The land provision procedure law for the private public partnership projects implementation, approved by the St. Petersburg parliament

St. Petersburg Legislative Assembly deputies adopted a bill on the land provision, owned by the city in the concession agreements, public-private partnership agreements.

The bill implies the change of the land plots provision procedure to a concessionaire, private partner, including the procedure for the land plots rent amount determination.

The norm is aimed at the interaction improvement with the investors within the partnership with the city as well as provides a new rents calculation methodology for land plots.

«Such tools as a concession fee or private partner fee for the entire project duration should be available to finance private public partnership projects and concessions», Roman Golovanov, St. Petersburg Investment Committee chairman explained. «The minimum rental rate choice, proposed by the Committee, will provide a convenient long-term settlement mechanism for all agreement parties, which will significantly accelerate the investment projects implementation, important for the city».

A land lease agreement is signed with the concessionaire and private partner for the entire concession agreement duration or private public partnership agreement, according to the law. At the same time, the annual rent for the land usage by the concessionaire or private partner is 1.5% of the cadastral value, regardless of the agreement fulfilling stage.

The law entry into force will allow to more clearly structure the sections regarding the land rent amount, thereby reducing the possible risks of partners under such agreements, when signing the concession agreements in 2019.