Possibility of Arbitration in Turkish PPP Projects

Public Private Partnership ("PPP") is described as the collaboration of public and private sector entities, in order to provide public services that are traditionally provided by the state. PPPs are mostly used for the construction and operation of major infrastructure facilities (e.g. power plants, motorways and hospitals). The purpose of PPPs is to ensure the financing, design, implementation and operation of infrastructure facilities through the allocation of: (i) resources, (ii) risks, (iii) rewards, and (iv) responsibilities.

I. COMMON PPP MODELS IN TURKEY

1. Build – Operate – Transfer ("BOT")

The first PPP model introduced into Turkish legislation was the BOT model. BOT is a PPP model where a facility is built, financed and operated by the private sector. The constructed facility is transferred to the relevant public authority after the private entity's operation term. During the operation term, the revenues generated are used to repay a large part of the