You are here

Build-Operate-Transfer Agreement

A Build-Operate-Transfer (BOT) Agreemend is an agreement pursuant to which an investor agrees to construct, finance the construction of, and operate and maintain a particular infrastructure asset (e.g. an airport, port, power plant, water supply system etc.) for a certain period of time before transferring the infrastructure asset to the government. The term of such an agreement is usually long enough for the investor to recoup the investment costs of constructing the infrastructure, by charging a tariff or user fee during the period it is operating the infrastructure.

Source: IIED Briefing 4: Investment Contracts (2007)

In addition to BOT projects, infrastructure projects are also carried out in a number of other structures and contractual arrangements. For more information on PPP arrangements, see the World Bank, PPIAF and IFC Infrastructure Resource Center on Laws, Contracts and Regulations.

Related terms