62 STAT.] 80TH CONG. , 2D SESS.-CH. 65 -FEB. 19, 1948 procurement of types of supplies and services necessary to meet the requirements of the agency concerned. (b) All bids shall be publicly opened at the time and place stated in the advertisement. Award shall be made with reasonable prompt- ness by written notice to that responsible bidder whose bid, conform- ing to the invitation for bids, will be most advantageous to the Government, price and other factors considered: Provided, That all bids may be rejected when the agency head determines that it is in the public interest so to do. SEC. 4 . (a) Except as provided in subsection (b) of this section, contracts negotiated pursuant to section 2 (c) may be of any type which in the opinion of the agency head will promote the best interests of the Government. Every contract negotiated pursuant to section 2 (c) shall contain a suitable warranty, as determined by the agency head, by the contractor that no person or selling agency has been employed or retained to solicit or secure such contract upon an agree- ment or understanding for a commission, percentage brokerage or contingent fee, excepting bona fide employees or bona fide established commercial or selling agencies maintained by the contractor for the purpose of securing business, for the breach or violation of which warranty the Government shall have the right to annul such contract without liability or in its discretion to deduct from the contract price or consideration the full amount of such commission, percentage, brokerage, or contingent fee. (b) The cost-plus-a-percentage-of-cost system of contracting shall not be used, and in the case of a cost-plus-a -fixed-fee contract the fee shall not exceed 10 per centum of the estimated cost of the contract, exclusive of the fee, as determined by the agency head at the time of entering into such contract (except that a fee not in excess of 15 per centum of such estimated cost is authorized in any such contract for experimental, developmental, or research work and that a fee inclusive of the contractor's costs and not in excess of 6 per centum of the estimated cost, exclusive of fees, as determined by the agency head at the time of entering into the contract, of the project to which such fee is applicable is authorized in contracts for architectural or engineer- ing services relating to any public works or utility project). Neither a cost nor a cost-plus-a -fixed-fee contract nor an incentive-type con- tract shall be used unless the agency head determines that such method of contracting is likely to be less costly than other methods or that it is impractical to secure supplies or services of the kind or quality required without the use of a cost or cost-plus-a-fixed-fee contract or an incentive-type contract. All cost and cost-plus-a-fixed-fee con- tracts shall provide for advance notification by the contractor to the procuring agency of any subcontract thereunder on a cost-plus-a- fixed-fee basis and of any fixed-price subcontract or purchase order which exceeds in dollar amount either $25,000 or 5 per centum of the total estimated cost of the prime contract; and a procuring agency, through any authorized representative thereof, shall have the right to inspect the plants and to audit the books and records of any prime contractor or subcontractor engaged in the performance of a cost or cost-plus-a -fixed-fee contract. SEC. 5 . (a) The agency head may make advance payments under negotiated contracts heretofore or hereafter executed in any amount not exceeding the contract price upon such terms as the parties shall agree: Provided, That advance payments shall be made only upon adequate security and if the agency head determines that provision for such advance payments is in the public interest or in the interest of the national defense and is necessary and appropriate in order to procure required supplies or services under the contract 23 Opening of bids. Rejection. Types of contracts. Warranty. Cost-plus contracts. Advance notifica- tion of subcontract, etc. Advance payments. Restriction.
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