UAE introduces new law to enhance public-private sector collaborations

The UAE has enacted Federal Decree-Law No. 12 of 2023, effective December 1, 2023, aimed at fortifying collaborations between the public and private sectors.

This law, which the Ministry of Finance issued, establishes a thorough framework for collaborations between federal government agencies and private businesses in the nation.

The primary objectives include regulating and promoting public-private partnerships (PPPs) to foster private sector engagement in strategic and developmental initiatives. The law is designed to enhance investment in federal government projects with social and economic significance, facilitate efficient project implementation, and leverage the private sector's financial acumen, technical expertise, and technological solutions.

Introduced to encourage private sector involvement in key projects, the law is expected to result in world-class services, improved public service quality, and heightened productivity. By fostering knowledge transfer from the private sector to federal entities, the legislation seeks to elevate the skills of the UAE's federal employees, preparing them to manage and operate projects effectively.

The law's provisions aim to expedite projects that deliver added value for public funds, minimize financial and operational risks borne by the government, transform infrastructure project management, and boost project competitiveness in local, regional, and global markets.

The law applies to partnership projects proposed by federal entities and funded, wholly or partially, by the private sector. Notably, it features exemptions for existing partnership contracts, provided they comply with specified criteria, and outlines exceptions for projects falling below specified value limits, public asset and service privatization, and certain national security-related contracts.

The law ensures continuity by referencing the implementation of existing resolutions until the issuance of the Partnership Projects Manual, maintaining flexibility and business continuity during the transition period. Overall, Federal Decree-Law No. 12 of 2023 underscores the UAE's commitment to fostering collaborations between the public and private sectors to drive economic growth and innovation.

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