ministerial regulation no.3 2012

8/9/2019 Ministerial Regulation No.3 2012

http://slidepdf.com/reader/full/ministerial-regulation-no3-2012 1/138

UNOFFICIAL ENGLISH VERSION OF PERMEN PPNNO. 3 / 2012 ON THE OPERATIONAL GUIDELINES

M ANUAL FOR THE IMPLEMENTATION OF PUBLIC

PRIVATE P ARTNERSHIP IN THE PROVISION OF

INFRASTRUCTURE

June 2013

The Government of Indonesia

State Ministry for National Development Planning /National Development Planning Agency (Bappenas)



265095 MMI MMI 21 A

C:\265095 - P3CU Project\03. Documents\3.2-

01 June 2013

UNOFFICIAL

ENGLISH

VERSION OF

PERMEN

PPN NO

.3 / 2012 ON THE OPERATIONAL GUIDELINES M ANUAL

FOR THE IMPLEMENTATION OF PUBLIC PRIVATE

P ARTNERSHIP IN THE PROVISION OF

INFRASTRUCTURE

PERMEN PPN 3/2012

June 2013

Loan ADB No. 2264-INO (SF)



REGULATION OF THE STATE MINISTER OF NATIONAL DEVELOPMENT

PLANNING/

HEAD OF NATIONAL DEVELOPMENT PLANNING AGENCY

NUMBER 3 OF 2012

ON

THE OPERATIONAL GUIDELINES MANUAL FOR THE IMPLEMENTATION OF

PUBLIC PRIVATE PARTNERSHIPS IN THE PROVISION OF

INFRASTRUCTURE

BY THE GRACE OF GOD ALMIGHTY

THE STATE MINISTER OF NATIONAL DEVELOPMENT PLANNING/

HEAD OF NATIONAL DEVELOPMENT PLANNING AGENCY,

Considering : a. that in order to carry out the main tasks and coordination

functions, synchronization, preparation of policy

formulation, monitoring and evaluation, as well as work

relation in the national development planning in the field

of facilities and infrastructure, it is necessary to take

acceleration steps of infrastructure provision through

public private partnership;



Minister of National Development Planning/Head of

National Development Planning Agency Number 4 of

2010 on General Guidelines of Implementation of

Cooperation between the Government and Business

Entities in Infrastructure Provision has been enacted;

c. that by the presence of amendment of laws and

regulations related to the Cooperation between the

Government and Business Entities in Infrastructure

Provision, then the Ministerial Regulation as referred in

letter b shall be altered;

d. that based on the consideration as intended in letter c, it

is necessary to enact Regulation of the State Minister of

National Development Planning/Head of National

Development Planning Agency on the Operational

Guidelines Manual for the Implementation Public Private

Partnerships in Infrastructure Provision;

In view of : 1. President Regulation Number 82 of 2007 on National



amended several times, last by President Regulation

Number 91 of 2011;

3. President Regulation Number 5 of 2010 on National

Medium-Term Development Plan of 2010-2014;

4. Regulation of the State Minister of National Development

Planning/Head of National Development Planning

Agency Number PER. 005/M.PPN/10/2007 on

Organization and Work Procedures of the State Ministry

of National Development Planning/National

Development Planning Agency;

HAS DECIDED:

Promulgate : REGULATION OF THE STATE MINISTER OF NATIONAL

DEVELOPMENT PLANNING/HEAD OF NATIONAL

DEVELOPMENT PLANNING AGENCY ON THE

OPERATIONAL GUIDELINES MANUAL FOR THE

IMPELEMENTATION OF PUBLIC PRIVATE

PARTNERSHIPS IN THE PROVISION OF

INFRASTRUCTURE



CHAPTER I

GENERAL PROVISIONS

Article 1

In this Minister Regulation which is meant by:

1. The Operational Guidelines Manual of the Implementation of PPP Project,

hereinafter referred to as the OGM, is the guidelines and procedures used

as references by the Government Contracting Agency of the PPP Project in

the implementation of PPP Project based on the PPP Contract.

2. Provision of Infrastructure is the activities covering the construction works to

build or improve infrastructure capacities and/or activities of infrastructure

management and/or infrastructure maintenance in order to improve the

benefits of infrastructure services.

3. The Government Contracting Agency of PPP Project, hereinafter referred to

as the GCA, is the Minister, Institutional Head, Regional Head and President

Director of the State/Regional-Owned Enterprise in compliance with laws

and regulations pertaining to the related sector saying that the Provision of

Infrastructure by the Government shall be managed or carried out by the

State/Regional-Owned Enterprise.

4 Minister/Institutional Head is the head of ministry/institution which the scope



6. The Business Entity is a private business entity in the form of a limited

liability, State-Owned Enterprise (BUMN), Regional-Owned Enterprise

(BUMD), and cooperative.

7. Public Private Partnership is the cooperation between the Government and

Business Entities in the Provision of Infrastructure through a PPP Contract or

Business Licence.

8. PPP Contract is a written agreement for Provision of Infrastructure between

the Government and the Business Entity decided on via public tender and

not in conflict with the laws and regulations.

9. PPP Project is the Provision of Infrastructure carried out through a Public-

Private Partnerships Contract between the GCA and the Business Entity.

10. Public Consultation is a process of interaction between the GCA and

stakeholders to enhance the transparency, efficiency, accountability and

effectiveness of the PPP Project.

11. Government Support is both the fiscal and non-fiscal contribution provided

by the Minister/Institutional Head/Regional Head and/or Minister of Finance

in accordance with their respective authority based on the laws and

regulations in order to improve the financial feasibility of the PPP Project.

12. Government Guarantee is the financial compensation and/or compensation

in other forms provided by the Minister of Finance to the Business Entity



Planning, is the minister managing the government affairs in the field of

national development planning.

14. Minister of Finance is the minister managing the government affairs in

financial sector and state’s assets.

15. Infrastructure Guarantor Business Entity, hereinafter referred to as the BUPI,

is a business entity founded by the Government and assigned with special

tasks to provide infrastructure guarantee in accordance with the existing

laws and regulations.

16. Regional Government is the Regional Head together with other regional

autonomy officials as the Regional Executive Agency.

17. Central Government, hereinafter referred to as the Government, is the

President of the Republic of Indonesia holding the power of administration of

the State of the Republic of Indonesia as stipulated in the Constitution of the

Republic of Indonesia of 1945.

18. PPP Book is the document containing the PPP Projects plan specified in the

List of Project Priorities set by the GCA and has undergone evaluation by the

Minister of Planning to be determined as the Potential and/or Prospective

and/or Ready-to-Offer PPP Projects.

Article 2

The OGM is intended to:



b. provide guidelines for the Minister in preparing sector guidelines of

implementation of PPP projects in the related sector.

Article 3

(1) This OGM applies to PPP Projects implemented through a Contractual

Arrangement.

(2) The scope of infrastructures regulated under this OGM include:

a. transportation infrastructure, covering airport services, provision and/or

services of harbour, facility and infrastructure of railways;

b. road infrastructure, covering toll roads and toll bridges;

c. irrigation infrastructure, covering ducts to transport raw water;

d. infrastructure of drinking water, covering building for raw water collection,

transmission network, distribution network, processing installation of

drinking water;

e. sanitation infrastructure covering installation of wastewater, collecting

network and primary network, and waste facilities covering transporters

and disposal sites;

f. telecommunication and informatics infrastructure, covering

telecommunication networks and e-government infrastructures;

g. electricity infrastructure, covering power plant, including development of

electric power derived from geothermal, transmission or distribution of



CHAPTER II

SCOPE OF PPP PROJECT DEVELOPMENT CYCLE

Article 4

(1) The PPP Project Development Cycle (the PPP Project Cycle) shall be

carried out in the following phases:

a. Planning of PPP Project;

b. Preparation of PPP Project;

c. Transaction of PPP Project; and

d. Implementation Management of PPP Contract.

(2) In performing the phases of the PPP Project Cycle as referred in paragraph

(1), the supporting activities constituting parts of the implementation ofthe

respective PPP Project phase may simultaneously be carried.

(3) The supporting activities as referred in paragraph (2) cover the activities of:

a. planning and implementation and land acquisition and resettlement;

b. environmental study; and

c. request for the bestowing of Government Support and/or Government

Guarantee.

Further provisions in respect of the implementation phases of the PPP Project

Cycle as referred in paragraph (1) are regulated in the Attachments herein,

forming one entirity and inseparable part of this Ministerial Regulation



(2) The GCA may be assisted by a consultant to conduct the planning,

preparation, transaction of the PPP Project and management of the PPP

Contract.

(3) The procurement of consultant as referred in paragraph (2) shall be carried

out by the GCA in accordance with the laws and regulations.

Article 6

(1) The plan of developing PPP Projects as referred in Article 4 paragraph (1)

shall be in accordance with the National Medium-Term Development Plan,

Ministry/Institutional‘s Strategic Plan and Work Plan, and/or the Regional

Medium-Term Development Plan and Regional Government’s Work Plan in

accordance with the laws and regulations.

(2) PPP Projects offered to Business Entities shall be commercially feasible.

(3) A PPP Project is declared commercially feasible if it is legally, economically,

technically, financially feasible, provides social benefits, and is

environmentally sustainable.

Article 7

(1) In carrying out PPP Projects, the GCA shall perform Public Consultations.

(2) The Public Consultations as referred in paragraph (1) shall be carried out at

the phase of:

a Planning of the PPP Project Cycle;



(3) The Public Consultations at the Planning phase of the PPP Project Cycle as

referred in paragraph (2) letter a is intended to obtain consideration as to the

benefits and impacts of the PPP Project for public interests.

(4) The Public Consultations at the Project Preparation phase of the PPP

Project Cycle as referred in paragraph (2) letter b is aimed to:

a. explore the compliance to social and environmental norms according to

the provisions of laws and rregulationss in the environmental sector;

b. obtain opinion on the attraction and feasibility of the choice of

Cooperation form (modality); and

c. ensure the readiness of the PPP Project.

(5) The Public Consultations at the Transaction phase of the PPP Project Cycle

as referred in paragraph (2) letter c is intended to obtain response from the

stakeholders conducting through testing market interests (market sounding).

(6) The stakeholders as referred in paragraph (5) are derived from investors and

financial institutions.



CHAPTER III

THE PLANNING PHASE OF THE PPP PROJECT CYCLE

Article 8

(1) The Planning Phase of the PPP Project Cycle as referred in Article 4

paragraph (1) letter a comprises of activities of:

a. identification and selection of PPP Projects; and

b. prioritization of PPP Projects.

(2) Identification and selection of PPP Projects referred to in paragraph (1) letter

a, is intended to determine potential PPP Projects to be cooperated with

Business Entities (the private sectpr) using the approach of needs analysis,

compliance criteria and determinant factor criteria of the benefits of private

sector’s involvement.

(3) Prioritization of PPP Projects referred to in paragraph (1) letter b, is intended

to determine more important projects shall be prioritized by considering the

aspects of public needs, budget capacity, development period and other

strategic considerations.

Article 9

(1) The Planning phase of the PPP Project Cycle as referred in Article 8

paragraph (1) generates a Preliminary Study Document and a List of Priority



a. proposed potential PPP projects;

b. proposed prospective PPP projects; and

c. proposed ready-to-offer PPP projects.

(4) Provisions pertaining to procedures to be registered in the PPP Book are

regulated under Regulation of the Minister of Planning.

Article 10

Further provisions pertaining to the implementation of the Planning Phase of

PPP Project Cycle as referred in Article 8 is regulated in Chapter II of the

Attachment hereof forming one entirity and inseparable part of this Ministerial

Regulation.



CHAPTER IV

THE PROJECT PREPARATION PHASE OF THE PPP PROJECT CYCLE

Article 11

(1) The phase of Project Preparation of the PPP Project Cycle as intended in

Article 4 paragraph (1) letter b comprises of activities of:

a. preparation of Preliminary Appraisal of Pre-Feasibility Study; and

b. preparation of Project Readiness Assessment.

(2) The Preparation of Preliminary Appraisal of Pre-Feasibility Study referred to

in paragraph (1) letter a, is intended to obtain initial conclusion of commercial

feasibility of the PPP Project.

(3) The Preparation of Project Readiness Assessment is intended to ensure that

the PPP Project is ready to proceed to the next phase of Transaction of the

PPP Project Cycle.

Article 12

The Project Preparation phase of the PPP Project Cycle as referred in Article 11

generates Documents of PPP Project Preparation.

Article 13

Further provisions pertaining to the implementation of the Preparation Phase of



CHAPTER V

THE TRANSACTION PHASE OF THE PPP PROJECT CYCLE

Article 14

The Transaction Phase of the PPP Project Cycle as referred in Article 4

paragraph (1) letter c comprises of:

a. The completion of the Pre-Feasibility Study covering the final appraisal of

the pre-feasibility study (the Final Business Case) and the draft of

procurement plan of the Business Entity; and

b. the public tender of the Business Entity covering the planning and

implementation of the Business Entity’s public tender.

Article 15

The Transaction phase of the PPP Project Cycle generates Documents of the

Pre-Feasibility Study of the PPP Project, declaration of the winner of the

Business Entity’s public tender and the PPP Contract.

Article 16

In the event the Government Support and/or Government Guarantee are

required, the GCA shall submit:

a. Documents of the Pre-Feasibility Study as referred in Article 14 to the

Minister of Finance to obtain a statement of preparedness to provide the



Article 17

Further provisions pertaining to the implementation of the Transaction phase of

the PPP Project Cycle as referred in Article 14 is regulated in Chapter IV of the

attachment hereof, which forms one entirity and inseparable part of this

Ministerial Regulation.



CHAPTER VI

THE CONTRACT MANAGEMENT PHASE OF THE PPP PROJECT CYCLE

Article 18

(1) The Contract Management Phase of the PPP Project Cycle comprises of:

a. planning for the Implementation of the PPP Contract Management ; and

b. implementation of the PPP Contract Management .

(2) Activities of planning for the implementation of the PPP Contract

Management as referred in paragraph (1) letter b shall be carried out at the

time of:

a. pre-construction, commencing since the signing of the PPP Contract

until the funding is obtained (the financial close);

b. construction, commencing since the beginning of construction until the

PPP Project operates commercially;

c. commercial operation, commencing since the PPP Project operates

commercially until the expiry date of the PPP Contract; and

d. the termination of the PPP Contract.

Article 19

The Contract Management Phase of the PPP Project Cycle generates

documents of report of the implementation the PPP Contract management



Article 20

(1) In performing the Contract Management Phase of the PPP Project Cycle, the

GCA shall establish a Management Unit of the PPP Contract Management.

(2) The Management Unit of the PPP Contract Management as referred in

paragraph (1) is in charge to prepare, plan and carry out the implementation

of the PPP Contract Management.

Article 21

Further provisions pertaining to the implementation of the PPP Contact

Management of the PPP Project Cycle as referred in Article 18 are regulated in

Chapter V of the attachment hereof, which forms one entirity and inseparable

part of this Ministerial Regulation.



CHAPTER VII

THE PROCEDURES OF MANAGING UNSOLICITED PROJECT PROPOSALS

Article 22

(1) The procedures for managing Unsolicited Project Proposals shall be carried

out in the following stages:

a. Stage of Approval of the Unsolicited Project Proposal; and

b. Stage of Implementation of Public Tender of the Unsolicited Project.

(2) The Unsolicited Project Proposal shall meet the conditions of:

a. not being included in the master plan of the related sector;

b. being technically integrated in the master plan of the related sector;

c. being economically and financially feasible; and

d. not requiring Government Support in the terms of fiscal contribution in

financial form.

Article 23

The stage of approval of the Unsolicited Project proposal generates Documents

of the Project Concept, Documents of the Pre-Feasibility Study and Documents

of the Feasibility Study.

Article 24

Further provisions pertaining to the stages of the Unsolicited Project proposal as

referred in Article 22 paragraph (1) are regulated in Chapter VI of the attachment



CHAPTER VIII

TRANSITIONAL PROVISIONS

Article 25

By the enactment of this Ministerial Regulation:

a. PPP Projects that have completely fulfilled the activities in the Planning

phase of the PPP Project Cycle under the Ministerial Regulation prior to the

promulgation of this Ministerial Regulation, then the required activities in the

next phases of the PPP Project Cycle shall adhere to the provisions as

regulated herein.

b. PPP Projects that have completely fulfilled the activities of developing the

preliminary appraisal of the Pre-Feasibility Study (the Outline Business

Case) and the assessment of Project Readiness in the phase of Pre-

Feasibility Study under the Ministerial Regulation prior to the promulgation of

this Ministerial Regulation, then the activities of developing the final appraisal

of the Pre-Feasbility Study (the Final Business Case) and the required

activities in the next phases of the PPP Project Cycle shall adhere to the

provisions as regulated herein.

c. PPP Projects that have completely fulfilled the activities in the Transaction

phase of the PPP Project Cycle under the Ministerial Regulation prior to the

promulgation of this Ministerial Regulation, then the required activities of the



CHAPTER IX

CLOSING PROVISIONS

Article 26

By the enactment of this Ministerial Regulation, Regulation of the State Minister

of National Development Planning/Head of National Development Planning

Agency Number 4 of 2010 on General Guidelines of Implementation of

Cooperation between the Government and the Business Entity in Infrastructure

Provision shall be revoked and declared invalid.

Article 27

This Ministerial Regulation shall come into force since the date of its enactment.

For public cognisance, this Ministerial Regulation shall be promulgated by

placing it in the State Gazette of the Republic of Indonesia.



Stipulated in Jakarta

on 27 June 2012

THE STATE MINISTER OF NATIONAL DEVELOPMENT PLANNING/HEAD

OF NATIONAL DEVELOPMENT PLANNING AGENCY

signed

ARMIDA S. ALISJAHBANA

Promulgated in Jakarta

on 28 June 2012

MINISTER OF LAW AND HUMAN RIGHTS

Signed

AMIR SYAMSUDIN

STATE GAZETTE OF THE REPUBLIC OF INDONESIA OF 2012 NUMBER

662

True copy of its original

Head of Legal Bureau

T h i l A i d S f P bli P i P hi C l U i (P3CU) U ffi i l



Technical Asistance and Support for Public Private Partnership Central Unit (P3CU) - Unofficial

English Version of Permen PPN no. 3 / 2012 on the Operational Guidelines Manual for the

Implementation of Public Private Partnership in the Provision of Infrastructure

Content

CHAPTER I

INTRODUCTION.............................................................................................

A. Background ..............................................................................

B. Objectives ........................................................................................

C. Definition .........................................................................................

D. Phasing of the PPP Project Cycle.....................................................

E. Series of Activities related to the PPP Development Cycle............

F. Related Regulations ..................................................................

1

1

1

1

5

8

15

CHAPTER II

THE PLANNING PHASE OF THE PPP PROJECT CYCLE .......................

A. General Provisions ..............................................................................

B. Identification and Selection of PPP Projects...................................

C. Prioritaztion of PPP Projects............................................................

D. Decision Making to Go or Not Go of the proposed PPP Project

to proceed to the Project Preparation Phase of the PPP Project

C l

18

18

19

20

22

Technical Asistance and Support for Public Private Partnership Central Unit (P3CU) Unofficial






CHAPTER III

THE PROJECT PREPARATION PHASE OF THE PPP PROJECT CYCLE..


B. Preparation of Preliminary Appraisal of Pre-Feasibility Study

Documents.........................................................................................

C. Assessment of Project Readiness......................................................

D. Decision Making for Go or Not Go for the proposed Project to

proceed to the Transaction Phase...... ................................................

E. Supporting Activities during the Project Preparation

Phase…………………………………………………………………..

F. Documents Generated during the Project Preparation Phase....

25

25

26

36

37

37

38

CHAPTER IV

THE TRANSACTION PHASE OF THE PPP PROJECT CYCLE ...............

A. General Provisions .............................................................................

B. Completion of the Feasibility Pre-study ..............................................

C. Procurement of Business Entity ........................................................

D. Decision Making for the proposed Project to proceed to the

42

42

43

43

Technical Asistance and Support for Public Private Partnership Central Unit (P3CU) Unofficial






CHAPTER V

THE PPP CONTRACT MANAGEMENT PHASE........................................

A. General Provisions ..........................................................................

B. Planning for the Implementation of the PPP Contract Management

C. Activities Performed during the implementation of the PPP Contract

Management........ ...............................................................................

D. Other Activities During the PPP Contract Management Phase.............

E. Documents during the Contract Management Phase.......................

70

70

70

72

75

75

CHAPTER VI

THE PROCEDURES TO MANAGE UNSOLICITED PPP PROJECT

PROPOSALS....................................................................................................


B. The Stage of Approval Process of Unsolicited PPP Project Proposals

C. Implementation of Public Tender for Unsolicited PPP Project........

D. Preparation for the Signing of the PPP Contract..................................

E. Documents...........................................................................................

77

77

77

81

101

102



CHAPTER I

INTRODUCTION

A. Background

Within the framework of the national development planning in performing thetasks and functions of coordination, synchronization, preparation of policyformulation, monitoring and evaluation, as well as management of work relationin the field of economic infrastructure, the Ministry of National DevelopmentPlanning/National Development Planning Agency takes necessary steps inaccelerating the provision of infrastructure through public private partnership.

As stipulated in the National Medium-Term Development Plan of 2010-2014, theGovernment encourages participation of the private, public and regionalgovernment in providing services and management of infrastructure. With theintention that the stakeholders could better understand and carry out PPP project

accordingly, it is necessary to provide an operational guidelines manual (OGM)for PPP implementation. This OGM is legally enacted as the Regulation of theState Minister of National Development Planning/Head of National DevelopmentPlanning Agency on General Guidelines of Implementation of Cooperationbetween the Government and Business Entities (Public-Private Partnerships) inthe Provision of Infrastructure, hereinafter referred to as the OGM.

B. Objectives

The objectives of this OGM are:

1. to provide guidelines for the line Ministers in preparing guidelines for theimplementation of Public-Private Partnership in their respective sector; and

2. to provide guidelines for Minister/(Non-ministerial) Institutional Head/Regional Head (Governor/Regent/Mayor) in the implementation of PPPProject to promote private participation in infrastructure provision.

C. Definition



2. The Public Private Partnership Node, hereinafter referred to as the PPPNode, is a working unit within the Ministry/Institution at the national level or adivision of the TKKSD at the regional level, newly formed or is adhered tothe existing working unit or divisions, with the tasks and functions in theplanning for cooperation with the business entity.

3. Multi-Criteria Analysis, hereinafter referred to as the MCA, describes anystructured approach used to determine overall preferences amongalternative options, where the options accomplish several objectives. InMCA, desirable objectives are specified and corresponding attributes or

indicators are identified. The actual measurement of indicators need not bein monetary terms, but are often based on the quantitative analysis (throughscoring, ranking and weighting) of a wide range of qualitative impactcategories and criteria.

4. Social Benefit Cost Analysis, hereinafter referred to as the SCBA, is amethodology for evaluating a project from the view point of the society (oreconomy) as a whole.

5. Economic Internal Rate of Return, hereinafter referred to as the EIRR, is the

calculation of economic interest rate equating the present value ofinvestment with the present value on returns/benefits in future.

6. Economic Net Present Value, hereinafter referred to as the ENPV, is thedifference of the economic value between the present value of investmentand the present value of returns/benefits planned to be received in future.

7. Financial Internal Rate of Return, hereinafter referred to as the FIRR, is anindicator to measure the financial return on investment of an income

generation project and is used to make the investment decision. The FIRR isobtained by equating the present value of investment costs ( as cash out-flows ) and the present value of net incomes ( as cash in-flows ).

8. Financial Net Present Value, hereinafter referred to as the FNPV, is thedifference between the present value of investment and the present value ofreturns of net cash obtained in future.

9. Weighted Average Cost of Capital, hereinafter referred to as the WACC, isthe determination of level of capital cost by calculating the weighted averageof capital.

10. Affiliation is:

a. family relation by marriage and descent up to the second degree, bothhorizontally and vertically;



e. relation between the company and the main shareholder.

11. A Preliminary Study Document is the document prepared by the GCA andthe preparation thereof is carried out in the Planning Phase of PPP ProjectCycle.

12. Documents of PPP Project Preparation are the documents prepared by theGCA and the preparation thereof is carried out in the Project PreparationPhase of PPP Project Cycle.

13. Pre- Feasibility Study is the feasibility study of the PPP Project conducted bythe GCA in the event of Cooperation (PPP) Project is on the Government’sinitiative or by a Prospective Initiator in the event of PPP Project is on theBusiness Entity’s Initiative (unsolicited).

14. A Pre-Feasibility Study Document is the document prepared by the GCA andthe preparation thereof is carried out in the Transaction Phase of PPPProject cycle or by the Prospective Proponent in the approval stage ofproposal of the Unsolicited PPP Project in the framework of fulfilling one ofthe requirements in order to obtain an Approval Letter to conduct a

Feasibility Study from the GCA.15. Feasibility Study is the due diligence performed by a Business Entity to

prepare a Bid Proposal Document in the implementation stage of publictender of the business entity to carry out the PPP Project or by theProspective Proponent to prepare a Feasibility Study document as one ofthe requirements for approval by the GCA to be designated as the Initiator ofthe unsolicited project proposal..

16. A Feasibility Study document is the document prepared by the Prospective

Initiator and the preparation thereof shall be carried out in the approval stageof an Unsolicited PPP Project proposal in order to fulfil one of therequirements to obtain a letter of decision as an Initiator from the GCA.

17. Tender Documents are the documents prepared by the ProcurementCommittee containing the elucidation of the PPP Project, tenderrequirements and evaluation criteria as well as instructions that should beadhered to by tender participants.

18. Minutes of Pre-bid Meeting(s), hereinafter referred to as the BAP, is theminutes of elucidation pertaining to public tender containing the elucidationof Tender Documents and other information including alteration of theTender Documents signed by the Procurement Committee and by minimally1 (one) representative of the appearing tender participants, and forms oneunit inseparable of the Tender Documents.



21. Minutes of Results of the Tender, hereinafter referred to as the BAHP, is theminutes containing results of the public tender execution, including methodof evaluation, the formulas used, up to the determination of sequence of thewinners in the form of list of participants of the public tender.

22. Minutes of Result of Negotiation, hereinafter referred to as the BAHN, is theminutes containing the result of negotiation carried out by the ProcurementCommitteee with a single prospective bidder.

23. Foreign Legal Entity is a business entity incorporated under the law of acountry outside Indonesia.

24. A Prospective Proponent is a Business Entity in the form of limited liability,State-owned Enterprise (BUMN), Regional-owned Enterprise (BUMD),Foreign Legal Entity, and cooperative submitting an unsolicited PPP Projectproposal to the Government or Regional Government.

25. An Original Proponent is a Prospective Proponent who has been designatedby a GCA as the initiator of an unsolicited PPP Project proposal.

26. Environmental impact assessment, hereinafter referred to as AMDAL, is a

study pertaining to the significant impacts of a business and/or activityplanned in an environment necessarily for the process of decision making onthe undertaking of the business and/or activity.

27. Environmental Management Plans and Environmental Monitoring Plans,hereinafter referred to as UKL-UPL, are the management and monitoringagainst a business and/or activity that has no significant impact against theenvironment needed for the process of decision making on the organizationof the business and/or activity.

28. Environmental Permit is a permit provided to every person performing abusiness and/or activity that is AMDAL or UKL-UPL compulsory in theframework of protecting and managing the environment as the preconditionto obtain a business licence and/or activity.

29. AMDAL Documents are the documents prepared by the Government and/orthe Regional Government and/or Business Entity and the preparation thereofshall be started in the PPP Project Preparation Phase and completed at the

same time with the completion of Pre-Feasibility Study comprising of ANDALterms of reference (KA-ANDAL), environmental impact analysis (ANDAL),and environmental management and monitoring plan (UKL and UPL).

30. Management Unit for the Implementation of PPP Contract, hereinafterreferred to as the Management Unit, is a working unit formed by the GCA toprepare and draw up the plan as well as carry out the Implementation



32. PPP Project Management Team is a task force of structural and/or functionalstaff formed within a working unit of Ministryl/Non-ministerial Institution in thecentral level or within some SKPD in the regional level, which has the roleand responsibility to manage a PPP Project in the Preparation andTransaction phases covering activities of preparing an Outline BusinessCase, assessment of Project Readiness and completion of the Pre-Feasibility Study.

D. Phasing of PPP Project Cycle

1. The PPP Project Cycle comprises four phases:

a. Planning of PPP Project;

b. Preparation of PPP Project;

c. Transaction of PPP Project; and

d. Implementation of PPP Contract Management.

2. The PPP Project Planning Phase as referred in point 1 letter a, comprises:

a. Identification and Selection of a PPP Project

Identification and selection of a PPP Project is intended to determine apotential infrastructure PPP project to be developed incooperation/partnership with a Business Entity using the approach ofneed analysis, compliance criteria and value for money of the

involvement of a business entity.b. Prioritization of PPP Project

Prioritization of PPP Project (for each respective Central and RegionalPPP Project) is intended to determine more important project to beprioritized by considering the aspect of public needs, budget capacity,development period and other strategic considerations.

3. Preparation of PPP Project as referred in point 1 letter b, comprises:

a. Preliminary Appraisal of Pre-Feasibility Study (the Outline BusinessCase):

The purpose of preparing and developing an Outline Business Case isto:

1) define the target and constraints of the PPP Project;



4) identify option of the best PPP modality;

5) identify the risks and mitigation efforts needed;6) identify the implementation requirements of the PPP Project,

including the legal basis needed and the implementation of landacquisition; and

7) draw up a commercial/business plan covering the risk allocation andpayment mechanism.

b. Assessment of PPP Project Readiness

Preparation for Assessment of Project Readiness is intended to:

1) ensure that the concept of PPP Project obtains an approval fromthe GCA and agreement from the stakeholders;

2) ensure that the proposal of request of non-fiscal GovernmentSupport has been submitted by the working unit of Ministry/Institution/work unit of regional officials to the Minister/ InstitutionalHead/ Regional Head if the results of Preliminary Appraisal of Pre-

Feasibility Study indicate the need of non-fiscal GovernmentSupport for the PPP Project;

3) ensure that the proposal of request of the Government Support inthe form of non-financial fiscal contribution has been submitted bythe GCA to the Minister of Finance in the event the results of thePreliminary Appraisal the Pre-Feasibility Study indicate the need ofGovernment Support in the form of non-financial fiscal contributionfor the PPP Project;

4) ensure that the proposal of request of the Government Support inthe form of financial (cash) fiscal contribution has been submittedby the GCA to the Minister of Finance in the event the results of theFinal Appraisal of the Pre-Feasibility Study (the Final BusinessCase) indicate the need of Government Support in the form offinancial fiscal contribution for the PPP Project;

5) ensure that the proposal of the Government Guarantee has been

submitted by the GCA to the BUPI, in the event the results ofPreliminary Appraisal of the Pre-Feasibility Study indicate the needof the Government Guarantee for the PPP Project;

6) ensure that the PPP Project Management Team has been formedand functioning;



9) ensure that the steps to settle various legal issues have beenprepared.

4. The Transaction of PPP Project as referred in point 1 letter c, covers:

a. Completion of Pre-Feasibility Study, comprises of:

1) Final Appraisal of Pre-Feasibility Study (the Final Business Case)

Preparation of the Final Appraisal of Pre-Feasibility Study isintended to:

a) ensure that the Project Preparation Report has obtained theapproval from the Minister/Head of Institution/Regional Headand consent from the stakeholders;

b) update and confirm the Outline Business Case;

c) confirm the technical conformity, cooperation selection, PPPProject readiness and market interest;

d) draw up detailed draft of output specification;

e) develop tariff structure;

f) ensure risk allocation, implementation mechanism ofGovernment Support and/or Government Guarantee andfinancial structure (deal structure);

g) prepare the draft of public tender plan of a Business Entity;

h) prepare the draft of provisions of PPP Contract;

i) ensure whether the Government Support for the PPP Contract isnecessary or not needed.

2) Draft of Public Tender Plan of a Business Entity

Draft of public tender plan of a Business Entity is intended to preparethe proposal of public tender strategy, requirements of theinstitution/agency that will manage the public tender process, andrequirements to be specified in the Tender Documents.

b. Public Tender of a Business Entity comprises of:

1) planning of public tender;

2) implementation of public tender:

a) request for Expression of Interest;

b) request for Prequalification;



5. The Implementation of PPP Contract Management as referred in point 1letter d covers:

a. Planning for Implementation of PPP Contract Management; and

b. Implementation of PPP Contract Management.

Chart of the Phasing of PPP Project Development Cycle is summarized in Sub Attachment I hereof, forming one inseparable entity of this Ministerial Regulation.

E. Series of Activit ies related to the PPP Project Development Cycle

1. Series of activities related to PPP Project Development Cycle at the Central-Level.

Series of activities from the Planning phase to the Preparation andTransaction phases of the Central-level PPP Project up to theImplementation of the PPP Contract Management phase shall comply to thefollowing sequence:

a. In the Planning Phase of the PPP Project, the head of working unit in theMinistry/Institution shall identify, select and determine priority of the PPPProject of sub-sector scope.

b. After completing the Planning of sub-sector scope of PPP Project, thehead of working unit in the Ministry/Institution shall submit the proposalof the said PPP Project to the Minister/Institutional Head through thePPP Node in the Ministry/Institution for the determination of priority of

the sub-sector scope PPP Project and to be followed up with the PublicConsultation and the completion of Preliminary Study Documents.

c. The Public Consultation as refrerred in letter b may be carried outseveral times in each stage of the PPP Project.

d. The Public Consultation shall be determined by the GCA, and shall atleast discuss the following:

1) elucidation and elaboration related to the PPP Project by the GCA,

which may be assisted by consultant;2) acceptance of response and/or input from representative of the

public which attends the Public Consultation; and

3) evaluation of the results obtained from the Public Consultation andthe implementation thereof in the PPP Project.



Ministry/Institution to the working unit in the Ministry/Institution to becontinued to the PPP Project Preparation Phase.

g. The Minister/Institutional Head as the GCA upon determining priority ofthe sector scope PPP Project shall submit the said List of Priority of thePPP Project including the Preliminary Study Documents to the Ministerof Planning to be proposed and registered in the PPP Book as aPotential PPP Project.

h. The GCA shall continue the process to the next phase of PPP ProjectPreparation by conducting and completing the Preliminary Appraisal of

Pre-Feasibility Study (theOutline Business Case) to be then continuedby implementing the Assessment of the Project Readiness.

i. At the end of the PPP Project Preparation phase, the GCA producesDocuments of Project Preparation containing results of the preliminaryassessment of pre-feasibility study (the outline business case) andassessment of project readiness.

j. In the event the result of the Outline Business Case and the assessmentof Project Readiness are declared that the said project is not financiallyfeasible (after calculating the needs of the Government Support), thenthe said project shall be declared not feasible as a PPP Project and shallnot proceed to the next phase of PPP Project Transaction . In that case,the said project may be endorsed as a non PPP Project.

k. In the event the result of the Outline Business Case and the assessmentof Project Readiness Study are declared that the said project istechnically, economically and financially feasible, then the GCA may

proceed to the next phase of PPP Project Transaction for the completionof the Pre-Feasibility Study.

l. The GCA shall submit the List of PPP Projects having completed theDocument of the PPP Project Preparation to the Minister of Planning tobe registered in the PPP Book as a prospective PPP project.

m. The GCA shall complete Documents of the Pre-Feasibility Studycontaining results of the Final Assessment of Pre-Feasibility Study (theFinal Business Case) including financial structure, draft of provisions of

the PPP Contract, and draft of the public tender plan of the BusinessEntity including the public tender strategy (bid strategy) and draft ofTender Documents.

n. Documents of the Pre-Feasibility Study shall be attached with AMDALDocuments for the PPP Project which is required to carry out the



out the AMDAL or recommendation of the UKL-UPL for a PPPProject which is required to have UKL-UPL from the Minister,

Governor or Head of Region in accordance with his/her authoritybased on the provisions of laws and regulations.

2) letter of designated project location from the Governor; and

3) in-principle approval to obtain the Government Support in the form offiscal contribution from the Minister of Finance and letter of intent forprovision of the Government Guarantee from the BUPI inaccordance with the provisions of the laws and regulations.

o. A PPP Project that already has completed the Pre-Feasibility StudyDocument and obtained the principle approval of the GovernmentSupport from the Minister of Finance shall be proposed by the GCA tothe Minister of Planning to be registered in the PPP Book as a ready-to-offer PPP Project.

p. The GCA shall prepare and carry out the public tender of the BusinessEntity for the ready-to-offer PPP Project. In the event the PPP Projectneeds the fiscal support to ensure the financial feasibility of the PPPProject, the GCA shall submit the request of preliminary determinationfor provision of the fiscal support to the Minister of Finance inaccordance with prevailing the laws and regulations.

q. The GCA shall continue to the next phase of the Implementation of PPPContract Management after the PPP Contract has been signed.

The flowchart of the complete phasing of the PPP Project DevelopmentCycle at the Central level is summarized in Sub Attachment II that forms one

entirety inseparable of this Ministerial Regulation.

2. Series of PPP Project Development Cycle at the Regional Level.

Series of activities from the Planning phase to the Project Preparation andTransaction phases of developing PPP Project at the Regional level up tothe Implementation of PPP Contract Management phase shall comply to thefollowing sequence:

a. The TKKSD, through the PPP Node, shall make coordination andevaluation of the projects initiated by the Regional Government WorkingUnit (SKPD) in charge of the infrastructure sector.

b. Each SKPD of infrastructure sector shall identify, select and determineth i it f th PPP P j t f b t / t th b i t



d. Public Consultation as referred in letter c may be carried out severaltimes in each phase of the PPP Project Cycle.

e. Public Consultation shall be determined by the GCA, and shall at leastdiscuss the following:

1) elucidation and elaboration related to the PPP Project by the GCAthat may be assisted by consultant; and

2) acceptance of response and/or input from the representative ofpublic which attends the Public Consultation event; and

3) evaluation of the result obtained from the Public Consultation andthe implementation thereof in the PPP Project.

f. The TKKSD, through the PPP Node, shall prepare the priority of cross-SKPD PPP Projects, through consultation and clarification with allrelated SKPDs and the Regional Parliaments (DPRD), preparerecommendation to the Head of Region in order to make decisionpertaining to the determination of list of priority of the Regional PPPProject plan.

g. The SKPD-scope PPP Projects included in the list of priority of theRegional PPP Project plan shall be re-submitted by the TKKSD, throughthe PPP Node, to each SKPD to be continued to the next Phase of PPPProject Preparation.

h. The Head of Region as the GCA shall submit the list of priority of theRegional PPP Project plan which has been furnished with thePreliminary Study Documents to the Minister of Planning to be proposedand registered in the PPP Book as a Potential PPP Project.

i. The GCA shall continue the process to the next Phase of PPP ProjectPreparation by first carrying out and completing the Outline BusinessCase to be followed by conducting the assessment of the PPP ProjectReadiness.

j. In the PPP Project Preparation Phase, the GCA shall produce a ProjectPreparation Document which contains the results of Preliminary Appraisal of Pre-Feasibility Study (the Outline Business Case) and

assessment of project readiness.

k. In the event the result of the Outline Business Case and assessment ofproject readiness declare that the said PPP Project is not financiallyfeasible (after calculating the needs of the Government Support), thenthe said project shall be declared not feasible as a PPP Project and the



completion process of the Pre-FeasibilityStudy at the PPP ProjectTransaction phase.

m. The GCA shall submit the list of PPP Projects having completed the PPPProject Preparation Document to the Minister of Planning to be proposedand registered in the PPP Book as prospective PPP projects.

n. To finalize the Pre-Feasibility Study at the Transaction phase, the GCAshall first conduct the Final Business Case which is primarily aimed toprepare the financial structure in order to ensure that the PPP Projectwill be successfully transacted, including to prepare the draft of

provisions of the PPP Contract.o. The GCA shall complete the Pre-Feasibility Study Documents by

enclosing:

1) AMDAL documents (Terms of Reference, ANDAL, RKL-RPL) for aPPP Project that is AMDAL compulsory;

2) UKL-UPL form for a PPP Project that is UKL-UPL compulsory;

3) documents of land acquisition and resettlement plan;

4) the SKKL and Environmental Permit from the Minister, Governor orHead of Region in accordance with his/her authority for a PPPProject that is AMDAL compulsory;

5) recommendation of UKL-UPL from the Minister, Governor or Head ofRegion in accordance with his/her authority for a PPP Project that is AMDAL compulsory;

6) letter of designated project location from the Governor; and

7) if necessary, submission of application for in-principle approval ofthe Regional Government Support from the Head of Region and theDPRD, in-principle approval of Government Support in the form offiscal contribution from the Minister of Finance and statement ofreadiness to provide guarantee from the BUPI in accordance withthe provisions of laws and regulations.

p. A PPP Project that has completed the Pre-Feasibility Study and obtained

in-principle approval of the Regional Government Support from the Headof Region and the DPRD having gone through the process of plenarysession, and/or in-principle approval of the Government Support in theform of fiscal contribution from the Minister of Finance and/or statementof readiness toprovide guarantee from the BUPI, the GCA may continueto the process of public tender of the Business Entity



requires fiscal support from the Minister of Finance, the GCA shallsubmit a request for the initial approval of provision of the fiscal support

(in terms of a viability gap support) to the Minister of Finance inaccordance with the prevailing laws and regulations.

s. The GCA shall continue to the next phase of the Implementation PPPContract Management after the PPP Contract has been signed.

The flowchart of the complete cycle of PPP Project Development at theregional level is summarized in Sub Attachment III forming one entiretyinseparable of this Ministerial Regulation.

3. Supporting Activities of Implementation of PPP Project

a. In carrying out the four-phase of PPP Project cycle, the GCA shall at thesame time conduct supporting activities to the implementation process ofPPP Project development.

b. The supporting activities referred to above include the followings but notlimited to:

1) The planning as well as implementation activities of land acquisitionand resettlement;

2) The environmental impact asseessment; and

3) The request for the provision of Government Support and/orGovernment Guarantee.

c. The GCA may conduct planning and implementation activities of land

acquisition and resettlement since the Planning Phase of PPP Projectcycle by performing a preliminary identification and requirement of land,to be then followed by the process of producing a document of landacquisition plan at the PPP Project Preparation phase and the processto obtain a designated project location from the Governor.

d. The GCA shall carry out the land acquisition, including resettlementplanning, in compliance with the provisions of laws and regulations thatregulate land acquisition for development for public interests.

e. The GCA may carry out activities of environmental study since thePlanning phase by conducting a screening process whether the projectrequires AMDAL or UKL-UPL compulsory, and prepare the terms ofreference for procurement of AMDAL consultant for projects that are AMDAL compulsory.



g. For projects of UKL-UPL compulsory, the GCA shall only fill in the UKL-UPL form which becomes the basis of issuance of recommendation from

the Minister, Governor or Regional Head.

h. The GCA may indicate the need for Government Support and/orGovernment Guarantee since the Planning phase by identifying theinitial requirements of the Government Support and/or GovernmentGuarantee.

i. The GCA shall determine the form and more quantifiable amount of theGovernment Support in the Outline Business Case. For the Government

Support in the form of fiscal support (viability gap funding), the GCA shallsubmit fiscal support request to the Minister of Finance according to theprevailing laws and regulations.

j. The Government Support in the form of fiscal support (viability gapfunding) shall only be provided to the PPP Project that has alreadyregistered as the ready-to-offer PPP project category of the PPP Bookand the in-principle approval of provision of the said fiscal support(viability gap funding) shall be explicitly incorporated to the Public

Tender Documents. The amount of fiscal (viability gap) support shall beused as one of the bid parameters.

k. In the event the PPP Project is declared economically and financiallyfeasible and requires the Government Guarantee, then the GCA mayrequest the BUPI to obtain a statement of guarantee readiness. If theresult of due diligence conducted by the BUPI indicates good financialstructure, the BUPI may issue an in-principle approval at the time offinalization process of bid documents.

The figure of the complete cycle of PPP Project development with the keysupporting activities is summarized in Sub Attachment IV constituting oneentirity and inseparable part of this Ministerial Regulation.

4. Consultant’s Tasks in the Implementation of PPP Project:

a. In respect to the Implementation of PPP Project, the consultant is in

charge of among others:1) supporting the GCA in collecting information pertaining to

infrastructure necessity;

2) providing inputs to the GCA pertaining to the creation of projectprofile after the GCA identified the project;



5) providing inputs to the GCA among others pertaining to financialanalysis, need analysis, technical analysis and others required to

ensure that the PPP Project is being well prepared;

6) assisting the GCA in updating the Outline Business Case to befinalized as the Final Business Case and in finishing the Pre-Feasibility Study Document;

7) assisting the GCA in preparing the draft of PPP Contract;

8) providing advisory support to the Procurement Committee at theTransaction phase, including achieving the deal structure.

b. In respect to the preparation of AMDAL, the consultant which assists theGCA (either individual or institutional AMDAL consultant) shall havepossession of a certification of competency and be registered in theMinistry of Environment.

5. Costs associated with PPP Project Development Cycle.

a. The costs arising from developing PPP Project for pproject preparationand transaction including the implementation of Procurement of

Business Entity may be imposed to the tender winner.

b. The arising costs as intended in letter a above covers:

1) costs for preparing the Pre-Feasibility Study and/or Transaction ofPPP Project until the financial close is achieved; and

2) a reasonable fee for the institution assigned by the Government tocarry out consulting and advisory services for the GCA.

c. The reasonable fee as intended in letter b point 2) may be providedthrough the success fee mechanism.

d. The amount of reasonable fee shall be determined under the agreementbetween the related agency/institution with the GCA.

e. The amount of costs charged to the tender winner shall be specified inthe Tender Documents.

F. Related Regulations

1. Law Number 36 of 1999 on Telecommunication.

2. Law Number 22 of 2001 on Natural Oil and Gas.

3. Law Number 7 of 2004 on Water Resources.

4. Law Number 25 of 2004 on National Development Planning System.



10. Law Number 26 of 2007 on Spatial Planning.

11. Law Number 1 of 2009 on Aviation.12. Law Number 30 of 2009 on Electricity.

13. Law Number 32 of 2009 on Environmental Protection and Management.

14. Law Number 2 of 2012 on Land Acquisition for Development for PublicInterests.

15. Government Regulation Number 20 of 2004 on Government Work Plan.

16. Government Regulation Number 15 of 2005 on Toll Road as amended byGovernment Regulation Number 44 of 2009.

17. Government Regulation Number 16 of 2005 on Development of DrinkingWater Supply System.

18. Government Regulation Number 6 of 2006 on Management ofState/Regional Assets as amended by Government Regulation Number 38of 2008.

19. Government Regulation Number 40 of 2006 on Procedures of NationalDevelopment Plan Preparation.

20. Government Regulation Number 50 of 2007 on Procedures ofImplementation of Regional Cooperation.

21. Government Regulation Number 1 of 2008 on Government Investment.

22. Government Regulation Number 26 of 2008 on National Spatial Plan.

23. Government Regulation Number 56 of 2009 on the Conduct of Railway

Business.

24. Government Regulation Number 61 of 2009 on Harbour.

25. Government Regulation Number 72 of 2009 on Traffic and RailwayTransportation.

26. Government Regulation Number 27 of 2012 on Environmental Permit.

27. Government Regulation Number 14 of 2012 on Electricity Supply Business Activities.

28. Government Regulation Number 40 of 2012 on Development andPreservation of Airport Environment.

29. Regulation of the President Number 67 of 2005 on Public-PrivatePartnerships the Provision of Infrastructure as having been amended



32. Regulation of the President Number 24 of 2010 on Position, Tasks andFunctions of the State Ministry and Organization Structure, Tasks and

Function of Echelon I.

33. Regulation of the President Number 5 of 2010 on National Mid-TermDevelopment Plan of 2010-2014.

34. Regulation of the President Number 78 of 2010 on InfrastructureGuarantee for Cooperation Project between the Government and BusinessEntity carried out through Infrastructure Security Business Entity.

35. Regulation of the State Minister of Environmental Number 11 of 2006 on

Business Plan and/or Activities that shall be completed with Analysis OnEnvironmental Impacts.

36. Regulation of the State Minister of National Development Planning/Head ofNational Development Planning Agency Number PER.005/M.PPN/10/2007on Organization and Work Procedures of the State Ministry of NationalDevelopment Planning/National Development Planning Agency.

37. Regulation of the State Minister of Environmental Number 5 of 2008 on

Work Procedures of Analysis Assessor Commission On EnvironmentalImpacts.

38. Regulation of the Minister of Home Affairs Number 22 of 2009 on TechnicalGuidelines of Regional Cooperation Work Procedures.

39. Regulation of the Minister of Finance Number 260/PMK.011 of 2010 onGuidelines of Implementation of Infrastructure Guarantee for PPP projectsin the Provision of Infrastructure.

40. Regulation of the State Minister of Environmental Number 7 of 2010 onCertification of Competency of AMDAL Document Maker and LPK’srequirements of AMDAL Document Maker.



CHAPTER II

THE PROJECT PLANNING PHASE OF THE PPP PROJECTCYCLE

A. General Provis ions

1. The Planning Phase of the PPP Project Cycle is intended to:

a. obtain clear and accurate picture pertaining to whether or not it isnecessary that the development of some infrastructure, conformity ofthe PPP Project with the National Mid-Term Development Plan,Government Work Plan, Strategic Plan and Work Plan of Ministry/Institution, and/or Regional Mid-Term Development Plan and RegionalGovernment Work Plan, in accordance with the laws and regulations,and the feasibility of a project to be cooperated with a Business Entity;

b. support the coordination of planning and development of the PPPProject plan as well as to provide transparent information to the public

concerning the plan of the PPP Project.2. The Planning Phase of the PPP Project Cycle comprises of process of

identification and selection of the PPP Project as well as determination ofthe PPP Project priority.

3. The process of identification and selection of the PPP Project as intendedin point 2 shall be conducted to provide description regarding the need tobuild some certain infrastructure to be made compatible with theGovernment work plan as well as the benefit thereof if it is cooperated with

a Business Entity.

4. Determination of the PPP Project priority as intended in point 2 shall becarried out by considering the aspect of public needs, budget, developmentperiod and other supporting aspects.

5. Identification and selection of the PPP Project as well as determination ofthe PPP Project priority are used as the basis by the GCA to prepare aPreliminary Study Document and terms of reference for the procurement of

consultant for a PPP Project Preparation, if necessary.6. In the event the PPP Project requires AMDAL, the GCA shall include

activities of study related to environment within the terms of reference forthe procurement of consultant for the preparation of PPP Project. Inpreparation of the AMDAL documents, the GCA may use the service of a



Government and activities of environmental study in accordance with thelaws and regulations.

B. Identification and Selection of PPP Project

1. Identification and selection of potential PPP Project to be cooperated withBusiness Entity:

a. the PPP Project initiated by the Central Government shall beconducted by the head of working unit of the GCA authorized on thePPP Project, namely the Director General/ Institutional Head orPresident Director of the BUMN in the event being given the authority

based on the laws and regulations.

b. as to a PPP Project initiated by the Regional Government, it shall becarried out by the Provincial/Local Government Working Unit (SKPD).

2. The process of identification and selection of PPP Project as intended inpoint 1 shall be carried out through a screening process using the approachof:

a. need analysis;

b. compliance analysis; and

c. decisive factors criteria of the advantage of business-entityinvolvement.

3. Indicators of Need Analysis as intended in point 2 letter a, include:

a. consistency that the PPP Project is included in the government

development plan and program;

b. certainty that the PPP Project has the technical and economicreasoning basis;

c. dependability that the PPP Project obtains the support from the relatedstakeholders; and

d. predictability that the PPP Project has continuous demand measuredfrom inadequacy of service, both the quantity and quality as well as the

community’s ability to pay.

4. Compliance Criteria as intended in letter 2 letter b, include:

a. the compliance of the PPP Project with the national/ regional mid-termd l t l d th i f t t t t t i l



a. investment value that needs effective risk management;

b. private sector that owns superiority in the Implementation of PPPProject;

c. ensuring the effectiveness, equity, and accountability of service in thelong term;

d. technology and other aspects in the related sector that are stable andadaptive to changes; and

e. availability of attractive incentives for the private sector.

C. Prioritization of PPP Projects

1. After identifying and selecting the PPP Project, the GCA shall determinethe priority of the PPP Projects.

2. Prioritization of the PPP Projects as intended in point 1 shall use the Multi-Criteria Analysis (AMK) method.

3. The AMK Criteria shall at least include:

a. clarity of description of the PPP Project;

b. obstacles to gain access to the main resources for the Implementationof PPP Project;

c. clarity of the result of the PPP Project inputs;

d. social and environmental impacts that are able to be managed andcontrolled;

e. continuous potential demand;

f. potential of facility of land acquisition and resettlement;

g. level of government’s ability to give the government support;

h. institutional aspect readiness; and

i. the inclusion of PPP Project in strategic priority and/ or governmentplanning;

4. For the PPP Project initiated by the Central Government, the GCA shalldetermine priority by complying the following sequence:

a. The head of work unit of the Ministry/ Institution or the PresidentDirector of the BUMN, as the responsible working unit of the GCAauthorised for the PPP Project shall determine priority of the proposed



c. The PPP Node shall evaluate the prioritization of the proposed PPPProjects of all sub-sectors in its ministry and shall recommend the

priority of the proposed PPP Projects within its ministry scope..

d. The PPP Node shall submit the recommended prioritization of theproposed ministerial PPP Projects to the respective Minister/ Head ofInstitution.

e. The Minister/ Head of Institution shall make final decision on the list ofpriority of its respective ministerial PPP Projects.

f. The Minister/ Head of Institution shall submit the list of priority of its

respective ministerial PPP Projects plan to the Minister of Planningenclosed with the related complete documents.

g. The Minister of Planning shall evaluate the list of priority of theministerial PPP Projects plan including the related complete documentsin accordance to the prevailing laws and regulations.

h. The Minister of Planning based on the result of evaluation of the list ofpriority of the ministerial PPP Projects plan shall determine the

appropriate category status of each PPP project to be registered in theList of Infrastructure Project Plan (the PPP Book).

5. For the PPP Project initiated by the Regional (Provincial/Local)Government, the GCA shall determine the priority by being consistent withthe following sequence:

a. The head of SKPD as responsible working unit in infrastructure sectorof the GCA authorized for the PPP Project, shall ascertain theprioritization of the proposed PPP Projects of its respective SKPD

scope, after coordinating with the related ministry.

b. The head of SKPD as intended in letter a, shall submit the list of priorityof the proposed PPP Project plan of the related SKPD scope to theHead of Region through the TKKSD.

c. The TKKSD, through the PPP Node, shall evaluate the cross SKPDprioritization of the proposed PPP Projects and shall recommendpriority of its proposed regional PPP Projects.

d. The TKKSD shall submit the recommended prioritization of theproposed cross-SKPD PPP Projects to the Head of Region as the listof priority of its regional PPP Projects plan.

e. The Head of Region shall make the final decision for the list of priorityof its regional PPP Projects plan



h. The Minister of Planning shall evaluate the list of priority of the regionalPPP Projects plan in accordance to the prevailing laws and regulations.

i. The Minister of Planning shall determine the appropriate categorystatus of each project to be registered in the PPP Book based on theresults of evaluation on the list of priority of the regional PPP Projectsplan.

D. Decision Making for Go or Not Go of the proposed PPP Project toproceed to the Project Preparation Phase of the PPP Project Cycle

1. From the results of evaluation of the Preliminary Study, a PPP Project isdeclared not fulfilling the requirements as a project priority for PPP if it doesnot fulfil the requirements of the need analysis, compliance criteria,decisive factors criteria of the advantage of business entity’s involvementas well as earning a low score from the multi criteria analysis (the MCA).

2. A PPP Project which has fulfilled the requirements as a priority project forPPP shall be entered into the List of Project Priority and shall proceed to

the next phase of Project Preparation.

E. Supporting Activities During Project Planning Phase

1. Activities related to environmental study

a. In the event consultant assistance is needed, the GCA shall preparethe terms of reference for consultant procurement.

b. Consultant as intended in letter a is in charge of:1) preparation of AMDAL documents, comprising of Terms of

Reference, Andal, and RKL-RPL for the PPP Project that requires AMDAL; and

2) filling in the UKL-UPL form for the PPP Project that requires UKL-UPL.

c. Consultant as intended in letter a shall have a certification of

competency as the maker of the AMDAL documents and is registeredin the Ministry of Environment.

d. Criteria of the PPP Project that requires AMDAL and/or UKL-UPL isregulated in the laws and regulations related to environment.



b. initial estimate of the costs needed to clear the required land as well asscreening pertaining to whether or not resettlement plan is necessary in

accordance with the laws and regulations; and

c. preparation of plan and schedule to carry out the program of landacquisition and resettlement.

3. Activities related to the need of the Government Support and/orGovernment Guarantee.

The GCA shall carry out activities of study of the need of the GovernmentSupport and/or Government Guarantee, comprising of:

a. initial identification of the need of the Government Support and thedocuments required in order to obtain an approval; and

b. initial identification of the need of the Government Guarantee and thedocuments required in order to obtain an approval.

F. Documents Generated in Project Planning Phase

1. The documents that should be prepared in the Planning Phase of PPPProject development are:

a. A Preliminary Study document; and

b. Terms of reference for procurement of consultant, if a consultancyservice is needed in this stage.

2. The Document of Preliminary Study as intended in point 1 letter a, shall atleast includes:

a. background of the PPP Project;

b. description of the PPP Project, covering at least the legal basis,present condition of the PPP Project, and problems of infrastructureneeds;

c. benefits of the PPP Project, covering at least concept of the PPPProject, potential to be cooperated, indication of technical feasibility,indication of economic feasibility, potential of obstacles and

environment, result of public consultation and project managementneeds;

d. scope of work and method of procurement selection; and

e. preliminary identification of project location and the need of land size.



d. documents to be prepared and delivered;

e. implementation schedule; and

f. costs estimation.



CHAPTER III

THE PROJECT PREPARATION PHASE OF THE PPP PROJECT CYCLE


1. The GCA shall carry out the Preparation of PPP Project after identifying,selecting and determining the PPP Project priority.

2. The Preparation of PPP Project referred to in number 1 is intended toensure that the GCA has the capacity and ability to carry out the PPP

Project, transfer of risks from the GCA to the Business Entity uponthorough study, and provide benefits for the public.

3. The PPP Project Preparation Phase comprises of:

a. Preparation of the Preliminary Appraisal of Pre- Feasibility Study ordeveloping the Outline Business Case, is aimed to:

1) determine the target and obstacles of the PPP Project;

2) study the technical option and the availability of technology andgoods/ services needed;

3) determine various main problems and the obstacles thereof,proposal to overcome problems as well as the form and amount ofthe Government Support and/or Government Guarantee;

4) identify the choice of the best modality;

5) preparation of the commercial plan covering the preliminary draft ofthe term sheets of the PPP Contract, risk allocation and paymentmechanism;

6) determine the risks and mitigation efforts needed; and

7) determine the requirements of the PPP Project implementation,including the legal basis needed in relation to the land acquisitionand resettlement.

b. Preparation of the assessment of Project Readiness, is aimed toensure that:

1) the concept of the PPP Project obtains an approval from thestakeholders;

2) the proposed request of Government Support has been submittedby the GCA to the Minister/ Head of Institution/ Head of Region



4) the PPP Project Management Team has been formed andfunctioning;

5) the plan and schedule of the site preparation program (includingthe land acquisition) and resettlement program have beenprepared, including the draft of budget plan and the implementationschedule thereof have been proposed in the RKP/RKPD, the planand schedule of the environmental compliance program have beenprepared; and

6) steps to settle various legal problems have been prepared.

4. The Outline Business Case and assessment of Project Readiness alreadyprepared shall be used as the basis by GCA to prepare the Document ofthe PPP Project Preparation.

5. In addition to preparation of the Document of the PPP Project Preparation,the GCA shall conduct several other supporting activities such ascompletion of preparation of the AMDAL Documents or filling the UKL-UPLforms as well as the preparation of documents of land acquisition andresettlement plan.

6. The costs arising in the preparation of the Preliminary Appraisal of Pre-Feasibility Study and assessment off Project Readiness Study may beimposed to the tender winner by the GCA. In the event the costs referredto is imposed to the tender winner, then the tender winner may calculatethe charge as one of the cost components of the PPP total project costs.

B. Preparation of the Preliminary Appraisal of Pre-Feasibili ty Study

Documents

1. The preparation for the Preliminary Appraisal of Pre-Feasibility Study (theOutline Business Case) shall be conducted by the GCA.

The Preliminary Appraisal of Pre-Feasibility Study as referred in number 1comprises of:

a. Legal and Institutional Study;

b. Technical Study;c. Project Feasibility Study;

d. Environmental and Social Study;

e. Study of Cooperation Form in Infrastructure Provision; and



2) Institutional analysis.

b. Analysis of Laws and Regulations referred in letter a number 1) isconducted with the purpose to:

1) ensure that the PPP Project is carried out according to the lawsand regulations;

2) determine the legal risks and mitigation strategy thereof;

3) examine the possibility of improving the laws and regulations, or toissue new laws and regulations;

4) prepare the plan and schedule to overcome the problems ofregulations and law;

5) determine type of permit/ agreement required; and

6) ensure that the PPP Project is carried out in accordance with thelaws and regulations, among others those related to:

a) the establishment of Business Entity;

b) investment;

c) business competition;

d) environment;

e) work safety;

f) land acquisition;

g) funding of PPP Project;

h) permits of PPP Project;i) tariff mechanism and the adjustment thereof;

j) taxation; and

k) other related regulations.

c. Institutional Analysis as referred in letter a number 2) shall beconducted under following the steps:

1) ensure the GCA’s authority in carrying out the PPP Project;

2) determine the role and responsibility of the institutions related tothe implementation of the PPP Project;

3) determine the role and responsibility of the PPP ProjectManagement Team, and the reporting system;



1) Technical Analysis;

2) Site Enablement;

3) Basic Engineering Design;

4) Scope of Cooperation Design; and

5) Output Specification.

b. Technical Analysis referred to in letter a number 1) is intended to:

1) determine the operational technical performance standardsneeded;

2) prepare analysis of project added value determination;

3) consider various site alternatives, project amount, quality,technology and time of implementation;

4) determine the output capacity needed and the operationalstandard, as well as to prepare basic engineering design that istechnically appropriate;

5) identify and asses the State and/or Region Owned Assets neededand to prepare the list of State and/or Region Owned Assets to beused for the PPP Project;

6) identify the requirements and availability of inputs at least coveringthe staff, raw materials, services, and access to the site;

7) determine the basis of project’s costs estimation;

8) estimate and determine the revenue, capital costs, operational

costs and maintenance of various scenarios;9) prepare the funding plan to be adjustable to the construction

schedule, operational estimate and maintenance, as wellestimation of continuous cycle costs of the project; and

10) identify the Minimum Service Standard for various scenarios.

c. The Site Enablement as referred in letter a number 2) shall be carriedout by considering:

1) conformity of the site with the regional spatial plan;

2) conformity of the site with the operational needs and raw materials;

3) availability of services and raw materials;

4) confirmation of land ownership and existing hindrances;



d. Basic Engineering Design as referred in letter a number 3), containingthe basic engineering design of the PPP Project that is adjusted to the

needs and characteristics of each sector;e. Scope of the PPP Project as referred in letter a number 4) shall be

determined by:

1) determining the project site and assumption of the project costsproposed:

2) determining the outputs to be produced by the project, amongothers:

a) main users and benefits obtained;

b) output specifications; and

c) tariff and payment structure.

3) Determining the main performance indicators for outputs andminimum standard to be achieved; and

4) Determining procedures of arrangement, monitoring and control of

the PPP Contract.f. Output Specifications as referred in letter a number 5) includes:

1) minimum standards of quality and availability;

2) optimum service network;

3) tariff structure, service payment and penalty;

4) indicative schedule for civil works and equipment;

5) site and obstacles in construction implementation;

6) access requirements and service benefits;

7) compliance requirements on environmental and safety problems;

8) requirements of transfer of assets according to the PPP Contract;

9) Key Performance Indicators; and

10) monitoring arrangement, in each stage of:

a) construction;

b) commercial operation; and

c) expiration of the PPP Project.



3) Financial Analysis;

4) Risk Analysis; and

5) Analysis of the Tariff Structure.

b. The SCBA as referred in letter a number 1) shall be carried out byfulfilling the provisions below:

1) The SCBA is aimed to ensure the social benefit and economicsustainability of a project related to the effectiveness, timeliness,fund use and public resources during the project period.

2) The SCBA is carried using the following approaches:a) cost ratio between the presence of the PPP Project and the

absence the PPP Project;

b) The costs referred to in letter a) cover:

(1) costs of the PPP Project development;

(2) investment costs;

(3) operational costs;(4) annual maintenance costs;

(5) replacement costs/periodical maintenance costs; and

(6) costs of losses on environmental and social impacts inwhich the said cost calculation is based on constant prices.

c) determination of economic benefit is done by converting thefinancial price into the economic (shadow price) for each inputs

and outputs based on the appropriate economic conversionfactors;

d) evaluation/ measurement of the project benefit impacts to thecommunity and country:

e) parameter of economic feasibility evaluation shall be carriedout through EIRR and ENPV approaches using the economicor social discount rate; and

f) sensitivity analysis to study the effect of uncertainty of theImplementation of PPP Project to the project economicfeasibility level.

3) The SCBA’s results may be used as indicators to measure thevalue of money benefit equal to the NPV maximum and other



level of services to be provided, related to the presence of interestfrom the investor to develop the PPP Project.

2) The Market Analysis is carried out by:

a) determining the level of services expected;

b) surveying the real demand to assess the estimate ofwillingness and ability to pay from users, standard of servicesneeded, and payment performance;

c) determining resources and growth level of demand usingvarious scenarios;

d) probing of interests of the prospective investors to the PPPProject;

e) assessing the response of prospective investor to the risks ofproject as well as the minimum level of the GovernmentSupport and/or the Government Guarantee needed;

f) assessing the response of the national and internationalfinancial institutions and/or other institutions to determine thecredit volume that may be allocated in the PPP Project; and

g) determining the strategic option to reduce the market risks.

d. Financial Analysis as referred in letter a number 3) shall be carried outby fulfilling the provisions below:

1) Financial Analysis is aimed to determine the financial feasibility of aPPP Project that is conducted based on the outputs from:

a) the macro economic analysis (exchange rate, inflation, andinterest rate);

b) the market analysis on the goods and services produced;

c) the investment cost analysis comprising of the project costs,interest assumption and escalation; and

d) calculation of all costs of resettlement, environmentalmaintenance, permits, and indirect costs (management

overhead costs).2) Financial Analysis shall be conducted by:

a) determining the level of Financial Internal Rate of Return(FIRR) in the PPP Project;



d) determining the amount of Return On Equity (ROE);

e) ensuring that the project’s cash flow has included the costs of

risk mitigation;

f) ensuring that the project’s cash flow is adjusted to the level ofrevenue, operational costs, tax after depreciation, and capitalexpenditure;

g) presenting various scenarios of financial analysis in rupiah orforeign currency of which the value is equated with the rupiah;and

h) determining the form and amount of the Government Supportand/or the Government Guarantee.

e. Risk Analysis as referred in letter a number 4) shall be carried out byfulfilling the following provisions:

1) Risk analysis is aimed to identify the risks and to allocate them tothe party mostly capable to overcome them.

2) Risk analysis is conducted by:

a) identifying the risks against:

(1) site availability;

(2) repatriation of profit;

(3) infrastructure construction and operation;

(4) commercial feasibility of infrastructure;

(5) laws and regulations;(6) supply of raw materials; and

(7) rights on track lane of the PPP Project (according to eachsector).

b) determining the risk allocation based on the type ofinfrastructure and costs that may incur from the GovernmentSupport and/or the Government Guarantee; and

c) determining the risk mitigation based on the amount of risksborne by the government or Business Entity;

f. Analysis of Tariff Structure as referred to in letter a number 5) shall becarried out by fulfilling the following provisions:



3) determining procedures and responsibilities for a review andadjustment of tariff during the period of the PPP Contract;

4) determining the amount of royalty payment, if Intellectual PropertyRights exist;

5) determining the terms and conditions of the contract and revenuesharing agreement between the Business Entity and the GCA incase:

a) cost overrun of the PPP Project value takes place;

b) development of the PPP Project is completed early; and

c) return of the PPP Project is in excess of the maximum leveldetermined, so that it is possible to apply the profit shareadditional mechanism (claw-back mechanism).

6) Environmental and Social Study

a. Environmental and Social Study as referred in number 2 letterd, includes:

1) The environmental study for the PPP Project that is AMDAL compulsory or UKL-UPL compulsory;

2) Social analysis; and

3) Land Acquisition and Resettlement Action Plan.

b. Environmental Study for the PPP Project that is AMDALcompulsory as referred in letter a number 1), shall be carriedout by adhering to the following provisions:

1) Conducting Preliminary Analysis of Environmental Impacts(Initial Environmental Examination or IEE) with the purposeto:

a) determine the environmental characteristics and theimpacts that would arise from the PPP Project;

b) determine the classification of the PPP Project inestimating the impacts that would be resulted to the

environment in accordance with the prevailing laws andregulations;

c) determine the enhancement of capacity and trainingprogram in order to carry out the environmentalprotection if necessary;

2) Th IEE i d th b i f id ti t



2) The IEE is used as the basis of consideration to preparethe Terms of Reference of the Environmental Impact

Analysis (KA-ANDAL).3) The procedures to conduct an environmental impact study

shall be carried out in accordance with the provisions oflaws and regulations in the environmental sector.

4) The GCA shall be responsible to prepare the AMDALDocuments for the PPP Project comprising of thedocuments of KA-ANDAL, ANDAL, and RKL-RPL as thebasis of evaluation for environmental permits from theMinister/ Regional Head in accordance with his/herauthority.

c. Environmental Study for the PPP Project that is compulsory tohave the UKL-UPL as referred in letter a number 1), shall becarried out in accordance with the following provisions:

1) fill in the forms covering:

a) identities of the initiator, namely the GCA or businessentity of the Prospective Initiator;

b) Business and/or activities Plan;

c) environmental impacts that may take place; and

d) program of management and monitoring ofenvironment.

2) the forms as referred in number 1 shall be submitted to:

a) Regent/Mayor, for the PPP Project located in 1 (one)regency/ city and in marine area at the furthest 1/3 (onethird) of the marine area of the provincial authority;

b) The Governor, for the PPP Project located in more than1 (one) regency/ city area within 1 (one) province; inthe cross regent/ city; and/or in the marine area at thefurthest 12 (twelve) miles from the coastline towardsthe open sea and/ or towards the archipelagic waters;

c) The Minister, for the PPP Project located in more than1 (one) provincial area; in the area of the Unitary Stateof the Republic of Indonesia that is still in dispute withanother country; in the marine area of more than 12

be submitted to the authorised official as the basis for



be submitted to the authorised official as the basis forissuing a permit to conduct the business or activities in

accordance with the laws and regulations in theenvironmental sector.

d. Social Analysis as referred in letter a number 2) is needed for:

1) determining the social impacts of the PPP Project to thecommunity and preparing the mitigation plan thereof;

2) determining the institution responsible for the landacquisition and resettlement;

3) determining the parties to be subject to the impacts of theproject and the compensation to be given if necessary;

4) estimating the institution’s capacity to pay thecompensation and implement the resettlement plan ifnecessary;

5) determining the training plan in order to carry out the socialprotection program to increase the capacity of the

community subject to the impacts.e. The Land Acquisition and Resettlement Action Plan as referred

in letter a number 3) shall observe the following provisions:

1) to be carried out by first preparing documents for the landacquisition plan.

2) the GCA shall be responsible to prepare documents for theland acquisition plan that constitutes the requirements to

obtain a determination letter of location from the Governor.3) the Environmental Permit is needed to obtain a

determination letter of location from the Governor, inaddition to the documents of the land acquisition plan.

4) the resettlement plan, which constitutes the part of the landacquisition plan, shall be prepared based on the laws andregulations.

7) Review of the Cooperation Forms (Modalities) in the Provision ofInfrastructure

Review of the Cooperation Form in the Provision of Infrastructureas referred in number 2 letter e, shall adhere to the followingprovisions:

2) build operate transfer;



2) build-operate-transfer;

3) build-transfer-operate;

4) rehabilitate-operate-transfer;

5) develop-operate-transfer; and

6) other forms of cooperation.

c. Selection of form of cooperation shall be made by consideringthe following factors:

1) assurance of availability of infrastructure in timely manner;

2) optimization of investment by Business Entity;

3) maximization of efficiency expected from the businessundertaking of infrastructure by Business Entity;

4) ability of Business Entity to conduct transaction; and

5) assurance of transfer of management and technical skills ofprivate sector to public sector.

8) Appraisal of the need of Government Support and/or GovernmentGuarantee as referred in number 2 letter f, includes:

a. Government Support aimed to improve the financial feasibilityof the PPP Project, which may be extended in the form of:

1) licencing;

2) land acquisition;

3) support of part of construction;

4) fiscal contribution in the form of cash and/or in the form ofnon-cash and/ or non fiscal; and/or

5) other forms in accordance with the laws and regulations.

b. Government Guarantee aimed to reduce the risks of BusinessEntity shall be provided by the Minister of Finance and/orInfrastructure Guarantor Business Entity (BUPI/IIGF) inaccordance with the laws and regulations.

C. Assessment of Project Readiness

1. Project Readiness assessment shall be conducted by the GCA.

c PPP Project Management Team has been formed legalized and



c. PPP Project Management Team has been formed, legalized andfunctioning in accordance with the determined roles and responsibilities ;

andd. preparation of the draft budget and schedule of implementation of site

enablement, resettlement, environmental compliance as well assettlement of legal issues.

D. Decision Making of Go or not Go for the proposed PPP Project toproceed to the Transaction Phase

1. In the event results of the Preliminary Appraisal of Pre-Feasibility Study(the Outline Business Case) and Project Readiness Assessment declarethat the PPP Project is technically, economically and financially feasible,the said project shall proceed to the Transaction Phase.

2. In the event the Preliminary Appraisal of Pre-Feasibility Study and theProject Readiness Assessment declare that the said PPP Project is nottechnically, economically and financially feasible, then the said project shall

not proceed to the Transaction Phase and the GCA may declare the saidproject as a non PPP Project.

E. Supporting Activities during the Project Preparation Phase

1. Activities related to environment

For PPP Project that is required to have the AMDAL, the GCA shallconduct the process of environmental study in the Projectf Preparation

Phase by following the AMDAL mechanism below:

a. Announcing the plan of activities and performing public consultationwith the community with regard to the environment in relation with theplan of the Implementation of PPP Project.

b. Consultation as intended in letter b is aimed to collect informationpertaining to the impacts received by the community around thelocation of plan of the Implementation of PPP Project if the PPP Project

is carried out.c. When the process of Preliminary Appraisal of Pre-Feasibility Study is

started and during the process of preparation of Project Readiness Assessment, the GCA, accompanied by the environmental consultant,shall start to conduct preparation for producing AMDAL or UKL-UPL

be carried out based on the recommendation provided by the



be carried out based on the recommendation provided by theauthorised agency.

2. Activities in relation to Land Acquisition

a. When the process of Preliminary Appraisal of Pre-Feasibility Study isstarted, the GCA shall prepare the plan of land acquisition andresettlement.

b. During the process of Project Readiness Assessment,

1) The GCA shall complete the documents of plan of land acquisitionand resettlement; and

2) The GCA shall start the process to obtain an approval on thebudget proposal and schedule of the Implementation of PPPProject based on the laws and regulations.

3. Activities in respect of the Government Support and/or GovernmentGuarantee.

a. When the process of Preliminary Appraisal of Pre-Feasibility Study isstarted, the GCA shall consult with the BUPI to obtain initial indication

of the need of guarantee for the PPP Project;

b. During the process of Project Readiness Assessment, the GCA shallprepare and submit a cover letter and form of screening for theapplication to obtain the Government Guarantee to the BUPI; and

c. The GCA shall ensure that the BUPI issues confirmation to proceed forthe PPP Project before the process of completion of the Pre-FeasibilityStudy at the Transaction Phase.

F. Documents Generated during the Project Preparation Phase

1. Documents generated during the Project Preparation Phase comprises of:

a. Report of the Preliminary Appraisal of Feasibility Pre-study (the OutlineBusiness Case); and

b. Report of the Project Readiness.

2. Report of Preliminary Appraisal of Pre- Feasibility Study as referred innumber 1 letter a, shall at least includes:

a. Executive Summary.

b. Introduction, covering:

3) Conclusion.



)

d. Technical Study, covering:


2) Site Enablement;

3) Basic Engineering Design;

4) Scope of PPP Project;

5) Output Specifications; and

6) Conclusions.

e. Project Feasibility Study, covering:

1) Analysis of Social Benefit Costs;

2) Market Analysis;

3) Financial Analysis;

4) Risk Analysis;

5) Tariff Structure Analysis; and6) Conclusions.

f. Environmental and Social Study, covering:

1) Environmental Analysis;

2) Social Analysis;

3) Plan of Land Acquisition and Resettlement; and

4) Conclusions.

g. Cooperation Form (Choice of Modality) Review in InfrastructureProvision.

h. Appraisal of the Needs for Government Support and/or GovernmentGuarantee, covering:

1) Appraisal on Government Support;

2) Appraisal on Government Guarantee; and3) Conclusions.

i. Conclusions and Recommendations.

j. Attachments.

1) Formation of PPP Project Management Team; and



) j g

2) Preparation of Work Plan.

c. Site Readiness, covering:

1) Program to overcome obstacles in preparation of site; and

2) Land Acquisition Program.

d. Readiness of resettlement plan, covering:

1) Resettlement plan; and

2) Institution involves in the resettlement plan.

e. Readiness to obtain the environmental permit, covering:

1) Status of the AMDAL progress; and

2) Identification of obstacles that need to be studied further.

f. Legal Study pertaining to the status of licensing arrangement in respectof the PPP Project.

g. Readiness of obtaining the Government Support and/or GovernmentGuarantee, covering:

1) Status of obtaining the Government Support, with regard towhether the application to obtain the in-principle approval has beensubmitted to the Government and how the status of the saidproposal submission is at the time of the preparation of the Reportof Project Readiness; and/or

2) Status of obtaining the Government Guarantee, with regard to

whether the BUPI has issued confirmation to proceed for the GCA.h. Conclusions and Recommendations.

i. Attachments.

4. The Project Preparation Documents shall at least illustrate:

a. The feasibility of the project related to the cost and risk analysis;

b. The feasibility of social benefits, market interest;

c. The need of the Government Support and/or Guarantee; and

d. Analysis pertaining to the environmental and social impacts, as well asthe plan of land acquisition and resettlement program.

5. Terms of Reference for Procurement of Consultant for the Transaction of

d. General and primary tasks of the Consultant for the Preparation of a



draft PPP Contract;

e. Work schedule and report produced.

6. The AMDAL documents which are prepared based on the laws andregulations prevailing in the environmental sector.

7. Documents of land acquisition and resettlement plan prepared based onthe laws and regulations prevailing in the land sector.

CHAPTER IV



THE TRANSACTION PHASE OF THE PPP PROJECT CYCLE


1. The GCA shall continue to the Transaction Phase of the PPP Project Cycleafter the Project Preparation Document is declared feasible for PPP and isapproved by the Stakeholders.

2. The Transaction Phase of the PPP Project Cycle comprises of activities of

completion of the Pre-Feasibility Study and procurement of Business Entity.3. The completion of the Pre-Feasibility Study as referred in number 2 is aimed

to update and finalize all results of the Preliminary Appraisal of Pre-Feasibility Study (the Outline Business Case) and Project Readiness Assessment as well as to ensure the risk allocation, provision mechanism ofthe Government Support and/or Government Guarantee as well as fundingstructure of the PPP Project as the basis for generating the Pre-FeasibilityStudy Document.

4. The GCA shall continue to the process of procurement of Business Entityafter completing the Pre-Feasibility Study Document.

5. The procurement of Business Entity as referred in number 2 shall be carriedout with the purpose to obtain the best partner for the GCA in carrying outthe PPP Project based on the provisions of the laws and regulations andshall be conducted in compliance with the principles of fair competition.

6. The Procurement Committee is formed by the GCA after the completion of

the Pre-Feasibility Study Document.7. The Procurement Committee is formed to prepare and carry out the process

of Business Entity Procurement after completing the Document of Pre-Feasibility Study, starting from the process of prequalification, procurement,bid preparation and submission, evaluation and determination of winner, aswell as finalization of procurement by executing the PPP Contract.

8. In addition to finalizing the Document of Pre-Feasibility Study and conductthe procurement process of Business Entity, the GCA shall conductsupporting activities such as completion of the process of land acquisitionand resettlement.

9. The costs incurred in the Transaction phase covering the completion of theDocument of Pre-Feasibility Study and procurement of Business Entity by

B. Completion of Pre-Feasibil ity Study



1. The GCA shall conduct the Final Appraisal of Pre-Feasibility Study and

preparation of procurement plan design to complete the Documents of Pre-Feasibility Study used as the basis to prepare the Documents of PublicTender.

2. The Final Appraisal of Pre-Feasibility Study (the Final Business Case) shallbe conducted by completing components comprising of:

a. approval of the stakeholders pertaining to the PPP Project;

b. update and confirmation of the Preliminary Appraisal of Pre-Feasibility

Study (the Outline Business Case);

c. confirmation of the PPP Project readiness;

d. confirmation pertaining to the market interests;

e. determination of tariff structure;

f. confirmation pertaining to the availability of budget for the landacquisition; and

g. Decision on the implementation mechanism of Government Supportand/or Government Guarantee as well as the funding structure.

3. Preparation of the plan of procurement of Business Entity shall be carriedout by implementing and considering the following:

a. prepare the design of Business Entity procurement plan covering:

1) the plan to form a procurement committee;

2) list of prospective tender participants having the potential to join theprocurement, form of evaluation and criteria in evaluation tenderdocuments as well as procurement process;

3) plan of stages on the implementation of procurement, arrangementof implementation time on each stage and resources needed; and

4) procedures of calculating the amount of project value and tariffstructure.

b. preparation of the design of PPP Contract regarding the scope of thePPP Contract, rights and obligations of the parties, period of agreementand other matters under this Minister Regulation and matters mutuallyagreed by the parties.

4. The GCA shall explore market interest to obtain inputs and to know the

2. Procurement of Business Entity includes the activity of:



a. Business Entity Procurement Planning; and

b. Business Entity Procurement Implementation.

3. Business Entity Procurement Planning

a. Business Entity Procurement Planning comprises of 2 (two) activities,namely:

1) The formation of Procurement Committee; and

2) The preparation of Procurement Plan.

b. Procurement Commitee as intended in letter a number 1) shall beformed by the GCA by fulfilling the provisions below:

1) The GCA shall form Procurement Committee whose members shallbe in odd number of minimally 5 (five) persons consisting of thechairman, deputy chairman, and secretary who also functions as amember and several members.

2) Members of the Procurement Committee shall be derived from the

agency itself and may be derived from the related agency/workingunit and/or professionals.

3) One of the members of the Procurement Committee shall constitutea member of the PPP Project Management Team.

4) Members of the Procurement Committee shall at least consisting ofthe parties understanding, knowing and mastering:

a) the procurement procedures;

b) the scope of work of the PPP Project;c) the law of contract and provisions of laws and regulations

prevailing in the infrastructure field of the related sector;d) the technical aspects; ande) the financial aspects.

5) Members of Procurement Committee are not allowed to have any Affiliation relationship with members of another ProcurementCommittee or with the prospective tender participant, tender

participant or consultant.6) In the event at the time of implementation of procurement it is found

out that one of the members of Procurement Committee has an Affiliation relationship with a member of another ProcurementCommittee or with the prospective tender participant tender

In the event a decision cannot be made through a deliberation toreach consensus then the decision making shall be carried out



reach consensus then the decision making shall be carried out

based on majority votes (each member of the ProcurementCommittee has 1 (one) vote that may not be represented by anothermember of the Procurement Committee).

c. Preparation of procurement plan as intended in letter a number 2) shallbe carried out by the Procurement Committee through the followingactivities:

1) preparation of the procurement schedule and concept of theprocurement announcement;

2) preparation of the Prequalification Documents;

3) preparation of the HPS (owner’s estimate);

4) preparation of the Public Tender Documents; and

5) testing the market interest (market sounding).

d. Preparation of the Procurement Schedule and Procurement Announcement Concept as intended in letter c number 1) shall meet the

following provisions:

1) Procurement Committee shall prepare the schedule ofimplementation of the Business Entity’s procurement.

2) The schedule of implementation of the Business Entity’sprocurement shall provide sufficient time allocation to conduct allstages of the Business Entity’s procurement.

3) The Procurement Committee shall prepare the procurement

announcement concept.

e. The preparation of Prequalification Documents as intended in letter cnumber 2) shall fulfil the following provisions:

1) The Procurement Committee shall prepare the PrequalificationDocuments;

2) The Prequalification Documents shall at least contain the following:

a) summary or brief elucidation of the PPP Project;b) rights and obligations of prospective tender participants,

including the compensation of the prospective tenderparticipants if prequalification is cancelled after the results ofprequalification evaluation was cancelled.

3) The Prequalification Documents as intended in number 2) shall bedetermined by the GCA



determined by the GCA.

f. the preparation of HPS (owner’s estimate) as intended in letter c number3) shall fulfil the following provisions:

1) the Procurement Committee shall prepare HPS (owner’s estimate)thoroughly based on the report of Pre-Feasibility Study of PPPProject.

2) The calculation of HPS (owner’s estimate) shall cover investmentcost which is consisting of project cost, interest provision, interest

assumption, and escalation.3) Project cost as intended in number 2) is consisting of preparatory

cost, construction cost and supervisory cost, operation andmaintenance cost as well as land acquisition cost, if any.

4) Interest as intended in number 2) is consisting of interest duringconstruction period and interest on loan principal.

5) The calculation of HPS (owner’s estimate) shall consider any

matters affecting the business undertakings of PPP Project inaccordance with the sector characteristic.

6) The calculation of HPS (owner’s estimate) shall be done withassistance from the consultant.

7) The GCA shall determine the HPS (owner’s estimate) prepared bythe Procurement Committee.

g. The preparation of Public Tender Documents as intended in letter c

number 4) shall fulfill the following provisions:1) The Procurement Committee shall prepare the Public Tender

Documents.

2) The Public Tender Documents shall contain the general provisions,scope of work, bidding process, method of evaluation and othermatters deemed necessary by the Procurement Committee to beincluded and required in the Public Tender Documents.

h. The market sounding as intended in letter c number 5) shall fulfil thefollowing provisions:

1) The GCA shall explore the market sounding to obtain inputs and toknow the interest of prospective investors on the PPP Project to beoffered

4) Based on the results of the market sounding conducted by the GCA,the Procurement Committee may make alteration to the concept of



t e ocu e e t Co ttee ay a e a te at o to t e co cept othe Public Tender Documents.

i. Use of Consultant Services

1) The GCA may use consultant services assigned to provide inputsand suggestions to the GCA in conducting the Business EntityProcurement Planning as well as to accompany or represent theGCA in carrying out all activities related to Business EntityProcurement.

2) The Consultant appointed by the GCA is prohibited to provideconsultation services and/or accompany and/or provide informationto another party in respect of the PPP Project where the consultantis involved.

4. Implementation of Business Entity Procurement

a. Implementation of Business Entity Procurement covers the activities ofprequalification, implementation of bid, and preparation of the executionof the PPP Contract.

b. The GCA may continue to the prequalification process, in the event thefollowing matters have been fulfilled:

1) Documents of Pre-Feasibility Study;

2) In-principle approval of the Government Support and/or GovernmentGuarantee from the Minister and/or Head of Region and/or in-principle approval from the BUPI; and

3) The SKKL and environmental Permit from the Regional Governmentand Designation of Project Location from the Governor.

5. Prequalification as intended in number 4 letter a shall meet the followingprovisions:

a. Prequalification Announcement

1) The Procurement Committee shall widely announce the presence ofprequalification of the Business Entity.

2) The content of the announcement shall at least include:

a) name and address of the GCA that will conduct the procurementof Business Entity;

b) brief elucidation pertaining to the PPP Project that will be carried

having circulation in the location of the PPP Project to be carried out,and if possible, the announcement shall be made in the website of



p ,the related GCA.

4) For the PPP Project most likely attracts foreign investors, theannouncement may be carried out through a printed media havinginternational circulation.

b. Prequalification Implementation

1) The GCA shall continue to the process of prequalificationimplementation in the event all requirements as intended in number5 letter a have been fulfilled.

2) Procedures of Prequalification Implementation:

a) Prequalification announcement for the procurement of BusinessEntity shall be carried out in accordance with number 5 letter a.

b) The Procurement Committee shall, on the date theprequalification announcement is determined, register theprospective tender participants.

c) Prospective tender participants shall submit the Documents ofExpression of Interest as the requirement to take PrequalificationDocuments.

d) In accordance with the schedule determined, prospective tenderparticipants shall submit the Prequalification Documents to theProcurement Committee.

e) Evaluation and clarification of the Prequalification Documents

shall be carried out by the Procurement Committee.f) Determination of list of prospective tender participants who

passed the prequalification by the Procurement Committee.

g) Validation of prequalification result by the ProcurementCommittee.

h) Announcement of prequalification result by the ProcurementCommittee.

i) Prospective tender participants who passed the prequalificationare entitled to take the Public Tender Documents from theProcurement Committee by paying a certain amount inaccordance with the provisions of laws and regulations.

j) S b i i f t t / bj ti b ti t d

as of the submission of the protest/objection received by theGCA.



l) Re-Evaluation by the Procurement Committee within 7 (seven)working days after the protest / objection of the prospectivetender participant proved to be true.

m) Based on the results of re-evaluation, the ProcurementCommittee shall announce them to the prospective tenderparticipants under the provisions:

(1) If the prospective tender participants passing thePrequalification are less than 3 (three), the ProcurementCommittee shall process re-Prequalification.

(2) Prospective tender participants who have previously passedthe Prequalification need not follow the process of re-prequalification.

(3) The Procurement Committee shall announce the re-Prequalification by inviting new prospective tenderparticipants.

(4) In the event after re-Prequalification has been conducted,and there is no addition of new prospective tenderparticipants passing the Prequalification or all prospectivetender participants who have passed the Prequalification arestill less than 3 (three), the Procurement Committee shallcontinue to the process of procurement of Business Entity.

3) Procedures of Prequalification Evaluation

a) Prequalification covers the evaluation of completion of thefollowing documents:

(1) validity of the permits owned to be able to carry out itsbusiness activities;

(2) its deeds of establishment and article of association,including any amendments thereof;

(3) authority to sign the PPP Contract;

(4) structure of the board of directors and the board ofcommissioners;

(5) statement letter pertaining to the status of the prospectivetender participant declaring that the prospective tender

public and consularized by the Indonesian embassy orconsulate in the country where the said statement letter



was signed);

(6) experiences in the PPP Project of Provision of similarInfrastructure;

(7) ability to provide facilities and equipment as well aspersonnel;

(8) financial statement which has been audited by a publicaccountant office covering last 3 (three) financial years (ifthe prospective tender participant was established lessthan 1 (one) year, then the financial statement used is thefinancial statement of its holding company);

(9) letter of financial support from the bank;

(10) letter of support from shareholders (sponsorshipagreement); and

(11) the availability of special equipment, special expertsrequired, or certain experience for special/ specific/ high-technology work.

b) In the event the prospective tender participant is a consortium,the evaluation above shall cover each member of the consortiumand shall submit a consortium agreement that clearly showschairman of the said consortium. In the event the prospectivetender participant is a limited liability, completion of the abovedocuments also covers the shareholders thereof.

4) Implementation of Bid

a) Implementation of bid shall comprise of activities of Preparationof List of Participant, Submission of Invitation and taking ofPublic Tender Documents.

b) The Procurement Committee shall prepare the list of prospectivetender participants who passed in the Prequalification to belegalized by the GCA.

c) List of prospective tender participants who have passed thePrequalification shall be announced in the official board or theGCA’s website.

d) Prospective tender participants who passed the Prequalification

a) Elucidation of Procurement shall be carried out at the place andtime which have been determined, and in the presence of

ti t d ti i t



prospective tender participants.

b) The absence of prospective tender participants at the time ofelucidation of procurement cannot be used as the basis to refuseor abort the documents submitted.

c) The legal representative of the prospective tender participantmay empower another party in writing to attend the event ofElucidation of Procurement and shall be shown to theProcurement Committee when the Elucidation of Procurement is

carried out.

d) In the event of elucidation of procurement, the following shall beelucidated to the prospective tender participants:

(1) procurement method;

(2) procedures of submission of Bid Documents;

(3) documents to be attached in the Bid Documents;

(4) procedures of opening of the Bid Documents;(5) method of bid evaluation;

(6) matters that can abort the bid;

(7) concept of cooperation contract;

(8) provisions and method of bid evaluation in respect of pricepreference on the use of domestic production in accordancewith the prevailing laws and regulations; and

(9) the amount, period and the party that may issue the bidbond.

e) If deemed necessary, the Procurement Committee may providefurther elucidation by conducting field inspection.

f) Especially for the discussion of the concept of the PPP Contract,the Procurement Committee may held a meeting with eachprospective tender participant separately (competitive dialogue)to accommodate feedbacks or comments from each prospectivetender participant to the concept of the PPP Contract, includingthe maximum amount of viability support (viability gap funding).

g) Every feedback or comment from each prospective tender

h) Alteration on the concept of the PPP Contract shall be reportedby the Procurement Committee to the GCA to obtain itsapproval



approval.

i) The Procurement Committee shall submit the alteration of thePPP Contract concept to all prospective tender participants priorto the deadline of the Bid Document submission and shallconstitute the final concept to be executed by the BusinessEntity which wins the tender, including the maximum amount ofthe feasibility support that may be used as the procurementparameter.

j) Provision of information to questions from the prospective tenderparticipants pertaining to the Public Tender Documents andanswers from the Procurement Committee as well as otherinformation including any alteration of the Public TenderDocuments and field inspection, shall be specified in the BAPsigned by the Procurement Committee and by minimally 1 (one)representative of the tender participants who are present, andforming one unit inseparable of the Public Tender Documents.

k) If in the said BAP (minutes of pre-bid meetings) there arematters or new provisions or significant alteration that needs tobe accommodated, the Procurement Committee shall includethem into the alteration of the Public Tender Documents.

6) Submission of Bid Documents

a) Method of submission of the bid Documents shall be specified inthe Public Tender Documents.

b) Method of submission of the Bid Documents shall use the 2(two)-envelope method, namely envelope I containingadministrative and technical documents, and envelope IIcontaining financial documents, then the said two envelopesshall be incorporated into 1 (one) closed envelope and submittedat the same time to the Procurement Committee.

c) The Bid Documents shall be submitted in accordance with theplace, date and time as specified in the Public TenderDocuments.

d) The Bid Documents shall be submitted directly by theprospective tender participant to the Procurement Committee atthe place, date and time which have been determined in the

f) On the deadline of the submission of the Bid Documents, theProcurement Committee shall open a meeting of opening the BidDocuments declare before the prospective tender participants



Documents, declare before the prospective tender participantsthat the time for submitting the Bid Documents has been closedin accordance with the date and time already determined.

g) The Procurement Committee shall reject the Bid Documentssubmitted in excess to the deadline of the submission of the BidDocuments or addition of the Bid Documents.

h) The tender participant may not withdraw if it has submitted theBid Documents and the said Bid Documents have been received

by the Procurement Committee.

7) Opening Bid Documents

a) The method of opening Bid Documents shall be specified in thePublic Tender Documents.

b) The Procurement Committee shall request the willingness of atleast 1 (one) representative of each of at least 2 (two) tenderparticipants who attend to act as witnesses.

c) If there is no representative of tender participant or there is only1 (one) representative of tender participant as a witness, theProcurement Committee shall then request the approval of thetender participants who attend to postpone the opening of theBid Documents.

d) If the tender participants who are present do not agree topostpone the opening of the Bid Documents, then the opening of

the Bid Documents shall be continued by appointing one extrawitness other than the Procurement Committee in writing by theProcurement Committee.

e) If the tender participants who are present agree to postpone theopening of the Bid Documents, then the Procurement Committeeshall postpone it for 2 (two) hours.

f) If after being postponed for 2 (two) hours there is only 1 (one)tender participant appears or there is no representative of other

participants as the witness, the opening of the Bid Documentsshall be continued by appointing an extra witness other than theProcurement Committee in writing by the ProcurementCommittee.

(1) Letter of bid specifying the period of bid but does not specifythe bid price;



(2) The original bid bond having the same period with the periodin the letter of bid; and

(3) Technical Bid Documents and other supporting documentsrequired by the Public Tender Documents.

i) The Procurement Committee may abort the Bid Documents atthe opening of bid, if the submission and completion of the BidDocuments are not in accordance with the ProcurementDocuments.

j) The Bid Documents shall then be initialized by the ProcurementCommittee and 2 (two) representatives of the tenderparticipants.

k) The Procurement Committee shall immediately prepare theBAPP (minutes of bid opening) to all Bid Documents submitted.

l) After being read clearly, the BAPP shall be signed by theProcurement Committee and 2 (two) representatives of thetender participants appointed by the tender participants who arepresent.

m) In the event there is no tender participant appearing until thedeadline determined, then the BAPP shall be signed by theProcurement Committee and witnessed by 2 (two) persons otherthan the Procurement Committee appointed in writing by theProcurement Committee.

n) In the event there is only 1 (one) bid, the BAPP shall be signedby the Procurement Committee, representative of the tenderparticipant, and 2 (two) witnesses other than the ProcurementCommittee and the tender participant appointed in writing by theProcurement Committee.

o) Copy of the BAPP shall be submitted to the representative of theappearing tender participants without being enclosed with theBid Documents.

p) The Procurement Committee is not allowed to receive anyalteration or addition whatsoever to the Bid Documentssubmitted by the tender participants after the deadline ofsubmission of the bid Documents.

b) The method of bid evaluation used is adjusted to the type ofinfrastructure to be cooperated.



9) Making Minutes of Procurement Resultsa) The Procurement Committee shall conclude the evaluation

results specified in the BAHP (minutes of results of the tender).

b) The BAHP shall contain results of the implementation ofprocurement, including method of evaluation, formulas used, upto the decision of winner sequence in the form of list of tenderparticipants.

c) The BAHP shall be signed by the chairman and all members ofthe Procurement Committee or at least two third of the totalmembers of the Procurement Committee.

d) The BAHP is confidential until the time of signing of the PPPContract.

e) The BAHP shall contain the following:

(1) names of all tender participants and bid price and/ or

corrected bid price of each bid participants;(2) method of evaluation used;

(3) formulas used;

(4) other information deemed necessary pertaining to thecircumstances of implementation of procurement;

(5) date of making the minutes and number of tenderparticipants who passed and did not pass in each evaluation

stage;

(6) decision of sequence of 1 (one) prospective winner and 2(two) reserves;

(7) statement that the procurement is declared to fail and re-procurement shall be conducted if there is not any bideligible;

(8) decision of sequence of 1 (one) prospective winner and 1(one) reserve, if there are only 2 (two) bidders are eligible forthe requirements; and

(9) the statement that the procurement declared to fail and re-procurement shall be made, or the said bidder is determined

b) The Procurement Committee shall make and submit the reportto the GCA in order to determine the Business Entity who winsthe tender.



c) The report as intended in letter b shall be accompanied by theproposal of prospective tender winner as well as stand-byprospective tender winner and elucidation or other informationdeemed necessary as material of consideration to makedecision.

d) The GCA shall declare the Business Entity winning the tenderbased on the proposal of the Procurement Committee.

e) In the event the GCA has different opinion from the proposal ofthe Procurement Committee, then the GCA shall discuss thesaid matter with the Procurement Committee in order to makedecision and shall be included in the minutes containing theobjection and agreement to be signed by the GCA and theProcurement Committee (decision takes the form of agreeing theproposal of the Procurement Committee or conducting re-evaluation which results shall be final).

f) The supporting data needed to declare the Business Entitywinning the tender are:

(1) Public Tender Documents, including the alteration (if any);

(2) BAPP;

(3) BAHP;

(4) Summary of process of procurement and results of

procurement; and

(5) Bid Documents from prospective tender winner and reserveof tender winner.

g) In the event of delay in declaring the tender winner and causethe bid/ bid guarantee expired, confirmation to all tenderparticipants shall be made in order to extend the bid letter andbid bond.

h) In the event the prospective winner refuses to extend the validityof the bid letter and bid bond, it may withdraw without beingimposed with any sanction.

6. Declaration of Single Bidder

b. The Procurement Committee shall make and submit a report to theMinister/ Head of Institution/ Head of Region pertaining to the singlebidder.



c. The Minister/ Head of Institution/ Head of Region shall order theProcurement Committee to negotiate with the single bidder.

d. The Procurement Committee shall implement negotiation with the singlebidder by referring to the Tender Documents and the HPS (owner’sestimate).

e. If the negotiation with the single bidder causes the bid/ bid bond expired,then the single bidder shall immediately extend the bid letter and bidbond prior to the expiration thereof.

f. The Procurement Committee shall make and submit the BAHN andother information to the Minister/ Head of Institution/ Head of Region.

g. The Minister/ Head of Institution/ Head of Region may reject or agreewith the results of the negotiation based on reasonable and accountablegrounds.

h. In the event the Minister/ Head of Institution/ Head of Region refuses theresults of the negotiation, then the procurement process shall berepeated.

i. In the event the Minister/ Head of Institution/ Head of Region agrees withthe results of the negotiation, the Procurement Committee maydetermine the single bidder as the winner.

j. The supporting data needed to determine the negotiation are:

1) Documents of the Public Tender, including the alteration thereof (ifany);

2) BAPP;

3) BAHP; and

4) Summary of the tender process and tender results.

7. Announcement of a tender winner or a single bidder of tender winner or asingle bidder.

a. Announcement of a tender winner or a single bidder of tender winner ora single bidder shall be made and notified by the ProcurementCommittee to all tender Participants at the latest 2 (two) working daysupon receipt of the decision of tender winner or single bidder from theMi i t / H d f I tit ti / H d f R i

8. Challenge by Tender Participant

a. Tender participants who object to the determination of tender winner or



single winner are given the opportunity to challenge in writing, at thelatest 7 (seven) working days since the date of announcement of theBusiness Entity tender winner.

b. The challenge shall be delivered to the GCA, attached with evidences ofthe deviation.

c. The challenge shall be delivered by the tender participant individually ortogether with other tender participants.

d. The reliability of the subject matter of the challenge shall be investigatedby the GCA based on the evidences submitted by tender participant andother supporting evidences.

e. The GCA shall announce the results of investigation on the challengesubmitted and shall take reasonable action in relation to the results ofinvestigations at the latest within 9 (nine) working days after theexpiration of the challenge period.

9. Issuance of Letter of Declaration of Winner

a. The GCA shall issue a Letter of Declaration of Business Entity TenderWinner as the party implementing the PPP Project under the provisions:

1) there is no more challenge from tender participants; or

2) the reliability of the subject matter of the challenge received by theGCA in the challenge period turns out to be not obviously true , orthe challenge has surpassed the challenge period.

b. The tender participant who has been declared as a winner shall receivethe said decision.

c. In the event the tender participant withdraws and the bid period thereofis still valid, then the said withdrawal may only be conducted based onthe grounds objectively acceptable by the GCA.

d. The GCA shall have the rights to disburse the bid bond of thewithdrawing tender participant and it shall be deposited to the state’streasury as the Non-Tax State’s Revenue or in the event the GCA is aHead of Region, it shall be deposited to the regional treasury as theregional revenue.

e. A tender participant who has been decided as a winner but haswithdrawn under unacceptable grounds and the bid period thereof is still

f. In the event the tender participant as intended in letter e is a consortium,then all members of the said consortium either severally or jointly aresubject to a sanction in the form of prohibition to follow activities of the



procurement of Business Entity for the PPP Project for 2 (two)consecutive years.

g. In the event a tender participant who has been declared as the firstranked tender winner withdraws, then the second ranked prospectivetender winner is declared as the preferred bidder provided that:

1) The said declaration of tender winner shall first obtain the GCA’sapproval.

2) The validity of the bid letter of the second ranked prospective tenderwinner is still effective or the period thereof has been extended.

h. In the event the second ranked prospective tender winner is alsowithdrawn, then the declaration of the winner can be awarded to the thirdranked of prospective tender winner (if any) provided that:

1) The said declaration of tender winner shall first obtain the GCA’sapproval.

2) The validity of the bid letter of the third ranked of prospective tenderwinner is still effective or the period thereof has been extended.

3) The GCA shall have the right to disburse the bid bond of the secondranked prospective tender winner and it shall be deposited to thestate’s treasury as the Non-Tax State’s Revenue or in the event theGCA is a Head of Region, it shall be deposited to the regionaltreasury as the regional revenue.

4) If the second ranked prospective winner withdraws under reasonsobjectively unacceptable by the GCA, then it will be subject to asanction in the form of prohibition to follow activities of theprocurement of Business Entity for the PPP Project for 2 (two)consecutive years.

5) In the event the third ranked prospective winner withdraws underreasons objectively unacceptable by the GCA, then it will be subjectto a sanction in the form of prohibition to follow activities of the

procurement of Business Entity for 2 (two) consecutive years andthe GCA is entitled to disburse the bid bond of the third-sequenceprospective tender winner and it shall be deposited to the state’streasury as the Non-Tax State’s Revenue or in the event the GCA isa Head of Region then it shall be deposited to the regional treasury

tender winner and shall be immediately submitted to the tenderwinner.

8) O f th i f th L tt f D l ti f T d Wi h ll



8) One of the copies of the Letter of Declaration of Tender Winner shallbe submitted (without attaching the PPP Contract) at least to theworking unit that shall monitor the implementation of the PPPContract.

10. Issuance of Letter of Declaration of Single Winner

a. The GCA shall issue a Letter of Declaration of Single Winner ofBusiness Entity Procurement as the party carrying out the PPP Projectbased on the BAHN (minutes of result of negotiation) provided that:

1) there is no challenge from tender participants; and

2) the validity of the challenge received by the GCA in the challengeperiod turned out to be not verifiable, or the challenge received hassurpassed the challenge period.

b. This Letter of Declaration shall not be applicable in the event thesingle bidder is the only participant who is passed the Prequalification.

c. The single winner determined as the party carrying out the PPP Projectshall accept the said decision.

d. In the event the single winner withdraws and the bid period thereof is stillvalid, then the said withdrawal may only be carry out based on thegrounds objectively acceptable by the GCA.

e. The GCA shall have the right to disburse the single winner’s bid bondand it shall be deposited to the state’s treasury as the Non-Tax State’sRevenue or in the event the GCA is a Head of Region, it shall bedeposited to the regional treasury as the regional revenue.

f. A single winner who withdraws under unacceptable grounds and the bidperiod thereof is still valid, beside the respected bid bond shall bedisbursed and become the Non-Tax State’s Revenue or deposited to theregional treasury, the said single winner is subject to a sanction in theform of prohibition to follow activities of the procurement of BusinessEntity for the PPP Project for 2 (two) consecutive years.

g. In the event the single winner is a consortium, then all members of thesaid consortium either severally or jointly are subject to a sanction in theform of prohibition to follow activities of the procurement of BusinessEntity for the PPP Project for 2 (two) consecutive years.

j. One of the copies of the Letter of Declaration of a single bidder shall besubmitted (without enclosure of the PPP Contract) at least to the workingunit that will monitor the implementation of the PPP Contract.



11. Preparation for the Signing of PPP Contract

a. Process for the establishment of a Special Purpose Company (SPC)/Business-Entity

1) The tender winner shall establish a Business Entity (a specialpurpose company/SPC) that shall sign the PPP Contract.

2) The Business Entity/SPC shall be legally established at the latest 6

(six) months since the issuance of the Letter of Declaration ofTender Winner or Letter of Declaration of Single Winner by the GCA.

b. Process of Signing the PPP Contract

1) The PPP Contract shall be signed by the GCA and Business Entity(the SPC).

2) The PPP Contract shall become effective after all conditionsprecedent in the PPP Contract have been obtained by all parties.

3) The conditions precedent as intended are among others theissuance of approval of Government Guarantee and the obtaining ofall necessary permits by the Business Entity/SPC to carry out its lineof business.

4) The financial close shall not constitute conditions precedent in orderthat the PPP Contract becomes effective.

5) In the event all conditions precedent have been fulfilled, the GCA

shall issue minutes pertaining to the effectiveness of the PPPContract.

D. Decision-Making of the proposed PPP Project to proceed to theProcurement Process

1. In the event the PPP Project has met the criteria of a ready-to-offer project,the GCA may proceed to the process of procurement of business entity.

2. In the event the PPP Project does not meet the criteria of a ready-to-offerproject, the GCA shall complete all necessary requirements so that it maycontinue to the process of procurement of business entity.

3. Criteria of a ready-to-offer project as intended are to complete the following

d. Designation of Project Location from the Governor.

E Supporting Activi ties During the Transaction Phase



E. Supporting Activi ties During the Transaction Phase

1. Activities Related to Environment:

a. To finalize the Pre-Feasibility Study, the GCA shall complete all thepreparation of the AMDAL Documents or fill the UKL-UPL forms.

b. To submit the AMDAL documents which have been completed to theMinister, Governor, or Head of Region in accordance with its authoritythrough the Secretariat of the Amdal Evaluation Commission in theCentral, provincial or regency/city level in accordance with its authoritybased on the prevailing laws and regulations.

c. To submit the UKL-UPL forms already filled to the Minister, Governor, orHead of Region in accordance with its authority to be further used as thebasis for the issuance of the UKL-UPL recommendation.

d. To ensure that the SKKL or the UKL-UPL recommendation has beenobtained from the Minister, Governor or Head of Region in accordance

with its authority based on the laws and regulations.

e. To determine the requirements that shall be carried out by the BusinessEntity as those specified in the SKKL or UKL-UPL recommendation andEnvironmental Permit.

2. Activities With Regard To Land Acquisition and Resettlement

a. The GCA shall submit application of issuance of determination oflocation to the Governor based on the laws and regulations.

b. The GCA shall use the information in the RKL and RPL in order tocomplete the program of land acquisition and resettlement.

c. The GCA shall ensure the availibility of budget to carry out the landacquisition.

d. At the time the process of Business Entity Procurement is started, theGCA shall ensure that the process of land acquisition has started to becarried out by the institution which undertakes affairs in the land sector in

accordance with the laws and regulations.

e. At the time the process of Business Entity Procurement is started, theGCA shall ensure that the resettlement program has been carried out.

f At the end of the process of Business Entity Procurement the GCA shall

1) At the time the Pre-Feasibility Study is completed, the GCA shallsubmit Documents of the Pre-Feasibility Study to the Minister ofFinance to obtain the in-principle approval of the Government

Support in the form of non-financial fiscal contribution;



Support in the form of non-financial fiscal contribution;

2) At the time of the Prequalification implementation, the GCA shall filethe request of granting the initial determination of feasibility supportin accordance with the laws and regulations;

3) At the time of the bid implementation, the Minister of Finance shallissue an initial decision letter of viability support (viability gapfunding) in accordance with the laws and regulations;

4) At the time of determination of a tender winner, the GCA shall submitresults of determination of the winner to the Minister of Finance asthe basis for Minister of Finance to issue the final decision letter ofviability support (viability gap funding).

b. Government Guarantee

1) By enclosing the Report of Pre-Feasibility Study, the GCA shallsubmit the guarantee application package to obtain the Government

Guarantee to the BUPI and the BUPI shall issue a Letter of Intent forthe project eligible for the BUPI’s requirements.

2) After the Guarantee Application Package received by the BUPI,BUPI shall conduct an evaluation on the guarantee applicationpackage according to the provisions of the prevailing laws andregulations.

3) The BUPI and GCA shall finalize the Guarantee Contract and theRegress Contract shall be done at the finalization of the PPPContract, at the same time finalization of the loan agreement with thebusiness entity.

4) Before the tender participants submit the Bid Documents, the GCAshall ensure that the BUPI has issued in-principle approval.

5) In-principle approval as intended in point 4) is issued in the form ofLetter of Intent based on the results of BUPI’s evaluation.

F. Documents Generated in the Transaction Phase

1. Documents generated in the Transaction Phase of PPP Project Cyclecomprises of:

2. The PPP Contract Document as intended in number 1 letter a shall at

least cover:

a scope of work that shall be carried out by Business Entity or outputs



a. scope of work that shall be carried out by Business Entity or outputsthat shall be completed by the Business Entity;

b. period of the PPP Contract including possibility of the extensionthereof;

c. performance bond;

d. prevailing tariff and period as well as the mechanism of tariffadjustment;

e. rights and obligations of the parties in the PPP Contract includingallocation of risk sharing;

f. standard of minimum service performance that shall be provided bythe Business Entity and the adjustment mechanism thereof;

g. transfer of shares before the PPP Project operating commercially(transfer of shares may only be carried out after granting an approvaland based on the criteria determined by the GCA with the provisions

that the said transfer of shares does not delay the schedule ofstarting the operation of the PPP Project. It is necessary to considerthat the new shareholder in the Business Entity shall meet the sameprequalification requirements of the previous Business Entity orshareholders when the procurement of Business Entity isimplemented);

h. sanction in the event the parties fail to meet the provisions in thePPP Contract;

i. termination (including accelerated termination) of PPP Contract;

j. financial statement of the Business Entity in order of theimplementation the PPP Contract, audited annually by a publicaccountant office and shall be announced at least in 1 (one) printedmedia having national circulation;

k. mechanism of dispute settlement regulated in stages, namely mutualagreement, mediation and arbitrary/ court;

l. mechanism of monitoring the Business Entity’s performance inimplementing the PPP Project by the Management Unit of the PPPContract implementation;

o. force majeure in the form of any matters that may be deemed asforce majeure and the provisions to make improvement due to theforce majeure;

p representations and warranties of the parties that the PPP Contract



p. representations and warranties of the parties that the PPP Contractlegally binds the parties and is in accordance with the laws andregulations;

q. the PPP Contract may be made in Indonesian and English inaccordance with the laws and regulations; and

r. the prevailing law shall be Indonesian laws.

3. The Pre-Feasibility Study Document as intended in number 1 letter bcovers:

a. Executive Summary;

b. Introduction, covering:

1) Background of the Project; and

2) Objectives/ Target.

c. Needs Analysis, covering:

1) Strategic Objectives and Target;

2) Institutional Arrangement;

3) Scope of PPP Project;

4) Output Specifications; and

5) Conclusions.

d. Definition of PPP Project;e. Market Study;

f. Technical Profile, covering:

1) Site Preparation;

2) Social Safeguards;

3) Environmental Safeguards; and

4) Conclusions.

g. Evaluation of Project Feasibility, covering:

1) Economy Analysis:

2) Financial Analysis:

a) Assumptions; and



) ssumptions; and

b) Evaluation Results.

3) Conclusions.

h. Options Analysis, covering:

1) Considered options;

2) Evaluation of Technical Options;

3) Recommended Technical Options;

4) Study of Cooperation Form; and

5) Need of Government Support and/or Government Guarantee.

i. Conclusions and Recommendations;

j. Enclosures, comprising of:

1) Legal Analysis;

2) Institutional Analysis;


4) Site Enablement Analysis;

5) Market Analysis;

6) Economic and Financial Analysis;

7) Risk Analysis;

8) Public Consultation: Opinion of stakeholders;

9) Social Analysis;

10) Environmental Analysis;

11) Statement of in-principle approval of the Government Supportfrom the Minister/ Head of Institution/ Head of Region (ifnecessary);

12) Statement of application to obtain the Government Guaranteefrom the BUPI;

b. general provisions of procurement that shall at least contain:

1) scope of work, number of Bid Documents submitted, and

inspection of the PPP Project’s site;2) t t f P bli T d D t l id ti f P bli



p j2) contents of Public Tender Documents, elucidation of Public

Tender Documents, and alteration of contents of Public TenderDocuments; and

3) requirements of language used in the Bid Documents, writing ofthe bid price, currency of bid and terms of payment, term of bid,bid bond letter, proposal of alternative bid by tender participant,form of bid, and signing of bid letter (for tender participant of

foreign legal entity, the Bid Documents shall be prepared inaccordance with the language required in the Public TenderDocuments, while the supporting documents of the BidDocuments may use the official language of the said foreignlegal entity, under the provisions that the ProcurementCommittee may request official confirmation on the saidsupporting document).

c. method of submission and signing of the Bid Document envelope,

deadline of the submission of the Bid Documents, treatment for lateBid Documents, and prohibition for alteration and withdrawal of theBid Documents already submitted;

d. procedures of opening the Bid Documents, clarifications of the BidDocuments, examination of the Bid Documents completion,arithmetic correction, and conversion into single currency;

e. evaluation system of the Bid Documents covering the criteria,

formulation and procedures of evaluation;f. documents of Pre-Feasibility Study of the PPP Project;

g. PPP Contract already finalized by the Procurement Committeebased on the term sheet of the PPP Contract which has beenprepared in the Pre-Feasibility Study Preparation stage;

h. technical specification and drawing;

i. form of bid letter;

j. plan of cooperation form based on the results of study on the PPPProject;

k. plan of project funding and the fund resources thereof;

Indonesia as well as the amount of performance bond in the form ofpercentage of the PPP Project’s value (the amount of performancebond may be reduced gradually according to the progress of the

PPP Project as regulated in the PPP Contract);



n. confidentiality agreement executed by the tender participant, statingthat the contents of the Bid Documents cannot be used by the tenderparticipant for the purpose other than participating in the PPP Projectand may not be widely spread to another party without a prior writtenapproval from the Procurement Committee;

o. statement of confidentiality issued by the Procurement Committee,

declaring that the contents of the Bid Documents may not be widelyspread to another party without a prior written approval from thetender participant, including the personnel who can have access onthe Bid Documents; and

p. Method of submission of the Bid Documents.

5. The Guarantee Agreement as intended in number 1 letter d, shall meetthe following provisions:

a. The Guarantee Agreement shall be made and carried out based onthe laws and regulations in the infrastructure guarantee in the PPPproject between the Government and Business Entity (the SPV).

b. These documents shall contain a written agreement containing therights and obligations between the BUPI and the GuaranteeRecipient in the framework of Infrastructure Guarantee that shall atleast cover:

1) risk share between both parties in accordance with risk

allocation;

2) relevant mitigation effort from both parties to prevent theoccurrence of risks and to reduce the impacts thereof if it occurs;

3) total financial obligation of the GCA in the event infrastructurerisk that is the GCA’s liability take places, or procedures todetermine the amount of financial obligations of the GCA in theevent the said amount has not been able to be determined when

the PPP Contract is signed;4) sufficient period to carry out the GCA’s Financial Obligations

including the grace period;

5) reasonable procedures to determine when the GCA has been in

7) the laws applicable shall be Indonesian laws.

6. The Regress Agreement as intended in number 1 letter e shall meet thefollowing provisions:

a These documents contain a written agreement between the BUPI



a. These documents contain a written agreement between the BUPIand the GCA containing the provisions and fulfilment of regress.

b. Regress is the right of the BUPI to bill the GCA for what it has paidto the Guarantee Recipient in order to fulfil the GCA’s FinancialObligations by calculating the value of time of the said money paid.(time value of money).

c. The provisions of the Regress Agreement shall at least regulate:

1) terms and conditions pertaining to the settlement of regresscontaining at least the period of settlement and payment terms;

2) procedures of the dispute settlement that may arise between theBUPI and the GCA in respect of the implementation of theRegress Contract pertaining to the settlement alternative ofdispute and/or arbitrary institution.

CHAPTER V

THE PPP CONTRACT MANAGEMENT PHASE




1. After the PPP Contract was signed, the GCA shall continue to the phase ofimplementing the PPP Contract Management.

2. The PPP Contract Management as intended in number 1 shall be carried out

with the purpose to ensure that the provision of services as well as theimplementation of respective rights and obligations of the GCA and theBusiness Entity (the SPV) have been fulfilled in accordance with theagreement in the PPP Contract.

3. Management of the PPP Contract Implementation as intended in number 1shall be carried out in 4 (four) period, namely:

a. Pre-construction;

b. Construction;c. Commercial Operation; and

d. Termination of the PPP Contract.

4. During the implementation of the PPP Contract Management, the GCA shallensure that the implementation of the Guarantee Agreement and Regress Agreement shall not deviate from the provisions previously agreed.

5. In order of supervision and control the course of PPP Contract in accordance

with the provisions already agreed and specified in the PPP Contract, theGCA shall form a Management Unit.

B. Planning for the Implementation of PPP Contract Management

1. The Management Unit as intended in letter A number 5 may be formedas a working unit/ new working unit or use any existing working unit in theGovernment/ Regional Government.

2. The Management Unit as intended in number 1 shall be formed with thepurpose to prepare and draw up the plan as well as to carry out theImplementation of the PPP Contract Management and to be responsible forperiodically reporting to the GCA in respect of the results of Implementation

2) Business Entities;

3) Professional Associations ;

4) Academics; and5) Users



5) Users.

b. In the initial period of implementation the PPP Contract, one of themembers shall constitute a member of the Procurement Committee ofthe PPP Project.

c. members deriving from an Professional Associations shall at leastconstitute a Technical Expert and an Audit Expert.

4. Work Period of Management Unit

a. the work period of Management Unit shall last until the expiration ofthe PPP Contract.

b. the work period of members of Management Unit shall bedetermined by the GCA and membership of the Management Unit shallbe evaluated by the GCA at every end of the work period.

5. In conducting the planning for the implementation of the PPP ProjectManagement, the Management Unit shall consider the following:

a. partnership approach, namely the Management Unit, in conductingthe Implementation Management of the PPP Contract shall beindependent and objective;

b. monitoring system of provision of services to be carried out by theBusiness Entity;

c. requirements of administrative documents to be fulfilled by the GCAand the Business Entity that shall be regulated in the PPP Contract;

d. main tasks of the Management of the PPP Contract to be based onmatters that shall be monitored during the implementation of the PPPContract; and

e. role and responsibilities of the GCA and Business Entity.

6. Implementation Plan of the PPP Contract Management shall cover theactivity of:

a. preparation of the work plan based on the mechanism of supervisionof the Business Entity’s performance in the implementation of the PPPProject contained in the PPP Contract;

2) compliance time of obligations or the said action as well as theresults or target to be achieved;

3) role and responsibility in the implementation management aswell as the provision of information;



4) time of commencement of activities of the ImplementationManagement of the PPP Contract and other important dates;

5) funding of all activities of the Management of the PPP Contract;

6) reporting pertaining to results of implementation management;

7) date of commencement of implementation of the PPP Contract

and provision of service in certain sectors;8) mechanism of comparison and testing if necessary;

9) framework for independent auditor; and

10) default and sanction.

c. preparation of training and capacity building for members of theManagement Unit; and

d. in the contex oft capacity building, the Management Unit may useconsultant services to provide guidance if necessary.

C. Activ ities Performed during the implementation of the PPP ContractManagement

1. Pre-construction Period

a. Implementing the contract management at the time of pre-constructionshall commence from the time of signing of the PPP Contract until thefinancial close.

b. The Management Unit is in charge of:

1) carrying out the implementation management of the compliance ofcondition precedent by the Business Entity in the PPP Contract andthe financial close; and

2) coordinating with the work unit in the Ministry of Finance in charge offiscal policy for the implementation of provision of the viabilitysupport (viability gap funding) and the BUPI in the implementation ofguarantee in accordance with the prevailing laws and regulations.

1) design of new facilities or elucidation on the services provided;

2) merging of new facilities with the existing ones;

3) site access and rights to submit problems related to the default andincapability of the Business Entity to meet the PPP Contract;



4) delay or change of construction schedule;

5) variation of construction design, if requested by the GCA;

6) readiness of work/ operation;

7) monitoring over the compatibility of technical planning andconstruction execution;

8) problems pertaining to labour; and

9) risks borne by the GCA.

c. In the event the implementation of the release of viability support andguarantee in the construction period, the Management Unit shallcoordinate with the working unit in the Ministry of Finance in the fiscalpolicy sector and the BUPI.

d. If transfer of shares of the Business Entity takes place prior to thecommercial operation of the Business Entity, the Management Unit shallcarry out activities covering:

1) determination of criteria of transfer of shares by the GCA thatincludes:

a) transfer of shares may not delay the starting schedule ofoperation of the PPP Project; and

b) the controlling shareholder that constitutes the chairman ofconsortium is prohibited to transfer its shares until thecommercial operation of the PPP Project is started;

2) conducting qualification to new prospective shareholders ofBusiness Entity that shall at least meet the requirements determinedwhen prequalification of public tender of the Business Entity iscarried out;

3) submitting an approval to the GCA, if the prospective newshareholder has met all criteria of transfer of shares determined andmet the qualification requirements; and

4) preparing the approval concept of transfer of shares that shall besigned by the GCA

1) the PPP Contract management; and

2) monitoring of service performance standard to be in accordance withthe PPP Contract.

c. In the event the monitoring of implementation of provision of guarantee



is in the period of operation, the Management Unit shall coordinate withthe BUPI.

4. Termination of the PPP Contract.

a. approaching of the termination of the PPP Contract, the ManagementUnit shall consider the following:

1) re-transfer of assets to the GCA (if the form of the PPP Project usesthe transfer option);

2) the PPP Contract shall specifically regulate the project conditiondesired when the PPP Contract expired and the PPP Project istransferred to the GCA; and

3) each sector/ sub sector shall have different characteristics so thatconsideration would be necessary on the situation in which theinfrastructure is physically and economically no longer feasible thatrehabilitation or renovation is required.

b. The Management Unit shall evaluate the assets that includes the activityof:

1) examining and evaluating all components of means/ system includedin the PPP Contract (Evaluation shall be made on the condition orperformance and remaining of life of each component in accordancewith benchmarks agreed);

2) calculating the estimate of costs needed for the operation as well asroutine and non-routine maintenance during the remaining of life;

3) evaluating the availability of spare parts for means and system thatmight be technically improper;

4) evaluating the availability of human resources owned the GCA; and

5) evaluating the efficiency of performance management during thecourse of the cooperation.

c. The GCA shall prepare and form an Asset Transfer Team in accordancewith the scheme applicable in each infrastructure sector.

d. The Asset Transfer Team may be prepared and formed when the

3) performing necessary administrative action according to the lawsand regulations so that all assets are registered in the name of theGCA; and

4) preparing and making Minutes of Transfer of Assets signed by theBusiness Entity and the GCA.



Business Entity and the GCA.

D. Other Activ ities During the PPP Contract Management Phase

1. Activities In Relation To Environment

a. In the pre-construction stage, the Management Unit shall use

information in the RKL-RPL or UKL-UPL for the Detail EngineeringDesign and technical specifications of updating the RKL-RPL orUKL-UPL.

b. In the construction stage, the Management Unit shall monitor theuse of the RKL-RPL or UKL-UPL in the engineering procurementconstruction contract.

c. In the commercial operation stage, the Management Unit shallmonitor the use of the RKL-RPL or UKL-UPL in the operation andmaintenance contract.

2. Activities In Relation To Government Support and/or GovernmentGuarantee

During the term of the PPP Contract, the Management Unit shall monitorand evaluate:

a. the implementation of provision of the viability support (viability gapfunding) by the Ministry of Finance and implementation of theGuarantee Agreement by the BUPI; and

b. the Regress Agreement between the GCA and the BUPI.

E. Documents Generated During the Contract Management Phase

1. The documents that shall be submitted by the Business Entity to the GCA inthe pre-construction period are:

a. detailed plan if implementation of the PPP Project includes the DetailEngineering Design;

b. all copies of contracts signed by the Business Entity with the third partycovering the engineering procurement construction contract or operation

2. Documents that shall be submitted by the Business Entity to the GCA in theconstruction period are:

a. administration report;

b. report of work progress (monthly report and annual report and/or specialreport);



report);

c. performance report (monthly report and annual report and/or specialreport); and

d. annual financial statement.

3. Documents that shall be submitted by the Business Entity to the GCA in the

operation period are:a. administration report;

b. performance report (monthly report and annual report and/or specialreport); and

c. annual financial statement.

4. Documents that shall be submitted by the Business Entity to the GCA whenthe PPP Contract expires are:

a. latest financial statement;

b. report of asset evaluation;

c. minutes of examination of assets; and

d. minutes of transfer of assets.

CHAPTER VI

THE PROCEDURES TO MANAGE

UNSOLICITED PPP PROJECT PROPOSALS




1. A Business Entity may submit Initiative of PPP Project by submitting aproposal to the Government based on the Procedures to Manage theUnsolicited PPP Project Proposals to be further evaluated by theGovernment prior to being determined as an Unsolicited PPP Project.

2. The Procedures to manage unsolicited PPP project proposals are intendedto:

a. ensure the transparency and competition in the execution of publictender of the Business Entity in order to carry out a PPP Project basedon an PPP Contract/Concession;

b. enhance the accountability and good governance of the GCA in carryingout Unsolicited PPP Projects; and

c. ensure the readiness of the Business Entity in preparing an unsolicitedPPP project proposal by providing guidelines pertaining to:

1) where to submit the proposal of the PPP Project;

2) what information and documents are required; and

3) the steps and timeframe for decisions to be made in order to obtainan approval on the proposal of the PPP Project initiated by theBusiness Entity.

3. The management process for Unsolicited PPP Project proposals shall becarried out in 2 (two) stages, namely:

a. The first stage is the approval process of Unsolicited PPP ProjectProposals and takes place from the time the Prospective Proponentpresents the project to the government until all internal assessments andapprovals are finished and the project is ready to be publicly tendered;

b. The second stage involves a competitive public tender process;approaches tend to differ in incentives or benefits to the originalProspective Initiator of the project.

Project Concept Document and the Qualification of the ProspectiveProponent Document.

b. The GCA shall evaluate the quality of the Project Concept Doment

under the criteria:

1) not included in the master plan in the related sector;



1) not included in the master plan in the related sector;

2) technically integrated with the master plan in the related sector;

3) compatibility with the national/ regional mid-term developmentplan;

4) compatibility of the project location with the Regional Spatial

Plan; and5) connectivity of cross-infrastructure sector and inter-region.

c. The GCA shall evaluate the qualification of a Prospective Proponentby appraising the capability and track records of the ProspectiveProponent in the preparation, transaction, development andoperation of PPP Projects;

d. The GCA shall make decision:

1) In the event it shall grant an approval to the Project Concept, theGCA provides an Approval Letter containing:

a) the exclusive rights of the Prospective Proponent during acertain period for the development of the PPP Project; and

b) obligations to fully deliver the Pre-Feasibility StudyDocument and to comply with the procedures of managingthe Unsolicited PPP Project, including to be consistent with

the General Guidelines.2) In the event the GCA rejects the Project Concept, it shall provide

a Notification Letter to the Prospective Proponent rejecting theproposal of the Unsolicited PPP Project.

2. The process to obtain an approval from the GCA for a ProspectiveProponent to continue the completion of the Feasibility Study of the PPPProject and the fulfilment of the Business Entity qualificationrequirements to participate in a public tender, includes 3 (three)activities:

a. The Prospective Proponent shall continue the implementation andcompletion of the Pre-Feasibility Study and submit the Pre-F ibilit St d d t t th GCA i l di

2) The Assessment of Land Acquisition and Resettlement thatproduces documents of land acquisition and resettlementplanning.

b. The GCA shall thoroughly evaluate and appraise the Document ofPre-Feasibility Study, under the criteria of:



1) economically and financial feasible; and

2) not in need of the Government Support in the terms of fiscalcontribution in financial form.

c. Based on the said evaluation, then:

1) In the event the Pre-Feasibility Study obtains an approval fromthe GCA:

a) The GCA shall issue an Approval Letter to the ProspectiveProponent to carry out a Feasibility Study and to fulfilprequalification requirements of public tender of a businessentity;

b) The GCA shall consult with BUPI in the event there is anindication that a Government Guarantee is needed, andshall informally convey the availability of the Pre-FeasibilityStudy document so that the application process to obtain theGovernment Guarantee can be started.

2) In the event under the evaluation of the GCA the Pre-FeasibilityStudy still requires improvement, the GCA shall issue aNotification Letter to the Prospective Proponent to perform theimprovement as requested by the GCA;

3) In the event the improvement of the Pre-Feasibility Studyacquires the approval from the GCA, the GCA shall issue aLetter of Approval to the Prospective Initiator to complete aFeasibility Study and to fulfil the prequalification requirements ofpublic tender of Business Entity; or

4) In the event under the evaluation of the GCA the Pre- Feasibilitystudy does not meet the said criteria, the GCA shall issue aNotification Letter to the Prospective Proponent to reject the the

PPP Project proposal.

3. The process for a Business Entity to obtain an approval from the GCA tobe designated as an Original Proponent of Unsolicited PPP project,includes 5 (five) activities:

1) The SKKL or recommendation of the UKL-UPL, andEnvironmental Permit from the Minister, Governor, or Regent/Mayor in accordance with its authority; and

2) Designation of Project Location from the Governor.

c. The GCA shall thoroughly evaluate and asses the Feasibility Study



g y y yDocument and the fulfilment of Prequalification Requirements underthe evaluation criteria of:

1) choice of modality;

2) project financing plan and source of fundings; and

3) proposed cooperation bid comprising the schedule, process andmethod of evaluation.

d. The GCA shall make the decision:

1) In the event the results of evaluation on the Feasibility StudyDocument and prequalification requirements have beensatisfactorily fulfilled, the GCA shall issue:

a) A letter of confirmation for the approval of the proposed PPP

Project as an unsolicited project;b) A letter of confirmation for the designation of the Prospective

Proponent as the Original Proponent of the unsolicitedproject;

c) A letter of confirmation for the provision of compensationoption for the Original Proponent.

2) To formally submit the Pre-Feasibility Study Document to the

BUPI for the implementation of application to obtain GovernmentGuarantee in accordance with the procedure as required by therespective laws and regulations.

e. The GCA shall decide on the provision of compensation:

1) In the event the decision of the provision of compensation optionis in the form of purchasing the intellectual property rights of theOriginal Proponent therein by the GCA or by the tender winner,then:

a) The Original Proponent is not allowed to participate in thebid process as stipulated in the Public Tender Document;

b) The Purchase of the intellectual property rights of the

d) The Original Proponent that has obtained compensation inthe form of intellectual property rights purchase, is notallowed to use or reveal (any information from the various

documents produring during the management process of theunsolicited project proposal) in part or in whole for anypurpose whatsoever and to anyone without a written



p p yapproval from the GCA; and

e) A shareholder of the Original Proponent, whose intellectualproperty rights of the unsolicited project proposal has beenbought, is prohibited to participate in the process of publictender of Business Entity.

2) In the event the form of compensation to be determined by theGCA is either the provision of added value (bonus system) to theOriginal Proponent or right to match system by the OriginalProponent to the best bidder in accordance with results in thetender process, then:

a) The Original Proponent shall participate in the bid asrequired in the Public Tender Documents.

b) All Feasibility Studies including the supporting documentsthereof shall immediately become the property of the GCAwithout reimbursement or compensation in any formwhatsoever.

3) On matters regarding the land acquisition, the GCA shallformally prepare the process of the land acquisitionimplementation by first submitting the draft budget for the landacquisition to the Minister of Finance in order to obtain an

approval from the DPR/DPRD.

A Flowchart of the steps to obtain the GCA approval for the proposal ofUnsolicited PPP Project is summarized in Sub Attachment VI constitutinginseparable part of this Minister Regulation.

C. Implementation of Public Tender for Unsolicited PPP Project

1. Implementation of public tender for Unsolicited PPP Project which isintended to ensure the transparency and competition as well as to enhancethe accountability and good governance of public tender of unsolicited PPPProject shall be carried out through a competitive public tender mechanismin adherence to the principles of:

c. Transparent, means that all requirements and information related to theProvision of Infrastructure including the technical requirements toadminister the selection process, evaluation procedures, and the course

of final decision of the preferred bidder shall be open to all BusinessEntities and the public in general;

d Competitive means that the selection of Business Entity shall be carried



d. Competitive, means that the selection of Business Entity shall be carriedout through tender process;

e. Accountable, means that results of the selection of Business Entity canbe accounted for;

f. Partnership based on principles of:

1) Mutual benefits, means to accomplish balanced terms andconditions that will provide advantages and benefits for both partiesand the community by calculating the basic needs of the community;

2) Mutual needs, means the cooperation carried out on is based on theterms and conditions considering the needs of both parties; and

3) Mutual supports, means the cooperation is carried out with the spiritto mutually support each other from both parties.

2. Process of public tender of Unsolicited PPP Project shall be carried out in 2(two) stages;

a. Planning of Public Tender of Business Entity; and

b. Implementation of Public Tender of Business Entity.

3. Stage of Planning of Public Tender of Business Entity

a. In the stage of Planning of Public Tender of Business Entity, the GCA

shall prepare the Plan of Public Tender of Business Entity after theProspective Proponent obtains the designation from the GCA as theOriginal Proponent, and after the GCA determines the form ofcompensation to be provided to the Original Proponent.

b. The Planning of Public Tender of Business Entity as intended in number2 letter a comprises of 2 (two) activities,

1) Formation of Procurement Committee; and

2) Preparation of Procurement Plan.c. The Procurement Committee as intended in letter b point 1) shall be

formed by the GCA by fulfilling the following requirements:

1) The GCA shall form a Procurement Committee with the total

3) One of the members of the Procurement Committee shall constitutea member of the PPP Project Management Team.

4) Members of the Procurement Committee shall at least comprise of

the parties that understand, know and master:

a) procedures of procurement;



b) scope of work of PPP Project;

c) law of agreements or contracts and provisions of laws andregulations applied in the infrastructure field of the relatedsector;

d) technical aspects; ande) financial aspects.

5) Member of the Procurement Committee is not allowed to have any Affiliation relationship with members of another ProcurementCommittee or with the prospective tender participant, tenderparticipant or consultant.

6) In the event at the time of implementation of the procurement it is

found out that one of the members of the Procurement Committeehas any Affiliation relationship with a member of anotherProcurement Committee or with a prospective tender participant,tender participant, or consultant, then the said member of theProcurement Committee shall submit to the GCA pertaining to thesaid matter and the GCA shall replace the said member of theProcurement Committee.

7) Each decision of the Procurement Committee shall be made based

on deliberation to reach consensus.In the event a decision could not be made through deliberation to reachconsensus then the decision-making shall be carried out based on amajority vote (each member of the Procurement Committee has 1 (one)vote that cannot be represented by another member of the ProcurementCommittee).

d. Preparation of procurement plan as intended in letter number 2)shall be carried out by the Procurement Committee under the followingactivities:

1) preparation of procurement schedule and concept of procurementannouncement;

e. The preparation of Procurement Schedule and Concept of Procurement Announcement as intended in letter d number 1) shall meet the followingprovisions:

1) The Procurement Committee shall prepare the schedule ofimplementation of public tender of the Business Entity;

2) Sched le of implementation of p blic tender of the B siness Entit



2) Schedule of implementation of public tender of the Business Entityshall provide sufficient time allocation to carry out all stages ofprocurement of Business Entity.

3) The Procurement Committee shall prepare concept of the publictender announcement.

f. The preparation of Prequalification Documents as intended in letter dnumber 2) shall meet the following provisions:

1) The Procurement Committee shall prepare PrequalificationDocuments.

2) The Prequalification Documents shall at least contain the following:

a) brief elucidation of the PPP Project on the initiative of BusinessEntity, and the form of compensation to be provided to the

Business Entity Initiator or Foreign Legal Entity;

b) the form or format of Documents of Expression of Interest;

c) qualification requirements of prospective Tender Participant;

d) schedule of implementation and procedures of prequalificationevaluation; and

e) the GCA shall determine the Prequalification Documents.

g. The preparation of HPS (owner’s estimate) as intended in letter dnumber 3) shall meet the following provisions:

1) The Procurement Committee shall thoroughly prepare the HPS(owner’s estimate) based on the report of pre-feasibility study of thePPP Project.

2) Calculation of the HPS (owner’s estimate) shall cover the costs ofinvestment comprising of the project costs, interest commission,

assumption of interest and escalation.3) Project costs shall comprise of planning costs, construction costs

and supervision costs, operational and maintenance costs as wellas the costs of land acquisition if any.

6) The HPS (owner’s estimate) calculation may be conducted byappointing an independent consultant.

7) The GCA shall determine the HPS (owner’s estimate) prepared by

the Procurement Committee.

h. Preparation of Public Tender Documents as intended in letter d number4) shall meet the following provisions:



4) shall meet the following provisions:

1) The Procurement Committee shall prepare the Public TenderDocuments.

2) Public Tender Documents shall at least contain:

a) invitation to Tender Participants;b) general provisions of procurement containing at least:

(1) scope of work, number of Bid Documents submitted, andreview of the PPP Project’s site;

(2) content of Public Tender Documents, elucidation of contentof Public Tender Documents, and alteration of content ofPublic Tender Documents;

(3) requirements of language used in the Bid Documents,writing of the bid price, bid currency and payment method,period of bid, letter of bid guarantee, proposal of alternativebids by Tender Participants, bid form, and signing of bidletter (for Prospective Tender Participant of foreign legalentity, the Bid Documents shall be prepared in accordancewith the language required in the Public TenderDocuments, while the supporting documents of the Bid

Document may use the official language of the said foreignlegal entity, under the provisions that the ProcurementCommittee may request official confirmation on the saidsupporting documents);

(4) method of putting into envelop and marking of envelope ofBid Documents, deadline of submission of Bid Documents,treatment to late Bid Documents, and prohibition foralteration and withdrawal of Bid Documents already

submitted;

(5) procedures of opening Bid Documents, clarification of BidDocuments, examination of completion of Bid Documents,arithmetic correction and conversion to single currency;

(8) PPP Contract already perfected by the ProcurementCommittee based on the term sheet of the PPP Contractprepared in the Pre-Feasibility Study Preparation stage;

(9) technical specifications and drawing;

(10) form of letter of bid;



(11) plan of cooperation form based on results of study to thePPP Project;

(12) project funding plan and the fund source thereof;

(13) form of bid bond letter in the form of bank guarantee issued

by a national bank or a foreign bank having branches inIndonesia and the amount of bid bond in the form ofpercentage of the PPP Project’s value;

(14) form of letter of performance bond in the form of bankguarantee issued by a national bank or a foreign bankhaving branches in Indonesia and the amount ofperformance bond in the form of percentage of the value ofthe PPP Project (the amount of execution guarantee value

may be deducted in stages according to the progress of thePPP Project as regulated in the PPP Contract);

(15) letter of confidentiality agreement executed by the TenderParticipant, declaring that the content of the Bid Documentmay not be used by the Tender Participant for the purposeother than participating in the procurement of PPP Projectand may not be widely spread to another party without aprior written approval from the Procurement Committee;

and(16) the method of submission of the Bid Document.

j. The market sounding as intended in letter d number 5) shall meet thefollowing provisions:

1) The GCA may hold the market sounding to obtain inputs and toknow the interest of prospective investor on the PPP Project to beoffered.

2) Market sounding may be conducted in various forms, among othersby performing road show, one-to-one meeting with potential nationaland international financial institutions.

1) The GCA may use the consultant service in charge of providinginputs and advice to the GCA in carrying out the Planning ofProcurement of Business Entity as well as accompanying or

representing the GCA in performing all activities related to theProcurement of Business Entity.

2) The appointed consultant by the GCA is not allowed to provide



consultation service and/or accompany and/or provide information toanother party in relation to the PPP Project in which the consultant isinvolved.

4. Implementation of Business Entity Procurement

a. Implementation of procurement of Business Entity as intended in number2 letter b shall be carried out through the public tender mechanism withthe following activities:

1) Prequalification;

2) Bid Implementation based on the compensation option to theOriginal Proponent:

a) added value (bonus system) to the Original Proponent; or

b) right to match by the Original Proponent to the best bidder.

3) Preparation of signing the PPP Contract.

b. Prequalification as intended in letter a number 1) includes the followingactivities:

1) Prequalification Announcement.

a) The Procurement Committee shall widely announce on the

presence of prequalification of Business Entity;b) Content of the announcement shall at least contain:

(1) name and address of the GCA that will conduct theprocurement of Business Entity;

(2) brief elucidation pertaining to the PPP Project to be carriedout, including status of the PPP Project that constitutes theinitiative of a Business Entity;

(3) estimated value of the PPP Project and terms of prospectivetender participant; and

(4) the place, date and time to take Prequalification Documents.

d) For the PPP Project that most likely attracts foreign investors,the announcement may be done through a printed media havinginternational circulation.

2) Implementation of Prequalification.

a) Procedures of Prequalification:

(1) announcement of prequalification for the procurement of



(1) announcement of prequalification for the procurement ofBusiness Entity shall be carried out by the method asoutlined in number 1);

(2) the Procurement Committee shall, on the date stipulated inthe prequalification announcement, register the prospective

tender participants;

(3) the prospective tender participant shall submit a Documentof Expression of Interest as requirements for takingPrequalification Documents, except the Original Proponentthat has met the prequalification requirements;

(4) the document of expression of interest shall be conductedat the same time with the prequalification process;

(5) in accordance with the schedule determined, prospectivetender participants shall submit the PrequalificationDocuments to the Procurement Committee, including theOriginal Proponent that despite having met theprequalification requirements is obliged to re-submit thePrequalification Documents;

(6) evaluation and clarification of Prequalification Documents;

(7) confirmation of list of prospective tender participant passingthe prequalification by the Procurement Committee;

(8) endorsement of prequalification results by the ProcurementCommittee;

(9) announcement of prequalification results;

(10) submission of challenge / objection by a prospective tenderparticipant who failed the prequalification to the GCA, shall

be done within 7 (seven) working days since the date ofannouncement of prequalification results;

(11) examination and follow up on the challenge againstprequalification results;

(14) in the event the prospective tender participants succeedingthe prequalification are less than 3 (three), theProcurement Committee shall conduct a repeated

prequalification:(a) Prospective tender participants that have passed the

previous prequalification do not necessary take part inthe repeated prequalification process;



the repeated prequalification process;

(b) The Procurement Committee shall announce therepeated prequalification by inviting new prospectivetender participants.

(15) In the event after the repeated prequalification wasconducted, and no addition of new tender participantpassing the prequalification or all tender participantspassing the prequalification are still less than 3 (three), theProcurement Committee shall continue to the stage ofprocess of Business Entity procurement.

b) Procedures of Prequalification Evaluation

Prequalification covers the evaluation of completion of the

following documents:

(1) validity of permits owned in order to be able to carry outbusiness activities thereof;

(2) deed of establishment and articles of association thereof;

(3) authority to sign a PPP Contract;

(4) structure of board of directors and board of commissioners;

(5) statement letter pertaining to status of the prospectivetender participant declaring that the prospective tenderparticipant is not being in remission, is not beingbankrupted, the business activity thereof is not beingsuspended, and/or not serving a criminal case (if theprospective tender participant is an Indonesian businessentity, the statement letter shall be signed over a dutystamp. If the prospective tender participant is a foreign

business entity, the said statement letter shall be legalizedby the public notary and consularized by the Indonesianembassy or consulate in the country where the saidstatement letter was signed);

of prospective tender candidate was founded less than 1(one) year, then the financial statement used is thefinancial statement of its holding company);

(9) letter of financial support from the bank;

(10) letter of support from shareholders (sponsorshipagreement);



(11) availability of special equipment, special experts required,or certain experience for special/ specific/ high-technologywork; and

(12) In the event the prospective tender participant is a

consortium, the evaluation above shall cover each memberof the consortium and it shall submit a consortiumagreement that clearly shows chairman of the saidconsortium. In the event the prospective tender participantis a limited liability, completion of the above documentsshall also cover the shareholders thereof.

c. Implementation of Bid as intended in letter a number 2) covers thefollowing activities:

1) Preparation of List of Participants, Submission of Invitation andTaking of Public Tender Document.

a) The Procurement Committee shall prepare the list of prospectivetender participants passing the prequalification to be formallyendorsed by the GCA.

b) List of prospective tender participants passing theprequalification shall be announced in the official board or

website of the GCA.

c) Prospective tender participants passing the prequalification,including the Original Proponent, are invited to take PublicTender Document.

d) Prospective tender participants passing the prequalification areentitled to take Public Tender Document from the ProcurementCommittee by paying a certain amount as declared in the

Procurement Document.2) Elucidation of Procurement

a) Elucidation of procurement shall be carried out at the place and

c) In the event of elucidation of procurement, the following shall beelucidated to the prospective tender participants:

(1) procurement method;

(2) procedures of submission of the Bid Document;

(3) documents that shall be attached in the Bid Document;

(4) d f i f th Bid D t



(4) procedures of opening of the Bid Document;

(5) method of bid evaluation;

(6) matters that can abort the bid;

(7) concept of PPP Contract;

(8) provisions and method of bid evaluation in respect of pricepreference on the use of domestic production; and

(9) amount, period and the party that may issue the bid bond.

d) If deemed necessary, the Procurement Committee may providefurther elucidation by conducting field inspection.

e) Especially for the discussion of the Draftt of the PPP Contract,

the Procurement Committee may hold a meeting with eachprospective tender participant separately (competitive dialogue)to accommodate feedbacks or comments from each prospectivetender participant to the concept of the PPP Contract.

f) Every feedback or comment from each prospective tenderparticipant shall be articulated in the minutes signed by theProcurement Committee and representative of the prospectivetender participant providing the said feedback or comment. The

Procurement Committee shall guarantee the confidentiality ofinformation obtained at the separate meeting with eachprospective tender participant (probity).

g) Alteration on the concept of the PPP Contract shall be reportedby the Procurement Committee to the GCA to obtain itsapproval.

h) The Procurement Committee shall submit alteration over the

concept of the Cooperation Contract to all prospective tenderparticipants prior to the deadline of the Bid Documentsubmission and shall constitute the final concept to be signed bythe Business Entity Winning the Tender (the Preferred Bidder).

are present, and forming one unit inseparable of the PublicTender Documents.

j) If in the BAP referred to in letter i) there are matters or new

provisions or significant alteration that need to beaccommodated, the Procurement Committee shall include theminto the alteration of the Public Tender Document.

3) S b i i f Bid D t



3) Submission of Bid Document

a) Method of submission of the bid Document shall be specified inthe Public Tender Document.

b) Method of submission of the Bid Document shall use the 2 (two)-

envelope method, namely envelope I containing administrativeand technical documents, and envelope II containing financialdocuments, then the said two envelopes shall be entered into 1(one) closed envelope and submitted at the same time to theProcurement Committee.

c) The Bid Document shall be submitted in accordance with theplace, date and time as specified in the Public TenderDocument.

d) The Bid Document shall be submitted directly by the prospectivetender participant to the Procurement Committee at the place,date and time already determined in the Public TenderDocument.

e) The Original Proponent that has submitted an Initial BidDocument while submitting the Feasibility Study Document, shallsubmit a Bid Document in accordance with the provisions

specified in the Public Tender Document.f) The Procurement Committee is not allowed to change the

deadline of the submission of the Bid Document unless it isapproved by all prospective tender participants that shall bearticulated in the minutes and alteration of the Public TenderDocument.

g) On the deadline of the submission of the Bid Document, theProcurement Committee shall open a meeting of opening the BidDocuments, declare before the prospective tender participantsthat the time for submitting the Bid Document has been closed inaccordance with the date and time already determined.

4) Opening the Bid Documents

a) The method of opening the Bid Documents shall be specified inthe Public Tender Document.

b) The Procurement Committee shall ask for the willingness of atleast 2 (two) presence tender participants to act as witnesses.

(1) If there is no representative of tender participant or there is



only 1 (one) representative of tender participant as awitness, the Procurement Committee shall postpone theopening of the Bid Documents for 2 (two) hours with theapproval of the presence tender participant.

(2) If the tender participants who are present do not agree topostpone the opening of the Bid Documents, then theopening of the Bid Documents shall be continued byappointing additional witness other than the ProcurementCommittee in writing by the Procurement Committee.

(3) If after being postponed for 2 (two) hours there is only 1(one)or no representative of tender participant as a witness, thenthe opening of the Bid Documents shall be continued by

appointing additional witness other than the ProcurementCommittee in writing by the Procurement Committee.

c) The Procurement Committee shall inspect the contents of thebox/ place of submission of the Bid Documents and verify thenumber of envelopes of the Bid Documents submitted.

d) The Procurement Committee shall inspect, show and readbefore the tender participants pertaining to the completion of the

Bid Document of each tender participant, covering:(1) Letter of bid specifying the period of bid but does not specify

the bid price;

(2) The original bid bond; and

(3) Technical documents and other supporting documentsrequired in the Public Tender Document.

e) The Procurement Committee may abort the Bid Documents at

the opening of bid, if the submission and completion of the BidDocuments are not in accordance with the Tender Document.

f) The Bid Documents shall then be initialized by the Procurement

tender participants appointed by the tender participants who arepresent.

i) In the event there is no tender participant appearing until the

deadline determined, then the BAPP shall be signed by theProcurement Committee and witnessed by 2 (two) persons otherthan the Procurement Committee appointed in writing by theProcurement Committee.



j) In the event there is only 1 (one) bid, the BAPP shall be signedby the Procurement Committee, representative of the tenderparticipant, and 2 (two) witnesses other than the ProcurementCommittee and the tender participant appointed in writing by the

Procurement Committee.

k) Copy of the BAPP shall be submitted to the representative of theappearing tender participants without being enclosed with the BidDocuments.

l) The Procurement Committee is not allowed to receive anyalteration or addition whatsoever to the Bid Documents submittedby the tender Participants after the deadline of submission of the

Bid Documents.m) The Bid Documents already received by Procurement

Committee shall become the documents of GCA and areconfidential.

5) Bid Evaluation

a) Bid evaluation shall be conducted in accordance with theprovisions already determined in the Public Tender Document.

b) The method of bid evaluation used shall be adjusted to the typeof infrastructure to be cooperated.

6) Making Minutes of Procurement Results

a) The Procurement Committee shall conclude the evaluationresults articulated in the BAHP.

b) The BAHP (minutes of results of the tender) shall contain resultsof the implementation of procurement, including method of

evaluation, formulas used, up to the decision of winnersequence in the form of list of tender Participants.

c) The BAHP shall be signed by the chairman and all members of

(1) names of all tender participants and bid price and/ orcorrected bid price of each bid participants;

(2) method of evaluation used;

(3) formulas used;

(4) other information deemed necessary pertaining to thecircumstances of implementation of procurement;



(5) date of making the minutes and number of tenderparticipants who passed and did not pass in eachevaluation stage;

(6) decision of sequence of 1 (one) prospective winner and 2(two) reserves;

(7) a statement that the procurement is declared to fail and re-procurement shall be conducted if there is not any bideligible.

(8) decision of sequence of 1 (one) prospective winner and 1(one) reserve, if there are only 2 (two) bidders eligible forthe requirements;

(9) a statement that the procurement declared to fail and re-procurement shall be made, or the said bidder isdetermined as a single prospective bidder if there is onlyone eligible tender participant.

(10) The BAHP shall also specify option of compensation formprovided to the Original Proponent in accordance with thePublic Tender Document, including the real results and the

results after the implementation of the said option by theOriginal Proponent.

7) Declaration of Tender Winner

a) The Procurement Committee shall declare the prospectiveTender Winner based on the results of evaluation.

b) For the procurement of Business Entity for the unsolicited PPPProject, the Procurement Committee should have also quantified

the added value (bonus point) for the Original Proponent orprovided a right to to match to the Original Proponent inaccordance with the Public Tender Document.

c) In the event the option of compensation determined by the GCA

(2) The value of the bonus point determined by the GCA priorto the procurement process shall be based on theevaluation criteria of the related sector.

(3) If after gaining the bonus point, the total value of theOriginal Proponent’s did evaluation is higher than the bestbidder, then the Procurement Committee shall determinethe Original Proponent as the prospective winner. In the

t it i l th th P t C itt h ll



event it is lower, then the Procurement Committee shalldetermine the best bidder as the prospective winner.

d) In the event the option of compensation determined by the GCAconstitutes the provision of the right to match by the Original

Proponent to challenge the best bidder in accordance with theresults of evaluation in the tender process, then:

(1) Within the maximum of 5 (five) working days since thedetermination of the BAHP, the Procurement Committeeshall notify the Original Proponent to exercise the rights tomatch.

(2) The maximum period of time for the Original Proponent to

submit the rights to match is 30 (thirty) working dayscommencing since the determination of the best bid fromthe public tender of PPP Project determined based on theevaluation criteria of the related sector.

(3) In the event the Original Proponent is willing to makealteration on the bid thereof as intended in letter b), theProcurement Committee shall make the alteration of theBAHP and then determine the alteration BAHP.

(4) In the event the Original Proponent submits the alterationof bid that may match the best bid, then the ProcurementCommittee shall determine the Original Proponent as theprospective winner of the public tender of the PPP Project.

(5) In the event the Original Proponent submits the alterationof bid that cannot match the best bid, then the ProcurementCommittee shall determine the best bidder as theprospective winner of the public tender of the PPP Project.

e) The Procurement Committee shall make and submit report tothe GCA to determine the Tender Winner.

f) The report as intended in letter e) shall be accompanied by the

h) In the event the GCA has different opinion from the proposal ofthe Procurement Committee, the GCA shall discuss it with theProcurement Committee in order to make decision and it shallbe articulated in the minutes containing the objection andagreement to be signed by the GCA and ProcurementCommittee (the decision takes the form of approving theproposal of the Procurement Committee or conducting re-evaluation which results shall be final).



evaluation which results shall be final).

i) Supporting data needed to determine the Tender WinnerBusiness Entity are:

(1) Documents of Public Tender, including the alteration (if any);

(2) BAPP;

(3) BAHP;

(4) Summary of process of procurement and results ofprocurement; and

(5) Bid Documents from prospective Tender Winner and reserveprospective winner.

j) In the event of delay in determining the Tender Winner andcausing the bid letter / bid bond expired, then confirmation shallbe made to all tender participants to extend the bid letter and bidbond.

k) In the event the Prospective Tender Winner refuses to extendthe validity of the bid letter and bid bond, the Prospective TenderWinner may withdraw without being imposed with any sanction.

8) Declaration of Single Biddera) The Procurement Committee shall declare a prospective single

bidder if there is only one tender participant participating in theprequalification and/or submitting Bid Documents and fulfillingthe administrative and technical requirements.

b) The Procurement Committee shall make and submit a report tothe Minister/ Head of Institution/ Head of Region pertaining tothe prospective single bidder.

c) The Minister/ Head of Institution/ Head of Region shall order theProcurement Committee to conduct negotiation with theprospective single bidder.

immediately extend the bid letter and bid bond prior to theexpiration thereof.

f) The Procurement Committee shall make and submit the BAHN

and other information to the Minister/ Head of Institution/ Head ofRegion.

g) The Minister/ Head of Institution/ Head of Region may refuse oragree with the results of implementation of negotiation based on



reasonable and accountable grounds.

h) In the event the Minister/ Head of Institution/ Head of Regionagrees with the negotiation, the Minister/ Head of Institution/Head of Region may determine the prospective single bidder asthe winner.

i) Supporting Data needed to determine the implementation ofnegotiation are:

(1) The Public Tender Documents, including the alterationthereof (if any);

(2) BAPP;

(3) BAHP;(4) Summary of tender process and tender results; and

(5) GCA’s determination of Single tender participant.

9) Announcement of Tender Winner/ Single Tender Participant Winner

a) Announcement of Tender Winner/ single Tender ParticipantWinner shall be announced in the official announcement boardof the GCA and shall be notified by the Procurement Committeeto all single bidder at the latest 2 (two) working days uponreceipt of the approval of determination of the Tender Winner.

b) In the event the single bidder is the only participant that passedthe prequalification, the submission to the single bidder is notneeded.

10) Issuance of Letter of Declaration of Winner

a) The GCA shall issue a Letter of Declaration of the TenderWinner of Business Entity as the executor of the PPP Project,under the provisions:

(1) there is no challenge from tender participants; or



j. If the second ranked prospective winner withdraws underreasons objectively unacceptable by the GCA, it shall be subjectto a sanction in the form of prohibition to participate in activitiesof public tender of Business Entity for PPP Project for 2 (two)consecutive years.

k. In the event the third ranked prospective winner withdraws underunacceptable reasons, it shall be subject to a sanction in theform of prohibition to participate in activities of public tender of



form of prohibition to participate in activities of public tender ofBusiness Entity for PPP Project for 2 (two) consecutive yearsand the GCA shall have the right to disburse the bid bond of thethird ranked prospective tender winner and it shall be deposited

to the state’s treasury as the Non-Tax State’s Revenue or in theevent the GCA is a Head of Region, it shall be deposited to theregional treasury as the regional revenue.

l. In the event the first, second and third prospective winnerswithdraw; the Procurement Committee shall conduct a repeatedpublic tender.

m. Declaration Letter of the tender winner shall be made at thelatest 5 (five) working days after the announcement of

determination of the tender winner and shall immediately besubmitted to the tender winner.

n. One of the copies of the Letter of Declaration of Tender Winnershall be submitted (without attachment) at least to the workingunit that will monitor the implementation of the PPP Contract.

11) Issuance of Letter of Declaration of Single Winner

a) The GCA shall issue a Letter of Declaration of Single Winner of

Business Entity as the executor of the PPP Project based on theBAHN (minutes of result of negotiation) under the provisions:

(1) There is no protest from tender participants or the truth ofthe protest received by the GCA in the protest period turnsout to be not provable or the protest received has surpassedthe protest period.

(2) This Letter of Declaration is not applicable in case the single

bidder is the only participant passing the prequalification.b) The single winner declared as the executor of the PPP Project

shall accept the said decision.

Head of Region, then it shall be deposited to the regionaltreasury as the regional revenue.

e) The single winner withdrawing under unacceptable grounds and

the bid period thereof is still valid, beside the related bid bondshall be disbursed and become the Non-Tax State’s Revenue orshall be deposited to the regional treasury, the said singlewinner is also subject to a sanction in the form of prohibition toparticipate in activities of public tender of Business Entity for the



pa c pa e ac es o pub c e de o us ess y o ePPP Project for 2 (two) consecutive working days.

f) In the event the single winner is a consortium, then all membersof the said consortium either severally or jointly are subject to a

sanction in the form of prohibition to participate in activities ofpublic tender of Business Entity for PPP Project for 2 (two)consecutive years.

g) If the single winner withdraws, the Procurement Committee mayconduct a repeated public tender.

h) Declaration Letter of single winner shall be made at the latest 5(five) working days after the announcement of the single winner

and shall be immediately submitted to the single tenderparticipant winner.

i) One of the copies of the Declaration Letter of Single Bidder shallbe submitted (without attachment of the PPP Contract) at leastto a working unit that shall monitor the execution of theCooperation Contract.

The Flowchart of steps for the implementation of procurement (publictender) for the Unsolicited PPP Project is summarized in Sub

Attachment VII constituting an entirety and inseparable part of thisMinister Regulation.

D. Preparation for the Signing of the PPP Contract

1. Process of establishing a Special Purpose Company(SPC)/ Business Entity

a. A Tender Winner shall establish a Special Purpose Company

(SPC)/Business Entity that shall sign a PPP Contract.b. The SPC/Business Entity should have been legally established at the

latest within 6 (six) months since the issuance of Letter of Declaration ofthe Tender Winner or Letter of Declaration of Single Winner by the GCA

c. Conditions precedent as intended in number 2 letter b are among othersthe issuance of approval of Government Guarantee and obtaining allpermits needed by the Business Entity to carry out its line of business.

d. The financial close shall not constitute conditions precedent in order thatthe PPP Contract shall become effective.

e. In the event all conditions precedent have been fulfilled, the GCA shallissue minutes pertaining to the effectiveness the PPP Contract.



E. Documents

1. Important documents generated from the management process for

Unsolicited PPP Projects are:

a. Documents of Project Concept.

b. Documents of Pre-Feasibility Study.

c. Documents AMDAL (KA ANDAL, RKL-RPL) or already-filled-in UKL-UPLforms.

d. Documents of land acquisition and resettlement plan.

e. Documents of Feasibility Study.

f. Tender Documents.

g. Documents of PPP Contract.

h. Documents of Guarantee Agreement.

i. Documents of Regress Agreement.

2. Documents of Project Concept as intended in number 1 letter a, shall at least

cover:

a. The background of the PPP Project;

b. The description of the PPP Project, covering at least the legal basis,present condition of the PPP Project, and problems of infrastructureneeds;

c. The benefits of the PPP Project, covering at least concept of the PPPProject, potential to be cooperated, technical feasibility indication,

financial feasibility indication, potential of obstacles and environment,results of public consultation as well as the need of project management;

d. The scope of work; and

c. The proposed project funding and source of fund; and

d. The proposed cooperation proposition (covering the schedule, processand method of evaluation).

4. The outline and contents of documents as intended in number 1 letter b,letter c, letter d, letter f, letter g, letter h and letter i shall consistent with theprovisions as intended in Chapter IV.



STATE MINISTER OF NATIONAL DEVELOPMENT PLANNING/

HEAD OF NATIONAL DEVELOPMENT PLANNING AGENCY

signed

ARMIDA S. ALISJAHBANA

A t rue copy of its original

Head of Legal Bureau

signed

Emmy Suparmiatun

SUB ATTACHMENT I

REGULATION OF STATE MINISTER OF NDP/HEAD OF BAPPENASNUMBER 3 OF 2012

ON THE OPERATIONAL GUIDELINES MANUAL FOR THEIMPLEMENTATION OF PUBLIC PRIVATE PARTNERSHIP IN

THE PROVISIONOF INFRASTRUCTURE

THE PHASING OF PPP PROJECT DEVELOPMENT CYCLE



104



SUB ATTACHMENT IV


ON THE OPERATIONAL GUIDELINES MANUAL FOR THEIMPLEMENTATION OF PUBLIC PRIVATE PARTNERSHIPS

INTHE PROVISION OF INFRASTRUCTURE

THE PPP PROJECT DEVELOPMENT CYCLE WITH THE SUPPORTING ACTIVITIES



107

• Bid ImplementationProgram

INSTITUTION/AGENCY INVOLVED

Government Contracting Agenc y (GCA)BAPPENAS

GCA, KKPPI,

RMU

‐MOF,IIGF,

BKPM, BAPPENAS, BPN

GCA, RMU

‐MOF,IIGF,

BKPM,

BAPPENAS, KLHGCA, KKPPI, BKPM, BAPPENAS, RMU-MOF,

IIGF, BPN, KLH

ProjectReadiness

LAND ACQUISITION PROCESS

Public Consultation:Information Dissemination

Public Consultation:Consultative Interaction

Public Consultation:Market Sounding

Process for Requesting the RequiredGovernment Support and/or Guarantee

Completion of Pre-feasibility Study

(Final Business

Case)

OutlineBusiness

Case

Output:Project Preparation

Document

Project

Identifica-tion &

Selection

GS and/or GGConfirmation/In-

principl e Approval

Output:Daftar Prioritas Proyek

Dokumen Studi

Pendahuluan

Output:PPP Agreement

Guarantee &

. Regress Agreement

• Finalization & SigningPPP Agreement

• Bid Implementation

Management

Plan of the

Implementa-

tion of the PPP

Agr eement

Output:Financial

Close; EPCContract; O&M

Contract

Output

Pre-FS Document

ProjectPrioritiza-

tion

Management

of the

Implementa-

tion of the PPP

Agr eement

Output:Periodic

Reports onManagement

Contract Impl.

PHASE I:PLANNING

PHASE II:PROJECT PREPARATION

PHASE III:TRANSACTION

PHASE IV:CONTRACT MANAGEMENT

ENVIRONMENTAL IMPACT ASSESSMENT BY GCA EIA BY THE SPV

Allo cati on, disb ur sement ,monitoring process of GS and/or

dmonitoring & evaluation ofPerjanjian Guarantee & Regress

Agr eement

SUB ATTACHMENT V




THE MANAGEMENT PROCESS OF UNSOLICITED PPP PROJECT PROPOSALS



108

SUB ATTACHMENT VI




STEPS TO OBTAIN THE GCA APPROVAL FOR UNSOLICITED PROJECT PROPOSALS (STAGE I)

( P P )

Step

1A

Step

2A

Step 3A

Completion of



109

P r o s p e c t i v e P r o p o n e n t

T h e G o v e r n m e n t C o n t r a c t i n g A g e n c

y ( G C A )

1A

Preparation

of Project’s Concept &

PP

Qualification

• Pepared by

PP

• Submitted to

GCA

Completion

of

Documents

of Pre‐

Feasibility

study

• Performed

by PP

• Submitted

to GCA

Completion of

Documents of

Feasibility Study

and Fulfillment

of

Prequalification

Requirements

• Performed by

PP

• Submitted to

GCA

Step 1B

GCA evaluates

the Project

Concept of the

Prospective

Proponent (PP)

with criteria:

not included

in master

plan of the

related sector

Technically

shall be

integrated

with the

master plan

in the related

sector

• GCA reviews

PP

qualification

Step 1C

If the Project

Concept of the

PP r obtains an

approval from

the GCA:

• GCA shall

issue Letter

of Approval

to prepare

Pre‐Feasibility

study

• PP carries out

the Pre‐

Feasibility

study

according to

the Terms of

Reference

prepared by

the GCA

Step 2B

GCA

thoroughly

evaluates

Documents of

Pre‐Feasibility

study:

• Economically

and

financially

feasible

• Need no

Government

Support in

the form of

fiscal

contribution

Step 2C

If Pre‐Feasibility

study obtains

approval from

GCA:

• the GCA shall

issue

Letter to

Proceed to

Feasibility Study

• CP continues

with

implementation

of Feasibility

Study

Step 3B

GCA thoroughly

evaluates

Documents of

Feasibility Study

and

Documents of

Fulfillment of

Prequalification

Requirements:

• proposed of

cooperation form

• proposed of

project funding

and fund source

• proposed bid

(including

schedule, process

and method of

evaluation)

Step 3C

If Documents of

Feasibility Study obtains

approval from GCA:

• GCA shall

declarePP’s

proposal of PPP

Project as unsolicited

and PP is declared as

the Original

Proponent (OP)

• GCA determines

option of

compensation for OP

• If option is not

compensation of

purchase of

intellectual property

rights (IPRs), OP may

participate in

procurement

process

• IPRs”OP becomes the

property of GCA

without provision of

com ensation



STATE MINISTER OF NATIONAL DEVELOPMENT PLANNING/HEAD OF NATIONAL DEVELOPMENT PLANNING A GENCY

Signed

ARMIDA S. A LISJA HBANA A TRUE COPY OF ITS ORIGINAL

HEAD OF LEGAL BUREAU

Signed

EMMY SUPARMIATUN



111