52.247-17
Charges
Contractors must never charge the government more than their lowest public rate or any lower rate previously offered to the government for the same transportation service.
Overview
FAR 52.247-17, "Charges," establishes a ceiling on the rates that contractors can charge the government for transportation or transportation-related services. Specifically, it prohibits contractors from billing the government more than their lowest rate available to the general public or any lower rate they have otherwise offered to the government for the same type of service. This clause is designed to ensure that the government receives the most favorable pricing available from the contractor, preventing overcharging and promoting fair competition.
Key Rules
- Maximum Charge Limitation
- Contractors cannot charge the government more than their lowest public rate or any lower rate previously offered to the government for the same service.
- Applicability
- This clause must be included in solicitations and contracts for transportation or transportation-related services as prescribed by FAR 47.207-6(a)(2).
Responsibilities
- Contracting Officers: Must ensure this clause is included in applicable solicitations and contracts and verify compliance during contract administration.
- Contractors: Must review their rate structures and ensure that charges to the government do not exceed the lowest public or previously tendered government rates for the same service.
- Agencies: Should monitor and audit contractor billing to ensure adherence to this pricing limitation.
Practical Implications
- This clause exists to protect the government from paying higher rates than commercial customers or rates previously offered to the government.
- Contractors must maintain transparency in their rate offerings and billing practices.
- Common pitfalls include failing to update government rates when public rates decrease or inadvertently charging higher rates due to administrative oversight.