Federal Acquisition Regulation: Reverse Auction Guidance, 78815-78820 [2020-24936]

Agencies

• DEPARTMENT OF DEFENSE
• General Services Administration
• National Aeronautics and Space Administration

[Federal Register Volume 85, Number 235 (Monday, December 7, 2020)]
[Proposed Rules]
[Pages 78815-78820]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-24936]


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DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Parts 2, 3, 7, 13, 15, 17, and 52

[FAR Case 2015-038, Docket No. 2015-0038, Sequence No. 1]
RIN 9000-AN31


Federal Acquisition Regulation: Reverse Auction Guidance

AGENCY: Department of Defense (DoD), General Services Administration 
(GSA), and National Aeronautics and Space Administration (NASA).

ACTION: Proposed rule.

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SUMMARY: DoD, GSA, and NASA are proposing to amend the Federal 
Acquisition Regulation (FAR) to provide guidance on the use of reverse 
auctions.

DATES: Interested parties should submit comments to the Regulatory 
Secretariat at one of the addresses shown below on or before February 
5, 2021 to be considered in the formulation of a final rule.

ADDRESSES: Submit comments in response to FAR case 2015-038 to https://www.regulations.gov. Submit comments via the Federal eRulemaking portal 
by entering ``FAR Case 2015-038''. Select the link ``Comment Now'' that 
corresponds with ``FAR Case 2015-038.'' Follow the instructions 
provided on the screen. Please include your name, company name (if 
any), and ``FAR Case 2015-038'' on your attached document. If your 
comment cannot be submitted using https://www.regulations.gov, call or 
email the points of contact in the FOR FURTHER INFORMATION CONTACT 
section of this document for alternate instructions.
    Instructions: Please submit comments only and cite ``FAR case 2015-
038'' in all correspondence related to this case. All comments received 
will be posted without change to https://www.regulations.gov, including 
any personal and/or business confidential information provided. To 
confirm receipt of your comment(s), please check https://www.regulations.gov, approximately two-to-three days after submission 
to verify posting.

FOR FURTHER INFORMATION CONTACT: For clarification of content, contact 
Mr. Curtis E. Glover, Sr., Procurement Analyst, at 202-501-1448. For 
information pertaining to status or publication schedules, contact the 
Regulatory Secretariat at 202-501-4755. Please cite ``FAR Case 2015-
038.''

SUPPLEMENTARY INFORMATION:

I. Background

    DoD, GSA, and NASA are proposing to revise the FAR in response to 
Government Accountability Office (GAO) report, GAO-14-108, Reverse 
Auctions: Guidance is Needed to Maximize Competition and Achieve Cost 
Savings, dated December 2013, and GAO report 18-446, Reverse Actions: 
Additional Guidance Could Help Increase Benefits and Reduce Fees, dated 
July 2018. Reverse auctions are a tool utilized by Federal agencies to 
obtain competitive pricing for an acquisition. Some of the potential 
benefits of reverse auctions include increased competition, price 
reductions, and greater small business participation. During a reverse 
auction, multiple vendors compete with one another to win a contract 
from the Government by lowering the offered price for which the vendor 
is willing to sell a particular product or service. The offered 
price(s), but not the offerors' identity, may be revealed to all 
offerors during the auction, and offerors have the opportunity to 
submit lower priced offers during the auction.

[[Page 78816]]

    The use of reverse auctions to obtain competitive pricing is not a 
new concept to the Government or industry. The reverse auction model 
was introduced in the mid-1990s. Many private companies now offer 
software and/or services to facilitate reverse auctions, as well as use 
reverse auctions in their own supply chain management scheme. In 1997, 
the FAR was also amended to permit the use of reverse auctions in 
Federal acquisitions. Since then, Federal agencies have been able to 
use reverse auctions to obtain pricing, while operating within the 
constructs of the FAR and any supplemental agency guidance. As a 
result, this rule intends to implement Governmentwide policy and 
guidance on reverse auctions to ensure a standardized and consistent 
use amongst all Federal agencies.
    Between its 2013 and 2018 reports, GAO reviewed Federal agencies' 
use of reverse auctions over almost a decade (between 2008 and 2017). 
Six agencies were identified as the largest users of reverse auctions, 
conducting approximately 15,000 reverse auctions in 2016. Through its 
review of the contract awards that resulted from these agencies' use of 
reverse auctions, GAO found that: Reverse auctions are generally used 
when acquiring commercial products; reverse auctions predominately 
result in the award of a fixed price contract valued less than $150,000 
to a small business; the total annual value of contracts that utilize 
reverse auctions regularly represents less than one percent of all 
annual Government contract spending; and most used the services of a 
commercial reverse auction service provider.
    GAO reviewed and analyzed various aspects of agencies' use of 
reverse auctions. GAO found that: Confusion exists concerning a lack of 
documentation about reverse auction service provider fees and their 
application to Federal contracts; there is a lack of sufficient data 
available for agencies to verify actual cost savings resulting from a 
reverse auction; the potential benefits of reverse auctions are not 
being maximized, as many reverse auctions are resulting in the receipt 
of only one offer or a lack of interactive competition amongst offerors 
(i.e., the submission of more than one offer by a vendor); and when 
reverse auctions are used in the acquisition of items from preexisting 
contracts, agencies need to consider the impact of potentially paying 
two fees, one to use the contract and one to use the services of the 
reverse auction service provider, when determining whether the use of a 
reverse auction is cost effective, in comparison to other methods that 
are available to obtain pricing for an acquisition.
    As a result of its findings in 2013, GAO recommended that the 
Director of the Office of Management and Budget amend the FAR to 
address agencies' use of reverse auctions and issue Governmentwide 
guidance to maximize competition and savings when using reverse 
auctions. In response, the Office of Federal Procurement Policy issued 
a memorandum on June 1, 2015, entitled Effective Use of Reverse 
Auctions. This proposed rule implements the policy of the OFPP memo and 
addresses some of the concerns in the GAO reports.

II. Discussion and Analysis

A. New Subpart 17.8 and Associated Provision and Clauses

    Amendments to the FAR are proposed by this rule. To address GAO 
recommendations, a new FAR subpart 17.8, Reverse Auctions, is added. 
This new subpart:
     Provides Governmentwide policy on: When the use of reverse 
auctions may be appropriate, conducting reverse auctions, and utilizing 
reverse auction service providers, including the evaluation of fees;
     Identifies when reverse auctions shall not be used;
     Requires contracting officers to evaluate and document 
that the use of a reverse auction service provider is cost effective;
     Requires agency acquisitions for reverse auction services 
to be competed amongst commercial reverse auction service providers, 
and for the resulting contract or agreement to be sufficiently 
documented and made available to agency contracting officers for future 
reference and verification needs;
     Clarifies requirements for contracting officers when 
conducting a reverse auction or utilizing the services of a reverse 
auction service provider;
     Requires the contracting officer's contact information to 
be available to offerors; and
     Provides guidance for situations in which only one offer 
is received in response to a reverse auction.
    The subpart also prescribes the use of a new provision, FAR 
provision 52.217-XX, Reverse Auction, and two new clauses, FAR clause 
52.217-YY, Reverse Auction-Orders or Calls, and 52.217-ZZ, Reverse 
Auction Services.
    FAR provision 52.217-XX is included in solicitations when the 
contracting officer will utilize a reverse auction to obtain 
competitive pricing for an award. It notifies offerors that by 
submission of a quote or proposal, offerors agree to participate in the 
reverse auction and agree that the Government may reveal to all 
offerors the offered price(s), but without revealing any offeror's 
identity, except for the awardee's identity subsequent to an award 
resulting from the auction. The provision also reserves the 
Government's right to cancel the auction, in the event only one offer 
is received, identifies that the Government may use the services of a 
reverse auction service provider to conduct the auction, and notifies 
offerors how to withdraw agreement from further participation in the 
auction.
    FAR clause 52.217-YY is included in solicitations for and within 
indefinite-delivery, indefinite-quantity contracts and blanket purchase 
agreements (BPA) when a reverse auction may be used to award an order 
under the contract or agreement. The clause provides BPA holders and 
contractors with a notification similar to that of FAR provision 
52.217-XX, but applies to delivery orders, task orders, or calls to be 
made under the basic contract or BPA.
    FAR clause 52.217-ZZ is included in solicitations and contracts for 
reverse auction services and specifies requirements for reverse auction 
service providers that provide reverse auction services to the 
Government.

B. Other Amendments to the FAR

    To implement reverse auction guidance, this rule proposes 
additional FAR amendments as follows:
    A definition for ``reverse auction'' is provided in FAR 2.101.
    In FAR 3.104-4, language is added to show that during reverse 
auctions, agencies may reveal to all offerors the offered price(s), but 
may not reveal any offeror's identity except for the awardee's identity 
subsequent to an award resulting from the auction.
    FAR 7.105(b)(4) is revised to address ``reverse auctions'' under 
acquisition plan requirements.
    FAR 13.104 is revised to refer contracting officers to the 
requirements of proposed subpart 17.8 when promoting competition and 
utilizing simplified acquisition procedures.
    The limitations at FAR 15.306(e)(3) are revised to permit the 
Government to reveal to all offerors the offered price(s), without 
revealing any offeror's identity, when having exchanges with offerors 
under negotiated acquisition procedures and utilizing a reverse auction 
to obtain pricing.
    FAR 17.000(d) is added to include reverse auctions in the list of 
special contracting methods in part 17.

[[Page 78817]]

III. Applicability to Contracts at or Below the Simplified Acquisition 
Threshold and for Commercial Items, Including Commercially Available 
Off-The-Shelf Items

    The reverse auction provision and clauses are available for use at 
or below the simplified acquisition threshold, and for commercial 
items, including commercially available off-the-shelf items.

IV. Executive Orders 12866 and 13563

    Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess 
all costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distributive impacts, and equity). E.O. 
13563 emphasizes the importance of quantifying both costs and benefits, 
of reducing costs, of harmonizing rules, and of promoting flexibility. 
This is not a significant regulatory action and, therefore, was not 
subject to review under section 6(b) of E.O. 12866, Regulatory Planning 
and Review, dated September 30, 1993. This rule is not a major rule 
under 5 U.S.C. 804.

V. Executive Order 13771

    This rule is not subject to E.O. 13771, because this rule is not a 
significant regulatory action under E.O. 12866.

VI. Regulatory Flexibility Act

    DoD, GSA, and NASA do not expect this rule to have a significant 
economic impact on a substantial number of small entities within the 
meaning of the Regulatory Flexibility Act, 5 U.S.C. 601, et seq. 
However, an initial regulatory flexibility analysis has been performed 
and is summarized as follows:

    DoD, GSA, and NASA are proposing to revise the Federal 
Acquisition Regulation (FAR) in response to a Government 
Accountability Office (GAO) report, GAO-14-108, Reverse Auctions: 
Guidance is Needed to Maximize Competition and Achieve Cost Savings, 
dated December 2013, and GAO report 18-446, Reverse Actions: 
Additional Guidance Could Help Increase Benefits and Reduce Fees, 
dated July 2018. Reverse auctions are a tool utilized by Federal 
agencies to increase competition and reduce the cost of certain 
items. During a reverse auction, offerors provide sequentially lower 
prices in an effort to win the contract award. The GAO report noted 
that the FAR does not specifically address reverse auctions and 
recommended that the Office of Management and Budget (OMB) take 
steps to amend the FAR to address agencies' use of reverse auctions.
    This proposed rule implements the June 1, 2015, Office of 
Federal Procurement Policy memorandum, Effective Use of Reverse 
Auctions, and addresses some of the concerns in the GAO reports. The 
objective of the rule is to ensure the effective use of reverse 
auctions to procure supplies and services within the Federal 
Government.
    The Government does not currently collect data on the number of 
awards that utilized a reverse auction to obtain pricing. However, 
GAO report 18-446 indicates that, while the total value of contracts 
awarded annually that utilize reverse auctions represents less than 
one percent of all annual Government contract spending, a majority 
of the annual contracts awarded that utilize reverse auctions are 
awarded to small business entities.
    The proposed rule does not impose any Paperwork Reduction Act 
reporting or recordkeeping requirements on any small entities. The 
rule does not duplicate, overlap, or conflict with any other Federal 
rules. No alternative approaches were considered. It is not 
anticipated that the proposed rule will have a significant economic 
impact on small entities.

    The Regulatory Secretariat has submitted a copy of the IRFA to the 
Chief Counsel for Advocacy of the Small Business Administration. A copy 
of the IRFA may be obtained from the Regulatory Secretariat. DoD, GSA, 
and NASA invite comments from small business concerns and other 
interested parties on the expected impact of this rule on small 
entities.
    DoD, GSA, and NASA will also consider comments from small entities 
concerning the existing regulations in subparts affected by this rule 
consistent with 5 U.S.C. 610. Interested parties must submit such 
comments separately and should cite 5 U.S.C. 610 (FAR Case 2015-038) in 
correspondence.

VII. Paperwork Reduction Act

    The rule does not contain any information collection requirements 
that require the approval of the Office of Management and Budget under 
the Paperwork Reduction Act (44 U.S.C. chapter 35).

List of Subjects in 48 CFR Parts 2, 3, 7, 13, 15, 17, and 52

    Government procurement.

William F. Clark,
Director, Office of Government-wide Acquisition Policy, Office of 
Acquisition Policy, Office of Government-wide Policy.

    Therefore, DoD, GSA, and NASA are proposing to amend 48 CFR parts 
2, 3, 7, 13, 15, 17, and 52 as set forth below:

0
1. The authority citation for 48 CFR parts 2, 3, 7, 13, 15, 17, and 52 
continues to read as follows:

    Authority:  40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 51 
U.S.C. 20113.

PART 2--DEFINITIONS OF WORDS AND TERMS

0
2. Amend section 2.101(b)(2) by adding in alphabetical order a 
definition for ``Reverse auction'' to read as follows:


2.101   Definitions.

* * * * *
    (b) * * *
    (2) * * *
    Reverse auction means the process for obtaining pricing, usually 
supported by an electronic tool, where offerors see competing offerors' 
price(s), without disclosure of the competing offerors' identity, and 
have the opportunity to submit lower priced offers until the close of 
the auction.
* * * * *

PART 3--IMPROPER BUSINESS PRACTICES AND PERSONAL CONFLICTS OF 
INTEREST

0
3. Amend section 3.103-2 by adding paragraph (a)(1)(iv) to read as 
follows:


3.103-2   Evaluating the certification.

    (a) * * *
    (1) * * *
    (iv) Participating in a reverse auction (see subpart 17.8).
* * * * *
0
4. Amend section 3.104-4 by revising paragraph (e)(1) to read as 
follows:


3.104-4   Disclosure, protection, and marking of contractor bid or 
proposal information and source selection information.

* * * * *
    (e) * * *
    (1) A contractor from disclosing its own bid or proposal 
information or the recipient from receiving that information. During 
reverse auctions, agencies may reveal to all offerors the offered 
price(s), but may not reveal any offeror's identity except for the 
awardee's identity subsequent to an award resulting from the auction 
(see subpart 17.8);
* * * * *

PART 7--ACQUISITION PLANNING


7.105   [Amended]

0
5. Amend section 7.105 by removing from paragraph (b)(4) introductory 
text ``including'' and adding ``including the basis for using a reverse 
auction (when applicable),'' in its place.

PART 13--SIMPLIFIED ACQUISITION PROCEDURES

0
6. Amend section 13.104 by adding paragraph (c) to read as follows:


13.104   Promoting competition.

* * * * *

[[Page 78818]]

    (c) When conducting a reverse auction, see subpart 17.8.

PART 15--CONTRACTING BY NEGOTIATION

0
7. Amend section 15.306 by revising paragraph (e)(3) to read as 
follows:


15.306   Exchanges with offerors after receipt of proposals.

* * * * *
    (e) * * *
    (3) Reveals an offeror's price without that offeror's permission. 
However, the contracting officer may inform an offeror that its price 
is considered by the Government to be too high, or too low, and reveal 
the results of the analysis supporting that conclusion. It is also 
permissible, at the Government's discretion, to indicate to all 
offerors the cost or price that the Government's price analysis, market 
research, and other reviews have identified as reasonable (41 U.S.C. 
2102 and 2107). When using reverse auction procedures (see subpart 
17.8), it is also permissible to reveal to all offerors the offered 
price(s), without revealing any offeror's identity;
* * * * *

PART 17--SPECIAL CONTRACTING METHODS

0
8. Revise section 17.000 by--
0
a. Removing from paragraph (b) the word ``and'';
0
b. Removing from paragraph (c) ``contracting.'' and adding 
``contracting; and'' in its place; and
0
c. Adding paragraph (d).
    The addition reads as follows:


17.000   Scope of part.

* * * * *
    (d) The use of reverse auctions to obtain competitive pricing.
0
9. Add subpart 17.8 to read as follows:
Subpart 17.8--Reverse Auctions
Sec.
17.800 Scope of subpart.
17.801 Definition.
17.802 Policy.
17.803 Applicability.
17.804 Procedures.
17.805 Solicitation provision and contract clauses.

Subpart 17.8--Reverse Auctions


17.800   Scope of subpart.

    This subpart prescribes policies and procedures for conducting 
reverse auctions and utilizing reverse auction service providers.


17.801   Definition.

    As used in this subpart, reverse auction service provider means a 
commercial or Government entity that provides a means for conducting 
reverse auctions when acquiring supplies or services to be used by the 
Government.


17.802   Policy.

    (a) The use of reverse auctions may be appropriate when market 
research indicates that--
    (1) A competitive marketplace exists for the supplies and/or 
services being acquired;
    (2) Multiple offerors can satisfy the agency's requirement; and
    (3) The nature of the supplies and/or services being acquired 
(e.g., clearly defined specifications, less complex requirements) 
encourages an iterative bidding process (i.e., multiple offerors 
participate and at least one offeror submits more than one offer during 
the reverse auction).
    (b) The reverse auction process is used to obtain pricing for an 
acquisition. When using the reverse auction process, contracting 
officers are still required to follow the acquisition policies and 
procedures (i.e., subpart 8.4 or 16.5 or part 13 or 15) prescribed 
elsewhere in the FAR, as appropriate for the particular acquisition.
    (c)(1) A service platform for conducting reverse auctions may be 
provided by a commercial or Government entity.
    (2) While some reverse auction service providers are paid directly 
by the Government for reverse auction services, other providers may 
incorporate a fee structure that uses an indirect payment method. When 
using an indirect payment method, the reverse auction service provider 
adds a fee(s) to the price of the winning offer that is provided to the 
Government at the close of an auction. The Government then pays the 
winning offeror the total price of the offer, which includes the fee(s) 
added by the reverse auction service provider. The reverse auction 
service provider then collects its fee(s) from the winning offeror.
    (3) When acquiring reverse auction services to be provided by a 
commercial reverse auction service provider, agencies shall--
    (i) Compete the requirement;
    (ii) Sufficiently detail the provider's fee structure in the 
resultant contract or agreement for reverse auction services; and
    (iii) Make the details of the contract or agreement for reverse 
auction services, including the provider's fee structure, available to 
contracting officers for consideration when determining whether to use 
a reverse auction service provider, in accordance with 17.804(a).
    (d) Contracting officers shall only use the services of a reverse 
auction service provider that--
    (1) Does not assert or imply that it can or will obtain a 
Government contract for participants of a reverse auction;
    (2) Allows entities to register, at no cost, as potential offerors 
for reverse auctions conducted on behalf of the Government on the 
provider's reverse auction platform;
    (3) Allows each entity, as part of the registration process, the 
opportunity to execute a proprietary data protection agreement with the 
provider; provided that the terms in the agreement do not affect the 
terms and conditions of a Government solicitation or contract;
    (4) Protects from unauthorized use or disclosure and does not 
release outside of the Government--
    (i) All contractor bid or proposal information (see 3.104-1) and 
source selection information associated with providing reverse auction 
services to the Government;
    (ii) All information similarly generated to support the issuance of 
a task or delivery order or call against a blanket purchase agreement; 
and
    (iii) Information identified by an offeror as restricted from 
duplication, use, or disclosure--in whole or in part--for any purpose 
other than to evaluate the reverse auction participant's price or 
proposal;
    (5) At the close of each auction--
    (i) Provides the Government with the winning offer, along with 
information that separately identifies the offeror's price and the 
price for each provider fee or charge included in the total price;
    (ii) Provides the Government with all information and documentation 
received from offerors in response to the reverse auction; and
    (iii) Removes all documentation received from offerors in response 
to the reverse auction from its business and computer systems;
    (6) Does not participate as an offeror in any reverse auction which 
the provider is hosting on behalf of the Government. This prohibition 
includes participation in a reverse auction by any entity with which 
the provider has a relationship that raises an actual or potential 
conflict of interest; and
    (7) Asserts no rights or license in the data gathered or generated 
during a reverse auction.
    (e) Only a contracting officer shall--
    (1) Exclude an offeror from participating in an auction;
    (2) Determine the awardee(s) of any reverse auction; or
    (3) Determine that the offeror is a responsible prospective 
contractor (see 9.103, 9.104-1, and 9.405(d)).

[[Page 78819]]

17.803   Applicability.

    Reverse auction processes shall not be used for--
    (a) Design-build construction contracts (see part 36);
    (b) Sealed bids (see part 14); or
    (c) Acquisition of personal protective equipment.


17.804   Procedures.

    (a) When considering the use of a reverse auction service provider, 
the contracting officer shall--
    (1) Conduct market research for available sources of reverse 
auction services (e.g., existing agency contracts or agreements (see 
17.802(c)), commercial service providers (see 17.802(d)), or Government 
service providers);
    (2) Evaluate the fee structure for each reverse auction service 
provider; and
    (3) Document the contract file with a determination that the use of 
a reverse auction service provider is cost effective.
    (b) When conducting a reverse auction, the contracting officer 
shall--
    (1) Only provide the offered price(s) to all offerors, without 
disclosing the identity of the offeror(s) (see 3.104-4(a) and (e)(1));
    (2) Allow offerors the opportunity to continually revise their 
prices downward during the reverse auction until the close of the 
auction; and
    (3) Allow an offeror to withdraw an offer from further 
consideration prior to the close of an auction.
    (c) When using the services of a reverse auction service provider, 
contracting officers shall--
    (1) Include contact information in the solicitation that will allow 
offerors to contact the contracting officer directly with any 
questions;
    (2) Upon receipt of a winning offer, verify that any provider fees 
or charges included in the price are in accordance with the provider's 
fee structure, as evaluated in accordance with paragraph (a)(2) of this 
section; and
    (3) Include in the contact file any information and/or 
documentation received by the reverse auction service provider from 
offerors responding to the reverse auction.
    (d) If only one offeror participates in an auction, the contracting 
officer may--
    (1) Cancel the auction and document the contract file with evidence 
of the participation of only one offeror; or
    (2) Accept the offer, only if the price is determined to be fair 
and reasonable (see 13.106-3(a)(2) and 15.404-1).


17.805   Solicitation provision and contract clauses.

    (a) The contracting officer shall insert the provision at 52.217-
XX, Reverse Auction, in solicitations, when the contracting officer is 
utilizing a reverse auction to award a contract or blanket purchase 
agreement.
    (b) The contracting officer shall insert the clause at 52.217-YY, 
Reverse Auction-Orders or Calls, in solicitations and contracts for a 
multiple award indefinite-delivery/indefinite-quantity contract or 
blanket purchase agreement, and a reverse auction may be used to place 
orders or calls under the basic contract or blanket purchase agreement.
    (c) The contracting officer shall insert the clause at 52.217-ZZ, 
Reverse Auction Services, in all solicitations and contracts for the 
purchase of reverse auction services.

PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

0
10. Add sections 52.217-XX, 52.217-YY, and 52.217-ZZ to read as 
follows:
* * * * *
52.217-XX Reverse auction.
52.217-YY Reverse auction-orders or calls.
52.217-ZZ Reverse auction services.
* * * * *


52.217-XX   Reverse auction.

    As prescribed in 17.805(a), insert the following provision:

Reverse Auction (Date)

    (a) Definitions. As used in this provision--
    Reverse auction means the process for obtaining pricing, usually 
supported by an electronic tool, where offerors see competing 
offerors' price(s), without disclosure of the competing offerors' 
identity, and have the opportunity to submit lower priced offers 
until the close of the auction.
    Reverse auction service provider means a commercial or 
Government entity that provides a means for conducting reverse 
auctions when acquiring supplies or services to be used by the 
Government.
    (b) Reverse auction. The Government intends to conduct a reverse 
auction under this solicitation to award a contract or blanket 
purchase agreement.
    (c) Offeror agreement. By submission of a quote or proposal in 
response to the solicitation, the Offeror agrees to participate in 
the reverse auction, and agrees that the Government may reveal to 
all Offerors the offered price(s) in the auction, without revealing 
any Offeror's identity, except for the awardee's identity subsequent 
to an award resulting from the auction. The Offeror may withdraw its 
agreement to further participate in the process by withdrawing its 
offer before the close of the auction by notifying the Contracting 
Officer via the contact method identified in the solicitation.
    (d) Only one offer. If the reverse auction produces only one 
offer, the Government reserves the right to cancel the auction.
    (e) Release of information. The Government may use a reverse 
auction service provider to conduct the reverse auction. Any price 
or proposal information or source selection information received by 
the reverse auction service provider in relation to the reverse 
auction shall not be released, outside of the Government, unless 
otherwise required by law. However, this does not prevent the 
Government from revealing to all Offerors the offered price(s) in 
the auction, without revealing any Offeror's identity. Price or 
proposal information includes, but is not limited to--
    (1) Contractor bid or proposal information, as defined at 
Federal Acquisition Regulation 3.104-1; and
    (2) Information identified by the Offeror as restricted from 
duplication, use, or disclosure--in whole or in part--for any 
purpose other than to evaluate the Offeror's price or proposal.

(End of Provision)


52.217-YY   Reverse auction-orders or calls.

    As prescribed in 17.805(b), insert the following clause:

Reverse Auction--Orders or Calls (Date)

    (a) Definitions. As used in this clause--
    Reverse auction means the process for obtaining pricing, usually 
supported by an electronic tool, where offerors see competing 
offerors' price(s), without disclosure of the competing offerors' 
identity, and have the opportunity to submit lower priced offers 
until the close of the auction.
    Reverse auction service provider means a commercial or 
Government entity that provides a means for conducting reverse 
auctions when acquiring supplies or services to be used by the 
Government.
    (b) Reverse auction. The Contracting Officer may conduct a 
reverse auction to award an order or call under this contract or 
blanket purchase agreement.
    (c) Offeror agreement. When a reverse auction is conducted under 
this contract or blanket purchase agreement, the following applies:
    (1) The Contractor's or blanket purchase agreement holder's 
submission of a quote or proposal in response to the solicitation 
for an order or call constitutes agreement to participate in the 
auction.
    (2) The Government may reveal to all Offerors the offered 
price(s) in the auction, without revealing any Offerors' identity, 
except for the awardee's identity subsequent to an award resulting 
from the auction.
    (3) The Contractor or blanket purchase agreement holder may 
withdraw its agreement to further participation in the reverse 
auction by withdrawing its offer. To withdraw an offer made in 
response to a reverse auction solicitation issued under this 
contract or blanket purchase agreement, the Contractor or blanket 
purchase agreement holder shall notify the Contracting Officer of 
the request before the close of the auction via the contact method 
identified in the solicitation.
    (4) If the reverse auction produces only one offer, the 
Government reserves the right to cancel the auction.

[[Page 78820]]

    (d) Release of information. The Government may use a reverse 
auction service provider to conduct the reverse auction. Any price 
or proposal information or source selection information received by 
the reverse auction service provider in relation to the reverse 
auction shall not be released, outside of the Government. However, 
this does not prevent the Government from revealing to all Offerors 
the offered price(s) in the auction, without revealing any Offeror's 
identity. Price or proposal information includes, but is not limited 
to--
    (1) Contractor bid or proposal information, as defined at 
Federal Acquisition Regulation 3.104-1;
    (2) Price or proposal information similarly generated for a task 
or delivery order or a call against a blanket purchase agreement; 
and
    (3) Information identified by the Offeror as restricted from 
duplication, use, or disclosure--in whole or in part--for any 
purpose other than to evaluate the Offeror's price or proposal.


(End of Clause)


52.217-ZZ  Reverse auction services.

    As prescribed in 17.805(c), insert the following clause:

Reverse Auction Services (Date)

    (a) Definition. Reverse auction means the process for obtaining 
pricing, usually supported by an electronic tool, where offerors see 
competing offerors' price(s), without disclosure of the competing 
offeror's identity, and have the opportunity to submit lower priced 
offers until the close of the auction.
    (b) Duties of the reverse auction service provider. When 
providing reverse auction services to the Government, the Contractor 
shall--
    (1) Not assert or imply that it can or will obtain a Government 
contract for the participants of a reverse auction;
    (2) Allow entities to register, at no cost, as potential 
offerors for any reverse auction conducted on behalf of the 
Government on the provider's reverse auction platform. As part of 
the registration process, the Contractor shall allow each entity the 
opportunity to execute a proprietary data protection agreement with 
the Contractor; however, the Contractor shall not negotiate terms in 
the agreement that affect the terms and conditions of a Government 
solicitation or contract;
    (3) Protect from unauthorized use or disclosure and not release 
outside of the Government any price or proposal information or any 
source selection information (see the ``source selection 
information'' definition in Federal Acquisition Regulation (FAR) 
2.101) received by the Contractor in relation to a reverse auction. 
However, this does not prevent the Contractor from revealing to all 
reverse auction participants the offered price(s) in the auction, 
without revealing any reverse auction participants' identity. Price 
or proposal information shall include, but is not limited to--
    (i) Contractor bid or proposal information, as defined at FAR 
3.104-1;
    (ii) Price or proposal information similarly generated for a 
task or delivery order or a call against a blanket purchase 
agreement; and
    (iii) Information identified by the reverse auction participant 
as restricted from duplication, use, or disclosure--in whole or in 
part--for any purpose other than to evaluate the reverse auction 
participant's price or proposal;
    (4) Not participate as an offeror in any reverse auction which 
the Contractor is hosting on behalf of the Government. This 
prohibition includes participation in a reverse auction by any 
entity with which the Contractor has a relationship that raises an 
actual or potential conflict of interest;
    (5) At the close of each auction--
    (i) Provide the Contracting Officer with the winning offer, 
along with information that separately identifies the offeror's 
price and the price for each provider fee or charge included in the 
total price;
    (ii) Provide the Contracting Officer with all information and 
documentation received from reverse auction participants in response 
to the reverse auction; and
    (iii) Remove all documentation received from reverse auction 
participants in response to the reverse auction from its business 
and computer systems; and
    (6) Assert no right or license in the data gathered or generated 
during a reverse auction.


(End of Clause)

[FR Doc. 2020-24936 Filed 12-4-20; 8:45 am]
BILLING CODE 6820-EP-P