Art.

1- Object: This law aims to establish standards and mechanisms to promote, through public-
private participation, investments in public infrastructure and in the provision of services that they
are intended or are complementary to them; well as in the production of goods and provision of
services that are themselves the subject of agencies, entities, public companies and companies in
which the State is party.
To this end, the law establishes the legal form of public-private participation contracts,
contemplated the figure of the private sector and regulates the use of trusts for the purposes set
out in this law.
Art. 2 - Principles and definitions: 1 All activities associated with this Law must observe the
following general principles:
a. Supervision and control of the State: The State has jurisdiction and powers of planning,
control, punishment, regulation, supervision and monitoring of the implementation of
contracts, subject to this Act.
b. Transparency and accountability: It will be made public information on contracts regulated
by this law, including acts involving fiscal commitments to the state that have effects on
users.
c. Social Performance: Any project carried out under the scope of this Act shall respond to
the realization of the common good in the public interest, clearly establishing the overall
objectives and benefits that the state pretendes to receive. The State shall define general
criteria for social returns, in order to evaluate each project prior to its implementation.
d. Economic efficiency: The contracts covered by this law should be structured to facilitate
the efficient management and use of infrastructure and services. The mechanisms of
public-private partnerships can only be used when, through economic and technical
studies, it is found that are efficient, effective and sustainable for the construction of the
work and the service option.
e. Competition and Equality: The selection of the private participants will be made by
transparent and competitive procedures, respecting the principles of non-discrimination,
equality and wide publicity to promote the participation of the largest number of
operators and select the private participant who can provide good or service in the most
efficient and effective manner.
f. Legal certainty: Contracts establish the regime of rights, obligations and responsibilities of
the parties; and may be modified in accordance with applicable regulatory and contractual
framework.
g. Seasonality: A contract should contemplate a maximum term, including any extensions,
shall not exceed thirty years, unless exceptional extensions provided in cases provided for
in Article 34 of this law. Where not specified in the contract deadline, it is understood that
this applies for the maximum term.
h. Fiscal responsibility: For investment made through contracts subject to this Act, must be
considered payment capacity of the state to meet financial commitments arising from the
implementation of projects, and proper accounting of firm and contingent commitments
future, within the limits established by law.
i. Environmental Sustainability: The contracts under this Act must be designed and
developed considering the required environmental standards and general regulations on
the subject.
Definitions: For the purposes of this Act, shall apply:
a) State Agencies and Entities: These are all public institutions defined as such in national law,
because of their legal status;
b) Of public-private partnership contract: contracts are contained in Part II of this Act under which
the Contracting Authorities involved with legal entities of private law in an investment project
related to the purpose of this law, through a contractual legal relationship long term commitments
with a distribution of risks and benefits between the parties;
c) Private Participant: Are private law legal persons participating in a public-private partnership
project.
d) Contracting Authority: Are State agencies and entities, as well as companies and partnerships
with state shareholding having the competence to enter into public-private partnerships;
f. Proponent of private enterprise: Is the ones who files an application of private initiative
pursuant to this Act; and,
g. Public Founders: Are State agencies, and entities that are involved in or trusts or trust funds to
develop public-private partnership projects.

TITLE II
PUBLIC PRIVATE PARTICIPATION AGREEMENTS

3rd - Scope . The contracts of public-private partnerships may include infrastructure and service
management , including road , rail, port , airport , waterway projects , dredging and maintaining
the navigability of rivers projects; the social infrastructure ; electrical infrastructure ; improvement
projects , equipment and urban development; water supply and sanitation; among other
investment projects in infrastructure and public utility services . They may also comprise the
production of goods and provision of services that are themselves the subject of agencies ,
organizations, companies and companies in which the State is party . The commitments of the
private participant will be established in the contract and shall include at least the total or partial
financing of investment and operation and maintenance of infrastructure and its associated
services, and any of the following:
a. the design and construction of infrastructure and the equipment if necessary, or b.
construction or repair and improvement of infrastructure and equipment that is necessary
or appropriate, c. in the case of public companies and corporations with state
participation, the management of the services of its object.

Only may be carried out under the regime of participation public-private laid down in this Act
projects in which investment expenditures exceed, in present value, equivalent to 12,500
(twelve thousand five hundred) minimum monthly salaries for various activities not specified
in the capital city of the Republic.

Article 4- Distribution of commitments, risks and benefits. The contracts of public-private
partnership must state expressly to specific situations the risks, benefits and commitments
that take respectively the state and the private participant.
Section 5 - Legal regime. The contracts of public-private participation shall be subject by the
terms and conditions of the contract, the provisions of this act and the regulations issued by
the executive and other statutory provisions as are applicable

Chapter II
Institutional Framework

Article 7 - Competent authorities. Contracting Authorities, within the scope of their respective
powers, shall develop projects through contracts of public-private participation under this Act.
Contracting Authorities may jointly develop projects of public-private partnership jointly; in
which case, hold the relevant agreements, contracts or agreements with this purpose,
according to the regulations.
The Ministry of Public Works and Communications (MOPC) shall be the competent public
entity for the development, selection, award and execution of public - private partnerships in
the field of transport and communication channels, including dredging and signaling rivers and
airports. In case of decentralized entities that have responsibilities related to those projects,
the Ministry of Public Works and Communications (MOPC) assume the powers necessary for
the conclusion of the contract and its performance, replacing such authorities in exercising
those powers. The decision to push a project through the arrangements provided for in this
law require the approval of the Executive, in accordance with the procedure established in the
regulations. Prior to this approval, assessment procedures provided for in this law and its
regulations are to be made.
Art. 8 - Atributions of the Contracting Authority: The Contracting Authority, under the
coordination of the Public-Private Partnership Project Unit created in the next article of this
law, will be responsible for structuring, selection, award and conclusion of the public-private
partnership, and the control of the proper execution and fulfillment of the obligations
assumed by the private participants. All that, without affecting the regulation and control
attributions that apply to other state agencies in accordance with their original powers and
which are conferred by this Act. To develop public-private participation projects, Contracting
Administrations should coordinate with the Public-Private Projects Unit, project structuring,
preparation of specifications and tender evaluation by the procedures and mechanisms
established in regulation. They may also instruct the Public-Private Partnership Project Unit
exercising the necessary powers for the execution and performance of contracts established
by this Act, by mandate or delegation agreements. The regulations determine the conditions
under which these agreements are governed. During the contract execution stage, the
Contracting Authorities must first notify the Private Public Participation Project Unit the
following acts:
a) Unilateral and mutual agreement modifications under Articles 32 and 33 of this law
contract;
b) Requests for compensation or compensation raised by the private participant for any
reason, including those provided in Article 34 of this law;
c) Sanctions the private participant;
d) Any suspension of the contract under Article 35 of this law
e) The early termination of the contract before the decision; and,
f) Any other circumstances provided for in the regulations of this law.
Art. 9- Public-Private Partnership Project Unit: Public-Private Partnership Project Unit is
created as a specialized agency of the Ministry of Planning. The organization of this division
will be established in the regulations of this Act and resources for implementation and
strengthening will be incorporated into the law of General Budget of the Nation.
The functions of the Public-Private Partnership Project Unit are:
a. Promote and coordinate with relevant authorities and public organisms the plans, policies
and standards for the development and functioning of the modalities of Public Private
Participation;
b. Coordinate and promote projects of public-private partnership with the Contracting
Authorities, and advise them about structuring , selection, award , execution and performance
of contracts for public-private partnerships ;
c. Identify opportunities and mechanisms to promote Public- Private Partnership between
contracting governments to provide public services or activities of general interest;
d. Promoting Public Private Participation Projects among investors and potential funders and
the community in general;
e. Develop general bidding terms and conditions and advise the Contracting Authorities in the
preparation of the individual sheets and the selection process of bidders;
f. Carrying the Public Registry of Project Public Private Participation and Private Initiatives ,
under the conditions defined by this law ;
g. Post on the website that defines the regulatory information related to projects, contracts
and their execution, according to the records that Contracting Administrations submits;
h. Maintain a broad public policy of information and accountability
i. Carry out other duties or responsibilities under the law or regulation assigned.
Art. 10- Ministry of Finance. The Ministry of Finance shall have the following functions in the
context of structuring and development projects carried out under contracts of public-private
partnerships:
a. Assess risk allocation and fiscal impacts under the study phase and preparation of draft
contracts for public-private partnerships
b. Give a prior opinion with binding projects of public -private participation, risk sharing and
fiscal impacts, and the feasibility of the implementation of projects;
c. Ensure consistency of fiscal firm and quantifiable contingent future payments of these
projects, subject to the terms of this Act;
d. Keeping track of the firm and quantifiable contingent future payments involving the
approval of each project;
e. Evaluate and report at each General Budget Law of the Nation, the total amount authorized
to transfer liquidity fund each year as a firm and quantifiable contingent future payments to
participants by way of private investment , according to existing contracts when it involves so ;
f. Check the Contracting Authority included in each bill of General Budget of the Nation
corresponding to the resources needed to meet the obligations arising from these projects
allocation, as the case;
g. Hire at least every four years an external audit firm and contingent liabilities of contracts
governed by this Act;
h. Hiring an international audit to assess the quality of services under public-private
participation, and raise the resulting report to the Presidency of the Republic;
i. Issue binding technical advice in the areas of their competence, based on the commitments
and fiscal risks for Financial Administration, about:
1) The bidding terms and conditions prior to approval;
2) The contracts and amendments prior to their subscription basis;
3) Claims for damages or compensation raised by the private participant for any reason;
4) The early termination of the contract before the decision; and,
5) Any other circumstance that might affect state resources.
j. All other powers provided by law.
The deadlines for issuing opinions will be established in the regulations.
Art 11. Guarantee Trust Fund Liquidity Contract and Public-Private Participation. A trust fund
and liquidity is created to accomplish the obligations derivated from of the firm, contingent
and measurable commitments that could force the state and the costs that correspond to the
resolution of disputes through the subscription of public-private participation contracts.
The trust will be financially administered by the Development Finance Agency's with a
separate fund of its own, under the provisions of Law No. 921/96 "Business Trust" and its
regulation. The State, acting as trustee, will act through the Ministry of Finance. The
regulations will establish the mechanisms for the implementation of this fund. The fund will
maintain a minimum percentage of 10% (ten percent) of cumulative quantifiable contingent
liabilities set out in Article 14 and 100% of the firm's liabilities next calendar year. The
regulations may provide different percentages of quantifiable guarantees contingent risks,
according to the particularities of each project.
The fund's resources will come from, among others:
a. A state contribution, which will be constituted with funds established in paragraph a, of
Article 3 of Law No. 4.758/12 "That creates the National Fund of Public and Development
(FONACIDE) Investment and Fund for Excellence in Education and Research, "not
committed to finance programs and projects running. This contribution will gradually
integrate up to a maximum of 25% (twenty percent) of FONACIDE resources for the
National Treasury received in the year of enactment of this Act.
b. A percentage of the contributions resulting from payments to private participants made to
the Contracting Authority under the terms of the contracts of public-private partnerships
as set out in each case, in accordance with Article 24, paragraph e) of this law; the
percentage to be allocated to this fund and liquidity will be defined in each case by the
Executive;
c. Contributions resulting from payments made to private participants to the Contracting
Authority under the terms of the contracts of public-private partnerships related to
surpluses of projects or as stated in each case;
d. Contributions other entities engaged.
e. Return obtained by the administration of the Fund
f. The fines levied on private players under the penalties provided in this Act, its regulations
and the respective contracts
In cases in which the Fund cant vouch for all of the liabilities, the Ministry of Finance will
implement the relevant legal and administrative mechanisms for each case.
Resources transferred to the fund under this law will not be returned to the Treasury, but
remain within the fund affected and will continue its objectives for the following fiscal years.
Payments to be made to the fund are governed by the Law No. 921/96 "Business Trust" and
not subject to the provisions of Law No. 1.535/99 "From Financial Administration of the State".
Payment schedules must be provided by the Ministry of Finance to transfer resources. This
trust will have the same tax treatment under the Trust Business Act and its regulations. The
Development Finance Agency, as trustee, will receive a fee for the administration assets of this
trust, which will be agreed with the trustee in the Indenture under the trust fund and in
accordance with the guidelines laid down in the respective regulations.
Art 12. - Percentage assigned to departmental and municipal governments. 2% (two percent)
of the payments established in Article 24, paragraph e) of this Act in cases that are specified in
the contracts, will be allocated to the departmental governments and municipalities affected
projects. For projects involving more than one municipality or Government this percentage
will be distributed in proportion to the areas concerned. These funds will be exclusively
applicable to infrastructure.
7% (seven percent) of funds established in subsection a) of Article 3 of Law No. 4.758/12 "That
creates the National Fund of Public and Development (FONACIDE) Investment and Fund for
Excellence education and Research ", could be spent on public-private partnership projects to
be developed in the capital of the Republic and its metropolitan area related to the purpose of
this law.
The distribution and deposit of revenue described above will be made by the Ministry of
Finance and in coordination with other technical agencies of the state, especially in bank
accounts by those authorized, without further formalities.
Art 13.- Public Registry of Projects of Public-Private Participation. The Public-Private Unit of
the Technical Secretariat of Planning will be responsible for keeping a public record of all
projects executed or been executed in the form of public-private partnerships, including
private initiatives. Registration shall be public and shall be guaranteed permanent access to its
information by electronic means.
Art. 14.- Fiscal Liabilities arising from public-private partnership contracts. The Ministry of
Finance shall issue the accounting rules for the assessment and registration of firm
commitments and contingent. Also, you must keep these commitments updated control. The
funds generated by the operation of the infrastructure or the provision of public services in
developing projects of public-private participation, wont be considered in the accounts
General Budget of the Nation, during the execution of the contract.
For the purposes of the provisions of this Article and the other references made in this regard
in the present law, "firm commitments" are considered the obligations of the State involving
the private participant to pay a fee for performing the acts referred in the contract, including
any amendments thereto; while "contingent commitments" to potential payment obligations
by the Contracting Authority and for the corresponding guarantees that the first granted to
improve the risk-return project participant and encourage private participation private. For
registration purposes, will be considered firm commitments and contingent quantifiable.
The Public-Private Participation Project Unit must submit an annual report to the Executive
and the Legislative detailing the Mechanisms and Measures Implemented for transparency in
each of the projects, and including the results and indicators for verification; This report will
be submitted Also to the Comptroller General's Office and published on the official website
determined on the regulation
Must be promulgated in the official Web site Referred to in the Preceding paragraph: a) Calls
specifications and invitations to bid, prequalification and any other selection procedure
provided In this Act, and Their Corresponding addendums; b) With the Corresponding Award
decisions bases; c) The contracts and Amendments; d) Decisions of early termination; and e)
Any other information indicating in the regulation.
Competent authorities will be responsible for providing the above information to the
administrator of the Web site in the form and deadlines established in the regulations.
Chapter III
Structure and processes
Art. 16.- Starting the process: The process leading to the signing of a contract for public-
private participation can be started automatically by the Contracting Authority itself or
originate in a private initiative under the provisions of Title IV of this Act.
Art. 17.- Previous evaluation. Prior to the initiation of the procurement character the
Contracting Authority shall have the technical, economic and legal analysis relevant. It shall
also to have the opinion of the Ministry of Planning (STP) and the favorable opinion of the
Ministry of Finance. The regulations shall establish the scope, form and content of previous
assessments, including, among others, the engineering, operational, commercial, economic,
financial, legal, environmental, and economic and social impact, as may be applicable to each
case. The Contracting Authority must prepare environmental and social assessment of value
for money of the project, in the form prescribed by the regulations.
Art. 18. - Eligibility for contracts with the Administration. Only may act in character Private
Participants of the Contracting Authority, national or foreign legal persons, who fulfill certain
basic conditions provided for this purpose in this law, its regulations, and the statement of
terms and conditions of each recruitment process.
Art. 19. - Incompatibilities. They may not be bidders or Private members:
a. The authorities and officials of the Paraguayan state , decentralized , self-governing or
binational entities , departmental governments and municipalities , with the same
relatives to the fourth degree of consanguinity or second degree , in the Contracting
Authorities ; and companies with which they are linked because of management
involvement or dependence ;
b. Those who have acted as consultants hired by the Public Administration Contracting in
project implementation which intend to participate as potential bidders , provided that
such participation may involve preferential treatment with respect to other potential
bidders ;
c. People with pending legal proceedings for breach of contract with the State, provincial
governments or municipalities, or who have been convicted of such cause within five years
prior to the call ;
d. Those who are in bankruptcy or for bankruptcy ; and ,
e. The tax debtors .
The persons specified in the foregoing grounds may act as members of a consortium bidder or
contractor or subcontractor of this, directly or through another entity controlled, linked or
form part of an economic unit with it. Also, the above prohibitions shall apply to those
individuals or entities for reasons of management participation or other circumstances, can
be presumed to be a continuation or derived by transformation, merger, transfer or
succession or otherwise, of those undertakings included in one or more of the grounds set
out above.
Art. 20.- Types of procurement procedures. The selection of the private participants shall be
by public tender procedures. Without limiting the foregoing, you may award contracts
through other competitive procedures to be regulated, provided that they are contrary to the
general principles of economy and efficiency, and transparency and equality. Competitive
procedures applied may provide additional or intermediate bodies such as prequalification
procedures involved or similar.
In any case may be submitted to the selection procedures of domestic and foreign persons
who meet the provisions of this Act, its regulations and the bidding terms and conditions.
Art. 21.- Prequalification of bidders. The Specification may consider prequalification of
bidders to select stakeholders who meet uniform and reasonable requirements, goals
established, which may concern only legal, financial or technical capacity, experience and
results in other works commissioned in the past. The list of prequalified shall be published on
the website of the Contracting Authority.
Art. 22.- Convocation. The invitation to stakeholders to participate in the competitive process
is conducted within the Contracting Authority determines, according to the characteristics of
the proposed public-private partnership that promotes. This period may not be, in any case,
less than sixty days prior to the receipt of bids. The call will take place with sufficient
advertising according to each case. For these purposes, the notice must be published at least
once in a newspaper of national circulation, and will be posted on the website of the National
Information System on Public Procurement.

Art. 23.- Evaluation of proposals. In the instance of evaluation of the proposals received, the
Contracting Authority together with the Private Public Project Unit Participation, and in
accordance with the stipulations of the Regulatory Decree, verify that they meet the
requirements established in the rules of the competitive process, and containing sufficient to
adequately assess the same elements. The evaluation criteria that are clear, measurable and
allow an objective and impartial evaluation of proposals will be used. They may, among
others, used systems involving the allocation of points to technical and financial bids,
determining the final score from the weight of those either, those determining a threshold
above which are considered accepted technical proposals, assessment of tenders is based on
economic or financial factors.

Art. 24.- Award and signing of contracts . The award shall be decided according to the
evaluation system defined by default in the statement scoring system , which must meet one
or more of the following factors : a. fees paid by users; b . remuneration for services rendered
to the State; c . term of the Contract; d . State contributions to the bidder to supplement
revenue from users; e . payments offered by the bidder to the Contracting State
Administration ; f . income guaranteed by the State; g . partial or total score obtained in the
technical grade ; h . rating of other useful and necessary additional services; i . Total revenue
for the contract , calculated in accordance with the provisions of the tender ; and j . other
objective factors defined in the regulation .

Art. 25.- Impugnations. Contrary to the decisions of qualification and prequalification, as well
as to react to the award, interested parties may deduct appeal before the Contracting
Authority within five working days from the date on which notice . To this end, and as a
condition of admissibility of actions claiming the appellant shall submit the guarantees
established by the challenged statement. In case of rejection of the challenge presented, such
warranties shall be implemented by the Administration.

Art. 26.- Guarantees maintenance of supply and contract compliance. Offerors shall provide
security of supply and maintenance requirements needed to apply to the procedures for
selecting private stakeholders convened by the Contracting Authority, and a guarantee of
contract performance as a necessary requirement to sign the respective public-participation
agreement private; as defined in each case by the Contracting Authority. Such guarantees
may become deposits, guarantees, bonds, letters of credit "stand by" and insurance policies
to be issued by an entity of the financial system duly authorized by the Central Bank of
Paraguay in the terms and conditions for such purposes set the regulatory bases and the
corresponding competitive procedures for creation, updating, rebuilding, replacement,
execution and withdrawal.

Art. 27.- Company specific object and trust. The bidder who has been awarded will remain
bound to constitute in the Republic of Paraguay, within the period specified in the statement,
a limited company with whom the contract of public-private participation is held. The project
awarded bidder will be the majority shareholder in the percentage set out in the regulations.
This company has the sole purpose determined by the specifications, in accordance with the
characteristics of the works or services procured items. It will last at least the duration of the
contract term, plus two years and should last as long as the warranty period of the works and
services performed. The company's shares will be nominative.
Alternative or in addition to the obligation to establish a company specific object, the
statement may make it obligatory that all resources are managed in the project will be
administered by a committee composed of all assets and liabilities, present and future trust
linked to project. The Contracting Authority will have the power to require information as it
deems necessary which will be directly delivered to the applicant by the trustee, at such times
and terms established in the contract. Yields of private resources in the trust belong to the
project. Formation of the trust, within three working days, the fiduciary must report to the
Ministry of Finance on behalf of the settlor and the beneficiary, the value of the managed
resources through the trust and any other required.

Chapter IV
General contractual arrangements
Art. 28.- Economic system of contracts for the development of projects of public - private
participation. The consideration of the private participant in each contract shall be
determined according to the type and characteristics of the proposed public-private
partnerships, can provide different forms of remuneration , such as granting of rights of user
fees , public contributions or other sources of income. Compensation mechanisms may be
related to the availability and service levels. Public input may include proceeds from
payments revenue, project financing guarantees, guarantees of minimum income collection,
tax exemptions provided for in the laws , contributions to the capitalization of special purpose
companies , loans , among others. The contract for the project development of public -private
participation, shall determine the conditions under which compliance such public
contributions are held, as well as those relating to any amendments or termination . The
resources generated by economic exploitation of the project are not considered expenditures
of public resources.
Public Contributions may include proceeds from payments revenue, project financing
guarantees, guarantees of minimum income collection, tax exemptions provided for in the
laws, contributions to the capitalization of special purpose companies, loans, among others.
The contract for the project development of public-private participation, shall determine the
conditions under which compliance such public contributions are held, as well as those
relating to any amendments or termination. The resources generated by economic
exploitation of the project are not considered expenditures of public resources.
Art. 29.- Assignment and subcontracting . The private participant may voluntarily relinquish
public-private partnership contract to a third party. The voluntary assignment , like the forced
cases arising from special guarantees execution , include the transfer of all rights and
obligations of the contract. The transfer can only be made to a legal person or group of them,
who qualifies and meets the requirements demanded bidder for the original contract, which
is not subject to disqualification under the law. The assignment will require the prior
authorization of the Contracting Authority to verify the effects of these extremes. The private
participant may also subcontract activities at the agency under the respective contract of
public -private participation, whether principal or accessory , related , or complementary to
those derived character. Subcontracting does not involve the release of responsibilities to the
private participant.

Art. 30.- Assets involved in the development of public-private participation projects . In the
development of these projects , under the circumstances of the case and the respective
contracts , the private participant may use different types of goods , namely :

a. property owned by the Contracting Authority or other public entities , existing or to be
created or supplied during the contract period , for which the Contracting Authority gives
the participant the right to private use , the latter being forced to revert to the
Administration to completion the contract; and , b . owned property , preceding the
signature of the contract or to be created , or provided during the term private
participant, and for which the Administration should transfer to or removed from the
project area at the end of the contract for public-private participation . In these cases, the
contractual instrument shall determine the form of transfer or retirement of assets, as
appropriate.
Art. 31.- Guarantees and insurance. The contract will specify the guarantees, insurance or bonds
that must constitute the Private Participant, in accordance with the Regulation.
Art. 32.- Unilateral modification of the contract for the development of projects of public-private
participation provided by the Administration. The Contracting Authority may unilaterally modify
the contract based public-private partnership for the public interest, duly supported by expert
advice. The changes made to the contract under this prerogative should be appropriate and
proportionate to the causes that motivate, but must endeavor to, where possible, respect the
nature of the contract and the economic and technical conditions contractually agreed. In such
cases, the Contracting Authority shall be required to rebalance the economic and financial
conditions of the contract of public-private participation, fully compensating the private
participant for damages that eventually appear to be the alteration of the equation. The
Regulations establish the maximum amount of investment that the private participant may be
required to make under the provisions of the preceding paragraph, and the maximum period
within which the Contracting Authority may order the modification project.
Art. 33.- Changes in hand. The Contracting Authority and the Private Participant may agree to
modify the characteristics of the works and contracted services, in order to increase service levels
and technical standards set out in the tender documents by signing the corresponding
supplementary agreement. The parties shall endeavor, where possible, respect the nature of the
contract and the economic and technical contractually agreed terms.
The Regulations establish the maximum amount of investment that the Contracting Authority and
the Private Participant may jointly agree, and the maximum period within which the project may
make changes.
Art. 34.- Compensation for supervening events. The Private Participant shall be entitled to obtain
restitution from the Contracting Authority, if verified the following types of events or
unpredictable and extraordinary to the signing of the public-private partnership made when
serious harm occasioned to the private participant and substantially alter the financial and
economic balance of the contract. a. unilateral public-private partnership modifications contract
arranged by the Contracting Authority, within the framework of its powers and authority in the
public interest amendments; according to the provisions of Article 32 of this law; b. fortuitous
events or force majeure, beyond the control of private and uncontrollable by this participant
provided the right to compensation for these events is expressly provided for in the contract; c.
acts of a particular nature of the state that produce direct effects on the contract for public-
private participation d. general acts of the state that produce direct effects on the contract of
public-private participation, provided that the right to compensation for these acts are expressly
provided in the contract; and, e. other events expressly provided in the contracts of public-private
partnerships that are not attributable to the private participant.
The compensation in these cases will take place after verification of the aforementioned serious
harm; and can be implemented through an extension of the contract term not exceeding ten
years, of the variation in investment regime initially planned changes in the tariff regime, subsidy
payments, among others, according to the scope, mechanisms and procedures under public-
private participation contracts.
Art. 35.- Suspension of the contract. The Contracting Authority may reasonably suspend the
contract: a. Accident or force majeure duly audited, in accordance with the terms of the tender
and the contract; and, b. for any other reason that the statement set.
As a consequence of suspension of the contract, the Private Participant shall have a period equal
to the period of delay or breakdown. Also, if so stipulated in the contract, can be claimed any
compensation under the terms defined in the contract. The suspension shall not exceed a period
of sixty days from the notification of the decision. This period may be extended once for a period
of equal length. The temporary suspension of the contract will not generate the Contracting
Authority established an additional responsibility in the contract.
Art. 36.- Termination of contract. The contracts of public-private participation shall be
extinguished for the following causes: a. By the expiration of the compliance period for its validity
or its extensions;
b. Unilaterally and early, for material breach of private participant of the Contracting
Authority in accordance with the provisions for the purpose in the contract of public-
private participation, determined by final act issued in accordance with the system of
dispute resolution provided in this Act;
c. By ransom provisions the Contracting Authority, for reasons of public interest, without
prejudice to any indemnity payments, under the terms provided in the respective
contract regulation and public-private partnerships;
d. By impossibility of performance of the contract of public-private partnership for the
Private Participant as a result of measures taken by the State;
e. By promoting respect Private Participant bankruptcy proceedings or bankruptcy;

f. On the occurrence of any cause that disables the Private Participant the effective
implementation of the provision;
g. By mutual agreement between the Employer and the Private Participant; and,

h. In other cases expressly provided in the contract of public-private participation.

Art. 37.- Termination for Serious breach of Private Participant. The declaration of serious
breaches of the obligations of the Private Participant shall be applied for, based on any of the
grounds set out in the respective contract, by the Contracting Authority at the instance of dispute
settlement under the contract.
The declaration of default shall render the warranties that are set out in the Act, its regulations,
the specifications and contract.

Art. 38.- Financing and special guarantee. The Private Participant may finance the development
of public-private partnership projects, across modalities, instruments and financial assets
recognized and regularly used in national or international financial markets. Will be able to
constitute for the benefit of its creditors and to ensure obligations directly related to the
development of his contract of public-private participation, a special guarantee consisting of a
pledge or creation of collateral trust in respect of rights arising from the contract of participation
public and private, including future cash flows generated by the project, and the shares of capital
stock of the company acting as private Participant. In case of default of the Private Participant to
its creditors holding such guarantees, they may run the same, out of judicial system, directly and
through mechanisms that have regulatory or contractually. Alternatively, holders of these special
guarantees creditors may ask the Contracting Authority to be appropriate, by this, the unilateral
termination of the public-private partnership for breach of Private Participant, in order to exercise
their rights in the context of the termination of that contract
Art. 39.- Situation of lenders holding special guarantees for early contract termination. Prior to
the early termination of the contract for the development of a proposed public-private
partnership arranged by the Contracting Authority for reasons attributable to the Private
Participant, those may offer to lenders holding such special guarantees option of continuity of
contract compliance in the above mentioned terms.
In such cases, the successor to the Private Participant, to be considered acceptable by the
Contracting Authority must certify to this compliance, meanwhile, timely requirements required of
bidders on the basis of the competitive procedure for the award of the contract public-private
participation.
Art 40 -. Attribution of jurisdiction in monitoring and sanctioning. The Contracting Authority shall
be the competent authority to monitor compliance with the obligations assumed by the Private
Participant, and the imposition of sanctions for non-compliance that, without prejudice to the
functions of regulatory agencies that have jurisdiction over the contracted service. Controls
exercised by the Administration will cover the technical, operational, legal, economic, financial,
and accounting issues, as provided in the rules and the contract. Management will have broad
powers of control and may use different instruments for the exercise of such functions such as
reporting requirements, audits, performance evaluation, inspections, surveys, and statements
Chapter V
Dispute settlement, users claims


Art. 41.- Settlement of disputes.

For the settlement of disputes arising by reason of the interpretation, implementation,
enforcement, development and / or termination of contracts of public-private participation and
that cannot be resolved by negotiation between the parties, the parties may submit their disputes
to arbitration of law, as they relate to issues of private law. To this end, the contract shall regulate
aspects: the corresponding procedural instances, to meet the requirements at each stage, the
integration of decision-making bodies where appropriate, and the effectiveness of decisions,
opinions and rulings issued promptly; without prejudice to the provisions issued by regulation.
Discrepancies of technical or economic nature arising between the parties during the execution of
the contract shall be subject to the consideration of a technical panel of experts in the field of
dispute, at the request of either party.
Art. 42.- Users claims. Each request by a user, concerning the provision of services pursuant to a
public-private partnership must be served by the Private Participant, resolving it in a reasoned
manner within a period of fifteen days from of submission. The Contracting Authority shall instruct
the Private Participant about the procedure and deadlines for the care, recording and response of
different complaints, requests and queries submitted by users, according to the rules that includes
the Regulations. In case of lack of timely or satisfactory by the Private Participant resolution, the
Contracting Authority shall deal with the users to submit claims against this, must rule on those,
without prejudice to the right of the user to perform the legal actions.

Art. 43.- Declaration of public utility.
Shall be declared of public utility and therefore subjected to the possibility of being expropriated
by law, those goods that are necessary for the execution of the contract for public-private
participation. The procedure, amount and how each of the parties concur to pay the same shall be
defined in the bidding documents and the contract, notwithstanding that these provisions also
provide in-law to authorize the expropriation.
Art. 44.- Easements. 1. The Participation Agreement grants the Public Private Private Participant
the right to establish easements on private property ownership of the State, municipalities or
individuals.
Easements shall be established by direct agreement between the Private Participant and the
owner held by public deed or by court order in the case that not fix direct negotiations with the
owner within sixty days from the date of the contract, in both cases must enroll in public records.
In terms of predial servitudes, the laws referred to in the Civil Code apply additionally. Two. Where
implementation of the works is indispensable modifying existing easements, Private Participant is
obliged to execute on its own, in the manner and deadlines established in the bidding documents
by the Contracting Authority.

TITLE III
TRUSTS AND TRUST ORDER FOR THE DEVELOPMENT OF PUBLIC INFRASTRUCTURE PROJECTS
AND SERVICES

Art. 45.- Legal authorization and legal status. For the development of projects of public -private
partnerships , agencies and State agencies may establish trusts or trust funds or participate in
those constituted or established with private law . Business trust constituted for the development
of projects of public -private partnerships are governed by the provisions of this law, Law No.
921/96 , " BUSINESS TRUST " , and the corresponding regulations. These trusts or trust funds have
the same tax treatment under the law and its regulations . Their operations in compliance with the
trust indenture in which state agencies and entities Founders are governed by rules fixed in the
trust deed and the rules of private law. However, without prejudice to the supervisory powers
conferred to the Central Bank of Paraguay in Law No. 921/96 , " BUSINESS TRUST " , the public
trustee shall be controlled by the Comptroller General of the Republic.

Art. 46.- Assets or rights may be subject to trusts or trust funds by public trustees . The property or
rights that may be held in trust by the state agencies and entities are :
a. The assets of the private domain of the State or the right of temporary use or exploitation
of these assets;
b. Revenues from taxes , fees, tolls , levies, including present and future flows , provided that
the proceeds of these revenues are allocated to the purposes for which they were created
or established ;
c. Taxes that have a specific target including current and future flows , provided that the
proceeds of these revenues are allocated to the purposes for which they were created or
established ;
d. Funds from external loans or local funding obtained by the agencies and institutions of the
State, provided that such funds are intended for the purposes set out in the relevant Loan
Agreement;
e. Resources from donations;
f. The proceeds of the bonds issued by the Treasury forming part of the Assets of the
Founders;
g. The resources coming from the so-called "royalties" and "Compensation due to the
flooded territory" of Itaipu Hydroelectric Dams and Yacyret, respectivelyas long as they
are destined to the intended objectives in the legislation establishing distribution; and,
h. Any other resource that is stipulated in the Annual General Budget Law of the Nation.
The public property shall be exempt trusts, unless they are disaffected. However, they
may be subject to contract trust funds that will not alter the legal nature of the good.
Art. 47.- Procedures and approvals.
1. Contracts trusts or trust funds shall be signed by the competent authorities of the Contracting
Authorities, with the assent of the Ministry of Finance.
2. The trustee will be selected through a process of public and competitive selection that will be
established in the regulations. When the trustee is public , may be selected directly. The
Development Finance Agency and the National Development Bank will act as trustees for the
purposes of this Act.
3. Authorizing the Ministry of Finance to transfer other complementary sources of funding to
Trusts constituted under this Act; provided that the trustee in question does not have sufficient
funding to fulfill the purposes of the trust agreements. The resources for this purpose shall be
provided by law established under the General Budget of the Nation.
4. Involvement of the property to be held in trust to the independent fund constituted by the
Trust, will be conducted under the rules established in Law No. 921/96 "Business Trust" and the
regulations issued by the Executive.
5. Resources for business trust constituting agencies and State agencies under the provisions of
this Act, shall be deposited in the Trust Account, and applied only to fulfill the purposes set out in
the trust made. The deposit of future revenue streams that are held in trust may be made directly
to the account without having to record the income in the public budget. 6. Trusts constituted
under this Act are authorized to perform emissions of securities (bonds) with fiduciary guarantees,
pursuant to Law No. 921/96, "Business Trust" and its regulations and in accordance with the
provisions in Article 9 of Law No. 1.284/98, Securities and regulations.

Art. 48.- Competence to handle private initiatives. The Public-Private Partnership Project Unit will
be entitled to receive, educate and substantiate private initiatives for the development of projects
initiated under this Act, including within their respective spheres of competence, provided that the
object is not similar to other than:

a. It has been submitted by a proponent and previous study is at the Contracting Authority;
b. the Contracting Authority was conducting preliminary studies for promotion into public
initiative;
c. the Contracting Authority would have identified and provided for in their planning and with the
express statement that will be promoted automatically by hand;

Projects that address financial payment or waiver of cash income of the Contracting Authorities,
whose present value exceeds, in both cases, ten percent (10%) of the initial investment will not be
accepted by private initiative. For the foregoing purposes, it is considered that a project is similar
to another when its order is fully or partially coincident with this (geographic area, public or
private property used, target and major activities), and its acceptance is incompatible or adversely
affect the development of the other project.
In case of submission of initiatives of similar projects, the processing of the presented firstly must
be prioritized. Projects which have been rejected under the provisions of this Chapter shall not be
reintroduced, both by the applicant that the project originated by third parties as well as by the
Contracting Authorities, within three years after its rejection.

Art. 49.- Process steps of private sector initiatives.
The processing of private initiatives includes the following steps:
1. Presentation: The proposer interested in developing its own initiative as part of a
proposed public-private partnership, will present their project to the Public-Private Project
Unit, accrediting technique, economic-financial and legal capacity to project development
in question. The proponent may be individual or be composed of more than one legal
entity. Its proposal should contain information relating to its identification as proposer;
project which aims to develop; feasibility and prefeasibility analyzed.
2. Assessment: The information received will be reviewed by the Public-Private Participation
Project Unit in coordination with the Contracting Authority, within sixty days, assess the
appropriateness of their acceptance, with or without modification, or rejection; all without
liability. This period may be extended. The acceptance will involve a favorable opinion,
declaring the public interest initiative.
3. Feasibility Study: Declared a public interest project, with or without modification, the
proponent shall prepare and submit the appropriate level of feasibility studies in
accordance with the requirements prescribed by the Project Unit Public-Private
Partnership with the Contracting Authority, within this set.
4. Public audience call to interested: Public-Participation ProjectsUnit have a period of one
hundred twenty days to analyze the information received and decide on the initiative or
request modifications. This period may be extended under the circumstances. The analysis
will be done in coordination with the Contracting Authority. If so ruling, the Contracting
Authority shall submit the initiative to the Executive Branch, and if this approval proceed
with the preparation of the statement, and conduct the competitive procurement process
for the provisions of this Act and the regulations. In these cases, the procedure will start to
award the project provided for private initiative in the same terms as it was passed
without possibility of incorporating new modifications; the same except that they be
accepted by the proposer.
Art. 50. Rights of the proponent. The proponent of a private enterprise shall enjoy the following
rights and preferences:
a. Obtain, once the final award of the contract, the reimbursement of costs associated with the
completion accepted previous studies referred to in this Act, if that does not lead contractor for
the project. These costs involve studies of the feasibility phase previously approved by the
contracting institution, and will be borne by the successful bidder, which should be reported in the
respective public appeal.
b. Get an award at the instance of competitive bids valuation procedure, involving a bonus of 3 to
10% (3 to 10 percent) of the score obtained with the offer, depending on the size and complexity
of the project on the terms that the regulation, which will be added to this to determine their final
score in that instance. Likewise, the promoter of the initiative will not pay the cost of acquisition of
the bases of the competitive process or related documents.

The Contracting Authority may choose to call prequalification and establish that feasibility studies
are financed by all prequalified, in which case the highest award presented by the initiative shall
not exceed 3% (three percent) of the score obtained with the offer. In this case, awarded each
prequalified shall reimburse the payment made by the feasibility studies.
If for any reason the proponent does not perform feasibility studies within the time limits
established by regulation, the Contracting Authority may be incurred by itself or hire in accordance
with procurement procedures that apply, that losing any right to receive compensation or no
benefit.
Art. 51. Confidentiality of private initiative. All information on private initiative submitted will
remain confidential until the declaration of public interest or rejection of the respective project.
The records relating to unsuccessful projects will be published on the website of the Contracting
Authority. Approved by the Contracting Authority, the initiative is transferred automatically to the
same. If the call is not made, the sponsor of the initiative will keep all the rights to it for a period of
three years.

TITLE V
FINAL AND TRANSITIONAL PROVISIONS

Art. 52. Contracting authorities authorizing structure, selection, award and celebrate the
respective contracts, the terms of this Act, the following projects:

1. Waterways, dredging, signaling and maintenance of the navigability of the Paraguay River
and other navigable rivers
2. International airports.
3. Construction, rehabilitation and maintenance of roads and highways
4. Construction, extension and service operation railways.
5. Construction and maintenance of national and international bridges.
6. Provision of safe water and sanitation and treatment
7. Generation, transmission, distribution and sale of electricity.
8. The road infrastructure of the capital of the Republic and its metropolitan area.
9. Social infrastructure; hospitals, health centers, schools.
10. Prisons.
11. Improvement, equipment and urban development in which the contracting authorities
involved.
12. Aqueducts, pipelines, oil pipelines.
13. Production of goods and services that are themselves the subject of companies and
companies in which the State is a party.
14. Production and marketing of cement.
15. Production, refining and marketing of hydrocarbons, fuels and lubricants.
16. Telecommunications services.
The Executive Branch is expressly empowered to determine and specify in detail the terms ,
contents, conditions and characteristics of the specific projects to be executed .

Art 53.- Regulation. Within one hundred twenty days of the enactment of this Act , the Executive
Branch will issue the Regulation of this Law , which shall be endorsed by the Ministry of Finance
and the Ministry of Public Works and Communications .

Art. 54 - . Effectiveness. This act shall take effect the day after publication, and shall apply to the
procurement procedures in the framework of projects initiated after that date.

Art. 55- Breach. The breach of this law by the responsible officials at the appropriate level of
public administration, will be considered as poor performance of their duties and penalties under
the relevant statutory provisions apply .

GIVEN IN THE CHAMBER OF THE HONORABLE SENATE OF THE NATION , THE TWENTY DAY OF
SEPTEMBER TWO THOUSAND THIRTEEN .