MINISTRY OF INTERNATIONAL ECONOMIC RELATIONS Dragan Penezic, Assistant Minister

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MINISTRY OF INTERNATIONAL ECONOMIC
RELATIONSDragan Penezic, Assistant Minister

• Concessions in the
• Republic of Serbia
• Belgrade, June 2006.

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Concessions Public Private Partnership

• - Legal Framework
• - Procedure of Granting Concession
• - The Role of Concessions Unit within the
• Ministry of International Economic
• Relations

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The Law on Concessions

• The Law on Concessions (Official Gazette,
  No.55/2003, May 2003) provides clear legal
  framework for investing into public utilities and
  activities of general interest, with an aim to
  improve quality and to increase efficiency of
  public services
• What is a Concession ?
• Concession is the right to use natural
  resources and assets of general use or to perform
  activities of common interest, which a competent
  state body (Concedent) concedes to a domestic or
  foreign company (Concessionaire) for a limited
  period of time, under the terms of the Law for
  payment of a concession fee.
• Concessions also include B.O.T.
  (build-operate-transfer) systems.

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The Law on Concessions

• What can be object of a Concession ?
• Research and exploitation minerals, natural
  resources (ores), mineral deposits
• Construction, renovation, maintenance and use
  of
•   - various water supply facilities
•   - roads
•   - public railway infrastructure
•   - air traffic facilities
•   - river traffic facilities and ports
•   - telecommunication facilities
•   - oil pipelines, gas pipelines and other
  gas and oil facilities
•   - public utilities
•   - power-generating and heating facilities
•   - river and lake banks
•   - medical institutions
•   - sports and recreation facilities, sports
  fields and areas
•   - tourist facilities and infrastructure
• - using thermal springs.
• other activities specified by the Law as
  activities of general interest.

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The Law on Concessions

•   Procedure of granting the concession
• A competent ministry, a competent body of an
  autonomous province or a competent body of local
  self-government submits a proposal for granting a
  concession to the Government of Serbia.
• An interested entity submits an initiative for a
  concession to the competent bodies.
• The Government shall give its opinion on the
  proposal within four months of Submission

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Procedure of Granting the Concession
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Proposal to Adopt Concession Act

• Proposal to Adopt Concession Act for
  construction, maintenance and utilisation of
  public utilities is prepared by competent body of
  Local Self-Government accompanied by the opinion
  of competent ministry and submits it to the
  Government.
• For all other objects of concession, The Proposal
  is prepared by competent Ministry, within six
  months after the date of its being notified of
  the Governments and/or National Assemblys
  intention.

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The Concession Act

• The Concession Act is to be adopted by the
  Government and afterwards published in
  Official Gazette
• The Concession Act defines
• Object of concession
• Duration of concession
• Basic elements of public tender
• Requirements that concessionaire has to fulfil
• Criteria for choosing the best offer
• Operating mode (ways of providing services)
• Environmental conditions
• Types of financial guaranties
• Concession fee
• Other elements significant for regulating the
  mutual rights.

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The Concession Contract
Written approval of Government
Concessionaire
Concessionaire
Competent body of local self-government
Government of Republic of Serbia
Local concessions

• The Contract shall be concluded within the period
  of 60 days from the effective date of decision.
  The Government appoints the Negotiation Committee
  that shall determine the contents of the
  Contract.
• The Contract is concluded between the Government
  and Concessionaire.
• If the concession object is the construction of
  public utility facilities intended for performing
  utility services, the Contract shall be concluded
  between the concessionaire and the competent body
  of the local self-government with previously
  obtained written approval of the Government.

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Concessions Department within the MIER

• " The Concessions Department is in charge of
  activities relating to analysis and proposal of
  measures to stimulate concession activities
  monitoring of activities undertaken by public
  administration bodies and organizations and
  implementation of consultations relating to the
  concession granting procedure collection,
  analysis and publication of data relating to
  concession activities, as well as other
  activities laid down by the law. " (Act of
  Internal Organization in the Ministry of
  International Economic Relations, May 2005)
• Assistant Minister
• Concessions follow up executive
• Attracting concessions executive
• Analysis executive
• Department Secretary

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Legal Framework for the Activities of Department

• Law on Concessions
• Legal regulatory rules covering the fields of
  foreign investment, planning and construction,
  public utilities, roads, companies,
  privatization, bankruptcy, expropriation
• As a type of public private partnership,
  concessions have an impact on the FDI increase,
  increase of employment and improvement of living
  standard, regional development as well as it
  brings new technologies and new markets.

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Concession Projects Current Situation

• 4 concessions in the field of mining have been
  granted
• (optimal results)
• Project of Highway Horgos Pozega in the phase
  of final collection of tender documentation
• Project of City of Belgrade solid waste facility
  still on evaluation

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www.mier.sr.gov.yu

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