On Public-Private Partnership


Published: 2009-11-11

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Official translation
2 March 2011
 
Government of the Republic of Lithuania
 
 
 
 
 
RESOLUTION NO 1480
 
 
ON PUBLIC-PRIVATE PARTNERSHIP
 
11 November 2009
Vilnius
 
Pursuant to Paragraph 8 of Article 152 of the Law of the Republic of Lithuania on Investments (Valstybės žinios (Official Gazette) No 66-2127, 1999; No 77-3164, 2009), Paragraph 1 of Article 281 of the Law of the Republic of Lithuania on Concessions (Valstybės žinios (Official Gazette) No 92-2141, 1996; No 70-3163, 2003; No 82-3251, 2006; No 77-3167, 2009) and Paragraph 15 of Article 22 and Paragraphs 1, 4 and 5 of Article 27 of the Law of the Republic of Lithuania on the Government (Valstybės žinios (Official Gazette) No 43-772, 1994; No 41-1131, 1998; No 92-2843, 2000; No 72-2831, 2007; No 117-4442, 2008; No 85-3576, 2009), the Government of the Republic of Lithuania  has resolved:     
1.  to approve the Rules for Drafting and Implementation of Public-Private   Partnership Projects (as appended);
2.  to form the Commission for Public-Private Partnership Projects (hereinafter referred to as “the Commission”):
Chancellor of the Prime Minister (Chairman of the Commission);
Vice-Minister of Finance (Deputy Chairman of the Commission); 
Representative from the Office of the Prime Minister;
Representative from the Ministry of Finance;
Representative from the Ministry of Transport and Communications;
Representative from the Ministry of Economy;
Representative from the Ministry of Justice;
Representative from the Department of Statistics under the Government of the Republic of Lithuania;
Representative from the public institution Central Project Management Agency;  
3.  to establish that the Commission shall submit proposals to the Government of the Republic of Lithuania on the need to implement public-private partnership projects;
4.  to instruct the Commission to approve its Rules of Procedure;
5.  to authorise the Prime Minister to approve the specific composition of the Commission;
6.  to instruct the Ministry of Finance:
6.1. to approve:
6.1.1. the Rules for the Procedure of Submission to the Ministry of Finance of Information on the Progress of Implementation of Public-Private Partnership Projects;
6.1.2. the form of Annual Report on public-private partnership agreements made and implementation thereof;
6.2. to provide technical services to the Commission;
7.  to instruct the Ministry of Finance, the Ministry of Transoprt and Communications, the Ministry of Economy, the Ministry of Justice, the Department of Statistics under the Government of the Republic of Lithuania, and the public institution Central Project Management Agency to delegate representatives to the Commission and to inform the Office of the Prime Minister hereof;
8.  to recommend institutions engaged in the implementation of public-private partnership projects to refer to the public institution Central Project Management Agency with regard to methodological assistance and consultations on drafting and implementation of public-private partnership projects. 
9.  The present Resolution and the Rules for Drafting and Implementation of Public-Private Partnership Projects approved thereby shall not be applied for selection of a strategic investor provided for by the Law of the Republic of Lithuania on the Nuclear Power Plant in accordance with the procedure laid down in the Law of the Republic of Lithuania on Concessions and for awarding a concession to a project implementing company established by the Law of the Republic of Lithuania on the Nuclear Power Plant.    
10.       The present Resolution shall come into force on 1 January 2010.
 
 
 
Prime Minister                                                                                 Andrius Kubilius
 
 
 
Minister of Finance                                                                         Ingrida Šimonytė
 
 
 
 
 
APPROVED by
 
Resolution No 1480 of the Government of the Republic of Lithuania of 11 November 2009
 
 
RULES FOR DRAFTING AND IMPLEMENTATION
OF PUBLIC-PRIVATE PARTNERSHIP PROJECTS
 
 
I. GENERAL PROVISIONS
 
1.  The Rules for Drafting and Implementation of Public-Private Partnership (hereinafter referred to as “partnership”) Projects (hereinafter referred to as “the Rules”) shall regulate the drafting, evaluation, and implementation of partnership projects, the rights, obligations and liability of insitutions engaged in partnership process as well as sharing of risk among the parties of a partnership project. 
2.  The Rules shall be used by public sector entities that have a right to make partnership and concession agreements.
3.  A partnership project that is being implemented as an information society development investment project shall be coordinated with the Information Society Development Committee under the Ministry of Transport and Communications.  
4.  Definitions used in the Rules:
Conclusion of the Ministry of Finance means written evaluation by the Ministry of Finance of financial terms and conditions as well as distribution of risk among the parties of a partnership project, when a project is being implemented on the grounds of public-private partnership, or written approval or disapproval by the Ministry of Finance of the financial conditions of a partnership project, when a project is being implemented by awarding a concession.      
Feasibility study means a detailed technical, financial, economic and institutional analysis of implementation of a partnership investment project.    
Partnership project means an investment project that is being implemented on the grounds of partnerhip.   
Partnership project implementing body means a public entity, when an investment project is being implemented on the grounds of public-private partnerhip, or an awarding authority, when an investment project is being implemented in accordance with a concession contract.  
Partnership agreement means a partnership agreement between a public and a private entity, or a concession contract. 
Procurement means procurement of services and works in compliance with the Law of the Republic of Lithuania on Public Procurement (Valstybės žinios (Official Gazette) No 84-2000, 1996; No 4-102, 2006), when an investment project is being implemented on the grounds of public-private partnerhip, or awarding of a concession in compliance with the Law of the Republic of Lithuania on Concessions (Valstybės žinios (Official Gazette) No 92-2141, 1996; No 70-3163, 2003), when an investment project is being implemented by awarding a concession.   
The other terms used in the Rules are defined in the Law of the Republic of Lithuania on Investments (Valstybės žinios (Official Gazette) No 66-2127, 1999), the Law of the Republic of Lithuania on Concessions, and the Law of the Republic of Lithuania on State Debt (Valstybės žinios (Official Gazette) No 86-2045, 1996; No 83-3041, 2005).
 
 
II. DRAFTING, SUBMISSION, AND EVALUATION OF CENTRAL GOVERNMENT PARTNERSHIP PROJECTS AND MAKING DECISIONS ON PROJECT IMPLEMENTATION 
 
5.  The partnership project implementing body of the central government, having considered priorities listed in its strategic action plans, shall initiate an investment project and draft an investment project feasibility study, which, apart from other investment project implementation options, shall analyse the need for application of partnership for the implementation of an investment project.       
6.  A feasibility study shall provide the following:
6.1. current situation analysis;
6.2. the aim of an investment project;
6.3. data about the activities to be delegated to the private sector and about assets to be newly created and/or transferred in trust for management and use (technical specifications of assets to be newly created, title of assets to be transferred in trust for management and use, legal status of assets, mode of transfer of assets for management and use, etc.);
6.4. analysis of alternative investment project implementation options (modes and duration of implementation; estimated cost-beneft analysis; required funding and investments; proposed funding sources; investment project risk analysis; proposed distribution of risk among the parties of an investment project, based on the Description of Procedure for Distribution of Risk among the Parties of a Public-Private Partnership Project (Anex));
6.5. a recommended option for the implementation of an investment project.
7.  Based on the option for the implementation of an investment project recommended in the feasibility study, the central government  partnership project implementing body shall draft a partnership project that states the following:   
7.1. the aim of the partnership project;
7.2. the chosen mode of partnership;
7.3. justification of the need for the partnership project (expected benefits and socio-economic impact);
7.4. the scope of the partnership project (activities transferred to the private entity in accordance with the partnership agreement and the duration of the partnership agreement; data about assets, required for the implementation of the partnership project, to be newly created and/or transferred in trust for management and use of a private entity);
7.5. estimated value of the partnership project (funds and investments required for implementation of the partnership project and other financial terms and conditions);
7.6. partnership project funding sources, estimated salary paid for the private entity of the partnership project implementing body and payment procedure thereof;
7.7. partnership project risk and data from the proposed distribution of risk among the parties of the partnership project, based on the Description of Procedure for Distribution of Risk among the Parties of a Public-Private Partnership Project (Anex); 
7.8. other terms and conditions of the partnership project, as well as factors substantiating the need for the application of partnership. 
8.  The central government partnership project implementing body shall submit the drafted feasibility study and the partnership project, alongside an application for a Conclusion on the financial terms and conditions and distribution of risk among the parties of the proposed partnership project, to the Ministry of Finance. 
9.  When a central government partnership project implementing body is an institution subordinate to the Seimas of the Republic of Lithuania, the Government of the Republic of Lithuania, or a ministry, it shall coordinate the documents specified in Paragraphs 8, 13, 20, 22, 23, and 24 of the Rules with the Seimas of the Republic of Lithuania, the Government of the Republic of Lithuania, or a ministry.
10. The Ministry of Finance shall evaluate, within its remit, the financial terms and conditions and risk distribution among the parties of the proposed partnership project within 30 working days of the receipt of documents specified in Paragraph 8 of the Rules, and shall issue its Conclusion to the central government partnership project implementing body. The period of 30 working days specified in this paragraph may be extended in consideration of the provisions of Paragraph 12 of the Rules.
11. The Conclusion of the Ministry of Finance shall provide the following:
11.1. financial potencial for the implementation of the partnership project (the ability of the private entity to execute payments);
11.2. acceptability and relevance of risk distribution among the parties of the partnership project; the possible impact of risk on the national financial indicators;
11.3. other data related with the financial terms and conditions of the partnership project and distribution of risk among the parties of the partnership project.
12. The Ministry of Finance shall be entitled to ask the central government partnership project implementing body to provide additional written information (data, documents, etc.), which might condition the Conclusion of the Ministry of Finance. If within 14 working days the central government partnership project implementing body does not provide the information asked, the Ministry of Finance shall not issue its conclusion and shall return the partnership project and the feasibility study to the central government partnership project implementing body that has submitted them. The period of 14 working days specified in this paragraph may be extended in consideration of the request by the central government partnership project implementing body; however, it may not be longer than 28 working days.
13. The central government partnership project implementing body shall submit the Conclusion of the Ministry of Finance, the proposed partnership project, and the feasibility study to the Commission on Public-Private Partnership Projects (hereinafter referred to as the “Commission”). The documents specified in the present paragraph shall not be submitted to the Commission, if a Conclusion of the Ministry of Finance does not approve of the financial terms and conditions of the partnership project, when a partnership project is proposed to be implemented by awarding a concession.
14. The Commission shall examine the documents specified in Paragraph 13 of the Rules and, in accordance wth the procedure laid down in its Regulations, shall submit a proposal to the Government of the Republic of Lithuania on the need for the implementation of the partnership project. The Ministry of Finance shall inform the central government partnership project implementing body about the Commission’s proposal within 5 working days.
15. If the Commission submits a proposal to approve of the need for the implementation of the partnership project, the central government partnership project implementing body shall draft a decision on the implementation of the partnership project, and shall submit it to the Government of the Republic of Lithuania alongside the partnership project, the Commission’s proposal, and the Conclusion of the Ministry of Finance.
16. If the Commission submits a proposal to disapprove of the need for the implementation of the partnership project, or if the Ministry of Finance issues a Conclusion disapproving of the financial terms and conditions of the partnerhip project, when the partnership project is proposed to be implementated by awarding a concession, the partnership project shall not be implemented.  
17. Decision on the implementation of the partnership project shall be made by the Government of the Republic of Lithuania.
18. Decision on the implementation of a partnership project, whereby the State liabilities exceed LTL 200 million, shall be made by the Seimas of the Republic of Lithuania upon the proposal by the Government of the Repubilc of Lithuania.
19. A decision by the Government of the Republic of Lithuania on the implementation of a partnership project shall provide the following:
19.1.  the partnership project implementing body authorised to sign a partnership agreement;  
19.2.  the title and aim of the partnership project;
19.3.  the mode of partnership applied to the partnership project;
19.4.  the scope and maximum value of the partnership project;
19.5.  activities delegated to the private entity;
19.6.  the validity period of the partnership agreement;
19.7.  data about the assets, required for the implementation of the partnership project, to be newly created and/or transferred in trust for management and use to the private entity;
19.8.  other conditions significant for the partnership project.
20. Once the Government of the Republic of Lithuania or the Seimas of the Republic of Lithuania make a decision on the implementation of the partnership project, the central government partnership project implementing body shall execute procurements required for the implementation of the partnership project, draft the partnership agreement and submit it to the Ministry of Finance.
21. The Ministry of Finance shall evaluate, within its remit, the financial terms and conditions as well as distribution of risk among the parties provided in the draft partnership agreement within 30 working days of the receipt of the draft partnership agreement and submit its Conclusion to the central government partnership project implementing body:  
21.1.  when the financial terms and conditions specified in the draft partnership agreement comply with the conditions laid down in the decision on the implementation of the partnership project by the Government of the Republic of Lithuania or the Seimas of the Republic of Lithuania, and data on distribution of risk among the parties of the partnership project comply with the Conclusion of the Ministry of Finance submitted in accordance with Paragraph 10 of the Rules, the Ministry of Finance shall approve of the submitted draft partnership agreement. In this case the central government partnership project implementing body shall sign the partnership agreement with a private entity and shall implement the partnership project;
21.2.  when the financial terms and conditions specified in the draft partnership agreement do not comply with the conditions laid down in the decision on the implementation of the partnership project by the Government of the Republic of Lithuania or the Seimas of the Republic of Lithuania, or data on distribution of risk among the parties of the partnership project do not comply with the Conclusion of the Ministry of Finance submitted in accordance with Paragraph 10 of the Rules, the Ministry of Finance shall, in compliance with Paragraphs 10–12 of the Rules, draft a Conclusion on the modified terms and conditions of the partnership project.
22. The central government partnership project implementing body shall submit the Conclusion of the Ministry of Finance on the modified conditions of the partnership project, alongside the modified partnership project, a document specifying the modified terms and conditions of the partnership project, as well as the reasons that determined modifications, to the Commission, and the latter, in compliance with Paragraph 14 of the Rules, shall submit the proposal to the Government of the Republic of Lithuania.
23. If the Commission submits a proposal to approve of the need for the implementation of the modified partnership project, the central government partnership project implementing body shall draft an amendment to the decision on the implementation of the   partnership project and shall submit it to the Government of the Republic of Lithuania alongside the partnership project, a document specifying the modified terms and conditions of the partnership project as well as the reasons that determined modifications, the Commission proposal, and the Conclusion of the Ministry of Finance. In this case the partnership agreement shall be signed and the partnership project implemented subsequent to an amendment on the decision on the implementation of the partnership project made by the Government of the Republic of Lithuania or the Seimas of the Republic of Lithuania.   
24. If the Commission submits a proposal not to approve of the need for the implementation of the modified partnership project, the central government partnership project implementing body shall submit to the Ministry of Finance a modified draft partnership agreement, which shall be examined in accordance with Paragraphs 21–23 of the Rules, or it shall cancel procurement. 
 
 
III. DRAFTING, SUBMISSION, AND EVALUATION OF LOCAL GOVERNMENT PARTNERSHIP PROJECTS AND MAKING DECISIONS ON PROJECT IMPLEMENTATION
 
25. The local government partnership project implementing body, in compliance with its procedure for initiating or planning of investment projects, shall initiate an investment project and draft a feasibility study for an investment project. The feasibility study, apart from other options for implementation of an investment project, shall analyse the need for the application of partnership for the implementation of an investment project. Requirements laid down in Paragraph 6 of the Rules shall be applicable to the feasibility study of the local government investment project.
26. The local government partnership project implementing body shall draft a partnership project on the basis of the feasibility study in compliance with the provisions laid down in Paragraphs 7.1–7.8 of the Rules.
27. The local government partnership project implementing body shall submit to the Ministry of Finance the feasibility study and the partnership project alongside an application for an opinion on the financial terms and conditions of the proposed partnership project and distribution of risk among the parties of the partnership project.
28. The Ministry of Finance shall evaluate, within its remit, in compliance with the provisions laid down in Paragraph 10 of the Rules, the financial terms and conditions and the data on distribution of risk among the parties provided in the draft partnership agreement and submit its separate opinion to the local government partnership project implementing body.
29. The local government partnership project implementing body shall submit to the municipal council a separate opinion by the Ministry of Finance alongside the proposed partnership project and a draft decision on the need for the implementation of the partnership project. A draft decision on the need for the implementation of the partnership project shall contain data specified in Paragraphs 19.1–19.8 of the Rules.
30. Once the municipal council makes a decision on the implementation of the partnership project, the local government partnership project implementing body shall submit for the approval by the municipal council of the procurement terms and conditions of the partnership project, major terms and conditions of the partnership agreement and the mode of procurement, when the partnership project is being implemented by means of a public-private partnership, or determination of tendering stages, when the partnership project is being implemented by awarding a concession.
31. Once the municipal council approves of the data specified in Paragraph 30 of the Rules, the local government partnership project implementing body shall execute procurement required for the implementation of the partnership project, shall draft a partnership agreement and submit it to the municipal council.
32. If the municipal council approves of the submitted draft partnership agreement, the local government partnership project implementing body shall sign the partnership agreement with a private entity and shall implement the partnership project.
33. If the municipal council rejects the submitted draft partnership agreement, the local government partnership project implementing body shall submit to the municipal council a modified draft partnership agreement or shall cancel procurement.
34. The municipal council shall pass decisions specified in Paragraphs 30, 32, and 33 of the Rules upon receipt of a conclusion by the municipality ombudsman.
 
IV. IMPLEMENTATION OF PARTNERSHIP PROJECTS
 
35. Implementation of the partnership project shall be started once the partnership agreement comes into effect.
36. The partnership project implementing body shall monitor and control implementation of the partnership project.
37. Disputes with regard to implementation of the partnership project shall be settled in compliance with the procedure established by the partnership agreement.   
38. If during the implementation period of a partnership project there arises a need for modification or termination of the signed partnership agreement, the agreement shall be modified or terminated in compliance with the conditions established by the partnership agreement.
 
 
V. RESPONSIBILITY, CONTROL AND ACCOUNTABILITY OF PARTNERSHIP PROJECT IMPLEMENTATION 
 
39. The partnership project implementing body shall be responsible for the following: 
39.1.  initiating investment projects that are eligible for implementation my means of partnership;
39.2.  implementing a feasibility study of a partnership project, drafting a partnership project and a partnership agreement as well as validity of data contained therin;
39.3.  execution of procurements required for the implementation of the partnership project; 
39.4.  drawing of a partnership agreement and honouring the terms and conditions thereof;
39.5.  submission of information on the progress of implementation of partnership projects to the Ministry of Finance.
40. The partnership project implementing body shall submit information on the progress of implementation of a partnership project to the Ministry of Finance in compliance with the Rules for the Procedure of Submission to the Ministry of Finance of Information on the Progress of Implementation of Public-Private Partnership Projects, approved by the Order of the Minister of Finance.  
41. The Ministry of Finance shall:
41.1.  be responsible for the assessment of impact on the state and municipal budget potential of the financial terms and conditions of the partnership project and partnership agreement as well as distribution of risk among the parties of the partnership agreement; assessment of acceptability and  relevance of distribution of risk among the parties of the partnership project and impact on indicators of public finances;
41.2.  gather, systematize, store, and process information on the process of implementation of partnership projects;
41.3.  submit to the Government of the Republic of Lithuania annual reports on public-private partnership agreements and implementation thereof, the form of which shall be approved by the Minister of Finance.
42. Funds required for the implementation of partnership projects shall be planned in compliance with legal acts regulating drafting, approval and implementation of the state and municipal budgets.
 
 
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Annex to
the Rules for Drafting and Implementation
of Public-Private Partnership Projects
 
 
DESCRIPTION OF PROCEDURE FOR DISTRIBUTION OF RISK AMONG THE PARTIES OF THE PUBLIC-PRIVATE PARTNERSHIP PROJECT 
 
 
I . GENERAL PROVISIONS
 
1.  The Description of Procedure for Distribution of Risk among the Parties of the Public-Private Partnership Project (hereinafter referred to as the “Description of Procedure”) shall establish major types of project risk, principles for distribution of risk amog the parties of the partnership project, and an impact of distribution of risk on the indicators of public sector deficit and pubic debt.   
2.  Public sector entities entitled to make partnership agreements shall follow the Description of Procedure while drafting partnership project feasibility studies, partnership projects and partnership agreements.
3.  Definitions used in the Description of Procedure:
Risk means a probability that a certain event might have a negative impact on the implementation of a partnership project.  
Risk distribution matrix means a table indicating an established risk of the partnership project, probability of risk, data about distribution of risk among the parties of the partnership project, and risk management.
Other definitions used in the Description of Procedure shall comply with the definitions used in the Rules for Drafting and Implementation of Public-Private Partnership Projects.  
 
 
II. PRINCIPLES OF DISTRIBUTION OF RISK AMONG THE PARTIES OF THE PARTNERSHIP PROJECT
 
4.  The central principle of distribution of risk is that risk shall be attributed to that party of the partnership project that is able to manage the risk best at the lowest costs.
5.  The risk that cannot be attributed to the single party of the partnership project shall be shared between both parties of the partnership project.
6.  Once the probable risk is established, it shall be distributed among the parties of the partnership project and the risk distribution matrix shall be drawn. Where the risk is attributed to both parties of the partnership project, the risk distribution matrix shall indicate the share each party of the partnership project has assumed.
7.  The risk distribution matrix shall be an integral part of the feasibility study of the investment project, the partnership project, and the partnership agreement.
 
III. MAJOR TYPES OF RISK
 
8.  Major types of risk shall be as follows:
8.1. construction risk means the risk related to events that have an impact on the modifications of value, costs and terms of planning, construction, reconstruction or repairs of the assets to be newly created or transferred in trust for management and use of a private entity, which arise due to the following:
8.1.1. planning errors;
8.1.2. construction delays;
8.1.3. nonconformity of the construction works with the normative requirements and standards;
8.1.4. rise in construction costs;
8.1.5. innacuracies in technical specifications or nonconformity of the project documentation with the aims of the partnership project;
8.1.6. restrictions upon ownership rights to land or other types of property;
8.1.7. restrictions related with archeological and cultural heritage;
8.1.8. special property requirements;
8.1.9. the rise of new technologies or application of new technologies for the implementation of the partnership project;
8.1.10.              negative physical and legal coditions having an impact on the decrease of the value or utility of property;
8.1.11. delay in the issue of summary conditions for the construction planning;
8.1.12. delay in the issue of construction permits;
8.2. availability risk means the risk related to events that have an impact on the provision of services and quality and quantity requirements for services, which arise due to the following:
8.2.1. inability to provide services within the scope established in the partnership project;
8.2.2. inability to provide services in accordance with the quality established in the partnership  project;
8.2.3. nonconformity of the services provided with the safety or other compulsory requirements (hygiene, sanitary, etc.);
8.2.4. the rise in service provision costs;
8.2.5. inadequate employee qualifications of the private service provider;
8.2.6. lack of assets or employees, or inadequacy thereof, required for the provision of services;
8.2.7. technological modifications and errors;
8.2.8. special requirements for the provision of services;
8.3. demand risk means the risk related to events that have an impact on demand for the provision of services, which arise due to the following:
8.3.1. competition;
8.3.2. business cycles;
8.3.3. changes in service price;
8.3.4. technical obsolescence;
8.3.5. new market changes having an impact on the number of service consumers and the price, quality and quantity of servces; 
8.4. political risk means the risk related to events linked with changes in the political environment, which have an impact on the feasibility of the partnership project;
8.5. legal environment risk means the risk related to events linked with changes in legal acts, validity of permits and licences, noncompliance with agreements, and legal proceedings;
8.6. macroeconomic risk means the risk related to events linked with the economic situation of the state: inflation, changes in interest rates, currency exchange fluctuations, rate of economic growth, and demographic and taxing changes;
8.7. price regulation risk means the risk related to events that have an impact on the changes to the procedure for setting service rates, which lead to the changes in the partnership project implementation costs and rights and obligations of the contracting parties;
8.8. income risk means the risk related to events that have an impact on the amount of income received for the provision of services, which arise due to the following:
8.8.1. application of remuneration calculation principles;
8.8.2. setting or modification of charges;
8.8.3. modification of price setting principles;
8.9. force majeure risk means the risk related to events that rise due to circumstances that are impossible to control, reasonably predict, and to prevent the appearance or after-effects thereof;
8.10. dispute settlement risk means the risk related to events linked with conditions making an impact on efficient settlement of disputes;
8.11. environmental risk means the risk related to events that arise due to the following:
8.11.1. non-compliance with environmental requirements or requirements governing the use of natural resources;
8.11.2. environmental damage done while implementing the partnership project;
8.12. asset transfer risk means the risk related to events that arise due to the following:
8.12.1. appropriateness of information about the status of assets to be transferred before assets are transferred in trust for management and use and lack of accessibility to this information;
8.12.2. restriction of property rights while delivering services;
8.12.3. restriction of income from the use of assets;
8.12.4. requirements related to restitution of assets and valuation of assests to be restituted.
9.  The list of risk and events attributed thereto is not exhaustive; the risk distribution matrix shall indicate additional risks and circumstances having an impact on the viability of the partnership project.
 
 
 
IV. IMPACT OF DISTRIBUTION OF RISK AMONG THE PARTIES OF THE PARTNERSHIP PROJECT ON THE INDICATORS OF PULIC SECTOR DEFICT AND DEBT
 
10. The Eurostat (Statistical Office of the European Communities) Decision No 18/2004 of 11 February 2004 on Public and Private Partnerships shall be followed while establishing impact of distribution of risk among the parties of the partnership project, which is being implemented by application of a public-private partnership, on the indicators of pulic sector deficit and debt.
11. Provisions of Paragraph 13 of the Description of Procedure shall not be applied to the distribution of risk among the parties of a partnership project, when the partnership project is being implemented by granting concession. Risk distribution matrix of a partnership project of this type shall lay down, apart from the types of risk listed in Paragraph 8 of the Description of Procedure, all the other risks related with the concession activities and shall evaluate whether the risk distribution is in compliance with the definition of concession established by the Law of the Republic of Lithuania on Concessions, i. e., that the concessionaire shall assume the entire risk, or the greater share thereof, related with the activities pursued.
12. While establishing the impact of distribution of risk of a public-private partnership project between the parties of the public and private entities of the partnership project on the indicators of the public sector deficit and debt, three major types of risk, indicated in the Paragraphs 8.1–8.3 of the Description of Procedure shall be taken into account.
13. The party of a public and private partnership project shall assume the greater share of risk when the type of risk indicated in Paragraph 8.1 of the Description of Procedure (construction risk) and one of the types of risk indicated in Paragraphs 8.2 or 8.3 of the Description of Procedure (availability risk or demand risk) is attributed to this party.
14. When the greater share of risk is attributed to a private entity, the public-private partnership agreement shall be considered to be a performance lease agreement. Assets created or transferred for management or use in compliance with this agreement shall not be listed in the balance sheet of a public entity, and only the amounts payable during the current year shall have an impact on the indicators of the public sector deficit.
15. When the greater share of risk is attributed to a public entity, the public-private partnership agreement shall be considered to be a financial lease agreement. The value of assets created or the increase of the value of assets transferred for management or use in compliance with this agreement shall be listed in the balance sheet of a public entity, and financial obligations assumed by a public entity in compliance with this agreement shall increase the public sector deficit and debt.
16. The impact of distribution of risk on the indicators of the pblic sector deficit and debt shall be evaluated by the Ministry of Finance.
 
 
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