25.700 Scope of subpart
Source: FAR 25.700 on acquisition.gov
FAR 25.700 establishes that federal contracts must comply with U.S. sanctions and statutory prohibitions against certain countries, entities, and individuals, requiring careful screening and due diligence by contractors and contracting officers.
Overview
FAR 25.700 outlines the scope of Subpart 25.7, which addresses prohibitions on contracting with certain sources due to U.S. economic sanctions and statutory restrictions. This section identifies the legal authorities and sanctions regimes implemented by the subpart, including those administered by the Office of Foreign Assets Control (OFAC), the Sudan Accountability and Divestment Act, the Iran Sanctions Act (and its amendments), and prohibitions related to entities exporting sensitive technologies to Iran. The purpose is to ensure that federal contracts do not support or engage with prohibited countries, entities, or individuals subject to U.S. sanctions or statutory restrictions.
Key Rules
- OFAC Economic Sanctions
- Prohibits transactions with certain countries, entities, and individuals as designated by OFAC.
- Sudan Accountability and Divestment Act
- Implements statutory restrictions on contracting related to Sudan.
- Iran Sanctions Act and Amendments
- Enforces prohibitions on contracting with entities connected to Iran, including those outlined in subsequent amendments.
- Prohibition on Sensitive Technology Exports to Iran
- Bars contracts with entities that export sensitive technologies to Iran.
Responsibilities
- Contracting Officers: Must ensure compliance with all applicable sanctions and statutory prohibitions when awarding contracts.
- Contractors: Must not engage in transactions or subcontracts with prohibited sources.
- Agencies: Responsible for oversight and ensuring adherence to these prohibitions in procurement processes.
Practical Implications
- This section exists to prevent federal funds from supporting sanctioned or restricted entities, aligning procurement with U.S. foreign policy and national security objectives.
- Contractors must conduct due diligence to avoid prohibited sources, and failure to comply can result in contract termination or legal penalties.
- Common pitfalls include inadequate screening of subcontractors or misunderstanding the scope of prohibited entities.
This subpart implements-
(a) Economic sanctions administered by the Office of Foreign Assets Control (OFAC) in the Department of the Treasury prohibiting transactions involving certain countries, entities, and individuals;
(b) The Sudan Accountability and Divestment Act of 2007 (Pub. L. 110-174) ( http://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title50-section1701&num=0&edition=prelim" target="_blank">50 U.S.C. 1701 note);
(c) The Iran Sanctions Act of 1996 (Iran Sanctions Act) (Pub. L. 104-172; http://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title50-section1701&num=0&edition=prelim" target="_blank">50 U.S.C. 1701 note), including amendments by the Iran Freedom Support Act (Pub. L. 109-293), section 102 of the Comprehensive Iran Sanctions, Accountability, and Divestment Act of 2010 (Pub. L. 111-195), and Titles II and III of the Iran Threat Reduction and Syria Human Rights Act of 2012 (Pub. L. 112-158); and
(d) Prohibition against contracting with entities that export sensitive technologies to Iran (http://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title22-section8515&num=0&edition=prelim" target="_blank">22 U.S.C. 8515).