Tag Archives: commercial bank law

Impact of Article 43 of the Commercial Bank Law on PPP Projects 2016/3/29 14:41:10

With the widespread use of the PPP model in China, financing channels for PPP projects have also increasingly diversified.  Bank, trust, fund and insurance channels of capital have all rushed onto the stage of project financing. Subject to Article 43 of the Commercial Bank Law, banks, as the traditional big brother of financing, have always played the role of lender.  In practice, the opinions as to whether they can participate in the bidding on, and contributing capital to, PPP projects as private investors have been mixed.

A PPP project we recently advised on was called into question on a number of occasions because a commercial bank participated in the bidding as an investor and due to a difference of opinion among the parties on the understanding of Article 43 of the Commercial Bank Law. With respect to the project, the public party expressly stated in the bid invitation documents that “a bidder may be a consortium.

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