UNCITRALModel Legislative Provisions

on Privately Financed

Infrastructure Projects

Prepared by the United NationsCommission on International Trade Law

UNITED NATIONS

Printed in AustriaV.03-90621May 20043,870

United Nations publicationSales No. E.04.V.11ISBN 92-1-133583-3

UNCITRALUNCITRALUNCITRALUNCITRALUNCITRALModel Legislative Provisions

on Privately Financed

Infrastructure Projects

Prepared by the United NationsCommission on International Trade Law

UNITED NATIONSNew York, 2004

ii

NOTE

Symbols of United Nations documents are composed of capital letterscombined with figures. Mention of such a symbol indicates a reference to aUnited Nations document.

Material in this publication may be freely quoted or reprinted, butacknowledgement is requested, together with a copy of the publication contain-ing the quotation or reprint.

UNITED NATIONS PUBLICATIONSales No. E.04.V.11

ISBN 92-1-133583-3

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Preface

The present Model Legislative Provisions were prepared by the United NationsCommission on International Trade Law (UNCITRAL) as an addition to the UNCITRALLegislative Guide on Privately Financed Infrastructure Projects.a In addition to representa-tives of member States of the Commission, representatives of many other States and of anumber of international organizations, both intergovernmental and non-governmental,participated actively in the preparatory work.

The Commission considered the additional work to be undertaken in the field ofprivately financed infrastructure projects after the adoption of the Legislative Guide in 2001and entrusted a working group with the task of preparing model legislative provisions onthe basis of the recommendations contained in the Legislative Guide.b The workinggroup devoted two sessions, held in Vienna from 24 to 28 September 2001 and from 9 to13 September 2002 to the preparation of the draft model legislative provisions. The Com-mission finalized and adoptedc the Model Legislative Provisions at its thirty-sixth session,held in Vienna from 30 June to 11 July 2003, and requested the Secretariat to disseminatethem among Governments, relevant international intergovernmental and non-governmentalorganizations, private sector entities and academic institutions.

The Commission further requested the Secretariat to consolidate in due course the textof the Model Legislative Provisions and the Legislative Guide into one single publicationand, in doing so, to retain the legislative recommendations contained in the LegislativeGuide as a basis of the development of the Model Legislative Provisions.d

aUnited Nations publication, Sales No. E.01.V.4.bOfficial Records of the General Assembly, Fifty-sixth Session, Supplement No. 17 (A/56/17),

para. 369 (see Yearbook of the United Nations Commission on International Trade Law 2001,part one).

cIbid., Fifty-eighth Session, Supplement No. 17 (A/58/17), paras. 12-171.dIbid., para. 171.

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Contents

Page

Preface . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . iii

Resolution adopted by the General Assembly . . . . . . . . . . . . . . . . . . . . ix

Foreword . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xi

Part one

LEGISLATIVE RECOMMENDATIONS

I. GENERAL LEGISLATIVE AND INSTITUTIONALFRAMEWORK . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

Constitutional, legislative and institutional framework(recommendation 1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1Scope of authority to award concessions (recommendations 2-5) . 1Administrative coordination (recommendation 6) . . . . . . . . . . . . . 2Authority to regulate infrastructure services(recommendations 7-11) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

II. PROJECT RISKS AND GOVERNMENT SUPPORT . . . . . . . . . 3

Project risks and risk allocation (recommendation 12) . . . . . . . . 3Government support (recommendation 13) . . . . . . . . . . . . . . . . . . 3

Part two

MODEL LEGISLATIVE PROVISIONS

I. GENERAL PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Model provision 1. Preamble . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5Model provision 2. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . 5Model provision 3. Authority to enter into concession contracts 6Model provision 4. Eligible infrastructure sectors . . . . . . . . . . . . 7

II. SELECTION OF THE CONCESSIONAIRE . . . . . . . . . . . . . . . . . 7

Model provision 5. Rules governing the selection proceedings . 71. Pre-selection of bidders . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

Model provision 6. Purpose and procedure of pre-selection . . . . 7Model provision 7. Pre-selection criteria . . . . . . . . . . . . . . . . . . . 9

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Model provision 8. Participation of consortia . . . . . . . . . . . . . . 9Model provision 9. Decision on pre-selection . . . . . . . . . . . . . . 10

2. Procedures for requesting proposals . . . . . . . . . . . . . . . . . . 11

Model provision 10. Single-stage and two-stage procedures forrequesting proposals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11Model provision 11. Content of the request for proposals . . . . . 12Model provision 12. Bid securities . . . . . . . . . . . . . . . . . . . . . . . . 12Model provision 13. Clarifications and modifications . . . . . . . . . 13Model provision 14. Evaluation criteria . . . . . . . . . . . . . . . . . . . . 13Model provision 15. Comparison and evaluation of proposals . . 14Model provision 16. Further demonstration of fulfilment ofqualification criteria . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14Model provision 17. Final negotiations . . . . . . . . . . . . . . . . . . . . . 15

3. Negotiation of concession contracts without competitiveprocedures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

Model provision 18. Circumstances authorizing award withoutcompetitive procedures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15Model provision 19. Procedures for negotiation of a concessioncontract . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

4. Unsolicited proposals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

Model provision 20. Admissibility of unsolicited proposals . . . . 17Model provision 21. Procedures for determining the admissibilityof unsolicited proposals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17Model provision 22. Unsolicited proposals that do not involveintellectual property, trade secrets or other exclusive rights . . . . 18Model provision 23. Unsolicited proposals involving intellectualproperty, trade secrets or other exclusive rights . . . . . . . . . . . . . . 19

5. Miscellaneous provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

Model provision 24. Confidentiality . . . . . . . . . . . . . . . . . . . . . . . 19Model provision 25. Notice of contract award . . . . . . . . . . . . . . . 20Model provision 26. Record of selection and award proceedings 20Model provision 27. Review procedures . . . . . . . . . . . . . . . . . . . . 20

III. CONTENTS AND IMPLEMENTATION OF THECONCESSION CONTRACT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21Model provision 28. Contents and implementation of theconcession contract . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21Model provision 29. Governing law . . . . . . . . . . . . . . . . . . . . . . . 22Model provision 30. Organization of the concessionaire . . . . . . . 23Model provision 31. Ownership of assets . . . . . . . . . . . . . . . . . . . 23Model provision 32. Acquisition of rights related to theproject site . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

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Model provision 33. Easements . . . . . . . . . . . . . . . . . . . . . . . . . . . 24Model provision 34. Financial arrangements . . . . . . . . . . . . . . . . 25Model provision 35. Security interests . . . . . . . . . . . . . . . . . . . . . 25Model provision 36. Assignment of the concession contract . . . 26Model provision 37. Transfer of controlling interest in theconcessionaire . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26Model provision 38. Operation of infrastructure . . . . . . . . . . . . . 26Model provision 39. Compensation for specific changes inlegislation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27Model provision 40. Revision of the concession contract . . . . . . 27Model provision 41. Takeover of an infrastructure project bythe contracting authority . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28Model provision 42. Substitution of the concessionaire . . . . . . . 28

IV. DURATION, EXTENSION AND TERMINATION OF THECONCESSION CONTRACT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28

1. Duration and extension of the concession contract . . . . . . 28

Model provision 43. Duration and extension of the concessioncontract . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28

2. Termination of the concession contract . . . . . . . . . . . . . . . 29

Model provision 44. Termination of the concession contract bythe contracting au