The US administration on April 15, 2025 issued an executive order that directs prompt and substantial reforms to the Federal Acquisition Regulation (FAR). The order, titled Restoring Common Sense to Federal Procurement, instructs the Office of Federal Procurement Policy administrator (OFPP Administrator) and the FAR Council to work together with the heads of agencies and senior procurement officials to review the FAR and rescind provisions that are not required by statute or otherwise necessary to support efficient procurement or to protect economic or national security interests.
The new executive order instructs a fulsome review of the FAR and agency FAR supplements and tasks agencies to trim those regulations to the extent permissible under law. The OFPP Administrator and FAR Council are ordered to complete this review by October 12, 2025. Any FAR or FAR supplement clauses that are not required by statute and that do not promote the US administration’s policy objectives of ensuring an agile, efficient, and effective procurement system must be rescinded, unless they advance economic or national security objectives. The OFPP Administrator and FAR Council are directed to consider adding four-year sunset provisions to any FAR clauses that are not required by statute but are kept in the FAR.
By May 5, 2025, the director of the Office of Management and Budget (OMB) is instructed to issue a memo to agencies that provides guidance on consistent implementation of the executive order’s mandates. That memo must also propose new agency FAR-supplement regulations and internal guidance to promote expedited and streamlined acquisitions. Agencies must repeal at least 10 regulations for every new regulation that is issued.
In the meantime, OFPP Administrator and the FAR Council are instructed to issue class deviations and interim guidance. Class deviations temporarily authorize agencies to issue, modify, or remove certain FAR clauses from solicitations and contracts. While the executive order instructs the OFPP Administrator and the FAR Council to issue deviations, class deviations are typically authorized by the Civilian Agency Acquisition Council and issued by individual federal agencies. Agencies can issue class deviations without following the standard notice-and-comment rulemaking process. Agencies have already begun to use class deviations to remove FAR clauses that have been rescinded by previous US administration executive orders.
For example, to implement Executive Order 14173, Ending Illegal Discrimination and Restoring Merit-Based Opportunity, many agencies have issued class deviations that authorize contracting officers to remove FAR 52.222-26 (Equal Opportunity) from contracts.
While this executive order directs agencies to make significant changes to government contracts over the next several months, contractors and subcontractors should be mindful that class deviations and revisions to the FAR do not apply to individual government contracts until those contracts are amended to include them.
Time will tell whether this executive order will produce substantive change for federal contractors. While this order may reduce overall compliance burdens by trimming down the FAR provisions that contracting officers are instructed to include in contracts, many FAR clauses that impose significant compliance burdens are likely to remain—either because they are rooted in statute or because they promote national security interests.
For example, clauses such as those implementing the Cybersecurity Maturity Model Certification program are unlikely to be affected by these reforms because they promote cybersecurity interests. Other clauses, such as the FAR’s Combatting Trafficking in Persons clause, are required by statute.
That said, agencies have shown that they are committed to taking full advantage of class deviations to swiftly implement the regulatory changes that the US administration has directed to date. In turn, contractors have seen a steady stream of contract modifications implementing the changes those deviations authorize. As agencies review and revise the FAR and FAR supplements, contractors can expect to see those changes trickle down relatively quickly and should be on the lookout for any substantive contract modifications.
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