Now that we`ve figured out what the build-operate transfer model is, let`s find out what its benefits are and why it`s so popular. For example, we have two small IT companies and one of these companies is developing a specific product. Say It creates an app that helps design simple and convenient landing pages to provide services or sell goods. And everything would be fine, but if there were more ready-made templates that the company`s potential customers could use, it would just be great. But the problem is that the company is small, it has the necessary number of employees and they are all tasked with specific tasks on working on the product and its development. And none of them have the time, strength, or skills to take on the creation and testing of these models. And that`s where the second IT company comes to the rescue with the construction operation Transfer IT outsourcing services. Because this company is only busy solving such problems. Under a concession, the private sector partner could also sell directly to public users without the need for a state intermediary. The BOT agreement often sets the minimum and maximum prices that a staker can pay. In our case, both sides of the agreement are companies.
And our “facility” is a fully functional and integrated team of IT professionals working on a client company`s project. The standard BOT contract can contain 12 parts: Upon completion of a project, the company establishes a joint venture agreement with the public sector for ownership of the plant. Then they will rent it for at least 10 years to work as a company. This is usually common in health facilities and health facilities. Provides operation and maintenance of the plant for the concession period (usually between 10 and 30 years) under an operation and maintenance agreement A BOOT (Build, Own, Operate, Transfer) project is considered a way to develop large public infrastructure with private financing. The public sector partner enters into a contract with private promoters, usually a consortium of companies with experience and expertise in a particular sector or a company specializing in the planning and implementation of large projects. Project Co and the government enter into a concession contract that defines the conditions under which they purchase and operate the plant and are entitled to revenue Each project will include some variation of this contractual structure depending on its particular requirements: Not all BOT projects require a guaranteed delivery of inputs, so a fuel/input supply contract may not be required. Cash flow can be realized in part or in whole by the general public`s rates and not by an accepting buyer. This section does not deal with the complex set of financial documents typically found in a BOT concession or project. However, BOT does not only exist in private and public partnerships.
It has also gained popularity in outsourcing to expand its operations to different countries. This is how the Build-Operate-Transfer agreement works both in large intergovernmental agreements and between small parties. But what makes interaction in build-to-farm transfer projects so beneficial and why is this form so convenient and easy for companies and other participants in the process? Let`s talk about it in more detail and look at this in a specific example. At least once in your life, you`ve heard the famous phrase “divide and rule.” But have you ever heard of Build-Operate-Transfer? Yes, this is not quite a principle of state administration, but this term is worth understanding to know how the financing of modern projects works and what the advantages are. .