Concession contract for construction of bus/tram shelters in Warsaw signed – success for DZP as the City's legal adviser

On 18 December 2013 the Public Transport Authority of the Capital City of Warsaw and a consortium of AMS and Stroer Polska concluded a contract for the construction and operation of 1,580 bus/tram shelters for Warsaw in the form of a concession for construction works. The contract was entered into for 8 years and 10 months and the shelters will start to appear on Warsaw's streets within the next 3 years.

The concession model is extremely useful from the perspective of the City's budget – Warsaw will not have to pay the contractor any funds as the consortium's only remuneration will be the right to operate the shelters. The consortium will invest approx. PLN 80 million in the design and assembly of the shelters and in exchange will have the right to earn income from selling advertising space in cases assembled on the shelters. AMS and Stroer Polska as contractor will maintain the shelters throughout the term of the concession contract and will pay the City an additional PLN 1.5 million per year in order to cover the costs of cleaning the shelter platforms.

The contract between Warsaw and the AMS/Stroer Polska consortium is the first of its kind in Warsaw for a project of such high value. The procedure that culminated in the concession contract being signed took over 3 years and during this time DZP successfully represented the City before the Voivodship Administrative Court in cases initiated due to appeals filed by procedure participants.

The project was difficult and required co-operation and arrangements between numerous city units and … the belief that PPP in Warsaw would be successful. We hope that the joint success of the City and the AMS/Stroer Polska consortium will pave the way for new ventures to be carried out by PPPs. Municipal waste incinerators, city lighting, and maybe even the modernisation of schools – there is enormous potential in Warsaw for the development of PPP, said Magdalena Zabłocka, who handled the project at the law firm Domański Zakrzewski Palinka.

Magdalena Zabłocka is an attorney-at-law and a Senior Associate in DZP's Infrastructure & Energy Practice. DZP advised Warsaw throughout the project – from preparing the legal structure for the performance of this public task, through drawing up a draft contract, to representing the City in appeal proceedings before administrative courts.