FAR 9.406-1—General.
Plain-English Summary
FAR 9.406-1 explains the general principles that govern debarment decisions. It covers the suspending and debarring official’s discretion to decide whether debarment is in the Government’s interest, the fact that a cause for debarment does not automatically require exclusion, and the factors the official should weigh in deciding whether a contractor is presently responsible. Those factors include internal controls and standards of conduct, self-disclosure, cooperation with investigations, payment of liability and restitution, disciplinary action, remedial measures, training, time to correct problems, management’s recognition of misconduct, prior history and pattern of wrongdoing, the extent and pervasiveness of the misconduct, tolerance by principals, prior exclusions or disqualifications, prior administrative agreements, and any other relevant circumstances. The section also explains that the contractor bears the burden of showing present responsibility once a debarment cause exists. In addition, it addresses the scope of debarment across divisions, organizational elements, and affiliates, and states that debarment generally applies throughout the executive branch unless an agency head or designee documents compelling reasons to continue doing business. Finally, it begins the rule for debarment authority that may cover both FAR procurements and Federal personal property transactions, signaling that debarment can have broad governmentwide consequences in practice.
Key Rules
Debarment Is Discretionary
The suspending and debarring official decides whether debarment is in the Government’s interest. Even when a cause exists under FAR 9.406-3, debarment is not automatic; the official must consider the seriousness of the conduct and any mitigating or aggravating circumstances.
Present Responsibility Matters
The core question is whether the contractor is presently responsible. The official should evaluate whether the contractor has corrected the problem, implemented controls, and demonstrated that future misconduct is unlikely.
Mitigation and Remediation Count
The official should consider internal controls, self-disclosure, cooperation, restitution, discipline, remedial measures, training, and management commitment to compliance. These factors can reduce the need for debarment, but they do not guarantee avoidance of exclusion.
Contractor Bears the Burden
If a debarment cause exists, the contractor must persuade the suspending and debarring official that debarment is unnecessary and that the contractor is presently responsible. The existence or absence of mitigating factors is not by itself determinative.
Debarment Can Reach Affiliates
A debarment generally covers all divisions and organizational elements of the contractor unless the decision is limited by its terms. Affiliates may also be included if they are specifically named and given written notice and an opportunity to respond.
Governmentwide Effect
A debarment or proposed debarment applies throughout the executive branch unless an agency head or designee documents compelling reasons to continue business with the contractor. This makes debarment a broad, cross-agency exclusion tool.
Other Relevant Factors Allowed
The official may consider any other circumstances appropriate to the case, including prior exclusions, similar state or local actions, administrative agreements, the extent of planning or participation in the wrongdoing, and whether the misconduct was pervasive or tolerated by leadership.
Responsibilities
Suspending and Debarring Official
Determine whether debarment is in the Government’s interest; evaluate the seriousness of the misconduct and all relevant mitigating, aggravating, and remedial factors; decide whether to limit the scope of debarment; and ensure affiliates are named and given notice before being included.
Contractor
Demonstrate present responsibility if a debarment cause exists; provide evidence of internal controls, self-disclosure, cooperation, restitution, discipline, training, and other corrective actions; and show that debarment is not necessary.
Contractor Management
Recognize and accept the seriousness of the misconduct; implement programs to prevent recurrence; ensure effective standards of conduct and internal controls; and take disciplinary and remedial action where appropriate.
Individuals Subject to Debarment Consideration
Cooperate with investigations and proceedings; attend relevant remediation training when applicable; and show understanding of the misconduct and adoption of practices to prevent recurrence.
Agency Head or Designee
If continued dealings are justified despite a debarment or proposed debarment, provide a written statement of compelling reasons for that agency to continue business with the contractor.
Federal Agencies
Treat debarment as governmentwide across the executive branch unless an exception is properly documented; consider prior exclusions, disqualifications, and similar administrative agreements when evaluating responsibility and risk.
Practical Implications
A debarment cause does not end the analysis; contractors should be prepared to prove corrective action and present responsibility quickly and with documentation.
Strong compliance programs matter before a problem occurs. Effective internal controls, ethics training, and reporting systems are key evidence against debarment.
Self-disclosure and cooperation can be important mitigating factors, but they do not erase misconduct or guarantee a favorable outcome.
Debarment can affect more than one business unit and may extend to affiliates, so corporate structure and ownership relationships matter.
Because debarment is generally governmentwide, a contractor can lose access to opportunities across agencies unless a narrow written exception applies.
Official Regulatory Text
(a) It is the suspending and debarring official's responsibility to determine whether debarment is in the Government's interest. The suspending and debarring official may, in the public interest, debar a contractor for any of the causes in 9.406-3 . The existence of a cause for debarment, however, does not necessarily require that the contractor be debarred; the seriousness of the contractor's acts or omissions and any remedial measures, mitigating factors, or aggravating factors should be considered in making any debarment decision. Before arriving at any debarment decision, the suspending and debarring official should consider factors such as the following (some of the factors below could apply to individuals such as contractors that are individuals, and are so marked): (1) Whether the contractor had effective standards of conduct and internal control systems in place at the time of the activity which constitutes cause for debarment or had adopted such procedures prior to any Government investigation of the activity cited as a cause for debarment. (2) Whether the contractor (including an individual) brought the activity cited as a cause for debarment to the attention of the appropriate Government agency in a timely manner. (3) Whether the contractor has fully investigated the circumstances surrounding the cause for debarment (or the individual cooperated with the investigation) and, if so, made the result of the investigation available to the suspending and debarring official. (4) Whether the contractor (including an individual) cooperated fully with Government agencies during the investigation and any court or administrative action. (5) Whether the contractor (including an individual) has paid or has agreed to pay all criminal, civil, and administrative liability for the improper activity, including any investigative or administrative costs incurred by the Government, and has made or agreed to make full restitution. (6) Whether the contractor has taken appropriate disciplinary action against the individuals responsible for the activity which constitutes cause for debarment. (7) Whether the contractor (including an individual) has implemented or agreed to implement remedial measures, including any identified by the Government. (8) (i) Whether the contractor has instituted or agreed to institute new or revised review and control procedures, ethics training, or other relevant training programs. (ii) For an individual, whether the individual has attended relevant remediation training. (9) Whether the contractor (including an individual) has had adequate time to eliminate the circumstances that led to the cause for debarment. (10) (i) Whether the contractor's management recognizes, accepts, and understands the seriousness of the misconduct giving rise to the cause for debarment and has implemented programs to prevent recurrence. (ii) For an individual, whether the individual recognizes, accepts, and understands the seriousness of the misconduct giving rise to the cause for debarment and has adopted practices to prevent recurrence. (11) Whether the contractor (including an individual) has a pattern or prior history of wrongdoing, the frequency of incidents and/or duration of the wrongdoing, and the actual or potential harm or impact that results, or may result, from the wrongdoing. (12) Whether and to what extent the contractor (including an individual) planned, initiated, or carried out the wrongdoing, and the kind of positions within the contractor's organization held by the individual involved in the wrongdoing. (13) Whether the wrongdoing was pervasive within the contractor's organization. (14) Whether the individual or the contractor's principals tolerated the offense. (15) Whether the contractor (including an individual) is or has been excluded or disqualified by an agency of the Federal Government or has not been allowed to participate in State or local contracts or assistance agreements on a basis of conduct similar to one or more of the causes for debarment specified in this subpart. (16) Whether the contractor (including an individual) has entered into an administrative agreement with a Federal agency or a similar agreement with a State or local government that is not Governmentwide but is based on conduct similar to one or more of the causes for debarment specified in this subpart. (17) Whether there are any other factors to consider for the contractor (including an individual) appropriate to the circumstances of a particular case. (b) The existence or nonexistence of any aggravating or mitigating factors or remedial measures such as set forth in paragraph (a) of this section is not necessarily determinative of a contractor's present responsibility. Accordingly, if a cause for debarment exists, the contractor has the burden of demonstrating, to the satisfaction of the suspending and debarring official, its present responsibility and that debarment is not necessary. (c) Debarment constitutes debarment of all divisions or other organizational elements of the contractor, unless the debarment decision is limited by its terms to specific divisions, organizational elements, or commodities. The suspending and debarring official may extend the debarment decision to include any affiliates of the contractor if they are— (1) Specifically named; and (2) Given written notice of the proposed debarment and an opportunity to respond (see 9.406-3 (c)). (d) A contractor's debarment, or proposed debarment, shall be effective throughout the executive branch of the Government, unless the agency head or a designee (except see 26.505 (e)) states in writing the compelling reasons justifying continued business dealings between that agency and the contractor. (e) (1) When the suspending and debarring official has authority to debar contractors from both contracts pursuant to the Federal Acquisition Regulation in this chapter and contracts for the purchase of Federal personal property pursuant to the Federal Management Regulation (FMR) in 41 CFR part 102-38, that official shall consider simultaneously debarring the contractor from the award of acquisition contracts and from the purchase of Federal personal property. (2) When debarring a contractor from the award of acquisition contracts and from the purchase of Federal personal property, the debarment notice shall so indicate and the appropriate FAR and FMR citations shall be included.