ASECAP: Cooperation needed for better toll-road risk management

Toll operators must offer a level of service for which drivers are prepared to pay because in many cases, drivers have alternative free-use routes. Incentives to attract drivers onto toll roads must include shorter and reliable journey times as well smooth and trouble free travel – all at an affordable price. Private companies running toll roads face the same difficulties as any other commercial entity, in particular financing construction before any toll revenue can be collected. Hardly surprising that fin
May 31, 2017 Read time: 3 mins
Guy Chetrit: PPPs may not be the answer
Toll operators must offer a level of service for which drivers are prepared to pay because in many cases, drivers have alternative free-use routes. Incentives to attract drivers onto toll roads must include shorter and reliable journey times as well smooth and trouble free travel – all at an affordable price.


Private companies running toll roads face the same difficulties as any other commercial entity, in particular financing construction before any toll revenue can be collected. Hardly surprising that financing was one of the major themes at a recent Study and Information Days event put on by 1103 ASECAP, the European association of toll concessionaires.

The stakes are high. ASECAP’s members operate more than 50,000km of tolled highways. Across the Atlantic, members of the International Bridge Tunnel and Turnpike Association (2793 IBTTA), ASECAP’s North American equivalent, operate more than 8,500km of highway.

A client’s tender document for a planned toll road includes all the details including the road’s proposed route and design, land surveys and – importantly - estimates of expected traffic volumes. Potential bidders base their calculations upon this data.

However, should there be significant differences between the details provided and reality, the winning bidder can make a claim for changes to the contract – especially in terms of payment. The construction phase represents one of the biggest risks - particularly as the road may not be open and therefore the concessionaire would not be receiving any toll revenue.

The moment the contract is signed, “the partnership ends and the fighting begins. Once the contract is signed it’s a zero-sum game: my gain is your loss,” said José Viegas, secretary general of the 1102 International Transport Forum.

He urged delegates, which included local authorities, concessionaires and contractors, to cooperate and not let lawyers take control.

One of the biggest changes in the tolling industry working its way through the system is European Union Directive 2014/23/EU which redefines the European model of a concession. In the new regulations, the concessionaire must accept the risk of failure. In tolling that often relates to unexpected difficulties during construction of the volume of traffic that use the new road. This introduces a degree of uncertainly which, Guy Chetrit of the 1054 European Investment bank, told the conference, means “PPPs [public-private partnerships] are not the right vehicle for funding toll road construction as a PPP needs certainty.”

For more information on companies in this article

Related Content

  • CECE Congress focuses on future of construction
    May 8, 2012
    The bi-annual CECE Congress was held in Spain when participants looked forward in a bid to see what will happen in the next ten years. Growth markets such as China, India and Brazil offer big opportunities to European construction equipment manufacturers. As companies, particularly those from China, start to expand outside their own countries the competition for business will increase, and it has been claimed that there is no such thing as 'the global market', rather it is the sum of hundreds, if not thousa
    Read More
  • Britain’s local roads face severe degradation warns National Audit Office
    November 2, 2012
    The British government’s decision to cut back hard on its highways maintenance spending plans will severely degrade the quality of local roads across the UK and risk driving up the long-term costs for the country’s hard-pressed local authorities, the National Audit Office has warned in a new report out this month entitled “Funding for local transport.” The NAO has also told the UK’s ministers that they must be much clearer about who they think should take forward the decision-making process once the devolut
    Read More
  • Directive on road infrastructure safety management – to improve mobility safely
    September 12, 2018
    Better signs and more compliance leads to safer roads, says Christophe Nicodème, director general of the European Union Road Federation in the first of a regular new series of columns from ERF The Third Mobility Package launched by the European Commission represents the final piece of the “Europe on the Move Agenda” towards a modernisation of transport policy adapting to new decarbonisation and digitisation commitments. The package is composed of elements impacting various transport elements, among which
    Read More
  • Michelin and IRF partner up to provide road statistics
    December 13, 2013
    Michelin has partnered with IRF to mark the global launch of the 50th Anniversary edition of the World Road Statistics. The World Road Statistics (WRS) have now been published every year since 1964. To mark this half-century of achievement, IRF has released a commemorative 50th Anniversary edition that compiles 12 years of data to provide a comprehensive statistical review of the evolution of international road and land transport from the dawn of the Millennium to the present day.
    Read More

Highlighted Content