FAR (Federal Acquisition Regulation)

What is FAR (Federal Acquisition Regulation)?

The Federal Acquisition Regulation (FAR) serves as the comprehensive rulebook for all federal government procurement. It establishes uniform policies and procedures for the acquisition of supplies and services by federal agencies. Compliance with the FAR is mandatory for both government agencies and contractors.

Definition

The FAR, codified as Title 48 of the Code of Federal Regulations (CFR), provides detailed guidance on virtually every aspect of federal contracting. This includes, but is not limited to, source selection, contract types, pricing, contract administration, and dispute resolution. Its primary purpose is to ensure that government acquisitions are conducted in a fair, open, and transparent manner, while also obtaining the best value for the taxpayer. The FAR applies to all executive agencies of the U.S. federal government.

Understanding the FAR is essential for any business seeking to engage in government contracting. Contractors must be familiar with the specific FAR clauses that apply to their contracts and must ensure they have systems and procedures in place to comply with these requirements. Non-compliance can lead to significant penalties, including contract termination, fines, and debarment from future government contracts.

Key Points

• Comprehensive Scope: The FAR covers the entire acquisition lifecycle, from pre-solicitation planning to contract closeout.
• Mandatory Compliance: All federal agencies and contractors working with them must adhere to the FAR's provisions.
• Detailed Guidance: The FAR provides detailed instructions on acquisition procedures, contract types, and specific clauses that must be included in government contracts.
• Dynamic Regulation: The FAR is continuously updated to reflect changes in law, policy, and best practices. Contractors must stay informed of these changes to ensure compliance.

Practical Examples

1. Proposal Preparation: When responding to a Request for Proposal (RFP), the FAR dictates specific requirements for proposal format, content, and submission procedures. Failure to adhere to these requirements can result in proposal rejection.
2. Cost Accounting: For cost-reimbursement contracts, the FAR outlines stringent requirements for cost accounting practices. Contractors must maintain accurate records and be able to demonstrate that their costs are allowable, allocable, and reasonable.
3. Subcontracting: If a prime contractor intends to subcontract a portion of the work, the FAR imposes certain obligations, such as obtaining consent from the government and ensuring that the subcontractor complies with applicable FAR clauses.