Fast Payment Procedure
FAR 52.213-1 enables faster payments to contractors based on proof of shipment, but requires strict compliance with marking, documentation, and supply responsibility requirements.
Overview
FAR 52.213-1, Fast Payment Procedure, establishes a streamlined payment process for contractors supplying goods to the government. This clause allows contractors to receive payment based on proof of shipment or delivery to a post office, common carrier, or the first point of government receipt, rather than waiting for formal government acceptance. The procedure is designed to expedite payments for small purchases, reduce administrative burden, and encourage prompt delivery.
Key Rules
- Payment Based on Shipment or Delivery
- The government pays invoices upon evidence of delivery to a carrier or government receipt point, not upon final acceptance.
- Contractor Responsibility for Supplies
- Title passes to the government upon delivery, but the contractor remains responsible for loss, damage, or nonconformance until supplies are received and accepted at the destination.
- Invoice Preparation and Marking
- Invoices must be prepared as specified and prominently marked "FAST PAY." Additional shipping and receiving details are required depending on contract terms.
- Supporting Documentation
- Contractors must retain transportation bills for three years if shipping costs are billed separately and provide them upon request.
- Certification and Container Marking
- Submission of an invoice certifies compliance with shipping and quality requirements. Shipping containers must be marked "FAST PAY."
Responsibilities
- Contracting Officers: Ensure proper clause inclusion, verify compliance, and instruct contractors on corrective actions if needed.
- Contractors: Prepare and mark invoices and shipments correctly, retain required documentation, and promptly address any supply issues.
- Agencies: Oversee payment processing and enforce compliance with fast payment procedures.
Practical Implications
This clause accelerates contractor payments and reduces paperwork, but places risk of loss and responsibility for nonconforming goods on the contractor until final receipt. Failure to follow marking or documentation requirements can delay payment or shift the process to standard payment procedures.