Proceedings of the 14th Meeting of the
Transport and Communications Working Group
9
 Key concerns for the public sector depend on the specific form of contract and on how
the private party net cash-flow vulnerability is affected by traffic/demand trends;
 There is a trade-off between close monitoring, on one side, and leaving the
concessionaire free to find the best way to deliver services under the PPP contract, on
the other side;
 A mitigation measure against renegotiation consists of developing and maintaining a
system of reputation tracking for contractors.
6. End of contract:
The sixth and final phase of the conceptual framework covers the following aspects: contract
return; follow up.
Analytical points:
A PPP can come to its end for 2 reasons, either contract expiry or early termination. In turn, early
termination can come about because of a default by the private party, because of termination by
the public authority (for reasons of public interest or default) or due to a so-called force majeure.
Whatever the reason for the end of the PPP contract, project assets are handed back to the public
authority. At this stage, transfer risk arises, i.e. a risk that the conditions of the assets are not
compliant with the contract’s maintenance standards. İn addition, the public authority is faced
with the trade-off between taking the asset back or re-tendering, bearing in mind the need for
continuity in the service delivery.
Internal capacities for preparing the contract’s final phase are essential for its correct
development. In addition, ex-post evaluation of transport PPPs by independent experts
represents a chance to learn from experience and improve the preparation and implementation
of such contracts.
Key messages from the literature review and good practices:
 Despite differences in risks between early termination and closure at maturity, in both
cases, the lack of preparedness by the public party may lead to excessive risk-taking. In
this regard, decisions ought to be taken with reasonable anticipation and resources
should be committed to the management of the contract’s final phase in time;
 Adequate preparation for termination requires institutional memory, which is
facilitated by the evaluation of individual PPP projects or large PPP programs.
Global trends
The presentation of the structure of the conceptual framework and its 6 phases was then
complemented by Ms. Pancotti with a discussion of 4 global trends identified in the research
study.