The government of Lithuania last Thursday gave the green light to a new concession law that aims to “set an adequate, balanced and flexible” framework for the award of public projects.
Part of an effort to transpose an EU directive that is meant to ensure “non-discriminatory access to the market to all of the Union’s economic operators,” the changes include an uncapped maximum contract term, the opportunity for more types of public entities to launch concession projects and the possibility for a wider range of candidates to bid for them.
The new framework also allows for greater flexibility in the transfer of public assets by concessionaires and defines clear rules for calculating concession value.
“Increased consistency in regulation across the market of the European Union will provide an even more secure and transparent path for new international investors seeking to set foot in Lithuania, while increased flexibility in terms of asset use and project length will allow the country to offer a more attractive pipeline,” said Tadas Jagminas, director of the project management department at state-owned body Invest Lithuania.
The Baltic country has made headways since calling for proposals for the country's first central government-level infrastructure PPPs in 2009. Following suit on its appetite for the framework at a time of tepid enthusiasm for PPPs across Europe, Lithuania has since selected bidders for a number of projects. That included the €36 million Palanga Bypass, the first Lithuanian PPP to reach financial close, in 2013.
Last week, funds controlled by local firm Lords LB Asset Management acquired the concession for the transport node left of the M K Ciurlionis bridge in Kaunas, with 16 years remaining. Earlier this year, Lords LB became the first asset manager to launch a dedicated, Baltics-focused infrastructure fund when it started raising the vehicle with a €250m hard-cap.