FAR 28.103-1—General.
Plain-English Summary
FAR 28.103-1 explains the basic government-wide rule for performance and payment bonds and when they may be required. It addresses three main topics: the general prohibition on requiring these bonds for non-construction contracts, the limited exceptions that allow their use under FAR 28.103-2 and 28.103-3, the timing requirement that a contractor must provide all required bonds before receiving a notice to proceed, and the rule that agencies may not add a bond requirement after award unless the need arises from a contract modification. In practice, this section protects contractors from unexpected bonding burdens on non-construction work, while preserving the Government’s ability to require bonds where the FAR specifically allows it. It also gives contracting officers a clear timing and documentation rule so that bonding is handled before performance starts, not after work is underway. For contractors, the section is important because it affects bid planning, financing, and the ability to mobilize on time. For agencies, it limits discretion and requires careful drafting of solicitations and contracts if bonding is intended.
Key Rules
No bonds for most non-construction work
Agencies generally may not require performance and payment bonds on contracts other than construction contracts. Any bond requirement for non-construction work must fit within the specific authority in FAR 28.103-2 or 28.103-3.
Limited exceptions still apply
Performance and payment bonds may be used only when the FAR permits them under the cited exceptions. The section does not create a broad authority to require bonds; it points to the specific rules that govern when they are allowed.
Bonds due before notice to proceed
If bonds are required, the contractor must furnish them before receiving a notice to proceed. This means the Government should not authorize performance to begin until the required bond package is in place.
No post-award surprise bond requirements
A bond cannot be required after award if the solicitation and contract did not specifically require it. The only exception is when a contract modification makes a bond necessary and the modification supports that requirement.
Contract modifications may change the need
If a later modification changes the scope or risk of the work, the contracting officer may determine that a bond is necessary for the modified effort. That determination must be tied to the modification, not to the original award.
Responsibilities
Contracting Officer
Ensure bond requirements are included only when authorized by the FAR and specifically stated in the solicitation and contract. Do not issue a notice to proceed until all required bonds are received, and do not add a bond requirement after award unless a contract modification justifies it.
Contractor
Provide all required bonds before starting work and before receiving the notice to proceed. Plan for bonding costs and timing early, and be prepared to furnish additional bonding only if a contract modification lawfully requires it.
Agency
Apply the general rule against requiring performance and payment bonds on non-construction contracts and use bond requirements only within the FAR’s permitted exceptions. Ensure internal procedures and contract templates do not impose unauthorized bonding requirements.
Practical Implications
For contractors, bonding should be treated as a pre-performance requirement, not something that can be delayed until after mobilization.
For contracting officers, the solicitation and contract must clearly state any bond requirement up front; leaving it out can prevent the Government from adding it later.
A notice to proceed should be withheld until all required bonds are acceptable, because starting work without them can create compliance and risk issues.
If the scope changes through a modification, the contracting officer should document why a bond is now necessary and ensure the requirement is limited to the modified work.
A common pitfall is assuming bond rules for construction automatically apply to service or supply contracts; this section says they generally do not.
Official Regulatory Text
(a) Generally, agencies shall not require performance and payment bonds for other than construction contracts. However, performance and payment bonds may be used as permitted in 28.103-2 and 28.103-3 . (b) The contractor shall furnish all bonds before receiving a notice to proceed with the work. (c) No bond shall be required after the contract has been awarded if it was not specifically required in the contract, except as may be determined necessary for a contract modification.