Protests of Requirements-Type Contract Award

B-195945.4,B-198276: Jul 15, 1981

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A firm protested the Defense Logistics Agency's (DLA) determinations to satisfy two of its requirements for disk storage equipment under a General Services Administration (GSA) requirements-type contract with another firm. Because it believed that it was required to satisfy its disk storage needs under the GSA requirements-type contract, DLA terminated competitive procurement actions in both instances when it learned of the GSA award. The protester contended that DLA improperly determined that the requirements-type contract was mandatory in both instances and that the Government could have realized substantial savings through competitive procurements. In two notices released after the date of the requirements-type contract, GSA advised Federal agencies that the contract was a mandatory requirements-type contract except where the contract's terms and conditions did not meet a procuring agency's needs. DLA reported that its needs could be met under the contract. In support of its contention that the requirements-type contract was not mandatory, the protester cited several sections of that contract. However, GAO could not find support for the protester's contentions in any of them. In considering similar protests, GAO has stated that there is no question that requirements contracts are valid and that the promises of both parties to such contracts constitute valid consideration. The assertion that the Government could save money in a particular procurement by, in effect, breaching a mandatory requirements contract also was not a valid basis upon which to sustain a protest. Accordingly, the protest was denied.

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