Public-private partnership provides a specific contractual framework for delivering public projects, infrastructure, and services of general interest with the involvement of a private partner, while defining obligations, financing arrangements, oversight mechanisms, and risk allocation. In Tunisia, this category of contracts is governed by precise rules — most notably Law No. 2015-49 of 27 November 2015 on partnership contracts, as amended by Law No. 2019-47 — making thorough legal, financial, and institutional preparation an indispensable step before any contract is signed.
Legal Framework of PPP Contracts and Distinction from Concession Agreements
Public-private partnership in Tunisia rests on a legal regime distinct from public procurement contracts and from concession or lease agreements. Law No. 2015-49 defines the concept of the contract, the public entity, the private partner, the project company, the contract duration, the principles of competition, financing, guarantees, oversight, and termination mechanisms. The mere presence of a public party and a private party is not sufficient to characterise a contract as a public-private partnership: legal qualification depends on the nature of the project, the financing model, the duration of the commitment, and the respective responsibilities of each party.
The value of concessions and PPPs becomes clear when a project involves infrastructure or services requiring a balance between the public interest and the viability of private investment. The public-private partnership is distinct from the concession, which falls under Law No. 2008-23 of 1 April 2008 and Government Decree No. 2020-316 of 20 May 2020. This distinction makes it possible to choose the appropriate legal avenue and to avoid any confusion between contracts of a fundamentally different nature.
Comparative Elements Between a PPP Contract and a Concession Contract
| Legal Element | PPP Contract | Concession Contract | Key Drafting Consideration |
| Nature of the relationship | Long-term cooperation to deliver a project or service with shared risk | Exploitation of a service or infrastructure under the concession regime | Accurately characterise the legal nature of the contract |
| Financing | The private partner may assume a significant share of the financing | Generally tied to operating revenues depending on the nature of the concession | Specify the source of financing and payment mechanisms |
| Oversight | Continuous monitoring of performance, execution, and indicators | Oversight linked to operating conditions and compliance with obligations | Define the reports and documents required |
Preparation of the PPP Project Prior to Selection of the Private Partner
A public-private partnership project requires a preliminary study covering the legal, financial, technical, social, and environmental aspects relevant to the nature of the project. Article 7 of Law No. 2015-49 underscores the importance of this study before moving to the award phase. Preparation goes beyond mere cost estimation: it encompasses project feasibility, budgetary impact, risk allocation, and guarantees of public service continuity.
Investment projects in Tunisia require a combined legal reading that addresses authorisations, structuring, financing, contractual obligations, and sector-specific risks. In this context, the public-private partnership should not be viewed as a simple financing instrument, but as a contractual mechanism demanding clarity at every stage — preparation, award, and execution. Government Decree No. 2016-772 of 20 June 2016 further specifies the procedures for preparation and award, including the evaluative study, unsolicited proposals, direct negotiation, and candidate selection.
Points to Verify Before Signing a PPP Contract
Before concluding a public-private partnership contract, several essential elements must be verified: the nature of the project, the competent authority, the existence of the preliminary study, the method of selecting the private partner, the clarity of the financial consideration, the bankability of the project, the conditions of guarantee, the oversight mechanisms, and the grounds for termination. It is equally important to examine whether the project is subject to sector-specific legislation, particularly in the fields of energy, infrastructure, transport, real estate, or local services.
Practical Comparison of Contractual Structures
| Legal Structure | When to Use | Key Legal Considerations |
| Public-private partnership | Long-term projects involving financing, construction, maintenance, or operation | Precise definition of risk allocation, financial consideration, and oversight is essential |
| Concession or lease | Exploitation of a service or infrastructure under a specific legal regime | Not to be confused with a PPP contract |
| Public procurement contract | Acquisition of works, services, or supplies for a public entity | Generally does not follow the same long-term financing logic |
| Investment contract | Private or mixed project linked to an investment structure | Verify authorisations and sector-specific obligations |
Competition and Transparency in PPP Contract Award
The award of a public-private partnership is governed by the principles of competition, transparency, and equal treatment of candidates. Articles 8, 10, 11, and 13 of Law No. 2015-49 highlight the importance of award procedures, whether through competitive tendering, competitive dialogue, or the exceptional cases of direct negotiation. Respect for competition goes beyond the mere publication of a tender notice: it entails clear criteria, neutral evaluation, protection of confidential data, and justification of the selection of the most economically, technically, and legally advantageous offer.
Competition in PPP contracts is inseparable from the principles of transparency and equal treatment of candidates, particularly during the evaluation of offers and the selection of the private partner. Competition law, notably Law No. 2015-36 on competition and prices, can usefully inform the analysis of risks associated with anti-competitive practices or breaches of equality between competitors. This is why the public-private partnership requires rigorous award documentation, setting out the expected performance, transferable risks, execution timelines, and oversight conditions.
Common Legal Errors
One of the most widespread errors is treating the public-private partnership as a simple mechanism for accessing private financing. Dysfunctions can also arise when the preliminary study is neglected, when a generic contractual template is applied without regard to the nature of the project, or when clauses relating to risks, financing, and oversight are drafted in overly vague terms. Furthermore, insufficient distinction between a PPP contract, a concession, and a public procurement contract can give rise to difficulties at the award, execution, and termination stages of the contractual relationship.
Financing and Guarantees in PPP Contracts
Financing is a central issue in public-private partnerships, given that the project company may draw on bank financing, own resources, or payment mechanisms tied to the financial consideration. Financing clauses must be clear as to the method of payment, revision procedures, banking guarantees, creditor rights, and events of default. Long-term contracts also raise questions relating to changes in circumstances, cost escalation, execution delays, or modifications to the project’s scope.
The financial structuring of PPP contracts illuminates the link between project bankability, banking securities, lender rights, and the mechanisms for revising the financial consideration. Government Decree No. 2016-1104 of 4 July 2016 addresses matters relating to the financial consideration and the assignment or pledging of receivables. Government Decree No. 2016-782 of 20 June 2016 concerns the real rights that may encumber works and fixed equipment constructed within the framework of the public-private partnership.
Legal Notice: The presence of private financing or an economic operator is not in itself sufficient to qualify a contract as a public-private partnership. Legal qualification depends on the nature of the project, the duration of the commitment, the financing model, the risk allocation, and the role of the public entity in oversight and monitoring. Depending on the circumstances, the project may fall under a public procurement contract, a concession, an investment contract, or a partnership contract — which makes prior legal analysis indispensable before selecting the appropriate contractual structure.
Project Company, Oversight, and Dispute Resolution
The project company occupies a central position in the public-private partnership, as it is generally the legal vehicle responsible for fulfilling contractual obligations. Its corporate purpose, composition, powers, the conditions governing changes to its shareholding structure, and its liability vis-à-vis the public entity must all be precisely defined. The relationship between the project company and its financiers, subcontractors, and, where applicable, operators must also be clarified.
The project company in PPP contracts raises questions of governance, investor entry, allocation of powers, and decision-making mechanisms — issues that fall squarely within the domain of corporate law and mergers and acquisitions. Oversight extends to periodic reports, financial documents, performance indicators, service quality, compliance with deadlines, and continuity of public service. Presidential Decree No. 2022-451 of 6 May 2022 further defines the role of the General Authority for Public-Private Partnership in the award process, monitoring, support, auditing, and the proposal of reforms.
Dispute resolution in PPP contracts requires forward-looking drafting that accounts for delays, defaults, legislative changes, and the effects of contractual termination. Articles 31 to 36 of Law No. 2015-49 underscore the importance of oversight, reporting, termination, forfeiture, and continuity of public service following the end of the contractual relationship.
Important note: Not every project involving a private partner constitutes a PPP contract. Depending on its nature, financing model, and risk allocation, it may qualify as a public procurement contract, a concession, an investment contract, or an operating contract.
Legal Reading of PPP Contracts in Tunisia
Public-private partnership calls for a legal approach that combines public economic law, investment law, financing, competition law, contract law, and dispute resolution. A lawyer in Tunisia can provide guidance on the legal analysis of partnership contracts from an operational standpoint — whether in relation to project preparation, document review, risk assessment, or the drafting of clauses governing the relationship between the public entity and the private partner. Each situation depends on the nature of the project, the applicable legal texts, and the commitments agreed between the parties.
