The new rule, announced Dec. 20 and which takes effect Jan. 19, guides agency contract officers on when to deny contracts to companies that break federal laws. The Business Roundtable, a confederation of industry associations, filed a lawsuit in U.S. District Court in Washington, D.C., Dec. 22 seeking to block the rule. Meanwhile, Rep. Tom Davis, R-Va., is looking at what a legislative remedy might look like, said an aide to the congressman.
Opponents also express hope of persuading the incoming president to somehow nullify it.
The ruleempowers federal contracting officers to deny contracts to companies that repeatedly violatetax, labor, employment, safety and health, environmental and consumer protection laws. The rule has been revised twice since it was first unveiled by the administration in July 1999. Each revision brought a sharp outcry from the business community complaining the rule was too arbitrary and too subjective to implement fairly. After the latest revision in June, two federal agencies the General Services Administration and the Environmental Protection Agency joined the opposition, arguing the rule was too ambiguous to implement. Joshua Gotbaum, Office of Management and Budget executive associate director, defended the final version of the rule.