What opportunities do DIU prototype solicitations create for small space companies?
DIU prototype solicitations can create a competition path to prototype work and, when documented, a possible follow-on production path.
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What opportunities do DIU prototype solicitations create?
According to 10 U.S.C. 4022, the Director of the Defense Innovation Unit may carry out prototype projects that are directly relevant to improving Department of Defense mission effectiveness or improving platforms, systems, components, or materials. That gives small space companies a lawful entry point to compete for prototype work when their technology fits the stated need. The statute also says competitive procedures should be used to the maximum extent practicable, which favors a competitive solicitation structure rather than a closed award path. For larger transactions, the statute imposes written determinations and, above the stated threshold, congressional notification. It also requires a Comptroller General access clause for agreements with payments over $5,000,000. Acquisition guidance adds that follow-on production contracts for products developed under 10 U.S.C. 4022 are excepted from FAR part 206 only when the contracting officer receives sufficient documentation showing the solicitation and agreement included follow-on production provisions and the applicable statutory requirements were met.
What is the practical opportunity for a small space company?
Follow-on production is not automatic
Acquisition guidance says the contracting officer needs sufficient documentation from the agreements officer, and 10 U.S.C. 4022 requires the solicitation and agreement to include follow-on production provisions and any applicable threshold findings before the exception applies.
Process
- 1
Review the prototype scope
Confirm that the solicitation fits the prototype authority described in 10 U.S.C. 4022 and that the technology is directly relevant to the stated mission need.
- 2
Check for follow-on production language
Verify that the solicitation and agreement include follow-on production provisions if production work is part of the opportunity.
- 3
Plan for statutory conditions
If the transaction is large enough, account for the written determinations, congressional notice, and access-clause requirements stated in the statute.
- 4
Keep documentation aligned
Make sure the agreements officer’s documentation is sufficient to support any later follow-on production exception under acquisition guidance.
- DIU can use 10 U.S.C. 4022 to carry out prototype projects tied to DoD mission effectiveness or platform and system improvements.
- The statute says competitive procedures should be used to the maximum extent practicable, which creates an open competition opportunity.
- A follow-on production path can exist, but only when the solicitation, agreement, thresholds, and documentation requirements are satisfied.
- For higher-value transactions, the statute adds written determinations, congressional notification above the stated threshold, and access-clause requirements.
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