Concession contract

Success Problem

What is the Concession Contract in contrast with the Mandate Contract and/or Commission Contract?

Impact

Concession contract or concession agreement (e.g. for construction or building works) is contract with legal adequate consideration in the form of the right for investor to use the finished construction or building during an aggreed period of time. The public procuror and the concessionaire negotiate the content of this right, containig usually the right to use the finished building for the concessionaire’s business during the aggreed period of time. After this period the construction or building becomes the procuror’s ownership.

Recommendation

In the case of a public service concession, a private company enters into an agreement with the government to have the exclusive right to operate, maintain and carry out investment in a public utility (such as a water privatisation) for a given number of years.

Category

• Procurement
• Negotiation