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GOVERNMENT CONCESSIONS IN PPP

THE GOVERNMENT CONCERNS Successful Construction of the Infrastructure asset. GOVERNMENT CONCESSIONS IN PPP. Quality and Quantity of Infrastructure service Accessibility of the service Regulatory Compliance Acceptable tariff Adequate maintenance Fair return on the investment.

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GOVERNMENT CONCESSIONS IN PPP

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  1. THE GOVERNMENT CONCERNS Successful Construction of the Infrastructure asset GOVERNMENT CONCESSIONS IN PPP

  2. Quality and Quantity of Infrastructure service • Accessibility of the service • Regulatory Compliance • Acceptable tariff • Adequate maintenance • Fair return on the investment

  3. CONCESSION AGREEMENT • Nature • Key Issues • A. Concession period • i. The cost of constructing the facility • ii. The cost of process for selecting the private sector • iii. The benefits of competition • B. Construction of the facility • i. Time and Price ii. Government Input

  4. iii. Completion • iv. Consequences of late completion • v. Consequences of early completion • C. Standards • i. Tariff • Ii. Regulation • iii. Amount • iv. Tariff Structure

  5. vi Tariff Structure • vii Access and discrimination • vii Integration • ix Administration • E. Role of the Government • i. Tax incentives • ii. Contribution of land and assets • iii. Network and logistical support

  6. iv Network and logistical support • v. Supply of labour and materials • vi Remittance of income from the project • vii Guarantees and stand-by financing • viii Non Competition • F. Change Orders • G. Termination

  7. H. Force Majeurs • I. Stabilisation • J. Dispute resolution • K. Choice of Law

  8. RISK ALLOCATION • A. Construction and Completion Risks • B. Operating risks • C. Demand and Price Risks • D. Technology Risks • E. Change of Law Risks • F. Environmental Risks • G. Casualty Risks • H. Ownership and Borrower Risks • I. Property and contigent liabilities • J. Country and Political Risk

  9. K. Counterparty Credit Risk • L. Exchange rate risks • M. Interest rate risks

  10. PERFORMANCE GUARANTEE TO GOVERNMENT • i. Trigger event • ii. Consequences of default • iii. Expiry • iv. Indemnity

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