Environmental Engineering Reference
In-Depth Information
accept that it is going to “lose” part of its influence. Otherwise, no private investor
will be willing to invest in any kind of PPP.
1.3.5 Additional PPP Regulations
In addition to the four main characteristics of a PPP, there are other contractual
aspects which must be kept in mind. Despite the private operator
'
s independence,
the government should also include rights of inspection.
130
The term “partnership”
with a PPP should not belie the need to monitor the private operator,
131
as public
control (to a certain extent) is advisable since big scale projects often affect core
public interests. However, it would be wrong to assume that the private partner will
automatically and purposely violate any given law purely because it is legally
beneficial.
132
In cases of termination, there should be specific rules on how a transfer of the
asset will take place.
133
In addition, PPPs need to address the means by which the
value of the company will be calculated.
134
PPPs should also include a “solution
manual” on how to deal with breaches of contract.
135
In the event of a one-sided
termination that has resulted from a contractual breach on the part of the terminat-
ing party, there is a need to negotiate possible compensation.
136
This is also known
as
137
There is also the issue of what
happens in the event that the project is destroyed. Some PPPs contain a regulation
which, if the project is destroyed, requires the private sector to rebuild the whole
project despite any insurance and the question of whether the project can be insured
at all (e.g. all-risk insurance).
138
Finally, the importance of international dispute resolution processes, such as
international arbitration, is frequently emphasized in large scale projects.
139
All
contracts (independent of the drafting language) should take care to regulate a
consistent dispute settlement process.
140
Nevertheless, regular consultation can
help to avoid conflicts and strengthen the public-private cooperation.
141
(
...
) compensation on termination (
...
).
'
'
130
Kn
¨
tel in Siebel et al. (
2008
), paras 1311-1312 and 1420-1421; Roquette/Butcher in Roquette
and Otto (
2005
), F. Public-Private Partnership III para 46.
131
Davis (
2005
), 439 (439-440).
132
Kn
¨
tel in Siebel et al. (
2008
), para 1313.
133
Werner and Fiedler (
2007
), 91 (104); Roquette (
2007
), 147 (157).
134
Roquette (
2007
), 147 (157).
135
Roquette/Butcher in Roquette and Otto (
2005
), F. Public-Private Partnership III paras 85-87.
136
Werner and Fiedler (
2007
), 91 (103-104); Roquette/Butcher in Roquette and Otto (
2005
),
F. Public-Private Partnership III paras 88-90.
137
Roth (
2007
), 107 (114).
138
Jonas and Paulsen (
2007
), 13 (31).
139
Wahl (
1994
), 15 (21); cf. Christiansen (
2008
), 143 (158).
140
Ruchay (
1996
), 69 (84).