Overview
This section identifies specific federal statutes and regulations that are either waived or modified for subcontracts at any tier involving the acquisition of commercial products or commercial services. It serves to reduce administrative burdens and align government subcontracting requirements with standard commercial practices.
Key Rules
- Complete Exemptions: Numerous laws are rendered inapplicable to commercial subcontracts, including the Drug-Free Workplace Act, the Fly American Act, and the requirement for minimum response times for offers.
- Labor and Safety: The Contract Work Hours and Safety Standards statute (40 U.S.C. 37) requirements for certificates and clauses are explicitly waived for commercial subcontracts and components.
- Modified Applicability: Certain critical laws are not fully waived but are modified in their application, specifically those concerning Truthful Cost or Pricing Data (formerly TINA), Cost Accounting Standards (CAS), and the prohibition on limiting subcontractor direct sales to the government.
- Specific Exceptions: Some exemptions have "carve-outs" where the law still applies, such as sea transportation requirements under certain conditions or Examination of Records when using American Recovery and Reinvestment Act funds.
- Tier Neutrality: Most of these exemptions apply to subcontracts at any tier, meaning they flow down from the prime to the subcontractor and through the subsequent supply chain.
Practical Implications
- Reduced Flow-Down Burden: Prime contractors have a significantly shorter list of mandatory clauses to "flow down" to subcontractors when purchasing commercial products or services.
- Market Accessibility: By removing government-unique requirements like CAS and the Drug-Free Workplace Act for subcontractors, the government makes it easier for non-traditional commercial firms to participate in federal procurement.