Overview
This section provides the specific prescription for the inclusion of the mandatory bankruptcy notification clause in federal procurement documents based on a defined dollar threshold.
Key Rules
- Mandatory Clause: The Contracting Officer (CO) must insert the clause at FAR 52.242-13, Bankruptcy.
- Document Applicability: This requirement applies to both solicitations and awarded contracts.
- Dollar Threshold: The clause is required for all actions expected to exceed the Simplified Acquisition Threshold (SAT).
Practical Implications
- Reporting Obligation: Once this clause is included, contractors are legally obligated to notify the Contracting Officer in writing within five days of initiating bankruptcy proceedings.
- Risk Management: This rule allows the government to proactively manage risk and evaluate a contractor's ability to continue performance during financial restructuring.