News / MegaProject 599: EOIs for Japanese toll roads concession in January 2016

MegaProject 599: EOIs for Japanese toll roads concession in January 2016

🕔 December 21, 2015
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The Aichi Prefectural Road Public Corporation (APRPC) has plans to launch a request for expressions of interest (RFEOI) for the concession to operate eight toll roads in the Aichi prefecture, in central Japan, in January 2016.

However, to get a private-sector business to operate the toll roads, ARRPC is trying to introduce an ad-hoc legislaton reform because Japan's Act on Special Measures concerning Road Construction and Improvement does not permit the operation of toll roads by private-sector business operators.

The winning bidder would be responsible for the operation, maintenance, collection of toll charges and traffic administration of the following eight roads:

  • Chitahantō Road, which has a total length of 20.9 km 
  • Minamichita Road, which has a total length of 19.6 km 
  • Chitaōdan Road, which has a total length of 8.5 km 
  • Chubu International Airport Connecting Road, which has a total length of 2.1 km 
  • Kinuura Tunnel, which has a total length of 1.7 km
  • Sanage Green Road, which has a total length of 13.1 km 
  • Kinuura-Toyota Road, which has a total length of 4.3 km 
  • Nagoya-Seto Road, which has a total length of 2.3 km

It is expected that APRPC will establish certain rules and grant incentives to the operating right holder with respect to net income and expenditure of operating activities, including increased revenues or cost savings.

The concession will end with the expiration of the toll collection period of each of the road licensed by the Minister of Land, Infrastructure, Transport and Tourism. The period varies from one road to another depending on when construction of the road is amortized by the Government.

The private sector will manage demand risk, road upgrade risk and O&M risk. The risk of force majeure and new competing road risk will be borne by the Government.

According to sources, the Aichi government wants to attract bids from groups comprising local and overseas investors.

The total revenue of the eight roads is approximately ¥17 billion (US$140.2 million) and none of the roads is making a loss.

Aichi Prefectures a prefecture of Japan located in the Chūbu region. It has a total area of 5,153.81 km2 and a population of approximately 7.5 million inhabitants.

We have recently reported on two airport concessions in Japan: Kansai and Osaka international airport concession and Sendai Airport concession.

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