Research On The Management Innovation Of BOT&EPC Project Construction Contract

With the development of China’s socialist market economy, highways and otherpublic infrastructure investment entities tend to be diversified. The introduction of BOT&EPC contract model, on the one hand, which can introduce social capital to reduce itsfinancial burden, on the other hand, can take advantage of the technology and talentadvantages. Currently,BOT&EPC mode is promoted nationwide, but governance structure design andlegal protection are still deficient. In this context, explore the Model of governance ofthe BOT&EPC contract has certain theoretical and practical significance. Transactioncost economics supposes contractor is the bounded rationality and opportunism doctrine,and thus the incompleteness of the contract will result in transaction costs, therebyreducing economic efficiency. Williamson suggests, the governance structure must bedesigned to match the attributes of the transaction costs. BOT&EPC mode has featuresof high asset specificity, uncertainty and transaction frequency gradually increased,therefore, which belongs regular and non-standardized transactions, the matchinggovernance structure should be Bilateral governance.Basing on theoretical research of BOT&EPC contract model, this paper analyzesthe contract governance problems, reasons and pros and cons of existing coping in theBOT&EPC model of the Xiantong highway project. Aiming at the drawbacks of theexisting governance structure for the Xiantong highway project,this paper argues thatwe should innovate BOT&EPC contract governance model through improvement ofthe two sides pledged model, risk-sharing and confidence-building mechanism with toreduce transaction costs, to achieve fairness and efficiency unified and operability asgeneral principles. At the same time, we should establish and improve the laws andregulations of the BOT&EPC mode, improve system security in order to reducetransaction costs and improve economic efficiency.