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The public service contract is a written agreement for consideration that has been concluded between one or more service providers and one or more contracting authorities and which relates to the provision of other services.

If you opt for the form of a government contract, this means that the contractor is obliged to provide the agreed service. The consideration of the client consists of a payment of an amount of money or a consideration that can be valued in money. With a government contract you therefore have enforceable performance.

Government contracts for services and supplies with a value above € 215.000 must be put out to European tender on the basis of the Public Procurement Act, so that the contract is accessible to parties in Europe. Below that threshold from a value of € 50,000 or more, you must also grant the assignment to multiple parties to access the assignment (i.e. 3 to 5 parties) or national public (open to the market) procedure must hold a procedure. Thus, above the threshold of €50.000 a direct assignment will not be possible.

The concession for services is a kind of partnership between the public sector and a (usually) private company. Concessions are used in sectors that affect EU citizens’ quality of life. Examples: road and rail transport, port and airport services, motorway maintenance and management, waste management, energy and heating services, leisure facilities and car parks. Concessions permit private capital and know-how to complement public resources and enable new investment in public infrastructure and services without increasing public debt. 

The difference with a public contract is that: in a public contract, a company is paid a fixed amount for completing the required work or providing a service. Example: a private company builds and manages a motorway for a fixed price. In a concession, a company is remunerated mostly through being permitted to run and exploit the work or service and is exposed to a potential loss on its investment. Example: a private company builds and manages a motorway and is remunerated through tolls, running the risk that the revenue generated will not cover its investment and other costs incurred.

With such a concession there is an obligation for the contractor (concessionaire) to operate an obligation, so the service must be performed. The operating risk lies with the concessionaire. The concessionaire acquires an exclusive right to offer its services within a defined area. If the exploitation risk does not lie with the contractor, it is an ordinary public contract.

A permit is the order decree on an application that allows intended activities to be carried out that are normally prohibited by law or regulations. With a permit (exemption), permission is granted to offer the relevant services that are prohibited in a city’s local regulation rules byelaw).

Permits are not subject to procurement. However, if there are scarce permits, for example due to a permit ceiling (limited number to be issued), then you are obliged to observe the principle of equality and transparency when distributing these permits. This means that you do the distribution via a selection procedure in which you allocate the permits on the basis of objective criteria that you announce in advance (i.e. in the same way as with a tender).

The entitlement to financial resources provided by an administrative body for the purpose of certain activities other than as payment for goods or services provided to the administrative body. Often used for activities related to the public interest, where the subsidy provider (often) has an interest in (maintaining) activities of the individual applications for the benefit of third parties. This often happens when competition in a market is not really possible.

In the case of a subsidy, the performance that exists against the subsidy is not or hardly enforceable. If the subsidy conditions are not (fully) met, the subsidy must be repaid in whole or in part.

In the case of scarce subsidies, as with scarce permits, there may also be an obligation to apply an objective selection method in order to distribute the subsidy.