44.201-2 Advance notification requirements
Source: FAR 44.201-2 on acquisition.gov
Contractors must notify the contracting officer in advance before awarding certain high-value or cost-plus-fixed-fee subcontracts under cost-reimbursement contracts, with specific rules depending on the agency and purchasing system status.
Overview
FAR 44.201-2 outlines the statutory requirements for contractors to provide advance notification to the contracting officer before awarding certain subcontracts under cost-reimbursement contracts. The requirements differ based on the agency involved and whether the contractor has an approved purchasing system. For the Department of Defense (DoD), Coast Guard, and NASA, contractors without an approved purchasing system must notify the contracting officer before awarding any cost-plus-fixed-fee subcontract or any fixed-price subcontract exceeding the greater of the simplified acquisition threshold or 5% of the contract's total estimated cost. For all other civilian agencies, notification is required for these subcontracts regardless of the purchasing system's approval status. This ensures government oversight of significant subcontracting actions that may impact contract performance or cost.
Under cost-reimbursement contracts, the contractor is required by statute to notify the contracting officer as follows:
(a) For the Department of Defense, the Coast Guard, and the National Aeronautics and Space Administration, unless the contractor maintains an approved purchasing system, https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title10-section3322&num=0&edition=prelim" target="_blank">10 U.S.C. 3322(c) requires notification before the award of any cost-plus-fixed-fee subcontract, or any fixed-price subcontract that exceeds the greater of the simplified acquisition threshold or 5 percent of the total estimated cost of the contract.
(b) For civilian agencies other than the Coast Guard and the National Aeronautics and Space Administration, even if the contractor has an approved purchasing system, http://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title41-section3905&num=0&edition=prelim" target="_blank">41 U.S.C. 3905 requires notification before the award of any cost-plus-fixed-fee subcontract, or any fixed-price subcontract that exceeds either the simplified acquisition threshold or 5 percent of the total estimated cost of the contract.