Without understanding the reasons for the rule, a contractor will almost always fail to target the right issues to discuss when responding to the agency’s proposed debarment letter.
- Once the poor response is submitted, the company’s future is a great risk.
- Remember that under debarment and suspension regulations, it is up to you to show why the company is a responsible subcontractor.
- Taking a hostile approach to debarment actions will often end up with a bad result.
Under federal government procurement regulations, debarred means that the government can elect to prohibit any recipient of government contracts, grants, and covered Non-procurement transactions. The legal definition does not include actions taken by the contracting officer that is simply a means of punishment.
FAR 9.4 Debarred Applicability
FAR 9.401 states that IAW Public Law 103-355, Section 2455 (31 U.S.C. 6101, note), and defines Executive Order 12689, any debarment or suspension action, or any other Governmentwide exclusion commenced under the Nonprocurement Common Rule to Executive Order 12549 on August 25, 1995, or after, shall be looked at as a debarment or suspension under this subpart. Signs of Being Under Investigation (Federal)
Suspension and Debarment Policy: When it comes to the debarred meaning and the suspension of government contractors, the Federal Government contracting agencies by law cannot award contracts to prime contractors or subcontractors (by consent) to companies that are not ”responsible.” Therefore, government agencies place companies on the debarment party list to put other agencies on notice of any suspension or debarment actions.
The analysis is debarment meaning shows that there are certain reasons why public policy drives why the legal definition is in place. The most important reason is that the source of funds to fund federal contracts is taxpayer dollars. With that said, to debar a contractor should not mean that the government is trying to simply punish the contractor. See FAR 9.4
Agency coordination encouraged. Suspension and debarment policies highly encourage agencies to establish procedures and methods to coordinate either suspension or debarment actions. Placing contractors on SAMS debarment list due to business ethics, procurement fraud or other reasons has a serious impact on the company’s future but it also impacts other government contracting agencies nationwide. See Basic Tips on How to Respond to Federal Government Investigations.
For example, if a contractor has other contracts with various other agencies, then those agencies may not be able to extend option years if the contractor is debarred. See Difference Between Suspension and Debarment From Government Contracts.
Options available to the agency. Also if the proposed contractor was fortunate enough to have been recently awarded a new contract, then the awarding agency may now have to re-procure the contract. This puts a strain on the awarding agency’s mission.
- Sometimes, placing a contractor on a suspension list instead of the debarred party list could be a solution.
- Sometimes crafting the right Administrative Agreement can be effective for both the government and the contractors.
More than one agency could be involved. Sometimes more than one agency has an interest in adverse contractor actions. When this happens the Interagency Committee on Debarment and Suspension ( Executive Order 12549, authorized by Section 873 of the National Defense Authorization Act for Fiscal Year 2009 has the task of resolving the primary debarring agency issues and disputes and then coordinate any resolution between the other interested contracting agencies. Find out Does Force Majeure Clauses Apply to Federal Government Contracts COVID 19
- When other agencies contract with contractors recommended for debarment or suspension, their mission is also at risk.
- Companies subject to debarment and suspension of government contractors should also approach its response to the notice accordingly.
For help analyzing how the debarred meaning under FAR 9.4 and application suspension and debarment regulations impact how you handle the federal government suspension and debarment, call our government contract attorneys at 1-866-601-5518. Free Initial Consultation.