Even though governments have the corporate powers of buying and selling, they are still governments, and they must be fair and impartial when buying goods and services from the general public. Private entities can do business with whomever they want, unless they purport to provide goods or services to the public generally, in which case they may not discriminate solely on the basis of race, religion, sex, creed, ethnic origin, or disability. Government contracts and private contracts alike are subject to legislative changes. However, because private parties do not have the power to change the law, both parties take a chance when they enter into an agreement. The set of laws and regulations that govern government contracts is immense, complex, and ever-changing.
Laws encompass written statutes and precedential court opinions that interpret the statutes.
Administrative regulations have the force of law if they have a binding effect on both the government and private parties. Administrative agencies exist on the federal, state, county, and local levels. Federal laws and regulations cover contracts issued by federal administrative agencies. Contracts issued by state administrative agencies are regulated by state laws and regulations, unless the state law or regulation is preempted by a federal law or regulation or encroaches on a federal government prerogative. The state procurement laws vary slightly from state to state, but most laws follow the same general principles.