Agencies, vendors will likely favor simpler buying integrity rules

In early 1996, Congress completely revamped the rules regarding procurement integrity.

 To meet the requirements of the Clinger-Cohen Act, the Federal Acquisition
Regulation rewrite team fleshed out new rules that took effect Jan. 1.

 In an overreaction to the Ill Wind scandal at the Defense Department and other
buying shenanigans, Congress had passed the Procurement Integrity Act. That law set up
such stringent and broad rules that it chilled communications between contractors and

 Fear of running afoul of these restrictions kept many contracting officials from
even innocuous contacts with industry regarding future government requirements, methods
used to procure those requirements and potential specifications.

 But the new rules establish a more measured set of prohibitions.

 So that everyone knows the new rules permit what was previously prohibited, they are
explicit about certain contacts. Now authorized are "individual meetings between a
federal agency official and an offeror or potential offeror for, or a recipient of, a
contract or subcontract under a federal agency procurement, provided that unauthorized
disclosure or receipt of contractor bid or proposal information or source selection
information does not occur."

 A major change is the complete abolition of procurement integrity certifications.
Previously, vendors had to provide certifications both at contract award and before
concluding modifications. The law still contains important restrictions relating to the
integrity of the procurement process, but contractors need no longer certify that they are

Also gone with the certification is the system by which all participants report
"any information concerning a violation or possible violation" to a company
official, who then certifies to the government whether there are any "violations or
possible violations."

 Another noteworthy change is that offerors can designate proposal contents as the
type of information that the government is prohibited from releasing to competitors. To do
so, a vendor must mark the information with the legend set forth in a standard
solicitation provision.

 The new rules define-in a different way-how discussions about potential employment
are to proceed between federal employees and actual or prospective contractors. Contacts
are regulated, whether they are directly between principals or through an intermediary.

 The new rules also expand the scope of these restrictions to prevent compensation
from a contractor for a one-year period. As before, a federal official can request
guidance from a designated "ethics official."

 Another area in which the new rules may go further than the old involves the
gathering and use of marketing intelligence. The superseded regulations prohibited the
disclosure of sensitive information only by procurement officials. But the new ones apply
to "a person." It is prohibited for a person, except as provided by law, to
"knowingly obtain contractor bid or proposal information or source selection
information before the award of a federal agency procurement contract to which the
information relates."

 This clause can be interpreted as barring one competitor from getting unauthorized
information about another's bid or proposal from any source, not just the government.

 To keep a protest from blindsiding an agency on these issues, the regulations
restrict the right of a wronged offeror to complain. No vendor can file a protest at the
General Accounting Office unless the protester has reported to the contracting officer
"the information constituting evidence of the violation within 14 days of its
discovery." No such restriction applies, however, to federal court suits.

 In an era of decentralized procurement, uniform and predictable rules still have a
place. Procurement integrity is one area that should be consistent. Why should improper
conduct at one agency be permissible at another? The new FAR rules will be easier for
federal officials and contractors to understand and follow. 

Joseph J. Petrillo is a lawyer with Petrillo & Associates in Washington. William
E. Conner, an associate with the law firm, contributed to this column.

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