Red light put on 'blacklisting'

Federal contracting officers and industry contractors last week got a sign from the Bush administration that—at least for now—they won't have to worry about a government requirement that agencies consider vendors' ethics when making awards. The Federal Acquisition Regulation Council has officially put on hold the rule it calls "the most controversial ever published by the FAR Council."

The council published the final contractor responsibility rule, better known to industry as the "blacklisting" rule, on Dec. 20, 2000, and it went into effect Jan. 19. It requires that agency contracting officers consider a vendor's record of business integrity and ethics, including its record in legal matters such as employment, environmental, antitrust and consumer protection.

The council suspended the rule for 270 days to reassess its advantages and disadvantages, according to a Federal Register notice published April 3.

The council said it received almost 1,800 comments before the Dec. 20 publication, while the typical FAR rule generates about 1 percent of that number. Almost all said that "the rule is not in the best interest of industry or the government, the way it is written," according to the notice. The comments continued even after several agencies started incorporating the rule into their contracts in January. The suspension follows another move to delay the rule by the Civilian Agency Acquisition Council. Recognizing comments received by the FAR Council from government and industry, the CAAC sent a memo Jan. 31 to agency heads recommending that they delay implementing the rule until July 19.

President Bush made it clear since taking office that he intended to rescind the rule, and the White House applauded the move by the FAR Council.

"We believe that that rule was overly broad and onerous, so now it is going through a review so we can determine the best step to take as we move forward," said Scott McClellan, a White House spokesman.

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