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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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38 sections with “Performance-based contracting”

  • FAR 32.1007 Administration and payment of performance-based payments.
    (a) Responsibility. The contracting officer responsible for administering performance-based payments (see 42.302(a)(13)) for the contract shall review and approve all performance-based payments for that contract. (b) Approval of financing …
  • FAR 52.232-28 Invitation To Propose Performance-Based Payments.
    As prescribed in 32.1005(b)(1), insert the following provision: Invitation To Propose Performance-Based Payments (MAR 2000) (a) The Government invites the offeror to propose terms under which the Government will make performance-based con…
  • FAR 52.232-32 Performance-Based Payments.
    As prescribed in 32.1005, insert the following clause: Performance-Based Payments (APR 2012) (a) Amount of payments and limitations on payments. Subject to such other limitations and conditions as are specified in this contract and this c…
  • DFARS 252.232-7012 Performance-Based Payments—Whole-Contract Basis.
    As prescribed in 232.1005-70(a)(1), use the following clause: PERFORMANCE-BASED PAYMENTS—WHOLE-CONTRACT BASIS (DEC 2022) (a) Performance-based payments shall form the basis for the contract financing payments provided under this contract, …
  • DFARS 252.232-7013 Performance-Based Payments—Deliverable-Item Basis.
    As prescribed in 232.1005-70(a)(2), use the following clause: Performance-Based Payments—Deliverable-Item Basis (DEC 2022) (a) Performance-based payments shall form the basis for the contract financing payments provided under this contrac…
  • FAR 32.504 Subcontracts under prime contracts providing progress payments.
    (a) Subcontracts may include either performance-based payments, provided they meet the criteria in 32.1003, or progress payments, provided they meet the criteria in subpart 32.5 for customary progress payments, but not both. Subcontracts fo…
  • FAR 32.1001 Policy.
    (a) Performance-based payments are the preferred Government financing method when the contracting officer finds them practical, and the contractor agrees to their use. (b) Performance-based payments are contract financing payments that are…
  • FAR 32.1004 Procedures.
    Performance-based payments may be made either on a whole contract or on a deliverable item basis, unless otherwise prescribed by agency regulations. Financing payments to be made on a whole contract basis are applicable to the entire contra…
  • FAR 32.1008 Suspension or reduction of performance-based payments.
    …r reduction of payments, whenever exercising the Government's rights to suspend or reduce performance-based payments in accordance with paragraph (e) of the clause at 52.232-32, Performance-Based Payments.
  • FAR 32.1010 Risk of loss.
    (a) Under the clause at 52.232-32, Performance-Based Payments, and except for normal spoilage, the contractor bears the risk of loss for Government property, even though title is vested in the Government, unless the Government has expressly…
  • FAR 37.102 Policy.
    (a) Performance-based acquisition (see Subpart 37.6) is the preferred method for acquiring services (Public Law 106-398, section 821). When acquiring services, including those acquired under supply contracts or orders, agencies must— (1) U…
  • DFARS 215.404-71-3 Contract type risk and working capital adjustment.
    … (1) “No financing” means either that the contract does not provide progress payments or performance-based payments, or that the contract provides them only on a limited basis, such as financing of first articles. Do not compute a working …
  • DFARS 232.1001 Policy.
    (a) As with all contract financing, the purpose of performance-based payments is to assist the contractor in the payment of costs incurred during the performance of the contract. See PGI 232.1001(a) for additional information on use of perf…
  • DFARS 232.1004 Procedures.
    (b) Establishing performance-based finance payment amounts. (i) The contracting officer should include in a solicitation both the progress payments and performance-based payments provisions and clauses prescribed in this part, when consider…
  • DFARS 232.1005-70 Solicitation provisions and contract clauses.
    …e following clauses with appropriate fill-ins in solicitations and contracts that include performance-based payments: (1) For performance-based payments made on a whole-contract basis, use the clause at 252.232-7012, Performance-Based Paym…
  • DFARS 252.242-7005 Contractor business systems.
    …the Contracting Officer will withhold 5 percent of amounts due from progress payments and performance-based payments, and direct the Contractor, in writing, to withhold 5 percent from its billings on interim cost vouchers on cost-reimbursem…
  • FAR 7.105 Contents of written acquisition plans.
    …ition plans for service contracts or orders must describe the strategies for implementing performance-based acquisition methods or must provide rationale for not using those methods (see subpart 37.6). (a) Acquisition background and object…
  • FAR 37.103 Contracting officer responsibility.
    …contracts are exempt from the requirements of subparagraph (a)(3) above. (c) Ensure that performance-based acquisition methods are used to the maximum extent practicable when acquiring services. (d) Ensure that contracts for child care se…
  • DFARS 242.7000 Contractor business system deficiencies.
    …f payment withholding under 252.242-7005 does not exceed 10 percent of progress payments, performance-based payments, and interim payments under cost-reimbursement, labor-hour, and time-and-materials contracts billed under each of the ident…
  • FAR 32.1009 Title.
    (a) Since the clause at 52.232-32, Performance-Based Payments, gives the Government title to the property described in paragraph (f) of the clause, the contracting officer shall ensure that the Government title is not compromised by other e…
  • FAR 37.101 Definitions.
    …nd control usually prevailing in relationships between the Government and its employees. Performance-based contracting means structuring all aspects of an acquisition around the purpose of the work to be performed as opposed to either the …
  • FAR 52.232-16 Progress Payments.
    …ntractor becomes bankrupt or insolvent. (4) If the financing payments are in the form of performance-based payments, the terms of the subcontract or interdivisional order concerning payments— (i) Are substantially similar to the Performan…
  • FAR 2.101 Definitions.
    … or contractor's performance on active and physically completed contracts (see 4.804-4). Performance-based acquisition (PBA) means an acquisition structured around the results to be achieved as opposed to the manner by which the work is to…
  • FAR 8.405-2 Ordering procedures for services requiring a statement of work.
    …avel, special knowledge). To the maximum extent practicable, agency requirements shall be performance-based statements (see subpart 37.6). (c) Request for Quotation procedures. The ordering activity must provide the request for quotation (…
  • FAR 32.110 Payment of subcontractors under cost-reimbursement prime contracts.
    … 32.202-1 for commercial product or commercial service purchase financing, or 32.1003 for performance-based payments, as applicable. (b) If customary progress payments are made, the payments do not exceed the progress payment rate in 32.50…
  • FAR 32.1003 Criteria for use.
    The contracting officer may use performance-based payments for individual orders and contracts provided— (a) The contracting officer and offeror agree on the performance-based payment terms; (b) The contract, individual order, or line ite…
  • FAR 7.103 Agency-head responsibilities.
    …d to further refine requirements and acquisition strategies. For services, greater use of performance-based acquisition methods should occur for follow-on acquisitions. (u) Ensuring that acquisition planners, to the maximum extent practica…
  • FAR 8.405-3 Blanket purchase agreements (BPAs).
    …, and special knowledge). To the maximum extent practicable, agency requirements shall be performance-based statements (see subpart 37.6). (ii) Type-of-order preference. The ordering activity shall specify the order type (i.e., firm-fixed …
  • FAR 16.505 Ordering.
    …d within the period of performance, and be within the maximum value of the contract. (3) Performance-based acquisition methods must be used to the maximum extent practicable, if the contract or order is for services (see 37.102(a) and subp…
  • FAR 32.001 Definitions.
    …by the Government. (1) Contract financing payments include— (i) Advance payments; (ii) Performance-based payments; (iii) Commercial advance and interim payments; (iv) Progress payments based on cost under the clause at 52.232-16, Progr…
  • FAR 32.104 Providing contract financing.
    … agency procedures, the contracting officer may provide contract financing in the form of performance-based payments (see subpart 32.10) or customary progress payments (see subpart 32.5) if the following conditions are met: (1) The contrac…
  • FAR 39.104 Information technology services.
    …ncy— (a) Cannot be met without that requirement; or (b) Require the use of other than a performance-based acquisition (see subpart 37.6).
  • FAR 42.302 Contract administration functions.
    …prove or disapprove the contractor's requests for payments under the progress payments or performance-based payments clauses. (14) Make payments on assigned contracts when prescribed in agency acquisition regulations. (15) Manage special …
  • DFARS 207.106 Additional requirements for major systems.
    …or subsystem; and (v) Apply to weapon systems and subsystems that are to be supported by performance-based logistics arrangements as well as to weapon systems and subsystems that are to be supported by other sustainment approaches. (S-71)…
  • DFARS 232.007 Contract financing payments.
    …icer shall insert the standard due dates of 7 days for progress payments, and 14 days for performance-based payments and interim payments on cost-type contracts, in the appropriate paragraphs of the respective payment clauses. For interim p…
  • DFARS 245.102 Policy.
    … Government has acquired a lien or title solely because of partial, advance, progress, or performance-based payments; (G) Intellectual property or software; or (H) Real property. (5) Reporting Government property. It is DoD policy that a…
  • DFARS 252.232-7003 Electronic Submission of Payment Requests and Receiving Reports.
    …by the Government. (1) Contract financing payments include— (i) Advance payments; (ii) Performance-based payments; (iii) Commercial advance and interim payments; (iv) Progress payments based on cost under the clause at Federal Acquisit…
  • DFARS 252.232-7006 Wide Area WorkFlow Payment Instructions.
    …applicable.”) (** Contracting Officer: If the contract provides for progress payments or performance-based payments, insert the DoDAAC for the contract administration office assigned the functions under FAR 42.302(a)(13).) (4) Payment req…

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.