Study On The Government Regulation Under Public Private Partnership

Public Private Partnership(hereinafter “PPP”) refers to a cooperative relationship between public sector and private sector in the development of social and economic infrastructure. The core value of a PPP project is “Cooperation”, thorough which the private capital is permitted to deliver the public service in accordance with the relevant laws and regulations and the agreement concluded with the government. Government is acting as three characters in this cooperative relationship: the regulator, the rule maker and the participant, which leads to a readjust to the original way to its previous regulation method. Therefore this dissertation is to assess the regulation of the government under the PPP project and to address the possible ways to improve the current practice of the governmental regulation.This dissertation is based on the study of success and failure case of PPP worldwide with a special focus on the reasons for the failure, and intends to provide the new approaches for the regulators to deliver advanced supervision on the PPP project.Chapter I starts with the fundamental theory to justify the obligations of the government to provide the public products. Then the needs for the private sector to participate in the field of public service is discussed. In conclusion, this chapter is to argue and illustrate that PPP is a perfect combination to balance the need of the government to develop the infrastructure in a more efficient way and the need of the private capital to enter into a profitable business area, while at the same time making benefit to the public welfare.Chapter II is to discuss the justification of governmental regulation in the PPP project. First, it summarizes the necessities of governmental regulation in the PPP project, based on the conflict of interest between the public and private sectors. Second, it studies the legal and contractual foundation of governmental regulation.Chapter III intends to discuss the regulation failure of the government in the PPP project. First it summarizes the different types of Regulation Ineffective and Regulation Inefficient, which leads the Second part of the chapter, to the underlying reason for such regulation failure in the PPP regulation.Chapter IV is to raise advice to improve the regulation methods of the government. First, it justifies the introduction of Flexibility Regulation, by reasoning that the core value of PPP is cooperation and the key points of PPP are negotiation and market-oriented approaches. Second, it justifies the introduction of Incentive Regulation with economic theory and study. In the last part, this dissertation proposes the specific measures to improve the governmental regulation.