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Uniform Commercial code vs Federal Acquisition Regulation

Based on your experience or readings, discuss the differences between the Uniform Commercial Code in the private sector and the Federal Acquisition Regulations (FAR) and Model Procurement Code in the public sector, as they affect the exercise of the Purchasing and Supply Management function. To what extent does the FAR affect the implementation of Supply Chain Management in the federal public sector? Discuss the collaboration between the Purchasing and Supply Management Department and the Legal Department to ensure that the buying organization complies with all applicable legal and/or regulatory requirements affecting the development of purchasing- related documents and execution of contract-related provisions.

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There are differences between the Federal Acquisition Regulations and Uniform Commercial Code that affect the implementation of the Supply Chain Management in the federal public sector. In case of the FAR non Government commercial purchases must be inspected by a system created by the contractor. The government still retains right to inspect goods before acceptance (FAR 52.246). In case of UCC the buyer has the right to inspect the goods before making payment at any time and in any reasonable manner. This provision affects supply chain management as the inspection has to be carried out and the documents submitted to the government.. In the UCC the buyer bears the cost of inspection. The UCC says that if the goods are rejected the seller bears the cost of inspection. In case of government contracts the FAR allows the government to unilaterally change the contract (See Part 43). There is provision for equitable adjustment of contract price and schedule. In case of the UCC the buyer cannot unilaterally change a contract. if there is modification, waiver, and rescission of contract it is covered by the terms of UCC 2-209. Further, if there is a dispute or a contractor makes a claim, in the FAR the Government issues a change order and there is a dispute, the Contract Disputes Act applies under USC 41 Section 7107. A change order has serious implications for purchase and supply chain management.In case of UCC if there is a dispute either permissible damages may be paid or there is a traditional litigation. Under the FAR (Part 14) ...

Solution Summary

This solution explains the key differences between UCC and FAR. The sources used are also included in the solution.

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