47.303-17
Contractor-prepaid commercial bills of lading, small package shipments
Contractors may use prepaid commercial bills of lading for small package shipments if authorized, but must follow strict documentation, invoicing, and consolidation rules to ensure cost savings and compliance.
Overview
FAR 47.303-17 outlines the procedures and requirements for contractor-prepaid commercial bills of lading for small package shipments when supplies are acquired f.o.b. origin. It allows contracting officers to authorize contractors to ship supplies to domestic destinations using commercial carriers, provided certain weight and security restrictions are met. The regulation also covers consolidation of shipments, reimbursement procedures, documentation requirements, and the use of specific contract clauses.
Key Rules
- Authorization for Prepaid Shipments
- Contracting officers may authorize contractors to use commercial bills of lading for shipments not exceeding 150 pounds by air or 1,000 pounds by other carriers, with no security classification.
- Consolidation of Shipments
- Contractors may consolidate Government shipments with their own to achieve cost savings, with the Government paying its pro rata share. Agency transportation personnel must ensure overall savings before authorizing consolidation.
- Ownership and Risk
- Supplies become Government property and risk transfers when loaded on the carrier’s equipment and the carrier’s receipt is obtained. The contractor pays for transportation and is reimbursed by the Government.
- Reimbursement and Documentation
- Contractors must itemize prepaid transportation charges on invoices and support them with receipted freight bills, except for certain low-value shipments where alternative documentation or waivers may apply.
- Prohibition on Splitting Shipments
- Shipments and invoices cannot be split to avoid documentation requirements for charges of $100 or less.
- Required Clause
- The clause at 52.247-65 must be included in applicable solicitations and contracts.
Responsibilities
- Contracting Officers: Authorize shipments, ensure cost savings, insert required clauses, and oversee compliance.
- Contractors: Consolidate shipments appropriately, pay and invoice for transportation, provide required documentation, and retain records as specified.
- Agencies: Evaluate transportation costs, determine documentation waivers, and process loss or damage claims per agency regulations.
Practical Implications
- This section ensures efficient, cost-effective small package shipping while protecting the Government’s interests. Contractors must follow strict documentation and invoicing rules, and agencies must verify cost savings and compliance. Common pitfalls include improper documentation, unauthorized shipment splitting, and failure to include required contract clauses.