When you’re new to government contracting, the sheer volume of regulations and acronyms can feel like learning a new language. Among the first you’ll encounter are FAR and DFARS—two foundational sets of rules that govern how the government buys goods and services.

This guide will demystify these regulations, explaining what they are, who they apply to, and why they are so important for your business.

What is the FAR? (The “Bible” of Federal Procurement)

FAR stands for the Federal Acquisition Regulation. It is a comprehensive, government-wide set of rules that apply to virtually all federal executive agencies. Think of the FAR as the “constitution” for government purchasing—it establishes the uniform policies and procedures for acquiring supplies and services with appropriated funds.

Key things to know about the FAR:

• Universal Application: If you are doing business with a federal agency, from the Department of Education to the Department of Energy, your contract will be governed by the FAR.
• Purpose: The FAR’s purpose is to ensure fairness, transparency, and integrity in the procurement process. It aims to deliver the best value to the taxpayer while also fulfilling public policy objectives, such as promoting small business participation.
• Structure: The FAR is a massive document, divided into 53 parts. These parts cover everything from acquisition planning and contract types to labor laws and subcontracting. Your contract will explicitly reference the relevant FAR clauses that apply to your specific work.
• Compliance is Mandatory: Every contractor, regardless of size, must comply with the FAR clauses included in their contract. Failure to do so can result in contract termination, financial penalties, or even being debarred from future government work.

What is DFARS? (The DoD’s Supplement to the FAR)

DFARS stands for the Defense Federal Acquisition Regulation Supplement. As the name suggests, it is an extension of the FAR, but it applies specifically to the Department of Defense (DoD) and its contractors.

Because the DoD’s needs often involve national security and highly sensitive information, DFARS adds an extra layer of requirements that are not covered by the broader FAR.

Key things to know about DFARS:

• DoD-Specific: If you are pursuing a contract with the Air Force, Army, Navy, or any other DoD component, you will be subject to both the FAR and the DFARS.
• Specialized Rules: DFARS contains additional regulations that address unique defense-related concerns, such as:

• Cybersecurity: DFARS mandates specific cybersecurity standards, particularly for protecting Controlled Unclassified Information (CUI). The famous NIST SP 800-171 standards are a key part of DFARS compliance.
• Intellectual Property: Rules for how the government can use and access a contractor’s intellectual property and technical data.
• Domestic Sourcing: Requirements like the “Buy American Act” and the “Berry Amendment” which place restrictions on sourcing certain materials from outside the United States.
• More Stringent: Generally, the DFARS is more specialized and often more stringent than the general FAR, reflecting the high-stakes nature of defense contracting.

The Key Differences: A Simple Analogy

Think of it this way:

• The FAR is the foundational traffic code that every driver (contractor) must follow on all roads (agencies).
• The DFARS is an additional set of rules for a specific type of road—a military base (DoD). On this base, you not only have to follow the general traffic code, but also a specific set of rules, like a special speed limit or a requirement to show your ID at the gate.

Why Do They Matter to You?

For any business venturing into government contracting, understanding these regulations is not just about compliance—it’s about success.

• It’s Not Commercial Business: The government is not a typical commercial customer. You cannot negotiate terms in the same way, and you must adhere to a vast body of rules designed to protect the public interest.
• Proposal Compliance: Your proposal must demonstrate that you understand and can comply with all of the FAR and DFARS clauses cited in the solicitation.
• Cost & Pricing: The FAR includes detailed cost principles that dictate which costs are “allowable” on a government contract. Understanding this is crucial for accurate pricing and invoicing.
• Risk Mitigation: A single misstep in compliance can lead to costly audits, contract disputes, or worse. Familiarizing yourself with these rules is your best defense against such risks.

Navigating the world of FAR and DFARS is a continuous learning process. Start by focusing on the clauses in your current or target solicitations, and don’t hesitate to seek out resources like your local APEX Accelerator or a government contracting consultant to ensure you’re on the right track.