New Law on Concessions and Public-Private Partnerships (PPP) in Albania

 

 

 

The Albanian Government has approved a new law titled “On Concessions and Public-Private Partnerships (PPP)”, establishing a comprehensive legal framework to regulate cooperation between the public and private sectors in implementing projects of public interest.

Scope of Application

Public-private partnerships can be implemented across a wide range of sectors, including transportation, energy, water supply, waste management, telecommunications, education, culture, and healthcare.

The law aims to provide a clear foundation for collaboration between public authorities and private operators, fostering the development of modern infrastructure and the delivery of high-quality, efficient public services.

Key Objectives of the Law

The new legislation defines:

  • The responsibilities and competencies of public authorities in signing concession and PPP contracts;

  • The procedures for awarding, signing, amending, or terminating such contracts;

  • The allocation of financial and fiscal risks between the parties;

  • The rules governing public financial support and fiscal management of PPP projects.

Main Terms and Definitions

  • Concession: An agreement for the construction or provision of public services, where the private partner is compensated either through the right to exploit the asset or via direct payments.

  • Public-Private Partnership (PPP): A stable cooperation between the State and a private entity for the implementation or management of public infrastructure and services.

  • Operational Risk: The risk transferred to the concessionaire related to demand, supply, or service availability.

  • SPV (Special Purpose Vehicle): A private company established specifically for the implementation of a concession or PPP contract.

Fundamental Principles

The awarding procedures for PPP contracts must adhere to the following principles:

  • Transparency and equal treatment;

  • Non-discrimination and proportionality;

  • Efficiency and legal certainty;

  • Autonomy of public authorities, allowing them to manage services directly or delegate them to economic operators;

  • Protection of public property, as the law does not foresee the privatization of state-owned enterprises.

Purpose of the Legislative Reform

This reform aims to strengthen legal security and transparency in concession procedures, ensure fair risk-sharing between public and private partners, and encourage sustainable private sector participation — ultimately contributing to Albania’s economic development and modernization of its public infrastructure.