The federal procurement system is set to undergo significant reforms following a directive from the President. The directive, formalized as part of an Executive Order, prioritizes efficiency and simplicity in federal acquisitions that currently operate under the complex Federal Acquisition Regulation (FAR). The regulation has grown to over 2,000 pages, earning criticism for inefficiency.
"More than 40 years ago, the Federal Acquisition Regulation (FAR) was implemented to establish uniform procedures for acquisitions across executive departments and agencies (agencies)," states the directive. However, the regulation has reportedly become "an excessive and overcomplicated regulatory framework."
Notable assessments include a 2024 Senate committee report titled "Restoring Freedom’s Forge," and a 2019 report by the Advisory Panel on Streamlining and Codifying Acquisition Regulations. Both identify the FAR as a barrier to effective business with the federal government. The Executive Order highlights that these inefficiencies impact the handling of nearly $1 trillion annually in procurements.
Executive Order 14192, issued on January 31, 2025, previously established a policy of deregulation to alleviate burdens on the American public. Reform of the FAR aims to align with this broader deregulatory policy. The order directs that, "the FAR should contain only provisions required by statute or essential to sound procurement."
The directive mandates that within 180 days, necessary amendments should be made to the FAR to simplify processes while aligning with national and economic interests. The Administrator, alongside the Federal Acquisition Regulatory Council and other key officials, will spearhead these efforts.
For agencies working under the FAR, the order stipulates immediate actions to ensure alignment with these reforms. This includes appointing senior acquisition officials to facilitate collaboration and provide recommendations on any supplemental regulations. The Office of Management and Budget will issue guidance to ensure consistency across agencies.
"The Administrator and the FAR Council shall issue deviation and interim guidance, as appropriate and consistent with applicable law, until final rules reforming the FAR are published," notes the directive. It also introduces a regulatory sunset clause where any non-essential FAR provision could expire four years post-final rule unless renewed.
The Executive Order assures that these changes respect existing legal authorities and will be implemented within the confines of available resources. It "is not intended to, and does not, create any right or benefit" enforceable against the U.S. or its entities.
The effort is presented as a path to make federal procurement more agile and effective, while strengthening economic and national security interests.
