43.205 Contract clauses
Source: FAR 43.205 on acquisition.gov
FAR 43.205 requires contracting officers to insert specific changes clauses and alternates in contracts based on contract type and work scope, ensuring clear procedures for managing contract modifications.
Overview
FAR 43.205 prescribes the mandatory and optional contract clauses that must be included in solicitations and contracts when change orders are anticipated. It specifies which FAR 52.243 clauses and their alternates are required based on contract type (fixed-price, cost-reimbursement, time-and-materials, labor-hour, construction, etc.) and the nature of the work (supplies, services, architect-engineer, transportation, research and development, etc.). The section ensures that both contracting officers and contractors understand the procedures and rights related to contract changes, which is critical for managing scope, cost, and schedule adjustments.
Key Rules
- Fixed-Price Contracts (Supplies/Services)
- Use FAR 52.243-1 and appropriate alternates based on whether the contract is for supplies, services, architect-engineer, transportation, or R&D.
- Cost-Reimbursement Contracts
- Use FAR 52.243-2 and alternates depending on whether the contract is for supplies, services, construction, or R&D.
- Time-and-Materials/Labor-Hour Contracts
- Use FAR 52.243-3, with flexibility for the 30-day notification period per agency procedures.
- Construction and Demolition Contracts
- Use FAR 52.243-4 for construction contracts over the simplified acquisition threshold and for dismantling/demolition; use FAR 52.243-5 for construction contracts at or below the threshold.
- Change Order Accounting
- FAR 52.243-6 may be used for complex supply or R&D contracts where many changes are expected, and optionally for construction contracts.
Responsibilities
- Contracting Officers: Must select and insert the correct changes clause and alternate(s) based on contract type and work scope; may adjust notification periods and include change order accounting as appropriate.
- Contractors: Must comply with the changes clause(s) included in their contract, including procedures for handling change orders and related notifications.
- Agencies: Ensure oversight of clause selection and compliance with FAR requirements for contract modifications.
Practical Implications
- This section ensures that all parties understand their rights and obligations when contract changes occur, reducing disputes and facilitating orderly contract administration. Failure to include the correct clause can lead to compliance issues, payment disputes, or contract performance problems. Contracting professionals must carefully match the clause and alternate to the contract type and work to ensure enforceability and clarity.
(a)
(1) The contracting officer shall insert the clause at 52.243-1, Changes-Fixed-Price, in solicitations and contracts when a fixed-price contract for supplies is contemplated.
(2) If the requirement is for services, other than architect-engineer or other professional services, and no supplies are to be furnished, the contracting officer shall use the clause with its AlternateI.
(3) If the requirement is for services (other than architect-engineer services, transportation, or research and development) and supplies are to be furnished, the contracting officer shall use the clause with its AlternateII.
(4) If the requirement is for architect-engineer or other professional services, the contracting officer shall use the clause with its AlternateIII.
(5) If the requirement is for transportation services, the contracting officer shall use the clause with its AlternateIV.
(6) If it is desired to include the clause in solicitations and contracts when a research and development contract is contemplated, the contracting officer shall use the clause with its Alternate V.
(b)
(1) The contracting officer shall insert the clause at 52.243-2, Changes-Cost-Reimbursement, in solicitations and contracts when a cost-reimbursement contract for supplies is contemplated.
(2) If the requirement is for services and no supplies are to be furnished, the contracting officer shall use the clause with its AlternateI.
(3) If the requirement is for services and supplies are to be furnished, the contracting officer shall use the clause with its AlternateII.
(4) If the requirement is for construction, the contracting officer shall use the clause with its AlternateIII.
(5) [Reserved]
(6) If it is desired to include the clause in solicitations and contracts when a research and development contract is contemplated, the contracting officer shall use the clause with its Alternate V.
(c) Insert the clause at 52.243-3, Changes-Time-and-Materials or Labor-Hours, in solicitations and contracts when a time-and-materials or labor-hour contract is contemplated. The contracting officer may vary the 30-day period in paragraph (c) of the clause according to agency procedures.
(d) The contracting officer shall insert the clause at 52.243-4, Changes, in solicitations and contracts for-
(1) Dismantling, demolition, or removal of improvements; and
(2) Construction, when a fixed-price contract is contemplated and the contract amount is expected to exceed the simplified acquisition threshold.
(e) The contracting officer shall insert the clause at 52.243-5, Changes and Changed Conditions, in solicitations and contracts for construction, when the contract amount is not expected to exceed the simplified acquisition threshold.
(f) The contracting officer may insert a clause, substantially the same as the clause at 52.243-6, Change Order Accounting, in solicitations and contracts for supply and research and development contracts of significant technical complexity, if numerous changes are anticipated. The clause may be included in solicitations and contracts for construction if deemed appropriate by the contracting officer.