Concession Agreement L

The main reason for the application of a full concession contract is the tax application. In the 1980s, many ports (particularly service ports) were in a difficult financial situation: state-controlled, overgrown, poorly maintained, unfoturing in the market and often unable to offer even important port services. This has happened not only in developing countries, but also in many industrialized countries. However, in developing countries, the financial resources needed to modernize port facilities and provide severance pay for surplus staff were generally lacking. Concession agreements provided a timely solution: private investors provided the money to upgrade port facilities and often agreed to assume some of the debts of port personnel. This has freed up government resources for use in other parts of the economy. With all their advantages, concession agreements have a price, including the government`s surrender of full and complete control of port development. The duration of the agreement is a strategic issue. It depends mainly on the respective amounts of investments made or committed by the port authority and the concessionaire. In a rental port, standard leases, which involve limited investments in the dealer`s name, are usually 1015 years.

BOT-type agreements are generally concluded for a period of 2535 years with extension options. Owners` investments in construction and equipment often far exceed those of a port authority; Whether or not, both parties have an interest in having a mutually beneficial long-term relationship. This is particularly the case for the conclusion of a full concession contract with a BOT agreement. Short-term agreements (10 years or less) are suitable for tool ports or management contracts, but generally do not provide much security or stability to the port authority, nor do they provide an incentive for the dealer to improve performance or launch innovative operations. At the end of the concession period, facilities built on the site and all titles given to the operator under an agreement B (O) OT will be returned to the port authority. In some contracts, the land may have to be returned to its original state, which could mean that the operator will have to demolish structures and facilities built on the site during the concession phase. The equipment would be transferred or retained under contractual obligations; it may be compensated for the value of the book or market or removed from the website by the operator for sale or other use. Mandatory free transport of equipment to the port authority is not recommended due to the maintenance requirements of these facilities. If an operator knows that they may have to transfer equipment at the end of the concession period, the operator can reduce maintenance as much as possible in order to save money towards the end of the period. Marketing strategy: The first step is to ensure that a business profile reaches an appropriate number of relevant bidders (reasonable to create both competition and avoid high costs).

Comments are closed.