(a) Contractor
A contractor is responsible for the construction of the project. The construction in this guideline is used to broadly include design, build and engineer.
The government through a procurement process, for example the competitive tender process, normally selects the contractor for the project.
In most PPP projects, a contractor is a sub-contractor of the project company. Typically the government's requirements are set out in the concession agreement between the government and the project company, and the contractor's obligations to design and construct are contained in an EPC agreement. The EPC agreement usually contains "back-to-back" obligations with the concession agreement. That is to say, the obligations of the project company to design and construct the facility under the concession agreement are traced through to the obligations of the contractor under the EPC agreement.
(b) Engineer
Many parties to the project will appoint an engineer to advise on the technical aspects of the project. The role of the engineer would depend on the terms of the engineer's appointment, which in turns will vary according to the party appointing an engineer and the risks the party will assume.
The contractor will appoint an engineer to oversee and supervise the designs and technical aspects of the project. The project company will engage a professional engineer to review and advise on the progress of the work to be done by the contractors under the EPC agreement. Similarly, the government will engage an engineer to review and advise on the project company's compliance under the concession agreement, and also to advise in relation to the condition of the facility for the transfer back to the government. The lenders will appoint an engineer to issue progress reports for disbursements of the loan and to advise on issues that might affect financing.
An engineer may also serve as an arbiter for technically orientated disputes or questions between the parties. This is the case with the FIDIC standard form EPC agreements, which are widely used as the basis for EPC agreements internationally.
(c) Operator
On completion of the infrastructure project, the project company will appoint an operator to manage and maintain the infrastructure.
Often, the operator is the contractor or the project company itself. Where the operator is not the project company, an O&M agreement is needed to govern the relationship between the operator and the project company. The O&M agreement is sometimes labeled as a services agreement.
(d) Insurer
Given the high risks of infrastructure projects, the lenders normally require that the project company take out insurance on the projects. The insurance on a project is often considerable and needs to be factored into the cost of the project.
Insurance for political risks and commercial risks may be available from ECAs and other multi-lateral institutions such as MIGA.
(e) Escrow Agent
An escrow agent is sometimes appointed in a project to provide lenders with greater assurance. An escrow agent, normally a financial institution, is appointed by the parties to hold and disburse the proceeds of the project company in accordance with the terms of the loan agreements. A lender generally require an escrow agent to be appointed when it needs assurance that revenue arising from the operation of the infrastructure facility is disbursed in accordance with a pre-determined process. An escrow agent charges a fee for its services and normally insist on clear process in which funds in the escrow accounts will be disbursed.
(f) Supplier
A supplier of raw materials or equipment to the project may provide the raw material or equipment either to the project company, but more usually to the contractor or the operator.