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Concession/PPP-s in Albania PART I

Concession/PPP-s in Albania PART I

Albania has a considerable history with the concession model. It starts with the first government of Albania, led by Ismail Kemal Bay who on the 4th of October 1913 signed the first concession (Acte de concession) for 60 years in cooperation with Austro-Hungarian and Italian firms for the creation of the Central Albanian Bank.[1] The Central Bank would have a capital of 10 million Austrian krone and 10.5 million Italian Lira and would retain exclusivity rights over issuing banknotes, securities, treasury bonds, and other financial instruments[2].


Acte de concession” for the creation of the Albanian Central Bank

On 29.12.1922 the Albanian Parliament ratified one of the earliest concession contracts, “Project-Contract over the use of forests for material production of timber and other forestry byproducts” in the regions of Krujë and Laç with the concessionaire S.I.S (Shoqnia Industria Shqiptare)[3]. The graph below shows a more systematic overview of the approved Concessions in Albania during the period 1922-1926:

NoPeriodField of Concessionary ActivityConcessionary Company
1March 1923Dekovil Durrës-BeratItalian Enterprise
2February 1925Kerosene ConcessionItalian Enterprise
3May 1925The exploitation of Coal MinesItalian Enterprise
4August 1925Geological Studies 
5May 1926Post-Telecommunication services 
6May 1926Production and distribution of electricitySITA & STAMLES
7May 1926Development of Tobacco in the area of Shkodër 
8December 1926Collection and Processing of HeatherAlbanian enterprise
9December 1926Brewery in ShkoderAlbanian Enterprise
10December 1926Dekovil Selenicë-VlorëItalian Enterprise

The main concessions were given in the field of oil exploration to foreign economic contractors covering 380.000 ha of land[5]. Among them, the famous oil Company “Anglo-Persian Oil”(BP today) and Azienda Italiana-Petroli Albania” (AIPA)[6]. Other companies who had concessions for oil exploration purposes were notably[7]: “Standard Oil of New Jersey” in the Karavasta region, “H.H Rustom” in the Patos region; “Syndicat Franco Albanais” in the Korça region and Shkodra, and the Italian company “Ferrovie Dello Stato del Regno d’Italia” who had a concession on the richest areas, Dumre, Mallakaster areas. In the interval 1930-1932 American, French, and British companies interrupted their search and thus leaving the concessions entirely on Italian companies. As a result, from the 30s onwards the Italian enterprises SIMSA and AIPA took over the control of oil and gas explorations[8]. In 1941, at the height of production capacities, the Kuçova Oil fields had 1.385 Albanian and 2.200 Italian workers, a clear indication of a very developing sector of the Albanian economy, made possible thanks to concessions[9].

After the end of World War II, the assets of big concession companies such as FERALBA, AGIP, AMMI were confiscated and a total state ownership control over the oil industry was established[10]. All the legal acts generated during the Axis occupation of Albania were deemed abrogated and declared non-existent.[11] The legislative corpus before the occupation was recognized as valid legal norms[12] but unenforceable[13] since it contradicted the new ideological direction of Albania. This marked the beginning of a new period in the legislative history where concessionary practice for all purposes intended, was formally abolished and prohibited. Only after the political changes of the late 20th century did this model reemerge in Albania.


[1] Berla Huta and others, ‘Efiçenca e partneritetit publik-privat: Një rishikim mbi literaturë’ [2017] Konferenca Studentore, Universiteti Bujqësor i Tiranës. – Berla Huta and others ‘Efficiency of Public Private Partnerships: A Review over Literature’ [2017] Student Conference Agricultural University of Tirana.

[2] (Bank of Albania) <https://www.bankofalbania.org/Muzeu_dhe_Edukimi/Edukimi/Paraja_jone/Nenshkrimi_i_koncesionit_te_pare_per_krijimin_e_nje_banke_kombetare_shqiptare_4_tetor_1913.html> accessed 4 August 2020.

[3] B. Berberi, ‘Partneriteti Publik- Privat: Hallke e Rendesishme e Procesit Te Integrimit te Shqiperise ne Komunitetin Evropian” (Dizertacion Doktoral. Tirane: Universiteti i Tiranes 2013). – B Berberi, ‘Public-Private Partnership: Important Link In The European Integration Of Albania’ (Doctoral Dissertation, University of Tirana 2013).

[4] ibid

[5] Stavre Bonita, “Shqipëria dhe shqiptarët gjatë viteve 1921-1939 në shkrimet e autorëve anglezë”[2013] Punim për gradën Doktor i Shkencave në gjuhësi. Universiteti i Tiranës. – Stavre Bonita, ‘Albania And The Albanians During The Years 1921-1939 In The Writings Of English Authors’ (Doctor of Science in Linguistics, University of Tirana 2013) and Reka R., Biçoku T, ‘Industria e naftës dhe e gazit’. Fjalori Enciklopedik Shqiptar,” [2008] (Akademia e Shkencave te Shqipërisë 2008) – R Reka and T Biçoku, ‘Oil And Gas Industry’, Albanian Encyclopedic Dictionary (Albanian National Academy of Science 2008).

[6]National Agency of Natural Resources, ‘History of Oil Discovery in Albania’ (2013).

[7] ibid

[8] Ministria e Infrastruktures dhe Energjisë, ‘100 Vjetori i Industrise Shqiptare te Naftes: Zhvillimi i industrise se naftes dhe gazit ne Shqiperi, nje histori suksesi ne shfrytezimin e pasurive natyrore kombetare’ (2018) – Ministry of Infrastructure and Energy, ‘100Th Anniversary Of The Albanian Oil Industry: Development Of The Oil And Gas Industry In Albania, A Success Story In The Exploitation Of National Natural Resources’ (2018).

[9] Z. Hamiti, Historiku i vajgurit në Shqipëri (Shtëpia Botuese Naim Frashëri,1966). – Z. Hamiti, History Of Kerosene In Albania (Naim Frasheri Publishing House 1966).

[10] National Agency of Natural Resources, ‘History of Oil Discovery in Albania’ (2013).

[11] Law No. 61, dated 17.5.1945 “On the abrogation of previous legislation” article 1

[12] Ibid, article 3

[13] ‘Decree No. 392, Dt. 25.01.1947’ [1947] Official Journal.

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