Law No. 2015-49 of November 27, 2015, on Public-Private Partnership Contracts

No. 96 Official Journal of the Tunisian Republic — December 1, 2015 Page 2855 laws Law No. 2015-49 of November 27, 2015, on Public-Private Partnership Contracts (1). In the name of the people, The Assembly of People's Representatives having adopted, The President of the Republic promulgates the law whose text follows: Chapter 1 General Provisions Art. 1 - This law aims to diversify the methods of fulfilling public procurement and its funding sources in order to develop and strengthen infrastructure, encourage public investment through partnership between the public and private sectors, and benefit from the professionalism and experience of the private sector. Art. 2 - This law establishes the general framework for public-private partnership contracts, their fundamental principles, their drafting and conclusion procedures, and determines the regime for their execution and control methods. Art. 3 - For the purposes of this law, the following terms are defined as follows: The public-private partnership contract: a written fixed-term contract by which a public entity entrusts a private partner with a comprehensive mission, wholly or partially covering the design and construction of tangible or intangible works, equipment, or infrastructure necessary to provide a public service. The partnership contract includes financing, construction or transformation, and maintenance, in exchange for remuneration paid by the public entity to the private partner during the contract term and in accordance with the conditions stipulated therein, hereinafter referred to as "partnership contract". The partnership contract does not include the delegation of public service management.

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(1) Preparatory work: Discussion and adoption by the Assembly of People's Representatives in its session of November 13, 2015. The public entity: The State, local authorities, as well as public establishments and companies that have obtained prior approval from the supervisory authority to conclude the partnership contract. The private partner: A private legal entity. The project company: A company incorporated as a joint-stock company or limited liability company in accordance with current legislation, whose corporate purpose is strictly limited to the execution of the partnership contract's object. Chapter 2 General Principles for Concluding Partnership Contracts Art. 4 - Projects subject to partnership contracts must address a need previously determined by the public entity and aligned with national and local priorities and objectives defined in development plans. Art. 5 - The drafting and conclusion of partnership contracts are governed by good governance rules and the principles of procedural transparency, equality and equal opportunity through competition, impartiality, and non-discrimination among candidates, in accordance with the provisions of this law. Art. 6 - Partnership contracts are subject to the principle of contractual balance through the sharing of risks between the public entity and the private partner within the contract. Chapter 3 Procedures and Methods for Awarding Partnership Contracts Art. 7 - The public entity must submit the project, to be implemented as a partnership contract, to an analysis of its various legal, economic, financial, social, and technical aspects; its environmental impacts; and the elements justifying its implementation under this form rather than other contractual forms.

The public entity must also prepare an impact assessment study on the implementation of the project as a partnership contract regarding the public budget, the financial situation of the public entity, and the availability of necessary funding. The study referred to in the first paragraph of this article must be submitted, accompanied by a project description sheet, to the General Public-Private Partnership Authority mentioned in Article 38 of this law for an opinion. The authority's opinion must be reasoned and binding. Upon approval by the authority, the impact assessment study referred to in the second paragraph of this article must be submitted to the Minister in charge of Finance for an opinion. The opinion must be reasoned. Art. 8 - Partnership contracts are awarded through competitive tendering. The partnership contracts may exceptionally be awarded through competitive dialogue or direct negotiation, in accordance with the conditions set forth in this law. Art. 9 - Given the specific nature of the partnership project, it is permissible to resort to competitive dialogue if it proves impossible for the public entity to predefine the technical and financial means and solutions that could meet its needs. In this case, the private partner is selected through competitive dialogue among candidates whose applications were retained following a call for tenders, and after negotiations regarding the legal, economic, financial, social, technical, administrative, and environmental structuring of the project, inviting them to submit final offers. Art. 10 - Partnership contracts are concluded through direct negotiation in any of the following cases: 1- For reasons of national defense or public security. 2- To ensure the continuity of public service in case of emergency for reasons not attributable to the public entity's will, resulting from unforeseeable circumstances. 3- If their object relates to an activity whose exploitation is exclusively reserved to the holder of an invention patent. Art. 11 - The private entity may submit a spontaneous offer to the public entity for the implementation of a project within the framework of a partnership contract and present a preliminary opportunity study for the project. The spontaneous offer must not concern a project currently being developed or executed by the public entity. The public entity may accept, reject, or modify the offer without incurring any liability toward its author, but must notify its decision within a period not exceeding ninety days, renewable once upon written notification by the public entity from the date of receipt of the offer. The public entity's silence within the deadlines set in the preceding paragraph is considered an implicit refusal. If the spontaneous offer is accepted, the public entity initiates the award procedures and methods set forth in this chapter, while informing the author of the spontaneous offer of the launch of the award procedures. A preference margin is granted to the author of the spontaneous offer during the competitive tendering phase. Art. 12 - Notwithstanding contrary legislative provisions and subject to the obligation of publicity and information of candidates and bidders applicable to the partnership contract, public officials are prohibited from disclosing information communicated by the private entity in confidence within the framework of the partnership contract. Confidentiality includes technical and commercial matters and aspects stated confidentially in the offers. Any violation of the provisions of the first paragraph of this article exposes the offender to disciplinary and criminal sanctions in accordance with current legislation. Art. 13 - The partnership contract is awarded to the candidate presenting the economically most advantageous offer.

The economically most advantageous offer is understood as the offer whose advantage is established based on criteria essentially covering quality, performance efficiency, overall project value, added value, the employment rate of Tunisian labor and its management ratio, the utilization rate of national products, and the offer's response to sustainable development requirements. The tender dossier must predefine the criteria for determining the economically most advantageous offer, based notably on a merit order according to a ratio assigned to each criterion based on its importance. Art. 14 - The tender notice must specify the minimum percentage of activities covered by the partnership contract that the private partner is required to subcontract to Tunisian small and medium-sized enterprises. The percentage proposed by each candidate is taken into consideration during the evaluation of the economically most advantageous offer. Art. 15 - The implementation modalities of Articles 7 to 14 of this law are fixed by governmental decree. Art. 16 - The public entity must publish the decision awarding the partnership contract on its website and in the locations allocated for central and regional administrative posters related thereto, for a duration of 8 days from the date of publication. Any participant in the tender with a legitimate interest may appeal the decree to the competent jurisdiction in accordance with summary proceedings procedures. Chapter 4 Conclusion and Execution of the Partnership Contract Art. 17 - The partnership contract is concluded between the public entity and the project company for a fixed term, taking into account notably the amortization period of the investments to be made and the financing methods adopted. The partnership contract is not renewable. Exceptionally, the contract may be extended for a maximum duration of three years in cases of emergency to ensure public service continuity, in cases of force majeure, or upon the occurrence of unforeseeable events, following the conform opinion of the General Public-Private Partnership Authority mentioned in Article 38 of this law. Art. 18 - The mandatory mentions of the partnership contract are fixed by governmental decree. Art. 19 - The partnership contract is submitted to the General Public-Private Partnership Authority for a conform opinion prior to its signature, within a period not exceeding one month from the date of its submission. The public entity must transmit a certified copy of the partnership contract after its signature to the General Public-Private Partnership Authority. Art. 20 - The public entity may participate in the capital of the project company with a minimum percentage; in this case, it is obligatorily represented in the management and deliberation structures of the project company, regardless of the participation percentage. Art. 21 - The private partner's participations in the capital of the project company may only be transferred after obtaining the prior written consent of the public entity, in accordance with the conditions and procedures fixed by the partnership contract. Art. 22 - The project company is required to execute the contract directly and subcontract a portion of its obligations, if the contract permits, after obtaining the prior consent of the public entity. However, the project company may in no case subcontract the entirety or the majority of the obligations owed to it under the contract. In all cases, the project company remains directly liable to the public entity and third parties for the fulfillment of all obligations imposed by the contract. Art. 23 - The remuneration paid by the public entity to the project company consists notably of all amounts corresponding to the costs of investments, financing, and maintenance, fixed separately. The contract must indicate the calculation and revision methods for the remuneration. Notwithstanding the provisions of Article 39 of the Public Accounting Code, when calculating the remuneration paid by the public entity, all amounts owed to it are deducted against the authorization granted as an ancillary right to the project company to exploit certain services or works related to the project.

The remuneration is paid by the public entity throughout the contract term from the date of final acceptance of the works, equipment, or constructions subject to the partnership contract. The payment of the maintenance fee is strictly conditional upon the achievement of the performance objectives assigned to the project company and the availability of the works and equipment in accordance with the contract conditions. Art. 24 - Unless otherwise stipulated, a specific real right is established in favor of the project company over the constructions, works, and fixed installations it realizes in execution of the partnership contract. This real right confers upon the project company during the contract term the rights and obligations of an owner within the limits set by this law. The constructions, works, and fixed installations subject to the partnership contract may only be mortgaged to secure loans contracted by the private partner to finance their construction, modification, extension, maintenance, or renovation, after prior notification to the public entity. The effects of mortgages encumbering the constructions, works, and fixed installations cease upon expiration of the partnership contract term. It is prohibited, throughout the entire contract duration, to transfer or assign in any manner the real rights encumbering the constructions, works, and fixed installations, including securities attached thereto, without the prior written authorization of the public entity. Unsecured creditors other than those whose claims arose from the execution of the works mentioned in the first paragraph of this article may not take conservatory or enforcement measures regarding the rights and assets mentioned in this article. The rights encumbering the constructions, works, and fixed installations subject to the partnership contract are registered in a special registry maintained by the competent services at the ministry in charge of State domains and land affairs. The procedures for maintaining this registry are fixed by governmental decree. The procedures and modalities provided by current legislation regarding real rights are applicable to the registration of the real right as well as the rights of creditors encumbering it. Art. 25 - When the contract entails occupation of the public domain, it serves as authorization to occupy said domain for its duration. The mode of occupation, the obligations attached thereto, and the rights arising therefrom are governed by the stipulations of the partnership contract and in accordance with current legislation. Art. 26 - The provisions of legislation governing landlord-tenant relations regarding the renewal of leases for buildings and premises intended for industrial and commercial use are not applicable to partnership contracts. Art. 27 - The partnership contract does not exempt the parties from obtaining all necessary authorizations or complying with specifications required for its execution under current legislation. Art. 28 - The partnership contract may not be assigned to third parties during its execution except after obtaining the prior written consent of the public entity and in accordance with contractual conditions. The third-party assignee of the contract must provide all necessary legal, financial, and technical guarantees proving its capacity and aptitude to continue the contract's execution. Art. 29 - Taking into account the conditions and procedures provided by legislation concerning the assignment or pledge of professional claims, the remuneration for investment and financing costs received by the project company may be assigned or pledged in favor of credit institutions that financed the project. The conditions and implementation modalities of this article are fixed by governmental decree. Art. 30 - In the event of a dispute arising from contract execution, amicable settlement of the dispute and the maximum duration allocated for this phase must be mentioned first, before resorting, if necessary and upon failure of conciliation efforts, to justice or arbitration. In case of recourse to arbitration, the contract must obligatorily stipulate that Tunisian law applies to the dispute.

Chapter 5 Control of the Execution of Partnership Contracts Art. 31 -The project company is required to periodically communicate to the public entity all legal, accounting, financial, and technical documents specific to the project in accordance with the partnership contract stipulations, as well as technical studies, plans, and standards required by the public entity. The project company must also submit to the public entity an annual report determining the project's progress status and the project company's compliance with its commitments. The project company must facilitate the tasks of the control agents indicated in Article 32 of this law. Art. 32 - In addition to control operations that may be mentioned in the partnership contract, the public entity is required to perform the following operations: -the monitoring of the project company's compliance with its commitments, notably the submission of the reports indicated in Article 31 of this law,

• the study and verification of the validity of documents communicated by the project company,
• conduct on-site inspections of works to verify their progress status and compliance with performance objectives and technical conditions mentioned in the contract, -the control of the project company's compliance with contractual conditions regarding subcontracting to national small and medium-sized enterprises, employment of national labor, and use of national products. A related report must be submitted to the National Public-Private Partnership Authority.
• the designation, if necessary, of one or more independent specialist experts to control contract execution,
• the submission of an annual report and, if necessary, other reports to the National Public-Private Partnership Authority regarding the progress of partnership contract execution and the project company's compliance with its commitments,
• the taking of measures provided by this law, in accordance with the provisions of Chapter Six, and by the partnership contract against the project company in case of obstruction to control operations or failure to meet its commitments, as applicable, under this law or the partnership contract. Art. 33 - Partnership contracts are periodically subject to evaluation and control by the Court of Audit, as well as control by the State's general control bodies, control bodies under the public entity, and audit by the National Public-Private Partnership Authority. The control and audit reports indicated are published in accordance with current legislation. The Government submits to the Assembly of People's Representatives an annual report on the execution of public-private partnership projects. Chapter 6 Termination of Partnership Contracts Art. 34 - The normal termination of the partnership contract occurs at its agreed term and exceptionally in the cases provided for in Articles 35 and 36 of this law. Art. 35 - The partnership contract may be terminated before the agreed deadline, either by mutual agreement of both parties or in the cases provided for by the partnership contract. The public entity may unilaterally terminate the contract if the private partner has committed a serious fault or for reasons of general interest. The partnership contract must specify the cases and procedures for termination and the applicable compensations. Art. 36 - The project company may be deprived of its rights by the public entity in case of failure to meet its contractual obligations, after being warned and granted the deadline fixed by the contract to fulfill its obligations. The contract specifies the cases of failure leading to deprivation and the conditions for continuing its execution and guaranteeing the continuity of public service.

In case of deprivation of rights, creditors whose claims are registered in the registry mentioned in Article 24 of this law are informed by registered letter with acknowledgment of receipt within a deadline fixed by the contract before the date of the deprivation decision, to allow them to propose the subrogation of another person to the deprived project company. The transfer of the partnership contract to the proposed person is subject to the prior consent of the public entity. Partnership contracts for projects realized or under realization have priority for payment compared to new projects programmed by the public partner. CHAPTER 7 Institutional Framework for Partnership Contracts Art. 37 - A Strategic Public-Private Partnership Council is created within the Presidency of the Government, responsible notably for establishing national strategies in the field of public-private partnership and setting priorities in accordance with development plan orientations. The composition and prerogatives of the council are fixed by governmental decree. Art. 38 - A General Public-Private Partnership Authority is created within the Presidency of the Government, responsible, in addition to the tasks provided in this law, for providing technical support to public entities and assisting them in the preparation, conclusion, and monitoring of the execution of public-private partnership contracts. The prerogatives and organization of the authority are fixed by governmental decree. In the framework of its missions, the authority may be assisted by experts or expert bureaus according to the principles of transparency, the