The approach to renegotiation depends on the regulatory framework of each jurisdiction, which can prescribe how renegotiation can or should be carried out. It may also depend on the process agreed in the PPP contract.
PPP contracts can set out a renegotiation clause which will typically specify under what conditions the renegotiation can be initiated and what the process will be. For a renegotiation initiated by the Project Company, this process might include a requirement for the Project Company to submit a request along with an explanatory memorandum as to why it is requesting a renegotiation. The explanatory memorandum should set out the detailed background to the renegotiation request, together with all relevant legal and/or contractual justifications that validate the need for the renegotiation. The process may include time limits to mitigate the risk of delay in effectively implementing the renegotiation.
However, it should be noted that parties can also renegotiate at any stage without an explicit procedure, as long as the amendment to the PPP contract has the agreement of all relevant parties.
It is common in civil law jurisdictions for the Procuring Authority to have the power to make unilateral changes to the PPP contract. This unilateral power will typically also attach the condition that the Procuring Authority will fairly compensate the Project Company for making such unilateral amendments. For this reason, the approach in these jurisdictions will not differ greatly for renegotiations, as the parties should still negotiate the amendments and the compensation payable.