Friday morning, May 20, 2016, the Department of Defense, the General Services Administration, and NASA issued a proposed rule to clarify that prospective government contractors must register with the System for Award Management (SAM) prior to submitting a proposal. A contractor cannot wait until the time of award to register. Interested parties should submit written comments to the Regulatory Secretariat Division on or before July 19, 2016 in order to be considered in the formation of the final rule.

If a company is contemplating submitting a proposal for a contract to the federal government, the time to register the company with SAM1 is now. SAM is an online portal where companies can register themselves in order to do business with the government.

SAM serves multiple purposes in the field of government contracting. It is a single portal where contracting officers can access a variety of information about current and potential contractors, and it increases visibility of vendors for specific supplies and services to the government.2 It allows contractors to submit important Online Representations and Certifications Applications, and provides contracting officers with a single database to determine whether entities are prohibited from contracting with the government because of suspensions or debarments.3 Registration, even without planning on contracting with the government, can have added benefits. In responding to natural disasters, the Federal Emergency Management Agency (FEMA) often needs to acquire a variety of goods and services on a very short-term basis. A company, when registering with SAM, can also complete a Disaster Response Registry. Contracting officers are required to consult the Disaster Response Registry when determining the "availability of contractors for debris removal, distribution of supplies, reconstruction, and other disaster or emergency relief activities[.]"4

The Federal Acquisition Regulation's policy for registration with SAM currently provides, with certain exceptions, that contractors must register "prior to award of a contract or agreement[.]"5 By contrast, certain clauses included in government contract solicitations require that a potential contractor represent that it has already registered with SAM at the time it submits a proposal.6

Due to the resulting confusion, the Department of Defense, the General Services Administration, and NASA have issued a proposed rule to clarify that "[p]rospective contractors shall be registered in the SAM database at the time an offer or quote is submitted[.]"7 The proposed rule would also require contracting officers to verify that prospective contracts are registered in SAM "at the time of offer or quote submission[.]"8

Registering with SAM is a free and relatively straightforward process through www.sam.gov. If a company is considering contracting with the federal government, it should also consider whether it wants to register with SAM now, rather than waiting until a rush to submit a proposal or, worse, attempting to register after proposals are due.