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Whereby The Legal Regime Of Public Private Partnerships Is Established Organic Standards Dictate Budget And Other Provisions

Original Language Title: Por la cual se establece el régimen jurídico de las Asociaciones Público Privadas, se dictan normas orgánicas de presupuesto y se dictan otras disposiciones

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1508 OF 2012

(January 10)

Official Journal No. 48.308 of 10 January 2012

CONGRESS OF THE REPUBLIC

By which the legal regime of Private Public Associations is established, organic rules of budget are dictated and other provisions are dictated.

Vigency Notes Summary

COLOMBIA CONGRESS

DECRETA:

ARTICLE 1o. DEFINITION. Private Public Associations are a means of linking private capital, which are embodied in a contract between a state entity and a natural or legal person governed by private law, for the provision of public goods. and its related services, which involves the retention and transfer of risks between the parties and payment mechanisms, related to the availability and level of service of the infrastructure and/or service.

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ARTICLE 2o. CONCESSIONS. The concessions in question number 4 in Article 32 of Law 80 of 1993 are included within the Public Private Partnership schemes.

The concessions in force at the time of the enactment of this law will continue to be governed by the rules in force at the time of their conclusion.

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ARTICLE 3o. APPLICATION. This law applies to all contracts in which state entities charge a private investor the design and construction of an infrastructure and its associated services, or its construction, repair, improvement or equipment, activities all of which must involve the operation and maintenance of such infrastructure.

They will also be able to deal with infrastructure for the provision of public services.

In these contracts, the activity with the right to the economic exploitation of that infrastructure or service will be paid, in the conditions that are agreed upon, for the time that is agreed, with contributions from the State when the nature of the project is requires.

The selection processes and rules for the conclusion and execution of contracts that include Public Private Partnership schemes will be governed by the provisions of Law 80 of 1993 and Law 1150 of 2007, except for matters particularly regulated in this law.

PARAGRAFO 1o. Only projects under Private Public Partnership schemes whose investment amount is greater than six thousand (6,000) smmlv can be performed.

PARAGRAFO 2o. Those sectors and entities for which there are special rules governing the linking of private capital for the development of projects shall continue to be governed by such rules or shall give compliance with the provisions of this law, once the particularities applied in those sectors are regulated.

PARAGRAFO 3o. The National Government will be able to regulate the conditions for compliance with availability, service levels, quality standards, guarantee of continuity of service and more consider necessary for the development of the private Public Association schemes referred to in this law, and may apply differential criteria for sectors.

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ARTICLE 4. GENERAL PRINCIPLES. The principles of the administrative, contracting and fiscal sustainability criteria are applicable to private public association schemes.

Private Public Association schemes may be used when in the structuring stage, economic studies or cost analysis benefit or comparative opinions, they demonstrate that they are an efficient or necessary modality for their execution.

These instruments should have an efficient allocation of risks, attributing each of them to the party that is in a better capacity to administer them, seeking to mitigate the impact that the occurrence of the same can generate on the availability of the infrastructure and the quality of the service.

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ARTICLE 5o. RIGHT TO REMUNERATION. 37 of Law 1753 of 2015. The new text is as follows: > The right to the collection of resources for the economic exploitation of the project, to receive disbursements of public resources or to any other remuneration, in projects of public-private partnership, will be conditioned to the availability of the infrastructure, compliance with service levels, and quality standards in the different functional units or stages of the project, and other requirements to be determined by the regulation.

PARAGRAFO 1o. In public-private partnership schemes, contributions in kind may be made by state entities. In any case, such contributions will not compute for the limit provided for in Articles 13, 17 and 18 of this law.

Local and regional governments will be able to apply surplus value for works resulting from public-private partnership projects.

PARAGRAFO 2o. In contracts to execute public-private partnership projects the right to pay for functional units may be agreed upon prior approval by the Ministry or the head of the sector or by whom their times at the territorial level, as long as:

a) The project is fully structured.

b) The project has been structured, contemplating functional units of infrastructure, whose execution could have been carried out and contracted independently and autonomously, and the remuneration will be conditional on the availability of the infrastructure and compliance with quality standards and service standards for the respective functional units.

(c) The other conditions defined by the national government, including the corresponding minimum amount of each functional unit.

PARAGRAFO 3o. Complementary to the provisions of the previous paragraph, in contracts to execute public-private partnership projects, the right to pay in stages, understood by stage, can be agreed of the successive phases in time, as defined in the contract, in which specific functional units are developed or improved, after approval by the Ministry or the head of the sector or who does its own times at the territorial level, provided that:

a) The project is fully structured.

(b) During the initial period of the contract all planned stages shall be executed.

c) The project has been structured in successive stages over time, in accordance with the needs of the service for which a specific scope is defined in the contract and its corresponding service levels and standards quality.

d) The remuneration of the private investor will be conditional on the availability of the infrastructure, to the compliance of quality standards of service.

e) The other conditions defined by the national government, among them the corresponding minimum amount of each stage.

PARAGRAFO 4o. In public-initiative public-private partnership projects of the national order, the competent state entity may recognize real property rights that are not required for the provision of the service for which the project was developed, as a component of the remuneration to the private investor.

The government will regulate the conditions under which the recognition of real and real estate rights will be realized, ensuring that its valuation is in line with its value in the market and the possibilities of exploitation. of the asset. In addition, the conditions that allow the private investor to receive the income from such economic exploitation or disposal, conditioned on the availability of the infrastructure and the performance of the infrastructure, will be included in such regulations. quality standards and agreed service levels.

PARAGRAFO 5o. In the event that in the public-private partnership project the state entity gives to the private investor an existing infrastructure under operating conditions, the state entity may agree to the the right to pay the costs of operating and maintaining this existing infrastructure, conditioned on its availability, compliance with the standards of service and quality standards.

PARAGRAFO 6o. In public-private partnership projects, functional units of sections of tunnels or railway tracks may be established, according to which only partial and standard availability of quality for the purposes of remuneration. The national government will regulate the matter.

Vigency Notes
Previous Legislation
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ARTICLE 6o. PERIOD OF CONTRACTS FOR PRIVATE PUBLIC PARTNERSHIP PROJECTS. The contracts for the implementation of private public partnership projects shall have a maximum period of 30 (30) years, including extensions.

6.1 When financial structuring, and prior to the selection process, results in the project having an execution period exceeding that provided for in the previous subparagraph, private public association contracts may be concluded provided that The National Council for Economic and Social Policy, CONPES, has previously endorsed it.

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ARTICLE 7o. ADDITIONS AND EXTENSIONS OF CONTRACTS FOR PRIVATE PUBLIC PARTNERSHIP PROJECTS. Only additions and extensions relating directly to the subject matter of the contract may be made, after the first three (3) years of its validity and until before the first three quarters (3/ 4) of the original term agreed in the contract.

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ARTICLE 8o. PARTICIPATION OF ENTITIES OF A PUBLIC OR MIXED NATURE. For the conclusion and execution of contracts or interadministrative agreements governed by Law 80 of 1993, 1150 of 2007 and 489 of 1998, which aim to develop private public association schemes, state entities must comply with the structuring, approval and contractual management provided for in this law, without disknowledge of the incompatibilities and incompatibilities provided for in law.

PARAGRAFO. It shall be construed as excluding the scope of this law, the Joint Economic Societies in which the State has a share of less than 50% (50%), its subsidiaries and the Companies between Public Entities with State participation of less than fifty percent (50%), Public Service Companies and Industrial and Commercial Companies of the State when they develop commercial activities in competition with the private and/or public sector, national or international or in markets regulated when they are acting as contractors.

Effective Case-law

TITLE II.

PUBLIC INITIATIVE PRIVATE PUBLIC ASSOCIATION PROJECTS.

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ARTICLE 9o. SELECTION PROCEDURE IN PRIVATE PUBLIC ASSOCIATION PROJECTS OF PUBLIC INITIATIVE. The selection procedure in public private public association projects of public initiative will be established in this law and in the referred to therein shall be governed by the provisions of the General Staff Regulations.

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ARTICLE 10. OPEN OR PRE-QUALIFICATION SYSTEM. For the selection of contractors for public private public association projects, the pre-qualification system may be used, under the conditions laid down in the regulation.

For the pre-qualification system, a pre-qualified list will be formed by public call, establishing a limited group of bidders to participate in the selection process.

The regulation may establish mechanisms to enable additional studies to be carried out or contracted by the pre-qualified.

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ARTICLE 11. REQUIREMENTS FOR OPENING SELECTION PROCESSES FOR CONTRACTORS FOR THE EXECUTION OF PRIVATE PUBLIC ASSOCIATION PROJECTS, OF PUBLIC INITIATIVE. In public private public association projects, the entity that invites to participate in the selection process, you must count before the selection process is started with:

11.1 The current technical, socioeconomic, environmental, pre-dial, financial and legal studies in accordance with the project, the complete description of the project including design, construction, operation, maintenance, organization or exploitation of the project, the detailed and formulated financial model which will base the project's value, detailed description of the phases and duration of the project and justification of the contract period. The state financial model will have legal reserve.

11.2 Evaluation cost benefit of the project analyzing its social, economic and environmental impact on the population directly affected, assessing the expected socioeconomic benefits.

11.3 Justification of using the private public association mechanism as a mode for project execution, in accordance with the parameters defined by the National Planning Department. The analysis indicated in this number must have a favorable prior concept of the National Planning Department or the planning entity of the respective territorial entity. For the above concept, the approval of the Ministry of Finance and Public Credit should be given in respect of the assessments of the contingent obligations of the State Entities, in the development of the Association Schemes. Public Private, in the terms defined in Law 448 of 1998.

11.4 Threat and Vulnerability Analysis to ensure the non-generation or reproduction of disaster risk conditions.

11.5 The appropriate classification, estimation and allocation of risks, possible contingencies, the respective risk matrix associated with the project.

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ARTICLE 12. OBJECTIVE SELECTION FACTORS. In the selection processes that are structured for the execution of public private public association projects of public initiative or that require disbursements of public resources, the objective selection is it will materialize by selecting the most favorable offer to the entity and the purposes that it seeks.

The choice and rating factors to be established by the entities in the terms or their equivalents in these contracts shall take into account the following criteria:

12.1 The legal capacity, financial or financing capacity and experience in investment or project structuring will be the subject of documentary verification of compliance by state entities as requirements They will be available for participation in the selection process and will not score. In such cases, no Single Register of Proposers will be required and the presentation of this documentation will be subsable, in the terms set out in the General Staff Regulations.

12.2 The most favourable offer will be that which, taking into account the technical and economic factors of choice and the precise and detailed weighting of the same, contained in the specifications or their equivalents, represents the best the offer or the best cost-benefit ratio for the entity, without the favorability being different factors than those contained in those documents. Within such criteria, institutions may consider the levels of service and quality standards, the present value of the expected income, the lower state contributions or greater contribution to the State as the case may be, in consideration given to the offeror, except in the case of regulated contracts or fees to be charged to users, inter alia, in accordance with the nature of the contract.

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ARTICLE 13. ADDITIONS AND EXTENSIONS OF CONTRACTS FOR PRIVATE PUBLIC ASSOCIATION PROJECTS OF PUBLIC INITIATIVE. In contracts for the execution of private public association projects of public initiative, the additions of resources of the budget General of the Nation, territorial entities or other public funds to the project will not be able to exceed 20% of the value of the contract originally agreed. In such contracts, extensions in time shall be valued by the competent State entity. Requests for resource additions and the value of carryovers in time shall not exceed 20% of the value of the contract originally agreed.

The value of the contract for these purposes must be expressly determined in the contract, and be based on the estimated investment budget or the criteria to be established in the case of projects for the provision of public services.

All investments that do not involve disbursements of public resources, nor modifications in time may be made by the executor of the project on his own account and risk, without compromising or generating any obligation of the entity state competent to recognise, compensate or repay such investment. In any event, such investments must be previously authorized by the competent entity when they involve a modification of the terms of the contract initially agreed and comply with the requirements required by Law 448 1998 that are applicable to them.

TITLE III.

OF PRIVATE PRIVATE INITIATIVE PUBLIC ASSOCIATION PROJECTS.

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ARTICLE 14. STRUCTURING OF PROJECTS BY PRIVATE AGENTS. Individuals may structure projects of public infrastructure or the provision of their associated services, on their own account and risk, assuming all the costs of the structure, and present them in a confidential manner and subject to consideration by the competent State entities.

The process of structuring the project by private agents will be divided into two (2) stages, one of prefeasibility and one of feasibility.

In the pre-feasibility stage the originator of the proposal should clearly state the complete description of the project including the minimum design in pre-feasibility stage, construction, operation, maintenance, organization and operation of the project. Project scope, pre-feasibility stage demand studies, project specifications, estimated cost and source of funding.

For the feasibility stage, the initiative for the realization of the project must understand: the detailed and formulated financial model that will base the value of the project, detailed description of the phases and duration of the project, justification the contract period, risk analysis associated with the project, environmental, economic and social impact studies, and technical, economic, environmental, pre-dial, financial and legal feasibility studies for the project.

In the feasibility stage, the originator of the project must annex the documents that credit its legal, financial or potential capacity for financing, investment experience or project structuring or to develop the project. project, the value of the structuring of the project and a minute of the contract to celebrate that includes among others, the proposal of risk distribution.

At this stage you will have to certify that the information you deliver is true and it is all that you have about the project. This certification shall be submitted by a sworn statement.

No initiatives may be presented in cases where they correspond to a project that, at the time of its presentation, modify existing contracts or concessions or for which its structuring by any entity has been advanced. state. Nor will those initiatives that demand State guarantees or disbursements of resources from the General Budget of the Nation, territorial entities, or other public funds, higher than those established in this law, be accepted.

When there are several originators for the same project, the first one to submit an offer to the competent state entity will have priority for its study and subsequently declared by the competent state entity as viable.

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ARTICLE 15. PRIOR REVIEW OF THE PRIVATE INITIATIVE. The initiative of the pre-feasibility stage project will be submitted, the competent state entity will have a maximum period of three (3) months to verify if the proposal, when it is analyzed, is of interest of the competent entity in accordance with the sectoral policies, the prioritization of projects to be developed and that this proposal contains the elements that allow it to infer that the same one can become viable, without such verification generates no rights to the individual, no obligation for the State.

Result of this verification, the competent state entity may reject the initiative or grant its favorable concept for the originator of the proposal to continue with the structuring of the project and initiate the feasibility stage. This concept, if favourable, will allow the originator of the proposal to continue with the structuring of the project and to carry out further studies, without creating a commitment to accept the project or any obligation of any order for the State.

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ARTICLE 16. ASSESSMENT, ACCEPTANCE OR REJECTION OF THE PRIVATE INITIATIVE. The initiative of the project in feasibility stage, the competent state entity shall have a maximum period of six (6) months from the date of its radication, for the Evaluation of the proposal and the consultations with third parties and competent authorities, this study may be done directly or through third parties. The terms of the study may be extended for up to half of the initial period, in order to deepen their research or ask the originator of the project to develop additional or complementary studies, adjustments or clarifications to the project.

If the relevant studies are carried out by the competent public entity, it considers the initiative to be viable and in line with public interests and policies, it will inform the originator informing him of the conditions for the acceptance of his initiative. including the amount that it accepts as the value of the studies carried out, based on costs demonstrated in market rates for the structuring of the project and the conditions of the contract. Otherwise it will reject the initiative by means of a duly motivated administrative act. In any case, the presentation of the initiative does not generate any rights for the individual, nor any obligation for the State.

If the initiative is rejected, the property on the studies will be from the originator, but the public entity will have the option to acquire those inputs or studies that interest it or are useful for the purposes of the public function.

Communicated the feasibility of the initiative, the originator of the project may accept the conditions of the competent state entity or propose alternatives. In any event, within a period of not more than two (2) months counted from the feasibility notice, if no agreement is reached, the project shall be deemed to have been denied by the public entity.

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ARTICLE 17. PRIVATE INITIATIVES REQUIRING DISBURSEMENTS OF PUBLIC RESOURCES. 38 of Law 1753 of 2015. The new text is as follows: > Lograd the agreement between the competent state entity and the originator of the initiative, but requiring the execution of the project disbursements of public resources, will open a public tender to select the the contractor that the project that the originator has proposed, process of selection in which the one who presented the initiative will have a bonus in its qualification between 3 and 10% on its initial qualification, depending on the size and complexity of the project, to compensate for its previous activity, in terms of the regulation.

In this class of public-private partnership projects, the resources of the General Budget of the Nation, of the territorial entities or of other public funds, will not be able to exceed 30% of the estimated investment budget of the project. In the case of road infrastructure projects, this percentage may not exceed 20% of the estimated investment budget of the project.

If the originator is not selected for the execution of the contract, the value that the competent public entity has determined, prior to the tender, as costs of the studies performed for the contract, must be received from the successful tenderer. structure of the project.

In all cases the competent state entity must comply with the requirements set out in Article 11, numerals 11.2 and below of this law.

Vigency Notes
Previous Legislation
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ARTICLE 18. ADDITIONS AND EXTENSIONS OF CONTRACTS FOR PRIVATE PRIVATE INITIATIVE PUBLIC ASSOCIATION PROJECTS REQUIRING DISBURSEMENTS OF PUBLIC RESOURCES. In contracts for the implementation of private public partnership projects of initiative The funds will not be able to exceed 20 percent of the public funds ' disbursements. originally agreed. In such contracts, extensions in time shall be valued by the competent State entity. Requests for resource additions and the value of carryovers in time shall not exceed 20% of the disbursements of the originally agreed public resources.

All investments that do not involve disbursements of public resources, nor modifications in time may be made by the executor of the project on his own account and risk, without compromising or generating any obligation of the entity state competent to recognise, compensate or repay such investment. In any event, such investments must be previously authorized by the competent entity when they involve a modification of the terms of the contract initially agreed and comply with the requirements required by Law 448 1998 that are applicable to them.

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ARTICLE 19. PRIVATE INITIATIVES THAT DO NOT REQUIRE DISBURSEMENTS OF PUBLIC RESOURCES. Lograd the agreement between the competent state entity and the originator of the project, keeping the originator the condition of not requiring resources from the General Budget of the Nation, territorial entities or other public funds for the implementation of the project, the competent entity shall publish the agreement, the studies and the minute of the contract and its annexes for a term not less than one (1) month and not more than six (6) months, in terms of the regulation, depending on the complexity of the project, on the Electronic System for Public Procurement website "SECOP".

In this publication, the competent state entity shall indicate the conditions to be met by any interested parties involved in the execution of the project and shall announce its intention to award a contract to the originator agreed conditions, if there is no other interested party in the implementation of the project.

After the deadline of the publication referred to above, without any interested party other than the originator of the project to express to the competent state entity, its interest to execute it or to fulfil the conditions to participate in its execution, may be contracted with the originator, in a direct manner in the agreed conditions.

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ARTICLE 20. INTERESTED THIRD PARTIES AND SELECTION. If a third party manifests its interest in executing the project, in the agreed conditions between the competent state entity and the originator of the project, maintaining the condition of not requiring resources of the General Budget of the Nation, of the territorial entities or other public funds for the execution of the project, must manifest it and guarantee the presentation of the initiative through an insurance policy, a bank guarantee or other means authorised by law, by crediting its legal, financial or potential financing capacity, experience in investment or project structuring to develop the agreed project.

In this case, the entity must open a process using the methodology established for the lower-value short-selection processes with prequalification, for the selection of the contractor between the originator of the project and the suppliers who have annexed security for the submission of their tenders and fulfil the conditions for their implementation.

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If as a result of the selection process the project originator does not present the best offer, according to the established evaluation criteria, the latter will have the right to present an offer that improves the proposal of the proposer better qualified, within a maximum period of (10) ten working days from the publication of the evaluation report of the proposals. If the originator improves the offer, the contract shall be awarded once the requirements laid down in this law are met.

Effective Case-law

If the originator is not selected for the execution of the contract, the value that the competent state entity has accepted must be received from the successful tenderer, as the cost of the studies carried out for the structuring of the project.

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ARTICLE 21. ADDITIONS AND EXTENSIONS OF CONTRACTS FOR PRIVATE PRIVATE INITIATIVE PUBLIC ASSOCIATION PROJECTS THAT DO NOT REQUIRE DISBURSEMENTS OF PUBLIC RESOURCES. Contracts for the implementation of private public partnership projects In the case of a private sector in which the disbursement of resources of the General Budget of the Nation, territorial entities or other funds has not been agreed upon in the contract, they may not be subject to modifications involving the disbursement of this type of resources and may be extended for up to 20% of the initial period.

All investments that do not involve disbursements of public resources, nor modifications in time may be made by the executor of the project on his own account and risk, without compromising or generating any obligation of the entity state competent to recognise, compensate or repay such investment. In any event, such investments must be previously authorized by the competent entity when they involve a modification of the terms of the contract initially agreed and comply with the requirements required by Law 448 1998 that are applicable to them.

TITLE IV.

COMMON PROVISIONS OF PRIVATE PUBLIC ASSOCIATION PROJECTS.

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ARTICLE 22. CLAUSES SPECIFIC TO ADMINISTRATIVE CONTRACTS. Contracts for the development of Private Public Partnership projects shall include the exceptional clauses, which are specific to public procurement such as that of revocation, termination unilateral and the other established in the law.

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ARTICLE 23. IDENTIFICATION OF THE ACTUAL BENEFICIARY OF THE CONTRACT AND THE SOURCE OF THE RESOURCES. Proposers participating in pre-qualification processes referred to in Article 10 of this Law and in general, in selection processes for the development of Public Private Partnership schemes, they must present a sworn statement in which they fully identify natural or legal persons who are beneficiaries in a personal or direct way in case to be successful in the future contract, as well as the origin of its resources. The above in order to prevent activities or asset laundering operations.

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ARTICLE 24. AUTONOMOUS HERITAGE. The public resources and all the resources that are managed in the project must be managed through an autonomous patrimony constituted by the contractor, consisting of all the assets and liabilities present and future linked to the project. The State entity shall have the power to require the information it deems necessary, which must be delivered directly to the applicant by the administrator of the autonomous patrimony, within the time limits and terms established in the contract. The returns on private resources in the autonomous heritage belong to the project.

PARAGRAFO. Constituted the autonomous patrimony, within three (3) business days of the following, the fiduciary shall report to the Financial Analysis and Information Unit "UIAF" the name of the beneficiary, the value of the resources administered through the autonomous patrimony constituted by the contractor and the other information that this Unit requires.

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ARTICLE 25. SINGLE REGISTER OF PRIVATE PUBLIC ASSOCIATION, RUAPP. The National Planning Department will administer and regulate the operation of the Single Register of Private Public Partnership, RUAPP, which will be published and will be incorporated into the projects that the National Government or the territorial entities consider to be a priority, the projects of Public Private Partnership in the process both at national and territorial level, its state of development, the projects of Public Private Partnership that have been rejected.

The territorial entities must inform the RUAPP of the initiatives they wish to develop, those that are being processed or implemented in their territory.

Editor Notes
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ARTICLE 26. FUTURE VIGENCIES OF THE NATION AND THE STATE ENTITIES OF THE NATIONAL ORDER FOR PRIVATE PUBLIC ASSOCIATION PROJECTS. For the contracts referred to in this law, the CONIS, prior to the favorable concept of the Ministry of the The National Planning Department and the National Investment Project Bank, BPIN, will be able to authorize the assumption of commitments of future vigencies, up to the duration of the project. Each year, at the time of approval of the primary surplus target for the non-financial public sector consistent with the macroeconomic program, the National Council for Economic and Social Policy CONPES, prior to the Fiscal Policy Council CONIS, will define the annual limit of authorizations to commit these future vigencies for Private Public Association Projects.

The CONIS will define a fiscal consistency scenario according to the nature of each project and will carry out the evaluation of the budget contribution and the provision of public resources.

The Ministry of Finance and Public Credit will have no objection to the financial conditions and the contractual clauses that govern the same, proposed by the competent state entity.

241 of Law 1753 of 2015. The new text is as follows: > The tax guarantee issued by the Confis for the implementation of a public-private partnership project (PPP) in which the contract is not properly perfected, will not be subject to reconsideration of the Confis when it is exceeds 10% of the initially approved value. However, in exceptional cases at the request of the Minister of the Industry, on the basis of motivation and justification by the head of the requesting entity, the Trust may evaluate a new proposal for the project in the terms set out in this Article. law.

Vigency Notes
Previous Legislation

The future vigencies to protect the Nation's Private Public Association projects are not public credit operations, they will be budgeted as investment expenses.

The resources generated by the operation of the infrastructure or the provision of public services in the development of Public Private Partnership Projects will not be counted in the General Budget of the Nation, during the execution of the project. of the contract.

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ARTICLE 27. REQUIREMENTS FOR PRIVATE PUBLIC ASSOCIATION PROJECTS THAT REQUIRE DISBURSEMENTS OF PUBLIC RESOURCES IN TERRITORIAL ENTITIES. In territorial entities, the development of these types of projects will also be governed by the following rules:

1. For the subscription of the contracts referred to in this law, the territorial entity shall accredit the compliance with the limits of expenditure and debt established in Law 358 of 1997, 617 of 2000 and 819 of 2003, and the requirements defined in the 1998 448 Act on Risk Approval and Contingent Liabilities. In those cases where the contracts are co-financed by the Nation, the previous and favorable concept of the National Planning Department will also be required.

2. For all intents and purposes, future revenues committed in this type of contract will affect the payment capacity defined in Law 358 of 1997 and the rules that modify and supplement it.

3. The territorial entity shall identify the source of financing of the contract in such a way that the current income committed in the financing of the contract shall be discounted from the current income used to calculate the ability to pay, as set out in Act 358 of 1997. The credit resources that may be required to finance the committed future vigencies will be added to the debt balance that determines the payment capacity indicators, as set out in Law 358 1997.

4. When the project is financed from the current income of free destination, the same, they cannot be considered as freely available in the terms of Law 617 of 2000.

5. Only private public partnership projects, consistent with the objectives of the territorial development plans, can be developed.

6. This type of contract cannot be concluded during the last year of the government.

7. The future vigencies to be issued shall comply with the applicable rules governing the subject matter and the parameters provided for in this Article.

PARAGRAFO 1o. Contracts to be concluded under this law must be registered with the Ministry of Finance and Public Credit and reported in the Single Territorial Form, FUT, and the Single Register of Private Public Association, RUAPP.

PARAGRAFO 2o. For the presentation of these projects to the Ministry of Finance and Public Credit, the financial validation of one of the public financial institutions of the second floor or the structure of the structure public.

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ARTICLE 28. BUDGET OF THE STATE SOCIAL ENTERPRISES. The Social Enterprises of the State that in the development of this law will conclude contracts under schemes of Private Public Associations, will draw up their annual budgets based on the collection cash made in the year immediately preceding the one that the updated budget is drawn up according to the expected inflation of that year and up to 20% of the outstanding portfolio to be raised from previous vigencies. Other Social Enterprises in the State will draw up their annual budgets based on the cash collected in the year immediately before the budget is drawn up updated according to expected inflation of that year. The above, without prejudice, in both cases, of the adjustments that proceed to the budget according to the actual collection evidenced in the validity in which the budget.

Effective Case-law
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ARTICLE 29. FEE FOR ADDITION OR EXTENSION. The executor of the project once perfected and concluded the contract that materializes the Public Private Partnership scheme, at the time of making an application for the addition or extension of the contract must pay a the rate corresponding to ten (10) per cent of the value requested if it is an addition to the contract or one (1) per cent of the initially agreed value when it is an extension of the value, as a consideration for the studies it owes to advance the Ministry of Finance and Public Credit to make the application process.

In case the application corresponds to a project that has previously been submitted to the National Council for Economic and Social Policy-CONPES, the corresponding fee will be reduced to (2%) two percent of the requested value, if an addition to the contract.

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ARTICLE 30. ASSUMPTION OF THE CONTRACT. In the event of a breach of the contractor, the funders may continue the execution of the contract until their termination directly or through third parties.

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ARTICLE 31. SUPPLY OF GOODS. In contracts for the execution of Public Private Partnership Projects, the movable and immovable property of the State or of the individuals, affected by the provision of the service or the execution of the project, which will reverse the state to the termination of the contract and the conditions in which they will do so.

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ARTICLE 32. EARLY TERMINATION AGREEMENT. In contracts that develop Private Public Partnership Projects, a clause will be included in which the mathematical formula will be established to determine the eventual reciprocal benefits between the parties to which there is a place for the purpose of terminating them in advance by mutual agreement or unilaterally.

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ARTICLE 33. CONTRACTS FOR THE PREPARATION OF STUDIES, THE EVALUATION OF PRIVATE INITIATIVE PROJECTS AND THE INTERVENTORIES. The preparation of studies, the evaluation of projects of private initiative and the interventories of the contracts, may be contracted by means of the short-selection procedure of a small amount or a minimum amount according to its value.

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In contracts for the execution of private public association projects, the financial controller must be hired with a person independent of the contracting entity and the contractor. Such financial controllers shall respond to civil, fiscal, criminal and disciplinary action, both for the fulfilment of the obligations arising out of the contract of sale, and for the acts or omissions which are imputable to them and cause damage or damage to the entities, arising from the conclusion and execution of contracts in respect of which they have exercised or exercised the functions of the financial controller.

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ARTICLE 34. CONTRACTS IN FORCE. At least two (2) years before the end of the concession contracts in force for the issuance of this law or for the contracts of Private Public Association to be concluded, the contracting public entity prepare the study that will allow him to make the decision to initiate the bidding process for the conclusion of a new contract or to allow the project to revert to the nation.

In the variable term contracts the controller or supervisor shall estimate the tentative end date and inform the state entity when it can be expected that the contract will terminate two (2) years before.

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ARTICLE 35. FOLLOW-UP SUBCOMMITTEE. Create a sub-committee composed of one (1) Senator and one (1) Representative of the Quarters and one (1) Senator and one (1) Representative of the Sexual Commissions of the Congress of the Republic, for the purpose of follow up to the rules of the present draft law. The Director of National Planning shall convene the Commission every three (3) months. Within the annual report submitted by the National Department of Planning to the Congress of the Republic, a specific act on progress in the implementation of this law will be incorporated.

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ARTICLE 36. ORGANIC RULES. <Article corrected by Article 1 of Decree 2294 of 2012. The new text is as follows: > Are budget organic rules included in items 26, 27 , and 28.

Vigency Notes
Previous Legislation
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ARTICLE 37. PROJECT MANAGEMENT. Public and private entities that perform private public partnerships under this law will be able to administer private public partnership projects through the Institutes of Public Works and Regional Development "INFIS".

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ARTICLE 38. The territorial governments will develop and maintain duly updated technical inventories of public works of interest to develop in the short, medium and long term. Individuals may invest at their own risk in studies and designs on the works of these inventories in the terms of this law.

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ARTICLE 39. VIGENCIES AND DEROGATIONS. This law repeals all provisions that are contrary to it, in particular paragraph 2 of Article 32 of Law 80 of 1993 and article 28 of Act 1150 of 2007.

The President of the honorable Senate of the Republic,

JUAN MANUEL CORZO ROMAN.

The Secretary General of the honorable Senate of the Republic,

EMILIO RAMON OTERO DAJUD.

The President of the honorable House of Representatives,

SIMON GAVIRIA MUNOZ.

The Secretary General of the honorable House of Representatives,

JESUS ALFONSO RODRIGUEZ CAMARGO.

COLOMBIA-NATIONAL GOVERNMENT

Publish and comply.

Dada in Bogotá, D. C., on January 10, 2012.

JUAN MANUEL SANTOS CALDERÓN

The Minister of Finance and Public Credit,

JUAN CARLOS ECHEVERRY GARZON.

The Minister of Transport,

GERMAN CARDONA GUTIERREZ.

The Director of the National Planning Department,

HERNANDO JOSE GOMEZ RESTREPO.

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