By Dejan Makovsek, Stephen Perkins and Bjorn Hasselgren, International Transport Forum at the Organization for Economic Co-Operation and Development (OECD) Discussion Paper No 2014-25, January 2015.
Public-Private Partnerships (PPPs) are complex financing structures involving substantial transaction costs, with the legal documentation alone often consisting of several hundred pages. Despite the care taken in preparing PPPs, renegotiation is a common occurrence. Given the imperative of upholding contracts for efficiency and the daily reality of frequent renegotiation, the two main questions for this paper are: What are the primary reasons for renegotiations? And more importantly, do they generally uphold the spirit of the contract when they happen or are they more often motivated by interests, other than efficiency?
Tracking Number: PPPs for Transport_Renegotation_OECD.pdf