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Public-private partnerships: Unsolicited bid regulations gazetted

Private companies can now approach the state or public enterprises with unsolicited bids for public-private partnerships, but only for projects with an estimated cost of N$10 million.

This follows the gazetting of new guidelines for unsolicited proposals released through the treasury this week.

These guidelines, according to the treasury, provide a structured framework for the submission, evaluation and potential implementation of unsolicited proposals, ensuring that all interested private entities have a fair and equitable opportunity to participate.

The government in 2019 at a public-private partnership (PPP) conference indicated that the state and public enterprises welcomed unsolicited bids through aligned public entities, without much guidance on how they would be approached.

Then executive director of finance and public enterprises Ericah Shafudah said the reason why the Public-Private Partnership Act does not allow the private sector to propose projects to the government was that it would not see fairer competition.

She conceded that although it was restrictive regarding rare and innovative ideas, all ideas should be subjected to competition to a reasonable extent.

Commenting on the aim of the gazetted guidelines, Ministry of Finance and Public Enterprises spokesperson Wilson Shikoto said the ministry aims to encourage innovation, foster competition, and attract private-sector investments to stimulate growth and development.

“The guidelines will enable the government to assess unsolicited proposals effectively and ensure that viable projects are given a chance to proceed,” he said.

The guidelines, as published in Government Gazette number 8091, state that for an unsolicited bid to be considered, it should be in the public interest, and does not entirely depend on the government for funding.

It also states there is no need for direct government guarantee, subsidy or equity.

Furthermore, the regulations indicate there will be protection of intellectual property, and the duty to ensure this lies with the proposing entity.

The minimum criteria for an unsolicited proposal include that such a product has “an element of innovation, either in terms of design or approach in project development and management, leading to a unique and new method of service delivery”.

It is further required that the cost of the proposed project exceeds a threshold project value of N$10 million, and that it is financially viable and has the potential to secure private financing.

A preliminary feasibility assessment not older than three years from the date of submission is also required.

Bids would still be put to the market, with a call for bids from the public, adding a competition aspect to unsolicited bids.

It is mandatory that once an unsolicited bid receives the approval of the preliminary assessment, the public entity that received the bid must, on its website, publish key information about the bid, its evaluation, and its feasibility assessment and procurement.

Fees to review bids start from 0,040% of the estimated capital cost of the proposed project, and increase as the value shoots up.

Key principles guiding the unsolicited bid assessment and evaluation process include public interest, value for money, transparency, affordability, risk allocation, output orientedness, competitive pressure, accountability, and the uniqueness of the project.

The full regulations document can be obtained from the ministry’s website.
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