Interdisciplinary Studies in the Humanities

Document Type : Original Research Paper

Authors

¹ Department of Law, Faculty of Law and Political Sciences, University of Tehran, Tehran, Iran

² Department of Law, Faculty of Law and Plitical Sciences, University of Tehran, Tehran, Iran

https://doi.org/10.22035/isih.2021.3951.4058

Abstract

Financing sources used in infrastructure project is not merely equity capital, it is rather more debt capital. One of the most practical method in this regard is project finance. Because of two inherent characteristics of project finance- high leverage and non-recourse - it's necessary to consider special contractual rights for lenders. The existence of these rights and taking control over the project lead to high interdependence and nexuses of contract to the extent that we can assert the existence of contractual network in project finance. Contractual networks as a separate nature consider more flexibility to draft project contracts and can help to absorb more investment.

Keywords

Main Subjects

References

All Answers Ltd. (November 2018). Currie v Misa - Summary. Retrieved from https://www.lawteacher.net/cases/currie-v-misa.php?vref=1

Amstutz, M., & Teubner, G. (2009). Networks: legal issues of multilateral co-operation. Oxford: Hart Publishing.

Blanc, V.G. (1997), Clause Compromissoire Et Clause Attributive De Juridiction Dans Un Meme Contrat Ou Dans Un Meme Ensemble Contractuel http://www.tendancedroit.fr/wp-content/uploads/2019/04/G_ACTIONNAIRE_ep3.pdf

Brealey, R. A., Cooper, I. A., & Habib, M. A. (1996). Using project finance to fund infrastructure investments. Journal of Applied Corporate Finance, 9(3), 25–39. doi:10.1111/j.1745-6622.1996.tb00296.x

Brealey, R.A., Cooper, I.A., & Habib, M.A. (1996). Using project finance to find Infrastructure Investments. Journal of Applied Corporate Finance, 9(3), 25-39. doi: 10.1111/j.1745-6622.1996.tb00296.x

Byoun, S., & Xu, Z. (2014). Contracts, governance, and country risk in project finance: Theory and evidence. Journal of Corporate Finance, 26, 124–144. doi:10.1016/j.jcorpfin.2014.03.003

Carole A. De Vincelles (2011). Linked contracts under French law. Reterived from 10.4337/9781849809696.00013

Corielli, F., Gatti, S., & Steffanoni, A. (2010). Risk shifting through nonfinancial contracts: effects on loan spreads and capital structure of project finance deals. Journal of Money, Credit and Banking, 42(7), 1295–1320. doi:10.1111/j.1538-4616.2010.00342.x

Dailami, M., & Hauswald, R. (2007). Credit-spread determinants and interlocking contracts: A study of the Ras Gas project. Journal of Financial Economics, 86(1), 248–278. doi:10.1016/j.jfineco.2007.03.001

David, R. J., & Han, S. K. (2003). A systematic assessment of the empirical support for transaction cost economics. Strategic Management Journal, 25(1), 39–58. doi:10.1002/smj.359

Dehghani, T. (2014). Investment and affording financial projects of gas and oil. Tehran, Iran: Institute for International Energy Studies.

Ebrahimi, S., & Javandel Jananloo, F. (2015). Risk tefcel management in the petroleum upstream contracts drafting. Journal of Researches Energy Law Studies, 1(1), 17-36. doi: 10.22059/jrels.2015.54550

Esty, B. (2002). Returns on project-financed investments: evolution and managerial implications. Journal of Applied Corporate Finance, 15(1), 71–86. doi:10.1111/j.1745-6622.2002.tb00342.x

Esty, B.C. (2003). The Economic Motivations for Using Project Finance. January 2003. Harvard Business School: Mimeo.

Fabrizio, C. (2011). Contractual networks and contract theory: A research Agenda for European contract law. Edward Elgar Publishing.

Fabrizio, C. (2011). Networks, inter-firm cooperation and economic growth contractual. Edward Elgar Publishing.

Fama, E. F. (1990). Contract costs and financing decisions. The Journal of Business, 63(S1), S71. doi:10.1086/296494

Farrell, L. (2003). Principal-agency risk in project finance. International Journal of Project Management, 21(8), 547–561. doi:10.1016/s0263-7863(02)00086-8

Gatti, S. (2013). Credit risk in project finance transactions. Project Finance in Theory and Practice, 321–369. doi:10.1016/b978-0-12-391946-5.00008-6

Gatti, S. (2013). Introduction to the theory and practice of project finance. Project Finance in Theory and Practice, 1–25. doi:10.1016/b978-0-12-391946-5.00001-3

Ghamami, M. (2010). Financing BOT Projects. Comparative Law Review, 1(2), 101-122. doi: 10.22059/jcl.2010.80797

Hainz, C., & Kleimeier, S. (2012). Political risk, project finance, and the participation of development banks in syndicated lending. Journal of Financial Intermediation, 21(2), 287–314. doi:10.1016/j.jfi.2011.10.002

Hatami A., & Karimiyan, E. (1394). Foreign investment law in light of investment act and contracts. Tehran, Iran: Tisa.

Hennart, J.-F. (2010). Transaction cost theory and international business. Journal of Retailing, 86(3), 257–269. doi:10.1016/j.jretai.2010.07.009

Jensen, M. C. (1996). Agency costs of free cash flow, corporate finance, and takeovers. Corporate Bankruptcy, 11–16. doi:10.1017/cbo9780511609435.005

Jensen, M. C., & Meckling, W. H. (1998). Theory of the firm: managerial behavior, agency costs and ownership structure. SSRN Electronic Journal. doi:10.2139/ssrn.94043

John, T. A., & John, K. (1991). Optimality of project financing: Theory and empirical implications in finance and accounting. Review of Quantitative Finance and Accounting, 1(1), 51–74. doi:10.1007/bf02408406

Kraus, A., & Litzenberger, R. H. (1973). A state-preference model of optimal financial leverage. The Journal of Finance, 28(4), 911–922. doi:10.1111/j.1540-6261.1973.tb01415.x

Langlois, R.N. (July 20, 2016). The corporation is not a nexus of contracts. It's an iPhone. Available at https://ssrn.com/abstract=2856631 or http://dx.doi.org/10.2139/ssrn.2856631

Lessard, D. R., & Miller, R. (2001). Understanding and managing risks in large engineering projects. SSRN Electronic Journal. doi:10.2139/ssrn.289260

Müllner, J. (2016). From uncertainty to risk—A risk management framework for market entry. Journal of World Business, 51(5), 800–814. doi:10.1016/j.jwb.2016.07.011

Müllner, J. (2017). International project finance: review and implications for international finance and international business. Management Review Quarterly, 67(2), 97–133. doi:10.1007/s11301-017-0125-3

Müllner, J. (2017). International project finance: review and implications for international finance and international business. Management Review Quarterly, 67(2), 97–133. doi:10.1007/s11301-017-0125-3

Oshkooh, H., & Sobhiyah, H. (1395). Program governance model, Appropriate with financing approach, case study of upstream oil and gas programs. Financial Management Perspective, 12, 1-108.

Poppo, L., & Zenger, T. (2002). Do formal contracts and relational governance function as substitutes or complements? Strategic Management Journal, 23(8), 707–725. doi:10.1002/smj.249

Portalis (1988). Discours Preliminaire Dur Le Code Civil https://mafr.fr/IMG/pdf/discours_1er_code_civil.pdf

Rugman, A.M. & Verbeke, A.(2003). Extending the theory of the multinational enterprise: internalization and strategic management perspectives . Journal of International Business Studies, 34(2), 125-137.

Smith, S. (1997). Contracts for the benefit of third parties: In defence of the third party rule. Oxford Journal of Legal Studies, 17(4), 643-663. doi: 10.2307/764754

South Isfahan Power plant (2006). Contractual approach of South Isfahan Power Plant. Rederived from https://www.mapnagroup.com/fa/companies/south-isfahan-power-plant

The Law Commission (1996). Privity of contract contracts for the benefit of third parties. Report No 242, Rederived from http://www.lawcom.gov.uk/wp-content/uploads/2017/02/lc242_privity-of-contract-contracts-for-the-benefit-of-third-parties.pdf

Whittaker S. (2011). Contract networks, freedom of contract and the restructuring of privity of contract.doi: 10.4337/9781849809696.00014

Williamson O.E (1988). Corporate Finance And Corporate Governance, American Finance Association. The Journal of Law & Economics, 233-261. doi: 10.2307/725118

Zohdi, M. (2016). A Guide to professional techniques in affording Finance resources And Investment. Tehran, Iran: Hezāre-ye Sevom.

Name *

Email Address *

Affiliation *

Comments *

Security Code *

CAPTCHA Image

Interdisciplinary Studies in the Humanities

Volume 13, Issue 2 - Serial Number 50
April 2021
Pages 149-176

Files

History

Receive Date: 25 June 2020
Revise Date: 30 November 2020
Accept Date: 03 February 2021

Share

How to cite

Statistics

Article View: 1,133
PDF Download: 791