Consortium / Intergovernmen-Tal Corporations and Consor-Tiums

Intergovernmental consortiums and corporations are quasi-business associations formed to provide services, arrange financing, or operate certain enterprises. The involvement of more than one state or institution helps expand the financial and administrative resources available to the entity and, in some cases, permits services or products to be distributed on a larger and more efficient scale. Various banks, for instance, may form a consortium with a government to finance a major development project too large for one bank to finance alone. The terms of the agreement forming the consortium or corporation will determine the reciprocal rights and duties of the members of the entity. While in practical terms there may be little difference between an intergovernmental consortium or corporation, the usual ad hoc nature of a consortium suggests its use for individual projects with a definite completion schedule. The widespread use of the corporate framework in other circumstances indicates that the corporate form works well when the entity must provide services over an indefinite period of time. The corporate structure, with its separate board of directors and management, can also protect the independence of the entity from direct political control and may help facilitate access to private financial markets.