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Concessions in judicial system of the Republic of Croatia.

Abstract: Concession is a contract under which the state or municipal (town) government grants rights for exploitation of their enterprises or land under certain conditions, with the rights for prospecting of mineral raw materials, building of new enterprises, etc. Concession contract is most frequently bilateral legal transaction, with which the "Concessor" (hereinafter Grantor)) undertakes to grant certain economic rights to the Concessionaire for exploitation. The paper describes modalities of concession contract

Key words: concession, concessionaire, grantor

1. INTRODUCTION

Concession is a contract under which the state or municipal (town) government grants rights for exploitation of their enterprises or land under certain conditions, with the rights for prospecting of mineral raw materials, building of new enterprises, etc. (Klaic, 1981.). Concession contract is predominantly bilateral legal transaction, with which the "Concessor" (hereinafter Grantor)) undertakes to grant certain economic rights to the Concessionaire for exploitation. Here we speak about limitation of property rights for restricted or unrestricted time period, with retention of the right to termination of the contract.

2. SUBJECT MATTER OF CONCESSION

The subject matter of concessionaire's rights to exploitation are most frequently renewable and non-renewable natural assets, diverse communication infrastructure (roads, waterways, railway lines and similar), telecommunications, rendering of miscellaneous services etc. In cases when the financial gain, i.e. profit, is the exclusive reason for concession, we speak about economic concessions, which are governed by provisions of the trade law. If the concessionaire is the foreigner, then provisions of the International Trade Law are being applied. In cases when reason for granting of concession is not exclusively profit, but when crucial political arguments are involved, then we have to do with the so called political concessions (i.e. yielding of military bases, air bases, sea and river ports, passageways and similar). These relations are regulated by norms of International Public Law. However, the state realizes even in such cases some kind of revenues which serve fulfillment of needs for public consumption, very often for buying of weaponry and other strategic needs of vital state interest. Concession revenues being by their very nature non-fiscal are comparable to domain revenues, which lately represent their unique surrogate. From historical point of view they come about in periods of monopoly and state capitalism, when colonial state assumes the role of the concessionaire, i.e. their entrepreneurs in former colonies, which through realization of such modalities of exploitation of natural resources, gradually leads to neocolonialism

3. LAW ON CONCESSIONS

Prior to passing of the Law on Concessions Croatian legislation did not know the institute of concession. (Narodne novine--People's Gazette, 1992). Constitution of the Republic of Croatia and the Law on Concession do not define legal institute of concession.

The issue what can be subject of concession in the Republic of Croatia and under which conditions can this right be granted is regulated with Constitution of the Republic of Croatia; Law on Concessions; special laws and with different bylaw acts. Consequently, Law on Concessions represents by its character lex generalis, because it regulates generally the issue of concessions in Republic of Croatia. On the other hand, each single concession is regulated separately by special law, so that every law on its own constitutes by its characteristics lex specialis.

In Croatia for example some of special laws dealing with concessions are: Law on Telecommunications, Law on Roads, Law on Agricultural Land, Law on Hunting, Maritime Law, Law on Free Zones, Law on Public Roads and other laws. Besides laws, bylaw acts also deal with regulation of concessions, i.e. in the field of telecommunications there are Statute on Use of Radio Wavelengths and Distribution of Radio Frequencies, Statute of Concessions in Public Telecommunications and Statute on Compensation Fee in Public Telecommunications and Modalities of Payment (Narodne novine, 1995). As already mentioned, Constitution of Republic of Croatia does not explicitly mention concessions. However, it speaks about goods of vital importance for the state, i.e. speaks about their exploitation (Article 52): "Sea, sea shore and the islands, waters, air space, mineral raw materials and other natural wealth, but also land, forests, floral world and the wildlife, together with other parts of nature, immobility and artifacts having special cultural, historic, economic or ecological significance, being determined by law to be of special interest for the Republic of Croatia, are put under state's protection. The Law regulates how the goods of interest for the Republic can be used and exploited, by authorized proprietors and the owners, as well as way of remuneration for limitations being imposed upon them." Law on Concessions sets up that concession deed entitles to economic exploitation of natural resources and other goods, and gives right to conduct business of general concern for the Republic of Croatia. Simultaneously law establishes ban on acquiring of concession for exploitation of forest estates and other estates established by special law.

4. CONCESSION GRANTING REQUIREMENTS

Concessionaire may be every domestic and foreign legal or physical person engaged in business activities. Time period for which concession may be granted is limited up to 99 years, with bottom line not being determined.

The government submits proposals needed for decision making in connection with granting of concessions to Croatian Parliament (Sabor), only after providing of opinion from municipality, town or county authorities on which territory rights for economic exploitation of goods or conduct of services are being granted. Decision making on granting of concession is preceded by completion of the public tendering proceeding, publishing of invitation to tender and upon submittal of request (only in cases when foreseen with the special law).

The government shall assess business reputation of the bidder prior to rendering of concession deed, his abilities for realization of concession, technical and financial favorability of the bid and the its effect on protection and preservation of natural environment. The Croatian Parliament is entitled to render decision on granting of concession; however it may entitle the Government of the Republic of Croatia to decide about granting of certain concession.

Supervision of implementation of concession contract is not regulated by Law on Concessions, but with the special law containing provisions on concessions.

Concession fee paid for utilization of certain concession goes into state budget of the Republic of Croatia, i.e. into budgets of units of local and regional self-government. Law on Concession does not determine the height of fee for utilization of certain concession, which matter is predominantly regulated by concession contract.

The Ministry of Finances keeps unified register, listing all concession contracts, while contracts referring to real estates are registered in the Land Registrar of the authorized Municipal Court.

In the Republic of Croatia the role of Grantor can be taken by state, i.e. units of local government and self-government. From this aspect concessions in the Republic of Croatia are categorized as large, medium and small.

5. CONCESSION GRANTING FOR CONDUCTING OF RADIO BROADCASTING ACTIVITIES

Granting of concession for conducting of radio broadcasting activities shall be explained on the example of Media Centre "Glas Slavonije" d.d. Osijek, i. e. "Slavonskog radija" registered as joint stock company in October 1993, company having main scope of activity: communication in the field of press and electronic media communication.

Proceedings for granting of concession for conducting of radio broadcasting activities on the level of Osjeeko-baranjska County in the case of Media Centre "Glas Slavonije" d.d. Osijek encompassed the following stages: announcement of invitation to submit bids for concession granting in the field of radio broadcasting on the part of Ministry for the Sea, Transport and Telecommunications, i.e. Council for Telecommunication, Licenses for Procurement and Installation of Radio Station; submittal of tenders for granting of concession for radio broadcasting on the level of Osjeckobaranjska County; technical inspection on fulfillment of conditions for radio broadcasting on the part of Commission of Ministry of the Sea, Transport and Telecommunications, provision of License for Operation of Radio Broadcasting station by Ministry of the Sea, Transport and Telecommunication; signing of concession contract between Grantor and the Concessionaire.

Council for Telecommunication shall obligatory and openly collect tenders or announce public invitations for tenders granting concessions in the field of radio broadcasting activities, all in accordance with Article 14, paragraph 1 of the Law on Telecommunications. Invitation to granting of concessions for operation of radio broadcasting station must obligatory contain: definition of territorial level at which the concession is being granted (county, town); fee to be paid at submittal of request for provision of tender information and the bid bond to be paid at the time of tender submittal. Ministry of the Sea, Transport and Telecommunication issues in advance the license for procurement and installation of radio broadcasting station, pursuant to provisions in Article 23, paragraph 1 of the Law on Telecommunications. The content of the license form is set beforehand by the minister responsible for the area concerned.

Media Centre "Glas Slavonije" d.d. Osijek as concessionaire was obliged to submit with his tender for granting of radio broadcasting concession for the region of Osjecko baranjska County to the Grantor, i.e. Ministry of the Sea, Transport and Telecommunication, i.e. Council for Telecommunication the following documentation: Registration at Trade Court Register in Osijek No. Tt-95/2402-2; List of assets with December 31st, 1996 which proves they have ground of 2521 [m.sup.2] size, land register No. 5428 k.o. Osijek, recorded in Land Register Insert No. 14451 being in possession of Media Centre "Glas Slavonije" d.d. Osijek; Extract from Institute for Payment Transactions, the so called BON-2 from December 16th, 1996 , from which it is visible that the concessionaire has at his disposal the required funds for opening and operation of radio broadcasting station; Program schedule of the concessionaire pursuant to provisions of the Law on Telecommunications; List of personnel which proves that the concessionaire has got required personnel, and as attachments, contract of employment for his staff and extracts of stock-taking lists for production and broadcasting of radio programs may be also submitted. Commission of the Ministry of the Sea, Transport and Telecommunication has conducted, pursuant to provisions contained in Article 14, par. 9 of the Law on Telecommunication, technical inspection of the premises and technical equipment of the concessionaire (Media Centre "Glas Slavonije" d.d. Osijek) on the basis of submitted documentation for acquiring of concession. Commission drew minutes of meeting of the conducted technical inspection, signed by the authorized representative of the concessionaire and the grantor. Media Centre "Glas Slavonije" d.d. Osijek as concessionaire was obliged to submit within time period of eight days since the day of inspection his request for issue of the License for operation of radio broadcasting station, pursuant to Article 30, par. 2 of the Law on Telecommunication.

The content of the license form is prescribed by the minister responsible for the area concerned. Pursuant to concession deed of the Council for Telecommunication, the ministry concludes the concession contract, in case that technical inspection proves that the concessionaire fulfilled conditions for start up of radio broadcasting operation, i.e. after acquiring of the License for operation of radio broadcasting station.

6. CONCLUSION

Law on concessions as lex generalis is very concise, because most part of legal regulations have been left to other legal regulation forms, which as lex specialis put in order problems of specific concession relations. Due to expected entry of the Republic of Croatia into EU, and within process of harmonization of national, Croatian legislature, the need for extension of this law has been on the agenda, so as to bring this segment of national legislature closer to European legal standards. But, in spite of this "deficiency" there is no feeling of legal vacuum regarding establishment and realization of single concession relations in the Republic of Croatia.

7. REFERENCES:

Klaic, B.(1981) : Foreign Words Lexicon, Publisher: Matica Hrvatska, Zagreb--

Maritime Code, People's Gazette No. 17/1994, 74/1994., and 43/1996.;

Statute on Utilization and Granting of Radio Broadcasting Wavelengths--(1995) People's Gazette No.18/1995;

Statute on Concessions in Public Telecommunication, (1995) People's Gazette No.18/1995;

Lows of the Republic of Croatia (1990-2001) People's Gazette (Public; Roads; Hunting; Agricultural; Land Free Zones; Telecommunication; Concessions; Obligations)
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Author:Brekalo, M.; Petricevic, N.
Publication:Annals of DAAAM & Proceedings
Article Type:Report
Geographic Code:4EXCR
Date:Jan 1, 2005
Words:2015
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