Privatisation of Kosovo Telecom Privatisation Strategy and Roadmap

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Privatisation of Kosovo Telecom Privatisation Strategy and Roadmap The Government of Kosovo, Ministry for Economic Development and European Bank for Reconstruction and Development Privatisation of Kosovo Telecom Privatisation strategy and roadmap TERMS of REFERENCE Discussion draft December 2018 1. Background The European Bank for Reconstruction and Development (the ‘EBRD’) welcomes the decision of Government of Kosovo (the ‘Government’) to privatise JSC Post and Telecommunications of Kosovo (‘Kosovo Telecom’). EBRD and the Government agree that international experience suggests that —when successfully implemented— privatisation programmes can mobilise substantial investment and modernisation, and lead to significant gains in economic and management efficiency. At the same time, successful implementation of privatisation itself can be technically and operationally challenging. 2. EBRD support for the Government With the above in mind, the Government has requested that the EBRD fund an external consulting advisor (the’ Consultant’) to advise the Government on, and design a process for, the privatisation of Kosovo Telecom based on a broad range of international experiences. EBRD has agreed to fund such a Consultant and their terms of reference are set out herein. 3. Project objective The overall objective of the Consultant is to assist the Ministry of Economy and Development (“the Ministry”), which is charged with overseeing the privatisation of Kosovo Telecom, in designing and adopting a privatisation strategy and process based on the following principles: . Fair valuation: Firstly, the government should be adequately remunerated for selling its assets to private investors; . Commitment: Secondly, investors should possess the necessary expertise, resources and commitment to contribute to the development of Kosovo Telecom which they purchase or where they acquire substantial interest; . Transparency: Thirdly, the privatisation should be conducted in a transparent and orderly manner and ensure maximum clarity with respect to post-privatisation property rights; . Competition: Fourthly, encouraging competition throughout the privatisation process will help to ensure that the best available options are selected; . Utilisation of existing structures and processes: Finally, where possible, existing procedures and entities should be utilised to adopt and implement the recommended strategy and process, insofar as such are consistent with successful international experience. For the privatisation process to meet these broad criteria, the Consultant will work with the Ministry to develop a set of standards and procedures which will guide the privatisation, clearly define responsibilities of various agencies and officials involved and ensure effective coordination among them. 4. Consultant’s scope of work The Consultant will provide the Ministry with advice on an overall privatisation process for Kosovo Telecom including: the methods of privatisation, the broader legal and institutional framework as well as the timing and sequencing of the privatisation process itself. Specifically, the Consultant will consult and advise on: a) International experience in privatisation of telecommunications companies; b) Options for a methodology for privatisation of Kosovo Telecom, drawn from international experience relevant to Kosovo; c) An optimum methodology for privatisation in Kosovo; d) The design of a specific process for adoption and implementation of the selected methodology for privatisation of Kosovo Telecom; e) The necessary legal and regulatory framework for the selected process; f) The functional establishment of a Project Implementation Unit which will be tasked with advising on and implementing the privatisation; and, g) Design of an implementation plan for the privatisation of Kosovo Telecom; 5. Consultant’s tasks of work The Consultant will perform the following tasks: 5.1 The Consultant will review and briefly report upon existing strategies, laws, regulations, practices and other documents connected to privatisation in Kosovo. The Consultant will meet with relevant stakeholders to better understand current status, practices, relevant issues and priorities (Status review); 5.2 The Consultant will identify and report upon international experience in privatisation of telecommunications companies, looking at both positive and negative experiences and outcomes. The Consultant will examine a range of countries, detailing the process, relevant context and the shorter and longer- term outcomes of such privatisations. Examples from other countries of successful use of a particular methodological approach should be included where possible. This review will cover all relevant aspects of international experience including, but not limited to, legal, regulatory, fiscal, institutional, investment, labour and technical (International experience review); 5.3 Based on the conclusions of the status review and international experience, the Consultant will identify options for a methodology for adoption in Kosovo. In identifying options, the Consultant will list the pros and cons of adopting the various options in Kosovo (Options); 5.4 From the identified options the Consultant will make specific recommendations for a methodology for Kosovo. The recommendations should be clear, comprehensive and accompanied by a full explanation as to why that particular option is being recommended. A draft text of the methodology recommended and a strategy to adopt it will be included in output. The Consultant will be mindful of processes and instances of privatisations conducted previously in Kosovo, endeavouring, as far as possible to utilise existing structures where they have proven successful and are consistent with the known demands of privatisation in the telecom sector (Recommendation, draft methodology); 5.5 The Consultant will identify any specific changes that will need to be made to relevant laws and regulations to enable the adoption of the chosen methodology as a decision of Government and its onward implementation (Legal and regulatory adjustment); 5.6 The Consultant will identify the structure, composition and procedural approach for, and the actions necessary to achieve the functional establishment of a Project Implementation Unit (PIU). The PIU will be responsible for advising the Government and with the conduct of the overall privatisation process (Project Implementation Unit). While the Consultant will be responsible for advising on and helping to establish the PIU, the Government will be responsible for all costs related to its establishment, staffing and operation; 5.7 The Consultant will develop an implementation plan which will identify specific steps that need to be taken on a practical level to achieve effective implementation of the chosen methodology. The implementation plan will contain a workplan and timeline detailing all the specific steps to be taken, identifying responsible parties, risks, benefits and the expected outcome of the steps to be taken (Implementation plan); 5.8 The Consultant will agree the format and sequencing of presentation of project output during the inception period for the project. However, it is anticipated that output on status, best practice, options and recommendation will presented in a single report in the form of First Draft Report; followed by a presentation of a Final Draft Report which will include the material from the First Draft Report, together with the legal review, tender committee recommendations and implementation plan. Following that followed by the final combined report of all project output will be presented as a Final Report. 6. Project implementation 6.1 EBRD will be the executing party. The Ministry will be the beneficiary. The Consultant will perform all substantive work of the project lead implementation of tasks and preparation of documents, unless otherwise directed. The Consultant will report to the Operation Leader appointed by EBRD to oversee implementation of the project; 6.2 The Project will be implemented by a project working group (PWG) consisting of representatives of the Ministry, the Consultant and EBRD (as an observer). Other relevant stakeholders may be invited to participate from time to time as directed by the PWG. The chair and membership of the PWG will be agreed during the inception visit of the Consultant; 6.3 No deliverable will be considered as final and applicable for payment before being certified by the chairperson of the PWG as complete and approved by EBRD as being of an adequate quality; 6.4 The Ministry will appoint an agreed English-speaking liaison person to be responsible for administrative issues of the Project and the work of the PWG. The liaison person will be responsible for arranging PWG meetings and meetings/agendas for the Consultant’s visits, keeping and distributing documents, minutes, etc. and helping with general administration of the Project; 6.5 The output of the Project will be in English. The Ministry will be responsible for the cost of translation of any project documents; 6.6 The Consultant will visit Pristina at least twice, once at project inception once to preview their recommendations and again (optionally, where deemed necessary) to present the final output of the project. The Consultant will be generally available by phone or email during the course of the project to respond to PWG queries about project output or activities. 7. Contributions of the Ministry The Ministry will make the following available free of charge: . Appropriate official counterparts in all activities; . Access (or the facilitation
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