Frequently Asked Questions
Why is the ratification of a contractual agreement by the Parliament not necessary according to new legal framework?
Ratifying concession agreements by Law cannot be considered as a viable solution or deemed necessary, although in the past this was proven useful for the resolution of legal issues. Before Law 3389/2005, the ratification of concession agreements by the Parliament was needed to validate the result of the tender award procedure, to establish the rights of the contractor and, often, to include deviations from special clauses, in order facilitate and accelerate the implementation of a project (for example precipitation of licenses, special tax status, etc). Of course, the legislatitative ratification had certain drawbacks. It caused both legal issues (for example, the twofold legal character of concession agreement: is it a contract or legal framework? How is it modified?) and practical issues as well (for example important delays in the contract award procedures). According to Law 3389/2005, the legislatitative ratification is no more necessary as: - the minimum content of a Partnership Contract is clearly determined (article 17), - the new legal framework is explicit and flexible and limits the need for deviations and hence the need for ratification by the Parliament, (the contracts are subject to the terms of the Partnership Contract and also the Greek Civil Code) and - chapters 5 and 6 resolve issues that in the past required special legislatitative regulations (granting of permits, archaeological finds, protection of the environment, expropriations, etc).
It is difficult to determine in advance the time required between the invitation to tender and finalisation of the contract award procedure, because of the complexity of each project. However, it has been observed in other European countries that the usual time required ranges between 9 to 12 months. This is because of the fact that the invitation to tender is in line with the Community Law, which determines specific periods of invitation to tender, submission of tenders, judicial appeals etc.
According to article 17 of Law 3389/2005, the Partnership Contracts have clear and detailed descriptions of the rights and obligations of both Parties (Public - Private Entities) for the Partnership object. The method of monitoring the performance and operation of the project is agreed in the contract and can be done either by independent companies recruited for this purpose by the Public and Private Entities acting in common, or by the competent State authorities.
Concession agreements are a subset of PPPs. Law 3389/2005 creates a simplified legal framework which encodes the provisions that up to now constituted the base for the implementation of concession projects and includes new legal provisions so as to cover other forms of partnerships, beyond that of concessions.
The implementation of PPPs has been the issue of consultation for many years in our country. Many people who, because of their involvement in the concession projects or because they had monitored the developments in other European countries and internationally, had pointed out the need to establish a legal framework, which would allow the wider implementation of PPPs. It was necessary to overcome a legal gap in Greece, which led each contractual agreement for a project co-financed by the private sector for ratification by the Parliament. Furthermore, lot of issues, hindering the negotiations for the financing of the projects and causing delays in their implementation, had to be settled. It was also necessary to create a framework, through which private entities would be able to implement projects and services, in which the end users are not charged. This is the case of public schools, hospitals, prisons and more, the implementation of which as PPPs, presupposes their future payment directly by the State on an annual base. Such projects could not be tendered in the past. Law 3389/2005 covers the existing legal gap and outlines many issues and problems. It does not regulate all the issues because of the individual character and complexity of each PPP. A single treatment of these issues would create more problems than the ones it comes to solve.