Tuesday, October 06, 2009

FAR Part 3: Ethics & The No Free Lunch Rule

Avoid Toxic Coffee Syndrome

Part 3  of the FARS is about procurement integrity. Its full name is Improper Business Practices And Personal Conflicts Of Interest.

Here are three reasons why you care, and where it says so:

1.   How not to lose your contract
In general, government officials can't seek or receive coffee, lunch, gifts or entertainment from a contractor. (FAR Part 3.101-2) So don't offer. Individual agencies are allowed to have their own rules about this, so if you're uncertain, look up their rules online and/or ask the contracting officer to confirm your understanding.

Pay Attention: if you do so with intent to get favorable treatment on a contract worth more than $100,000, your contract can be cancelled (FAR Part 52.203-3).

2.  How to protect your business secrets
Find out how to mark your documents to prevent the government giving competitors sensitive business information from your proposal (FAR 3.104.4). This really can happen if you don't watch out.

3. How to avoid shady practices
Whether you're a prime or a subcontractor, ethics rules apply to you. Those rules prohibit things like kickbacks, contingent fees, and under-bidding today in order to raise prices after award. If you're even remotely concerned about whether a business practice is legitimate and permitted, run, do not walk, to FAR Part 3. It's not long, but it's very clear.

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