FAR and DFARS › FAR Part 49: Termination of Contracts › Subpart 49.4
FAR 49.401 General.
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 termination for default is the Government's contractual right to end a contract, fully or partly, when the contractor fails or is expected to fail to meet its obligations. If the contractor was not actually in default or the failure was excusable, the termination is treated as one for the Government's convenience, changing the parties' rights and obligations. It also notes other termination or cancellation rights may apply and that a terminated contract can be reinstated with the contractor's written consent under certain conditions.
Applies to: Government contracts and contractors facing possible default termination
Key terms: termination for default · termination for convenience · excusable failure · contracting officer · reinstatement
Written by AI from this section's text. A guide, not legal advice: the text below rules.
The text
(a) Termination for default is generally the exercise of the Government's contractual right to completely or partially terminate a contract because of the contractor's actual or anticipated failure to perform its contractual obligations.
(b) If the contractor can establish, or it is otherwise determined that the contractor was not in default or that the failure to perform is excusable; i.e., arose out of causes beyond the control and without the fault or negligence of the contractor, the default clauses prescribed in 49.503 and located at 52.249 provide that a termination for default will be considered to have been a termination for the convenience of the Government, and the rights and obligations of the parties governed accordingly.
(c) The Government may, in appropriate cases, exercise termination or cancellation rights in addition to those in the contract clauses (see for example, paragraph (h) of the Default clause at 52.249-8).
(d) For default terminations of orders under Federal Supply Schedule contracts, see subpart 8.4.
(e) Notwithstanding the provisions of this 49.401, the contracting officer may, with the written consent of the contractor, reinstate the terminated contract by amending the notice of termination, after a written determination is made that the supplies or services are still required and reinstatement is advantageous to the Government.
← 49.305-2 Construction contracts. · 49.402 Termination of fixed-price contracts for default. →
Rule changes for FAR Part 49
- Federal Acquisition Regulation: Revolutionary Federal Acquisition Regulation Overhaul Parts 3 and 49 ↗ · proposed 2026-06-23 · comments due 2026-07-23
- Federal Acquisition Regulation; Technical Amendments ↗ · final rule 2024-12-16 · effective 2025-01-03
Source: eCFR, 48 CFR chapters 1 and 2 (GPO GovInfo bulk data) ↗. Plain words for the terms: glossary.