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FAR and DFARS › FAR Part 32: Contract Financing › Subpart 32.5

FAR 32.503-14 Protection of Government title.

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 explains that under the Progress Payments clause, the Government gets title to materials, work-in-process, finished goods, and other property covered by progress payments. The contracting officer must make sure that title is not weakened by other claims or liens, and if it is, the contractor is in violation of the contract. The contracting officer can suspend or reduce progress payments and may consult legal counsel about possible False Claims Act issues if an encumbrance is not disclosed.

Applies to: Government contractors receiving progress payments and the administrative contracting officer (ACO) overseeing them

What it requires

  • The ACO must ensure Government title to inventories is not compromised by other encumbrances.
  • If the ACO becomes aware of an arrangement or condition that would impair Government title, the ACO shall require additional protective provisions.
  • The contractor must not have any encumbrance that impairs Government title.
  • The contractor must disclose any existing encumbrance in the progress payments certification.

Key terms: Progress Payments clause · Government title · encumbrances · ACO · False Claims Act

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

The text

(a) Since the Progress Payments clause gives the Government title to all of the materials, work-in-process, finished goods, and other items of property described in paragraph (d) of the Progress Payments clause, under the contract under which progress payments have been made, the ACO must ensure that the Government title to these inventories is not compromised by other encumbrances. Ordinarily, the ACO, in the absence of reason to believe otherwise, may rely upon the contractor's certification contained in the progress payment request.

(b) If the ACO becomes aware of any arrangement or condition that would impair the Government's title to the property affected by progress payment, the ACO shall require additional protective provisions (see 32.501-5) to establish and protect the Government's title.

(c) The existence of any such encumbrance is a violation of the contractor's obligations under the contract, and the ACO may, if necessary, suspend or reduce progress payments under the terms of the Progress Payments clause covering failure to comply with any material requirement of the contract. In addition, if the contractor fails to disclose an existing encumbrance in the progress payments certification, the ACO should consult with legal counsel concerning possible violation of 31 U.S.C. 3729, the False Claims Act.

Sections it refers to

← 32.503-13 [Reserved] · 32.503-15 Application of Government title terms. →

Rule changes for FAR Part 32

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

FAR 32.503-14 Protection of Government title · SpendQuery