Federal Acquisition Regulation (FAR) Explained

What Is the FAR?

The Federal Acquisition Regulation, universally known as the FAR, is the primary body of rules governing how the United States federal government purchases goods and services. Codified in Title 48 of the Code of Federal Regulations (CFR), the FAR establishes uniform policies and procedures for acquisitions by all executive branch agencies.

The FAR exists to achieve three objectives: deliver best value to the government through competition, minimize administrative operating costs, and ensure public trust in the integrity of the procurement process. Every solicitation you respond to, every contract you sign, and every modification you negotiate is governed by FAR provisions and clauses.

The regulation is jointly maintained by the Department of Defense (DoD), the General Services Administration (GSA), and the National Aeronautics and Space Administration (NASA) through the FAR Council. Changes to the FAR go through a public rulemaking process, and proposed rules are published in the Federal Register for public comment before being finalized.

You do not need to memorize all 53 parts of the FAR. But you do need to understand its structure, know where to find specific rules, and be thoroughly familiar with the parts that directly affect contractors.

FAR Structure (Parts 1-53)

The FAR is organized into 53 parts, grouped into eight subchapters. Understanding this structure helps you find what you need quickly when you need to reference a specific rule.

• Subchapter A (Parts 1-4): General: Foundational definitions, policies, administrative matters, and the Federal Procurement Data System.
• Subchapter B (Parts 5-12): Acquisition Planning: Publicizing requirements, competition requirements, types of contracts, and commercial item acquisitions.
• Subchapter C (Parts 13-18): Contracting Methods: Simplified acquisition procedures, sealed bidding, negotiated procurements, and emergency acquisitions.
• Subchapter D (Parts 19-26): Socioeconomic Programs: Small business programs, labor standards, environmental requirements, and foreign acquisition.
• Subchapter E (Parts 27-34): General Contracting Requirements: Patents, bonds, taxes, disputes, contract financing, and major system acquisitions.
• Subchapter F (Parts 35-41): Special Categories: R&D, construction, service contracting, utilities, and information technology.
• Subchapter G (Parts 42-51): Contract Management: Administration, quality assurance, subcontracting, termination, and use of government property.
• Subchapter H (Parts 52-53): Clauses and Forms: The full text of every FAR clause and standard forms used in contracting.

FAR references follow a standard numbering system. For example, FAR 15.305(a)(2) refers to Part 15, Subpart 305, paragraph (a), sub-paragraph (2). This numbering system is consistent throughout the regulation and its supplements.

Key Parts Contractors Must Know

While the entire FAR is relevant depending on the situation, certain parts come up on every contract and every proposal you will touch.

Part 12: Acquisition of Commercial Products and Services

Part 12 streamlines the procurement process for commercial items, products or services already available in the commercial marketplace. For contractors, this is significant because commercial item acquisitions use simplified procedures, fewer government-unique requirements, and commercial contract terms rather than full FAR clause sets. If your product or service qualifies as a commercial item under FAR 2.101, pursuing Part 12 acquisitions can significantly reduce your compliance burden. Many IT services, software licenses, and COTS (commercial off-the-shelf) products are procured under Part 12.

Part 13: Simplified Acquisition Procedures

Part 13 covers acquisitions below the Simplified Acquisition Threshold (SAT), currently $250,000. These procurements use streamlined procedures with less paperwork and faster award timelines. For new contractors building past performance, simplified acquisitions are an excellent entry point. Micro-purchases (under $10,000) require even less process; agencies can buy directly from a contractor without soliciting competitive quotes.

Part 15: Contracting by Negotiation

Part 15 is the backbone of competitive government procurement for complex acquisitions. It governs the source selection process, proposal evaluation criteria, competitive range determinations, discussions, and best value tradeoff analysis. Key sections every proposal writer must know:

• 15.304: Evaluation factors and significant subfactors that must be stated in the solicitation.
• 15.305: How proposals are evaluated, including past performance assessment.
• 15.306: Exchanges with offerors after receipt of proposals (clarifications, communications, discussions).
• 15.308: Source selection decision, where the Source Selection Authority makes the final award determination.

If you write proposals, you need to know Part 15 cold. The evaluation scheme described in the solicitation's Section M directly flows from Part 15 requirements.

Part 19: Small Business Programs

Part 19 implements the government's commitment to maximizing small business participation in federal procurement. It covers set-aside determinations, SBA size standards, the 8(a) Business Development Program, HUBZone, SDVOSB, and WOSB programs. If you are a small business, Part 19 defines your eligibility, the types of set-asides available, and sole-source thresholds. It also establishes subcontracting plan requirements for large prime contractors, which creates subcontracting opportunities for small firms.

Part 31: Contract Cost Principles

Part 31 defines which costs are allowable, allocable, and reasonable under government contracts. This is particularly important for cost-reimbursement contracts. Unallowable costs (such as entertainment, alcohol, fines, and certain lobbying expenses) cannot be charged to government contracts. Understanding these rules before pricing proposals or managing contract finances. Charging an unallowable cost can trigger audits, repayment demands, and potential suspension.

DFARS and Agency Supplements

The FAR provides the baseline rules, but individual agencies issue supplements that add requirements specific to their mission. The most significant is the Defense Federal Acquisition Regulation Supplement (DFARS), which applies to all Department of Defense procurements.

DFARS adds requirements in areas including cybersecurity (DFARS 252.204-7012 and CMMC compliance), cost accounting standards, foreign ownership restrictions, and technology transfer controls. If you work with DoD, which accounts for over 60% of federal contract spending, DFARS compliance is not optional. The cybersecurity requirements alone, particularly the Cybersecurity Maturity Model Certification (CMMC) program, can require months of preparation and tens of thousands in compliance costs for contractors handling Controlled Unclassified Information (CUI).

Other notable supplements include the GSAM (General Services Administration Manual), NASA FAR Supplement (NFS), and agency-specific supplements like the AIDAR (USAID Acquisition Regulation). When responding to a solicitation, always check which supplements apply; they are typically listed in Section I of the contract.

FAR Clauses in Contracts

Every government contract incorporates specific FAR clauses by reference or in full text. These clauses define your rights and obligations as a contractor. Part 52 contains the full text of all FAR clauses, while Part 53 covers standard forms.

Some clauses you will encounter in virtually every contract:

• 52.212-4: Contract Terms and Conditions (Commercial Products and Services)
• 52.222-3: Convict Labor prohibition
• 52.222-26: Equal Opportunity
• 52.222-36: Equal Opportunity for Workers with Disabilities
• 52.223-6: Drug-Free Workplace
• 52.232-33: Payment by Electronic Funds Transfer (EFT)
• 52.233-1: Disputes clause, governing the Contract Disputes Act process
• 52.244-6: Subcontracts for Commercial Products and Services

Read every clause incorporated in your contract. Ignorance of a clause does not excuse noncompliance. Pay particular attention to clauses related to intellectual property rights (52.227 series), limitation of liability, inspection and acceptance, and termination.

How FAR Affects Your Proposals

The FAR does not just govern contracts; it shapes how you write proposals. Every solicitation issued under FAR procedures includes specific instructions derived from FAR requirements.

Section L (Instructions to Offerors) tells you exactly what the government wants in your proposal, including format, page limits, font sizes, volume organization, and submission deadlines. These instructions are based on the contracting officer's authority under FAR Part 15. Non-compliance with Section L is grounds for your proposal to be rejected without evaluation.

Section M (Evaluation Criteria) defines how your proposal will be scored. FAR 15.304 requires that evaluation factors be stated in the solicitation and that price or cost must be evaluated in every source selection. The relative importance of technical, past performance, and price factors must also be disclosed. Use Section M as your blueprint; structure your proposal to address each evaluation factor and subfactor explicitly.

Representations and Certifications required by the FAR must be submitted with your proposal or maintained current in SAM.gov. Missing or outdated reps and certs can disqualify your proposal entirely.

Knowing the FAR gives you a real edge. When you know the rules the government must follow, you can anticipate how evaluations will unfold, spot when procedures are not being followed (grounds for a protest), and write proposals that hit every regulatory requirement.

Staying Current with FAR Changes

The FAR is a living document. Federal Acquisition Circulars (FACs) are published periodically in the Federal Register, introducing new rules, modifying existing clauses, and implementing executive orders and legislation. The official FAR is available online at acquisition.gov, and changes are reflected there as they become effective.

Key sources for staying current:

• Acquisition.gov: The official source for FAR text, including a change tracker.
• Federal Register: Proposed and final rules, with public comment periods.
• SAM.gov: Contract opportunities reference applicable FAR and DFARS clauses.
• Professional associations: Organizations like the National Contract Management Association (NCMA) provide analysis of FAR changes and their impact.

The FAR looks intimidating at 53 parts, but you do not need to learn it all at once. Start with the parts in this guide, read every clause in every contract you sign, and build your knowledge over time. Browse current contract opportunities on Drexault to see how FAR provisions appear in real solicitations.