Problematic Aspects Of DOD Commercial Item Rule

By Angela Styles and Josh Freda (February 8, 2018, 1:02 PM EST) -- Six weeks after the passage of the 2018 National Defense Authorization Act,[1] the U.S. Department of Defense issued a final rule implementing commercial item provisions contained in the 2016 NDAA.[2] The new rule contains significant changes to the Defense Federal Acquisition Regulation Supplement to treat products and services from nontraditional defense contractors as commercial items, require the recognition of prior commercial item determinations from other DOD components agencies, and add a new contract clause for certain commercial item contracts and subcontracts. Curiously, in implementing the 2016 NDAA commercial item provisions, the final rule ignores updated and conflicting commercial item provisions in the 2017 and 2018 NDAAs and creates layers of bureaucracy and cost for contractors and contracting officers. At a time when Congress and the White House are making marked strides to reduce the regulatory burden, the final rule adds significant burdens to commercial item contracting. Particularly ironic, the final rule was issued on the same day as the Section 809 panel (also created by the 2016 NDAA) released the first of three volumes on streamlining DOD acquisition regulations — with a clear focus on streamlining commercial item contracting.[3]...

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