Framework for the Government Step-in Decision in BOT Projects
Date Issued
2005
Date
2005
Author(s)
DOI
932211E002058
Abstract
As economy slows down, the BOT/PFI projects become popular in many
countries. BOT procurement is undertaken on a service-based output basis
rather than an asset delivery basis. Major studies and efforts focused on
financial arrangements or project construction management. No serious
research on the public sector’s step-in rights related issues nor were
relevant significant cases been analyzed. To address the uncertainty nature
of BOT projects within operation period, the public sector’s action should
follow Pareto rule, namely to develop a decision–making process which (1)
maximize the efficiency of resource allocation and income distribution as
well as (2) minimize the transaction cost. Satisfying these objectives is a
challenging task that requires identifying tradeoffs among themselves. This
paper presents a case study for examining one of the very first PFI
agreements in 1993 and the renegotiation of the deal in 1999.The analysis
provides some valuable lessons which could be learned from this particular
deal for future BOT/PFI contracts design. Furthermore, the outcome of the
study will be interdisciplinary works which provide a new approach to
BOT/PFI regulators and contracting parties without discrimination.
Subjects
BOT
decision-making
benchmark approach
contract-designing
option theory
Publisher
臺北市：國立臺灣大學土木工程學系暨研究所
Type
report
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