FAR 16.402-4 Structuring multiple-incentive contracts
Subsection Federal Acquisition Regulation
Facts
- Citation
- FAR 16.402-4
- Type
- Subsection
- Proposed changes
- 1
- Text as of
- FAC 2026-01
- Official text
- acquisition.gov
Text from acquisition.gov. Federal Register history from the Federal Register's records of the rules that amended this subsection.
Text
A properly structured multiple-incentive arrangement should-
(a) Motivate the contractor to strive for outstanding results in all incentive areas; and
(b) Compel trade-off decisions among the incentive areas, consistent with the Government’s overall objectives for the acquisition. Because of the interdependency of the Government’s cost, the technical performance, and the delivery goals, a contract that emphasizes only one of the goals may jeopardize control over the others. Because outstanding results may not be attainable for each of the incentive areas, all multiple-incentive contracts must include a cost incentive (or constraint) that operates to preclude rewarding a contractor for superior technical performance or delivery results when the cost of those results outweighs their value to the Government.
Proposed changes
| Proposed rule | Published | Comments |
|---|---|---|
| Federal Acquisition Regulation: Revolutionary Federal Acquisition Regulation Overhaul Parts 16, 17, and 35 | Closed Oct 19, 2026No final rule found |
Quick answers
What is FAR 16.402-4?
FAR 16.402-4 is a subsection of the Federal Acquisition Regulation, titled "Structuring multiple-incentive contracts".
Are changes to FAR 16.402-4 proposed?
One proposed change has no final rule yet.
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