Insights

On August 25, 2025, the Department of Defense (DoD) issued the Final Rule implementing Section 812 of the National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2024 (P.L. 118-31).  The Final Rule will take effect on October 24, 2025 via a new solicitation provision, DFARS 252.209-7012 (Prohibition Relating to Conflicts of Interest in Consulting Services – Certification).

Government contractors face a growing range of antitrust concerns that are unique to the industry—from how the FTC, DOJ, and DOD analyze defense mergers, to managing information sharing in prime/sub relationships, to navigating antitrust investigations involving classified information. Join us over the coming months for a new series on contractors and competition, where we will explore best practices for in-house counsel and procurement teams to reduce risk in this complex area.

On June 23, 2025, the DoD issued a memorandum, “Implementation of Department of Government Efficiency Cost Efficiency Initiative,” to establish a new DOGE approval process for unclassified IT consulting and management services (ITC&MS) contracts or task orders (TOs), and advisory and assistance services (A&AS) contracts or TOs.  The memorandum establishes a formal approval process, which directs DOGE to review and provide input for certain contract requirement packages included in Defense Secretary Pete Hegseth’s May 27, 2025 directive, “Implementation of Executive Order 14222 – Department of Government Efficiency Cost Efficiency Initiative” (“Contract Guidance”). 

Underscoring the Administration’s intention to eradicate DEI preferences and mandates, the Department of Justice (DOJ) launched a new Civil Rights Fraud Initiative (Initiative) to be co-led by DOJ’s Civil Rights Division and Fraud Section. In response, Crowell launched its own DEI and Civil Fraud Initiative to support clients in managing the heightened risks associated with this new enforcement landscape.

On May 2, 2025, the Office of Federal Procurement Policy (“OFPP”) and the Federal Acquisition Regulatory Council (“FAR Council”) issued the first round of promised FAR rewrites—to Parts 1, 34, and 52—alongside a guidance memorandum for agencies subject to the FAR, Deviation Guidance to Support the Overhaul of the Federal Acquisition Regulation (“FAR Council Deviation Guidance”). The Office of Management and Budget also released a guidance memo, Overhauling the Federal Acquisition Regulation (“OMB Guidance”), that addresses the proposed implementation roadmap for the FAR overhaul. These initial FAR revisions follow the April 15, 2025 Executive Order (“EO”), Restoring Common Sense to Federal Procurement, which we previously reported on here.

Late on Friday, a federal judge in Maryland issued a preliminary injunction pausing certain elements of the Trump Administration’s two recent executive orders (“EOs”) addressing “illegal DEI programs.” The two EOs, Exec. Order 14151, Ending Radical and Wasteful Government DEI Programs and Preferencing (the “J20 Order”) and Exec. Order 14173, Ending Illegal Discrimination and Restoring Merit-Based Opportunity (“J21 Order”), contain a number of provisions that, among other things, direct the federal government to dismantle “illegal DEI programs” within federal agencies and federal contractors. Please refer to our prior alert on these EOs for a full breakdown of the provisions in each.

On January 20, 2025, the White House issued an Executive Order (EO) that revoked 78 executive orders and presidential memorandums issued by President Biden between January 21, 2021 and January 19, 2025 that do not align with Trump Administration policies.  Of those revoked by the EO, several impact government contracts and federal procurement, including, but not limited to:

Among the flurry of executive actions taken during his first day in office, President Trump formally established the U.S. Department of Government Efficiency Service (DOGE) via executive order (EO) on January 20, 2025, reconstituting the formerly named U.S. Digital Service that was created in 2014 by President Obama within the Office of Management and Budget. 

Late on the night of January 21, 2025, President Trump signed the “Ending Illegal Discrimination And Restoring Merit-Based Opportunity” Executive Order (the “EO”). This EO, like a number of the executive orders issued on his first day in office, took aim at Diversity, Equity, and Inclusion (“DEI”) programs by, among other things, broadly directing executive agencies and departments to terminate all “discriminatory and illegal preferences, mandates, policies, programs, activities, guidance, regulations, enforcement actions, consent orders, and requirements;” curtailing the Office of Federal Contract Compliance Programs’ (OFCCP) operational authority and directing agencies to scrutinize the DEI practices of private sector employers. Additionally, this language raises questions about the future and status of certain programs, preferences, and set-aside procurements administered by the U.S. Small Business Administration, U.S. Department of Transportation, and other agencies. 

On January 15, 2025, the Federal Acquisition Regulatory Council issued a Proposed Rule that would implement changes to the Federal Acquisition Regulation (FAR) Organizational Conflict of Interest (OCI) rules as required by the 2022 Preventing Organizational Conflicts of Interest in Federal Acquisition Act (P.L. 117-324).  Comments on the Proposed Rule are due on March 17, 2025.  (Note that pursuant to President Trump’s January 20, 2025 “Regulatory Freeze Pending Review” Executive Order, the Proposed Rule is subject to further review, which may result in revisions and an extension of the 60-day comment period.)

As Crowell covered in a recent alert, the Department of Defense (DoD) on October 11, 2024 released a final rule (the “Final Program Rule”) formalizing the requirements, assessment processes, and related governance for its Cyber Maturity Model Certification Program (CMMC).

The federal government’s response to Hurricanes Helene and Milton will increase its reliance upon government contractor support to perform critical tasks in the coming months.  The Federal Emergency Management Agency and other federal, state, and local agencies charged with disaster response and recovery will look to contractors to provide everything from logistics to housing, construction, and security services.  National disaster contracting provides contractors with immediate opportunities to assist in the recovery effort, but given the time sensitivity, evolving customer needs, and critical nature of the work, contractors must be prepared to: (i) perform under tight deadlines and high scrutiny; (ii) seek clarity with respect to the scope of work they are asked to perform; (iii) properly manage contract and change order documentation; and (iv) maintain contract files for subsequent audits and other inquiries which can take place years after the recovery effort has ended.  One of the most common contract risks associated with disaster response efforts is the inevitable “scope creep” as contractors encounter ever-changing events on the ground, which puts an emphasis on record keeping and timely communications with government customers, to ensure payment for work performed.

On Monday, September 23, 2024, the Department of Justice (DOJ), released an update to its Evaluation of Corporate Compliance Programs (ECCP) guidance.  The ECCP guidance was last revised in March 2023, which brought a number of significant changes, including a focus on compensation and incentive structures (e.g., clawbacks), and third party messaging applications.  This 2024 update, while not as significant in scope as its predecessor, nonetheless highlights the DOJ’s focus on new and emerging technologies, such as artificial intelligence (AI), as part of its evolving assessment of what makes a corporate compliance program truly effective, and how prosecutors should evaluate risk assessments and other management tools at the time of a corporate resolution.

On June 24, 2024, the U.S. District Court for the Northern District of Texas issued a nationwide preliminary injunction, stopping the U.S. Department of Labor (“DOL”) from enforcing three key elements of regulations related to the Davis-Bacon Act and Related Acts (“DBA” or “Act”).  The court order issued in Associated General Contractors v. U.S. Department of Labor will provide significant comfort and certainty to contractors that perform work on federally funded construction projects.

On May 30, 2024, the Department of Defense (DoD) issued a final rule amending the Defense Federal Acquisition Regulation Supplement (DFARS) to implement Section 803 of the 2023 National Defense Authorization Act, which modified 10 U.S.C. § 3455 to provide additional guidance regarding data requirements needed to support determinations of commerciality and price reasonableness under procurements for major weapon systems.  The rule applies to products that (i) have not previously been deemed commercial by the DoD; and (ii) are proposed as either a subsystem of a major weapon system or as a component or spare part of a major weapon system or subsystem. 

Following a January 29, 2024 White House announcement and Fact Sheet, on January 30, 2024, the Federal Acquisition Regulation (FAR) Council issued a Notice of Proposed Rulemaking (Proposed Rule) on salary-history bans and pay transparency for applicants and employees of federal contractors and subcontractors. On the same day, the Office of Federal Contract Compliance Programs (OFCCP) issued some FAQs on the compensation history issue. These actions by the federal government to ban prior salary information and require compensation information in job postings echo the efforts of multiple states and municipal governments that have enacted similar salary history bans and/or compensation disclosure requirements:

On January 11, 2024, the Department of Defense (DoD) announced its first-ever National Defense Industrial Strategy (NDIS) focused on building a modernized industrial ecosystem that provides a sustained competitive advantage to the US over its adversaries.  Specifically, the NDIS provides a strategic framework to guide the DoD’s engagement, policy development, and investment in the industrial base over the next three to five years.  As part of this investment strategy, the NDIS highlights several investment tools and opportunities that DoD is already using to spur growth and innovation in key industries.

On January 9, 2024, the FAR Council issued a proposed rule, seeking to amend the Federal Acquisition Regulation (FAR) in order to enhance consistency and alignment between the suspension and debarment procedures in the FAR and in the Nonprocurement Common Rule (NCR) system (contained in 2 CFR Part 180).  The FAR and NCR are two separate suspension and debarment regulatory regimes, with the former governing procurement matters and the latter governing grants, cooperative agreements, contracts of assistance, and loan guarantees.  While these suspension and debarment regimes are similar, the proposed rule would remove some differences—definitional and procedural—between the FAR and NCR.  

The Department of Defense recently issued a long-awaited final rule prohibiting DoD prime contractors from “flowing down” FAR and DFARS clauses in subcontracts for commercial products or services, unless flowdown is specified by regulation. This rule implements language, dating from the 2017 National Defense Authorization Act, intended to reduce administrative burdens on DoD contractors and subcontractors by adding a prohibition on extraneous flowdowns at DFARS 252.244-7000 Subcontracts for Commercial Products or Commercial Services.

On November 8, 2023, the Biden-Harris Administration announced the Better Contracting Initiative (BCI), a four-pronged initiative to ensure that the federal government is getting the best terms and prices when purchasing goods and services.  The federal government purchases billions of dollars’ worth of goods and services each year; however, the Administration is concerned that agencies pay inconsistent prices and often more than market price.  The BCI strategy is to improve how federal agencies procure innovative technologies and leverage data to make smart buying decisions by utilizing the following four steps as detailed below.