world bank seminar on port reformsiteresources.worldbank.org/pppilp/resources/2.5.pdfworld bank...
TRANSCRIPT
Wor
ld B
ank
Sem
inar
on
Port
Ref
orm
LE
GA
L T
OO
LS
FOR
POR
T R
EFO
RM
byC
hris
tiaan
van
Kri
mpe
nL
L.M
.L
egal
Cou
nsel
A
qaba
Dev
elop
men
tCor
pora
tion
Has
hem
iteK
ingd
omof
Jor
dan
Apr
il 2n
d, 2
008
Aqa
ba D
evel
opm
ent C
orpo
ratio
n2
Intro
duct
ion
Port
s rep
rese
nt a
n In
tens
ive
Mix
of P
ublic
an
d Pr
ivat
e In
tere
sts
Ports
are
chi
ldre
n of
thei
r tim
e.M
any
esta
blis
hed
port
man
agem
ent s
truct
ures
be
cam
e ob
sole
te a
fter t
he in
trodu
ctio
n of
mar
ket
orie
nted
eco
nom
ies.
Glo
baliz
atio
n in
tran
spor
t wea
kene
d m
onop
olis
tic
posi
tion
of m
any
ports
.
Aqa
ba D
evel
opm
ent C
orpo
ratio
n3
His
tory D
omin
ance
of P
ublic
Sec
tor
Form
er C
omm
unis
t Blo
c: p
orts
wer
e pa
rt of
M
inis
try o
f Tra
nspo
rt an
d/or
Nat
iona
l Shi
ppin
g Li
ne.
Con
tinen
tal
Wes
tern
Eur
ope:
Lan
dlor
d po
rts
(NW
) and
Too
l Por
ts (M
edite
rran
ean)
UK
: Por
t Tru
sts (
Serv
ice
Ports
)U
SA: P
ort A
utho
ritie
s (La
ndlo
rd)
Aqa
ba D
evel
opm
ent C
orpo
ratio
n4
Mor
e H
isto
ry
Dom
inan
ce o
f Pub
lic S
ecto
rA
sian
and
Afr
ican
por
t stru
ctur
es w
ere
usua
lly
copi
ed fr
om th
e fo
rmer
mot
her c
ount
ries.
UK
-orie
nted
type
s of S
ervi
ce P
orts
dom
inat
ed th
e sc
ene.
In
Sou
th A
mer
ica,
man
y N
atio
nal P
ort A
utho
ritie
s w
ere
crea
ted
as p
art o
f the
Sta
te st
ruct
ure.
Maj
ority
of w
orld
por
ts in
198
0s: e
xpen
sive
, in
effic
ient
, ove
rman
ned
and
poor
ly m
aint
aine
d.
Aqa
ba D
evel
opm
ent C
orpo
ratio
n5
Pres
ent S
ituat
ion
Mai
n Tr
ends
Land
lord
Por
ts b
ecam
e do
min
ant m
odel
Port
Aut
horit
ies e
volv
ed in
to in
fras
truct
ure
oper
ator
sSh
ift o
f inv
estm
ents
from
pub
lic to
priv
ate
sect
or
Port
oper
atio
ns w
ere
priv
atis
edR
ise
of th
e gl
obal
term
inal
ope
rato
rs
Aqa
ba D
evel
opm
ent C
orpo
ratio
n6
Legi
slat
ion Po
rt L
egis
latio
nM
ost c
ount
ries e
nact
ed n
ew p
orts
law
s, cr
eatin
g th
e in
stitu
tiona
l fra
mew
ork
for t
he re
latio
n be
twee
n th
e St
ate,
the
port
city
and
the
Port
Aut
horit
y. M
ain
issu
es a
re:
–Es
tabl
ishm
ent o
f Nat
iona
l or l
ocal
por
t aut
horit
ies
–Le
gal s
tatu
s of P
ort A
utho
ritie
s–
Fina
ncia
l and
fisc
al re
latio
ns b
etw
een
the
gove
rnm
ent
(nat
iona
l and
/or l
ocal
) and
the
Port
Aut
horit
y–
Ow
ners
hip
of p
ort l
and
and
port/
term
inal
infr
astru
ctur
e
Aqa
ba D
evel
opm
ent C
orpo
ratio
n7
Priv
atis
atio
n
Priv
atis
atio
n of
Por
t Aut
hori
ties
Port
auth
oriti
es a
re u
sual
ly p
art o
f the
pub
lic
dom
ain.
Onl
y in
a fe
w c
ount
ries p
ort a
utho
ritie
s ar
e fu
lly p
rivat
ised
(UK
, New
Zea
land
).Pr
ivat
isat
ion
of a
por
t aut
horit
ies m
eans
that
the
port
land
is p
rivat
ely
owne
d.D
isad
vant
ages
:–
Publ
ic se
ctor
lose
s lon
g te
rm d
evel
opm
ent o
ptio
ns.
–Po
rt la
nd su
bjec
t to
spec
ulat
ion
–Po
ssib
le c
reat
ion
of p
rivat
e m
onop
olie
s
Aqa
ba D
evel
opm
ent C
orpo
ratio
n8
The
Cha
ngin
g W
orld
Inst
itutio
nal S
truc
ture
sPo
rt au
thor
ity a
s par
t of n
atio
nal o
r reg
iona
l go
vern
men
t (G
erm
any)
Port
auth
ority
as c
orpo
rate
ent
ity b
y la
w (L
atvi
a,
Sri L
anka
, Guj
arat
, Tan
zani
a)C
orpo
ratis
ed P
ort A
utho
rity
by la
w (A
ustra
lia,
Pola
nd)
Cor
pora
tised
Por
t Aut
horit
y on
the
basi
s of t
he
Com
pani
es A
ct (T
he N
ethe
rland
s)
Aqa
ba D
evel
opm
ent C
orpo
ratio
n9
Obj
ectiv
es
Obj
ectiv
es o
f a P
ort A
utho
rity
The
obje
ctiv
es o
f Por
t Aut
horit
ies d
iffer
ed fr
om
coun
try to
cou
ntry
.In
gen
eral
, a P
ort A
utho
rity
is c
harg
ed w
ith th
e ef
ficie
nt a
nd e
cono
mic
al m
anag
emen
t of t
he p
ort.
It sh
ould
mak
e a
prof
it to
enh
ance
its l
ong
term
de
velo
pmen
t but
shou
ld n
ot m
ake
exce
ssiv
e pr
ofits
!B
UT…
……
……
…..
Aqa
ba D
evel
opm
ent C
orpo
ratio
n10
Para
dox
Vank
rim
pen’
sLaw
The
wor
se th
e Po
rt A
utho
rity,
th
e hi
gher
its p
rofit
s….
Aqa
ba D
evel
opm
ent C
orpo
ratio
n11
The
Pref
erre
d C
hoic
e
Land
lord
Por
t The
Pre
ferr
ed C
hoic
e!
Wor
ld B
ank
enco
urag
es G
over
nmen
ts to
est
ablis
h la
ndlo
rd-ty
pe P
ort A
utho
ritie
s.C
hang
ing
from
a S
ervi
ce to
a L
andl
ord
Port
requ
ires a
fund
amen
tal c
hang
e of
app
licab
le la
ws
and
regu
latio
ns.
Full
priv
atiz
atio
n (in
clud
ing
publ
ic fu
nctio
ns) i
s co
nsid
ered
an
unde
sire
d op
tion.
Aqa
ba D
evel
opm
ent C
orpo
ratio
n12
Trad
ition
al A
ctiv
ities
Trad
ition
al A
ctiv
ities
Lan
dlor
d Po
rtLa
nd d
evel
opm
ent a
nd m
anag
emen
tC
onst
ruct
ion
of p
ort i
nfra
stru
ctur
eR
egul
atio
n of
safe
ty, s
ecur
ity a
nd e
nviro
nmen
tN
autic
al ta
sks (
optio
nal)
Gra
ntin
g an
d m
onito
ring
conc
essi
ons &
leas
esR
epre
sent
ing
the
port
com
mun
ity a
nd
furth
eran
ce o
f ter
min
al o
pera
tors
Aqa
ba D
evel
opm
ent C
orpo
ratio
n13
Non
Tra
ditio
nal A
ctiv
ities
Non
-trad
ition
al a
ctiv
ities
Lan
dlor
d Po
rtD
evel
opm
ent o
f val
ue a
dded
serv
ices
, D
istri
park
s, W
TC, p
ort c
omm
unity
syst
ems.
Trai
ning
of p
ort a
nd te
rmin
al m
anag
ers.
Inte
grat
ion
with
inla
nd tr
ansp
ort s
ervi
ces.
Dev
elop
men
t of i
nlan
d te
rmin
als.
Tran
sfor
mat
ion
into
a G
loba
l Ter
min
al O
pera
tor
(Por
t of S
inga
pore
).
Aqa
ba D
evel
opm
ent C
orpo
ratio
n14
Cor
pora
tisat
ion
Cor
pora
tised
Por
t Aut
hori
ties
Tren
d to
cor
pora
tise
port
auth
oriti
es, e
ither
und
er
Lex
Spec
ialis
or u
nder
the
Com
pani
es A
ct.
The
publ
ic in
tere
st re
quire
s tha
t at l
east
maj
ority
of
the
shar
es a
lway
s be
and
rem
ains
to b
e ow
ned
by th
e pu
blic
sect
or (S
tate
, reg
iona
l gov
ernm
ent
and/
or th
e po
rt ci
ty).
No
shar
e ow
ners
hip
by p
rivat
e po
rt op
erat
ors a
nd
trans
port
rela
ted
firm
s sho
uld
be a
llow
ed.
Aqa
ba D
evel
opm
ent C
orpo
ratio
n15
The
Trad
ition
al W
ay
Mon
ey R
ules
The
Wav
esTr
aditi
onal
Lan
dlor
d Po
rts in
vest
ed in
bas
ic
port
infr
astru
ctur
e an
d po
rt si
tes (
quay
wal
ls
and
land
recl
amat
ion)
mai
nly
from
reta
ined
ea
rnin
gs.
They
der
ived
thei
r inc
ome
from
por
t due
s (f
or v
esse
ls) a
nd la
nd le
ase
(fro
m p
ort
oper
ator
s).
Aqa
ba D
evel
opm
ent C
orpo
ratio
n16
Tran
sitio
n
Tran
sitio
n fr
om S
ervi
ce P
ort t
o La
ndlo
rd P
ort
In th
e 19
80s a
nd 1
990s
the
vast
maj
ority
of
wor
ld p
orts
cha
nged
its m
anag
emen
t st
ruct
ure.
Man
y of
them
requ
ired
mas
sive
inve
stm
ents
fo
r mod
erni
satio
n an
d la
bour
refo
rm.
Whe
re w
ould
they
get
the
nece
ssar
y m
oney
?
Aqa
ba D
evel
opm
ent C
orpo
ratio
n17
The
New
Way
of F
inan
cing
New
Sou
rces
of F
inan
ceTh
e St
ate
(ofte
n di
ffic
ult o
r im
poss
ible
)Th
e In
tern
atio
nal F
inan
ce In
stitu
tes (
Wor
ld
Ban
k, A
sian
Dev
elop
men
t Ban
k, A
mer
ican
D
evel
opm
ent B
ank,
IFI,
Kuw
ait F
und)
The
Priv
ate
Sect
or (P
ort u
sers
, ban
ks)
thro
ugh
PPPs
.
Aqa
ba D
evel
opm
ent C
orpo
ratio
n18
Publ
ic P
rivat
e Pa
rtner
ship
s
Con
cess
ions
Wha
t Con
cess
ions
? Po
rt or
Ter
min
al…
…C
once
ssio
ns a
re a
n al
tern
ativ
e to
pub
lic fi
nanc
ing
of o
pera
tiona
l inf
rast
ruct
ure.
C
once
ssio
ns c
ombi
ned
with
BO
T sc
hem
es
beca
me
an a
ccep
ted
phen
omen
on in
the
indu
stry
.Ti
me
repe
ats i
tsel
f. C
once
ssio
ns w
ere
used
in
Hol
land
as f
ar b
ack
as th
e Se
vent
eent
h C
entu
ry.
Aqa
ba D
evel
opm
ent C
orpo
ratio
n19
Con
cess
ions Wha
t Is T
his T
hing
?Pu
blic
Lic
ense
or r
ight
s gra
nt b
y a
Port
Aut
horit
y to
ope
rate
, mai
ntai
n an
d tra
nsfe
r a p
ort t
erm
inal
fo
r a c
erta
in p
erio
d of
tim
e.B
OT:
Bui
ld, O
pera
te T
rans
fer,
the
right
to
cons
truct
a p
ort t
erm
inal
as p
art o
f the
con
cess
ion.
Site
Lea
se A
gree
men
t for
the
term
inal
are
a.A
num
ber o
f rel
ated
agr
eem
ents
incl
udin
g a
Lend
ers D
irect
Agr
eem
ent,
if re
quire
d.
Aqa
ba D
evel
opm
ent C
orpo
ratio
n20
Mai
n C
hara
cter
istic
s
Mai
n C
hara
cter
istic
sR
ight
/lice
nse
to p
erfo
rm p
ort o
pera
tions
du
ring
som
e 25
-35
yea
rs, d
epen
ding
on
inve
stm
ent p
rofil
e.Si
te L
ease
Agr
eem
ent f
or th
e sa
me
perio
d.Tr
ansf
er o
f ter
min
al a
nd a
sset
s to
Gra
ntor
af
ter t
erm
inat
ion
or e
xpiry
.Pa
ymen
t of r
oyal
ties a
nd le
ase
rent
s.
Aqa
ba D
evel
opm
ent C
orpo
ratio
n21
Con
cess
ion
+ B
OT
Adva
ntag
esLa
nd is
not
sold
and
will
be
retu
rned
to P
ort
Aut
horit
y or
Gov
ernm
ent a
fter c
once
ssio
n pe
riod.
Part
of in
vest
men
t ris
ks tr
ansf
erre
d to
Priv
ate
Sect
or.
Via
agr
eed
perf
orm
ance
crit
eria
por
t ope
ratio
ns
can
be m
onito
red.
Con
cess
iona
ire st
ays i
n th
e po
rt fo
r a lo
ng ti
me
guar
ante
eing
a st
eady
inco
me
for P
ort A
utho
rity.
Aqa
ba D
evel
opm
ent C
orpo
ratio
n22
Mai
n Ta
sks a
nd S
ervi
ces
Con
cess
iona
ire’
s Tas
ks a
nd S
ervi
ces
Empl
oyin
g po
rt w
orke
rs o
n fix
ed c
ontra
cts.
Ber
thin
g ve
ssel
s.St
eved
orin
g.In
tern
al tr
ansp
ort a
nd st
orag
e.M
aint
enan
ce o
f inf
rast
ruct
ure,
supe
rstru
ctur
e,
equi
pmen
t.A
chie
ve a
gree
d pe
rfor
man
ce c
riter
ia.
Aqa
ba D
evel
opm
ent C
orpo
ratio
n23
Roy
altie
s
Alte
rnat
ives
Roy
altie
s can
be
agre
ed:
–as
a fi
xed,
or v
aria
ble
amou
nt p
er u
nit (
TEU
, met
ric
tonn
e) d
epen
ding
on
quan
titie
s;–
as p
erce
ntag
e of
the
Gro
ss R
even
ue o
f the
Ter
min
al
(may
var
y be
twee
n 5%
and
20%
).M
inim
um G
uara
ntee
d Th
roug
hput
–th
is re
pres
ents
the
amou
nt o
f Roy
alty
to b
e pa
id in
any
ev
ent,
irres
pect
ive
of th
e ac
tual
thro
ughp
ut o
f the
te
rmin
al.
Aqa
ba D
evel
opm
ent C
orpo
ratio
n24
Term
inat
ion
Com
pens
atio
n
Prin
cipl
esTh
e Po
rt A
utho
rity
alw
ays p
ays t
erm
inat
ion
com
pens
atio
n at
exp
iry o
r ear
ly te
rmin
atio
n of
the
conc
essi
on.
A te
rmin
al c
once
ssio
n w
ithou
t ter
min
atio
n co
mpe
nsat
ion
is n
ot b
anka
ble.
The
amou
nt o
f ter
min
atio
n co
mpe
nsat
ion
depe
nds
on t
he w
ay th
e co
nces
sion
is te
rmin
ated
and
by
who
m.
Aqa
ba D
evel
opm
ent C
orpo
ratio
n25
Term
inat
ion
Com
pens
atio
n
Wha
t doe
s the
Por
t Aut
hori
ty p
ay?
Term
inat
ion
may
occ
ur a
s a re
sult
of:
–te
rmin
atio
n in
the
natio
nal i
nter
est;
–ex
piry
of t
he c
once
ssio
n;–
a m
ajor
bre
ach
of o
ne o
f the
par
ties;
–Fo
rce
Maj
eure
.C
ompe
nsat
ion
may
be
paid
on
the
basi
s of F
air
Val
ue o
r a p
erce
ntag
e of
the
net b
ook
valu
e of
the
inve
stm
ents
and
mov
able
ass
ets .
Aqa
ba D
evel
opm
ent C
orpo
ratio
n26
Term
inat
ion
Com
pens
atio
n
Hea
lth W
arni
ng
A P
ort A
utho
rity
shou
ld a
void
und
er
all c
ircum
stan
ces t
o pa
y Fa
ir V
alue
in
case
of t
erm
inat
ion
or e
xpiry
.
Exce
ptio
n: te
rmin
atio
n in
the
natio
nal i
nter
est.
Aqa
ba D
evel
opm
ent C
orpo
ratio
n27
Ban
kabi
lity
Inve
stm
ent R
equi
rem
ents
The
owne
rshi
p of
the
port
land
and
term
inal
in
fras
truct
ure
cons
truct
ed b
y a
Con
cess
iona
ire
unde
r a B
OT
rem
ains
with
the
Port
Aut
horit
y.Th
e C
once
ssio
naire
can
not m
ortg
age
the
term
inal
ar
ea o
r inf
rast
ruct
ure.
The
Con
cess
iona
ire n
eeds
secu
rity
for t
he b
ank
to
finan
ce it
s inv
estm
ents
in th
e te
rmin
al.
The
bank
s in
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ited
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urse
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anci
ng o
n th
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sis o
f a L
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irect
A
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men
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evel
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aw
Con
cess
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ver…
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con
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pris
e pr
ovis
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f la
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s.D
urin
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e te
rm o
f the
con
cess
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chan
ges i
n la
ws
and
regu
latio
ns m
ay m
ake
the
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ness
unp
rofit
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.In
such
cas
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rt A
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mpe
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llow
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rvic
e ch
arge
s, ex
tens
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of th
e te
rm o
f the
con
cess
ion
or
pay
a (o
ne ti
me)
com
pens
atio
n.