Bilateral Modification (BilMod)

A written contract change that is signed by both the government and the contractor. It is used when both parties agree to change contract terms such as scope, price, schedule, or other conditions.

What Is a Bilateral Modification?

In government contracting, a Bilateral Modification is a formal agreement used to update an existing contract. Because both parties sign it, it reflects mutual consent to the change.

It is commonly used when the government and contractor negotiate and agree on adjustments to contract requirements or performance terms.

Key Characteristics

Signed by both the government and the contractor

Used to make agreed-upon contract changes

May affect scope, price, delivery dates, or terms

Documents mutual consent in writing

Becomes part of the official contract record

How It Works in Government Contracting

A Bilateral Modification usually appears during contract administration, after award, when a change to the contract becomes necessary. It is used when both sides must agree before the change takes effect.

Contracting officers, contractor representatives, program teams, and sometimes legal or pricing personnel may be involved. The parties review the proposed change, negotiate the terms, and then sign the modification.

In practice, Bilateral Modifications are often used for negotiated scope changes, equitable adjustments, funding updates that require agreement, period-of-performance revisions, or administrative corrections that need both signatures.

Regulatory Framework

Bilateral Modifications are part of the federal contract modification process and are generally associated with FAR-based contract administration procedures. They are distinct from unilateral modifications, which the government may issue without the contractor's signature in certain situations.

The modification must be within the authority of the contracting officer and consistent with the terms of the contract.

Why It Matters for Contractors

Bilateral Modifications matter because they formally document agreed changes and protect both parties by creating a clear record. They can affect contract value, performance obligations, deadlines, and risk allocation.

For contractors, reviewing the language carefully is important because signing the modification may also mean accepting related cost, schedule, or release terms.

Common Misconceptions About Bilateral Modifications

Every contract modification is bilateral.

Some modifications are unilateral and do not require the contractor's signature.

A Bilateral Modification is only used for major changes.

It can be used for both significant and routine agreed changes.

Verbal agreement is enough once both sides understand the change.

The change should be documented formally in writing and signed.

Frequently Asked Questions

What makes a modification bilateral?

It is bilateral when both the government and the contractor sign and agree to the change.

What kinds of changes can it cover?

It can cover changes to scope, price, schedule, terms, funding, or other contract conditions.

Is a Bilateral Modification the same as a change order?

No. A change order is typically unilateral at the time it is issued, while a Bilateral Modification reflects mutual agreement.

Why should contractors review it carefully before signing?

Because once signed, it may affect rights, obligations, payment, timelines, or claims related to the change.