FAR 47.101—Policies.
Plain-English Summary
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.
Key Rules
Commercial bills for domestic shipments
For domestic shipments, the contracting officer must authorize use of commercial bills of lading. Government bills of lading are reserved for international shipments, noncontiguous domestic trade shipments, or other situations specifically authorized.
Transportation management coordination
The contract administration office must ensure contractor instructions produce the most efficient and economical use of transportation services and equipment. Transportation personnel are expected to support the CAO with transportation management expertise and advice.
Traffic advice is required
The contracting officer must obtain traffic management advice and assistance when considering transportation factors in solicitations and awards, contract administration, modification, termination, and Government transportation of property to and from contractor plants.
Commercial carriers are preferred
The Government’s preferred method for transporting supplies is commercial carriers. Government-owned, leased, or chartered vehicles, aircraft, and vessels may be used only when they are available and not fully utilized, their use will produce substantial economies, and the use complies with all applicable statutes, agency policies, and regulations.
Limited uses for Government transport
When the required conditions are met, Government transportation assets may be used for local transfers between installations, pickup and delivery services not provided by commercial carriers, emergency shipments, and missions that cannot be accomplished using commercial carriers.
No transportation favoritism
Agencies may not give preferential treatment to any transportation mode or any particular carrier when awarding or administering supply contracts or transportation contracts, except where other FAR subparts specifically permit a particular mode.
Small business placement applies
Agencies must place purchases and contracts for transportation and transportation-related services with small business concerns as required by FAR part 19.
Statutory shipping preferences apply
Agencies must comply with Government-financed air transportation requirements, the Cargo Preference Act, and related statutes, including the rules in FAR subparts 47.4 and 47.5 governing U.S.-flag air and ocean transportation.
F.O.B. origin shipping documents
When a contract requires f.o.b. origin delivery and the Government pays transportation costs, the contractor must ship on bills of lading or other SDDC-prescribed shipping documents for seavan containers, using documents directed or furnished by the CAO or the appropriate agency transportation office.
Responsibilities
Contracting Officer
Authorize commercial bills of lading for domestic shipments; obtain traffic management advice and assistance when transportation factors affect solicitations, awards, administration, modifications, terminations, or Government movement of property; and ensure transportation-related decisions comply with applicable transportation rules and statutory preferences.
Contract Administration Office (CAO)
Issue or oversee contractor instructions so they lead to the most efficient and economical use of transportation services and equipment, and coordinate with transportation personnel and agency transportation offices as needed.
Transportation Personnel / Agency Transportation Office
Provide transportation management expertise, traffic management advice, and assistance to the CAO and contracting officer; furnish or direct the shipping documents needed for applicable f.o.b. origin shipments.
Agency
Avoid preferential treatment for any carrier or transportation mode; comply with small business placement requirements; and follow Government-financed air transportation, Cargo Preference Act, and related statutory requirements.
Contractor
When required under an f.o.b. origin, Government-paid transportation arrangement, make shipments on the prescribed bills of lading or other shipping documents provided or directed by the CAO or agency transportation office.
Practical Implications
This section forces early transportation planning. If the contracting officer does not involve transportation specialists, the Government can end up with higher freight costs, poor routing, or noncompliant shipping documents.
Commercial carriers are the default, so using Government vehicles or aircraft requires a real justification. Agencies should document availability, underutilization, cost savings, and legal authority before choosing Government-owned or chartered transportation.
The no-preference rule is important in both source selection and administration. Contracting teams should avoid language or practices that steer work to a favored carrier or mode unless another FAR provision specifically allows it.
F.O.B. origin contracts can create documentation problems if the contractor ships without the correct bill of lading or SDDC-prescribed forms. Agencies should make sure the right shipping documents are issued before shipment begins.
Transportation compliance is not just a logistics issue; it can affect statutory compliance under Fly America, cargo preference, and small business rules, so acquisition teams should coordinate with transportation and socioeconomic specialists early.
Official Regulatory Text
(a) For domestic shipments, the contracting officer shall authorize shipments on commercial bills of lading (CBL’s). Government bills of lading (GBL’s) may be used for international or noncontiguous domestic trade shipments or when otherwise authorized. (b) The contract administration office (CAO) shall ensure that instructions to contractors result in the most efficient and economical use of transportation services and equipment. Transportation personnel will assist and provide transportation management expertise to the CAO. Specific responsibilities and details on transportation management are located in the Federal Management Regulation at 41 CFR parts 102-117 and 102-118. (For the Department of Defense, DoD 4500.9-R, Defense Transportation Regulation.) (c) The contracting officer shall obtain traffic management advice and assistance (see 47.105 ) in the consideration of transportation factors required for- (1) Solicitations and awards; (2) Contract administration, modification, and termination; and (3) Transportation of property by the Government to and from contractors’ plants. (d) (1) The preferred method of transporting supplies for the Government is by commercial carriers. However, Government-owned, leased, or chartered vehicles, aircraft, and vessels may be used if- (i) They are available and not fully utilized; (ii) Their use will result in substantial economies; and (iii) Their use is in accordance with all applicable statutes, agency policies and regulations. (2) If the three circumstances listed in paragraph (d)(1) of this section apply, Government vehicles may be used for purposes such as- (i) Local transportation of supplies between Government installations; (ii) Pickup and delivery services that commercial carriers do not perform in connection with line-haul transportation; (iii) Transportation of supplies to meet emergencies; and (iv) Accomplishment of program objectives that cannot be attained by using commercial carriers. (e) Agencies shall not accord preferential treatment to any mode of transportation or to any particular carrier either in awarding or administering contracts for the acquisition of supplies or in awarding contracts for the acquisition of transportation. (See subparts 47.2 and 47.3 for situations in which the contracting officer is permitted to use specific modes of transportation.) (f) Agencies shall place with small business concerns purchases and contracts for transportation and transportation-related services as prescribed in part 19 . (g) Agencies shall comply with the requirements for Government-financed air transportation (commonly referred to as the Fly America Act), the Cargo Preference Act, and related statutes as prescribed in subparts 47.4 , Air Transportation by U.S.-Flag Carriers, and 47.5 , Ocean Transportation by U.S.-Flag Vessels. (h) When a contract specifies delivery of supplies f.o.b. origin with transportation costs to be paid by the Government, the contractor shall make shipments on bills of lading, or on other shipping documents prescribed by Military Surface Deployment and Distribution Command (SDDC) in the case of seavan containers, either at the direction of or furnished by the CAO or the appropriate agency transportation office.