FAR 52.217-10—Reverse Auction
Plain-English Summary
FAR 52.217-10, Reverse Auction, is a solicitation provision used when the Government plans to conduct a reverse auction to award a contract or blanket purchase agreement. It defines what a reverse auction is and identifies the reverse auction service provider as either a commercial or Government entity that facilitates the auction process. The provision also tells offerors that by submitting a quote or proposal they agree to participate in the auction, including the Government’s ability to disclose offered prices to all offerors without revealing identities, while preserving the awardee’s identity after award. It explains how an offeror may withdraw from further participation before the auction closes, and it reserves the Government’s right to cancel the auction if only one offer is received. Finally, it addresses release and protection of price, proposal, and source selection information when a service provider is used, including references to contractor bid or proposal information under FAR 3.104-1 and other information the offeror marks as restricted. In practice, this provision is about transparency in competitive pricing, protecting sensitive information, and setting the ground rules for electronic or facilitated price competition in a way that is fair, efficient, and legally controlled.
Key Rules
Auction Will Be Used
The solicitation must tell offerors that the Government intends to conduct a reverse auction for the award of a contract or blanket purchase agreement. This puts offerors on notice that pricing may be competed in real time rather than only through a single sealed submission.
Reverse Auction Defined
A reverse auction is a pricing process, usually supported by an electronic tool, where offerors can see competing prices without seeing competitors’ identities and can submit lower prices until the auction closes. The definition matters because it frames the competitive process and the information that may be shared during the auction.
Submission Means Consent
By submitting a quote or proposal, the offeror agrees to participate in the reverse auction and agrees that the Government may disclose offered prices to all offerors without revealing identities. The only identity that may be revealed after award is the awardee’s identity.
Withdrawal Is Allowed Before Close
An offeror may stop participating by withdrawing its offer before the auction closes, but it must notify the Contracting Officer using the contact method identified in the solicitation. Withdrawal ends further participation; it does not change the fact that the offeror initially agreed to the auction process by submitting a response.
Single Offer May Cancel Auction
If the reverse auction results in only one offer, the Government reserves the right to cancel the auction. This protects the Government from using a reverse auction process when there is no meaningful competition.
Service Provider Information Must Be Protected
If the Government uses a reverse auction service provider, any price, proposal, or source selection information received by that provider may not be released outside the Government unless required by law. The provision is designed to prevent the service provider from becoming a disclosure risk.
Protected Information Includes More Than Prices
Price or proposal information includes contractor bid or proposal information under FAR 3.104-1 and any information the offeror marks as restricted from duplication, use, or disclosure for purposes other than evaluating price or proposal. Offerors should assume that sensitive markings and statutory protections remain important even in a reverse auction setting.
Responsibilities
Contracting Officer
State in the solicitation that a reverse auction will be used, identify the contact method for withdrawal, manage the auction process, protect sensitive information, and decide whether to cancel the auction if only one offer is received. The Contracting Officer must also ensure the awardee’s identity is revealed only after award.
Offeror
Submit a quote or proposal with the understanding that doing so constitutes agreement to participate in the reverse auction and to have offered prices disclosed to other offerors without identity disclosure. The offeror must follow the solicitation’s withdrawal instructions if it wants to stop participating before the auction closes.
Government
Conduct the reverse auction fairly, disclose offered prices to all offerors without revealing identities, and protect price, proposal, and source selection information from outside release except as required by law. The Government must also preserve the awardee’s identity disclosure only after award.
Reverse Auction Service Provider
Provide the means for conducting the reverse auction, if used, and safeguard any price, proposal, or source selection information received in connection with the auction. The provider may not release that information outside the Government unless a legal requirement permits or requires disclosure.
Practical Implications
Offerors should expect live price competition and should be prepared to react quickly if the auction allows multiple rounds of lower pricing.
Submitting a proposal is not just a price submission; it is also consent to the reverse auction rules, including disclosure of offered prices to competitors without names.
Contracting officers need a clear withdrawal contact method in the solicitation, or offerors may have trouble exercising their right to exit the auction before it closes.
Using a third-party auction platform does not eliminate confidentiality obligations; agencies must still control what information the provider can see and release.
A reverse auction with only one offer may not provide the intended competitive benefit, so the Government may cancel rather than proceed with a noncompetitive result.
Official Regulatory Text
As prescribed in 17.805 (a) , insert the following provision: Reverse Auction (Aug 2024) (a) Definitions. As used in this provision— Reverse auction means the process for obtaining pricing, usually supported by an electronic tool, in which 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)