Just because your company does not contract directly with the government does not necessarily mean you are not subject to the many requirements associated with government contractors. Those who provide goods and services to OEMs, or other customers who sell to the government, may also be subject to those requirements.
Many government contractors incorporate by reference Federal Acquisition Regulation (“FAR”) clauses, FAR agency supplemental clauses, or other federal government contracting laws and regulations into agreements with subcontractors and materials supplier. Then, those companies are obligated to comply with those government-unique requirements. These FAR and FAR agency supplemental clauses are often found in a customer’s terms and conditions incorporated by reference in the subcontract or purchase order and available on the customer’s website. Thus, many companies do not even realize they are government subcontractors.
So how do you know? Below are some tips to identify if your company has federal government subcontracts:
The federal government imposes a set of complex requirements upon all federal government prime contractors and subcontractors. And it is important to stay abreast of these government requirements as they develop. Currently, for example, regulations require compliance with various equal employment opportunity and affirmative action requirements; rules to protect intellectual property; obligations under the Truth in Negotiation Act to disclose certified cost or pricing data; adherence to Cost Accounting Standards; laws regulating the extent to which contractors may acquire materials, products, and services abroad; compliance with U.S. export controls laws and regulations; and detailed procedures governing contract changes, terminations, and warranties. It is essential to identify whether your company is a federal government contractor to determine the extent of its obligations and ensure compliance with these requirements.
Want to Learn More?
If your company is a federal government prime contractor or subcontractor, please join us for a complimentary webinar on Best Practices in Drafting U.S. Government Subcontract Terms and Conditions, which will be held on Wednesday, June 10, 2015 beginning at noon eastern. This presentation will identify best practices for drafting federal government subcontract terms and conditions to reduce risk and potential liability exposure from the perspectives of the higher-tiered contractor and the subcontractor. To register for the webinar, please click here.