Doing business with the federal government historically has been competitive but relatively stable. Now, while the competition may remain, stability and certainty have all but disappeared. The uncertainty began with the flurry of Executive Orders issued during the first year of the second Trump Administration, including the kickoff of the “Revolutionary” Federal Acquisition Regulation (FAR) Overhaul (RFO).
The RFO represents an ambitious effort to fundamentally overhaul the FAR. Whether the RFO is necessary or prudent is a matter on which reasonable minds can—and surely will—disagree. What is beyond dispute, however, is that the RFO has introduced a period of profound uncertainty for the contracting community. Companies that have spent the better part of 40 years building compliance infrastructures, developing institutional knowledge and calibrating their business practices around established procurement norms now find themselves in uncharted waters. Every facet of the FAR — from pricing and cost allowability to subcontracting and socioeconomic requirements — is suddenly subject to reexamination, and contractors must adapt to this shifting landscape in real time, often without the benefit of clear guidance or settled interpretations.
Brief Background
On April 15, 2025, President Donald Trump issued Executive Order 14275 “Restoring Common Sense to Federal Procurement,” building on the administration’s approach to deregulation and jumpstarting the FAR Overhaul. The EO noted it is “the policy of the United States to create the most agile, effective, and efficient procurement system possible,” explaining that “[r]emoving undue barriers, such as unnecessary regulations, while simultaneously allowing for the expansion of the national and defense industrial bases is paramount.” To effectuate this purpose, the EO ordered that the FAR may contain only provisions required by statute or “essential to sound procurement” and the provisions that “do not advance these objectives” must be removed.
The EO required the director of the Office of Management and Budget to issue a memorandum to guide agencies on implementation, which Russell Vought issued May 2. Thereafter, the FAR Overhaul since has proceeded in two phases: (1) the FAR Council issues model deviations for each FAR Part and agencies issue agency-specific class deviations and (2) the FAR Council undertakes formal rulemaking.
As part of Phase 1, the FAR Council issued Version 2 of the FAR Companion Guide on Oct. 30, updating the initial Guidance issued in September and adding guidance on additional FAR Parts (though not all). These “Companion Guides” aid acquisition officials by providing context, additional information and practical advice for planning, awarding, managing and closing out contracts. While these Companion Guides may give insight into how federal government acquisition officials might exercise their discretion, contractors are not the intended audience, so contractors should be mindful before relying on the Companion Guides to inform their procurement decisions.
Phase 2, formal rulemaking using notice and comment, has not yet begun.
Key FAR Overhaul Takeaways
We’ve written previously detailed breakdowns about how the FAR Overhaul affects cybersecurity and small businesses. Below are some other key changes contractors should keep in mind as they make procurement decisions.
- RFO FAR Part 4 (Administrative and Information Matters): Consolidated SAM.gov requirements from six clauses down to two, streamlined entity-level representations and certifications by eliminating procurement-specific and offeror-submitted certifications, and relocated all security-related provisions to the new consolidated RFO FAR Part 40.
- RFO FAR Part 6 (Competition Requirements): Significantly streamlined from five subparts to three, with Subpart 6.1 renamed “Presolicitation” to combine full and open competition policies, justification and approval requirements, and Advocates for Competition duties—while consolidating all small business set-aside authorities into two sections and simplifying J&A thresholds using a plain language table format.
- RFO FAR Part 8 (Required Sources of Supplies and Services): Removed Federal Supply Schedule (FSS) ordering procedures previously in FAR Subpart 8.4 and relocated them to GSA Acquisition Manual (GSAM) Subpart 538.71, requiring contractors and contracting officers working with FSS contracts to now reference GSA-specific guidance rather than the FAR.
- RFO FAR Part 9 (Contractor Qualifications): Relocated Contractor Teaming Arrangements (former Subpart 9.6) and Defense Production/R&D Pools (former Subpart 9.7) to the non-regulatory FAR Companion Guide, giving acquisition teams more flexibility while removing prescriptive teaming requirements from the regulatory text.
- RFO FAR Part 10 (Market Research): Added Section 10.001(f) requiring agencies to procure commercial products and services “to the maximum extent practicable” and established a five-tier priority order: (1) commercial products on existing governmentwide contracts; (2) modified requirements to use existing contracts; (3) commercial products from other sources; (4) modified commercial products; and (5) non-developmental items.
- RFO FAR Part 12 (Acquisition of Commercial Products and Commercial Services): Underwent significant restructuring to streamline commercial acquisition procedures and better align federal procurement with commercial practices, potentially attracting new vendors to the federal marketplace.
- RFO FAR Part 15 (Contracting by Negotiation): Underwent significant changes to streamline negotiated contracting procedures, enhance contracting officer discretion and reduce prescriptive requirements in the competitive proposal process.
- RFO FAR Part 16 (Types of Contracts): Underwent significant changes to contract-type selection and administration, providing acquisition teams with greater flexibility in structuring contracts while removing duplicative guidance found elsewhere in the FAR.
- RFO FAR Part 19 (Small Business): Streamlined and reorganized to align with the acquisition lifecycle while notably retaining the “rule of two” for set-asides, clarifying that the rule does not apply to orders under multiple-award contracts (which remain within CO discretion) and expressly stating that exercise of such discretion may not be a basis for bid protest.
- RFO FAR Part 25 (Foreign Acquisition): Streamlined Buy American provisions while retaining domestic content tests and trade agreement exceptions, adopting a centralized waiver process requiring submission to the Made in America Office (MIAO) and posting to MadeinAmerica.gov and relocating “Prohibited Sources” content to RFO FAR Part 40.
- RFO FAR Part 27 (Patents, Data, and Copyrights): Underwent significant revisions to intellectual property and data rights provisions, streamlining procedures while retaining core statutory protections for government rights in technical data and computer software.
- RFO FAR Part 33 (Protests, Disputes, and Appeals): Reorganized to reflect administration priorities to reduce protests and resolve them at the lowest level possible, adding a purpose statement emphasizing the protest system should not be used to delay contract transitions or obtain post-award explanations, while requiring COs to report protests to HCAs and provide protesters redacted source selection decisions for independent review.
- RFO FAR Part 35 (Research and Development Contracting): Moved from a prescriptive, specialized framework to a streamlined, principles-based approach organized around the acquisition lifecycle (Pre-solicitation, Evaluation/Award, Post-award), removing duplicative sections on subcontracting, data, patents, insurance and government property that are covered elsewhere in the FAR.
- RFO FAR Part 36 (Construction and Architect-Engineer Contracts): Comprehensively revised with structural reorganization aligned to the acquisition lifecycle, removal of the “12% rule” (which required prime contractors to perform a minimum percentage of work with their own forces), an almost 20% reduction in clauses, and elimination of mandatory site inspection and preconstruction conference requirements.
- RFO FAR Part 40 (Information Security and Supply Chain Security): Consolidated security-related provisions previously scattered across FAR Parts 4 and 25 into a unified framework, merging over a dozen provisions and clauses into four streamlined instruments covering Kaspersky Lab, Section 889 telecommunications prohibitions, ByteDance/TikTok, FASCSA orders and prohibited foreign sources.
- RFO FAR Part 42 (Contract Administration and Audit Services): Starting April 1, agency past performance evaluations will no longer be marked "Source Selection Information," allowing ratings and supporting narratives to be used more broadly beyond future source selection decisions — a significant shift in how contractor performance history may be accessed and utilized.
- RFO FAR Part 44 (Subcontracting Policies and Procedures): Streamlined subcontracting policies with changes to consent requirements and oversight procedures, consolidating guidance while providing acquisition teams greater flexibility in managing subcontractor relationships.
The RFO implemented significant changes to FAR Parts 9, 12, 15, 16, 27, and 44 that cannot be sufficiently covered in a summary. More detailed posts will be required to dissect these changes.
Opinions and conclusions in this post are solely those of the authors unless otherwise indicated. The information contained in this blog is general in nature and is not offered, and cannot be considered, as legal advice for any particular situation. The authors have provided the links referenced above for information purposes only and, by doing so, do not adopt or incorporate the contents. Any federal tax advice provided in this communication is not intended or written by the authors to be used, and cannot be used, by the recipient for the purpose of avoiding penalties which may be imposed on the recipient by the IRS. Please contact the authors if you would like to receive written advice in a format which complies with IRS rules and may be relied upon to avoid penalties.
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