The Argentine Congress has recently passes Public-Private Participation Law (the “Law”). MSI's Argentina law member Garcia Menendez Abogados provides further information on the regulation.
The public-private participation agreements are those entered into between entities of the public sector and private or mixed companies related to infrastructure, housing, activities and services, productive investment, applied investigation and/or technologic innovation projects, whose purposes are activities like design, construction, extension, upgrade, maintenance, equipment and goods supply, operation and/or financing.
The PPP agreements are meant as an alternative to the traditional public works projects in which the government afford the projects with its own economic and financial resources (the PPP projects exclude the regulations related to the public works), and its goal is essentially to attract private financing for determined relevant works. In view of that, other than the roll of principal and supplier, the law has always present the roll of the funders, essential part of the structure in order to obtain private resources to finance the projects.
The PPP can be instruments by the subscription of agreements, or by the incorporation of per shares companies (including mixed companies, in which the government is a party), trusts, and other vehicles and associative schemes.
The contractual or associative documentation has to set forth certain minimum requirements in order to grant legal certainty and foreseeability to the relationship. In particular, among others, it is set forth that the PPP relationships cannot be established for more than 35 years, including extensions, and it is set forth the possibility to resolve conflict by technical panels and arbitration, even outside Argentina (in this last case, the Government has to inform the Congress).
