# Defense Federal Acquisition Regulation Supplement; Miscellaneous Amendments > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/fr%3A95-29187 ## Record - **Collection:** Federal Register - **Document type:** Rule - **Published:** November 30, 1995 - **Citation:** 60 FR 61586 ## Text SUMMARY: Defense Acquisition Circular (DAC) 91-9 amends the Defense Federal Acquisition Regulation Supplement (DFARS) to revise, finalize, or add language on ethics, personal services contracts, contract award, class justifications and approvals, integrated materiel management, preaward surveys, qualification requirements, audit, field pricing reports, subcontracting plans, environmentally sound products, hazardous materials, foreign source restrictions, supercomputers, Indian incentives, preference for local residents, allowable individual compensation, cost principles, manufacturing science and technology program, research and development, firefighting and security-guard services, automatic data processing equipment leasing reviews, cost monitoring, contract quality requirements, contract data reporting, master agreements, and acquisition of commercial items. DATES: Effective date: November 30, 1995. Comment date: Comments on the interim rule (Item XXXV: Sections 203.170-1; 203.170-4; 203.570-5; 207.105; 209.103-70; Parts 210, 211, and 212, Sections 215.971-4; 217.7302; 219.704; 223.570-4; 225.7002-2; 225.7019-2; 225.7103; 225.7201; 227.7101; 227.7102-3; 227.7103-15; 227.7202-2; 234.001; 242.7206; 246.204; 246.704; 246.770-1; 247.572-1; 247.572-2; 252.203-7000; 252.203-7001; 252.209-7000; 252.210-7000 through 252.210-7004; 252.211-7000 through 252.211-7021; 252.212-7000; 252.212-7001; 251.217-7026; 252.219-7003; 252.219-7005; 252.225-7012; 252.225-7014; 252.225-7016; 252.225-7026; 252.227-7103; 252.227-7015; 252.227-7037; 252.247-7023; and 252.247-7024) should be submitted in writing to the address shown below on or before January 29, 1996, to be considered in the formulation of the final rule. ADDRESSES: Interested parties should submit written comments on the interim rule (Item XXXV) to: Defense Acquisition Regulations Council, PDUSD(A&T)DP(DAR), IMD 3D139, 3062 Defense Pentagon, Washington, DC 20301-3062. Telefax number (703) 602-0350. Please cite DFARS Case 95- D712 in all correspondence related to this rule. FOR FURTHER INFORMATION CONTACT: Item XXXV--Mr. Louis Gaudio, (703) 695-1097. All other items--Ms. Lucile Martin, (703) 602-0131. SUPPLEMENTARY INFORMATION: A. Background This Defense Acquisition Circular (DAC) 91-9 includes 35 rules and miscellaneous editorial amendments. Five of the rules in the DAC (Items II, IX, XII, XIV, and XXIII) were published previously in the Federal Register and thus are not included as part of this rulemaking notice. These five rules are being published in the DAC to revise the looseleaf edition of DFARS to conform to the previously published revisions. Item XXXV, Acquisition of Commercial Items, was subject to Office of Management and Budget Review under Executive Order 12866, dated September 30, 1993. B. Determination to Issue an Interim Rule (Item XXXV) A determination has been made under the authority of the Secretary of Defense that urgent and compelling reasons exist to publish an interim rule prior to affording the public an opportunity to comment. Federal Acquisition Circular 90-32 (60 FR 48206, September 18, 1995) revised the Federal Acquisition Regulation (FAR) to implement Title VIII of the Federal Acquisition Streamlining Act of 1994 (Pub. L. 103- 355). Title VIII of Pub. L. 103-355 contained requirements for the acquisition of commercial items and required publication of implementing FAR revisions by October 1, 1995. The FAR rule became available for use on October 1, 1995, and is mandatory for use by all Federal agencies in commercial item solicitations issued after December 1, 1995. This DFARS rule implements DoD-unique requirements of Pub. L 103-355 pertaining to the acquisition of commercial items. DoD contracting activities cannot effectively use the FAR commercial item procedures without this supplemental DFARS guidance. Immediate DFARS coverage is needed to permit DoD contracting activities to comply with Pub. L. 103-355 and the implementing FAR requirements pertaining to the acquisition of commercial items. C. Regulatory Flexibility Act DAC 91-9, Items I, VI, VII, VIII, X, XV, XVIII, XXI, XXV, XXVIII, XXIX, XXX, XXXI, XXXIII, XXXIV The Regulatory Flexibility Act does not apply because these rules are not significant revisions within the meaning of the Regulatory Flexibility Act, 5 U.S.C. 601 et seq. However, comments from small entities will be considered in accordance with Section 610 of the Act. Such comments must be submitted separately. Please cite the applicable DFARS case number in correspondence. DAC 91-9, Items IV, V, XI, XIII, XVI, XVII, XX, XXII, XXVI DoD certifies that these rules will not have a significant economic impact on a substantial number of small entities within the meaning of the Regulatory Flexibility Act because: Item IV--The rule only pertains to (1) purchases made outside the United States for use by armed forces outside the United States; (2) internal Government considerations regarding leasing; (3) production contracts where special tooling/special test equipment costs exceed $1,000,000; and (4) certain notification requirements under the Certificate of Competency Program which were repealed by Section 7101(b) of the Federal Acquisition Streamlining Act of 1994. Item V--The use of class justifications and approvals is already permitted by the Federal Acquisition Regulation (FAR). This rule merely expands Defense FAR Supplement (DFARS) guidance to address the use of class justifications and approvals for multiple contracts extending across more than one program phase. Item XI--The rule primarily relates to the application of Government resources for conducting field pricing reviews. Item XIII--The rule merely reflects the extension of statutory authority for contractors to claim credit toward their small business subcontracting goals when awarding subcontracts to qualified nonprofit agencies for the blind or severely disabled. Item XVI--The rule only applies in exceptional situations when non- DoD-owned toxic or hazardous materials are stored or disposed of on a military installation. Item XVII--The DFARS already permits DoD to grant public interest exceptions to the Buy American Act, where the purposes of the Buy American Act are not served. This rule [[Page 61587]] merely amends the DFARS guidance to reflect a recent statutory change to the criteria that must be considered when granting a public interest exception, and to streamline internal DoD approval requirements. Item XX--The rule places restrictions on the acquisition of foreign products. Item XXII--The rule only applies to contracts that are awarded in support of the closure or realignment of a military installation. Item XXVI--The rule only applies to contracts that are awarded under the Manufacturing Science and Technology Program. DAC 91-9, Items III, XIX, XXIV, XXVII, XXXII The Regulatory Flexibility Act applies. A final regulatory analysis has been performed and is available by writing the Defense Acquisition Regulations Council, PDUSD(A&T)DP(DAR), 3062 Defense Pentagon, Washington, DC 20301-3062. DAC 91-9, Item XXXV This interim rule is expected to have a positive economic impact on a substantial number of small entities within the meaning of the Regulatory Flexibility Act, 5 U.S.C. 601, et seq., because the rule simplifies procedures for DoD acquisition of commercial items. An Initial Regulatory Flexibility Analysis (IRFA) has been prepared and may be obtained from the address stated herein. A copy of the IRFA has been submitted to the Chief Counsel for Advocacy of the Small Business Administration. Comments from small entities concerning the affected DFARS subparts will be considered in accordance with Section 610 of the Act. Such comments must be submitted separately and cite DFARS Case 95- D712 in correspondence. D. Paperwork Reduction Act DAC 91-9, Items I, III, IV, V, VI, VII, VIII, X, XI, XV, XVI, XVII, XVIII, XIX, XX, XXI, XXII, XXIV, XXV, XXVI, XXVII, XXVIII, XXIX, XXX, XXXI, XXXII, XXXIII, XXXIV, XXXV The Paperwork Reduction Act does not apply because the revisions in this rulemaking notice do not contain and/or affect information collection requirements which require the approval of OMB under 44 U.S.C. 3501 et seq. DAC 91-9, Item XIII The Paperwork Reduction Act applies. OMB has approved the information collection requirement under OMB Control Number 9000-0007. Michele P. Peterson, Executive Editor, Defense Acquisition Regulations Council. Defense Acquisition Circular (DAC) 91-9 amends the Defense Federal Acquisition Regulation Supplement (DFARS) 1991 edition. The amendments are summarized as follows: Item I--Ethics (DFARS Case 95-D707) This final rule deletes DFARS Subpart 203.71, Contractor Employee Communications with Government Officials, and the corresponding contract clause at 252.203-7003, Prohibition Against Retaliatory Personnel Actions. DFARS Subpart 203.71 and the clause at 252.203-7003 implemented 10 U.S.C. 2409a, which was repealed by Section 6005 of the Federal Acquisition Streamlining Act of 1994 (Pub. L. 103-355). Guidance on whistleblower protections for contractor employees has been added to the FAR at Subpart 3.9, by Federal Acquisition Circular 90-30, dated July 21, 1995. Item II--Sequence of Progress Payments and Contract Modifications (DFARS Case 93-D016/95-D012) This final rule was issued by Departmental Letter 95-012, effective July 3, 1995. The rule amends DFARS Subparts 204.71, 215.4, 217.74, and 243.1 to provide additional guidance regarding identification of funding under DoD contracts. Contracting officers shall ensure that contracts clearly identify the accounting classification reference numbers which apply to each line and subline item. When a line item contains multiple accounting classification citations, the contract shall include instructions which provide for payment in a manner that reflects the performance of work on the contract. Contracts that contain both fixed-price and cost-reimbursement line or subline items shall identify the contract type for each line or subline item. In addition, contract modifications which obligate or deobligate funds shall identify the accounting changes for each line and subline item to facilitate appropriate payment. Item III--Personal Services Contracts (DFARS Case 94-D302) The interim rule published as Item XXX of DAC 91-7 is revised and finalized. The rule establishes procedures for entering into personal services contracts under 10 U.S.C. 1091 to carry out health care responsibilities in medical treatment facilities. The final rule differs from the interim rule in that it adds language at DFARS 206.001, deletes 206.102, and amends 237.104(b)(ii), to recognize that personal services contracts authorized by 10 U.S.C. 1091 are exempt from FAR Part 6 competition requirements. Item IV--Contract Award (DFARS Case 95-D701) The interim rule issued by Departmental Letter 95-016 on August 7, 1995, is converted to a final rule without change. The rule (1) revises DFARS 206.302-5(b)(i) to exclude soft drinks, that are manufactured in the United States, from the limitations which apply to noncompetitive acquisition of items from military exchange stores outside the United States; (2) adds a new section at DFARS 207.470 to place restrictions on the lease of vessels, aircraft, or vehicles for a term of 18 months or more; (3) deletes the language at DFARS 215.871 concerning production special tooling and production special test equipment; and (4) deletes DFARS 219.602-1(a), 219.602-70, and 252.219-7009 to eliminate certain notification requirements pertaining to the Certificate of Competency Program. These DFARS revisions implement Sections 1506, 3065, 3066, and 7101(b) of the Federal Acquisition Streamlining Act of 1994 (Pub. L. 103-355). Item V--Class Justifications and Approvals (DFARS Case 95-D009) This final rule adds language at DFARS 206.303-1(c) and 207.102 to state that: (1) When conditions warrant, a class justification for other than full and open competition may provide for award of multiple contracts extending across more than one program phase; and (2) when a class justification for other than full and open competition has been approved, planning for competition shall be consistent with the terms of that approval. Item VI--Integrated Materiel Management (DFARS Case 95-D005) This final rule amends DFARS 208.7003 to permit greater flexibility for local purchase of items assigned for integrated materiel management (IMM), when such action is in the best interest of the Government. The dollar threshold at which file documentation is required to justify local purchase of an IMM item is increased from $100 per line item to the micro-purchase threshold. The dollar threshold at which a waiver is required, before local purchase of an IMM item, is increased from $5,000 per line item to the simplified acquisition threshold. Additionally, the list of points of contact for waiver requests is revised. [[Page 61588]] Item VII--Preaward Survey (DFARS Case 95-D016) This final rule revises DFARS 209.106-1 to delete the requirement for the contracting officer to contact the cognizant contract administration activity when the contracting officer is unable to make a determination of responsibility for a low-dollar value acquisition. Guidance regarding sources of information to support determinations of responsibility can be found at FAR 9.105-1(c). Item VIII--Qualification Requirements (DFARS Case 95-D011) This final rule revises DFARS 209.202 to delegate authority for approval of qualification requirements, except those pertaining to Qualified Products Lists (QPLs) or Qualified Manufacturers Lists (QMLs), to the chief of the contracting office. QPLs and QMLs are managed in accordance with DoD Manual 4120.3-M, Defense Standardization Program Policies and Procedures. Item IX--Institutions of Higher Education (DFARS Case 94-D310) This interim rule was issued by Departmental Letter 95-007, effective March 6, 1995. The rule adds a new section and contract clause at DFARS 209.470 and 252.209-7005 to implement Section 558 of the Fiscal Year 1995 Defense Authorization Act (Pub. L. 103-337). Section 558 provides that no funds available to DoD may be provided by grant or contract to any institution of higher education that has a policy of denying, or which effectively prevents the Secretary of Defense from obtaining for military recruiting purposes, entry to campuses, access to students on campuses, or access to directory information pertaining to students. Item X--Audit (DFARS Case 95-D705) This final rule amends DFARS 215.804-8, 235.015-71, 237.7204, 252.239-7010, and C-204.3, and deletes the clause at 252.215-7001, to reflect revisions to the FAR published as Item I of Federal Acquisition Circular (FAC) 90-31 on August 16, 1995. Item I of FAC 90-31 (1) revised the policy pertaining to contractor records retention at FAR 4.703; (2) deleted the clause at FAR 52.215-1, Examination of Records by Comptroller General; and (3) revised the clauses at FAR 52.214-26, Audit and Records--Sealed Bidding, and 52.215-2, Audit and Records-- Negotiation, to provide for examination of records by the Comptroller General. Item XI--Field Pricing Report (DFARS Case 95-D010) This final rule amends DFARS 215.805-5 to increase, from $1 million to $10 million, the dollar threshold for requesting field pricing reports for cost-type proposals from offerors without significant estimating system deficiencies. Item XII--Comprehensive Small Business Subcontracting Plans (DFARS Case 95-D002) This final rule was issued by Departmental Letter 95-015, effective July 10, 1995. The rule amends DFARS 219.702 and the clause at 252.219- 7004 to implement Section 7103 of the Federal Acquisition Streamlining Act of 1994 (Pub. L. 103-355). Section 7103 extends, through September 30, 1998, the test program for contractor use of comprehensive small business subcontracting plans. Item XIII--Subcontracting Plans for Nonprofit Agencies for the Blind or Severely Disabled (DFARS Case 94-D312) The interim rule issued by Departmental Letter 95-004, on February 27, 1995, is converted to a final rule without change. The rule amends DFARS 219.703 to implement Section 804 of the Fiscal Year 1995 Defense Authorization Act (Pub. L. 103-337). Section 804 extends, through September 30, 1997, the authority for contractors to claim credit toward their small business subcontracting goals for subcontracts with qualified nonprofit agencies for the blind or severely disabled. Item XIV--Evaluation Preference for Small Disadvantaged Business Concerns (DFARS Case 95-D008) This final rule was issued by Departmental Letter 95-017, effective August 22, 1995. The rule amends DFARS 219.7001 to state that the evaluation preference for small disadvantaged business concerns shall not be used in acquisitions for long distance telecommunications services. Item XV--Environmentally Sound Products (DFARS Case 95-D303) This final rule adds a new section at DFARS 223.404 to (1) designate the approving official for acquisition of EPA designated items which do not meet EPA or agency minimum recovered material standards; and (2) require agency collection and consolidation of annual contractor certifications pertaining to the use of recovered materials. Item XVI--Hazardous Materials (DFARS Case 94-D309) The interim rule issued by Departmental Letter 95-006, on March 6, 1995, is revised and finalized. The rule amends DFARS Subpart 223.71 and the clause at 252.223-7006 to implement Section 325 of the Fiscal Year 1995 Defense Authorization Act (Pub. L. 103-337). Section 325 provides an additional exception to the statutory prohibition on storage and disposal of non-DoD-owned toxic and hazardous materials on military installations. The final rule differs from the interim rule in that it revises alternate paragraph (d) of the clause at 252.223-7006 to clarify requirements for flowdown of the clause to subcontractors. Item XVII--Determinations Under the Buy American Act (DFARS Case 94-D313) The interim rule issued by Departmental Letter 95-011, dated July 3, 1995, is converted to a final rule without change. The rule amends DFARS 225.102 to implement Section 812 of the Fiscal Year 1995 Defense Authorization Act (Pub. L. 103-337). Section 812 adds several factors to the series of factors at 10 U.S.C. 2533 that must be considered when deciding whether to grant a public interest exception to the Buy American Act. In addition, the rule changes the approval levels for granting such exceptions. Item XVIII--Australian Memorandum of Agreement (DFARS Case 95-D013) This final rule amends DFARS 225.872-1 to add Australia to the list of countries whose defense products are not subject to the restrictions of the Buy American Act/Balance of Payments Program. The rule implements a Memorandum of Agreement Concerning Reciprocal Defense Procurement, dated April 19, 1995, between the United States and Australia, and a determination made by the Deputy Secretary of Defense, on April 29, 1995, that it is inconsistent with the public interest to apply the restrictions of the Buy American Act to the acquisition of defense equipment produced or manufactured in Australia. Item XIX--Restriction on Procurement of Goods (DFARS Case 94-D314) The interim rule published as Item XIV of DAC 91-7 is revised and finalized. The rule implements the foreign source restrictions of 10 U.S.C. 2534. The interim rule differs from the final rule in that it revises DFARS 225.7007-4, 225.7010-3, and 225.7016-3 to refer to, rather than repeat, the waiver criteria at 225.7004-4. [[Page 61589]] Item XX--Supercomputers (DFARS Case 95-D301) The interim rule issued by Departmental Letter 95-013 on July 3, 1995, is revised and finalized. The rule adds a section at DFARS 225.7023 and a contract clause at 252.225-7011 to implement Section 8023 of the Fiscal Year 1995 Defense Appropriations Act (Pub. L. 103- 335). Section 8023 and comparable sections in prior Defense Appropriations Acts require that any supercomputers acquired with defense funds appropriated in Fiscal Years 1988 through 1995 must be manufactured in the United States, unless the Secretary of Defense certifies to the Congress that the supercomputers are for national security purposes and are not available from United States manufacturers. The final rule differs from the interim rule in that it corrects the statutory citation at 225.7023-1. Item XXI--Indian Incentives (DFARS Case 95-D027) This final rule adds a new section at DFARS 226.103 to provide procedures for obtaining contract funding for an approved Indian incentive payment request. Item XXII--Preference for Local Residents (DFARS Case 94-D315) The interim rule published as Item XX of DAC 91-7 is revised and finalized. The rule implements Section 817 of the Fiscal Year 1995 Defense Authorization Act (Pub. L. 103-337). Section 817 authorizes the Secretary of Defense to give preference to entities that plan to hire local residents, when entering into contracts for services to be performed at a military installation that is affected by closure or realignment under a base closure law. The final rule differs from the interim rule in that it adds language at DFARS 226.7104 to clarify that the guidance in this section applies to contracts related to base closure activities. Item XXIII--Payment Protections in Construction Contracts Between $25,000 and $100,000 (DFARS Case 95-D305) This interim rule was issued by Departmental Letter 95-018, effective August 31, 1995. The rule adds a new section and contract clause at DFARS 228.171 and 252.228-7007. The rule provides alternative payment protections for construction contracts between $25,000 and $100,000, pending implementation of Section 4104(b)(2) of the Federal Acquisition Streamlining Act of 1994 (Pub. L. 103-355) in the FAR. Section 4104(b)(2) requires FAR revisions to provide alternatives to payment bonds as payment protections for suppliers of labor and material under construction contracts between $25,000 and $100,000. Federal Acquisition Circular 90-29 revised FAR Part 13 to exclude construction contracts and subcontracts at or below the simplified acquisition threshold from Miller Act bond requirements, in accordance with Section 4104(b)(1) of Pub. L. 103-355. Item XXIV--Limitation on Allowable Individual Compensation (DFARS Case 94-D318) The interim rule published as Item XXII of DAC 91-7 is converted to a final rule without change. The interim rule amended DFARS 231.205, 231.303, 231.603, and 231.703 to implement Section 8117 of the Fiscal Year 1995 Defense Appropriations Act (Pub. L. 103-335). Section 8117 limits allowable costs for individual compensation to $250,000 per year. This limitation applies to contracts that are awarded after April 15, 1995, and that are funded with Fiscal Year 1995 appropriations. Item XXV--Cost Principles (DFARS Case 95-D704) This final rule amends the DFARS to delete language that was incorporated into the FAR by Federal Acquisition Circular 90-31, dated August 15, 1995. Accordingly, the following DFARS sections are deleted: 231.205-6(g)(2)(i); 231.603(1); 231.703(1); 231.70; 237.171; 242.705- 1(b) (3) and (4); 242.770; 252.231-7001; 252.237-7020; 252.237-7021; and 252.242-7001. Item XXVI--Manufacturing Science and Technology Program (DFARS Case 94-D307) The interim rule published as Item XXVI of DAC 91-7 is converted to a final rule without change. The interim rule added language at DFARS 235.006 (a) and (b)(iv) to implement Section 256 of the Fiscal Year 1995 Defense Authorization Act (Pub. L. 103-337). Section 256 requires use of competitive procedures in awarding contracts under the Manufacturing Science and Technology Program, and use of a cost-sharing arrangement for these contracts unless an alternative arrangement is approved by the Secretary of Defense. Item XXVII--Federally Funded Research and Development Centers (FFRDCs) (DFARS Case 94-D306) The interim rule published as Item XXVIII of DAC 91-7 is revised and finalized. The rule allows DoD-sponsored FFRDCs that function primarily as research laboratories to respond to solicitations and announcements for programs which promote research, development, demonstration, or transfer of technology. The final rule differs from the interim rule in that it adds, at DFARS 235.017-1, the names of DoD- sponsored FFRDCs that function primarily as research laboratories. Item XXVIII--Research and Development Streamlined Contracting Procedures--Test (DFARS Case 92-D034) This final rule amends DFARS 235.7002 to add the Army Soldier Systems Command and the Naval Command, Control and Ocean Surveillance Center to the list of contracting offices authorized to participate in the streamlined research and development contracting test program. In addition, editorial corrections are made at 235.7003(b)(1) and in paragraph H.5 of the exhibit at 235.7006(d). Item XXIX--Firefighting and Security-Guard Services (DFARS Case 95- D035) This final rule adds a new section at DFARS 237.102-70 to reflect the requirements of 10 U.S.C. 2465, which prohibits the award of DoD contracts for firefighting or security-guard functions except under certain conditions. Item XXX--Annual Automatic Data Processing Equipment (ADPE) Leasing Review (DFARS Case 95-D017) This final rule amends DFARS 239.7303 to eliminate the requirement for annual review of ADPE leasing costs and, instead, require review of ADPE leasing costs as warranted. Item XXXI--Cost Monitoring (DFARS Case 95-D08) This final rule deletes the language of DFARS 242.7003-1(b), regarding requirements for in-depth functional reviews of certain contractor activities, to provide contract administration offices greater flexibility in planning and executing cost monitoring programs. Item XXXII--Contract Quality Requirements (DFARS Case 95-D007) The interim rule issued by Departmental Letter 95-010, on June 13, 1995, is converted to a final rule without change. The rule amends DFARS Part 246 to encourage increased use of commercial quality standards by removing existing requirements to use military quality standards. The rule revises the definition of ``quality program,'' replaces direct references to MIL-I-45208 and MIL-Q-9858 with references to higher-level contract quality requirements, and deletes Table [[Page 61590]] 46-1, Contract Quality Requirements Guide. Item XXXIII--Contract Data Reporting (DFARS Case 95-D711/95-D713) This final rule contains the guidance issued by Departmental Letter 95-014, on July 6, 1995, and additional guidance pertaining to DD Form 350 and DD Form 1057 reporting requirements. The rule revises DFARS 204.6, 253.204-70 and 253.204-71 to comply with reporting requirements of the Federal Acquisition Streamlining Act of 1994 (Pub. L. 103-355). Except for contracting actions pertaining to contingencies as described at FAR 13.101, contracting officers will continue to use DD Form 350 to report all contracting actions exceeding $25,000. Contracting actions pertaining to contingencies will continue to be reported on DD Form 1057. Until the forms are revised, the term ``small purchase procedures'' used on DD Forms 350 and 1057 shall be interpreted to mean ``simplified acquisition procedures.'' Item XXXIV--Master Agreements (DFARS Case 95-D038) This final rule deletes DFARS 237.270, Master Agreements. The authority to award master agreements for advisory and assistance services under 10 U.S.C. 2304 expired on September 30, 1994. Item XXXV--Acquisition of Commercial Items (DFARS Case 95-D712) This interim rule amends the DFARS to conform to the FAR changes pertaining to the acquisition of commercial items, published as Item III of FAC 90-32 on September 18, 1995. The rule also implements DoD- unique requirements of the Federal Acquisition Streamlining Act of 1994 (Pub. L. 103-355) regarding the acquisition of commercial items. Following is a summary of the DFARS amendments contained in this rule: --Part 203 is amended to reflect that the statutory prohibitions of 10 U.S.C. 2397b do not apply to contractors that supply only commercial items to DoD. --Part 207 is amended to reflect the preference for commercial items and the requirement for market research contained in FAR Parts 10 and 11. --Parts 210, 211, and 212 are revised to reflect the restructuring of FAR Parts 10, 11, and 12. Part 210 is retitled ``Market Research'' and contains no DFARS text; Part 211 is retitled ``Describing Agency Needs'' and revised to include guidance that was previously included in Part 210; and Part 212 is retitled ``Acquisition of Commercial Items'' and revised to include two new subparts. Subpart 212.3 prescribes solicitation provisions and contract clauses for use in DoD acquisitions of commercial items, to include a new solicitation provision at 252.212-7000, Offeror Representations and Certifications-- Commercial Items, and a new contract clause at 252.212-7001, Contract Terms and Conditions Required to Implement Statutes Applicable to Defense Acquisition of Commercial Items. Subpart 212.5 contains lists of statutes that do not apply, or have limited application to, contracts or subcontracts for the acquisition of commercial items. --Part 217 is amended to state that the requirement for contractor identification of sources of supply does not apply to commercial items. --Part 225 is amended to state that certain foreign source restrictions do not apply to commercial items or components purchased by contractors from subcontractors/suppliers. --Part 227 is amended to delete definitions which appear in FAR Part 2 and to clarify that clauses prescribed by 227.7102-3 and 227.7103-15 do not flow down to subcontractors providing commercial items or components. --Part 234 is amended to include the definitions of ``systems'' and ``systems acquisition'' which were deleted from 210.001. --Part 246 is amended to conform to the policy in FAR 12.208 on contract quality assurance. --Amendments are made to conform terminology to the definition of ``commercial items'' in FAR Part 2 and to delete obsolete references. Item XXXVI--Editorial Revisions Note: The asterisked items are revisions being made only in the looseleaf edition of the DFARS. (a) DFARS is amended by revising ``Under Secretary of Defense for Acquisition (USD(A))'' to read ``Under Secretary of Defense for Acquisition & Technology (USD(A&T))'' each place it appears. *(b) Section 202.101 is amended by revising in the definition ``Contracting activity'' under the heading ``NAVY'' the entry ``Space nd Naval Warfare Systems Command'' to read ``Space and Naval Warfare Systems Command.'' (c) Section 204.7003(a)(1) is amended to update the department/ agency identification characters used in procurement instrument identification numbers. (d) Section 209.403 is amended to update the Air Force entry to read ``Air Force--Deputy General Counsel (Contractor Responsibility).'' (e) Section 209.405-1 is amended to redesignate paragraphs (a) and (b) as paragraphs (b) and (c), respectively. (f) Section 214.406-3(e)(i) is amended to revise ``DARPA'' to read ``ARPA.'' (g) Section 225.302. is amended by revising in paragraph (b)(i) under the heading ``DEFENSE LOGISTICS AGENCY'' the entry ``Executive Director, Contracting'' to read ``Executive Director, Procurement''; and to add a new heading and entry between the headings ``DEFENSE MAPPING AGENCY'' and ``ON-SITE INSPECTION AGENCY'' to read `` DEPARTMENT OF DEFENSE OFFICE OF DEPENDENT SCHOOLS, Director.'' (h) Section 225.770-1 is amended by revising between the word ``that'' and the word ``does'' the word ``is'' to read ``it.'' (i) Section 227.7103-6 is amended in paragraph (a) to revise the word ``Innovative'' to read ``Innovation.'' (j) Section 227.7104 is amended in the title by revising the word ``Innovative'' to read ``Innovation'' and by revising in paragraph (a) the word ``Innovative'' to read ``Innovation.'' *(k) Section 232.704-70(c) is amended to revise the word ``funs'' to read ``funds.'' (l) Section 242.705-2 is amended to redesignate paragraphs (b)(2)(iii) and (b)(2)(v) as paragraphs (b)(2)(ii) and (b)(2)(iv), respectively. (m) Section 249.7002(b) is amended in the introductory text to revise the phrase ``Office of Economic Adjustment (OEA), Assistant Secretary of Defense (Force Management and Personnel)'' to read ``Assistant Secretary of Defense (Economic Security), Office of Economic Adjustment (OEA).'' (n) Section 249.7002(b)(2) is amended to revise the Telefax number to read ``(703) 604-5843.'' *(o) Section 252.223-7004(a)(1) is amended to revise ``employe'' to read ``employee.'' (p) Section 252.225-7040 is amended to revise in the introductory text the reference ``225.7004-5(c)'' to read ``225.7004-6(c).'' (q) Section 252.227-7018 is amended in the section title to revise the word ``Innovative'' to read ``Innovation'' and in the clause title to revise the word ``INNOVATIVE'' to read ``INNOVATION.'' (r) Appendix F, F-401, Table 2, is amended to update the Army address for Foreign Military Sales. (s) Appendix G is revised to update activity addresses. [[Page 61591]] Interim Rules Adopted as Final Without Changes PARTS 206, 207, 215, 219, AND 252--[AMENDED] The interim rule that was published at 60 FR 40106 on August 7, 1995, is adopted as final without change. PART 225--[AMENDED] The interim rule that was published at 60 FR 34470 on July 3, 1995, is adopted as final without change. PART 231--[AMENDED] The interim that was published at 60 FR 2330 on January 9, 1995, is adopted as final without change. PART 235--[AMENDED] The interim rule that was published at 60 FR 4569 on January 24, 1995, is adopted as final without change. Interim Rules Adopted as Final With Changes PARTS 206 AND 237--[AMENDED] The interim rule that was published at 60 FR 2888 on January 12, 1995, is adopted as final with amendments at section 237.104, addition of section 206.001, and removal of Subpart 206.1. PART 219--[AMENDED] The interim rule that was published at 60 FR 13074 on March 10, 1995, is adopted as final with amendments at section 219.703. PARTS 223 AND 252--[AMENDED] The interim rule published at 60 FR 13075 on March 10, is adopted as final with amendments at sections 223.7101, 223.7102, and 252.223- 7006. PARTS 225 AND 252--[AMENDED] The interim rule published at 60 FR 19531 on April 19, 1995, is adopted as final with amendments at sections 225.7004-4, 225.7007-4, 225.7010-3, and 225.7016-3. PARTS 225 AND 252--[AMENDED] The interim rule published at 60 FR 34471 on July 3, 1995, is adopted as final with amendments at sections 225.7023-1, 225.7023-3, and 252.225-7011. PART 226--[AMENDED] The interim rule published at 60 FR 5870 on January 31, 1995, is adopted as final with a revision at section 226.7104. PART 235--[AMENDED] The interim rule published at 60 FR 13076 on March 10, 1995, is adopted as final with a revision at section 235.017-1. PART 246--[AMENDED] The interim rule published at 60 FR 33144 on June 27, 1995, is adopted as final with amendments at section 246.202-3. List of Subjects in 48 CFR Parts 201, 202, 203, 204, 206, 207, 208, 209, 210, 211, 212, 214, 215, 217, 219, 223, 225, 226, 227, 228, 231, 232, 234, 235, 237, 239, 242, 246, 247, 249, 250, 252, 253, and Appendices C, F, and G to Chapter 2 Government procurement. Amendments to 48 CFR Chapter 2 (Defense Federal Acquisition Regulation Supplement) 48 CFR Chapter 2 (the Defense Federal Acquisition Regulation Supplement) is amended as set forth below. 1. The authority for 48 CFR parts 201, 202, 203, 204, 206, 207, 208, 209, 210, 211, 212, 214, 215, 217, 219, 223, 225, 226, 227, 228, 231, 232, 234, 235, 237, 239, 242, 246, 247, 249, 250, 252, 253, and Appendices C, F, and G to Chapter 2 continues to read as follows: Authority: 41 U.S.C. 421 and 48 CFR Chapter 1. PART 201--FEDERAL ACQUISITION REGULATIONS SYSTEM 201.201-1 [Amended] 2. Section 201.201-1 is amended by revising in paragraph (d)(i) introductory text the phrase ``OUSD(A)'' to read ``OUSD(A&T);'' and by revising in paragraph (d)(i)V. the phrase ``USD(A)DP'' to read ``USD(A&T)DP.'' 201.301 [Amended] 3. Section 201.301(b) is amended by revising the phrase ``USD(A)'' to read ``USD(A&T).'' 201.304 [Amended] 4. Section 201.304 is amended by revising in paragraph (1) the phrase the ``USD(A)'' to read ``USD(A&T);'' by revising in paragraph (2) the phrase ``USD(A)'' to read ``USD(A&T);'' and by revising in paragraph (2) the phrase ``USD(A)DP'' to read ``USD(A&T)DP;'' by revising in paragraph (3) the phrase ``USD(A)DP'' to read ``USD(A&T)DP;'' by revising in paragraph (4) the phrase ``USD(A)DP'' to read ``USD(A&T)DP;'' by revising in paragraph (5) the phrase ``USD(A)'' to read ``USD(A&T);'' and by revising in paragraph (5) the phrase ``USD(A)DP'' to read ``USD(A&T)DP.'' 201.402 [Amended] 5. Section 201.402 is amended by revising in paragraph (1) the phase ``Office of the Under Secretary of Defense for Acquisition, USD(A)DP'' to read ``Office of the Under Secretary of Defense (Acquisition & Technology), USD(A&T)DP;'' and by revising in paragraph (3) the phrase ``USD(A)DP'' to read ``USD(A&T)DP''. PART 202--DEFINITIONS OF WORDS AND TERMS 6. Section 202.101 is amended by revising the definition of ``Senior procurement executive'' to read: 202.101 Definitions. * * * * * Senior procurement executive, means for DoD-- Department of Defense (including the defense agencies)--Under Secretary of Defense (Acquisition & Technology); Department of the Army--Assistant Secretary of the Army (Research, Development and Acquisition); Department of the Navy--Assistant Secretary of the Navy (Research, Development and Acquisition); Department of the Air Force--Assistant Secretary of the Air Force (Acquisition). The directors of the defense agencies have been delegated authority to act as senior procurement executive for their respective agencies, except for such actions that by terms of statute, or any delegation, must be exercised by the Under Secretary of Defense (Acquisition & Technology). PART 203--IMPROPER BUSINESS PRACTICES AND PERSONAL CONFLICTS OF INTEREST 7. Section 203.170-1 is amended in paragraph (a) by adding a last sentence to read as follows: 203.170-1 Policy. (a) * * * The prohibitions in 10 U.S.C. 2397b do not apply to contractors that supply only commercial items to DoD. * * * * * 8. Section 203.170-4 is revised to read as follows: 203.170-4 Contract clause. Use the clause at 252.203-7000, Statutory Prohibitions on Compensation to Former Department of Defense Employees, in all solicitations and contracts expected to exceed $100,000, except solicitations and contracts for commercial items. [[Page 61592]] 9. Section 203.570-5 is revised to read as follows: 203.570-5 Contract clause. Use the clause at 252.203-7001, Special Prohibition on Employment, in all solicitations and contracts exceeding the simplified acquisition threshold in FAR part 13, except solicitations and contracts for commercial items. 203.703 [Amended] 10. Section 203.703 is amended by revising ``Under Secretary of Defense for Acquisition'' to read ``Under Secretary of Defense (Acquisition & Technology).'' 203.71 [Removed] 11. Subpart 203.71 is removed. PART 204--ADMINISTRATIVE MATTERS 12. Section 204.602-70 is added to read as follows: 204.602-70 Solicitation provision. When the Commercial and Government Entity codes for the prospective offerors are not available to the contracting office, use the provision at 252.204-7001, Commercial and Government Entity (CAGE) Code Reporting. 204.603 [Removed] 13. Section 204.603 is removed. 204.603-70 [Removed] 14. Section 204.603-70 is removed. 204.670-I [Amended] 15. Section 204.670-1 is amended by revising in paragraph (c)(3) the acronym ``SAF/AQCP'' to read ``SAF/AQCI.'' 16. Section 204.670-2 is amended by revising paragraph (c) and paragraph (d) to read as follows: 204.670-2 Reportable contracting actions. * * * * * (c) Do not report on a DD Form 350, contingency actions defined in 213.101. Summarize these actions on a DD Form 1057 in accordance with the instructions in 253.204-71(a)(3). (d) The following contracting actions are not subject to reporting on either the DD Form 350 or DD Form 1057: (1) Micro-purchases obtained through use of the purchase card; (2) Transactions that cite only nonappropriated funds (Funds held in trust accounts for foreign governments shall be treated as appropriated funds.); (3) Transactions for purchase of land, or rental or lease of real property, when the General Services Administration (GSA) executes the contracting action; (4) Orders from GSA stock and the GSA Consolidated Purchase Program; (5) Transactions that involve Government bills of lading or transportation requests, except orders placed under Regional Storage Management Office's (RSMO) BOAs; (6) Requisitions transferring supplies within or among the departments or agencies; and (7) Pursuant to 204.670-6(b), orders placed by other contracting activities against indefinite delivery contracts awarded by the-- (i) Military Sealift Command; (ii) Defense Fuel Supply Center for petroleum and petroleum products; or (iii) Defense General Supply Center for petroleum products. 17. Section 204.670-6 is amended by revising paragraph (b) to read as follows: 204.670-6 Types of DD Form 350 report. * * * * * (b) A consolidated report is one DD Form 350 report which combines several contracting actions. (1) Prepare consolidated reports for-- (i) Air Mobility Command awards for international airlift services. The Command reports these at the end of each operating month with one DD Form 350 for each airlift contract. (ii) Military Sealift Command awards of indefinite delivery contracts for ocean transportation. The Command reports at the beginning of each fiscal year the estimated value of the orders for that fiscal year on one DD Form 350. (iii) Defense Fuel Supply Center or Defense General Supply Center indefinite delivery contracts for petroleum or petroleum supplies. The Centers, at the time of award, report the estimated value of the orders to be placed against the contract on one DD Form 350. (iv) Orders placed by the Defense Commissary Agency (DeCA) for resale items in excess of $25,000. DeCA consolidates the orders monthly and reports the cumulative dollar amounts and actions on one DD Form 350 in accordance with departmental regulations. Defense Logistics Agency activities submit single rather than consolidated reports. (v) Vouchers processed by the U.S. Army Contracting Command, Europe (USACCE), for the purchase of utilities from municipalities (e.g., gas, electricity, water, sewage, steam, snow removal, and garbage collection). USACCE consolidates these transactions monthly and reports the cumulative dollar amount on one DD Form 350 in accordance with departmental regulations. (2) Consolidated reports may be prepared in accordance with departmental instructions for orders under communications service agreements for local dial tone services. * * * * * 18. Section 204.7003 is amended by revising paragraph (a)(1)(i) to read as follows: 204.7003 Basic PII number. (a) * * * (1) * * * (i) Department/agency identification: (A) Department of the Army................. DA (B) Department of the Navy (except Marine N Corps). (C) Department of the Air Force............ F (D) Defense Information Systems Agency..... DCA (E) Defense Logistics Agency............... S (F) Defense Nuclear Agency................. DNA (G) Defense Mapping Agency................. DMA (H) Miscellaneous Defense Activities....... MDA (I) Marine Corps........................... M (J) Ballistic Missile Defense Organization. HQ0006 (K) On Site Inspection Agency.............. OSIA (L) Defense Commissary Agency.............. DECA (M) United States Special Operations USZA Command. * * * * * PART 206--COMPETITION REQUIREMENTS 19. A new section 206.001 is added to read as follows: 206.001 Applicability. (b) Contracts awarded using the procedures in 237.104(b)(ii) are expressly authorized by 10 U.S.C. 1091. 206.1 [Removed] 20. Subpart 206.1 is removed. 21. Section 206.303-1 is amended by adding a new paragraph (c) to read as follows: 206.303-1 Requirements. * * * * * (c) When conditions warrant, a class justification may provide for award of multiple contracts extending across more than one program phase. PART 207--ACQUISITION PLANNING 22. Section 207.102 is added to read as follows: 207.102 Policy. When a class justification for other than full and open competition has been approved, planning for competition shall be accomplished consistent with the terms of that approval. 23. Section 207.105 is amended by revising paragraph (b)(6); paragraph (b)(5); and paragraph (b)(17)(A)(8) to read as follows: [[Page 61593]] 207.105 Contents of written acquisition plans. (a) * * * (b) * * * (6) Product descriptions For development acquisitions, describe the market research undertaken to identify commercial items, commercial items with modifications, or nondevelopmental items (see FAR part 10) that could satisfy the acquisition objectives. * * * * * (15) Environmental considerations. Discuss actions taken to ensure either elimination of or authorization to use class I ozone-depleting chemicals and substances (see 211.271). (17) * * * (A) * * * (8) Expanded use of commercial items, commercial items with modifications, or to the extent commercial items are not available, nondevelopmental items (see FAR part 10). * * * * * PART 208--REQUIRED SOURCES OF SUPPLIES AND SERVICES 24. Section 208.7003-1 is revised to read as follows: 208.7003-1 Assignments under integrated material management (IMM). (a) All items assigned for IMM must be acquired from the IMM manager except-- (1) Items purchased under circumstances of unusual and compelling urgency as defined in FAR 6.302-2. After such a purchase is made, the requiring activity must send one copy of the contract and a statement of the emergency to the IMM manager; (2) Items for which the IMM manager assigns a supply system code for local purchase or otherwise grants authority to purchase locally; or (3) When purchase by the requiring activity is in the best interest of the Government in terms of the combination of quality, timeliness, and cost that best meets the requirement. This exception does not apply to items-- (i) Critical to the safe operation of a weapon system; (ii) With special security characteristics; or (iii) Which are dangerous (e.g., explosives, munitions). (b) When an item assigned for IMM is to be acquired by the requiring activity under paragraph (a)(3) of this subsection, the contracting officer must-- (1) Document the contract file with a statement of the specific advantage of local purchase for an acquisition exceeding the micro- purchase threshold in FAR part 13; and (2) Ensure that a waiver is obtained from the IMM manager before initiating an acquisition exceeding the simplified acquisition threshold in FAR part 13, if the IMM assignment is to the General Services Administration (GSA), the Defense Logistics Agency (DLA), or the Army Materiel Command (AMC). Submit requests for waiver to-- (i) For GSA: Commissioner (F), Federal Supply Service, Washington, DC 20406 (ii) For DLA: Defense Construction Supply Center, ATTN: DCSC-BDA, P.O. Box 3990, Columbus, OH 43216-5000 Defense Electronics Supply Center, ATTN: DESC-ERM, 1507 Wilmington Pike, Dayton, OH 45444-5000 Defense Fuel Supply Center, ATTN: DFSC-OI, Cameron Station, VA 22304-6160 Defense General Supply Center, ATTN: DGSC-X, Richmond, VA 23297- 5000 Defense Industrial Supply Center, ATTN: DISC-OPD, 700 Robbins Avenue, Philadelphia, PA 19111-5096 Defense Personnel Support Center, ATTN: DPSC-CSH, 2800 South 20th Street, P.O. Box 8419, Philadelphia, PA 19101-8419 (iii) For AMC: Commander, U.S. Army Materiel Command, ATTN: AMCLG-S, 5001 Eisenhower Avenue, Alexandria, VA 22333-0001 25. Section 208.7003-2 is amended by revising paragraph (c) to read as follows: 208.7003-2 Assignments under coordinated acquisition. * * * * * (c) Requirements not in excess of the simplified acquisition threshold in FAR part 13, when contracting by the requiring department is in the best interest of the Government; * * * * * PART 209--CONTRACTOR QUALIFICATIONS 26. Section 209.103-70 is revised to read as follows: 209.103-70 Contract clause. Use the clause at 252.209-7000, Acquisition from Subcontractors Subject to On-Site Inspection Under the Intermediate-Range Nuclear Forces (INF) Treaty, in all solicitations and contracts exceeding the simplified acquisition threshold in FAR part 13, except solicitations and contracts for commercial items. 27. Section 209.106-1 is revised to read as follows: 209.106-1 Conditions for preaward surveys. (a) If a preaward survey is requested, include the rationale in block 23 of the SF 1403, Preaward Survey of Prospective Contractor (General). 28. Section 209.202 is revised to read as follows: 209.202 Policy. (a)(1) The inclusion of qualification requirements in specifications for products which are to be included on a Qualified Products List, or manufactured by business firms included on a Qualified Manufacturers List, requires approval by the departmental standardization office in accordance with DoD Manual 4120.3-M, Defense Standardization Program Policies and Procedures. The inclusion of other qualification requirements in an acquisition or group of acquisitions requires approval by the chief of the contracting office. 209.403 [Amended] 29. Section 209.403 is amended under the definition ``Debarring official'' to revise the ``Air Force'' entry to read ``Air Force-- Deputy General Counsel (Contractor Responsibility).'' 209.405-1 [Amended] 30. Section 209.405-1 is amended by redesignating paragraphs (a) and (b) as paragraphs (b) and (c). 209.470-1 [Amended] 31. Section 209.470-1 is amended by removing in paragraph (a) introductory text the comma after the parenthetical phrase ``(Pub. L. 103-337)''; and by revising in paragraph (b) the last sentence ``(See FAR 9.404).'' to read ``(See FAR 9.404.)'' 209.470-3 [Amended] 32. Section 209.470-3 is amended to revise ``252.209-7007'' to read ``252.209-7005.'' PART 210--SPECIFICATIONS, STANDARDS, AND OTHER PURCHASE DESCRIPTIONS Part 210--[Removed] 33. Part 210 is removed. 34. Part 211 is revised to read as follows: [[Page 61594]] PART 211--DESCRIBING AGENCY NEEDS Sec. 211.002 Policy. 211.002-70 Contract clause. Subpart 211.2--Using and Maintaining Requirements Documents 211.201 Identification and availability of specifications. 211.204 Solicitation provisions and contract clauses. 211.270 Brand name or equal purchase descriptions. 211.270-1 Policy. 211.270-2 Solicitation provision. 211.271 Elimination of use of class I ozone-depleting substances. 211.272 Alternate preservation, packaging, and packing. Subpart 211.5--Liquidated Damages 211.504 Contract clauses. Subpart 211.6--Priorities and Allocations 211.602 General. 211.002 Policy All systems acquisition programs in the DoD are subject to the acquisition streamlining policies and procedures in DoDI 5000.2, Defense Acquisition Management Policies and Procedures. 211.002-70 Contract clause. Use the clause at 252.211-7000, Acquisition Streamlining, in all solicitations and contracts for systems acquisition programs. Subpart 211.2--Using and Maintaining Requirements Documents 211.201 Identification and availability of specifications. (a) The DoD index of data item descriptions is DoD 5010.12-L, Acquisition Management Systems and Data Requirements Control List (AMSDL). (b) Also, furnish data item descriptions which are not listed in the AMSDL, except when it is not feasible, e.g., documents are bulky or only a limited number of copies are available at the contracting activity. (d) The AMSDL, all unclassified specifications and standards listed in the DODISS, and data item descriptions listed in the AMSDL may also be purchased from the Standardization Documents Desk, Building 4D, 700 Robbins Avenue, Philadelphia, PA 19111-5094. Include with the letter or DD Form 1425-- (i) The requester's customer number; and (ii) Complete return mailing address, including any ``mark for'' instructions. 211.204 Solicitation provisions and contract clauses. (c) When contract performance requires use of specifications and standards which are not listed in the DODISS and data item descriptions which are not listed in the AMSDL, use provisions, as appropriate, substantially the same as those at 252.211-7001, Availability of Specifications and Standards Not Listed in DODISS, Data Item Descriptions Not Listed in DoD 5010.12-L, and Plans, Drawings, and Other Pertinent Documents, and 252.211-7002, Availability for Examination of Specifications, Standards, Plans, Drawings, Data Item Descriptions, and Other Pertinent Documents. 211.270 Brand name or equal purchase descriptions. 211.270-1 Policy. When a ``brand name or equal'' purchase description is used-- (a) The purchase description-- (1) Should include a complete common generic identification of the item. (2) Should reference all known acceptable brand name products, to include-- (i) Name of manufacturer, producer, or distributor of each brand name product referenced (and address if not well known); and (ii) Model, make, or catalog number for each, and identity of the commercial catalog in which it appears. (3) May, if necessary to adequately describe an item, use a commercial catalog description or an extract from the catalog. Ensure that a copy of each catalog referenced (except parts catalogs) is available at the contracting office for review by offerors. (4) Should give prospective offerors the opportunity to offer products other than those specifically referenced by brand name, as long as they meet the needs of the Government in essentially the same manner as the brand name product. (5) Must identify those salient physical, functional, or other characteristics which are essential to the needs of the Government. (b) The solicitation-- (1) Shall be at or below the simplified acquisition threshold in FAR part 13. (2) May require bid samples for ``or equal'' offers, but not for ``brand name'' offers. (3) Must provide for full consideration and evaluation of ``or equal'' offers against the salient characteristic specified in the purchase description. Do not reject offers for minor differences in design, construction, or features which do not affect the suitability of the product for its intended use. (4) Must include the following immediately after the item description--Offering: Manufacturer's Name______ Brand______ Model or Part No.______ (c) The contract shall-- (1) Not exceed the simplified acquisition threshold in FAR part 13. (2) Identify, or incorporate by reference an identification of the specific products the contractor is to furnish. Include any brand name, make or model number, descriptive material, and any modifications of brand name products specified in the offer. 211.270-2 Solicitation provision. (a) When a brand name or equal purchase description is included in a solicitation at or below the simplified acquisition threshold in FAR part 13, use the provision at 252.211-7003, Brand Name or Equal. (b) When component parts of an end item are described by brand name or equal purchase descriptions and application of the provision at 252.211-7003 to some or all of the components is impracticable, either do not use the provision or limit its application to specified components. 211.271 Elimination of use of class I ozone-depleting substances. (a) Contracts. No DoD contract may include a specification or standard that requires the use of a class I ozone-depleting substance or that can be met only through the use of such a substance unless the inclusion of the specification or standard is specifically authorized at a level no lower than a general or flag officer or member of the Senior Executive Service of the requiring activity in accordance with Section 326, Public Law 102-484 (10 U.S.C. 2301 (repealed) note). (b) Modifications. (1) Contracts awarded before June 1, 1993, with a value in excess of $10 million, that are modified or extended (including option exercise) and, as a result of the modification or extension will expire more than one year after the effective date of the modification or extension, must be evaluated in accordance with agency procedures for the elimination of ozone-depleting substances. (i) The evaluation must be carried out within 60 days after the first modification or extension. (ii) No further modification or extension may be made to the contract until the evaluation is complete. (2) If, as a result of this evaluation, it is determined that an economically [[Page 61595]] feasible substitute substance or alternative technology is available, the contracting officer shall modify the contract to require the use of the substitute substance or alternative technology. (3) If a substitute substance or alternative technology is not available, a written determination shall be made to that effect at a level no lower than a general or flag officer or member of the Senior Executive Service of the requiring activity. 211.272 Alternate preservation, packaging, and packing. Use the provision at 252.211-7004, Alternate Preservation, Packaging, and Packing, in solicitations which include military preservation, packaging, or packing specifications when it is feasible to evaluate and award using commercial or industrial preservation, packaging, or packing. Subpart 211.5--Liquidated Damages. 211.504 Contract clauses. (b) Use the clause at FAR 52.211-12, Liquidated Damages-- Construction, in all construction contracts exceeding $500,000, except cost-plus-fixed-fee contracts or contracts where the contractor cannot control the pace of the work. Use of the clause in contracts of $500,000 or less is optional. Subpart 211.6--Priorities and Allocations. 211.602 General. DoD implementation of the Defense Priorities and Allocations System is in DoDI 4400.1, Priorities and Allocations--Delegation of DO and DX Priorities and Allocations Authorities, Rescheduling of Deliveries and Continuance of Related Manuals. 35. Part 212 is revised to read as follows: PART 212--ACQUISITION OF COMMERCIAL ITEMS--GENERAL Sec. Subpart 212.2--Special Requirements for the Acquisition of Commercial Items 212.211 Technical data. Subpart 212.3--Solicitation Provisions and Contract Clauses for the Acquisition of Commercial Items 212.301 Solicitation provisions and contract clauses for the acquisition of commercial items. 212.302 Tailoring of provisions and clauses for the acquisition of commercial items. Subpart 212.5--Applicability of Certain Laws to the Acquisition of Commercial Items 212.503 Applicability of certain laws to Executive Agency contracts for the acquisition of commercial items. 212.504 Applicability of certain laws to subcontracts for the acquisition of commercial items. Subpart 212.2--Special Requirements for the Acquisition of Commercial Items 212.211 Technical data. The DoD policy for acquiring technical data for commercial items is at 227.7102. Subpart 212.3--Solicitation Provisions and Contract Clauses for the Acquisition of Commercial Items 212.301 Solicitation provisions and contract clauses for the acquisition of commercial items. (f)(i) Use the provision at 252.225-7013, Domestic Wool Preference, as prescribed in 225.7002-4(b). (ii) Use one of the following provisions as prescribed in part 225: (A) 252.225-7000, Buy American Act--Balance of Payments Program Certificate. (B) 252.225-7006, Buy American Act--Trade Agreements--Balance of Payments Program Certificate. (C) 252.225-7035, Buy American Act--North American Free Trade Agreement Implementation Act--Balance of Payments Program Certificate. (iii) Use the provision at 252.212-7000, Offeror Representations and Certifications--Commercial Items, in all solicitations for commercial items exceeding the simplified acquisition threshold in FAR part 13. If an exception to 10 U.S.C. 2410i applies to a solicitation exceeding the simplified acquisition threshold (see 225.770-3), indicate on an addendum that ``The certification in paragraph (b) of the provision at 252.225-7000 does not apply to this solicitation.'' (iv) Use the clause at 252.212-7001, Contract Terms and Conditions Required to Implement Statutes Applicable to Defense Acquisitions of Commercial Items, in all solicitations and contracts for commercial items, completing paragraph (b), as appropriate. 212.302 Tailoring of provisions and clauses for the acquisition of commercial items. (c) Tailoring inconsistent with customary commercial practice. The head of the contracting activity is the approval authority within the DoD for waivers under FAR 12.302(c). Subpart 212.5--Applicability of Certain Laws to the Acquisition of Commercial Items 212.503 Applicability of certain laws to Executive Agency contracts for the acquisition of commercial items. (a) The following laws are not applicable to contracts for the acquisition of commercial items: (i) Section 806, Public Law 102-190 (10 U.S.C. 2301 (repealed) note), Payment Protections for Subcontractors and Suppliers. (ii) 10 U.S.C. 2306(b), Prohibition on Contingent Fees. (iii) 10 U.S.C. 2324, Allowable Costs Under Defense Contracts. (iv) 10 U.S.C. 2384(b), Requirement to Identify Suppliers. (v) 10 U.S.C. 2397(a)(1), Reports by Employees or Former Employees of Defense Contractors. (vi) 10 U.S.C. 2397b(f), Limits on Employment for Former DoD Officials. (vii) 10 U.S.C. 2397c, Defense Contractor Requirements Concerning Former DoD Officials. (viii) 10 U.S.C. 2408(a), Prohibition on Persons Convicted of Defense Related Felonies. (ix) 10 U.S.C. 2410b, Contractor Inventory Accounting System Standards (see 252.242-7004). (x) 107 Stat 1720 (Section 843(a), Public Law 103-160), Reporting Requirement Regarding Dealings with Terrorist Countries. (xi) Domestic Content Restrictions in the National Defense Appropriations Acts for Fiscal Years 1996 and Subsequent Years. (c) The applicability of the following laws has been modified in regard to contracts for the acquisition of commercial items: (i) 10 U.S.C. 2402, Prohibition on Limiting Subcontractor Direct Sales to the United States (see FAR 3.503 and 52.203-6). (ii) 10 U.S.C. 2306a, Truth in Negotiations Act (see FAR 15.804). 212.504 Applicability of certain laws to subcontracts for the acquisition of commercial items. (a) The following laws are not applicable to subcontracts at any tier for the acquisition of commercial items or commercial components: (i) 10 U.S.C. 2241 note, Limitations on Procurement of Food, Clothing, and Specialty Metals Not Produced in the United States. (ii) Section 806, Public Law 102-190 (10 U.S.C. 2301 (repealed) note), Payment Protections for Subcontractors and Suppliers. (iii) 10 U.S.C. 2306(b) Prohibition on Contingent Fees. [[Page 61596]] (iv) 10 U.S.C. 2313(c), Examination of Records of a Contractor. (v) 10 U.S.C. 2320, Rights in Technical Data. (vi) 10 U.S.C. 2321, Validation of Proprietary Data Restrictions. (vii) 10 U.S.C. 2324, Allowable Costs Under Defense Contracts. (viii) 10 U.S.C. 2327, Reporting Requirement Regarding Dealings with Terrorist Countries. (ix) 10 U.S.C. 2384(b), Requirement to Identify Suppliers. (x) 10 U.S.C. 2391 note, Notification of Substantial Impact on Employment. (xi) 10 U.S.C. 2393, Prohibition Against Doing Business with Certain Offerors or Contractors. (xii) 10 U.S.C. 2397(a)(1), Reports by Employees or Former Employees of Defense Contractors. (xiii) 10 U.S.C. 2397b(f), Limits on Employment for Former DoD Officials. (xiv) 10 U.S.C. 2397c, Defense Contractor Requirements Concerning Former DoD Officials. (xv) 10 U.S.C. 2408(a) Prohibition on Persons Convicted of Defense Related Felonies. (xvi) 10 U.S.C. 2410b, Contractor Inventory Accounting System Standards. (xvii) 10 U.S.C. 2501 note, Notification of Proposed Program Termination. (xviii) 10 U.S.C. 2534, Miscellaneous Limitations on the Procurement of Goods Other Than United States Goods. (xix) 10 U.S.C. 2534(c), Preference for United States and Canadian Valves and Machine Tools. (xx) 10 U.S.C. 2534(d), Restriction on Acquisition of Carbonyl Iron Powder. (xxi) 10 U.S.C. 2534(e), Restriction on Acquisition of Air Circuit Breakers. (xxii) Effective May 1, 1996: 10 U.S.C. 2631, Transportation of Supplies by Sea. (xxiii) 19 U.S.C. 2512, Trade Agreements Act. (xxiv) 41 U.S.C. 10, Buy American Act. (xxv) 10 U.S.C. 2327 (Section 843(a), Public Law 103-160), Reporting Requirement Regarding Dealings with Terrorist Countries. (xxvi) Domestic Content Restrictions in the National Defense Appropriations Acts for Fiscal Years 1996 and Subsequent Years. (b) Certain requirements of the following laws have been eliminated for subcontracts at any tier for the acquisition of commercial items or commercial components: (i) 10 U.S.C. 2393(d), Subcontractor Reports Under Prohibition Against Doing Business with Certain Offerors (see FAR 52.209-6). (ii) 10 U.S.C. 2402, Prohibition on Limiting Subcontractor Direct Sales to the United States (see FAR 3.503 and 52.203-6). PART 214--SEALED BIDDING 214.406--3 [Amended] 36. Section 214.406-3 is amended by revising in paragraph (e)(i) the phrase ``DARPA'' to read ``ARPA.'' PART 215--CONTRACTING BY NEGOTIATION 37. Section 215.804-8 is revised to read as follows: 215.804-8 Contract clauses. If the solicitation or contract includes one of the clauses at FAR 52.215-23, FAR 52.215-24, or FAR 52.215-25, also use the clause at 252.215-7000, Pricing Adjustments. 215.805-5 [Amended] 38. Section 215.805-5 is amended by revising in paragraph (a)(1)(A)(3) the amount ``$1 million'' to read ``$10 million.'' 215.971-4 [Amended] 39. Section 215.971-4(d)(3)(A) is amended by revising the word ``product'' to read ``item.'' PART 217--SPECIAL CONTRACTING METHODS 217.103-1 [Amended] 40. Section 217.103-1 is amended by revising in paragraph (b)(v) the phrase ``(Acquisition)'' to read ``(Acquisition & Technology)'' and the phrase ``(USD(A)DP)'' to read ``(USD(A&T)DP);'' by revising in paragraph (b)(v) the phrase ``Deputy Assistant'' to read ``Under'' and by revising the phrase ``(OASD(C)(P/B))'' to read ``(USD(C)P/B))''; by revising in paragraph (b)(vi)(A)(2) the phrase ``(Acquisition)'' to read ``(Acquisition & Technology);'' and by revising in paragraph (b)(viii)(C) the phrase ``(Acquisition)'' to read ``(Acquisition & Technology).'' 41. Section 217.7302 is amended by revising paragraph (b) to read as follows: 217.7302 Procedures. * * * * * (b) The requirement in paragraph (a) of this section does not apply to commercial items. 217.7406 [Amended] 42. Section 217.7406 is amended by revising ``252.217.7027'' to ``252.217-7027.'' PART 219--SMALL BUSINESS AND SMALL DISADVANTAGED BUSINESS CONCERNS 219.703 [Amended] 43. Section 219.703(a) is amended by revising the reference ``Pub. L. 103-277'' to read Public Law 103-337.'' 44. Section 219.704 is revised to read as follows: 219.704 Subcontracting plan requirements. (a)(1) The goal for use of small disadvantaged business concerns shall include subcontracts with historically black colleges and universities and minority institutions (see subpart 226.70), in addition to subcontracts with small disadvantaged business concerns. Subcontracts with historically black colleges and universities and minority institutions do not have to be included in the small disadvantaged business goal in commercial items subcontracting plans. 219.1006 [Amended] 45. Section 219.1006(b)(2) is amended by revising the phrase ``(Acquisition)'' to read ``(Acquisition & Technology).'' PART 223--ENVIRONMENT, CONSERVATION, OCCUPATIONAL SAFETY, AND DRUG- FREE WORKPLACE 46. Section 223.104 is revised to read as follows: 223.104 Exemptions. (c) The authority to act for the agency head under this subpart is limited to a level no lower than an official who is appointed by and with the advice of the Senate. For the defense agencies, this is the Under Secretary of Defense (Acquisition and Technology). 47. A new subpart 223.4 is added to read as follows: Subpart 223.4--Use of Recovered Materials 223.404 Procedures. (b)(3) A contract for an EPA designated item which does not meet the EPA or agency minimum recovered material standards shall not be awarded before approval of the written determination required by FAR 23.404(b)(3). The approving official shall be-- (A) A general or flag officer, or a member of the Senior Executive Service, of the requiring activity; or (B) For requiring activities without a general or flag officer or member of the Senior Executive Service, the commander of the activity. [[Page 61597]] (4) Annual contractor certifications shall be submitted for consolidation and reporting in accordance with department/agency procedures. 48. Section 223.570-4 is amended by revising paragraph (b)(1) to read as follows: 223.570-4 Contract clause. * * * * * (b) Do not use the clause in solicitations and contracts for-- (1) Commercial items; or * * * * * 49. Section 223.7101 is revised to read as follows: 223.7101 Procedures. (a) If the contracting officer is uncertain as to whether particular activities are prohibited or fall under one of the exceptions in 223.7102, the contracting officer should seek advice from the cognizant office of counsel. (b) When storage, treatment, or disposal of non-DoD-owned toxic or hazardous materials is authorized in accordance with this subpart, the contract or authorization should specify the types, conditions, and quantities of toxic or hazardous materials that may be temporarily stored, treated, or disposed of in connection with the contract or as a result of the authorized commercial use of a DoD industrial-type facility. 223.7102 [Amended] 50. Section 223.7102 is amended by removing at the end of paragraph (a)(7) the word ``or''; by removing at the end of paragraph (a)(8) the period and adding a semicolon and the word ``or''; and by adding paragraph (a)(9)(ii) the word ``into'' after the word ``Enters.'' PART 225--FOREIGN ACQUISITION 225.302 [Amended] 51. Section 225.302 is amended by revising in paragraph (b)(i) under the heading ``DEFENSE LOGISTICS AGENCY'' the entry ``Executive Director, Contracting'' to read ``Executive Director, Procurement''; and to add a new heading and entry between the headings ``DEFENSE MAPPING AGENCY'' and ``ON-SITE INSPECTION AGENCY'' to read ``DEPARTMENT OF DEFENSE OFFICE OF DEPENDENTS SCHOOLS, Director.'' 225.403 [Amended] 52. Section 225.403 is amended by revising in paragraph (d)(1)A) the phrase ``(USD(A)DP)'' to read (USD(A&T)DP):'' by revising in paragraph (d)(1) (B) introductory text the phrase ``USDA(A)DP'' to read ``USD(A&T)DP;'' by revising in paragraph (d)(1)B)(2) the phrase ``USD(A)DP'' to read ``USD(A&T)DP.'' 225.770-4 [Amended] 53-54. Section 225.770-4 is amended by revising the phrase ``OUSD(A)DP'' to read ``OUSD(A&T)DP.'' 225.871-7 [Amended] 55. Section 225.871-7 is amended in paragraph (a)(1) revising the phrase ``(ASD(P&L)'' to read ``USD(A&T)DP.'' 225.872-1 [Amended] 56. Section 225.872.1 is amended in paragraph (a) by adding to the listing in alphabetical order the country ``Australia''; and is amended in paragraph (b) by removing from the listing the country ``Australia.'' 225.872-2 [Amended] 57. Section 225.872-2 is amended by revising in paragraph (a)(2)(ii) the phrase ``OASD(P&L), Office of Industrial Base Assessment'' to read ``the Deputy Assistant Secretary of Defense (Industrial Affairs).'' 225.872-3 [Amended] 58. Section 225.872-3 is amended by revising in paragraph (f)(4) the phrase ``(Acquisition)'' to read ``(Acquisition & Technology).'' 59. Section 225.7002-2 is amended by adding a new paragraph (j) to read as follows: 225.7002-2 Exceptions. * * * * * (j) Commercial items or components purchased by contractors from subcontractors/suppliers. 60. Section 225.7004-4 is amended by revising paragraph (b) to read as follows: 225.7004-4 Waiver. * * * * * (b) The restriction is waived when it would cause unreasonable costs. The cost of the item of U.S. or Canadian origin is unreasonable if it exceeds 150 percent of the offered price, inclusive of duty, of items which are not of U.S. or Canadian origin. 61. Section 225.7007-4 is revised to read as follows: 225.7007-4 Waiver. The waiver criteria at 225.7004-4 also apply to this restriction. 62. Section 225.7010-3 is revised to read as follows: 225.7010-3 Waiver. The waiver criteria at 225.7004-4 also apply to this restriction. 63. Section 225.7016-3 is revised to read as follows: 225.7016-3 Waiver. The waiver criteria at 225.7004-4 also apply to this restriction. 225.7018-2 [Amended] 64. Section 225.7018-2 is amended by revising the phrase ``(Acquisition)'' to read ``(Acquisition & Technology).'' 225.7019-2 [Amended] 65. Section 225.7019-2 is amended by revising in paragraph (b) the word ``products'' to read ``items.'' 225.7023-1 [Amended] 66. Section 225.7023-1 is amended by revising the phase ``Section 8101'' to read ``Section 8112.'' 225.7023-3 [Amended] 67. Section 225.7023-3 is amended by revising the word ``Restrictions'' to read ``Restriction.'' 225.7103 [Amended] 68. Section 225.7103 is amended by revising in paragraph (a) the phrase ``small purchase'' to read ``simplified acquisition''; and by revising in paragraph (c) introductory text the word ``products'' to read ``items''. 69. Section 225.7201 is revised to read as follows: 225.7201 Exception. This subpart does not apply to contracts for commercial items, construction, ores, natural gas, utilities, petroleum products and crudes, timber (logs), or subsistence. 225.7307-1 [Amended] 70. Section 225.7307-1(f) is amended to revise the phrase ``OUSD(A)DP(FC)'' to read ``OUSD(A&T)DP(FC).'' 225.7307-2 [Amended] 71. Section 225.7307-2 is amended in paragraph (b) by revising the phrase ``OASD(P&L)'' to read ``USD(A&T)DP.'' PART 226--OTHER SOCIOECONOMIC PROGRAMS 72. A new subpart 226.1 is added to read as follows: Subpart 226.1--Indian Incentive Program. 226.103 Procedures. Contracting officers shall contact the Office of Small and Disadvantaged Business Utilization, Office of the Under Secretary of Defense for Acquisition and Technology, OUSD(A&T) SADBU, Room 2A340, The Pentagon, Washington, DC 20301-3061, (703) 697-1688, to obtain funding for an approved Indian incentive payment request. Upon receipt of funding from OUSD(A&T) [[Page 61598]] SADBU, the contracting officer shall issue a unilateral contract modification to add the incentive payment. 73. Section 226.7104 is revised to read as follows: 226.7104 Other considerations. When planning for contracts for services related to base closure activities at a military installation affected by a closure or realignment under a base closure law, contracting officers shall consider including, as a factor in source selection, the extent to which offerors specifically identify and commit, in their proposals, to a plan to hire residents of the vicinity of the military installation that is being closed or realigned. PART 227--PATENTS, DATA, AND COPYRIGHTS 227.7101 [Amended] 74. Section 227.7101 is amended by removing paragraph (b) and redesignating paragraph (c) as paragraph (b). 75. Section 227.7102-3 is amended by adding a last sentence to paragraph (a); by adding a last sentence to paragraph (b); and by adding a last sentence to paragraph (c) to read as follows: 227.7102-3 Contract clause. (a) * * * Do not require the contractor to include this clause in its subcontracts. (b) * * * Do not require the contractor to include this clause in its subcontracts for commercial items or commercial components. (c) * * * Do not require the contractor to include this clause in its subcontracts for commercial items or commercial components. 227.7103-6 [Amended] 76. Section 227.7103-6 is amended in paragraph (a), second sentence, by revising the word ``Innovative'' to read `` Innovation.'' 77. Section 227.7103-15 is amended by revising paragraph (c) introductory text to read as follows: 227.7103-15 Subcontractor rights in technical data. * * * * * (c) Require prime contractors whose contracts include the following clauses to include those clauses, without modification except for appropriate identification of the parties, in contracts with subcontractors or suppliers, at all tiers, who will be furnishing technical data for non-commercial items in response to a Government requirement: * * * * * 227.7104 [Amended] 78. Section 227.7104 is amended in the title by revising the word ``Innovatiive'' to read ``Innovation''; and by revising in paragraph (a) the word ``Innovative'' to read ``Innovation.'' 227.7202-2 [Removed and Reserved] 79. Section 227.7202-2 is removed and reserved. PART 228--BONDS AND INSURANCE 228.171-1 [Amended] 80. Section 228.171-1(e) is amended by revising ``28.204'' to read ``FAR 28.204.'' PART 231--CONTRACT COST PRINCIPLES AND PROCEDURES 231.205-6 [Amended] 81. Section 231.205-6 is amended by removing paragraph (g)(2)(i). 82. Section 231.603 is revised to read as follows: 231.603 Requirements. The limitation on allowable individual compensation at 231.205- 6(a)(2) also applies to this subpart. 83. Section 231.703 is revised to read as follows: 231.703 Requirements. The limitation on allowable individual compensation at 231.205- 6(a)(2) also applies to this subpart. Subpart 231.70--[Removed] 84. Subpart 231.70 is removed. PART 232--CONTRACT FINANCING 232.170 [Amended] 85. Section 232.170 is amended by revising in paragraph (a) the phrase ``Office of the Under Secretary of Defense (Acquisition), USD(A)DP'' to read ``Office of the Under Secretary of Defense (Acquisition & Technology), USD(A&T)DP''; and by revising in paragraph (b) the phrase ``USD(A)DP'' to read ``USD(A&T)DP.'' 232.171 [Amended] 86. Section 232.171 is amended by revising in paragraphs (a)(1), (b)(1), and (b)(3) the phrase ``USD(A)DP'' to read ``USD(A&T)DP.'' 232.173-1 [Amended] 87. Section 232.173-1(b) is amended by revising the phrase ``(Acquisition)'' to read ``(Acquisition & Technology).'' 232.173-5 [Amended] 88. Section 232.173-5 is amended by revising in the introductory text the phrase ``(Acquisition)'' to read ``(Acquisition & Technology).'' 232.501-2 [Amended] 89. Section 232.501-2(a) is amended to revise the two occurrences of ``USD(A)DP'' to read ``USD(A&T)DP.'' 232.617 [Amended] 90. Section 232.617 is amended by revising the phrase ``USD(A)DP'' to read ``USD(A&T)DP.'' PART 234--MAJOR SYSTEM ACQUISITION 91. Section 234.001 is added to read as follows: 234.001 Definitions. Systems means a combination of elements that will function together to produce the capabilities required to fulfill a mission need. Systems acquisition means the design, development, and production of new systems. It also includes modifications to existing systems that involve redesign of the systems or subsystems. PART 235--RESEARCH AND DEVELOPMENT CONTRACTING 235.015-71 [Amended] 92. Section 235.015-71 is amended by removing in paragraph (i)(2) the entry ``FAR 52.215-1 Examination of Records by Comptroller General'' and by revising in paragraph (i)(2) the title of the entry ``FAR 52.215-2'' to read ``Audit and Records--Negotiation.'' 93. Section 235.017-1 is revised to read as follows: 235.017-1 Sponsoring agreements. (c)(4) DoD-sponsoring FFRDCs that function primarily as research laboratories (C3I Laboratory operated by the Institute for Defense Analysis, Lincoln Laboratory operated by Massachusetts Institute of Technology, and Software Engineering Institute) may respond to solicitations and announcements for programs which promote research, development, demonstration, or transfer of technology (Section 217, Public Law 103-337). 235.7002 [Amended] 94. Section 235.7002 is amended by removing at the end of paragraph (a)(1) the period and adding a semicolon and the words ``Army Soldier Systems Command contracting office.''; and by removing at the end of paragraph (a)(2) the period and adding a semicolon and the words ``Naval Command, Control and Ocean Surveillance Center contracting office.'' 95. Section 235.7003 is amended by revising paragraph (b)(1) to read as follows: [[Page 61599]] 235.7003 Reporting requirements. * * * * * (b) * * * (1) Army: Mr. Chuck Boylan, Army Research Laboratory, Fort Monmouth, Phone: (908) 427-3471; DSN 987-3471; FAX: (908) 532-5188; DSN 992-5188 * * * * * 235.7006 [Amended] 96. Section 235.7006, Exhibit--Research and Development Streamlined Contracting Format, Part I-The Schedule, Section H, Special Contract Requirements is amended by revising paragraph designation (H.8) to read (H.5). PART 237--SERVICE CONTRACTING 97. Section 237.102-70 is added to read as follows: 237.102-70 Prohibition on contracting for firefighting or security- guard functions. (a) Under 10 U.S.C. 2465, the DoD is prohibited for entering into contracts for the performance of firefighting or security-guard functions at any military installation or facility unless-- (1) The contract is to be carried out at a location outside the United States (to include any U.S. commonwealth, territory, or possession) at which members of the armed forces would have to be used for the performance of firefighting or security-guard functions at the expense of unit readiness; (2) The contract will be carried out on a Government-owned but privately operated installation; or (3) The contract (or renewal of a contract) is for the performance of a function under contract on September 24, 1983. (b) Under Section 2907 of Public Law 103-160, this prohibition does not apply to services at installations being closed (see subpart 237.74). 237.104 [Amended] 98. Section 237.104 is amended by revising in paragraph (b)(ii) introductory text the word ``service'' to read ``services;'' by revising in paragraph (b)(ii)(B) the word ``service'' to read ``services;'' and by revising the last sentence in paragraph (b)(ii)(B) to read ``Selections made using the procedures in this section are exempt by statute from FAR part 6 competition requirements (see 206.001(b)).'' 99. Section 237.109 is added to read as follows: 237.109 Services of quasi-military armed forces. See 237.102-70b for prohibition on contracting for firefighting or security-guard functions. 237.171, 237.171-1, and 237.171-2 [Removed] 100. Sections 237.171, 237.171-1, and 237.171-2 are removed. 237.270, 237.270-1, 237.270-2, 237.270-3 and 237.270-4 [Removed] 101. Sections 237.270, 237.270-1, 237.270-2, 237.270-3 and 237.270- 4 are removed. 237.7204 [Amended] 102. Section 237.7204 is amended by revising under the heading ``GENERAL PROVISIONS'' entry No. 6 to read ``FAR 52.215-2, Audit and Records--Negotiation'' in lieu of ``FAR 52.215-1, Examination of Records by Comptroller General.'' PART 239--ACQUISITION OF INFORMATION RESOURCES 103. Section 239.7303 is amended by revising paragraph (b) to read as follows: 239.7303 Review and approval of leasing costs. * * * * * (b) The contracting officer shall conduct reviews of leasing costs as warranted, meeting the criteria of FAR 31.205-2(d), to determine the continued need for leasing. In performing the review, the contracting officer shall request the contractor to update its supporting documentation. * * * * * PART 242--CONTRACT ADMINISTRATION 242.705-1 [Amended] 104. Section 242.705-1 is amended by removing paragraphs (b)(3) and (b)(4). 242.705-2 [Amended] Section 242.705-2 is amended by revising paragraph designations ``(b)(2)(iii)'' and ``(b)(2)(v)'' to read ``(b)(2)(ii)'' and ``(b)(2)(iv)'' respectively. 242.770 [Removed and Reserved] 105. Section 242.770 is removed and reserved. 242.770-1, 242.770-2, 242.770-3, 242.770-4, 242.770-5, and 242.770- 6 [Removed] 106. Sections 242.770-1, 242.770-2, 242.770-3, 242.770-4, 242.770- 5, and 242.770-6 are removed. 242.771-3 [Amended] 107. Section 242.771-3 is amended by revising in paragraph (b)(2) the phrase ``(OUSD(A))'' to read ``(OUSD(A&T))''; and by revising in paragraph (c) the phrase ``(OUSD(A)DDR&E)'' to read ``(OUSD(A&T)DDR&E).'' 108. Section 242.7003-1 is revised to read as follows: 242.7003-1 Description. The annual cost monitoring plan is a schedule for reviewing contractor activities that have the greatest potential for generating erroneous charges to the Government. 109. Section 242.7206 is amended by revising the introductory text to read as follows: 242.7206 Contract clause. Use the clause at 252.242-7004, Material Management and Accounting System, in all solicitations and contracts exceeding the simplified acquisition threshold in FAR part 13 that are not for the acquisition of commercial items and-- * * * * * PART 246--QUALITY ASSURANCE 246.202-3 [Amended] 110. Section 246.202-3 is redesignated as 246.202-4; and paragraphs (i) and (ii) of newly designated 246.202-4 are redesignated as paragraphs (1) and (2) respectively. 246.204 [Removed] 111. Section 246.204 is removed. 246.704 [Amended] 112. Section 246.704 is amended by removing in paragraph (2) the words ``supplies or services'' and inserting the word ``items''; and by revising in paragraph (4) the parenthetical phrase ``(see 246.202-3)'' to read ``(see 246.202-4).'' 113. Section 246.770-1 is amended by revising paragraph (f)(2)(i) to read as follows: 246.770-1 Definitions. * * * * * (f) * * * (2) * * * (i) Commercial items; * * * * * PART 247--TRANSPORTATION 114. Section 247.572-1 is amended by revising paragraph (a) to read as follows: 247.572-1 Ocean transportation incidental to a contract for supplies, services, or construction. (a) This subsection applies when ocean transportation is not the purpose of the contract. However, effective May 1, 1996, this subsection does not apply to subcontracts for the acquisition of [[Page 61600]] commercial items or commercial components (see 212.504(a)(xxii)). * * * * * 247.572-2 [Amended] 115. Section 247.572-2 is amended by removing at the end of paragraph (a)(4) the word ``and''; by removing the period at the end of paragraph (a)(5) and inserting a semicolon and the word ``and'' in its place; and by adding a new paragraph (a)(6) to read as follows: 247.572-2 Direct purchase of ocean transportation services. (a) * * * (6) Subcontracts under Government contracts or agreements for ocean transportation services. * * * * * PART 249--TERMINATION OF CONTRACTS 249.7002 [Amended] 116. Section 249.7002 is amended in paragraph (b) introductory text by revising the phrase ``Office of Economic Adjustment (OEA), Assistant Secretary of Defense (Force Management and Personnel)'' to read ``Assistant Secretary of Defense (Economic Security), Office of Economic Adjustment (OEA''; and in paragraph (b)(2) by revising the Telefax number to read ``(703) 604-5843.'' PART 250--EXTRAORDINARY CONTRACTUAL ACTIONS 117. Section 250.201-70 is amended by revising in paragraph (b)(1) the phrase ``Under Secretary of Defense (Acquisition) (USD(A))'' to read ``Under Secretary of Defense (Acquisition & Technology) (USDA&T))''; and by revising in paragraph (b)(2) the phrase ``USD(A)'' to read ``USD(A&T).'' PART 252--SOLICITATION PROVISIONS AND CONTRACT CLAUSES 118. Section 252.203-7000 is amended by revising the clause date to read ``(NOV 1995)'' and by revising paragraph (a)(3) to read as follows: 252.203-7000 Statutory prohibitions on compensation to former Department of Defense employees. * * * * * * * (a) * * * (3) Defense contractor means an entity (including affiliates and subsidiaries which clearly engage in the performance of Department of Defense (DoD) contracts) that contracts directly with the DoD to supply goods or services. ``Defense contractor'' does not include a State or local government or any person who contracts to supply the Department of Defense only commercial items. * * * * * 119. Section 252.203-7001 is amended by revising the clause date to read ``(NOV 1995)'' and by revising paragraph (g) to read as follows: 252.203-7001 Special prohibition on employment. * * * * * (g) The Contractor agrees to include the substance of this clause, appropriately modified to reflect the identity and relationship of the parties, in all first-tier subcontracts exceeding the simplified acquisition threshold in part 13 of the Federal Acquisition Regulation, except those for commercial items or components. * * * * * 252.203-7003 [Removed] 120. Section 252.203-7003 is removed. 252.204-7001 [Amended] 121. Section 252.204-7001 is amended by revising in the introductory text the reference ``204.603-70'' to read ``204.602-70.'' 122. Section 252.209-7000 is amended by revising the clause date to read ``(NOV 1995)'' and by revising paragraph (b) to read as follows: 252.209-7000 Acquisition from subcontractors subject to on-site inspection under the Intermediate-Range Nuclear Forces (INF) Treaty. * * * * * (b) The Contractor shall incorporate this clause, including this paragraph (b), in all solicitations and contracts exceeding the simplified acquisition threshold in part 13 of the Federal Acquisition Regulation, except those for commercial items. 252.209-7007 [Amended] 123. Section 252.209-7007 is redesignated as 252.209-7005; the clause date is revised to read ``(NOV 1995)''; the title of paragraph (a) is revised to read ``Definition''; and paragraph (b) is revised to read as follows: 252.209-7005 Military recruiting on campus. * * * * * (b) General. An institution of higher education that has been determined, using procedures established by the Secretary of Defense to implement section 558 of Pub. L. 103-337, (1) to have a policy of denying, or (2) to prevent effectively the Secretary of Defense from obtaining for military recruiting purposes, entry to their campuses, access to students on campuses, or access to directory information pertaining to students, is ineligible for contract award and payments under existing contracts. In addition, the Government shall terminate this contract for the Contractor's material failure to comply with the terms and conditions of award. * * * * * 252.210-7000 [Amended] 124. Sections 252.211-7000 through 252.211-7021 are removed and Section 252.210-7000 is redesignated as 252.211-7003 and the introductory text is revised to read ``As prescribed in 211.270-2, use the following provision:''. 252.210-7001 [Amended] 125. Section 252.210-7001 is redesignated as 252.211-7001 and the introductory text is revised to read ``As prescribed in 211.204(c), use the following provision:''. 252.210-7002 [Amended] 126. Section 252.210-7002 is redesignated as 252.211-7002 and the introductory text is revised to read ``As prescribed in 211.204(c), use the following provision:''. 252.210-7003 [Amended] 127. Section 252.210-7003 is redesignated as 252.211-7000 and the introductory text is revised to read ``As prescribed in 211.002-70, use the following clause:''. 252.210-7004 [Amended] 128. Section 252.210-7004 is redesignated as 252.211-7004 and the introductory text is revised to read ``As prescribed in 211.272, use the following provision:''. 129-130. Sections 252.212-7000 and 252.212-7001 are added to read as follows: 252.212-7000 Offeror representations and certifications--Commercial items. As prescribed in 212.301(f)(iii), use the following provision: OFFEROR REPRESENTATIONS AND CERTIFICATIONS--COMMERCIAL ITEMS (NOV 1995) (a) Definitions. As used in this clause-- (1) Foreign person means any person other than a United States person as defined in Section 16(2) of the Export Administration Act of 1979 (50 U.S.C. App. Sec. 2415). (2) United States person is defined in Section 16(2) of the Export Administration Act of 1979 and means any United States resident or national (other than an individual resident outside the United States and employed by other than a United States person), any domestic concern (including any permanent domestic establishment of any foreign concern), and any foreign subsidiary or affiliate (including any permanent foreign establishment) of any domestic concern which is controlled in fact by such domestic concern, as determined under regulations of the President. [[Page 61601]] (b) Certification. By submitting this offer, the Offeror, if a foreign person, company or entity, certifies that it-- (1) Does not comply with the Secondary Arab Boycott of Israel; and (2) Is not taking or knowingly agreeing to take any action, with respect to the Secondary Boycott of Israel by Arab countries, which 50 U.S.C. App. Sec. 2407(a) prohibits a United States person from taking. (c) Representation of Extent of Transportation by Sea. (This representation does not apply to solicitations for the direct purchase of ocean transportation services). (1) The Offeror shall indicate by checking the appropriate blank in paragraph (c)(2) of this provision whether transportation of supplies by sea is anticipated under the resultant contract. The term ``supplies'' is defined in the Transportation of Supplies by Sea clause of this solicitation. (2) Representation. The Offeror represents that it-- ______Does anticipate that supplies will be transported by sea in the performance of any contract or subcontract resulting from this solicitation. ______ Does not anticipate that supplies will be transported by sea in the performance of any contract or subcontract resulting from this solicitation. (3) Any contract resulting from this solicitation will include the Transportation of Supplies by Sea clause. If the Offeror represents that it will not use ocean transportation, the resulting contract will also include the Defense Federal Acquisition Regulation Supplement clause at 252.247-7024, Notification of Transportation of Supplies by Sea. (End of provision) 252.212-7001 Contract terms and conditions required to implement statutes or Executive Orders applicable to Defense acquisitions of commercial items. As prescribed in 212.301(f)(iv), use the following clause: CONTRACT TERMS AND CONDITIONS REQUIRED TO IMPLEMENT STATUTES OR EXECUTIVE ORDERS APPLICABLE TO DEFENSE ACQUISITIONS OF COMMERCIAL ITEMS (NOV 1995) (a) The Contractor agrees to comply with the Defense Federal Acquisition Regulation Supplement (DFARS) clause 252.247-7023, Transportation of Supplies by Sea, which is included in this contract by reference to implement 10 U.S.C. 2631. (b) The Contractor agrees to comply with any clause that is checked on the following list of DFARS clauses which, if checked, is included in this contract by reference to implement provisions of law or Executive Orders applicable to acquisitions of commercial items or components. ______ 252.205-7000 Provision of Information to Cooperative Agreement Holders (10 U.S.C. 2416). ______ 252.206-7000 Domestic Source Restriction (10 U.S.C. 2304). ______ 252.219-7001 Notice of Partial Small Business Set-Aside with Preferential Consideration for Small Disadvantaged Business Concerns (____ Alternate I) (Section 9004, Pub. L. 101-165 (10 U.S.C. 2301 (repealed) note)). ______ 252.219-7002 Notice of Small Disadvantaged Business Set- Aside (____ Alternate I) (15 U.S.C. 644). ______ 252.219-7003 Small Business and Small Disadvantaged Business Subcontracting Plan (DoD Contracts) (15 U.S.C. 637). ______ 252.219-7005 Incentive for Subcontracting with Small Businesses, Small Disadvantaged Businesses, Historically Black Colleges and Universities and Minority Institutions (____ Alternate I) (Section 9004, Pub. L. 101-165 (10 U.S.C. 2301 (repealed) note)). ______ 252.219-7006 Noice of Evaluation Preference for Small Disadvantaged Business Concerns (____ Alternate I) (15 U.S.C. 644). ______ 252.225-7001 Buy American Act and Balance of Payment Program (41 U.S.C. 10, E.O. 10582). ______ 252.225-7007 Trade Agreements (10 U.S.C. 2501-2582). ______ 252.225-7012 Preference for Certain Domestic Commodities. ______ 252.225-7014 Preference for Domestic Speciality Metals (10 U.S.C. 2241 note). ______ 252.225-7015 Preference for Domestic Hand or Measuring Tools (10 U.S.C. 2241 note). ______ 252.225-7017 Preference for United States and Canadian Valves and Machine Tools (10 U.S.C. 2534(c)(2)). ______ 252.225-7027 Limitation on Sales Commissions and Fees (12 U.S.C. 2779). ______ 252.225-7028 Exclusionary Policies and Practices of Foreign Governments (22 U.S.C. 2755). ______ 252.225-7029 Restriction on Acquisition of Air Circuit Breakers (10 U.S.C. 2534(a)(3)). ______ 252.225-7036 North American Free Trade Agreement Implementation Act. ______ 252.227-7015 Technical Data--Commercial Items (10 U.S.C. 2320). ______ 252.227-7037 Validation of Restrictive Markings on Technical Data (10 U.S.C. 2321). ______ 252.233-7000 Certification of Claims and Requests for Adjustment or Relief (10 U.S.C. 2410). ______ 252.242-7002 Submission of Commercial Freight Bills for Audit (31 U.S.C. 3726). ______ 252.247-7024 Notification of Transportation of Supplies by Sea (10 U.S.C. 2631). ______ 252.249-7001 Notification of Substantial Impact on Employment (10 U.S.C. 2501 note). (End of clause) 252.215-7001 [Removed and Reserved] 131. Section 252.215-7001 is removed and reserved. 132. Section 252.217-7026 is amended by revising the clause date to read ``(NOV 1995)'' and revising paragraph (3) of the table to read as follows: 252.217-7026 Identification of sources of supply. * * * * * (b) * * * (3) Use ``Y'' if the item is a commercial item; otherwise use ``N.'' If ``Y'' is listed, the Offeror need not complete the remaining columns in the table. * * * * * 133. Section 252.219-7003 is amended by revising the title; by revising the clause date to read ``(NOV 1995)''; by revising the introductory text of the clause and by revising in paragraph (b) the word ``products'' to read ``items'' as follows: 252.219-7003 Small, small disadvantaged and women-owned small business subcontracting plan (DoD contracts). * * * * * This clause supplements the Federal Acquisition Regulation 52.219-9, Small, Small Disadvantaged and Women-Owned Small Business Subcontracting Plan, clause of this contract. * * * * * 252.219-7005 [Amended] 134. Section 252.219-7005 is amended by revising the clause date to read ``(NOV 1995)'' and by revising in paragraph (d) the word ``products'' to read ``items.'' 135. Section 252.223-7006, ALTERNATE I, is amended by revising the date to read ``(NOV 1995)''; by revising in paragraph (c) the word ``material'' to read ``materials''; and by revising paragraph (d) to read as follows: 252.223-7006 Prohibition on storage and disposal of toxic and hazardous materials. * * * * * ALTERNATE I (NOV 1995) * * * * * (d) The Contractor shall include this clause, including this paragraph (d), in each subcontract which requires, may require, or permits a subcontractor to treat or dispose of non-DoD-owned toxic or hazardous materials as defined in this clause. 136-137. Section 252.225-7012 is amended by revising the clause date to read ``(NOV 1995)''; by removing the word ``or'' at the end of paragraph (b)(2); by removing the period at the end of paragraph (b)(3) and adding a semicolon and the word ``or'' in its place; and by adding a new paragraph (b)(4) to read as follows: [[Page 61602]] 252.225-7012 Preference for certain domestic commodities. * * * * * (b) * * * (4) To commercial items or components purchased from subcontractors or suppliers. 138. Section 252.225-7014 is amended by revising the clause date to read ``(NOV 1995)''; by revising in paragraph (c)(2) the acronym ``FAR'' to read ``Federal Acquisition Regulation''; by removing the word ``or'' at the end of paragraph (c)(2); by removing the period at the end of paragraph (c)(3) and adding a semicolon and the word ``or'' in its place; and by adding a new paragraph (c)(4) to read as follows: 252.225-7014 Preference for domestic specialty metals. * * * * * (c) * * * (4) The specialty metal is contained in a commercial item or component purchased from subcontractors or suppliers. * * * * * 139. Section 252.225-7016 is amended by revising the clause date to read ``(NOV 1995)'' and by revising paragraph (b) to read as follows: 252.225-7016 Restriction on acquisition of antifriction bearings. * * * * * (b) The restriction in paragraph (a) does not apply to the extent that the end items or components containing antifriction bearings are commercial items. The commercial item exception does not include items designed or developed under a Government contract or contracts where the end item is bearings and bearing components. * * * * * 140. Section 252.225-7026 is amended by revising the clause date to read ``(NOV 1995)'' and by revising paragraph (c)(1) to read as follows: 252.225-7026 Reporting of contract performance outside the United States. * * * * * (c) * * * (1) The Contractor shall include a clause substantially the same as this one in all first-tier subcontracts exceeding $100,000, except subcontracts for commercial items, construction, ores, natural gases, utilities, petroleum products and crudes, timber (logs), or subsistence. * * * * * 252.225-7040 [Amended] 141. Section 252.225-7040 is amended by revising in the introductory text the reference ``225.7004-5(c)'' to read ``225.7004- 6(c).'' 142. Section 252.227-7013 is amended by revising the clause date to read ``(NOV 1995)'' and by revising paragraph (k)(2) to read as follows: 252.227-7013 Rights in technical data--Noncommercial items. * * * * * (k) * * * (1) * * * (2) Whenever any technical data for noncommercial items is to be obtained from a subcontractor or supplier for delivery to the Government under this contract, the Contractor shall use this same clause in the subcontract or other contractual instrument, and require its subcontractors or suppliers to do so, without alteration, except to identify the parties. No other clause shall be used to enlarge or diminish the Government's, the Contractor's, or a higher-tier subcontractor's or supplier's rights in a subcontractor's or supplier's technical data. * * * * * 143. Section 252.227-7015 is amended by revising the clause date to read ``(NOV 1995)'' and by revising paragraph (a) to read as follows: 252.227-7015 Technical data--Commercial items. * * * * * (a) Definitions. As used in this clause: (1) Commercial item does not include commercial computer software. (2) Form, fit, and function data means technical data that describes the required overall physical, functional, and performance characteristics (along with the qualification requirements, if applicable) of an item, component, or process to the extent necessary to permit identification of physically and functionally interchangeable items. (3) The term item includes components or processes. (4) Technical data means recorded information, regardless of the form or method of recording, of a scientific or technical nature (including computer software documentation). The term does not include computer software or data incidental to contract administration, such as financial and/or management information. * * * * * 252.227-7018 [Amended] 144. Section 252.227-7018 is amended in the title by revising the word ``Innovative'' to read ``Innovation''; and by revising in the clause title the word ``Innovative'' to read ``Innovation.'' 145. Section 252.227-7037 is amended by revising the clause date to read ``(NOV 1995)'' and by revising paragraph (l) to read as follows: 252.227-7037 Validation of restrictive markings on technical data. * * * * * (l) Flowdown. The Contractor or subcontractor agrees to insert this clause in contractual instruments with its subcontractors or suppliers at any tier requiring the delivery of technical data, except contractual instruments for commercial items or commercial components. 252.231-7001 [Removed] 146. Section 252.231-7001 is removed. 252.237-7020 [Removed and Reserved] 147. Section 252.237-7020 is removed and reserved. 252.237-7021 [Removed and Reserved] 148. Section 252.237-7021 is removed and reserved. 149. Section 252.239-7010 is amended by revising the clause date to read ``(NOV 1995)''; by revising paragraph (a) introductory text; and by revising paragraph (b) to read as follows: 252.239-7010 Audit and records--Common carriers. * * * * * (a) For the purpose of verifying the accuracy of the cost or pricing data submitted under the Submission of Cost or Pricing Data--Common Carriers clause of this agreement/contract, the Contracting Officer or authorized representative shall have the right to examine the Contractor's records, the computations and projections used, and other supporting data, as defined in 4.703(a) of the Federal Acquisition Regulation, which will permit adequate evaluation of the cost or pricing data. This right applies to cost and pricing data which were available to the Contractor as of the date of the certification and shall last-- * * * * * (b) The Contractor shall maintain records and other evidence, and accounting procedures and practices, sufficient to show the direct and indirect costs which were the basis for pricing the communication service authorization. * * * * * 252.242-7001 [Removed and Reserved] 150. Section 252.242-7001 is removed and reserved. 151. Section 252.247-7023 is amended by revising the clause date to read ``(NOV 1995)'' by revising paragraph (a)(5); and by revising paragraph (g) to read as follows: 252.247-7023 Transportation of supplies by sea. * * * * * (a) * * * (5) Subcontractor means a supplier, materialman, distributor, or vendor at any level below the prime contractor whose contractual obligation to perform results from, or is conditioned upon, award of the prime contract and who is performing any part of the work or other requirement of the prime contract. However, effective May 1, 1996, the term does not include a supplier, materialman, distributor, or vendor of commercial items or commercial components. * * * * * [[Page 61603]] (g) The Contractor shall include this clause, including this paragraph (g) in all subcontracts under this contract, which exceed the simplified acquisition threshold in Part 13 of the Federal Acquisition Regulation. 152. Section 252.247-7024 is amended by revising the clause date to read ``(NOV 1995)'' and by revising paragraph (b) to read as follows: 252.247-7024 Notification of transportation of supplies by sea. * * * * * (b) The Contractor shall include this clause, including this paragraph (b), revised as necessary to reflect the relationship of the contracting parties, in all subcontracts hereunder, except (effective May 1, 1996) subcontracts for the acquisition of commercial items or components. PART 253--FORMS 153. Section 253.204-70 is revised to read as follows: 253.204-70 DD Form 350, Individual Contracting Action Report. Policy on use of a DD Form 350 is in 204.670-2. This subsection 253.204-70 contains instructions for completion of Parts A through F of the DD Form 350. Paragraph (g) of this subsection contains special instructions for completing a DD Form 350 for an action of $25,000 or less under the Small Business Competitiveness Demonstration Program. (a) Part A of the DD Form 350. Part A identifies the report and the reporting activity. Complete all four blocks. (1) BLOCK A1, TYPE OF REPORT. Enter one of three codes. (i) Code 0-Original. Enter code 0 unless 1 or code 2 applies. (ii) Code 1-Cancelling. A cancelling action cancels an existing DD Form 350 in accordance with departmental data collection point instructions. (iii) Code 2-Correcting. A correcting action corrects an existing DD Form 350 action in accordance with departmental data collection point instructions. (2) BLOCK A2, REPORT NO. Enter the four digit local control number (see 204.670-3(a)(4)). If Block A1 is coded 1 or 2, use the prior report number rather than a new one. (3) BLOCK A3, CONTRACTING OFFICE CODE. Enter the code assigned the contracting office by the departmental data collection point in 204.670-1(c). (4) BLOCK A4, NAME OF CONTRACTING OFFICE. Enter sufficient detail to establish the identity of the contracting office. (b) Part B of the DD Form 350. Part B identifies the transaction. (1) BLOCK B1, CONTRACT NUMBER. (i) Enter-- (A) The DoD contract number; or (B) For orders under contracts awarded by other Federal agencies, the contract number of that Federal agency as it appears in the contractual instrument. (ii) Do not leave spaces between characters, and do not enter dashes, slants, or any other punctuation marks. (iii) The DoD contract number is the basic (13 alphanumeric character) procurement instrument identification number (PIIN) that was assigned in accordance with 204.7001 or constructed under an exception permitted by 204.7000. Do not enter any supplementary procurement instrument numbers as part of the contract number (these go in Block B2). (2) BLOCK B2, MOD. ORDER OR OTHER ID NUMBER. Enter the supplemental procurement identification number (if there is one) that was assigned in accordance with 204.7004 or as permitted by 204.7000. It can be up to 19 characters. Usually calls and orders have a four-position number (see 204.7004-4) and modifications (including modifications of calls or orders) have a six-position modification number (see 704.7003 or 204.7004(b)). (3) BLOCK B3, ACTION DATE. (i) Enter the year, month, and day of the effective date for fiscal obligation purposes. When contract actions are awarded contingent on the availability of funds, enter the date funds are obligated. (ii) Enter each segment as a two digit number. Use 01 through 12 for January through December. For example, enter January 2, 1999 as 990102. (4) BLOCK B4, COMPLETION DATE. (i) Enter the year, month, and day of the last contract delivery date or the end of the performance period. (ii) Enter each segment as a two digit number. Use 01 through 12 for January through December. For example, enter January 2, 1999 as 990102. (5) BLOCK B5, CONTRACTOR IDENTIFICATION INFORMATION. (i) Use data that relates to the contractor whose name and address appears in the contract document (Block 7 of the SF 26, Award/Contract; Block 8 of the SF 30, Amendment of Solicitation/Modification of Contract; Block 15A of the SF 33, Solicitation, Offer and Award; or Block 9 of the DD Form 1155, Order for Supplies or Services), except-- (A) For contracts placed with the Small Business Administration under Section 8(a) of the Small Business Act, use data that relates to the company that will be performing the work. (B) For orders placed against a contract awarded by another agency, also use data that relates to the company that will be performing the work. (C) For Federal supply schedule orders, use data that applies to the contractor whose name appears on the schedule (not the data for the agent to whom orders may be sent). (D) For contracts with the Canadian Commercial Corporation (CCC), use data for the appropriate CCC office, except as noted in Block B5B. (ii) Block B5 has seven parts. Some of the parts may not apply to the action being reported. (A) BLOCK B5A, ESTABLISHMENT CODE. Enter the contractor's 9-position contractor establishment code (CEC). If CEC is not available within the contracting activity, use the procedures at 204.7202-2 to obtain one. (B) BLOCK B5B, CAGE CODE. Enter the 5-position commercial and Government entity (CAGE) code that identifies the contractor plant or establishment. If the CAGE code is not already available in the contracting office and the apparent awardee does not respond to the provision at 252.204-7001, Commercial and Government Entity (CAGE) Code Reporting, use the procedures as 204.7202-1 to obtain one. (C) BLOCK B5C, CONTRACTOR NAME AND DIVISION NAME. Enter the contractor's name. Include its division name. (D) BLOCK B5D, CONTRACTOR ADDRESS. Enter the contractor's address. Include street address (and/or P.O. Box), city/town, state/country, and ZIP code, if applicable. Do not enter foreign postal codes. (E) BLOCK B5E, TIN. Enter the contractor's taxpayer identification number (see FAR Subpart 4.9). Leave Block B5E blank if the contractor is-- (1) A nonresident alien, foreign corporation, or foreign partnership that does not have income effectively connected with the trade or business in the United States; and does not have an office or place of business or a fiscal paying agent in the United States; (2) An agency or instrumentality of a foreign government; or (3) An agency or instrumentality of a Federal, State, or local government. (F) BLOCK B5F, PARENT TIN. Enter the contractor's parent company (common parent) TIN (see FAR 4.9 and 52.204-3). If the contractor does not have a parent company or the parent [[Page 61604]] company meets the exemption for Block B5E, leave Block B5F blank. (G) BLOCK B5G, PARENT NAME. If a parent TIN is entered in Block B5F, enter in Block B5G the name of the parent company (common parent). Leave Block B5G blank if there is no parent company or the parent company is exempted from the requirement to have a TIN. (6) BLOCK B6, PRINCIPAL PLACE OF PERFORMANCE. (i) The place, or places, where the contract will be performed may be specified by the Government or listed by the contractor in response to the solicitation provision at FAR 52.214-14, Place of Performance-- Sealed Bidding, or FAR 52.215-20, Place of Performance. Use data for the contractor's principal place of performance, which is generally the-- (A) Final assembly point for supply contracts with manufacturers. (B) Dealer's location for supply contracts with regular dealers (FAR 22.601) where shipment is made from stock. (C) Subcontractor's location for supply contracts with regular dealers (FAR 22.601) where shipment is made from a subcontractor's plant. (D) Actual construction site for construction contracts. (E) Planned construction site for architect-engineer contracts. (F) Place of mining for mined supplies. (G) Place (including military installations) where a service is performed for service contracts. (ii) When there is more than one location for any of paragraphs (i)(A) through (G) (e.g., more than one construction site), use the location involving the largest dollar amount of the acquisition. Do not show more than one location in Block B6. (iii) If places of performance are too varied or not known, or if commercial procedures were used, enter the contractor's home office location. (iv) Follow the instructions for each part of Block 6 which applies to the action being reported. (A) BLOCK B6A, CITY OR PLACE CODE. (1) For places in the United States and outlying areas, enter the numeric place code, which can be found in the Federal Information Processing Standards (FIPS) Publication (PUB) 55-2, (``Guideline: Codes for named Populated Places, Primary Country Divisions, and Other Locational Entities of the United States and Outlying Areas''). Leave Block B6A blank for places outside the United States and outlying areas. (2) If the city or locality is not listed, look in FIPS PUB 55-2 for the county code of the principal place of performance. Enter that in Block B6A. Use 50000 for Washington, DC, with a State code of 11. (3) Paragraph 5.2, Entry Selection With the Aid of the Class Code, of FIPS PUB 55-2 will help in selecting the correct code. Sometimes, a class code should be used in addition to a place code to accurately identify the place of performance. Do not use place codes where the first position of the class code is X or Z. (B) BLOCK B6B, STATE OR COUNTRY CODE. (1) For places in the United States and outlying areas, enter the numeric State code, which can be found in FIPS PUB 55-2 or FIPS PUB 5- 2, Codes for the Identification of the States, the District of Columbia and the Outlying Areas of the United States and Associated Areas. (2) For places outside the United States and outlying areas, enter the alpha country code from FIPS PUB 10-3, Countries, Dependencies, Areas of Special Sovereignty, and Their Principal Administrative Divisions. (C) BLOCK B6C, CITY OR PLACE AND STATE OR COUNTRY NAME. Enter the name of the principal place of performance. Do not leave Block B6C blank. (7) BLOCK B7, TYPE OBLIGATION. Enter one of two codes. (i) Code 1--Obligation. Enter code 1 if the contracting action obligates funds. (ii) Code 2--Deobligation. Enter code 2 if the contracting action deobligates funds. (8) BLOCK B8, TOTAL DOLLARS. Enter the net amount of funds (whole dollars only) obligated or deobligated by the contracting action. Do not leave Block B8 blank. (9) BLOCK B9, FOREIGN MILITARY SALE. Enter one of the two codes. If only part of the contracting action is foreign military sale, separately report the parts (see 204.670- 6(c)). (i) Code Y--Yes. Enter code Y when the contracting action is under a foreign military sales arrangement, or under any other arrangement where a foreign country or international organization is bearing the cost of the acquisition. (ii) Code N--No. Enter code N when code Y does not apply. (10) BLOCK B10, MULTIYEAR CONTRACT. Enter one of the two codes. (i) Code Y--Yes. Enter code Y when the contracting action is a multiyear contract under FAR Subpart 17.1. (ii) Code N--No. Enter code N when code Y does not apply. (11) BLOCK B11, TOTAL MULTIYEAR VALUE. (i) Complete Block B11 if the contracting action is-- (A) A multiyear contract (B10 is coded Y); and (B) Either a new letter contract or a new definitive contract (Block B13 is coded 1 or 3). Otherwise, leave Block B11 blank. (ii) Enter the estimated multiyear contract value (whole dollars only). (12) BLOCK B12, PRINCIPAL PRODUCT OR SERVICE. B12 contains five parts. Do not leave any blocks blank. (i) BLOCK B12A, FSC or SVC CODE. Enter the 4-character federal stock class or service code that describes the contract effort. To find the code, look in Section 1 of the Department of Defense (DoD) Procurement Coding Manual (MN02). There are three categories of codes to choose from. In some cases, use a 4- character code from a list of 4-character codes; in other cases, construct a code using the instructions in the Manual. If more than one category or code applies to the contract action, enter the one that best identifies the product or service representing the largest dollar value. (A) Supplies. If the contracting action is for the purchase (not lease or rental) of supplies, enter a federal supply classification (FSC) code in Block B12A. FSC codes are all numeric. Look in Section 1, Part C, of the DoD Procurement Coding Manual (MN02). The Department of Defense Federal Supply Classification Cataloging Handbooks H2-1, H2-2, and H2-3 may also help with the correct 4-character code. (B) Services. If the contracting action is for services (except research, development, test, and evaluation), construction, or lease or rental of equipment or facilities, enter a service code in Block B12A. (C) Research, Development, Test and Evaluation (RDT&E). If the contracting action is for RDT&E (as defined in FAR 35.001 and 235.001), enter an RDT&E code in Block B12A. Look in Section 1, Part A of the DoD Procurement Coding Manual (MN02). All RDT&E codes should begin with the letter ``A''. Do not use an RDT&E code for-- (1) Purchase, lease, or rental of equipment, supplies, or services separately purchased in support of RDT&E work, even if RDT&E funds are cited. Instead, use an FSC or Service code under the instructions in paragraphs (i)(A) or (B). (2) Orders under Federal supply schedule contracts. Instead use an FSC or Service code under the instructions in paragraphs (i)(A) or (B). [[Page 61605]] (ii) BLOCK B12B, DOD CLAIMANT PROGRAM CODE. Enter a code that identifies the commodity described in Block B12E. These codes are in Section III of the DoD Procurement Coding Manual (MN02). If more than one code applies to the contracting act [Text truncated at 120,000 characters. The full text is on the page linked above.] --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/fr%3A95-29187. Public record. Not legal advice.