Link: GAO Opinion
Agency: Department of the Army
Disposition: Protest denied.
Agency properly excluded protester from competition where, although firm’s ineligibility may not have been clear from solicitation, agency had statutory authority to limit competition and executed determination and finding citing that authority, making it clear that it intended to limit competition in a manner that excluded protester; GAO will not recommend that agency undertake useless act of amending solicitation to make clear that protester is ineligible to compete.
General Counsel P.C. Highlight:
During the course of the procurement, the agency determined to limit competition as provided for under the National Defense Authorization Act for Fiscal Year 2008, Public Law, P.L. 110-181. As relevant here, section 886 of the Act states that, for products or services to be acquired in support of military operations or stability operations in Iraq or Afghanistan, the Secretary of Defense may determine that it is in the national security interest of the United States to limit competition, use procedures other than competitive procedures, or provide a preference because such limitation, procedure, or preference is necessary to provide a stable source of jobs in Iraq or Afghanistan and will not adversely affect military operations or stability operations in Iraq or Afghanistan. The Army prepared a determination and finding (D&F) to support its decision to meet the requirement through limited competition. The D&F states that the acquisition will be conducted under section 886 and that other than competitive procedures will be used to award a contract to a particular source or sources from Iraq or Afghanistan. The D&F also states, among other things, that using the described procedures is necessary to provide a stable source of jobs in Iraq, lists Iraqi sources that expressed interest in the solicitation, and states that, to implement the limited competition, the solicitation will contain DFARS sect. 252-225-7026, Acquisition Restricted to Products or Services from Iraq or Afghanistan. The solicitation, issued on February 17, contained this clause, which states that the contractor shall provide only products or services from Iraq (as defined in section 886(c)(1) and (2)). The Army provided the solicitation to several firms, but not to the protester because it was aware that KLG is not an Iraqi company, but a Kuwaiti company based in Kuwait.
KLG argues that it should have been permitted to compete under the RFP. In this regard, KLG cites the language of DFARS sect. 252-225-7026, included in the solicitation, which requires only that contractors use services or products from Iraq or Afghanistan in the performance of a contract, not that the contractor be an Iraqi company. KLG also contends that the statutory language “a particular source or sources from Iraq” should be read to include firms operating in Iraq. KLG concludes that, since it operates in Iraq and intends to utilize Iraqi products and services, it meets the requirements of DFARS sect. 252-225-7026, and thus should be permitted to compete.
GAO agrees with the protester that the language in the solicitation does not expressly exclude non-Iraqi firms from competing; the only provision incorporated in the solicitation to limit competition–DFARS sect. 252-225-7026–requires that the contractor provide Iraqi products and services, but does not address the origin of the contractor. This conclusion notwithstanding, GAO finds no basis to object to the agency’s actions, since it finds that the Act confers authority to limit competition to Iraqi companies, and the record shows that the agency intended to do so. In this regard, as noted, under the Act, a source is from Iraq if it is located in Iraq. The agency interprets this language as referring only to Iraqi companies, and GAO agrees with this interpretation. First, it is consistent not only with the plain language of the Act, but also with its underlying purpose–because of its permanent connection to Iraq, an Iraqi company reasonably may be viewed as more likely than a non-Iraqi company to provide a stable source of jobs in Iraq. Moreover, the protester’s alternative interpretation–that from Iraq and located in Iraq refer to sources operating in Iraq–is based on a term–operating–that does not appear in the Act. If this was the intent underlying the Act, it easily could have been expressed by use of this term or other similar language. Accordingly, GAO concludes that the agency properly determined that KLG is ineligible to compete because it is not a source from Iraq. Requiring the agency to amend the solicitation to make KLG’s exclusion clearer would serve no purpose; KLG would remain ineligible for award. The protest is denied.