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 broad set of statutory and executive order-based clauses in commercial contracts and specifies which must be flowed down to subcontractors, making careful clause review and supply chain compliance essential.
Overview
FAR 52.212-5 is a mandatory clause for contracts involving commercial products and commercial services. It requires contractors to comply with a comprehensive list of FAR clauses that implement various statutes and Executive Orders. The clause is structured to incorporate certain clauses automatically, while others are included at the discretion of the Contracting Officer, depending on the contract’s specifics. It also details which clauses must be flowed down to subcontractors and under what circumstances, ensuring statutory and regulatory compliance throughout the supply chain.
Key Rules
- Mandatory Clauses (Paragraph a):
- Contractors must comply with a core set of FAR clauses automatically incorporated by reference, covering topics such as confidentiality, supply chain security, payment to small business subcontractors, and equal opportunity.
- Optional Clauses (Paragraph b & c):
- Additional clauses may be incorporated by the Contracting Officer, including those related to small business programs, labor standards, environmental requirements, and more. Contractors must comply with any checked clauses in their contract.
- Comptroller General Access (Paragraph d):
- For contracts awarded by negotiation and exceeding the simplified acquisition threshold, the Comptroller General may examine contractor records for three years after final payment.
- Subcontract Flowdown (Paragraph e):
- Only specific clauses listed in paragraph (e)(1) must be flowed down to subcontracts for commercial products/services, unless otherwise required by the clause itself.
- Alternates:
- Alternate versions modify record access and flowdown requirements for certain contract types.
Responsibilities
- Contracting Officers: Must select and indicate applicable clauses, ensure proper inclusion in contracts, and verify flowdown requirements are met.
- Contractors: Must comply with all incorporated clauses, flow down required clauses to subcontractors, maintain records as required, and ensure all documentation and reporting obligations are met.
- Agencies: Oversee compliance, may audit records, and enforce statutory and regulatory requirements.
Practical Implications
- This clause ensures statutory and executive order compliance in commercial acquisitions, streamlining which requirements apply and clarifying flowdown obligations. Contractors must carefully review which clauses are incorporated and ensure their supply chain is also compliant. Failure to comply can result in contract disputes, penalties, or loss of eligibility for future awards.