Concession Contracts Regulations

UK regulations governing public sector concession contracts where operators receive payment primarily through exploitation of works or services, transposing EU Directive 2014/23/EU.

How it works

The Concession Contracts Regulations 2016 (SI 2016/273) establish the legal framework for awarding concession contracts by UK public sector contracting authorities. These regulations apply when the contract involves transferring operational risk to the concessionaire, who receives payment primarily through exploiting the works or services rather than direct payment from the contracting authority.

Concession contracts differ from standard public contracts because the operator assumes demand or supply risk. The regulations set procurement thresholds (currently £4,733,252 for works concessions and £378,660 for services concessions), below which simplified procedures apply. Above these thresholds, authorities must follow structured award procedures including publication of contract notices in Find a Tender and comply with specific timescales.

Key requirements

Contracting authorities must ensure transparency, equal treatment, and proportionality throughout the procurement process. The regulations require publication of concession award notices and mandate minimum time limits for receipt of applications. They also establish grounds for excluding economic operators and set out modification rules for existing concessions.

The regulations permit negotiated procedures without prior call for competition in specific circumstances, such as extreme urgency or when only one operator can perform the concession for technical reasons.

Why it matters

These regulations provide legal certainty for major infrastructure and service delivery projects where private operators invest capital and assume commercial risk. They balance the need for competitive procurement with the flexibility required for complex, long-term concession arrangements. Compliance ensures legal challenge protection whilst maximising value for public money through effective risk transfer to the private sector.