LAHORE: The revised draft of the Management of Properties of Lahore Development Authority (Joint Venture) Regulations, 2021 has been finalised and is likely to be approved by the LDA’s governing body in the upcoming meeting.
According to a document, the section 5 of the Management and Transfer of Properties by Development Authorities Act 2014 (the Act) provides for management of property of development authorities through joint ventures. Similarly, the section 20 of the Act empowers the government to make rules for carrying out the purposes of the Act and Section 21 whereof authorises an Authority to make regulations.
Following this, the LDA (the Authority) proposed a draft of the Joint Venture Rules in its 12th/2019 meetings held on November 26 and 27, 2019 for consideration and approval of the government. An extensive consultative process initiated by the government culminated into coming into force of the Management and Transfer of Properties by Development Authorities (Joint Venture) Rules 2020 through a Notification published in the official Gazette on October 10, 2020.
“The LDA Director General constituted a committee headed by the Additional Director General (Urban Planning) to draft the Management of Properties of Lahore Development Authority (Joint Venture) Regulations. The Committee interacted with the concerned stakeholders and prepared a draft of the Regulations. The draft was got vetted from the Director Law (High Court & Supreme Court) and the Senior Legal Advisor, LDA. Thereafter, the vetted draft was published on the website of LDA to solicit objections, suggestions, amendments and recommendations from all stakeholders, academia, professionals and general public,” explains the document.
As a result of the aforesaid exercise, according to the document, the draft was revised finally that will be placed before an upcoming meeting of the LDA’s governing body for approval under its powers as narrated in the section 21 of the Act.
According to draft regulations, the DG may order preparation of a joint venture proposal or solicitation of joint venture proposal through advertisement in the press or negotiations with a government agency for a joint venture proposal or entertainment of an unsolicited proposal for management of property of LDA and may exercise all powers necessary therefore.
Under section 4 of the regulations, a committee has been constituted to deal with matters relating to joint ventures and perform such functions in respect of joint ventures as may be assigned to it by the DG. The members of the committee include Additional Director General (Housing), Chief Metropolitan Planner, Chief Town Planner, Director (Housing-X), Chief Engineer-I, Director (C&I), Director Finance and an officer to be nominated by the DG.
The Joint Ventures Committee may constitute its sub-committees or may require any of its member(s) to perform such functions on its behalf as it may direct. Subject to recommendations of the Joint Ventures Committee, the Director General shall exercise all powers of the authority in respect of the joint ventures. The committee may undertake or cause to be undertaken such studies, surveys, data collection, data analysis and take all measures to ensure due diligence as may be necessary for evaluation of a joint venture proposal and may incur expenditure therefore.
Without prejudice to generality of the sub-regulation (4), the committee may hire or authorise hiring of such professional, technical or other persons as may be deemed essential for a joint venture.
The regulations allow LDA to collaborate with a government agency for conceiving, planning and executing a joint venture without open competition on such terms and conditions as may mutually be agreed upon. The LDA may entertain an unsolicited proposal if it is accompanied by a feasibility study and the draft joint venture agreement.
The Joint Ventures Committee may undertake a comprehensive evaluation of an unsolicited proposal including but not limited to its technical feasibility, environmental viability, financial health and legal correctness. It may reject an unsolicited proposal, recommend it for approval to the DG with or without modifications or may require the private party to submit such information, record or other material as the committee may deem necessary to arrive at a final conclusion with regard to the unsolicited proposal.
In case of approval of an unsolicited proposal, the private party submitting the proposal shall be deemed to have been pre-qualified for participation in the bidding process. The private party submitting the unsolicited proposal shall be given five per cent extra marks in evaluation of its technical proposal.
The private party submitting the unsolicited proposal shall have a right to match the best offer received in competitive bidding. The committee shall determine the reasonable cost payable by the successful bidder to the private party who submitted the unsolicited proposal, manner and time of reimbursement and for matters connected therewith or ancillary thereto. To be a citizen of Pakistan or a natural or legal person resident in Pakistan is not a condition-precedent for submission of an unsolicited proposal.
Under section 7, a joint venture agreement may contain all details regarding all matters reasonably related to a joint venture. The Director, Law (High Court & Supreme Court) shall vet the joint venture agreements.
The section 8 allows DG and a partner to have a special purpose vehicle for a joint venture project. The DG and a partner may transfer property and other assets to an SPV on such terms and conditions as may be mutually agreed upon. The DG may allow transfer of funds to an SPV or to a partner in accordance with the joint venture agreement before the completion of the work, delivery of the goods or rendering of the services for which the funds are meant if it is certified to be inevitable and in public interest and necessary steps to protect LDA from any loss which may ensue advance transfer of funds are taken.
Published in Dawn, April 4th, 2022
