ANGOLA - "CONCESSION RULES" FOR NEW LUANDA INTERNATIONAL AIRPORT

Following the government’s authorization to launch an international public tender for the concession of the new Luanda International Airport (Presidential Decree 273/23, of 10 November 2023), the main rules of such concession (the “Concession Rules”) have now been published by way of Presidential Decree 222/23, of 13 November 2023. Below is a summary of the Concession Rules:

• The activities covered by the concession will be specified in the Tender Specifications and in the future Concession Contract and will include inter alia the following:

1. Operation and maintenance of the airport terminal;
2. Operation and maintenance of the runways;
3. Operation, maintenance and expansion of the passenger terminal;
4. Operation, maintenance and expansion of the airport support facilities;
5. Operation and maintenance of the internal roads of the airside, parking and other areas within the concession perimeter;
6. Operation and maintenance of firefighting equipment and services;
7. Operation of the fuel farm, transport and supply of fuel to the aircraft;
8. Assistance to stationed aircraft, including catering, ramp or other services to aircraft between flights (including facilitating such assistance to be provided by third parties);
9. Operation and maintenance of all equipment to be included within the perimeter of the concession.

• The perimeter of the concession will be defined in the Tender Specifications and future Concession Contract.

• The future airport operator (“Concessionaire”) may set up its offices within the airport premises in its discretion. The Concessionaire may use part of the ENNA, EP (Angolan air navigation company) building subject to a specific agreement.

• The “concession establishment” includes all assets and rights related to the concession, including the following:

1. Moveable assets, including equipment and machinery;
2. Real estate assets;
3. Improvements to the above;
4. Contracts related to the concession, including employment contracts.

• The Concessionaire shall make the following payments to the state:

1. Upfront bonus payment;
2. Annual rent in an amount to be set in the Tender Specifications and future Concession Contract.

• The concession term is 25 years, renewable for additional 15 years.

• The Concessionaire shall not be entitled to any compensation for handing over the assets to the state at the end of the concession, except as follows:

The Concessionaire shall be compensated for the net accounting value of
the assets acquired or built within the last 5 years of the concession term
subject to all of the following conditions being met:

1. Concessionaire has fully complied with the Minimum Technical Standards attached to the Concession Contract;
2. The asset is essential to the airport functioning;
3. The asset is allocated to the concession;
4. The state has authorized the respective cost;
5. The cost was incurred in the 5 years prior to the asset being handed over to the state;
6. Termination of the concession was not due to Concessionaire’s fault.

The state may off-set any amounts owed by the Concessionaire against
this compensation, including rentals in arrears, fines or interest penalties
imposed on the Concessionaire, or debts to suppliers, banks, employees,
etc.

• In order to participate in the public tender bidders must purchase the “tender pack” which includes the Tender Program, the Tender Specifications and ancillary documentation. This is subject to payment of a fee to be set by the Ministry of Transports.

• Disputes between the state and the Concessionaire shall be referred to arbitration in the terms of the Tender Specifications and future Concession Contract.

• Angolan law will be the governing law of the Concession Contract.

• The Concession Contract will obey the Public Contract Law and will take the form of a public deed (escritura pública).

• The concession will be subject to:

1. The Concession Rules specifically;
2. The general regime for airport concessions established in Presidential Decree 250/20, of 1 October 2020;
3. The Public Contract Law; and
4. The Concession Contract.

Has been prepared by OneLegal , to which MC&A is a member.

---