The Independent Counsel

Government Contracts


COTS Contracting


BY JOSEPH VALOF

If your company decides to market commercial products to the U.S. Government, you must become familiar with the federal Commercial Off-The-Shelf ("COTS") and nondevelopment items ("NDI") procurement regulations and contracting processes. The newly adopted "COTS-Spec" has motivated the government to use NDI and commercial grade products wherever possible, thus creating new and significant marketing opportunities for many companies.

Compliance Can Be Burdensome

Compliance with the typical government contract solicitation package of 100-150 clauses is unnecessarily time consuming and costly, especially since most of the clauses do not even apply to a commercial house. Selling through a Government Prime can be even more onerous, as the Prime will attempt to flow down as much of its risk as possible.

The good news is that the federal government has undertaken a reform known as the "800 Panel". A first, beneficial result is DFAR (Defense Federal Acquisition Regulation) Subpart 211-70, entitled "Acquisition and Distribution of Commercial Products." Subpart 211-70 permits a simplified uniform contract format that cuts the number of clauses normally found in a typical procurement solicitation down to approximately 70.

Request This Subpart

In order to employ this simplified COTS contract, a vendor must specifically request Subpart 211-70 in its response to a solicitation, either from the government, or from its Prime, which must in turn request the contract from its contracting officer.

Comment: The government purchasing process remains complex, even with the new COTS format, but the government marketplace offers many opportunities that, if taken advantage of effectively, can add to your company's bottom line.

© ASSOCIATION OF INDEPENDENT GENERAL COUNSEL 1994; (all rights reserved). This article is not intended as legal advice. Consult a qualified attorney for assistance concerning a specific issue or problem.