Simplified Acquisitions: Soliciting Three Local Sources Satisfied Competition Requirements

The Army did not violate the Competition in Contracting Act by soliciting only three local sources for a simplified acquisition to be performed outside of the United States.

In a recent bid protest decision, the GAO explained that under the circumstances, the Army was not required to publish notice of the procurement on the FedBizOpps website, and satisfied the competition requirements by seeking quotations from three local sources.

The GAO’s decision in Latvian Connection General Trading and Construction, LLC, B-409442 (Apr. 25, 2014) involved an Army RFQ for 15-passenger vans to move troops and equipment in the United Arab Emirates.  The Army used simplified acquisition procedures to conduct the acquisition.

On January 23, 2014, the Army provided the RFQ to three local vendors.  After learning of the requirement, Latvian Connection General Trading and Construction, LLC, also expressed interest.  The Army provided Latvian Connection with a copy of the RFQ the following day.  Latvian Connection and the three local vendors all submitted timely quotations.

Latvian Connection then filed a protest with the GAO challenging the RFQ.  Latvian Connection asserted that the agency acted improperly when it did not publish notice of the procurement on the FedBizOpps website, and argued that the Army failed to conduct the procurement using full and open competition as required by the Competition in Contract Act.

The GAO wrote that under FAR 5.202(a)(12), “[o]ne of the specified exceptions to the general requirement to publicize procurements in FAR subpart 5.2 is for a contract action by a defense agency ‘to be made and performed outside the United States and its outlying areas, and only local sources will be solicited.'” 

Addressing Latvin Connection’s competition argument, the GAO stated, “since the agency was using simplified acquisition procedures, it was not required to use full and open competition to conduct the procurement.  Instead, the agency was required to promote competition to the maximum extent practicable.”  The GAO explained, “since the agency was using simplified acquisition procedures, and pursuant to FAR § 5.202(a)(12) was not required to publish notice on the FedBizOpps website, soliciting three sources meets the FAR’s requirements for conducting a simplified acquisition.”  The GAO cited FAR 13.104(b), which states:

If using simplified acquisition procedures and not providing access to the notice of proposed contract action and solicitation information through the Governmentwide point of entry (GPE), maximum practicable competition ordinarily can be obtained by soliciting quotations or offers from sources within the local trade area. Unless the contract action requires synopsis pursuant to 5.101 and an exception under 5.202  is not applicable, consider solicitation of at least three sources to promote competition to the maximum extent practicable. Whenever practicable, request quotations or offers from two sources not included in the previous solicitation.

The GAO denied the protest.

The Latvian Connection protest is a good reminder that exceptions exist to the ordinary rules regarding FedBizOpps publication and full competition.  While agencies may sometimes unfairly limit competition, in other cases, actions that may appear anti-competitive are permitted under the law.

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