Considering the Constitution of the Republic of Burundi
In view of the Law of June 29, 1962 on the application of legislative and regulatory acts enacted by the tutelary authority
In view of the Law of September 21, 1963 on the General Tax Code;
In view of the Law n0 1/24 of September 10, 2008 relating to the Investment Code of Burundi;
In view of Law No. 1/35 of December 4, 2008 on the Organic Framework of Public Finance, as amended to date
Having regard to Law 110 1/23 of September 24, 2009 determining the Tax Advantages provided for by Law No 1/24 of September 10, 2008 on the Burundi Investment Code
In view of Law No. 1/06 of 25 March 2010 on the Legal Regime of Competition;
In view of Law No. 1/09 of May 30, 2011 on the Code of Private and Publicly Owned Companies
Having regard to Law No. 1/13 of August 09, 2011 on the Revision of the Land Code of Burundi, as amended to date
In view of Law No. 1/01 of February 9, 2012 revising Law No. 1/03 of February 19, 2009 on the Organization of the Privatization of Publicly Owned Enterprises, Services and Public Works
In view of Law No. 1/21 of 15 October 2013 on the Burundi Mining Code
In view of Law No. 1/02 of January 7, 2014 on the Insurance Code of Burundi
In view of Law No. 1/22 of July 25, 2014 on the Regulation of Recourse and
Direct Action of the State and the Communes against their agents and servants;
In view of Law No. 1/33 of November 28, 2014 on the Revision of Law If 1/02 of January 25, 2010 on the Organization of Communal Administration,
In view of Law No. 1/01 of January 16, 2015 revising Law No. 1/07 of April 26, 2010 on the Commercial Code;
The Council of Ministers having deliberated
The National Assembly and the Senate having adopted,
CHAPTER I: PURPOSE AND DEFINITIONS
Article 1: This law establishes the general rules of procedure applicable by the contracting authorities to the award, execution, monitoring and evaluation of public-private partnership contracts.
Article 2: For the purposes of this law, the following definitions shall apply
Contracting Authority(ies): the State, local authorities, public establishments or any other legal person under public law or private law acting on behalf of a legal person under public law, as well as legal persons benefiting from special or exclusive rights.
Co-contractor: a person under private law who is entrusted with all or part of the operations by a contracting authority.
Partnership contract: an administrative contract that governs the relationship between a contracting authority and a co-contractor and includes a sharing of risks related to the activities entrusted to the contractor as referred to in Article 37 point 2 of this law.
Competitive dialogue: a procedure whereby a partnership contract award committee engages in a dialogue with each of the candidates interested in participating in this procedure with a view to defining the technical, legal and financial means best suited to meeting the needs of the contracting authority and on the basis of which the selected candidates will be invited to submit their tenders.
Direct agreement: a method of awarding a public-private partnership contract whereby, after prior technical advice from the public-private partnership contract management structures and on the basis of a special authorization from the Council of Ministers, the Agency, in collaboration with the contracting authority, directly engages in discussions with the partner that appear useful, in accordance with the mandatory clauses provided for by the law governing the partnership contract regime.
Operations: a material or intellectual act or acts with a view to obtaining a result determined by the public-private partnership agreement.
Public-Private Partnership: a mode of contractual collaboration by which a contracting authority entrusts to the co-contractor under the terms of a partnership contract all or part of the activities referred to in Article 3 of this law.
Project company: a company under Burundian law set up after the selection of the private partner and before the negotiation and signing of the partnership contract.
Compelling urgency: a particularly serious situation resulting from an unforeseeable event external to the contracting authority which causes a delay prejudicial to the general interest fundamentally affecting the performance of a public service mission and which requires a diligent reaction on the part of the contracting authority.
CHAPTER II: THE PARTNERSHIP CONTRACT
Section 1: The nature of the partnership contract and the terms of remuneration of the co-contractor
Article 3: The partnership contract may relate in whole or in part to the design, financing, construction or transformation, operation, management, upkeep or maintenance of works, equipment or intangible assets necessary for the provision of a public service as well as other services contributing to the exercise, by the public person, of the public service mission for which it is responsible.
Article 4: The activities referred to in article 3 are entrusted to the co-contractor for a period determined according to the duration of amortization of the investments carried out for this one, of the services which are required of him as well as the methods of financing retained.
Article 5: The co-contractor can ensure the control of work to be carried out according to the type of contract of partnership concluded with the public person,
Article 6: The co-contractor can be transferred, subject to the possible agreement of the other parties concerned, all or part of the contracts concluded by the public person being able to contribute to the execution of its mission.
Article 7: The remuneration of the co-contractor is carried out according to one or more of the following methods
l) a payment linked to performance objectives and paid by the public authority throughout the duration of the partnership contract ;
2) a fee deducted directly by the co-contractor from the amounts collected from users or from the operating revenues of the facility or service for which it is responsible
3) a payment from the contracting authority of a fixed amount supplemented by a variable amount corresponding to a percentage of the operating revenue of the service or public work for which it is responsible.
Article 8: The remuneration of the co-contractor as described in Article 7 of this law may be supplemented, where appropriate, by related revenues from the development of the public domain or the alternative operation of the works or equipment covered by the partnership contract, provided that such activity is not contrary to the purpose of the partnership contract.
Section 2: The Agency for the Support of Public-Private Partnership Contracts
Article 9: An expert public service is hereby created, to be known as the Support Agency for the Implementation of Public-Private Partnership Contracts, under the administrative supervision of the Ministry having finance in its attributions. The powers of the Agency for the Support of Public-Private Partnership Contracts, its organization and operation shall be determined by decree.
Article 10: The Support Agency for the implementation of public-private partnership contracts shall intervene, jointly with the contracting authority, at all stages of a partnership contract, in particular during the preliminary evaluation of the public-private partnership project, the selection of co-contractors, the negotiation and monitoring of public-private partnership contracts.
Article 11: Any public-private partnership project must be subject to prior evaluation by the Agency for the Support of Partnership Contracts, which shall issue an opinion on its suitability.
The pursuit of any partnership project and in particular the initiation of a procedure for the selection of a co-contractor is conditional on obtaining a favourable opinion of opportunity from the Agence d’Appui à la Réalisation des contrats de partenariat public-privé.
The opinion of opportunity of the Agency of Support to the Realization of the contracts of public-private partnership must be motivated and include indications whose nature is fixed by regulatory act.
Section 3: Conditions for the use of partnership contracts
Article 12: Partnership contracts may be concluded only if the evaluation procedure conducted by the Agency for the Support of Partnership Contracts determines:
l) that, given the complexity of the project, the public entity is not objectively able to define alone and in advance the technical means that can meet its needs or to establish the financial or legal set-up of the project;
2) the economic, financial, legal and administrative reasons that led to the evaluation procedure after a comparative analysis, particularly in terms of overall cost, economic benefits, performance and risk-sharing between the contracting authority and the co-contractor, alternative options and environmental protection and sustainable development.
CHAPTER III: THE PROCEDURE FOR AWARDING PARTNERSHIP CONTRACTS
Section 1: Procedures for awarding partnership contracts
Article 13: Any award of a partnership contract shall give rise to the establishment, by the Partnership Contracts Support Agency, of an ad hoc committee composed of at least :
l) representatives of the contracting authority ;
2) representatives of the Support Agency for Public-Private Partnership Contracts;
3) a representative of the Ministry of Finance.
Article 14: Apart from the areas of exclusive competence of the Support Agency for the implementation of partnership contracts, the ad hoc committee is competent to
l) conduct the procedure for awarding the partnership contract;
2) selecting the co-contractor
3) negotiate the terms of the partnership contract with the co-contractor.
The ad hoc committee shall take its decisions by consensus and failing that by a two-thirds majority.
Article 15: A partnership contract may be signed by the contracting authority only after the agreement of the Minister in charge of finance. The Minister’s agreement shall be deemed to have been obtained in the absence of an express response within three months of the date on which the contract was sent to him.
Any draft partnership contract shall be submitted to the Council of Ministers for approval.
Article 16: The award of a partnership contract is subject to the principles of freedom of access to public procurement, equal treatment of candidates and transparency of procedures as laid down by this law.
Article 17: The award of a partnership contract shall be carried out according to one of the following procedures
1) open invitation to tender preceded by a pre-qualification procedure;
2) restricted invitation to tender
3) competitive dialogue;
4) direct agreement or direct agreement.
In the event of compelling urgency, it is not possible to comply with the competitive bidding deadlines in order to justify recourse to the direct agreement procedure to expedite the conclusion of a partnership agreement as motivated by the contracting authority. In this case, the establishment of a company under Burundian law is not a prerequisite for signing the contract.
The Support Agency for the Implementation of Partnership Contracts is alone empowered to decide, for each partnership project, which of the five above-mentioned procedures is applicable.
Article 18: As regards public-private partnership contracts, any open or restricted call for tenders shall be subject to the general regime referred to in the relevant provisions of this law.
However, the pre-qualification procedure is conducted by the ad hoc committee, which is the only one empowered to initiate the tender or call for applications procedure, to prepare the relevant files, to conduct, where appropriate, the pre-qualification phase, to analyze the tenders, to select the co-contractor and to submit the tender.
offers, to select the potential co-contractor and to negotiate and conclude the partnership contract with the latter.
Article 19: The contracting authority may terminate the bidding procedure at any time, without this decision being subject to any appeal by the bidders, unless this decision is taken after the award of the contract and before the partnership contract is signed.
In the latter case, the successful bidder may be entitled to a lump-sum financial compensation, provided that the principle and the amount of such compensation have been fixed in the invitation to tender.
Article 20: Natural or legal persons may not apply for the process of a public-private partnership contract:
l) who have not paid the duties, taxes, contributions, fees or levies of any kind whatsoever, or failing that, cannot justify by a document from the administration concerned that they have complied with their obligations in fiscal and social matters;
2) who have not made the declarations required by the laws and regulations in force;
3) which are in a state of judicial liquidation, judicial recovery or bankruptcy;
4) who are subject to any of the prohibitions or deadlines provided for by the legislation in force, in particular the penal code and the general tax code;
5) 5. who are affiliated with internal or external experts who have contributed to the preparation of all or part of the tender or consultation documents
6) who have financial or other interests of any kind that are incompatible with the quality of actors in the management of ppp contracts,
7) who have been convicted of an offence against the legislation on public-private partnership contracts;
Article 21: The ad hoc committee can have recourse to the competitive dialogue for the purposes of selecting the co-contractor if, taking into account the complexity of the partnership project, it is not able, alone and in advance, to define the technical means being able to answer its needs or to establish the financial or legal arrangement of the considered project.
Article 22 : The ad hoc committee can discuss with the candidates all aspects of the contract and each candidate is heard under equal conditions.
The ad hoc committee may not give certain candidates information that might give them an advantage over others, nor may it reveal to the other candidates proposed solutions or confidential information communicated by a candidate in the course of the discussion without the latter’s agreement.
Article 23 : The ad hoc committee shall continue discussions with the candidates until it is able to identify the solution or solutions likely to meet its needs, if any, after having compared them.
Article 24: The ad hoc committee may provide for the discussions to take place in successive phases, at the end of which only the proposals that best meet the criteria set out in the notice of call for tenders are retained.
The use of this possibility must have been indicated in the said notice.
Article 25: When the ad hoc committee considers that the discussion has come to an end, it informs the candidates who have taken part in all the phases of the consultation and invites them to submit their final tenders on the basis of the solution(s) presented and specified during the competitive dialogue within a time limit which may not be less than one month. The final offer must include all the elements necessary for the execution of the partnership contract.
Article 26: The ad hoc committee shall define the conditions for the execution of the public-private partnership contract and, where appropriate, specify the criteria for the award of the partnership contract defined in the notice of invitation to tender.
Article 27: The ad hoc committee may request clarifications, details, additions or improvements concerning the tenders submitted by the candidates as well as the confirmation of some of the commitments, particularly financial ones, which appear in them.
However, such requests may not have the effect of modifying the fundamental elements of the offer or the essential characteristics of the partnership contract, the variation of which is likely to distort competition or have a discriminatory effect.
Section 2: Selection of the co-contractor
Article 28: The selection of the co-contractor is carried out in the following manner:
1) prior publication of calls for applications or tender notices in accordance with the relevant provisions of this law
2) evaluation of the bids by the ad hoc committee and approval by the National Committee for Public-Private Partnership Contracts, in accordance with the criteria set out in the bidding documents or invitation to tender
3) the agreement of the Minister of Finance on the proposal to award the contract;
The selection process is sanctioned by the signing of the contract by the contracting authority, the Minister of Finance and the private partner after approval by the Council of Ministers.
Article 29: The award criteria shall relate mainly to the overall quality of the works, equipment or intangible assets, the cost of the bid, the performance objectives, availability or ability of the candidate to comply with the technical specifications defined in accordance with the purpose of the partnership contract and the proportion of the contract execution that the candidate undertakes to entrust to local companies and craftsmen as defined by the law on public-private partnership contracts.
The technical value and innovative nature of the bid, the time required to complete the works or equipment, and their aesthetic or functional quality may also be selected as award criteria in relation to the subject of the contract.
For buildings, the bids must include an architectural project.
Article 30: The partnership contract is awarded to the selected candidate on the basis of the quality/cost ratio by application of the technical, financial and legal criteria defined in the notice of call for applications or the notice of call for tenders and, where appropriate, specified in the competitive dialogue procedure provided for in Articles 21 to 25 of this Law.
Article 31: The remuneration of the co-contractor must, in the case of a public-private partnership contract, be one of the criteria for the award of the partnership contract.
Section 3: The project company
Article 32: The project operator must be established before the signing of the partnership contract, in the form of a company under Burundian law. The capital shall consist of contributions from national economic operators up to a minimum amount set by regulation.
Article 33: In case of absence of participation in the capital of the company under Burundian law by national economic operators, it is called upon any legal person of public law, the State, the Municipality and the public enterprise to participate in the capital with a minimum contribution by regulation.
Article 34: In case of imperative urgency, the project company under Burundian law is established during the execution of the project,
Article 35: The project company may only transfer the partnership contract to a third party with the prior agreement of the public authority that signed the contract after receiving the opinion of the Support Agency for Public-Private Partnership Contracts. The third party to whom the partnership contract is transferred must present sufficient technical, financial and legal guarantees and be capable of ensuring the continuity of the public service.
CHAPTER IV: MANDATORY CLAUSES OF THE PARTNERSHIP CONTRACT
Article 36: Every partnership contract must include clauses relating to:
1) its duration ;
2) the conditions under which the sharing of risks between the public entity and the co-contractor is established
3) the performance objectives assigned to the co-contractor or the specifications, norms and technical, economic, commercial and environmental standards with which the co-contractor is required to comply, in particular as regards the quality of the services provided, the quality of the works and equipment, the conditions under which they are made available to the public entity and, where appropriate, their level of use;
4) the identity of the project management team responsible for designing the works and monitoring their implementation when the partnership contract entrusts the co-contractor with all or part of the design;
5) the conditions of validity and entry into force of the contract
6) the procedures for obtaining the permits, licenses and authorizations necessary for the performance of the contract
7) the legal status of the co-contractor and, where applicable, the conditions for the establishment of the project company, signatory to the partnership contract
8) the remuneration of the co-contractor, the conditions under which the investment, operating and financing costs and, where appropriate, the revenue that the co-contractor may be authorized to obtain by exploiting the land, works, equipment or intangible assets in the context of activities that do not correspond to the public service missions of the public person and that do not prejudice them, the reasons for and the procedures for its variations during the term of the contract and the payment procedures, in particular the conditions under which :
– the sums due by the public entity to its co-contractor are paid each year ;
– the co-contractor pays a fee calculated on the basis of the operating revenue from the work or service provided;
– the remuneration of the co-contractor is calculated and deducted directly from the operating revenues;
– the sums for which the co-contractor is liable by way of penalties or sanctions are offset.
9) the terms and conditions of pricing and the pricing structure according to the type of partnership envisaged;
10) the obligations of the co-contractor designed to ensure that the works and equipment are assigned to the public service for which the contracting authority is responsible and that the requirements of the public service are met
11) the guarantees, commitments, sureties and other securities to be provided by the parties to the contract; the procedures for control and monitoring by the contracting authority of the performance of the contract, in particular compliance with performance objectives, obligations relating to technology transfer, training and employment of national labour, and the conditions under which the co-contractor calls on other companies to perform the contract and respects its commitment to award part of the contract to small and medium-sized enterprises and local craftsmen as referred to in Article 29, paragraph 1,
12) the obligation on the contracting party, when subcontractors are used for the construction of works and equipment, to provide a guarantee to ensure payment of their services as the work is carried out;
13) the provisions applicable in the event of failure by the co-contractor to meet its obligations, in particular failure to comply with performance targets or technical specifications;
14) the conditions under which the parties may negotiate an amendment to the contract according to a specific timetable or, failing agreement, one of the parties to the contract may modify certain aspects of the contract or terminate it, in particular to take account of changes in the needs of a public entity, technological innovations or changes in the financing conditions obtained by the co-contractor
15) the control that the public entity exercises over the partial or total assignment of the contract
16) the conditions under which the continuity of the public service is ensured in the event of default by the co-contractor, in particular when the contract is terminated
17) the procedures for transferring the works or equipment to the public entity at the end of the contract, where applicable
18) the obligation under the contract to take out insurance to cover the risks for which the other party is responsible
19) the conditions under which environmental and social impact studies are carried out and the procedures for protecting the environment and Burundi’s cultural heritage
20) the consequences of the termination, whether early or not, of the contract, particularly as regards the ownership of the works, equipment or intangible assets and, where appropriate, the compensation due
21) the modalities for the prevention and settlement of disputes and the conditions under which the parties may have recourse to arbitration.
Article 37: The stipulations of a public-private partnership contract may only be modified by means of an amendment. The amendment is adopted and notified according to the same examination procedure as a basic contract. It may not change the subject of the contract or the parties to the contract. The amendment is subject to prior technical advice from the PPP contract management structures.
The value of the amendment is fixed in percentage terms and may not exceed twenty percent (200/0) of the overall value of the public-private partnership contract.
CHAPTER V: LAND, PROPERTY AND TAX REGIME
Article 38: Land and property operations carried out within the framework of a partnership contract shall be subject to the laws and regulations in force.
Article 39: Where the partnership contract involves the occupation of the public domain, it shall be deemed to be an occupation authorization for its duration. The co-contractor shall have real rights over the works and equipment that it builds, unless otherwise stipulated in the partnership contract. These rights confer on it the prerogatives and obligations of the owner under the conditions and within the limits defined by the Partnership Contract.
Article 40: When the co-contractor is authorized to develop part of the public entity’s domain within the framework of the partnership contract, a delimitation of the property belonging to the public domain shall be carried out, if necessary.
Article 41: The contracting authority may authorize the co-contractor to grant leases under the conditions of private law, in particular construction leases or long leases, on property belonging to the private domain and to constitute all types of real rights for a limited period in accordance with the relevant provisions of the land code.
The agreement of the contracting authority must be expressly formulated for each lease or right granted to the co-contractor. The latter may be granted for a period exceeding that of the partnership contract with the agreement of the contracting authority.
Article 42: The public-private partnership contract shall specify the tax and customs regime applicable to it in accordance with the laws and regulations in force.
CHAPTER VI: MONITORING OF THE PARTNERSHIP CONTRACT
Article 43: An annual report drawn up by the co-contractor shall be sent to the contracting authority with a copy to the Agency for the Support of Partnership Contracts.
Article 44: Any partnership contract must be subject to a periodic audit by the Support Agency for the Implementation of Partnership Contracts.
The nature and methods of this audit shall be specified by decree.
Article 45: The public entity is entitled to impose administrative and financial penalties on the defaulting co-contractor, without prejudice to legal proceedings against the latter, if it is found, after notification of the contract or at any time during its performance, that
1) the co-contractor has concealed or manipulated the information that determined its selection;
2) the clauses of the partnership contract have not been complied with through its own fault.
CHAPTER VII: TRANSITIONAL AND FINAL PROVISIONS
Article 46: Contracts concluded before the date of promulgation of this law remain valid for their duration. They remain governed by the laws and regulations under which they were established. These contracts are subject to evaluation and monitoring by the Agency for the Support of Public-Private Partnership Contracts.
A report is transmitted to the Council of Ministers by the authorized bodies for assessment and decision.
Article 47: All previous provisions contrary to this law are repealed.
Article 48: This law shall enter into force on the day of its promulgation