Kenya has stable PPP
legal and regulatory framework which comprises of the Constitution of Kenya
2010, the Public Private Partnership Act Cap 430, the Public Procurement and
Assets Disposal Act ,2015, court rulings, regulations, guidelines and tribunal
determination
The Public Private
Partnership Act Cap 430 under section 37 provides procurement methods which a
contracting authority may procure a Public Private Partnership Project.
A Public private
partnership may be initiated through:
- Direct
procurement. (Section 38)
- Privately initiated proposals (Section 40)
- Competitive
bidding (Section 46)
- Restricted
bidding (Section 45)
DIRECT PROCUREMENT.
A contracting
authority in consultation with the directorate may use direct procurement if
the conditions under section 38 are satisfied inter alia: the private party
possesses the intellectual property rights to the key approaches or
technologies required for the project, the works and services are only
available from a limited number of private parties etc.
A contracting
authority is required to:
- Issue
a tender document which shall be the basis of the tender preparation by the
contracting authority and subsequent negotiations
- Appoint
an evaluation committee in accordance to the Act for negotiation of a direct
procurement of a project.
- Ensure
appropriate approvals under this Act have been granted;
- Ensure
that the resulting project agreement complies with this act;
PRIVATE- INITIATED PROPOSALS
A private party may
submit a privately initiated proposal to a contracting authority.
A contracting
authority may consider the privately initiated proposal submitted if:
- The
project is aligned with the national infrastructure priorities and a demonstrated
societal need.
- The
project provides value for money;
- The
project proposal provides sufficient information for the contracting authority
to assess fiscal affordability and the potential contingent liability
implication of the proposal;
- The
project can be delivered at a fair market price;
- The
project is supported by all documents
- The project supports the efficient transfer of risk from the public sector
- The
contracting authority shall submit the privately initiated proposal to the
directorate
The directorate and
the contracting authority upon evaluation of the privately initiated proposal,
may or may not approve the private-initiated proposal. Such approval however
shall not create an obligation on the part of the directorate, contracting authority
or the government towards the private party.
RESTRICTED BIDDING
A contracting
authority may use restrictive bidding if any of the following conditions are
satisfied:
- Competition
for contract, because of the complex or specialized nature of the works and
services is restricted to prequalified tenderers;
- The
time and costs required to examine and evaluate a large number of tenders would
be disproportionate to the value of the works or services procured.
- If
there is evidence to the effect that there are only a few known suppliers of
the whole market of the works or services;
- An
advertisement is place where applicable on the procuring entity website
regarding the intention to procure through limited tender.
COMPETITIVE BIDDING
A contracting
authority shall on approval of a feasibility report, invite requests for
qualifications from qualified bidders with respect to the proposed project.
A contracting
authority shall specify the eligibility criteria of a bidder and may require
each bidder to provide statements or documents to prove the bidder’s
eligibility.
A private party
intending to respond to a request for qualification under competitive bidding
may do so as part of the consortium of the private parties.
A private party is
eligible to respond to a request for qualification if the party:
- Satisfies
the criterial specified in the request for qualification issued by the
contracting authority.
- Has
the technical and financial capacity to undertake he proposed project;
- Has
the legal capacity to enter into a project agreement with the contracting
authority;
- Is
not insolvent, in receivership, bankrupt or in the process of being wound up.
The contracting
authority shall upon issuing a notice constitute a pre-qualifying committee for
the purpose of pre-qualifying bidders.
A bidder may be
disqualified at the pre-qualification stage if they provide false, inaccurate
or incomplete information, colludes, connives and is involved in any corrupt or
any dishonest practice intended to confirm unfair advantage over other bidders.
After pre-qualification
and short listing of pre-qualified bidders, the contracting authority shall
prepare tender documents in relation to a project for the purpose of inviting
bids from eligible bidders.
A bidder intending to
bid shall complete and submit a technical and financial bid. Upon evaluation of
the bids the evaluation team may reject a bidder’s submissions where the bidder
fails to comply with the conditions specified in the tender documents.
A bidder whose bid
has been rejected under section shall not be entitled compensation
On approval of the
project, the contracting authority shall notify in writing all bidders of their
decision.
The contracting
authority shall then proceed to execute the project agreement, and the private
party shall be required to commence the project within 12 months.
The contracting
authority reserves the right to cancel a tender process at any time before the
execution of the project agreement if it is in the public interest to do so.
Prepared by:
PATRICKS LAW ASSOCIATES
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Written by Bridget Inyanje