Law No. 691-VIQ of the Republic of Azerbaijan, on Public Private Partnership, of 9 December 2022 came into effect as of 27 December 2022. The law broadens regulations of the partnership by establishing A framework for all public-private projects. With the new law coming into effect, the earlier regulation, most noticeably:

  • Law, On Implementation of Investment Projects Related to Construction and Infrastructure Facilities under Special Financing, of 2016 introducing the build-operate-transfer (BOT) model, and
  • Presidential Decree providing for the terms of implementing projects under the BOT model, requirements for investors, specifics and terms of agreements made, and approving the rules to determine the value of goods and services generated from the investments

ceases to have effect.

A private-public partnership (PPP) is a joint activity of private and public partners based on an agreement on the provision, developing and managing the infrastructure, of public services. A public partner is a public authority and other agencies as well as a municipality and municipal enterprises. A private partner is any individuals and entities.

Where required by international undertakings or considerations of public safety of the Republic, participation in competitive procedures of listed foreign applicants or applicants from listed foreign jurisdictions, their ability to make offers as a part of a private initiative, or direct negotiations, can be restricted. PPP agreements with foreign counterparties, including persons they control, or involving foreign an international financiers can be governed by foreign law.

The Law introduces the competent authority, the Ministry of Economy. The Ministry determines the forms and methods of the republic's Participation in each PPP project. The authority also prepares for the approval of the Cabinet of Ministers annual lists of PPP projects that the Republic considers developing under the PPP model.

A PPP project is announced by the competent authority. Interested parties make their offers in response to the announcement in accordance with the set of competitive selection documents. Applicants may form joint ventures among themselves for the purposes of bidding.

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Originally published March 2023.

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