Highlights

Law and issue date: no. 67 of 2010 (the Law) issued on 18 May 2010, amends the participation of the private sector in infrastructure, services and public utilities projects.

Amendment and delivery date: no. 153 of 2021 (the Amendment) was delivered on 18 December 2021 and is the first amendment to the Law.

Purpose: The main amendments and additions introduced under the Amendment mainly tackle the mechanism and process of contracting as well as the applicable principles concerning infrastructure, services and public utilities projects concluded in participation with the private sector.

Entry into force: 01 February 2022.

Concerned entities and scope of application

The Amendment essentially addresses private sector entities involved—or wishing to be involved—in infrastructure, services or public utilities projects (Project(s)). The scope of application includes the following:

1. Investors;
2. investors qualified by the administrative authorities;
3. financing entities and bodies; and
4. administrative bodies represented by the Supreme Committee for Partnership Affairs (SCPA) and the Central Unit for Participation (CUP).

Key provisions

The Amendment includes several key and major provisions to the Law. Such amendments include, but are not limited to, the following:

1. The Cabinet of Ministers may exclude contracts of infrastructure, services and public utilities projects which are concluded between the administrative authorities subject to provisions of the Law with the Sovereign Fund of Egypt (as well as its sub-funds or affiliated companies) from the application of this Law.
2. Contracts in connection with the Projects are now clarified and place the following criteria into consideration:
   1. the economic and financial balance;
   2. the common interests of its parties;
   3. the transparency of contracting methods; and
   4. the equal opportunities and equality between similar positions in cases of competition.
3. The Amendment, in reparation of grey areas under the Law, now clearly provides an exhaustive list of contracting methods, as follows:
   1. Public Tender or Bid: common method of contracting;
   2. Limited Tender or Bid: in case the relevant Project requires technical and financial competencies fulfilled by specific entities;
   3. Direct Contract: in cases where, among others, the economic interest and social urgency require faster procedures; and
   4. Contracting a Project initiated by the private sector: provided that the relevant Project:
      • is innovative and with completed studies and financials in place;
      • achieves an economic or social interest for the state; and
      • was not planned for by the administrative authority at the time of its submission.
      • Moreover, the Amendment places a new obligation on administrative authorities. Annual plans submitted to the Ministry of Planning and Economic Development must prepare and provide studies for the projects as outlined in this Amendment. Further to that, the Ministry of Planning and Economic Development will refer a suitable, proposed Project to the SCPA, along with the State’s sustainable development plan for study and preparedness. The general plan of the State’s economic and social development will include a list (List) of the chosen projects that meet the requirements of this partnership system.

Important stipulations

The Amendment also outlines SCPA competencies by mentioning its role in approving the List, as well as determining the contracting method of each project therein.

Additionally, the Amendment introduces these major procedural amendments regarding the contracting process:

1. The administrative authority must have these SCPA authorizations before beginning any contracting procedures:
   1. CUP approval;
   2. approval of the relevant Project by specialists and counsels assigned for preliminary studies, to verify all required data, licenses and authorizations; and
   3. (if applicable) duly allocated land necessary for the Project.Also, the CUP representative shall now assist in all procedural committees.
2. Moreover, the administrative authority now has the ability to hold initial meetings with investors and financing entities to discuss certain topics to provide clarification on technical and financial offers.

Note, it is important to highlight the role of two significant committees already mentioned under the law which were modified by the Amendment, as follows:

• The Amendment stipulates that in cases where the nature of the Project requires a pre-qualification procedure for the investors, a Pre-qualification Committee may be formed by a decision of the competent authority that consists of technical, financial and legal experts. Additionally, this includes representatives from CUP and the participation unit. This committee is competent with the investors’ pre-qualification on technical, financial, legal and operational levels and shall issue a list of qualified investors. The committee’s role remains significant in case of a Consortium consisting of several qualified investors.
• The Appeals Committee presided over by the Minister of Finance, as per the Amendment, is now competent to only examine decisions issued during the pre-contracting phase and excludes those issued during the contracting and execution phase. The Amendment also reduces the period of appeal to within 15 days, instead of 30 days, from the decision notification or learning of the decision.