Core principles

Core Principles for a Modern Concession Law (MCL)

Since its creation in 1991, the EBRD has worked to assist its countries of operations in their transition to market economies. It has long been understood that an essential component for the development of a market economy, particularly in early transition countries, is the presence of a sound legal framework for Public Private Partnerships and for concessions in particular. 

The EBRD regularly conducts assessments and surveys to measure the extensiveness and effectiveness of concession legislation in its countries of operations. These laws are measures not against arbitrary or abstract principles but, rather, against international standards and best practices as articulated by, among other things, the UNCITRAL Legislative Guide on Privately Financed Infrastructure Projects adopted in 2000. The EBRD fully appreciates that the nature and content of concession legislation will vary from jurisdiction to jurisdiction and must in fact do so to accommodate the rich variety of legal traditions across its countries of operations.  Nevertheless, this legislation needs to comply with the core principles of international standards and best practices as it is international standards that external actors are most likely to apply when determining whether or not to invest in a given country.

This need has led the EBRD to define a set of 10 core principles for a modern concession law (MCL). By virtue of being “core” principles, these cannot be exhaustive but, rather, are intended to form the foundation of an MCL. These principles are based on international standards and best practices and therefore can assist in assessing a country’s MCL and in identifying the need for reform.  These principles are meant as guidelines only and speak more of the results to be achieved rather than the process by which to achieve them.  Invariably, exceptions to these principles may have to be made in the context of a given country’s legal system. 

The statement of Core Principles  (0.1Mb) is also available in French  (0.1Mb) and in Russian  (0.1Mb).

The paper entitled “EBRD Core Principles for a Modern Concessions Law – selection and justification of principles  (0.1Mb)” discusses in detail the purposes of generating a set of Core Principles and their origins, and contains an explanation of each of the principles and the international and regional documents drawn upon in elaborating them. It summarises and explains the Core Principles and refers to sources used in the process of developing them. If you have any comments or questions regarding this statement, please contact the EBRD’s concessions specialist, Mr. Alexei Zverev, on +44 0207 338 6370 or at zvereva@ebrd.com.