Transcript Document

2011-2012 Regulation
Highlights
Kimberly Heifetz
May 15, 2012
Changes in the FAR and DFARS
• Increased disclosure obligations
• A result of increased transparency and
accountability expected of federal Government
agencies by Congress and constituents
• Heightened expectations flow down to
Government contractors and their
subcontractors
BE PREPARED!
New DFARS Rules on Contractor Business
Systems
• Final rule published February 2012 – allows for review
by the cognizant contracting officer, in consultation
with cognizant audit agencies and other subject matter
experts
• There are new DFARS clauses (and associated
provisions) associated with each of six types of
contractor business systems:
◦
◦
◦
◦
◦
◦
Accounting
Estimating
Purchasing
Earned value management
Material management and accounting
Property management systems
New DFARS Rules on Contractor Business
Systems, continued
• The new rules do not apply to all DoD
procurements – only to CAS-covered contracts
• A “significant deficiency” finding can result in
corrective action plans, continued monitoring
and withholding of a percentage of contractor’s
payment
◦ Withholdings intended to compensate Government
for increased risk, not to impose a penalty
FAR Rule: Personal Conflicts of Interest
• Effective December 2, 2011, the FAR was amended to
prevent personal conflicts of interest by employees of
Government contractors who
◦ meet the definition of “covered employee” and
◦ perform “acquisition function(s) closely associated with
inherently governmental functions”
• Examples include financial interests of the employee
(and members of the employee’s family and/or
household), other employment or financial
relationships (including seeking or negotiating
prospective employment or business), gifts and travel.
• Excludes de minimus interests
Covered Employees
• Definition: An employee who performs
acquisition functions closely associated with
inherently governmental functions that are
directly tied to support the activities of federal
agencies
• The rule does not cover all employees who
work for a Government contractor
• Subcontractors bear responsibility for their
own employees
Applicability
• This new rule applies to contracts issued on or before
the rule’s December 2, 2011, effective date, as well as
to task and delivery orders issued on or after that date,
even if the contract under which they are executed was
awarded before December 2
• Mandatory flow-down of the substance of the clause is
required for subcontracts that exceed $150,000 and for
which subcontractor employees will perform
acquisition functions closely associated with inherently
governmental functions.
• Commercial item acquisitions are exempt from the new
rule.
Post-Employment Restrictions on Former
DoD Officials
• Government contractors that pursue work with
DoD agencies must affirmatively represent that
they have fully vetted certain former DoD
officials
• This will not impact offerors’ already existing
compliance obligations unless the contractor
has not been monitoring its employees to
ensure full and current compliance with the
post-employment restrictions
Expanded Public Disclosure of Contractor
Information
• Federal Awardee Performance and Integrity
Information System (“FAPIIS”)
◦ Created in 2010 by statutory mandate to serve as a
Government repository for specific information on the
integrity and performance of covered contractors and
grantees
• In 2006, the Federal Funding Accountability and
Transparency Act mandated that all federal award
data be made publicly accessible
• Section 3010 of the Supplemental Appropriations
Act of 2010 requires public access to contractor
information reported in FAPIIS, except past
performance information
Expanded Disclosure of Contractor
Information
• In January 2011, an interim rule became
effective providing for public availability of all
information posted on FAPIIS on or after April
15, 2011, except for past performance reviews
• Final rule effective January 2, 2012
• Primary difference between the two: The final
rule contains a 14-day contractor review period
prior to public posting
• Requested non-disclosure resolved under
applicable FOIA exemptions
Disclosure of Confidential, Proprietary,
Technical Data
• Interim rule issued in March 2011 – authorizes
DoD agencies to share with certain types of
Government support contractors sensitive
information provided in confidence by their
prime contractors and other third parties
• Non-disclosure agreements required to help
protect against unauthorized disclosure and
use by Government support contractors
• Effectively expands “limited rights” license
outside Government
Contact Information
Kimberly Heifetz
Thompson Coburn LLP
1909 K Street, N.W., Suite 600
Washington, DC 20006
(202) 585-6984
[email protected]
www.thompsoncoburn.com
12