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FAR and DFARS › FAR Part 17: Special Contracting Methods › Subpart 17.1

FAR 17.109 Contract clauses.

The codified text (eCFR, as of 2026-10-02). Under the Revolutionary FAR Overhaul ↗, agencies follow class deviations with new text for many parts while the formal rules go through the Federal Register: check the solicitation and your contract's clauses, which rule.

In plain English

This section tells contracting officers which clauses to include in multiyear contracts. It requires the Cancellation Under Multiyear Contracts clause when a multiyear contract is planned, and it addresses when to use economic price adjustment clauses, including a required clause for certain service contracts. It matters because it determines which price-adjustment and cancellation terms appear in your contract.

Applies to: Contracting officers awarding multiyear contracts and service contracts

What it requires

  • Insert the clause at 52.217-2, Cancellation Under Multiyear Contracts, in solicitations and contracts when a multiyear contract is contemplated.
  • Add the clause at 52.222-43 when the contract includes the clause at 52.222-41, Service Contract Labor Standards.

Key terms: multiyear contract · economic price adjustment clause · cancellation · labor and material costs contingency · price adjustment

Written by AI from this section's text. A guide, not legal advice: the text below rules.

The text

(a) The contracting officer shall insert the clause at 52.217-2, Cancellation Under Multiyear Contracts, in solicitations and contracts when a multiyear contract is contemplated.

(b) Economic price adjustment clauses. Economic price adjustment clauses are adaptable to multiyear contracting needs. When the period of production is likely to warrant a labor and material costs contingency in the contract price, the contracting officer should normally use an economic price adjustment clause (see 16.203). When contracting for services, the contracting officer—

(1) Shall add the clause at 52.222-43, Fair Labor Standards Act and Service Contract Labor Standards—Price Adjustment (Multiple Year and Option Contracts), when the contract includes the clause at 52.222-41, Service Contract Labor Standards;

(2) May modify the clause at 52.222-43 in overseas contracts when laws, regulations, or international agreements require contractors to pay higher wage rates; or

(3) May use an economic price adjustment clause authorized by 16.203, when potential fluctuations require coverage and are not included in cost contingencies provided for by the clause at 52.222-43.

Sections it refers to

  • 52.217-2 Cancellation Under Multiyear Contracts.
  • 16.203 Fixed-price contracts with economic price adjustment.
  • 52.222-43 Fair Labor Standards Act and Service Contract Labor Standards—Price Adjustment (Multiple Year and Option Contracts).
  • 52.222-41 Service Contract Labor Standards.

Sections that refer to it

  • 52.217-2 Cancellation Under Multiyear Contracts.

← 17.108 Congressional notification. · 17.200 Scope of subpart. →

Rule changes for FAR Part 17

Source: eCFR, 48 CFR chapters 1 and 2 (GPO GovInfo bulk data) ↗. Plain words for the terms: glossary.

FAR 17.109 Contract clauses · SpendQuery