On April 15, 2025, President Trump issued Executive Order 14275 and directed wide-sweeping revisions to the Federal Acquisition Regulation (FAR) to make the federal procurement process more efficient. As discussed in our earlier client alert, “Revolutionary Changes Ahead: Understanding the Overhaul of Federal Procurement Regulations,” this Executive Order marked the beginning of a comprehensive effort to streamline and deregulate the FAR. In line with this directive, on May 2, 2025, the Office of Federal Procurement Policy (OFFP) published the first wave of proposed revisions, focusing on FAR Part 1 (Federal Acquisition Regulations System), Part 34 (Major System Acquisition), and Part 52 (Solicitation Provisions and Contract Clauses).
OFFP’s issuance of FAR rewrites coincides with the Office of Management and Budget (OMB)’s memorandum to the heads of executive departments and agencies announcing OFFP’s lead in a revolutionary overhaul of the FAR. On the same day, the FAR Council also issued Deviation Guidance regarding the FAR’s overhaul. The FAR Council advised agencies to issue agency-specific deviations implementing the FAR Council’s deregulated coverage within 30 days after the release of the model deviation text. The memorandum explains that while the FAR Council intends to begin formal rulemaking regarding the new proposed language, the OMB encourages agencies to make the deviated FAR language effective immediately until the new FAR language becomes final.
While the FAR Council is currently accepting informal public comments, the FAR Council will not formally respond to comments received but will consider feedback on its model deviation text during the formal rulemaking phase. Given that agencies will have to follow the updated FAR language once released by the FAR Council, contractors should be up-to-speed on the FAR’s revised language. The FAR Council will publish model deviation text on a rolling basis at the “Revolutionary FAR Overhaul” (RFO) website. Below is a summary of the FAR Council’s initial revisions.
FAR Part 1
The proposed revisions to FAR Part 1 center on removing language meant to guide readers on the proper use of the FAR. For example, a large portion of the FAR’s language regarding the federal government’s purpose and goals during the acquisition process has been removed in an effort to simplify the regulations. Additionally, the proposed revisions remove any language regarding the public’s participation in the formulation of the FAR provisions. Finally, the revisions include new language related to the federal government’s oversight of the government procurement system, including the termination and management of contracting officers and contracting officers’ representatives.
Notably, FAR Part 1’s new “regulatory sunset” language would mandate the expiration of any FAR section that is not required by statute four (4) years after its effective date, unless renewed by the FAR Council.
FAR Parts 34 and 52
The proposed revisions to Part 34 of the FAR (Major System Acquisition), relate to Testing, Qualification and Use of Industrial Resources Developed Under Title III, Defense Production Act (Subpart 34.1) and Earned Value Management System (Subpart 34.2). While several of the proposed revisions to these subparts are procedural, for example, updating cross references to various FAR provisions, there are a few substantive changes that will impact contractors.
With respect to Subpart 34.1, while originally it was the government’s policy to pay for any testing and qualification required for the use or incorporation of industrial resources manufactured or developed under Title III of the Defense Production Act, the revised regulations indicate that while the government “will generally pay” for these costs, the government maintains discretion to refuse to do so in certain situations. No guidance is given as to the factors the government may consider when determining whether a contractor should bear these testing and qualification costs itself. This, coupled with the fact that the revised regulations no longer require contracting officers to consult with the Defense Production Act Office, Title III Program when considering Title III payment requests, indicates that the decision of whether a contractor is entitled to testing and qualification costs may now be decided inconsistently on a case-by-case basis.
Previously, Subpart 34.2 protected offerors from being excluded from consideration for contract award simply because their proposed Earned Management Value Systems (EVMS) were deemed noncompliant with federal standards. The proposed revised regulations contain no such protection, and consequently, could have the effect of excluding offerors from consideration for contract award without any discussion or opportunity to make their proposed plans compliant. The proposed revised regulations also remove from the FAR all detailed policy and procedural guidance relating to Integrated Baseline Reviews. This removes transparency for contractors, as different agencies may consider different factors when assessing a proposed EVMS.
The proposed revisions to sections 52.234-1 and 52.234-4 in FAR Part 52 modify the language of the Industrial Resources Developed Under Title III, Defense Production Act and Earned Value Manage System contract provisions to align with the proposed revisions to FAR subparts 34.1 and 34.2 outlined above.
Comments Due Date
Comments are due by September 30, 2025, at 12 PM.
Key Takeaways
- FAR rewrites will be implemented in two phases:
- FAR Council deviation guidance
- Formal rulemaking
- FAR rewrites will be released on a rolling basis on the designated Revolutionary FAR Overhaul (RFO) website with an expectation that related agency-specific deviations will be implemented within 30 days.
- Non-statutory-based FAR provisions will expire four years following their effective date unless the FAR Council renews them.