Chapter 5 Supervision and Administration
Article 49
Where an infrastructure project participated in by the private institution is a public utilities enterprise, the private institution may, based on the following factors, set the fare rate and the schedule and method for fare adjustment in the financial plan submitted in its application:
1. Cost expenditures for planning, construction, operation and other financial matters;
2. Income derived from the operation and the ancillary enterprises;
3. Operation period;
4. Payment of royalty; and
5. Price index.
The fare rate and the schedule and method for fare adjustment as referred to in the preceding Paragraph shall, before the execution of the concession agreement by the authority in charge and the private institution, be approved by the relevant authority in charge of the public utilities concerned in accordance with applicable laws. Afterwards, the authority in charge shall have such approved fare rate and the schedule and method for fare adjustment included in the concession agreement and then announce the same in a public notice.
If after the operation of the infrastructure project hereunder, it is necessary to make any adjustment to the fare rate and/or the schedule and method for fare adjustment as approved under the preceding Paragraph, such an adjustment shall first be approved by the competent authority in charge of the public utilities in accordance with applicable laws. Afterwards, the authority in charge shall have the concession agreement modified accordingly and then announce the same in a public notice.
Article 50
For the infrastructure projects operated under this Act, the government shall not request the relevant private institutions to provide any favorable treatment for reduction of fare price unless otherwise permitted by applicable laws. Where any favorable treatment is provided due to the regulatory requirements under applicable laws, the authorities in charge of the relevant laws shall, unless otherwise specified in the concession agreement, appropriate respective budgets to subsidize the relevant private institutions.
Article 51
A private institution shall not transfer, lease out, or create any encumbrance on, the concession obtained under the concession agreement, nor shall it make such concession an object for enforcement in a civil action, unless the authority in charge declares that such an act is necessary for the improvement plan specified in Article 52 or the proper measures specified in Article 53.
Without the consent of the authority in charge, a private institution shall not transfer, lease out, or create any encumbrance on, any operating asset and/or equipment obtained from the building and/or the operation of an infrastructure.
Any transfer, lease, or creation of any encumbrance in violation of any of the preceding two Paragraphs shall be null and void.
Without the consent of the authority in charge, a private institution shall not proceed with any merger or spin-off.
Article 51-1
After a major infrastructure has been in operation for an entire year, the authority in charge shall evaluate the operating performance of the private institution concerned at least once each of the operation years.
For an infrastructure that is not a major infrastructure set forth in the preceding paragraph or has not been in operation for an entire year, performance of its operation shall be evaluated in accordance with the concession agreement.
If the authority in charge rates the operating performance of a private institution as “good,” the authority in charge may give the institution the priority to extend the concession agreement before the expiration of the operation period. Such priority shall be given only once, and the extension period shall not exceed the term of the original concession agreement.
The criteria for operating proficiency evaluation items under Paragraphs 1 and 2, the evaluation standards and procedures, and the method of giving good ratings shall be set forth in the concession agreement.
Article 51-2
Each year when the authority in charge conducts infrastructure projects in accordance with Article 9-1, the competent authority shall submit the implementation status and the performance thereof to the Legislative Yuan for recordation.
Article 52
If, during the building or operations of an infrastructure by a private institution, there is any serious schedule delay, material defects in the construction quality, poor operation, or other major events, the authority in charge shall take the following actions in accordance with the concession agreement, with a written notice to the private institution:
1. To order the private institution to make improvements within a given period.
2. To suspend part or all of the construction or operations if no improvement is achieved within the given period or if the improvement is ineffective, or allow a financial institution, a guarantor, or any other institution designated by the financial institution or the guarantor to temporarily take over the infrastructure project and continue the building and/or the operations thereof for a certain period.
3. To terminate the concession agreement if after a certain period following the suspension of the construction or operations or the temporary takeover by a financial institution, a guarantor, or any other institution designated by the financial institution or the guarantor under the preceding Subparagraphs, no improvement is achieved.
When taking actions in accordance with the preceding Paragraph, the authority in charge shall notify the financial institution, the guarantor, and the relevant government agencies of such actions.
After the concession agreement is terminated upon occurrence of any event specified in Subparagraph 3 of Paragraph 1 and the accounts are settled, the financial institution or the guarantor may, with the approval of the authority in charge, sign or designate another institution meeting legal requirements to sign a concession agreement with the authority in charge to continue the building or operations of the infrastructure.
Article 53
If, during the building or operations of an infrastructure, there are serious schedule delays, material defects in the building quality, poor operations, or other major events, and due to the pressing nature thereof, any failure to take immediate action may jeopardize major public interests or result in imminent danger, the central authority in charge of the relevant industries may order the private institution concerned to cease part or all of the construction or the operations of the infrastructure, with a notice to each of the government agencies concerned.
In the event of suspension of part or all of the operations of an infrastructure under Paragraph 1 of the preceding Article, or the cessation of part or all of the operations under the preceding Paragraph, or the termination of the concession agreement, the authority in charge may take steps at its discretion to maintain the operations of the infrastructure. If necessary, the authority in charge may compulsorily take over the operations of the infrastructure. The regulations governing the takeover methods, the scope, enforcement and termination of the takeover, and related matters shall be prescribed by the central authority in charge of the relevant industries.
Article 54
Where a private institution is required to transfer an infrastructure to the government upon expiration of the operation period, it shall have any and all existing operating assets or the operation concession transferred or reverted to the authority in charge with or without consideration in accordance with the concession agreement.