Overview
This section acknowledges that customary market practices for commercial products and services often involve buyer-provided financing and authorizes Contracting Officers to offer Government financing accordingly.
Key Rules
- Commercial Practice Recognition: The FAR recognizes that in the commercial marketplace, it is common for buyers to provide financing to sellers.
- Authority to Finance: Contracting Officers (COs) have the authority to provide Government financing for the acquisition of commercial products and services.
- Cross-Reference to Part 32: All Government financing for commercial items must be conducted in accordance with the established policies and procedures found in FAR Part 32 (specifically Subpart 32.2, "Commercial Product and Commercial Service Purchase Financing").
Practical Implications
- This allows the Government to be a more competitive buyer by offering payment terms (such as advance or interim payments) that align with standard industry norms.
- Contracting Officers must ensure that any financing terms offered are supported by market research confirming that such financing is a "customary market practice."