REPUBLIC OF PERU

AGENCY FOR PROMOTION OF PRIVATE INVESTMENT

BID TERMS

PUBLIC TENDER

PROCESS OF PROMOTION OF PRIVATE INVESTMENT FOR EXECUTION OF PROJECTS:

“Broadband Installation for Comprehensive Connectivity and Social Development of Tumbes Region”

“Broadband Installation for Comprehensive Connectivity and Social Development of Piura Region”

“Broadband Installation for Comprehensive Connectivity and Social Development of Cajamarca Region”

“Broadband Installation for Comprehensive Connectivity and Social Development of Cusco Region”

ProInversión COMMITTEE in

ENERGY AND HYDROCARBONS PROJECTS– PRO CONECTIVIDAD

…...... 2015

Important notice: This is an unofficial translation. In case of divergence between the English and Spanish text, the version in Spanish shall prevail

CONTENT

1. PURPOSE AND CHARACTERISTICS OF THE TENDER 6

1.1. Call 6

1.2. Purpose of the Tender 6

1.3. Definitions 6

1.4. Legal Framework of tender 19

1.5. Powers of the Committee and ProInversión 23

1.6. Project financing contract 24

1.7. Tender Schedule 24

1.8. Interpretation and references 24

1.9. Considerations that govern the tender ………………………………………. …25

2. PARTICIPATION FEE, AUTHORIZED AGENTS AND LEGAL REPRESENTATIVES OF BIDDERS 25

2.1. Participation Fee 25

2.2. Assignment of Participation Fee 26

2.3. Authorized Agents 26

2.3.1. Designation of Authorized Agents 26

2.3.2. Designation Letter 26

2.3.3. Powers granted to Authorized Agents 27

2.3.4. Information of Authorized Agents 27

2.3.5. Notifications 27

2.3.6. Replacement 28

2.4. Legal Representative 28

2.4.1. Designation and Powers 28

2.4.2. Presentation of Power of Legal Representative 29

2.4.3. Place and Formalities for Granting of Power 29

2.4.4. Registrations in the Registry Office 30

3. INQUIRIES AND INFORMATION 30

3.1. Inquiries about the Bid Terms and Suggestions to the Draft Contract 30

3.1.1. Term to make inquiries and suggestions 30

3.1.2. Formality of inquiries and replies 30

3.1.3. Circulars 32

3.2. Access to information – Data Room 33

3.2.1. Access to Data Room 33

3.2.2. Non-Disclosure Agreement 33

3.2.3. Content of information of Data Room 33

3.3. Request of Interviews 34

3.4. Limitations of Liability 34

3.4.1. Independent decision of Bidders 34

3.4.2. Limitation of Liability 35

3.4.3. Scope of Limitation of Liability 35

3.4.4. Acceptance of Bidder of the provisions of Section 3.4 35

4. SUBMISSION OF ENVELOPES 36

4.1. Submission of Envelopes. 36

4.1.1. Submission of documents for shortlisting 36

4.1.2. Submission of Envelopes N° 2 and N° 3 36

4.2. Language 36

4.3. Original documents and copies 36

4.4. Form of submission of Envelopes Nº 1, Nº 2 and Nº 3 37

4.5. Cost of Preparation and Submission 37

4.6. Effects of Submission of documents and binding character of these Bid Terms 37

5. CONTENT OF ENVELOPE N° 1: REQUIREMENTS FOR SHORTLISTING 38

5.1. General Information 39

5.2. Shortlisting Requirements 39

5.2.1. Technical Requirements 39

5.2.2. Financial Requirements 40

5.2.4. Legal Requirements 42

5.3. Submission of information. 45

5.4. Conversion of figures. 45

5.5. Simplification mechanism 45

6. SUBMISSION OF CONTENT OF ENVELOPE Nº 1 AND SHORTLISTING RESULTS 46

6.1. Submission of Envelope Nº 1 46

6.2. Announcement of Shortlisted Bidders and changes of consortia 47

7. CONTENT OF ENVELOPES Nº 2 AND Nº 3 47

7.1. Content of Envelope Nº 2: Technical Proposal 48

7.2. Content of Envelope Nº 3: Economic Proposal 50

8. ACT OF RECEPTION OF ENVELOPES Nº 2 AND Nº 3, OPENING AND ASSESSMENT OF ENVELOPES Nº 2 51

8.1. Act of Reception of Envelopes Nº 2 and Nº 3 and Opening of Envelopes Nº 2 51

8.2. Assessment of content of Envelope Nº 2 51

9. OPENING OF ENVELOPES Nº 3 AND AWARD. 53

9.1. Act of Opening of Envelopes Nº 3 ...... 53

9.2. Procedure of Assessment and Competence Factors 53

9.3. Award 60

9.4. Challenge 61

9.5. Not Awarded Bid…...... …… ...... 62

9.6. Suspension or cancellation of Bid…………...... 63

10. CONTRACTED 63

10.1. Constitution 63

10.2. Requirements of legal person of contracted 63

11. CLOSING PROCEDURE 64

11.1. Verification of Legal Requirements 64

11.2. Closing Date 65

11.3. Closing Acts …. 65

11.4. Performance Bond of the Financing Contract 67

11.5. Execution of Guarantee of Validity, Effectiveness and Seriousness of Proposal 67

11.6. Guarantee Advancement 68

11.7. Entry into Force of Financing Contract 68

12. FINAL PROVISIONS 68

12.1. Applicable Laws 68

12.2. Jurisdiction and Competence 68

ANNEXES OF THE BID TERMS

ANNEX Nº 1

NON DISCLOSURE AGREEMENT

ANNEX Nº 2

Appendix Nº 1: INTERNATIONAL FINANCIAL ENTITIES

Appendix Nº 2: LOCAL BANKING COMPANIES AND LOCAL INSURANCE COMPANIES

ANNEX Nº 3: CONTENT OF ENVELOPE Nº 1

Form Nº 1: Affidavit Commitment of reliable information

Form Nº 2: Letter of presentation of technical requirements for shortlisting

Form Nº 3: Letter of presentation of financial information for shortlisting

Form Nº 4: Affidavit of legal person incorporated and in force

Form Nº 5: Affidavit in case of CONSORTIUM

Form Nº 6: Affidavit of percentages of participation

Form Nº 7: Affidavit of acquisition of participation fee indirectly

Form Nº 8: Affidavit to be enabled to contract with the State

Form Nº 9: Affidavit of waiver to diplomatic immunity or claim

Form Nº 10: Affidavit of advisors of Bidder

Form Nº 11: Affidavit of no participation in another BIDDER in the same PROJECT

Form Nº 12: Affidavit of no participation in another BIDDER in the same PROJECT (applicable for corporations that have listed their shares in the Stock Exchange)

Form Nº 13: Affidavit of verification of availability of radio electric spectrum

Form Nº 14: Affidavit of commitment of incorporation in case of consortium

Form Nº 15: Affidavit in case of having applied the simplification mechanism

ANNEX Nº 4: CONTENT OF ENVELOPE Nº 2

Form Nº 1: Affidavit of information effectiveness

Form Nº 2: Model of GUARANTEE OF VALIDITY, EFFECTIVENESS AND SERIOUSNESS OF THE PROPOSAL

Form Nº 3: Summary of TECHNICAL SPECIFICATIONS of the TRANSPORTATION NETWORK and the NETWORK OF ACCESS OF THE PROJECT

Form Nº 4: Replies to the TECHNICAL SPECIFICATIONS of the NETWORK OF ACCESS and the TRANSPORTATION NETWORK

Form Nº 5: Referential Program of Maintenance of the NETWORK OF ACCESS OF THE PROJECT

Form Nº 6: Affidavit that the equipment installed of the PROJECT will be new

Form N° 7. AFFIDAVIT for not exceeding the time of INSTALLATION STAGE OF THE PROJECT

ANNEX Nº 5: CONTENT OF ENVELOPE Nº 3

Form N° 1: Letter of presentation of Economic Proposal

ANNEX Nº 6

Model of Letter of Guarantee of Challenge of the Award

ANNEX Nº 7

Guide of Users of DATA ROOM

Form Nº 1: Identification of persons authorized to use the DATA ROOM and Table of data and stay in DATA ROOM

Form Nº 2: Request of multiple services of DATA ROOM

Form Nº 3: Request of technical inquiries of DATA ROOM

Appendix N° 1: List of documents of DATA ROOM

ANNEX Nº 8

TECHNICAL SPECIFICATIONS

A.  TRANSPORTATION NETWORK

B.  ACCESS NETWORK

ANNEX Nº 09

BID SCHEDULE

ANNEX Nº 10

Model of PERFORMANCE BOND OF FINANCING CONTRACT

ANNEX Nº 11

Model of GUARANTEE OF ADVANCEMENT

ANNEX Nº 12

Form Nº 1: AFFIDAVIT on the CLOSING DATE

Form Nº 2: AFFIDAVIT ON THE CLOSING DATE

Form Nº 3: AFFIDAVIT ON THE CLOSING DATE

ANNEX Nº 13

FINANCING CONTRACT

1.  PURPOSE AND CHARACTERISTICS OF THE TENDER

1.1.  Call

The Investment in Telecommunications Fund –FITEL.-through the Private Investment Promotion Agency - ProInversión, announces the public tender to transfer to the private sector the implementation of projects: "Broadband Installation for Comprehensive Connectivity and Social Development of the Tumbes Region"," Broadband Installation for Comprehensive Connectivity and Social Development and the Piura Region, ""Broadband Installation for Comprehensive Connectivity and Social Development of the Cajamarca Region" and "Broadband Installation for Comprehensive Connectivity and Social Development of the Cusco Region. "

All persons, or consortium or consortia (duly represented by the common legal representative) may participate in this tender, provided they meet the requirements of these Bid Terms.

1.2.  Purpose of the Tender

The tender aims to select legal entities or consortia that will be awarded resources from FITEL in the form of non-reimbursable financing to implement the projects: "Broadband Installation for Comprehensive Connectivity and Social Development of the Tumbes Region", "Broadband Installation for Comprehensive Connectivity and Social Development for the Piura Region," "Broadband Installation for Comprehensive Connectivity and Social Development for the Cajamarca Region" and "Broadband Installation for Comprehensive Connectivity and Social Development in the Cusco Region".

Optimizing the implementation of projects: "Broadband Installation for Comprehensive Connectivity and Social Development for Tumbes Region" and "Broadband Installation for Comprehensive Connectivity and Social Development for Piura Region," adds as objective of the tender to select one awardee for both undertakings (hereinafter "Broadband Installation for Comprehensive Connectivity and Social Development for the Tumbes Region - Piura" or Tumbes-Piura project).

The awardees will be in charge of the design, construction and transfer to the Peruvian State of the TRANSPORTATION NETWORKS of the awarded projects, and the design, construction, maintenance and operation of the ACCESS NETWORKS of the mentioned projects.

1.3.  Definitions

The Bidders to this tender should consider that the definitions and in general the content of these Bid Terms, unless expressly stated otherwise, are applicable for any of the projects: "Broadband Installation for Comprehensive Connectivity and Social Development of the Cajamarca Region," "Broadband Installation for Comprehensive Connectivity and Social Development of the Cusco Region" and "Broadband Installation for Comprehensive Connectivity and Social Development of the Tumbes-Piura Region.”

The terms defined in this Section shall mean the same if they are used in plural.

Any reference made in this document to “Section”, "Point", "Form" and "Annex", shall be understood made to sections, points, forms and annexes of these BID TERMS respectively, unless express indication in different sense.

All time references should be understood made to the local hour of Peru.

1.3.1.  MINUTES OF AWARD OF ASSETS OF THE ACCESS NETWORK: It is the document prepared by the FITEL whereby the CONTRACTED transfers ownership of the assets of the access network to FITEL, at the CLOSING of the FINANCING CONTRACT or when any of the circumstances set out in the financing contract occurs. The right to property includes the ground, underground and over ground according to the statement made by the Peruvian Civil Code. This document will be signed by the contracted and the FITEL.

1.3.2.  MINUTES OF AWARD OF ASSETS OF THE TRANSPORTATION NETWORK: is the document prepared by the FITEL whereby the CONTRACTED transfers to the MTC, the ownership and domain of the ASSETS OF THE TRANSPORTATION NETWORK, once the concession contract is subscribed between the MTC and the concessionaire of the operation of the TRANSPORTATION NETWORK or when any of the assumptions established in the FINANCING CONTRACT is produced. The right of property includes the ground, underground and over ground according to the statement made by the Peruvian Civil Code. The minutes will be subscribed between the CONTRACTED and FITEL, that will subscribe it in representation of the MTC.

1.3.3.  MINUTES OF CONFORMITY OF INSTALLATION AND TEST OF SERVICES OF THE ACCESS NETWORK: Is the document prepared by the FITEL and subscribed between the CONTRACTED and the FITEL whereby the first accepts the results indicated in the REPORT OF SUPERVISION OF THE ACCESS NETWORK, corresponding to the installations made. Likewise, with the subscription of this document is credited the compliance of the conditions established in the TECHNICAL SPECIFICATIONS, corresponding to the ACCESS NETWORK. The model of said minutes is shown in Appendix N° 4 of Annex N° 8-B of the BID TERMS and may be modified and is FITEL the entity that will finally determine its final content.

1.3.4.  MINUTES OF CONFORMITY OF INSTALLATION AND TEST OF SERVICES OF THE TRANSPORTATION NETWORK: Is the document prepared by the FITEL and subscribed between the CONTRACTED and the FITEL whereby the first accepts the results indicated in the REPORT OF SUPERVISION OF THE TRANSPORTATION NETWORK, corresponding to the installations made. Likewise, through this document is credited the compliance of the conditions established in the TECHNICAL SPECIFICATIONS corresponding to the total of the TRANSPORTATION NETWORK. The model of said minutes is shown in Appendix N°5 of Annex N° 8-A of the BID TERMS and may be modified, and is FITEL the entity that will finally determine its final content

1.3.5.  MINUTES OF INSTALLATIONS OF THE ACCESS NETWORK: Is the document with AFFIDAVIT nature that indicates and credits the compliance of the installation and operation of all the infrastructure, equipment, hardware, software and others necessary to provide access to Intranet offered by the ACCESS NETWORK. The model of minutes is shown in Appendix N° 2 of Annex N° 8-B of the BID TERMS, and may be modified, and is FITEL the entity that will define its final content. Said minutes will be subscribed by the CONTRACTED.

1.3.6.  MINUTES OF INSTALLATION OF THE TRANSPORTATION NETWORK: Is the document that indicates and credits the compliance of the installation and operation of the components of the TRANSPORTATION NETWORK. Is prepared by the CONTRACTED, according to the Model of Minutes that is submitted in Appendix N° 7 of Annex N° 8-A, for each node, and each section of optical fiber (link for pair of nodes), and for the Center of Operations of the Network (NOC) and CENTER OF MAINTENANCE. THE MINUTES OF INSTALLATION OF THE TRANSPORTATION NETWORK is subscribed by the CONTRACTED and is an AFFIDAVIT.

1.3.7.  NON DISCLOSURE AGREEMENT: Is the commitment that each BIDDER must sign before using the DATA ROOM, through its AUTHORIZED AGENTS or the common LEGAL REPRESENTATIVE in case of CONSORTIUM or persons appointed by the BIDDER. The text of the NON DISCLOSURE AGREEMENT is in Annex Nº 1 of the BID TERMS.

1.3.8.  AWARDEE: is the SUITABLE BIDDER who obtained the BID AWARD.

1.3.9.  GRANTING OF AWARD: Is the declaration that shall make the COMMITTEE determining the SUITABLE BIDDER who has submitted the BEST PROPOSAL according to the terms and conditions established in the BID TERMS and who has resulted the winner of the tender.

1.3.10.  AUTHORIZED AGENTS: Are the natural persons appointed as such by the BIDDER for purposes of this bid.

1.3.11.  BID TERMS: Is this document, including its annexes, forms, appendices and CIRCULARS issued by the COMMITTEE, fixing the terms under which the bid will be developed.