Bid Protests

A bid protest is a formal challenge by a company that believes a federal agency broke the rules in awarding a contract, for example by misreading a proposal, ignoring its own evaluation criteria, or favoring a competitor. Companies can protest to the agency itself, to the Government Accountability Office, or to the U.S. Court of Federal Claims. The Competition in Contracting Act of 1984 gave the GAO its protest role and requires it to decide cases within 100 days.

A protest filed at the GAO quickly enough automatically suspends the contract while the case is decided, which gives companies a strong incentive to file. Agencies often fix problems on their own, through what is called corrective action, before the GAO rules. In fiscal year 2025, companies filed 1,688 protests at the GAO, the fewest in a decade, and about 52 percent ended with the protester winning a sustained ruling or a voluntary fix by the agency.

Large contracts for fighter jets, tankers, cloud computing, and other programs have been delayed for months or years by protests, including the Air Force tanker competition of 2008 and the Pentagon's JEDI cloud contract. Some lawmakers and defense officials want large companies that lose protests to pay the government's costs, a loser pays rule, while the GAO and many contractors say protests are already declining and help keep agencies honest.