Overview of Government Contracts Law

Government contracts involve businesses making agreements with federal, state, or local government agencies. The government procurement process is highly regulated. For federal government contracts, Federal Acquisition Regulations (FAR) guide contract terms and compliance requirements. There are also specific procedures for contract administration and performance disputes and claims.

With a lot of money at stake, there is competitive bidding and proposals for government contract awards. Government contract law can vary by state. For legal advice, talk to a local government contracts attorney.

What Are Government Contracts?

A government contract is a legal agreement between a business and government entity to provide goods or services. The federal government is one of the largest buyers of goods and services. State and local government agencies also contract with businesses.

Government contract law involves how parties bid, award, and perform under government contracts. It also governs what happens if there is a breach or contract dispute. Government contract law can overlap with other legal areas, including administrative law and intellectual property law.

There are strict procurement law requirements for competitive bidding, solicitation, and contracting opportunities. This encourages competition and open accounting for taxpayers and the public. Large government contracts are often subject to strict audit and oversight requirements.

For some government contracts, there are special set-aside programs to award contracts to small businesses in specific socio-economic categories. These include Small Business Administration (SBA), women-owned, and veteran-owned companies.

Find top Government Contracts lawyers easily

Connect with a qualified attorney today.

Find a lawyer today

Types of Government Contracts

There are varying types of contracts, including:

• Fixed-price contracts
• Cost-reimbursement contracts
• Time and material contracts
• Flexible indefinite delivery/indefinite quantity contracts

What type of contract is used can depend on the kind of good or service being provided, supply chain issues, and government needs.

Government Contracting Process

The government contracting process is highly regulated. The government uses contracting officers to enter into contracts on behalf of the government. Contracting officers can solicit, award, oversee, and terminate contracts for the government.

Government contracting generally starts with a government agency identifying a need for services or products. The agency solicits bids and quotations using:

• Request for quotation (RFQ)
• Invitation for bid (IFB)
• Request for proposal (RFP)

The federal procurement window is only open for a limited time, but can be extended. The government evaluates bids and negotiates with companies before entering a contract. Once the parties agree on the terms of the contract, the government awards the contract to the company. The parties are generally bound by the terms and conditions of the contract.

For bid protests, businesses can take their disputes to the Government Accountability Office (GAO) to challenge contract awards or solicitation terms. When there are contract disputes, the government contracting officer handles dispute claims.

Government contractors can appeal the contracting officer’s decision to the U.S. Court of Federal Claims or the Boards of Contract Appeals.

Key Regulations in Government Contracting

There are several federal laws regulating government contracting. These laws are regularly updated by federal agencies, including the General Services Administration (GSA) and the U.S. Department of Defense (DOD). Federal contracting laws and regulations include:

• Federal Acquisition Regulation (FAR)
• Department of Defense FAR Supplement
• Federal Acquisition Streamlining Act (FASA)
• Contract Disputes Act
• Anti-Deficiency Act
• Administrative Procedures Act
• Armed Services Procurement Act
• False Claims Act

State and local regulations deal with local government contracting requirements. To understand state and city government contract regulations, talk to a local government contract lawyer.

Common Issues in Government Contracts

The most common issues that companies deal with in government contracting are navigating government requirements, the bidding process, and contract disputes.

Parties make offers or bids to provide certain goods or services for a negotiated price. There are common terms of the contract, including conforming products, delivery terms, payment terms, and dispute resolution procedures. A well-drafted contract provides clarity and predictability for all parties.

If either party fails to perform under the terms of the government contract, there is a breach. Resolving a breach of contract is often different for government contracts as compared with other types of contracts. Many government contracts have specific provisions allowing the government to unilaterally modify or terminate the contract. These include a changes clause, termination for convenience clause, or default clause.

There are also specific requirements for contract disputes. Contractors must follow the federal Contract Disputes Act to deal with disputes. Government agencies also have immunity from many types of claims, which may limit the contractor’s legal remedies.

When You Need a Government Contracts Lawyer

If you are a contractor or interested in contracting with the government, a contract attorney can offer important legal advice. An experienced government contract lawyer can explain the contracting process and the risks and benefits of government contracting. An attorney can help you negotiate with the contracting officer to win the government contract award.

An attorney can also help with any contract disputes to protect your investment. For specific legal help, contact a local government contracts lawyer.