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A Study On Some Legal Issues Of Project Financing

Posted on:2006-09-06Degree:MasterType:Thesis
Country:ChinaCandidate:M DaiFull Text:PDF
GTID:2166360182967924Subject:Law
Abstract/Summary:PDF Full Text Request
Project financing is the financing of a particular project in which a lender is satisfied to look initially to the cash flows and earnings of the project as the source of funds from which a loan will be repaid and to the assets of the economic unit as collateral for the loan.Other guarantees either are absent or cover only certain limited risks.The project financier is restricted to resources to shareholders of the project company in the event that the project fails to generate sufficient revenues.So project finance is also said to be "non-resource"financing or "limited resource"financing.Because the project applying to the project financing is usually giant,long periodical and riskful, the parties and legal issues it involves are more complex compared with traditional financing. The legal principal parties involved in the project financing are as follows: the lender,the project initiator,the borrower,the user of the project(the buyer of the product or the consumer of the project),the provider of the materialjthe warrantor,and so on.There are many legal relationships between these parties, such as the relationship between the project initiator and the project company,the guarantee relationship between the project initiator and the lender,the debit and credit relationship between the project company and the lender, the trade relationship between the project company and the material provider. The laws related to the project financing involve the contract law, the corporation law, the sponsion law, the bank law, the negotiable security law and so on. So it is important to deal with the legal relationship between these parties properly, which is crucial to the project financing.There are four parts in this thesis.The first chapter is about the contract which is the fundermental legal instrument in the course of project financing. In this chapter I discuss the contracts applied in the project financing ,which comprise the investment agreement, the completion guarantees, the purchase agreement, the forward purchase agreement, the production payment agreement, the take-or-pay contract, the concession agreement, and the contractual structure.The second chapter expatiates the legal relationship between the parties and other legal issues in the international syndicated loan. In this chapter I analyse the legal relationship between the parties in the direct participation syndicate and the indirect participation syndicate, and also discuss the fashion of participation syndicate.The third chapter introduces the regulations of the project financing and the correlative law frame of our country. In this chapter I summarize the practice of the regulations of the project financing and sum up the provisions related to the project financing in our country.The last chapter discuss the issues of the application of the substantive law in the project financing and the issues of the jurisdiction. In this chapter I analyse the factors which influence the choice of the substantive law and introduce some theories related to it. I also discuss the issues of how to determine the court and analyse our country's provisions and discuss the issues of the sovereign immunity.
Keywords/Search Tags:project financing, project company, syndicate loan
PDF Full Text Request
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