Beach concessions: Council of State rules on the 2027 deadline and compensation for outgoing concessionaires

The regulatory framework

The obligation to subject maritime concessions for tourist and recreational use to competitive tendering does not originate from a discretionary choice by the Italian legislature. Rather, it derives from Article 12 of Directive 2006/123/EC — the so-called Bolkestein Directive — which requires an impartial and transparent selection procedure where the number of available authorisations is limited because of the scarcity of natural resources, and prohibits any preferential treatment of the incumbent service provider. In its judgment of 20 April 2023 in AGCM v Comune di Ginosa (Case C-348/22), the Court of Justice of the European Union confirmed the provision’s direct applicability, with the resulting obligation on public authorities, including municipalities, to disapply conflicting national rules.

It is against this background that the Seventh Section of the Council of State ruled on the case at issue. Two beach operators, holding concessions in a municipality in Liguria that had been repeatedly extended by law, challenged a resolution adopted by the municipal executive at the end of 2023. The resolution acknowledged the expiry of the concessions, ordered the commencement of competitive tender procedures for the new awards and, pending their completion, provided for the issue of temporary concessions for the following season. The Regional Administrative Court of Liguria dismissed the claim. In the judgment under review, the Council of State declared the appeal partly moot — one of the companies had meanwhile been awarded the concession — and dismissed it as to the remainder.

The legal issue: is 30 September 2027 a deadline or a guarantee?

The central issue on appeal concerned the timetable introduced by Decree-Law No. 131/2024, converted into Law No. 166/2024, which extended the final effectiveness of existing concessions until 30 September 2027, with the possibility of a further extension, in any event no later than 31 March 2028, where objective circumstances prevent the completion of the competitive procedure.

According to the appellants, that date guaranteed the continuation of their activities until its expiry, making any municipal action aimed at bringing the concession to an end earlier unlawful.

The Council of State starts from the broader regulatory framework. On the basis of the principles established by the Plenary Session in judgments Nos. 17 and 18 of 11 November 2021, subsequently reflected in Article 3 of Law No. 118/2022, concessions benefiting from successive statutory extensions ceased to have effect on 31 December 2023. The subsequent extension to 31 December 2024, introduced by Article 12(6-sexies) of Decree-Law No. 198/2022, must be disapplied because it conflicts with EU law.

The subsequently introduced deadline therefore does not revive concessions that had already expired. Rather, it applies to relationships that continue by virtue of a “technical” extension, compatible with EU law — as the same Section had already clarified in judgments Nos. 4479, 4480 and 4481 of 20 May 2024 — only where such extension is necessary for the conduct of the tender procedure and lasts strictly for the time required to complete it.

The Council of State’s ruling and the principle of law

Against this background, the Council of State set out a principle that is likely to guide ongoing procedures: the 30 September 2027 deadline “is relevant solely and exclusively as the maximum limit for the extension” of existing concessions.

Where an individual public authority has completed the tender procedure before that date, the extended concessions “may expire even earlier”, pursuant to a reasoned measure bringing the relationship to an early end.

The Court emphasised that the deadline is acceleratory rather than deferral-based, serving to ensure certainty as to the timing of administrative action. Requiring the public authority to wait until the maximum deadline despite having completed the tender procedure well in advance would amount to an attempt to delay the process, contrary to the application of the competition principles deriving from EU law.

In other words, municipalities are expected to conduct the procedures without undue delay and complete them as soon as reasonably possible. Resorting to the maximum statutory deadlines — both the 30 June 2027 deadline for commencing the procedures and the 30 September 2027 deadline for the effectiveness of the concessions — is therefore the exception rather than the rule.

The section of the judgment concerning compensation is equally significant. The Council of State recalls that Article 49 of the Italian Navigation Code, under which non-removable works become the property of the State without compensation unless otherwise agreed in the concession deed, was held compatible with EU law by the Court of Justice in its judgment of 11 July 2024 in Case C-598/22.

As regards fair compensation for investments that have not yet been fully amortised, introduced by Article 4(9) of Law No. 118/2022, the Court rejects any automatic entitlement. It refers in this respect to Opinion No. 750/2025 issued by the Section for Legislative Affairs on the draft implementing ministerial decree. An automatic and general obligation on the incoming concessionaire to pay compensation would be inconsistent with the limitation set out in Article 12(2) of the Directive, which prohibits advantages being granted to the incumbent service provider.

The resulting principle is that compensation payable to outgoing concessionaires is “merely contingent and not subject to automatic, standardised or generalised mechanisms”. Its recognition is conditional upon the outgoing concessionaire proving — also pursuant to the principle of proximity of evidence — that investments were actually made and remained unamortised when the concession came to an end.

An equally important consequence is that the absence of the ministerial decree establishing the calculation criteria does not prevent competitive procedures from being launched. Nor does the absence of a compensation clause in the tender documents prevent the procedures from proceeding.

Finally, the Section clarified that the rules introduced by Decree-Law No. 131/2024 do not have retroactive effect. They apply only to procedures commenced after the decree entered into force, while selection procedures resolved at an earlier date remain unaffected, in accordance with the principles of non-retroactivity and tempus regit actum.

The costs of the proceedings at the relevant instance were set off between the parties, with the Court expressly recognising the “complexity and partial novelty of the issues” addressed.

Practical implications for beach concession operators

The judgment shifts the focus of the transition process and redefines what incumbent concessionaires can reasonably expect.

The timetable is not a guarantee

The two dates governing the transition — 30 June 2027 for the commencement of the procedures and 30 September 2027 for the effectiveness of the concessions — do not guarantee that activities may continue until those dates.

Where the public authority completes the tender procedure earlier, the incoming concessionaire may take over before the relevant maximum deadline. Business planning and seasonal investments should therefore take this possibility into account.

Compensation must be documented, not presumed

Compensation for unamortised investments is a contingent entitlement whose underlying conditions must be demonstrated by the outgoing concessionaire on an asset-by-asset basis: date of construction, planning or building authorisation, invoices, amortisation schedule, residual value, and whether the relevant structure is removable or non-removable.

The necessary documentary record cannot be assembled only once the tender deadlines have begun to run and should therefore be prepared before the tender notice is published.

The absence of standard tender documents and the implementing decree does not suspend the process

The detailed rules — including requirements, criteria, weighting and evidentiary requirements — remain entrusted to the lex specialis governing each municipal procedure and must be reviewed on a case-by-case basis.

Operators active across several municipalities should therefore prepare separate documentation for each individual tender procedure.

Travia Legal advises beach operators, hotel groups, investors and public authorities on the award procedures for maritime concessions, combining expertise in administrative, corporate and employment law.