Click on the quick links to read some of our recent case studies:
1. Imagine if old rivalries became new opportunities >
2. Keeping procurements on track >
3. Connecting countries >
4. Pioneers in complex finance leasing >
5. Building a sustainable future in rail >
6. Working with MerseyTravel >
Imagine if old rivalries became new opportunities
OUR RESPONSE: This alliance does not involve any crossownership, and demands an overall master collaboration agreement including many parallel workstreams. Fiona Ghosh has brought together 30+ AG lawyers operating across different jurisdictions with expertise in areas as diverse as arbitration, compliance, data management, energy, information security, IP, product liability plus deep expertise in complex cross-border commercial and technology transactions.
IMPACT: This deal represents a mass convergence of the industry. VW and Ford are harnessing collective technology, resources, and innovation capabilities to grow market share in a way which would have been prohibitive working independently both in terms of time and cost. Ford will become the first additional automaker to utilise Volkswagen’s dedicated electric vehicle architecture and Modular Electric Toolkit – or MEB – to deliver a high-volume zero-emission vehicle in Europe starting in 2023. In short, the electrification of new vehicles by Ford and VW is a game-changer for the auto sector, and has the potential to accelerate the transfer from hydrocarbon usage to zero carbon.
SCALE: VW and Ford in combination are expected to deliver in excess of 20 million vehicles. Ford expects to produce 600,000+ European vehicles utilising VWs MEB platform over six years, with a second all-new Ford model for European customers to follow. Volkswagen started developing its MEB architecture in 2016, investing approximately $7 billion and plans to build approximately 15 million cars in the next decade.
Keeping Procurements on Track
THE PROJECT: HS2's £1.3 billion procurement for a Construction Partner for the design and delivery of Old Oak Common (OOC) Station, a transport super-hub and one of the biggest brownfield regeneration projects in Europe. OOC Station is one of two London stations to be constructed as part of phase one of the HS2 line (a new high speed railway network).
OUR ROLE: Acting for HS2 in a claim brought by Bechtel, an unsuccessful bidder who claimed that HS2 had breached its obligations under the Utilities Contracts Regulations 2016. Proceedings were issued in February 2019 and concluded with a 3 week trial in October 2020 before Mr Justice Fraser in the Technology and Construction Court (QBD), with judgment finding in HS2's favour handed down in March 2021.
Early on in the proceedings, we made an Application to Lift the Automatic Suspension allowing HS2 to award the contract to its winning bidder (BBVS), given the impact that the delay of being unable to award would have on the HS2 project overall, including the timeline and costs for the building of the entire project, and the public interest. The sensitivity surrounding the details of this project, both the project timeline and the detail contained within the bids of all bidders, meant it was necessary for complex confidentiality rings to be set up. The majority of work in preparing this case for trial was undertaken during the Covid-19 pandemic, resulting in interim hearings being held remotely and the trial then proceeded on a hybrid basis across three courtrooms in the Rolls Building.
Aside from the main procurement claim, significant commercial issues also arose in connection with the proceedings, including the importance of the project to the UK transport system, the relationship between HS2 (as an arms-length non-departmental public body) and the Department for Transport, the impact of the Oakervee review upon the project and the 2019 General Election.
MAKING A DIFFERENCE: This matter required quick thinking, both contentious and non-contentious procurement expertise, and a lot of preparation (not least because of the wide scale of Bechtel's challenges HS2 had to call 15 witnesses). The determination of both the legal team and the HS2 team saw a successful judgment for HS2, with the 152 page judgment providing helpful analysis for authorities, utilities and bidders on a number of aspects of public procurement processes.
Connecting Countries
THE PROJECT: At 18km long and €5bn in value, the Fehmarnbelt Tunnel is one of Europe’s biggest infrastructure projects. Once completed it will be the longest immersed road and rail tunnel in the world, creating a new link between Denmark and Germany. But getting the work off the ground (or under the sea) has been a hugely complex legal challenge.
OUR ROLE: Working for the Danish Government owned company, Femern A/S. we helped design the bidding process to select contractors. The sheer size of the project meant several construction contracts were let, with bidders comprising consortiums from around the world. AG prepared bespoke contracts, including mechanisms to ensure different contractors work collaboratively. The contracts are in English, and clarity of expression was key, given the involvement of parties from many different jurisdictions. All contracts have also been designed to “speak to” each other – using the same provisions for ease of contract management in case future disputes involve several contracts – despite the diverse subject matter ranging from dredging to concrete production to electrical installations.
MAKING A DIFFERENCE: This project required flexibility and real imagination. After many years of legal groundwork, construction of the tunnel finally commenced in 2020 with completion targeted for 2028. We know a long road (and plenty of legal legwork) lies ahead – but there’s definitely light at the end of the tunnel.
Pioneers in complex finance leasing
THE PROJECT: In order to reduce the acquisition cost for the financing of rolling stock, the German authorities (Aufgabenträger) in 2012 started to include the possibility to support the acquisition of rolling stock by offering either public guarantees or warranties procuring continued use of the trains upon the termination of the relevant concession.
OUR ROLE: We were representing Netinera Deutschland GmbH as the first provider of transport services in Germany to accept the offer to financially support the acquisition of the trains. The investment volume exceeded EUR 500 million.
MAKING A DIFFERENCE: This project is seen as the first project in Germany in which state guarantees were embedded in highly complex lease structures. We entered new legal territory and created a true piece of pioneer work that served and still serves as blue print for many other transactions that followed this project.
Building a sustainable future in rail
THE PROJECT: In response to the Government’s commitment to rid the rail network of diesel only-powered trains by 2040, Hitachi Rail is working to build a more hybrid environment, investing in more sustainable technologies and rolling stock solutions.
OUR ROLE: We have advised Hitachi Rail on their successful bid for four new-build rolling stock procurements worth over £1bn which involved the supply and maintenance of their innovative bi-mode AT300 trains.
MAKING A DIFFERENCE: Our broad policy understanding and significant expertise in sustainable transport means we were well placed to advise Hitachi Rail on achieving their procurement objectives. The bi-mode technology used on Hitachi Rail’s AT300 models means the trains can run as sustainably as possible. They run on electric power wherever the network is electrified, only using diesel power where there are gaps in electrification infrastructure. The modern diesel engines are significantly lower emission than the previous fleets they produced. Crucially, this is cutting carbon dioxide emissions.
In addition, their regenerative braking capabilities create additional electricity, feeding back power into the overhead wires. This is reducing the amount of electricity that Network Rail needs to draw from power stations. So through working with Hitachi Rail, we were able to support them in achieving their commercial objectives – and the planet is benefiting too.
Working with MerseyTravel
THE PROJECT: The Addleshaw Goddard Bus Services Team are currently advising Merseytravel on its appraisal of how bus services are offered within the Liverpool City region through the development of a franchising assessment in accordance with HM Treasury and DfT guidance. This project has consisted of an in depth analysis of the options now available under the Bus Services Act and a drill down into the risks, benefits and savings of each option, being franchising, enhanced partnership and a reference case of the current voluntary partnership arrangement with Arriva and Stagecoach which we also helped to develop.
OUR ROLE: In developing the franchising assessment, we have worked with technical and financial consultants to support Merseytravel to further develop its vision for bus and set out a number of bus interventions that support the delivery of the bus vision. We have also undertaken an assessment of the ability of the three main options shortlisted at Strategic Outline Case stage (continuation of the bus alliance, development of an Enhanced Partnership, and development of a franchising scheme) to successfully deliver the bus interventions and wider bus vision. This has involved developing what each of the Enhanced Partnership and franchising scheme delivery options will comprise and a detailed assessment of the financial, commercial and management implications of the different options (including the use data obtained under the Bus Services Act) to support the selection of a preferred option for the Liverpool City Region Combined Authority.
As part of our analysis, we have assessed whether the improvements Merseytravel desires to bus services can be delivered under the different options and we are determining how the different options can act as enablers to the Liverpool City Region's Combined Authority integrated strategy.
From a Financial Case perspective, following the Bus Services Act and related Guidance, we have developed a long-term affordability analysis, including developing a financial model to determine the year-by-year cost (capital and revenue) and affordability of delivering the services, network, fleet and ticketing improvements desired by Merseytravel. For example, this has involved developing outputs for scenarios in which Merseytravel hold the revenue risk, and stress testing the sensitivity of Merseytravel’s net income/expenditure under different operating cost/ farebox revenue scenarios.
We have also developed the commercial model for the shortlisted options, and assessed the contracting and procurement implications of undertaking any given option. In particular, this has involved a detailed assessment of the commercial arrangements surrounding fleet, depots, pensions and other key issues, as well as potential implications of different approaches for levels of competition in the bus market.
We are currently assessing the impact of covid-19 on the assessment.
MAKING A DIFFERENCE: We have supported Merseytravel and the Combined Authority by giving briefings on the process and emerging options and producing presentation slides for a number of different audiences including the Metro Mayor. We have also provided advice on how best to mitigate challenge risk, supported the development of a clearly documented process, advised on how to protect legal privilege and reviewed public statements for consistency with the business case work and Merseytravel policy.