Overview
FAR 3.1106 prescribes the mandatory use of the clause at 52.203-16 to prevent personal conflicts of interest in service contracts where contractor employees perform acquisition functions closely associated with inherently governmental functions.
Key Rules
- Threshold: The clause must be included in solicitations and contracts that exceed the simplified acquisition threshold (SAT).
- Applicability: It applies specifically to contracts involving services where contractor employees perform acquisition functions closely associated with inherently governmental functions on behalf of a Federal agency.
- Partial Performance: If only a specific portion of the contract involves these functions, the clause is still mandatory but its application is limited to that specific portion.
- Self-Employed Exemption: The clause is not required for contracts with self-employed individuals if they are performing the acquisition functions entirely by themselves rather than through employees.
Practical Implications
- Contractor Compliance: Firms winning these contracts must implement internal procedures to screen employees for financial interests or relationships that could bias their advice to the government.
- Scope Identification: Contracting officers must carefully evaluate the Statement of Work (SOW) to determine if tasks (such as drafting specifications or evaluating proposals) trigger this requirement, even if those tasks are only a minor part of the overall contract.