Bilateral (Supplemental Agreement) Modification
Also known as: Supplemental agreement, bilateral mod, negotiated modification
What you do here: Negotiate the change, agree on price and time, and both sign the SF 30 before you perform
At a Glance
- Who signs it
- Both parties — the contractor and the contracting officer
- What it does
- Records a negotiated change and its agreed price, time, and terms
- Governing authority
- FAR 43.103(a) (supplemental agreements); recorded on SF 30
- Effect on price/time
- Agreed up front — the number is settled when you sign, not litigated later
- When it's used
- Definitizing equitable adjustments, adding funds/scope you've agreed to, exercising priced options by agreement
What It Is
A bilateral modification — the FAR term is a "supplemental agreement" (FAR 43.103(a)) — is a change to the contract that both the contractor and the contracting officer sign. Because it takes two signatures, it reflects a meeting of the minds: the parties have negotiated what the change is and what it does to price, delivery, and terms, and they memorialize the deal, almost always on Standard Form 30 (Amendment of Solicitation/Modification of Contract). Bilateral modifications are the vehicle for definitizing an equitable adjustment after a change order, adding agreed scope or funding, incorporating a negotiated settlement, and reflecting any change the government cannot make on its own authority. The critical practical point is that the price and schedule impact is settled when you sign — you are not leaving it to be fought over later. That is exactly why a bilateral mod is the safest way for a small contractor to change a contract: you don't perform first and hope the money follows.
When You See It
- To definitize (finalize) the equitable adjustment after the government issued a unilateral change order.
- To add agreed scope, quantity, or funding that the parties have negotiated.
- To incorporate a negotiated settlement — for example, of a Request for Equitable Adjustment or a termination.
- To make any change that requires the contractor's consent, such as new terms outside the government's unilateral authority.
Key Features
| Feature | What It Means |
|---|---|
| Two signatures | A supplemental agreement is signed by both the contractor and the contracting officer — neither side can impose it alone. |
| Price and time agreed up front | The adjustment to price, delivery, and terms is negotiated and fixed at signing, so there's nothing left to litigate for that change. |
| Recorded on SF 30 | Modifications are documented on Standard Form 30, which identifies the contract, the modification number, the authority, and the change. |
| Consideration required | As a contract change, a bilateral mod needs consideration — usually the price/time adjustment itself — to be enforceable. |
| The safest change vehicle | Because both parties agree, a signed bilateral mod avoids the risk of performing a change and then disputing the compensation. |
The SDVOSB Angle
For a small SDVOSB prime, the bilateral modification is your friend — insist on it. A signed supplemental agreement locks the price of the change before you spend the labor and materials, which protects the thin cash cushion most veteran-owned small firms run on. Watch two SDVOSB-specific angles: first, when a modification adds scope or extends performance, re-run the limitations on subcontracting over the modified work, because the self-performance math is measured over the contract as changed. Second, get the adjustment definitized promptly — don't let the government leave a change order un-priced for months while you carry the cost.
How to Handle It
- Do not perform an added-scope change until it's captured in a signed bilateral modification (or a written change order you'll price).
- Price the change fully — direct labor, materials, subcontracts, indirect costs, profit, and any schedule impact.
- Confirm the modification cites the correct authority and updates funding, period of performance, and CLINs as needed.
- Re-check the limitations on subcontracting if the mod changes scope, and update your subcontract paper to match.
- Have the SF 30 signed by both parties before you rely on it, and keep it with your contract file.
Watch Out For
- Starting work on a "handshake" change before the bilateral mod is signed can leave you performing for free.
- Signing a modification with a broad release can waive claims for impacts you haven't fully quantified yet.
- Forgetting to adjust the period of performance or funding can leave you unable to invoice for the added work.
- A modification that adds work beyond the contract's scope may be a cardinal change that should have been competed — signing it doesn't always cure that.
Run the Numbers
Frequently Asked
What is a bilateral contract modification?
A bilateral modification, called a supplemental agreement in FAR 43.103(a), is a change to a federal contract signed by both the contractor and the contracting officer. Because it takes both signatures, it reflects a negotiated agreement on the change and its effect on price, delivery, and terms — typically recorded on Standard Form 30. It is the vehicle for definitizing equitable adjustments and for any change that requires the contractor's consent.
What is the difference between a bilateral and a unilateral modification?
A bilateral modification is signed by both parties and reflects a negotiated agreement, so the price and schedule impact is settled at signing. A unilateral modification is signed only by the contracting officer and is used for changes the government is authorized to make on its own — administrative changes, change orders under the Changes clause, exercising an option, or adding funds. After a unilateral change order, the parties usually negotiate a bilateral modification to definitize (finalize) the equitable adjustment.
Do I have to sign a contract modification?
You must sign a bilateral modification for it to take effect — the government cannot impose a supplemental agreement without your signature. You do not sign a unilateral modification; the contracting officer signs it under the government's authority (for example, a change order under the Changes clause), and your remedy is to seek an equitable adjustment. If you disagree with a directed change, perform it under protest in writing and pursue an equitable adjustment or a claim.
Primary Sources
- FAR 43.103 — Types of contract modifications
- FAR 43.301 — Use of Standard Form 30
- FAR 52.243-1 — Changes—Fixed-Price
Plain-English reference, not legal advice. Contract modification, options, novation, and termination rules are fact-specific, and the FAR and agency supplements are amended from time to time — always read the current FAR text, follow the notice and certification timeframes in your specific contract clauses, confirm the requirements with the contracting officer, and consult qualified counsel before relying on a modification, settlement, claim, or termination position.
Change log (1)
- LaunchedPublished the federal contract modifications, options & change management reference covering how a federal contract changes after award — the bilateral supplemental agreement and the unilateral modification (FAR 43.103), the change order under the Changes clause (FAR 52.243-1), the administrative change (FAR 43.101), the equitable adjustment and the Request for Equitable Adjustment (FAR 43.204 / 43.205), the constructive change doctrine, the options to extend the term and quantity (FAR 52.217-8, 52.217-9, and the Subpart 17.2 quantity options 52.217-6/-7), the novation and change-of-name agreements (FAR Subpart 42.12), and the terminations for convenience and default (FAR Part 49 / 52.249-2 / 52.249-8) — each with an at-a-glance quick-facts card, a when-you-see-it list, a key-features table, an SDVOSB-specific angle, a how-to-handle-it checklist, watch-outs, FAQPage, Article, Dataset, and BreadcrumbList structured data, primary-source FAR citations, and cross-links into the glossary, regulation explainers, clauses, forms, contract types, protest & dispute forums, compliance deadlines, how-to guides, FAQ, and the limitations-on-subcontracting, price-to-win, size-standard, and set-aside eligibility calculators.