[Code of Federal Regulations]
[Title 48, Volume 1]
[Revised as of October 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 48CFR17.104]

[Page 319]
 
            TITLE 48--FEDERAL ACQUISITION REGULATIONS SYSTEM
 
                CHAPTER 1--FEDERAL ACQUISITION REGULATION
 
PART 17_SPECIAL CONTRACTING METHODS--Table of Contents
 
                   Subpart 17.1_Multiyear Contracting
 
Sec.  17.104  General.

    (a) Multiyear contracting is a special contracting method to acquire 
known requirements in quantities and total cost not over planned 
requirements for up to 5 years unless otherwise authorized by statute, 
even though the total funds ultimately to be obligated may not be 
available at the time of contract award. This method may be used in 
sealed bidding or contracting by negotiation.
    (b) Multiyear contracting is a flexible contract method applicable 
to a wide range of acquisitions. The extent to which cancellation terms 
are used in multiyear contracts will depend on the unique circumstances 
of each contract. Accordingly, for multiyear contracts, the agency head 
may authorize modification of the requirements of this subpart and the 
clause at 52.217-2, Cancellation Under Multiyear Contracts.
    (c) Agency funding of multiyear contracts shall conform to the 
policies in OMB Circulars A-11 (Preparation and Submission of Budget 
Estimates) and A-34 (Instructions on Budget Execution) and other 
applicable guidance regarding the funding of multiyear contracts. As 
provided by that guidance, the funds obligated for multiyear contracts 
must be sufficient to cover any potential cancellation and/or 
termination costs; and multiyear contracts for the acquisition of fixed 
assets should be fully funded or funded in stages that are economically 
or programmatically viable.
    (d) The termination for convenience procedure may apply to any 
Government contract, including multiyear contracts. As contrasted with 
cancellation, termination can be effected at any time during the life of 
the contract (cancellation is effected between fiscal years) and can be 
for the total quantity or partial quantity (where as cancellation must 
be for all subsequent fiscal years' quantities).

[61 FR 39204, July 26, 1996, as amended at 67 FR 13054, Mar. 20, 2002; 
67 FR 43514, June 27, 2002]