Federal Acquisition Regulation (48 CFR Part 47)

Federal Acquisition Regulation

Pt. 47

the Government will relieve contractors of contractual liability for loss of
or damage to those items. However,
this relief shall not limit the Government’s rights arising under the contract to—
(1) Have any defective item or its
components corrected, repaired, or replaced when the defect or deficiency is
discovered before the loss of or damage
to a high-value item occurs; or
(2) Obtain equitable relief when the
defect or deficiency is discovered after
such loss or damage occurs.
(c) Exception. The Government will
not provide contractual relief under
paragraphs (a) and (b) above when contractor liability can be preserved without increasing the contract price.
(d) Limitations. Subject to the specific
terms of the limitation of liability
clause included in the contract, the relief provided under paragraphs (a) and
(b) above does not apply—
(1) To the extent that contractor liability is expressly provided under a
contract clause authorized by this regulation;
(2) When a defect or deficiency in, or
the Government’s acceptance of, the
supplies or services results from willful
misconduct or lack of good faith on the
part of the contractor’s managerial
personnel; or
(3) To the extent that any contractor
insurance, or self-insurance reserve,
covers liability for loss or damage suffered by the Government through purchase or use of the supplies delivered or
services performed under the contract.

Lhorne on DSK30JT082PROD with CFR

46.805

(2) In contracts requiring delivery of
high-value items, insert the clause at
52.246–24, Limitation of Liability—
High-Value Items.
(3) In contracts requiring delivery of
both high-value items and other end
items, insert both clauses prescribed in
(1) and (2) above, Alternate I of the
clause at 52.246–24, and identify clearly
in the contract schedule the line items
designated as high-value items.
(4) In contracts requiring the performance of services, insert the clause
at 52.246–25, Limitation of Liability—
Services.
(5) In contracts requiring both the
performance of services and the delivery of end items, insert the clause prescribed in subparagraph (4) above and
the appropriate clause or clauses prescribed in subparagraph (1), (2), or (3)
above, and identify clearly in the contract schedule any high-value line
items.
(b) Acquisitions at or below the simplified acquisition threshold. The clauses
prescribed by paragraph (a) of this section are not required for contracts at
or below the simplified acquisition
threshold. However, in response to a
contractor’s specific request, the contracting officer may insert the clauses
prescribed in paragraph (a)(1) or (a)(4)
of this section in a contract at or below
the simplified acquisition threshold
and may obtain any price reduction
that is appropriate.
[48 FR 42415, Sept. 19, 1983, as amended at 55
FR 3886, Feb. 5, 1990; 60 FR 34760, July 3, 1995;
61 FR 39190, July 26, 1996]

PART 47—TRANSPORTATION

Contract clauses.

(a) Contracts that exceed the simplified
acquisition threshold. The contracting
officer shall insert the appropriate
clause or combination of clauses specified in subparagraphs (a)(1) through
(a)(5) of this section in solicitations
and contracts when the contract
amount is expected to be in excess of
the simplified acquisition threshold
and the contract is subject to the requirements of this subpart as indicated
in 46.801:
(1) In contracts requiring delivery of
end items that are not high-value
items, insert the clause at 52.246–23,
Limitation of Liability.

Sec.
47.000
47.001
47.002

Scope of subpart.
Definitions.
Applicability.

Subpart 47.1—General
47.101 Policies.
47.102 Transportation insurance.
47.103 Transportation Payment and Audit
Regulation.
47.103–1 General.
47.103–2 Contract clause.
47.104 Government rate tenders under section 10721 of the Interstate Commerce
Act.
47.104–1 Government freight.
47.104–2 Fixed-price contracts.

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Pt. 47

48 CFR Ch. 1 (10–1–16 Edition)

47.104–3 Cost-reimbursement contracts.
47.104–4 Contract clauses.
47.104–5 Citation
of
Government
rate
tenders.
47.105 Transportation assistance.

Subpart 47.2—Contracts for Transportation
or for Transportation-Related Services
47.200 Scope of subpart.
47.201 Definitions.
47.202 Presolicitation planning.
47.203 [Reserved]
47.204 Single-movement contracts.
47.205 Availability of term contracts and
basic ordering agreements for transportation or for transportation-related services.
47.206 Preparation of solicitations and contracts.
47.207 Solicitation
provisions,
contract
clauses, and special requirements.
47.207–1 Qualifications of offerors.
47.207–2 Duration of contract and time of
performance.
47.207–3 Description of shipment, origin, and
destination.
47.207–4 Determination of weights.
47.207–5 Contractor responsibilities.
47.207–6 Rates and charges.
47.207–7 Liability and insurance.
47.207–8 Government responsibilities.
47.207–9 Annotation and distribution of
shipping and billing documents.
47.207–10 Discrepancies incident to shipments.
47.207–11 Volume movements within the
contiguous United States.
47.208 Report of shipment (REPSHIP).
47.208–1 Advance notice.
47.208–2 Contract clause.

Lhorne on DSK30JT082PROD with CFR

Subpart 47.3—Transportation in Supply
Contracts
47.300 Scope of subpart.
47.301 General.
47.301–1 Responsibilities of contracting officers.
47.301–2 Participation of transportation officers.
47.301–3 Using the Defense Transportation
System (DTS).
47.302 Place of delivery—f.o.b. point.
47.303 Standard delivery terms and contract
clauses.
47.303–1 F.o.b. origin.
47.303–2 F.o.b. origin, contractor’s facility.
47.303–3 F.o.b. origin, freight allowed.
47.303–4 F.o.b. origin, freight prepaid.
47.303–5 F.o.b. origin, with differentials.
47.303–6 F.o.b. destination.
47.303–7 F.o.b. destination, within consignee’s premises.
47.303–8 F.a.s. vessel, port of shipment.
47.303–9 F.o.b. vessel, port of shipment.

47.303–10 F.o.b. inland carrier, point of exportation.
47.303–11 F.o.b. inland point, country of importation.
47.303–12 Ex dock, pier, or warehouse, port
of importation.
47.303–13 C.& f. destination.
47.303–14 C.i.f. destination.
47.303–15 F.o.b. designated air carrier’s terminal, point of exportation.
47.303–16 F.o.b. designated air carrier’s terminal, point of importation.
47.303–17 Contractor-prepaid
commercial
bills of lading, small package shipments.
47.304 Determination of delivery terms.
47.304–1 General.
47.304–2 Shipments within CONUS.
47.304–3 Shipments from CONUS for overseas delivery.
47.304–4 Shipments
originating
outside
CONUS.
47.304–5 Exceptions.
47.305 Solicitation
provisions,
contract
clauses, and transportation factors.
47.305–1 Solicitation requirements.
47.305–2 Solicitations f.o.b. origin and f.o.b.
destination—lowest overall cost.
47.305–3 F.o.b. origin solicitations.
47.305–4 F.o.b. destination solicitations.
47.305–5 Destination unknown.
47.305–6 Shipments to ports and air terminals.
47.305–7 Quantity analysis, direct delivery,
and reduction of crosshauling and
backhauling.
47.305–8 Consolidation of small shipments
and the use of stopoff privileges.
47.305–9 Commodity description and freight
classification.
47.305–10 Packing, marking, and consignment instructions.
47.305–11 Options in shipment and delivery.
47.305–12 Delivery of Government-furnished
property.
47.305–13 Transit arrangements.
47.305–14 Mode of transportation.
47.305–15 Loading responsibilities of contractors.
47.305–16 Shipping characteristics.
47.305–17 Returnable cylinders.
47.306 Transportation factors in the evaluation of offers.
47.306–1 Transportation
cost
determinations.
47.306–2 Lowest
overall
transportation
costs.
47.306–3 Adequacy of loading and unloading
facilities.

Subpart 47.4—Air Transportation by U.S.Flag Carriers
47.401 Definitions.
47.402 Policy.
47.403 Guidelines for implementation of the
Fly America Act.

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Federal Acquisition Regulation

47.001

47.403–1 Availability and unavailability of
U.S.-flag air carrier service.
47.403–2 Air transport agreements between
the United States and foreign governments.
47.403–3 Disallowance of expenditures.
47.404 Air freight forwarders.
47.405 Contract clause.

Subpart 47.5—Ocean Transportation by
U.S.-Flag Vessels
47.500 Scope of subpart.
47.501 Definitions.
47.502 Policy.
47.503 Applicability.
47.504 Exceptions.
47.505 Construction contracts.
47.506 Procedures.
47.507 Contract clauses.
AUTHORITY: 40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 51 U.S.C. 20113.
SOURCE: 48 FR 42424, Sept. 19, 1983, unless
otherwise noted.

47.000 Scope of subpart.
(a) This part prescribes policies and
procedures for—
(1) Applying transportation and traffic management considerations in the
acquisition of supplies; and
(2) Acquiring transportation or transportation-related services by contract
methods other than bills of lading,
transportation
requests,
transportation warrants, and similar transportation forms. Transportation and
transportation services can be obtained
by acquisition subject to the FAR or
by acquisition under 49 U.S.C. 10721 or
49 U.S.C. 13712. Even though the FAR
does not regulate the acquisition of
transportation or transportation-related services when the bill of lading is
the contract, this contract method is
widely used and, therefore, relevant
guidance on the use of the bill of lading
is provided in this part (see 47.104).
(b) The definitions in this part have
been condensed from statutory definitions. In case of inconsistency between
the language of this part and the statutory requirements, the statute shall
prevail.

Lhorne on DSK30JT082PROD with CFR

[48 FR 42424, Sept. 19, 1983, as amended at 71
FR 202, Jan. 3, 2006]

47.001 Definitions.
As used in this part—
Bill of lading means a transportation
document, used as a receipt of goods,

as documentary evidence of title, for
clearing customs, and generally used as
a contract of carriage.
(1) Commercial bill of lading (CBL), unlike the Government bill of lading, is
not an accountable transportation document.
(2) Government bill of lading (GBL) is
an accountable transportation document, authorized and prepared by a
Government official.
Carrier or commercial carrier means a
common carrier or a contract carrier.
Common carrier means a person holding itself out to the general public to
provide transportation for compensation.
Contract carrier means a person providing transportation for compensation
under continuing agreements with one
person or a limited number of persons.
Government rate tender under 49 U.S.C.
10721 and 13712 means an offer by a
common carrier to the United States
at a rate below the regulated rate offered to the general public.
Household goods in accordance with 49
U.S.C. 13102 means personal effects and
property used or to be used in a dwelling, when a part of the equipment or
supply of such dwelling, and similar
property if the transportation of such
effects or property is arranged and paid
for by—
(1) The householder, except such
term does not include property moving
from a factory or store, other than
property that the householder has purchased with the intent to use in his or
her dwelling and is transported at the
request of, and the transportation
charges are paid to the carrier by, the
householder; or
(2) Another party.
Noncontiguous domestic trade means
transportation (except with regard to
bulk cargo, forest products, recycled
metal scrap, waste paper, and paper
waste) subject to regulation by the
Surface Transportation Board involving traffic originating in or destined to
Alaska, Hawaii, or a territory or possession of the United States (see 49
U.S.C. 13102(15) and 13702).
Released or declared value means the
assigned value of the cargo for reimbursement purposes, not necessarily
the actual value of the cargo. Released

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47.002

48 CFR Ch. 1 (10–1–16 Edition)

value may be more or less than the actual value of the cargo. The released
value is the maximum amount that
could be recovered by the agency in the
event of loss or damage for the shipments of freight and household goods.
[48 FR 42424, Sept. 19, 1983, as amended at 66
FR 2133, Jan. 10, 2001; 68 FR 28084, May 22,
2003; 71 FR 203, Jan. 3, 2006]

47.002 Applicability.
All Government personnel concerned
with the following activities shall follow the regulations in Part 47 as applicable:
(a) Acquisition of supplies.
(b) Acquisition of transportation and
transportation-related services.
(c) Transportation assistance and
traffic management.
(d) Administration of transportation
contracts, transportation-related services, and other contracts that involve
transportation.
(e) The making and administration of
contracts under which payments are
made from Government funds for—
(1) The transportation of supplies;
(2) Transportation-related services;
or
(3) Transportation of contractor personnel and their personal belongings.
[71 FR 203, Jan. 3, 2006]

Lhorne on DSK30JT082PROD with CFR

Subpart 47.1—General
47.101 Policies.
(a) For domestic shipments, the contracting officer shall authorize shipments on commercial bills of lading
(CBL’s). Government bills of lading
(GBL’s) may be used for international
or noncontiguous domestic trade shipments or when otherwise authorized.
(b) The contract administration office (CAO) shall ensure that instructions to contractors result in the most
efficient and economical use of transportation services and equipment.
Transportation personnel will assist
and provide transportation management expertise to the CAO. Specific responsibilities and details on transportation management are located in the
Federal Management Regulation at 41
CFR parts 102–117 and 102–118. (For the
Department of Defense, DoD 4500.9–R,
Defense Transportation Regulation.)

(c) The contracting officer shall obtain traffic management advice and assistance (see 47.105) in the consideration of transportation factors required for—
(1) Solicitations and awards;
(2) Contract administration, modification, and termination; and
(3) Transportation of property by the
Government to and from contractors’
plants.
(d)(1) The preferred method of transporting supplies for the Government is
by commercial carriers. However, Government-owned, leased, or chartered
vehicles, aircraft, and vessels may be
used if (i) they are available and not
fully utilized, (ii) their use will result
in substantial economies, and (iii)
their use is in accordance with all applicable statutes, agency policies and
regulations.
(2) If the three circumstances listed
in paragraph (d)(1) of this section
apply, Government vehicles may be
used for purposes such as—
(i) Local transportation of supplies
between Government installations;
(ii) Pickup and delivery services that
commercial carriers do not perform in
connection with line-haul transportation;
(iii) Transportation of supplies to
meet emergencies; and
(iv) Accomplishment of program objectives that cannot be attained by
using commercial carriers.
(e) Agencies shall not accord preferential treatment to any mode of
transportation or to any particular
carrier either in awarding or administering contracts for the acquisition of
supplies or in awarding contracts for
the acquisition of transportation. (See
subparts 47.2 and 47.3 for situations in
which the contracting officer is permitted to use specific modes of transportation.)
(f) Agencies shall place with small
business concerns purchases and contracts for transportation and transportation-related services as prescribed in
part 19.
(g) Agencies shall comply with the
Fly America Act, the Cargo Preference
Act, and related statutes as prescribed
in subparts 47.4, Air Transportation by
U.S.-Flag Carriers, and 47.5, Ocean
Transportation by U.S.-Flag Vessels.

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Federal Acquisition Regulation

47.103–1

(h) When a contract specifies delivery
of supplies f.o.b. origin with transportation costs to be paid by the Government, the contractor shall make shipments on bills of lading, or on other
shipping documents prescribed by Military Surface Deployment and Distribution Command (SDDC) in the case of
seavan containers, either at the direction of or furnished by the CAO or the
appropriate agency transportation office.
[48 FR 42424, Sept. 19, 1983, as amended at 71
FR 203, Jan. 3, 2006]

47.102 Transportation insurance.
(a) The Government generally (1) retains the risk of loss of and/or damage
to its property that is not the legal liability of commercial carriers and (2)
does not buy insurance coverage for its
property in the possession of commercial carriers (40 U.S.C. 17307). (See part
28, Bonds and Insurance.)
(b) Under special circumstances the
Government may, if such action is considered necessary and in the Government’s interest, (1) buy insurance coverage for Government property or (2)
require the carrier to (i) assume full responsibility for loss of or damage to
the Government property in its possession and (ii) buy insurance to cover the
carrier’s assumed responsibility. The
cost of this insurance to the carrier
shall be part of the transportation
cost. (The Secretary of the Treasury
prescribes regulations regarding shipments of valuables in 31 CFR parts 361
and 362.)
(c)(1) If special circumstances dictate
the need for the Government to buy insurance coverage, the contracting officer shall ascertain that (i) there is no
statutory prohibition and (ii) funds for
insurance are available.
(2) The contracting officer shall document the need and authorization for
insurance coverage in the contract file.
[48 FR 42424, Sept. 19, 1983, as amended at 70
FR 57455, Sept. 30, 2005; 71 FR 203, Jan. 3,
2006]

Lhorne on DSK30JT082PROD with CFR

47.103 Transportation
Audit Regulation.

Payment

and

47.103–1 General.
(a)(1) Regulations and procedures
governing the bill of lading, docu-

mentation, payment, and audit of
transportation services acquired by the
United States Government are prescribed in 41 CFR part 102–118, Transportation Payment and Audit.
(2) For DoD shipments, corresponding
guidance is in DoD 4500.9–R, Defense
Transportation Regulation, Part II.
(b) Under 31 U.S.C. 3726, all agencies
are required to establish a prepayment
audit program. For details on the establishment of a prepayment audit, see
41 CFR part 102–118.
(c) The agency designated in paragraph (a)(3) of the clause at 52.247–67
shall forward original copies of paid
freight bills/invoices, bills of lading,
passenger coupons, and supporting documents as soon as possible following
the end of the month, in one package
for postpayment audit to the General
Services Administration, Transportation Audit Division (QMCA), Crystal
Plaza 4, Room 300, 2200 Crystal Drive,
Arlington, VA 22202.. The specified
agency shall include the paid freight
bills/invoices, bills of lading, passenger
coupons, and supporting documents for
first-tier subcontractors under a costreimbursement contract. If the inclusion of the paid freight bills/invoices,
bills of lading, passenger coupons, and
supporting documents for any subcontractor in the shipment is not practicable, the documents may be forwarded to GSA in a separate package.
(d) Any original transportation bills
or other documents requested by GSA
shall be forwarded promptly. The specified agency shall ensure that the name
of the contracting agency is stamped
or written on the face of the bill before
sending it to GSA.
(e) A statement prepared in duplicate
by the specified agency shall accompany each shipment of transportation
documents. GSA will acknowledge receipt of the shipment by signing and
returning the copy of the statement.
The statement shall show—
(1) The name and address of the specified agency;
(2) The contract number, including
any alpha-numeric prefix identifying
the contracting office;
(3) The name and address of the contracting office;
(4) The total number of bills submitted with the statement; and

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47.103–2

48 CFR Ch. 1 (10–1–16 Edition)

(5) A listing of the respective
amounts paid or, in lieu of such listing,
an adding machine tape of the amounts
paid showing the Contractor’s voucher
or check numbers.
[71 FR 203, Jan. 2, 2006, as amended at 74 FR
11832, Mar. 19, 2009]

47.103–2

Contract clause.

Complete and insert the clause at
52.247–67, Submission of Transportation
Documents for Audit, in solicitations
and contracts when a cost-reimbursement contract is contemplated and the
contract or a first-tier cost-reimbursement subcontract thereunder will authorize reimbursement of transportation as a direct charge to the contract or subcontract.
[71 FR 203, Jan. 2, 2006]

Lhorne on DSK30JT082PROD with CFR

47.104 Government rate tenders under
sections 10721 and 13712 of the
Interstate Commerce Act (49 U.S.C.
10721 and 13712).
(a) This section explains statutory
authority for common carriers subject
to the jurisdiction of the Surface
Transportation Board (motor carrier,
water carrier, freight forwarder, rail
carrier) to offer to transport persons or
property for the account of the United
States without charge or at ‘‘a rate reduced from the applicable commercial
rate.’’ Reduced rates are offered in a
Government rate tender. Additional information for civilian agencies is available in the Federal Management Regulation (41 CFR parts 102–117 and 102–118)
and for DoD in the Defense Transportation Regulation (DoD 4500.9–R).
(b) Reduced rates offered in a Government rate tender are authorized for
transportation provided by a rail carrier, for the movement of household
goods, and for movement by or with a
water carrier in noncontiguous domestic trade.
(1) For Government rate tenders submitted by a rail carrier, a rate reduced
from the applicable commercial rate is
a rate reduced from a rate regulated by
the Surface Transportation Board.
(2) For Government rate tenders submitted for the movement of household
goods, ‘‘a rate reduced from the applicable commercial rate’’ is a rate reduced from a rate contained in a pub-

lished tariff subject to regulation by
the Surface Transportation Board.
(3) For Government rate tenders submitted for movement by or with a
water carrier in noncontiguous domestic trade, ‘‘a rate reduced from the applicable commercial rate’’ is a rate reduced from a rate contained in a published tariff required to be filed with
the Surface Transportation Board.
[71 FR 204, Jan. 3, 2006]

47.104–1 Government rate tender procedures.
(a) 49 U.S.C. 10721 and 13712 rates are
published in Government rate tenders
and apply to shipments moving for the
account of the Government on—
(1) Commercial bills of lading endorsed to show that total transportation charges are assignable to, and
will be reimbursed by, the Government
(see the clause at 52.247–1, Commercial
Bill of Lading Notations); and
(2) Government bills of lading.
(b) Agencies may negotiate with carriers for additional or revised 49 U.S.C.
10721 and 13712 rates in appropriate situations. Only personnel authorized in
agency procedures may carry out these
negotiations. The following are examples of situations in which negotiations
for additional or revised 49 U.S.C. 10721
and 13712 rates may be appropriate:
(1) Volume movements are expected.
(2) Shipments will be made on a recurring
basis
between
designated
places, and substantial savings in
transportation costs appear possible
even though a volume movement is not
involved.
(3) Transit arrangements are feasible
and advantageous to the Government.
[71 FR 204, Jan. 3, 2006]

47.104–2 Fixed-price contracts.
(a) F.o.b. destination. 49 U.S.C. 10721
and 13712 rates do not apply to shipments under fixed-price f.o.b. destination contracts (delivered price).
(b) F.o.b. origin. If it is advantageous
to the Government, the contracting officer may occasionally require the contractor to prepay the freight charges to
a specific destination. In such cases,
the contractor shall use a commercial
bill of lading and be reimbursed for the
direct and actual transportation cost

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Federal Acquisition Regulation

47.105

as a separate item in the invoice. The
clause at 52.247–1, Commercial Bill of
Lading Notations, will ensure that the
Government in this type of arrangement obtains the benefit of 49 U.S.C.
10721 and 13712 rates.

bill of lading (see the clause at 52.247–
1, Commercial Bill of Lading Notations).

[71 FR 204, Jan. 3, 2006]

(a) In order to ensure the application
of 49 U.S.C. 10721 and 13712 rates, where
authorized (see 47.104(b)), insert the
clause at 52.247–1, Commercial Bill of
Lading Notations, in solicitations and
contracts when the contracts will be—
(1) Cost-reimbursement contracts, including those that may involve the
movement of household goods (see
47.104–3(b)); or
(2) Fixed-price f.o.b. origin contracts
(other than contracts at or below the
simplified acquisition threshold) (see
47.104–2(b) and 47.104–3).
(b) The contracting officer may insert the clause at 52.247–1, Commercial
Bill of Lading Notations, in solicitations and contracts made at or below
the simplified acquisition threshold
when it is contemplated that the delivery terms will be f.o.b. origin.

47.104–3 Cost-reimbursement
contracts.
(a) 49 U.S.C. 10721 and 13712 rates may
be applied to shipments other than
those made by the Government if the
total benefit accrues to the Government, i.e., the Government shall pay
the charges or directly and completely
reimburse the party that initially
bears the freight charges. Therefore, 49
U.S.C. 10721 and 13712 rates may be used
for shipments moving on commercial
bills of lading in cost reimbursement
contracts under which the transportation costs are direct and allowable
costs under the cost principles of Part
31.
(b) 49 U.S.C. 10721 and 13712 rates may
be applied to the movement of household goods and personal effects of contractor employees who are relocated
for the convenience and at the direction of the Government and whose
total transportation costs are reimbursed by the Government.
(c) The clause at 52.247–1, Commercial
Bill of Lading Notations, will ensure
that the Government receives the benefit of lower 49 U.S.C. 10721 and 13712
rates in cost-reimbursement contracts
as described in paragraphs (a) and (b) of
this section.
(d) Contracting officers shall—
(1) Include in contracts a statement
requiring the contractor to use carriers
that offer acceptable service at reduced
rates if available; and
(2) Ensure that contractors receive
the name and location of the transportation officer designated to furnish
support and guidance when using Government rate tenders.
(e) The transportation office shall—
(1) Advise and assist contracting officers and contractors; and
(2) Make available to contractors the
names of carriers that provide service
under 49 U.S.C. 10721 and 13712 rates,
cite applicable rate tenders, and advise
contractors of the statement that must
be shown on the carrier’s commercial

[71 FR 204, Jan. 3, 2006]

47.104–4

Contract clause.

[71 FR 204, Jan. 3, 2006]

47.104–5 Citation of Government rate
tenders.
When 49 U.S.C. 10721 and 13712 rates
apply, transportation offices or contractors, as appropriate, shall identify
the applicable Government rate tender
by endorsement on bills of lading.
[71 FR 204, Jan. 3, 2006]

47.105

Transportation assistance.

(a) Civilian Government activities
that do not have transportation officers, or otherwise need assistance on
transportation matters, shall obtain
assistance from (1) the GSA Regional
Federal Supply Service Bureau that
provides support to the activity or (2)
the transportation element of the contract administration office designated
in the contract.
(b) Military installations shall obtain
transportation assistance from the
transportation office of the contracting
activity, unless another military activity has been designated as responsible
for furnishing assistance, guidance, or
data. Military transportation offices
shall request needed additional aid

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47.200

48 CFR Ch. 1 (10–1–16 Edition)

from the Military Surface Deployment
and Distribution Command (SDDC).
[48 FR 42424, Sept. 19, 1983, as amended at 54
FR 29282, July 11, 1989; 71 FR 205, Jan. 3, 2006]

Subpart 47.2—Contracts for Transportation or for TransportationRelated Services

Lhorne on DSK30JT082PROD with CFR

47.200

Scope of subpart.

(a) This subpart prescribes procedures for the acquisition by sealed bid
or negotiated contracts of—
(1) Freight transportation (including
local drayage) from rail, motor (including bus), domestic water (including inland, coastwise, and intercoastal) carriers, and from freight forwarders; and
(2) Transportation-related services
including but not limited to stevedoring, storage, packing, marking, and
ocean freight forwarding.
(b) Except as provided in paragraph
(c) below, this subpart does not apply
to—
(1) The acquisition of freight transportation from (i) domestic or international air carriers and (ii) international ocean carriers (see subparts
47.4 and 47.5);
(2) Freight transportation acquired
by bills of lading;
(3) Household goods for which rates
are negotiated under 49 U.S.C. 10721 and
13712. (These statutes do not apply in
intrastate moves); or
(4) Contracts at or below the simplified acquisition threshold.
(c) With appropriate modifications,
the procedures in this subpart may be
applied to the acquisition of freight
transportation from the carriers listed
in paragraph (b)(1) above and passenger
transportation from any carrier or
mode.
(d) The procedures in this subpart are
applicable to the transportation of
household goods of persons being relocated at Government expense except
when acquired—
(1) Under the commuted rate schedules as required in the Federal Travel
Regulation (41 CFR Chapter 302);
(2) By DoD under the DoD 4500.9–R,
Defense Transportation Regulation; or
(3) Under 49 U.S.C. 10721 and 13712
rates. (These statutes do not apply in
intrastate moves.)

(e) Additional guidance for DoD acquisition of freight and passenger
transportation is in the Defense Transportation Regulation.
[48 FR 42424, Sept. 19, 1983, as amended at 50
FR 1745, Jan. 11, 1985; 50 FR 52429, Dec. 23,
1985; 59 FR 11383, Mar. 10, 1994; 60 FR 34760,
July 3, 1995; 61 FR 39190, July 26, 1996; 71 FR
205, Jan. 3, 2006]

47.201

Definitions.

As used in this subpart—
General freight means supplies, goods,
and transportable property not encompassed in the definitions of household
goods or office furniture.
Office furniture means furniture,
equipment, fixtures, records, and other
equipment and materials used in Government offices, hospitals, and similar
establishments.
[48 FR 42424, Sept. 19, 1983, as amended at 66
FR 2133, Jan. 10, 2001; 71 FR 205, Jan. 3, 2006]

47.202

Presolicitation planning.

Contracting officers shall inform activities that plan to acquire transportation or transportation-related services of the applicable lead-time requirements, that is—
(a) The Service Contract Labor
Standards statute requirement to obtain a wage determination by accessing
the Wage Determination OnLine Web
site (http://www.wdol.gov) using the
WDOL process or by submitting a request directly to the Department of
Labor on this Web site using the e98
process before the issuance of an invitation for bid, request for proposal, or
commencement of negotiations for any
contract exceeding $2,500 that may be
subject to the Service Contract Labor
Standards statute (see subpart 22.10);
(b) The possible requirement to provide, during the solicitation period,
time for prospective offerors or contractors to inspect origin and destination locations; or
(c) The possible requirement for inspection by agency personnel of prospective contractor facilities and
equipment.
[48 FR 42424, Sept. 19, 1983, as amended at 71
FR 36935, June 28, 2006; 79 FR 24214, Apr. 29,
2014]

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47.207–1

47.203

[Reserved]

47.204

Single-movement contracts.

Single-movement contracts may be
awarded for unique transportation
services that are not otherwise available under carrier tariffs or covered by
DOD or GSA contracts; e.g., special requirements at origin and/or destination.
47.205 Availability of term contracts
and basic ordering agreements for
transportation or for transportation-related services.
(a) All Government agencies may
contract for transportation or for
transportation-related services and
execute basic ordering agreements
(BOA’s) (see subpart 16.7) unless agency
regulations prescribe otherwise. However, it is generally more economical
and efficient for most agencies to make
use of term contracts and basic ordering agreements that have been executed by agencies that employ personnel experienced in contracting for
transportation or for transportationrelated services. The Department of
Defense (DOD) and the General Services Administration (GSA) contract for
transportation or for transportationrelated services on behalf of other activities and agencies. For instance,
GSA awards term contracts for services such as local drayage, office
moves, and ocean-freight forwarding
(see 47.105 for assistance).
(b) Agencies may obtain transportation or transportation-related services for which the cost does not exceed
the simplified acquisition threshold, if
term contracts or basic ordering agreements are not available.
[48 FR 42424, Sept. 19, 1983, as amended at 60
FR 34760, July 3, 1995; 61 FR 39198, July 26,
1996]

Lhorne on DSK30JT082PROD with CFR

47.206 Preparation of solicitations and
contracts.
(a) Contracting officers shall prepare
solicitations and contracts for transportation or for transportation-related
services as prescribed elsewhere in the
FAR for fixed-price service contracts
to the extent that those requirements
are applicable and not inconsistent
with the requirements in subpart 47.2.

(b) In addition, the contracting officer shall include in solicitations and
contracts for transportation or for
transportation-related services provisions, clauses, and instructions as prescribed in section 47.207.
[48 FR 42424, Sept. 19, 1983. Redesignated at
50 FR 1745, Jan. 11, 1985; 50 FR 52429, Dec. 23,
1985]

47.207 Solicitation provisions, contract
clauses, and special requirements.
The contracting officer shall include
provisions, clauses, and special requirements in solicitations and contracts
for transportation or for transportation-related services as prescribed in
47.207–1 through 47.207–9.
47.207–1 Qualifications of offerors.
(a) Operating authorities. The contracting officer shall insert the clause
at 52.247–2, Permits, Authorities, or
Franchises, when regulated transportation is involved. The clause need not
be used when a Federal office move is
intrastate and the contracting officer
determines that it is in the Government’s interest not to apply the requirement for holding or obtaining
State authority to operate within the
State.
(b) Performance capability for Federal
office moving contracts. (1) The contracting officer shall insert the clause
at 52.247–3, Capability to Perform a
Contract for the Relocation of a Federal Office, when a Federal office is relocated, to ensure that offerors are capable to perform interstate or intrastate moving contracts involving the
relocation of Federal offices.
(2) If a Federal office move is intrastate and the contracting officer determines that it is in the Government’s
interest not to apply the requirements
for holding or obtaining State authority to operate within the State, and to
maintain a facility within the State or
commercial zone, the contracting officer shall use the clause with its Alternate I.
(c) Inspection of shipping and receiving
facilities. The contracting officer shall
insert the provision at 52.247–4, Inspection of Shipping and Receiving Facilities, when it is desired for offerors to
inspect the shipping, receiving, or
other sites to ensure realistic bids.

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47.207–2

48 CFR Ch. 1 (10–1–16 Edition)

(d) Familiarization with conditions.
The contracting officer shall insert the
clause at 52.247–5, Familiarization with
Conditions, to ensure that offerors become familiar with conditions under
which and where the services will be
performed.
(e) Financial statement. The contracting officer shall insert the provision at 52.247–6, Financial Statement,
to ensure that offerors are prepared to
furnish financial statements.

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47.207–2 Duration of contract and time
of performance.
The contracting officer shall—
(a) Establish a specific expiration
date (month, day, and year) for the
contract or state the length of time
that the contract will remain in effect;
e.g., 6 months commencing from the
date of award; and
(b) Include the following items as appropriate:
(1) A statement of the time period
during which the service is required
when the service is a one-time job; e.g.,
a routine office relocation.
(2) A time schedule for the performance of segments of a major job; e.g.,
an office relocation for which the work
phases must be coordinated to meet
other needs of the agency.
(3) Statements of performance times
for particular services; e.g., pickup and
delivery services. Specify—
(i) On which days of the week and
during which hours of the day pickup
and delivery services may be required;
(ii) The maximum time allowable to
the contractor for accomplishing delivery under regular or priority service;
and
(iii) How much advance notice the
contractor will be given for regular
pickup services and, if applicable, priority pickup services.
47.207–3 Description of shipment, origin, and destination.
(a) Origin of shipments. The contracting officer shall include in solicitations full details regarding the location from which the freight is to be
shipped. For example, if a single location is shown, furnish the shipper’s
name, street address, city, State, and
ZIP code. If several or indefinite locations are involved, as in the case of

multiple shippers or drayage contracts,
describe the area of origin including
boundaries and ZIP codes.
(b) Destination of shipments. The contracting officer shall include full details regarding delivery points. For example, if a single delivery point is
shown, furnish the consignee’s name,
street address, city, State, and ZIP
code. If several or indefinite delivery
points are involved, describe the delivery area, including boundaries and ZIP
codes.
(c) Description of the freight. The contracting officer shall include in solicitations—
(1) An inventory if the freight consists of nonbulk items; and
(2) The freight classification description, which should be obtained from
the transportation office. If a freight
classification description is not available, use a clear nontechnical description. Include additional details necessary to ensure that the prospective
offerors have complete information
about the freight; e.g., size, weight,
hazardous material, whether packed
for export, or unusual value.
(d) Exclusion of freight. The contracting officer shall (1) clearly identify any freight or types of shipments
that are subject to exclusion; e.g., bulk
freight, hazardous commodities, or
shipments under or over specified
weights; and (2) insert a clause substantially the same as the clause at
52.247–7, Freight Excluded, when any
commodities or types of shipments
have been identified for exclusion.
(e) Quantity. (1) The contracting officer shall state the actual weight of the
freight or a reasonably accurate estimate. The following are examples:
(i) If the contract covers transportation services required over an extended period of time, include a schedule of actual or estimated tonnage or
number of items to be transported per
week, month, or other time period.
(ii) If the contract covers a group
movement of household goods, give an
estimate of the aggregate weights and
the basis for determining the aggregate
weight.
(2) The contracting officer shall insert the clause at 52.247–8, Estimated
Weights or Quantities Not Guaranteed,

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47.207–6

when weights or quantities are estimates.
47.207–4

Determination of weights.

The contracting officer shall specify
in the contract the method of determining the weights of shipments as appropriate for the kind of freight involved and the type of service required.
(a) Shipments of freight other than
household goods and office furniture. (1)
The contracting officer shall insert the
clause at 52.247–9, Agreed Weight—General Freight, when the shipping activity determines the weight of shipments
of freight other than household goods
or office furniture.
(2) The contracting officer shall insert the clause at 52.247–10, Net
Weight—General Freight, when the
weight of shipments of freight other
than household goods or office furniture is not known at the time of
shipment and the contractor is responsible for determining the net weight of
the shipments.
(b) Shipments of household goods or office furniture. The contracting officer
shall insert the clause at 52.247–11, Net
Weight—Household Goods or Office
Furniture, when movements of Government employees’ household goods or
relocations of Government offices are
involved.

Lhorne on DSK30JT082PROD with CFR

47.207–5

Contractor responsibilities.

Contractor responsibilities vary with
the kinds of freight to be shipped and
services required. The contracting officer shall specify clearly those service
requirements that are not considered
normal transportation or transportation-related requirements.
(a) Type of equipment. If appropriate,
the contracting officer shall specify
the type and size of equipment to be
furnished by the contractor. Otherwise,
state that the contractor shall furnish
clean and sound closed-type equipment
of sufficient size to accommodate the
shipment.
(b) Supervision, labor, or materials. The
contracting officer shall insert a clause
substantially the same as the clause at
52.247–12, Supervision, Labor, or Materials, when the contractor is required
to furnish supervision, labor, or materials.

(c) Accessorial services—moving contracts. The contracting officer shall insert a clause substantially the same as
the clause at 52.247–13, Accessorial
Services—Moving Contracts, in contracts for the transportation of household goods or office furniture.
(d) Receipt of shipment. The contracting officer shall insert the clause
at 52.247–14, Contractor Responsibility
for Receipt of Shipment.
(e) Loading and unloading. The contracting officer shall insert the clause
at 52.247–15, Contractor Responsibility
for Loading and Unloading, when the
contractor is responsible for loading
and unloading shipments.
(f) Return of undelivered freight. The
contracting officer shall insert the
clause at 52.247–16, Contractor Responsibility for Returning Undelivered
Freight, when the contractor is responsible for returning undelivered freight.
47.207–6 Rates and charges.
(a)(1) The contracting officer shall
include in the solicitation a statement
that the charges in the contract shall
not exceed the contractor’s charges for
the same service that is—
(i) Available to the general public; or
(ii) Otherwise tendered to the Government.
(2) The contracting officer shall insert the clause at 52.247–17, Charges.
(b) The contracting officer shall include in the solicitation a tabulation
listing each required service and the
basis for the rate (price); e.g., unit of
weight or per work-hour, leaving sufficient space for offerors to insert the
rates offered for each service.
(c) The following guidelines apply to
the composition of a tabulation of
transportation or of transportation-related services and their rate (price)
bases:
(1) Combination of pricing bases. If various types of services with different
bases for assessing charges are required
under the same contract, show each
service separately and the applicable
basis for that service.
(2) Hourly rate basis. If charges are
based on an hourly rate, state the
method for charging for fractions of an
hour; e.g., (i) a period of 30 minutes or
less is charged at one-half the hourly
rate and (ii) the hourly rate applies to

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48 CFR Ch. 1 (10–1–16 Edition)

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any portion of an hour that exceeds 30
minutes.
(3) Shipments of varying weights. If
charges are based on weight and shipments will vary in weight, request
rates on a graduated weight basis. Include a table of graduated weights for
offerors to insert rates.
(4) Multiple origins and/or destinations.
Specify whether rates are requested for
each origin and/or each destination or
for specific groups of origins and/or
destinations.
(5) Multiple shipments from one origin.
If multiple shipments will be tendered
at one time to the contractor for delivery to two or more consignees at the
same destination, request the rate applicable to the aggregate weight. If
such shipments are for delivery to various destinations along the route between origin and last destination, request the rate applicable to the aggregate weight and a stopoff charge for
each intermediate destination.
(i) The contracting officer shall insert the clause at 52.247–18, Multiple
Shipments, when multiple shipments
are tendered at one time to the contractor for transportation from one origin to two or more consignees at the
same destination.
(ii) The contracting officer shall insert the clause at 52.247–19, Stopping in
Transit for Partial Unloading, when
multiple shipments are tendered at one
time to the contractor for transportation from one origin to two or more
consignees along the route between origin and last destination.
(6) Estimated quantities or weights. The
contracting officer shall insert in solicitations the provision at 52.247–20,
Estimated Quantities or Weights for
Evaluation of Offers, when quantities
or weights of shipments between each
origin and destination are not known,
stating estimated quantity or weight
for each origin/destination pair.
(7) Additional services. If services in
addition to those covered in the basic
rate are anticipated; e.g., inside delivery, state the conditions under which
payment will be made for those services.
47.207–7 Liability and insurance.
(a) The contracting officer shall
specify—

(1) The contractor’s liability for injury to persons or damage to property
other than the freight being transported;
(2) The contractor’s liability for loss
of and/or damage to the freight being
transported; and
(3) The amount of insurance the contractor is required to maintain.
(b) When the contractor’s liability
for loss of and/or damage to the freight
being transported is not specified, the
usual measure of liability as prescribed
in section 11706 of the Interstate Commerce Act (49 U.S.C. 11706) applies.
(c) The contracting officer shall insert the clause at 52.247–21, Contractor
Liability for Personal Injury and/or
Property Damage.
(d) The contracting officer shall insert the clause at 52.247–22, Contractor
Liability for Loss of and/or Damage to
Freight other than Household Goods,
in solicitations and contracts for the
transportation of freight other than
household goods.
(e) The contracting officer shall insert the clause at 52.247–23, Contractor
Liability for Loss of and/or Damage to
Household Goods, in solicitations and
contracts for the transportation of
household goods, including the rate per
pound appropriate to the situation.
(f) When freight is not shipped under
rates subject to released or declared
value, see 28.313(a) and the clause at
52.228–9, Cargo Insurance.
(g) When the contracting officer determines that vehicular liability and/or
general public liability insurance required by law are not sufficient for a
contract, see 28.313(b) and the clause at
52.228–10, Vehicular and General Public
Liability Insurance.
[48 FR 42424, Sept. 19, 1983, as amended at 71
FR 205, Jan. 3, 2006]

47.207–8 Government responsibilities.
(a) The contracting officer shall state
clearly the Government’s responsibilities that have a direct bearing on the
contractor’s performance under the
contract; e.g., the Government’s responsibility to notify the contractor in
advance when hazardous materials are
included in a shipment.
(1) Advance notification. The contracting officer shall insert the clause
at 52.247–24, Advance Notification by

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47.208–1

the Government, when the Government
is responsible for notifying the contractor of specific service times or unusual shipments.
(2) Government equipment with or without operators (i) The contracting officer
shall insert the clause at 52.247–25, Government-Furnished Equipment with or
without Operators, when the Government furnishes equipment with or
without operators.
(ii) Insert the kind of equipment and
the locations where the equipment will
be furnished.
(3) Direction and marking. The contracting officer shall insert the clause
at 52.247–26, Government Direction and
Marking, when office relocations are
involved.
(b) The contracting officer shall insert the clause at 52.247–27, Contract
Not Affected by Oral Agreement.
47.207–9 Annotation and distribution
of shipping and billing documents.
(a) The contracting officer shall state
in detail the responsibilities of the contractor, the contracting agency, and, if
appropriate, the consignee for the annotation and distribution of shipping
and billing documents. See 41 CFR part
102–118, Transportation Payment and
Audit.
(b) In instances of mass movements
of freight made available to the contractor at one time, it is particularly
important that the contracting officer
specifies that bills of lading be crossreferenced so that the Government
benefits from applicable volume rates.
(c) The contracting officer shall insert the clause at 52.247–28, Contractor’s Invoices, in drayage or other term
contracts.

Lhorne on DSK30JT082PROD with CFR

[48 FR 42424, Sept. 19, 1983, as amended at 71
FR 205, Jan. 3, 2006]

47.207–10 Discrepancies incident to
shipments.
Discrepancies incident to shipment
include overage, shortage, loss, damage, and other discrepancies between
the quantity and/or condition of supplies received from commercial carrier
and the quantity and/or condition of
these supplies as shown on the covering
bill of lading or other transportation
document. Regulations and procedures
for reporting and adjusting discrep-

ancies in Government shipments are in
41 CFR parts 102–117 and 118. (For the
Department of Defense (DoD), see DoD
4500.9–R, Defense Transportation Regulation, Part II, Chapter 210).
[71 FR 205, Jan. 3, 2006]

47.207–11 Volume movements within
the contiguous United States.
(a) For purposes of contract administration, a volume movement is—
(1) In DoD, the aggregate of freight
shipments amounting to or exceeding
25 carloads, 25 truckloads, or 500,000
pounds, to move during the contract
period from one origin point for delivery to one destination point or area;
and
(2) In civilian agencies, 50 short tons
(100,000 pounds) in the aggregate to
move during the contract period from
one origin point for delivery to one destination point or area.
(b) Transportation personnel assigned to or supporting the CAO, or appropriate agency personnel, shall report planned and actual volume movements in accordance with agency regulations. DoD activities report to the
Military Surface Deployment and Distribution Command (SDDC) under DoD
4500.9–R, Defense Transportation Regulation. Civilian agencies report to the
local office of GSA’s Office of Transportation (see www.gsa.gov/transportation (click on Transportation Management Zone Offices in left-hand column, then click on Transportation
Management Zones under Contacts on
right-hand column).
[71 FR 205, Jan. 3, 2006]

47.208

Report of shipment (REPSHIP).

47.208–1

Advance notice.

Military (and as required, civilian
agency)
storage
and
distribution
points, depots, and other receiving activities require advance notice of shipments en route from contractors’
plants. Generally, this notification is
required only for classified material;
sensitive, controlled, and certain other
protected material; explosives, and
some other hazardous materials; selected shipments requiring movement

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48 CFR Ch. 1 (10–1–16 Edition)

control; or minimum carload or truckload shipments. It facilitates arrangements for transportation control,
labor, space, and use of materials handling equipment at destination. Also,
timely receipt of notices by the consignee transportation office precludes
the incurring of demurrage and vehicle
detention charges.
[71 FR 205, Jan. 3, 2006]

47.208–2

Contract clause.

The contracting officer shall insert
the clause at 52.247–68, Report of Shipment (REPSHIP), in solicitations and
contracts when advance notice of shipment is required for safety or security
reasons, or where carload or truckload
shipments will be made to DoD installations or, as required, to civilian agency facilities.
[71 FR 205, Jan. 3, 2006]

Subpart 47.3—Transportation in
Supply Contracts
47.300

Scope of subpart.

(a) This subpart prescribes policies
and procedures for the application of
transportation and traffic management
considerations in the acquisition of
supplies. The terms and conditions contained in this subpart are applicable to
fixed-price contracts.
(b) If a special requirement exists for
application of any of these terms and
conditions to other types of contracts;
e.g., cost-reimbursement contracts, for
which transportation arrangements are
normally the responsibility of the contractor and transportation costs are allowable, the contracting officer shall
use the terms and conditions prescribed in this subpart as a guide for (1)
contract coverage of transportation
and (2) instructions to the contractor
to minimize the ultimate transportation costs to the Government.

Lhorne on DSK30JT082PROD with CFR

[48 FR 42424, Sept. 19, 1983, as amended at 68
FR 28092, May 22, 2003]

47.301 General.
(a) Transportation and traffic management factors are important in
awarding and administering contracts
to ensure that (1) acquisitions are
made on the basis most advantageous

to the Government and (2) supplies arrive in good order and condition and on
time at the required place. (See 47.104
for possible reduced transportation
rates for Government shipments).
(b) The requiring activity shall—
(1) Consider all transportation factors including present and future requirements, positioning of supplies,
and subsequent distribution to the extent known or ascertainable; and
(2) Provide the contracting office
with information and instructions reflecting transportation factors applicable to the particular acquisition.
47.301–1 Responsibilities
of
contracting officers.
(a) Contracting officers shall obtain
from traffic management offices transportation factors required for (1) solicitations and awards and (2) contract administration, modification, and termination, including the movement of
property by the Government to and
from contractors’ plants.
(b) Contracting officers shall request
transportation office participation especially before making an initial acquisition of supplies that are unusually
large, heavy, high, wide, or long; have
sensitive or dangerous characteristics;
or lend themselves to containerized
movements from the source. In determining total transportation charges,
contracting officers shall also consider
additional costs arising from factors
such as the use of special equipment,
excess blocking and bracing material,
or circuitous routing.
47.301–2 Participation of transportation officers.
Agencies’
transportation
officers
shall participate in the solicitation and
evaluation of offers to ensure that all
necessary transportation factors, such
as transportation costs, transit arrangements, time in transit, and port
capabilities, are considered and result
in solicitations and contracts advantageous to the Government. Transportation officers shall provide traffic
management assistance throughout the
acquisition cycle (see 47.105 Transportation assistance).
[48 FR 42424, Sept. 19, 1983, as amended at 50
FR 1745, Jan. 11, 1985; 50 FR 52429, Dec. 23,
1985]

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47.303

47.301–3 Using the Defense Transportation System (DTS).
(a) All military and civilian agencies
shipping, or arranging for the acquisition and shipment by Government contractors, through the use of militarycontrolled transport or through military transshipment facilities shall follow Department of Defense (DoD) Regulation DoD 4500.9–R, Defense Transportation Regulation Part II. This establishes uniform procedures and documents for the generation, documentation, communication, and use of transportation information, thus providing
the capability for control of shipments
moving in the DTS. DoD 4500.9–R, Defense Transportation Regulation Part
II has been implemented on a worldwide basis.
(b) Contracting activities are responsible for (1) ensuring that the requirements of the DoD 4500.9–R, Defense
Transportation Regulation Part II regulation are included in appropriate
contracts for all applicable shipments
and (2) enforcing these requirements
with regard to shipments under their
control. This includes requirements relating to documentation, marking, advance notification of shipment dates,
and terminal clearances.
(c) Contractual documents shall designate a contract administration office
(see 42.202(a)) as the contact point to
which the contractor will provide necessary information to (1) effect DoD
4500.9–R, Defense Transportation Regulation Part II documentation and
movement control, including air or
water terminal shipment clearances;
and (2) obtain data necessary for shipment marking and freight routing.
Contractual documents shall specify
that the contractor shall not ship directly to a military air or water port
terminal without authorization from
the designated contract administration
office (see 47.305–6(f)).

Lhorne on DSK30JT082PROD with CFR

[48 FR 42424, Sept. 19, 1983, as amended at 51
FR 2666, Jan. 17, 1986; 55 FR 38517, Sept. 18,
1990; 63 FR 9065, Feb. 23, 1998; 71 FR 205, Jan.
3, 2006]

47.302 Place of delivery—f.o.b. point.
(a) The policies and procedures in
47.304–1, –2, and –3 govern the transportation of supplies from sources in the
Contiguous United States (CONUS), ex-

cept when identifiable costs, nature of
the supplies (security, safety, or value),
delivery requirements (premium modes
of transport, escorts, transit arrangements, and tentative conditions), or
other advantages, limitations, or requirements dictate otherwise. The policies and procedures in 47.304–4 govern
the transportation of supplies from
sources outside CONUS.
(b) Generally, the contracting officer
shall solicit offers, and award contracts, with delivery terms on the basis
prescribed in 47.304. The contracting officer shall document the contract file
(see 4.801) with justifications for solicitations that do not specify delivery on
the basis prescribed in 47.304.
(c)(1) The place of performance of
Government acquisition quality assurance actions and the place of acceptance shall not control the delivery
term, except that if acceptance is at
destination, transportation shall be
f.o.b. destination (see 47.304–1(f)).
(2) The fact that transportation is
f.o.b. destination does not alone necessitate changing the place of acceptance
from origin to destination; and the fact
that acceptance is at origin does not
necessitate an f.o.b. origin delivery
term. Providing for inspection and acceptance at origin (if appropriate under
46.402), in conjunction with an f.o.b.
destination term, may be advantageous
to both the Government and the contractor. Acceptance of title at origin
by the Government permits payment of
the contractor, provided the invoice is
supported either by a copy of the
signed commercial bill of lading (indicating the carrier’s receipt of the supplies covered by the invoice for transportation to the particular destination
specified in the contract) or by other
appropriate evidence of shipment to
the particular destination for the contractor’s account.
[48 FR 42424, Sept. 19, 1983, as amended at 68
FR 28084, May 22, 2003]

47.303 Standard delivery terms and
contract clauses.
Standard delivery terms are listed in
47.303–1 through 47.303–16 (but see 47.300
regarding applicability to cost reimbursement contracts).
[53 FR 34228, Sept. 2, 1988]

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47.303–1

48 CFR Ch. 1 (10–1–16 Edition)
F.o.b. origin.

(a) Explanation of delivery term. F.o.b.
origin means free of expense to the Government delivered—
(1) On board the indicated type of
conveyance of the carrier (or of the
Government, if specified) at a designated point in the city, county, and
State from which the shipment will be
made and from which line-haul transportation service (as distinguished
from switching, local drayage, or other
terminal service) will begin;
(2) To, and placed on, the carrier’s
wharf (at shipside, within reach of the
ship’s loading tackle, when the shipping point is within a port area having
water transportation service) or the
carrier’s freight station;
(3) To a U.S. Postal Service facility;
or
(4) If stated in the solicitation, to
any Government-designated point located within the same city or commercial zone as the f.o.b. origin point specified in the contract (the Federal
Motor Carrier Safety Administration
prescribes commercial zones at Subpart B of 49 CFR part 372).
(b) Contractor responsibilities. The contractor shall—
(1)(i) Pack and mark the shipment to
comply with contract specifications; or
(ii) In the absence of specifications,
prepare the shipment in conformance
with carrier requirements to protect
the goods and to ensure assessment of
the lowest applicable transportation
charge;
(2)(i) Order specified carrier equipment when requested by the Government; or
(ii) If not specified, order appropriate
carrier equipment not in excess of capacity to accommodate shipment;
(3) Deliver the shipment in good
order and condition to the carrier, and
load, stow, trim, block, and/or brace
carload or truckload shipment (when
loaded by the contractor) on or in the
carrier’s conveyance as required by
carrier rules and regulations;
(4) Be responsible for any loss of and/
or damage to the goods—
(i) Occurring before delivery to the
carrier;
(ii) Resulting from improper packing
and marking; or

(iii) Resulting from improper loading, stowing, trimming, blocking, and/
or bracing of the shipment, if loaded by
the contractor on or in the carrier’s
conveyance;
(5) Complete the Government bill of
lading supplied by the ordering agency
or, when a Government bill of lading is
not supplied, prepare a commercial bill
of lading or other transportation receipt. The bill of lading shall show—
(i) A description of the shipment in
terms of the governing freight classification or tariff (or Government rate
tender) under which lowest freight
rates are applicable;
(ii) The seals affixed to the conveyance with their serial numbers or other
identification;
(iii) Lengths and capacities of cars or
trucks ordered and furnished;
(iv) Other pertinent information required to effect prompt delivery to the
consignee, including name, delivery address, postal address and ZIP code of
consignee, routing, etc.;
(v) Special instructions or annotations requested by the ordering agency
for commercial bills of lading; e.g.,
‘‘This shipment is the property of, and
the freight charges paid to the carrier(s) will be reimbursed by, the Government’’; and
(vi) The signature of the carrier’s
agent and the date the shipment is received by the carrier; and
(6) Distribute the copies of the bill of
lading, or other transportation receipts, as directed by the ordering
agency.
(c) Contract clause. The contracting
officer shall insert in solicitations and
contracts the clause at 52.247–29, F.o.b.
Origin, when the delivery term is f.o.b.
origin.
[48 FR 42424, Sept. 19, 1983, as amended at 53
FR 17859, May 18, 1988; 71 FR 206, Jan. 3, 2006]

47.303–2 F.o.b. origin, contractor’s facility.
(a) Explanation of delivery term. F.o.b.
origin, contractor’s facility means free of
expense to the Government delivered
on board the indicated type of conveyance of the carrier (or of the Government if specified) at the designated facility, on the named street or highway,
in the city, county, and State from
which the shipment will be made.

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Federal Acquisition Regulation

47.303–5

(b) Contractor responsibilities. The contractor’s responsibilities are the same
as those listed in 47.303–1(b).
(c) Contract clause. The contracting
officer shall insert in solicitations and
contracts the clause at 52.247–30, F.o.b.
Origin, Contractor’s Facility, when the
delivery term is f.o.b. origin, contractor’s facility.

Lhorne on DSK30JT082PROD with CFR

47.303–3

F.o.b. origin, freight allowed.

(a) Explanation of delivery term. F.o.b.
origin, freight allowed means—
(1) Free of expense to the Government delivered—
(i) On board the indicated type or
conveyance of the carrier (or of the
Government, if specified) at a designated point in the city, county, and
State from which the shipments will be
made and from which line-haul transportation service (as distinguished
from switching, local drayage, or other
terminal service) will begin;
(ii) To, and placed on, the carrier’s
wharf (at shipside, within reach of the
ship’s loading tackle, when the shipping point is within a port area having
water transportation service) or the
carrier’s freight station;
(iii) To a U.S. Postal Service facility;
or
(iv) If stated in the solicitation, to
any Government-designated point located within the same city or commercial zone as the f.o.b. origin point specified in the contract (the Federal
Motor Carrier Safety Administration
prescribes commercial zones at Subpart B of 49 CFR part 372); and
(2) An allowance for freight, based on
applicable published tariff rates (or
Government rate tenders) between the
points specified in the contract, is deducted from the contract price.
(b) Contractor responsibilities. The contractor’s responsibilities are the same
as those listed in 47.303–1(b).
(c) Contract clause. The contracting
officer shall insert in solicitations and
contracts the clause at 52.247–31, F.o.b.
Origin, Freight Allowed, when the delivery term is f.o.b. origin, freight allowed.
[48 FR 42424, Sept. 19, 1983, as amended at 53
FR 17859, May 18, 1988; 71 FR 206, Jan. 3, 2006]

47.303–4 F.o.b. origin, freight prepaid.
(a) Explanation of delivery term. F.o.b.
origin, freight prepaid means—
(1) Free of expense to the Government delivered—
(i) On board the indicated type of
conveyance of the carrier (or of the
Government, if specified) at a designated point in the city, county, and
State from which the shipments will be
made and from which line-haul transportation service (as distinguished
from switching, local drayage, or other
terminal service) will begin;
(ii) To, and placed on, the carrier’s
wharf (at shipside, within reach of the
ship’s loading tackle, when the shipping point is within a port area having
water transportation service) or the
carrier’s freight station;
(iii) To a U.S. Postal Service facility;
or
(iv) If stated in the solicitation, to
any Government-designated point located within the same city or commercial zone as the f.o.b. origin point specified in the contract (the Federal
Motor Carrier Safety Administration
prescribes commercial zones at Subpart B of 49 CFR part 372); and
(2) The cost of transportation, ultimately the Government’s obligation, is
prepaid by the contractor to the point
specified in the contract.
(b) Contractor responsibilities. The contractor’s responsibilities are the same
as those listed in 47.303–1(b), except
that the contractor shall prepare commercial bills of lading or other transportation receipts and shall prepay all
freight charges to the extent specified
in the contract.
(c) Contract clause. The contracting
officer shall insert in solicitations and
contracts the clause at 52.247–32, F.o.b.
Origin, Freight Prepaid, when the delivery term is f.o.b. origin, freight prepaid.
[48 FR 42424, Sept. 19, 1983, as amended at 53
FR 17859, May 18, 1988; 71 FR 206, Jan. 3, 2006]

47.303–5 F.o.b. origin, with differentials.
(a) Explanation of delivery term. F.o.b.
origin, with differentials means—
(1) Free of expense to the Government delivered—
(i) On board the indicated type of
conveyance of the carrier (or of the

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47.303–6

48 CFR Ch. 1 (10–1–16 Edition)

Government, if specified) at a designated point in the city, county, and
State from which the shipments will be
made and from which line-haul transportation service (as distinguished
from switching, local drayage, or other
terminal service) will begin;
(ii) To, and placed on, the carrier’s
wharf (at shipside, within reach of the
ship’s loading tackle, when the shipping point is within a port area having
water transportation service) or the
carrier’s freight station;
(iii) To a U.S. Postal Service facility;
or
(iv) If stated in the solicitation, to
any Government-designated point located within the same city or commercial zone as the f.o.b. origin point specified in the contract (the Federal
Motor Carrier Safety Administration
prescribes commercial zones at Subpart B of 49 CFR part 372); and
(2) Differentials for mode of transportation, type of vehicle, or place of delivery as indicated in contractor’s offer
may be added to the contract price.
(b) Contractor responsibilities. The contractor’s responsibilities are the same
as those listed in 47.303–1(b).
(c) Contract clause. Insert in solicitations and contracts the clause at
52.247–33, F.o.b. Origin, with Differentials, when it is likely that offerors
may include in f.o.b. origin offers a
contingency to compensate for unfavorable routing conditions by the Government at the time of shipment.

Lhorne on DSK30JT082PROD with CFR

[48 FR 42424, Sept. 19, 1983, as amended at 53
FR 17859, May 18, 1988; 71 FR 206, Jan. 3, 2006]

47.303–6 F.o.b. destination.
(a) Explanation of delivery term. F.o.b.
destination means—
(1) Free of expense to the Government delivered, on board the carrier’s
conveyance, at a specified delivery
point where the consignee’s facility
(plant, warehouse, store, lot, or other
location to which shipment can be
made) is located; and
(2) Supplies shall be delivered to the
destination consignee’s wharf (if destination is a port city and supplies are
for export), warehouse unloading platform, or receiving dock, at the expense
of the contractor. The Government
shall not be liable for any delivery,
storage, demurrage, accessorial, or

other charges involved before the actual delivery (or constructive placement
as defined in carrier tariffs) of the supplies to the destination, unless such
charges are caused by an act or order
of the Government acting in its contractual capacity. If rail carrier is
used, supplies shall be delivered to the
specified unloading platform of the
consignee. If motor carrier (including
‘‘piggyback’’) is used, supplies shall be
delivered to truck tailgate at the unloading platform of the consignee, except when the supplies delivered meet
the requirements of Item 568 of the National Motor Freight Classification for
‘‘heavy or bulky freight.’’ When supplies meeting the requirements of the
referenced Item 568 are delivered, unloading (including movement to the
tailgate) shall be performed by the consignee, with assistance from the truck
driver, if requested. If the contractor
uses rail carrier or freight forwarder
for less than carload shipments, the
contractor shall ensure that the carrier
will furnish tailgate delivery when required, if transfer to truck is required
to complete delivery to consignee.
(b) Contractor responsibilities. The contractor shall—
(1)(i) Pack and mark the shipment to
comply with contract specifications; or
(ii) In the absence of specifications,
prepare the shipment in conformance
with carrier requirements;
(2) Prepare and distribute commercial bills of lading;
(3) Deliver the shipment in good
order and condition to the point of delivery specified in the contract;
(4) Be responsible for any loss of and/
or damage to the goods occurring before receipt of the shipment by the consignee at the delivery point specified in
the contract;
(5) Furnish a delivery schedule and
designate the mode of delivering carrier; and
(6) Pay and bear all charges to the
specified point of delivery.
(c) Contract clause. The contracting
officer shall insert in solicitations and
contracts the clause at 52.247–34, F.o.b.
Destination, when the delivery term is
f.o.b. destination.
[48 FR 42424 Sept. 19, 1983, as amended at 55
FR 52796, Dec. 21, 1990]

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Federal Acquisition Regulation

47.303–10

47.303–7 F.o.b. destination, within consignee’s premises.
(a) Explanation of delivery term. F.o.b.
destination, within consignee’s premises
means free of expense to the Government delivered and laid down within
the doors of the consignee’s premises,
including delivery to specific rooms
within a building if so specified.
(b) Contractor responsibilities. The contractor’s responsibilities are the same
as those listed in 47.303–6(b).
(c) Contract clause. The contracting
officer shall insert in solicitations and
contracts the clause at 52.247–35, F.o.b.
Destination, within Consignee’s Premises, when the delivery term is f.o.b.
destination, within consignee’s premises.

Lhorne on DSK30JT082PROD with CFR

47.303–8

F.a.s. vessel, port of shipment.

(a) Explanation of delivery term. F.a.s.
vessel, port of shipment means free of expense to the Government delivered
alongside the ocean vessel and within
reach of its loading tackle at the specified port of shipment.
(b) Contractor responsibilities. The contractor shall—
(1)(i) Pack and mark the shipment to
comply with contract specifications; or
(ii) In the absence of specifications,
prepare the shipment for ocean transportation in conformance with carrier
requirements to protect the goods and
to ensure assessment of the lowest applicable transportation charge;
(2)(i) Deliver the shipment in good
order and condition alongside the
ocean vessel and within reach of its
loading tackle, at the point of delivery
and on the date or within the period
specified in the contract; and
(ii) Pay and bear all applicable
charges,
including
transportation
costs, wharfage, handling, and heavy
lift charges, if necessary, up to this
point;
(3) Provide a clean dock or ship’s receipt;
(4) Be responsible for any loss of and/
or damage to the goods occurring before delivery of the shipment to the
point specified in the contract; and
(5) At the Government’s request and
expense, assist in obtaining the documents required for (i) exportation or
(ii) importation at destination.

(c) Contract clause. The contracting
officer shall insert in solicitations and
contracts the clause at 52.247–36, F.a.s.
Vessel, Port of Shipment, when the delivery term is f.a.s. vessel, port of shipment.
47.303–9 F.o.b. vessel, port of shipment.
(a) Explanation of delivery term. F.o.b.
vessel, port shipment means free of expense to the Government loaded,
stowed, and trimmed on board the
ocean vessel at the specified port of
shipment.
(b) Contractor responsibilities. The contractor shall—
(1)(i) Pack and mark the shipment to
comply with contract specifications; or
(ii) In the absence of specifications,
prepare the shipment for ocean transportation in conformance with carrier
requirements to protect the goods and
to ensure assessment of the lowest applicable transportation charge;
(2)(i) Deliver the shipment on board
the ocean vessel in good order and condition on the date or within the period
fixed; and
(ii) Pay and bear all charges incurred
in placing the shipment actually on
board;
(3) Provide a clean ship’s receipt or
on-board ocean bill of lading;
(4) Be responsible for any loss of and/
or damage to the goods occurring before delivery of the shipment on board
the ocean vessel; and
(5) At the Government’s request and
expense, assist in obtaining the documents required for (i) exportation or
(ii) importation at destination.
(c) Contract clause. The contracting
officer shall insert in solicitations and
contracts the clause at 52.247–37, F.o.b.
Vessel, Port of Shipment, when the delivery term is f.o.b. vessel, port of shipment.
47.303–10 F.o.b. inland carrier, point
of exportation.
(a) Explanation of delivery term. F.o.b.
inland carrier, point of exportation
means free of expense to the Government, on board the conveyance of the
inland carrier, delivered to the specified point of exportation.
(b) Contractor responsibilities. The contractor shall—

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47.303–11

48 CFR Ch. 1 (10–1–16 Edition)

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(1)(i) Pack and mark the shipment to
comply with contract specifications; or
(ii) In the absence of specifications,
prepare the shipment for ocean transportation in conformance with carrier
requirements to protect the goods and
to ensure assessment of the lowest applicable transportation charge;
(2) Prepare and distribute commercial bills of lading;
(3)(i) Deliver the shipment in good
order and condition in or on the conveyance of the carrier on the date or
within the period specified; and
(ii) Pay and bear all applicable
charges,
including
transportation
costs, to the point of delivery specified
in the contract;
(4) Be responsible for any loss of and/
or damage to the goods occurring before delivery of the shipment to the
point of delivery specified in the contract; and
(5) At the Government’s request and
expense, assist in obtaining the documents required for (i) exportation or
(ii) importation at destination.
(c) Contract clause. The contracting
officer shall insert in solicitations and
contracts the clause at 52.247–38, F.o.b.
Inland Carrier, Point of Exportation,
when the delivery term is f.o.b. inland
carrier, point of exportation.
47.303–11 F.o.b. inland point, country
of importation.
(a) Explanation of delivery term. F.o.b.
inland point, country of importation
means free of expense to the Government, on board the indicated type of
conveyance of the carrier, delivered to
the specified inland point where the
consignee’s facility is located.
(b) Contractor responsibilities. The contractor shall—
(1)(i) Pack and mark the shipment to
comply with contract specifications; or
(ii) In the absence of specifications,
prepare the shipment for ocean transportation in conformance with carrier
requirements to protect the goods;
(2)(i) Deliver, in or on the inland carrier’s conveyance, the shipment in
good order and condition to the specified inland point where the consignee’s
facility is located;
(ii) Pay and bear all applicable
charges incurred up to the point of delivery, including transportation costs;

export, import, or other fees or taxes;
costs of landing; wharfage costs; customs duties and costs of certificates of
origin; consular invoices; and other
documents that may be required for
importation; and
(3) Be responsible for any loss of and/
or damage to the goods until their arrival on or in the carrier’s conveyance
at the specified inland point.
(c) Contract clause. The contracting
officer shall insert in solicitations and
contracts the clause at 52.247–39, F.o.b.
Inland Point, Country of Importation,
when the delivery term is f.o.b. inland
point, country of importation.
47.303–12 Ex dock, pier, or warehouse,
port of importation.
(a) Explanation of delivery term. Ex
dock, pier, or warehouse, port of importation means free of expense to the Government delivered on the designated
dock or pier or in the warehouse at the
specified port of importation.
(b) Contractor responsibilities. The contractor shall—
(1)(i) Pack and mark the shipment to
comply with contract specifications; or
(ii) In the absence of specifications,
prepare the shipment for ocean transportation in conformance with carrier
requirements to protect the goods;
(2)(i) Deliver shipment in good order
and condition; and
(ii) Pay and bear all charges up to
the point of delivery specified in the
contract,
including
transportation
costs; export, import, or other fees or
taxes; costs of wharfage and landing, if
any; customs duties; and costs of certificates of origin, consular invoices, or
other documents that may be required
for exportation or importation; and
(3) Be responsible for any loss of and/
or damage to the goods occurring before delivery of the shipment to the
point of delivery specified in the contract.
(c) Contract clause. The contracting
officer shall insert in solicitations and
contracts the clause at 52.247–40, Ex
Dock, Pier, or Warehouse, Port of Importation, when the delivery term is ex
dock, pier, or warehouse, port of importation.

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Federal Acquisition Regulation
47.303–13

47.303–15

C.& f. destination.

(a) Explanation of delivery term. C.& f.
(cost & freight) destination means free of
expense to the Government delivered
on board the ocean vessel to the specified point of destination, with the cost
of transportation paid by the contractor.
(b) Contractor responsibilities. The contractor shall—
(1)(i) Pack and mark the shipment to
comply with contract specifications; or
(ii) In the absence of specifications,
prepare the shipment for ocean transportation in conformance with carrier
requirements;
(2)(i) Deliver the shipment in good
order and condition; and
(ii) Pay and bear all applicable
charges to the point of destination
specified in the contract, including
transportation costs and export taxes
or other fees or charges levied because
of exportation;
(3) Obtain and dispatch promptly to
the Government clean on-board ocean
bills of lading to the specified point of
destination;
(4) Be responsible for any loss of and/
or damage to the goods occurring before delivery; and
(5) At the Government’s request and
expense, provide certificates of origin,
consular invoices, or any other documents issued in the country of origin
or of shipment, or both, that may be
required for importation into the country of destination.
(c) Contract clause. The contracting
officer shall insert in solicitations and
contracts the clause at 52.247–41, C.&f.
Destination, when the delivery term is
c.& f. (Cost & freight) destination.

Lhorne on DSK30JT082PROD with CFR

[48 FR 42424, Sept. 19, 1983, as amended at 71
FR 206, Jan. 3, 2006]

47.303–14 C.i.f. destination.
(a) Explanation of delivery term. C.i.f.
(Cost, insurance, freight) destination
means free of expense to the Government delivered on board the ocean vessel to the specified point of destination, with the cost of transportation
and marine insurance paid by the contractor.
(b) Contractor responsibilities. The contractor’s responsibilities are the same
as those listed in 47.303–13(b), except

that, in addition, the contractor shall
obtain and dispatch to the Government
an insurance policy or certificate providing the amount and extent of marine insurance coverage specified in the
contract or agreed upon by the Government contracting officer.
(c) Contract clause. The contracting
officer shall insert in solicitations and
contracts the clause at 52.247–42, C.i.f.
(Cost, insurance, freight) Destination,
when the delivery term is c.i.f. destination.
[48 FR 42424, Sept. 19, 1983, as amended at 71
FR 206, Jan. 3, 2006]

47.303–15 F.o.b. designated air carrier’s terminal, point of exportation.
(a) Explanation of delivery term. F.o.b.
designated air carrier’s terminal, point of
exportation means free of expense to the
Government loaded aboard the aircraft,
or delivered to the custody of the air
carrier (if only the air carrier performs
the loading), at the air carrier’s terminal specified in the contract.
(b) Contractor responsibilities. The contractor shall—
(1)(i) Pack and mark the shipment to
comply with contract specifications; or
(ii) In the absence of specifications,
prepare the shipment for air transportation in conformance with carrier requirements to protect the goods and to
ensure assessment of the lowest applicable transportation charge;
(2)(i) Deliver the shipment in good
order and condition into the conveyance of the carrier, or to the custody of
the carrier (if only the carrier performs
the loading), at the point of delivery
and on the date or within the period
specified in the contract; and
(ii) Pay and bear all applicable
charges up to this point;
(3) Provide a clean bill of lading and/
or air waybill;
(4) Be responsible for any loss of and/
or damage to the goods occurring before delivery of the goods to the point
specified in the contract; and
(5) At the Government’s request and
expense, assist in obtaining the documents required for the purpose of exportation.
(c) Contract clause. The contracting
officer shall insert in solicitations and
contracts the clause at 52.247–43, F.o.b.
Designated Air Carrier’s Terminal,

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47.303–16

48 CFR Ch. 1 (10–1–16 Edition)

Point of Exportation, when the delivery term is f.o.b. designated air carrier’s terminal, point of exportation.
[48 FR 42424, Sept. 19, 1983, as amended at 71
FR 206, Jan. 3, 2006]

Lhorne on DSK30JT082PROD with CFR

47.303–16 F.o.b. designated air carrier’s terminal, point of importation.
(a) Explanation of delivery term. F.o.b.
designated air carrier’s terminal, point of
importation means free of expense to
the Government delivered to the air
carrier’s terminal at the point of importation specified in the contract.
(b) Contractor responsibilities. The contractor shall—
(1)(i) Pack and mark the shipment to
comply with contract specifications; or
(ii) In the absence of specifications,
prepare the shipment for air transportation in conformance with carrier requirements to protect the goods;
(2) Prepare and distribute bills of lading or air waybills;
(3)(i) Deliver the shipment in good
order and condition to the point of delivery specified in the contract; and
(ii) Pay and bear all charges incurred
up to the point of delivery specified in
the contract, including transportation
costs; export, import, or other fees or
taxes; cost of landing, if any; customs
duties; and costs of certificates of origin, consular invoices, or other documents that may be required for exportation or importation; and
(4) Be responsible for any loss of and/
or damage to the goods until delivery
of the goods to the Government at the
designated air carrier’s terminal.
(c) Contract clause. The contracting
officer shall insert in solicitations and
contracts the clause at 52.247–44, F.o.b.
Designated Air Carrier’s Terminal,
Point of Importation, when the delivery term is f.o.b. designated air carrier’s terminal, point of importation.
47.303–17 Contractor-prepaid commercial bills of lading, small package
shipments.
(a) If it is advantageous to the Government, the contracting officer may
authorize the contractor to ship supplies, which have been acquired f.o.b.
origin, to domestic destinations, including DOD air and water terminals,
by common carriers on commercial

bills of lading. Such shipments shall
not exceed 150 pounds by commercial
air or 1,000 pounds by other commercial
carriers and shall not have a security
classification.
(b) The contracting officer may authorize the shipments under paragraph
(a) of this subsection to be consolidated
with the contractor’s own prepaid shipments for delivery to one or more destinations, if all appropriate f.o.b. origin
shipments under one or more Government contracts have been consolidated
initially. The contractor may be authorized to consolidate less-than-carload or less-than-truckload Government shipments with its own shipments so that the Government can
take advantage of lower carload or
truckload freight costs. The Government shall assume its pro rata share of
the combined shipment cost. Agency
transportation personnel shall evaluate
overall transportation costs before authorizing any movement to ensure savings to the Government consistent
with other contract and traffic management considerations. When consolidation is authorized, a copy of the commercial bill of lading shall be mailed
promptly to each consignee.
(c) Shipments under prepaid commercial bills of lading, as authorized in
paragraph (a) of this subsection, do not
require a contract modification. Unless
otherwise provided in the contract, the
supplies move for the account of, and
at the risk of, the Government. The
supplies become Government property
when loaded on the carrier’s equipment
and the contractor has obtained the
carrier’s receipt. The contractor pays
the transportation charges and is reimbursed by the Government. Loss or
damage claims shall be processed in accordance with agency regulations.
(d) The contractor’s invoice for reimbursement by the Government shall
show
the
prepaid
transportation
charges as agreed (see paragraph (b) of
this subsection), as a separate item for
each individual shipment. The contractor shall support the transportation charges with a copy of the carrier’s receipted freight bill or other
evidence of receipt, except as follows:
(1) A Government agency may determine that receipted freight bills or

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47.304–1

other evidence of receipt are not required for transportation charges of
$100 or less.
(2) A Government agency may pay an
invoiced but unsupported transportation charge of $250 or less per transaction (i.e., purchase, invoice, or aggregate billing or payment for multiple
purchases), if—
(i) The contractor cannot reasonably
provide a receipted freight bill; and
(ii) The agency has determined that
the charges are reasonable. Determination of reasonableness may be based
on—
(A) Past experience (authenticated
transportation charges for similar
shipments);
(B) Rate checks;
(C) Copies of previous freight bills
submitted by the contractor; or
(D) Other information submitted by
the contractor to substantiate the
amount claimed.
(3) Receipted freight bills in support
of invoiced transportation charges of
$100 or less are not required for reimbursement by the Government, if—
(i) The underlying contract specifies
retention by the contractor of all
records for at least 3 years after final
payment under the contract; and
(ii) The contractor agrees to furnish
evidence of payment when requested by
the Government.
(e) Shipments and invoices shall not
be split to reduce transportation
charges to $100 or less per transaction
as a means of avoiding the required
documented support for the charges.
See paragraph (d)(2) of this subsection
for unsupported transportation charges
of $250 or less.
(f) The contracting officer shall insert the clause at 52.247–65, F.o.b. Origin, Prepaid Freight-Small Package
Shipments, in solicitations and contracts when f.o.b. origin shipments are
to be made.
[55 FR 52796, Dec. 21, 1990, as amended at 62
FR 237, Jan. 2, 1997; 62 FR 64936, Dec. 9, 1997]

Lhorne on DSK30JT082PROD with CFR

47.304 Determination
terms.

of

delivery

47.304–1 General.
(a) The contracting officer shall determine f.o.b. terms generally on the
basis of overall costs, giving due con-

sideration to the criteria given in
47.304.
(b) Solicitations shall specify whether offerors must submit offers f.o.b. origin, f.o.b. destination, or both; or
whether offerors may choose the basis
on which they make an offer. The contracting officer shall consider the most
advantageous delivery point, such as
(1) f.o.b. origin, carrier’s equipment,
wharf, or specified freight station near
contractor’s plant; or (2) f.o.b. destination.
(c) In determining whether f.o.b. origin or f.o.b. destination is more advantageous to the Government, the contracting officer shall consider the
availability of lower freight rates (Government rate tenders) to the Government for f.o.b. origin acquisitions.
F.o.b. origin contracts also present
other desirable traffic management
features, in that they—
(1) Permit use of transit privileges
(see 47.305–13);
(2) Permit diversions to new destinations without price adjustment for
transportation (see 47.305–11);
(3) Facilitate use of special routings
or types of equipment (e.g., circuitous
routing or oversize shipments) (see
47.305–14);
(4) Facilitate, if necessary, use of premium cost transportation and permit
Government-controlled transportation;
(5) Permit negotiations for reduced
freight rates (see 47.104–1(b)); and
(6) Permit use of small shipment consolidation stations.
(d) When destinations are tentative
or unknown, the solicitation shall be
f.o.b. origin only (see 47.305–5).
(e) When the size or quantity of supplies with confidential or higher security classification requires commercial
transportation
services,
the
contracting officer shall generally specify
f.o.b. origin acquisitions.
(f) When acceptance must be at destination, solicitation shall be on an
f.o.b. destination only basis.
(g) Following are examples of situations when solicitations shall normally
be on an f.o.b. destination only basis
because it is advantageous to the Government (see 47.305–4):
(1) Bulk supplies, such as coal, that
require other than Government-owned
or operated handling, storage, and

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47.304–2

48 CFR Ch. 1 (10–1–16 Edition)

loading facilities, are destined for shipment outside CONUS.
(2) Steel or other bulk construction
products are destined for shipment outside CONUS.
(3) Supplies consist of forest products
such as lumber.
(4) Perishable or medical supplies are
subject to in-transit deterioration.
(5) Evaluation of f.o.b. origin offers is
anticipated to result in increased administrative lead time or administrative cost that would outweigh the potential advantages of an f.o.b. origin
determination.

from the point of origin within CONUS
to the overseas port destination. The
lowest cost of shipping can be determined only by evaluating and comparing the various prospective landed
costs (including inland, terminal, and
ocean costs). Also, agencies may have
export licensing privileges for shipments to foreign destinations. The contracting officer shall obtain advice
from the transportation officer to ensure full use of these privileges.

[48 FR 42424, Sept. 19, 1983, as amended at 68
FR 28084, May 22, 2003]

47.304–4 Shipments
side CONUS.

47.304–2 Shipments within CONUS.
(a) Solicitations shall provide that
offers may be submitted on the basis of
either or both f.o.b origin and f.o.b.
destination and that they will be evaluated on the basis of the lowest overall
cost to the Government.
(b) When sufficient reasons exist not
to follow this policy, the contract file
shall be documented to include the reasons.

(a) Unless there are valid reasons to
the contrary (see 47.304–5), acquisition
of supplies originating outside CONUS
for ultimate delivery to destinations
within CONUS or elsewhere, regardless
of the quantity of the shipments, shall
be on the basis of f.o.b. origin or f.o.b.
destination, whichever is more advantageous to the Government.
(b) The contracting officer shall request the advice of the transportation
officer to determine the most appropriate place of delivery to be specified
in acquisition documents, giving full
consideration to the possible use of
Government transportation facilities,
reduced rates available, special licensing or custom requirements, and availability of U.S.-flag shipping services
between the points involved (see subpart 47.5).

47.304–3 Shipments from CONUS for
overseas delivery.
(a) When Government acquisitions
involve shipments from CONUS to
overseas destinations, delivery f.o.b.
origin may afford not only the economies of lower freight rates available to
the Government within CONUS, but
also flexibility for selection of (1) the
port of export and (2) the ocean transportation providing the lowest overall
cost to the Government.
(b)(1) Unless there are valid reasons
to the contrary (see 47.304–5), acquisition of supplies originating within
CONUS for ultimate delivery to destinations outside CONUS shall be made
on the basis of f.o.b. origin. This policy
applies to supplies and equipment to be
shipped either directly to a port area
for export or to a storage or holding
area for subsequent forwarding to a
port area for export.
(2) Justification for the solicitation
of offers on other than an f.o.b. origin
basis shall be recorded and the contract file documented accordingly.
(c) Export cargo involves considerations of operational and cost factors

[48 FR 42424, Sept. 19, 1983, as amended at 68
FR 28084, May 22, 2003]

47.304–5

originating

Exceptions.

(a) Unusual conditions or circumstances may require the use of
terms other than f.o.b. origin or f.o.b.
destination. Such conditions or circumstances include, but are not limited to—
(1) Transportation disabilities at origin or destination;
(2) Mode of transportation required;
(3) Availability of Government or
commercial loading, unloading, or
transshipment facilities;
(4) Characteristics of the supplies;
(5) Trade customs related to certain
supplies;
(6) Origins or destinations in Alaska
and Hawaii; and
(7) Program requirements.

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Federal Acquisition Regulation

47.305–3

(b) Contracting officers shall obtain
assistance from transportation officers
before issuing solicitations when unusual conditions or circumstances exist
that relate to f.o.b. terms.

(i) Benefits available to the Government under transit arrangements made
by the offeror.
(j) Other requirements as stated
under specific section headings.

47.305 Solicitation provisions, contract
clauses, and transportation factors.

47.305–2 Solicitations f.o.b. origin and
f.o.b. destination—lowest overall
cost.
(a) Solicitations, when appropriate,
shall specify that offers may be f.o.b.
origin, f.o.b. destination, or both; and
that they will be evaluated on the basis
of the lowest overall cost to the Government.
(b) When offers are solicited on the
basis of both f.o.b. origin and f.o.b. destination, the contracting officer shall
insert in solicitations the provision at
52.247–45, F.o.b. Origin and/or F.o.b.
Destination Evaluation.

(a) The contracting officer shall coordinate transportation factors with
the transportation office during the
planning, solicitation, and award
phases of the acquisition process (see
47.105).
(b) To the extent feasible, activities
shall schedule deliveries to effect savings in transportation costs, and concomitant reductions in energy consumption by carriers (see 47.305–7 and
47.305–8 for specific possibilities).

Lhorne on DSK30JT082PROD with CFR

47.305–1

Solicitation requirements.

When the acquisition of supplies is on
f.o.b. origin or f.o.b. destination delivery terms, the contracting officer shall
include in solicitations a requirement
that the offeror furnish the Government as much of the following data as
is applicable to the particular acquisition:
(a) Modes of transportation and, if
rail transportation is used, names of
rail carriers serving the offeror’s facility.
(b) The number of railroad cars,
motor trucks, or other conveyances
that can be loaded per day.
(c) Type of packaging; e.g., box, carton, crate, drum, bundle, skids, and
when applicable, package number from
the governing freight classification.
(d) Number of units packed in one
container.
(e) Guaranteed maximum shipping
weight;
cubic
measurement;
and
length, width, and height of each container.
(f) Minimum size of each shipment.
(g) Number of containers or units
that can be loaded in a car, truck, or
other conveyance of the size normally
used (specify type and size) for the
commodity.
(h) Description of material in terms
of the governing freight classification
or tariff (or Government rate tender)
under which lowest freight rates are
applicable.

47.305–3 F.o.b. origin solicitations.
When preparing f.o.b. origin solicitations, the contracting officer shall
refer to 47.303, where f.o.b. origin
clauses relating to standard delivery
terms are prescribed. Supply solicitations that will or may result in f.o.b.
origin contracts shall also contain requirements, information, provisions,
and clauses concerning the following
items:
(a) Delivery in carload or truckload
lots f.o.b. carrier’s equipment, wharf,
or freight station.
(b) The requirement that the offeror
furnish the following information with
the offer:
(1) Location of the offeror’s actual
shipping point(s) (street address, city,
State, and ZIP code) from which supplies will be delivered to the Government.
(2) Whether the offeror’s shipping
point has a private railroad siding, and
the name of the rail carrier serving it.
(3) When the offeror’s shipping point
does not have a private siding, the
names and addresses of the nearest
public rail siding and of the carrier
serving it. (This will enable transportation officers, when issuing routing
instructions, to select the mode of
transportation that will provide the required service at the lowest possible
overall cost.)
(4)(i) The quantity of supplies to be
shipped from each shipping point.

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48 CFR Ch. 1 (10–1–16 Edition)

(ii) The contracting officer shall insert in f.o.b. origin solicitations the
provision at 52.247–46, Shipping Point(s)
Used in Evaluation of F.o.b. Origin Offers, when price evaluation for shipments from various shipping points is
contemplated.
(c) When delivery is f.o.b. origin, contractor’s facility, and the designated facility is not covered by the line-haul
transportation rate, the charges required to deliver the shipment to the
point where the line-haul rate is applicable.
(d) When delivery is f.o.b. origin,
freight allowed, the basis on which
transportation charges will be allowed,
including the origin and destination
from and to which transportation
charges will be allowed.
(e) If f.o.b. origin offers only are desired, a statement that offers submitted on any other basis will be rejected as nonresponsive.
(f)(1) The methods of transportation
used in evaluating offers. The Government normally uses land transportation by regulated common carriers
between points in the 48 contiguous
United States and the District of Columbia.
(2) The contracting officer shall insert the provision at 52.247–47, Evaluation—F.o.b. Origin, in solicitations
that require prices f.o.b. origin for the
purpose of establishing the basis on
which offers will be evaluated.
(g)(1) When it is believed that prospective contractors are likely to include in f.o.b. origin offers a contingency to compensate for what may be
an unfavorable routing condition by
the Government at the time of shipment, the contracting officer may permit prospective contractors to state in
offers a reimbursable differential that
represents the cost of bringing the supplies to any f.o.b. origin place of delivery specified by the Government at the
time of shipment (see the clause at
52.247–33, F.o.b. Origin, with Differentials).
(2) Following are situations that
might impose on the contractor a substantial cost above at plant or commercial shipping point prices because of
Government-required routings:
(i) The loading nature of the supplies;
e.g., wheeled vehicles.

(ii) The different methods of shipment specified by the Government;
e.g., towaway, driveaway, tri-level vehicle, or rail car, that may increase the
contractor’s cost in varying amounts
for bringing the supplies to, or loading
and bracing the supplies at, the specified place of delivery.
(iii) The contractor’s f.o.b. origin
shipping point is a port city served by
United States inland, coastwise, or
intercoastal water transportation, and
the contractor would incur additional
costs to make delivery f.o.b. a wharf in
that city to accommodate water routing specified by the Government.
(iv) The contractor’s plant does not
have a private rail siding and in order
to ship by Government-specified rail
routing, the contractor would be required to deliver the supplies to a public siding or freight terminal and to
load, brace, and install dunnage in rail
cars.
[48 FR 42424, Sept. 19, 1986, as amended at 51
FR 31426, Sept. 3, 1986; 71 FR 206, Jan. 3, 2006]

47.305–4 F.o.b. destination solicitations.
(a) When preparing f.o.b destination
solicitations, the contracting officer
shall refer to 47.303 for the prescription
of f.o.b. destination clauses relating to
standard delivery terms.
(b) If f.o.b. destination only offers are
desired, the solicitation shall state
that offers submitted on a basis other
than f.o.b. destination will be rejected
as nonresponsive.
(c) When supplies will or may be purchased f.o.b. destination but inspection
and acceptance will be at origin, the
contracting officer shall insert in solicitations and contracts the clause at
52.247–48, F.o.b. Destination—Evidence
of Shipment.
47.305–5 Destination unknown.
(a)(1) When destinations are unknown, solicitations shall be f.o.b. origin only.
(2) The contracting officer shall include in the contract file justifications
for such solicitations.
(b)(1) When the exact destination of
the supplies to be acquired is not
known, but the general location of the
users can be reasonably established,
the acquiring activity shall designate

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tentative destinations for the purpose
of computing transportation costs,
showing estimated quantities for each
tentative destination.
(2) The contracting officer shall insert in solicitations the provision at
52.247–49, Destination Unknown, when
destinations are tentative and only for
the purpose of evaluating offers.
(3) If it is necessary to control subsequent shipping weights, the solicitation shall state that subsequent shipments shall be made in carloads or
truckloads (see the clause at 52.247–59,
F.o.b. Origin—Carload and Truckload
Shipments).
(c)(1) When exact destinations are
not known and it is impracticable to
establish tentative or general delivery
places for the purpose of evaluating
transportation costs, the contracting
officer shall insert in solicitations the
provision at 52.247–50, No Evaluation of
Transportation Costs.
(2) The solicitation shall also state
that the transportation costs of subsequent shipments must be controlled
(see, for example, the clause at 52.247–
61, F.o.b. Origin—Minimum Size of
Shipments).

Lhorne on DSK30JT082PROD with CFR

47.305–6 Shipments to ports and air
terminals.
(a) When supplies are acquired on the
basis of the delivery terms in 47.303–8
through 47.303–16, the solicitation shall
include a requirement that the offeror
furnish the Government the following
information:
(1) When the delivery term is f.a.s.
vessel, port of shipment, f.o.b. vessel, port
of shipment, or f.o.b. inland carrier, point
of exportation, the required data shall
include—
(i) A delivery schedule in number of
units and/or long or short tons;
(ii) Maximum quantities available
per shipment;
(iii) The quantity that can be made
available for loading to vessel per running day of 24 hours (if acquisition involves a commodity to be shipped in
bulk);
(iv) The minimum leadtime required
to make supplies available for loading
to vessel; and
(v) The port and pier or other designation and, when applicable, the

maximum draft of vessel (in feet) that
can be accommodated.
(2) When the delivery term is f.o.b. inland point, country of importation or
f.o.b. designated air carrier’s terminal,
point of importation, the required data
shall include—
(i) A delivery schedule in number of
units and/or long or short tons;
(ii) Maximum quantities available
per shipment; and
(iii) Other data appropriate to shipment by air carrier.
(3) When the delivery term is ex dock,
pier, or warehouse, port of importation or
c.& f. (cost & freight) destination, the required data shall include—
(i) A delivery schedule in number of
units and/or long or short tons;
(ii) Maximum quantities available
per shipment; and
(iii) The number of containers or
units that can be loaded in a car,
truck, or other conveyance of the size
normally used (specify type and size)
for the commodity.
(4) When the delivery term is c.i.f.
(cost, insurance, freight) destination, the
required data shall include—
(i) The same as specified in 47.305–
6(a)(3); and
(ii) The amount and type of marine
insurance coverage; e.g., whether the
coverage is With Average or Free of Particular Average and whether it covers
any special risks or excludes any of the
usual risks associated with the specific
commodity involved.
(5) When the delivery term is f.o.b.
designated air carrier’s terminal, point of
exportation, the required data shall include—
(i) A delivery schedule in number of
units, type of package, and individual
weight and dimensions of each package;
(ii) Minimum leadtime required to
make supplies available for loading
into aircraft;
(iii) Name of airport and location to
which shipment will be delivered; and
(iv) Other data appropriate to shipment by air carrier.
(b) When supplies are acquired for
known destinations outside CONUS
and originate within CONUS, the contracting officer shall, for transportation evaluation purposes, note in the
solicitation the CONUS port of loading

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48 CFR Ch. 1 (10–1–16 Edition)

or point of exit (aerial or water) and
the water port of debarkation that
serves the overseas destination.
(c) The contracting officer may also,
for evaluation purposes, list in the solicitation other CONUS ports that
meet the eligibility criteria compatible
with the nature and quantity of the
supplies, their destination, type of carrier required, and specified overseas delivery dates. This permits offerors that
are geographically remote from the
port that normally serves the overseas
destination to be competitive as far as
transportation costs are concerned.
(d) Unless logistics requirements
limit the ports of loading to the ports
listed in the solicitation, the solicitation shall state that—
(1) Offerors may nominate additional
ports (including ports in Alaska and
Hawaii) more favorably located to
their shipping points; and
(2) These ports will be considered in
the evaluation of offers if they possess
all requisite capabilities of the listed
ports in relation to the supplies being
acquired.
(e) When supplies are to be exported
through CONUS ports and offers are solicited on an f.o.b. origin or f.o.b. destination basis, the contracting officer
shall insert in solicitations the provision at 52.247–51, Evaluation of Export
Offers. The contracting officer shall
use the provision with its—
(1) Alternate I, when the CONUS ports
of export are DOD water terminals;
(2) Alternate II, when offers are solicited on an f.o.b. origin only basis; or
(3) Alternate III, when offers are solicited on an f.o.b. destination only basis.
(f)(1) When the supplies are to move
in the Defense Transportation System
(DTS) (see 47.301–3), the contract shall
specify that—
(i) A Transportation Control Movement Document (TCMD) must be dispatched to the appropriate DOD air or
water clearance authority in accordance with DoD 4500.9–R, Defense Transportation Regulation, Part II, procedures for all shipments consigned to
DOD air or water terminal transshipment points; and
(ii) An Export Release must be obtained for supplies to be transshipped
via a water port of loading to overseas
destinations, except for shipments for

which an Export Release is not required, generally shipments of less
than 10,000 pounds, (see DoD 4500.9–R,
Defense Transportation Regulation,
Part II).
(2) When shipments will be consigned
to DOD air or water terminal transshipment points, the contracting officer shall insert in solicitations and
contracts the clause at 52.247–52, Clearance and Documentation Requirements—Shipments to DOD Air or
Water Terminal Transshipment Points.
(g) When a contract will not generate
any shipments that require an Export
Release, only the DOD CONUS ports
that serve the overseas destination
shall be listed in the solicitation, except that the responsible contracting
officer may limit the water ports listed
when such limitation is considered necessary to meet delivery or other requirements.
(h) The award shall specify the
United States ports of loading that afford the lowest overall cost to the overseas destination.
(i) When supplies will be from origins
outside CONUS to destinations either
within or outside CONUS, the contracting officer shall use the appropriate f.o.b. term and include evaluation-of-offers information.
(j) In furtherance of the Cargo Preference Act of 1954 (46 U.S.C. 1241(b)), to
encourage and foster the American
Merchant Marine, the port of delivery
of supplies originating outside the
United States and shipped by ocean
vessel shall be based on the availability of United States-flag vessels between the ports involved, unless the acquiring activity has given other specific instructions. (See subpart 47.5—
Ocean Transportation by U.S.-Flag
Vessels.)
(k) For application of the Fly America Act to the transportation of supplies and personnel when the Government is responsible for the transportation costs, see subpart 47.4—Air
Transportation by U.S.-Flag Carriers.
(l) Military and civilian agencies
shall obtain assistance from transportation offices in connection with all export shipments (see 47.105).
[48 FR 42424, Sept. 19, 1983, as amended at 59
FR 11383, Mar. 10, 1994; 71 FR 206, Jan. 3, 2006]

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47.305–7 Quantity analysis, direct delivery,
and
reduction
of
crosshauling and backhauling.
(a) Quantity analysis. (1) The requiring activity shall consider the acquisition of carload or truckload quantities.
(2) When additional quantities of the
supplies being acquired can be transported at lower unit transportation
costs or with a relatively small increase in total transportation costs,
with no impairment to the program
schedule, the contracting officer shall
ascertain from the requiring activity
whether there is a known requirement
for additional quantities. This may be
the case, for example, when the additional quantity could profitably be
stored by the activity for future use, or
could be distributed advantageously to
several using activities on the same
transportation route or in the same
geographical area.
(b) Direct delivery. When it is the
usual practice of a requiring activity
to acquire supplies in large quantities
for shipment to a central point and
subsequent distribution to using activities, as needed, consideration shall be
given, if sufficient quantities are involved to warrant scheduling direct delivery, to the feasibility of providing
for direct delivery from the contractor
to the using activity, thereby reducing
the cost of transportation and handling.
(c) Crosshauling and backhauling. The
contracting officer shall select distribution and transshipment facilities
intermediate to origins and ultimate
destinations to reduce crosshauling
and backhauling; i.e., the transportation of personal property of the same
kind in opposite directions or the return of the property to or through
areas previously traversed in shipment.
47.305–8 Consolidation of small shipments and the use of stopoff privileges.
(a) Consolidation of small shipments.
Consolidation of small shipments into
larger lots frequently results in lower
transportation costs. Therefore, the
contracting officer, after consultation
with the transportation office and the
activity requiring the supplies, may revise the delivery schedules to provide
for deliveries in larger quantities.

(b) Stopping for partial unloading.
When feasible, schedules for delivery of
supplies to multiple destinations shall
be consolidated and the stopoff privileges permitted under carrier tariffs
shall be used for partial unloading at
one or more points directly en route
between the point of origin and the last
destination.
47.305–9 Commodity description and
freight classification.
(a) Generally, the freight rate for
supplies is based on the rating applicable to the freight classification description published in the National Motor
Freight Classification (NMFC) (for carriers) and the Uniform Freight Classification (UFC) (for rail) filed with Federal and State regulatory bodies.
Therefore, the contracting officer shall
show in the solicitation a complete description of the commodity to be acquired and of packing requirements to
determine
proper
transportation
charges for the evaluation of offers. If
supplies cannot be properly classified
through reference to freight classification tariffs or if doubt exists, the contracting officer shall obtain the applicable freight classification from the
transportation office. In some situations prospective contractors have established an official freight classification description that can be applied.
(b)(1) When the supplies being acquired are new to the supply system,
nonstandard, or modifications of previously shipped items, and different
freight classifications may apply, the
contracting officer shall insert in solicitations the provision at 52.247–53,
Freight Classification Description.
(2) The contracting officer shall alert
the transportation officer to the possibility of negotiations for appropriate
freight classification ratings and reasonable transportation rates.
(c) The solicitation shall contain adequate descriptions of explosives and
other dangerous supplies according to
(1) the regular freight classification
and (2) the hazardous material description and hazard class as shown in 49
CFR 172.101.
(d) The contracting officer shall furnish the freight classification information developed in 47.305–9(a), (b), and (c)

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47.305–10

48 CFR Ch. 1 (10–1–16 Edition)

above to the contract administration
office.
[48 FR 42424, Sept. 19, 1983, as amended at 71
FR 206, Jan. 3, 2006]

Lhorne on DSK30JT082PROD with CFR

47.305–10 Packing, marking, and consignment instructions.
(a) Acquisition documents shall include packing and marking requirements necessary to prevent deterioration of supplies and damages due to the
hazards of shipping, handling, and storage, and, when appropriate, marking in
accordance with the requirements of 49
CFR 172.300.
(b) Contracts shall include complete
consignment and marking instructions
at the time the contract is awarded to
ensure that supplies are delivered to
proper destinations without delay. If
complete consignment information is
not initially known, the contracting
officer shall issue amended delivery instructions under the Changes clause of
the contract (see 43.205) as soon as the
information becomes known.
(c) If necessary to meet required delivery schedules, the contracting officer may issue instructions by telephone, teletype, or telegram. The contracting officer shall confirm these instructions in writing.
(d) Marking and consignment instructions for military shipments shall
conform to the current issue of MILSTD-129 (Military Standard Marking
for Shipment and Storage) and other
applicable DOD regulations. Shipments
for civilian agencies shall be marked as
specified in Federal Standard 123,
Marking for Domestic Shipment (Civil
Agencies).
47.305–11 Options in shipment and delivery.
Although the clauses prescribed in
subpart 43.2 allow certain changes to be
made in regard to shipment and delivery, it may be desirable to provide specifically for certain options in the solicitation. The Government may reserve the right to—
(a) Direct deliveries of all or part of
the contract quantity to destinations
or to consignees other than those specified in the solicitation and in the contract;
(b) Direct shipments in quantities
that may require transportation rates

different from those on which the contract price is based; and
(c) Direct shipments by a mode of
transportation other than that stipulated in the solicitation and in the contract.
[48 FR 42424, Sept. 19, 1983, as amended at 62
FR 237, Jan. 2, 1997]

47.305–12 Delivery of Government-furnished property.
(a)(1) When Government property is
furnished to a contractor and transportation costs to the Government are a
factor in the evaluation of offers, the
contracting officer shall include in the
solicitation a clear description of the
property, its location, and other information necessary for the preparation
of cost estimates.
(2) The contracting officer shall insert in solicitations and contracts the
clause at 52.247–55, F.o.b. Point for Delivery of Government-Furnished Property, when Government property is to
be furnished under a contract and the
Government will be responsible for
transportation
arrangements
and
costs.
(b) The contracting officer shall describe explosive and dangerous material according to (1) the regular freight
classification and (2) the hazardous material description and hazard class as
shown in 49 CFR 172.101.
47.305–13

Transit arrangements.

(a) Transit privileges. (1) Transit arrangements permit the stopping of a
carload or truckload shipment at a specific intermediate point en route to the
final destination for storage, processing, or other purposes, as specified
in carrier tariffs or rate tenders. A single through rate is charged from origin
to final destination plus a transit or
other related charge, rather than a
more expensive combination of rates to
and from the transit point.
(2) The contracting officer shall consider possible benefits available to the
Government through the use of existing transit arrangements or through
efforts to obtain additional transit
privileges from the carriers. Solicitations incorporating transit arrangements shall be restricted to f.o.b. origin offers, as f.o.b. destination offers

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Lhorne on DSK30JT082PROD with CFR

Federal Acquisition Regulation

47.305–16

can only quote fixed overall delivered
prices at first destination.
(3)(i) Traffic management personnel
shall furnish information and analyses
of situations in which transit arrangements may be beneficial. The quantity
to be awarded must be of sufficient
tonnage to ensure that carload/truckload shipments can be made by the
contractor, and there should be reasonable certainty that shipments out of
the transit point will be requested in
carload/truckload quantities.
(ii) The contracting officer shall insert in solicitations the provision at
52.247–56, Transit Arrangements, when
benefits may accrue to the Government
because transit arrangements may
apply.
(b) Transit credits. (1) In evaluations
of f.o.b. origin offers for large quantities of supplies that contractors normally have in process or storage at intermediate points, contracting officers
shall make use of contractors’ earned
commercial transit credits, which are
recorded with the carriers. A transit
credit represents the transportation
costs for a recorded tonnage from the
initial point to an intermediate point.
The remaining transportation charges
from the intermediate point to the
Government destination, because they
are based on through rates, are frequently lower than the transportation
charges that would apply for the same
tonnage if the intermediate point were
the initial origin point.
(2) If transit credits apply, the contract shall state that the contractor
shall ship the goods on prepaid commercial bills of lading, subject to reimbursement by the Government. The
contracting officer shall ensure that
this does not preclude a proper change
in delivery terms under the Changes
clause. The shipments move for the account and at the risk of the Government, as they become Government
property at origin.
(3) The contractor shall show the
transportation and transit charges as
separate amounts on the invoice for
each individual shipment. The amount
to be reimbursed by the Government
shall not exceed the amount quoted in
the offer.
(4) The contracting officer shall insert in solicitations and contracts the

clause at 52.247–57, Transportation
Transit Privilege Credits, when supplies are of such a nature, or when it is
the custom of the trade, that offerors
may have potential transit credits
available and the Government may reduce transportation costs through the
use of transit credits.
[48 FR 42424, Sept. 19, 1983, as amended at 71
FR 206, Jan. 3, 2006]

47.305–14

Mode of transportation.

Generally, solicitations shall not
specify a particular mode of transportation or a particular carrier. If the use
of particular types of carriers is necessary to meet program requirements,
the solicitation shall provide that only
offers involving the specified types of
carriers will be considered. The contracting officer shall obtain all specifications for mode, route, delivery,
etc., from the transportation office.
47.305–15 Loading responsibilities of
contractors.
(a)(1) Contractors are responsible for
loading, blocking, and bracing carload
shipments as specified in standards
published by the Association of American Railroads.
(2) The contracting officer shall insert in solicitations and contracts the
clause at 52.247–58, Loading, Blocking,
and Bracing of Freight Car Shipments,
when supplies may be shipped in carload lots by rail.
(b) If the nature of the supplies or
safety, environmental, or transportability factors require special methods
for securing the supplies on the carrier’s equipment, or if only a special
mode of transportation or type vehicle
is appropriate, the contracting officer
shall include in solicitations detailed
specifications that have been coordinated with the transportation office.
47.305–16

Shipping characteristics.

(a) Required shipping weights. The
contracting officer shall insert in solicitations and contracts the clause at
52.247–59, F.o.b. Origin—Carload and
Truckload Shipments, when it is contemplated that they may result in
f.o.b. origin contracts with shipments

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47.305–17

48 CFR Ch. 1 (10–1–16 Edition)

in carloads or truckloads. This will facilitate realistic freight cost evaluations of offers and ensure that contractors produce economical shipments of
agreed size.
(b) Guaranteed shipping characteristics.
(1) The contracting officer shall insert
in soliciations and contracts, excluding
those at or below the simplified acquisition threshold, the clause at 52.247–60,
Guaranteed Shipping Characteristics,
when shipping and other characteristics are required to evaluate offers as
to transportation costs. When all of the
shipping characteristics listed in paragraph (a) of the clause at 52.247–60 are
not required to evaluate offers as to
transportation costs, the contracting
officer shall delete the characteristics
not required from the clause.
(2) The award document shall show
the shipping characteristics used in the
evaluation.
(c) Minimum size of shipments. When
volume rates may apply, the contracting officer shall insert in solicitations and contracts the clause at
52.247–61, F.o.b. Origin—Minimum Size
of Shipments.
(d) Specific quantities unknown. (1)
When total requirements and destinations to which shipments will be made
are known, but the specific quantity to
be shipped to each destination cannot
be predetermined, solicitations shall
state that offers are to be submitted on
the basis of delivery f.o.b. origin and/or
f.o.b. destination and that offers will be
evaluated on both bases.
(2) The contracting officer shall insert in solicitations and contracts the
clause at 52.247–62, Specific Quantities
Unknown, when total requirements and
destinations to which shipments will
be made are known, but the specific
quantity to be shipped to each destination cannot be predetermined. This
clause protects the interests of both
the Government and the contractor
during the course of the performance of
the contract.

Lhorne on DSK30JT082PROD with CFR

[48 FR 42424, Sept. 19, 1983, as amended at 54
FR 48990, Nov. 28, 1989; 60 FR 34760, July 3,
1995; 61 FR 39190, July 26, 1996]

47.305–17 Returnable cylinders.
The contracting officer shall insert
the clause at 52.247–66, Returnable Cylinders, in a solicitation and contract

whenever the contract involves the
purchase of gas in contractor-furnished
returnable cylinders and the contractor retains title to the cylinders.
[59 FR 11386, Mar. 10, 1994]

47.306 Transportation factors in the
evaluation of offers.
When evaluating offers, contracting
officers shall consider transportation
and transportation-related costs as
well as the offerors’ shipping and receiving facilities.
47.306–1 Transportation
minations.

cost

When requesting the transportation
officer to assist in evaluating offers,
the contracting officer shall give the
transportation officer all pertinent
data, including the following information:
(a) A complete description of the
commodity being acquired including
packaging instructions.
(b) Planned date of award.
(c) Date of initial shipment.
(d) Total quantity to be shipped (including weight and cubic content, when
appropriate).
(e) Delivery schedule.
(f) Contract period.
(g) Possible use of transit privileges,
including stopoffs for partial loading or
unloading, or both.
47.306–2 Lowest overall transportation
costs.
(a) For the evaluation of offers, the
transportation officer shall give to the
contracting officer, and the contracting officer shall use, the lowest
available freight rates and related accessorial and incidental charges that
(1) are in effect on, or become effective
before, the expected date of the initial
shipment and (2) are on file or published on the date of the bid opening.
(b) If rates or related charges become
available after the bid opening or the
due date of offers, they shall not be
used in the evaluation unless they
cover transportation for which no applicable rates or accessorial or incidental costs were in existence at the
time of bid opening or due date of the
offers.

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Federal Acquisition Regulation

47.403–1

47.306–3 Adequacy of loading and unloading facilities.
(a) When determining the transportation capabilities of an offeror, the
contracting officer shall consider the
type and adequacy of the offeror’s shipping facilities, including the ability to
consolidate and ship in carload or
truckload lots.
(b) The contracting officer shall consider the type and adequacy of the consignee’s receiving facilities to avoid
shipping schedules that cannot be properly accommodated.

Subpart 47.4—Air Transportation
by U.S.-Flag Carriers
47.401

Definitions.

Lhorne on DSK30JT082PROD with CFR

As used in this subpart—
Air freight forwarder means an indirect air carrier that is responsible for
the transportation of property from
the point of receipt to the point of destination, and utilizes for the whole or
any part of such transportation the
services of a direct air carrier or its
agent, or of another air freight forwarder.
Gateway airport abroad means the airport from which the traveler last embarks en route to the United States or
at which the traveler first debarks incident to travel from the United
States.
Gateway airport in the United States
means the last U.S. airport from which
the traveler’s flight departs or the first
U.S. airport at which the traveler’s
flight arrives.
International air transportation means
transportation by air between a place
in the United States and a place outside the United States or between two
places both of which are outside the
United States.
United States means the 50 States, the
District of Columbia, and outlying
areas of the United States.
U.S.-flag air carrier means an air carrier holding a certificate under section
401 of the Federal Aviation Act of 1958
(49 U.S.C. 41102).
[48 FR 42424, Sept. 19, 1983, as amended at 66
FR 2134, Jan. 10, 2001; 68 FR 28084, May 22,
2003]

47.402

Policy.

Federal employees and their dependents, consultants, contractors, grantees, and others must use U.S.-flag air
carriers for U.S. Government-financed
international air travel and transportation of their personal effects or property, if available (section 5 of the International Air Transportation Fair Competitive Practices Act of 1974 (49 U.S.C.
40118) (Fly America Act)).
[68 FR 28084, May 22, 2003]

47.403 Guidelines for implementation
of the Fly America Act.
This section 47.403 is based on the
Guidelines for Implementation of the
Fly America Act (case number B–
138942), issued by the Comptroller General of the United States on March 31,
1981.
47.403–1 Availability
and
unavailability of U.S.-flag air carrier service.
(a) If a U.S.-flag air carrier cannot
provide the international air transportation needed or if the use of U.S.-flag
air carrier service would not accomplish an agency’s mission, foreign-flag
air carrier service may be deemed necessary.
(b) U.S.-flag air carrier service is
considered available even though—
(1) Comparable or a different kind of
service can be provided at less cost by
a foreign-flag air carrier;
(2) Foreign-flag air carrier service is
preferred by, or is more convenient for,
the agency or traveler; or
(3) Service by a foreign-flag air carrier can be paid for in excess foreign
currency (unless U.S.-flag air carriers
decline to accept excess or near excess
foreign currencies for transportation
payable only out of such monies).
(c) Except as provided in paragraph
47.403–1(a), U.S.-flag air carrier service
shall be used for U.S. Government-financed commercial foreign air travel if
service provided by U.S.-flag air carriers is available. In determining availability of a U.S.-flag air carrier, the
following scheduling principles shall be
followed unless their application would
result in the last or first leg of travel
to or from the United States being performed by a foreign-flag air carrier:

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47.403–2

48 CFR Ch. 1 (10–1–16 Edition)

(1) U.S.-flag air carrier service available at point of origin shall be used to
destination or, in the absence of direct
or through service, to the farthest
interchange point on a usually traveled
route.
(2) When an origin or interchange
point is not served by a U.S.-flag air
carrier, foreign-flag air carrier service
shall be used only to the nearest interchange point on a usually traveled
route to connect with U.S.-flag air carrier service.
(3) When a U.S.-flag air carrier involuntarily reroutes the traveler via a foreign-flag air carrier, the foreign-flag
air carrier may be used notwithstanding the availability of alternative
U.S.-flag air carrier service.
(d) For travel between a gateway airport in the United States and a gateway airport abroad, passenger service
by U.S.-flag air carrier shall not be
considered available if—
(1) The gateway airport abroad is the
traveler’s origin or destination airport
and the use of U.S.-flag air carrier
service would extend the time in a
travel status, including delay at origin
and accelerated arrival at destination,
by at least 24 hours more than travel
by a foreign-flag air carrier; or
(2) The gateway airport abroad is an
interchange point and the use of U.S.flag air carrier service would require
the traveler to wait 6 hours or more to
make connections at that point, or if
delayed departure from, or accelerated
arrival at, the gateway airport in the
United States would extend time in a
travel status by at least 6 hours more
than travel by a foreign-flag air carrier.
(e) For travel between two points
outside the United States, the rules in
paragraphs 47.403–1(a), (b), and (c) shall
be applicable, but passenger service by
a U.S.-flag air carrier shall not be considered to be reasonably available if—
(1) Travel by a foreign-flag air carrier
would eliminate two or more aircraft
changes en route;
(2) One of the two points abroad is
the gateway airport en route to or
from the United States and the use of
a U.S.-flag air carrier would extend the
time in a travel status by at least 6
hours more than travel by a foreignflag air carrier, including accelerated

arrival at the overseas destination or
delayed departure from the overseas
origin, as well as delay at the gateway
airport or other interchange point
abroad; or
(3) The travel is not part of the trip
to or from the United States and the
use of a U.S.-flag air carrier would extend the time in a travel status by at
least 6 hours more than travel by a foreign-flag air carrier including delay at
origin, delay en route, and accelerated
arrival at destination.
(f) For all short-distance travel under
either paragraph (d) or paragraph (e) of
47.403–1, U.S. air carrier service shall
not be considered available when the
elapsed traveltime on a scheduled
flight from origin to destination airport by foreign-flag air carrier is 3
hours or less and service by a U.S.-flag
air carrier would involve twice such
traveltime.
47.403–2 Air transport agreements between the United States and foreign
governments.
Nothing in the guidelines of the
Comptroller General (see 47.403) shall
preclude, and no penalty shall attend,
the use of a foreign-flag air carrier that
provides transportation under an air
transport agreement between the
United States and a foreign government, the terms of which are consistent with the international aviation
policy goals at 49 U.S.C. 1502(b) and
provide reciprocal rights and benefits.
47.403–3

Disallowance of expenditures.

(a) Agencies shall disallow expenditures for U.S. Government-financed
commercial international air transportation on foreign-flag air carriers unless there is attached to the appropriate voucher a memorandum adequately explaining why service by U.S.flag air carriers was not available, or
why it was necessary to use foreignflag air carriers.
(b) When the travel is by indirect
route or the traveler otherwise fails to
use available U.S.-flag air carrier service, the amount to be disallowed
against the traveler is based on the
loss of revenues suffered by U.S.-flag
air carriers as determined under the
following formula, which is prescribed

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Federal Acquisition Regulation

47.501

and more fully explained in 56 Comp.
Gen. 209 (1977):

Sum of U.S.-flag carrier
segment mileage,
authorized
× Fare payable
Sum of all segment
by Government
mileage, authorized

[48 FR 42424, Sept. 19, 1983, as amended at 53
FR 27468, July 20, 1988; 60 FR 48250, Sept. 18,
1995]

MINUS

Subpart 47.5—Ocean
Transportation by U.S.-Flag Vessels

[48 FR 42424, Sept. 19, 1983, as amended at 62
FR 237, Jan. 2, 1997]

Air freight forwarders.

(a) Agencies may use air freight forwarders that are engaged in international air transportation (49 U.S.C.
1301(24)(c)) for U.S. Government-financed movements of property. The
rule on disallowance of expenditures in
47.403–3(a) applies also to the air carriers used by these international air
freight forwarders.
(b) Agency personnel shall inform
international air freight forwarders
that to facilitate prompt payments of
their bills, they shall submit with their
bills (1) a copy of the airway bill or
manifest showing the air carriers used
and (2) justification for the use of foreign-flag air carriers similar to the one
shown in the clause at 52.247–63, Preference for U.S.-Flag Air Carriers.
[48 FR 42424, Sept. 19, 1983, as amended at 62
FR 237, Jan. 2, 1997]

Lhorne on DSK30JT082PROD with CFR

47.405

Contract clause.

The contracting officer shall insert
the clause at 52.247–63, ‘‘Preference for
U.S.-Flag Air Carriers, in solicitations
and contracts whenever it is possible
that U.S. Government-financed inter-

[48 FR 42424, Sept. 19, 1983, as amended at 55
FR 3886, Feb. 5, 1990]

47.501 Definitions.
As used in this subpart—
Dry bulk carrier means a vessel used
primarily for the carriage of shipload
lots of homogeneous unmarked nonliquid cargoes such as grain, coal, cement, and lumber.
Dry cargo liner means a vessel used
for the carriage of heterogeneous
marked cargoes in parcel lots. However, any cargo may be carried in these
vessels, including part cargoes of dry
bulk items or, when carried in deep
tanks, bulk liquids such as petroleum
and vegetable oils.
Foreign-flag vessel means any vessel of
foreign registry including vessels
owned by U.S. citizens but registered
in a nation other than the United
States.
Government vessel means a vessel
owned by the U.S. Government and operated directly by the Government or
for the Government by an agent or contractor, including a privately owned
U.S.-flag vessel under bareboat charter
to the Government.
Privately owned U.S.-flag commercial
vessel means a vessel (1) registered and
operated under the laws of the United
States, (2) used in commercial trade of

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EC03AP91.005

(c) The justification requirement is
satisfied by the contractor’s use of a
statement similar to the one contained
in the clause at 52.247–63, Preference
for U.S.-Flag Air Carriers. (See 47.405.)

47.500 Scope of subpart.
This subpart prescribes policy and
procedures for giving preference to
U.S.-flag vessels when transportation
of supplies by ocean vessel is required.
This subpart does not apply to the Department of Defense (DoD). Policy and
procedures applicable to DoD appear in
DFARS subpart 247.5.

EC03AP91.004

Sum of U.S.-flag carrier
segment mileage,
traveled
Through fare
×
Sum of all segment
payed
mileage, traveled

47.404

national air transportation of personnel (and their personal effects) or
property will occur in the performance
of the contract.’’ This clause does not
apply to contracts awarded using the
simplified acquisition procedures in
part 13 or contracts for commercial
items (see part 12).

47.502

48 CFR Ch. 1 (10–1–16 Edition)

the United States, (3) owned and operated by U.S. citizens, including a vessel
under voyage or time charter to the
Government, and (4) a Governmentowned vessel under bareboat charter
to, and operated by, U.S. citizens.
Tanker means a vessel used primarily
for the carriage of bulk liquid cargoes
such as liquid petroleum products, vegetable oils, and molasses.
U.S.-flag vessel when used independently means either a Government vessel or a privately owned U.S.-flag commercial vessel.

Lhorne on DSK30JT082PROD with CFR

[48 FR 42424, Sept. 19, 1983, as amended at 66
FR 2134, Jan. 10, 2001]

47.502 Policy.
(a) The policy of the United States
regarding the use of U.S.-flag vessels is
stated in the following acts:
(1) The Cargo Preference Act of 1904
(10 U.S.C. 2631), which requires the Department of Defense to use only U.S.flag vessels for ocean transportation of
supplies for the Army, Navy, Air Force,
or Marine Corps unless those vessels
are not available at fair and reasonable
rates.
(2) The Merchant Marine Act of 1936
(46 U.S.C. 1101), which declares it is the
policy of the United States to foster
the development and encourage the
maintenance of its merchant marine.
(3) The Cargo Preference Act of 1954
(46 U.S.C. 1241(b), which is Section
901(b) of the Merchant Marine Act).
Under this Act, Government agencies
acquiring, either within or outside the
United States, supplies that may require ocean transportation shall ensure
that at least 50 percent of the gross
tonnage of these supplies (computed
separately for dry bulk carriers, dry
cargo liners, and tankers) is transported on privately owned U.S.-flag
commercial vessels to the extent that
such vessels are available at rates that
are fair and reasonable for U.S.-flag
commercial vessels. This applies when
the supplies are—
(i) Acquired for the account of the
United States;
(ii) Furnished to, or for the account
of, a foreign nation without provision
for reimbursement;
(iii) Furnished for the account of a
foreign nation in connection with
which the United States advances

funds or credits, or guarantees the convertibility of foreign currencies; or
(iv) Acquired with advance of funds,
loans, or guaranties made by or on behalf of the United States.
(b) Additional policies providing preference for the use of U.S.-flag vessels
are contained in—
(1)
10
U.S.C.
2634
for
the
transporation of privately-owned vehicles belonging to service members
when making permanent change of station moves;
(2) 46 U.S.C. 1241(a) for official business travel by officers and employees of
the United States and for the transportation of their personal effects; and
(3) 46 U.S.C. 1241(e) for the transportation of motor vehicles owned by Government personnel when transportation is at Government expense or
otherwise authorized by law.
(c) The provisions of the Cargo Preference Act of 1954 may be temporarily
waived when the Congress, the President, or the Secretary of Defense declares that an emergency justifying a
temporary waiver exists and so notifies
the appropriate agency or agencies.
47.503

Applicability.

(a) Except as stated in paragraph (b)
below and in 47.504, the Cargo Preference Acts of 1904 and 1954 described
in 47.502(a) apply to the following cargoes:
(1) Supplies owned by the Government and in the possession of—
(i) The Government;
(ii) A contractor; or
(iii) A subcontractor at any tier.
(2) Supplies for use of the Government that are contracted for and require subsequent delivery to a Government activity but are not owned by the
Government at the time of shipment.
(3) Supplies not owned by the Government at the time of shipment that
are to be transported for distribution
to foreign assistance programs, but
only if these supplies are not acquired
or contracted for with local currency
funds (see 47.504(b)).
(b) Government-owned supplies to be
shipped commercially that are (1) in
the possession of a department, a contractor, or a subcontractor at any tier
and (2) for use of military departments

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Federal Acquisition Regulation

47.506

shall be transported exclusively in privately owned U.S.-flag commercial vessels if such vessels are available at
rates that are fair and reasonable for
U.S.-flag commercial vessels.
(c) The 50-percent requirement shall
not prevent the use of privately owned
U.S.-flag commercial vessels for transportation of up to 100 percent of the
cargo subject to the Cargo Preference
Act of 1954.

Lhorne on DSK30JT082PROD with CFR

47.504

Exceptions.

The policy and procedures in this
subpart do not apply to the following:
(a) Shipments aboard vessels as required or authorized by law or treaty.
(b) Ocean transportation between foreign countries of supplies purchased
with foreign currencies made available,
or derived from funds that are made
available, under the Foreign Assistance
Act of 1961 (22 U.S.C. 2353).
(c) Shipments of classified supplies
when the classification prohibits the
use of non-Government vessels.
(d) Subcontracts for the acquisition
of commercial items or commercial
components
(see
12.504(a)(1)
and
(a)(11)). This exception does not apply
to—
(1) Grants-in-aid shipments, such as
agricultural and food-aid shipments;
(2) Shipments covered under 46 U.S.C.
Appx 1241–1, such as those generated by
Export-Import Bank loans or guarantees;
(3) Subcontracts under—
(i) Government contracts or agreements for ocean transportation services; or
(ii) Construction contracts; or
(4) Shipments of commercial items
that are—
(i) Items the contractor is reselling
or distributing to the Government
without adding value (see FAR
12.501(b)). Generally, the contractor
does not add value to the items when it
subcontracts items for f.o.b. destination shipment; or
(ii) Shipped in direct support of U.S.
military—
(A) Contingency operations;
(B) Exercises; or
(C) Forces deployed in connection
with United Nations or North Atlantic

Treaty Organization humanitarian or
peacekeeping operations.
[48 FR 42424, Sept. 19, 1983, as amended at 60
FR 34760, July 3, 1995; 60 FR 48250, Sept. 18,
1995; 65 FR 24324, Apr. 25, 2000; 68 FR 13203,
Mar. 18, 2003; 71 FR 206, Jan. 3, 2006]
EDITORIAL NOTE: At 65 FR 36031, June 6,
2000, section 47.504 was amended in the first
sentence of paragraph (e) by removing ‘‘(see
12.504(a)(13))’’ and adding ‘‘(see 12.504(a)(11))’’.
However, prior to this amendment paragraph
(e) was redesignated as (d).

47.505

Construction contracts.

(a) Except as stated in paragraph (b)
below, construction contractors, including subcontractors and suppliers,
engaged in overseas work shall comply
with the policies and regulations in
this subpart.
(b) These requirements shall not
apply to military assistance, foreign
aid, or similar projects under the auspices of the U.S. Government when the
recipient nation furnishes, or pays for,
at least 50 percent of the transportation, in which event foreign-flag vessels may be used for a portion not to
exceed 50 percent of the gross tonnage
for the project.
47.506

Procedures.

(a) The contracting officer shall obtain assistance from the transportation
activity (see 47.105) in developing appropriate shipping instructions and delivery terms for inclusion in solicitations and contracts that may involve
ocean transportation of supplies subject to the requirements of the Cargo
Preference Act of 1954 (see 47.502(a)(3)).
(b) When the contractor notifies the
contracting officer that a privately
owned U.S.-flag commercial vessel is
not available, the contracting officer
shall seek assistance from the transportation activity.
(c) For purposes of determining the
availability of privately owned U.S.flag commercial vessels at fair and reasonable rates, rates filed and published
in accordance with the requirements of
the Federal Maritime Commission may
be accepted as fair and reasonable.
When applicable rates for charter cargoes are not in published tariffs, a determination as to whether the rates

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47.507

48 CFR Ch. 1 (10–1–16 Edition)

are fair and reasonable shall be obtained from the Maritime Administration.
(d) The Maritime Administration has
issued regulations (46 CFR 381) that require agencies to submit reports regarding ocean shipments. Contracting
officers shall follow agency regulations
when preparing, or furnishing information for, these reports.
47.507

Contract clauses.

(a)(1) Insert the clause at 52.247–64,
Preference for Privately Owned U.S.Flag Commercial Vessels, in solicitations and contracts that may involve
ocean transportation of supplies subject to the Cargo Preference Act of
1954. (For application of the Cargo
Preference Act of 1954, see 47.502(a)(3),
47.503(a), and 47.504.)
(2) If an applicable statute requires,
or if it has been determined under
agency procedures, that the supplies to
be furnished under the contracts must
be transported exclusively in privately
owned U.S.-flag commercial vessels
(see 47.502(a)(1) and 47.503(b)), use the
clause with its Alternate I.
(3) Except for contracts or agreements for ocean transportation services or construction contracts, use the
clause with its Alternate II if any of the
supplies to be transported are commercial items that are shipped in direct
support of U.S. military—
(i) Contingency operations;
(ii) Exercises; or
(iii) Forces deployed in connection
with United Nations or North Atlantic
Treaty Organization humanitarian or
peacekeeping operations.
(b) The contracting officer may insert in solicitations and contracts,
under agency procedures, additional
appropriate clauses concerning the vessels to be used.
[68 FR 13203, Mar. 18, 2003]

PART 48—VALUE ENGINEERING

Lhorne on DSK30JT082PROD with CFR

Sec.
48.000
48.001

Scope of part.
Definitions.

Subpart 48.1—Policies and Procedures
48.101
48.102

General.
Policies.

48.103 Processing value engineering change
proposals.
48.104 Sharing arrangements.
48.104–1 Determining sharing period.
48.104–2 Sharing acquisition savings.
48.104–3 Sharing collateral savings.
48.104–4 Sharing alternative—no-cost settlement method.
48.105 Relationship to other incentives.

Subpart 48.2—Contract Clauses
48.201 Clauses for supply or service contracts.
48.202 Clause for construction contracts.
AUTHORITY: 40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 51 U.S.C. 20113.
SOURCE: 48 FR 42443, Sept. 19, 1983, unless
otherwise noted.

48.000 Scope of part.
This part prescribes policies and procedures for using and administering
value engineering techniques in contracts.
48.001 Definitions.
As used in this subpart—
Acquisition savings means savings resulting from the application of a value
engineering change proposal (VECP) to
contracts awarded by the same contracting office of its successor for essentially the same unit. Acquisition
savings include—
(1) Instant contract savings, that are
the net cost reductions on the contract
under which the VECP is submitted
and accepted, and that are equal to the
instant unit cost reduction multiplied
by the number of instant contract
units affected by the VECP, less the
contractor’s allowable development
and implementation costs;
(2) Concurrent contract savings, that
are net reductions in the prices of
other contracts that are definitized and
ongoing at the time the VECP is accepted; and
(3) Future contract savings, that are
the product of the future unit cost reduction multiplied by the number of
future contract units in the sharing
base. On an instant contract, future
contract savings include savings on increases in quantities after VECP acceptance that are due to contract
modifications, exercise of options, additional orders, and funding of subsequent
year
requirements
on
a
multiyear contract.

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