The Scope and Limitations of the Assessment

Understanding the scope of the data utilized in this report is important to interpreting the report's content. The data have both strong and weak points, which readers should keep in mind.

The procurement of PPPs can be carried out at different levels of governments within each economy and is sometimes carried out along sectoral lines. While the report recognizes the complexity of the process, because of limited resources, it examines only those PPPs in which the procuring authority is either national or federal. However, in Australia, Bosnia and Herzegovina, United Arab Emirates, and the United States, the study focuses on the subnational level, measuring the State of New South Wales, the Sarajevo Canton within the Federation of Bosnia and Herzegovina, the Emirate of Dubai, and the Commonwealth of Virginia, respectively. This approach was adopted to address the fact that federal governments in these economies have limited authority regarding infrastructure; this limitation, along with particular constitutional arrangements, make it unfeasible to evaluate the development of PPPs at the national or federal level. The specifics of each of these four cases are discussed in the description of the corresponding regulatory framework available in the project website: http://bpp.worldbank.org.

The regulatory framework to procure PPPs may also differ across sectors, but it is not possible to design a survey that spans all possible types of PPP projects. While most of the answers to the questionnaire may apply to all sectors, the contributors are referred to a case study for the transportation sector (highways) to ensure comparability across surveys (Box 1).

Procuring Infrastructure PPPs 2018 follows the World Bank definition of PPPs12 and applies that definition irrespective of the terminology used in the particular economy or jurisdiction (whether PPPs or concessions). In economies where generally applicable and separate regimes exist for concessions (most often defined as user-pay systems) and PPPs (most often defined as government-pays projects), both regimes were evaluated and scored separately to ensure accuracy. The following dual-regime economies were scrutinized for the purposes of this report: Argentina, Brazil, Costa Rica, France, Mauritius, Niger, Senegal, Togo, and Russian Federation. The specifics of each of these cases are further discussed in the description of the corresponding regulatory framework available in the project website: http://bpp.worldbank.org.

The assessment of Procuring Infrastructure PPPs 2018 is based mostly on the regulatory framework in place for the procurement of PPPs. Most questions included in the survey capture the characteristics of laws and regulations that govern PPP procurement. The report, however, adopts a broad understanding of what constitutes the PPP regulatory framework to include any applicable legal texts and other binding documents (PPP policies and PPP standardized transaction documents and contracts), as well as judicial decisions and administrative precedents regarding the process of procuring PPPs.13 This broad understanding of the PPP regulatory framework helps prevent, to the extent possible, any bias toward a particular legal system (civil law versus common law) or formal configuration of the regulatory framework for PPPs.

To complement the information that is referenced in legal documents, Procuring Infrastructure PPPs 2018 also captures instances in which economies adhere to recognized good practices on a regular basis, in the contributors' opinion, even if those practices are not based on regulations. The assessment thus differentiates between those economies adhering to internationally recognized good practices with and without a regulatory basis. In addition, for a selected set of questions, the survey aims to capture the extent to which the regulatory framework in place for PPPs in each economy is respected in practice. This type of questions covers contributors' perceptions, based on their exposure to and experience with similar PPP projects. For most economies, however, given the already limited number of expert contributors, the pool of contributors that provided information fell short of constituting a representative sample. Consequently, the assessment, particularly when referring to contributors' perceptions, must be understood in the context of this limitation.

It is important to note that Procuring Infrastructure PPPs 2018 does not assess individual PPP projects and contracts on a regular basis or treat them as a source of information. The assessment relies mostly on the input provided by the expert contributors. For answers based on regulatory references, the team also crosschecked the information provided with the referenced regulations and followed up with contributors whenever contradictions were identified.

In an effort to keep the report concise, this report does not cover all the regulatory challenges related to PPP procurement and does not consider the capacity of implementing agencies as demonstrated by staffing numbers and other related factors. Moreover, some issues that matter greatly to firms and policy makers, such as macroeconomic stability and the prevalence of corruption in an economy, are not captured in the survey, despite their importance. While Procuring Infrastructure PPPs 2018 provides an overview of the way regulatory frameworks in different economies address issues that are important to develop PPPs adequately, some relevant factors are not captured. Consequently, Procuring Infrastructure PPPs 2018 cannot be considered a complete and full assessment that provides a straightforward classification of economies based on their capability to procure PPPs.

Furthermore, since the data were compiled in a rather short time frame, the relevant legal and regulatory provisions noted in the report reflect a particular moment in time. Thus, readers should note that the legal situations may have changed. Specifically, data were collected for Procuring Infrastructure PPPs 2018 with June 1, 2017 as the cutoff date. Thus, any regulatory reforms enacted and any practice adopted since this date are not taken into consideration in this year's report.

Finally, the report and the data points are meant to be "actionable" to lawmakers and governments because the respective economy's body of law and regulations is well within the sphere of influence of policy makers and able to be amended. Consequently, the report highlights relevant regulatory aspects of PPP legal frameworks in the hope that the governments of the respective economies will seize the opportunity to design reform agendas. However, given the limitations discussed, the report does not attempt to "rank" economies by their capability to procure PPPs.