Barely two years after the NDA-1 cabinet revised the model concession agreement (MCA) for public-private partnership (PPP) projects with large port funds, the Ministry of Navigation is back on the drawing board in an attempt to reshape the key document that defines the terms of a port contract. Concession agreements are sometimes used to exploit other nations. For example, foreign countries and companies forced China to make various concessions in the 19th and early 20th centuries. These concessions have given foreign companies the right to develop and operate railways and ports within China. In addition, citizens of other countries have often appreciated extraterritoriality as part of their concessions. Extraterritoriality meant that foreign laws and tribunals settled disputes between Chinese and foreigners in concessions. Of course, the decisions of these courts have tended to oppose Chinese businesses and consumers. On a smaller scale, suppliers work under concession contracts awarded by local governments, businesses or other property owners. This activity may include restaurants and retail outlets at major airports, vendors at public fairs or the sale of food and beverage stalls in public parks. Example 5: Brazil – Mining-Related Railway Concession – Concession agreement between the Brazilian state and a consortium of several mining companies.
The concession agreement grants the concession to the concession for a 30-year concession for the development and operation of a 1,674 km rail line, which serves as a freight link to the main ports in the region. The concession agreement provides for access to a certain volume of local passenger transport (9.1 XX). The dealer is also required to exploit “mutual traffic” (i.e. to grant reciprocal access rights to other rail operators). If the dealer is unable to operate “mutual traffic,” it must enter into track access agreements with third-party users. These contracts must be subject to the agreeing authority in order to avoid the abuse of economic power (9.1 XXII). Concessions (or franchise agreements) may also be relevant to the broader theme of access to the track, where they require the dealer to grant access to other operators for the payment of an access fee. However, the implementation of MDBs also has several drawbacks. Often, the format and language of WABs are copied without proper consideration of the specific implications of each project. The structure of the WAB is rigid. Concession contracts are often complex and long-term and it is not possible to anticipate all the risks that may arise during the execution and operation of the project being implemented. In these circumstances, the lack of a flexible approach undermines the interests of private parties.
A rental agreement is a property award of a specific description of the land or other property against a specific price and payment agreement. On the contrary, the concession under a concession agreement is a licence for the use of the property for a specific purpose, once the objective is achieved, all those rights must be returned to the grantor. In this process, the right to manage and control the property is maintained by the owner. The terms of a concession contract depend largely on his desire. For example, a contract to operate a food concession in a popular stadium cannot offer much to the dealer in the kind of incentives. On the other hand, a government that wants to attract mining companies to an impoverished area could offer significant incentives.
