FAR 47.1—Subpart 47.1

Policies.

FAR 47.101 sets the basic transportation policy framework for federal acquisitions. It covers when contracting officers must use commercial bills of lading versus Government bills of lading, how contract administration offices and transportation personnel should coordinate to achieve efficient and economical transportation, when contracting officers must seek traffic management advice, the preferred use of commercial carriers versus Government-owned, leased, or chartered transportation assets, the prohibition on giving preferential treatment to any transportation mode or carrier, the requirement to place transportation and transportation-related work with small business concerns when required by FAR part 19, compliance with statutory transportation preferences such as the Fly America Act and Cargo Preference Act, and special shipping documentation rules for f.o.b. origin contracts paid by the Government. In practice, this section is the policy backbone for deciding how supplies move, who advises on transportation issues, and what legal and administrative constraints apply to shipping arrangements. It matters because transportation choices affect cost, schedule, compliance, carrier selection, and the Government’s ability to meet mission needs without creating improper preferences or violating statutory shipping requirements. Contractors and contracting officers should read this section as a coordination and compliance rule set, not just a shipping instruction, because it ties together acquisition planning, contract administration, and transportation management. It also points readers to more detailed rules in other FAR parts and related regulations, especially the Federal Management Regulation and transportation-specific FAR subparts.

Transportation insurance.

FAR 47.102 explains when the Government does, and does not, insure Government property moving in commercial transportation. It covers the general rule that the Government keeps the risk of loss or damage to its property when that loss is not the legal liability of the carrier, and that it normally does not purchase insurance for property in the possession of commercial carriers. It then describes the narrow exception for special circumstances, where the Government may either buy insurance itself or require the carrier to accept full responsibility and insure that assumed liability, with the insurance cost treated as part of transportation cost. The section also points to Treasury regulations for shipments of valuables and requires the contracting officer to verify that any insurance purchase is legally permitted, funded, and properly documented. In practice, this section is about deciding who bears transportation risk, when insurance is justified, and how to make sure the contract file supports that decision.

Transportation Payment and Audit Regulation.

Government rate tenders under sections 10721 and 13712 of the Interstate Commerce Act (49 U.S.C. 10721 and 13712).

FAR 47.104 explains when and how certain common carriers may offer Government rate tenders to transport persons or property for the United States at no charge or at a reduced rate under 49 U.S.C. 10721 and 13712. It identifies the types of carriers covered—motor carriers, water carriers, freight forwarders, and rail carriers subject to Surface Transportation Board jurisdiction—and clarifies that the reduced-rate authority is implemented through a Government rate tender rather than an ordinary commercial contract rate. The section also points readers to related civilian and DoD transportation guidance in the Federal Management Regulation and the Defense Transportation Regulation, which are the practical operating references for many shipments. Most importantly, it limits and defines where reduced rates are authorized: rail transportation, household goods movements, and certain water carrier movements in noncontiguous domestic trade. In practice, this section matters because it tells agencies and carriers when statutory reduced-rate transportation is legally available and how to identify the correct commercial benchmark rate against which the Government discount is measured.

Transportation assistance.

FAR 47.105 explains where federal activities should go for transportation assistance when they need help with shipping, freight movement, routing, carrier issues, or other transportation-related matters. It distinguishes between civilian Government activities and military installations, and it identifies the specific offices that are responsible for providing that support. For civilian activities, the rule points to either the supporting GSA Regional Federal Supply Service Bureau or the transportation element of the designated contract administration office. For military installations, the default source is the transportation office of the contracting activity, unless another military activity has been assigned that role. The section also addresses escalation: military transportation offices are expected to seek additional help from the Military Surface Deployment and Distribution Command (SDDC) when needed. In practice, this section exists to make sure agencies know exactly where to obtain transportation expertise so contracts, shipments, and logistics issues are handled consistently and without delay.