True or False: Agencies should only use restrictive provisions when absolutely necessary.

The assertion that agencies should only use restrictive provisions when absolutely necessary is rooted in the principles of fairness and competition in procurement. Restrictive provisions can limit the pool of potential contractors and may unduly restrict competition, leading to potential issues such as increased costs or a lack of innovation in solutions offered.

In federal contracting, there is a strong emphasis on fostering competition to ensure that taxpayers receive the best value for their money. Using restrictive provisions sparingly helps maintain an open and competitive environment, which is beneficial for both the government and contractors. It aligns with regulatory guidance emphasizing the need for agencies to justify any restrictions they impose during the procurement process, ensuring that such measures are truly warranted by the specific needs of the contract.

Thus, the correct understanding emphasizes that while there may be instances where restrictive provisions are necessary—for example, to protect proprietary information or ensure compliance with specific regulations—they should generally be applied with caution and only in situations that clearly justify their use. This approach encourages a fair contracting process and facilitates broader participation in government opportunities.