6.2.1  Authority to execute Direct Agreement

In certain jurisdictions, there may be mandatory laws preventing the granting or enforcement of Lender step-in rights (in particular, under public policy rules applicable to insolvency procedures and/or public procurement regulations applicable to Contracting Authorities that have not been tailored to PPP Projects). Well-drafted PPP laws typically authorise entry by a Contracting Authority into both PPP Contracts and the Direct Agreements that usually accompany them. Accordingly, this should be carefully analysed and addressed by Contracting Authorities before commencing the procurement of its PPP Contract.