FAR 13.401—General.
Plain-English Summary
FAR 13.401 explains the general rule for the fast payment procedure under simplified acquisition procedures. It covers when the Government may pay a contractor before it has verified receipt and acceptance of supplies, what the contractor is certifying by submitting an invoice under this method, and the contractor’s obligation to replace, repair, or correct supplies that are not received, are damaged in transit, or do not conform to the purchase agreement. It also assigns primary responsibility to the contracting officer for determining the amount of debts that arise when the contractor fails to meet those replacement, repair, or correction obligations, with cross-references to FAR 32.602 and 32.603. In practice, this section matters because it speeds payment for routine supply purchases while shifting some risk away from the Government, so both sides must understand the certification effect of the invoice and the consequences if the supplies later prove defective or missing. It is a risk-management rule: the Government gets faster payment processing, and the contractor accepts a continuing obligation to make the Government whole if the shipment problem is discovered later.
Key Rules
Fast payment before acceptance
The fast payment procedure permits payment before the Government verifies that the supplies have been received and accepted. This is an exception to the normal pay-after-acceptance approach and is limited to the conditions allowed by the procedure.
Invoice acts as certification
When the contractor submits an invoice under fast payment, that invoice serves as a certification that the contractor has delivered the supplies to a post office, common carrier, or the Government’s first point of receipt. The invoice is not just a billing document; it is also the contractor’s statement that the shipment has been properly tendered for delivery.
Contractor must make things right
The contractor certifies that it will replace, repair, or correct supplies that are not received at destination, are damaged in transit, or do not conform to the purchase agreement. This creates an ongoing obligation even though payment may already have been made.
Debt determination by contracting officer
If the contractor fails to replace, repair, or correct the affected supplies, the contracting officer is primarily responsible for determining the amount of the resulting debt. The section points to FAR 32.602 and 32.603 for debt-related procedures.
Limited-condition payment method
Fast payment is not a general payment rule for all contracts; it applies only under the limited conditions described in the procedure. Agencies and contracting officers must ensure the method is used only where the risk and administrative controls are appropriate.
Responsibilities
Contracting Officer
Decide whether fast payment is appropriate for the acquisition, ensure the procedure is used only within its limited conditions, and determine the amount of any debt if the contractor fails to replace, repair, or correct the supplies. The contracting officer must also follow the debt procedures referenced in FAR 32.602 and 32.603.
Contractor
Submit an invoice that serves as a certification that the supplies were delivered to a post office, common carrier, or the Government’s first point of receipt, and honor the commitment to replace, repair, or correct supplies that are lost, damaged, or nonconforming.
Government Receiving Activity
Receive the shipment at the first point of receipt and later verify whether the supplies were actually received, damaged, or conforming, so any problems can be identified and reported for corrective action or debt recovery.
Agency
Use the fast payment procedure only where authorized and appropriate, and maintain internal controls that support prompt payment while protecting the Government’s ability to recover amounts owed if the contractor does not fulfill its obligations.
Practical Implications
Fast payment can improve cash flow for contractors and reduce administrative burden for the Government, but it also means payment may be made before full inspection or acceptance is complete.
Contractors should treat the invoice as a certification, not a routine billing form, because inaccurate delivery statements or failure to correct problems can create debt liability.
Contracting officers need to document and monitor use of the procedure carefully, especially when shipments are lost, damaged, or rejected after payment has already been made.
A common pitfall is assuming payment means the Government has accepted the supplies; under fast payment, acceptance may still be pending when payment is issued.
Another risk area is weak follow-up on nonconforming or missing supplies, which can delay debt determination and recovery under the referenced debt procedures.
Official Regulatory Text
(a) The fast payment procedure allows payment under limited conditions to a contractor prior to the Government’s verification that supplies have been received and accepted. The procedure provides for payment for supplies based on the contractor’s submission of an invoice that constitutes a certification that the contractor- (1) Has delivered the supplies to a post office, common carrier, or point of first receipt by the Government; and (2) Shall replace, repair, or correct supplies not received at destination, damaged in transit, or not conforming to purchase agreements. (b) The contracting officer shall be primarily responsible for determining the amount of debts resulting from failure of contractors to properly replace, repair, or correct supplies lost, damaged, or not conforming to purchase requirements (see 32.602 and 32.603 ).