PPP Project Proposed by Investors and Important Considerations

PPP Project Proposed by Investors and Key Aspects to Note (illustrative image)

According to the Public-Private Partnership Investment Law 2020, articles 25 and 26 stipulate that a PPP project proposed by investors must meet the following conditions for PPP projects and the sequence for preparing a PPP project:

- Investors proposing this PPP project must meet the following conditions:- Comply with the project selection conditions for PPP investment as specified in points a, b, c, and d, clause 1, Article 14 of this Law;- Not overlap with PPP projects organized by competent authorities for pre-feasibility study reports or approved for pre-feasibility study reports by other investors;- Align with national socio-economic development strategies, plans, and relevant planning as regulated by law.

Note: Projects proposed by investors must undergo open bidding or competitive negotiations as per Article 37 or Article 38 of this Law.

The sequence for preparing a PPP project must follow these steps:

- First, the process for preparing project proposal documents includes:- The investor sends a proposal letter for the PPP project to the competent authority; if the competent authority cannot be identified, it should be sent to the state management body for PPP investment;- The competent authority reviews and replies in writing, either approving or disapproving the investor’s pre-feasibility study report. The approval letter includes methods for cooperation with organizations and units under the competent authority, deadlines for submitting the investor’s project proposal, and other related contents; disapproved cases must clearly state the reasons;- If approved by the competent authority, the investor prepares the project proposal documents, including the pre-feasibility study report, legal status documents, capability, and experience of the investor;- The investor sends the project proposal documents to the competent authority;- If the project proposal documents are not approved, the investor bears all costs and risks.

- Second, the process for preparing, appraising the feasibility study report, and approving the project includes:- The investor prepares the feasibility study report according to Article 19 of this Law;- The feasibility study report prepared by the investor is appraised as per Article 20 of this Law;- The project is approved according to Articles 21, 22, and 23 of this Law;- If the project is not approved, the investor bears all costs and risks.

- Third, the project disclosure sequence is executed in one of two scenarios:- After the project proposed by the investor is authorized with an investment decision and approved, the competent authority discloses project information as regulated in Article 25 of this Law and includes the name of the proposing investor;- For projects involving intellectual property rights, trade secrets, technology, or confidential fundraising agreements necessary for project implementation, the investor negotiates with the competent authority on non-disclosure information content.

- Fourth, the process for adjusting the investment policy of PPP projects follows the regulations in Article 18 of this Law; adjustments to PPP projects follow the regulations in Article 24 of this Law.

- Additionally, report preparation costs are regulated as follows: Pre-feasibility and feasibility study report preparation costs are included in the total project investment amount. If the proposing investor is not selected, the cost of preparing pre-feasibility and feasibility study reports is reimbursed by the selected investor.

Note: Projects are appraised and given investment guidelines based on regulations in Articles 6, 12, 13, 14, 15, 16, and 17 of this Law proposed by investors.

More details can be found in Public-Private Partnership Investment Law 2020, effective from January 01, 2021.

Thanh Thao

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