deemed to have occurred on the 7th day after Contractor estimates have been
received by the designated billing office.
(ii) The following periods of time will not be included in
the determination of an interest penalty:
(A) The period taken to notify the Contractor of
defects in invoices submitted to the Government, but this may not exceed 7
(B) The period between the defects notice and
resubmission of the corrected invoice by the Contractor.
(iii) Interest penalties will not continue to accrue after
the filing of a claim for such penalties under the clause at 52.233-1,
Disputes, or for more than 1 year. Interest penalties of less than $1.00
need not be paid.
(iv) Interest penalties are not required on payment delays
due to disagreement between the Government and Contractor over the payment
amount or other issues involving contract compliance, or on amounts
temporarily withheld or retained in accordance with the terms of the
contract. Claims involving disputes, and any interest that may be payable
will be resolved in accordance with the clause at 52.233-1, Disputes.
(6) An interest penalty shall also be paid automatically by the
designated payment office, without request from the Contractor, if a
discount for prompt payment is taken improperly. The interest penalty will
be calculated on the amount of discount taken for the period beginning with
the first day after the end of the discount period through the date when
the Contractor is paid.
(7) If this contract was awarded on or after October 1, 1989, a
penalty amount, calculated in accordance with regulations issued by the
Office of Management and Budget, shall be paid in addition to the interest
penalty amount if the Contractor --
Is owed an interest penalty;
( i i ) Is not paid the interest penalty within 10 days after
the date the invoice amount is paid; and
(iii) Makes a written demand, not later than 40 days after
the date the invoice amount is paid, that the agency pay such a penalty.
(b) Contract Financing Payments.
(1) For purposes of this clause, if applicable, "contract
financing payment," means a Government disbursement of monies to a
Contractor under a contract clause or other authorization prior to
acceptance of supplies or services by the Government, other than progress
payments based on estimates of amount and value of work performed.
Contract financing payments include advance payments.