PPP stages and process

PPP stage explanation

Once a decision has been taken on the purposiveness of a PPP implementation, the "green light is given" for the private entity selection phase. The aim of this phase is to first prepare for the private entity selection phase and finally to select the private entity that will implement the PPP project and sign the PPP contract with it. The selection of the private entity must be published no later than 180 days after the decision on the purposiveness of a PPP implementation is taken.

Private entity selection process

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1. Preparation of private entity selection documents. 

The public entity decides whether to prepare the private entity selection documents itself or to have them prepared by consultants. If you decide to outsource this work to consultants, it is recommended that you follow the CPMA's Recommended Terms of Reference for the procurement of selection conditions, which can be found here. NOTE. Language - Lithuanian.

The CPMA has developed methodological material and standard documents for the selection of a private entity, which are prepared in accordance with the requirements of the Manual on Government Deficit and Debt prepared by Eurostat and other documents, after evaluating the existing PPP practice, and are constantly updated to include new and relevant conditions and amendments taking into account changes in the practice:

For methodological guidance on the selection of a private entity, please follow this link. NOTE. Language - Lithuanian.

For the standard selection conditions for PPP projects (government and private entities partnership, VŽPP form), please follow this link. NOTE. Language - Lithuanian.

For the standard selection conditions for concession projects, please follow this link. NOTE. Language - Lithuanian.

For the standard selection conditions for school building projects, please follow this link. NOTE. Language - Lithuanian.

For the standard selection conditions for street light projects, please follow this link. NOTE. Language - Lithuanian.

For the standard selection conditions for energy efficiency projects, please follow this link. NOTE. Language - Lithuanian.

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2. Obtaining a CPMA opinion

The public entity submits to the CPMA the selection conditions for the private entity for the CPMA's opinion on the compliance of the documents with methodological documentation. The CPMA's opinion shall be given within 20 days of receipt of the selection conditions.

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3. Publication of a market consultation on the conditions for selecting a private entity. 

The purpose of such a market consultation is not only to receive written comments from the market but also during an organized meeting (which can also take place remotely) to present the selection conditions to potential investors and financiers and to ask questions.

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4. Publication of a contract notice

If relevant observations were received during the market consultation, the conditions for selecting the private entity shall be adjusted and preparations shall be made for the publication of a contract notice. When submitting documents to the Public Procurement Service (PPS) on the publication of a contract notice, the public entity must also submit the CPMA's opinion.

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5. Submission and evaluation of applications for selection

This step involves the evaluation of the qualification requirements of the candidates who have submitted the applications, the absence of any grounds for exclusion, and a prequalification (if provided for in the selection conditions).

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6. Depending on the selection method of the private entity, initial proposals/solutions/non-binding proposals/comprehensive proposals (hereinafter referred to as proposals) shall be submitted. 

The Procurement Commission shall verify that the proposals meet the requirements set out in the selection conditions. Tenderers whose initial proposals comply with the requirements set out in the selection conditions will be invited to negotiate/dialogue.

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7. Conducting negotiation/dialogue

Negotiation/dialogue consists of technical, financial and legal stages. During these stages, revisions/additions to technical specifications and draft PPP contract shall be made.

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8. Preparation and submission of the final draft PPP contract for evaluation. 

Before the legal stage of the negotiation/dialogue is completed and after a draft PPP contract is negotiated with all tenderers, a final draft PPP contract (one) shall be prepared and submitted to the Ministry of Finance and the CPMA, which evaluate within 30 days whether the assets created during the implementation of the PPP contract are likely to be recorded in the balance sheet of the state/municipality. This evaluation follows the Eurostat Manual on Government Deficit and Debt, available here, as well as the Eurostat Manual for Public-Private Partnership Projects, which can be found here.

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9. "Dress rehearsal" for updated proposals.

After the negotiation/dialogue, but before their completion, tenderers will usually be asked to update the individual parts of the technical proposal, modification of which is necessary, taking into account the results of the negotiations/dialogue and the revised technical specifications, and to update the financial operating model. This stage avoids potential technical errors in the final proposals and reduces the risk of litigation. The dress rehearsal usually takes place while the Ministry of Finance and the CPMA evaluate the draft PPP contract.

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10. Submission and evaluation of the final proposals. 

The Procurement Commission shall evaluate whether the final proposals meet the requirements set out in the private entity's selection conditions, and the proposals that do meet those requirements shall be evaluated according to the cost-effectiveness evaluation criteria set out in the conditions, and a successful tenderer shall be selected.

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11. Notification of candidates and tenderers of the results of the selection process and application of the deferral period.

Notification of candidates and tenderers of the results of the selection process and application of the deferral period.

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12. The pre-award phase before a PPP contract is concluded. 

 Before signing the PPP contract, the following mandatory actions stipulated in the selection conditions shall be carried out: the successful tenderer must carry out and submit to the public entity an audit of the financial operating model, establish a private entity to implement the PPP contract, provide a guarantee for the private entity's obligations under the PPP contract, and renew the proposal assurance.

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13. Conclusion of a PPP contract

A tripartite contract is concluded between the public entity, the successful tenderer and a private entity established by it. For the PPP contract to enter into force, the conditions for the entry into force of the contract provided for in it must be fulfilled.

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14. Submission of the PPP contract to the Ministry of Finance

Within 30 days of signing the PPP contract, the public entity submits a copy of the PPP contract, together with an English translation, to the Ministry of Finance, which in turn submits the documents to the State Data Agency for evaluation of the impact of the PPP contract on the government deficit and debt ratios. This evaluation follows the Eurostat Manual on Government Deficit and Debt, available here, as well as the Eurostat Manual for Public-Private Partnership Projects, which can be found here.

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