Economic Governance & G20

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Key Messages on the World Bank Group’s 2017 Guidance on PPP Contracts

The World Bank Group recently published its 2017 Edition of the Guidance on PPP Contractual Provisions (the Guidance). By setting forth recommended contractual provisions, the Guidance is expected to speed up or facilitate the conclusion of PPPs. At the request of the Heinrich Boell Foundation, the law firm of Foley Hoag LLP reviewed the Guidance to determine whether the contractual provisions recommended by the World Bank Group achieve an appropriate balance between contracting parties, and adhere to common practices and international law. 

By Motoko Aizawa

Summary Comments on the World Bank Group’s 2017 Guidance on PPP Contractual Provisions

In an effort to promote standardization and expedited negotiation of contracts for Public-Private Partnerships (PPPs), the World Bank Group introduced the 2017 Edition of the Guidance on PPP Contractual Provisions (the Guidance). The Guidance provides both sample language for contracts as well as commentaries to explain legal options. While the Guidance provides improved and more detailed advice as compared with the 2015 version, it continues to emphasize the preferences and requirements of the private sector partner without commensurate consideration of the perspective of the government. In response, the following comments on the Guidance are offered to help ensure that PPP contracts achieve an appropriate balance between investor rights, on the one hand, and the rights of the government and people, on the other.

By Foley Hoag

INTRO

The Economic Governance Program focuses on democratizing governance structures to ensure that the international financial institutions and bodies, such as the G20 and BRICS, are representative and accountable. It also works on democratizing policy-making in thematic areas (e.g., finance, economics and trade) and sectoral areas (e.g., infrastructure) to strengthen “real economies” in ways that respect the rights of the earth, vulnerable groups, and women. We support the engagement of citizen’s groups in developing countries in both areas, including through  public education and capacity-building.

Finance, Development & G20

Submission to the World Bank Group and Summary Comments on the Draft Report on Recommended PPP Contractual Provisions

With legal counsel, the Heinrich Boell Foundation prepared this submission to the World Bank Group's consultation on its draft Report on the 2016 Edition of its "Recommended PPP Contractual Provisions". It cautions that the draft "Contractual Provisions" put an inordinate level of risk on governments (with potential fiscal consequences); obstruct the state's "right to regulate" in the public interest (for instance, to protect the environment and human rights); prefer international (rather than domestic) settlement of disputes; and fail to adequately promote contract transparency. 

By Nancy Alexander
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