As the State commences paying for the Project Assets from the Operational Commencement Date, the State typically requires the Maintained Asset to be operational from that date. For example, a hospital needs to be treating patients, and a road needs to be open to traffic, from the Date of Commercial Acceptance. On some projects this requires the State to have access to the asset for a period of time before Commercial Acceptance to prepare for the operation of the Maintained Assets from the Operational Commencement Date. Accordingly, the PV Standard Project Deeds allow for either a two or three stage Acceptance regime:
• A two stage Acceptance regime which consists of Commercial Acceptance and Final Acceptance. This is typically used on infrastructure where services are fully outsourced so that there is limited if anything that the State needs to do to prepare for operations.
• A three stage Acceptance regime which includes Technical Acceptance, Commercial Acceptance and Final Acceptance with a commissioning period between Technical Acceptance and Commercial Acceptance during which the State can access the Project Assets to prepare for operations.
The Technical Acceptance and commissioning regimes have been included in the SIPD as this is the typical model for Social Infrastructure Availability PPPs. If the LIPD is used but a Technical Acceptance regime is necessary, clauses 22 and 23 from the SIPD (and associated definitions and operative provisions) should be included in the LIPD used for the Project.
The criteria for achieving Acceptance and the tests that must be performed for the Independent Reviewer or the State (as applicable) to determine whether Acceptance has been achieved must be set out in the PSDR.
Certification of Acceptance will not of itself evidence that the Works have been carried out in accordance with the Project Deed or that Project Co has satisfied the FFP Warranty.
A Major Default will occur if:
• Project Co fails to achieve:
- Technical Acceptance by the Date for Technical Acceptance (if applicable);
- Commercial Acceptance by the Date for Commercial Acceptance; or
- Final Acceptance by the Date for Final Acceptance; or
• the Independent Reviewer considers that Commercial Acceptance will not be achieved by the Date for Commercial Acceptance (refer to section 2.26.5 for further discussion).
Project Co may be entitled to an extension of time to a Date for Acceptance if there is an Extension Event (refer to section 2.26 for further discussion).
The Acceptance process is set out in Annexure 2.