FAR 52.246-18—Warranty of Supplies of a Complex Nature.
Plain-English Summary
FAR 52.246-18, Warranty of Supplies of a Complex Nature, sets out a specialized warranty framework for complex end items and related services when the Government needs stronger post-delivery protection than a simple inspection-and-acceptance regime. The clause defines key terms such as acceptance and supplies, establishes the contractor’s core warranty that delivered supplies will be free from defects in material and workmanship and will conform to contract requirements, and limits the warranty for Government-furnished property to proper installation unless the contractor modifies that property. It also addresses replacement or corrected items, the effect of Government-caused unavailability of facilities, tooling, drawings, or other equipment, the contractor’s duty to provide data and reports related to corrections, transportation costs for returned items, and the exclusion of implied warranties of merchantability and fitness for a particular purpose. On the Government side, the clause describes available remedies for breach, including repair, replacement, furnishing of materials and installation instructions, or an equitable price reduction. It further requires the Contracting Officer to specify notice periods, contractor response times, and the period for exercising warranty remedies, and it preserves the Government’s other contractual rights and remedies. In practice, this clause is important because it allocates post-delivery risk, sets clear timelines for defect notice and corrective action, and gives the Government a structured way to obtain repair or replacement without increasing contract price when complex supplies fail to meet requirements.
Key Rules
Acceptance and supplies defined
The clause defines acceptance as Government assumption of ownership or approval of services, and defines supplies as the end items and related services furnished under the contract. It expressly excludes data from the definition of supplies, which matters because the warranty applies to the physical items and related services, not to data as such.
Core warranty obligation
The contractor warrants that for the stated warranty period, all supplies will be free from defects in material and workmanship and will conform to all contract requirements. The Contracting Officer must insert the specific warranty period or the event that ends the warranty period, such as miles, hours of use, or a time period after delivery.
Government-furnished property limited warranty
For Government-furnished property, the contractor’s warranty generally covers only proper installation. If the contractor performs modification or other work on that property, the warranty extends to that modification or work, but not necessarily to the underlying Government-furnished item itself.
Corrected or replaced items remain covered
Any supplies or parts corrected or furnished in replacement are covered by the same warranty conditions as the original items. The warranty period for corrected or replaced items runs from the date those corrected or replacement items are delivered.
Government-caused unavailability excuse
The contractor is not required to correct or replace defective supplies if the Government has made unavailable the facilities, tooling, drawings, or other equipment or supplies needed to do the work. If correction or replacement is directed, the contractor must promptly notify the Contracting Officer in writing of the nonavailability.
Correction data and transportation costs
The contractor must provide data and reports related to any correction, including updates to affected contract data, at no increase in contract price. When supplies are returned to the contractor, the contractor bears transportation costs from the contract delivery point to the plant and back, regardless of FOB terms or point of acceptance.
Implied warranties excluded
The clause excludes implied warranties of merchantability and fitness for a particular purpose. This means the Government relies on the express warranty in the clause rather than on UCC-style implied warranty concepts.
Government remedies for breach
If the contractor breaches the warranty, the Government may require repair or replacement at no increase in contract price, or may require the contractor to furnish materials or parts and installation instructions so the Government can accomplish the correction. If correction or replacement is not required or not available, the Government is entitled to an equitable reduction in contract price.
Notice and response timelines
The Contracting Officer must insert deadlines for notifying the contractor of a breach, for the contractor to provide a written corrective-action recommendation, and for the period within which the Government may direct correction or replacement. The clause also requires separate notice periods for corrected or replaced supplies.
Government rights preserved
The clause states that its remedies are in addition to, and do not limit, any other rights the Government has under the contract. This preserves other contractual remedies, including those in other clauses, if they apply.
Responsibilities
Contracting Officer
Insert the specific warranty period or terminating event, the notice period for breach, the contractor response period, the period for directing remedies, and the notice period for corrected or replaced supplies. Determine whether to require repair, replacement, materials and instructions, or an equitable price reduction, and issue written notices and directions as required.
Contractor
Warrant that supplies will be free from defects and conform to contract requirements for the stated period; repair or replace defective or nonconforming supplies when directed; provide materials or parts and installation instructions if required; furnish correction-related data and reports without added contract price; bear transportation costs for returned items; and notify the Contracting Officer promptly if Government-caused unavailability prevents correction or replacement.
Government
Inspect and identify defects or nonconformities within the required notice periods; decide whether to seek repair, replacement, materials and instructions, or a price reduction; and provide access to any Government-furnished property, facilities, tooling, drawings, or other resources needed for contractor correction when the Government expects warranty performance.
Receiving/technical activity
Support identification of defects, document failures, coordinate return or correction logistics, and provide the information needed for warranty administration, including evidence of delivery dates, defect discovery, and any Government-caused constraints on correction.
Practical Implications
This clause is designed for complex items where failures may appear after acceptance, so contractors should track warranty start and end dates carefully and maintain records of delivery, use, and corrective actions.
The notice deadlines are critical. If the Contracting Officer misses the required notice window, the Government may lose the ability to invoke warranty remedies for that defect or for corrected items.
Contractors should pay close attention to Government-furnished property issues, because the warranty may be narrower than for contractor-furnished items and can be defeated if the Government withholds needed tooling, drawings, or facilities.
Transportation and correction costs can be significant. The clause places return shipping costs on the contractor when items are sent back, and correction must be done at no increase in contract price unless the contract is later equitably adjusted because no breach is found.
Because implied warranties are excluded, the express clause language and any inserted time periods control the parties’ rights, so poorly drafted blanks can create disputes over when notice is due and when remedies expire.
Official Regulatory Text
As prescribed in 46.710 (b)(1) , insert a clause substantially as follows: Warranty of Supplies of a Complex Nature (May 2001) (a) Definitions. As used in this clause- Acceptance means the act of an authorized representative of the Government by which the Government assumes for itself, or as an agent of another, ownership of existing and identified supplies, or approves specific services rendered, as partial or complete performance of the contract. Supplies means the end items furnished by the Contractor and related services required under this contract. The word does not include "data." (b) Contractor’s obligations. (1) The Contractor warrants that for ________ [ Contracting Officer shall state the specific warranty period after delivery, or the specified event whose occurrence will terminate the warranty period; e.g.,the number of miles or hours of use, or combinations of any applicable events or periods of time ] all supplies furnished under this contract will be free from defects in material and workmanship and will conform with all requirements of this contract; provided, however, that with respect to Government-furnished property, the Contractor’s warranty shall extend only to its proper installation, unless the Contractor performs some modification or other work on the property, in which case the Contractor’s warranty shall extend to the modification or other work. (2) Any supplies or parts thereof corrected or furnished in replacement shall be subject to the conditions of this clause to the same extent as supplies initially delivered. This warranty shall be equal in duration to that set forth in paragraph (b)(1) of this clause and shall run from the date of delivery of the corrected or replaced supplies. (3) The Contractor shall not be obligated to correct or replace supplies if the facilities, tooling, drawings, or other equipment or supplies necessary to accomplish the correction or replacement have been made unavailable to the Contractor by action of the Government. In the event that correction or replacement has been directed, the Contractor shall promptly notify the Contracting Officer, in writing, of the nonavailability. (4) The Contractor shall also prepare and furnish to the Government data and reports applicable to any correction required (including revision and updating of all affected data called for under this contract) at no increase in the contract price. (5) When supplies are returned to the Contractor, the Contractor shall bear the transportation costs from the place of delivery specified in the contract (irrespective of the f.o.b. point or the point of acceptance) to the Contractor’s plant and return. (6) All implied warranties of merchantability and "fitness for a particular purpose" are excluded from any obligation contained in this contract. (c) Remedies available to the Government. (1) In the event of a breach of the Contractor’s warranty in paragraph (b)(1) of this clause, the Government may, at no increase in contract price- (i) Require the Contractor, at the place of delivery specified in the contract (irrespective of the f.o.b. point or the point of acceptance) or at the Contractor’s plant, to repair or replace, at the Contractor’s election, defective or nonconforming supplies; or (ii) Require the Contractor to furnish at the Contractor’s plant the materials or parts and installation instructions required to successfully accomplish the correction. (2) If the Contracting Officer does not require correction or replacement of defective or nonconforming supplies or the Contractor is not obligated to correct or replace under paragraph (b)(3) of this clause, the Government shall be entitled to an equitable reduction in the contract price. (3) The Contracting Officer shall notify the Contractor in writing of any breach of the warranty in paragraph (b) of this clause within _____. [ Contracting Officer shall insert specific period of time in which notice shall be given to the Contractor; e.g.,"45days after delivery of the nonconforming supplies."; "45days of the last delivery under this contract."; or "45days after discovery of the defect." ] The Contractor shall submit to the Contracting Officer a written recommendation within _______ [ Contracting Officer shall insert period of time ] as to the corrective action required to remedy the breach. After the notice of breach, but not later than _________ [ Contracting Officer shall insert period within which the warranty remedies should be exercised ] after receipt of the Contractor’s recommendation for corrective action, the Contracting Officer may, in writing, direct correction or replacement as in paragraph (c)(1) of this clause, and the Contractor shall, notwithstanding any disagreement regarding the existence of a breach of warranty, comply with this direction. If it is later determined that the Contractor did not breach the warranty in paragraph (b)(1) of this clause, the contract price will be equitably adjusted. (4) If supplies are corrected or replaced, the period for notification of a breach of the Contractor’s warranty in paragraph (c)(3) of this clause shall be _________ [ Contracting Officer shall insert period within which the Contractor must be notified of a breach as to corrected or replaced supplies ] from the furnishing or return by the Contractor to the Government of the corrected or replaced supplies or parts thereof, or, if correction or replacement is effected by the Contractor at a Government or other activity, for ______ [ Contracting Officer shall insert period within which the Contractor must be notified of a breach of warranty as to corrected or replaced supplies ] thereafter. (5) The rights and remedies of the Government provided in this clause are in addition to and do not limit any rights afforded to the Government by any other clause of the contract. (End of clause) Alternate I [Reserved] Alternate II (Apr 1984) . If it is desirable to specify that necessary transportation incident to correction or replacement will be at the Government’s expense (as might be the case if, for example, the cost of a warranty would otherwise be prohibitive), substitute a paragraph substantially the same as the following paragraph (b)(5) for paragraph (b)(5) of the basic clause: (5) If correction or replacement is required and transportation of supplies in connection with correction or replacement is necessary, transportation charges and responsibility for the supplies while in transit shall be borne by the Government. Alternate III (Apr 1984) . If a fixed-price incentive contract is contemplated, add a paragraph substantially the same as the following paragraph (c)(6) to the basic clause: (6) All costs incurred or estimated to be incurred by the Contractor in complying with this clause shall be considered when negotiating the total final price under the Incentive Price Revision clause of this contract. After establishment of the total final price, Contractor compliance with this clause shall be at no increase in the total final price. Any equitable adjustments made under paragraph (c)(2) of this clause shall be governed by the paragraph entitled "Equitable Adjustments Under Other Clauses" in the Incentive Price Revision clause of this contract. Alternate IV (Apr 1984) . If it is anticipated that recovery of the warranted item will involve considerable Government expense for disassembly and/or reassembly of larger items, add a paragraph substantially the same as the following paragraph (c)(6) to the basic clause. Redesignate the additional paragraph as "(c)(7)" if Alternate III is also used: (6) The Contractor shall be liable for the reasonable costs of disassembly and/or reassembly of larger items when it is necessary to remove the supplies to be inspected and/or returned for correction or replacement.