Revolutionary FAR Overhaul Update: Rulemaking Phase Begins With The Issuance Of Four Proposed Rules

On June 23, 2026, the Revolutionary FAR Overhaul (“RFO”) officially entered the rulemaking phase of the overhaul process with the release of four separate proposed rules (the “Proposed Rules”). Collectively, the Proposed Rules cover 20 parts of the FAR (including Part 52, which contains related clauses and will be updated on an ongoing basis throughout the process). The Proposed Rules are available here: FAR Case 2026-001, FAR Case 2026-002, FAR Case 2026-005, and FAR Case 2026-007. Comments for all four Proposed Rules are due by July 23, 2026.

How Did We Get Here?

If you haven’t been paying attention to the RFO process, it’s OK – that’s what we’re here for. Here’s a quick recap.

On May 2, 2025, the Office of Management and Budget (“OMB”) launched the “Revolutionary FAR Overhaul” with Memo M-25-25 as the first step in implementing Executive Order (“EO”) 14275, Restoring Common Sense to Federal Procurement. With that, led by the Office of Federal Procurement Policy (“OFPP”) and the Federal Acquisition Regulatory Council (“FAR Council”), the government began the process of overhauling (or rewriting) the FAR to “return the FAR to its statutory roots, rewrite it in plain language, and remove most non-statutory rules.”

The first phase of the RFO process involved revising all 53 FAR parts via “model deviations” drafted by the FAR Council. Once the model deviations were published on the acquisition.gov website (note, not formally published in the Federal Register), all executive agencies had 30 days to implement the model deviations by issuing agency class deviations. The agency deviations adopted the model deviations, making them applicable by agency.¹ Our analysis of the deviations is available in our FAR Overhaul Tracker. Once adopted by agencies, the language in the deviations became effective as a temporary stopgap while the FAR Council considered feedback (nearly 1,600 comments) and began the process of drafting proposed rules.

Where Are We Now?

With the June 23, 2026 publication in the Federal Register, we’ve now entered Phase 2 of the overhaul process – the official rulemaking phase – where the FAR Council will eventually publish all FAR Parts as proposed rules, solicit feedback from industry, and then (we suppose) issue final rules. The FAR Council will release a series of 12 proposed rules in total, covering the entire FAR. As described in more detail below, each proposed rule will cover several FAR Parts. To its credit the FAR Council has published a useful resource, organized by proposed rule (i.e., FAR Case) that highlights major changes incorporated into the proposed rules based on feedback the FAR Council received in response to each FAR Part deviation. This resource will be updated continuously as the rulemaking continues.

The First Four Proposed Rules

So, what do these first four Proposed Rules cover? We’re glad you asked! Below we provide a high-level overview of what is covered in each Proposed Rule, and here’s a handy table:

FAR Case 2026-001, Covering Parts 1, 2, 4, 33, 39, 40 and 53 (and associated Part 52 clauses)²

This Proposed Rule covers the following FAR Parts:

• Part 1 – Federal Acquisition Regulations System
• Part 2 – Definitions and Acronyms
• Part 4 – Administrative and Information Matters
• Part 33 – Protests, Disputes, and Appeals
• Part 39 – Acquisition of Information and Communication Technology
• Part 40 – Information Security and Supply Chain
• Part 53 – [Removed and Reserved]

We will cover the more significant changes to each of these Parts in more detail in a subsequent blog post, but for now, the most significant substantive changes appear to be to Parts 1, 4, 33, and 40. In particular, Part 1 removed the “sunset clause” from the model deviation which made it so that all non-statutory FAR language automatically expired after four years. That concept is gone, and now language in the FAR can only be removed through formal rulemaking. Part 4 was revised to eliminate half of the previous information required for an entity to register on SAM.gov. The purpose of this change is to reduce administrative burden for current and prospective contractors and increase market entry by encouraging new entrants. Part 33 enhances agency-level protests by allowing the agency to disclose a redacted copy of the agency’s final technical evaluation of the protester’s proposal and a redacted copy of the source selection decision.

Finally, Part 40. This is a big one. Part 40 has been significantly expanded and reorganized into three subparts – Processing Supply Chain Risk Information, Security Prohibitions and Exclusions, and Safeguarding Information. It also incorporates seven open FAR cases / interim rules including those on (1) Controlled Unclassified Information; (2) Section 889 Part A; (3) Section 889 Part B; (4) Federal Acquisition Supply Chain Security Act (“FASCSA”); (5) Implementation of FASCSA Orders; (6) Prohibition on a ByteDance Covered Application (TikTok); and (7) Prohibition on Unmanned Aircraft Systems from Covered Foreign Entities (American Security Drone Act).

FAR Case 2026-002, Covering Parts 6, 7, 10, 18, 26, 37 and 41 (and associated Part 52 clauses)

This Proposed Rule covers the following FAR Parts:

• Part 6 – Competition Requirements
• Part 7 – Acquisition Planning
• Part 10 – [Removed and Reserved]
• Part 18 – [Removed and Reserved]
• Part 26 – Emergency Assistance and Other Socioeconomic Programs
• Part 37 – Service Contracting
• Part 41 – Acquisition of Utility Services

As above, we will cover the more significant changes to each of these Parts in more detail in a subsequent blog post. At a high level, the most significant substantive changes appear to be to Parts 6, 37, and 41. Part 6 updates rules for justification and approval requirements by removing some duplicative (and confusing) language, and significantly increasing the approval authorities for sole source awards such that DOD, NASA, and Coast Guard contracting officers can approve sole source awards up to $10M (contracting officers in other agencies can approve up to $900,000). Part 37 updates the definition of “service contract” to move away from “identifiable tasks” and toward “outcome-focused approaches” – essentially, a service contract is any contract in which the primary purpose of the contract is to obtain services. Part 41 updated the definition of “Utility Service” with additional clarifying language that specifically lists which items are not considered a “Utility Service.”

FAR Case 2026-005, Covering Parts 5, 24 and 29 (and associated Part 52 clauses)

This Proposed Rule covers the following FAR Parts:

• Part 5 – Publicizing Noncommercial Contract Actions
• Part 24 – Protection of Privacy and Freedom of Information
• Part 29 – Taxes

The revisions to these Parts are relatively minor by comparison to the other Proposed Rules. At a high level, Part 5 was revised to clarify that an agency official may announce significant contracting actions (i.e., over $5.5 million), but that this is distinct from the automatic posting requirement in Part 5.301. It also revises some outdated thresholds and removes references to the Simplified Acquisition Threshold as they relate to FAR Part 12 and the acquisition of commercial products and services (to eliminate confusion). Part 24 clarifies the scope of civil liability when contractors handle systems of record. Specifically, the language states that if an agency fails to require a contractor to operate a “system of records according to the Privacy Act” the agency “may be civilly liable” but that “[t]his provision does not apply to contractors performing design, development, or other activities that do not involve operating a system of records on behalf of the agency.” Part 29 has only minor changes from the text in the deviation.

FAR Case 2026-007, Covering Parts 3 and 49 (and associated Part 52 clauses)

This Proposed Rule covers the following FAR Parts:

• Part 3 – Improper Business Practices and Personal Conflicts of Interest
• Part 49 – Termination of Contracts

The changes to Part 3 were not major, but they do clarify procedures for revising markings on contractor bid and proposal information and source selection information to provide a “more coherent framework” and hopefully reduce errors associated with inconsistent review practices. The changes to Part 49 are a bit more substantive. For example, rather than requiring a mandatory audit for termination settlement proposals, the language now provides for a permissive risk-based approach. The proposed rule introduces aggressive reductions to the timeframes for contractors to submit post-termination documentation:

Contractors should pay close attention to these timeline revisions so they do not inadvertently miss these deadlines. Finally, the Proposed Rule clarifies that FAR Part 49 does not apply to contracts for commercial products or commercial services awarded under FAR Part 12 procedures. The termination procedures for commercial contracts remain governed by FAR Part 12.

Conclusion

The Revolutionary FAR Overhaul is a massive undertaking. While many of the revisions will not have a major impact on contractors (e.g., plain language edits, reorganization, streamlining, etc.), other changes will have major impacts. We will continue to follow this process closely, and all contractors should do the same. As a reminder, the comment period for the first four Proposed Rules closes July 23, 2026. The FAR Council appears to have closely considered the 1,600 comments it received in response to the model deviations during Phase 1, and we should expect it will do the same during the Phase 2 rulemaking stage. For every stakeholder in the federal acquisition ecosystem, now is the time to engage.

For additional guidance on FAR Overhaul developments, please review our latest blog posts here or visit our Revolutionary FAR Overhaul Tracker webpage.

*Rob Mobley is a summer associate in the firm's Washington D.C. office. 

Footnotes

1 As a sidenote, while we have never seen them used at this scale, agency deviations are not new. They are simply a formal authorization that allow an agency to bypass or modify specific procurement rules. As the name suggests, deviations allow the agency to deviate from the regulatory requirements. Here, the FAR Counsil used the agency-specific deviations to basically test out the rewritten FAR Parts before formally undergoing the regulatory process.

2 Part 52 includes the associated solicitation provisions and contract clauses and is therefore included in each part. It is not separately listed in the FAR Parts covered by each Proposed Rule.

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