Bristol City Council

Commercial review of an existing Concession Agreement

Overview

The Council had placed their extensive telecoms duct infrastructure into a formal Concession Agreement with the expectation that the revenues due the Council, would power the city’s growth towards being ‘a city of hope and aspiration where everyone can share in its success’. 

A few years into the agreement, the Council felt that it wasn’t getting the returns it had expected under the Agreement or that the Concession was delivering on the promises made to the Council at the time of the tender process.

The Council were looking for a review to confirm or allay their concerns, as well as assistance and guidance on managing any issues found.


The Strategy

In early 2018, the team brought its years of procurement and contracting knowledge to bear on the challenge by providing:
  • A review of the Agreement and an assessment of the Concessionaire’s performance against its obligations under the Concession Agreement 
  • Advice for the Council’s legal team that, commercially, there was a challenge to be made against the Concession Agreement. The Council chose to issue a Notice of Default against the Concessionaire.
  • A concise calculation of monies owed to the Council by interpreting the terms of the Agreement and matching that back to the records of activity on the network.
  • Support for the Council throughout the review meetings with the Concessionaire, providing technical and commercial knowledge to the discussions and advising the Council on possible resolutions 
  • Stakeholder management by provided inputs and reviewing reports to the Council’s management team and in briefings to their legal team (both internal and external)
  • A model for an industry based method and level of charging for Council’s fibres, used by the Concessionaire outside of the Concession Agreement.

Knowledge & Skills
  • Contract interpretation and understanding of contract law.
  • Understanding of the Government Tendering process.
  • Understanding of the UK regulatory regime for telecoms.
  • Knowledge of the telecoms infrastructure (duct and fibre) market in the UK.
  • Cost Management and financial interpretation of contracts.
  • Contract negotiations.
  • Stakeholder management both within the Council and with the Concessionaire.

Results
  • While the process to resolve the issues with the Concessionaire are still ongoing, the Council has a clear road map as to how to proceed and a plan for what may eventuate.
  • Cambridge MC’s resources continue to support our client through the process.
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