FAR 42.903—Solicitation provision and contract clause.
Plain-English Summary
FAR 42.903 is a very short but mandatory prescription that tells contracting officers when to include the Bankruptcy clause at FAR 52.242-13. It covers one topic only: the required use of the clause in solicitations and contracts that exceed the simplified acquisition threshold. In practice, this means the clause is not optional or left to discretion when the threshold is crossed; it must be inserted in both the solicitation and the resulting contract. The purpose is to protect the Government’s interests if a contractor becomes involved in bankruptcy proceedings, by ensuring the contract contains the standard rights and notice framework established in the clause. For contractors, this section signals that bankruptcy-related obligations and Government protections will apply on larger procurements. For contracting officers, it is a straightforward compliance requirement that should be checked as part of solicitation and award preparation.
Key Rules
Mandatory clause insertion
The contracting officer must insert FAR 52.242-13, Bankruptcy, in all solicitations and contracts that exceed the simplified acquisition threshold. There is no stated exception in this section.
Applies above threshold
The prescription is triggered by the simplified acquisition threshold, so it applies only when the procurement value is above that level. Below the threshold, this section does not require the clause.
Use in both documents
The clause must appear in the solicitation and in the contract. This means the requirement is not satisfied by including it only at award or only in the solicitation package.
Responsibilities
Contracting Officer
Ensure FAR 52.242-13, Bankruptcy, is included in every solicitation and contract exceeding the simplified acquisition threshold. Verify the clause is carried from solicitation to final contract documents.
Agency
Support acquisition templates, clause libraries, and review processes so required clauses are not omitted from covered procurements.
Contractor
Review the solicitation and contract to understand that the Bankruptcy clause applies and that bankruptcy-related notice and contract administration requirements may affect performance and rights.
Practical Implications
This is a simple compliance check, but omission can create contract administration risk and require corrective action after award.
Contracting officers should use clause checklists or automated templates to avoid missing the Bankruptcy clause on covered acquisitions.
Contractors should expect the clause on larger procurements and should assess how a bankruptcy filing could affect notice obligations, performance, and Government remedies.
Because the rule is threshold-based, the contracting team must confirm the current simplified acquisition threshold before deciding whether the clause is required.
The section does not describe the clause’s substantive terms; users must read FAR 52.242-13 itself to understand the bankruptcy rights and obligations it creates.
Official Regulatory Text
The contracting officer shall insert the clause at 52.242-13 , Bankruptcy, in all solicitations and contracts exceeding the simplified acquisition threshold.