Overview
FAR 32.400 defines the applicability of Subpart 32.4, establishing the regulatory framework for advance payments on both prime contracts and subcontracts. It clarifies that this subpart is limited to non-commercial transactions, distinguishing it from other specific payment categories.
Key Rules
- Applicability: Governing policies apply to advance payments for both prime contractors and subcontractors.
- Commercial Exclusion: This subpart does not govern commercial advance payments; those are exclusively covered under FAR Subpart 32.2.
- Specific Exceptions: The scope excludes specific transaction types identified in FAR 32.404 (such as rent, tuition, or subscriptions).
Practical Implications
- Regulatory Selection: Contracting Officers must first determine if an acquisition is for a commercial item to decide whether to follow the rules in Subpart 32.4 or Subpart 32.2.
- Compliance Mapping: Prime contractors flow down these specific requirements to subcontractors when advance payments are involved in non-commercial federal projects.