LAW ON CONCESSION

(CONCESSIONS LAW)

 

(Published in the

Official Gazette of the Republic of Macedonia No. 42/93-1057)

(Unofficial Translation)

 

 

 

I. GENERAL PROVISIONS

 

 

Article 1

 

This Law prescribes the manner and conditions under which state properties of public interest for the Republic of Macedonia may be given for use upon approval (on concession).

 

 

Article 2

 

A right to a concession may be granted to domestic or foreign legal and physical persons (concessionaire), upon compliance with the Concession Law.

 

Concession Law is the law regulating the manner and conditions under which the state property under concession is to be used, i.e., it is the law giving permission for concession activities concerning state property of public interest.

 

 

Article 3

 

The Concession Law stipulates the following in particular:

 

- determines what state property is to be declared as of public interest and available for concession, i.e., determines approved activities in regard to the state property to be given for concession (concession activities);

- manner and conditions for use of the state property of public interest, i.e., for concession activities;

- conditions which the concessionaire is obliged to fulfill;

- beginning and duration of the concession, as well as possible cases of terminating concession agreements before due time;

- amount and way of concession compensation to be paid;

- fields in which concession activities are to be performed;

- possibility of declaring a public interest for compulsory concession;

- way of acquiring a concession, as well as purchase of concession;

- supervision over the concession activities, and

- conditions for improving the protection of environment and nature during concession activities.

 

 

Article 4

 

Issuer of concessions (concedent) is the Republic of Macedonia.

The Government of the Republic of Macedonia will grant a right to concession on behalf of the Republic of Macedonia and in accordance with the Concession Law.

 

 

Article 5

 

A right to concession cannot be granted for activities banned by the Concession Law.

 

 

Article 6

 

A compensation for concession activities is paid for.

Income made on basis of concession will be regarded as an income of the Republic of Macedonia.

 

 

Article 7

 

A right to concession may be either partially or completely transferred, under conditions prescribed by the Concession Law.

 

 

Article 8

 

A concession may not be used in a manner contrary to the law and international agreements ratified by the Republic of Macedonia.

 

 

Article 9

 

Changes made in concession acts will not influence relations agreed upon in concession agreement.

 

 

 

II. ACQUIRING CONCESSION

 

 

Article 10

 

A right to concession may be acquired either through competitive bidding auctions or on basis of a tender, if such a way to grant a right to concession is prescribed by the Concession Law.

 

 

Article 11

 

Conditions for competitive bidding auctions are set by the Government of the Republic of Macedonia, for each case separately and in accordance with the Concession Law.

 

 

Article 12

 

The Government of the Republic of Macedonia decides on whom a right to concession will be granted, at an open competition or on basis of a tender.

 

During the decision-making procedure of Par. 1 of this Article, all candidates participating in the procedure of the open competition or have submitted a tender will be regarded as clients (parties).

 

 

Article 13

 

The offer will consist of the following in particular:

 

- data on the applicants;

- description of the state property of public interest to be given for concession, i.e., the manner and goal of the concession activities;

- duration, conditions and way of exploitation of the property, i.e., exercising concession activities;

- amount of compensation to be paid for use of the state property, i.e., the concession activities.

 

 

Article 14

 

Tenders are submitted to the administrative agency in charge of issues concerned by the concession.

 

The administrative agency of Par. 1 of this Article is obliged to make public the tender within eight days from the date when the tender has been made public and allow other interested parties to submit tenders within a time limit, but no less than thirty days.

 

 

 

III. CONCESSION CONTRACTS

 

 

Article 15

 

On basis of the Concession Law and the decision to grant a concession, the Government of the Republic of Macedonia and the concessionaire sign up a concession contract.

 

 

Article 16

 

The concession contract consists of regulatory and contractual provisions.

 

Within the regulatory provisions of the concession contract, the Government of the Republic of Macedonia sets the way and conditions under which the state property of public interest is to be used by the concessionaire, i.e., performing the concession activities.

 

Within frames of the contractual provisions of the concession contract, the Government of the Republic of Macedonia and the concessionaire agree upon relations concerning the subject of the contract, in particular the following:

 

- way, time limit and guarantees to secure payment of the compensation;

- rights and obligations stemming from investments made by the concedent;

- obligations of the concessionaire in regard to data to be submitted to the concedent and concerning the activities and contingencies that might influence the concession activities in a manner and under conditions set by the regulatory provisions of the concession contract;

- way of supervision by the concedent;

- responsibility for non-respect of conditions of the contract;

- mutual relations in regard to possible damage caused by implementation or non-implementation the concession, i.e., concession activities:

- obligation for improving and protection of the environment and nature;

- way of settling disputes;

- termination of the concession contract and conditions for possible renewal of the same;

- transfer of objects and equipment of the concedent (purchase of concession) or a possible restitution following the termination of the concession;

- conditions under which a right to concession is to be taken away;

- termination of the concession contract.

 

 

Article 17

 

The concession contract is to be in a written form.

 

A concession contract not concluded in a written form is not legally binding.

 

 

Article 18

 

Prior to signing a concession contract, all property rights concerning the state property to be given for concession are to be clarified and settled.

 

 

Article 19

 

In case of a dispute during the conclusion of a concession contract, it will be settled by a court agreed upon in the contract itself.

 

 

Article 20

 

The concession contract is entitled to an international protection, secured by international agreements on investment protection.

 

 

Article 21

 

Concluded contract are registered by the administrative agency in charge of development issues.

 

The administrative agency of Par. 1 of this Article is obliged to submit a copy of the concession contract to the administrative agency in charge of foreign economic relations within eight days following the signing of the contract.

 

Another copy of the contract is to be also submitted to the state geodesy administration.

 

 

 

IV. TERMINATION OF CONCESSION CONTRACTS

 

 

Article 22

 

All relations between the concedent and concessionaire are terminated when:

- the concession contract expires;

- the concession is purchased by the concedent;

- the right to concession is taken away.

 

 

Article 23

 

The concession contract is terminated when:

- the time limit for concession expires;

- the contract is terminated before due time, and

- as a result of vis major.

 

 

Article 24

 

When a concession is purchased by the concedent, the concession relation is terminated and the concessionaire no longer performs the activity -subject of the concession. The concedent takes over all objects and equipment built or acquired by the concessionaire by performing the concession activity.

 

The concedent may purchase the concession only in cases precisely prescribed by the Concession Law, which determines the conditions and way of the purchase.

 

By exception, when it is of public interest as stated by the Concession Law , the purchase may be compulsory.

 

 

Article 25

 

The Government of the Republic of Macedonia may take away the right to concession from a concessionaire, should the latter fail to begin with the activity within the time limit agreed upon in the contract.

 

 

Article 26

 

The concessionaire is obliged to perform the concession activity - subject of the concession contract even during unfavorable conditions caused by vis major.

 

In cases described in Par. 1 of this Article, the concessionaire is entitled to an appeal for compensation with the concedent, for expenses made during the concession activity.

 

 

 

V. RESPONSIBILITY OF CONCESSIONAIRES DURING CONCESSION ACTIVITIES

 

 

Article 27

 

The concessionaire is responsible for all damages caused by his employees during the performance of concession activities to other legal or physical persons.

 

The concessionaire is also responsible for damages imposed on other legal or physical persons by a strike of the concessionaire’s employees.

 

 

 

VI. FINAL PROVISION

 

 

Article 28

 

This Law enters into force the eighth day after its publication in the Official Gazette of the Republic of Macedonia.