Navigating FAR Clauses: A Guide to Subcontractor Flow Downs

FAR Clauses

The Federal Acquisition Regulation (FAR) is a set of rules and procedures that all federal contractors must follow when selling to the government. The FAR is a standardized guide for federal contracting, including the rules and regulations that govern federal procurement, and adhering to these is required by law.

The Basics of FAR Clauses

Organized into 53 parts, the FAR is more than 2,300 pages long and available online with easy search functionality. Each part is broken into sub-parts and numbered clauses covering a wide range of topics. FAR clauses are listed in federal solicitations and carry over into contracts to dictate the terms of the relationships between government agencies and contractors.

The FAR Council provides overall direction, resolves disagreements, and coordinates FAR rules. Made up by specific leaders in the Department of Defense (DoD), the General Services Administration (GSA), and the National Aeronautics and Space Administration (NASA). It is supplemented by several agency-specific additional regulations, such as the Defense Federal Acquisition Regulation (DFARS), which is an extension of FAR focused on the DoD.

Flow Downs

FAR clauses in a contract apply to the prime contractor, and some flow down to any required subcontractors as well. Prime contractors must ensure that its subcontractors are compliant with all applicable flow downs for each individual subcontract.

While every FAR clause applies to prime contractors, not every FAR clause applies to subcontractors. Typically, flow down requirements are triggered when a subcontract exceeds a specific dollar amount. Some clauses are enforced for orders over $3,500 while others are enforced for orders over $150,000. Prime contractors are responsible for knowing the threshold and correctly applying applicable FAR clauses in each subcontract.

Maintaining Compliance

JetCo Federal emphasizes compliance and ensures we honor the rules and meet contract requirements. During the solicitation process, we review the FAR clauses to identify any that are new to us and ensure we can comply. When we are awarded the contract, we create a compliance matrix to establish not only the clauses that apply to us, but also the clauses that flow down to our subcontractors. We communicate expectations and flow down requirements on every subcontract. Finally, JetCo routinely checks in to ensure compliance is an ongoing protocol and to rectify any deviations.

JetCo Federal plans for compliance before we bid on a solicitation. This gives us a strong foundation for success after the award.

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