FAR Part 16 revised to establish fixed-price contracts as default procurement type under EO 14402

Short summary

The FAR Council revised FAR Part 16 to make fixed-price contracts the default and preferred procurement type under EO 14402. Non-fixed-price contracts exceeding agency-specific thresholds now require agency head approval and written justification. Contractors face increased risk of limited pricing flexibility and should prepare for agencies to break requirements into fixed-price deliverables wherever possible.

• •Fixed-price contracts are now the default and preferred contract type under revised FAR Part 16
• •Non-fixed-price contracts above thresholds require agency head approval and written justification
• •Economic price adjustment clauses for fixed-price contracts are now more limited

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