The Revolutionary FAR Overhaul: A First Step

The Trump administration has published the first tranche of reforms to the Federal Acquisition Regulation (FAR), part of the “Revolutionary FAR Overhaul” called for by Executive Order and direction from the Office of Management and Budget (OMB). The first tranche of completed rewrites go to FAR Part 1 (which describes how the FAR system is run), Part 34 (major systems acquisitions), and Part 52 (contract clauses). These first proposed changes are true to the direction from President Trump and OMB – they streamline the FAR — but they are, at least for now, relatively modest.

Background

The FAR is the product of 250 years of regulatory development in the United States. As Jim Nagle explained in his landmark history of the U.S. government procurement system, the earliest U.S. law on procurement in 1775 drew on lessons from Europe and was used to support the Continental Army. The U.S. procurement system evolved over time (see C. Yukins, The U.S. Federal Procurement System: An Introduction) but the federal government’s procurement rules were not unified for over two centuries, until the FAR came into effect on April 1, 1984.

The FAR and its agency-specific supplements have become an extraordinary “operating manual” for the federal procurement community. While the FAR is dense (it is several thousand pages long), it reflects the accumulated learning of over two centuries of public procurement, almost certainly the longest unbroken commitment in modern times to the rule of law and a well-ordered procurement system. The FAR serves as the backbone to what many believe is the world’s most sophisticated procurement system, and dismembering the FAR could have serious implications for our nation’s security and well-being.

At the same time, however, President Trump was elected on a strongly anti-regulatory platform. In his first days in office he called for the elimination of ten old regulations for every new one (EO 14192), and on April 15, 2025 he issued Executive Order 14275, Restoring Common Sense to Federal Procurement, which mandated a comprehensive overhaul of the FAR.

The executive order said that, within 180 days (i.e., by mid-October), the Federal Acquisition Regulation Council (FAR Council), working with the Administrator of the Office of Federal Procurement Policy, heads of agencies, and senior procurement officials, “shall take appropriate actions to amend the FAR to ensure that it contains only provisions that are required by statute or that are otherwise necessary to support simplicity and usability, strengthen the efficacy of the procurement system, or protect economic or national security interests.”

In a May 6, 2025 press release regarding the FAR overhaul process, the General Services Administration said, besides eliminating non-statutory and duplicative regulations and replacing burdensome requirements with straightforward buyer guides, the overhaul effort will “[r]emove DEI [Diversity, Equity and Inclusion] and wokeness.”

Sunset Requirement

Where the FAR overhaul process leaves provisions in place, under the Executive Order the OFFP Administrator and the FAR Council are to consider whether to set those regulations (or any new FAR provisions not required by statute) to “sunset” (expire) automatically within four years, unless renewed by the FAR Council.

Consistent with the Executive Order, the proposed rewrite would create a global requirement, under a new FAR 1.109, that all “FAR sections that are not required by statute must expire 4 years after the effective date of the sections,” unless approved by the FAR Council. The guiding OMB memorandum, discussed below, emphasized that “all FAR requirements not directed by statute that remain in the FAR [after the overhaul] will expire four years after the effective date of the rule unless renewed by the FAR Council.”

This appears to mean that, if provisions of the FAR remain in place once the overhaul is done, those provisions of the FAR will automatically implode after four years unless the FAR Council saves them. Because the rulemaking resulting in a revised FAR may last until 2026-2027, the FAR could collapse in the early 2030s. For the reasons outlined above, this could prove enormously disruptive to the federal procurement system.

OMB’s Plan To Overhaul the FAR

Pursuant to President Trump’s Executive Order, on May 2, 2025 OMB Director Russell Vought issued a memorandum calling for a “revolutionary” overhaul of the FAR.

The OMB memorandum emphasized that the “FAR will be refocused on its statutory roots.”  Most regulations not based on statute, the memorandum said, “will be replaced with OFPP-endorsed buying guides that highlight proven innovative buying techniques for different phases of the acquisition lifecycle as well solutions and manageable procurement pathways for different types of common goods and services recognized by category management.” This embrace of new buying techniques echoes President Trump’s executive order on defense acquisition, and the procurement reforms proposed by Senate Armed Services Committee Chairman Roger Wicker.

The OMB memorandum explained that the “streamlined FAR and buying guides . . . will collectively be referred to as the Strategic Acquisition Guidance (SAG).” The Guidance is to “increasingly leverage technology over time,” to “provide a common-sense authoritative foundation for nimble response and delivery of mission capability.”

The OMB memorandum noted (and the overhaul website now confirms) that the public will be allowed to submit “informal” comments on the proposed changes; though those public comments will be considered, there will be no response from the FAR Council.

According to the OMB memorandum, after “the FAR Council has posted model deviation guidance for all FAR parts, it will turn to formal rulemaking” to overhaul the FAR. The rulemaking (discussed below) “will be informed by the model deviation text, public input on the text . . . , operational experience with agency deviations, recommendations from agency points of contact . . ., testing of the buying guides, and other appropriate inputs.”

How the Revolution Is Unfolding

The FAR overhaul team has now published the first tranche of reforms. The “Revolutionary FAR Overhaul” (or “RFO”) team is led by the Office of Federal Procurement Policy (OFPP) and the Federal Acquisition Regulatory Council (FAR Council). The team has published proposed revisions to FAR Parts 1, 34 and 52. For each overhauled FAR part, and in accordance with the OMB memorandum, the team has presented:

• proposed revised FAR text;
• a “lineout” showing deletions from the current FAR; and,
• model FAR deviations (individual (a deviation applicable to only one contract) or class (deviations which affect more than one contract)) that agencies can use to issue their own deviations to fill the regulatory gap until a rewritten FAR can be formally approved by the FAR Council after public review and comment.

Per the guiding OMB memorandum, agencies are expected to publish deviations within 30 days of publication of the proposed revisions by the overhaul team. By using stopgap FAR deviations and undertaking a full notice and comment process, the FAR overhaul team has reduced the risk of lawsuits challenging abrupt changes to the FAR without the full public process and review called for by 41 U.S.C. § 1707.

Proposed Rewrites: The First Step

The proposed new language for FAR Parts 1, 34 and 52 is relatively spare, which may be due to time constraints – per the Executive Order, as noted, the overhaul process must be completed within 180 days.

The rewrite team is not addressing the FAR parts in strictly numerical order, but has instead first published changes to scattered parts of the FAR. Beyond first streamlining FAR Part 1, which governs the regulators’ own work, it is not clear why the rewrite team leapt ahead to FAR Parts 34 and 52. Doing so, however, has offered important clues to how they might approach other parts of the FAR.

FAR Part 1 – The FAR System

The most thoroughgoing proposed changes are to FAR Part 1, which governs how the FAR is produced, administered and read. The accompanying “lineout” document (though it is not completely accurate) is one way to identify proposed changes to FAR Part 1, which include the following:

• Vision Erased: The overhaul would delete the statement of the FAR’s vision which was quoted in the President’s executive order, “for the Federal Acquisition System . . . to deliver on a timely basis the best value product or service to the customer, while maintaining the public’s trust and fulfilling public policy objectives.” This focus on best value (as opposed to low price) and the emphases on integrity and integrating policy objectives (such as socioeconomic requirements) into procurement have long been hallmarks of the U.S. procurement system. As with other deleted provisions, this statement may be moved to a “buying guide” – the rewrite team did not provide explanations for any of the proposed changes, or indicate what the next steps may be regarding deleted provisions.
• Risk Management Retained: Notably, though many of the guiding principles set forth in current FAR 1.101-2 would be gutted, the revised section would still call for focus on risk management, not risk avoidance. Globally, other leaders in procurement (such as the OECD (2023)) have also stressed that modern procurement is, at its core, an exercise in risk management.
• FAR Rulemaking Process Erased: The proposed rewrite would delete current FAR Subpart 1.2, which describes the role of the FAR Council and other stakeholders in maintaining the FAR, and FAR Subpart 1.5, which governs public participation in rulemaking under the FAR. It is not clear why these provisions were deleted, or whether these important topics (see Sandeep Kathuria’s analysis of the loss of public comments) would be addressed elsewhere, for example in non-binding guidance.

An Example of Legal Questions Raised by the Overhaul

As noted, the overhaul would delete the statement of the FAR’s vision, FAR 1.102 — which was endorsed in the President’s executive order directing the overhaul — “for the Federal Acquisition System . . . to deliver on a timely basis the best value product or service to the customer, while maintaining the public’s trust and fulfilling public policy objectives.” Because there are no accompanying statements of explanation from the overhaul team, it is not clear whether:

• The rewrite team has exceeded its authority, because President Trump, by executive order, has ultimate say over all issues of law in the Executive Branch?
• The rewrite team has considered the case law which rests on this FAR language, such as AvKare, Inc. v. United States (COFC 2016) (a general point that Ralph Nash and Jim Nagle raised in their webcast (above))?
• The rewrite team has the authority under Kisor v. Wilkie (U.S. Supreme Court 2019) to change course dramatically on a longstanding regulation (issued in January 1995)? Kisor (which discussed limits on agencies’ interpretations of their own regulations) was amplified by Loper Bright Enterprises  (U.S. Supreme Court 2024) (where the Court said that agencies are not automatically entitled to deference in implementing statutes through regulations); Loper Bright in turn was embraced by President Trump’s recent executive order on unlawful regulation.  
• If, as OMB strongly recommends, within 30 days other agencies uniformly adopt their own class deviations that match the “model” GSA class deviation erasing this provision, are the other agencies’ class deviations legally authorized by FAR 1.402, which allows only for “deviations . . . when necessary to meet the specific needs and requirements of each agency“? (Emphasis added.) (The proposed overhauled provision, new FAR 1.304, would by amending the regulation arguably expand agencies’ authorities to issue class deviations — which again triggers the question of authority.) 
• The abrupt regulatory change may launch litigation which could delay the final rulemaking (due to begin in October 2025), and whether that in turn will delay the four-year “sunset” provision which is timed to implode the FAR in the early 2030s (see above)?
• This substantive change in rules to be effective must go through the notice-and-comment required by 41 USC 1707?
• Per a GSA press release of May 6, 2025 (see above), this change (1) is to erase non-statutory and duplicative regulations, (2) will be resolved by replacement with a buyer guide, and/or (3) is to “[r]emove DEI and wokeness“? Judicial review of the change could take very different pathways, depending on the purpose of the change.

FAR Part 34 – Major Systems Acquisition

The Trump administration overhaul also would delete FAR Subpart 34.1, which calls for full and open competition in major systems acquisitions. It is not clear why; again, no explanation was provided.

The subpart may have been deleted because current FAR 34.000 states that the subpart was based upon OMB Circular A-109 (see 1979 GAO report), and that OMB Circular was rescinded years ago (see OMB explanation). In fact, however, FAR Subpart 34.1 has a statutory basis as well, because it was updated to conform to the competition requirements of the Competition in Contracting Act of 1984, see 50 Fed. Reg. 1726, 1744 (1985).

Alternatively, Subpart 34.1 may have been deleted because the FAR overhaul team felt that its requirements were redundant to the full-and-open competition requirements in FAR Subpart 6.1.

Regardless of why it was deleted, the unexplained elimination of FAR Subpart 34.1 might be read by some to open the door to noncompetitive procurements of major systems – a potential challenge to the integrity of the procurement system which the FAR overhaul team may address when, in the forthcoming formal rulemaking, they explain why the subpart was deleted.

FAR Part 52 – Contract Clauses

The potential rewrite of FAR Part 52 raised serious concerns across the federal procurement community because the standard contract clauses in Part 52 reflect decades – sometimes centuries — of careful balancing of contractual risks between the government and its contractors. The standard clauses are especially vulnerable because the Trump administration is bent on removing regulations which are not based on statute, and many long-established clauses (such as the Default clause, which can be traced back to procurement imbroglios of the early 1800s) lack any statutory basis. But a wholesale elimination of FAR Part 52 and its hundreds of standard clauses would mean throwing away centuries of learning, and potentially upending thousands of contracts (and subcontracts, which often rest upon the same clauses).

The proposed overhaul of FAR Part 52 appears to be much more modest. The overhaul team has identified only two clauses which would be amended as a collateral consequence of the reforms to FAR Part 34, discussed above. The overhaul team has not, however, proposed class deviations which agencies might use to implement these changed clauses.

This leaves at least three possibilities:

• Because the overhaul materials are not clearly drafted, one reading is that all of the rest of FAR Part 52 is to be removed to a “Buying Guide.” This would be enormously disruptive, for the reasons outlined above.
• Alternatively – and more likely – the overhaul of FAR Part 52’s standard clauses may continue to unfold as other parts of the FAR (and their accompanying clauses) are revised.
• Finally – and least likely – it is possible that no other standard clauses will be touched by the FAR overhaul.

Conclusion

The Trump administration’s “revolutionary overhaul” of the FAR has begun. Perhaps because of the short time allowed for this complex process, the first handful of proposed changes seem modest, at least on their face. The first proposed changes have clarified the process that the FAR overhaul team will be following, in accordance with President Trump’s executive order and OMB’s direction. The initial overhaul process is to be completed by mid-October, and formal rulemaking to make the changes permanent (with public notice and comment) probably will follow for some time after that. In the meantime, the federal procurement community (see Daniel Ramish’s analysis) is likely to follow these changes closely because of the profound structural importance of the FAR, the centerpiece to the United States’ highly advanced procurement system.