Public-Private Partnerships Bill Approved in El Salvador

Salvadoran Congress has passed a law that will allow public institutions to form partnerships with private companies for infrastructure and public services projects.

Friday, May 24, 2013

From a press release issued by the Legislative Assembly of El Salvador:

In order to establish the regulatory framework for the development of projects for the provision of infrastructure and public services of general interest effectively and efficiently, the Legislative Assembly in Plenary approved with 84 votes in favor, the "Special Law on Public Private Partnerships"(PPP).

The legislation establishes, among other things, that the minimum amount of investment for a public private partnership should be $10 million, while contracts for amounts smaller than this that are not granted in concessions or public debt shall be regulated by the Law on Procurement and Contracting by the Public Administration (LACAP) and endorsed by the Salvadoran parliament.

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More on this topic

El Salvador Prepares First Public-Private Partnerships

May 2013

A new wind farm and the expansion of the International Airport of El Salvador, are the first two projects to be conducted under this system.

"Today (yesterday) I called a meeting with the president of CEPA (Autonomous Executive Port Commission) and CEL (Executive Hydroelectric Commission of the Lempa River) to immediately structure the first two projects: the expansion of the international airport and the wind project which the CEL is working with," said Alexander Segovia, Technical Secretary of the Presidency.

Críticsms From Businesses in El Salvador on the Partnerships Act

May 2013

Private sector operators see in the Law of Public-Private Partnerships serious deficiencies which would prevent the bill from obtaining the desired results.

"The law, as it has been approved, will not achieve the expected results, we believe that it is not a good law, it has serious deficiencies that will make it very difficult to obtain the expected results," said Javier Castro, director of Department of Legal Studies (DEL) of the Salvadoran Foundation for Economic and Social Development (FUSADES).

El Salvador: Minimum Investment for Partnerships to be $10 million 

May 2013

Salvadoran Congress has stipulated that the minimum investment amount for a private public partnership should be 10 million dollars.

From a press release of the Legislative Assembly of El Salvador:

The Special Committee on Finance and Budget, began review on Monday of the Bill on Public-Private Partnerships (PPP), which is to establish the regulatory framework for the development of projects for the provision of infrastructure and public services of general interest, in an effective and efficient format.

El Salvador: 40-year Contracts for Public-Private Partnership

May 2011

The bill submitted by the Government proposes a term not exceeding 40 years, including extensions, for public-private contracts.

The government is seeking to encourage private participation in infrastructure with the new law on Public-Private Partnerships (PPP).

The proposal includes three types of contracts for the PPP: