The PPP project implementation agency shall complete the audit rectification of the audit issues of the existing projects (referring to the projects that have been implemented before February 2023) in accordance with the law. Although the PPP project library has been abolished, the people at or above the county level are still responsible for PPP stock projects. Managing PPP stock projects in accordance with laws and regulations is an effective way to avoid adding new local hidden debts. The implementing agency should insist on paying according to performance on the basis of completing the performance evaluation to reduce disputes over existing projects.
The audit rectification of the stock project "looks back".
(1) Classification of audit issues of PPP stock projects
On June 26, 2023, the Audit Commission was entrusted by *** to make the "Audit Report on the Implementation of the 2022 ** Budget and Other Financial Revenues and Expenditures" to the third meeting of the Standing Committee of the 14th National People's Congress. The problems identified by the audit department as existing PPP projects can be divided into legislative reforms, phased rectification and continuous rectification. **The audit department performs special audit administrative functions for PPP projects, and the implementing agency is generally regarded as the auditee. Therefore, because the rectification of the special audit of PPP projects is a work that is continuously completed by the local government and the implementation agency, the existing projects need to be audited and rectified to "look back".
(2) The dispute path of audit rectification issues
The project company and the private party are generally not eligible auditees (except for the project company according to the nature of state-owned equity). However, the implementing agency will generally implement the project rectification issues strictly in accordance with the audit opinions. The audit report shall have legal effect unless it is revoked by the audit department or the people's court in accordance with the law. The audit department issues an audit report to the implementing agency. If the project company and the private party believe that the audit decision or audit report infringes upon their legitimate rights, they may file an administrative lawsuit as an interested party in accordance with the provisions of the Administrative Litigation Law. If the implementing agency makes a specific administrative decision based on the audit report, or violates the PPP project contract in the course of performing the PPP project contract, the project company and the private party may file a lawsuit against the implementing agency.
How to change the PPP comprehensive information platform after it is cancelled
(1) Abolish the normative documents of the PPP project library
The Ministry of Finance recently issued the Notice on the Abolition of Relevant Documents of ** and Social-Private Partnership (PPP) (Cai Jin 2023 No. 98), in which most of the repealed normative documents are related to the (PPP) comprehensive information platform project library. If the PPP project library does not exist, there is no public legal document to stipulate whether the existing projects should still perform the PPP change filing procedure. The Ministry of Finance's PPP project library no longer exists, and we speculate that the PPP change specifications of provincial financial departments may be gradually abolished due to the new regulations of the Ministry of Finance.
(2) Project changes after the cancellation of the PPP project library
The Implementation Opinions on Further Promoting the Standardized Development of ** and Social-Capital Partnership (Su Cai Jin 2017 No. 92) stipulates: "(3) When there is a major change in the implementation of the project compared with the time of warehousing (including but not limited to the total amount of project investment, construction content, and financial affordability), within 10 working days after the project change approval procedures are performed in accordance with the regulations, the applicant shall formally apply for change and adjustment to the Provincial Department of Finance. ”
Therefore, regardless of whether the provincial financial management department requires the municipal and county financial departments to report PPP change and withdrawal information in the future. We believe that the people at the county level should strictly fulfill the procedural requirements for the change of PPP projects in accordance with the law, so as to ensure that the existing projects do not add hidden debts due to illegal changes.
Standardized development and sunshine operation of existing projects
(1) The PPP normative documents of the stock project are still valid
Implementation Opinions on Promoting the Standardized Development of ** and Social-Capital Partnership (Cai Jin 2019 No. 10), Notice on Further Promoting the Standardized Development and Sunshine Operation of ** and Social-Capital Partnership (PPP) (Cai Jin 2022 No. 119), and "Opinions on Further Strengthening the Financial Supervision of ** and Social-Capital Partnership (PPP) Projects" (Su Cai Jin 2019 No. 53). The above-mentioned documents of the Ministry of Finance are still valid, and PPP stock projects should still be operated in accordance with the above-mentioned documents in accordance with laws and regulations to ensure the continuous supply of public goods and services. Although the financial department is no longer responsible for the examination and approval of "one case and two evaluations", it is recommended that the people at or above the county level still perform the approval procedures for PPP changes. The sunny operation of PPP stock projects is the feasible way to eliminate the hidden debts of new local governments.
(2) The financial department is still the competent authority for the stock project
According to the notice of the General Office of the National Development and Reform Commission and the Ministry of Finance on Standardizing the Implementation of the New Mechanism for Social-Private Partnership (Guo Ban Han 2023 No. 115) (hereinafter referred to as Guo Ban No. 115), China's PPP projects are divided into existing projects and new mechanisms. Judging from the current national top-level design structure of PPP, it is likely that the development and reform department will not be involved in the management of existing PPP projects. Therefore, local governments at all levels should be the main responsible unit for stock projects, and county-level financial management departments should continue to complete the supervision responsibilities of PPP stock projects.
(3) Pay according to the effect of the stock project and avoid disputes
*Operational Guidelines for Performance Management of PPP Projects (Cai Jin 2020 No. 13) regulates that local governments should perform their existing projects in accordance with the requirements of PPP project contracts, carry out performance evaluations in accordance with the law, and pay according to the results of performance evaluations. Avoid overdue default in loan repayment caused by the implementation agency, which will affect the stability and sustainability of public service supply.
Disputes over PPP stock projects are gradually increasing, and disputes over PPP stock projects have emerged one after another across the country. Although the Provisions of the Supreme People's Court on Several Issues Concerning the Trial of Administrative Agreement Cases have been promulgated for many years, the coexistence of administrative and civil disputes still occurs in practice. Even different tribunals of the same court have different ways of dealing with PPP disputes.
PPP project contracts are generally signed in accordance with the procurement procedures, and the parties to the procurement contract shall not change, suspend or terminate the contract in principle. The first party and the private party shall abide by the principle of consistency between the PPP project contract and the project implementation plan and procurement documents. However, in practice, if the continued performance of the PPP project contract will harm the public interest or national interest, the first party has the right to choose three discretionary methods: modification, suspension or termination, and modify the PPP project contract in accordance with the law after performing the PPP change filing procedures in accordance with the law.
Classified disposal of PPP stock projects, performance in accordance with laws and agreements, standardized development and sunshine operation are still one of the directions of future stock projects.