Global Liberalisation of Public–Private Partnerships (PPPs) as Form of State-Controlled Enterprises (SCEs)

Public projects in the field of public infrastructure, energy, utilities, or any significant public projects are increasingly outsourced via public–private partnerships (PPPs) and lure multinational enterprises spanning their operations across multiple jurisdictions with varying market entry barriers for foreign investors. The incentives and hindrances to participation in PPPs by such foreign investors could be tied to the level of international liberalisation, primarily of government procurement markets, and secondarily of investment and provision of services in heavily regulated sectors, like utilities. These also rest on proper protection of investment by foreign persons, along with the position of such persons in resolving controversies that might arise between a public and a private partner. The opening of PPP markets is increasingly addressed in procurement chapters of high-standard regional trade agreements (RTAs) like the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). This follows the developments in the World Trade Organization (WTO) Government Procurement Agreement (GPA) and EU procurement directives whereby PPPs have been gradually incorporated into coverage of the WTO GPA by the back door, i.e. party-specific schedule of commitments and EU’s public-procurement-derived procedural framework has been gradually perfectioned to reflect the complexity of PPPs. The instruments like the General Agreement on Trade in Services (GATS) and the Agreement on Trade-Related Investment Measures (TRIMs) are relevant for the liberalisation of PPPs to the extent that general-commerce freedom of the provision of services and investment by foreign persons in most cases is a prerequisite for access to PPP markets. The related dispute-settlement issues can be differentiated into disputes emerging before and after the conclusion of PPP contractors. Market-access procurement-derived instruments set a framework for resolving disputes between potential private partners competing for PPP contracts on the one side with contracting authorities (public partners) on the other side. Such instruments also largely secure the stability of PPPs agreement, adding to the investment-protection environment. In turn, the bilateral investment agreements (BITs) and investment chapters of RTAs in principle cover PPPs classifiable as a foreign investment despite excluding public procurement from their scope of application expressly