At a session on 19 June, the Verkhovna Rada of Ukraine passed the second and final reading of the draft law No. 7508 on amending certain Ukrainian legislative acts to improve the mechanism for attracting private investment via public-private partnerships (PPPs). The document aims to accelerate the reconstruction of war-damaged infrastructure and facilitate the construction of new facilities related to the post-war restructuring of the Ukrainian economy.
The draft law was passed with 256 votes, the CFTS portal reports.
The draft law was first registered in the Verkhovna Rada in July 2022 and passed the first reading in October of that year. Taras Boichuk, the head of the Project Office for the Development of Public-Private Partnerships, noted that the adoption of the draft law is a step toward completing the PPP reform: "It entails making all the necessary changes across all sectors, including transport, to ensure this mechanism functions effectively."
According to the authors of the document, adopting the law is crucial for preparing and implementing the concession projects and other types of PPP that the Ministry for Development of Communities, Territories, and Infrastructure and other government partners are currently preparing, as well as for those under consideration. These include the concession project for the Chornomorsk Port’s Terminal No. 1, Container Terminal, and Terminal No. 5 (the rail-ferry complex), as well as for the concession projects for the assets of the Ukrainian Sea Ports Authority (USPA) that are linked to these terminals.
In addition, the law improves the regulatory framework for a project involving the introduction of a national tolling system for collecting tolls for freight transportation on certain roads.
In the transport sector, the document will also cover pilot projects involving the construction, operation, and maintenance of roads and/or tunnels, as well as airport concession projects. It may also address public transportation, including the procurement of rolling stock and the provision of passenger transportation services.
Among other things, the adopted legislative act aims to resolve problematic issues related to the possible format for resuming the implementation of the concession projects in the ports of Olvia and Kherson, which were suspended due to Russia's full-scale invasion and the resulting blockade of the Mykolaiv ports, particularly the Olvia and Kherson ports.
The adopted law, according to its authors, is generally expected to simplify and standardize the procedure for preparing PPP projects for infrastructure reconstruction and new construction projects. The novelties of the law include the reduction of investment risk by allowing the combination of private and donor financing. The law also removes barriers to implementing PPP and concession projects by taking into account the experience gained during the preparation and implementation of pilot projects.
For small-scale projects (valued at up to EUR 5.5 million), the document shortens the timeframe for preparing documentation from 19 months to 8-12 months.
The document emphasizes that accelerating the procedure for involving the private sector in infrastructure reconstruction is critical at both the state and local levels, as implementing a significant number of priority reconstruction projects with state and local budget funds alone is considered impossible.
