- Objectives & Policies
- Methods & Regulations
- Governance framework of the PSP project
- Tendering methods and Tendring documents
- Financing Contracts
1.Supporting achieving the strategic objectives of Government entities, rationalizing public expenditure, increasing Government revenues, raising the efficiency of the national economy, and increasing its competitiveness to face regional and international challenges and competition.
2.Enhancing the coverage and the quality of services, and the availability of services at the appropriate time and cost, raising the efficiency of Assets related to PSP projects and improving their level of management, and supporting readiness or restructuring of sectors, bodies, Assets, and Public Services targeted for PSP.
3.Encouraging local and foreign private sector to invest and actively participate in the national economy through projects that achieve the developmental objectives of the Government, and are economically feasible for public and private sectors, and increase the private sector’s share of the Gross Domestic Product (GDP) resulting in economic growth.
4.Increasing the participation of citizens in the ownership of Government Assets, increasing employment opportunities, and the optimal utilization of the national workforce.
In order to consider the project as Public Private Partnership (PPP), The law stipulates a definition of partnership between the two sectors and The minimum elements that must be present for the project to be considered as a partnership project between the public and private sectors, as stated therein.
Public Private Partnership (PPP) defined as: A contractual arrangement related to Infrastructure or Public Service which results in a relationship between the Government and the Private Party containing the following elements:
1.The duration of the contractual arrangement shall be for a period of (5) years or more.
2.The Private Party, pursuant to the contractual arrangement, undertakes works including two or more of the following: design, construction, management, operation, maintenance, or finance of the Assets, whether these Assets are government-owned, or owned by the Private Party, or both.
3-There is a qualitative and quantitative allocation of risks between the Government and the Private Party.
4-The payments owed by or to the Private Party under this contractual arrangement are primarily based on the performance of its obligations.
5-The law also included in its ninth article that if the elements were not met therefor, Council of Economic and Development Affairs “CEDA” may, based on recommendation from National center for PPP and Privatization “NCP” Board of Directors, assess any Infrastructure or Public Services project, and classify it as a PPP or Divestment project subject to the provisions of the Law, or classify it as a project that is not subject to the provisions of the Law, irrespective of whether the definition of PPP or the definition of Divestment contained in the Law applied or not.
The provisions of the Law shall apply to all Contracts entered into by ministries, other Governmental bodies, and companies that the Government sets up or owns, directly or indirectly, with a share that exceeds (50%) of its capital and the purpose of which is the execution of a PSP project.
In order to stimulate the foreign private sector to invest and actively participate in the national economy, the law ensures (after an approval from the NCP’s board of directors), the Private Party, where it is a foreign investor, may lease real estate within the boundaries of the cities of Makkah and Medina for a period equal to the duration of the Contract for the purpose of executing the PSP project.
1- The Approving Authority for the PSP projects:
a. the Council of Ministers shall be the Approving Authority regarding granting approvals for the Project Business Case Documents; tendering; awarding; and the signing of relevant Contracts related to Divestment projects, and PPP projects involving the transfer of ownership of assets owned by any Concerned Entity to the Private Party, whatever the value of the project.
b. NCP’s Board of Directors shall be the Approving Authority for PPP projects, within the, granting all approvals required under the Law for PPP projects with a value of SAR 500,000,000 or more per Contract, including approving the Project Business Case Documents, tendering, awarding, and Contract signing.
c. The Supervisory Committee: The Supervisory Committee shall be the Approving Authority regarding, granting all the approvals required under the Law for a PPP project that falls under its supervision, with a value of less than SAR 500,000,000 per Contract, or under which no annual direct financial obligations are incurred by the government, including approving the Project Business Case Documents, tendering, awarding, and Contract signing.
2- The Contracting Authority for the PSP projects:
A.The Supervisory Committee: the sector Supervisory Committee shall be the Contracting Authority for PSP projects implemented within the sector, and it has the powers and functions of the Contracting Authority.
B.Concord Entity: Except for the above, The Private Sector Participation Governing Rules stated that shall be the Contracting Authority regarding the following functions linked to the sector PSP project:
- Preparing the Project Business Case Documents, preparing the PSP project tender documents, and submitting them to the sector Supervisory Committee to obtain the necessary approvals.
- Managing the PSP project tendering process, including expression of interest (EOI), request for qualification (RFQ), request for proposals (RFP), and the evaluation of the same, negotiation with bidders, and any other functions related to the tendering process, and submitting the outcomes to the sector Supervisory Committee to obtain the necessary approvals.
- Managing the award stage and signing the contract with the Private Party and finalizing the related procedures after obtaining the necessary approvals from the Supervisory Committee and the Approving Authority.
- Managing the PSP contract implementation stage and monitoring the Contract following signature.
1-Expression of Interest Phase,
2-Pre-qualification Phase, and
3-RFP Phase.
Tendering and bidding documents:
1.Expression of Interest (EOI) A tender document issued by the Contracting Authority to the market to identify the size of the targeted market and interest in the proposed PSP Project as follows:
A.A summary of the PSP Project and its expected schedule.
B.Information on the expression of interest and how it is submitted.
C.The date of receipt of expression of interest.
D.A statement that RFQ will only be sent to the persons who has expressed their interest in the PSP Project.
2.Request for qualification (RFQ) A tender document issued by the Contracting Authority to potential bidders to evaluate their qualifications and/or capabilities to be qualified to submit proposals for the PSP Project.
A.The RFQ timetable and the preliminary PSP Project timetable.
B.Instructions on the SOQ contents, requirements, supporting documents and required format, and an electronic or physical address to submit the SOQ and supporting documents.
C.The deadline for submitting SOQs along with a statement that SOQs will no longer be accepted after the specified date and time.
D.Setting a single point of contact to answer the bidders’ inquiries and provide clarifications.
E.A statement regarding the minimum requirements for applicants
F.A description of the pre-SOQ inquiries process, including the procedures and schedule for receiving and responding to inquiries.
G.Identification of how bidders’ information, documents, and intellectual property rights will be handled.
H.A description of the PPP project, the Public Sector’s expectations, and the project site and other relevant features, or a description for the assets to be transferred in the divestment projects, the objectives of selling the asset, the process structure, including ongoing contractual obligations – if any -.
I.The qualification procedures, and the evaluation criteria and methodology.
J.A statement of the method of PPP and any other commercial or contractual details related to the SOQ.
K.A statement that the government and the Contracting Authority shall not bear any costs incurred by bidders in preparing and submitting SOQs.
L.The consortia rules and requirements, bidders’ eligibility restrictions, and disclosure and avoidance of conflict of interest.
M.A statement that the Contracting Authority may, at any time and for any reason, amend, change, or cancel the RFQ and tender process as a whole and that the government shall not be liable for any costs incurred by bidders.
N.A prohibition on communication between bidders, except where expressly permitted by the RFQ,
O.A prohibition on communication, collusion, conflicts of interest, bribery or other corruptive behavior between bidders and government officials, and a statement that bidders shall be required to confirm their compliance with all the above and stating any previous sanctions or restrictions for violations, if any.
P. A description of the process of receiving requests to extend the deadline for submitting SOQs.
3.Statement of Qualifications (SOQ): A written statement submitted to a Contracting Authority in response to a Request for Qualifications, The SOQ, shall as a minimum, include:
A.full description of the individuals and bodies of which a bidder is composed.
B.Roles and responsibilities performed by every member of the consortium.
C.Evidence of meeting the following by the bidder
- Experience related to the PSP Project, the sector or similar Projects.
- The ability to execute the PSP Project.
- Solvency and the ability to fund the project costs.
- Experience with comparable Projects that included the essential elements of PSP such as financing, design, construction, ownership, operation and maintenance.
- The ability to fulfil requirements of shares and financing, if any.
- Previous experience in the development of Projects, including success and innovation, and addressing their social and environmental impacts.
- Experience in human capital development, transfer of technology and capacity and promotion of local content.
- Understanding of Public Sector services and PSP Project needs and the ability to interact and work with Public Sector entities.
- Ability to manage risks throughout the PSP Project and maintain quality of services and infrastructure.
4.Request for Proposals (RFP) A tender document issued to bidders by the Contracting Authority to request proposals in relation to the PSP Project.
A.A description of the RFP, its role in the bidding process, and a description of how the proposals will be evaluated.
B.The time frame for implementing the PSP Project.
C.An overview of the PSP Project and its objectives, financing assumptions and expectations, as applicable, (unless excluded in the approved Tender Plan), contracting model, due diligence process, and the available data or reference materials, including access to a data room or other information resources relevant to the PSP Project.
D.For Divestment projects, a description of the Assets subject to the Divestment, the proposed tendering method (such as assets, shares, etc.), any problems related to the Divestment, technical issues, studies, technical drawings related to the asset, any stipulations related to the Contract (such as treatment of employees, the right to use the land, investment commitments, treatment of debt, financial derivatives, etc.), and alignment with any Divestment strategy (such as: identifying how the proposed project will achieve the objectives of the sector, linkages with the structuring of the legal and regulatory framework for the sector, and the timetable for implementing any legislative changes).
E.A statement about the possibility of submitting alternative technical concepts by the competitors for the PSP Project and how these concepts are approached in terms of confidentiality if stipulated in the approved Tendering Plan.
F.A description of the pre-bid clarifications process, including the procedures for receiving and responding to clarifications, and the timetable and number of clarification rounds.
G.A description of the process for receiving requests to extend the bidding timetable.
H.Reference to the applicable legal instruments for the PSP Project, including any decrees, orders, laws, rules, and regulations upon which the process relies.
I.Instructions on the information and materials which bidders must provide in their proposals, and instructions on submitting proposals including a requirement for submitting technical and financial proposals separately, any proposal format requirements, and an electronic or physical address for submitting proposals and any supporting materials. For Divestment projects where the selection process will be based solely on price, a combined proposal may be requested.
J.The deadline for submitting proposals including a statement that proposals will no longer be accepted after the specified date and time.
K.A single point of contact for the Contracting Authority.
L.A requirement to identify a single point of contact for the bidder.
M.A statement that the government and the Contracting Authority shall not bear any costs incurred by bidders in preparing and submitting proposals. In the event that the Board of Directors approved that the Contracting Authority or any other government entity may bear such costs, this may be included in accordance with the approved decision.
N.A statement that the Contracting Authority may, at any time and for any reason, amend, change, or cancel the RFP and tender process as a whole and that the government shall not be liable for any costs incurred by bidders as a result thereof.
O.A prohibition of communication between bidders unless expressly permitted in the RFP.
P.A prohibition of collusion, conflicts of interest, bribery or other corruptive behavior between the bidders and the concerned employees and staff in the Concerned Entity and the Contracting Authority. In addition to the statement that bidders shall be required to confirm their compliance with the same, and noting applicable sanctions or restrictions for violations.
Q.Identification of how bidders’ information, documents, and intellectual property rights shall be processed.
R.Rules and requirements where the bidder is a consortium, limitations on the eligibility of bidders, and disclosure of conflict of interest.
S.A description of the proposal evaluation criteria and methodology, and whether pass/fail criteria will be used, and detailed statement of the financial and technical requirements and the evaluation process as a whole.
T.A description of the proposals ‘ validity period and a requirement that proposals submitted must be valid for at least one hundred and eighty (180) days from the date of receipt, unless the Contracting Authority agrees to a different period.
U.A statement on whether a best and final offer (BAFO) round may be conducted.
V.A prohibition for a bidder or any member of the bidding team to submit more than one proposal.
W.A prohibition of providing misleading information and for fraudulent behavior in the tender process and excluding those who do so.
X.Identification of required preliminary or final bid bond or any other forms of bid guarantee, and setting any subsequent fees that may be payable upon completing the tender process, and the amounts and beneficiaries thereof.
Y.Appending to the RFP a draft PPP Contract, aligned with the requirements of the Business Case Documents, and any other relevant documents.
- Build-operate-transfer (BOT).
- Build-own-operate (BOO).
- Build-own-operate-transfer (BOOT).
- Build-transfer-operate (BTO).
- Design-build-maintain (DBM).
- Design-build-operate (DBO).
- Design-build-finance-maintain (DBFM).
- Design-build-finance-operate-maintain (DBFOM).
- Design-build-finance-operate (DBFO).
- Design-construct-manage-finance (DCMF).
- Rehabilitate-own-operate (ROO).