Feds Are One Step Closer to Launching an e-Marketplace

Published: May 09, 2019

Acquisition ReformGSANational Defense Authorization ActPolicy and Legislation

Last week, GSA submitted its phase two implementation plan to Congress for establishing a federal e-commerce portal for buying commercial products.

Requirements for a federal e-commerce portal stem from the 2018 National Defense Authorization Act (NDAA), specifically Section 846 which directs GSA to “...establish a program to procure commercial products through commercial e-commerce portals for purposes of enhancing competition, expediting procurement, enabling market research, and ensuring reasonable pricing of commercial products.”

The NDAA prescribed a three-phased approach: policy recommendations, analysis and study, and testing concepts. The submission of the implementation plan completes phase two and enters phase three of testing proofs of concepts. The phase two report specifies GSA’s program decisions, legislative recommendations, and findings from its market research and consultations.

Resulting from thorough market research and consultations with federal agencies and industry, GSA’s key program decisions include:

  • Implementing an initial proof of concept to evaluate the results of actual purchases before making significant investments and issuing any regulations.
  • Limiting purchases to the micro-purchase threshold (MPT).
  • Starting with the e-marketplace model for the initial proof of concept

GSA will continue to evaluate the e-commerce and e-procurement portal models for opportunities and benefits. GSA also recommends that the MPT be increased from $10,000 to $25,000 for five years for purchases made through “GSA-approved commercial e-commerce portals.”  This change would require legislative action.

GSA’s report concludes by stating that “Section 846 is an opportunity for the government to review, assess, and modernize its current approach toward the buying of COTS items.”  The proof of concept will allow GSA to test whether there are savings and efficiency potential to be gained through an e-marketplace platform for federal purchasing.  The proof of concept model will also allow GSA to evaluate and test the model in an ever-evolving and fast-changing e-commerce landscape.

GSA’s next steps include the issuance of a draft RFP, which is due out by the end of June for e-marketplace service providers, and implementation of a proof of concept by the end of the calendar year.  The phase three report is due to Congress in March 2020.