Authority
E.O. 14275, Restoring Common Sense to Federal Procurement; E.O. 14265, Modernizing Defense Acquisitions and Spurring Innovation in the Defense Industrial Base; OMB Memorandum M-25-26, Overhauling the Federal Acquisition Regulation
Summary
The deviation replaces Federal Acquisition Regulation (FAR) Part 43 and Defense FAR Supplement (DFARS) Part 243, Contract Modifications, with revised versions. Contracting officers must use the revised FAR Part 43 from the Revolutionary FAR Overhaul (RFO) web page and the attached DFARS Part 243 and DFARS Procedures, Guidance, and Information (PGI) 243. The deviation implements E.O. 14275, E.O. 14265 and OMB Memorandum M-25-26 to streamline federal procurement regulations.
Contracting Officer Actions
1
Effective 2026-02-01, use the revised FAR Part 43 from the RFO web page. It replaces the codified text at 48 CFR chapter 1.
2
Effective 2026-02-01, use the attached DFARS Part 243. It replaces the codified text at 48 CFR chapter 2.
3
Effective 2026-02-01, use the attached DFARS PGI 243. It replaces the PGI text on the Defense Pricing, Contracting, and Acquisition Policy web page.
4
Insert clause 252.243-7001, Pricing of Contract Modifications. Use in solicitations and contracts when anticipating and using a fixed-price type contract.
5
Insert clause 252.243-7002, Requests for Equitable Adjustment. Use in solicitations and contracts, including commercial (Part 12) acquisitions, estimated to exceed the simplified acquisition threshold.
6
Insert clauses prescribed at 217.7406 for unpriced change orders with an estimated value exceeding $5 million.
7
Do not pay a request for equitable adjustment exceeding the simplified acquisition threshold unless the contractor certifies the request per clause 252.243-7002.
8
For unpriced change orders exceeding $5 million, ensure definitization schedules provide for definitization within 180 days of issuance or by the date obligations reach 50 percent of the not-to-exceed price, whichever is earlier.
9
Do not obligate more than 50 percent of the not-to-exceed price on an unpriced change order before definitization. If the contractor submits a qualifying proposal before that threshold, you may increase the limit to 75 percent.
10
Include unpriced change orders exceeding $5 million in the Consolidated Undefinitized Contract Action (UCA) Management Report required by 217.7405.
11
When adding foreign military sale (FMS) requirements via modification, mark the front of the modification 'FMS Requirement' and reference each FMS case identifier code by line or subline item number.
12
Include a 'Summary for the Payment Office' in Section G or the contract schedule for each modification that obligates or deobligates funds. List prior obligations, the instant modification amount and the cumulative total.
Expiration
This deviation remains in effect until rescinded or incorporated into the FAR, DFARS and DFARS PGI. There is no fixed expiration date.
FMS and Special Access Programs
Unpriced change orders for FMS and special access programs are exempt from the definitization requirements at 243.370. Contracting officers must still apply the policy to the maximum extent practicable. Prior notice to the Office of the Principal Director, Defense Pricing, Contracting, and Acquisition Policy is required when adherence is impracticable.
Waiver Authority
The head of the agency may waive limitations on price ceiling, definitization schedule and obligations for unpriced change orders supporting a contingency operation or a humanitarian or peacekeeping operation.
Allowable Profit on Late Definitization
When a final price is negotiated after substantial performance, the head of the contracting activity must ensure profit reflects reduced cost risk and the extent of costs incurred before definitization. Document the risk assessment in the price negotiation memorandum.
Inquiries
Send questions about this deviation to osd.pentagon.ousd-a-s.mbx.dfars@mail.mil.