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Code of Federal Regulations Title 48. Federal Acquisition Regulations System 48.32.1001 Policy

Current as of January 02, 2025 | Updated by Findlaw Staff

(a) Performance-based payments are the preferred Government financing method when the contracting officer finds them practical, and the contractor agrees to their use.

(b) Performance-based payments are contract financing payments that are not payment for accepted items.

(c) Performance-based payments are fully recoverable, in the same manner as progress payments, in the event of default.

(d) Performance-based payments are contract financing payments and, therefore, are not subject to the interest-penalty provisions of prompt payment (see Subpart 32.9). These payments shall be made in accordance with agency policy.

(e) Performance-based payments shall not be used for—

(1) Payments under cost-reimbursement line items;

(2) Contracts for architect-engineer services or construction, or for shipbuilding or ship conversion, alteration, or repair, when the contracts provide for progress payments based upon a percentage or stage of completion;  or

(3) Contracts awarded through sealed bid procedures.

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Cite this article: FindLaw.com - Code of Federal Regulations Title 48. Federal Acquisition Regulations System 48.32.1001 Policy - last updated January 02, 2025 | https://codes.findlaw.com/cfr/title-48-federal-acquisition-regulations-system/cfr-48-32-1001/

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