Today the policy-based management (PBM) approach is recognized as an efficient solution to simplify the complex task of managing and controlling networks. To this end, the Internet Engineering Task Force (IETF) has introduced a reference framework to build PBM systems. However, this framework only addresses the provisioning of relatively long validity period services based on predefined service-level agreements. Furthermore, very little work addresses the scalability properties of the instantiation of this framework in a real network. This work aims to extend the IETF PBM framework in order to support dynamic provisioning of short-term services (end-system signalling) as well as an instantiation scheme that is scalable (distributed provisioning of edge routers). This instantiation scheme is based on the distribution of the provisioning process while keeping centralized only the parts that involve critical resources, namely bandwidth brokerage. The performance properties of the proposed scheme are then demonstrated throughout both extensive experimentation and an analytical study. The extension of this performance analysis to the case where multiple bandwidth brokers are used is also discussed. The results of this work are intended to be used as a guideline to help network operators to design a scalable PBM system in order to offer to their customers services with quality of service assurance on an on-demand basis.