We inform you that the ADP Consortium Group will not submit a bid for the concession of the Airport of Montenegro (ACG) and this decision was primarily due to the change in key provisions in the final version of the Concession Agreement, in particular regarding the one-time concession fee. The new formulation foresees the obligation to pay a significant and non-refundable amount by the future SPV within 30 days of signing the Concession Agreement even in the event that the Agreement does not enter into force.
This is stated in a letter sent by the French-Turkish consortium Aeroports de Paris - TAV to the Tender Committee for the award of the ACG concession.
The French-Turkish consortium Aeroports de Paris - TAV was one of three qualified bidders for the lease, and the government commission will continue the procedure by considering two bids received from the South Korean company "Incheon International Airport Corporation" and "Corporacion America Airports SA" from Luxembourg.
"Vijesti" has access to this letter.
"We hereby officially inform you of the decision of Groupe ADP Consortium not to participate in the concession award procedure for ACG. As a dedicated and long-standing partner in the development of Montenegrin infrastructure, we have carefully followed this project and invested significantly in the preparation of an ambitious, competitive and innovative bid. The purpose of this letter is to inform you of the reasons that, despite serious intention and effort, led us to refrain from submitting a bid within the framework of the tender in question. Groupe ADP Consortium has been closely following the ACG project for more than seven years, with a strong interest in contributing to the long-term development of aviation in the country. We approached the tender procedure with serious intention, and we invested significant time and resources in preparing a comprehensive bid. The proposal that we developed and prepared for submission envisaged a direct economic contribution to Montenegro in the amount of more than three billion euros, through a combination of concession fees, capital investments and tax revenues.
"If necessary, we are ready to make available to the competent authorities, in accordance with applicable laws and tender regulations, all documentation we have prepared, including architectural, financial, commercial and technical studies. We plan to make these materials available to the public after the tender is completed," the letter states.
The letter states that the following aspects are of particular concern: The one-time concession fee poses a disproportionate financial risk for potential outcomes that are not under the control of the concessionaire - such as obtaining construction permits or environmental impact assessment approvals - and which remain within the jurisdiction of state, municipal authorities or other third parties.
"This provision was introduced in the final phase of a multi-year process, thus denying bidders the opportunity to analyze, comment or negotiate. This fee is redundant in the context of the existing Closing Security Mechanism, which already protects the Grantor in the event of non-fulfillment of the Conditions Precedent. This exposes the investor to a double sanction, which we consider disproportionate and unjustified. Although the Concession Agreement and accompanying explanations state that an exceptionally high financial sanction would be applied exclusively in the event of fault attributable to the SPV, we note that the annexes to the Agreement - in particular Annex 1, Part 1 - Conditions Precedent Relating to the Responsibilities of the Project SPV - shift the entire burden of responsibility to the SPV. The obligation of the SPV to prove that the non-fulfillment of the conditions is a consequence of the actions of the state or third parties creates legal uncertainty, complexity and extremely high risk," the letter states.
It further states that the originally planned "second round of comments and objections to the Concession Agreement", as foreseen by the tender procedure and provided for in the tender documentation, was unilaterally and without adequate explanation omitted from the process.
"As a result, significant last-minute changes were imposed on investors without the possibility of commenting or negotiating, which is in direct contradiction to the tender documentation. This approach, unfortunately, negatively affected our view of the transparency and fairness of the entire procedure. In accordance with our legal analysis, this structure raises concerns not only from a commercial perspective, but also in the context of Montenegrin legislation, specifically: it is contrary to the legal nature of the One-Time Concession Fee as defined by the Concession Act of 2019 - which treats it exclusively as an advance payment on the account of the total concession fee, and not as compensation, the retention of this fee without the fulfillment of contractual obligations could be contrary to the principles of restitution, prohibition of unjust enrichment and lawful application of contractual penalties in accordance with the law of obligations of Montenegro. It can also be challenged on the grounds of excessiveness, violation of the principles of good faith and the obligation of mutual cooperation imposed on the contracting parties within the framework of long-term contracts," the letter states.
The Consortium regrets that their official request for a one-week extension of the deadline for submitting bids was rejected.
"Considering that this is a project that has been in development for more than seven years, we believe that the rejection of even a limited extension is difficult to justify, and that it raises serious questions regarding the transparency of the entire procedure. Throughout the entire process, we have consistently raised our concerns through formal communication, and we expressly reserve all our rights in this regard. We remain interested in contributing to the development of the aviation sector in Montenegro through future processes that are based on a balanced risk-sharing framework. Accordingly, we sincerely hope that Montenegro and its citizens will soon receive the modern, safe, comfortable and high-quality airport network that they have long been waiting for and truly deserve - in accordance with international legal standards and the principles of the European Union," the letter concludes.
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