FAR 3.104-1—Definitions.
Plain-English Summary
FAR 3.104-1 is the definitions section for the procurement integrity rules in FAR 3.104, which govern restrictions on the disclosure and use of contractor bid or proposal information and source selection information, as well as related ethics and post-employment issues. It defines who counts as an agency ethics official, what compensation means, what information qualifies as contractor bid or proposal information, what constitutes a decision to award a subcontract or subcontract modification, what is meant by a Federal agency procurement, how to measure whether a procurement is in excess of $10,000,000, who is an official, what it means to participate personally and substantially in a procurement, and what a source selection evaluation board is. These definitions matter because they determine when the procurement integrity restrictions apply, who is covered, what information is protected, and which actions can create conflicts or trigger reporting and recusal obligations. In practice, the section sets the threshold for ethics reviews, post-government employment analysis, and contractor handling of sensitive proposal data. It also clarifies that certain broad agency announcements and SBIR proposals are treated as separate procurements for these purposes. For contracting officers, source selection personnel, ethics officials, and contractors, these definitions are the foundation for compliance with the rest of FAR 3.104.
Key Rules
Agency ethics officials
The term includes the designated agency ethics official and certain delegated or alternate ethics officials. These officials are the key points of contact for ethics advice and for authority delegated under FAR 3.104-6.
Compensation is broad
Compensation includes wages, salaries, honoraria, commissions, professional fees, and any other form of payment for services, whether paid directly or indirectly. Indirect payment counts if an entity is paid in exchange for the individual’s services.
Protected bid or proposal information
Contractor bid or proposal information includes specified nonpublic information submitted in connection with a procurement, such as cost or pricing data, indirect costs and direct labor rates, proprietary manufacturing information, and information marked as contractor bid or proposal information or marked under 52.215-1(e).
Subcontract award decisions covered
A decision to award a subcontract or subcontract modification means the decision to designate award to a particular source. This matters because procurement integrity restrictions can extend to certain subcontracting decisions, not just prime contract awards.
Federal agency procurement defined
A Federal agency procurement is the acquisition of goods or services, including construction, from non-Federal sources by a Federal agency using appropriated funds and competitive procedures. For broad agency announcements and SBIR programs, each proposal is treated as a separate procurement for chapter 21 purposes.
Over $10 million threshold
The definition of 'in excess of $10,000,000' depends on the type of action and includes the contract value with options, total estimated value of IDIQ or requirements contracts, most multiple-award schedule contracts unless a lower estimate is documented, delivery/task orders and BOAs, claim settlements, and estimated negotiated overhead or other rates applied to the Government base.
Who is an official
Official includes officers, employees, members of the uniformed services, and special Government employees. This broad coverage determines who may be subject to procurement integrity and ethics restrictions.
Personal and substantial participation
An official participates personally and substantially when they are directly and significantly involved in drafting requirements, preparing the solicitation, evaluating bids or proposals, selecting a source, negotiating terms, or approving award. Direct supervision of a subordinate’s participation counts as personal participation, and substantial participation requires meaningful significance, not merely administrative or peripheral involvement.
Activities that usually do not count
The rule identifies activities that generally do not amount to personal and substantial participation, such as broad advisory committee work, general technical work not tied to a specific procurement, clerical support, and certain A-76-related support activities. Mere compliance review of procurement documents for regulatory, administrative, or budgetary purposes is also not substantial participation.
Source selection evaluation board
A source selection evaluation board is any board, team, council, or similar group that evaluates bids or proposals. Membership in such a group is important because it often places personnel squarely within procurement integrity restrictions.
Responsibilities
Contracting Officer
Identify when a procurement falls within the scope of FAR 3.104 and apply the correct threshold and information protections. Ensure source selection and award personnel understand whether they are personally and substantially participating and coordinate with ethics officials when needed.
Agency Ethics Official
Provide ethics guidance, determine coverage and conflicts, and exercise delegated authority under FAR 3.104-6 where applicable. Advise officials on whether their role in a procurement triggers procurement integrity restrictions or recusal obligations.
Source Selection Personnel
Recognize that participation in drafting requirements, evaluating proposals, negotiating, or approving award may be personal and substantial. Protect nonpublic contractor bid or proposal information and avoid unauthorized disclosure or use.
Contractors
Properly mark protected proposal information where required and understand that certain submitted information remains protected if not publicly disclosed. Be aware that subcontract award decisions and proposal submissions may be covered by procurement integrity rules.
Agency
Train personnel, designate ethics officials, and ensure procurement teams understand the definitions that trigger procurement integrity obligations. Maintain procedures for identifying covered procurements, covered officials, and protected information.
Source Selection Evaluation Board
Evaluate bids or proposals while safeguarding source selection and contractor bid or proposal information. Members must understand that their role typically places them within the scope of procurement integrity restrictions.
Practical Implications
These definitions control the reach of the procurement integrity rules, so a mistake at the definition stage can lead to a compliance failure later.
The 'personally and substantially' standard is often the key issue in ethics reviews; even limited but critical involvement can trigger restrictions.
Contractors should be careful about marking proposal information correctly, because some protections depend on proper marking and on whether the information was already public.
The $10 million threshold is not always the face value of the contract; different contract types and orders require different valuation methods.
Personnel who think they are only providing administrative, technical, or advisory support may still be covered if their work is tied closely enough to a specific procurement.
Official Regulatory Text
As used in this section— Agency ethics official means the designated agency ethics official described in 5 CFR 2638.201 or other designated person, including– (1) Deputy ethics officials described in 5 CFR 2638.204 , to whom authority under 3.104-6 has been delegated by the designated agency ethics official; and (2) Alternate designated agency ethics officials described in 5 CFR 2638.202(b) . Compensation means wages, salaries, honoraria, commissions, professional fees, and any other form of compensation, provided directly or indirectly for services rendered. Compensation is indirectly provided if it is paid to an entity other than the individual, specifically in exchange for services provided by the individual. Contractor bid or proposal information means any of the following information submitted to a Federal agency as part of or in connection with a bid or proposal to enter into a Federal agency procurement contract, if that information has not been previously made available to the public or disclosed publicly: (1) Cost or pricing data (as defined by 10 U.S.C. 3701(1) with respect to procurements subject to that section, and 41 U.S.C. 3501(a)(1), with respect to procurements subject to that section. (2) Indirect costs and direct labor rates. (3) Proprietary information about manufacturing processes, operations, or techniques marked by the contractor in accordance with applicable law or regulation. (4) Information marked by the contractor as "contractor bid or proposal information" in accordance with applicable law or regulation. (5) Information marked in accordance with 52.215-1 (e). Decision to award a subcontract or modification of subcontract means a decision to designate award to a particular source. Federal agency procurement means the acquisition (by using competitive procedures and awarding a contract) of goods or services (including construction) from non-Federal sources by a Federal agency using appropriated funds. For broad agency announcements and small business innovation research programs, each proposal received by an agency constitutes a separate procurement for purposes of 41 U.S.C. chapter 21. In excess of $10,000,000 means– (1) The value, or estimated value, at the time of award, of the contract, including all options; (2) The total estimated value at the time of award of all orders under an indefinite-delivery, indefinite-quantity, or requirements contract; (3) Any multiple award schedule contract, unless the contracting officer documents a lower estimate; (4) The value of a delivery order, task order, or an order under a Basic Ordering Agreement; (5) The amount paid or to be paid in settlement of a claim; or (6) The estimated monetary value of negotiated overhead or other rates when applied to the Government portion of the applicable allocation base. Official means– (1) An officer, as defined in 5 U.S.C.2104 ; (2) An employee, as defined in 5 U.S.C.2105 ; (3) A member of the uniformed services, as defined in 5 U.S.C.2101(3) ; or (4) A special Government employee, as defined in 18 U.S.C.202. Participating personally and substantially in a Federal agency procurement means– (1) Active and significant involvement of an official in any of the following activities directly related to that procurement: (i) Drafting, reviewing, or approving the specification or statement of work for the procurement.: (ii) Preparing or developing the solicitation. (iii) Evaluating bids or proposals, or selecting a source. (iv) Negotiating price or terms and conditions of the contract. (v) Reviewing and approving the award of the contract. (2) "Participating personally" means participating directly, and includes the direct and active supervision of a subordinate's participation in the matter. (3) "Participating substantially" means that the official's involvement is of significance to the matter. Substantial participation requires more than official responsibility, knowledge, perfunctory involvement, or involvement on an administrative or peripheral issue. Participation may be substantial even though it is not determinative of the outcome of a particular matter. A finding of substantiality should be based not only on the effort devoted to a matter, but on the importance of the effort. While a series of peripheral involvements may be insubstantial, the single act of approving or participating in a critical step may be substantial. However, the review of procurement documents solely to determine compliance with regulatory, administrative, or budgetary procedures, does not constitute substantial participation in a procurement. (4) Generally, an official will not be considered to have participated personally and substantially in a procurement solely by participating in the following activities: (i) Agency-level boards, panels, or other advisory committees that review program milestones or evaluate and make recommendations regarding alternative technologies or approaches for satisfying broad agency-level missions or objectives. (ii) The performance of general, technical, engineering, or scientific effort having broad application not directly associated with a particular procurement, notwithstanding that such general, technical, engineering, or scientific effort subsequently may be incorporated into a particular procurement. (iii) Clerical functions supporting the conduct of a particular procurement. (iv) For procurements to be conducted under the procedures of OMB Circular A-76, participation in management studies, preparation of in-house cost estimates, preparation of "most efficient organization" analyses, and furnishing of data or technical support to be used by others in the development of performance standards, statements of work, or specifications. Source selection evaluation board means any board, team, council, or other group that evaluates bids or proposals.