During negotiations, how should permissible concessions be handled?

• A. Concessions should be permitted within the rules and properly documented.
• B. Concessions should be avoided and are not permitted.
• C. Concessions can be made informally without documentation.
• D. Concessions must be decided solely by the contractor.

Answer: (A)

Concessions in negotiations are permissible only when they stay within the established rules and are documented. This approach keeps the process transparent and accountable, and it creates a clear record of what was agreed for cost, schedule, and performance. Any concession that changes the contract should be formalized through a bilateral contract modification or amendment signed by both parties, so the government and the contractor share the same understanding of the new terms. Verbal or informal concessions aren’t binding and won’t protect against later disputes, and decisions shouldn’t be made unilaterally by the contractor alone.