Removing obstacles in attracting investment through public-private partnerships in the city. Ho Chi Minh

On April 24, the Vietnam International Arbitration Center (VIAC) coordinated with the Ho Chi Minh City Investment and Trade Promotion Center (ITPC) to organize the Plenary Session of the Investment Legal Support Forum 2024 – Part 1 “Investment in the form of public-private partnerships in the new context of the City. Ho Chi Minh”. The forum was attended by representatives of many agencies and departments and nearly 200 delegates who are investors, business associations, experts in the field and news agencies.

Opening speech, Dr. Tran Du Lich – Vice Chairman of the Vietnam International Arbitration Center (VIAC), Chairman of the Advisory Council for the Implementation of Resolution 98 provided some general information about the progress of implementing Resolution 98/ 2023/QH15, especially for the implementation of PPP projects (public-private partnership projects) in Ho Chi Minh City.

Accordingly, up to now, the City has called for 54 investment projects in the form of PPP (41 projects in the fields of culture, sports, and health according to Resolution 181/NQ-HDND; 05 projects BOT project for existing road traffic projects; 08 other projects in the fields of education and sports have just been called for investment capital by Thu Duc City on April 17). The city also makes great efforts to implement the regulations in Resolution 98 in implementing PPP projects in the city. However, it can be seen that the process of calling for and implementing PPP projects is facing some problems such as lack of specific instructions as well as issues related to the suitability of the PPP form for some projects. judgment.

Opening the Plenary Session, Mr. Ngo Thanh Tung – Lawyer member of Hong Duc International Law Firm (VILAF) commented that with the benefits that PPP brings, Vietnam is one of the countries that has been following Pursue PPP as a strategic option to mobilize private investment and improve public service delivery. However, the implementation of PPP in Vietnam faces many difficulties and obstacles, leading to a low number of successful projects and the private economic sector is still cautious, especially investors with real potential. want to seriously participate. One of the main challenges in implementing PPPs in developing countries is the lack of clear and consistent legal and regulatory frameworks defining the roles, responsibilities and rights of public and private partners, as well as such as procedures, criteria and mechanisms for selection, appraisal, approval, procurement, contract management, project monitoring and evaluation.

In addition, the issue of institutional capacity and human resources of the public sector is also a factor that hinders the success of PPP projects. Thus, to improve the situation, overcome these challenges and seize the opportunities of PPP projects in social fields, the Government, the public sector and the private sector need to apply a number of measures. specific measures, such as developing and applying appropriate methodologies and indicators, engaging and consulting with stakeholders, providing financial and non-financial incentives and support, integrating and Adjust PPP projects in social fields with national and local development plans and strategies, ensuring transparency and accountability of PPP projects in social areas.

Regarding the issue of “Choosing the type of PPP contract and requirements for protecting investors’ interests during the implementation of PPP projects”, Ms. Nguyen Thi Linh Giang – Chief of PPP Office, Department of Bidding Management – Ministry Planning and Investment said that since the PPP Law was introduced and took effect in 2021, a total of 36 projects have been implemented in the form of PPP, of which the majority of projects are implemented in the form of contracts. BOT contracts (28/36 projects), the remaining projects are implemented in the form of BLT, BOO and 01 project is implemented in the form of O&M contract. This can confirm the investor’s preference when choosing this type of contract. At the same time, it also affirmed the need to have a model contract aimed at harmonizing the relationship between the parties on the principle of balancing interests between the public and private sectors. However, the question is how to build a model contract to suit each field, corresponding to the needs of each industry. Only then can the model contract be fully effective – is a tool to clarify rights, benefits, and obligations, create a basis to prevent risks, and develop effective handling plans for each case.

For her part, Ms. Luong Thi Thanh Ngan – Representative of the Asian Development Bank (ADB), Senior Private Investment Expert shared that the failure of PPP projects occurs at many stages and is caused by There are many objective and subjective reasons, therefore, before calling for bidding or making investment decisions, the State as well as investors need to have correct assessments and judgments about project characteristics, implementation feasibility. Notably, not all projects in the current list can implement PPP. There are projects where, if PPP is applied, both the State and investors will have to bear losses; Meanwhile, there are projects with great potential and if PPP is applied, they will bring very high efficiency.

LS’s share. Nirmalan Amirthanesan – Lawyer at Mori Hamada & Matsumoto Law Firm commented that not only the PPP law but also many specialized laws and a number of guiding decrees and circulars have provided regulations on the risk allocation mechanism between Investors. and government. Practice shows that issues of risk sharing mechanisms in particular and other regulations are standardized by the parties in PPP projects by including them in the contract. In some countries around the world, these regulations are even included in model contracts and detailed regulations. And in Vietnam, the parties should also apply ways to balance interests, especially the State and Investors need to have commitments in the contract and be jointly responsible for contract management. Along with that, to minimize risks for investors and strengthen their role, the Government and agencies also need to pay more attention to improving the legal regulatory system; Especially pay more attention to building model contracts.

Sharing the same opinion as above, Associate Professor. Dr. Duong Dang Hue – Vice Chairman of the Business Legal Club, Former Director of the Civil – Economic Law Department, Ministry of Justice, VIAC Arbitrator shared, the current PPP Law has many unclear regulations. , overlap, contradict and cause inadequacy when applied in practice. For investors, these shortcomings have caused them to suffer many disadvantages, losing the balance of rights and interests with state agencies when implementing projects. Some typical shortcomings that can be mentioned are that there are no regulations on the state’s responsibility when violating contractual obligations; The mechanism for risk-profit distribution is not really fair and is time-consuming for investors; Investors are not provided with favorable conditions in the management and business of PPP projects…

From practical assessments and analysis, Associate Professor, PhD. Hue also made a number of recommendations to improve legal regulations, enhance the role and protect investors more. Specifically, experts recommend that the National Assembly needs to carry out activities to supervise the implementation of the PPP Law and while it has not yet promptly amended and supplemented the Law and guiding Decrees and Circulars, it is necessary to research, draft and approve. Issuing sample PPP project contracts. In addition, relevant agencies and departments also need to continuously synthesize problems and shortcomings to accompany investors and promptly resolve their problems. Only then will the PPP project attract new investment sources, have more improvements and be implemented more effectively.

After the professional report, the Dialogue between the Working Group and the Forum Professional Group took place with the coordination of the LS. Ngo Thanh Tung – Lawyer member of Hong Duc International Law Firm (VILAF), VIAC Arbitrator. In this part of the dialogue, opinions from the Preparatory Session and the Plenary Session were debated; From there, it leads to final conclusions and specific recommendations for issues that arise during the process of calling for and implementing PPP projects in Ho Chi Minh City.

Speaking in conclusion, Dr. Vu Tien Loc – National Assembly Delegate, Chairman of the Vietnam International Arbitration Center (VIAC) emphasized that the Forum has recorded all opinions and contributions from diverse audiences throughout the Preparatory Session and Plenary Session. This shows that the topic of PPP is currently an important and “hot” issue in Ho Chi Minh City. Based on these opinions, the Forum will produce a final summary report and detailed and feasible recommendations to the City to help local government agencies call for investment effectively and at the same time. Helps investors feel more secure when deciding to accompany the City in PPP projects in the coming time./.