What is PPP?

1. What is PPP? Planning + Building + Financing + Operation (+ Post-contract life) = PPP PPP-Sectors: PPP – construction, PPP – infrastructure

2. Types of PPP contracts- in German law - Differences and core content Acquisition model Hire-purchase of facility/asset Owner model Planning, construction, financing, operation under ownership of the principal Leasing model Rent with option to buy Rent model Contract for rent extending beyond 10 years Contracting model Contract to operate the facility/asset Licence model Operation of facility/asset with user fees collected privately Company model Operation by way of project group

3. PPP project structure- example - Licenser Advisor Advisor Fed / Land / Municipality Service Construction Concession Grant Loan provider Shareholder Equity capital Loan Licensee Banks/capital market Investors Project company Return Interest/re-payment Maintenance Operation Remuneration Remuneration Construction at agreed price and timeframe Remuneration Operator Maintenance Operation Maintenance General contractor Provision of service Rent or fee Construction planning Public sector or private sector use

4. History of PPP at EU level 07 May 2003 Commission publishes “Internal market strategy – priorities 2003 – 2006”, which highlights the need to clarify legal issues relating to PPP. The publication of a green paper on PPP is announced. 21 May 2003 Commission publishes Green Paper on services of general interest. This paper entails a substantial review of the Commission's service policy and asks whether a general legal framework should be created at Community level for services of general interest. The Commission plans top publish a green paper on public procurements and on PPP in the second half of the year. 30 Apr 2004 Commission adopts Green Paper 30 Apr 2004 Forwarded to the Council 30 Apr 2004 Forwarded to the European Parliament (EP) 27 Oct 2004 Opinion by the European Economic and Social Committee 17 Nov 2004 Opinion by the Committee of the Regions End 2005 Commission announces resolution on further PPP legislation for the end of 2006 26 Oct 2006 Resolution by EP

5. History of PPP at federal level Source: PPP Task Force, Federal Ministry for Transport, Building and Urban Affairs

6. More PPP Market structure of PPP in Germany More private capital for public tasks More co.’s in the provision of public services Framework More/bigger projects Admin. building Education Research Laws Regulations Models Transport modify: Contracts PC PSC Budget issues System of NA Double entry bookkeeping Defence Health Provision amendments: Competition law Tax law Accounting law Statistics law Change in rules on awarding contracts PB = Profitability calculations PSC = Public Sector Comparator NA = National accounting

7. PPP organisation of the govt in Germany Ministry of Transport Ministry of Defence Ministry of Economics ConstructionTransportCivil Defence Project working group PPP Task Force g.e.b.b., Dept. M / Group M I Gesellschaft für Entwicklung, Beschaffung und Betrieb mbH Project development co. Ministry of Finance Roads Rail, Sea, Air Federal states East West Deutsche Einheit Fernstraßenplanungs- und -bau GmbH Verkehrsinfrastruktur- entwicklungsgesellschaft mbH Deges VIFG = Project management co.’s

8. The phases in the PPP procurement process Steps in examining PPP profitability Phase I Determining needs, financeability and profitability of measures PPP test for suitability Preliminary decision for or against continuing to pursue varies PPP options Phase II Drawing up conventional comparative values (Public Sector Comparator – PSC) Provisional examination of profitability Preliminary decision for or against publishing call for tender Determining the maximum amount to be appropriated in the budget (budget readiness) Appropriation in budget and call for tender Phase III Final profitability analysis Final decision on awarding and signing of contract Phase IV Project controlling The PPP procurement process in GermanyAgreed procedure between central and regional government

9. Folie 9 Requirements for collaboration - Example - Adequately shared risks between public and private sectors

10. ABC modules of tender I Module A: Construction Mostly invitation to tender as a general contractor subject to the provisions of the guidelines on awarding contracts; to be built, for example, on a piece of land owned by the party issuing the invitation to tender Module B: Financing part A B1: conventional lease financing via the budget B2: pure finance leasing (no equity capital of private investors, thus no tax effects), sometimes with forfeiting. B3: tax-optimised fund leasing models with equity capital of private investors. Module C: Investor model Same-source construction and financing on the basis of the conditions of modules A and B with a fixed-price model without disclosing the details of the calculation.

11. ABC modules of tender II In addition to parts A, B und C, additional tenders can be invited in suitable cases: Module D: Similar to Module C, but using functional description of construction and with the bidder’s own planning, possibly also on a piece of land owned by the party inviting tender. Module E: Offers to buy, hire-purchase of simply rent suitable objects which have already been built or which are in the process of being built.

12. Folie 12 Overview of the current status of the PPP Simplification ActProject working group consisting of the majority parties in the German Bundestag and including representatives of German industryAs of May 2007

13. Overview of standardisation work of central and regional government in Germany * SME = Small and Medium sized Enterprises

14. Table of PPP Projects I

15. Table of PPP Projects II

16. PPP projects in Germany since 2003 average efficiency gain of PPP project realised: 15.4 %

17. Folie 17 PPP communal distribution in Germany*- € 2.5bn invested- * Communal PPP survey 2005

18. Folie 18 PPPs in France : a few figures

19. Folie 19