VEGAS LEX PPP and infrastructure practice has
organized a meeting on using concession in the road industry for employees of
the Federal Road Agency (Rosavtodor) and the Roads of Russia federal government
agency.
On 19 April 2017, the law firm
VEGAS LEX hosted an event on the topic “Concession: what we need to know about
it for the development of road industry” for the employees of the Federal Road
Agency and of the Federal State Institution “Roads of Russia”.
Elena Semyonova, Head of the Federal Road
Agency’s Department of Legal Support and Public-Private Partnership Projects,
and Ivan Grigorovich, Head of the Federal State Institution “Roads of Russia” addressed the participants with welcome
remarks.
Denis Shtirbu, Head of VEGAS LEX PPP and
infrastructure practice, explained to the participants in detail the concept of
concession and its relevance for the road infrastructure; listed the types of
concessions as well as concession objectives for the investor and for the state;
spoke about the specifics and advantages of concessions in the road sector; and
explained the backbone of the total cost of ownership and disposal theory in
relation to road projects.
Olesya Khityanik, Associate of VEGAS LEX PPP and
infrastructure practice, explained how to launch the concession and how to
verify the feasibility of the investment idea on a concession model. In
particular, the associate highlighted the key features of a concession, the
difference between launching the project as a private concession initiative or a
competition; and explained which projects may not be recognized as concessions.
Irina Dolgikh, Senior associate of VEGAS LEX PPP
and infrastructure practice, presented a step-by-step algorithm for developing
a concession, explaining why this algorithm is necessary and what its substance
is; discussed the organizational and legal model of a concession project, the project
risks and the ways to identify and manage them. The participants also learnt
about the contract model of a project: how to prepare a draft decision on
concluding a concession agreement and draw up its terms and conditions. Alexey Kharlamov, Senior analyst at
InfraONE, added information on the types of funding sources for a concession
road project and the return on investment.
Stanislav Kochev, Senior analyst at InfraONE, and
Irina Dolgikh spoke about difficulties in structuring the payment mechanism for
the project, considering the variability of concession terms and budget
legislation requirements, administering the concession grantor's payment and the
capital grant, and also taking into account the new FAS Russia risks.
At the end of the event, Dmitry Pitskov, Associate of VEGAS LEX PPP
and infrastructure practice, and Stanislav Kochev spoke about the concession grantor’s
control over the implementation of the agreement: how the control affects the effectiveness
of the project implementation, its development and evolution; the balance of
control over the project and supervision of fulfillment of the concessionaire's
obligations; and the principles and instruments of the concession grantor’s
control.
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more information on VEGAS LEX’s services in the
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