Type Public Sector Role Private Sector Roles
Pure public Owns and operate port None (some services)
Landlord / Regulator Owns port and regulate private sector Operations
Greenfield concession (Build-operate-transfer) Negotiation with private companies, regulation Operations
Brownfield concession (Long-term lease of existing facilities) Negotiation with private companies, regulation Operations
Pure private None (regulation) Operations
Publicization Owns and operates port Operation and maintenance
Source: Adapted from Pagano, A.M, G.W.Y. Wang, O.S. Sanchez and R. Ungos (2013) "Impact of privatization on port efficiency and effectiveness: results from Panama and US ports", Maritime Policy & Management, Vol. 40, No. 2, pp. 100-115.
Forms of Port Privatization
The ownership and operation of ports usually fall into three categories, the first being a pure public port, the second is the landlord port model where the port authority concessions operations to the private sector and the third is the pure private port. There are however nuances (options) that can be added to these forms of port privatization:
  • Pure public. The public sector owns and operates the port. Although this model used to be prevalent, it has seen a decline with the concession of terminal operations to private firms. There are still a large number of ports in this situation (public port authority and public terminal operator), but the landlord model is becoming more prevalent. Some services such as pilotage, moorage and dredging can be contracted to private firms.
  • Landlord. The public sectors retains ownership of the real estate and several assets while private terminal operators, through concession agreements (port terminal privatization), lease a terminal facility and usually own the terminal equipment. Through a concession agreement, the port authority receive income with the concession is agreed and through an annual rent. In the case of large ports, several private terminal operators can be competing.
  • Greenfield concession. A form of port terminal privatization that concerns a new port project or a large terminal facility within an existing port where a terminal operator will finance, design, build and operate a new terminal for the duration of the concession. The landlord is usually the public port authority and at the end of the concession the terminal will revert back its control.
  • Brownfield concession. A form of port terminal privatization that involves existing facilities that are concessionned to a private operator. At the end of the concession, the terminal will revert back to the control of the port authority.
  • Pure private. The port is owned, operated and maintained by the private sector, with the public role limited to one of regulator. This is often the outcome of a privatization process.
  • Publicization. This process is the opposite of privatization where the public sector takes a stake (in whole or more often as a public-private partnership) in a port project that was entirely private. At the upmost, publicization could involve nationalization, but this is rarely the case.