FAR 25.702-1—Definitions.
Plain-English Summary
FAR 25.702-1 provides the definitions used in the Sudan-related restrictions in FAR 25.702, so it is the starting point for understanding who and what is covered by the rule. It defines four key terms: "appropriate Congressional committees," "business operations," "marginalized populations of Sudan," and "restricted business operations." These definitions matter because they determine the scope of the Sudan divestment and contracting restrictions, including what kinds of commercial activity count as covered business operations, which Sudanese populations are relevant for humanitarian exceptions, and what activities are treated as restricted unless an exception applies. In practice, contractors and contracting officers use these definitions to decide whether a company’s Sudan-related activities trigger disclosure, certification, responsibility, or award restrictions elsewhere in FAR 25.702. The section is important because the legal consequences depend heavily on the exact nature of the business activity and whether it falls within one of the listed exceptions. It also ties the FAR rule to specific statutory and executive-branch authorities, including the Sudan Accountability and Divestment Act and OFAC authorization.
Key Rules
Congressional committees defined
The rule identifies the specific Senate and House committees that are the "appropriate Congressional committees" for purposes of the section. This matters because any required reporting or notification under the Sudan restrictions is directed to these named committees, not to Congress generally.
Broad business operations scope
"Business operations" is defined broadly to include engaging in commerce in any form, including acquiring, developing, maintaining, owning, selling, possessing, leasing, or operating a wide range of assets and activities. The definition is intentionally expansive so that indirect and direct commercial involvement can both be captured.
Marginalized populations in Sudan
The term covers adversely affected groups in regions authorized to receive assistance under the Darfur Peace and Accountability Act and marginalized areas in Northern Sudan described in that Act. This definition helps identify the humanitarian and regional populations that are relevant to certain exceptions and exclusions.
Restricted operations in Sudan
"Restricted business operations" generally means business operations in Sudan involving power production, mineral extraction, oil-related activities, or production of military equipment. These are the core categories of activity that trigger the Sudan restrictions unless an exception applies.
Enumerated exceptions
Certain Sudan business operations are not treated as restricted if the person can demonstrate they fall within one of the listed exceptions, such as direct and exclusive contracts with the regional government of southern Sudan, OFAC authorization or a federal-law exemption, provision of goods or services to marginalized populations, peacekeeping or humanitarian support, health or education uses, or voluntary suspension.
Burden of demonstration
The person conducting the business must be able to demonstrate that an exception applies. In practice, this means the contractor bears the burden of showing documentation or other evidence that the activity is outside the restricted category.
Responsibilities
Contractor / Offeror
Determine whether any Sudan-related activities fall within the broad definition of business operations and whether those activities are restricted business operations. If relying on an exception, maintain evidence showing the activity qualifies, such as OFAC authorization, contract terms, humanitarian purpose, health or education use, or proof of voluntary suspension.
Contracting Officer
Use these definitions when evaluating whether a contractor’s Sudan-related activities are covered by FAR 25.702 and whether any representation, certification, or award restriction applies. Request clarification or supporting information when the contractor claims an exception.
Agency
Apply the definitions consistently in procurement screening, responsibility determinations, and any required reporting or compliance actions tied to Sudan-related restrictions. Ensure acquisition personnel understand the scope of the defined terms and the statutory exceptions.
Legal / Compliance Staff
Interpret whether specific commercial activities fit within the defined categories and whether claimed exceptions are legally sufficient. Coordinate review of OFAC authorizations, statutory exemptions, and documentary support for any asserted exclusion from restricted business operations.
Practical Implications
The definition of business operations is very broad, so contractors should not assume only direct sales or physical presence in Sudan matter; ownership, leasing, operating, or maintaining assets can also count.
The exceptions are narrow and evidence-based. A contractor claiming an exception should be prepared to document the basis, not just state that the activity is humanitarian or suspended.
OFAC authorization is a key safe harbor, but only if the authorization actually covers the activity; a general sanctions license or unrelated exemption may not be enough.
Because restricted business operations focus on specific sectors, contractors should map their Sudan activities carefully to power production, mineral extraction, oil-related work, or military equipment production.
Contracting officers should treat these definitions as threshold questions: before applying any downstream FAR 25.702 restriction, first determine whether the activity is a business operation, whether it is in Sudan, whether it is restricted, and whether an exception is proven.
Official Regulatory Text
As used in this section- Appropriate Congressional committees means- (1) The Committee on Banking, Housing, and Urban Affairs, The Committee on Foreign Relations, and the Select Committee on Intelligence of the Senate; and (2) The Committee on Financial Services, the Committee on Foreign Relations, and the Permanent Select Committee on Intelligence of the House of Representatives. Business operations means engaging in commerce in any form, including by acquiring, developing, maintaining, owning, selling, possessing, leasing, or operating equipment, facilities, personnel, products, services, personal property, real property, or any other apparatus of business or commerce. Marginalized populations of Sudan means- (1) Adversely affected groups in regions authorized to receive assistance under section 8(c) of the Darfur Peace and Accountability Act (Pub. L. 109-344) ( 50 U.S.C. 1701 note); and (2) Marginalized areas in Northern Sudan described in section 4(9) of such Act. Restricted business operations - (1) Means, except as provided in paragraph (2) of this definition, business operations in Sudan that include power production activities, mineral extraction activities, oil-related activities, or the production of military equipment, as those terms are defined in the Sudan Accountability and Divestment Act of 2007 (Pub. L. 110-174). (2) Does not include business operations that the person (as that term is defined in Section 2 of the Sudan Accountability and Divestment Act of 2007) conducting the business can demonstrate- (i) Are conducted under contract directly and exclusively with the regional government of southern Sudan; (ii) Are conducted pursuant to specific authorization from the Office of Foreign Assets Control in the Department of the Treasury, or are expressly exempted under Federal law from the requirement to be conducted under such authorization; (iii) Consist of providing goods or services to marginalized populations of Sudan; (iv) Consist of providing goods or services to an internationally recognized peacekeeping force or humanitarian organization; (v) Consist of providing goods or services that are used only to promote health or education; or (vi) Have been voluntarily suspended.