PPP/PFI

Public-private partnership (PPP/PFI) constitutes one of the principal models for the implementation of public infrastructure projects. It enables public authorities to mobilise funds from private investors to carry out infrastructure projects. In a standard PPP project, a public authority selects a private partner in a public tender (usually in a competitive dialogue) to construct or renovate a specific infrastructure asset (e.g. hospital, prison or school) and subsequently, to operate or maintain it for an agreed period of time (on average between 10 to 30 years depending on the project). A private partner is also obliged to provide equity and debt financing for the capital expenditure (such debt financing is usually based on a project finance model. Private partner receives an availability fee that is periodically paid by a public authority starting from the completion of the construction phase. Such availability fee should directly depend on the availability of the constructed or renovated asset and other qualitative and quantitative criteria of services provided by a private partner.

A broad definition of PPP also includes concession-based projects where remuneration of a private partner comes from end-users of a specific infrastructure asset (e.g. motorway tolls or parking fees). In this model, revenue risk is transferred to a private partner.

In respect of the PPP model, our lawyers have vast experience as in-house banking counsel as well as external legal advisors acting for financial institutions and public authorities. Selected projects carried out in Poland in relation to which our lawyers have advised include:

  • a PPP project consisting in the renovation and maintenance of student accommodation for the Jagiellonian University Collegium Medicum – the first project of this type successfully completed in Poland
  • a PPP project consisting in the construction, operation and maintenance of a waste incineration facility in Poland
  • a concession project consisting in the construction and operation of a car park in Wrocław
  • a motorway concession project consisting in the construction and maintenance of the A2 motorway (Nowy Tomyśl – Świecko)
 
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