Government Contracts Brief – Week of March 16, 2020

Corrective Action And Timeliness In GAO Protests

GAO recently denied a protest as untimely related to an agency’s corrective action. The unsuccessful offeror filed a protest, which was denied as academic due to the agency taking corrective action. The agency made the scope of the corrective action clear to the protestor. The corrective action notice date was September 30. When the agency implemented its corrective action and the protestor again did not receive the contract, which was awarded on October 19, it filed a second protest on October 31. GAO dismissed the second protest as untimely based on its precedent that protests based on the scope of corrective action are “analogous to a challenge to the terms of a solicitation and also must be filed prior to the deadline for submitting revised proposals.” So, the lesson for a contractor is if it has concerns about the scope of an agency’s corrective action, do not wait until the outcome of the re-compete to file a protest. CPS Professional Services, LLC d/b/a CATHEXIS, B-417928.2, February 5, 2020.

ITAR and EAR Overview

As many contractors know exporting defense articles and related technical data and software is highly regulated requiring a license for such in many but not all instances. The International Traffic in Arms Regulations (ITAR) and Export Administration Regulations (EAR) govern the export and licensing of these items. The Department of State has jurisdiction over ITAR controlled items while the Bureau of Industry and Security of the Department of Commerce is the agency responsible for EAR administration, compliance, and enforcement. Which agency has jurisdiction over the item depends on whether its classification falls under the U.S. Munitions List in the ITAR or the Commerce Control List in the EAR.

Non-Payment Does Not Excuse Performance

Generally, if the government fails to pay a contractor’s invoices, the contractor may not stop performance under the contract because of such. An ASBCA decision in favor of the government on this subject reminds us the government’s nonpayment does not excuse the contractor’s nonperformance unless, for example, the nonpayment puts the contractor in a financial position of not being able to perform. The net-net is that if the government does not pay your invoices but you can still perform, you should do so to avoid being terminated for default. Appeal of Puma Energy Honduras, S.A. de C.V., ASBCA No. 61966.

 

Attorney Kristi Morgan AronicaOur government contracts briefs, reports, and articles are published by Attorney Kristi Morgan Aronica. She serves as counsel to government contractors and subcontractors throughout Texas and nationally.