Other Transaction Authority (OTA)
Other Transaction Authority (OTA) lets certain agencies enter agreements for research, prototypes, and follow-on production that are not standard procurement contracts — largely exempt from the FAR — to attract nontraditional contractors and move faster than conventional acquisition allows.
Other Transactions are statutory instruments (for DoD, principally 10 U.S.C. 4021–4022) sitting outside the FAR framework: no standard clauses, negotiable intellectual property terms, and flexible cost-sharing. Prototype OTs can transition to follow-on production without a new competition when the original solicitation provided for it — the feature that made OTs central to defense innovation strategy.
The flexibility is real but not unlimited: eligibility conditions (nontraditional participation or cost share), fair-opportunity expectations for consortium-managed awards, and audit interest all apply. OTs complement, rather than replace, FAR contracting for well-understood requirements.
Regulatory Reference
10 U.S.C. 4021-4022; agency OT guides
RFO Status
OTs sit outside the FAR and are unaffected by the overhaul's text changes, though the reform climate has increased interest in both.
Category
Contract Types & Vehicles
How AcqBot Helps
AcqBot supports end-to-end innovation pathways — including SBIR and prototype-to-production workflows — with the solicitation language that preserves follow-on production authority from day one.
Related glossary entries
Indefinite Delivery/Indefinite Quantity (IDIQ)
An Indefinite Delivery/Indefinite Quantity (IDIQ) contract buys an unspecified quantity of supplies or services, within stated minimum and maximum limits, over a fixed period. The government buys through task or delivery orders under FAR 16.504, with a preference for multiple awards.
Firm-Fixed-Price (FFP)
A firm-fixed-price (FFP) contract sets a price that is not subject to adjustment based on the contractor's cost experience in performance. FAR 16.202 places maximum cost risk on the contractor, who absorbs every overrun and keeps every underrun.
Cost-Plus-Fixed-Fee (CPFF)
A cost-plus-fixed-fee (CPFF) contract reimburses allowable costs and pays a fee negotiated and fixed at inception. The fee does not vary with actual cost, though it may adjust when the work changes. FAR 16.306 governs; statutory caps limit the fee.
Time-and-Materials (T&M)
A time-and-materials (T&M) contract pays fixed hourly labor rates — wages, overhead, G&A, and profit built in — plus materials at actual cost. FAR 16.601 permits it only when the extent or duration of the work cannot be estimated accurately at award.