If a company has one or more Organizational Conflicts of Interest (“OCIs”), its ability to compete for (and perform) a government contract in a fair and equitable manner is inherently called into question. In the context of a bid protest, this may be one of the most overlooked but “sharpest” grounds that may be available to a protester. In short, an OCI is an instance where “because of other activities or relationships with other persons [or entities], a person [or entity] is unable or potentially unable to render impartial assistance or advice to the Government, or the person’s objectivity in performing the contract work is or might be otherwise impaired, or a person has an unfair competitive advantage.” FAR 2.101. Understanding the three types of OCIs and the situations in which each typically arises is critical in order for disappointed offerors to execute this riposte in the face of a flawed contract award.
Pursuant to FAR Subpart 9.5, agencies are required to investigate whether actual (or potential) OCIs may impact a procurement and take steps—often with the assistance of the potentially conflicted contractor—to mitigate or effectively neutralize such conflicts as early as possible in the acquisition process. Indeed, an OCI protest decision typically turns on the reasonableness of the agency contracting officer’s OCI investigation; that is, so long as the contracting officer has investigated the existence of a potential OCI and, in the event a potential OCI exists, reasonably determined whether the conflict has been adequately mitigated (or waived), the General Accountability Office (“GAO”) will likely defer to the contracting officer’s findings.
Although agencies have broad discretion when evaluating potential OCIs, that discretion isn’t unlimited. The recent decision in Steel Point Solutions, LLC, B-419709 et al., July 7, 2021 (“Steel Point”), underscores this point. In this case, the GAO sustained the protest on the ground that the agency failed to adequately consider the extent of potential OCIs arising from the awardee’s ongoing performance of two other agency contracts. This decision not only illustrates what an agency must consider for a proper OCI analysis and mitigation but also serves as another real-world example of when OCIs may arise—in this case, an “impaired objectivity” OCI.
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