Risks associated with changes in law, taxation and Government policy are usually shared between the parties or negotiated to apply conditionally to a particular party. Normally, the private sector will bear the risk of changes to Commonwealth taxation law, as a normal risk in the course of carrying on a business.
The allocation of risks arising from changes to the law generally is more complex. Where, for example, the project is exposed to changes in Government legislation, an adverse outcome arising from a policy decision taken by Government to change that law will be borne by Government rather than the private sector.