ARTICLES
Public Private Partnerships (PPPs) & The Greek Legislative Approach
Among them, one could include pure economic benefits, as the public sector is able to proceed with a greater number of infrastructure projects, even at times when public funding may be significantly constrained and, especially, the better allocation of risks, which is a core element of every PPP project, to the party (public or private) most efficient to manage it at the least possible cost. On the other hand, however, the implementation of PPPs entails some significant risks, as the inappropriate design and structure of PPPs may ultimately result in poor performance. Also, due to the fact that PPPs typically involve projects of a relatively high budget, it is essential that procurement is efficiently managed within well-defined and legitimate procedures which minimize the risk of legal challenges from the losing bidders and that there is a guarantee that public bureaucratic delays and deficiencies will not jeopardize the implementation of the whole scheme within its estimated timeframe and/or cost.
In Greece, a number of PPPs have already been implemented since early 90’s as a form of procurement for projects mainly in the public transport sector (including the new Athens International Airport and the Athens Ring Road). However, all such PPPs projects undertaken till 2005 needed to be implemented only after their parliamentary ratification, due to the lack of a general and coherent PPP legislative framework. The Greek Government elected in March 2004 had declared its intention to establish a comprehensive legal and economic framework that would ease the way for the implementation of PPPs. Given Greece’s post-Olympics budget constraints, the importance of introducing private finance into the provision of public-sector infrastructure and services had been increased even further. Those intense and pressuring needs led eventually to the adoption of the relatively recent Law no. 3389/2005.
The new legislation attempts to set a comprehensive procedure regarding the planning, approval, award and implementation phases of the whole range of PPPs by clearly defining the scope and minimum requirements of such projects. Its ultimate aim is to ensure the attainment of the most efficient outcome by supporting the positive aspects of the whole scheme on one hand and by minimizing the possibilities for occurrence of potential risks on the other.
Regarding the role of the legislation on enhancing and promoting the beneficial attributes of PPP projects, it is important that the Law gives a clear definition of the term “Public Private Partnership”, in the sense that it is explicitly defined firstly, which public entities are entitled to proceed to such partnerships with the private sector; secondly, that the partners from the private sector are eligible to participate in PPP projects only through special-purpose-vehicles (SPVs), i.e. limited companies established exactly for the purpose of implementing a public private partnership; thirdly, that PPPs may be related to the provision of both services and infrastructure; and fourthly, that, as a negative precondition, areas of competence which