Major FAR Overhaul Signals Procurement Shift
A significant overhaul of the Federal Acquisition Regulation (FAR) is reportedly imminent, with multiple analysts describing the changes as "revolutionary." The reforms are expected to modernize the rules governing roughly $700 billion in annual federal contracting. The changes aim to make it easier for technology companies and non-traditional vendors to do business with the government, signaling a new era in federal acquisition.
- This overhaul, initiated by Executive Order 14275, "Restoring Common Sense to Federal Procurement," is the most comprehensive update to the FAR in over 40 years and is being led by the Office of Federal Procurement Policy (OFPP). The stated goals are to simplify regulations, increase competition, reduce bureaucracy, and make the federal marketplace more accessible to new and non-traditional vendors. - A key structural change is the removal of non-statutory regulations from the FAR itself; this content will be moved into non-binding "buying guides" that provide best practices. This is part of a "plain language" rewrite intended to make the core regulations easier to understand and follow. - The overhaul introduces a mandatory four-year sunset clause for all FAR provisions not required by statute, meaning they will expire unless actively renewed by the FAR Council. This is intended to ensure regulations remain current and relevant. - The initiative is being implemented on a two-track approach: federal agencies are directed to immediately adopt draft text through "model class deviations" even as the formal rulemaking process, which includes public comment, proceeds in parallel. - For technology acquisitions, FAR Part 39 has been broadened from "Information Technology" to "Information and Communication Technology (ICT)" to include emerging tech, and it encourages modular contracting and managing, rather than avoiding, risk. This aligns with the DoD's push to accelerate AI adoption through initiatives like the Chief Digital and Artificial Intelligence Office (CDAO) and the Tradewinds Solutions Marketplace. - A proposed rule to amend the FAR regarding SBIR/STTR data rights, originally published in April 2023, has been withdrawn. The FAR Council will re-evaluate its implementation after the broader overhaul is finalized, with any future changes to be handled under a new FAR case. - The reform complements the General Services Administration's (GSA) "OneGov" strategy, which aims to consolidate the government's buying power for common goods and services, particularly IT. The goal is for the government to act as a single enterprise, leveraging its scale for better pricing and terms directly with original equipment manufacturers (OEMs). - Recent updates have already been released for several FAR parts, including Part 10 (Market Research), Part 12 (Commercial Products and Services), Part 18 (Emergency Acquisitions), and Part 34 (Major System Acquisition), signaling a rapid pace of change. Inflation adjustments effective October 1, 2025, have also increased the micro-purchase and simplified acquisition thresholds.
