Key aspects on risk allocation
| Key Issue 3 – risk allocation | ||
|---|---|---|
| Case Study A (ITALY) | Case study B (USA) | |
| Administrative risk | In case of delays and related greater costs, the risk is allocated to the provider has to be found responsible; whereas as for lower incomes, the risk is allocated to the concessionaire | The risk is shared 50% between provider and concessionaire |
| Expropriation risk | In case of delays and/or increased costs, the risk is allocated over both the provider and the concessionaire | The risk is allocated 100% on the concessionaire |
| Environmental risk | In case of environmental damage, the risk has to be allocated 100% over the concessionaire | Not specified in the contract |
| Risk of project modification | In case of project modification, the risk is allocated only to the provider | The risk has to be defined on the different circumstances and is not well specified in the contract |
| Risk of delays in approval | In case of any delays in public administration approval, the risk is allocated only to the provider | Not specified in the contract |
| Risk of execution | Not specified in the contract | The risk has to be shared between the concessionaire and the provider proportionally to the investment |
| Risk of underestimation of costs | In case of an underestimation of costs, both the concessionaire and the provider share equally the risk | The concessionaire detains 100% the risk of cost underestimation |
| Risk of delays in realization | In case of realization of a structure nonconforming to expectations, clearly stated in the contract, the risk is allocated only to the concessionaire | The concessionaire detains 100% the risk of delays in realization |
| Risk of demand contraction | In case of demand contraction for unforeseeable reasons, the risk has to be shared by both provider and concessionaire | Both provider and concessionaire equally share the risks |
| Managerial risk | The concessionaire detains the 100% of the risk | The concessionaire detains the 100% of the risk |
| Political risk | The concessionaire detains the risk 100% | Not specified in the contract |
| Financial risk | The concessionaire detains the 100% of the risk | Not specified in the contract |
| Key Issue 3 – risk allocation | ||
|---|---|---|
| Administrative risk | In case of delays and related greater costs, the risk is allocated to the provider has to be found responsible; whereas as for lower incomes, the risk is allocated to the concessionaire | The risk is shared 50% between provider and concessionaire |
| Expropriation risk | In case of delays and/or increased costs, the risk is allocated over both the provider and the concessionaire | The risk is allocated 100% on the concessionaire |
| Environmental risk | In case of environmental damage, the risk has to be allocated 100% over the concessionaire | Not specified in the contract |
| Risk of project modification | In case of project modification, the risk is allocated only to the provider | The risk has to be defined on the different circumstances and is not well specified in the contract |
| Risk of delays in approval | In case of any delays in public administration approval, the risk is allocated only to the provider | Not specified in the contract |
| Risk of execution | Not specified in the contract | The risk has to be shared between the concessionaire and the provider proportionally to the investment |
| Risk of underestimation of costs | In case of an underestimation of costs, both the concessionaire and the provider share equally the risk | The concessionaire detains 100% the risk of cost underestimation |
| Risk of delays in realization | In case of realization of a structure nonconforming to expectations, clearly stated in the contract, the risk is allocated only to the concessionaire | The concessionaire detains 100% the risk of delays in realization |
| Risk of demand contraction | In case of demand contraction for unforeseeable reasons, the risk has to be shared by both provider and concessionaire | Both provider and concessionaire equally share the risks |
| Managerial risk | The concessionaire detains the 100% of the risk | The concessionaire detains the 100% of the risk |
| Political risk | The concessionaire detains the risk 100% | Not specified in the contract |
| Financial risk | The concessionaire detains the 100% of the risk | Not specified in the contract |
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