Executive Decree PCM-047-2016 establishing the balanced distribution of benefits and risks in Public-Private Partnership Contracts

This decree approves financing for the Governmental Civic Center project in Tegucigalpa, a public-private partnership between the State and a private company to build and operate a government office complex. The State allocates approximately 4.8 million dollars annually to pay rent, services, and project operations, benefiting public institutions by centralizing their offices with modern and efficient services.

That in accordance with Article 245 of the Constitution of the Republic, it corresponds to the Constitutional President of the Republic the General Administration of the State, being among other his attributions that of issuing Agreements, Decrees and issuing Regulations and Resolutions in accordance with the Law.

That in accordance with the legal provisions contained in the Organic Budget Law and the General Law of Administration of the Republic, it corresponds to the President of the Republic, through the Council of State Secretaries, to approve the budget of all institutions of the Executive Power, prior to its referral and approval by the National Congress.

That the Executive Power by means of Executive Decree PCM-062-2013 of December 19, 2013, published in the Official Gazette La Gaceta of December 26, 2013, approved the Trust Contract for the Administration of the Project "Governmental Civic Center" celebrated between the State of Honduras by means of COALIANZA and LAFISE Bank (Honduras), S.A., which also instructs the State Secretariat in the Ministry of Finance, to effect the necessary budgetary transfers to the Trust.

That the National Congress by means of Legislative Decree number 307-2013 of January 13, 2014, published in the Official Gazette La Gaceta of May 12, 2014, approved the Trust Contract for the Administration of the Project "Governmental Civic Center" celebrated between the State of Honduras by means of COALIANZA and LAFISE Bank (Honduras), S.A., ratifying and approving the instruction given by the Executive Power so that the institutions that adhere to the trust created carry out the budgetary reserves corresponding to the payment of building leases; so that the State Secretariat in the Ministry of Finance effects the transfers of financial resources, present and future, to finance the expenses of lease, public services, security, cleaning, maintenance and others, to the approved Trust.

That the attraction, promotion and protection of investment, national and foreign, in the Project denominated "Governmental Civic Center" celebrated between the State of Honduras, by means of COALIANZA and LAFISE Bank (Honduras), S.A., is of paramount interest for the State of Honduras, for which all facilities and guarantees should be granted to promote its development and execution; and the processes in the stages of execution, development and administration of public works and services must be regulated, enhancing the investment capacity of the project.

That due to the date on which Executive Decree PCM-001-2015 of January 5, 2015 was approved, by means of which in accordance with the stipulations of the Trust Contract signed with LAFISE Bank, the dependencies of the Executive Power that maintain offices in the municipality of the Central District and that will be part of the Project denominated "Governmental Civic Center" are designated, in accordance with the classification in the Financial Administration System (SIAFI) as well as the management of budget items and transfer to LAFISE.

That on February 23, 2015, the Government of the Republic of Honduras, acting through COALIANZA jointly with the Trustee, convened the International Public Tender for the Awarding of a Public-Private Alliance Contract for the Provision of Services and the Design, Financing, Demolition, Construction, Equipment, Operation, Exploitation and Maintenance of the Facilities, related to the Governmental Civic Center, in the municipality of the Central District of the Republic of Honduras.

That on February 1, 2016, as a result of the International Public Tender referred to in the preceding recital, the Contract for the Provision of Services and the Design, Financing, Demolition, Construction, Equipment, Operation, Exploitation and Maintenance of the Facilities, related to the Governmental Civic Center, in the municipality of the Central District of the Republic of Honduras was awarded to the Private Operating Investor GIA+A S. de C.V., and on April 20, 2016, the signing of said contract began between the Ministry of Finance, COALIANZA, the Trustee and the Private Operating Investor.

That in application of Article 32, 40 and 49 of the Law on the Promotion and Protection of Investments contained in Decree 51-2011 of May 3, 2011 and published in the Official Gazette La Gaceta of July 15, 2011 and its reforms, the investment project denominated "Governmental Civic Center" is declared of national and priority interest.

That the Law on the Promotion of Public-Private Partnership approved by means of Decree 143-2013, in its Article 3.- Principles, defines a) Legal security as a principle that recognizes the purpose of Law in public-private relations that arise as a product of this Law; and, g) Economic and financial sustainability of public-private participation projects.

That the awardee opted for the stapled financing offered in the Bidding Documents of the Tender, in order to protect the possible participation of the Social Security Institutes and other potential financiers participating therein.