Public Private Partnerships are forms of cooperation between public authorities and the private sector that aim to provide a public service or project. They result in the setting up of complex legal and financial arrangements involving private operators and public authorities carrying out infrastructure projects or services of use to the public.
These partnerships have been developed in several areas of the public sector and are widely used within the EU to ensure the provision of services, in particular in the areas of transport, public health, education, public safety, IT, waste management and water distribution.
But under Community law there is no specific legal system governing the many different forms of PPPs, and contracts for these partnerships are not in general covered by the EU rules on the single market. In certain cases, they can be subject to the detailed provisions of the European Directives on public procurement. However, other cases and in particular certain "concessions" are not covered.
The Commission wants to ensure that the current legal framework does not prevent economic operators within the EU from gaining access to the different types of PPPs. To this end the Commission launched a consultation on the issue in April last year, and has now published the results.
According to the Commission, a clear majority of respondents supported an EU initiative, legislative or non-legislative, to deal with the question of "concessions". Both a clarification of the term and the rules applicable to their award is required, said respondents.
Many respondents asked how EU rules should apply to the choice of private partners in "institutionalised PPPs", which are public service undertakings held jointly by both a public and a private partner.
In particular, respondents asked about the difference between 'in-house' and third-party entities. EU law on public contracts and concessions applies when a contracting body entrusts a task to a third party, unless the relation between the two is so close that the latter is equivalent to an 'in-house' entity. In general, public-sector respondents argued for widening the definition of 'in-house', while the private sector wished to maintain its existing limited scope.
The Commission is now preparing a Communication, due to be ready before the end of the year, which will indicate the Commission's preferred way forward – whether this is through legislation, interpretative communications or initiatives to improve the coordination of national practice and exchange of good practice between Member States.
