Project Finance


Despite a weak start to 2018, project finance deals in Latin America showed a significant increase over the year compared with 2017 in volume and value[1]. A majority of deals. Read more…

Select jurisdiction(s)

Select specific jurisdictions to filter on. Alternatively select no jurisdictions and select questions below to see all jurisdiction answers for them.

Select question(s)

Select specific jurisdictions to filter on. Alternatively select no jurisdictions and select questions below to see all jurisdiction answers for them.


  • 1.

    How common is project finance in your jurisdiction? In what sectors is project financing most common?

  • 2.

    What kinds of institutions typically act as sponsors and lenders in your jurisdiction? Why?

  • 3.

    What structures are most common?

  • 4.

    Does local law require (or is it advisable) that the project company be organised under the laws of your jurisdiction? What is the typical legal form of a project company and why? Does local law require that any of the project company’s equity be held by local investors?

  • Foreign Investment

  • 5.

    Please describe the foreign investment regime in your jurisdiction.

  • 6.

    Are there any restrictions on payments abroad or repatriation of capital by foreign investors?

  • 7.

    Is it permissible for a project company to maintain offshore foreign currency (eg, US dollar) accounts?

  • 8.

    What recent measures has your government implemented to make projects in your jurisdiction more attractive to foreign investors? Has this involved making government or other local sources of co-financing more available for projects?

  • Project and financing documents

  • 9.

    Will any of the financing or project agreements need to be registered or filed with any government authority or otherwise need to comply with local formalities to be valid or enforceable? Even if not necessary for enforceability, is there any special advantage in complying with local formalities?

  • 10.

    Are there any advantages in having the project company issue promissory notes that are governed by local law in addition to the credit agreement governed by New York (or other law)?

  • 11.

    Must any agreements (finance or project) be governed by local law?

  • Collateral security

  • 12.

    May a collateral agent act as the sole secured party for the benefit of a group of lenders whose composition may change from time to time?

  • 13.

    May a security interest be granted with respect to all of a project company’s assets? Are any types of property considered personal in nature (eg, permits that are granted to an entity that has satisfied certain specific requirements) or "of public interest" such that granting a security interest therein (or foreclosure thereon by the lenders) would not be permissible?

  • 14.

    What costs are associated with registering collateral security interests in your jurisdiction? Are such costs determined with respect to the obligations secured or the approximate value of the property?

  • 15.

    Does your jurisdiction require lenders to stipulate the value of their collateral security in the relevant security documents? If so, what happens if at the time of foreclosure the property is worth more? Must such amount be stated in local currency even if the financing is in a foreign currency? If so, what protections may be implemented against devaluation of the local currency?

  • 16.

    Does each item of collateral (eg, equipment) need to be individually identified (whether by serial number or otherwise) in the security document to grant a valid security interest in that item? Or would a general description of the types of collateral covered be sufficient?

  • 17.

    How do lenders satisfy themselves with respect to the absence of other liens on their collateral? Are liens centrally recorded or searchable? May contractors file mechanic liens? If so, are lien waivers enforceable?

  • 18.

    What steps must a lender take to foreclose on a collateral security interest in your jurisdiction? How does a beneficiary of a guarantee provided by a local entity or granted under local law enforce such guarantee? Are any self-help remedies available? Is a public or private sale permissible or required? Is a judicial sale necessary? May lenders participate as buyers in any such sale, including by bidding the debt owed by the project company to them in lieu of cash? May any such sale (private or public) be for foreign currency? Is foreclosure on a pledge of the ownership interests of the project company more efficient and less time-consuming than a foreclosure on individual assets of the project company?

  • 19.

    What creditors would enjoy a higher statutory priority with respect to the collateral security than the lenders?

  • 20.

    Would the lenders incur any liabilities upon foreclosure relating to project assets (as opposed to equity)?

  • 21.

    What legal restrictions exist with respect to the operation of the project post-foreclosure by the lenders or their designee?

  • 22.

    Would the agreement by a project company’s equity holders to make capital contributions to the project company (or directly to the lenders in satisfaction of the debt) be enforceable by the lenders (assuming such rights have been collaterally assigned by the project company to the lenders) in bankruptcy proceedings of the project company?

  • Dispute resolution

  • 23.

    Can a project company organised under local laws validly submit to the jurisdiction of a foreign court?

  • 24.

    Is service of process by mail recognised in your jurisdiction or would the project company need to appoint a process agent? If so, does the project company need to grant the agent a power of attorney?

  • 25.

    Are foreign judgments and arbitral awards enforceable in your jurisdiction? If so, does any process of ratification or additional review need to be carried out in the local court system as a condition to such enforcement? Do sovereign or quasi-sovereign entities (eg, a counterparty to a major project document to which the project company is a party) have the capacity to arbitrate as a matter of local law?

  • Miscellaneous

  • 26.

    Is subordination of debt recognised under the law of your jurisdiction?

  • 27.

    Are there laws in your jurisdiction that regulate how tariffs payable to a service provider (eg, a power plant or pipeline company) must be calculated? If so, please describe briefly.

  • 28.

    Do environmental, tax or other liabilities relating to the project extend beyond the project company to the direct or indirect owners of the project company or to the lenders?

  • 29.

    Are there any limitations (or incentives) with respect to importation of equipment or materials to be used in the project?

  • 30.

    What land issues might there be in connection with a project financing in your jurisdiction? Are there any restrictions on foreigners’ ownership of land or natural resources? How difficult is it to obtain rights of way (eg, in connection with a pipeline project that traverses many plots of land)?

  • 31.

    Please describe any other relevant legal considerations relating to project finance in your jurisdiction.

  • Public–private partnership (PPP)

  • 32.

    Has specific PPP-enabling legislation been passed in your jurisdiction? If so, and if applicable, has it been passed at the federal, state or municipal level and is it sector-specific?

  • 33.

    What legal limitations, if any, are there (whether constitutional or otherwise) on PPP transactions in general or with respect to particular sectors? Are there any limitations on the contracting power of the state, the state’s ability to incur long-term fiscal obligations, or the extent to which certain government functions may be performed by the private sector?

  • 34.

    Please describe the most significant PPP transactions that have been closed to date, including identification as to whether they were closed under existing or prior legislation?

  • 35.

    Does your jurisdiction have a national or regional centre of excellence or other authority with responsibility for developing PPPs and best practices? If so, please describe this authority and its role.

  • 36.

    What are the most common PPP financing structures in your jurisdiction and why?

  • 37.

    What are the most common procurement processes for a PPP transaction in your jurisdiction?

  • 38.

    What do you see as the primary impediments and drivers, both legal and commercial, to the development of PPP in your jurisdiction?

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