One of the significant novelties introduced by the new Serbian Administrative Procedure Act (hereinafter: the “Act”), which will commence with application as of 1 June 2017, is the possibility to enter into administrative agreements, another legal institute which is meant to introduce more expedience and flexibility in the administrative procedure in Serbia.

Administrative agreement represents a written document which creates, changes or terminates a legal relationship in an administrative matter, which can be entered into between a government body and a party when its conclusion is provided for by a special act. Although the explicit mention of administrative agreements cannot be found in the existing Serbian legislation, it can be considered that they already exist in some acts – such as the Public – Private Partnership Act and the Public Services Act. The Public – Private Partnership Act is applied to all investments into publicly owned assets and the contractual relationship between the public and private partner has all the markings of an administrative agreement. In the same way, the Public Services Act regulates the conditions and means of proposing and approving of public – private partnership projects. When public bodies entrust the provision of certain activities to private entities in line with the provisions of this act, such contractual relationships also represent an administrative agreement.

Having in mind that the purpose of entering into administrative agreements is primarily to satisfy a certain public interest, the authorizations of a public body as the contracting party are significantly increased in this contractual relationship. This disparity between the prerogatives of the parties is also reflected in the provisions pertaining to the termination of the administrative agreements as this right is only given to the administrative body, under certain conditions – if the party does not agree to amend the agreement in case of changed circumstances, if the party does not fulfill its contractual obligations, if it is necessary to remove grave and immediate threat for life and wellbeing of people, to promote public security, peace and public order, or if this is necessary to prevent a disruption to the economy.

Although relieved of the right to terminate the administrative agreement, the party is entitled to submit an objection in case that the administrative body fails to fulfill its contractual obligations. This objection can be filed within six months as of the public body’s failure to fulfill its contractual obligations, to the designated official of the relevant public body.

Although the introduction of this new legal institute is certainly expected to lead to increased efficacy of administrative procedure, the exact ramifications and its full blown effect can only be assessed when this institute is made part of sector acts which will make use of it in practice.