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Single Source Contract Regulations - Compliance Regime

The new regulatory framework has a compliance & associated penalty regime, that was not present under the earlier "Yellow Book" GPFAA pricing arrangements.
Under the Defence Reform Act 2014 the enforcement agency for the issue of compliance notices and penalties is the UK MoD with the Single Source Regulations Office (SSRO) acting as the arbitrator in the event of a UK MoD/Industry dispute.
The penalty levels are pre-determined for specific contraventions and the contractor is also liable for damages at law in certain circumstances.
Compliance Contraventions
The types of contraventions that can lead initially to the UK MoD issuing a compliance notice are: 
  • A failure to comply with the requirement to keep accounting and other records; or a failure to comply with reporting requirements
  • A contravention with respect to assessment of proposed sub-contracts
  • Knowingly or recklessly providing a misleading report
  • A failure to notify the UK MoD of a material event affecting the project performance, cost or price.