socialmedian: PFI Construction Contracts - What they do not want you to know [Matthew Dillon]

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PFI Construction Contracts - What they do not want you to know [Matthew Dillon]

Source: Ecademy: user blogs

Nov 04, 2009

Summary

PFI construction contracts - what they don't want you to know

Although the majority of Building Contractors are aware that the risk profile of PFI contracting is significantly more onerous than that under traditional forms of procurement, many Contractors remain ignorant of the true risks to which they are exposed or how to mitigate such risks when negotiating the terms of the Building Contract with the special purpose vehicle ("SPV"). Arguably, the real risk of PFI contracting is not in the flow down of risks from the Project Agreement but rather the risks that the SPV and Funder seek to pass down to the Contractor, risks that the SPV can accept but would prefer not to. Too few Contractors appreciate the finer points of PFI Building Contracts and the commercial position that can be secured if a robust stance is taken against the SPV. Admittedly the current financial climate may cause Contractors to accept risks that they would not normally assume and funders are particu

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