TURKEY: BOT ruling deters thermal power bids

26 April 1996

A recent adverse ruling by the constitutional court on the legal status of build-operatetransfer (BOT) projects has deterred bidders for three large BOT thermal power schemes.

according to Energy Ministry officials. No bids have been returned for the Afsin-Elbistan B, Beysehir and Saray plants, which have a combined estimated cost of about $1,270 million.

Unless the ministry can get around the ruling, a fourth tender competition for the Tufanbeyli plant may meet with the same fate in August, according to industry sources. The government may decide on new legislation or a decree by early May, they add.

The constitutional court directed recently that BOT projects should be regarded as concessions rather than commercial contracts (MEED 23:2:96). Chiefly for foreign companies in BOT ventures, this would rule out access to international arbitration

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