The Diffusion of Risks in Public Private Partnership Contracts

Purpose The UK government argues that the benefits of public private partnership (PPP) in delivering public infrastructure stem from: transferring risks to the private sector within a structure in which financiers put their own capital at risk; and, the performance based payment mechanism, reinforced by the due diligence requirements imposed by the lenders financing the projects (HM Treasury, 2010). Prior studies of risk in PPPs have investigated ‘what’ risks are allocated and to ‘whom’, that is to the public or the private sector. The purpose of this study is to examine ‘how’ and ‘why’ PPP risks are diffused by their financiers. Design/methodology/approach This study focuses on the financial structure of PPPs and on their financiers. Empirical evidence comes from interviews conducted with equity and debt financiers. Findings The findings show that the financial structure of the deals generates risk aversion in both debt and equity financiers and that the need to attract affordable finance leads to risk diffusion through a network of companies using various means that include contractual mitigation through insurance, performance support guarantees, interest rate swaps and inflation hedges. Because of the complexity this process generates, both procurers and suppliers need expensive expert advice. The risk aversion and diffusion and the consequent need for advice add cost to the projects impacting on the government’s economic argument for risk transfer. Limitations and implications The empirical work covers the private finance initiative (PFI) type of PPP arrangements and therefore the risk diffusion mechanisms may not be generalisable to other forms of PPP, especially those that do not involve the use of high leverage or private finance. Moreover, the scope of this research is limited to exploring the diffusion of risk in the private sector. Further research is needed on how risk is diffused in other settings and on the value for money implication of risk diffusion in PPP contracts. Originality/value The expectation inherent in PPP is that the private sector will better manage those risks allocated to it and because private capital is at risk, financiers will perform due diligence with the ultimate outcome that only viable projects will proceed. This paper presents empirical evidence that raises questions about these expectations. Key words: public private partnership, risk management, diffusion, private finance initiative, financiers

Selective extracellular vesicle-mediated export of an overlapping set of microRNAs from multiple cell types

Background: MicroRNAs (miRNAs) are a class of small RNA molecules that regulate expression of specific mRNA targets. They can be released from cells, often encapsulated within extracellular vesicles (EVs), and therefore have the potential to mediate intercellular communication. It has been suggested that certain miRNAs may be selectively exported, although the mechanism has yet to be identified. Manipulation of the miRNA content of EVs will be important for future therapeutic applications. We therefore wished to assess which endogenous miRNAs are enriched in EVs and how effectively an overexpressed miRNA would be exported.

Results: Small RNA libraries from HEK293T cells and vesicles before or after transfection with a vector for miR-146a overexpression were analysed by deep sequencing. A subset of miRNAs was found to be enriched in EVs; pathway analysis of their predicted target genes suggests a potential role in regulation of endocytosis. RT-qPCR in additional cell types and analysis of publicly available data revealed that many of these miRNAs tend to be widely preferentially exported. Whilst overexpressed miR-146a was highly enriched both in transfected cells and their EVs, the cellular:EV ratios of endogenous miRNAs were not grossly altered. MiR-451 was consistently the most highly exported miRNA in many different cell types. Intriguingly, Argonaute2 (Ago2) is required for miR-451 maturation and knock out of Ago2 has been shown to decrease expression of other preferentially exported miRNAs (eg miR-150 and miR-142-3p).

Conclusion: The global expression data provided by deep sequencing confirms that specific miRNAs are enriched in EVs released by HEK293T cells. Observation of similar patterns in a range of cell types suggests that a common mechanism for selective miRNA export may exist.

Aminoarabinose is essential for lipopolysaccharide export and intrinsic antimicrobial peptide resistance in Burkholderia cenocepacia

One common mechanism of resistance against antimicrobial peptides in Gram-negative bacteria is the addition of 4-amino-4-deoxy-l-arabinose (l-Ara4N) to the lipopolysaccharide (LPS) molecule. Burkholderia cenocepacia exhibits extraordinary intrinsic resistance to antimicrobial peptides and other antibiotics. We have previously discovered that unlike other bacteria, B. cenocepacia requires l-Ara4N for viability. Here, we describe the isolation of B. cenocepacia suppressor mutants that remain viable despite the deletion of genes required for l-Ara4N synthesis and transfer to the LPS. The absence of l-Ara4N is the only structural difference in the LPS of the mutants compared with that of the parental strain. The mutants also become highly sensitive to polymyxin B and melittin, two different classes of antimicrobial peptides. The suppressor phenotype resulted from a single amino acid replacement (aspartic acid to histidine) at position 31 of LptG, a protein component of the multi-protein pathway responsible for the export of the LPS molecule from the inner to the outer membrane. We propose that l-Ara4N modification of LPS provides a molecular signature required for LPS export and proper assembly at the outer membrane of B. cenocepacia, and is the most critical determinant for the intrinsic resistance of this bacterium to antimicrobial peptides.

Export of O-specific lipopolysaccharide

The O antigen is the most surface-exposed component of the lipopolysaccharide (LPS) molecule and its biogenesis involves several complex mechanisms not completely well understood. All of these mechanisms involve biochemical reactions that occur on the cytoplasmic side of the plasma membrane as well as several different translocation pathways that deliver the nascent O antigens in a glycolipid form to the periplasmic side of the plasma membrane. This article discusses our current understanding of the mechanisms operating in the biogenesis of the O-specific LPS.

Weighing China’s export basket: The domestic content and technology intensity of Chinese exports

In this paper we use new, detailed, and comprehensive linked firm-transaction data to measure the domestic content and technology intensity of Chinese exports over the period 2000–2007. We evaluate the extent of value-added in China’s exports, using a modification of a method proposed by Hummels et al. (2001) which takes into account the prevalence of processing firms. In addition, we provide new estimates of the skill-and technology-intensity of China’s exports. Our estimates of value-added suggest that the domestic content of China’s exports increased from only 53% to about 60% over the period 2003–2006. Our cross-firm analysis reveals that processing exporters have value-added shares approximately 50% lower than non-processing exporters, even after accounting for ownership, location, and industry. We also show that Chinese exports have become increasingly sophisticated, largely driven by skill and technology improvement within industries.

Ulysses contracts in medicine

Ulysses contracts are a method by which one person binds himself by agreeing to be bound by others. In medicine such contracts have primarily been discussed as ways of treating people with episodic mental illnesses, where the features of the illness are such that they now judge that they will refuse treatment at the time it is needed. Enforcing Ulysses contracts in these circumstances would require medical professionals to override the express refusal of the patient at the time treatment is required, something that is generally problematic both ethically and legally. In this paper I will argue that despite appearances Ulysses contracts can make it the case that treating a patient in such circumstances is an instance of treating him with his consent, although safeguards are needed to ensure that this is the case. Given the potential benefits to patients I further argue that modified Ulysses contracts should be made legally enforceable.

Choice of contracts in the British National Health Service: An empirical study

Following major reforms of the British National Health Service (NHS) in 1990, the roles of purchasing and providing health services were separated, with the relationship between purchasers and providers governed by contracts. Using a mixed multinomial logit analysis, we show how this policy shift led to a selection of contracts that is consistent with the predictions of a simple model, based on contract theory, in which the characteristics of the health services being purchased and of the contracting parties influence the choice of contract form. The paper thus provides evidence in support of the practical relevance of theory in understanding health care market reform. © 2008 Elsevier B.V. All rights reserved.

Export Cartels: Is it Legal to Target your Neighbour? Analysis in Light of Recent Case Law

Despite the growing sophistication of antitrust regimes around the world, export cartels benefit from special treatment: they are almost universally tolerated, if not encouraged in the countries of origin. Economists do not offer an unambiguous policy recommendation on how to deal with them in part due to the lack of empirical data. This article discusses arguments for and against export cartels and it identifies the existing gaps in the present regulatory framework. The theoretical part is followed by an analysis of the recent case law: a US cartel challenged with different outcomes in India and South Africa, as well as Chinese export cartels pursued in the USA. The Chinese cases are particularly topical as the conduct at stake, apart from being subject to private antitrust actions before US courts, was also challenged within the WTO dispute settlement framework, pointing out to the existing interface between trade and competition. While the recent developments prove that unaddressed issues tend not to vanish, the new South-North dimension has the potential of placing export cartels again on the international agenda. Pragmatic thinking suggests looking for the solution within the WTO framework.

'It Is Not as Easy as ABC': Examining Practitioners' Views on Using Behavioural Contracts to Encourage Young People to Accept Responsibility for their Anti-Social Behaviour

This article examines the use of acceptable behavioural contracts as a tool for engendering the voluntary acceptance of responsibility in children and young people perceived to be engaging in anti-social behaviour and low-level criminality. Based on the results of a qualitative empirical analysis with local government and social housing anti-social behaviour teams, the article explores the attitudes of practitioners to the use of this unregulated but commonly utilised intervention. Practitioners' views are contrasted with the ideals of voluntary responsibilisation upon which the contracts are supposedly based. It is argued that there is a spectrum of differing approaches among practitioners, with some using the contracts more to encourage the voluntary acceptance of responsibility, whilst others use them more coercively to hold individuals responsible for their behaviour. The implications of these differing approaches are examined.

The 'Ordinariness of the EU's Foreign Policy Power: The Use of WTO Litigation as a Means to Export EU Norms, Values and Interests

The EU has historically been portrayed as a distinctive international actor both in terms of the norms and values it exports in context of its international relations and the manner in which it seeks to influence others. However, such claims to the EU’s distinctiveness are increasingly being questioned. This article joins this chorus of voices arguing the non-distinctiveness of the EU’s foreign policy power by focusing on a specific feature of the EU’s external trade policy, the role of World Trade Organization (WTO) dispute settlement in the EU’s attempts to promote its interests, values and norms.

How high (and far) can you go? On setting fines in cartel cases involving vertically-integrated undertakings and foreign sales

Contracts for the Sale of Land: Understanding the Impecuniosity Defence

Where either the seller or buyer of landed property fails to complete a contract to sell land the non-breaching party has a right to seek specific performance of the contract. This remedy would compel the party in default to perform the contract on pain of being held in contempt of court if the court's order is not obeyed. The defaulting party would not be able to satisfy its obligations under the law by paying a sum of money as damages for breach of contract. This paper considers the impecuniosity defence to specific performance as recognised by courts in Northern Ireland, the Republic of Ireland, Australia and New Zealand. Where the buyer demonstrates that he or she simply cannot raise the funds to buy the property specific performance will not be decreed and the court will make an award of damages for breach of contract measured by the difference between the contract price and the market price of the property at the time of default. The paper considers the nature and parameters of this defence and how it differs (if at all) from the alternative defence of extreme hardship. The paper addresses the question of whether it might be better to move to a position where sellers of land in all cases no longer enjoy a presumption of specific performance but have to demonstrate that the alternative remedy of damages is clearly inadequate. If this should be so the paper goes on to consider whether abolition of the presumption in favour of specific performance for sellers should lead to abolition of the presumption of specific performance for buyers, as is the position in Canada following the Supreme Court's decision in Semelhago v Paramadevan [1996] 2 SCR 415.