed agreement to the Technical Committee for evaluation. The Technical Committee shall consider the project proposal and the proposed agreement submitted under subsection (1) and submit the feasibility study, the project proposal and the proposed agreement to the Council which shall- (a) accept the project proposal and agreement with or without amendments, within the prescribed time; (b) return the project proposal and agreement to the contracting authority for re-consideration and re submission for approval, within the prescribed time; or (c) reject the project proposal and agreement, within the prescribed time. If at any time, after the Council has approved a feasibility study for a project, any assumption in the feasibility study is materially revised, including any assumption concerning affordability, value for money and substantial technical, operational and financial risk transfer, the contracting authority shall immediately (a) provide the Technical Committee with details of the intended revision including a statement regarding the purpose and impact of the intended revision on the affordability, value for money and risk transfer evaluation contained in the feasibility study; and (b) ensure that the Technical Committee is provided with a revised feasibility study for submission to the Council for consideration in accordance with subsection (2).Finally, Section 7(1)(b) of the PPP Act provides that: (I) The functions of the Council are to-(b) approve projects for purposes of this Act

Section 38(3) of the PPP Act provides that: A contracting authority shall not award any project or sign any agreement unless the- (b) agreement relating to the project has been approved by the Council.

According to the vast majority of our contributors in Zambia, the procuring authority does not evaluate PPPs against existing government priorities

In practice, the socio-economic assessment is done in practice when identifying and preparing a PPP in Zambia, and the PPP Unit, the PPP Technical Committee and the PPP Council then look into such assessment as well

Section 5(1)(f) of the PPP Act provides that the functions of the PPP Unit include the responsibility to receive and make an assessment of any proposed project submitted to it and give its recommendations to the contracting authority as to whether the project or facility (i) is affordable to a contracting authority

The affordability assessment, including the identification of the required long term public commitments (explicit and implicit, direct and contingent liabilities) is always done in practice in Zambia when identifying and preparing a PPP

Sections 5(1)(f)(iii) of the PPP Act provides that: The functions of the Unit are to receive and make an assessment of any proposed project submitted to it and give its recommendations to the contracting authority as to whether the project or facility: ... (iii) presents optimum transfer of technical, operational and financial risks to the concessionaire. Furthermore, Section 18(d) of the PPP Act provides that The Minister may, by statutory instrument, make regulations to provide for-... any other matter to ensure that agreements provide value for money and afford the optimum transfer of appropriate technical, operational or financial risk to concessionaires.

The risk identification, allocation and assessment is always done in practice in Zambia when identifying and preparing a PPP

Sections 5(1)(f) of the PPP Act provides that: The functions of the Unit are to receive and make an assessment of any proposed project submitted to it and give its recommendations to the contracting authority as to whether the project or facility: (ii) provides value for money; ...

A comparative assessment to evaluate whether a PPP is the best option when compared to other procurement alternatives is always done in practice in Zambia when evaluating and preparing a PPP

Section 5 of the PP Law provides that (1) The functions of the Unit are to; … (n) determine financial support and approve the allocation of contingent liability for any project, as prescribed by the Minister;
Furthermore, Section 31 of the PP Law provides that (2) The criteria for evaluating financial and commercial proposals shall include, as appropriate: ...
(c) the costs for design and construction activities, annual operation and maintenance costs, present value of capital costs and operating and maintenance costs; ...
(e) the soundness of the proposed financial arrangements; ...

In practice, the financial viability or bankability assessment is always done in Zambia when evaluating and preparing a PPP

According to our contributors, the assessments that are included in the tender documents are the financial viability, the affordability and the risk assessments

Section 22(5)(c) of the PPP Act provides that the invitation to submit expressions of interest for participation in pre-selection proceedings shall include, where already known, a summary of the main required terms of the agreement to be entered into. In addition, when requesting technical proposals from pre-selected bidders a procuring authority must include proposed contractual terms, including an indication of which terms are considered to be non-negotiable (section 28(c) of the PPP Act).

Section 22 of the PPP Act provides that (4) The invitation for submission of expressions of interest shall be published in accordance with regulations issued under it.

Section 43 of the PPP Act provides that: "An agreement shall provide for such matters as the parties consider appropriate, but shall include: ...(c) the assistance that a contracting authority may provide to the concessionaire in obtaining licenses and permits to the extent necessary for the implementation of the project; ..."

Section 43 of the PPP Act provides that: "An agreement shall provide for such matters as the parties consider appropriate, but shall include: ...(c) the assistance that a contracting authority may provide to the concessionaire in obtaining licenses and permits to the extent necessary for the implementation of the project; ..."

Section 43 of the PPP Act provides that: "An agreement shall provide for such matters as the parties consider appropriate, but shall include: ...(c) the assistance that a contracting authority may provide to the concessionaire in obtaining licenses and permits to the extent necessary for the implementation of the project; ..."

According to Section 46 of the PPP Act, (1) A contracting authority or other public authority, under the terms of any relevant law and an agreement, shall make available to the concessionaire or, as appropriate, shall assist the concessionaire in obtaining such rights related to the project site, including title thereto, as may be necessary for the implementation of the project.
(2) Any compulsory acquisition of land that may be required for the implementation of a project shall be carried out in accordance with the Land Acquisition Act.

According to Article 47 of the PPP Act, "A contracting authority or other public authority, under the terms of any law and an agreement, shall make available to the concessionaire or, as appropriate, shall assist the concessionaire to enjoy the right to enter upon, transit through or do work or fix installations upon, property of third parties, as appropriate and required for the implementation of the project."

Section 10 of the PPP Act prescribes which holders of office should be appointed: It provides that the Public-Private Partnership Technical Committee shall consist of the following part-time members appointed by the Minister:(a) the Secretary to the Treasury, as Chairperson; (b) a representative of the Attorney-General; (c) the Permanent Secretary of the Ministry responsible for works and supply; (d) the Permanent Secretary of the Ministry responsible for industry; (e) the Permanent Secretary of the Ministry responsible for land; (f)that Permanent Secretary of the Ministry responsible for local government; (g) a representative of the Engineering Institution of Zambia; (h) a representative of the National Council for Construction; (i) a representative of the Environmental Council of Zambia; (j) a representative of the Zambia Public Procurement Authority; (k) a representative of the Economic Association of Zambia, nominated by that Association; and (I)two persons appointed by the Minister. (2) The Minister shall appoint the Vice-Chairperson from among the members.

Article 26 of the PP Act provides that: (5) Where a procuring authority uses an open international bidding- (a) a bid notice shall, in addition to the national media, be published in any regional or international media

Section 22(5)(d) of the PPP Act provides that: the manner and place for the submission of applications for pre-selection and the deadline for the submission, expressed as a specific date and time, allowing sufficient time for bidders to prepare and submit their expressions of interest

According to Section 25 of the PP Act, (under Part IV titled Methods of Procurement), (2) except as provided for in this Act, a procuring entity shall use open bidding for the procurement of all goods, works and non-consulting services

According to Section 29 of the PP Act, the objectives of the limited bidding is to obtain competition and value for money to the extent possible where the circumstances do not justify or permit the use of open bidding. (20 the limited bidding may be used where: (the works, goods or services are only available from a limited number of suppliers; or (b) there is an urgent need for the consulting services and engaging in open bidding would be impractical"

There is no explicit requirement under the PPP Act or the PP Act for tender documents to detail the stages of the procurement process.

Sections 22(6)(a) of the PPP Act provides that the pre-selection bidding documents shall include at least the following information: (a) the pre-selection criteria in accordance with section twenty-three; and Section 23 regulates the preselection criteria: Any person who meets the criteria stated in the pre selection bidding documents shall qualify for the pre selection proceedings which criteria shall include the following: (a) adequate professional and technical qualifications, human resources and equipment and other physical facilities as may be necessary to carry out all the phases of the project; and (b) appropriate managerial and organizational capability, reliability and experience, including previous experience in operating similar infrastructure facilities.

Section 27(3)(b) of the PPP Act provides that: the contracting authority may convene meetings and hold discussions with any of the bidders to clarify questions concerning the initial request for technical proposals or the initial technical proposals and accompanying documents submitted by the bidders which shall be recorded in minutes of the meeting or discussion. Furthermore, Section 30(1) provides that: A contracting authority may, whether on its own initiative or as a result of a request for clarification by a bidder, review and, as appropriate, revise any element of the request for technical proposals as set out in section twenty eight.

Section 27 of the PPP Act provides that (3) where a two stage procedure is used, ... (b) the contracting authority may convene meetings and hold discussions with any of the bidders to clarify questions concerning the initial request for technical proposals or the initial technical proposals and accompanying documents submitted by the bidders which shall be recorded in minutes of the meeting or discussion; ..."

Notwithstanding confidential information pertaining to the bidders, the procuring authority in Zambia discloses the content and the results of the pre-bid conference to all bidders in practice

Section 31 provides that the criteria for evaluating technical proposals shall include the following: (a) technical soundness; (b) compliance with environmental standards under any law; (c) operational feasibility; (d) quality of services and measures to ensure their continuity; and (e) any other prescribed criteria. (2) The criteria for evaluating financial and commercial proposals shall include, as appropriate: (a) the present value of proposed user levies, unit prices, and other charges over the agreement period; (b) the present value of proposed direct payments by the contracting authority, if any; (c) the costs for design and construction activities, annual operation and maintenance costs, present value of capital costs and operating and maintenance costs; (d) the extent of financial support, if any, expected from a public authority in Zambia; (e) the soundness of the proposed financial arrangements; (f) the extent of acceptance of the negotiable contractual terms proposed by the contracting authority in the request for technical proposals; (g) the social and economic development potential offered by the technical proposals; and (h) any other prescribed criteria.

Section 28 of the PPP Act provides that: To the extent not required by, or under, the Public Procurement Act, 2008, a request for technical proposals shall include the following: ... (d) criteria for evaluating technical proposals, and the thresholds, if any, set by the contracting authority for identifying non responsive proposals, the relative weight to be accorded to each evaluation criterion and the manner in which the criteria and thresholds are to be applied in the evaluation and rejection of proposals. Section 32 of the PPP Act provides that (1) A contracting authority shall evaluate each technical proposal in accordance with the evaluation criteria, the relative weight accorded to each such criterion and the evaluation process set out in the request for technical proposals. Additionally, Section 32 of the PPP Act provides that: (1) A contracting authority shall evaluate each technical proposal in accordance with the evaluation criteria, the relative weight accorded to each such criterion and the evaluation process set out in the request for technical proposals.

According to Section 38 of the PPP Act, the contracting authority shall cause a notice of the contract award to be published in the prescribed manner.

There are no provisions in the legal/regulatory framework in Zambia requiring the procuring authority to provide all the bidders with the result of the procurement process.

Section 34 of the PPP Act provides that a contracting authority shall rank all responsive technical proposals on the basis of the evaluation criteria and invite, for final negotiation of the agreement, the bidder that has attained the best rating, except that the final negotiations shall not include those contractual terms, if any, that were stated as non negotiable in the final request for technical proposals. (2) A contracting authority shall, where it becomes apparent to the contracting authority that the negotiations with the bidder invited will not result in an agreement, inform the bidder of its intention to terminate the negotiations and give the bidder reasonable time to formulate its best and final offer. (3) Where a bidder puts forward its best and final offer and the contracting authority does not find that offer acceptable, it shall terminate the negotiations with the bidder concerned. (4) Where a contracting authority terminates negotiations under subsection (3), the contracting authority shall invite the other bidders for negotiations, in the order of their ranking, until the parties conclude an agreement or the contracting party rejects all the remaining proposals. (5) A contracting authority shall not resume negotiations with a bidder with whom negotiations have been terminated in accordance with this section.

In practice, the restrictions on negotiations with the selected bidder between the award of the PPP contract and its signature are respected in Zambia

Section 62 of the PPP Act provides that a contracting authority shall be responsible for ensuring that the agreement is properly implemented, managed, enforced, monitored and reported on by the concessionaire

Section 57 of the PP Act provides that (1) A procuring entity shall appoint a contract manager for every contract awarded, who shall be responsible for-(a) managing the obligations of the procuring entity specified in the contract; and (b) ensuring that the supplier performs the contract in accordance with the terms and conditions specified in the contract.

According to Section 57 of the PP Act, (2) A contract manager shall be selected in accordance with the procedure prescribed by statutory instrument, taking into account the skills, experience and functions required for management of the contract.

According to Section 62 of the PPP Act, "A contracting authority shall be responsible for ensuring that the agreement is properly implemented, managed, enforced, monitored and reported on by the concessionaire".

Section 62 of the PPP Act provides that a contracting authority shall be responsible for ensuring that the agreement is properly implemented, managed, enforced, monitored and reported on by the concessionaire

Section 51 of the PPP Act provides that: (1) Except as otherwise provided in an agreement, a controlling interest in the concessionaire's company shall not be transferred to third parties without the consent of the appropriate contracting authority. (2) An agreement shall set forth the conditions under which the consent of a contracting authority shall be given.

According to Section 50 of the PPP Act, (1) Except as otherwise provided in section forty-nine, the rights and obligations of the concessionaire under an agreement may not be assigned to a third party without the prior written consent of the appropriate contracting authority.
(2) An agreement shall set out the conditions under which a contracting authority shall give its consent to an assignment of the rights and obligations of the concessionaire under the agreement, including the acceptance by the new concessionaire of all obligations there under and evidence of the new concessionaire's technical and financial capability as shall be necessary for providing the service or undertaking the project.

Section 54 of the PPP Act provides that: Without prejudice to section sixty three, an agreement shall set out the extent to which a concessionaire is entitled to a revision of the agreement with a view to providing compensation in the event that the cost of the concessionaire's performance of the agreement has substantially increased or that the value that the concessionaire receives for such performance has substantially diminished, as compared with the costs and the value of performance originally foreseen, as a result of- (a) changes in economic or financial conditions; or (b) changes in legislation or regulations not specifically applicable to the project or the services it provides: Provided that the economic, financial, legislative or regulatory changes- (i) occur after the conclusion of the agreement; (ii) are beyond the control of the concessionaire; and (iii) are of such a nature that the concessionaire could not reasonably be expected to have taken them into account at the time the agreement was negotiated or have avoided or overcome their consequences. (2) An agreement shall establish procedures for revising the terms of the agreement following the occurrence of any changes.

According to Section 54 of the PPP Act, (1) Without prejudice to section sixty three, an agreement shall set out the extent to which a concessionaire is entitled to a revision of the agreement with a view to providing compensation in the event that the cost of the concessionaire's performance of the agreement has substantially increased or that the value that the concessionaire receives for such performance has substantially diminished, as compared with the costs and the value of performance originally foreseen, as a result of— (a) changes in economic or financial conditions; or ...

According to Section 57 of the PPP Act, "The duration of a public private partnership shall be set forth in an agreement and the contracting authority may not agree to extend its duration except as a result of the following circumstances:
(a) delay in completion or interruption of operation due to circumstances beyond-the reasonable control of either party;
(b) project suspension brought about by acts of the Unit or a contracting authority or other public authority;
(c) increase in costs arising from requirements of the Unit or a contracting authority not originally foreseen in the agreement, if the concessionaire would not be able to recover such costs without such extension; or
(d) on agreement with the concessionaire, for reasons of national or public interest, as justified in the record to be kept by the Unit.

According to Section 54 of the PPP Act, (1) Without prejudice to section sixty three, an agreement shall set out the extent to which a concessionaire is entitled to a revision of the agreement with a view to providing compensation in the event that the cost of the concessionaire's performance of the agreement has substantially increased or that the value that the concessionaire receives for such performance has substantially diminished, as compared with the costs and the value of performance originally foreseen ...

Article 58. of the PPP Act provides that a contracting authority or the Unit may terminate an agreement (a) in the event that it can no longer be reasonably expected that the concessionaire will be able or willing to perform its obligations, owing to insolvency, material default or otherwise; or (b) for compelling reasons of national or public interest, subject to payment of compensation to the concessionaire as agreed in the agreement. Furthermore, Article 60 provides that either party has the right to terminate an agreement by mutual consent or if the performance of its obligations is rendered impossible by circumstances beyond either party's reasonable control

Section 53 of the PPP Act provides that: An agreement shall set out the extent to which a concessionaire is entitled to compensation in the event that the cost of the concessionaire's performance of the agreement has substantially increased or that the value that the concessionaire receives for such performance has substantially diminished, as compared with the costs and the value of performance originally foreseen, as a result of changes in legislation or regulations specifically applicable to the project or the services it provides. Additionally, Section 54 regulates, among others, the change in the law that may occur during the life of the PPP contract.

Section 64 of the PPP Act provides: Any disputes between the Unit or a contracting authority and the concessionaire shall be settled through the dispute settlement mechanisms agreed by the parties in the agreement or, failing such agreement, in accordance with the Arbitration Act, 2000

According to Section 64 of the PPP Act, "Any disputes between the Unit or a contracting authority and the concessionaire shall be settled through the dispute settlement mechanisms agreed by the parties in the agreement or, failing such agreement, in accordance with the Arbitration Act, 2000".

According to Article 27 of the Arbitration Act in Zambia, (1) A foreign award shall, subject to the provisions of this Part, be enforceable in the Court either by action or under the provisions of section sixteen of Part II. Effect of foreign awards
(2) Any foreign award which would be enforceable under this Part shall be treated as binding for all purposes on the persons as between whom it was made, and may accordingly be relied on by any of those persons by way of defence, set-off or otherwise in any legal proceedings, and any references in this Part to enforcing a foreign award shall be construed as including references to relying on an award.

Foreign arbitral awards are recognized and enforced in Zambia under the Arbitration Act, Section 27 of which provides for the recognition and enforcement of foreign arbitral awards. Zambia is party to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards of 1958, which entered into force on June 7, 1959, and party to the Convention of the Settlement of Investment Disputes between States and Nationals of Other States of 1965 and entered into force on October 14, 1966. These are being enforced through the Investment Dispute Convention Act Cap 42 of the Laws of Zambia. Finally, Zambia is a member state to the International Centre for the Settlement of Investment Disputes (ICSID Convention) and a signatory to the United Nations Commission of International trade Law (UNCITRAL Model Law).

Section 56(1) of the PPP Act provides that: The Unit may agree with any entity extending financing for a project and a concessionaire to provide for the substitution of the concessionaire with another person appointed to perform under the existing agreement, upon a material default by the concessionaire or other event that could otherwise justify the termination of the agreement.

Section 56(1) of the PPP Act provides that: The Unit may agree with any entity extending financing for a project and a concessionaire to provide for the substitution of the concessionaire with another person appointed to perform under the existing agreement, upon a material default by the concessionaire or other event that could otherwise justify the termination of the agreement.

insolvency, national or public interest, material default, financial unbalance, and failure to agree on a revision of the agreement (after the conditions of revision were met) Section 58 of the PPP Act provides that: A contracting authority or the Unit may terminate an agreement (a) in the event that it can no longer be reasonably expected that the concessionaire will be able or willing to perform its obligations, owing to insolvency, material default or otherwise; or (b) for compelling reasons of national or public interest, subject to payment of compensation to the concessionaire as agreed in the agreement. Furthermore, Section 59 provides that a concessionaire shall not terminate an agreement except under the following circumstances: (a) in the event of material default by the Unit or a contracting authority or other public authority of its obligations under the agreement; (b) if the conditions for a revision of the agreement are met but the parties have failed to agree on a revision of the agreement; or (c) if the cost of the concessionaire's performance of the agreement has substantially increased or the value that the concessionaire receives for such performance has substantially diminished as a result of acts or omissions of the Unit or a contracting authority or other public authority and the parties have failed to agree on a revision of the agreement.

Section 60 of the PPP Act provides that either party has the right to terminate an agreement by mutual consent or if the performance of its obligations is rendered impossible by circumstances beyond either party's reasonable control. Furthermore, Section 61 provides that an agreement shall stipulate how compensation due to either party shall be calculated in the event of termination of the agreement and shall provide, where appropriate, for compensation for the fair value of works performed under the agreement, costs incurred or losses sustained by either party, including, as appropriate, lost profits.

Section 42 of the PPP Act regulates the submission of unsolicited proposals. In fact, Section 42(1) provides that a contracting authority may receive, consider, evaluate and accept an unsolicited proposal for a public private partnership ...

Section 42 of the PPP Act provides that: (2) A contracting authority shall, within fourteen days after receiving an unsolicited proposal, undertake a preliminary evaluation of the unsolicited proposal to determine if the proposal complies with the requirements of subsection (1). the following subsections provide that if such proposals are not compliant with the requirements, the procuring authority should return it. I f it is compliant, then the procuring authority continues to evaluate the proposal in accordance with this section.

Section 42 of the PPP Act provides that: (1) A contracting authority may receive, consider, evaluate and accept an unsolicited proposal for a public private partnership if the proposal —
(a) is independently originated and developed by the proposer;
(b) shall be beneficial to the public;
(c) has been prepared without the supervision of the Unit or a contracting authority; and
(d) includes sufficient detail and information for a contracting authority to evaluate the proposal in an objective and timely manner.
(2) A contracting authority shall, within fourteen days after receiving an unsolicited proposal, undertake a preliminary evaluation of the unsolicited proposal to determine if the proposal complies with the requirements of subsection (1).
(3) A contracting authority or the Unit shall take appropriate action to protect confidential or proprietary information that a person provides as part of an unsolicited proposal.
(4) A contracting authority shall, where an unsolicited proposal does not comply with subsection (1), return the proposal without further action.
(5) A contracting authority may, if an unsolicited proposal complies with subsection (1), continue to evaluate the proposal in accordance with this section. ...

Section 42(6) of the PPP Act provides that a contracting authority shall, if an unsolicited proposal complies with subsection (1), advertise the unsolicited proposal for the purpose of receiving competitive proposals for the same project.

Section 42(8) of the PPP Act provides that: An advertisement, issued under subsection (6), shall specify a reasonable time period by which competitors shall submit a competing proposal to the contracting authority.

Section 42(12)(b) of the PPP Act provides: After evaluating an unsolicited proposal and any competing proposals, a contracting authority may - (b) request the originator of the proposal to match any competing proposal or make a best and final offer and if the originator of the proposal does so, the project shall be awarded to the originator of the proposal;