Concession Agreement Template and Key Clauses (2026)

What is a concession agreement, and when do you need one? A concession agreement is a long-term contract in which an authority (usually a government body, but sometimes a private owner) grants a concessionaire the right to build, operate or use an asset, provide a service, and earn revenue from it for a fixed concession period, after which the rights end or the asset passes back. It is the legal instrument at the heart of infrastructure projects such as roads, ports, airports and power, but the same structure governs retail concessions in an airport terminal, a mining concession, or the right to run a facility on someone else's land. You need one whenever one party grants another the long-term right to operate an asset or service and collect the revenue it generates, in exchange for building, investing, paying a fee, or all three. The defining features are time and revenue: the concessionaire gets a defined period and a defined way to earn money (tolls, user charges, a share of revenue, or a fixed annuity), and the authority keeps ultimate ownership and the right to take the asset back in good condition at the end. A concession agreement is close cousin to a public-private partnership (PPP) agreement and a build-operate-transfer (BOT) agreement, but it is the broader instrument: every BOT project uses a concession agreement, yet not every concession is a BOT or even a PPP. This page is about the concession agreement itself. (Last verified October 2026.) This article is general guidance, not legal advice. Concession projects engage public-procurement, sector-regulatory and sometimes constitutional rules that vary by jurisdiction, so have qualified counsel review any agreement before you rely on it. ## Concession agreement template Copy the block below and fill the bracketed fields. A real concession agreement for a large project runs to hundreds of pages with technical schedules; this captures the core clauses. ```

CONCESSION AGREEMENT This Concession Agreement ("Agreement") is made on [DATE] BETWEEN: [AUTHORITY NAME], [address] (the "Authority") AND [CONCESSIONAIRE NAME], [address] (the "Concessionaire") 1. GRANT OF CONCESSION The Authority grants the Concessionaire the exclusive right to [develop, finance, construct, operate and maintain / operate] the [Project: asset / facility / service] at [site], and to earn revenue from it, for the Concession Period, on the terms of this Agreement. 2. CONCESSION PERIOD The Concession Period is [N] years from the [Appointed Date / commercial operations date], unless extended or terminated under this Agreement. 3. SCOPE AND SPECIFICATIONS The Concessionaire will deliver the Project to the specifications and service levels in Schedule [A], and operate it to the performance standards in Schedule [B]. 4. CONCESSION FEE AND REVENUE The Concessionaire will [pay the Authority a concession fee of [AMOUNT / %% of revenue] / be entitled to collect [tolls / user charges / a revenue share / an annuity of [AMOUNT]]], as set out in Schedule [C]. [Revenue-sharing, premium or grant / viability support: [detail].] 5. OBLIGATIONS OF THE AUTHORITY The Authority will provide [the site / right of way / approvals / clearances] by the dates in Schedule [D] and will not grant a competing concession that undermines the Project, except as stated. 6. OBLIGATIONS OF THE CONCESSIONAIRE The Concessionaire will finance, deliver and operate the Project, meet service levels, maintain the asset, carry required insurance, and comply with applicable law. 7. RISK ALLOCATION Risks are allocated to the party best able to manage them, as set out in Schedule [E] (construction, demand/traffic, financing, change in law, force majeure). 8. CHANGE IN LAW AND FORCE MAJEURE If a change in law or a force majeure event materially affects the Project, the parties will adjust [the Concession Period / tariff / compensation] per the mechanism in clause [X]. 9. PERFORMANCE SECURITY AND PENALTIES The Concessionaire will provide performance security of [AMOUNT]. Failure to meet service levels triggers the penalties in Schedule [B]. 10. HANDBACK / END OF CONCESSION On expiry, the Concessionaire will hand back the asset to the Authority in the condition set in Schedule [F], free of encumbrances, at [no cost / stated terms]. 11. TERMINATION AND COMPENSATION Either party may terminate for the events in clause [X]; termination payments follow Schedule [G] and differ for authority default, concessionaire default and force majeure. 12. DISPUTE RESOLUTION AND GOVERNING LAW Disputes follow [escalation then arbitration at [seat] under [rules]]. This Agreement is governed by the laws of [jurisdiction]. Signed for the Authority: __________ Signed for the Concessionaire: _____ Name / title / date Name / title / date

- **Concession fee and revenue (clause 4).** This is the money engine. Choose the model: the concessionaire pays the authority (common for revenue-generating assets like airports), or the concessionaire collects tolls or user charges, or receives an annuity, or a mix with a grant or revenue share. Vague revenue terms are the commonest source of dispute.
- **Risk allocation (clause 7).** The guiding principle is to put each risk on the party best able to manage it: construction risk on the builder, demand or traffic risk where it is best borne, change-in-law risk often on the authority. A one-sided risk schedule makes a project unbankable.
- **Change in law and force majeure (clause 8).** Over a 20 to 30 year life, law and circumstances will change. A clear adjustment mechanism, extending the period or compensating, is what keeps the deal alive when they do.
- **Handback and termination (clauses 10 and 11).** Specify the condition the asset must be in at handback and the different compensation outcomes for each type of termination. Lenders read these clauses first, because they decide what happens to their money if the project ends early. ## Common mistakes to avoid - An unclear or unrealistic concession period that leaves the concessionaire unable to recover its investment.
- Vague revenue or concession-fee terms, so the parties disagree on who gets what.
- A lopsided risk schedule that scares off lenders and makes the project unbankable.
- No proper change-in-law or force majeure adjustment over a multi-decade term.
- Weak handback conditions, so the authority receives a worn-out asset at the end. ## A note on jurisdiction Concession frameworks vary by jurisdiction. In India, there is no single PPP or concession statute; concession agreements rest on general contract law, sector-specific laws (for highways, ports, airports and power), and standardised Model Concession Agreements that were originally formulated by the Planning Commission and are now maintained by NITI Aayog and line ministries, with central projects appraised through Ministry of Finance bodies. In the EU, concessions are governed by the Concessions Directive and national procurement law; the UK, Singapore and Australia have their own procurement and PPP frameworks; and in the US, concessions are largely handled at state and local level. Because the rules and model documents differ so much, the safe approach is to start from the applicable Model Concession Agreement or procurement regime for your sector and jurisdiction and say "varies by jurisdiction" rather than assume one template fits all. (Last verified October 2026.) ## Where a contract workspace helps A concession agreement runs for twenty or thirty years across a main document and many schedules, so scope, revenue and risk terms have to stay aligned, a weak or missing clause has to be caught before signing, and milestone dates, change-in-law triggers and handback obligations have to be tracked throughout. Drafting, reviewing, tracking and governing a concession agreement can live in one AI workspace tuned to your sector, with the clauses and schedule dependencies linked so per-clause risk shows and the key dates stay in view. [Adira](https://adiralaw.com) is one tool built around that single-workspace idea for long-life infrastructure deals like a concession agreement. This template alone is enough to frame a concession agreement.