26.1.3  Deductions

The following deductions will be made from the amount determined in accordance with section 26.1.1 or 26.1.2:

(a)  any costs incurred by government in determining the fair market value (including engaging the independent valuer);

(b)  any amounts owing by the private party to government as at the Termination Date (including any amounts government is entitled to set-off under the project agreement);

(c)  credit balances standing to any of the private party's bank accounts and insurance proceeds or other amounts owing to the private party, in each case only to the extent not taken into account in calculating the Estimated Fair Value;

(d)  government's reasonable forecast internal and external re-tendering costs as applicable; and

(e)  to the extent not covered by paragraphs (a) to (d) above, all additional costs reasonably incurred by government as a result of the default. 123

If, after deducting the above amounts, the Default Termination Compensation Amount determined in accordance with section 26.1.1 or 26.1.2 is negative, some jurisdictions will require the private party to pay that amount to government while other jurisdictions will deem the Default Termination Compensation Amount to be zero.

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123  This would generally exclude indirect and consequential losses for which government would otherwise not be liable.