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Panoptic Enterprises' FEDERAL CONTRACTS DISPATCH

DATE: April 15, 2005

SUBJECT: Office of Management and Budget (OMB); Use of Brand Name Specifications

SOURCE: OMB Memorandum dated April 11, 2005

AGENCIES: OMB

ACTION: Notice

SYNOPSIS: On April 11, 2005, David Safavian, Office of Federal Procurement Policy (OFPP) Administrator, and Karen Evans, Office of Electronic Government and Information Technology Administrator, issued a joint memorandum to chief acquisition officers (CAOs), senior procurement executives (SPEs), and chief information officers (CIOs) to “reinforce the need to maintain vendor neutral contract specifications and to ensure that agencies strictly comply with the requirements in the Federal Acquisition Regulation (FAR) regarding the use of brand name specifications.”

FOR FURTHER INFORMATION CONTACT: Rob Burton, OFPP Associate Administrator, 202-395-7579.

SUPPLEMENTAL INFORMATION: FAR 11.105, Items Peculiar to One Manufacturer, states, “Agency requirements shall not be written so as to require a particular brand-name, product, or a feature of a product, peculiar to one manufacturer, thereby precluding consideration of a product manufactured by another company, unless the particular brand name, product, or feature is essential to the government's requirements, and market research indicates other companies' similar products, or products lacking the particular feature, do not meet, or can not be modified to meet, the agency's needs.”

In their joint memorandum Mr. Safavian and Ms. Evans express concern “that the use of brand name specifications in agency solicitations may have increased significantly in recent years, particularly for information technology. For example, some federal agencies have issued solicitations with specifications for brand name microprocessors that are associated with a single manufacturer. Rather than issue brand name specifications for microprocessors, agencies should either: 1) articulate a benchmark for performance; or 2) specify the requirements for applications and interoperability.”

Safavian and Evans admit that “the increased use of brand name specifications is not limited to information technology procurements. For example, last year a federal agency issued a request for quotations (RFQ) for approximately $81 million in office supplies. Throughout the RFQ, office supplies were identified by a vendor number unique to one large office supply company. In these examples, the use of brand name specifications limited competition and diminished the likelihood the agency purchased the best value product. There is also a significant risk of severely limiting small business participation in these cases.”

Therefore, to ensure agencies are providing for maximum competition and are purchasing the best products to meet agency needs, “we are requesting that agencies take steps to mitigate brand name usage. As a general rule, contract specifications should emphasize the necessary physical, functional, and performance characteristics of a product, not brand names. In cases where the use of a brand name associated with a single manufacturer is warranted, the FAR currently requires a written justification. Effective immediately, we are asking agencies to publicize the justification with the contract solicitation when the solicitation is posted on the Federal Business Opportunities website (http://www.fedbizopps.gov). If publication of the justification is inappropriate because of national security, trade secrets, or similar concerns, agencies should provide a copy of the justification to the Office of Federal Procurement Policy...this guidance applies to all acquisitions, including simplified acquisitions, GSA (General Services Administration) purchases, and sole source procurements.”

EDITOR'S NOTE: This justification has been a requirement since enactment of the Competition in Contracting Act in 1984. Paragraph (c) of FAR 6.302-1, Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements, states, “An acquisition that uses a brand name description or other purchase description to specify a particular brand name, product, or feature of a product, peculiar to one manufacturer does not provide for full and open competition regardless of the number of sources solicited. It shall be justified and approved in accordance with FAR 6.303 [Justifications] and 6.304 [Approval of the Justification]. The justification should indicate that the use of such descriptions in the acquisition is essential to the government's requirements, thereby precluding consideration of a product manufactured by another company.” In addition, these justifications have been available to the public upon request (see FAR 6.305, Availability of the Justification), and those who believed they were being wrongfully excluded from competition could challenge the justification under the protest procedures in FAR Subpart 33.1, Protests. What this memorandum does that is new is require that the justification be published on FedBizOpps along with the solicitation. Bringing such justifications out into the public should make contracting officers a little more careful about invoking this exception to competition.

FOR FURTHER INFORMATION CONTACT: Panoptic Enterprises at 703-451-5953.

Copyright 2005 by Panoptic Enterprises. All Rights Reserved.

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