FAR 2.0: A Transformative Rewrite of Federal Acquisition Regulation in 2025

The Federal Acquisition Regulation (FAR), the cornerstone of US government contracting, is undergoing a significant overhaul with the FAR 2.0 proposed initiative. This rewrite, spearheaded by the Office of Management and Budget’s (OMB) Office of Federal Procurement Policy (OFPP), aims to streamline and modernize the complex regulatory framework that governs federal acquisitions. The goal of the rewrite is to simplify the FAR by focusing on statutory mandates, eliminating redundant or nonessential provisions, and making federal contracting more accessible, particularly for new entrants and small businesses.

In this blog, we describe the status of the rewrite, its potential impacts, and what stakeholders should watch for as this transformative process unfolds. 

What Is “FAR 2.0”?

On April 15, 2025, President Trump issued Executive Order 14275, “Restoring Common Sense to Federal Procurement,” kicking off a comprehensive overhaul of the FAR. EO 14275 establishes direction “to create the most agile, effective, and efficient procurement system possible” and, most important, contain “only provisions required by statute or essential to sound procurement.”

The FAR, which spans thousands of pages and includes numerous clauses, has evolved over decades and contains layers of both statutory and nonstatutory requirements. FAR 2.0 seeks to pare down the regulations, potentially reducing compliance burdens and overhead costs for contractors. The rewrite also aims to align with the Trump administration’s broader deregulation agenda, emphasizing simplicity and business-friendly policies. The acquisition.gov site is referring the FAR 2.0 as the “Revolutionary FAR Overhaul.” For purposes of this article, it will be referred as FAR 2.0. 

Current Status

As of June 2025, FAR 2.0 is in the initial stages of rollout. Updates have been made to Part 1, “Federal Acquisition Regulation System,” Part 10, “Market Research,” Part 34, “Major System Acquisition,” and Part 52, “Solicitation Provisions and Contract Clauses.” The FAR currently has fifty-three parts, and completion is therefore a long way off. FAR 2.0 is being driven primarily by the OFPP and Federal Acquisition Regulatory Council (FAR Council).

Typically, FAR changes entail public notice-and-comment periods, allowing contractors and industry groups to provide feedback. FAR 2.0, however, may forgo these processes or allow for a very short window to respond, which could limit the influence of the contracting community. 

Potential Impacts to Federal Contractors

The implications of FAR 2.0 are potentially far-reaching, with both opportunities and challenges for contractors. Here are some key areas to consider:

1. Streamlined Compliance

• By removing nonstatutory clauses, FAR 2.0 could reduce the administrative burden on contractors. For small businesses, this could lower barriers to entry and make federal contracting more accessible.
• However, it allows for more interpretations that could lead to questions during audits.

2. Reduced Overhead Costs

• FAR 2.0 could decrease the costs associated with maintaining compliance.
• There could be an uptick in legal challenges due to less-specific regulations.

3. Uncertainty and Transition Challenges

• Government contractors that have relied on clear and stable rules for decades could face confusion if FAR 2.0 introduces significant changes without adequate transition support.
• The shift toward statutory-only provisions means future enhancements will depend on a slower legislative process rather than regulatory updates.

4. Market Accessibility

• If FAR 2.0’s goal is to attract new entrants—particularly nontraditional contractors and innovative firms—to the federal marketplace, making the FAR more user-friendly could encourage competition and diversity in the contractor pool. This could foster innovation and lower costs for government acquisitions of services and products.
• Although the FAR may be reduced in number of clauses or pages, its agency deviations and buying guides will likely grow in volume, which could make entering the contracting space confusing regarding which regulation or deviation to follow. 

What to Watch For

As FAR 2.0 progresses, contractors should monitor several key developments:

• The Federal Register has been a primary source for recent FAR updates, such as Federal Acquisition Circulars (FAC) 2025-01 through 2025-04, though these have not yet addressed FAR 2.0 directly.
• Professional organizations may advocate greater transparency and stakeholder input. Contractors should engage with these groups to stay informed and influence the process.
• Firms are offering guidance to help contractors navigate potential changes. Consultations can provide strategic insights for adapting to FAR 2.0.
• Since FAR 2.0 focuses on statutory provisions, future changes may require congressional action. Monitoring legislative proposals will be critical. 

Conclusion

FAR 2.0 represents a bold effort to modernize the Federal Acquisition Regulation, with the potential to transform how contractors engage with the government. While the promise of streamlined compliance and reduced costs is appealing, the lack of transparency and accelerated timeline raise concerns about implementation challenges. Contractors must stay proactive, leverage industry resources, and monitor official channels to prepare for this generational shift in federal contracting. The success of FAR 2.0 will depend on balancing deregulation and increasing competition with the need for clear, equitable rules that support a diverse and competitive marketplace.

Stay connected to BRG and our Government Contracts experts as this unfolds.