The Issuance of CONPES Document 4117 has been highly expected by the infrastructure sector in the country. Since over two years the National Government had been working on the drafting of this document that compiles the State’s contractual risk policy in infrastructure projects.

This new CONPES Document 4117 has the objective to compile all the contractual risk policy and to establish the specific dispositions for each sector of infrastructure. The above, considering that until now there were several different public policy documents issued, some of them in general terms (such as CONPES Document 3107) and some other is specific terms (such as CONPES Documents 3961, 4000 or 4028).

The Document commences by establishing the guidelines for administration in the risk management cycle in infrastructure projects. These guidelines, which are applicable to all infrastructure projects, consider that risk management does not limit to risk allocation alone, in fact, it comprises a whole cycle of six (6) phases including: identification, typification and allocation, qualitative evaluation, quantitative evaluation, implementation and management during the life of the contact.

Based on the above, the Document summarizes the general guidelines on risk management policy. These guidelines will orientate public entities and private parties in the risks that may be assumed in each contract; these are general guidelines, without prejudice to the specific dispositions that may apply depending on the sector or type of infrastructure, and additionally, the condensate the best international practices in risks management for infrastructure projects. It is important to consider that, although this Document sets forth the policy for infrastructure projects, private initiatives may propose different measures as long as they are more favorable for the public entity.

So, the Document provides for a general policy in the distribution and allocation of risks, such as, land acquisition, licensing and permits, social risk, design risk, construction risk, force majeure risks, liquidity and financing risks, among others.

Furthermore, CONPES 4117 sets forth the definition of a specific policy for each type of infrastructure project. On this subject, it is important to highlight that the general guidelines take precedence over the specific guidelines, but it aims to provide public entities with specific dispositions that consider the characteristics of each project and the context in which they are developed.

Accordingly, a risk criteria is set for projects which typically have had any sort of guidelines such as road projects, ports projects, airports projects or rail transportation projects. Nonetheless, in which is perhaps the most attractive characteristic of this Document, there are also dispositions regarding new types of infrastructure such as wastewater treatment plants, infrastructure for information and communication technologies, education infrastructure, power energy, justice (jails), public buildings, among others.

These dispositions make viable and feasible different projects in the country’s pipeline, such as the Canoas wastewater treatment plant, the Second Line of the Bogotá Metro or the reactivation of the rail transport nationally.

Lastly, CONPES Document 4117 establishes a transition regime for its application. Projects submitted for approval of contingent obligations valuation within the next six (6) months following the release of the document and those who have already been submitted may follow the policies already issued.

In summary, with the issuance of this public policy document, the country continues to move forward in the development of infrastructure, seeking to condensate the lessons learned and apply the best practices to get an efficient risk allocation and management for the different projects that improve the life quality of all citizens.