[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: 48CFR17.203]

[Page 324]
 
            TITLE 48--FEDERAL ACQUISITION REGULATIONS SYSTEM
 
                CHAPTER 1--FEDERAL ACQUISITION REGULATION
 
PART 17_SPECIAL CONTRACTING METHODS--Table of Contents
 
                          Subpart 17.2_Options
 
Sec.  17.203  Solicitations.

    (a) Solicitations shall include appropriate option provisions and 
clauses when resulting contracts will provide for the exercise of 
options (see 17.208).
    (b) Solicitations containing option provisions shall state the basis 
of evaluation, either exclusive or inclusive of the option and, when 
appropriate, shall inform offerors that it is anticipated that the 
Government may exercise the option at time of award.
    (c) Solicitations normally should allow option quantities to be 
offered without limitation as to price, and there shall be no limitation 
as to price if the option quantity is to be considered in the evaluation 
for award (see 17.206).
    (d) Solicitations that allow the offer of options at unit prices 
which differ from the unit prices for the basic requirement shall state 
that offerors may offer varying prices for options, depending on the 
quantities actually ordered and the dates when ordered.
    (e) If it is anticipated that the Government may exercise an option 
at the time of award and if the condition specified in paragraph (d) 
above applies, solicitations shall specify the price at which the 
Government will evaluate the option (highest option price offered or 
option price for specified requirements).
    (f) Solicitations may, in unusual circumstances, require that 
options be offered at prices no higher than those for the initial 
requirement; e.g., when (1) the option cannot be evaluated under 17.206, 
or (2) future competition for the option is impracticable.
    (g) Solicitations that require the offering of an option at prices 
no higher than those for the initial requirement shall--
    (1) Specify that the Government will accept an offer containing an 
option price higher than the base price only if the acceptance does not 
prejudice any other offeror; and
    (2) Limit option quantities for additional supplies to not more than 
50 percent of the initial quantity of the same contract line item. In 
unusual circumstances, an authorized person at a level above the 
contracting officer may approve a greater percentage of quantity.
    (h) Include the value of options in determining if the acquisition 
will exceed the Trade Agreements Act and North American Free Trade 
Agreement thresholds.

[48 FR 42231, Sept. 19, 1983, as amended at 53 FR 27464, July 20, 1988; 
58 FR 31141, May 28, 1993; 59 FR 545, Jan. 5, 1994; 64 FR 72419, Dec. 
27, 1999]