Contracting for goods and services is a way of life for businesses. When a contract is issued for goods or services to be used under a government prime contract, it becomes a subcontract.
As a subcontract, the transaction becomes subject to additional requirements imposed on the prime contract by Federal Law as translated by the body of Federal Acquisition Regulations and Agency Supplements. While there is no direct relationship between the subcontractor and the Government, the use of “flowdown” clauses from the prime contract causes certain control by the Government over the subcontractor.
These additional requirements cover all aspects of the contractual relationship including the decision to buy, selection of the supplier, pricing the contract, terms of the contract, quality, payments and even completion and closeout.
How you approach subcontracting (prime or sub) and how you resolve issues that arise during performance depends not only on what you are – a seller or a buyer; industry representative or Government official; contract administrator or lawyer – but also on what you know and how well you understand the unique demands of the subcontract process. With knowledge, you can guide the process with minimum problems.
The focus of this program is on effective management and administration of subcontracts and complex purchase orders. The benefits of attendance will extend across the full life phase of the subcontract – from the presoliciation phase to final payment. Topics covered will provide guidance on development and management including:
• Finding suppliers and competition • Teaming agreements and data rights • Make of buy issues • Effective flow down of prime clauses • Tailoring terms and conditions • Impact of the Uniform Commercial Code • Hierarchy of clauses • Managing project risks • Type of contract/subcontract • Acceptance and payment • Commercial item subcontracts • Inter company transactions • Organization and role of subcontracts/purchasing • Socioeconomic requirements • Representations and certifications
1. ORGANIZATION FOR EFFECTIVE SUBCONTRACTS MANAGEMENT a. The Acquisition Team b. Roles and Responsibilities c. Subcontract or Purchase Orders? d. Matrix Management
2. SUBCONTRACT MANAGEMENT SYSTEM a. Development of the Requirement b. Contract or Proposal c. Authorization for Purchase d. Formal Source Selection/Bid e. Validity of Proposals
3. THE STATEMENT OF WORK a. Development b. Content c. Clarity d. Offerors e. Deliverables 4. SUBCONTRACT INFORMATION a. Requirements for Valid Contracts b. Government Approval c. What Constitutes Agreement d. Privity
5. APPLICABLE LAWS AND REGULATIONS a. State Law as Applicable b. Federal Laws and Regulations c. Federal Acquisition Regulation d. Federal Agency Supplements e. Uniform Commercial Code 6. UNIFORM COMMERCIAL CODE a. Applicability to Subcontract b. Gap Filler c. Battle of the Forms d. Informality e. Offers f. Acceptance
7. SUBCONTRACTS FLOWDOWNS a. Requirements b. Type of Prime Contracts c. Type of Subcontracts d. Mandatory v. Optional v. Desired e. Reference or Full Text f. Custom or Modified g. Representations and Certifications
8. HIERARCHY OF TERMS AND CONDITIONS a. General Terms and Conditions b. Prime Contract Flowdowns c. Special Contract Terms d. Special Program Terms e. Special Company Terms
9. CONSIDERATIONS FOR FLOWING DOWN PRIME CLAUSES a. Type of Prime Contract b. Type of Subcontract c. Method of Contract/Subcontract Award d. Subject Matter of Subcontract e. Dollar Value of Subcontract 10. SPECIAL TOPICS/ISSUES a. Socioeconomic Programs b. Cost or Pricing Data c. Commercial Item Purchases d. Quality/Inspection/Acceptance e. Changes/Claims f. Data Rights g. Termination/Breach h. Teaming Agreements i. Options
