As highlighted at the outset, understanding the whole context of a PPP Project is critical for Contracting Authorities when devising and negotiating the terms of a PPP Contract. Risk allocation has a direct impact on bankability and pricing, which determines whether a PPP Project will be affordable for a Contracting Authority or users and financeable by a Private Partner - and ultimately whether the asset and/ or service will be provided at all by means of a PPP. There is no "one size fits all" PPP Contract and contractual provisions cannot be looked at in isolation due to their close interplay.
This Guidance is intended to help Contracting Authorities carefully assess the issues specific to their own PPP Project and jurisdiction in developing contractual provisions. It explains the rationale for the drafting of certain material provisions that have formed the basis of many successfully procured PPP transactions around the globe and which have been developed through detailed risk allocation assessment and negotiation between Contracting Authorities, Private Partners and Lenders. Its goal is to help Contracting Authorities negotiate key aspects of PPP Projects confidently and efficiently and to reduce the time and money being spent negotiating contractual terms which may ultimately result in an unaffordable or unbankable PPP Contract.