Are Fiscal Agent Agreements/Financial Agency Agreements subject to the FAR?

According to the Department of the Treasury, financial agency agreements are not "procurement contracts" and are not subject to the FAR. See http://www.treasury.gov/initiatives/financ.../Pages/faa.aspx.

The National Bank Acts of 1863 and 1864 grant Treasury the authority to retain financial agents to provide services on its behalf. Financial agents act on behalf of the Government during the performance of their duties under an agent-principal relationship with Treasury. Financial agents have the fiduciary obligation to protect the interests of the United States. Financial Agency Agreements (FAA) entered into by Treasury do not constitute procurement contracts under the purview of Federal Acquisition Regulations. The Secretary of the Treasury has designated financial institutions to support the implementation of the EESA, including banks, savings associations, credit unions, security brokers or dealers, insurance companies, and other entities to serve as Treasury's financial agents.

Emphasis added. You can read the text of FAAs entered into by Treasury at the website to which I provided a link.

I don't know about financial agency agreements entered into by other agencies.

According to the Department of the Treasury, financial agency agreements are not "procurement contracts" and are not subject to the FAR.

Thanks, Vern. What I find strange is that the Treasury site does not actually cite any authority for that position (that FAAs are not procurement contracts subject to the FAR). You would think the statutory authority would address it, but Treasury's does not, and other agencies statutory authority also is silent about it. So how did Treasury arrive at its conclusion? The FAR applies to "acquisitions, and FAR 2.101 defines "acquisitions to mean:

?Acquisition? means the acquiring by contract with appropriated funds of supplies or services (including construction) by and for the use of the Federal Government through purchase or lease, whether the supplies or services are already in existence or must be created, developed, demonstrated, and evaluated.

If the FAA is a contract, with appropriated funds exchanged for services, by and for the use of the federal agency, then doesn't it qualify as an "acquisition" IAW FAR 2.101?

Thanks, Vern. What I find strange is that the Treasury site does not actually cite any authority for that position... So how did Treasury arrive at its conclusion? ... If the FAA is a contract, with appropriated funds exchanged for services, by and for the use of the federal agency, then doesn't it qualify as an "acquisition" IAW FAR 2.101?

I think Vern already answered your question, and it has to do with the fact that the holder of an FAA is a fiduciary and agent of the government (typically acting in its sovereign capacity), while those holding procurement contracts generally are not. See, for instance, the ABA's Public Contract Law section's comment to the proposed rule back in 2009 available here (esp. pages 3 & 4) and discussed in 51 GC ? 108 (4/1/09).

You cannot go by what FAR says. FAR says things about acquisition that are not true. For example, FAR 1.101 says:

The Federal Acquisition Regulations System is established for the codification and publication of uniform policies and procedures for acquisition by all executive agencies.

That simply is not true. There are a number of executive agencies, as defined in FAR 2.101, that do not have to comply with FAR, even though they conduct acquisitions -- e.g., TVA, FAA, BPA, the U.S. Mint, and several others.

Here is a quote from 51 GC ? 108, cited by Jacques:

Treasury has ?long had authority? to designate financial institutions as financial agents of the Government, and ?has not treated such agency financial agreements as subject to procurement laws or the FAR.? Rather, Treasury distinguished the financial agents as fiduciaries of the Government and not as contractors, the sections noted, although contractors that enter into procurement contracts are not generally deemed to have a fiduciary relationship with the Government.

The lack of such a distinction suggests that ?it will not always be obvious whether an arrangement to provide services under TARP must be provided by a financial agent or may be provided by a contractor,? the sections stated. ?The distinctions are difficult to draw, and require analysis of: applicable banking laws and regulations; the procurement laws and regulations; the purpose of the arrangement and nature of the services being solicited; whether a fiduciary relationship is required; and whether Treasury is acting in its ?sovereign? capacity or more like a commercial entity.?

Our laws and regulations are often murky, as best. Applicability of the procurement statutes and the FAR to agency transactions is not always clear, but agencies have to decide how to proceed and tend to do so on practical grounds. Such decisions will stand unless successfully challenged in court. Treasury didn't cite more specific authority because there isn't any, one way or the other.

It isn't like Congress is unaware of Treasury's use of this authority. P.L. 110-343, Emergency Economic Stabilization Act of 2008 (EESA), ? 101( c )(3) provides,

The Secretary is authorized to take such actions as the Secretary deems necessary to carry out the authorities in this Act, including, without limitation, ... [d]esignating financial institutions as financial agents of the Federal Government, and such institutions shall perform all such reasonable duties related to this Act as financial agents of the Federal Government as may be required.

Section 105 refers to these financial agents as receiving "compensation." Before EESA, see generally U.S. v. Citizens & S. Nat'l Bank, 889 F.2d 1067 (Fed. Cir. 1989), finding these agreements as not procurement contracts subject to the FAR. For a more critical view of this authority, see Transactive Corp. v. U.S., 91 F.3d 232 (D.C. Cir. 1996).