Represented a client’s interests in a dispute over a concession agreement

The practice team defended the client’s interests in a dispute with the prosecutor’s office which filed a lawsuit seeking to have a concession agreement for the construction of a healthcare centre declared void. In the opinion of the prosecutor’s office, the concession agreement violated a number of statutory requirements (including, among others, requirements of civil and budgetary laws, and laws regarding concession agreements and compulsory medical insurance), and the public interests of the region, while it was alleged to have been concluded in manifest violation of public order and with the abuse of a right. Our lawyers provided legal assistance in connection with the dispute in courts of all levels. Legislation regarding concession agreements and the practice of applying it are still poorly developed and many issues need to be regulated. The prosecutor’s office challenged those conditions of the concession agreement which had already become customary and widely accepted practice.

As a result, the court sided with the client. Had the concession agreement been declared void this would have had a detrimental effect on the development of this institute and would have far-reaching repercussions for the whole sphere. Within the framework of the project, important issues were addressed: compensation by a concession grantor of a portion of expenses (to which extent the portion of expenses might be assigned to the concession grantor); what the term ‘creation of a facility’ implies and if a concession grantor may finance design and survey work or construction only; whether a public entity may select a model for implementing such projects and the criteria for such selection: concession or public procurement under Law No. 44-FZ. Moreover, the question was considered regarding the boundaries of the controlling and supervising powers of the prosecutor’s office which enable it to interfere with business operations of entities that are subject to supervision and the competence of other state authorities.
The project was a matter of principle for the client’s business because its successful resolution would allow the client to build up its portfolio of concession projects in the sphere of healthcare: it is planning to embark on similar projects in several other regions.