FAR 36.103—Methods of contracting.
Plain-English Summary
FAR 36.103 explains the required contracting method for two specific types of construction-related acquisitions: construction contracts and architect-engineer (A-E) services. It tells contracting officers when they must use sealed bidding for construction, tying that decision to the conditions in FAR 6.401(a), and it also identifies an important exception for construction performed outside the United States and its outlying areas. In addition, it requires that A-E services be acquired by negotiation rather than sealed bidding, and that source selection for those services follow applicable law, FAR subpart 36.6, and agency regulations. In practice, this section matters because it limits the contracting officer’s discretion and ensures the acquisition method matches the nature of the work and the governing procurement rules. It also helps prevent improper use of price-only competition where qualifications and professional competence are central, especially for A-E work.
Key Rules
Use sealed bidding for qualifying construction
For a construction contract, the contracting officer must use sealed bid procedures when the conditions in FAR 6.401(a) are met. This makes sealed bidding the required method when the acquisition is suitable for that process under the general competition rules.
Overseas construction exception
The sealed bidding requirement does not apply if the construction contract will be performed outside the United States and its outlying areas. In that case, the contracting officer is not bound by this section to use sealed bidding and must look to the applicable overseas procurement rules.
Acquire A-E services by negotiation
Architect-engineer services must be acquired by negotiation, not sealed bidding. This reflects the professional and qualifications-based nature of A-E work, where selection is not based solely on price.
Follow source selection rules for A-E work
When selecting sources for A-E services, contracting officers must follow applicable law, FAR subpart 36.6, and agency regulations. These authorities govern the qualifications-based selection process and any agency-specific procedures.
Responsibilities
Contracting Officer
Determine whether a construction acquisition meets the conditions for sealed bidding under FAR 6.401(a), and use sealed bid procedures when required unless the work will be performed outside the United States and its outlying areas. For architect-engineer services, use negotiation and conduct source selection in accordance with applicable law, FAR subpart 36.6, and agency regulations.
Agency
Provide and enforce regulations and procedures that implement the statutory and FAR requirements for A-E source selection and any overseas construction acquisition rules that affect the contracting officer’s method choice.
Offerors/Contractors
Understand that construction solicitations may be competed by sealed bidding when the FAR conditions are met, while A-E services will be competed through a negotiated, qualifications-based process rather than a sealed-bid award.
Practical Implications
This section removes discretion in two common situations: qualifying construction generally goes to sealed bidding, while A-E services must be negotiated.
A common mistake is treating A-E services like ordinary price-driven construction work; that can lead to an improper source selection method and protest risk.
Another pitfall is overlooking the overseas exception for construction contracts performed outside the United States and its outlying areas, which changes the applicable method analysis.
Contracting officers should document the basis for choosing the method, especially when determining whether FAR 6.401(a) applies or whether an overseas exception is relevant.
For contractors, the key takeaway is that the competition format depends on the acquisition type: price-focused sealed bidding may apply to construction, but A-E awards depend on qualifications-based evaluation and negotiation.
Official Regulatory Text
(a) The contracting officer shall use sealed bid procedures for a construction contract if the conditions in 6.401 (a) apply, unless the contract will be performed outside the United States and its outlying areas. (See 6.401 (b)(2).) (b) Contracting officers shall acquire architect-engineer services by negotiation, and select sources in accordance with applicable law, subpart 36.6 , and agency regulations.