[Federal Register: January 10, 2001 (Volume 66, Number 7)]
[Rules and Regulations]
[Page 2115-2117]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr10ja01-23]
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Part III
Department of Defense
General Services Administration
National Aeronautics and Space Administration
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48 CFR Ch. 1
Federal Acquisition Regulation (FAR); Final Rule
[[Page 2116]]
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DEPARTMENT OF DEFENSE
GENERAL SERVICES ADMINISTRATION
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
48 CFR Ch. 1
Federal Acquisition Circular 97-22; Introduction
AGENCIES: Department of Defense (DoD), General Services Administration
(GSA), and National Aeronautics and Space Administration (NASA).
ACTION: Summary presentation of final rules.
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SUMMARY: This document summarizes the Federal Acquisition Regulation
(FAR) rules agreed to by the Civilian Agency Acquisition Council and
the Defense Acquisition Regulations Council (Councils) in this Federal
Acquisition Circular (FAC) 97-22. The Councils drafted these FAR rules
using plain language in accordance with the White House memorandum,
Plain Language in Government Writing, dated June 1, 1998. The Councils
wrote all new and revised text using plain language. A companion
document, the Small Entity Compliance Guide (SECG), follows this FAC.
The FAC, including the SECG, is available via the Internet at http://
www.arnet.gov/far.
DATES: For effective dates and comment dates, see separate documents
which follow.
FOR FURTHER INFORMATION CONTACT: The FAR Secretariat, Room 4035, GS
Building, Washington, DC 20405, (202) 501-4755, for information
pertaining to status or publication schedules. For clarification of
content, contact the analyst whose name appears in the table below in
relation to each FAR case or subject area. Please cite FAC 97-22 and
specific FAR case numbers. Interested parties may also visit our
website at http://www.arnet.gov/far.
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Item Subject FAR case Analyst
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I............ Definitions.............. 1999-403 Olson.
II........... Applicability, Thresholds 2000-301 Nelson.
and Waiver of Cost
Accounting Standards
Coverage.
III.......... Advance Payments for Non- 1999-016 Olson.
Commercial Items.
IV........... Part 12 and Assignment of 1999-021 Moss.
Claims.
V............ Clause Flowdown-- 1996-023 Moss.
Commercial Items.
VI........... Technical Amendments.....
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SUPPLEMENTARY INFORMATION: Summaries for each FAR rule follow. For the
actual revisions and/or amendments to these FAR cases, refer to the
specific item number and subject set forth in the documents following
these item summaries.
Federal Acquisition Circular 97-22 amends the FAR as specified
below:
Item I--Definitions (FAR Case 1999-403)
This final rule clarifies the applicability of definitions used in
the FAR, eliminates redundant or conflicting definitions, and makes
definitions easier to find. The rule--
Relocates definitions of terms that are used in more than
one FAR part with the same meaning to 2.101;
Relocates other definitions of terms to the
``Definitions'' section of the highest level FAR division (part,
subpart, or section) where the term as defined is used. For example, if
a term was defined in a FAR section, but the term is used as defined in
another section of that subpart, then the definition was moved to the
``Definitions'' section of that subpart;
Clarifies that a term, defined in FAR 2.101, has the same
meaning throughout the FAR unless the context in which the term is used
clearly requires a different meaning; or unless another FAR part,
subpart, or section provides a different definition for that particular
part, subpart, or section;
Adds cross-references to definitions of terms in FAR 2.101
that are defined differently in another part, subpart, or section of
the FAR; and
Makes technical corrections throughout the FAR.
Item II--Applicability, Thresholds and Waiver of Cost Accounting
Standards Coverage (FAR Case 2000-301)
The interim rule published as Item VIII of FAC 97-18 (65 FR 36028,
June 6, 2000) is converted to a final rule without change. This rule
amends FAR Subpart 30.2, CAS Program Requirements, and the FAR clause
at 52.230-1, Cost Accounting Standards Notices and Certification, to
implement Section 802 of the National Defense Authorization Act for
Fiscal Year 2000 (Pub. L. 106-65) and the Cost Accounting Standards
(CAS) Board's final rule, Applicability, Thresholds and Waiver of Cost
Accounting Standards Coverage. The FAR rule revises policies affecting
which contractors and subcontractors must comply with CAS by--
Removing the requirement at FAR 52.230-1, Cost Accounting
Standards Notices and Certification, that a contractor or subcontractor
must have received at least one CAS-covered contract exceeding $1
million (``trigger contract'') to be subject to ``full CAS coverage.''
The CAS Board added a new ``trigger contract'' dollar amount of $7.5
million at paragraph (b)(7) of 48 CFR 9903.201-1, CAS applicability,
which is already referenced at FAR 30.201-1;
Revising FAR 30.201-4(b), Disclosure and consistency of
cost accounting practices, and FAR 52.230-1 to increase the dollar
threshold for full CAS coverage from $25 million to $50 million; and
Revising the CAS waiver procedures and conditions at FAR
30.201-5.
Item III--Advance Payments for Non-Commercial Items (FAR Case 99-
016)
This final rule amends the FAR to permit federally insured credit
unions, in addition to banks, to participate in the maintenance of
special accounts for advance payments. The rule will only affect
contracting officers that provide contract financing using advance
payments for non-commercial items.
Item IV--Part 12 and Assignment of Claims (FAR Case 1999-021)
This final rule amends the FAR to correct an inconsistency between
two clauses related to the assignment of claims. FAR 52.232-36, Payment
by Third Party, prohibits a contractor from assigning its rights to
receive payment under the contract if payment is made by a third party,
such as when a Governmentwide commercial purchase card is used. This
clause is cited in the contract clause at FAR 52.212-5 that addresses
terms and conditions required to implement statutes or Executive orders
for commercial items.
FAR 52.212-4, Contract Terms and Conditions--Commercial Items,
addresses assignment of claims but does not include the third party
prohibition.
[[Page 2117]]
This rule revises FAR 52.212-4(b) to add the prohibition.
Item V--Clause Flowdown--Commercial Items (FAR Case 1996-023)
This final rule amends the clause at FAR 52.244-6, Subcontracts for
Commercial Items, to revise the listing of clauses the contractor must
flow down to subcontractors. The rule revises the listing to add the
clause at FAR 52.219-8, Utilization of Small Business Concerns, when
specified circumstances have been met. In addition, the rule adds
language to inform contractors that they may flow down a minimal number
of additional clauses to subcontractors to satisfy their contractual
obligations.
Item VI--Technical Amendments
This document makes amendments to the Federal Acquisition
Regulation in order to update references and make editorial changes.
Dated: December 22, 2000.
Al Matera,
Acting Director, Federal Acquisition Policy Division.
Federal Acquisition Circular
Federal Acquisition Circular (FAC) 97-22 is issued under the
authority of the Secretary of Defense, the Administrator of General
Services, and the Administrator for the National Aeronautics and Space
Administration.
All Federal Acquisition Regulation (FAR) changes and other
directive material contained in FAC 97-22 are effective March 12, 2001,
except for Items II and VI, which are effective January 10, 2001.
Dated: December 8, 2000
Deidre A. Lee,
Director, Defense Procurement.
Dated: December 8, 2000.
David A. Drabkin,
Deputy Associate Administrator, Office of Acquisition Policy,
General Services Administration.
Dated: December 7, 2000.
Tom Luedtke,
Associate Administrator for Procurement, National Aeronautics and
Space Administration.
[FR Doc. 01-282 Filed 1-9-01; 8:45 am]
BILLING CODE 6820-EP-P
[Federal Register: January 10, 2001 (Volume 66, Number 7)]
[Rules and Regulations]
[Page 2117-2136]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr10ja01-24]
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DEPARTMENT OF DEFENSE
GENERAL SERVICES ADMINISTRATION
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
48 CFR Parts 1, 2, 3, 4, 5, 6, 7, 8, 9, 11, 13, 14, 15, 17, 19, 22,
23, 24, 26, 27, 28, 29, 31, 32, 33, 34, 35, 36, 37, 39, 42, 43, 44,
46, 47, 48, 49, 50, and 52
[FAC 97-22; FAR Case 1999-403; Item I]
RIN 9000-AJ08
Federal Acquisition Regulation; Definitions
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 (Councils) have agreed on a final rule
amending the Federal Acquisition Regulation (FAR) to clarify the
applicability of definitions, eliminate redundant or conflicting
definitions, and make definitions easier to find.
DATES: Effective Date: March 12, 2001.
FOR FURTHER INFORMATION CONTACT: The FAR Secretariat, Room 4035, GS
Building, Washington, DC, 20405, (202) 501-4755, for information
pertaining to status or publication schedules. For clarification of
content, contact Mr. Jeremy Olson, Procurement Analyst, at (202) 501-
3221. Please cite FAC 97-22, FAR case 1999-403.
SUPPLEMENTARY INFORMATION:
A. Background
This final rule clarifies the applicability of definitions,
eliminates redundant or conflicting definitions, and makes definitions
easier to find. The Councils do not intend to make any substantive
policy changes to the FAR by these amendments. Nevertheless, in view of
the extensive scope of these FAR improvements, comments are invited in
the event any substantial policy change appears to have been made
inadvertently. The rule--
Relocates definitions of terms that are used in more than
one FAR part with the same meaning to 2.101;
Relocates other definitions of terms to the
``Definitions'' section of the highest level FAR division (part,
subpart, or section) the term as defined is used in. For example, if a
term was defined in a FAR section, but the term is used as defined in
another section of that subpart, then the definition was moved to the
``Definitions'' section of that subpart;
Clarifies that a term, defined in FAR 2.101, has the same
meaning throughout the FAR unless the context in which the term is used
clearly requires a different meaning; or another FAR part, subpart, or
section provides a different definition for that particular part,
subpart, or section;
Adds cross-references to definitions of terms in FAR 2.101
that are defined differently in another part, subpart, or section of
the FAR;
Makes plain language revisions to the revised text in
accordance with the White House memorandum, Plain Language in
Government Writing, dated June 1, 1998; and
Makes technical corrections throughout the FAR.
This is not a significant regulatory action, and therefore, was not
subject to review under Section 6(b) of Executive Order 12866,
Regulatory Planning and Review, dated September 30, 1993. This rule is
not a major rule under 5 U.S.C. 804.
B. Regulatory Flexibility Act
The final rule does not constitute a significant FAR revision
within the meaning of FAR 1.501 and Public Law 98-577, and publication
for public comments is not required. However, the Councils will
consider comments from small entities concerning the affected FAR Parts
in accordance with 5 U.S.C. 610. Interested parties must submit such
comments separately and should cite 5 U.S.C. 601, et seq. (FAC 97-22,
FAR case 1999-403), in correspondence.
C. Paperwork Reduction Act
The Paperwork Reduction Act does not apply because the changes to
the FAR do not impose information collection requirements that 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 1, 2, 3, 4, 5, 6, 7, 8, 9, 11, 13,
14, 15, 17, 19, 22, 23, 24, 26, 27, 28, 29, 31, 32, 33, 34, 35, 36,
37, 39, 42, 43, 44, 46, 47, 48, 49, 50, and 52
Government procurement.
Dated: December 22, 2000.
Al Matera,
Acting Director, Federal Acquisition Policy Division.
Therefore, DoD, GSA, and NASA amend 48 CFR parts 1, 2, 3, 4, 5, 6,
7, 8, 9, 11, 13, 14, 15, 17, 19, 22, 23, 24, 26, 27, 28, 29, 31, 32,
33, 34, 35, 36, 37, 39, 42, 43, 44, 46, 47, 48, 49, 50, and 52 as set
forth below:
[[Page 2118]]
1. The authority citation for 48 CFR parts 1, 2, 3, 4, 5, 6, 7, 8,
9, 11, 13, 14, 15, 17, 19, 22, 23, 24, 26, 27, 28, 29, 31, 32, 33, 34,
35, 36, 37, 39, 42, 43, 44, 46, 47, 48, 49, 50, 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 1--FEDERAL ACQUISITION REGULATIONS SYSTEM
2. Amend section 1.401 in paragraph (a) by removing ``52.101(a)''
each time it is used (twice) and adding ``2.101'' in its place; and in
paragraphs (c) and (d) revise the text in the parenthetical to read as
follows:
1.401 Definition.
* * * * *
(c) * * * (see definition of ``modification'' in 52.101(a) and
definition of ``alternate'' in 2.101(a)).
(d) * * * (see definitions in 2.101 and 52.101(a))
* * *
* * * * *
PART 2--DEFINITIONS OF WORDS AND TERMS
3a. Revise 2.000 to read as follows:
2.000 Scope of part.
(a) This part--
(1) Defines words and terms that are frequently used in the FAR;
(2) Provides cross-references to other definitions in the FAR of
the same word or term; and
(3) Provides for the incorporation of these definitions in
solicitations and contracts by reference.
(b) Other parts, subparts, and sections of this regulation (48 CFR
chapter 1) may define other words or terms and those definitions only
apply to the part, subpart, or section where the word or term is
defined (see the Index for locations).
3b. Amend section 2.101 as follows:
--Revise paragraphs (a) and (b);
--Add, in alphabetical order, the following definitions:
``Acquisition planning,''
``Adequate evidence,''
``Alternate,''
``Architect-engineer services,''
``Assignment of claims,''
``Basic research,''
``Broad agency announcement,''
``Business unit,''
``Change-of-name agreement,''
``Change order,''
``Cognizant Federal agency,''
``Computer software,''
``Consent to subcontract,''
``Contract clause or clause,''
``Contract modification,''
``Conviction,''
``Cost or pricing data,''
``Cost realism,''
``Cost sharing,''
``Debarment,''
``Design-to-cost,''
``Drug-free workplace,''
``Effective date of termination,''
``Electronic data interchange (EDI),''
``Electronic Funds Transfer (EFT),''
``Federally Funded Research and Development Centers (FFRDCs),''
``Final indirect cost rate,''
``First article,''
``First article testing,''
``F.o.b.,''
``F.o.b. destination,''
``F.o.b. origin,
``F.o.b. . . .,''
``Forward pricing rate agreement,''
``Forward pricing rate recommendation,''
``Freight,''
``Full and open competition,''
``General and administrative (G&A) expense,''
``Historically black college or university,''
``HUBZone,''
``HUBZone small business concern,''
``Indirect cost,''
``Indirect cost rate,''
``Ineligible,''
``Information other than cost or pricing data,''
``Inherently governmental function,''
``Inspection,''
``Insurance,''
``Invoice,''
``Irrevocable letter of credit,''
``Labor surplus area,''
``Labor surplus area concern,''
``Latent defect,''
``List of Parties Excluded from Federal Procurement and Nonprocurement
Programs,''
``Make-or-Buy program,''
``Master solicitation,''
``Minority Institution,''
``Neutral person,''
``Novation agreement,''
``Option,''
``Organizational conflict of interest,''
``Overtime,''
``Overtime premium,''
``Ozone-depleting substance,''
``Performance-based contracting,''
``Personal services contract,''
``Power of attorney,''
``Preaward survey,''
``Preponderance of the evidence,''
``Pricing,''
``Procurement,''
``Procuring activity,''
``Projected average loss,''
``Proper invoice,''
``Purchase order,''
``Qualification requirement,''
``Qualified products list (QPL),''
``Residual value,''
``Responsible audit agency,''
``Responsible prospective contractor,''
``Segment,''
``Self-insurance,''
``Shipment,''
``Shop drawings,''
``Should,''
``Single, Governmentwide point of entry,''
``Small business subcontractor,''
``Small disadvantaged business concern,''
``Sole source acquisition,''
``Solicitation provision or provision,''
``Special competency,''
``State and local taxes,''
``Substantial evidence,''
``Substantially as follows or substantially the same as,''
``Supplemental agreement,''
``Surety,''
``Suspension,''
``Taxpayer Identification Number (TIN),''
``Unallowable cost,''
``Unique and innovative concept,''
``Unsolicited proposal,''
``Value engineering,''
``Value engineering change proposal (VECP),''
``Warranty,''
``Women-owned small business concern,''
``Writing or written,''
--Amend the definitions listed below as follows:
------------------------------------------------------------------------
Remove paragraph
Definition/paragraph designation(s) or Add in its/their
word place
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``Contract administration ``(a)'' and ``(1)'' and
office,''. ``(b)''. ``(2)'',
respectively.
``Contracting officer,''........ ``(a)'' and ``(1)'' and
``(b)''. ``(2)'',
respectively.
``Federal Acquisition Computer ``is''............ ``means''.
Network (FACNET) Architecture''.
``Head of the contracting ``includes''...... ``means''.
activity''.
``Pollution prevention,''....... ``(a)(1)'' and ``(1)(i)'' and
``(2)''. ``(ii)'',
respectively.
``(b)'' and ``(2)'' and
``(c)''. ``(3)'',
respectively.
[[Page 2119]]
``Virgin material,''............ ``(a)'' and ``(1)'' and
``(b)''. ``(2)'',
respectively.
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--Revise the definitions ``Affiliates,'' ``Agency head or head of
the agency,'' ``Commercial item,'' ``Contracting office,'' ``Head of
the agency,'' ``In writing, writing, or written,'' ``Information
technology,'' ``Major system,'' and ``Nondevelopmental item''. For the
convenience of the user, the section is set out in its entirety to read
as follows:
2.101 Definitions.
(a) A word or a term, defined in this section, has the same meaning
throughout this regulation (48 CFR chapter 1), unless--
(1) The context in which the word or term is used clearly requires
a different meaning; or
(2) Another FAR part, subpart, or section provides a different
definition for the particular part or portion of the part.
(b) If a word or term that is defined in this section is defined
differently in another part, subpart, or section of this regulation (48
CFR chapter 1, the definition in--
(1) This section includes a cross-reference to the other
definitions; and
(2) That part, subpart, or section applies to the word or term when
used in that part, subpart, or section.
Acquisition means the acquiring by contract with appropriated funds
of supplies or services (including construction) by and for the use of
the Federal Government through purchase or lease, whether the supplies
or services are already in existence or must be created, developed,
demonstrated, and evaluated. Acquisition begins at the point when
agency needs are established and includes the description of
requirements to satisfy agency needs, solicitation and selection of
sources, award of contracts, contract financing, contract performance,
contract administration, and those technical and management functions
directly related to the process of fulfilling agency needs by contract.
Acquisition planning means the process by which the efforts of all
personnel responsible for an acquisition are coordinated and integrated
through a comprehensive plan for fulfilling the agency need in a timely
manner and at a reasonable cost. It includes developing the overall
strategy for managing the acquisition.
Adequate evidence means information sufficient to support the
reasonable belief that a particular act or omission has occurred.
Advisory and assistance services means those services provided
under contract by nongovernmental sources to support or improve:
organizational policy development; decision-making; management and
administration; program and/or project management and administration;
or R&D activities. It can also mean the furnishing of professional
advice or assistance rendered to improve the effectiveness of Federal
management processes or procedures (including those of an engineering
and technical nature). In rendering the foregoing services, outputs may
take the form of information, advice, opinions, alternatives, analyses,
evaluations, recommendations, training and the day-to-day aid of
support personnel needed for the successful performance of ongoing
Federal operations. All advisory and assistance services are classified
in one of the following definitional subdivisions:
(1) Management and professional support services, i.e., contractual
services that provide assistance, advice or training for the efficient
and effective management and operation of organizations, activities
(including management and support services for R&D activities), or
systems. These services are normally closely related to the basic
responsibilities and mission of the agency originating the requirement
for the acquisition of services by contract. Included are efforts that
support or contribute to improved organization of program management,
logistics management, project monitoring and reporting, data
collection, budgeting, accounting, performance auditing, and
administrative technical support for conferences and training programs.
(2) Studies, analyses and evaluations, i.e., contracted services
that provide organized, analytical assessments/evaluations in support
of policy development, decision-making, management, or administration.
Included are studies in support of R&D activities. Also included are
acquisitions of models, methodologies, and related software supporting
studies, analyses or evaluations.
(3) Engineering and technical services, i.e., contractual services
used to support the program office during the acquisition cycle by
providing such services as systems engineering and technical direction
(see 9.505-1(b)) to ensure the effective operation and maintenance of a
weapon system or major system as defined in OMB Circular No. A-109 or
to provide direct support of a weapon system that is essential to
research, development, production, operation or maintenance of the
system.
Affiliates means associated business concerns or individuals if,
directly or indirectly--
(1) Either one controls or can control the other; or
(2) A third party controls or can control both.
Agency head or head of the agency means the Secretary, Attorney
General, Administrator, Governor, Chairperson, or other chief official
of an executive agency, unless otherwise indicated, including any
deputy or assistant chief official of an executive agency.
Alternate means a substantive variation of a basic provision or
clause prescribed for use in a defined circumstance. It adds wording
to, deletes wording from, or substitutes specified wording for a
portion of the basic provision or clause. The alternate version of a
provision or clause is the basic provision or clause as changed by the
addition, deletion, or substitution (see 52.105(a)).
Architect-engineer services, as defined in 40 U.S.C. 541, means--
(1) Professional services of an architectural or engineering
nature, as defined by State law, if applicable, that are required to be
performed or approved by a person licensed, registered, or certified to
provide those services;
(2) Professional services of an architectural or engineering nature
performed by contract that are associated with research, planning,
development, design, construction, alteration, or repair of real
property; and
(3) Those other professional services of an architectural or
engineering nature, or incidental services, that members of the
architectural and engineering professions (and individuals in their
employ) may logically or justifiably perform, including studies,
investigations, surveying and mapping, tests, evaluations,
consultations, comprehensive planning, program management, conceptual
designs, plans and specifications, value engineering,
[[Page 2120]]
construction phase services, soils engineering, drawing reviews,
preparation of operating and maintenance manuals, and other related
services.
Assignment of claims means the transfer or making over by the
contractor to a bank, trust company, or other financing institution, as
security for a loan to the contractor, of its right to be paid by the
Government for contract performance.
Basic research means that research directed toward increasing
knowledge in science. The primary aim of basic research is a fuller
knowledge or understanding of the subject under study, rather than any
practical application of that knowledge.
Best value means the expected outcome of an acquisition that, in
the Government's estimation, provides the greatest overall benefit in
response to the requirement.
Broad agency announcement means a general announcement of an
agency's research interest including criteria for selecting proposals
and soliciting the participation of all offerors capable of satisfying
the Government's needs (see 6.102(d)(2)).
Bundled contract means a contract where the requirements have been
consolidated by bundling. (See the definition of bundling.)
Bundling means--
(1) Consolidating two or more requirements for supplies or
services, previously provided or performed under separate smaller
contracts, into a solicitation for a single contract that is likely to
be unsuitable for award to a small business concern due to--
(i) The diversity, size, or specialized nature of the elements of
the performance specified;
(ii) The aggregate dollar value of the anticipated award;
(iii) The geographical dispersion of the contract performance
sites; or
(iv) Any combination of the factors described in paragraphs (1)(i),
(ii), and (iii) of this definition.
(2) ``Separate smaller contract'' as used in this definition, means
a contract that has been performed by one or more small business
concerns or that was suitable for award to one or more small business
concerns.
(3) This definition does not apply to a contract that will be
awarded and performed entirely outside of the United States.
Business unit means any segment of an organization, or an entire
business organization that is not divided into segments.
Change-of-name agreement means a legal instrument executed by the
contractor and the Government that recognizes the legal change of name
of the contractor without disturbing the original contractual rights
and obligations of the parties.
Change order means a written order, signed by the contracting
officer, directing the contractor to make a change that the Changes
clause authorizes the contracting officer to order without the
contractor's consent.
Cognizant Federal agency means the Federal agency that, on behalf
of all Federal agencies, is responsible for establishing final indirect
cost rates and forward pricing rates, if applicable, and administering
cost accounting standards for all contracts in a business unit.
Commercial component means any component that is a commercial item.
Commercial item means--
(1) Any item, other than real property, that is of a type
customarily used for nongovernmental purposes and that--
(i) Has been sold, leased, or licensed to the general public; or
(ii) Has been offered for sale, lease, or license to the general
public;
(2) Any item that evolved from an item described in paragraph (1)
of this definition through advances in technology or performance and
that is not yet available in the commercial marketplace, but will be
available in the commercial marketplace in time to satisfy the delivery
requirements under a Government solicitation;
(3) Any item that would satisfy a criterion expressed in paragraphs
(1) or (2) of this definition, but for--
(i) Modifications of a type customarily available in the commercial
marketplace; or
(ii) Minor modifications of a type not customarily available in the
commercial marketplace made to meet Federal Government requirements.
Minor modifications means modifications that do not significantly alter
the nongovernmental function or essential physical characteristics of
an item or component, or change the purpose of a process. Factors to be
considered in determining whether a modification is minor include the
value and size of the modification and the comparative value and size
of the final product. Dollar values and percentages may be used as
guideposts, but are not conclusive evidence that a modification is
minor;
(4) Any combination of items meeting the requirements of paragraphs
(1), (2), (3), or (5) of this definition that are of a type customarily
combined and sold in combination to the general public;
(5) Installation services, maintenance services, repair services,
training services, and other services if such services are procured for
support of an item referred to in paragraphs (1), (2), (3), or (4) of
this definition, and if the source of such services--
(i) Offers such services to the general public and the Federal
Government contemporaneously and under similar terms and conditions;
and
(ii) Offers to use the same work force for providing the Federal
Government with such services as the source uses for providing such
services to the general public;
(6) Services of a type offered and sold competitively in
substantial quantities in the commercial marketplace based on
established catalog or market prices for specific tasks performed under
standard commercial terms and conditions. This does not include
services that are sold based on hourly rates without an established
catalog or market price for a specific service performed;
(7) Any item, combination of items, or service referred to in
paragraphs (1) through (6) of this definition, notwithstanding the fact
that the item, combination of items, or service is transferred between
or among separate divisions, subsidiaries, or affiliates of a
contractor; or
(8) A nondevelopmental item, if the procuring agency determines the
item was developed exclusively at private expense and sold in
substantial quantities, on a competitive basis, to multiple State and
local governments.
Component means any item supplied to the Government as part of an
end item or of another component, except that for use in 52.225-9 and
52.225-11, see the definitions in 52.225-9(a) and 52.225-11(a).
Computer software means computer programs, computer data bases, and
related documentation.
Consent to subcontract means the contracting officer's written
consent for the prime contractor to enter into a particular
subcontract.
Construction means construction, alteration, or repair (including
dredging, excavating, and painting) of buildings, structures, or other
real property. For purposes of this definition, the terms ``buildings,
structures, or other real property'' include, but are not limited to,
improvements of all types, such as bridges, dams, plants, highways,
parkways, streets, subways, tunnels, sewers, mains, power lines,
cemeteries, pumping stations, railways, airport facilities, terminals,
docks, piers, wharves, ways, lighthouses, buoys, jetties, breakwaters,
levees, canals, and channels. Construction does not include the
manufacture, production, furnishing, construction, alteration, repair,
processing, or assembling of
[[Page 2121]]
vessels, aircraft, or other kinds of personal property.
Contract means a mutually binding legal relationship obligating the
seller to furnish the supplies or services (including construction) and
the buyer to pay for them. It includes all types of commitments that
obligate the Government to an expenditure of appropriated funds and
that, except as otherwise authorized, are in writing. In addition to
bilateral instruments, contracts include (but are not limited to)
awards and notices of awards; job orders or task letters issued under
basic ordering agreements; letter contracts; orders, such as purchase
orders, under which the contract becomes effective by written
acceptance or performance; and bilateral contract modifications.
Contracts do not include grants and cooperative agreements covered by
31 U.S.C. 6301, et seq. For discussion of various types of contracts,
see part 16.
Contract administration office means an office that performs--
(1) Assigned postaward functions related to the administration of
contracts; and
(2) Assigned preaward functions.
Contract clause or clause means a term or condition used in
contracts or in both solicitations and contracts, and applying after
contract award or both before and after award.
Contract modification means any written change in the terms of a
contract (see 43.103).
Contracting means purchasing, renting, leasing, or otherwise
obtaining supplies or services from nonfederal sources. Contracting
includes description (but not determination) of supplies and services
required, selection and solicitation of sources, preparation and award
of contracts, and all phases of contract administration. It does not
include making grants or cooperative agreements.
Contracting activity means an element of an agency designated by
the agency head and delegated broad authority regarding acquisition
functions.
Contracting office means an office that awards or executes a
contract for supplies or services and performs postaward functions not
assigned to a contract administration office (except for use in part
48, see also 48.001).
Contracting officer means a person with the authority to enter
into, administer, and/or terminate contracts and make related
determinations and findings. The term includes certain authorized
representatives of the contracting officer acting within the limits of
their authority as delegated by the contracting officer.
``Administrative contracting officer (ACO)'' refers to a contracting
officer who is administering contracts. ``Termination contracting
officer (TCO)'' refers to a contracting officer who is settling
terminated contracts. A single contracting officer may be responsible
for duties in any or all of these areas. Reference in this regulation
(48 CFR chapter 1) to administrative contracting officer or termination
contracting officer does not--
(1) Require that a duty be performed at a particular office or
activity; or
(2) Restrict in any way a contracting officer in the performance of
any duty properly assigned.
Conviction means a judgment or conviction of a criminal offense by
any court of competent jurisdiction, whether entered upon a verdict or
a plea, and includes a conviction entered upon a plea of nolo
contendere. For use in subpart 23.5, see the definition at 23.503.
Cost or pricing data (10 U.S.C. 2306a(h)(1) and 41 U.S.C. 254b)
means all facts that, as of the date of price agreement or, if
applicable, an earlier date agreed upon between the parties that is as
close as practicable to the date of agreement on price, prudent buyers
and sellers would reasonably expect to affect price negotiations
significantly. Cost or pricing data are data requiring certification in
accordance with 15.406-2. Cost or pricing data are factual, not
judgmental; and are verifiable. While they do not indicate the accuracy
of the prospective contractor's judgment about estimated future costs
or projections, they do include the data forming the basis for that
judgment. Cost or pricing data are more than historical accounting
data; they are all the facts that can be reasonably expected to
contribute to the soundness of estimates of future costs and to the
validity of determinations of costs already incurred. They also include
such factors as--
(1) Vendor quotations;
(2) Nonrecurring costs;
(3) Information on changes in production methods and in production
or purchasing volume;
(4) Data supporting projections of business prospects and
objectives and related operations costs;
(5) Unit-cost trends such as those associated with labor
efficiency;
(6) Make-or-buy decisions;
(7) Estimated resources to attain business goals; and
(8) Information on management decisions that could have a
significant bearing on costs.
Cost realism means that the costs in an offeror's proposal--
(1) Are realistic for the work to be performed;
(2) Reflect a clear understanding of the requirements; and
(3) Are consistent with the various elements of the offeror's
technical proposal.
Cost sharing means an explicit arrangement under which the
contractor bears some of the burden of reasonable, allocable, and
allowable contract cost.
Day means, unless otherwise specified, a calendar day.
Debarment means action taken by a debarring official under 9.406 to
exclude a contractor from Government contracting and Government-
approved subcontracting for a reasonable, specified period; a
contractor that is excluded is ``debarred.''
Delivery order means an order for supplies placed against an
established contract or with Government sources.
Design-to-cost means a concept that establishes cost elements as
management goals to achieve the best balance between life-cycle cost,
acceptable performance, and schedule. Under this concept, cost is a
design constraint during the design and development phases and a
management discipline throughout the acquisition and operation of the
system or equipment.
Drug-free workplace means the site(s) for the performance of work
done by the contractor in connection with a specific contract where
employees of the contractor are prohibited from engaging in the
unlawful manufacture, distribution, dispensing, possession, or use of a
controlled substance.
Effective date of termination means the date on which the notice of
termination requires the contractor to stop performance under the
contract. If the contractor receives the termination notice after the
date fixed for termination, then the effective date of termination
means the date the contractor receives the notice.
Electronic commerce means electronic techniques for accomplishing
business transactions including electronic mail or messaging, World
Wide Web technology, electronic bulletin boards, purchase cards,
electronic funds transfer, and electronic data interchange.
Electronic data interchange (EDI) means a technique for
electronically transferring and storing formatted information between
computers utilizing established and published formats and codes, as
authorized by the applicable Federal Information Processing Standards.
Electronic Funds Transfer (EFT) means any transfer of funds, other
than a transaction originated by cash, check, or similar paper
instrument, that is
[[Page 2122]]
initiated through an electronic terminal, telephone, computer, or
magnetic tape, for the purpose of ordering, instructing, or authorizing
a financial institution to debit or credit an account. The term
includes Automated Clearing House transfers, Fedwire transfers, and
transfers made at automatic teller machines and point-of-sale
terminals. For purposes of compliance with 31 U.S.C. 3332 and
implementing regulations at 31 CFR part 208, the term ``electronic
funds transfer'' includes a Governmentwide commercial purchase card
transaction.
End product means supplies delivered under a line item of a
Government contract.
Energy-efficient product means a product in the upper 25 percent of
efficiency for all similar products or, if there are applicable Federal
appliance or equipment efficiency standards, a product that is at least
10 percent more efficient than the minimum Federal standard.
Environmentally preferable means products or services that have a
lesser or reduced effect on human health and the environment when
compared with competing products or services that serve the same
purpose. This comparison may consider raw materials acquisition,
production, manufacturing, packaging, distribution, reuse, operation,
maintenance, or disposal of the product or service.
Executive agency means an executive department, a military
department, or any independent establishment within the meaning of 5
U.S.C. 101, 102, and 104(1), respectively, and any wholly owned
Government corporation within the meaning of 31 U.S.C. 9101.
Facsimile means electronic equipment that communicates and
reproduces both printed and handwritten material. If used in
conjunction with a reference to a document; e.g., facsimile bid, the
terms refers to a document (in the example given, a bid) that has been
transmitted to and received by the Government via facsimile.
Federal Acquisition Computer Network (FACNET) Architecture is a
Governmentwide system that provides universal user access, employs
nationally and internationally recognized data formats, and allows the
electronic data interchange of acquisition information between the
private sector and the Federal Government. FACNET qualifies as the
single, Governmentwide point of entry pending designation by the
Administrator of the Office of Federal Procurement Policy (OFPP).
Federal agency means any executive agency or any independent
establishment in the legislative or judicial branch of the Government
(except the Senate, the House of Representatives, the Architect of the
Capitol, and any activities under the Architect's direction).
Federally Funded Research and Development Centers (FFRDC's) means
activities that are sponsored under a broad charter by a Government
agency (or agencies) for the purpose of performing, analyzing,
integrating, supporting, and/or managing basic or applied research and/
or development, and that receive 70 percent or more of their financial
support from the Government; and--
(1) A long-term relationship is contemplated;
(2) Most or all of the facilities are owned or funded by the
Government; and
(3) The FFRDC has access to Government and supplier data,
employees, and facilities beyond that common in a normal contractual
relationship.
Final indirect cost rate means the indirect cost rate established
and agreed upon by the Government and the contractor as not subject to
change. It is usually established after the close of the contractor's
fiscal year (unless the parties decide upon a different period) to
which it applies. For cost-reimbursement research and development
contracts with educational institutions, it may be predetermined; that
is, established for a future period on the basis of cost experience
with similar contracts, together with supporting data.
First article means a preproduction model, initial production
sample, test sample, first lot, pilot lot, or pilot models.
First article testing means testing and evaluating the first
article for conformance with specified contract requirements before or
in the initial stage of production.
F.o.b. means free on board. This term is used in conjunction with a
physical point to determine--
(1) The responsibility and basis for payment of freight charges;
and
(2) Unless otherwise agreed, the point where title for goods passes
to the buyer or consignee.
F.o.b. destination means free on board at destination; i.e., the
seller or consignor delivers the goods on seller's or consignor's
conveyance at destination. Unless the contract provides otherwise, the
seller or consignor is responsible for the cost of shipping and risk of
loss. For use in the clause at 52.247-34, see the definition at 52.247-
34(a).
F.o.b. origin means free on board at origin; i.e., the seller or
consignor places the goods on the conveyance. Unless the contract
provides otherwise, the buyer or consignee is responsible for the cost
of shipping and risk of loss. For use in the clause at 52.247-29, see
the definition at 52.247-29(a).
F.o.b. * * * (For other types of F.o.b., see 47.303).
Forward pricing rate agreement means a written agreement negotiated
between a contractor and the Government to make certain rates available
during a specified period for use in pricing contracts or
modifications. These rates represent reasonable projections of specific
costs that are not easily estimated for, identified with, or generated
by a specific contract, contract end item, or task. These projections
may include rates for such things as labor, indirect costs, material
obsolescence and usage, spare parts provisioning, and material
handling.
Forward pricing rate recommendation means a rate set unilaterally
by the administrative contracting officer for use by the Government in
negotiations or other contract actions when forward pricing rate
agreement negotiations have not been completed or when the contractor
will not agree to a forward pricing rate agreement.
Freight means supplies, goods, and transportable property.
Full and open competition, when used with respect to a contract
action, means that all responsible sources are permitted to compete.
General and administrative (G&A) expense means any management,
financial, and other expense which is incurred by or allocated to a
business unit and which is for the general management and
administration of the business unit as a whole. G&A expense does not
include those management expenses whose beneficial or causal
relationship to cost objectives can be more directly measured by a base
other than a cost input base representing the total activity of a
business unit during a cost accounting period.
Head of the agency (see ``agency head'').
Head of the contracting activity includes the official who has
overall responsibility for managing the contracting activity.
Historically black college or university means an institution
determined by the Secretary of Education to meet the requirements of 34
CFR 608.2. For the Department of Defense, the National Aeronautics and
Space Administration,
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and the Coast Guard, the term also includes any nonprofit research
institution that was an integral part of such a college or university
before November 14, 1986.
HUBZone means a historically underutilized business zone that is an
area located within one or more qualified census tracts, qualified
nonmetropolitan counties, or lands within the external boundaries of an
Indian reservation.
HUBZone small business concern means a small business concern that
appears on the List of Qualified HUBZone Small Business Concerns
maintained by the Small Business Administration.
In writing, writing, or written means any worded or numbered
expression that can be read, reproduced, and later communicated, and
includes electronically transmitted and stored information.
Indirect cost means any cost not directly identified with a single,
final cost objective, but identified with two or more final cost
objectives or an intermediate cost objective.
Indirect cost rate means the percentage or dollar factor that
expresses the ratio of indirect expense incurred in a given period to
direct labor cost, manufacturing cost, or another appropriate base for
the same period (see also ``final indirect cost rate'').
Ineligible means excluded from Government contracting (and
subcontracting, if appropriate) pursuant to statutory, Executive order,
or regulatory authority other than this regulation (48 CFR chapter 1)
and its implementing and supplementing regulations; for example,
pursuant to the Davis-Bacon Act and its related statutes and
implementing regulations, the Service Contract Act, the Equal
Employment Opportunity Acts and Executive orders, the Walsh-Healey
Public Contracts Act, the Buy American Act, or the Environmental
Protection Acts and Executive orders.
Information other than cost or pricing data means any type of
information that is not required to be certified in accordance with
15.406-2 and is necessary to determine price reasonableness or cost
realism. For example, such information may include pricing, sales, or
cost information, and includes cost or pricing data for which
certification is determined inapplicable after submission.
Information technology means any equipment, or interconnected
system(s) or subsystem(s) of equipment, that is used in the automatic
acquisition, storage, manipulation, management, movement, control,
display, switching, interchange, transmission, or reception of data or
information by the agency.
(1) For purposes of this definition, equipment is used by an agency
if the equipment is used by the agency directly or is used by a
contractor under a contract with the agency that requires--
(i) Its use; or
(ii) To a significant extent, its use in the performance of a
service or the furnishing of a product.
(2) The term ``information technology'' includes computers,
ancillary equipment, software, firmware and similar procedures,
services (including support services), and related resources.
(3) The term ``information technology'' does not include any
equipment that--
(i) Is acquired by a contractor incidental to a contract; or
(ii) Contains imbedded information technology that is used as an
integral part of the product, but the principal function of which is
not the acquisition, storage, manipulation, management, movement,
control, display, switching, interchange, transmission, or reception of
data or information. For example, HVAC (heating, ventilation, and air
conditioning) equipment, such as thermostats or temperature control
devices, and medical equipment where information technology is integral
to its operation, are not information technology.
Inherently governmental function means, as a matter of policy, a
function that is so intimately related to the public interest as to
mandate performance by Government employees. This definition is a
policy determination, not a legal determination. An inherently
governmental function includes activities that require either the
exercise of discretion in applying Government authority, or the making
of value judgments in making decisions for the Government. Governmental
functions normally fall into two categories: the act of governing,
i.e., the discretionary exercise of Government authority, and monetary
transactions and entitlements.
(1) An inherently governmental function involves, among other
things, the interpretation and execution of the laws of the United
States so as to--
(i) Bind the United States to take or not to take some action by
contract, policy, regulation, authorization, order, or otherwise;
(ii) Determine, protect, and advance United States economic,
political, territorial, property, or other interests by military or
diplomatic action, civil or criminal judicial proceedings, contract
management, or otherwise;
(iii) Significantly affect the life, liberty, or property of
private persons;
(iv) Commission, appoint, direct, or control officers or employees
of the United States; or
(v) Exert ultimate control over the acquisition, use, or
disposition of the property, real or personal, tangible or intangible,
of the United States, including the collection, control, or
disbursement of Federal funds.
(2) Inherently governmental functions do not normally include
gathering information for or providing advice, opinions,
recommendations, or ideas to Government officials. They also do not
include functions that are primarily ministerial and internal in
nature, such as building security, mail operations, operation of
cafeterias, housekeeping, facilities operations and maintenance,
warehouse operations, motor vehicle fleet management operations, or
other routine electrical or mechanical services. The list of commercial
activities included in the attachment to Office of Management and
Budget (OMB) Circular No. A-76 is an authoritative, nonexclusive list
of functions that are not inherently governmental functions.
Inspection means examining and testing supplies or services
(including, when appropriate, raw materials, components, and
intermediate assemblies) to determine whether they conform to contract
requirements.
Insurance means a contract that provides that for a stipulated
consideration, one party undertakes to indemnify another against loss,
damage, or liability arising from an unknown or contingent event.
Invoice means a contractor's bill or written request for payment
under the contract for supplies delivered or services performed (see
also ``proper invoice'').
Irrevocable letter of credit means a written commitment by a
federally insured financial institution to pay all or part of a stated
amount of money, until the expiration date of the letter, upon the
Government's (the beneficiary) presentation of a written demand for
payment. Neither the financial institution nor the offeror/contractor
can revoke or condition the letter of credit.
Labor surplus area means a geographical area identified by the
Department of Labor in accordance with 20 CFR part 654, subpart A, as
an area of concentrated unemployment or underemployment or an area of
labor surplus.
Labor surplus area concern means a concern that together with its
first-tier
[[Page 2124]]
subcontractors will perform substantially in labor surplus areas.
Performance is substantially in labor surplus areas if the costs
incurred under the contract on account of manufacturing, production, or
performance of appropriate services in labor surplus areas exceed 50
percent of the contract price.
Latent defect means a defect that exists at the time of acceptance
but cannot be discovered by a reasonable inspection.
List of Parties Excluded from Federal Procurement and
Nonprocurement Programs means a list compiled, maintained, and
distributed by the General Services Administration containing the names
and other information about parties debarred, suspended, or voluntarily
excluded under the Nonprocurement Common Rule or the Federal
Acquisition Regulation, parties who have been proposed for debarment
under the Federal Acquisition Regulation, and parties determined to be
ineligible.
Major system means that combination of elements that will function
together to produce the capabilities required to fulfill a mission
need. The elements may include hardware, equipment, software, or any
combination thereof, but exclude construction or other improvements to
real property. A system is a major system if--
(1) The Department of Defense is responsible for the system and the
total expenditures for research, development, test, and evaluation for
the system are estimated to be more than $115,000,000 (based on fiscal
year 1990 constant dollars) or the eventual total expenditure for the
acquisition exceeds $540,000,000 (based on fiscal year 1990 constant
dollars);
(2) A civilian agency is responsible for the system and total
expenditures for the system are estimated to exceed $750,000 (based on
fiscal year 1980 constant dollars) or the dollar threshold for a
``major system'' established by the agency pursuant to Office of
Management and Budget Circular A-109, entitled ``Major System
Acquisitions,'' whichever is greater; or
(3) The system is designated a ``major system'' by the head of the
agency responsible for the system (10 U.S.C. 2302 and 41 U.S.C. 403).
Make-or-buy program means that part of a contractor's written plan
for a contract identifying those major items to be produced or work
efforts to be performed in the prime contractor's facilities and those
to be subcontracted.
Market research means collecting and analyzing information about
capabilities within the market to satisfy agency needs.
Master solicitation means a document containing special clauses and
provisions that have been identified as essential for the acquisition
of a specific type of supply or service that is acquired repetitively.
May denotes the permissive. However, the words ``no person may * *
*'' mean that no person is required, authorized, or permitted to do the
act described.
Micro-purchase means an acquisition of supplies or services (except
construction), the aggregate amount of which does not exceed $2,500,
except that in the case of construction, the limit is $2,000.
Micro-purchase threshold means $2,500.
Minority Institution means an institution of higher education
meeting the requirements of section 1046(3) of the Higher Education Act
of 1965 (20 U.S.C. 1067k), including a Hispanic-serving institution of
higher education, as defined in section 316(b)(1) of the Act (20 U.S.C.
1101a).
Must (see ``shall'').
National defense means any activity related to programs for
military or atomic energy production or construction, military
assistance to any foreign nation, stockpiling, or space.
Neutral person means an impartial third party, who serves as a
mediator, fact finder, or arbitrator, or otherwise functions to assist
the parties to resolve the issues in controversy. A neutral person may
be a permanent or temporary officer or employee of the Federal
Government or any other individual who is acceptable to the parties. A
neutral person must have no official, financial, or personal conflict
of interest with respect to the issues in controversy, unless the
interest is fully disclosed in writing to all parties and all parties
agree that the neutral person may serve (5 U.S.C. 583).
Nondevelopmental item means--
(1) Any previously developed item of supply used exclusively for
governmental purposes by a Federal agency, a State or local government,
or a foreign government with which the United States has a mutual
defense cooperation agreement;
(2) Any item described in paragraph (1) of this definition that
requires only minor modification or modifications of a type customarily
available in the commercial marketplace in order to meet the
requirements of the procuring department or agency; or
(3) Any item of supply being produced that does not meet the
requirements of paragraphs (1) or (2) solely because the item is not
yet in use.
Novation agreement means a legal instrument--
(1) Executed by the--
(i) Contractor (transferor);
(ii) Successor in interest (transferee); and
(iii) Government; and
(2) By which, among other things, the transferor guarantees
performance of the contract, the transferee assumes all obligations
under the contract, and the Government recognizes the transfer of the
contract and related assets.
Offer means a response to a solicitation that, if accepted, would
bind the offeror to perform the resultant contract. Responses to
invitations for bids (sealed bidding) are offers called ``bids'' or
``sealed bids'' responses to requests for proposals (negotiation) are
offers called ``proposals'' responses to requests for quotations
(negotiation) are not offers and are called ``quotes.'' For unsolicited
proposals, see subpart 15.6.
Option means a unilateral right in a contract by which, for a
specified time, the Government may elect to purchase additional
supplies or services called for by the contract, or may elect to extend
the term of the contract.
Organizational conflict of interest means that because of other
activities or relationships with other persons, a person is unable or
potentially unable to render impartial assistance or advice to the
Government, or the person's objectivity in performing the contract work
is or might be otherwise impaired, or a person has an unfair
competitive advantage.
Overtime means time worked by a contractor's employee in excess of
the employee's normal workweek.
Overtime premium means the difference between the contractor's
regular rate of pay to an employee for the shift involved and the
higher rate paid for overtime. It does not include shift premium, i.e.,
the difference between the contractor's regular rate of pay to an
employee and the higher rate paid for extra-pay-shift work.
Ozone-depleting substance means any substance the Environmental
Protection Agency designates in 40 CFR part 82 as--
(1) Class I, including, but not limited to, chlorofluorocarbons,
halons, carbon tetrachloride, and methyl chloroform; or
(2) Class II, including, but not limited to,
hydrochlorofluorocarbons.
Performance-based contracting means structuring all aspects of an
acquisition around the purpose of the work to be performed as opposed
to either the manner by which the work will be
[[Page 2125]]
performed or broad and imprecise statements of work.
Personal services contract means a contract that, by its express
terms or as administered, makes the contractor personnel appear to be,
in effect, Government employees (see 37.104).
Pollution prevention means any practice that--
(1)(i) Reduces the amount of any hazardous substance, pollutant, or
contaminant entering any waste stream or otherwise released into the
environment (including fugitive emissions) prior to recycling,
treatment, or disposal; and
(ii) Reduces the hazards to public health and the environment
associated with the release of such substances, pollutants, and
contaminants;
(2) Reduces or eliminates the creation of pollutants through
increased efficiency in the use of raw materials, energy, water, or
other resources; or
(3) Protects natural resources by conservation.
Possessions include the Virgin Islands, Johnston Island, American
Samoa, Guam, Wake Island, Midway Island, and the Guano Islands, but
does not include Puerto Rico, leased bases, or trust territories.
Power of attorney means the authority given one person or
corporation to act for and obligate another, as specified in the
instrument creating the power; in corporate suretyship, an instrument
under seal that appoints an attorney-in-fact to act in behalf of a
surety company in signing bonds (see also ``attorney-in-fact'' at
28.001).
Preaward survey means an evaluation of a prospective contractor's
capability to perform a proposed contract.
Preponderance of the evidence means proof by information that,
compared with that opposing it, leads to the conclusion that the fact
at issue is more probably true than not.
Pricing means the process of establishing a reasonable amount or
amounts to be paid for supplies or services.
Procurement (see ``acquisition'').
Procuring activity means a component of an executive agency having
a significant acquisition function and designated as such by the head
of the agency. Unless agency regulations specify otherwise, the term
``procuring activity'' is synonymous with ``contracting activity.''
Projected average loss means the estimated long-term average loss
per period for periods of comparable exposure to risk of loss.
Proper invoice means a bill or written request for payment that
meets the minimum standards specified in the clause at 52.232-25,
Prompt Payment, 52.232-26, Prompt Payment for Fixed-Price Architect-
Engineer Contracts, or 52.232-27, Prompt Payment for Construction
Contracts (also see 32.905(e)), and other terms and conditions
contained in the contract for invoice submission.
Purchase order, when issued by the Government, means an offer by
the Government to buy supplies or services, including construction and
research and development, upon specified terms and conditions, using
simplified acquisition procedures.
Qualification requirement means a Government requirement for
testing or other quality assurance demonstration that must be completed
before award of a contract.
Qualified products list (QPL) means a list of products that have
been examined, tested, and have satisfied all applicable qualification
requirements.
Recovered material means waste materials and by-products recovered
or diverted from solid waste, but the term does not include those
materials and by-products generated from, and commonly reused within,
an original manufacturing process. For use in subpart 11.3 for paper
and paper products, see the definition at 11.301.
Residual value means the proceeds, less removal and disposal costs,
if any, realized upon disposition of a tangible capital asset. It
usually is measured by the net proceeds from the sale or other
disposition of the asset, or its fair value if the asset is traded in
on another asset. The estimated residual value is a current forecast of
the residual value.
Responsible audit agency means the agency that is responsible for
performing all required contract audit services at a business unit.
Responsible prospective contractor means a contractor that meets
the standards in 9.104.
Segment means one of two or more divisions, product departments,
plants, or other subdivisions of an organization reporting directly to
a home office, usually identified with responsibility for profit and/or
producing a product or service. The term includes--
(1) Government-owned contractor-operated (GOCO) facilities; and
(2) Joint ventures and subsidiaries (domestic and foreign) in which
the organization has--
(i) A majority ownership; or
(ii) Less than a majority ownership, but over which it exercises
control.
Self-insurance means the assumption or retention of the risk of
loss by the contractor, whether voluntarily or involuntarily. Self-
insurance includes the deductible portion of purchased insurance.
Senior procurement executive means the individual appointed
pursuant to section 16(3) of the Office of Federal Procurement Policy
Act (41 U.S.C. 414(3)) who is responsible for management direction of
the acquisition system of the executive agency, including
implementation of the unique acquisition policies, regulations, and
standards of the executive agency.
Service-disabled veteran-owned small business concern--
(1) Means a small business concern--
(i) Not less than 51 percent of which is owned by one or more
service-disabled veterans or, in the case of any publicly owned
business, not less than 51 percent of the stock of which is owned by
one or more service-disabled veterans; and
(ii) The management and daily business operations of which are
controlled by one or more service-disabled veterans or, in the case of
a veteran with permanent and severe disability, the spouse or permanent
caregiver of such veteran.
(2) Service-disabled veteran means a veteran, as defined in 38
U.S.C. 101(2), with a disability that is service-connected, as defined
in 38 U.S.C. 101(16).
Shall denotes the imperative.
Shipment means freight transported or to be transported.
Shop drawings means drawings submitted by the construction
contractor or a subcontractor at any tier or required under a
construction contract, showing in detail either or both of the
following:
(1) The proposed fabrication and assembly of structural elements.
(2) The installation (i.e., form, fit, and attachment details) of
materials or equipment.
Should means an expected course of action or policy that is to be
followed unless inappropriate for a particular circumstance.
Signature or signed means the discrete, verifiable symbol of an
individual which, when affixed to a writing with the knowledge and
consent of the individual, indicates a present intention to
authenticate the writing. This includes electronic symbols.
Simplified acquisition procedures means the methods prescribed in
part 13 for making purchases of supplies or services.
Simplified acquisition threshold means $100,000, except that in the
case of any contract to be awarded and performed, or purchase to be
made, outside the United States in support of a contingency operation
(as defined in
[[Page 2126]]
10 U.S.C. 101(a)(13)) or a humanitarian or peacekeeping operation (as
defined in 10 U.S.C. 2302(8) and 41 U.S.C. 259(d)), the term means
$200,000.
Single, Governmentwide point of entry, means the one point of entry
to be designated by the Administrator of OFPP that will allow the
private sector to electronically access procurement opportunities
Governmentwide.
Small business subcontractor means a concern, including affiliates,
that for subcontracts valued at--
(1) $10,000 or less, does not have more than 500 employees; and
(2) More than $10,000, does not have employees or average annual
receipts exceeding the size standard in 13 CFR part 121 (see 19.102)
for the product or service it is providing on the subcontract.
Small disadvantaged business concern (except for 52.212-3(c)(2) and
52.219-1(b)(2) for general statistical purposes and 52.212-3(c)(7)(ii),
52.219-22(b)(2), and 52.219-23(a) for joint ventures under the price
evaluation adjustment for small disadvantaged business concerns), means
an offeror that represents, as part of its offer, that it is a small
business under the size standard applicable to the acquisition; and
either--
(1) It has received certification as a small disadvantaged business
concern consistent with 13 CFR part 124, subpart B; and
(i) No material change in disadvantaged ownership and control has
occurred since its certification;
(ii) Where the concern is owned by one or more disadvantaged
individuals, the net worth of each individual upon whom the
certification is based does not exceed $750,000 after taking into
account the applicable exclusions set forth at 13 CFR 124.104(c)(2);
and
(iii) It is identified, on the date of its representation, as a
certified small disadvantaged business concern in the data base
maintained by the Small Business Administration (PRO-Net); or
(2) For a prime contractor, it has submitted a completed
application to the Small Business Administration or a private certifier
to be certified as a small disadvantaged business concern in accordance
with 13 CFR part 124, subpart B, and a decision on that application is
pending, and that no material change in disadvantaged ownership and
control has occurred since it submitted its application. In this case,
a contractor must receive certification as a small disadvantaged
business by the Small Business Administration prior to contract award.
Sole source acquisition means a contract for the purchase of
supplies or services that is entered into or proposed to be entered
into by an agency after soliciting and negotiating with only one
source.
Solicitation provision or provision means a term or condition used
only in solicitations and applying only before contract award.
Special competency means a special or unique capability, including
qualitative aspects, developed incidental to the primary functions of
the Federally Funded Research and Development Centers to meet some
special need.
State and local taxes means taxes levied by the States, the
District of Columbia, Puerto Rico, possessions of the United States, or
their political subdivisions.
Substantial evidence means information sufficient to support the
reasonable belief that a particular act or omission has occurred.
Substantially as follows or substantially the same as, when used in
the prescription and introductory text of a provision or clause, means
that authorization is granted to prepare and utilize a variation of
that provision or clause to accommodate requirements that are peculiar
to an individual acquisition; provided that the variation includes the
salient features of the FAR provision or clause, and is not
inconsistent with the intent, principle, and substance of the FAR
provision or clause or related coverage of the subject matter.
Supplemental agreement means a contract modification that is
accomplished by the mutual action of the parties.
Supplies means all property except land or interest in land. It
includes (but is not limited to) public works, buildings, and
facilities; ships, floating equipment, and vessels of every character,
type, and description, together with parts and accessories; aircraft
and aircraft parts, accessories, and equipment; machine tools; and the
alteration or installation of any of the foregoing.
Surety means an individual or corporation legally liable for the
debt, default, or failure of a principal to satisfy a contractual
obligation. The types of sureties referred to are as follows:
(1) An individual surety is one person, as distinguished from a
business entity, who is liable for the entire penal amount of the bond.
(2) A corporate surety is licensed under various insurance laws
and, under its charter, has legal power to act as surety for others.
(3) A cosurety is one of two or more sureties that are jointly
liable for the penal sum of the bond. A limit of liability for each
surety may be stated.
Suspension means action taken by a suspending official under 9.407
to disqualify a contractor temporarily from Government contracting and
Government-approved subcontracting; a contractor that is disqualified
is ``suspended.''
Task order means an order for services placed against an
established contract or with Government sources.
Taxpayer Identification Number (TIN) means the number required by
the IRS to be used by the offeror in reporting income tax and other
returns. The TIN may be either a Social Security Number or an Employer
Identification Number.
Unallowable cost means any cost that, under the provisions of any
pertinent law, regulation, or contract, cannot be included in prices,
cost-reimbursements, or settlements under a Government contract to
which it is allocable.
Unique and innovative concept, when used relative to an unsolicited
research proposal, means that--
(1) In the opinion and to the knowledge of the Government
evaluator, the meritorious proposal--
(i) Is the product of original thinking submitted confidentially by
one source;
(ii) Contains new, novel, or changed concepts, approaches, or
methods;
(iii) Was not submitted previously by another; and
(iv) Is not otherwise available within the Federal Government.
(2) In this context, the term does not mean that the source has the
sole capability of performing the research.
United States, when used in a geographic sense, means the 50 States
and the District of Columbia, except as follows:
(1) For use in subpart 22.8, see the definition at 22.801.
(2) For use in subpart 22.10, see the definition at 22.1001.
(3) For use in part 25, see the definition at 25.003.
(4) For use in subpart 47.4, see the definition at 47.401.
Unsolicited proposal means a written proposal for a new or
innovative idea that is submitted to an agency on the initiative of the
offeror for the purpose of obtaining a contract with the Government,
and that is not in response to a request for proposals, Broad Agency
Announcement, Small Business Innovation Research topic, Small Business
Technology Transfer Research topic, Program Research and Development
Announcement, or any other Government-initiated solicitation or
program.
[[Page 2127]]
Value engineering means an analysis of the functions of a program,
project, system, product, item of equipment, building, facility,
service, or supply of an executive agency, performed by qualified
agency or contractor personnel, directed at improving performance,
reliability, quality, safety, and life-cycle costs (section 36 of the
Office of Federal Procurement Policy Act, 41 U.S.C. 401, et seq.). For
use in the clause at 52.248-2, see the definition at 52.248-2(b).
Value engineering change proposal (VECP)-(1) means a proposal
that--
(i) Requires a change to the instant contract to implement; and
(ii) Results in reducing the overall projected cost to the agency
without impairing essential functions or characteristics, provided that
it does not involve a change--
(A) In deliverable end item quantities only;
(B) In research and development (R&D) items or R&D test quantities
that are due solely to results of previous testing under the instant
contract; or
(C) To the contract type only.
(2) For use in the clauses at--
(i) 52.248-2, see the definition at 52.248-2(b); and
(ii) 52.248-3, see the definition at 52.248-3(b).
Veteran-owned small business concern means a small business
concern--
(1) Not less than 51 percent of which is owned by one or more
veterans (as defined at 38 U.S.C. 101(2)) or, in the case of any
publicly owned business, not less than 51 percent of the stock of which
is owned by one or more veterans; and
(2) The management and daily business operations of which are
controlled by one or more veterans.
Virgin material means--
(1) Previously unused raw material, including previously unused
copper, aluminum, lead, zinc, iron, other metal or metal ore; or
(2) Any undeveloped resource that is, or with new technology will
become, a source of raw materials.
Warranty means a promise or affirmation given by a contractor to
the Government regarding the nature, usefulness, or condition of the
supplies or performance of services furnished under the contract.
Waste reduction means preventing or decreasing the amount of waste
being generated through waste prevention, recycling, or purchasing
recycled and environmentally preferable products.
Women-owned small business concern means a small business concern--
(1) That is at least 51 percent owned by one or more women; or, in
the case of any publicly owned business, at least 51 percent of the
stock of which is owned by one or more women; and
(2) Whose management and daily business operations are controlled
by one or more women.
Writing or written (see ``in writing'').
3c. Revise section 2.201 to read as follows:
2.201 Contract clause.
Insert the clause at 52.202-1, Definitions, in solicitations and
contracts that exceed the simplified acquisition threshold. If the
contract is for personal services, construction, architect-engineer
services, or dismantling, demolition, or removal of improvements, use
the clause with its Alternate I. The contracting officer may include
additional definitions, provided they are consistent with the clause
and the FAR.
PART 3--IMPROPER BUSINESS PRACTICES AND PERSONAL CONFLICTS OF
INTEREST
4. In section 3.302, add an introductory paragraph to read as
follows:
3.302 Definitions.
As used in this subpart--
* * * * *
5. Amend section 3.401 by adding an introductory paragraph; and by
removing ``, as used in this subpart,'' from the definitions ``Bona
fide agency'', ``Bona fide employee'', ``Contingent fee'', and
``Improper influence'' by. The added text reads as follows:
3.401 Definitions.
As used in this subpart--
* * * * *
6. In section 3.501-1, revise the introductory paragraph; and
redesignate paragraphs (a) and (b) as (1) and (2), respectively. The
revised text reads as follows:
3.501-1 Definition.
Buying-in, as used in this section, means submitting an offer below
anticipated costs, expecting to--
* * * * *
7. Amend section 3.502-1 by adding an introductory paragraph;
removing ``, as used in this section,'' from the definitions
``Kickback'', ``Person'', ``Prime contract'', ``Prime Contractor'',
``Prime Contractor employee'', and ``Subcontract''; removing ``, as
used in this section, `` from the definition ``Subcontractor''; and
redesignating paragraphs (a) and (b) as (1) and (2), respectively. The
added text reads as follows:
3.502-1 Definitions.
As used in this section--
* * * * *
8. Add an introductory paragraph to section 3.901 to read as
follows:
3.901 Definitions.
As used in this subpart--
* * * * *
PART 4--ADMINISTRATIVE MATTERS
4.501 [Reserved]
9. Remove and reserve section 4.501.
4.901 Definition.
10. In section 4.901, revise the section heading as set forth
above; and remove the definition ``Taxpayer Identification Number
(TIN).''
PART 5--PUBLICIZING CONTRACT ACTIONS
5.202 [Amended]
11. In section 5.202, amend paragraph (a)(8) by removing ``6.003''
and adding ``2.101'' in its place.
12. Amend section 5.501, by adding an introductory paragraph; by
removing ``, as used in this subpart,'' from the definitions
``Advertisement'' and ``Publication''; and by redesignating paragraphs
(a) and (b) in the definition ``Publication'' as (1) and (2),
respectively. The added text reads as follows:
5.501 Definitions.
As used in this subpart--
* * * * *
PART 6--COMPETITION REQUIREMENTS
13. Revise section 6.000 to read as follows:
6.000 Scope of part.
This part prescribes policies and procedures to promote full and
open competition in the acquisition process and to provide for full and
open competition, full and open competition after exclusion of sources,
other than full and open competition, and competition advocates. This
part does not deal with the results of competition (e.g., adequate
price competition), that are addressed in other parts (e.g., part 15).
6.003 [Removed and Reserved]
14. Remove and reserve section 6.003.
[[Page 2128]]
15. Amend section 6.302-1 by revising paragraph (a)(2)(i)(A) to
read as follows:
6.302-1 Only one responsible source and no other supplies or services
will satisfy agency requirements.
(a) * * *
(2) * * *
(i) * * *
(A) Demonstrates a unique and innovative concept (see definition at
2.101), or, demonstrates a unique capability of the source to provide
the particular research services proposed;
* * * * *
6.302-3 [Amended]
16. Amend section 6.302-3 in paragraph (a)(2)(iii) by removing
``(see 33.201)''.
PART 7--ACQUISITION PLANNING
17. Amend section 7.101 by adding an introductory paragraph;
removing the definitions ``Acquisition planning'' and ``Design to
cost''; and by removing ``, as used in this subpart,'' from the
definitions ``Acquisition streamlining'', and ``Planner''. The added
text reads as follows:
7.101 Definitions.
As used in this subpart--
* * * * *
7.501 [Reserved]
18. Remove and reserve section 7.501.
PART 8--REQUIRED SOURCES OF SUPPLIES AND SERVICES
19. In section 8.501, add an introductory paragraph; and remove ``,
as used in this subpart,'' from the definition ``Bureau of Land
Management''. The added text reads as follows:
8.501 Definitions.
As used in this subpart--
* * * * *
20. In section 8.701, add an introductory paragraph; and amend the
definitions ``Allocation'', ``Central nonprofit agency'',
``Committee'', and ``Procurement List'' by removing ``, as used in this
subpart,''. The added text reads as follows:
8.701 Definitions.
As used in this subpart--
* * * * *
21. Amend section 8.801 by adding an introductory paragraph; and ''
removing ``, as used in this subpart,'' from the definition ``Related
supplies''. The added text reads as follows:
8.801 Definitions.
As used in this subpart--
* * * * *
22. Amend section 8.1101 by adding an introductory paragraph;
removing from the definition ``Leasing'' ``, as used in this
subpart,''; and redesignating paragraphs (a) and (b) in the definition
``Motor vehicle'' as (1) and (2), respectively. The added text reads as
follows:
8.1101 Definitions.
As used in this subpart--
* * * * *
PART 9--CONTRACTOR QUALIFICATIONS
9.101 [Amended]
23. Amend section 9.101 by revising the section heading to read
``Definition''; by removing the definitions ``Preaward survey'' and
``Responsible prospective contractor''; and by adding ``, as used in
this subpart,'' after the word ``activity'' in the definition
``Surveying activity.''
24. Amend section 9.201 by adding an introductory paragraph; and by
removing the definitions ``Procuring activity'', ``Qualification
requirement'', and ``Qualified products list (QPL).'' The added text
reads as follows:
9.201 Definitions.
As used in this subpart--
* * * * *
9.301 Definition.
25. Amend section 9.301 by revising the section heading to read as
set forth above; and by removing the definitions ``First article'' and
``First article testing.''
9.400 [Amended]
26. Amend section 9.400 in paragraph (a)(2) by removing ``9.403''
and adding ``2.101'' in its place.
27. Amend section 9.403 as follows:
a. Add an introductory paragraph;
b. Remove the definitions ``Adequate evidence'', ``Conviction'',
``Debarment'', ``Ineligible'', ``List of Parties Excluded from Federal
Procurement and Nonprocurement
Programs'', ``Preponderance of the evidence'', and ``Suspension'';
c. In the definitions ``Affiliates'', ``Contractor'', ``Debarring
official'', and ``Suspending official'', redesignate paragraphs (a) and
(b) as (1) and (2), respectively;
d. Amend the definitions ``Agency'', ``Contractor'', and ``Unfair
trade practices'' by removing ``, as used in this subpart,'' and
e. In the definition ``Indictment'' remove ``shall be'' and add
``is'' in its place.
The added text reads as follows:
9.403 Definitions.
As used in this subpart--
* * * * *
9.501 Definition.
28. Amend section 9.501 as follows:
a. Revise the section heading as set forth above;
b. In the definition ``Marketing consultant'' remove ``means'' and
add
``, as used in this subpart, means'' in its place; and redesignate
paragraphs (a) through (d) as (1) through (4), respectively; and
c. Remove the definition ``Organizational conflict of interest''.
9.601 [Amended]
29. Amend section 9.601 in the definition ``Contractor team
arrangement'' by adding ``, as used in this subpart,'' after the word
``arrangement'' the first time it is used; and by redesignating
paragraphs (a) and (b) as (1) and (2), respectively.
9.701 [Amended]
30. Amend section 9.701 by redesignating paragraphs (a) and (b) as
(1) and (2), respectively, and paragraphs (c) introductory text,
(c)(1), and (c)(2) as (3), (3)(i), and (3)(ii), respectively.
PART 11--DESCRIBING AGENCY NEEDS
31. Amend section 11.601 by adding an introductory paragraph; and
by removing ``, as used in this subpart,'' from the definitions
``Authorized program'', ``Controlled materials'', and ``Delegate
Agency''. The added text reads as follows:
11.601 Definitions.
As used in this subpart--
* * * * *
PART 13--SIMPLIFIED ACQUISITION PROCEDURES
13.001 [Amended]
32. Amend section 13.001 by removing the definition ``Purchase
order''.
13.501 [Amended]
33. Amend section 13.501 in paragraph (a)(1)(i) by removing
``6.003'' and adding ``2.101'' in its place.
PART 14--SEALED BIDDING
34. Revise section 14.203-3 to read as follows:
[[Page 2129]]
14.203-3 Master solicitation.
The master solicitation is provided to potential sources who are
requested to retain it for continued and repetitive use. Individual
solicitations must reference the date of the current master
solicitation and identify any changes. The contracting officer must--
(a) Make available copies of the master solicitation on request;
and
(b) Provide the cognizant contract administration activity a
current copy of the master solicitation.
PART 15--CONTRACTING BY NEGOTIATION
35. Amend section 15.001 by adding, in alphabetical order, the
definitions ``Deficiency'' and ``Weakness'' to read as follows:
15.001 Definitions.
Deficiency is a material failure of a proposal to meet a Government
requirement or a combination of significant weaknesses in a proposal
that increases the risk of unsuccessful contract performance to an
unacceptable level.
* * * * *
Weakness means a flaw in the proposal that increases the risk of
unsuccessful contract performance. A ``significant weakness'' in the
proposal is a flaw that appreciably increases the risk of unsuccessful
contract performance.
15.301 [Reserved]
36. Remove and reserve section 15.301.
37. Amend section 15.401 as follows:
a. Add an introductory paragraph;
b. Remove the definitions ``Cost or pricing data'', ``Cost
realism'', ``Forward pricing rate agreement'', ``Forward pricing rate
recommendation'', and ``Information other than cost or pricing data'';
and
c. Remove ``, as used in this subpart,'' from the definitions
``Price'' and ``Subcontract''. The added text reads as follows:
15.401 Definitions.
As used in this subpart--
* * * * *
15.402 [Amended]
38. Amend section 15.402 as follows:
a. In the introductory paragraph remove ``shall'' and add ``must''
in its place;
b. In the introductory text of paragraph (a) remove ``shall'' each
time it is used (twice) and add ``must'' in its place;
c. In paragraph (a)(2)(ii) remove ``15.401'' and add ``2.101'' in
its place; and
d. In paragraph (a)(3), second sentence, remove ``shall'' and add
``must'' in its place.
15.403-1 [Amended]
39. Amend section 15.403-1 in the first sentence of paragraph
(c)(3) by removing ``(c)(1) or (2)'' and adding ``(3)(i) or (ii)'' in
its place.
15.403-4 [Amended]
40. Amend section 15.403-4 in paragraph (c) by removing ``shall''
each time it is used (twice) and adding ``must'' in its place; and by
removing ``15.401'' and adding ``2.101'' in its place.
15.406-2 [Amended]
41. Amend section 15.406-2 paragraph (a) by removing ``shall'' each
time it is used (twice) and adding ``must'' in its place; and by
removing from the first sentence of the Certificate of Current Cost or
Pricing Data ``15.401'' and adding ``2.101'' in its place.
42. Amend section 15.407-2 by revising paragraph (b) to read as
follows:
15.407-2 Make-or-buy programs.
* * * * *
(b) Definition. Make item, as used in this subsection, means an
item or work effort to be produced or performed by the prime contractor
or its affiliates, subsidiaries, or divisions.
* * * * *
15.408 [Amended]
43. In section 15.408, amend Table 15-2, which follows paragraph
(m)(4), by adding a comma after the word ``title'' in paragraph A. (11)
of the General Instructions; and by removing from paragraph C.
``15.401'' and adding ``2.101'' in its place.
15.601 [Amended]
44. Amend section 15.601 by removing the definition ``Unsolicited
proposal.''
15.604 [Amended]
45. Amend section 15.604 in the introductory text of paragraph (a),
second sentence, by removing ``shall'' and adding ``must'' in its
place; and in paragraph (a)(1) by removing ``15.601'' and adding
``2.101'' in its place.
PART 17--SPECIAL CONTRACTING METHODS
17.103 [Amended]
46. Amend section 17.103 in the definition ``Cancellation'' by
redesignating paragraphs (a) and (b) as (1) and (2), respectively.
17.201 [Reserved]
47. Remove and reserve section 17.201.
17.501 [Amended]
48. In section 17.501, add ``, as used in this subpart,'' after the
word ``acquisition''.
PART 19--SMALL BUSINESS PROGRAMS
49. Amend section 19.001 as follows:
a. Add an introductory paragraph;
b. In the definitions ``Concern'', ``Fair market price'', and
``Industry'' remove ``, as used in this part,''; and
c. Remove the definitions ``HUBZone'', ``HUBZone small business
concern'', ``Labor surplus area'', ``Labor surplus area concern'',
``Small disadvantaged business concern'', and ``Women-owned small
business concern''. The added text reads as follows:
19.001 Definitions.
As used in this part--
* * * * *
50. Amend section 19.101 as follows:
a. Add an introductory paragraph;
b. In the definition of ``Affiliates''--
Remove ``As used in this subpart, business'' and add
``Business'' in its place;
Redesignate paragraphs (a) through (g) as (1) through (7),
respectively;
In the newly designated paragraph (3), redesignate
paragraphs (1) through (3) as (i) through (iii), respectively;
In the newly designated paragraph (6), redesignate
paragraphs (1) through (3) as (i) through (iii), respectively;
In the newly designated paragraph (7), redesignate
paragraphs (1) through (5) as (i) through (v), respectively;
In the newly designated paragraph (7)(i) redesignate
paragraphs (i) and (ii) as (A) and (B), respectively;
In the newly designated paragraph (7)(i)(B), redesignate
paragraphs (A) and (B) as (1) and (2), respectively; and
In the newly designated paragraph (7)(v), remove
``(g)(1)(i) and (ii)'' and add ``(7)(i)(A) and (B)'' in its place; and
c. In the definition ``Annual receipts'', redesignate paragraphs
(1) and (2) as (i) and (ii), respectively; redesignate paragraphs (a)
and (b) as (1) and (2), respectively; and in the newly designated
paragraph (2) remove ``paragraph (a) above'' and add ``paragraph (1) of
this definition'' in its place. The added text reads as follows:
[[Page 2130]]
19.101 Explanation of terms.
As used in this subpart--
* * * * *
51. In section 19.701, add an introductory paragraph; and remove
the definition ``Small business subcontractor''. The added text reads
as follows:
19.701 Definitions.
As used in this subpart--
* * * * *
19.703 [Amended]
52. Amend section 19.703 in paragraph (a)(1) by removing ``in 2.101
or 19.001'' and adding ``(see 2.101 and 19.001)'' in its place.
53. Amend section 19.902 by revising the section heading and the
introductory paragraph to read as follows:
19.902 Designated SBA district.
A designated SBA district is the geographic area served by any of
the following SBA district offices:
* * * * *
PART 22--APPLICATION OF LABOR LAWS TO GOVERNMENT ACQUISITIONS
22.103-1 Definition.
54. Amend section 22.103-1 by revising the section heading to read
as set forth above; in the definition ``Normal workweek'' by
redesignating paragraphs (a) and (b) as (1) and (2), respectively; and
by removing the definitions ``Overtime'', ``Overtime premium'', and
``Shift premium''.
55. Amend section 22.401 as follows:
a. Add a new introductory paragraph;
b. Remove ``, as used in this subpart,'' from the definitions
``Building'' or ``work'', ``Construction, alteration, or repair'',
``Public building'' or ``public work'', and ``Wages''.
c. Amend the definition ``Laborers or mechanics'' as follows--
Remove ``, as used in this subpart,'';
Redesignate paragraphs (a) through (d) as (1) through (4),
respectively;
In the newly designated paragraph (2), redesignate
paragraphs (1) and (2) as (i) and (ii), respectively; and redesignate
paragraphs (i) and (ii) as (A) and (B), respectively; and
In the newly designated paragraph (4), remove ``paragraph
(c)'' and add ``paragraph (3)'' in its place; and
d. Amend the definition ``Site of the work'' as follows:
Remove ``, as used in this subpart,'';
Redesignate paragraphs (a) through (c) as (1) through (3),
respectively;
In the newly designated paragraph (1), remove ``paragraph
(b)'' and add ``paragraph (2)'' in its place; and
In the newly designated paragraph (2), remove ``paragraph
(c)'' and add ``paragraph (3)'' in its place. The added text reads as
follows:
22.401 Definitions.
As used in this subpart--
* * * * *
56. Amend section 22.1001 by adding an introductory paragraph;
revising the definition ``Act or Service Contract Act''; and removing
``, as used in this subpart,'' from the definitions ``Contractor'',
``Multiple year contracts'', ``Notice'', ``Service contract'', and
``United States''. The added and revised text reads as follows:
22.1001 Definitions.
As used in this subpart--
Act or Service Contract Act means the Service Contract Act of 1965.
* * * * *
22.1102 [Amended]
57. In the first sentence of section 22.1102, add ``, as used in
this subpart,'' after ``Professional employee''.
58. Amend section 22.1202, by adding an introductory paragraph; and
removing ``as used in this subpart,'' from the definitions ``Building
service contract'', ``Public building'' and ``Service employee''. The
added text reads as follows:
22.1202 Definitions.
As used in this subpart--
* * * * *
PART 23--ENVIRONMENT, CONSERVATION, OCCUPATIONAL SAFETY, AND DRUG-
FREE WORKPLACE
59. Amend section 23.503 by adding an introductory paragraph;
removing ``, as used in this subpart,'' from the definition
``Controlled substance''; and removing the definition ``Drug-free
workplace''. The added text reads as follows:
23.503 Definitions.
As used in this subpart--
* * * * *
23.802 [Reserved]
60. Remove and reserve section 23.802.
23.904 [Amended]
61. In section 23.904, add ``, as used in this subpart,'' after
``Toxic chemicals''.
PART 24--PROTECTION OF PRIVACY AND FREEDOM OF INFORMATION
62. Amend section 24.101 by adding an introductory paragraph; and
by removing ``, as used in this subpart,'' from the definitions
``Agency'', ``Individual'', ``Maintain'', ``Operation of a system of
records'', ``Record'', and ``System of records on individuals''. The
added text reads as follows:
24.101 Definitions.
As used in this subpart--
* * * * *
PART 26--OTHER SOCIOECONOMIC PROGRAMS
26.301 [Reserved]
63. Remove and reserve section 26.301.
PART 27--PATENTS, DATA, AND COPY RIGHTS
64. Amend section 27.301 by adding an introductory paragraph; and
by removing ``, as used in this subpart,'' from the definitions
``Invention'', ``Made'', ``Nonprofit organization'', ``Practical
application'', ``Small business firm'', and ``Subject invention''. The
added text reads as follows:
27.301 Definitions.
As used in this subpart--
* * * * *
65. Amend section 27.401 by adding an introductory paragraph;
removing the definition ``Computer software''; and removing ``, as used
in this subpart,'' from the definitions ``Data'', ``Form, fit, and
function data'', ``Limited rights'', ``Limited rights data'' (both
definitions), ``Restricted computer software'', ``Restricted rights'',
``Technical data'', and ``Unlimited rights''. The added text reads as
follows:
27.401 Definitions.
As used in this subpart--
* * * * *
PART 28--BONDS AND INSURANCE
66. Amend section 28.001 as follows:
a. Add an introductory paragraph;
b. Remove ``, as used in this part,'' from the definition
``Attorney-in-fact''; and in the parenthetical add ``at 2.101'' after
the word ``attorney'';
c. In the definition ``Bid guarantee'', redesignate paragraphs (a)
and (b) as (1) and (2), respectively;
d. In the definition ``Bond'', redesignate paragraphs (a) through
(f) as (1) through (6), respectively; and
e. Remove the definitions ``Insurance'', ``Irrevocable letter of
credit
[[Page 2131]]
(ILC)'', ``Power of attorney'', and ``Surety''. The added text reads as
follows:
28.001 Definitions.
As used in this part--
* * * * *
28.308 [Amended]
67. Amend section 28.308 in the first sentence of paragraph (a) by
removing ``(see 31.001)''.
PART 29--TAXES
29.301 [Reserved]
68. Remove and reserve section 29.301.
PART 31--CONTRACT COST PRINCIPLES AND PROCEDURES
69. Amend section 31.001 as follows:
a. Add an introductory paragraph;
b. Revise the definition ``Actual costs'';
c. In the definition ``Actuarial cost method'', remove ``that
uses'' and add ``which uses'', in its place;
d. Remove the definition ``Business unit'';
e. Revise the definitions ``Cost objective'' and ``Final cost
objective'';
f. Remove ``, as used in this part,'' from the definition ``Fiscal
year'';
g. Remove the definition ``General and administrative (G&A)
expense'';
h. Revise the definition ``Indirect cost pools'';
i. Remove ``, as used in this part'' from the definitions ``Job'';
Job class of employees''; and ``Labor market'';
j. Remove the definition ``Pricing'';
k. Revise the definition ``Profit center''; and
l. Remove the definitions ``Projected average loss'', ``Residual
value'', ``Segment'', ``Self-insurance'', and ``Unallowable cost''.
The added text reads as follows:
31.001 Definitions.
As used in this part--
* * * * *
Actual costs means (except for subpart 31.6) amounts determined on
the basis of costs incurred, as distinguished from forecasted costs.
Actual costs include standard costs properly adjusted for applicable
variances.
* * * * *
Cost objective means (except for subpart 31.6) a function,
organizational subdivision, contract, or other work unit for which cost
data are desired and for which provision is made to accumulate and
measure the cost of processes, products, jobs, capitalized projects,
etc.
* * * * *
Final cost objective means (except for subparts 31.3 and 31.6) a
cost objective that has allocated to it both direct and indirect costs
and, in the contractors accumulation system, is one of the final
accumulation points.
* * * * *
Indirect cost pools means (except for subparts 31.3 and 31.6)
groupings of incurred costs identified with two or more cost objectives
but not identified specifically with any final cost objective.
* * * * *
Profit center means (except for subparts 31.3 and 31.6) the
smallest organizationally independent segment of a company charged by
management with profit and loss responsibilities.
* * * * *
70. Amend section 31.205-17 as follows:
a. Add an introductory paragraph;
b. Remove the paragraph designation from paragraph ``(a)'';
c. Redesignate paragraphs (b) through (d) as (1) through (3),
respectively; and in newly designated paragraph (1), redesignate
paragraphs (1) and (2) as (i) and (ii), respectively; and
d. Remove ``, as used in this subsection,'' from the definitions
``Costs of idle facilities or idle capacity'', ``Facilities'', ``Idle
capacity'', and ``Idle facilities'';. The added text reads as follows:
31.205-17 Idle facilities and idle capacity costs.
As used in this subsection--
* * * * *
71. Amend section 31.205-18 in the heading of paragraph (a) by
adding ``As used in this subsection--'' after the word
``Definitions.''; removing ``, as used in this subsection,'' from the
definitions ``Applied research'', ``Bid and proposal (B&P) costs'',
``Company'', ``Development'', ``Independent research and development
(IR&D)'' and ``Systems and other concept formulation studies''; and
revising the definition ``Basic research'' to read as follows:
31.205-18 Independent research and development and bid and proposal
costs.
(a) * * *
Basic research (see 2.101).
* * * * *
31.205-32 [Amended]
72. Amend section 31.205-32 in the first sentence by removing ``are
those'' and adding ``means costs'' in its place; and in the second
sentence by removing ``Such'' and adding ``These'' in its place.
31.205-33 [Amended]
73. Amend section 31.205-33 in the first sentence of paragraph (a)
by removing ``subpart, are'' and adding ``subsection, means'' in its
place.
31.205-39 [Amended]
74. Amend the second sentence of section 31.205-39 by removing the
word ``such''.
31.205-47 [Amended]
75. Amend section 31.205-47 in the heading of paragraph (a) by
adding ``As used in this subpart--'' after ``Definitions.'', and by
removing the definition ``Conviction''; and in paragraph (f)(5) by
redesignating paragraphs (i) & (ii) as (A) and (B), and (1) and (2) as
(i) and (ii), respectively. The added text reads as follows:
31.205-47 Costs related to legal and other proceedings.
(a) Definitions. As used in this subpart--
* * * * *
PART 32--CONTRACT FINANCING
76. Amend section 32.001 by adding an introductory paragraph;
adding, in alphabetical order, the definitions ``Commercial interim
payment'', ``Delivery payment'', and ``Due date''; and removing ``, as
used in this part,'' from the definition ``Contract action''. The added
text reads as follows:
32.001 Definitions.
As used in this part--
Commercial interim payment means any payment that is not a
commercial advance payment or a delivery payment. These payments are
contract financing payments for prompt payment purposes (i.e., not
subject to the interest penalty provisions of the Prompt Payment Act in
accordance with subpart 32.9). A commercial interim payment is given to
the contractor after some work has been done, whereas a commercial
advance payment is given to the contractor when no work has been done.
* * * * *
Delivery payment means a payment for accepted supplies or services,
including payments for accepted partial deliveries. Commercial
financing payments are liquidated by deduction from these payments.
Delivery payments are invoice payments for prompt payment purposes.
Due date means the date on which payment should be made.
* * * * *
[[Page 2132]]
32.006-2 Definition.
77. Amend section 32.006-2 by revising the section heading
to read as set forth above; by removing the introductory paragraph;
by adding ``, as used in this section,'' after the word ``official'' in
the definition ``Remedy coordination official''; and by removing the
definition ``Substantial evidence''.
32.113 [Amended]
78. Amend section 32.113 in paragraph (e) by removing ``part 6''
and adding ``2.101'' in its place.
79. Amend section 32.202-2, by revising the first sentence in the
definition ``Commercial advance payment''; and by revising the
definitions ``Commercial interim payment'' and ``Delivery payment'' to
read as follows:
32.202-2 Types of payments for commercial item purchases.
* * * * *
Commercial advance payment, as used in this subsection, means a
payment made before any performance of work under the contract. * * *
Commercial interim payment (see 32.001).
Delivery payment (see 32.001).
32.202-3 [Amended]
80. Amend section 32.202-3 in paragraphs (d) and (e) by removing
``32.202-2'' and adding ``32.001'' in its place.
81. Amend section 32.301 by adding an introductory paragraph; and
by removing ``, as used in this subpart,'' from the definitions
``Borrower'', ``Guaranteed loan'' or ``V loan'', and ``Guaranteeing
agency''. The added text reads as follows:
32.301 Definitions.
As used in this subpart--
* * * * *
32.801 [Amended]
82. Amend section 32.801 by removing the definition ``Assignment of
claims''.
83. Amend section 32.902 by adding an introductory paragraph;
removing ``, as used in this subpart,'' from the definitions ``Contract
financing payment'', ``Day'', ``Designated billing office,'' and
``Invoice payment''; by removing the definitions ``Due date'',
``Invoice'', and ``Proper invoice''; and by removing ``which'' from the
definition ``Specified payment date'' the first time it appears and
adding ``that'' in its place. The added text reads as follows:
32.902 Definitions.
As used in this subpart--
* * * * *
84. Amend section 32.1102 as follows:
a. Add an introductory paragraph;
b. Remove the definition ``Electronic Funds Transfer'';
c. Remove from the definition ``EFT information'' ``EFT
information'' and add ``Electronic Funds Transfer information (EFT)''
in its place; and
d. Remove ``, as used in this part,'' from the definition
``Governmentwide commercial purchase card''. The added text reads as
follows:
32.1102 Definitions.
As used in this subpart--
* * * * *
PART 33--PROTESTS, DISPUTES, AND APPEALS
85. Amend section 33.101 as follows:
a. Add an introductory paragraph;
b. In the definition ``Day'' redesignate paragraphs (a) and (b) as
(1) and (2), respectively; and in the newly designated paragraph (2),
redesignate paragraphs (1) and (2) as (i) and (ii), respectively;
c. Remove ``, as used in this subpart,'' from the definitions
``Day'', ``Filed'', and ``Interested party for the purpose of filing a
protest''; and
d. Remove ``, as used in this subpart,'' from the definition
``Protest'' and redesignate paragraphs (a) through (d), as (1) through
(4), respectively. The added text reads as follows:
33.101 Definitions.
As used in this subpart--
* * * * *
86. Amend section 33.201 as follows:
a. Add an introductory paragraph;
b. Revise the first sentence of the definition ``Accrual of a
claim'';
c. Remove ``as used in this subpart,'' from the definitions
``Claim'' and ``Defective certification'';
d. Remove ``, as used in this part,'' from the definition
``Misrepresentation of fact'';
e. In the introductory paragraph of the definition ``Issue in
controversy'' remove ``which'' and add ``that'' in its place; and
f. Remove the definition ``Neutral person''.
The added and revised text reads as follows:
33.201 Definitions.
As used in this subpart--
Accrual of a claim means the date when all events, that fix the
alleged liability of either the Government or the contractor and permit
assertion of the claim, were known or should have been known. * * *
* * * * *
PART 34--MAJOR SYSTEM ACQUISITION
34.001 [Amended]
87. Amend section 34.001 in the definition ``Effective
competition'' by removing ``which'' and adding ``that'' (twice) in its
place.
34.101 [Amended]
88. Amend section 34.101 in the definition ``Item of supply'' by
removing ``for the purpose of'' and adding ``as used in'' in its place.
PART 35--RESEARCH AND DEVELOPMENT CONTRACTING
35.001 [Amended]
89. Amend section 35.001 by removing the definitions ``Basic
research'', ``Broad agency announcement'', ``Cost sharing'', and
``Federally Funded Research and Development Centers (FFRDC's)''.
90. Amend section 35.017 in paragraph (b) by adding an introductory
paragraph; by removing ``, as used in this section,'' from the
definitions ``Nonsponsor'' and ``Primary sponsor''; and by removing the
definition ``Special competency''. The added text reads as follows:
35.017 Federally Funded Research and Development Centers.
* * * * *
(b) Definitions. As used in this section--
* * * * *
PART 36--CONSTRUCTION AND ARCHITECT-ENGINEER CONTRACTS
91. Amend section 36.102 as follows:
a. Add an introductory paragraph;
b. Remove ``, as used in this part'' from the definitions
``Contract'', ``Design'', ``Design-bid-build'', ``Design-build'',
``Firm'', ``Plans and specifications'', ``Record drawings'', and ``Two-
phase design-build selection procedures''; and
c. Remove the definitions ``Architect-engineer services'', ``As-
built drawings'', and ``Shop drawings''.
36.102 Definitions.
As used in this part--
* * * * *
36.601-3 [Amended]
92. Amend section 36.601-3 in paragraph (d) by removing ``36.102''
and adding ``2.101'' in its place.
[[Page 2133]]
PART 37--SERVICE CONTRACTING
93. Amend section 37.101 by adding an introductory paragraph; by
removing the definitions ``Performance-based contracting'' and
``Personal services contract''; and in the definition ``Service
contract'' by redesignating paragraphs (a) through (i) as (1) through
(9), respectively. The added text reads as follows:
37.101 Definitions.
As used in this part--
* * * * *
37.103 [Amended]
94. Amend section 37.103 in paragraph (a)(1) by removing ``in
37.101'' and adding ``at 2.101 and 37.101'' in its place.
37.104 [Amended]
95. Amend section 37.104 in the first sentence of paragraph (a) by
removing ``As indicated in 37.101, a'' and adding ``A'' in its place.
37.201 [Amended]
96. Amend section 37.201 by removing ``, as used in this subpart,''
from the definition ``Covered personnel''; and by redesignating
paragraphs (a)(1) through (a)(6) as (a)(i) through (a)(vi), paragraphs
(a) through (c) as (1) through (3), respectively.
37.502 [Amended]
97. Amend section 37.502 in paragraph (a)(3) by removing ``36.102''
and adding ``2.101'' in its place.
PART 39--ACQUISITION OF INFORMATION TECHNOLOGY
98. Amend section 39.002 as follows:
a. Add an introductory paragraph;
b. Remove ``, as used in this part,'' from the definitions
``Modular contracting'' and ``National security system'';
c. In the definition ``National security system'', redesignate
paragraphs (a) through (e) as (1) through (5), respectively; and
d. In the definition ``Year 2000 compliant'', remove ``as used in
this part, means,'' and add ``means'' after the word ``technology,''.
The added text reads as follows:
39.002 Definitions.
As used in this part--
* * * * *
PART 42--CONTRACT ADMINISTRATION AND AUDIT SERVICES
42.001 [Reserved]
99. Remove and reserve section 42.001.
42.302 [Amended]
100. Amend section 42.302 in the last sentence of the introductory
text of paragraph (a) by removing ``(see 42.001)'' and adding ``(see
2.101)'' in its place.
42.503-2 [Amended]
101. Amend section 42.503-2 by removing ``(see 43.101)'' from the
fourth sentence.
42.701 Definition.
102. Amend section 42.701 as follows:
a. Revise the section heading as set forth above;
b. In the introductory paragraph of the definition ``Billing rate''
remove ``means'' and add ``as used in this subpart means'', and
redesignate paragraphs (a) and (b) as (1) and (2), respectively; and
c. Remove the definitions ``Business unit'', ``Final indirect cost
rate'', ``Forward pricing rate agreement'', ``Indirect cost'', and
``Indirect cost rate''.
42.1201 [Reserved]
103. Remove and reserve section 42.1201.
PART 43--CONTRACT MODIFICATIONS
104. Amend section 43.101 by adding an introductory paragraph; by
removing the definitions ``Change order'', ``Contract modification'',
and ``Supplemental agreement'', and the introductory text of the
definition ``Effective date'' including the heading Effective date.
The added text reads as follows:
43.101 Definitions.
As used in this part--
* * * * *
105. Amend section 43.103 by revising paragraph (b)(3) to read as
follows:
43.103 Types of contract modifications.
* * * * *
(b) * * *
(3) Make changes authorized by clauses other than a changes clause
(e.g., Property clause, Options clause, or Suspension of Work clause);
and
* * * * *
PART 44--SUBCONTRACTING POLICIES AND PROCEDURES
106. Amend section 44.101 by adding an introductory paragraph; by
removing the definition ``Consent to subcontract''; and by removing ``,
as used in this part,'' from the definitions ``Contractor'',
``Subcontract'', and ``Subcontractor''. The added text reads as
follows:
44.101 Definitions.
As used in this part--
* * * * *
PART 46--QUALITY ASSURANCE
107. Amend section 46.101 by adding an introductory paragraph; by
removing ``, as used in this part,'' from the definitions
``Acceptance'' and ``Conditional acceptance''; and by removing the
definitions ``Commercial item'', ``Inspection'', and ``Latent defect''.
The added text reads as follows:
46.101 Definitions.
As used in this part--
* * * * *
46.701 [Reserved]
108. Remove and reserve section 46.701.
109. Amend section 46.710 by adding a sentence to the end of
paragraphs (a)(1) and (b)(1) to read as follows:
46.710 Contract clauses.
* * * * *
(a)(1) * * * If the contractor's design rather than the
Government's design will be used, insert the word ``design'' before
``material'' in paragraph (b)(1)(i).
* * * * *
(b)(1) * * * If the contractor's design rather than the
Government's design will be used, insert the word ``design'' before
``material'' in paragraph (b)(1).
* * * * *
PART 47--TRANSPORTATION
110. Amend section 47.001 by adding an introductory paragraph; by
removing ``as used in this part'' from the definition ``Common
carrier'', and removing the definitions ``F.o.b.'', ``F.o.b. origin'',
``F.o.b. destination'', ``Freight'', and ``Shipment''. The added text
reads as follows:
47.001 Definitions.
As used in this part--
* * * * *
111. Amend section 47.201 by adding an introductory paragraph; and
removing ``, as used in this subpart'' from the definitions ``General
freight'', ``Household goods'', and ``Office
[[Page 2134]]
furniture''. The added text reads as follows:
47.201 Definitions.
As used in this subpart--
* * * * *
112. Amend section 47.401 by adding an introductory paragraph; and
by removing ``, as used in this subpart,'' from the definition ``United
States''. The added text reads as follows:
47.401 Definitions.
As used in this subpart--
* * * * *
113. Amend section 47.501 as follows:
a. Add an introductory paragraph;
b. Remove ``, as used in this subpart'' from the definitions
``Government vessel'', ``Privately owned U.S.-flag commercial vessel'',
and ``U.S.-flag vessel;
c. In the definition ``Privately owned U.S.-flag commercial
vessel'' redesignate paragraphs (a) through (d) as (1) through (4).
The added text reads as follows:
47.501 Definitions.
As used in this subpart--
* * * * *
PART 48--VALUE ENGINEERING
114. Amend section 48.001 as follows:
a. Add an introductory paragraph;
b. Remove ``, as used in this part,'' from the definitions
``Acquisition savings'', ``Collateral costs'', ``Collateral savings'',
``Contracting office'', ``Contractor's development and implementation
costs'', and ``Value engineering proposal'';
c. In the definition ``Acquisition savings'' redesignate paragraphs
(a) through (c) as (1) through (3), respectively;
d. Revise the newly designated paragraph (1);
e. In the newly designated paragraphs (2) and (3), remove ``which''
and add ``that'' in their places;
f. In the definition ``Future unit cost reduction'', ``Instant
contract'', ``Sharing base'', ``Sharing period'', and ``Unit'', remove
``, as used in this part,'';
g. In the definition ``Future unit cost reduction'', redesignate
paragraphs (a) and (b) as (1) and (2), respectively; and in the newly
designated paragraph (2) remove ``which'' and add ``that'' in its
place;
h. Revise the definition ``Government costs''; and
i. Remove the definitions ``Value engineering'' and ``Value
engineering change proposal (VECP)''.
The added and revised text reads as follows:
48.001 Definitions.
As used in this part--
* * * * *
Acquisition savings * * *
(1) Instant contract savings, that are the net cost reductions on
the contract under which the VECP is submitted and accepted, and that
are equal to the instant unit cost reduction multiplied by the number
of instant contract units affected by the VECP, less the contractor's
allowable development and implementation costs;
* * * * *
Government costs means those agency costs that result directly from
developing and implementing the VECP, such as any net increases in the
cost of testing, operations, maintenance, and logistics support. The
term does not include the normal administrative costs of processing the
VECP or any increase in instant contract cost or price resulting from
negative instant contract savings, except that for use in 52.248-3, see
the definition at 52.248-3(b).
* * * * *
PART 49--TERMINATION OF CONTRACTS
115. Amend section 49.001 as follows:
a. Add an introductory paragraph;
b. Remove ``, as used in this part,'' from the definitions
``Claim'', ``Continued portion of the contract'', ``Other work'', and
``Settlement proposal'';
c. Remove the definitions ``Effective date of termination'' and
``Termination contracting officer''; and
d. Revise the definition ``Settlement agreement''.
The added and revised text reads as follows:
49.001 Definitions.
As used in this part--
* * * * *
Settlement agreement means a written agreement in the form of a
contract modification settling all or a severable portion of a
settlement proposal.
* * * * *
PART 50--EXTRAORDINARY CONTRACTUAL ACTIONS
116. Amend section 50.001 by adding an introductory paragraph; and
removing ``, as used in this part,'' from the definitions ``Approving
authority'' and ``Secretarial level''. The added text reads as follows:
50.001 Definitions.
As used in this part--
* * * * *
PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES
52.101 [Amended]
117. Amend section 52.101 in the heading of paragraph (a) by
removing ``Definitions'' and adding ``Definition'' in its place; and by
removing the definitions ``Alternate'', ``Contract clause'' or
``clause'', ``Solicitation provision'' or ``provision'', and
``Substantially as follows'' or ``substantially the same as''.
118. Amend section 52.202-1 as follows:
a. Revise the introductory paragraph, the date of the clause, and
paragraphs (a) and (d) of the clause;
b. Remove paragraph (f) and redesignate paragraph (e) as (f), and
add a new paragraph (e);
c. In the newly designated paragraph (f)(2), remove ``(e)(1)'' and
add ``(f)(1)'' in its place; and in the newly designated (f)(3) remove
``(e)(1) or (e)(2)'' and add ``(f)(1) or (f)(2)'' in its place; and
d. In Alternate I of the clause, remove ``(Apr 1984)'' and add
``(Mar 2001)'' in its place; and remove ``paragraph (c)'' and add
``paragraph (g)'' in its place. The revised and new text reads as
follows:
52.202-1 Definitions.
As prescribed in section 2.201, insert the following clause:
DEFINITIONS (MAR 2001)
(a) Agency head or head of the agency means the Secretary
(Attorney General, Administrator, Governor, Chairperson, or other
chief official, as appropriate) of the agency, unless otherwise
indicated, including any deputy or assistant chief official of the
executive agency.
* * * * *
(d) Component means any item supplied to the Government as part
of an end item or of another component, except that for use in
52.225-9, and 52.225-11 see the definitions in 52.225-9(a) and
52.225-11(a).
(e) Contracting Officer means a person with the authority to
enter into, administer, and/or terminate contracts and make related
determinations and findings. The term includes certain authorized
representatives of the Contracting Officer acting within the limits
of their authority as delegated by the Contracting Officer.
* * * * *
(End of clause)
52.212-3 [Amended]
119. Amend section 52.212-3 in the heading of the clause by
removing ``(OCT 2000)'' and adding ``(MAR 2001)'' in its place; and in
paragraph (a) in the definition ``Women-owned small business concern''
by removing from paragraph (1) ``Which'' and ``women or''
[[Page 2135]]
and adding ``That'' and ``women; or'' in their places, respectively.
120. Amend section 52.214-21 by revising the date of the provision
and the first sentence in paragraph (a).
52.214-21 Descriptive Literature.
* * * * *
DESCRIPTIVE LITERATURE (MAR 2001)
(a) Descriptive Literature, as used in this provision, means
information (e.g., cuts, illustrations, drawings, and brochures)
that is submitted as part of a bid. * * *
* * * * *
121. Amend section 52.215-1 by revising the date of the provision;
and in paragraph (a) of the provision by revising the definition ``In
writing'' or ``written'' to read as follows:
52.215-1 Instructions to Offerors--Competitive Acquisition.
* * * * *
INSTRUCTIONS TO OFFERORS--COMPETITIVE ACQUISITION (MAR 2001)
(a) * * *
In writing, writing, or written means any worded or numbered
expression that can be read, reproduced, and later communicated, and
includes electronically transmitted and stored information.
* * * * *
52.219-1 [Amended]
122. Amend section 52.219-1 in the provision heading by removing
``(OCT 2000)'' and adding ``(MAR 2001)'' in its place; and in paragraph
(c) under the definition ``Women-owned small business concern'', by
removing from paragraph (1) ``Which'' and ``women or'' and adding
``That'' and ``women; or'' in their places, respectively.
123. Amend section 52.219-23 by revising the date of the clause;
and in paragraph (a) of the clause by revising the definition
``Minority institution'' to read as follows:
52.219-23 Notice of Price Evaluation Adjustment for Small
Disadvantaged Business Concerns.
* * * * *
NOTICE OF PRICE EVALUATION ADJUSTMENT FOR SMALL DISADVANTAGED BUSINESS
CONCERNS (MAR 2001)
(a) * * *
Minority institution means an institution of higher education
meeting the requirements of Section 1046(3) of the Higher Education
Act of 1965 (20 U.S.C. 1067k, including a Hispanic-serving
institution of higher education, as defined in Section 316(b)(1) of
the Act (20 U.S.C. 1101a)).
* * * * *
52.223-6 [Amended]
124.-125. Amend section 52.223-6 in the clause heading by removing
``(JAN 1997)'' and adding ``(MAR 2001)'' in its place; and in the
definition ``drug-free workplace'' by removing ``at which'' and adding
``where'' in its place.
126. Amend section 52.223-11 by revising the date of the clause and
paragraph (a) of the clause to read as follows:
52.223-11 Ozone-Depleting Substances.
* * * * *
OZONE-DEPLETING SUBSTANCES (MAR 2001)
(a) Definition. Ozone-depleting substance, as used in this
clause, means any substance the Environmental Protection Agency
designates in 40 CFR part 82 as--
(1) Class I, including, but not limited to, chlorofluorocarbons,
halons, carbon tetrachloride, and methyl chloroform; or
(2) Class II, including, but not limited to,
hydrochlorofluorocarbons.
* * * * *
127. Revise section 52.226-2 to read as follows:
52.226-2 Historically Black College or University and Minority
Institution Representation.
As prescribed in 26.304, insert the following provision:
HISTORICALLY BLACK COLLEGE OR UNIVERSITY AND MINORITY INSTITUTION
REPRESENTATION (MAR 2001)
(a) Definitions. As used in this provision--
Historically black college or university means an institution
determined by the Secretary of Education to meet the requirements of
34 CFR 608.2. For the Department of Defense, the National
Aeronautics and Space Administration, and the Coast Guard, the term
also includes any nonprofit research institution that was an
integral part of such a college or university before November 14,
1986.
Minority institution means an institution of higher education
meeting the requirements of Section 1046(3) of the Higher Education
Act of 1965 (20 U.S.C. 1067k, including a Hispanic-serving
institution of higher education, as defined in Section 316(b)(1) of
the Act (20 U.S.C. 1101a)).
(b) Representation. The offeror represents that it--
[ ] is [ ] is not a historically black college or university;
[ ] is [ ] is not a minority institution.
(End of provision)
52.232-25, 52.232-26, and 52.232-27 [Amended]
128. Amend sections 52.232-25, 52.232-26, and 52.232-27 in the
clause headings by removing ``(JUN 1997)'' and adding ``(MAR 2001)'' in
its place; and in the third sentence of the undesignated introductory
paragraph by removing ``section 32.902'' and adding ``sections 2.101
and 32.902'' in its place.
129. Amend section 52.242-3 in the clause heading by removing
``(OCT 1995)'' and adding ``(MAR 2001)'' in its place; and by revising
paragraph (c) to read as follows:
52.242-3 Penalties for Unallowable Costs.
* * * * *
(c) The Contractor shall not include in any proposal any cost that
is unallowable, as defined in Subpart 2.1 of the FAR, or an executive
agency supplement to the FAR.
* * * * *
130. Amend section 52.246-3 as follows:
a. In the clause heading, remove ``(APR 1984)'' and add ``(MAR
2001)'' in its place;
b. In the heading of paragraph (a), add ``As used in this clause--
'' after the word ``Definitions'';
c. In the definition ``Contractor's managerial personnel,'' remove
``, as used in this clause,'', and in paragraph (2) remove ``at which''
and add ``where'' in its place; and
d. In the definition ``Supplies,'' remove ``, as used in this
clause,''.
131. Amend section 52.246-6 as follows:
a. In the clause heading, remove ``(Jan 1986)'' and add ``(Mar
2001)'' in its place;
b. In the heading of paragraph (a), add ``As used in this clause--
'' after the word ``Definitions.'';
c. In the definition ``Contractor's managerial personnel,'' remove
``, as used in this clause,'', and in paragraph (2) remove ``at which''
and add ``where'' in its place; and
d. In the definition ``Materials,'' remove ``, as used in this
clause,''.
132. Amend section 52.246-8 as follows:
a. In the clause heading, remove ``(Apr 1984)'' and add ``(Mar
2001)'' in its place;
b. In the heading of paragraph (a), add ``As used in this clause--
'' after the word ``Definitions.'';
c. In the definition ``Contractor's managerial personnel,'' remove
``, as used in this clause,'', and in paragraph (2) remove ``at which''
and add ``where'' in its place; and
d. In the definition ``Work,'' remove ``, as used in this
clause,''.
133. Amend section 52.246-17 by revising the introductory
paragraph, the date of the clause, and paragraph (a) of the clause to
read as follows:
[[Page 2136]]
52.246-17 Warranty of Supplies of a Noncomplex Nature.
As prescribed in 46.710(a)(1), insert a clause substantially as
follows:
WARRANTY OF SUPPLIES OF A NONCOMPLEX NATURE (MAR 2001)
(a) Definitions. As used in this clause--
Acceptance means the act of an authorized representative of the
Government by which the Government assumes for itself, or as an
agent of another, ownership of existing supplies, or approves
specific services as partial or complete performance of the
contract.
Supplies means the end items furnished by the Contractor and
related services required under this contract. The word does not
include ``data.''
* * * * *
134. Amend section 52.246-18 by revising the introductory
paragraph, the date of the clause, and paragraph (a) of the clause to
read as follows:
52.246-18 Warranty of Supplies of a Complex Nature.
As prescribed in 46.710(b)(1), insert a clause substantially as
follows:
WARRANTY OF SUPPLIES OF A COMPLEX NATURE (MAR 2001)
(a) Definitions. As used in this clause--
Acceptance means the act of an authorized representative of the
Government by which the Government assumes for itself, or as an
agent of another, ownership of existing and identified supplies, or
approves specific services rendered, as partial or complete
performance of the contract.
Supplies means the end items furnished by the Contractor and
related services required under this contract. The word does not
include ``data.''
* * * * *
135. Amend section 52.246-19 by revising the introductory
paragraph, the date of the clause, and paragraph (a) of the clause to
read as follows:
52.246-19 Warranty of Systems and Equipment under Performance
Specifications or Design Criteria.
As prescribed in 46.710(c)(1), the contracting officer may insert a
clause substantially as follows:
WARRANTY OF SYSTEMS AND EQUIPMENT UNDER PERFORMANCE SPECIFICATIONS OR
DESIGN CRITERIA (MAR 2001)
(a) Definitions. As used in this clause--
Acceptance means the act of an authorized representative of the
Government by which the Government assumes for itself, or as an
agent of another, ownership of existing and identified supplies, or
approves specific services rendered, as partial or complete
performance of the contract.
Defect means any condition or characteristic in any supplies or
services furnished by the Contractor under the contract that is not
in compliance with the requirements of the contract.
Supplies means the end items furnished by the Contractor and
related services required under this contract. Except when this
contract includes the clause entitled Warranty of Data, supplies
also mean ``data.''
* * * * *
136. Amend section 52.246-20 by revising the introductory paragraph
and the date of the clause; and in paragraph (a) of the clause by
removing the paragraph heading ``Definitions'' and adding
``Definition'' in its place; and by removing the definition
``Correction''. The revised text reads as follows:
52.246-20 Warranty of Services.
As prescribed in 46.710(d), insert a clause substantially as
follows:
WARRANTY OF SERVICES (MAR 2001)
* * * * *
[FR Doc. 01-11 Filed 1-9-01; 8:45 am]
BILLING CODE 6820-EP-P
[Federal Register: January 10, 2001 (Volume 66, Number 7)]
[Rules and Regulations]
[Page 2136-2137]
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[DOCID:fr10ja01-25]
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DEPARTMENT OF DEFENSE
GENERAL SERVICES ADMINISTRATION
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
48 CFR Parts 30 and 52
[FAC 97-22; FAR Case 2000-301; Item II]
RIN 9000-AI79
Federal Acquisition Regulation; Applicability, Thresholds and
Waiver of Cost Accounting Standards Coverage
AGENCIES: Department of Defense (DoD), General Services Administration
(GSA), and National Aeronautics and Space Administration (NASA).
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: The Civilian Agency Acquisition Council and the Defense
Acquisition Regulations Council (Councils) have agreed on a final rule
amending the Federal Acquisition Regulation (FAR) to implement Section
802 of the National Defense Authorization Act for Fiscal Year 2000 and
the Cost Accounting Standards (CAS) Board's final rule, Applicability,
Thresholds and Waiver of Cost Accounting Standards Coverage. The FAR
rule revises CAS applicability requirements, dollar thresholds, and
waiver requirements.
DATES: Effective Date: January 10, 2001.
FOR FURTHER INFORMATION CONTACT: The FAR Secretariat, Room 4035, GS
Building, Washington, DC, 20405, (202) 501-4755, for information
pertaining to status or publication schedules. For clarification of
content, contact Ms. Linda Nelson, Procurement Analyst, at (202) 501-
1900. Please cite FAC 97-22, FAR case 2000-301.
SUPPLEMENTARY INFORMATION:
A. Background
Section 802 of the National Defense Authorization Act for Fiscal
Year 2000 (Pub. L. 106-65)--
Revised, at 41 U.S.C. 422(f)(2)(B), the categories of
contracts and subcontracts that are exempt from all CAS requirements;
Required the Administrator for Federal Procurement Policy
to revise the rules and procedures issued under 41 U.S.C. 422(f) to
increase the dollar threshold for full CAS coverage from $25 million to
$50 million; and
Revised 41 U.S.C. 422(f) to permit the head of an
executive agency to waive the applicability of CAS under certain
conditions.
In response to Public Law 106-65, the CAS Board in the Office of
Federal Procurement Policy published an interim rule in the Federal
Register on February 7, 2000 (65 FR 5990). The CAS Board rule,
Applicability, Thresholds and Waiver of Cost Accounting Standards
Coverage, amended the regulations at 48 CFR part 9903 to implement
Section 802. After analysis of public comments, the CAS Board converted
its interim rule to a final rule, with no change, and published the
final rule in the Federal Register on June 9, 2000 (65 FR 36768).
DoD, GSA, and NASA published an interim rule in the Federal
Register at 65 FR 36028, June 6, 2000. One respondent submitted public
comments on the interim rule. The Councils considered all comments
before agreeing to convert the interim rule to a final rule without
change.
This FAR rule--
Amends the provision at FAR 52.230-1, Cost Accounting
Standards Notices and Certification, to remove the requirement that a
contractor or subcontractor must have received at least one CAS-covered
contract exceeding $1 million (``trigger contract'') to be subject to
``full CAS coverage,'' since the CAS Board removed this ``trigger
contract'' amount from its corresponding solicitation provision, Cost
Accounting Standards Notices and Certification, at 48 CFR 9903.201-3.
The CAS Board added a new ``trigger contract'' dollar amount of $7.5
million at paragraph (b)(7) of 48 CFR 9903.201-1, CAS applicability,
which is already referenced at FAR 30.201-1;
Revises FAR 30.201-4(b)(1), Disclosure and consistency of
cost accounting practices, and amends the provision at FAR 52.230-1 to
reflect changes made by the CAS Board to
[[Page 2137]]
increase the dollar threshold for full CAS coverage from $25 million to
$50 million; and
Revises the CAS waiver procedures and conditions at FAR
30.201-5, as required by Section 802 of Pub. L. 106-65.
This is not a significant regulatory action, and therefore, was not
subject to review under Section 6(b) of Executive Order 12866,
Regulatory Planning and Review, dated September 30, 1993. This rule is
not a major rule under 5 U.S.C. 804.
B. Regulatory Flexibility Act
The Department of Defense, the General Services Administration, and
the National Aeronautics and Space Administration certify that this
final rule will not have a significant 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 contracts and
subcontracts with small businesses are exempt from all CAS requirements
in accordance with 48 CFR 9903.201-1(b)(3).
C. Paperwork Reduction Act
The Paperwork Reduction Act does not apply because the changes to
the FAR do not impose information collection requirements that 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 30 and 52
Government procurement.
Dated: December 22, 2000.
Al Matera,
Acting Director, Federal Acquisition Policy Division
Interim Rule Adopted as Final Without Change
Accordingly, DoD, GSA, and NASA adopt the interim rule amending 48
CFR parts 30 and 52, which was published in the Federal Register at 65
FR 36028, June 6, 2000, as a final rule without change.
Authority: 40 U.S.C. 486(c); 10 U.S.C. chapter 137; and 42
U.S.C. 2473(c).
[FR Doc. 01-12 Filed 1-9-01; 8:45 am]
BILLING CODE 6820-EP-P
[Federal Register: January 10, 2001 (Volume 66, Number 7)]
[Rules and Regulations]
[Page 2137-2139]
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[DOCID:fr10ja01-26]
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DEPARTMENT OF DEFENSE
GENERAL SERVICES ADMINISTRATION
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
48 CFR Parts 32 and 52
[FAC 97-22; FAR Case 1999-016; Item III]
RIN 9000-AI74
Federal Acquisition Regulation; Advance Payments for Non-
Commercial Items
AGENCIES: Department of Defense (DoD), General Services Administration
(GSA), and National Aeronautics and Space Administration (NASA).
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: The Civilian Agency Acquisition Council and the Defense
Acquisition Regulations Council (Councils) have agreed on a final rule
amending the Federal Acquisition Regulation (FAR) to permit federally
insured credit unions to participate in the maintenance of special
accounts for advance payments.
DATE: Effective Date: March 12, 2001.
FOR FURTHER INFORMATION CONTACT: The FAR Secretariat, Room 4035, GS
Building, Washington, DC, 20405, (202) 501-4755, for information
pertaining to status or publication schedules. For clarification of
content, contact Mr. Jeremy Olson, at (202) 501-4755. Please cite FAC
97-22, FAR case 1999-016.
SUPPLEMENTARY INFORMATION:
A. Background
Prior to publication of this final FAR rule, FAR Subpart 32.4,
Advance Payments for Non-Commercial Items, required, unless exempted by
FAR 32.409-3(e) or (f), that contractors deposit advance payments in
special accounts separate from their general or other funds. FAR 32.411
and other FAR text excluded credit unions from participating in the
maintenance of these special accounts by requiring that contractors
establish these special accounts only at banks that are members of the
Federal Reserve System (FRS) or insured by the Federal Deposit
Insurance Corporation (FDIC). However, many credit unions are federally
insured through the National Credit Union Administration (NCUA).
Therefore, these credit unions also are able to provide the Government
a measure of security for Federal funds advanced to contractors.
This final rule amends FAR Subpart 32.4 and FAR 52.232-12 to change
certain terminology (e.g., change the word ``bank'' to ``financial
institution'') to provide contractors an additional option of
depositing advance payments in special accounts maintained by credit
unions that are federally insured by NCUA. This revision will foster
competition among financial institutions that are in the business of
providing special accounts for advance payment funds, without
increasing the risk to the Government.
DoD, GSA, and NASA published a proposed rule in the Federal
Register at 65 FR 25614, May 2, 2000. Two respondents submitted public
comments on the proposed rule. The Councils considered all comments
before agreeing to convert the proposed rule to a final rule without
change.
This is not a significant regulatory action, and therefore, was not
subject to review under Section 6(b) of Executive Order 12866,
Regulatory Planning and Review, dated September 30, 1993. This rule is
not a major rule under 5 U.S.C. 804.
B. Regulatory Flexibility Act
The Department of Defense, the General Services Administration, and
the National Aeronautics and Space Administration certify that this
final rule will not have a significant 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 only applies
to the very limited number of contractors that receive advance payments
and deposit these payments in special accounts.
C. Paperwork Reduction Act
The Paperwork Reduction Act does not apply because the changes to
the FAR do not impose information collection requirements that 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 32 and 52
Government procurement.
Dated: December 22, 2000.
Al Matera,
Acting Director, Federal Acquisition Policy Division.
Therefore, DoD, GSA, and NASA amend 48 CFR parts 32 and 52 as set
forth below:
1. The authority citation for 48 CFR parts 32 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).
[[Page 2138]]
PART 32--CONTRACT FINANCING
2. Revise paragraph (a)(1) of section 32.407 to read as follows:
32.407 Interest.
(a) * * *
(1) The published prime rate of the financial institution
(depository) in which the special account (see 32.409-3) is
established; or
* * * * *
32.408 [Amended]
3. Amend paragraph (b)(4) of section 32.408 by removing ``bank''
both times it appears and adding ``financial institution'' in its
place.
4. Amend section 32.409-3 as follows:
a. In paragraph (a) remove ``bank'' and add ``special'' in its
place;
b. In paragraphs (b)(2), (c)(2), and (e) remove ``bank''.
c. Revise paragraph (f)(1); and
d. In paragraph (g) remove ``bank'' both times it appears.
The revised text reads as follows:
32.409-3 Security, supervision, and covenants.
* * * * *
(f) * * *
(1) The use under a cost-reimbursement contract of Federal funds
deposited in the contractor's account at a financial institution
(without the contractor acquiring title to the funds); and
* * * * *
5. In section 32.410, revise the second sentence in paragraph
(a)(4) of the ``Findings, Determination, and Authorization for Advance
Payments Findings'' to read as follows:
32.410 Findings, determination, and authorization.
* * * * *
(a) * * *
(4) * * * The clause requires that all payments will be
deposited in a special account at the Contractor's financial
institution and that the Government will have a paramount lien on
(i) the credit balance in the special account, (ii) any supplies
contracted for, and (iii) any material or other property acquired
for performance of the contract. * * *
* * * * *
6. Revise 32.411 to read as follows:
32.411 Agreement for special account at a financial institution.
The contracting officer must use substantially the following form
of agreement for a special account for advance payments:
Agreement for Special Account
This agreement is entered into this ____ day of ____, 20____,
between the United States of America (the Government), represented
by the Contracting Officer executing this agreement, ________
[Insert the name of the Contractor], a ________ [Insert the name of
the State of incorporation] corporation (the Contractor), and
________, a financial institution operating under the laws of
________, located at ________ (the financial institution).
Recitals
(a) Under date of ________, 20________, the Government and the
Contractor entered into Contract No. ____, or a related supplemental
agreement, providing for advance payments to the Contractor. A copy
of the advance payment terms was furnished to the financial
institution.
(b) The contract or supplemental agreement requires that amounts
advanced to the Contractor be deposited separate from the
Contractor's general or other funds, in a Special Account at a
member bank of the Federal Reserve System, any ``insured'' bank
within the meaning of the Act creating the Federal Deposit Insurance
Corporation (12 U.S.C. 1811), or a credit union insured by the
National Credit Union Administration. The parties agree to deposit
the amounts with the financial institution, which meets the
requirement.
(c) This Special Account is designated ``________ [Insert the
Contractor's name], ________ [Insert the name of the Government
agency] Special Account.''
Covenants
In consideration of the foregoing, and for other good and
valuable considerations, the parties agree to the following
conditions:
(a) The Government shall have a lien on the credit balance in
the account to secure the repayment of all advance payments made to
the Contractor. The lien is paramount to any lien or claim of the
financial institution regarding the account.
(b) The financial institution is bound by the terms of the
contract relating to the deposit and withdrawal of funds in the
Special Account, but is not responsible for the application of funds
withdrawn from the account. The financial institution shall act on
written directions from the Contracting Officer, the administering
office, or a duly authorized representative of either. The financial
institution is not liable to any party to this agreement for any
action that complies with the written directions. Any written
directions received by the financial institution through the
Contracting Officer on ________ [Insert the name of the agency]
stationery and purporting to be signed by, or by the direction of
________ or duly authorized representative, shall be, as far as the
rights, duties, and liabilities of the financial institution are
concerned, considered as being properly issued and filed with the
financial institution by the ________ [Insert the name of the
agency].
(c) The Government, or its authorized representatives, shall
have access to the books and records maintained by the financial
institution regarding the Special Account at all reasonable times
and for all reasonable purposes, including (but not limited to), the
inspection or copying of the books and records and any and all
pertinent memoranda, checks, correspondence, or documents. The
financial institution shall preserve the books and records for a
period of 6 years after the closing of this Special Account.
(d) In the event of the service of any writ of attachment, levy
of execution, or commencement of garnishment proceedings regarding
the Special Account, the financial institution will promptly notify
________ [Insert the name of the administering office].
(e) While this Special Account exists, the financial institution
shall inform the Government each month of the financial
institution's published prime interest rate and changes to the rate
during the month. The financial institution shall give this
information to the Contracting Officer on the last business day of
the month. [This covenant will not be included in the Special
Account Agreements covering interest-free advance payments.]
Each of the parties to this agreement has executed the agreement
on ________, 20____.
----------------------------------------------------------------------
----------------------------------------------------------------------
[Signatures and Official Titles]
32.412 [Amended]
7. Amend paragraph (f) of section 32.412 by removing ``bank''.
PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES
8. Amend section 52.232-12 as follows:
a. Revise the date of the clause;
b. Revise paragraph (b);
c. Remove ``bank'' from paragraphs (c) and (d);
d. Revise paragraph (f)(3);
e. Revise paragraph (g);
f. Remove ``bank'' from paragraphs (h), (k)(1) introductory text,
(k)(1)(iv), (k)(2)(i), and (m)(1) each time it appears;
g. Revise paragraph (p)(11);
h. Amend Alternate II by revising the date to read ``(Mar 2001) '';
and removing ``bank'' from paragraph (c); and
i. Amend Alternate V by revising the date to read ``(Mar 2001)'';
removing from the introductory paragraph ``bank''; and revising the
heading of the clause and paragraph (m)(11) of Alternate V to read as
follows:
52.232-12 Advance Payments.
* * * * *
Advance Payments (Mar 2001)
* * * * *
(b) Special account. Until (1) the Contractor has liquidated all
advance payments made under the contract and related interest
charges and (2) the administering office has approved in writing the
release of any funds due and payable to the Contractor, all advance
payments and other payments under this contract shall be made by
check payable to the Contractor marked for deposit only in the
Contractor's
[[Page 2139]]
special account with the ________ [insert the name of the financial
institution]. None of the funds in the special account shall be
mingled with other funds of the Contractor. Withdrawals from the
special account may be made only by check of the Contractor
countersigned by the Contracting Officer or a Government
countersigning agent designated in writing by the Contracting
Officer.
* * * * *
(f) * * *
(3) If interest is required under the contract, the Contracting
Officer shall determine a daily interest rate based on the higher of
(i) the published prime rate of the financial institution
(depository) in which the special account is established or (ii) the
rate established by the Secretary of the Treasury under Pub. L. 92-
41 (50 U.S.C. App. 1215(b)(2)). The Contracting Officer shall revise
the daily interest rate during the contract period in keeping with
any changes in the cited interest rates.
* * * * *
(g) Financial institution agreement. Before an advance payment
is made under this contract, the Contractor shall transmit to the
administering office, in the form prescribed by the administering
office, an agreement in triplicate from the financial institution in
which the special account is established, clearly setting forth the
special character of the account and the responsibilities of the
financial institution under the account. The Contractor shall select
a financial institution that is a member bank of the Federal Reserve
System, an ``insured'' bank within the meaning of the Federal
Deposit Insurance Corporation Act (12 U.S.C. 1811), or a credit
union insured by the National Credit Union Administration.
* * * * *
(p) * * *
(11) Deposit any of its funds except in a bank or trust company
insured by the Federal Deposit Insurance Corporation or a credit
union insured by the National Credit Union Administration;
* * * * *
Advance Payments Without Special Account (Mar 2001)
* * * * *
(m) * * *
(11) Deposit any of its funds except in a bank or trust company
insured by the Federal Deposit Insurance Corporation or a credit
union insured by the National Credit Union Administration;
* * * * *
[FR Doc. 01-13 Filed 1-9-01; 8:45 am]
BILLING CODE 6820-EP-P
[Federal Register: January 10, 2001 (Volume 66, Number 7)]
[Rules and Regulations]
[Page 2139-2140]
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[DOCID:fr10ja01-27]
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DEPARTMENT OF DEFENSE
GENERAL SERVICES ADMINISTRATION
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
48 CFR Part 52
[FAC 97-22; FAR Case 1999-021; Item IV]
RIN 9000-AJ05
Federal Acquisition Regulation; Part 12 and Assignment of Claims
AGENCIES: Department of Defense (DoD), General Services Administration
(GSA), and National Aeronautics and Space Administration (NASA).
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: The Civilian Agency Acquisition Council and the Defense
Acquisition Regulations Council (Councils) have agreed on a final rule
amending the Federal Acquisition Regulation (FAR) to add, in the
contract clause addressing terms and conditions for commercial items,
the prohibition for a contractor to assign its rights to receive
payment in accordance with the Assignment of Claims Act (31 U.S.C.
3727) when a third party makes payment under the contract (e.g., use of
the Governmentwide commercial purchase card). This prohibition is
currently in the contract clause addressing terms and conditions
required to implement statutes or Executive orders for commercial
items.
DATES: Effective Date: March 12, 2001.
FOR FURTHER INFORMATION CONTACT: The FAR Secretariat, Room 4035, GS
Building, Washington, DC 20405, (202) 501-4755, for information
pertaining to status or publication schedules. For clarification of
content, contact Ms. Victoria Moss, Procurement Analyst, at (202) 501-
4764. Please cite FAC 97-22, FAR case 1999-021.
SUPPLEMENTARY INFORMATION:
A. Background
Paragraph (e) of the clause at FAR 52.232-36, Payment by Third
Party, states that a contractor may not assign its rights to receive
payment under the assignment of claims terms of the contract if payment
is made by a third party (e.g., use of the Governmentwide commercial
purchase card). This clause is included in paragraph (b)(25) of the
clause at FAR 52.212-5, Contract Terms and Conditions Required to
Implement Statutes or Executive Orders--Commercial Items.
Paragraph (b) of the clause at FAR 52.212-4, Contract Terms and
Conditions--Commercial Items, states that a contractor may assign its
rights to receive payments due as a result of performance of the
contract, but paragraph (b) does not include the prohibition against
the assignment of claims if payment is made by a third party (e.g., use
of the Governmentwide commercial purchase card). FAR 12.302(b) further
states that the contracting officer shall not tailor FAR 52.212-4(b).
The purpose of this rule is to correct the inconsistency between
FAR 52.212-4(b) and FAR 52.212-5(b)(25). The rule revises FAR 52.212-
4(b) to add the prohibition against the assignment of claims when
payment is made by a third party.
This is not a significant regulatory action, and therefore, was not
subject to review under Section 6(b) of Executive Order 12866,
Regulatory Planning and Review, dated September 30, 1993. This rule is
not a major rule under 5 U.S.C. 804.
B. Regulatory Flexibility Act
The final rule does not constitute a significant FAR revision
within the meaning of FAR 1.501 and Public Law 98-577, and publication
for public comments is not required. However, the Councils will
consider comments from small entities concerning the affected FAR part
52 in accordance with 5 U.S.C. 610. Interested parties must submit such
comments separately and should cite 5 U.S.C. 601, et seq. (FAC 97-22,
FAR case 1999-021), in correspondence.
C. Paperwork Reduction Act
The Paperwork Reduction Act does not apply because the changes to
the FAR do not impose information collection requirements that require
the approval of the Office of Management and Budget under 44 U.S.C.
3501, et seq.
List of Subjects in 48 CFR part 52
Government procurement.
Dated: December 22, 2000.
Al Matera,
Acting Director, Federal Acquisition Policy Division.
Therefore, DoD, GSA, and NASA amend 48 CFR part 52 as set forth
below:
PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES
1. The authority citation for 48 CFR part 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).
2. Amend section 52.212-4 by revising the date of the clause and
paragraph (b) to read as follows:
[[Page 2140]]
52.212-4 Contract Terms and Conditions--Commercial Items.
* * * * *
Contract Terms and Conditions--Commercial Items (Mar 2001)
* * * * *
(b) Assignment. The Contractor or its assignee may assign its
rights to receive payment due as a result of performance of this
contract to a bank, trust company, or other financing institution,
including any Federal lending agency in accordance with the
Assignment of Claims Act (31 U.S.C. 3727). However, when a third
party makes payment (e.g., use of the Governmentwide commercial
purchase card), the Contractor may not assign its rights to receive
payment under this contract.
* * * * *
[FR Doc. 01-14 Filed 1-9-01; 8:45 am]
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DEPARTMENT OF DEFENSE
GENERAL SERVICES ADMINISTRATION
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
48 CFR Part 52
[FAC 97-22; FAR Case 1996-023; Item V]
RIN 9000-AJ06
Federal Acquisition Regulation; Clause Flowdown-Commercial Items
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 (Councils) have agreed on a final rule
amending the Federal Acquisition Regulation (FAR) to clarify
requirements for the inclusion of FAR clauses in subcontracts for
commercial items awarded under contracts for other than commercial
items.
DATES: Effective Date: March 12, 2001.
FOR FURTHER INFORMATION CONTACT: The FAR Secretariat, Room 4035, GS
Building, Washington, DC, 20405, (202) 501-4755, for information
pertaining to status or publication schedules. For clarification of
content, contact Ms. Victoria Moss, Procurement Analyst, at (202) 501-
4764. Please cite FAC 97-22, FAR case 1996-023.
SUPPLEMENTARY INFORMATION:
A. Background
This final rule amends the clause at FAR 52.244-6, Subcontracts for
Commercial Items, to revise the list of clauses the contractor must
flow down to subcontractors and to clarify that contractors may flow
down a minimal number of other clauses.
DoD, GSA, and NASA published a proposed rule in the Federal
Register at 62 FR 49903, September 23, 1997. Four sources submitted
comments in response to the proposed rule. The Councils considered all
comments in the development of the final rule.
This is not a significant regulatory action, and therefore, was not
subject to review under Section 6(b) of Executive Order 12866,
Regulatory Planning and Review, dated September 30, 1993. This rule is
not a major rule under 5 U.S.C. 804.
B. Regulatory Flexibility Act
The Department of Defense, the General Services Administration, and
the National Aeronautics and Space Administration certify that this
final rule will not have a significant 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 merely
clarifies existing requirements regarding the inclusion of clauses in
subcontracts for commercial items awarded under contracts for other
than commercial items.
C. Paperwork Reduction Act
The Paperwork Reduction Act does not apply because the changes to
the FAR do not impose information collection requirements that require
the approval of the Office of Management and Budget under 44 U.S.C.
3501, et seq.
List of Subjects in 48 CFR Part 52
Government procurement.
Dated: December 22, 2000.
Al Matera,
Acting Director, Federal Acquisition Policy Division.
Therefore, DoD, GSA, and NASA amend 48 CFR part 52 as set forth
below:
PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES
1. The authority citation for 48 CFR part 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).
52.213-4 [Amended]
2. Amend section 52.213-4 by removing from the clause heading
``(July 2000)'' and adding ``(Mar 2001)'' in its place; and be removing
``(Oct 1998)'' from paragraph (a)(2)(vi) of the clause and adding ``Mar
2001'' in its place.
3. Amend section 52.244-6 by revising the section heading, the
introductory text of paragraph (a), and the clause heading; removing
``, as used in this clause,'' from the definitions ``Commercial item''
and ``Subcontract''; and by revising paragraph (c) to read as follows:
52.244-6 Subcontracts for Commercial Items.
* * * * *
Subcontracts for Commercial Items
(Mar 2001)
(a) Definitions. As used in this clause--
* * * * *
(c)(1) The following clauses shall be flowed down to
subcontracts for commercial items:
(i) 52.219-8, Utilization of Small Business Concerns (OCT 2000)
(15 U.S.C. 637(d)(2) and (3)), in all subcontracts that offer
further subcontracting opportunities. If the subcontract (except
subcontracts to small business concerns) exceeds $500,000
($1,000,000 for construction of any public facility), the
subcontractor must include 52.219-8 in lower tier subcontracts that
offer subcontracting opportunities.
(ii) 52.222-26, Equal Opportunity (FEB 1999) (E.O. 11246).
(iii) 52.222-35, Affirmative Action for Disabled Veterans and
Veterans of the Vietnam Era (APR 1998) (38 U.S.C. 4212(a)).
(iv) 52.222-36, Affirmative Action for Workers with Disabilities
(JUN 1998) (29 U.S.C. 793).
(v) 52.247-64, Preference for Privately Owned U.S.-Flagged
Commercial Vessels (JUN 2000) (46 U.S.C. Appx 1241) (flowdown not
required for subcontracts awarded beginning May 1, 1996).
(2) While not required, the Contractor may flow down to
subcontracts for commercial items a minimal number of additional
clauses necessary to satisfy its contractual obligations.
* * * * *
[FR Doc. 01-15 Filed 1-9-01; 8:45 am]
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DEPARTMENT OF DEFENSE
GENERAL SERVICES ADMINISTRATION
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
48 CFR Parts 1, 19, 22, 42, 52, and 53
[FAC 97-22; Item VI]
Federal Acquisition Regulation; Technical Amendments
AGENCIES: Department of Defense (DoD), General Services Administration
(GSA), and National Aeronautics and Space Administration (NASA).
ACTION: Final rule.
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SUMMARY: This document makes amendments to the Federal Acquisition
[[Page 2141]]
Regulation in order to update references and make editorial changes.
DATES: Effective Date: January 10, 2001.
FOR FURTHER INFORMATION CONTACT: The FAR Secretariat, Room 4035, GS
Building, Washington, DC 20405, (202) 501-4755.
List of Subjects in 48 CFR parts 1, 19, 22, 42, 52, and 53
Government procurement.
Dated: December 22, 2000.
Al Matera,
Acting Director, Federal Acquisition Policy Division.
Therefore, DoD, GSA, and NASA amend 48 CFR parts 1, 19, 22, 42, 52,
and 53 as set forth below:
1. The authority citation for 48 CFR parts 1, 19, 22, 42, 52, and
53 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 1--FEDERAL ACQUISITION REGULATIONS SYSTEM
1.106 [Amended]
2. Amend section 1.106 in the table following the introductory
paragraph at entry 52.215-19 by removing the OMB Control Number ``9000-
0015'' and adding ``9000-0115'' in its place.
PART 19--SMALL BUSINESS PROGRAMS
3. Amend section 19.812 by revising paragraph (a) to read as
follows:
19.812 Contract administration.
(a) The contracting officer shall assign contract administration
functions, as required, based on the location of the 8(a) contractor
(see Federal Directory of Contract Administration Services Components
(available via the Internet at http://www.dcma.mil/casbook/
casbook.htm)).
* * * * *
PART 22--APPLICATION OF LABOR LAWS TO GOVERNMENT ACQUISITIONS
4. Amend section 22.403-4 as follows:
a. Redesignate paragraphs ``(a)'', ``(b)'', ``(c)'', ``(d)'', and
``(e)'' as ``(b)(1)'', ``(b)(2)'', ``(b)(3)'', ``(b)(4)'', and
``(b)(5)'', respectively;
b. Designate the introductory paragraph as paragraph (a), and amend
it by removing ``The Department of Labor regulations include--'';
c. Add paragraph (b) introductory text;
d. In newly designated paragraph (b)(5), remove the last sentence;
and
e. Add a new paragraph (c) to read as follows:
22.403-4 Department of Labor regulations.
* * * * *
(b) The Department of Labor regulations include--
* * * * *
(c) Refer all questions relating to the application and
interpretation of wage determinations (including the classifications
therein) and the interpretation of the Department of Labor regulations
in this subsection to the Administrator, Wage and Hour Division.
PART 42--CONTRACT ADMINISTRATION AND AUDIT SERVICES
5. Amend section 42.201 by revising paragraph (b) to read as
follows:
42.201 Contract administration responsibilities.
* * * * *
(b) The Defense Contract Management Agency and other agencies offer
a wide variety of contract administration and support services.
6. Revise section 42.203 to read as follows:
42.203 Contract administration services directory.
The Defense Contract Management Agency (DCMA) maintains and
distributes the Federal Directory of Contract Administration Services
Components. The directory lists the names and telephone numbers of
those DCMA and other agency offices that offer contract administration
services within designated geographic areas and at specified contractor
plants. Federal agencies may obtain a free copy of the directory on
disk by writing to--Defense Contract Management Agency, ATTN: DCMA-FBP,
8725 John J. Kingman Road, Fort Belvoir, VA 22060-6221, or access it on
the Internet at http://www.dcma.mil/casbook/casbook.htm.
PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES
52.247-51 [Amended]
7. Amend section 52.247-51 in the provision heading by removing
``(FEB 1995)'' and adding ``(JAN 2001)'' in its place; in the first
sentence of paragraph (c)(1) by removing ``F.o.b. port of loading with
inspection and acceptance at origin.''; and in the third column of the
table following paragraph (d), add a comma after ``i.e.''.
PART 53--FORMS
53.215-1 [Amended]
8. Amend section 53.215-1 by removing from paragraph (a)
``15.509(b)'' and adding ``15.509'' in its place; and by removing from
paragraphs (e) and (f) ``15.509(a)'' and adding ``15.509'' in their
place.
[FR Doc. 01-16 Filed 1-9-01; 8:45 am]
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DEPARTMENT OF DEFENSE
GENERAL SERVICES ADMINISTRATION
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
48 CFR Ch. 1
Federal Acquisition Regulation; Small Entity Compliance Guide
AGENCIES: Department of Defense (DoD), General Services Administration
(GSA), and National Aeronautics and Space Administration (NASA).
ACTION: Small Entity Compliance Guide.
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SUMMARY: This document is issued under the joint authority of the
Secretary of Defense, the Administrator of General Services and the
Administrator for the National Aeronautics and Space Administration.
This Small Entity Compliance Guide has been prepared in accordance with
Section 212 of the Small Business Regulatory Enforcement Fairness Act
of 1996 (Public Law 104-121). It consists of a summary of rules
appearing in Federal Acquisition Circular (FAC) 97-22 which amend the
FAR. An asterisk (*) next to a rule indicates that a regulatory
flexibility analysis has been prepared in accordance with 5 U.S.C. 604.
Interested parties may obtain further information regarding these rules
by referring to FAC 97-22 which precedes this document. These documents
are also available via the Internet at http://www.arnet.gov/far.
FOR FURTHER INFORMATION CONTACT: Laurie Duarte, FAR Secretariat, (202)
501-4225. For clarification of content, contact the analyst whose name
appears in the table below.
[[Page 2142]]
List of Rules in FAC 97-22
----------------------------------------------------------------------------------------------------------------
Item Subject FAR Case Analyst
----------------------------------------------------------------------------------------------------------------
I....................................... Definitions................. 1999-403 Linfield.
II...................................... Applicability, Thresholds 2000-301 Nelson.
and Waiver of Cost
Accounting Standards
Coverage.
III..................................... Advance Payments for Non- 1999-016 Olson.
Commercial Items.
IV...................................... Part 12 and Assignment of 1999-021 Moss.
Claims.
V....................................... Clause Flowdown--Commercial 1996-023 Moss.
Items.
----------------------------------------------------------------------------------------------------------------
SUPPLEMENTARY INFORMATION: Summaries for each FAR rule follow. For the
actual revisions and/or amendments to these FAR cases, refer to the
specific item number and subject set forth in the documents following
these item summaries.
Federal Acquisition Circular 97-22 amends the FAR as specified
below:
Item I--Definitions (FAR Case 1999-403)
This final rule clarifies the applicability of definitions used in
the FAR, eliminates redundant or conflicting definitions, and makes
definitions easier to find. The rule--
Relocates definitions of terms that are used in more than
one FAR part with the same meaning to 2.101;
Relocates other definitions of terms to the
``Definitions'' section of the highest level FAR division (part,
subpart, or section) where the term as defined is used. For example, if
a term was defined in a FAR section, but the term is used as defined in
another section of that subpart, then the definition was moved to the
``Definitions'' section of that subpart;
Clarifies that a term, defined in FAR 2.101, has the same
meaning throughout the FAR unless the context in which the term is used
clearly requires a different meaning; or unless another FAR part,
subpart, or section provides a different definition for that particular
part, subpart, or section;
Adds cross-references to definitions of terms in FAR 2.101
that are defined differently in another part, subpart, or section of
the FAR; and
Makes technical corrections throughout the FAR.
Item II--Applicability, Thresholds and Waiver of Cost Accounting
Standards Coverage (FAR Case 2000-301)
The interim rule published as Item VIII of FAC 97-18 (65 FR 36028,
June 6, 2000) is converted to a final rule without change. This rule
amends FAR Subpart 30.2, CAS Program Requirements, and the FAR clause
at 52.230-1, Cost Accounting Standards Notices and Certification, to
implement Section 802 of the National Defense Authorization Act for
Fiscal Year 2000 (Pub. L. 106-65) and the Cost Accounting Standards
(CAS) Board's final rule, Applicability, Thresholds and Waiver of Cost
Accounting Standards Coverage. The FAR rule revises policies affecting
which contractors and subcontractors must comply with CAS by--
Removing the requirement at FAR 52.230-1, Cost Accounting
Standards Notices and Certification, that a contractor or subcontractor
must have received at least one CAS-covered contract exceeding $1
million (``trigger contract'') to be subject to ``full CAS coverage.''
The CAS Board added a new ``trigger contract'' dollar amount of $7.5
million at paragraph (b)(7) of 48 CFR 9903.201-1, CAS applicability,
which is already referenced at FAR 30.201-1;
Revising FAR 30.201-4(b), Disclosure and consistency of
cost accounting practices, and FAR 52.230-1 to increase the dollar
threshold for full CAS coverage from $25 million to $50 million; and
Revising the CAS waiver procedures and conditions at FAR
30.201-5.
Item III--Advance Payments for Non-Commercial Items (FAR Case 99-
016)
This final rule amends the FAR to permit federally insured credit
unions, in addition to banks, to participate in the maintenance of
special accounts for advance payments. The rule will only affect
contracting officers that provide contract financing using advance
payments for non-commercial items.
Item IV--Part 12 and Assignment of Claims (FAR Case 1999-021)
This final rule amends the FAR to correct an inconsistency between
two clauses related to the assignment of claims. FAR 52.232-36, Payment
by Third Party, prohibits a contractor from assigning its rights to
receive payment under the contract if payment is made by a third party,
such as when a Governmentwide commercial purchase card is used. This
clause is cited in the contract clause at FAR 52.212-5 that addresses
terms and conditions required to implement statutes or Executive orders
for commercial items.
FAR 52.212-4, Contract Terms and Conditions--Commercial Items,
addresses assignment of claims but does not include the third party
prohibition. This rule revises FAR 52.212-4(b) to add the prohibition.
Item V--Clause Flowdown--Commercial Items (FAR Case 1996-023)
This final rule amends the clause at FAR 52.244-6, Subcontracts for
Commercial Items, to revise the listing of clauses the contractor must
flow down to subcontractors. The rule revises the listing to add the
clause at FAR 52.219-8, Utilization of Small Business Concerns, when
specified circumstances have been met. In addition, the rule adds
language to inform contractors that they may flow down a minimal number
of additional clauses to subcontractors to satisfy their contractual
obligations.
Dated: December 22, 2000.
Al Matera,
Acting Director, Federal Acquisition Policy Division.
[FR Doc. 01-17 Filed 1-9-01; 8:45 am]
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