Fixed rate vs. fixed price in Contract Award Process Posted April 7, 2011 · Report reply Thank you, Retreadfed and Joel. According to your explanation and FAR 31 and FAR 52.215-2, I understand Cost Principle shall be applied to fixed-price contracts other than FFP and FPEPA. However, I wonder why prohibition of the use of fixed-price contract type other than FFP and FPEPA for commercial items is as strict as prohibition of CR for commercial item, while less uncertainties exists in fixed-price contracts and less financial risk is borne by the Government for fixed-price. I wish fixed-price with redetermination contracts could be allowed for commercial services when some conditions are met like T&M/LH use for commercial items. Maybe I think in this way because of my lack of knowledge on cost principles. I need to be educated.