FAR 52.247-56—Transit Arrangements.
Plain-English Summary
FAR 52.247-56, Transit Arrangements, is a solicitation provision used when the Government may benefit from applying transit arrangements in evaluating transportation costs. It tells offerors and contracting personnel how to calculate the transportation component of evaluated price by using the lowest appropriate common carrier transportation costs, including any offeror-provided through transit rates and charges when those rates apply. The provision specifically addresses shipments from the offeror’s shipping points, through identified transit point(s), to the ultimate destination(s), and it requires the solicitation to identify the relevant transit point(s) and destination(s). In practice, this clause matters when transportation costs are part of the evaluation and a transit arrangement could reduce the Government’s evaluated cost, because it ensures offers are compared on a consistent, economically realistic basis. It is not a performance clause governing shipment after award; it is an evaluation provision that affects how offers are priced and compared before award. The clause helps the Government capture potential savings from established transit points, while also giving offerors notice of exactly how their transportation costs will be assessed.
Key Rules
Use only when beneficial
The provision is inserted in solicitations only when benefits may accrue to the Government because transit arrangements may apply. It is not a universal clause; it is used when the contracting activity expects transit routing or transit-point pricing to affect evaluated transportation costs.
Evaluate lowest appropriate carrier cost
The Government must use the lowest appropriate common carrier transportation costs in the evaluation. This means the evaluation is based on the most economical applicable common-carrier rate, rather than a higher or less favorable shipping cost.
Include through transit rates
If the offeror has through transit rates and charges that apply, those rates must be included in the evaluation. The clause recognizes that a through rate may be the proper basis for determining the total transportation cost from origin to destination.
Use shipping point to destination routing
Transportation costs are evaluated from the offeror’s shipping points, via the transit point, to the ultimate destination. The clause focuses on the actual routing structure identified in the solicitation, not on a generic or hypothetical shipping path.
Identify transit points and destinations
The solicitation must list the transit point(s) and destination(s) to which the evaluation will apply. This gives offerors clear notice of the routing assumptions used in price evaluation and prevents ambiguity in how transportation costs are calculated.
Applies to offer evaluation
This provision affects how offers are evaluated, not how the contractor must perform after award. Its function is to establish a fair and consistent method for comparing offers when transit arrangements can reduce transportation costs.
Responsibilities
Contracting Officer
Decide whether transit arrangements may produce Government savings and, if so, include the provision in the solicitation. Identify the applicable transit point(s) and destination(s), and ensure offers are evaluated using the lowest appropriate common carrier transportation costs, including applicable through transit rates and charges.
Offeror/Contractor
Provide pricing and transportation information that supports evaluation under the stated transit arrangement assumptions. If through transit rates apply, ensure they are available and accurately reflected so the Government can evaluate the offer on the correct basis.
Agency/Buying Activity
Establish solicitation requirements and evaluation assumptions that reflect the actual transit arrangement being considered. Support the contracting officer in determining when transit-point evaluation is appropriate and in documenting the basis for transportation-cost evaluation.
Practical Implications
This clause can materially change evaluated price when transportation is a significant cost element, so offerors should not assume the Government will evaluate only standard freight charges.
A common pitfall is failing to identify the correct transit point(s) or destination(s), which can lead to inconsistent evaluations or disputes over the proper routing basis.
Offerors should verify whether through transit rates are available and whether those rates are lower than separate origin-to-transit and transit-to-destination charges.
Contracting officers should document why the provision is being used and how the transportation-cost evaluation will be applied, especially if multiple shipping points or destinations are involved.
Because the clause is about evaluation, not performance, parties should avoid treating it as a shipment instruction after award unless the contract separately addresses transportation arrangements.
Official Regulatory Text
As prescribed in 47.305-13 (a)(3)(ii), insert the following provision in solicitations when benefits may accrue to the Government because transit arrangements may apply: Transit Arrangements (Apr 1984) The lowest appropriate common carrier transportation costs, including offeror’s through transit rates and charges when applicable, from offeror’s shipping points, via the transit point, to the ultimate destination will be used in evaluating offers. Transit Point(s) Destination(s) _______________ _______________ _______________ _______________ (End of clause)