Organizational conflict of interest and FAR 9.5

An organizational conflict of interest (OCI) arises when a contractor's other interests threaten impartial judgment or create unfair competitive advantage. Federal Acquisition Regulation (FAR) Subpart 9.5 addresses conflicts affecting current work and future acquisitions. (FAR 9.502 and 9.505)

Identify the conflicting role, information, or financial interest before choosing a remedy. A general ethics policy does not explain how a particular conflict will be controlled.

What are the 3 types of OCI?

The Government Accountability Office (GAO) groups OCI concerns into biased ground rules, impaired objectivity, and unequal access to information. (Systems Made Simple, B-412948.2)

These categories describe different mechanisms. Map each concern to the actual work and relationships rather than applying one label to everything.

GAO's Systems Made Simple decision also distinguishes supported allegations from suspicion. The question is what the contractor actually did, accessed, or stood to gain. Keep records that permit that analysis.

What FAR 9.5 says after the overhaul

The Revolutionary FAR Overhaul (RFO) retains OCI provisions in Subpart 9.5. Section 9.504(a) still requires early identification and evaluation, followed by avoiding, neutralizing, or mitigating significant potential conflicts before award. (RFO Part 9)

The published versions need to be distinguished:

DoD's deviation directs use of RFO Part 9 and its attached DFARS 209 text. The attachment retains 209.571. (DoD Part 9 deviation)

The September 18, 2026 Federal Register document for RFO Parts 9, 27, and 47 is a proposed rule. A proposal is distinct from an adopted agency deviation or a final codified amendment. (FAR Case 2026-011)

What does avoid, neutralize, or mitigate mean?

Choose a control that addresses the source of the conflict. The National Aeronautics and Space Administration (NASA) guide explains several approaches, rather than one universal cure. (NASA OCI Guide, chapter 2)

Start by identifying what must change. If the concern involves access to protected information, control access and use. If it involves financial incentives, examine ownership and work assignments.

Ask whether the proposed remedy still works when employees transfer, a subcontractor changes, or a new opportunity appears. Put those cases into the review process before approving the arrangement.

Can a firewall fix an OCI?

A firewall may address information flow, but it does not automatically remove a financial incentive. Match the barrier to the conflict.

In Leidos, GAO found that separating personnel did not remove an organization's shared financial interests. The decision also recognized arrangements involving a separate entity and a firewall as possible mitigation in appropriate circumstances. (Leidos, B-417994)

Therefore, avoid both absolute claims: that firewalls always solve impaired objectivity, or that they can never contribute to a solution. Explain the remaining incentive after the proposed separation.

Biased ground rules require their own analysis. In The LEADS Corporation, GAO explained why information barriers alone did not resolve that concern. Work assignments that kept conflicted personnel away from affected matters were part of the broader approach. (The LEADS Corporation, B-292465)

For an information barrier, identify the protected material, permitted users, prohibited uses, and access controls. Then identify who checks compliance. A diagram of separate teams is a starting point, not the complete explanation.

What an OCI mitigation plan should contain

An OCI mitigation plan should connect each identified conflict to a specific control and accountable owner. NASA's sample provides a practical checklist, not a mandatory governmentwide form. (NASA OCI Guide, Appendix B)

1. Describe the facts. Name the affected contracts, activities, entities, personnel, and information.
2. Explain the conflict. Identify the judgment or competitive advantage at risk.
3. Assign controls. State what each control prevents and who operates it.
4. Cover affiliates and subcontractors. Identify their roles and required commitments.
5. Set oversight. Describe training, reporting, audits, records, and consequences for violations.
6. Require updates. Define the events that trigger reassessment and approval of changes.

Write the plan so someone can test it. For example, replace an instruction to keep information separate with named repositories and authorized roles.

Keep a control register with a responsible person, implementation date, review date, and evidence location. Use it to track whether promised measures exist in practice.

Include a process for unexpected access. Name who receives the report and who decides whether affected work should continue. Adapt the response to the agency's contract terms and instructions.

When DFARS 209.571 matters

DFARS 209.571 adds rules for major defense acquisition programs. It does not govern every defense contract. (DFARS 209.571-2)

The provisions address objective advice, competition, affiliated business units, and subcontract relationships. Section 209.571-7 also addresses specified work on pre-major defense acquisition programs. When the parties agree to a government-approved mitigation plan, 209.571-4(b) requires incorporating it into the contract.

The DoD deviation retains these provisions. It also retains restrictions in 209.571-7 involving systems engineering and technical assistance contractors and affiliates. That restriction cannot be waived; paragraph (c) provides a separate exception. (DoD deviation, Attachment A1)

Before proposing controls, check whether a specific restriction applies to the contemplated follow-on work. A general mitigation discussion cannot replace that determination.

How to raise an OCI concern

Raise the facts early enough for the contracting officer to evaluate them before award. FAR 9.504 places the analysis and resolution responsibility with the contracting officer. (FAR 9.504)

Prepare a short disclosure identifying the relationships, affected activities, and proposed controls. Attach supporting records instead of relying on assurances.

For information-related concerns, map what was accessible and who received it. The procurement information guide explains related information categories. The source selection decision guide covers the separate award-decision record.

What to do next

• Map current work, affiliates, subcontractors, and planned competitions.
• Identify which OCI mechanism each fact could create.
• Check FAR 9.5 and the applicable agency deviation.
• Test whether each proposed control removes the identified risk.
• Assign plan owners and retain implementation evidence.

Azcuna's LEDGER turns a trade study into a Decision Package in which every number cites its source and AI agents draft but never decide. It was proposed to the Army under SBIR Phase I topic ARM26BX06-NV012, and the proposal was submitted on October 21, 2026.

Questions people ask

What is an organizational conflict of interest?

An organizational conflict of interest involves other interests that threaten impartial judgment or create unfair competitive advantage. FAR 9.5 covers conflicts affecting current contract performance and future acquisitions. The contracting officer evaluates the facts and addresses significant potential conflicts before award.

What are the 3 types of OCI?

GAO decisions describe biased ground rules, impaired objectivity, and unequal access to information. These concern shaping a competition, providing advice affected by competing interests, and possessing competitively useful nonpublic information. A situation can require analysis of more than one category.

Can a firewall mitigate impaired objectivity?

A firewall alone may leave the organization's financial incentive unchanged. GAO's Leidos decision explains that problem while recognizing that a separate entity and information barriers can contribute to mitigation in appropriate circumstances. The remedy must address the specific competing interest.

Does an OCI mitigation plan become part of the contract?

For covered major defense acquisition programs, DFARS 209.571-4(b) requires incorporating an agreed, government-approved mitigation plan into the contract. That provision has a defined scope. Other acquisitions require checking their applicable solicitation provisions, agency rules, and contract terms.

Sources

1. 1Subpart 9.5 - Organizational and Consultant Conflicts of Interest · Federal Acquisition Regulatory Council, Acquisition.gov
2. 2Systems Made Simple, Inc., B-412948.2, July 20, 2016 · U.S. Government Accountability Office
3. 3FAR Overhaul - Part 9 · Federal Acquisition Regulatory Council, Acquisition.gov
4. 4Class Deviation 2026-O0042, RFO Part 9 and DFARS Part 209 · Defense Pricing, Contracting, and Acquisition Policy
5. 5Federal Acquisition Regulation: Revolutionary FAR Overhaul Parts 9, 27, and 47, proposed rule, September 18, 2026 · Federal Acquisition Regulatory Council, Federal Register
6. 6NASA Guide on Organizational Conflicts of Interest, March 2010 · National Aeronautics and Space Administration
7. 7Leidos, Inc., B-417994, December 17, 2019 · U.S. Government Accountability Office
8. 8The LEADS Corporation, B-292465, September 26, 2003 · U.S. Government Accountability Office
9. 9Subpart 209.5 - Organizational and Consultant Conflicts of Interest · Department of Defense, Acquisition.gov

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