Far Novation Agreements


When a business needs to acquire goods or services, it usually enters into a contract with a supplier or vendor. However, sometimes businesses may need to modify an existing contract to accommodate changes in the market or unexpected circumstances. When this happens, a far novation agreement may be used.

What is a Far Novation Agreement?

A far novation agreement is a legal document that transfers the rights, obligations, and liabilities of one party to another. It is commonly used in government contracts where a company is acquired by another company or changes ownership in some way. The novation agreement transfers the contract from the original owner to the new owner, and they become responsible for fulfilling the terms of the agreement.

When is a Far Novation Agreement Necessary?

A far novation agreement is necessary when there is a transfer of ownership or assets between companies, and it affects the performance of a government contract. For example, there may be a change in the company`s name, location, or management structure. In such instances, the government requires a novation agreement to ensure that the contract remains valid and enforceable.

The Steps Involved in a Far Novation Agreement

The process of a far novation agreement involves several steps, including:

1. Notification: The contractor should provide written notice to the government as soon as possible, informing them of any changes.

2. Agreement: The contractor, the government, and the new company must come to an agreement on the terms of the novation agreement.

3. Execution: Once the agreement is reached, all parties involved must sign the novation agreement.

4. Approval: The government must approve the novation agreement before it becomes effective.

5. Implementation: After the novation agreement is approved, the new company assumes responsibility for fulfilling the government contract.


In summary, a far novation agreement is a legal document used to transfer the rights, obligations, and liabilities of a government contract from one company to another. It is a necessary process when there is a change in ownership or assets that affects the performance of the contract. The novation agreement ensures that the contract remains valid and enforceable, even after changes have occurred. If you are a government contractor and need more information about novation agreements, it is advisable to seek legal advice.