14.201-7 Contract clauses
Source: FAR 14.201-7 on acquisition.gov
FAR 14.201-7 mandates specific clauses for sealed bidding contracts, especially regarding audit rights and cost/pricing data, with special rules for Recovery Act funds and foreign government contracts.
Overview
FAR 14.201-7 outlines the mandatory contract clauses that must be included in solicitations and contracts awarded through sealed bidding. It specifies when to use certain clauses related to audit and records, price reduction for defective cost or pricing data, subcontractor cost or pricing data, and order of precedence. The section also addresses special requirements for contracts funded by the American Recovery and Reinvestment Act of 2009 and provides for waivers in contracts with foreign governments under certain conditions.
Key Rules
- Audit and Records Clause (52.214-26)
- Required for sealed bid contracts exceeding the certified cost or pricing data threshold, with special provisions (Alternate I) for contracts using Recovery Act funds.
- Price Reduction for Defective Cost or Pricing Data (52.214-27)
- Must be included in contracts exceeding the cost or pricing data threshold; waivers are possible for foreign government contracts.
- Subcontractor Cost or Pricing Data (52.214-28)
- Required for contracts above the threshold; contractors with pre-July 1, 2018 contracts can request an update to Alternate I without consideration.
- Order of Precedence (52.214-29)
- Inserted in contracts using the uniform contract format.
Responsibilities
- Contracting Officers: Ensure correct clauses are inserted based on contract value, funding source, and contract type; document waivers for foreign government contracts.
- Contractors: Comply with the requirements of the inserted clauses, especially regarding cost or pricing data and audit rights.
- Agencies: Approve and document waivers when applicable.
Practical Implications
- Ensures transparency, auditability, and pricing integrity in sealed bidding contracts.
- Contractors must be aware of which clauses apply, especially when Recovery Act funds are involved or when dealing with subcontractors.
- Failure to include or comply with these clauses can result in contract disputes or noncompliance findings.
(a) When contracting by sealed bidding, the contracting officer shall insert the clause at 52.214-26, Audit and Records-Sealed Bidding, in solicitations and contracts as follows:
(1) Use the basic clause if-
(i) The acquisition will not use funds appropriated or otherwise made available by the American Recovery and Reinvestment Act of 2009 (Pub. L. 111-5); and
(ii) The contract amount is expected to exceed the threshold at 15.403-4(a)(1) for submission of certified cost or pricing data.
(2)
(i) If the acquisition will use funds appropriated or otherwise made available by the American Recovery and Reinvestment Act of 2009, use the clause with its Alternate I in all solicitations and contracts.
(ii)
(A) In the case of a bilateral contract modification that will use funds appropriated or otherwise made available by the American Recovery and Reinvestment Act of 2009, the contracting officer shall specify applicability of Alternate I to that modification.
(B) In the case of a task- or delivery-order contract in which not all orders will use funds appropriated or otherwise made available by the American Recovery and Reinvestment Act of 2009, the contracting officer shall specify the task or delivery orders to which Alternate I applies.
(b)
(1) When contracting by sealed bidding, the contracting officer shall insert the clause at 52.214-27, Price Reduction for Defective Certified Cost or Pricing Data-Modifications-Sealed Bidding, in solicitations and contracts if the contract amount is expected to exceed the threshold for submission of certified cost or pricing data at 15.403-4(a)(1).
(2) In exceptional cases, the head of the contracting activity may waive the requirement for inclusion of the clause in a contract with a foreign government or agency of that government. The authorizations for the waiver and the reasons for granting it shall be in writing.
(c)
(1) When contracting by sealed bidding, the contracting officer shall—
(i) Insert the clause at 52.214-28, Subcontractor Certified Cost or Pricing Data—Modifications—Sealed Bidding, in solicitations and contracts if the contract amount is expected to exceed the threshold for submission of certified cost or pricing data at 15.403-4(a)(1); or
(ii) Upon request of a contractor in connection with a prime contract entered into before July 1, 2018, the contracting officer shall modify the contract without requiring consideration to replace clause 52.214-28, Subcontractor Certified Cost or Pricing Data—Modifications—Sealed Bidding, with its Alternate I.
(2) In exceptional cases, the head of the contracting activity may waive the requirement for inclusion of the clause in a contract with a foreign government or agency of that government. The authorizations for the waiver and the reasons for granting it shall be in writing.
(d) When contracting by sealed bidding the contracting officer shall insert the clause at 52.214-29, Order of Precedence-Sealed Bidding, in solicitations and contracts to which the uniform contract format applies.