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Washington D.C.
Wednesday, February 8, 2023

Feds Scrapping DUNS Numbers for Contractors

The U.S. government is phasing out use of the proprietary Data Universal Numbering System, or DUNS number, in favor of a more open system for assigning a unique identifier to every company it does business with.

The news, which came this week in a statement and contract award from the U.S. General Services Administration, was welcomed by open data advocates and government contracting veterans alike.

“I applaud GSA for doing this,” Jim Williams told HS Today. Williams, the former commissioner of the Federal Acquisition Service at GSA and now a  strategic advisor to the Government Technology and Services Coalition, called the move “long overdue.”

Open government advocates the Data Coalition said they were “pleased to see GSA take a key step to move away from a proprietary entity validation service.”

Jessica Yabsley, the Data Coalition’s senior director of communications, told HS Today in a statement the group wanted to see more details but was “hopeful” that the news “will mean more public access to federal spending data and improved procurement data quality on USAspending.gov.”

DUNS numbers are used as a unique identifier for companies globally, and are required for any entity that works, or wants to work, for the federal government — or gets government grants, for example in the aftermath of a disaster.

The DUNS system ensures that businesses registered in the government-wide contracting management system known as SAM or System for Awards Management aren’t ever confused with other companies — and thereby helps prevent fraud and abuse.

The GSA solicitation says the contractor for the new system, Ernst and Young, may use its own proprietary Unique Entity Identifier or UEI, but only to map the data it specifies to a new system — SAM managed identifiers, or SAMMI, numbers. “The contractor’s UEI will remain indefinitely within SAM’s database for mapping and auditing purposes, but will not be published or displayed within SAM,” the solicitation states.

It adds that Ernst and Young shall be required to provide “a plan for transitioning out their services at the end of the contract,” to avoid the government becoming locked in with a single vendor as many believe has happened with the DUNS system.

Earlier procurement documents stated that GSA wanted the new system to provide the government “unlimited right to use, disclose, and share all data associated with the [identified] entity, including the identifier, if applicable, and maintain it in perpetuity.”

Although DUNS numbers are available for free to any company looking for government work, critics like the Data Coalition have long charged that Dun and Bradstreet, the company that runs the DUNS program was milking its control to charge contractors for additional services — and that using a proprietary numbering system meant that government couldn’t really make its contracting data open.

The company developed DUNS numbers in 1963 to assist its credit reporting practice, according to the Dun and Bradstreet website, and currently more than 300 million of them are assigned. They were adopted for federal contracting purposes in the 1990’s.

Auditors at the Government Accountability Office have been critical of the federal government’s use of the DUNS system for years, saying it “limits the purposes for which the government can use the data and hampers the ability to switch to a new numbering system.”

“Dun and Bradstreet effectively has a monopoly for government unique identifiers that has contributed to higher costs,” GAO found last year.

Although DUNS numbers are issued for free, anyone who wants to use the numbers, for instance to break down government spending for a particular company or group of companies has to get a license from Dun and Bradstreet.

In 2014, for instance, feds shut down the Recovery.gov website, which tracked federal spending under the 2009 economic stimulus, in part because the DUNS license they bought to set the site up expired.

According to GAO, the government also had to buy a license to use DUNS for USAspending.gov — which tracks the $3 trillion annual federal expenditures — making it unclear what restrictions there might be on the public’s use of the data.

But on the other hand, Williams pointed out, using DUNS “was theoretically leveraging a commercial scheme” already in wide use outside the government. DUNS numbers are used by the United Nations and the European Union, as well as banks, credit agencies and many other companies.

But now, said Williams, the federal government would be pushing out on its own, using a system that only it recognized.

“When the government creates its own mechanisms, such as for companies doing business with them … you hope it does allow for competition but also has a low cost to comply and is as widely acceptable as possible,” Williams said. To help with that he urged greater take-up of the new SAMMI numbers outside of the federal government.

“It would be great if other levels of government, state and local, adopted this new numbering scheme too,” he said. “Maybe even private sector or international governments will agree to leverage this new numbering system too.”

He explained that the change over “should not be too much of an additional burden to companies doing work with the government since they already have to register anyway.”

But he added it might “create some additional system complexities for these companies to make changes within their own systems to recognize and use this new number.”

GSA said the contract, with a one year base period and four one year options would be worth $41 million. The agency added that Dun and Bradstreet would work with the new contractor to ensure a seamless switch over.

Shaun Waterman
Shaun is an award-winning journalist who has worked for the BBC and United Press International. In the past five years, Shaun has launched two of the best-respected and most widely read DC daily cybersecurity newsletters — POLITICO Pro's Morning Cybersecurity and Scoop News Group's CyberScoop. Shaun became UPI's Homeland and National Security Editor shortly after Sept. 11, 2001, covering the Department of Homeland Security from its standup in 2003. His reporting on DHS and counter-terrorism policy earned him two (2005, 2011) "Dateline Washington" awards from the Society of Professional Journalists, and a senior fellowship at the George Washington University Center for Cyber and Homeland Security. In 2009-10 Shaun produced a major report on cybersecurity for critical infrastructure at the Center for Strategic and International Studies, a leading Washington think tank. From 2010-2013, he wrote about intelligence, foreign affairs and cybersecurity as a staff reporter for The Washington Times. Shaun, who is British, has a master’s degree in social and political sciences from King’s College, Cambridge. He is married and lives in Washington, DC with his wife and three American sons, Miles, Harry and Peter.

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