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Body of Knowledge:
Structuring and Drafting the Tender and Contract
From the standpoint of contractual risk allocation (that is, the reflection of the risk allocation into the contract), there are different categories of risks.
Compensation events – this refers to risk events for which the private partner is entitled to receive financial compensation if the event...
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Body of Knowledge:
Appendix Bid Preparation and Submittal the private sector perspective
The complexity of the procuring authority’s PPP project requires the consortium to adopt a project management approach to ensure that all necessary experts and skills are managed in an effective and timely manner. Upon signing the Letter of Intent (LOI), Memorandum of Understanding (MoU), or...
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Body of Knowledge:
Appendix Bid Preparation and Submittal the private sector perspective
6.8.1 Negotiating with Banks
The consortium’s financial advisory team prepares the Project Information Memorandum (PIM). The PIM sets out details of the PPP project, including the anticipated key contracts and projected revenues. Assuming a financing competition, a group of funders will be asked to...
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The following glossary of terms has been prepared by the authors. Some of these definitions are based on external sources, adapted for this PPP Guide, while others have been developed by the authors to reflect common usage and good practice.
The main external sources used to develop this Glossary...
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Body of Knowledge:
Operations and Handback
Variation management is closely connected with PPP agreement management and relates to the creation of mechanisms to enable changes to the PPP agreement. Such changes may be necessary as a result of a change in circumstances that could not be anticipated or quantified when the PPP agreement was...
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Body of Knowledge:
Strategy Delivery and Commissioning
From a practical perspective, the Value for Money generated through a PPP depends on the quality of the private partner and the government’s contract management systems and teams. This is especially true for PPP contracts that have some form of risk retention on the part of the government, be it in...
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Body of Knowledge:
Structuring and Drafting the Tender and Contract
Apart from providing public funds to partially compensate for construction, or through public debt or equity instruments, there are other indirect means by which the government can increase commercial feasibility and/or reduce the budgetary burden of the PPP. These can also be considered, in broad...
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Body of Knowledge:
Appendix Bid Preparation and Submittal the private sector perspective
This section describes the approach taken by the private party in a PPP project. The private party is the private sector entity that is successful in securing the right to implement and operate the procuring authority’s PPP project. A variety of names may be used to describe this private party....
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Body of Knowledge:
Structuring and Drafting the Tender and Contract
3.1 Establishing the Project Team, Incorporating Advisors and Finalizing the Project Management Plan for this Phase
It may happen that the project team was established before appraisal, contracting advisors to handle both appraisal and the structuring and drafting of the tender package. Otherwise...
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Body of Knowledge:
PPP Introduction and Overview
8.3.1. Arising during Pre-Tender and Tender Phases
The following are common examples of poor management during the pre-signature phase of the project process that reflect errors and risks of project failure (to be regarded as a non-exhaustive list).
The appraisal may conclude that the project...
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Body of Knowledge:
PPP Introduction and Overview
This PPP Guide focuses on PPPs as a method for procuring infrastructure development and management on the basis of private finance, as introduced in box 1.3. The definition of a private finance PPP provided in this PPP Guide implies a number of features which need to be present in a PPP contract to...
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Body of Knowledge:
PPP Introduction and Overview - Appendix A - Project Finance
The concept of project finance requires the sponsors to adopt a unique organizational structure in the form of a stand-alone project company (that is, a special purpose vehicle, SPV) which will enter into a PPP agreement with the government to design, build, and operate the project. This SPV has a...
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Body of Knowledge:
Structuring and Drafting the Tender and Contract
The RFP governs the bid requirements (what documents must be presented and how, which is developed further in section 8.1 below), the evaluation (rules and methods to evaluate and select – section 8.2), and other relevant matters such as protection for the government (for example, the right to...
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Body of Knowledge:
PPP Introduction and Overview
PPPs are a contractual means to deliver public assets and public services. PPP contracts include those intended to develop and manage new infrastructure, contracts to undertake significant upgrades to existing infrastructure (these are called infrastructure PPPs), and those under which a private...
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Body of Knowledge:
PPP Introduction and Overview
This section explains further the basic structure of a private finance PPP, assuming the form (or the scope) of a DBFOM that was first introduced in section 4.
Figure 1.10 illustrates the basic structure of a common PPP (in which all of the equity in the SPV is provided by the private sector). This...
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Body of Knowledge:
Strategy Delivery and Commissioning
The objective of PPP contract management is to obtain the services specified in the output specifications and ensure ongoing affordability, Value for Money (VfM) and appropriate management of risk transfer.
PPP contract management is the process that enables both parties in a contract to meet their...
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Body of Knowledge:
PPP Introduction and Overview - Appendix B - Sharia Finance
A traditional istina’a (‘istina’a’) is an agreement between two parties (the Islamic funder and the construction contractor) whereby the Construction contractor agrees at the outset to construct/manufacture a clearly described/specified PPP project asset for the Islamic funder. The price for...
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Body of Knowledge:
Strategy Delivery and Commissioning
Issue management usually comes into effect when significant risks arise or materialize. The PPP contract management manual should include issue management procedures that deal with irregularities and mitigate the issues that lead to risk materialization.
Conflict and issues typically occur within a...
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Body of Knowledge:
Strategy Delivery and Commissioning
Several studies show that some PPPs were cancelled during the Construction Phase due to the lack of or a poorly executed contract management function[17]. See table 7.4.
TABLE 7.4: Examples of Projects Cancelled during the Construction Phase
Project
Reason
Light Railway Transit (LRT...
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Body of Knowledge:
Structuring and Drafting the Tender and Contract
Default Situation and General Rules
When allocating risks, the government should be clear that risk transfer is defined by the contract scope and the PPP contract structure. Subject to the refinement of risk allocation, all risks inherent to the scope of the contract, and those appropriate to the...
