DBFOM (Design-Build-Finance-Operate-Maintain)

In a DBFOM contract, the contractor develops the infrastructure with its own funds, that is, it will provide all or the majority of the financing. The contractor is also responsible for managing the infrastructure life cycle (assuming the life-cycle cost risks) in addition to being responsible for current maintenance and operations (the contract is often referred to as a DBFM when operations are not included in the scope of the contract).
The contractor may be paid by users or by the government on the basis of service payments (payments linked to performance) or usage payments (linked to volume or use), but it may be also paid by fixed deferred payments (irrevocable and unconditional, as in a Design-Build-Finance [DBF] contract).
DBFOM (and DBFM) contracts are the only type of contracts (in terms of scope) that fulfill all of the conditions required to be a PPP. However, whether a DBFOM may be regarded as a true PPP depends upon the effectiveness of risk transfer and the nature of the links between the performance and revenue.


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