4.1801 Definitions
Source: FAR 4.1801 on acquisition.gov
Accurately identifying and reporting immediate and highest-level owners is essential for compliance with CAGE Code and ownership disclosure requirements in government contracting.
Overview
FAR 4.1801 provides definitions for key ownership terms used in Subpart 4.18, which addresses requirements related to Commercial and Government Entity (CAGE) Codes. Specifically, it defines "immediate owner" and "highest-level owner" to clarify reporting and disclosure obligations for contractors. Understanding these definitions is essential for accurately identifying and reporting ownership structures in government contract documentation, particularly when completing representations and certifications or responding to requests for ownership information.
Key Rules
- Immediate Owner
- Defined as an entity (other than the offeror) with direct control over the offeror, with control indicated by factors such as ownership, management, shared resources, or familial interests.
- Highest-Level Owner
- Defined as the top entity in the ownership chain that owns or controls the immediate owner or entities controlling the immediate owner, with no other entity exercising control over it.
Responsibilities
- Contracting Officers: Must ensure contractors provide accurate ownership information as required by Subpart 4.18.
- Contractors: Must correctly identify and report their immediate and highest-level owners when required.
- Agencies: May use this information for due diligence, responsibility determinations, and compliance with reporting requirements.
Practical Implications
- These definitions help standardize ownership reporting, reducing ambiguity and ensuring transparency in government contracting.
- Accurate identification of ownership is critical for compliance with CAGE Code requirements and related representations.
- Misidentification or failure to report ownership can lead to compliance issues or delays in contract award.
As used in this part–
Highest-level owner means the entity that owns or controls an immediate owner of the offeror, or that owns or controls one or more entities that control an immediate owner of the offeror. No entity owns or exercises control of the highest level owner.
Immediate owner means an entity, other than the offeror, that has direct control of the offeror. Indicators of control include, but are not limited to, one or more of the following: ownership or interlocking management, identity of interests among family members, shared facilities and equipment, and the common use of employees.