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48 CFR · Federal Acquisition Regulation and Defense supplement

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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.

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62 sections with “Penalty”: the first 40

  • FAR 42.709-4 Assessing the penalty.
    …is granted pursuant to 42.709-6, the cognizant contracting officer shall— (a) Assess the penalty in 42.709-2(a)(1), when the submitted cost is expressly unallowable under a cost principle in the FAR or an executive agency supplement that d…
  • FAR 42.709-6 Waiver of the penalty.
    …un); (b) The amount of the unallowable costs under the proposal which are subject to the penalty is $10,000 or less (i.e., if the amount of expressly or previously determined unallowable costs which would be allocated to the contracts spec…
  • FAR 32.904 Determining payment due dates.
    …ctive date of the contract settlement. (B) For the sole purpose of computing an interest penalty that might be due the contractor— (1) Government acceptance is deemed to occur constructively on the 7th day after the contractor delivers su…
  • FAR 32.907 Interest penalties.
    (a) Late payment. The designated payment office will pay an interest penalty automatically, without request from the contractor, when all of the following conditions, if applicable, have been met: (1) The designated billing office received…
  • FAR 52.229-4 Federal, State, and Local Taxes (State and Local Adjustments).
    …f this contract that the Contractor is required to pay or bear, including any interest or penalty, if the Contractor states in writing that the contract price does not include any contingency for such tax and if liability for such tax, inte…
  • FAR 52.229-6 Taxes—Foreign Fixed-Price Contracts.
    …f this contract that the Contractor is required to pay or bear, including any interest or penalty, if the Contractor states in writing that the contract price does not include any contingency for such tax and if liability for such tax, inte…
  • FAR 52.232-25 Prompt payment.
    …. The Government will take into account untimely notification when computing any interest penalty owed the Contractor. (i) Name and address of the Contractor. (ii) Invoice date and invoice number. (The Contractor should date invoices as c…
  • FAR 52.232-26 Prompt Payment for Fixed-Price Architect-Engineer Contracts.
    …ter receipt, with the reasons why it is not a proper invoice. When computing any interest penalty owed the Contractor, the Government will take into account if the Government notifies the Contractor of an improper invoice in an untimely man…
  • FAR 52.232-27 Prompt Payment for Construction Contracts.
    …ter receipt, with the reasons why it is not a proper invoice. When computing any interest penalty owed the Contractor, the Government will take into account if the Government notifies the Contractor of an improper invoice in an untimely man…
  • FAR 42.709-2 General.
    …ency supplement to the FAR, that defines the allowability of specific selected costs, the penalty is equal to— (i) The amount of the disallowed costs allocated to contracts that are subject to this section for which an indirect cost propos…
  • FAR 52.242-3 Penalties for Unallowable Costs.
    …t defines the allowability of specific selected costs, the Contractor shall be assessed a penalty equal to— (1) The amount of the disallowed cost allocated to this contract; plus (2) Simple interest, to be computed— (i) On the amount the…
  • FAR 15.407-1 Defective certified cost or pricing data.
    … of any overpayment plus interest on the overpayments. The Government is also entitled to penalty amounts on certain of these overpayments. Overpayment occurs only when payment is made for supplies or services accepted by the Government. Ov…
  • FAR 31.201-6 Accounting for unallowable costs.
    …it verification. (3) For any indirect cost in the selected sample that is subject to the penalty provisions at 42.709, the amount projected to the sampling universe from that sampled cost is also subject to the same penalty provisions. (4…
  • FAR 31.205-47 Costs related to legal and other proceedings.
    …the False Claims Act, 31 U.S.C., sections 3729-3731, or 41 U.S.C. chapter 87, Kickbacks. Penalty does not include restitution, reimbursement, or compensatory damages. Proceeding includes an investigation. (b) Costs incurred in connection…
  • FAR 52.209-7 Information Regarding Responsibility Matters.
    …ceeding, a finding of fault and liability that results in the payment of a monetary fine, penalty, reimbursement, restitution, or damages of $5,000 or more. (iii) In an administrative proceeding, a finding of fault and liability that resul…
  • DFARS 252.216-7004 Award Fee Reduction or Denial for Jeopardizing the Health or Safety of Government Personnel.
    …oceeding, a finding of fault or liability that results in the payment of a monetary fine, penalty, reimbursement, restitution, or damage of $5,000 or more. (C) In an administrative proceeding, a finding of fault and liability that results …
  • FAR 3.704 Policy.
    …fense, then the head of the contracting activity shall consider, in addition to any other penalty prescribed by law or regulation— (1) Declaring void and rescinding contracts, as appropriate, and recovering the amounts expended under the c…
  • FAR 16.402-3 Delivery incentives.
    …on). (b) Incentive arrangements on delivery should specify the application of the reward-penalty structure in the event of Government-caused delays or other delays beyond the control, and without the fault or negligence, of the contractor …
  • FAR 19.304 Small disadvantaged business status.
    …osed by section 16(d) of the Small Business Act, (15 U.S.C. 645(d)), as well as any other penalty authorized by law.
  • FAR 22.302 Liquidated damages and overtime pay.
    …nt Act of 1990 (28 U.S.C. 2461 Note), the Department of Labor adjusts this civil monetary penalty for inflation no later than January 15 each year. (b) If the contractor or subcontractor fails or refuses to comply with overtime pay require…
  • FAR 22.1501 Definitions.
    …work or service— (1) Exacted from any person under the age of 18 under the menace of any penalty for its nonperformance and for which the worker does not offer himself voluntarily; or (2) Performed by any person under the age of 18 pursua…
  • FAR 28.106-1 Bonds and bond related forms.
    …F 1414, Consent of Surety (see 28.106-5). (l) SF 1415, Consent of Surety and Increase of Penalty (see 28.106-3). (m) SF 1416, Payment Bond for Other Than Construction Contracts (see 28.103-3 and 28.106-3(b)). (n) SF 1418, Performance Bon…
  • FAR 28.106-3 Additional bond and security.
    …ety or sureties, agencies shall use Standard Form 1415, Consent of Surety and Increase of Penalty. Standard Form 1415 is authorized for local reproduction. (b) When additional bond coverage is required and is secured in whole or in part by…
  • FAR 31.110 Indirect cost rate certification and penalties on unallowable costs.
    …posals, penalties may be assessed. See 42.709 for administrative procedures regarding the penalty assessment provisions and the related contract clause prescription.
  • FAR 31.205-41 Taxes.
    …erest actually paid or credited to a contractor incident to a refund of tax, interest, or penalty shall be paid or credited to the Government only to the extent that such interest accrued over the period during which the contractor had been…
  • FAR 32.001 Definitions.
    …ontract financing payments for prompt payment purposes (i.e., not subject to the interest penalty provisions of the Prompt Payment Act in accordance with subpart 32.9). A commercial interim payment is given to the contractor after some work…
  • FAR 32.007 Contract financing payments.
    …eir respective offices received the request. (e) The Government will not pay an interest penalty to the contractor as a result of delayed contract financing payments.
  • FAR 32.202-2 Types of payments for commercial product and commercial service purchases.
    …ontract financing payments for prompt payment purposes (i.e., not subject to the interest penalty provisions of the Prompt Payment Act in accordance with subpart 32.9). These payments are not subject to subpart 32.4, Advance Payments for Ot…
  • FAR 32.604 Demand for payment.
    …ified in the demand for payment. (3) The basis for and amount of any accrued interest or penalty. (4)(i) For debts resulting from specific contract terms (e.g., debts resulting from incentive clause provisions, Quarterly Limitation on Pay…
  • FAR 32.608-2 Interest credits.
    …at some time during the period to which the interest charge applied, provided an interest penalty was not paid for such late payment. (b) Any appropriate interest credits shall be computed under the following procedures: (1) Interest at t…
  • FAR 32.905 Payment documentation and process.
    …gnated billing office must adjust the due date for the purpose of determining an interest penalty, if any. (c) Authorization to pay. All invoice payments, with the exception of interim payments on cost-reimbursement contracts for services,…
  • FAR 32.906 Making payments.
    …, may make payment on the following working day without incurring a late payment interest penalty. (4) When it is determined that the designated billing office erroneously rejected a proper invoice and upon resubmission of the invoice, wil…
  • FAR 32.1001 Policy.
    … payments are contract financing payments and, therefore, are not subject to the interest-penalty provisions of prompt payment (see Subpart 32.9). These payments shall be made in accordance with agency policy. (e) Performance-based payment…
  • FAR 33.202 Disputes.
    …of interest on contractor claims; (b) certification of contractor claims; and (c) a civil penalty for contractor claims that are fraudulent or based on a misrepresentation of fact.
  • FAR 42.709-5 Computing interest.
    …interest from the date of overpayment to the date of the demand letter for payment of the penalty. (d) Determine the paid portion of the disallowed costs in consultation with the contract auditor.
  • FAR 47.403-2 Air transport agreements between the United States and foreign governments.
    Nothing in the guidelines of the Comptroller General (see 47.403) shall preclude, and no penalty shall attend, the use of a foreign-flag air carrier that provides transportation under an air transport agreement between the United States and…
  • FAR 52.203-8 Cancellation, Rescission, and Recovery of Funds for Illegal or Improper Activity.
    …r paragraph (a) of this clause, the Government is entitled to recover, in addition to any penalty prescribed by law, the amount expended under the contract. (c) The rights and remedies of the Government specified herein are not exclusive, …
  • FAR 52.203-11 Certification and Disclosure Regarding Payments to Influence Certain Federal Transactions.
    …all be subject to civil penalties as provided in 31 U.S.C. 1352. An imposition of a civil penalty does not prevent the Government from seeking any other remedy that may be applicable. (End of provision)
  • FAR 52.203-12 Limitation on Payments to Influence Certain Federal Transactions.
    … be subject to civil penalties as provided for by 31 U.S.C.1352. An imposition of a civil penalty does not prevent the Government from seeking any other remedy that may be applicable. (2) Contractors may rely without liability on the repre…
  • FAR 52.212-3 Offeror Representations and Certifications—Commercial Products and Commercial Services.
    …work or service— (1) Exacted from any person under the age of 18 under the menace of any penalty for its nonperformance and for which the worker does not offer himself voluntarily; or (2) Performed by any person under the age of 18 pursua…

FAR (chapter 1)

DFARS (chapter 2, Defense)

Source: eCFR, 48 CFR chapters 1 and 2 (GPO GovInfo bulk data) ↗. Rule changes in progress: FAR, DFARS. Terms: glossary.