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StePa

Where/ How to start learning?

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Hello, 

I recently joined the forums and have been reading several topics to familiarize myself with some topics, issues, etc. 

I am new to the realm of government contracting and see that my employer works as a subcontractor. 

I am attempting to learn the FAR / DFARS as these seem to apply to my employer the most and have come across these in our company's terms and conditions. I have been tasked to try to look through the FAR to update the list of clauses that would apply to our terms & conditions if any. 

Finally, my question:

Is the best avenue of approach to simply read the FAR and DFARS line by line, with an eye out for required flowdown clauses? 

or 

Is there another approach you would recommend to self start this project? 

Thank you. 

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You're in the right place. Reading as much of this discussion forum (and website) as possible will be very helpful. 

You might try reading your subcontracts line by line, and tracing the flowdown clauses back to the FAR or DFARS. 

National Contract Management Association (NCMA) is a helpful group to join and they offer a monthly journal which is worth the price of membership. 

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Not sure whether your assignment is as a contracts person trying to determine how to review and negotiate terms and conditions of your company's contracts with a prime contractor or whether your assignment is with respect to flowdowns to subcontractors derived from your company's prime contract terms and conditions. Or, is your assignment with respect to both the above? Makes a difference as to learning focus. You may already be aware that FAR/DFARS terms and conditions generally guide Government and do not obligate contractors or subcontractors except where specifically mentioned and incorporated in the contract between the Government and the contractor And, when so incorporated, some such terms and conditions are expressed as mandatory flowdowns to subcontractors, which may require that the 1st level subcontractor flow it to its subcontractors. Other terms flowed to subcontractors by contractors may be business flowdowns which may or may not need to be further flowed by the 1st level subcontractor. Sufficiently confused? Very normal, and you may find different positions regarding a term and condition taken by people which may or may not be in line with your most knowledgeable current position. Try to learn the bases for their position and make up your own mind.     

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Hi Neil. I believe my assignment is in respects to both. 

I am familiar with that there are mandatory flowdowns and others that are not mandatory but "recommended" (Not sure what the proper term to use is) according to many things I've read. I think you've nailed it on the head stating I "may find different positions regarding a term and condition take by people..." which is where I got stuck since it's a new area of study for me. 

I will read the relevant provisions and see how they apply and figure out what applies. 

I don't know if anyone would have experience here but how does one go about knowing if new mandatory or "recommended" clauses were added. I assume that they would be referenced in the sections which list the mandatory clauses / "recommended" clauses but I've learned that assumptions are dangerous. :( 

Thank you. In the meantime, time to grind them out 1 by 1. 

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StePa,

Suggest you obtain a free email subscription to the Federal Register to keep abreast of new contract clauses and provisions. Check daily under Department of Defense and GSA (GSA handles FAR) for final final FAR/DFARS regulations. If you want to be a real student, read all the proposed ones as well and get involved with commenting on them. Happy adventure!

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Here's how to find the FAR and DFARS mandatory flowdown clauses that primes must include in subcontractors and that subcontractors must flowdown to their subcontractors, and so on. See, e.g., FAR 52.215-12. Do the following:

1. Go to https://www.acquisition.gov/browsefar and download the current FAR in pdf format.

2. Do an Adobe search of FAR Part 52 for the terms subcontract and subcontractor. Check each clause that comes up for text similar to that of FAR 52.215-12, paragraph (c), which is a mandatory flowdown requirement. Each clause that contains such a requirement is a mandatory flowdown clause.

You must do the same thing to find DFARS mandatory flowdown clauses. The process is a little tedious, but not as tedious as reading the FAR and DFARS "line by line." You can learn a lot while doing it.

The other kind of flowdown clause could be described as "necessary." They are ones that a contractor or subcontractor must flow down to its subcontractors so that it can fulfill its obligations to its customer and otherwise protect itself. Examples include FAR 52.243-1 and 52.249-2. If you are new to government contracting, then identifying such clauses is probably beyond your capability.

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@Neil Roberts Thank you Neil. Just subscribed

@Vern Edwards Thank you Vern. I will follow your advice. Do you have any advice on how to become better at identifying clauses like "necessary" flowdown clauses? Is it just experience or is there any other ways to self-improve/ self-learn. I have found a free seminar in DC that I will try to ask my boss if I can attend but other than that, I'm all ears for any suggestions. 

 

 

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In order to identify "necessary" (but not mandatory) flowdown clauses, you have to read the clauses in your company's contract and determine what it require or potentially requires your company to do or refrain from doing. Then you have to think about what work you have hired a subcontractor to do and think about how if at all the clause in your contract might require something of your company that is being done by a subcontractor.

For instance, suppose that your contract includes a changes clause giving the customer the right to unilaterally modify the work specification, and suppose that some of the work is being done by a sub. Now suppose that the customer issues a change order modifying the specification for the work that is being done by the sub. If you don't have a changes clause in the subcontract, you may not be able to issue a change order to the sub, passing on the change order from the customer. What if the sub refuses to go along? How can you comply? So you must include a changes clause in the subcontract to ensure that you can order the sub to comply. What if your customer can terminate your contract for convenience and you don't have a clause allowing you to terminate your subs?

Thus, in order to identify necessary clauses you have to read and analyze your contract clauses, think about what they obligate or contingently obligate you to do or refrain from doing, and include clauses in subcontracts that allow you to pass on those obligations and contingent obligations to your subs. You need a lot of legal and technical know-how and experience to even understand the clauses in your company's contract, much less determine what obligations and contingent obligations you might need to pass on to your subs. That's not the kind of work that I would assign to a newbie, even for training purposes. It's not an easy thing. You need some prep study and time on the job before you can do reliable work at that kind of analysis.

Baby steps.

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54 minutes ago, Vern Edwards said:

What if your customer can terminate your contract for convenience and you don't have a clause allowing you to terminate your subs?

I actually encountered that situation. It was expensive for the prime.

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Aside from flowing down the right requirements on the subcontractor side of the business, if you are also the company's negotiator with customers on the contracts side of the business, you need to be aware that there are terms and conditions (FAR/DFARS/Uniform Commercial Code, etc.) that your company should think about negotiating for inclusion into the customer contract, which are not being proposed by your customer. These are not as obvious as the process for handling the subcontractor side of the business. Perhaps others in this forum could recommend learning tools for you. Examples include data rights and liability.       

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There also might be clauses you do not want to be included in your contract that gives a certain degree of rights in data or liability, for example. I’d be cautious about primes giving a blanket set of flow down clauses that might require a sub to do something that the sub shouldn’t have any business doing.

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