The recent rewrite of the Federal Acquisition Regulation (FAR) Part 6—governing “Competition Requirements”—is prompting questions about whether the changes may signal a shift in federal small business contracting policy. In particular, the removal of explicit references to certain socioeconomic program provisions raises concerns in the small business community. In this blog, PilieroMazza dissects the FAR Part 6 rewrite, concluding that most revisions appear to be structural rather than substantive. However, the unresolved status of the “Rule of Two” continues to raise concerns regarding the protection of small business set-aside opportunities.
A. The Rule of Two: Why Statutory Codification Is Essential
As most federal contractors are well aware, the FAR Overhaul is well underway, with an overarching goal of eliminating regulations that are not explicitly grounded in statutory authority. While we have yet to see the revised FAR Part 19—which currently houses the “Rule of Two”—the recent rewrite of FAR Part 6 reinforces the FAR Council’s intent to retain only those requirements that are explicitly mandated by statute.
Under the current FAR Part 19, the Rule of Two requires agencies to set aside contracts for small businesses when, based on market research, the contracting officer reasonably expects to receive offers from at least two responsible small businesses and that award can be made at fair market prices. Contracting officers are further required to first consider set-asides for specific socioeconomic programs—such as 8(a), HUBZone, Service-Disabled Veteran-Owned, and Woman-Owned Small Businesses—before considering a general small business set-aside.
However, this requirement is not currently codified by statute for acquisitions above the simplified acquisition threshold. As a result, there is ongoing concern that this critical small business safeguard may be omitted from the forthcoming FAR Part 19 rewrite.
B. FAR Part 6 Rewrite
Overall, FAR Part 6 remains largely unchanged in substance, though its language was condensed and streamlined. This is unsurprising, as many of the provisions in Part 6 were already codified by statute. However, the revisions do eliminate certain non-statutory provisions, reinforcing the FAR Council’s intent to retain only those requirements explicitly required by statute. Below is a summary of the key changes introduced in the updated Part 6.
1. Continued Discretion in Set-Asides
While the rewrite’s emphasis on contracting officer discretion raised concerns among small businesses, FAR Part 6 has long reflected this discretionary framework with respect to set-aside decisions. For example, former FAR 6.203(a) stated that contracting officers may set aside solicitations to fulfill small business requirements, with FAR 6.203(c) directing readers to FAR Part 19 for further guidance. The revised FAR 6.102-2(b) consolidates these points and similarly states: “Contracting officers may set aside acquisitions for small business concerns. This authority also includes—Contract actions set aside for specific small business socioeconomic categories (see part 19).” The continued use of the word “may” reaffirms that this discretion remains unchanged. Accordingly, the emphasis on discretion in the Practitioner Album likely reflects this long-standing principle rather than signaling a shift in policy.
2. Socioeconomic Programs in Other-Than-Full-and-Open Competition—Consolidated, Not Removed
A primary concern for many is the removal of detailed references to specific socioeconomic programs in revised FAR 6.103-5. The prior provisions, at FAR 6.302-5(b), expressly listed the specific socioeconomic programs (e.g., 8(a), HUBZone, SDVOSB, ED/WOSB) under which agencies could award contracts without full and open competition. The new FAR 6.103-5(b) removes this list, instead stating: “This authority may be used when statutes expressly authorize or require that acquisition be made from a specified source or through another agency. Examples include, but are not limited to: (1) Sole-source awards of certain socio-economic small business concerns …” While less detailed, this language still references sole-source awards to socioeconomic small businesses. When read in conjunction with the cross-reference to FAR Part 19 in FAR 6.102, PilieroMazza interprets this as a consolidation of authorities—not a scaling back of programs. The specific authorities are expected to remain detailed in FAR Part 19. However, only the forthcoming rewrite of FAR Part 19 will provide full confirmation.
3. Clarifications in the Practitioner Album
The Practitioner Album—a sidecar guide to the rewrite—categorizes content removed from FAR Part 6 in two ways:
– “Addressed in non-regulatory resources”
– “Deleted: Content that is outdated, redundant, or otherwise unnecessary”
Category 1 appears to identify and explain provisions removed entirely from the FAR system, whereas Category 2 addresses provisions removed only from FAR Part 6 but to be covered in another FAR Part. The Practitioner Album places the small business set-aside language in Category 2: “The list of specific small business socioeconomic categories was removed and replaced with a reference to FAR Part 19.” This strongly suggests that while specifics were removed from Part 6, they remain (or will be) addressed in FAR Part 19.
4. Removal of Non-Statutory Language: Justification and Approvals (J&As)
Previously, FAR 6.204–6.207 explicitly stated that J&As were not required for set-asides. That language has been removed. However, the revised FAR 6.104 confirms that J&As are only required under FAR 6.103 (i.e., other-than-full-and-open competition). Since set-asides do not fall under this category, J&As are still not required.
The revised rule also changes the J&A requirements for sole-source awards. Previously, J&As were required for any sole-source award under any socioeconomic program, except 8(a) sole-source awards under $25 Million. Under the revised rule, only 8(a) sole-source awards exceeding $25 Million require a J&A, reflecting a statutory requirement established by the National Defense Authorization Act for Fiscal Year 2010. Other J&As are not mandated by statute so long as such awards are authorized under other laws and regulations. If there is no specific sole-source authority, then a J&A will always be required.
C. Takeaways
- FAR Part 6 Rewrite Confirms Removal of Non-Statutory Provisions. The rewrite primarily reflects a reorganization and streamlining of content rather than a substantive policy change, as most competition requirements and exceptions are already codified by statute. Nonetheless, it underscores the FAR Council’s deliberate removal of non-statutory provisions.
- Rule of Two Removal Remains a Concern. Protect Small Business Opportunities: The “Rule of Two” Faces Potential Elimination highlighted H.R. 2804—The Protecting Small Business Competitions Act of 2025—which, among other provisions, seeks to make the Rule of Two a mandatory requirement for all federal agencies. While the deadline to sign the support letter passed, you can still contact your representatives to emphasize the importance of passing H.R. 2804 to protect small business contractors and urge them to vote in favor of the bill.
- Contact the House Small Business Subcommittee on Contracting and Infrastructure. As detailed in UPDATE: Let Your Voice be Heard: Congress Wants to Hear from Small Business Government Contractors, the Subcommittee postponed its hearing titled “Leveling the Playing Field: Fostering Opportunities for Small Business Contractors” to September. This delay provides small businesses with additional time to submit a letter of concern to the Subcommittee.
- FAR Part 19 Will Confirm. The upcoming release of revised FAR Part 19 will be critical to confirming how specific socioeconomic programs are treated going forward.
PilieroMazza continues to monitor the latest impacts of the Revolutionary FAR Overhaul. If you have any questions related to the FAR Part 6 rewrite, the “Rule of Two,” or other government contracting matters, please contact Cy Alba, Krissy Crallé, or another member of PilieroMazza’s Government Contracts Group. Also, visit our Government Contract Executive Orders resource center for additional coverage.
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If you’re seeking practical insights to gain a competitive edge by understanding the government’s compliance requirements, tune into PilieroMazza’s podcasts: GovCon Live!, Clocking in with PilieroMazza, and Ex Rel. Radio.
