Under Oman Vision 2040, the Sultanate is expanding the private sector's role in infrastructure and public services such as water, power, roads, education and health. The main legal tool is the Public-Private Partnership Law. This article explains it simply: what a PPP is, who is responsible, how projects are tendered and awarded, the key contract terms and what investors should watch.
What is a public-private partnership?
A long-term contract between a government entity and a private company, under which the private party usually finances, designs, builds, operates or maintains a public project in return for a revenue stream set by the contract, with risks shared according to who can best manage them.
The PPP Law 52/2019
The law was issued by Royal Decree 52/2019, published on 7 July 2019 and in force the next day; its executive regulations were issued by Decision 3/2020. It defines partnership projects as public works or public services of economic or social importance, or the improvement of existing services, that bring economic and social return and fit Oman's development plans.
The competent authority
The Public Authority for Privatisation and Partnership was abolished by Royal Decree 110/2020 and its functions, assets, rights and obligations transferred to the Ministry of Finance, which now handles PPPs.
Project stages
- Proposal and feasibility study.
- Tender, with qualification and bids under the tender documents.
- Evaluation and award, with a right to challenge under the set procedure.
- Formation of the project company.
- Signature, construction and operation under supervision.
- Expiry or termination, with project assets reverting to the Government.
Key contract terms
Term, payment mechanism, risk allocation (design, construction, demand, finance, change in law, force majeure), performance standards, termination and compensation, which are crucial because assets owned by the project company revert to the Government on expiry or early termination, and dispute resolution.
Frequently asked questions
Who is responsible for PPP projects in Oman?
The Ministry of Finance, following the abolition of the Public Authority for Privatisation and Partnership by Royal Decree 110/2020.
What is the difference between PPP and privatisation?
Privatisation transfers ownership of a state business to the private sector; in a PPP the project remains public in substance, the private partner delivers or operates it for a set term, and the assets then revert to the Government.
If you are preparing to bid for a partnership project or face a dispute under an existing contract, see our PPP lawyer service or contact Dr. Abdullah Al Rashdi Office on WhatsApp or +968 92000841.