1.2.2.4 Increased finance costs pre-completion -

If Force Majeure delays completion of the PPP Project asset, the Private Partner will not be able to commence service operations and start earning revenue to meet its debt service obligations. It may incur additional interest and commitment fees and costs of rescheduling its repayment obligations. If the Private Partner adds in some contingency pricing against this risk, this will have value for money implications for the Contracting Authority. In recent years, PPP Contracts in some jurisdictions (e.g. the Netherlands) have expressly provided for certain compensation in this regard, with mechanics distinguishing between different types of debt and lengths of delay.