Sign In
  • Question

    Can someone please explain the difference between and IDIQ and BOA and give an example? Thank you.


    Answer

    FAR 16.703 covers basic ordering agreements (BOAs).  BOAs are not considered contracts according to FAR 16.703(a)(3).  With a BOA, the terms and conditions and, in some cases, pricing formulas (in order to speed up the purchase when an order is placed against the BOA) are agreed to by the parties at the time a BOA is established.  A BOA is not required to be priced in advance and competition requirements in FAR Part 6 do not apply to BOAs.  However, at the time an order is placed against an unpriced BOA, the order must be competed in accordance with FAR Part 6 and prices established at time of award (See FAR 16.703(d)(1)(i)).  The individual orders awarded under the BOA are considered contracts.  According to FAR 16.703(b), BOAs are appropriate when "a substantial quantity of supplies or services are anticipated..." to be purchased under the BOA in the future, but there is not a present requirement for a minimum quantity.
     
    Indefinite Delivery Indefinite Quantity (IDIQ) contracts, on the other hand, are priced and awarded in accordance with FAR Part 6 (See FAR 6.001(e) & (f)).  Therefore, competition is not required each time an order is issued against an IDIQ unless multiple IDIQs were originally awarded in which case the competition rules at FAR 16.504(c) would apply to the individual orders placed under the multiple award IDIQs.  IDIQ contracts are appropriate when the government has an existing requirement to purchase at least a minimum quantity (See FAR 16.504(a)), and there are funds available to award at least the minimum at the time of contract award.
     
    See DFARS 217.204 regarding the ordering period for task and delivery order contracts.  With regard to the ordering period for BOAs, see DFARS 216.703, which states, "the period during which orders may be placed against a basic ordering agreement may not exceed 5 years." It's also important to be aware of the requirement at FAR 16.703(c)(2), which states "each basic ordering 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 ordering agreements may need to be revised before the annual review due to mandatory statutory requirements." 
     
    Therefore, the key differences between IDIQs and BOAS are as follows: IDIQs are contracts and BOAs are not.  FAR Part 6 applies to the award of IDIQs but not to BOAs.  The FAR requires that a minimum order be placed at time of IDIQ award while BOAs do not require a minimum.  IDIQs are usually priced upfront but BOAs are not required to be priced in advance. 
     
    A related AAP question and answer entitled "BOA vice IDIQ" can be found at https://www.dau.mil/aap/pages/qdetails.aspx?cgiSubjectAreaID=3&cgiQuestionID=118886

    Open full Question Details