43.103
Types of contract modifications
FAR 43.103 distinguishes between bilateral and unilateral contract modifications, outlining when each type is appropriate and who must sign them.
Overview
FAR 43.103 defines the two primary types of contract modifications: bilateral and unilateral. Bilateral modifications, also known as supplemental agreements, require signatures from both the contractor and the contracting officer and are used for negotiated changes, definitizing letter contracts, and other mutually agreed adjustments. Unilateral modifications, signed only by the contracting officer, are used for administrative changes, issuing change orders, exercising contract options, and issuing termination notices. Understanding the distinction between these modification types is essential for ensuring proper contract administration and compliance with federal procurement regulations.
Key Rules
- Bilateral Modifications
- Require signatures from both the contractor and contracting officer; used for negotiated changes, definitizing letter contracts, and other mutual agreements.
- Unilateral Modifications
- Signed only by the contracting officer; used for administrative changes, issuing change orders, exercising options, and issuing termination notices.
Responsibilities
- Contracting Officers: Must determine the appropriate type of modification and obtain necessary signatures; ensure modifications are properly documented and justified.
- Contractors: Must review and sign bilateral modifications; comply with terms of unilateral modifications as issued.
- Agencies: Oversee contract modification processes to ensure compliance with FAR requirements.
Practical Implications
- This section clarifies when each type of modification is appropriate, helping prevent unauthorized changes and disputes.
- Proper classification and execution of modifications are critical for maintaining contract integrity and avoiding compliance issues.
- Common pitfalls include failing to obtain required signatures or misclassifying the type of modification, which can lead to contractual disputes or audit findings.