GSA’s Commercial Marketplaces Initiative: Opening Amazon and Other Private Marketplaces To Direct Purchases By Government Users

GSA’s Commercial Marketplaces Initiative: Opening Amazon and Other Private Marketplaces To Direct Purchases By Government Users, Briefing Papers (Thomson Reuters), No. 20-13 (Dec. 2020).

GWU Legal Studies Research Paper No. 2021-04

GWU Law School Public Law Research Paper No. 2021-04

21 Pages Posted: 27 Jan 2021

See all articles by Christopher R. Yukins

Christopher R. Yukins

George Washington University - Law School

Abraham Young

affiliation not provided to SSRN

Kristen E. Ittig

Arnold & Porter

Eric Valle

affiliation not provided to SSRN

Date Written: December 2020

Abstract

The U.S. General Services Administration (GSA) opened a new chapter in public procurement by awarding three contracts—to Amazon Business, Overstock.com, and Fisher Scientific—that will allow federal users to buy directly from online electronic marketplaces, with sales anticipated to total $6 billion annually. This proof-of-concept effort, dubbed the “commercial platforms” initiative by GSA, marks a radical departure from traditional procurement practices because it will allow individual Government users (not necessarily procurement officials) to make “micro-purchases” (generally up to $10,000) using Government purchase cards. By removing the federal procurement system as an intermediary in the purchasing process, and in essence outsourcing the selection of available sources to private providers of electronic platforms, GSA’s initiative has both reshaped procurement and potentially redrawn a marketplace. This paper reviews the purpose and history of GSA’s commercial platforms initiative, which began with a mandate from Congress to explore electronic commerce options and evolved through long exchanges with industry, users, and other stakeholders. In assessing the reasons for the initiative, the paper notes a longstanding concern (framed by principles of agency theory) that users’ needs were not being met by the traditional procurement system. The paper discusses GSA’s decision to steer the initiative to existing commercial platforms and reviews key elements of the solicitation used to frame the “no-cost” contracts with the online marketplaces. Because Amazon Business was by far the most prominent of the awardees—indeed, Amazon had played an ongoing role in pressing for the procurement—and vendors may want to sell through the commercial platforms to reach federal customers, this paper focuses on Amazon Business’ procedures in discussing how vendors might join the commercial platforms. The paper concludes with a series of Guidelines that vendors and other market participants might use, as they enter this new corner of the federal marketplace.

Keywords: Commercial platforms, U.S. General Services Administration

JEL Classification: H11, H57

Suggested Citation

Yukins, Christopher R. and Young, Abraham and Ittig, Kristen E. and Valle, Eric, GSA’s Commercial Marketplaces Initiative: Opening Amazon and Other Private Marketplaces To Direct Purchases By Government Users (December 2020). GSA’s Commercial Marketplaces Initiative: Opening Amazon and Other Private Marketplaces To Direct Purchases By Government Users, Briefing Papers (Thomson Reuters), No. 20-13 (Dec. 2020)., GWU Legal Studies Research Paper No. 2021-04, GWU Law School Public Law Research Paper No. 2021-04, Available at SSRN: https://ssrn.com/abstract=3773096

Christopher R. Yukins (Contact Author)

George Washington University - Law School ( email )

2000 H Street, N.W.
Washington, DC 20052
United States
202-994-9992 (Phone)

Abraham Young

affiliation not provided to SSRN

Kristen E. Ittig

Arnold & Porter ( email )

1600 Tysons Blvd.
Ste. 900
McLean, VA 22153
United States

Eric Valle

affiliation not provided to SSRN

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