| China has seen an unprecedented development in the provision of public service through public private partnerships in recent years in light of the momentum of the government's emphasis on urbanization and the new role of market mechanism in allocating resources in public service provision assigned by the ruling party's new philosophy.Against this tide of PPPs,the importance of proactive rules governing the new long term relationship is well recognized and competent authorizes have been issuing new administrative rules in this regards.However,it is also recognized that the current regulatory framework does not provide sufficient legal certainty for PPPs and sound legal basis for value for money.In light of the international experience,it is a critical regulatory issue that public procurement laws can accommodate the main and special features of PPPs.It can be argued that public procurement law generally aims at the regulation of conventional procurement and with the development of PPPs;the issues of law reform of conventional procurement law to accommodate the new innovative PPPs procurement are on the top agenda of policy makers and academic researchers.The PPP procurement law research may also broad the horizon of theory of the conventional procurement law research.This thesis first conducts a review of literature of the theories rooted in the fields of economics,politics and public administration to reveal the multidisciplinary rationales of PPPs and then based on the representative regulatory instruments of PPPs such as those of the international organizations and certain countries the thesis sets up a research framework for the analysis of the main regulatory issues of PPPs procurement law.As certain members of EU have been leading the world in PPPs and the EU procurement laws have been under consistent reforms,to reflect the need to accommodate PPPs,among others things,this thesis takes the EU PPP procurement law systems as a subject of case study,to observe how well the EU procurement laws have responded to the issues arising from accommodating PPPs by the conventional procurement laws.The thesis lastly provides a critical analysis of the current Chinese laws governing PPPs by applying the theories and observations from the EU case stud y.Innovation of this thesis include the following: in contrast with previous literature,this thesis takes that PPPs deserves as a separate and an independent subject of study against conventional public procurement and thus done;this thesis takes that legal definition of PPPs and its fundamental features are critical for any PPP regulation and thus systematically reveals the legal definition,main features,classification and core mechanism of PPPs;The thesis also sets up a research framework and identifies the main regulatory issues regarding PPP laws and based on this approach and analysis,the thesis argues that PPP laws needs to be coordinated and harmonized,regulatory objectives needs to be inclusive of sustainable developmental goals;scope of regulations needs to be extended to cover pre-award and after award phases to reflect the critical importance of PPP project selection and long term contract execution relationship;that the above issues are critical in attaining effective PPP regulation and the eventual objectives of PPP procurement.This thesis takes that PPPs is in essence an advanced and complex procurement and has distinctive features comparative to conventional procurement,which requires regulatory attention:(1)these is a transfer of risk from public sector to private sector;(2)private finance is involved;(3)there exist various payment mechanisms such as payment by government,by users or the combination there of;(4)payment is based on performance;(5)there is a long term contractual relationship.The thesis also recognizes that PPPs can be classified as contractual PPPs including government procurement-type PPP and concession-typed PPP,and institutional PPP or JV PPP.PPPs are taken as the subject of public procurement regulation as it essentially involves the award of public contract by government to provide public service.Competition lies at the heart of PPP regulation as it is taken as an effective means of allocation of resources,efficiency,and innovation;competition in public market can also help achieve an appropriate balance between equity and efficiency and thus attain the objective of value for money for PPPs.However,including PPP into procurement regulation may present potential challenges to conventional public procurement laws.Firstly,as competition may be long and costly and there exist in sufficient competition,PPP laws need to have measure in place such as appropriate bundling of PPP project to invigorate effective competition;secondly,there should be a balance among transparency,equity and nondiscrimination,procedural efficiency and discretion of procuring entity;there should also be a need to align the main aims of value for money,public policy goals,market access;thirdly,as there exist an issue of renegotiation in long term relationship and incomplete contract,prearrangement of flexible contract are needs and appropriate mechanism needs to be in place to make any adjustment;fourth,institutional PPPs may involves conflict of interest by public sector entity in both awarding and execution phases thus appropriate measures should be there.Additionally,IPPPs operate with dual goals of both selecting the private partner for the mixed entity and awarding a long term contract to the entity and thus may present challenges to conventional procurement laws.Case study of the EU PPP laws reveals that EU procurement laws were indeed experienced with the problems of accommodating PPP into its procurement laws,which provided one of the momentums for procurement law reforms.As a response to the challenge,the EU deregulated its procurement laws to include more flexible procurement methods such as competitive dialogue and innovative partner procurement technique,which are taken as the main PPP procurement methods.At the same time,the EU laws also enhance the requirement for transparency.Legal definition of concession and its application of governing laws in EU were also quite a complex issue for both regulators and judiciary.Part of Concession contracts used to be covered in the public sector procurement law and now with the emerging issues of PPPs,concessions are regulated through a separate and independent concession law,a reflection of new direction of EU PPP law development.In contract with government procurement type of PPP,concession PPP involves more stakeholders,are more complex and operation risk are transferred to the private sector;thus may require more simple and flexible procedural rules.It can be observed that as a first separate EU law governing concession PPP,it may reflect a first EU step towards concession PPP regulation and further development is expected.The EU IPPP regulation reflect the most recent development of PPP forms in member countries,noteworthy of UK's PF2 scheme.The new form of PPP presents challenges for procurement law application.The EU position takes that as selection of the private sector partner in essence involves award of public contract,PPP laws should be coordinated and applies to the selection of private partner under a IPPP scheme;the EU law also recognizes the regulatory issues of potential conflict of interest of public sector entity in both contract awarding and performance and thus provides relevant remedies to address the issue.The research of this thesis on the three types of PPPs separately in separate chapters reflects different policy concerns of EU law on the three different type of PPPs.However,beyond the difference,the EU PPP laws also present distinctive commonalities substantially in terms of both the content of the laws and the approach to addressing the differences among the laws.Firstly,as different type of PPPs requires separate and independent regulation and there may arise issues of conflict,inconsistencies and uncertainties among different laws,the EU has invested much effort in coordinating the laws.These include modernization of conventional procurement laws to accommodate PPPs,clarification of application of laws by different PPPs and coordination of policy issues to maintain consistencies.Secondly,EU PPP laws have broad inclusive policy goals to attain sustainable development goals including integrating into the whole procurement process such policies as promotion of SMEs,environment protection,and inclusive society.The inclusive goals are also implemented through the whole supply chain.Thirdly,the EU PPP laws put competitive awarding procedures at the heart of the PPP regulation.It can be observed that the overall EU procurement laws are built on the classic economic theory of competition.Under EU procurement law,competition is the rule and non-competition is an exception.Fourthly,another distinctive feature of EU PPP law is its flexible awarding procedures.PPP procurement requires more flexible procurement procedures in terms of contract award and renegotiation in contract performance.The selection of private partner in an IPPP project also justifies more flexible procurement procedures.This flexibility is manifested in a number of ways:(1)In terms of definition of procurement requirement or plan,the procurementrules allow consultation with private sector entity for the purpose of defining aprocurement requirement or formulating a procurement plan;(2)In terms of technical specification,the procurement rules allow technicalspecification defined in terms of output or performance;(3)In terms of qualification,the procurement rules allow shortlist of qualifiedsuppliers to exclude those who are obviously not appropriate to establish long termrelationship;(4)In terms of award criteria,given the complexities of PPP,the procurementrules allow comprehensive evaluation;(5)In terms of contract performance,the procurement rules allowsubcontracting by the private partner and renegotiation of contract.Fifthly,EU PPP laws also require high transparency as a means to check and balance the right of discretion under a flexible procurement.the creation of competitive dialogue as the main procurement procedure for PPP as against the much more flexible negotiated procurement already in the EU procurement means the EU law aims at granting the discretion only to the limit of necessity for the purpose of PPP.A competitive dialogue procedure is flexible but much more structured than competitive negotiation.By allowing this method the regulators intention is clear: the appropriate policy for PPP is to provide flexibility and discretion but at the same discourage that degree of flexibility and discretion under a competitive negotiation procedure for the purpose of PPP.Sixthly,it can be observed that the EU PPP laws extend their regulation of PPP to the pre-award and after-award phases.However,as the primary purpose of EU law is to govern the award process,many of the issues in this regard are left to the member countries.The experiences of EU PPP regulation are relevant to Chinese regulation of PPP procurement in a number of ways:(1)The Chinese PPP laws should provide a clear definition of PPP concept and based onthis scope of each governing laws needs to be clarified;the Chinese PPP laws needsalso to address the challenges of accommodation of PPP into the procurement lawsand coordination of each PPP laws to provide consistencies of policies.(2)PPP is only one form of public service provision and may only be effective and usedwhen it can provide better value for money.A purpose of a PPP law is to providebetter legal environment for private engagement in public service provision,but itnever grants PPP per se.a similar neutrality policy is needs in the Chinese PPP laws.(3)Competition policy needs to be at the heart of any PPP law.This includes detailedcompetitive awarding procedure in PPP laws and competition policy consideration inthe design of a PPP contract.(4)Awarding procedure should reflect the flexibility requirement for PPP.The rigidbidding rules of the Chinese procurement law should be reform to accommodate thePPP requirement;(5)Flexibility of procurement procedure should not sacrifice the integrity of theprocurement,especially the competition requirement.The procurement proceduresapplied in practice for Chinese government procurement PPP is too flexible and thereare great potential for misuse and manipulation.More innovative procurementmethods similar to the EU competitive dialogue is required in future law reform.(6)Transparency and sufficient disclosure of procurement information is an effectiveregulatory tool to observe the basic disciplines of a procurement law.The Chineseprocurement law provides sufficient requirement in this regard including arequirement of proactive disclosure of contract text once it is signed.Thetransparency requirement as such provides good basis for deregulation of the Chineseprocurement law.However the implementation mechanism seems to be a problem.EU experience a more rigorous implementation system may be relevant to China.(7)The Chinese PPP laws implement a JV form of PPP,a similar design as the EU IPPP.However,the issues arising under the EU PPP law have not yet come to theawareness of the Chinese policy makers.Thus the EU experience in this regardrelevant to the Chinese regulators in order to identify and address the issues theremay arise.(8)Despite the provision under the Chinese government procurement law on sustainablepolicies,the current PPP policies and practice seems to neglect these important issuesand in many cases the PPP procurements are designed to contradict such policies.Under the bidding law and the new concession law,such policies are not providedand PPP practice seems to be blind in this regards.The EU experience is thus isrelevant in terms of both provisions of such policies under new PPP laws andeffective implementations of such policies. |
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