SpendQueryBeta

FAR and DFARS › FAR Part 49: Termination of Contracts › Subpart 49.1

FAR 49.108-7 Government assistance in settling subcontracts.

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 allows the Government to help a prime contractor settle a subcontract in unusual cases, if the prime contractor agrees. Any resulting settlement agreement can involve the Government, the prime contractor, and the subcontractor, and the subcontractor is paid through the prime contractor as part of the overall settlement.

Applies to: Prime contractors and subcontractors in terminated contracts, with the TCO involved

What it requires

  • The subcontractor shall be paid through the prime contractor as part of the overall settlement with the prime contractor.

Key terms: TCO · prime contractor · subcontractor · settlement · Government assistance

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

The text

In unusual cases the TCO may determine, with the consent of the prime contractor, that it is in the Government's interest to provide assistance to the prime contractor in the settlement of a particular subcontract. In these situations, the Government, the prime contractor, and a subcontractor may enter into an agreement covering the settlement of one or more subcontracts. In these settlements, the subcontractor shall be paid through the prime contractor as part of the overall settlement with the prime contractor.

← 49.108-6 Delay in settling subcontractor settlement proposals. · 49.108-8 Assignment of rights under subcontracts. →

Rule changes for FAR Part 49

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

FAR 49.108-7 Government assistance in settling subcontracts · SpendQuery