Expiring concession agreements remain a perennial issue. This is a legally complex matter and poses fundamental questions for the municipalities concerned, including first and foremost the question of how to ensure a legally sound procedure. The fourth edition of the joint documentation “Auslaufende Konzessionsverträge” (expiring concession agreements) continues to provide assistance in that regard in a tried and tested manner. The documentation is a result of the cooperation between BBH, DStGB – Deutscher Städte- und Gemeindebund (the German Association of Towns and Municipalities) and the company BET.
Approximately 20,000 easement agreements are estimated to be in place in the electricity and gas sector in Germany. The roughly €3.2 billion which the municipalities collected in concession fees from these agreements in 2019 are urgently needed in the communities. Especially in challenging times such as the coronavirus pandemic, where municipalities experience a sharp fall in vital tax revenue, reliable income such as the concession fee is indispensable for municipal investments in climate protection and infrastructures.
With the energy and climate transition gaining momentum at the local level, it is becoming increasingly clear that a cross-sectoral design of local energy networks will become more important to ensure their successful implementation. Helping to make this happen is one of the core areas of municipal responsibility with regard to the provision of services of public interest. This documentation aims at providing guidance also in that regard enabling these fundamental issues to be part of the process of decision-making and weighing of interests at local level.
Most recently, the legislator made major amendments to the legal framework for concession award procedures in 2017. Even though not all concerns voiced at that time came true, the concession award procedure as such has become more complicated over the years and is still associated with many legal uncertainties for the parties concerned. In the future, action will also have to be taken with a view to simplifying and optimising the legal framework and thus restoring the balance between effort and revenue with regard to concession awards, especially for smaller municipalities.
Becker Büttner Held is a leading provider of advisory services for energy and infrastructure companies and their customers. Energy and supply companies, particularly public utilities, municipalities and local authorities, industrial companies and international groups are among its core clients. BBH advises these and many other companies and organisations in all legal matters and also assists them with business and strategic advice.
Prof. Dr. Ines Zenke
Tel +49 (0)30 611 28 40 - 179