Author: Christopher Yukins

The Trump administration’s “Revolutionary FAR Overhaul” (RFO) initiative has released its second tranche of proposed changes to the Federal Acquisition Regulation (FAR), this time to FAR Part 10, Market Research. The proposed changes are again generally relatively modest, perhaps because the existing FAR Part 10 was already very short.  

What the latest changes do help clarify is how the FAR overhaul will proceed from here. The latest round of changes emphasizes training for the acquisition workforce on the overhauled parts of the FAR, and makes that training interesting and accessible.

But the latest round (and the implementing agencies’ follow-up to the prior round) also confirm how these sudden changes to the FAR will be implemented until formal rulemaking can begin, likely in October 2025: the participating agencies probably will issue class deviations adopting the “model” deviations — the stopgap changes — which have been approved by the FAR Council. As the discussion below explains, this leaves open questions over whether the “revolutionary” overhaul is bypassing the normal publication and comment required by law for changes to the FAR.

Editor’s note: For background on the “Revolutionary FAR overhaul” published in conjunction with the first tranche of changes (to FAR Parts 1 and 34), please click the image below.

FAR Part 10: Market Research – Proposed Changes

Current FAR Part 10 explains how market research should be performed. The current FAR language largely follow mandates from other statutes and regulations: per statutory requirements, for example, FAR Part 10 encourages agencies to do research to enable the use of commercial products, and per title 15, U.S. Code, FAR Part 10 directs agencies to do research so that they can purchase from small businesses where possible. These provisions largely replicate parallel requirements in FAR Parts 7 and 19, and so were deleted in the proposed overhaul.

The proposed new streamlined version of FAR Part 10 shifts much of the direction and encouragement to an informal “Practitioner Album” — a slick, well-designed series of lessons on new approaches to market research, including links to automated tools and resources. The overhaul also promises a future “FAR Companion Guide” which is to include guidance removed from the FAR itself, and which is to afford “acquisition teams greater flexibility and discretion to consider techniques which are most appropriate to their acquisition.”

Emerging Issues with Class Deviations

Potentially more controversial are the class deviations that are being used to implement the FAR overhaul, pending a formal rulemaking process. Without publication or allowing for public comment, the FAR Council has approved class deviations to implement the FAR “overhaul,” class deviations which have simply been adopted by individual agencies (listed in the table below). Direction issued on May 2, 2025 by the FAR Council strongly encouraged the agencies to simply adopt the “model” class deviations prepared by the FAR Council.

Kara Sacilotto, a partner at the Wiley law firm, has published an outstanding overview of the FAR overhaul initiative through Thomson Reuters’ Briefing Papers. Her firm is tracking the FAR Overhaul changes at their “Decoding the FAR Rewrite” page

These class deviations implement the “overhaul” pending a more formal rulemaking process that is to begin once the initial phase of the “overhaul” is complete, probably in October 2025.

Both the first tranche (to FAR Parts 1 and 34) and the second tranche (FAR Part 10) of “revolutionary overhaul” changes have been adopted through class deviations by the same group of civilian agencies (see table below) – as of this writing, no unit of the Defense Department has put a class deviation in place to implement the overhaul.

None of these class deviations has included an explanation for why the class deviation at issue was being adopted, other than to note that the FAR Council had approved the model deviation. None of the deviations has explained why they were “necessary to meet [the issuing] agency’s specific needs.” FAR 1.302(a). Nor were any of these class deviations published in the Federal Register.

The class deviations may draw a challenge in court, for example for the agencies’ failure to publish the class deviations in the Federal Register for public comment. In La Gloria Oil & Gas Co. v. United States, 56 Fed. Cl. 211, 220 (2003), abrogated on other grounds by Tesoro Hawaii Corp. v. United States, 405 F.3d 1339, 1349 (Fed. Cir. 2005), Judge Hewitt of the Court of Federal Claims explained that Section 22 of the Office of Federal Procurement Policy Act (now codified at 41 U.S.C. § 1707) requires that an agency publish in the Federal Register proposed changes in “procurement policy, regulation, procedure or form” – including, the court said, the class deviations at issue in that case. See 41 U.S.C. § 1707(a) (“a procurement policy, regulation, procedure, or form (including an amendment or modification thereto) may not take effect until 60 days after it is published for public comment in the Federal Register pursuant to subsection (b) if it— (A) relates to the expenditure of appropriated funds; and (B) (i) has a significant effect beyond the internal operating procedures of the agency issuing the policy, regulation, procedure, or form; or (ii) has a significant cost or administrative impact on contractors or offerors.”); FAR 1.301(b) (“Agency heads shall establish procedures to ensure that agency acquisition regulations are published for comment in the Federal Register . . . as required by 41 U.S.C. 1707, and other applicable statutes, when they have a significant effect beyond the internal operating procedures of the agency or have a significant cost or administrative impact on contractors or offerors.”); see also Sunoco, Inc. v. United States, 59 Fed. Cl. 390, 396 (2004) (class deviation must be published to notify “the public of an immediate and nonpermanent change to the particular regulation”), abrogated on other grounds by Tesoro Hawaii Corp., 405 F.3d at 1349 (Fed. Cir. 2005); Navajo Ref. Co., L.P. v. United States, 58 Fed. Cl. 200, 209 (2003) (although “section 22 of the OFFP Act does not specifically address class deviations, the court finds that a class deviation may fall within any of the various categories of procurement changes identified in the OFFP Act — in particular, changes in procurement policy, regulation, procedure or form — that require publication in the Federal Register under the OFFP Act).

A challenging party may argue that, without publication and an opportunity to comment, affected parties may not have a meaningful opportunity to challenge the class deviations as “precluded by law.” See, e.g., Serv. Emps. Int’l Union, AFL-CIO v. Gen. Servs. Admin., 830 F. Supp. 5, 10 & n.4 (D.D.C. 1993). A challenging party may argue that the class deviations, because issued in violation of publication and other requirements, are therefore invalid and without force. See Aerolease Long Beach v. United States, 31 Fed. Cl. 342, 367, aff’d, 39 F.3d 1198 (Fed. Cir. 1994).

Under FAR 1.301, no publication in the Federal Register would be “required for issuances that merely implement or supplement higher level issuances that have previously undergone the public comment process” – but no public comment process has occurred here, and so that exception from publication would not apply.

It is possible that no Defense Department units have adopted the class deviations because of more stringent requirements under the DoD rules. Defense Federal Acquisition Regulation Supplement (DFARS) 201.402 says that a request for a deviation must include a “detailed rationale for the request,” including a statement of “what problem or situation will be avoided, corrected, or improved if request is approved.” That rationale under the DoD rules would have to explain, as noted, why the DoD class deviation was “necessary to meet [the issuing] agency’s specific needs,” FAR 1.302(a) (emphasis added) – which could be difficult, because the class deviations are clearly being issued to meet a governmentwide goal of streamlining the FAR. Cf. Serv. Emps. Int’l Union, AFL-CIO v. Gen. Servs. Admin., 830 F. Supp. 5, 10 (D.D.C. 1993) (finding agency-specific deviating regulation unlawful under the Administrative Procedure Act (APA) because it was a general cost-cutting measure, and was “not designed to ‘satisfy the specific need of the agency,’” and nothing in the administrative record showed “how this need for cost savings [was] specific or unique to” the issuing agency).  

Conclusion

The second round of changes under the “Revolutionary FAR Overhaul,” to FAR Part 10 (Market Research), was not in fact enormously revolutionary. These latest changes do, though, deepen possible concerns about how the overhaul initiative is being undertaken: the FAR Council is simply approving model class deviations, which are in turn being adopted by agencies without the publication and public comment normally required by law for class deviations. This approach has not been terribly controversial so far because the regulations that have been “overhauled” — FAR Parts 1, 10 and 34 — are relatively obscure. The means being used to undertake this “revolutionary FAR overhaul” may, however, prove more controversial as the initiative moves on to more critical parts of the Federal Acquisition Regulation.

On April 9, 2025 President Trump issued an executive order on Department of Defense (DoD) acquisition, “Modernizing Defense Acquisitions and Spurring Innovation in the Defense Industrial Base.”

While the executive order recognized the importance of the defense acquisition workforce, the order also called for the Defense Department to “right-size” that workforce. The order called for streamlined procurement methods, for example under FAR Part 12 (commercial goods and services) and Other Transactions Authority. Finally, the order called for reviews of major weapon systems and processes, to cull overdue and over-budget systems and to reform the processes used to purchase major systems.

Introduction

The executive order called for enhancements in Defense Department procurement and in the defense acquisition workforce, which the President termed “a national strategic asset that will be decisive in any conflict.” The order called on the Department to “modernize the duties and composition of the defense acquisition workforce,” and to “incentivize and reward risk-taking and innovation from these personnel.” The order also called for accelerating defense procurement and revitalizing the defense industrial base.

For updates on Administration actions which affect procurement, see the GW Law “tracker“

Acquisition Process Reform

The order called for a plan from the Department of Defense, within 60 days, to reform the Department’s acquisition processes, including:

• Use of existing authorities to expedite acquisitions, including (1) giving a first preference to commercial solutions (including commercial products and services under FAR Part 12 and DFARS 212.2, commercial solutions opening (DFARS 212.70), and “other industry solutions funded by private investment”); (2) giving a general preference to Other Transactions Authority, Rapid Capabilities Offices’ policies (Air Force, Space Force, Army, Marines, Navy) “or any other authorities or pathways to promote streamlined acquisitions under the [Adaptive] Acquisition Framework.” In his memorandum of March 6, 2025 on software acquisition reform, Secretary of Defense Hegseth called for similar approaches when the Defense Department purchases software.
• While the plan is being formulated the DoD is to prioritize use of these authorities in all pending Department of Defense contracting actions and, where appropriate and lawful, require their application. (See chart below comparing Commercial Solutions Opening vs. Other Transactions Authority.) In the bill that he introduced in the last days of the prior Congress, S. 5618, the FoRGED Act (Fostering Reform and Government Efficiency in Defense), and in his accompanying report (Restoring Freedom’s Forge), now-Chairman of the Senate Armed Services Committee Roger Wicker called for a similar emphasis on commercial solutions and streamlined acquisition methods. In many ways, this executive order aligned the Trump administration with Senator Wicker’s agenda for reform. More broadly, these efforts parallel efforts in the European Union to encourage “procurement for innovation,” though in the EU the focus is on civilian acquisition, not defense.
• A detailed review of the acquisition process and personnel to eliminate unnecessary or redundant tasks and approvals, and to centralize decision-making.
• Developing a process by which the Under Secretary of Defense for Acquisition and Sustainment, Service Acquisition Executives, and Component Acquisition Executives can manage risk for all acquisition programs through the Configuration Steering Board, a formal steering board which would undertake an annual review of potential requirements changes, critical intelligence parameter changes, and any significant technical configuration changes per Department of Defense Instruction 5000.85.
• Undertaking a review to streamline DoD regulations and guidance and to promote faster acquisition (with any new regulations or guidance subject to the ten-for-one rule which requires ten deleted regulations for every new one, per EO 14192, “Unleashing Prosperity Through Deregulation” (Jan. 31, 2025)).

Acquisition Workforce Reform

Within 120 days, the Defense Department is to submit a plan to “reform, right-size, and train the acquisition workforce.” The plan is to include performance metrics to encourage acquisition officials to give first consideration to commercial solutions (defined above). The plan is also to review appropriate staffing levels. The plan is to establish “field training teams,” led by senior managers, to train on innovative acquisition authorities and commercial solutions. Finally, the plan is to produce policies and procedures to incentivize acquisition officials to use innovative acquisition authorities and to “take measured and calculated risks.” Senator Wicker’s “Restoring Freedom’s Forge” report (see above) called for similar reforms to the Defense Department’s procurement structure.

Major Reviews

Under the executive order, the Defense Department is to undertake a comprehensive review of all major defense acquisition programs (MDAPs), to identify those over budget, behind schedule or inconsistent with current policy — and those will be considered for cancellation. After the MDAP review, the Defense Department is to review other major systems. Finally, the Department is to review the Joint Capabilities Integration and Development System “with the goal of streamlining and accelerating acquisition.”

Editor’s Note: This summary was prepared for the Procurement Reform seminar taught as part of George Washington University Law School’s Government Procurement Law Program.

In response to President Trump’s threats to impose severe, across-the-board tariffs on goods from the European Union (EU), EU policymakers have warned that the EU may respond by deploying its “trade bazooka,” the EU Anti-Coercion Instrument. This could have an important impact on U.S. vendors in EU public procurement markets.

The EU Anti-Coercion Instrument is an EU regulation, formally Regulation (EU) 2023/2675 of the European Parliament and of the Council of 22 November 2023 on the protection of the Union and its Member States from economic coercion by third countries, which provides the EU with a range of remedies to deploy in the face of international trade “coercion.”

The European Commission describes the Anti-Coercion Instrument “first and foremost” as “a deterrent against economic coercion.” Where “coercion” occurs, the tool provides EU policymakers with a “structure to respond in a well-calibrated way to stop the coercion,” through a “a wide range of possible countermeasures when a country refuses to remove the coercion.” Besides tariffs, those counter-measures can include “restrictions on access to . . . public procurement.” The Anti-Coercion Instrument “provides a legal framework for responding to coercion and sets down the means for the EU to investigate and take decisions.” It includes timeframes and procedures for stakeholders to work with the Commission before the EU launches countermeasures, and “provides a framework for the EU to request a third country to repair the injury caused by its economic coercion.”

Under the Anti-Coercion Instrument, “economic coercion” occurs when another country “applies or threatens to apply a . . . measure affecting trade or investment” in order stop or curb an action by the EU or a Member State, “thereby interfering in the legitimate sovereign choices of the Union or a Member State.” Before deploying the Instrument, the EU is to take into account the “intensity, severity, frequency, duration, breadth and magnitude” of the other nation’s measures, whether the other nation “is engaging in a pattern of interference seeking to prevent or obtain particular acts” from the EU, its Member States or another nation, whether the “coercive” nation’s measures encroach “upon an area of the Union’s or a Member State’s sovereignty,” and whether the “coercive” nation has failed to make good-faith efforts to resolve the matter. European leaders and economists have argued that the Trump administration’s attacks against the EU meet all of those triggers.

The Anti-Coercion Instrument includes, in Annex I, potential countermeasures which would impact public procurement. Those countermeasures could be deployed despite potential violations of “applicable international obligations concerning the right to participate in tender procedures in the area of public procurement” — in other words, even if by taking those measures the EU risked violating the World Trade Organization (WTO) Government Procurement Agreement, which opens the EU and U.S. public procurement markets. (The Anti-Coercion Instrument does not explicitly address the bilateral reciprocal defense procurement agreements which are vital to open defense markets between the United States and its NATO allies.)

The Anti-Coercion Instrument says that, with regard to public procurement, “goods, services or suppliers” from a targeted “coercive” nation can be excluded from public procurements in the European Union. Alternatively, bids (tenders) that include goods or services from “coercive” nations can also be excluded, or the scoring evaluation of those bids can be adjusted.

If the EU deploys the Anti-Coercion Instrument against U.S.-based vendors, goods and services in EU Member State procurements, the consequences could be severe. European Commission data show that U.S. vendors, goods and services enjoy a substantial share of the EU public procurement markets, directly and indirectly. The coming weeks will be critical as the EU decides whether to use the Anti-Coercion Instrument to respond aggressively to perceived “coercion” from the Trump administration.

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