Concession (contract)

Under a management contract the operator will collect the revenue only on behalf of the government and will in turn be paid an agreed fee.

A grant of land or a property by the government may be in return for services or for a particular use, a right to undertake and profit by a specified activity, a lease for a particular purpose.

A concession may include the right to use some existing infrastructure required to carry out a business (such as a water supply system in a city); in some cases, such as mining, it may involve merely the transfer of exclusive or non-exclusive easements.

Muhammad Ali of Egypt used contracts called concessions to build cheap infrastructure - dams and railroads - whereby foreign European companies would raise capital, build projects, and collect most of the operating revenue but would provide Ali's government with a portion of that revenue.

The award of services concessions with a cross-border interest has been subject to the principles of the Treaty on the Functioning of the European Union.