Overview
FAR 46.307 prescribes the use of the inspection clause for fixed-price research and development (R&D) contracts, specifically focusing on requirements where physical end items are the primary deliverable.
Key Rules
- Mandatory Insertion: Contracting officers must include clause 52.246-7, Inspection of Research and Development—Fixed-Price, when:
- The primary objective is the delivery of end items (excluding designs, drawings, or reports).
- The contract type is fixed-price.
- The contract value exceeds the Simplified Acquisition Threshold (SAT).
- Exceptions: The clause may be omitted if its use is impractical or if the short-form clause prescribed in FAR 46.309 is more appropriate for the specific acquisition.
- Discretionary Use: For R&D contracts at or below the SAT, the contracting officer has the discretion to include the clause if it serves the government's interest.
Practical Implications
- Contractors developing physical R&D prototypes under fixed-price terms must adhere to formal inspection standards that go beyond mere report submission.
- This regulation ensures that the government maintains quality control over hardware and tangible deliverables in a fixed-price environment, where the financial risk of non-conformance sits primarily with the contractor.