What s the Difference Between Blanket Agreements and Basic Ordering Agreements

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Home > Contracting - Contingency > What s the difference

between Blanket Agreements and Basic Ordering Agreements?

Question and Answer Detail

Title - What s the difference between Blanket Agreements and Basic Ordering

Agreements?

Question -

What s the difference between Blanket Agreements and Basic

Ordering Agreements? Also, what s the difference between Basic

Ordering Agreements and Basic Agreements?

Scenario -

Posted - 10/1/2007 12:00:00 AM

Subject Area - Contracting - Contingency

Blanket Purchase Agreements circumstances for usage are

specified in FAR Part 13.303-2:

(a) The following are circumstances under which contracting

officers may establish BPAs:

(1) There is a wide variety of items in a broad class of

supplies or services that are generally purchased, but

the exact items, quantities, and delivery requirements

are not known in advance and may vary considerably.

(2) There is a need to provide commercial sources of

supply for one or more offices or projects in a given

area that do not have or need authority to purchase

otherwise.

(3) The use of this procedure would avoid the writing

of numerous purchase orders.

(4) There is no existing requirements contract for the

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What s the difference between Blanket Agreements and Basic Ordering Agreements? [AAP] https://dap.dau.mil/aap/pages/qdetails.aspx?cgiSubjectAreaID=22&cgiQuestionID=21379

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same supply or service that the contracting activity is

required to use.

Preparation of the BPA and Processing of orders is

established in FAR Part 13.303-3.

16.703 -- Basic Ordering Agreements

The Basic Ordering Agreement is explained in FAR Part 16.703

a) Description. A basic ordering agreement is a written instrument

of understanding, negotiated between an agency, contracting

activity, or contracting office and a contractor, that contains

(1) terms and clauses applying to future contracts

(orders) between the parties during its term,

(2) a description, as specific as practicable, of

supplies or services to be provided, and

(3) methods for pricing, issuing, and delivering future

orders under the basic ordering agreement . A

basic ordering agreement is not a contract.

(b) Application. A basic ordering agreement may be used to

expedite contracting for uncertain requirements for supplies or

services when specific items, quantities, and prices are not known

at the time the agreement is executed, but a substantial number of

requirements for the type of supplies or services covered by the

agreement are anticipated to be purchased from the contractor.

Under proper circumstances, the use of these procedures can

result in economies in ordering parts for equipment support by

reducing administrative lead-time, inventory investment, and

inventory obsolescence due to design changes.

Primarily, Blanket Purchase Agreements are used for actions

related to simplified acquisition and are processed with procedures

from Part 13 – Simplified Acquisition. Basic Ordering Agreements

are used for the higher dollar type actions similar to those of the

Blanket Purchase Agreement in the sense that it, like the BPA, is

an agreement and not a contract.

Please see FAR Part 13.3 regarding more information on BPAs


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and FAR Part 16.7 for more information on BOAs

The Basic Agreement is described in FAR Part 17.203 as follows:

16.702 -- Basic Agreements.

(a) Description. A basic agreement is a written instrument of

understanding, negotiated between an agency or contracting

activity and a contractor, that

(1) contains contract clauses applying to future

contracts between the parties during its term and

(2) contemplates separate future contracts that will

incorporate by reference or attachment the required

and applicable clauses agreed upon in the basic

agreement . A basic agreement is not a contract.

(b) Application. A basic agreement should be used when a

substantial number of separate contracts may be awarded to a

contractor during a particular period and significant recurring

negotiating problems have been experienced with the contractor.

Basic agreements may be used with negotiated fixed-price or

cost-reimbursement contracts.

(1) Basic agreements shall contain --

(i) Clauses required for negotiated

contracts by statute, executive order,

and this regulation and

(ii) Other clauses prescribed in this

regulation or agency acquisition

regulations that the parties agree to

include in each contract as applicable.

(2) Each basic agreement shall provide for


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discontinuing its future applicability upon 30 days’

written notice by either party.

(3) Each basic agreement shall be reviewed

annually before the anniversary of its effective date

and revised as necessary to conform to the

requirements of this regulation. Basic agreements

may need to be revised before the annual review due

to mandatory statutory requirements. A basic

agreement may be changed only by modifying the

agreement itself and not by a contract incorporating

the agreement.

(4) Discontinuing or modifying a basic agreement

shall not affect any prior contract incorporating the

basic agreement .

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What s the Difference Between Blanket Agreements and Basic Ordering Agreements

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