Federal Acquisition Regulation; Electronic Contracting

DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Parts 5, 14, 15, and 52

[FAC 90-46; FAR Case 91-104; Item II]

RIN 9000-AF50

Federal Acquisition Regulation; Electronic Contracting

AGENCIES: Department of Defense (DOD), General Services Administration

(GSA), and National Aeronautics and Space Administration (NASA).

ACTION: Final rule.

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SUMMARY: The Civilian Agency Acquisition Council and the Defense

Acquisition Regulations Council have agreed on a final rule amending

the Federal Acquisition Regulation (FAR) to address the use of

electronic commerce/electronic data interchange in Government

contracting. This regulatory action was not subject to Office of

Management and Budget review under Executive Order 12866, dated

September 30, 1993. This is not a major rule under 5 U.S.C. 804.

DATES: Effective May 16, 1997.

FOR FURTHER INFORMATION CONTACT: Mr. Ralph DeStefano at (202) 501-1758

in reference to this FAR case. For general information, contact the FAR

Secretariat, Room 4037, GS Building, Washington, DC 20405 (202) 501-

4755. Please cite FAC 90-46, FAR case 91-104.

SUPPLEMENTARY INFORMATION:

A. Background

A proposed rule was published in the Federal Register at 58 FR

69588, December 30, 1993. The rule proposed amendments to the FAR to

remove any barriers to the use of electronic data interchange in

Government contracting. Thirty-six comments from ten respondents were

received during the public comment period. After evaluating the public

comments, the Councils agreed to publish another proposed rule as a

result of significant changes to the previous proposed rule being

deemed necessary. The revised proposed rule was published in the

Federal Register at 60 FR 12384, March 6, 1995, and an interim rule was

published at 60 FR 34735, July 3, 1995. Additional changes to the final

rule include--

--Revisions at FAR 5.101(a)(2)(iv) to clarify requirements for

electronic posting of solicitations;

--Revisions at FAR 14.209(b) to clarify procedures for informing

bidders of cancellation of electronic invitations before opening; and

--Clarification of when electronic bids and proposals will be

considered to have been received by the Government for the purposes of

the late bid and late proposal rules in various clauses within FAR Part

52.

This rule complements the FACNET rule (FAR Case 94-770; 61 FR

39189, July 26, 1996), which implemented provisions of the Federal

Acquisition Streamlining Act of 1994 (FASA) (Pub. L. 103-355) and the

Clinger-Cohen Act of 1996 (Pub. L. 104-106).

B. Regulatory Flexibility Act

A Final Regulatory Flexibility Analysis (FRFA) has been performed

and will be provided to the Chief Counsel for Advocacy of the Small

Business Administration. A copy of the FRFA may be obtained from the

FAR Secretariat. The FRFA is summarized as follows:

This final rule authorizes the use of electronic commerce/

electronic data interchange in Government contracting. The legal

authority to use electronic commerce for Government contracting

actions was confirmed in General Accounting Office (GAO) Advisory

Opinion B-238449. The rule will apply to all actual or potential

bidders or offerors, large and small, when the solicitation

authorizes the use of electronic commerce/electronic data

interchange. It is estimated that the rule will apply to at least

8,615,190 small entities. There are no significant alternatives

which would accomplish the objectives of the rule.

C. Paperwork Reduction Act

The Paperwork Reduction Act does not apply because the changes to

the FAR do not impose recordkeeping or information collection

requirements, or collections of information from offerors, contractors,

or members of the public which require the approval of the Office of

Management and Budget under 44 U.S.C. 3501, et seq.

List of Subjects in 48 CFR Parts 5, 14, 15, and 52

Government procurement.

Dated: March 7, 1997.

Edward C. Loeb,

Director, Federal Acquisition Policy Division.

Therefore, 48 CFR Parts 5, 14, 15, and 52 are amended as set forth

below:

1. The authority citation for 48 CFR Parts 5, 14, 15, and 52

continues to read as follows:

Authority: 40 U.S.C. 486(c); 10 U.S.C. chapter 137; and 42

U.S.C. 2473(c).

PART 5--PUBLICIZING CONTRACT ACTIONS

2. Section 5.101 is amended by revising the first sentence of

paragraph (a)(2)(iv) to read as follows:

5.101 Methods of disseminating information.

* * * * *

(a) * * *

(2) * * *

(iv) Electronic posting of requirements in a place accessible by

the general public at the Government installation may be used to

satisfy the public display requirement. * * *

* * * * *

PART 14--SEALED BIDDING

3. Section 14.209 is amended by revising paragraph (b) to read as

follows:

14.209 Cancellation of invitations before opening.

* * * * *

(b) When an invitation issued other than electronically is

cancelled, bids that have been received shall be returned unopened to

the bidders and notice of cancellation shall be sent to all prospective

bidders to whom invitations were issued. When an invitation issued

electronically is cancelled, a general notice of cancellation shall be

posted electronically, the bids received shall not be viewed, and the

bids shall be purged from primary and backup data storage systems.

* * * * *

4. Section 14.304-1 is amended by revising paragraph (a)(4) to read

as follows:

[[Page 12693]]

14.304-1 General.

* * * * *

(a) * * *

(4) It was transmitted through an electronic commerce method

authorized by the solicitation and was received at the initial point of

entry to the Government infrastructure not later than 5:00 p.m. one

working day prior to the date specified for receipt of bids.

* * * * *

PART 15--CONTRACTING BY NEGOTIATION

5. Section 15.410 is amended by revising the second and third

sentences of paragraph (b) to read as follows:

15.410 Amendment of solicitations before closing date.

* * * * *

(b) * * * If the time available before closing is insufficient,

prospective offerors or quoters shall be notified by electronic data

interchange, facsimile transmission, telegram, or telephone of an

extension of the closing date. Telephonic, facsimile, and telegraphic

notices shall be confirmed in the written amendment to the

solicitation. * * *

* * * * *

PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

6. Section 52.214-7 is amended by revising the provision date, and

paragraph (a)(4) to read as follows:

52.214-7 Late Submissions, Modifications, and Withdrawals of Bids.

* * * * *

Late Submissions, Modifications, and Withdrawals of Bids (May 1997)

(a) * * *

(4) Was transmitted through an electronic commerce method

authorized by the solicitation and was received at the initial point

of entry to the Government infrastructure not later than 5:00 p.m.

one working day prior to the date specified for receipt of bids.

* * * * *

7. Section 52.214-23 is amended by revising the provision date, and

paragraph (a)(4) to read as follows:

52.214-23 Late Submissions, Modifications, and Withdrawals of

Technical Proposals under Two-Step Sealed Bidding.

* * * * *

Late Submissions, Modfications, and Withdrawals of Technical Proposals

Under Two-Step Sealed Bidding (MAY 1997)

(a) * * *

(4) Was transmitted through an electronic commerce method

authorized by the solicitation and was received at the initial point

of entry to the Government infrastructure not later than 5:00 p.m.

one working day prior to the date specified for receipt of technical

proposals; or

* * * * *

8. Section 52.214-32 is amended by revising the date of the

provision, and paragraph (a)(2) to read as follows:

52.214-32 Late Submissions, Modifications, and Withdrawals of Bids

(Overseas).

* * * * *

Late Submissions, Modifications, and Withdrawals of Bids (Overseas)

(May 1997)

(a) * * *

(2) Was transmitted through an electronic commerce method

authorized by the solicitation and was received at the initial point

of entry to the Government infrastructure not later than 5:00 p.m.

one working day prior to the date specified for receipt of bids. The

term ``working day'' excludes weekends and U.S. Federal holidays.

* * * * *

9. Section 52.214-33 is amended by revising the clause date, and

paragraph (a)(2) to read as follows:

52.214-33 Late Submissions, Modifications, and Withdrawals of

Technical Proposals Under Two-Step Sealed Bidding (Overseas).

* * * * *

Late Submissions, Modifications, and Withdrawals of Technical Proposals

Under Two-Step Sealed Bidding (May 1997)

(a) * * *

(2) Was transmitted through an electronic commerce method

authorized by the solicitation and was received at the initial point

of entry to the Government infrastructure not later than 5:00 p.m.

one working day prior to the date specified for receipt of technical

proposals. The term ``working day'' excludes weekends and U.S.

Federal holidays; or

* * * * *

10. Section 52.215-10 is amended by revising the provision date and

paragraph (a)(4) to read as follows:

52.215-10 Late Submissions, Modifications, and Withdrawals of

Proposals.

* * * * *

Late Submissions, Modifications, and Withdrawals of Proposals (May

1997)

(a) * * *

(4) It was transmitted through an electronic commerce method

authorized by the solicitation and was received at the initial point

of entry to the Government infrastructure not later than 5:00 p.m.

one working day prior to the date specified for receipt of

proposals;

* * * * *

11. Section 52.215-15 is revised to read as follows:

52.215-15 Failure to Submit Offer.

As prescribed in 15.407(d)(3), insert the following provision:

Failure to Submit Offer (May 1997)

Recipients of this solicitation not responding with an offer

should not return this solicitation, unless it specifies otherwise.

Instead, for paper transactions, they should advise the issuing

office by letter, postcard, or established electronic commerce

methods, whether they want to receive future solicitations for

similar requirements. Electronic solicitations do not require

notification of desire to receive future solicitations, since these

solicitations will be openly available to any interested party. If a

recipient does not submit an offer and does not notify the issuing

office that future solicitations are desired, the recipient's name

may be removed from the applicable mailing list.

(End of provision)

12. Section 52.215-36 is amended by revising the provision date and

paragraph (a)(2) to read as follows:

52.215-36 Late Submissions, Modifications, and Withdrawals of

Proposals (Overseas).

* * * * *

Late Submissions, Modifications, and Withdrawals of Proposals

(OVERSEAS) (MAY 1997)

(a) * * *

(2) It was transmitted through an electronic commerce method

authorized by the solicitation and was received at the initial point

of entry to the Government infrastructure not later than 5:00 p.m.

one working day prior to the date specified for receipt of

proposals. The term ``working day'' excludes weekends and U.S.

Federal holidays;

* * * * *

[FR Doc. 97-6311 Filed 3-14-97; 8:45 am]

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