On 23 November 2016, the President of Romania enacted Law 233/2016, with the main purpose of implementing a legislative framework capable of ensuring efficient cooperation between the public and the private sector regarding public investments. The object of the public-private partnerships is to create, rehabilitate or extend goods intended to provide a public service.
1. The scope of the act
The provisions apply to implementation projects for which the substantiation report establishes that the expected project company revenue is to be generated by payments from the public partner or from some other public institution to the benefit of the public partner.
Public-private contracts can be concluded for one of the main relevant activities in the public utility segment, as indicated in Law no. 99/2016 and Law no. 51/2006.
2. Forms of public-private partnership
Public-private partnerships can be:
Public-private partnership projects can be financed:
The private partner is able to ensure the financing of the project either from own or third-party resources.
Public partners can contribute financing in one of the following ways:
The private partner or the project company are entitled to provide guarantees regarding the legal rights they have from the public-private partnership only for the project financers and for as long as the partnership lasts.
Private partners can also settle guarantees regarding the shares owned by the project company, only on behalf of project financers which are either a credit institution or a financial institution.
5. Steps for concluding public-private partnerships
The following are required to conclude such a contract:
6. The nature of the contract
A legally-concluded public-private contract is an administrative contract and the provisions of Law no. 101/2016 apply in full.
The entire duration of the contract is established according to the amortisation period of the investments to be made by the project company.
7. Modifying the contract
The contract can be modified or unilaterally terminated only by the public partner if the public interest demands so in compliance with the following conditions:
8. Replacement of the private partner
If the private partner or the project company does not fulfil their tasks, the public partner has the right to replace the other party, if this possibility is stipulated in the contract.
9. Dispute settlement
The competence to solve any disputes arising from public-private partnerships is established by Law no. 101/2016.
[Source: The new law on public-private partnership as adopted by the Chamber of Deputies on 11 July 2016 and enacted by the President of Romania on 23 November 2016]
For a more detailed discussion of the impact that these provisions can play in your specific case, you can contact the following persons: