FAR 7.3—Subpart 7.3

[Reserved]

Definitions.

FAR 7.301 is a cross-reference provision that tells readers where to find the operative definitions for the A-76 commercial activities subpart, especially the definition of "inherently governmental activity" and other related terms. Rather than restating those definitions in the FAR text, this section incorporates them by reference to Attachment D of OMB Circular No. A-76 (Revised), dated May 29, 2003. In practice, this means agencies, contracting officers, and contractors must consult the Circular itself when determining whether work may be performed by federal employees or contracted out, and when applying the commercial activities procedures in this subpart. The section matters because the definitions drive the threshold questions in A-76 analysis: what work is inherently governmental, what work is commercial, and what terms control the competition or sourcing decision. It also signals that the FAR text here is not self-contained, so users must read the incorporated OMB definitions to apply the subpart correctly and avoid misclassifying work.

Policy.

FAR 7.302 states the Government’s basic policy for deciding what work must stay in-house and what work may be competed with private-sector performance. It covers two central ideas: first, inherently governmental activities must be performed by Government personnel; second, commercial activities should be exposed to competition rather than automatically assigned to either agency staff or contractors. The section also explains how agencies must conduct public-private competitions under OMB Circular A-76 and, where applicable, the FAR, including how to weigh cost in performance decisions, how to treat the Agency Tender Official in GAO protest practice, and how to handle contests under the Circular. Finally, it adds a special rule for sealed bidding in A-76 competitions: contracting officers may not use discussions to cure deficiencies. In practice, this section is the policy foundation for sourcing decisions, competition procedures, protest rights, and the limits on contractor involvement in governmental functions.

[Reserved]

[Reserved]

Solicitation provisions and contract clause.

FAR 7.305 tells contracting officers which solicitation provisions and contract clauses must be used when an agency is conducting a public-private competition under the FAR Part 7 competition framework. It covers three specific items: the provision at 52.207-1, Notice of Standard Competition; the provision at 52.207-2, Notice of Streamlined Competition; and the clause at 52.207-3, Right of First Refusal of Employment. In practice, this section ensures that offerors are told what kind of competition is being run and, where work may move from in-house performance to contractor performance, that affected government employees receive the required employment notice and opportunity protections. The rule is mandatory, not discretionary, for the solicitations described, and it applies both to the solicitation and, for the right-of-first-refusal clause, to the resulting contract. The section also gives the contracting officer limited flexibility to adjust the 10-day response period in the employment clause, but only up to 90 days. Overall, this provision is about transparency in competition and protecting employees when work is converted from government performance to contract performance.