The concept of collective assumption of risk in alliance contracts is that all risks are borne equitably (as opposed to equally) by the alliance Participants. The aspiration behind this approach is that, unlike standard construction contracts, 'pure' alliance agreements do not assign project delivery risk to any one party. Both (or all) parties jointly assume and manage the risks within the terms of the alliance agreement. The aspiration behind this approach to risk is that it:
• allows the risks to be better managed than where they are allocated to one party; and
• is more appropriate for large, complex infrastructure projects or circumstances where there are many unknowns and the risks are ill-defined-making the cost of risk transfer uneconomic.