The Federal Acquisition Regulation or FAR is a set of rules that regulates the federal government’s procurement process. The main purpose of these rules is to ensure that all the government’s procuring processes are uniform.
Moreover, it also checks that all the procedures are conducted impartially and fairly. The effects of FAR regulations can be seen in all federal contractors. Stay with us as we explain how FAR affects contractors.
How Federal Acquisition Regulation Affects Contractors?
Not many of you may know, but the expert agencies consider FAR the bible for government contracting. It gives the rules and regulations for procuring goods, services, and commercial items.
Federal officers refer to this document to check the proceedings of a contract. FAR follows the “Miller Act” requirements in its regulations. Under this act, a federal project contractor must submit a performance bond and a payment bond.
In case of any issues on a federal contractor’s job, the lower-tier parties like suppliers and subcontractors can recover the pending amount. They can do it by filing a Miller Act Claim payment bond. On the other hand, performance bonds function a bit differently. They serve to confirm whether the contractor has done his job correctly or not.
Fundamental Principles of Federal Acquisition Regulation
Here are the main principles of Federal Acquisition Regulation:
- Meeting requirements for quality, speed, and price
- Motivating fairness and integrity
- Reducing operating expenditures
- Other public policy objectives and goals
Even the easiest government contracts owners need not know the inside out of FAR to bid or win a federal contract. However, it would be wise if they understood the provisions given and payment bonds related to the Federal Acquisition Regulation. Knowing them in advance can save them from grave losses later on.
Relevance of Federal Acquisition Regulation for Contractors
It is a common notion that government contracting is a hard nut to crack. With so many rules and regulations, doing business is difficult for small businesses. But there is another side of the coin to it.
You see, the federal government also spends a lot in its outreach programs to find qualified, good small businesses to be its suppliers. Moreover, selling products to the commercial and federal government are quite similar.
Both want high-quality products at reasonable rates. Both seek a face-to-face meeting to understand the utility of the products and how they will add value to the consumers’ lives.
Although the approach is the same, the rules and regulations of doing business with the federal government differ. Every rule is meant to make the processes reliable and transparent for the customers and the government.
Bottom Line
You see, doing business with the government is an entirely different ball game. It is completely different from commercial contracts. Therefore, business owners should take some time out and learn the provisions of the Federal Acquisition Regulations.
All these rules and regulations are meant to introduce more accountability, transparency, and honesty in federal contracting procedures. Aspiring small businesses can refer to this updated guide to start a government contracting business.
