A council spokeswoman told BBC Radio Foyle that they would continue to work with TEO over the process.
Concerts and large events have been held in Ebrington Square since the former parade ground was regenerated and opened to the public in 2012.
It has hosted some of the biggest music events ever held in Derry, including BBC Radio 1’s Big Weekend in 2013.
Paul Connolly, frontman of Derry band Wood Burning Savages, said events of that scale now seem a long time ago.
Some local promoters, he added, now feel there are too many barriers to putting on a show at the site.
“Ebrington has so, so much potential. If we can crack how this tender process happens there is no reason why something as grand as Belsonic could not happen in Derry”.
He told BBC Radio Foyle’s North West Today programme that there are criteria in the current application process “that are not realistic, that cannot be done”.
The BBC has asked The Executive Office for comment.
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