Infrastructure Projects and PPP in Morocco: The Legal Framework for Foreign Contractors
The Legal Framework for Foreign Contractors
Morocco is in the midst of an unprecedented infrastructure cycle. The co-hosting of the 2030 FIFA World Cup (alongside Spain and Portugal), the expansion of the high-speed rail network, large-scale desalination programs, and the development of new deepwater ports are generating a multi-billion-dirham pipeline of projects open to international participation.
For foreign contractors, engineering firms, and investors, Morocco offers a structured and increasingly transparent legal environment. The Kingdom’s public-private partnership statute, modernized procurement rules, and adherence to international contract standards (including FIDIC) provide a recognizable framework—albeit one with mandatory local-law overlays that require careful navigation.
This guide summarizes the key legal instruments, contract structures, sector opportunities, and risk points that foreign participants should understand before entering the Moroccan infrastructure market. All references are to legislation in force as of September 2026.
1. Public-Private Partnerships: The Legal Architecture
The cornerstone statute is Law No. 86-12 on Public-Private Partnership Contracts (Dahir No. 1-14-192 of 24 December 2014), substantially amended by Law No. 46-18 (Dahir No. 1-20-26 of 11 June 2020). Together, they establish the legal architecture for PPP across Morocco.
Definition and Scope
Under Article 1 of Law 86-12, a PPP contract is a long-term agreement (generally exceeding five years) by which a public entity entrusts a private partner with overall responsibility for a mission encompassing design, financing, construction (or renovation), maintenance, and/or operation of infrastructure or a public service. Remuneration may come from the public entity, users, or a combination of both.
Law 46-18 broadened the scope significantly, extending PPP eligibility to collectivités territoriales (local authorities) and their groupings—not merely state-level entities. This opened municipal and regional infrastructure to the PPP model.
The National PPP Commission
Established under Article 3 of Law 86-12 and housed within the Ministry of Economy and Finance, the Commission Nationale du PPP issues opinions on PPP project proposals and evaluations, ensures compliance with evaluation methodology, and publishes guidance. Its approval is a prerequisite before any PPP award procedure is launched.
Preliminary Evaluation
Article 4 requires a prior evaluation (évaluation préalable) demonstrating the PPP model’s comparative advantage over conventional procurement—essentially a value-for-money test. This evaluation must be submitted to the National PPP Commission.
Unsolicited Proposals
Law 46-18 introduced Articles 7-1 through 7-6 of Law 86-12, creating a formal framework for unsolicited proposals (offres spontanées). A private partner may submit an unsolicited proposal to a public entity. If accepted in principle, the entity launches a competitive procedure. The original proponent may receive a bonus or right of preference in the competitive process—a meaningful advantage for firms with innovative project concepts.
Award Procedure and Duration
The primary award methods are competitive dialogue and restricted tender. A negotiated procedure is available in limited cases under Article 8. Contract duration typically ranges from 20 to 30 years and cannot exceed 50 years (Article 14 of Law 86-12). The private partner bears construction, financing, and operational risk; force majeure and hardship clauses are typically negotiated.
2. Public Procurement Under Decree 2-22-431
Morocco reformed its public procurement framework with Decree No. 2-22-431 of 8 March 2023, replacing the former Decree No. 2-12-349. The new decree modernizes procedures and reinforces transparency.
Tender Types
- Appel d’offres ouvert (open tender): the default and most common method (Article 16).
- Appel d’offres restreint (restricted tender): for works or services requiring special technical capabilities, limited to pre-qualified bidders (Article 17).
- Concours (design contest): for projects requiring technical, architectural, or aesthetic selection (Article 60).
- Procédure négociée (negotiated procedure): limited to cases of urgency, monopoly supplier, defense/security, or a failed prior tender (Articles 86–88).
- Bons de commande and marchés-cadre: for smaller or recurring procurement needs.
Foreign Bidder Eligibility
Foreign companies may bid on Moroccan public contracts. Article 25 requires non-resident bidders to submit documents legalized or apostilled and, where necessary, translated into Arabic or French. Foreign bidders must comply with the cahier des clauses administratives générales (CCAG). Depending on the project, association with a local partner may be expected or required.
National Preference
Article 155 of the Decree allows a preference margin of up to 15% in favor of Moroccan enterprises or consortia with majority Moroccan shareholding. This preference is applied during bid evaluation—it is not an eligibility bar, but it can be decisive in competitive tenders.
Guarantees
- Caution provisoire (bid guarantee): required at bid submission, typically 1–2% of the estimated contract value (Article 28).
- Caution définitive (performance guarantee): required within 30 days of contract notification, typically 3% of the contract amount (Article 29). Released after final acceptance (réception définitive).
- Retenue de garantie: a holdback of up to 7% on progress payments, which may be replaced by a bank guarantee.
Dispute Avenues
- Pre-contentious phase: complaints to the contracting authority or to the Commission des Marchés (procurement review commission).
- Administrative courts (tribunaux administratifs) have jurisdiction over public contract disputes.
- Arbitration is possible if expressly provided in the contract, subject to the requirement that state entities obtain prior authorization (Article 310 of the Code of Civil Procedure, as amended by Law 95-17 on arbitration and mediation).
3. Contract Forms and the Mandatory-Law Overlays
Marchés Publics vs. Concession vs. PPP Contract
- Marchés publics: governed by Decree 2-22-431. The state pays the contractor for works or services; risk remains largely with the public entity.
- Concession (délégation de service public): governed by Law 54-05. The private operator is remunerated through user fees and bears demand risk. Duration is capped at the useful life of the principal investments.
- PPP contract: governed by Law 86-12 as amended. A hybrid model combining construction, operation, and financing obligations. Remuneration may come from the state, users, or both. Longer duration and more complex risk allocation than either of the above.
Use of FIDIC Forms in Morocco
FIDIC contract forms (Red Book, Yellow Book, Silver Book) are commonly used on internationally financed infrastructure projects in Morocco, particularly those backed by multilateral development banks (AfDB, World Bank, EIB). However, FIDIC conditions are always subject to mandatory Moroccan law overlays, and practitioners must adapt them through Particular Conditions.
Mandatory-Law Overlays Modifying FIDIC
Decennial liability (responsabilité décennale). Under Articles 769–770 of the Dahir des Obligations et des Contrats (DOC), architects and contractors are jointly and severally liable for ten years from acceptance for total or partial collapse of a building or structure, or for defects threatening its solidity or fitness for purpose. This liability is of public order (d’ordre public) and cannot be contractually excluded or limited. It overrides any FIDIC defects liability period.
Subcontracting limits. Under the CCAG-Travaux, the main contractor must execute at least 50% of the works with its own resources unless specifically authorized otherwise. Subcontracting requires prior approval by the contracting authority. Unapproved subcontracting constitutes grounds for contract termination (résiliation).
Payment deadlines. Law No. 69-21 on payment terms (effective December 2023) imposes maximum payment terms of 60 days from invoice date for both private-sector and public-sector payments. Late payment triggers automatic interest penalties calculated at the Bank Al-Maghrib key rate plus a margin. For public contracts, Decree 2-22-431 also sets payment deadlines (typically 90 days for state entities, with late-payment interest under Article 147).
4. Key Infrastructure Sectors
Rail: ONCF Program and LGV Extension
Morocco’s Office National des Chemins de Fer (ONCF) is pursuing a major investment program. The first LGV (Ligne à Grande Vitesse) between Tangier and Casablanca—branded Al Boraq—has been operational since 2018. Extensions to Marrakech and eventually Agadir represent multi-billion-dirham opportunities. Contracts typically follow FIDIC-based models adapted to Moroccan procurement rules.
Water and Desalination
Morocco’s national water strategy addresses growing water stress through large-scale desalination. The Casablanca desalination plant, among the largest in Africa, is being tendered under PPP and concession frameworks. ONEE (Office National de l’Électricité et de l’Eau Potable) and regional authorities are the principal contracting entities.
Ports: Nador West Med and Dakhla Atlantique
Nador West Med is a major new deepwater port on the Mediterranean, managed by Nador West Med SA (a subsidiary of the Agence Nationale des Ports). Dakhla Atlantique is a strategic Atlantic port project in Morocco’s southern region. Both involve significant international contractor participation under Moroccan public procurement and PPP frameworks.
Stadiums and World Cup 2030 Infrastructure
As co-host of the 2030 FIFA World Cup, Morocco is undertaking the construction and renovation of multiple stadiums, training facilities, transportation links, and hospitality infrastructure. A dedicated government investment program is in place. These projects are expected to be tendered through accelerated public procurement and, in some cases, PPP structures.
Energy Transmission
Morocco’s Agence Marocaine pour l’Énergie Durable (MASEN) and ONEE manage large-scale energy projects, including solar (Noor Ouarzazate complex), wind farms, and interconnection infrastructure with Europe. Transmission projects involve international EPC contractors under adapted FIDIC frameworks.
5. Risk Points for Foreign Contractors
Exchange Control on Repatriation
Morocco maintains exchange controls administered by the Office des Changes. Foreign investors may repatriate dividends, profits, and capital freely, provided the initial investment was properly registered under the régime des investissements étrangers. Contractor payments and service fees require compliance with transfer procedures under the 2019 Instruction Générale des Opérations de Change (IGOC). In practice, transfers require bank intermediation and supporting documentation (contract, tax clearance, invoices).
Tax: Withholding Tax and Permanent Establishment
Withholding tax (WHT): Payments to non-resident contractors for services performed in Morocco are subject to WHT at 10% on gross fees for technical services (Article 15 of the Code Général des Impôts). Double tax treaties may reduce or eliminate WHT.
Permanent establishment (PE): A foreign contractor present in Morocco for more than six months (or 183 days under most treaties) on a construction site may create a PE, triggering corporate tax (impôt sur les sociétés) at a graduated scale up to 35% under the 2023 Finance Law reforms. Article 5 of the OECD Model Tax Convention, replicated in Morocco’s treaty network, is the reference.
Local Content Expectations
Moroccan law does not impose a formal local content quota for all infrastructure projects. However, the 15% national preference under Article 155 of Decree 2-22-431 creates a strong incentive to partner with Moroccan firms. Sector-specific regulations (e.g., renewable energy, automotive) may impose additional local integration requirements. Joint ventures with Moroccan contractors are common and often advisable.
Performance Security
Performance guarantees (caution définitive) are mandatory for public contracts. PPP projects typically require additional performance bonds, parent company guarantees, and step-in arrangements. International contractors should expect irrevocable, first-demand bank guarantee requirements compliant with Moroccan banking practice.
Termination and Step-In
Under both the CCAG and PPP contracts, the public authority retains a right of unilateral termination for public interest (résiliation pour motif d’intérêt général), with compensation. Termination for contractor fault follows a notice-and-cure procedure. In PPP contracts, step-in rights allow lenders or the public authority to intervene upon contractor default to ensure project continuity. These provisions are heavily negotiated and should be reviewed with particular care.
6. Practical Checklist Before Bidding
Before submitting a bid on a Moroccan infrastructure project, foreign contractors should verify the following:
- Eligibility and registration. Confirm registration requirements with the Office des Changes and the local trade registry (Registre du Commerce).
- Document legalization. Ensure all bid documents are legalized or apostilled and translated into Arabic or French as required by Article 25 of Decree 2-22-431.
- National preference impact. Assess the 15% preference margin under Article 155 and consider partnering with a Moroccan-majority consortium.
- Guarantees and bank facilities. Arrange provisional (1–2%) and definitive (3%) guarantees with a Moroccan-licensed bank or acceptable international institution.
- CCAG and special conditions. Review the applicable CCAG (Travaux, Services, or Fournitures) and the project’s cahier des prescriptions spéciales (CPS) in detail.
- Decennial liability exposure. Evaluate ten-year liability under Articles 769–770 DOC and secure appropriate decennial insurance coverage.
- Subcontracting structure. Ensure compliance with the 50% self-performance requirement; obtain prior approval for any subcontractors.
- Tax exposure analysis. Analyze WHT obligations (10% on technical services), PE risk (six-month threshold), and available treaty relief.
- Exchange control compliance. Plan for payment repatriation procedures under the IGOC, including required documentation and bank intermediation.
- Local counsel and JV partner. Engage Moroccan legal counsel early and consider a joint venture with a local contractor for operational and bid-evaluation advantages.
- Dispute resolution review. Verify whether the contract permits arbitration (and whether prior state authorization is required under Article 310 CPC) or defaults to administrative court jurisdiction.
- Sector-specific regulations. Check for additional regulatory requirements in the relevant sector (energy, water, transport, stadiums).
This guide is provided for general informational purposes and does not constitute legal advice. Moroccan infrastructure law is evolving rapidly, and project-specific analysis is essential. For tailored guidance, please contact our Infrastructure and Projects team.