ABSTRACT
Project fi nance contracts (PFCs) have gradually become key tools for the fi nancing of exceptionally large and costly projects 2 serving both the private as well as the public sectors. 3 These are very sophisticated organizations that require high transaction costs for their implementation. 4
During the last years, the extraordinary organizational complexity and the growing popularity of PFCs have generated a proliferation of industry-oriented as well as interdisciplinary academic literature on the matter. However, academic literature dealing with specifi c agency confl icts in PFCs is still scarce. This dispersion may well result from the diversity of theoretical stances studying agency confl icts in the literature of corporate law and corporate fi nance as well as from the complexity and structural varieties adopted by PFCs in practice. Despite theoretical and practical diffi culties, based on their essential elements, some literature comparing agency relationships in corporate transactions and in PFCs has already been produced. 5
This chapter highlights the results of the fi rst of three components of ongoing research on the law and economics of PFCs. Three distinct pillars have been identifi ed in this study in progress: the fi rst pillar explores the agency confl icts generated by large projects in corporate transactions and how these confl icts are avoided by PFCs; the second pillar analyzes the agency confl icts within PFCs; and the third pillar explores possible legal implications from those agency confl icts in project fi nance.
