Public interest and early termination of PPP contracts. Can fair and reasonable compensations be determined?

Rc Marques ()

Utilities Policy, 2021, vol. 73, issue C

Abstract: This article analyzes the different ways to terminate public-private-partnership (PPP) contracts early. It discusses how early terminations should be addressed to mitigate the consequences in terms of attractiveness, bankability, unfairness and litigation. The different ways to compensate private partners are examined. A new methodology for calculating the due compensation is proposed whenever governments voluntarily terminate a PPP contract based on the public interest. We posit that early termination clauses of contracts that comprise fair and reasonable compensations are required to provide meaningful incentives and contestability to acceptable returns on essential public services avoiding political and conflicting issues.

Keywords: Early termination of contracts; Fair and reasonable payment; PPP contracts (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:juipol:v:73:y:2021:i:c:s0957178721001351

DOI: 10.1016/j.jup.2021.101301

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