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ARTICLE · 28 OCTOBER 2019

Special Compliance Requirements For Government Contractors

Steptoe LLP
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Doing business with the government is different. The federal government makes rules to protect the public interest and the public treasury,...

United StatesGovernment, Public Sector

Why Government Contracting Compliance Is Different, Part 1

Doing business with the government is different. The federal government makes rules to protect the public interest and the public treasury, waiving enough of its "sovereign immunity" so that contractors will elect to do business with it. Contractual "terms and conditions" are prescribed by statutes and regulations, (chiefly the 2,000+ page Federal Acquisition Regulation (FAR)),1 with little room for negotiation. Companies that seek government contracts must be prepared to accept them.

For example, the government is bound only by officials with actual authority. These "contracting officers" have written "warrants" that define their authority. Contractors cannot rely on instructions or commitments from any other government employee. Whereas commercial companies can be bound by commitments made by employees with "apparent" authority, the government is not.

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