Guidelines for early Resolution of Stuck Public Private Partnership (PPP) projects at Major Ports

May 11, 2022 | Business


Background


In the past decade, Government of India invited private investment into Major Port Sector and several projects were awarded under Design, Built, Finance, Operate & Transfer (DBFOT) basis across the Major Ports in the country.  Since the implementation of first PPP project at Major Port in 1997, significant progress has been made through this method of implementation. Notable benefits including private investment, capacity addition and operational efficiency has contributed to the growth of the sector. Currently, 34 projects of over INR 27,000 crore are operational and 25 projects of over INR 14,000 crore are under implementation. The operational projects have added a capacity of around 350 MTPA at Major Ports.


Under Asset Monetisation, there is clear pipeline of 31 projects of Rs. 14,500 Cr. to be awarded by 2025. Apart from current pipeline of 31 projects under NMP, additional 50 projects (of value ~INR 27,500 crore) have been identified for offer under PPP. Out of these 50 projects, 14 projects (~INR 2,400 crore) are envisaged to be offered in FY 2022-23.


In order to encourage private investment in the Major Port sector and standardise the diligence process for implementation of such projects and encourage EoDB, the Ministry has undertaken many initiatives in terms of preparation of policies/ guidelines.


With the aim to reduce arbitrations and litigation in the sector, new Model Concession Agreement (MCA) was launched by the Minister of MoPSW on 21st November 2021. The new document provides clarity on responsibilities and obligations of parties along with remedial measures in case of change in law. Apart from new MCA, new Tariff Guidelines have been issued with the focus on flexibility to PPP player to fix tariffs as per market dynamics, provide level playing field for competition between private terminals at major port and private port, facilitate better utilization of the capacity and introduce differential royalty rate to promote coastal shipping and transshipment


Despite all the policy level initiatives to mitigate the possibilities of litigation and encourage EoDB and due diligence and caution at the time of conceptualizing these projects from various perspectives, the survival of some of the projects is at risk due to various reasons like aggressive bidding and optimistic projections with regard to volumes & charges, unforeseen dynamic changes in the business and absence of flexibility to overcome such dynamic changes in the Concession Agreements that were either not foreseen or are beyond the control of the collaborating partners, i.e., the Concessionaire and the Concessioning Authority.


The Guidelines


The Ministry of Ports, Shipping & Waterways has finalized the guidelines for dealing with Stressed Public Private Partnership (PPP) Projects at the Major Ports on 10 May 2022.


These guidelines have been framed for:-


  1. Projects which became stressed during construction stage, i.e., Pre-COD stage i.e. where the work has stopped due to inability of Concessionaire to continue with the execution of the project because of the reasons inter-alia aggressive bidding and the optimistic projections with regard to volumes & charges, unforeseen dynamic changes in their business; and

  2. Projects, both at Pre-COD and Post-COD stage, which became stressed due to borrowings being categorized by the lenders to the projects as NPA and/or lenders have approached NCLT for recovery of their dues, i.e., the PPP projects undertaken by the Major Ports where the work has stopped due to inability of Concessionaire to continue with the execution of the project on account of borrowings of the Concessionaire having been categorized by lenders as NPA and / or proceedings initiated against it before the NCLT under the Insolvency and Bankruptcy Code 2016 or under Section 241(2) of the Companies Act 2013.


Mechanism for Resolution of Stressed Projects:


  1. In case of the projects which became stressed during construction stage i.e., Pre-COD stage, the Concessioning Authority would pay to the Concessionaire or to the lenders of the Concessionaire (as the case may be), as full and final settlement for taking over the useful assets created by the Concessionaire, an amount equal to the lower of the following sums 


  1. the value of the work done by the concessionaire in accordance with the Concession Agreement and found useful by the major port (i.e. the Concessioning Authority); or

  2. 90% of Debt Due as defined in the Concession Agreement; or

  3. Any other amount as may be mutually agreed in writing between the Concessioning Authority and the Concessionaire as per the relevant provisions of Model Concession Agreement (MCA) 2021.


  1. Projects which became stressed both at Pre-COD and Post-COD stage, due to borrowings being categorized by the lenders to the projects as NPA and/ or lenders have approached NCLT for recovery of their dues, i.e., the PPP projects undertaken by the Major Ports where the work has stopped due to inability of Concessionaire to continue with the execution of the project on account of borrowings of the Concessionaire having been categorized by lenders as NPA and / or proceedings initiated, the due process before the NCLT under the Insolvency and Bankruptcy Code 2016 or under Section 241(2) of the Companies Act 2013 will be followed.


The Benefits of the new Guidelines


The aim of the guidelines is to facilitate revival of the projects falling in the category of stressed projects.  These guidelines will pave the way for resolution of the cases under arbitration. The port asset is likely to be put to use through re-bidding.  This will definitely result in unlocking the blocked cargo handling capacity of approximately 27 MTPA thereby creating better trade opportunities for the prospective investors and Port Authority will start generating revenue.  It will repose confidence in the investors/ concessionaires and also generate employment opportunities.


Some of the long standing disputes on stressed assets at various major ports that may see early resolution are:


  1. Development of 13th Multipurpose Cargo (Other than Liquid/ Container Cargo) Berth on BOT Basis at Deendayal Port (1.50 MTPA approx.)

  2. Development of 15th Multipurpose Cargo Berth at Kandla at Deendayal Port (1.50 MTPA approx.)

  3. Offshore Container Terminal (OCT) at Mumbai Port (9.60 MTPA approx.)

  4. Construction of NCB-II at VOC Port (7.00 MTPA approx.)

  5. Berth EQ-1A at Visakhapatnam Port (7.36 MTPA approx.)


On this occasion, Shri Sarbananda Sonowal, Union Minister for Ports, Shipping and Waterways stated that “These Guidelines will facilitate for early resolution of various issues and revival of stressed projects along with unlocking the immense potential of those projects resulting in creation of more trade and job opportunities.”


******


MJPS




(Release ID: 1824427)
Visitor Counter : 630











Guidelines on victory processions regarding

Mar 10, 2022 | Business


Election Commission of India had announced General Elections to the Legislative Assemblies of Goa, Manipur, Punjab, Uttar Pradesh and Uttarakhand on 8th January 2022. Along with the announcement of the elections, Commission also issued Revised Broad Guidelines to regulate various aspects of elections including victory processions during the period of COVID. During the period of elections as the COVID situation improved, Commission gradually relaxed the norms concerning electioneering in consultation with Union Health Ministry and State Governments.


Viewing the current status of COVID-19 in these poll going states, Commission has decided to relax the guidelines on victory processions during and after the counting and has withdrawn the blanket ban on victory processions. However, this relaxation will be subject to existing instructions of SDMA and preventive measures, imposed by concerned district authorities.


****


RP




(Release ID: 1804685)
Visitor Counter : 401











Hong Kong – Contravention of Guidelines on Implementation of Real-name Registration for SIM Cards and licence condition by five licensees

Mar 8, 2022 | International

Contravention of Guidelines on Implementation of Real-name Registration for SIM Cards and licence condition by five licensees

******************************************************************************************


The following is issued on behalf of the Communications Authority:

 

     The Communications Authority (CA) announced today (March 8) its decision to issue directions pursuant to section 36B(1)(a) of the Telecommunications Ordinance (Cap. 106) to the five licensees listed below in respect of their contravention of the Guidelines on Implementation of Real-name Registration for SIM Cards issued by the CA and the relevant condition of their licences:

 

1. Hong Kong uCloudlink Network Technology Limited (Note 1);

2. Neware Info Technology Limited (Note 2);

3. Truphone (Hong Kong) Limited (Note 3);

4. Uhuibao International Business Co., Limited (Note 4); and

5. Ultra Data Technology Limited (Note 5).

 

     The Telecommunications (Registration of SIM Cards) Regulation (Cap. 106AI) took effect on September 1, 2021, to implement the real-name registration programme for subscriber identity module (SIM) cards. The Regulation requires that all newly effective SIM service plans and new pre-paid SIM (PPS) cards shall require real-name registration before activation from March 1, 2022, and existing PPS cards shall require real-name registration on or before February 23, 2023.

 

     The CA issued the Guidelines on August 20, 2021, to provide practical and administrative guidance to telecommunications service providers for implementation of the real-name registration programme in compliance with the Regulation. Among others, the Guidelines stipulate that telecommunications service providers shall put in place an electronic registration platform with a database for the SIM cards before March 1, 2022.  

 

     During its close follow-up with the relevant licensees, the Office of the Communications Authority (OFCA) noted that the above-mentioned five licensees failed to put in place in a timely manner an electronic registration platform in accordance with the Guidelines. Having considered OFCA’s assessment and the representations made by each of the five licensees concerned, the CA concluded that they have breached the Guidelines and the relevant condition of their licences. The CA’s directions were hence issued to these licensees today to require them to complete implementation of the electronic registration platform within three weeks and cease the sale, supply or activation of any new SIM cards with effect from March 1, 2022.

 

     For details, please refer to the CA’s directions (www.coms-auth.hk/en/policies_regulations/ca_decisions/index_yr_all-ca_75-sb_all-p_1.html) published on the CA’s website.

 

Note 1: Registered licensee of Class Licence for Offer of Telecommunications Services (CLOTS), registration no. CLOTS0000066.

Note 2: Registered licensee of CLOTS, registration no. CLOTS0000071.

Note 3: Holder of Services-based Operator Licence No. 1568.

Note 4: Registered licensee of CLOTS, registration no. CLOTS0000056.

Note 5: Registered licensee of CLOTS, registration no. CLOTS0000070.

Guidelines issued for fast and efficient vaccination of Civil Aviation Community

May 7, 2021 | Business

Ministry of Civil Aviation (MoCA) has issued enabling guidelines to facilitate the vaccination program in a fast and efficient manner to ensure timely vaccination of the aviation community. During the COVID-19 surge, the aviation community has worked tirelessly to ensure unhindered services for the movement of people in need and essential cargo including critical medical cargo like vaccines, medicines, Oxygen Concentrators, etc. Secretary, Civil Aviation sent a letter earlier to all the State Governments with a request to consider the personnel involved in aviation and related services as a priority group under the vaccination program.

As per the guidelines, all players in Civil Aviation Sector would be advised to cover their personnel under the ongoing vaccination program. Guidelines further state that the organizations which have already made arrangements with Government/Private service providers for the vaccination to their employees may continue to do so.

Further, a dedicated vaccination facility is advised to be established by the Airport Operators in their respective airports to facilitate expeditious vaccination for the personnel involved in aviation or related services (including the contractual, casual, etc.). It is stated that the Airport Operator should immediately contact State Governments/Private Service Providers (Hospitals), who are willing to set up Covid Vaccination Centres at Airports.

The guidelines state that required facilities like setting up of vaccination counters, segregated waiting area (pre as well as post-vaccination) are to be established by the Airport Operators. Basic facilities for the personnel visiting (help desk, drinking water, ventilation fans, washrooms, etc.) to be arranged following COVID safety protocols.The cost per vaccination dose can be decided by the Airport Operator with the service provider. These facilities would be available for all aviation sector stakeholders at the same cost.It further states that all agencies working in the airports eco-system need to sponsor their personnel to avail the facilities as operators/service providers would not be dealing with individual cases.Further, online Payment mechanism to the service provider for vaccine doses administered for their respective personnel has been advised to be devised.

It is stated that for the smaller airports (where the numbers to get vaccinated are less and private players do not find it viable), the Airport Operators can approach the District/local Administration for extending the vaccination program. The facilities created by Airport Operator would be available for all the Civil Aviation Personnel in first phase and can be extended to the family members subsequently.

The guidelines suggest that priority should be made to cover the ATC, crew of airlines (both cockpit and cabin), mission critical and passenger facing staff on priority. All Airport Operators have been advised to designate a nodal officer (an alternative nodal officer may also be kept in readiness) for coordinating the efforts.

The guidelines said that Chairman, AAI will hold regular meetings to review the progress and coordinate with the Ministry and DGCA to address issues and challenges.If there is an issue of vaccine availability Ministry would take up at appropriate level for smooth supply.

The order further mentions that considering any impending local situation, suggested guidelines may be contextualized and improved but all safety protocols and instructions issued by MoHFW, State Government Concerned or MoCA, related to COVID 19 must be followed.

Link to the Guidelines

***

NG

(Release ID: 1716483)
Visitor Counter : 11