FAR 14.404-2—Rejection of individual bids.
Plain-English Summary
FAR 14.404-2 explains when a contracting officer must reject an individual bid under sealed bidding. It covers nonconforming bids, including bids that fail to meet the invitation’s essential requirements, specifications, delivery schedule, or permissible alternates; bids that impose objectionable conditions or limit the bidder’s liability; bids with unreasonable prices; materially unbalanced bids; bids from suspended, debarred, proposed-debarment, or ineligible firms; bids from nonresponsible bidders; bids lacking a required bid guarantee; and bids affected by post-bid-opening asset transfers. It also addresses the limited ability to ask a low bidder to delete a non-substantive objectionable condition, and it requires preservation of rejected bids and written findings. In practice, this section protects the integrity of sealed bidding by ensuring that all bidders compete on the same terms and that the Government does not accept a bid that changes the solicitation, creates unfairness, or presents unacceptable risk. It is a strict rule set: if a bid is nonresponsive or otherwise disqualified under these standards, the contracting officer generally must reject it rather than cure the defect after opening.
Key Rules
Essential requirements control
Any bid that fails to conform to the invitation’s essential requirements must be rejected. This is the core responsiveness rule in sealed bidding: the bid must match what the solicitation asked for, not what the bidder wishes to offer.
Specifications and alternates
A bid that does not meet the applicable specifications must be rejected unless the IFB expressly allowed alternate bids and the alternate supplies meet the stated requirements. The bidder cannot substitute a different product unless the solicitation authorized that approach.
Delivery terms must match
A bid that fails to conform to the required delivery schedule or permissible alternates in the invitation must be rejected. Delivery promises are part of the bid’s responsiveness and cannot be changed after opening without harming competition.
No objectionable conditions
A bid must be rejected if it adds conditions that modify the solicitation or limit the bidder’s liability to the Government. Examples include price-escalation protections, open-ended pricing, conditional award language tied to other solicitations, self-certification of compliance where not allowed, or attempts to limit Government rights under contract clauses.
Minor conditions may be deleted
The contracting officer may ask a low bidder to remove an objectionable condition only if the condition is not substantive and deleting it would not prejudice other bidders. A condition is substantive if it affects price, quantity, quality, or delivery.
Unreasonable price is rejectable
A bid may be rejected if the contracting officer determines in writing that the price is unreasonable. This applies to the total bid price and to individual line-item prices, so a single outlier line item can justify rejection.
Materially unbalanced pricing
A bid may be rejected if any line item or subline item is materially unbalanced. The concern is that the bid may create risk of paying too much for some items or distort the competition, especially where quantities may vary.
Excluded or ineligible bidders
Bids from suspended, debarred, proposed-debarment, or otherwise ineligible firms received as of bid opening must be rejected unless a compelling reason determination is made. This protects the Government from awarding to firms that are not eligible to receive contracts.
Responsibility and COC rules
Low bids from nonresponsible bidders must be rejected. If the bidder is a small business, the contracting officer must consider the certificate of competency procedures in the small business regulations before final rejection.
Bid guarantee compliance
If the IFB requires a bid guarantee and the bidder fails to provide it as required, the bid must be rejected unless an exception in FAR 28.101-4 applies. The guarantee requirement is a material condition of the bid.
Recordkeeping for rejected bids
The originals of rejected bids and any written findings supporting rejection must be kept with the acquisition file. This preserves the record for audit, protest, and accountability purposes.
Post-bid asset transfers
If a bidder transfers all assets, or the assets related to the bid, after bid opening but before award, the contracting officer must reject the bid unless the transfer occurred by merger, operation of law, or another legally permitted means. This prevents improper assignment of bids and protects the integrity of the award process.
Responsibilities
Contracting Officer
Evaluate each bid for responsiveness and reject bids that fail to meet essential requirements, specifications, delivery terms, or permissible alternates. Determine whether any objectionable condition is substantive, whether price is unreasonable, whether pricing is materially unbalanced, whether the bidder is excluded or nonresponsible, whether a required bid guarantee is missing, and whether a post-opening asset transfer bars award. Make required written findings, preserve rejected bids and supporting documentation, and apply the small business certificate of competency procedures when appropriate.
Bidder
Submit a bid that fully conforms to the IFB, including specifications, delivery schedule, alternates, pricing structure, and required bid guarantee. Avoid adding conditions, qualifications, or limitations that change the Government’s requirements or reduce bidder liability, and maintain eligibility through bid opening and award.
Agency
Maintain suspension and debarment status information, support compelling reason determinations when an award to an excluded firm is considered, and ensure acquisition files retain rejected bids and written findings. The agency also must follow the applicable responsibility and small business procedures that interact with bid rejection decisions.
Small Business Administration
When a small business bidder is found nonresponsible, administer the certificate of competency process under the small business regulations where applicable. This provides the statutory review path before a final rejection based on responsibility grounds.
Practical Implications
This section is a strict sealed-bidding gatekeeper: if a bid is nonresponsive, the Government usually cannot fix it after opening without giving that bidder an unfair advantage.
Many rejections turn on small wording differences, such as conditional pricing, price escalation language, or statements that make award contingent on another procurement.
Contracting officers should distinguish carefully between a minor irregularity that can be waived or clarified and a substantive defect that affects price, quantity, quality, or delivery.
Price review is not limited to the total bid; line-item pricing and unbalanced pricing can also justify rejection, so both the overall and item-level structure matter.
Documentation matters: written findings and preserved rejected bids are essential for protests, audits, and showing that the rejection was based on the solicitation and the FAR, not discretion or preference.
Official Regulatory Text
(a) Any bid that fails to conform to the essential requirements of the invitation for bids shall be rejected. (b) Any bid that does not conform to the applicable specifications shall be rejected unless the invitation authorized the submission of alternate bids and the supplies offered as alternates meet the requirements specified in the invitation. (c) Any bid that fails to conform to the delivery schedule or permissible alternates stated in the invitation shall be rejected. (d) A bid shall be rejected when the bidder imposes conditions that would modify requirements of the invitation or limit the bidder’s liability to the Government, since to allow the bidder to impose such conditions would be prejudicial to other bidders. For example, bids shall be rejected in which the bidder- (1) Protects against future changes in conditions, such as increased costs, if total possible costs to the Government cannot be determined; (2) Fails to state a price and indicates that price shall be "price in effect at time of delivery;" (3) States a price but qualifies it as being subject to "price in effect at time of delivery;" (4) When not authorized by the invitation, conditions or qualifies a bid by stipulating that it is to be considered only if, before date of award, the bidder receives (or does not receive) award under a separate solicitation; (5) Requires that the Government is to determine that the bidder’s product meets applicable Government specifications; or (6) Limits rights of the Government under any contract clause. (e) A low bidder may be requested to delete objectionable conditions from a bid provided the conditions do not go to the substance, as distinguished from the form, of the bid, or work an injustice on other bidders. A condition goes to the substance of a bid where it affects price, quantity, quality, or delivery of the items offered. (f) Any bid may be rejected if the contracting officer determines in writing that it is unreasonable as to price. Unreasonableness of price includes not only the total price of the bid, but the prices for individual line items as well. (g) Any bid may be rejected if the prices for any line items or subline items are materially unbalanced (see 15.404-1 (g)). (h) Bids received from any person or concern that is suspended, debarred, proposed for debarment or declared ineligible as of the bid opening date shall be rejected unless a compelling reason determination is made (see subpart 9.4 ). (i) Low bids received from concerns determined to be not responsible pursuant to subpart 9.1 shall be rejected (but if a bidder is a small business concern, see19.6 with respect to certificates of competency). (j) When a bid guarantee is required and a bidder fails to furnish the guarantee in accordance with the requirements of the invitation for bids, the bid shall be rejected, except as otherwise provided in 28.101-4 . (k) The originals of all rejected bids, and any written findings with respect to such rejections, shall be preserved with the papers relating to the acquisition. (l) After submitting a bid, if all of a bidder’s assets or that part related to the bid are transferred during the period between the bid opening and the award, the transferee may not be able to take over the bid. Accordingly, the contracting officer shall reject the bid unless the transfer is effected by merger, operation of law, or other means not barred by 41 U.S.C.6305 or 31 U.S.C. 3727 .