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Czech Republic: new rules for PPP projects

Czech Republic
25/04/2006
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New rules for PPP projects involving construction works or infrastructure and other services are due to come info force on 1st July 2006.

PPP concession contracts involve:

  • the concessionaire agreeing to provide services and/or construction works
  • the public authority agreeing to let the concessionaire benefit from those services or works
  • the concessionaire bearing a substantial part of any risks involved in that benefit
  • the concessionaire being able to receive payments from the public authority

The concession procedure:

  • starts with pre-qualification of tender participants
  • the number of pre-qualified participants can be reduced to no fewer than three
  • solution for the project, and for the contract conditions can be found by using concession dialogue
  • after submission of bids the public authority will usually start negotiations with the bidders based on their bids
  • Government approval is needed to conclude significant concession contracts (where the total consideration exceeds €17 million)
  • contains new rules for using SPVs, granting subcontracts and approving concession documents

The first application of the new rules will be the transport projects that are already approved by the Government as PPP-pilot projects, including sections of D3 Motorway in the South Bohemia, and the Airport Connection in Prague.

Law: Act on Concessions No. 139/2006 Coll.

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