52.212-5
Contract Terms and Conditions Required To Implement Statutes or Executive Orders—Commercial Products and Commercial Services
FAR 52.212-5 mandates compliance with a comprehensive set of statutory and executive order-based FAR clauses in commercial contracts, including specific flow-down and record-keeping requirements that contractors must carefully manage.
Overview
FAR 52.212-5 is a mandatory clause for contracts involving commercial products and commercial services. It requires contractors to comply with a wide range of Federal Acquisition Regulation (FAR) clauses that implement statutory and executive order requirements. The clause is structured to ensure that contractors and their subcontractors adhere to laws and policies on ethics, labor, equal opportunity, supply chain security, environmental protection, and more. The specific clauses that apply depend on the contract and are either automatically included or selected by the Contracting Officer. The clause also addresses flow-down requirements, record examination rights, and alternate versions for special circumstances.
Key Rules
- Mandatory Incorporation of FAR Clauses
- Contractors must comply with a core set of FAR clauses (listed in paragraph (a)), and additional clauses as indicated by the Contracting Officer (paragraphs (b) and (c)), covering topics such as ethics, labor standards, equal opportunity, supply chain security, and payment terms.
- Flow-Down Requirements
- Only certain FAR clauses must be flowed down to subcontracts for commercial products or services, as specified in paragraph (e). Contractors are not required to flow down other clauses unless specifically required.
- Record Examination and Retention
- For contracts awarded using other than sealed bidding and above the simplified acquisition threshold, the Comptroller General (and in some alternates, Inspectors General) may examine contractor records for up to three years after final payment.
- Alternate Clauses
- Alternate I and II modify record examination and flow-down requirements for specific contract types or agency needs.
Responsibilities
- Contracting Officers: Must identify and check applicable clauses in paragraphs (b) and (c), ensure correct clause version/alternate is used, and communicate flow-down requirements.
- Contractors: Must comply with all incorporated FAR clauses, ensure required clauses are flowed down to subcontractors, maintain records as required, and allow government access for audits.
- Agencies: Oversee compliance, enforce clause inclusion, and may audit contractor records as authorized.
Practical Implications
- This clause ensures statutory and executive order compliance in commercial acquisitions, reducing risk for agencies and contractors.
- Contractors must carefully review which clauses apply to their contract and ensure proper flow-down to subs. Failure to comply can result in contract termination, penalties, or loss of future awards.
- Common pitfalls include missing required flow-downs, misunderstanding which clauses are mandatory, and inadequate record retention.