Michelmores LLP
Posted on 5 Mar 2021
By Michelmores LLP

Trainee blog: What does a seat in PPP & Projects involve?

[Read time: 2 minutes]

Wow, it's March already. The daylight hours are getting longer and the majority of us are starting to feel hopeful for spring and the easing of lockdown restrictions. It's also the month that we trainees start thinking about our next seat rotation.

I wanted to share my experience in a Real Estate seat which often puzzles most as to what the work we do entails.

So, what is PPP & Projects?

PPP stands for Public-Private Partnerships. At its core, it seeks to facilitate the investment in national infrastructure – hospitals, schools, roads, waste management etc. – without increasing public debt.

For example, private lenders might agree to fund the construction of a hospital on behalf of the government for a particular NHS Trust. A Project Company (a special purpose entity created to isolate the financial risk of the project) can then take responsibility for the design and build, and subsequent services provision on the Trust's behalf. The Project Company itself enters into a number of agreements, including with Facilities Management companies (and sub-contractors) for services such as cleaning, maintenance and/or catering. The private parties will then be remunerated provided performance meets specified standards.

Successes have been mixed and these types of projects and outsourced services have some detractors. Whilst there are many success stories, age-old debates are resurrected when there is a high-profile failure; such as, in recent times, the collapse of construction giant Carillion.

Procurement and maintenance of projects also concerns public sector contracts and therefore public expenditure on goods, works and services. For this reason, procurement is regulated. EU procurement law seeks to create a "level playing field" for all businesses across Europe who seek to benefit from such opportunities. Following Brexit, domestic regulation and preparation for future regulatory reform dominates. The UK will also follow the WTO's Government Procurement Agreement, and has agreed the EU-UK Trade and Co-operation Agreement.

Okay, and what can I be involved in as a trainee?

The Projects team advises a full range of public and private clients, including Universities, NHS Trusts and private sector operators. As a trainee, you can expect to be involved in the following:

  • Non-contentious areas – Reviewing contracts, preparing advice on contractual interpretations, drafting and amending documents, assisting with contractual negotiations, preparing completion "bibles" and undertaking post-completion tasks in relation to: Project Agreements; Facilities Management Contracts; Supplementary Agreements (varying the Project Agreement and/or Facilities Management Contract); and PFI School conversion funding documents and board minutes.
  • Research – Research tasks come up regularly and mine have included: procurement laws, Brexit implications, estoppel and Mercury completion. Research in this seat often focusses on niche areas, which can make for interesting reading and starts to develop your working commercial and technical knowledge.
  • Clients – During remote working, I have attended conference calls with clients and all parties' calls with the opposite parties and their lawyers where necessary to progress complex drafting issues and overcome impasse. You will typically draft the attendance note, which can be challenging in the first few months with lots of new acronyms! However, calls are particularly helpful in starting to understand the commercial drivers of each party, the industry "bigger picture" and key players.
  • Contentious areas – Opportunities to work with Construction, Commercial Litigation and BRI colleagues on defects issues, payment mechanism operation, changes to parent company guarantors and adjudications; either arising on initial site construction, or subsequent works and/or operation. Also, opportunities to draft correspondence with Counsel, reservation of rights letters and review settlement agreements.

The Projects seat provides a really interesting insight as to how the social infrastructure around you is built and operates. It is also a great opportunity to learn and apply different areas of law. Of course, there is always a great deal to learn if you decide to do a seat or qualify into this area, but the work is varied and the sector continues to evolve post-Brexit.