GSA Proposed FAR Class Deviation on EULAs is Good First Step

Blog
May 27, 2015

In an effort to minimize the complexity of incorporating commercial end user license agreements (EULAs) into multiple award schedule contracts, the General Services Administration (GSA) is seeking to create a deviation from the Federal Acquisition Regulation (FAR) that will essentially allow the agency to give greater consideration to commercial terms.

GSA is proposing major changes as to how to handle Commercial Supplier Agreement terms. The GSA’s Office of Acquisition Policy (OAP) published a Federal Register notice March 20 to issue a class deviation to address Commercial Supplier Agreement terms for federal contractors (80 Fed. Reg. 15011). The proposed deviation would request the removal of 15 “points of inconsistency with Federal law that are addressed by this class deviation.” The notice states that the content of any Commercial Supplier Agreement and the final government contract pricing may not be deemed confidential, but that “the Government may retain other marked confidential information as required by law, regulation or agency guidance, but will appropriately guard such confidential information.” These proposed changes will apply to (1) all new commercial supplies and services awards through GSA and (2) existing GSA awards when options are exercised or the contract is modified.

GSA intends to issue the class deviation on May 1, 2015, after considering comments received. After the class deviation is issued, the intent is for GSA and industry not to have to spend significant time and resources resolving these terms and conditions on a case-by-case basis.

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From the initial onset, this effort proposes to –

  • Reduce risk uniformly by addressing common acceptable Commercial Supplier Terms
  • Facilitate efficiency and effectiveness in the contracting process by reducing the administrative burden for government and industry, and
  • Promote competition by reducing barriers to industry, particularly small businesses.

It is quite interesting to witness this effort regarding GSA’s proposal to address Commercial Supplier Terms. Having first-hand experience with the complexity of the entire Commercial Supplier Term/EULA process since it first began several years ago within GSA’s IT70 center, this proposed class deviation is clearly a good start which accurately identifies the typical offensive provisions that are inconsistent with federal law.

This effort also aims to “facilitate efficiency and effectiveness in the contracting process by reducing the administrative burden,” however, each commercial supplier term agreement or EULA is different, so it raises concerns is to how this class deviation supposes to standardize considering the complexity of some of the commercial terms. Furthermore, the class deviation would “implement standard terms and conditions to minimize the need for negotiating the terms of Commercial Supplier Agreements on an individual basis,” and that GSA acquisitions for commercial supplies or services “will be required to incorporate the new terms.”

Commercial terms and conditions vary and are specific to each Original Equipment Manufacturer (OEM). If standard language and/or terms are provided by the government, then would there be risk that the Commercial Supplier Agreement or EULA is no longer commercial in its intent?

Minimizing the delays in this complex process will definitely reduce barriers. Any strides to be made in this area will be most beneficial to both GSA and industry. Many contractors have turned to other government procurement vehicles because of the many challenges faced with the complex Commercial Supplier Agreement/EULA issues at GSA.

To conclude, the proposed class deviation appears to be a good course towards a resolution, however, this is a general approach. How will GSA handle complex Commercial Supplier Agreements to assure compliance with federal law?

For more information on how this change may impact GSA Schedule contracts, contact Hope Lane at 301-231-6266 or hlane@aronsonllc.com