[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: 48CFR46]

[Page 857]
 
            TITLE 48--FEDERAL ACQUISITION REGULATIONS SYSTEM
 
                CHAPTER 1--FEDERAL ACQUISITION REGULATION
 
PART 46_QUALITY ASSURANCE--Table of Contents
 
                         Subpart 46.7_Warranties
 
Sec.  46.703  Criteria for use of warranties.

    The use of warranties is not mandatory. In determining whether a 
warranty is appropriate for a specific acquisition, the contracting 
officer shall consider the following factors:
    (a) Nature and use of the supplies or services. This includes such 
factors as--
    (1) Complexity and function;
    (2) Degree of development;
    (3) State of the art;
    (4) End use;
    (5) Difficulty in detecting defects before acceptance; and
    (6) Potential harm to the Government if the item is defective.
    (b) Cost. Warranty costs arise from--
    (1) The contractor's charge for accepting the deferred liability 
created by the warranty; and
    (2) Government administration and enforcement of the warranty (see 
paragraph (c) below).
    (c) Administration and enforcement. The Government's ability to 
enforce the warranty is essential to the effectiveness of any warranty. 
There must be some assurance that an adequate administrative system for 
reporting defects exists or can be established. The adequacy of a 
reporting system may depend upon such factors as the--
    (1) Nature and complexity of the item;
    (2) Location and proposed use of the item;
    (3) Storage time for the item;
    (4) Distance of the using activity from the source of the item;
    (5) Difficulty in establishing existence of defects; and
    (6) Difficulty in tracing responsibility for defects.
    (d) Trade practice. In many instances an item is customarily 
warranted in the trade, and, as a result of that practice, the cost of 
an item to the Government will be the same whether or not a warranty is 
included. In those instances, it would be in the Government's interest 
to include such a warranty.
    (e) Reduced requirements. The contractor's charge for assumption of 
added liability may be partially or completely offset by reducing the 
Government's contract quality assurance requirements where the warranty 
provides adequate assurance of a satisfactory product.