Volume 12 - Issue 70
/ October 2023
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http:// www.amazoniainvestiga.info ISSN 2322- 6307
DOI: https://doi.org/10.34069/AI/2023.70.10.4
How to Cite:
Soroka, L., Danylenko, A., Sokiran, M., Levchenko, D., & Zubko, O. (2023). Public-private collaboration for national security:
challenges and opportunities. Amazonia Investiga, 12(70), 43-50. https://doi.org/10.34069/AI/2023.70.10.4
Public-private collaboration for national security: challenges and
opportunities
Співпраця державно-приватного сектору для національної безпеки: виклики та
можливості
Received: August 20, 2023 Accepted: September 29, 2023
Written by:
Larysa Soroka1
https://orcid.org/0000-0002-6979-6049
Anna Danylenko2
https://orcid.org/0000-0001-8263-1364
Maksym Sokiran3
https://orcid.org/0000-0002-1682-2012
Diana Levchenko4
https://orcid.org/0000-0001-8343-2260
Oksana Zubko5
https://orcid.org/0000-0003-4682-6468
Abstract
The purpose of the article is to study public-private
collaboration as the main tool to guarantee national
security and the sustainability of the State. Research
results. The article examines the content,
characteristics, and development prospects of
public-private collaboration. The system of legal
instruments of Ukraine regulating this issue is
analyzed. The principles of implementation of the
public-private partnership are characterized, as well
as the key requirements for its effectiveness. It is
summarized that the public-private partnership in
the field of national security and defense is a form
of cooperation that must guarantee the effectiveness
of the implementation of protection and defense
measures in the form chosen by the parties in the
relevant contracts or agreements. Practical
implementation. Public-private collaboration has
been used to: build military infrastructure; develop
new defense technologies; train military personnel
Value/originality. To improve administrative and
legal regulation of the public-private partnership,
we propose to perform its full transition to online
procedures, as it will facilitate the access to
information and resources for private companies.
1
Doctor of Law, Professor, Scientific Institute of Public Law (Kyiv, Ukraine).
2
Ph.D. in Law, Analysis Center of Air and Space Law (Kyiv, Ukraine).
3
Ph.D. in Law, Lawyer, Scientific and Research Institute of Public Law (Kyiv, Ukraine).
4
Ph.D. in Law, Researcher, Analysis Center of Air and Space Law (Kyiv, Ukraine).
5
Ph.D. in Law, Senior Researcher, Scientific and Research Institute of Public Law (Kyiv, Ukraine).
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Keywords: public sector, public-private
partnership, national security, defense, military-
industrial complex, private sector.
Introduction
Recently, there has been an increasing focus on
relationships between the State and civil society,
which is based on updated principles. We agree
with the view of those authors who note that a
feature of modern management practice is
building relationship between the State, civil
society and business based on the principles of
partnership, effective interaction, transparency
and decentralization of public administration.
The civil society institutes and business
structures are allowed to express more than just
their views on certain socially significant issues,
but directly participate in the development and
adoption of management decisions (Soroka
2020; Danylenko, 2019; Sokyran, 2020).
The rules of state aid work for the
implementation of public-private partnership
projects and require the State, as a partner, to
comply with the conditions for the transfer of
budgetary resources to private partners to avoid a
ban on the public contracts due to the
incompatibility of the State aid with economic
competition. As an example, we can name the
Plan for the Reconstruction of Ukraine (National
Reconstruction Council, 2022), which was drawn
up by the Ministry of Economy with a recovery
price of $750 billion in budget funds. The
implementation of the Plan started with the
signing of the Memorandum of Understanding
with the International Finance Corporation
(IFC), which will help our country to rebuild its
transport, logistics, urban, social and energy
infrastructure. One of the rather optimistic
sections of the memorandum is to attract private
investors to the reconstruction of Ukraine’s
infrastructure within public-private partnerships
and concessions.
Therefore, the relevance of the research lies in
the fact that progressive development of the
economy, increasing social responsibility of
business have become prerequisites for the
introduction of public-private partnership as a
new legal form of market interaction. It is aimed
at ensuring the balance of socio-economic
interests of various layers of society and the real
participation of social partners in the
development and implementation of socio-
economic policy within the legal forms
established by the State through equitable, rule-
based cooperation (Aparov & Yatsenko, 2015).
Consequently, the purpose of the article is to
study the public-private partnership from the
discourse of its understanding as the main tool
for ensuring national security and stability of the
State. The results of the conducted research are
expected to intensify the implementation of
public-private partnership in the military sphere
to increase the level of national security and
defense of Ukraine. To improve its
administrative and legal regulation, a full
transition to online procedures should be carried
out.
Methodology
The research is based on the thorough study of
phenomena and their characteristic features,
which is ensured by the combined use and
application of the rules and principles developed
by methodological science. The following
methods of scientific knowledge were used to
achieve the goal of the research: general
philosophical, general scientific and special
scientific.
The method of legal hermeneutics was applied
during the analysis of the provisions of the
current legislation, regulating general and
specific principles of public-private partnership
implementation in Ukraine.
Monographic method was helpful when
analyzing the research by scientist, who
considered the issue under study.
With the assistance of logical method the
scientific basis for the article was examined and
applied.
Soroka, L., Danylenko, A., Sokiran, M., Levchenko, D., Zubko, O. / Volume 12 - Issue 70: 43-50 / October, 2023
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The use of methods of abstraction, analysis and
synthesis contributed to distinguishing the
features of public-private partnership in the field
of national security.
The methods of induction and deduction served
as tools for summarizing the obtained results.
State-legal modeling method helped to identify
the ways of optimizing administrative and legal
regulation of public-private partnership in
Ukraine and the method of generalization was
applied to draw the relevant conclusions.
Literature Review
The issue of public-private partnership was
highlighted by many scientists. Thus, Yu. Zuieva
(2023), having analyzed foreign cases of public-
private partnership, states that international
experience indicates high efficiency of
partnership relations between the State and
private sector, as well as the expediency of
attracting external investment resources during
the implementation of complex large-scale
projects in various fields. The author comes to
the conclusion that cooperation between the State
and private investors in the social sphere
(medicine, education), transport sphere
(motorways, ports, railway transport) and energy
sector (construction of power plants, facilities
management) is the most in demand at the
present stage.
Aparov and A. Yatsenko (2015), also emphasize
that public-private partnership is an important
tool on the way to the restoration and
modernization of the national economy, solving
important socio-economic problems by
combining and using the resources of the public
and private sectors. Unlike former author, the
scientists believe that the scope of public-private
partnership is much broader and cite the
following: search, exploration of mineral
deposits and their extraction, production,
transportation and supply of heat and electricity,
distribution and supply of natural gas,
construction and operation of transport
infrastructure facilities, mechanical engineering,
collection, purification and distribution of water,
security health, tourism, waste management, real
estate management, etc.
A rather interesting work is the study by
Brailovskyi (2014), who investigated the history
of public-private partnership and analyzed the
current state of its development in Ukraine,
highlighting further prospects. However, the
author is a representative of economic science, so
the emphasis was precisely on the economic
components of the use of public-private
partnership in Ukraine.
Speaking about the use of public-private
partnership in the context of national security,
only few scientists have studied this aspect. As
an example, we can name O. Pronevych and
S. Pronevych (2015), who believe that a
promising direction for the use of public-private
partnership in the field of security is the creation
of the necessary institutional and legal
foundations for the provision of services in the
field of private detective (investigative)
activities.
Mekh, Horobets and Holovko (2022) focused
their attention on the main principles and forms
of public-private partnership in the security
sector, while pointing out that national security
reflects the state of protection of the democratic
constitutional system and national interests of
Ukraine, therefore it is achieved due to the
sustainable development of the national
economy, integration into the European
economic space, the development of human
capital of Ukraine (through the modernization of
education and science, health care, culture, social
protection, ensuring environmental safety,
creating safe conditions for human life),
strengthening the capabilities of the national
cyber security system by using various tools of
influence (including public-private partnership).
Since the public-private partnership in the
security and defense area has been working
relatively recently, the phenomenon from a
management perspective requires research and
analysis, development of approaches to
management, taking into account the specifics of
the industry, systematization of knowledge and
research of world experience. Access of non-
State legal entities to the defense and industrial
complex effectively puts them on the global
market. Accordingly, it involves them in the
global competition in this area and the "race of
innovations" in the market of defense and
security goods and services (Kravchenko &
Prudkyi, 2023).
The analysts of the National Institute of Strategic
Studies, examining the public and private sectors
regarding their ability to protect national
security, come to the conclusion that there is now
a fundamental shift from cooperation between
these actors to paternity (Markieieva &
Rozvadovskyi, 2021).
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The majority of Ukrainian experts note that there
are currently a number of specific activities
outside the legal field of public-private
partnership: security, detective work,
intelligence, military consulting, law
enforcement, counter-intelligence, anti-terrorist
activities, etc. At the same time, the security
circumstances in Ukraine require an urgent
change in the political and legal conditions in this
area.
For example, the activities of private military
companies that could provide a wide range of
security services have not yet been legally
regulated. At the same time, the relevant laws of
Ukraine Law No. 959-XII "On foreign economic
activities" (Article 4), Law No. 549-IV "On the
State Control over International Transfers of
Military and Dual-Use Commodities" (Par. 17,
Article 1), Law No. 2642-VIII "On mine
countermeasures in Ukraine" (Article 36) allow
foreign economic entities to зrovide a range of
commercial services, which include a significant
proportion of those offered by private military
companies.
Results and Discussion
Since cooperation between the State and the
private sector first appeared in the practice of
foreign countries, there are disagreements in the
domestic literature on the translation of the term
"public-private partnership". As for the CIS
countries, this concept is interpreted as "public-
private partnership" or "State-private
partnership". Such differences in translation are
due to the fact that the word "public" in foreign
countries is usually understood more broadly
than "State". English-Russian Muller’s
dictionary (2023) provides the following
synonyms to interpret the definition of "public":
State; national, universal; generally available;
communal; open, vowel.
The professional online dictionary Multitran
(2023) proposes the next analogues to this term:
communal; open; vowel; national; nationwide;
State; public law; universal. It should be
understood that in the English language there is
no difference between the words "state" and
"public"; both of these concepts are expressed by
the term "public", which is indicative, because
the State is not only officials and politicians; the
State and power is society, which affects the
processes taking place in the country.
Thus, public-private partnership is a form of
cooperation between the public sector
(institutions and authorities) and the private
sector (enterprises and companies), in which both
parties jointly direct efforts and resources to
solve certain tasks or provide certain services.
This may include implementation of
infrastructure projects, provision of social
services, property management, etc.
Public-private partnership in the sphere of
human, society and state security is a complex
socio-legal problem. The strategic direction of
law-making activity in Ukraine is also the
creation of institutional and legal foundations for
the establishment of public-private partnership in
the field of prevention, response, and
minimization of the consequences of man-made,
natural and socio-political emergencies
(Danylenko, 2019).
The first legal act in which a legal definition of
public-private partnership was provided at the
legislative level is the Law of Ukraine
No. 2404-VI (2010). It was adopted to determine
the organizational and legal basis of interaction
between State and private partners and is
currently the source of the main principles of its
implementation.
Undoubtedly, any interaction should be based on
certain principles as rules of conduct for all
parties of partnership.
Let’s clarify that in legal doctrine, principles are
general, guiding (basic, main, starting, initial
theoretical, general normative, directing)
provisions (Sokyran, 2020, p. 41). For the sphere
of public-private partnership, the following
concepts are established:
1) equality of public and private partners before
the law;
2) prohibition of any discrimination against the
rights of public or private partners;
coordination of the interests of public and
private partners for the purpose of mutual
benefit;
3) ensuring higher efficiency of activity than in
the case of implementation of such activity
by a public partner without involving private
partner; continuity throughout the period of
the contract concluded within public-private
partnership, the purpose and form of
ownership of objects in the State or
communal ownership or belonging to the
Autonomous Republic of Crimea,
transferred to a private partner;
4) recognizing rights and obligations provided
for by the legislation of Ukraine and
determined by the terms of the contract
concluded within the framework of the state-
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private partnership by the public and private
partners;
5) fair distribution of risks associated with the
performance of contracts concluded within
public-private partnership between public
and private partners;
6) determining private partner on a competitive
basis, except for cases established by law
(Soroka, 2020).
Summarizing the principles listed above, we get
the following basic rules for its implementation:
equality before the law, non-discrimination,
efficiency, compliance with legislation and
contract terms, fair distribution of risks,
competitiveness.
However, it should be noted that researchers
define other principles of public-private
partnership in the scientific literature. Such
principles are not fixed at the legislative level,
but they are still important for clarifying the
essence of public-private partnership. Thus, the
authors single out the following principles of
implementation of public-private partnership:
1) the principle of efficiency of budget
expenditures;
2) the principle of public interests priority;
3) the imperative principle of social relevance
of the State’s economic policy;
4) the principle of business social
responsibility;
5) the principle of the public nature of social
relations management;
6) the principle of information transparency;
7) the principle of ensuring State control.
We agree that it is not possible to define all
principles at the legislative level, so they can be
specified when concluding a public-private
partnership agreement, but some of them are
extremely important. After all, as practice
(including international one) indicates that the
parties do not always adhere to the established
principles, which does not have the effect for
which the partnership was established.
For example, in 2018, the European Court of
Auditors (2018) in its report "Public Private
Partnerships in the EU: Widespread
shortcomings and limited benefits" stated that
despite the potential of this partnership to achieve
faster policy implementation and ensure proper
service standards, audited projects are not always
were effectively managed and did not provide
adequate value for money. The potential benefits
of public-private partnerships were often not
realized as they have been delayed, increased and
underutilized, resulting in inefficient spending.
The authors of the report determined that, in
addition to bureaucratic delays, the final result
was also affected by the lack of proper analysis
of strategic approaches to the use of public-
private partnerships and the institutional and
legal framework.
Thus, in deciding whether to transfer a national
security project to partners from the private
sector, the public sector should find out if this
decision maximizes the value for money, as well
as whether it protects public interests (in the
context of equal conditions between public-
private partnerships and traditional purchases).
In addition to the above, a public-private
partnership should include:
1) sharing of risks and responsibilities, where
both parties, the public and private sectors,
share the risks and responsibilities
associated with the implementation of the
project or services provision;
2) financial transparency (to comply with it, it
is necessary to conclude a detailed
agreement on financing and management of
funds, which will ensure not only
transparency, but also effective use of
resources);
3) innovation (the private sector can bring
technical know-how and innovation, thereby
ensuring a more effective solution to
problems);
4) duration, because such partnerships usually
involve a long period of cooperation, which
ensures stability and long-term benefits for
both parties;
5) socio-economic impact (public-private
partnerships can contribute to socio-
economic development, in particular, by
creating new jobs, improving the quality of
services and developing infrastructure).
Since public-private partnership is used in many
areas, however, specifically in the field of
national security and defense, its priority is rarely
overlooked (there is no mention of it in the Law
of Ukraine "On Public-Private Partnership" (Law
of Ukraine No. 2404-VI, 2010).
However, this Law defines: “…by the decision of
the state partner, the public-private partnership
can be applied in other spheres of activity,
providing socially significant services, except for
the types of economic activity that, according to
the law, are allowed to be carried out exclusively
by State enterprises, institutions and
organizations". Since national security is always
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a socially significant area, it is logical to assume
that the provision of services within its borders is
a socially significant process”.
Thus, the legislator indirectly allows the
implementation of public-private partnership
projects in the security and defense area.
However, there are currently a number of
specific activities outside the legal field of
public-private partnership: security, detective
work, intelligence, military consulting, law
enforcement, counterintelligence, anti-terrorist
activities, etc. At the same time, the security
conditions in which is Ukraine now, require an
urgent change in the political and legal
circumstances in these areas (Markieieva &
Rozvadovskyi, 2021, p. 11).
With the beginning of the full-scale invasion of
the Russian Federation on the territory of
Ukraine, there was a big problem with the lack of
weapons, including drones. At the same time, it
gave impetus to the formation of new private
enterprises, which not only meet the linear needs
of the security and defense sectors, but also
create innovative high-precision products.
More than 200 companies producing drones of
various types are already operating in Ukraine.
Thanks to State programs and charitable funds,
most of the contracted drones were manufactured
in Ukraine – "Kazhan", R-18, "Vampir",
Punisher and others (Honcharova &
Danishevska, 2023). Many more both the name
and the development itself remain classified.
Startups in this field can be conventionally
divided into two groups:
hardware, for example, drones, anti-drone guns,
tactical headphones, communication systems,
etc.;
software: battlefield management systems,
gunnery software, training modules, cyber
security systems, and more (Soroka, 2022;
Kravchenko & Prudkyi, 2023).
One of the few examples of cooperation between
public and private partners in the field of national
security is the Airlogix official website (2023)
project, whose team first developed and created
reconnaissance drones "Gor" for ground troops.
Thanks to State programs, the initiative of the
Ministry of Digital Transformation and the
UNITED24 fund, the company was able to
receive a state order for the production of such
drones. And although the collaboration was not
carried out through public-private partnerships,
but rather through the State order, this example
clearly demonstrates that the public and private
sectors can successfully implement projects even
in extreme conditions.
It should be understood that scientific and
technical cooperation is becoming an
increasingly important and effective form of
modern relations both at the national and
international level. Given the high rate of
scientific and technological progress, any
country, no matter how significant its potential in
the field of science and technology, can fully
satisfy its needs in advanced science and
technology for the production of the entire
spectrum of scientific products, which is
constantly changing and improving. Cooperation
in creating high-tech products is the most
important part of modern international relations.
Knowledge, especially science-based, is critical
to turning the increasingly complex problems
facing society into opportunities for more
sustainable development, achieving the
Sustainable Development Goals, and meeting
other shared commitments (Soroka, 2020).
Accordingly, within the framework of security
and defense, this model vividly describes the
synergistic effect of the interaction of the State
(mostly the Ministry of Defense), enterprises
regardless of ownership, as well as universities,
which are, on the one hand, places for generation
and testing of new ideas, and on the other –
provide qualified personnel to both State
agencies and enterprises creating innovative
products or providing services for this area.
However, regulatory and legal provision of
public-private partnership in the field of national
security requires significant modernization
(understanding all the complexity of the existing
mechanism and considering that a country is in a
state of armed conflict does not have time for
long procedures existing in peacetime).
Therefore, the Government’s Priority Action
Plan for 2023 determined that it is necessary to
develop and submit for approval a draft law on
amendments to the Law of Ukraine "On public-
private partnership" to create conditions for the
development of the defense and industrial
complex of Ukraine in order to stimulate the
development of the defense-industrial complex
using mechanisms of public-private partnership
and military technical cooperation with foreign
countries for the production of highly effective
weapons, military and special equipment,
meeting the needs of the Armed Forces, other
bodies of the security and defense sector,
increasing the export potential of the defense-
industrial complex, it is necessary to develop and
submit for approval a draft law on amendments
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to the Law of Ukraine "On public-private
partnership".
In addition to the above, Transparency
International Ukraine (2023) in its study "Public-
private partnership as a tool for the
reconstruction of Ukraine" presented the
following conclusions regarding the
prerequisites for the successful implementation
of public-private partnership:
1) predicted regulatory policy and priorities of
the State;
2) investment protection;
3) performance monitoring;
4) determination of the conditions of public-
private partnership;
5) project support;
6) research on the impact of public-private
partnership;
7) revision of conditions.
In our opinion, in the conditions of global
digitalization of public services, as well as in
view of the presence of corruption risks in
Ukraine, it is necessary to include a full transition
to online procedures as part of the successful
implementation of public-private partnership in
general, including in the field of national
security. Moreover, at the end of May 2023,
Prime Minister Denys Shmyhal presented the
Government’s vision for the coming years:
Ukraine is a digital country, convenient for
people and business, safe and economically
strong. Of the four core principles, one of them is
public-private partnership, primarily in the
military-industrial complex (Mosorko, 2022).
Using the safe direction of the public-private
partnership institution in the military-industrial
complex is, in our opinion, more promising
(provided it is reformed) than short-term
investments in startups. After all, its duration will
enable the private partner to strategically plan its
activities, which is a guarantee of stability and
sustainability.
Conclusions
Public-private partnership is a form of
cooperation between the public and private
sectors to solve certain tasks, projects or provide
certain services. In such partnerships, the public
and private sectors combine efforts, risks and
resources to achieve common goals.
We can summarize that the public-private
partnership in the field of national security and
defense is a form of cooperation that should
ensure the effectiveness of the implementation of
protective and defense measures in the manner
chosen by the subjects of the relevant contracts
or agreements. As a tool for ensuring national
security and stability of the State, it has
significant potential, because it can bring
together a significant number of stakeholders
with common goals, solutions of urgent problems
or the natural development of legal phenomena
and, as a result, - resources for achieving these
goals.
The use of the public-private partnership
institution in the military-industrial complex (for
example, for the development and manufacture
of drones) and after the war in rebuilding the
country is seen as the most promising directions
in the modern conditions in which Ukraine is.
This requires modernizing existing legislation to
simplify it regarding the access of private actors
to public funds and mechanisms for monitoring
the effectiveness of the use of their provision.
In addition to the above, it is necessary to make
other legislative changes to regulate the access of
private actors to the system of ensuring national
security and defense, for example, in the
following areas: security, detective work,
intelligence, military consulting, law
enforcement, counter-intelligence, anti-terrorist
activities, etc.
To improve administrative and legal regulation
of the public-private partnership, we propose to
perform its full transition to online procedures
that significantly simplify the participation of
potential investors in tender procedures, which is
undoubtedly a big step forward.
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