In this time of dynamic developments for federal procurement policy, as we described in our previous advisory, three important executive orders and an Office of Federal Procurement Policy (“OFPP”) initiative aimed at consolidating procurement functions under the General Services Administration (“GSA”), overhauling the Federal Acquisition Regulation (“FAR”), and modernizing the Department of Defense’s acquisition framework. Within days of publication of our recent advisory, discussing the OFPP initiative to overhaul the FAR, GSA procurement consolidation, and modernization of the DoD’s acquisition framework, the White House issued two additional executive orders. These new orders deepen the Trump administration’s commitment to reshaping the federal procurement landscape and underscore the administration’s escalating emphasis on deregulation, commerciality, and speed.

The first, “Restoring Common Sense to Federal Procurement,” accelerates the FAR overhaul by embedding a regulatory sunset framework and directing agencies to eliminate non-statutory rules unless essential to “sound procurement.” The second, “Ensuring Commercial, Cost-Effective Solutions in Federal Contracts,” reinforces commercial item preferences by introducing rigorous oversight mechanisms to ensure agencies minimize custom-built or government-unique purchases. These developments build on earlier reforms and reflect a comprehensive strategy to reduce cost, encourage innovation, and align federal procurement more closely with private-sector practices.

Focused Efforts to Streamline the Federal Acquisition Regulations

Issued on April 15, 2025, Executive Order (“EO”) “Restoring Common Sense to Federal Procurement” builds upon the recent initiatives aimed at overhauling and modernizing the federal acquisition system, by requiring members of the FAR Council and heads of agencies to take appropriate measures, within 180 days of the order, to amend the FAR to contain provisions that are “required by statute or that are otherwise necessary to support simplicity and usability, strengthen the efficacy of the procurement system, or protect economic or national security interests.” During this process, the FAR Council will issue deviation and interim guidance until final rules reforming the FAR are published.

Previously, and as described in our previous advisory, the OFPP was tasked with leading the comprehensive overhaul of the FAR, focusing on simplifying complex regulations and removing non-statutory requirements that hinder procurement efficiency. The new executive order accelerates this initiative by mandating a thorough review of the FAR, stating that “the FAR should contain only provisions required by statute or essential to sound procurement, and any FAR provisions that do not advance these objectives should be removed.” Additionally, the EO inserts a “regulatory sunset” framework, whereby any non-statutory provision that remains in or is added to the FAR may be required to expire within four years, unless renewed by the FAR Council. The EO also emphasizes the importance of aligning agency-specific procurement regulations with the reformed FAR, requiring each agency to designate a senior acquisition official, within 15 days of the order, to collaborate with the FAR Council. Finally, within 20 days of the order, the Office of Management and Budget (“OMB”) will issue a memorandum to agencies that provides guidance on implementing this order.

While the executive order aims to simplify and modernize the procurement system, it also introduces a period of regulatory uncertainty that may prove challenging for federal contractors. The mandated review and removal of all non-statutory FAR provisions, combined with the introduction of sunset clauses for those that remain, could result in frequent changes to compliance obligations. Contractors may be forced to navigate a fragmented environment where some agencies adopt new deviations and reforms more quickly than others, and contracts almost certainly will be subject to a patchwork of requirements depending on when they were awarded, creating inconsistency across the federal procurement landscape. Moreover, the transitional period may increase internal costs, as contractors will need to update compliance systems, retrain staff, and reassess risk management practices in response to evolving rules.

Contractors should remain vigilant during this transition period, as adjustments to internal processes and compliance strategies may be necessary to adapt to the evolving regulatory framework.

Continued Trends Toward Commercial Solutions in Procurement

Also issued on April 15, 2025, the EO, “Ensuring Commercial, Cost-Effective Solutions in Federal Contracts” directs federal agencies to prioritize commercially available products and services “to the maximum extent practicable,” reinforcing and revitalizing long-standing statutory mandates under the Federal Acquisition Streamlining Act of 1994 (“FASA”). The order is aimed at reinstating FASA’s emphasis on eliminating unnecessary government spending and avoiding the use of government-unique or custom-developed solutions where a commercial option can satisfy agency needs. The President criticized past practices and regulatory adjustments that “evaded statutory preferences and abused the Federal contracting framework by procuring custom products and services where a suitable or superior commercial solution would have fulfilled the Government's needs,” arguing that this not only increased costs but “stifled the integration of commercially available innovations in Government procurement.”

To implement this policy, the executive order imposes near-term and ongoing procedural requirements on all executive agencies. Within 60 days, each agency’s designated approval authority must direct contracting officers to review all open solicitations and notices involving non-commercial products or services. These solicitations must then be compiled into applications justifying the absence of a commercial solution, including detailed market research, price analysis, and rationale as required by 41 U.S.C. § 3307(d) and 10 U.S.C. § 3453. Within 30 days of receiving those applications, the agency approval authority must evaluate their compliance with FASA and take “appropriate action with respect to any deficiencies,” including requiring additional market research or reconsideration of a commercial approach.

In addition, each agency is required to report to the OMB within 120 days of the order and annually thereafter, describing its compliance efforts and progress in shifting toward commercial procurements. Going forward, any proposed solicitation for non-commercial items must be approved in writing by the agency’s approval authority and may be subject to further review by the Director of OMB, who is authorized to make written recommendations to approve or deny the proposed procurement. According to the accompanying Fact Sheet, agencies can procure or maintain contracts for custom products if they file a justified waiver within 60 days, which must be approved or denied in writing.

This executive order presents both opportunities and challenges for federal contractors. On the one hand, it expands the federal market for commercial product and service providers, particularly those already operating in the private sector. Contractors offering “commercially available products and services, including those that can be modified to fill agencies’ needs,” stand to benefit as agencies are pushed to adopt market-tested, cost-effective solutions.

The new approval and oversight requirements may have an impact on more complex or specialized procurements, potentially requiring revisions or even cancelations of existing procurements actions in order to implement more commercial focus and requirements. Agencies accustomed to procuring custom-developed solutions, for example, may experience internal delays navigating the new procedures which could translate into procurement delays. This could affect contractors that rely on R&D-heavy, specialized, or defense-unique offerings, as they may face higher administrative barriers and longer procurement lead times.