OFPP upholds GSA policy

The Office of Federal Procurement Policy today overruled a protest by an association of government contractors that sought to abolish the General Services Administration's policy of allowing agencies to conduct audits after a contract is awarded and demand price adjustments.

The Government Electronics and Information Technology Association filed its protest in June, arguing that a GSA price-reduction clause did not comply with the Federal Acquisition Regulations. Under the policy, agencies have two years from the date a contract is awarded to verify discount information submitted by vendors through post-award audits.

However, OFPP decided that it is reasonable for GSA to use the clause to negotiate good initial prices on contracts instead of relying on head-to-head vendor competition.

"Though these practices are not commercially customary, OFPP has determined that their use is reasonable—and in concert with the FAR requirement to be consistent with customary commercial practice to the maximum extent practicable," the decision states.

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