[Federal Register: March 23, 2005 (Volume 70, Number 55)]
[Proposed Rules]
[Page 14625-14628]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr23mr05-50]
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DEPARTMENT OF DEFENSE
48 CFR Parts 225 and 252
[DFARS Case 2003-D008]
Defense Federal Acquisition Regulation Supplement; Foreign
Acquisition
AGENCY: Department of Defense (DoD).
ACTION: Proposed rule with request for comments.
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SUMMARY: DoD is proposing to amend the Defense Federal Acquisition
Regulation Supplement (DFARS) to update text pertaining to the
acquisition of supplies and services from foreign sources. This
proposed rule is a result of a transformation initiative undertaken by
DoD to dramatically change the purpose and content of the DFARS.
DATES: Comments on the proposed rule should be submitted in writing to
the address shown below on or before May 23, 2005, to be considered in
the formation of the final rule.
ADDRESSES: You may submit comments, identified by DFARS Case 2003-D008,
using any of the following methods:
Federal eRulemaking Portal: http://www.regulations.gov.
Follow the instructions for submitting comments.
Defense Acquisition Regulations Web Site: http://emissary.acq.osd.mil/dar/dfars.nsf/pubcomm.
Follow the instructions for
submitting comments.
E-mail: dfars@osd.mil. Include DFARS Case 2003-D008 in the
subject line of the message.
Fax: (703) 602-0350.
Mail: Defense Acquisition Regulations Council, Attn: Ms.
Amy Williams, OUSD(AT&L)DPAP(DAR), IMD 3C132, 3062 Defense Pentagon,
Washington, DC 20301-3062.
Hand Delivery/Courier: Defense Acquisition Regulations
Council, Crystal Square 4, Suite 200A, 241 18th Street, Arlington, VA
22202-3402.
All comments received will be posted to http://emissary.acq.osd.mil/dar/dfars.nsf
.
FOR FURTHER INFORMATION CONTACT: Ms. Amy Williams, (703) 602-0328.
SUPPLEMENTARY INFORMATION:
A. Background
DFARS Transformation is a major DoD initiative to dramatically
change the purpose and content of the DFARS. The objective is to
improve the
[[Page 14626]]
efficiency and effectiveness of the acquisition process, while allowing
the acquisition workforce the flexibility to innovate. The transformed
DFARS will contain only requirements of law, DoD-wide policies,
delegations of FAR authorities, deviations from FAR requirements, and
policies/procedures that have a significant effect beyond the internal
operating procedures of DoD or a significant cost or administrative
impact on contractors or offerors. Additional information on the DFARS
Transformation initiative is available at http://www.acq.osd.mil/dpap/dfars/transf.htm
.
This proposed rule is a result of the DFARS Transformation
Initiative. The proposed changes include--
Deletion of redundant or unnecessary text at DFARS
225.000, 225.171, 225.871-1(b), 225.7301(a)(1) through (3), and
225.7306.
Deletion of text at DFARS 225.001, 225.504, 225.802,
225.870-1(d), 225.870-5, 225.870-7, 225.871-5, 225.872-4, 225.872-5(b)
and (c), 225.872-6(c), 225.873-2, 225.902, 225.903, 225.7301(c) and
(d), and 225.7302 containing internal DoD procedures, guidance, or
information. This text will be relocated to the new DFARS companion
resource, Procedures, Guidance, and Information (PGI), available at
http://www.acq.osd.mil/dpap/dars/pgi.
Clarification of DFARS text as follows:
225.401-70--Addition of a statutory reference.
225.408--Clarification that the exception from FAR
25.408(a)(4) for overseas acquisitions applies only to the requirement
for submission of offers in U.S. dollars.
225.701--Expansion of cross-reference to restrictions on
contracting with firms owned or controlled by foreign governments that
support terrorism (from 209.104-1(g)(i) to 209.104-1(g)).
225.802-70--Addition of a reference to the Army in Europe
Regulation 715-9, for procedures for work performed in Germany.
225.871-6--Clarification that property that is jointly
acquired by the members of a NATO cooperative project may be disposed
of in accordance with the terms of the cooperative project agreement,
without regard to any laws of the United States applicable to the
disposal of property owned by the United States.
225.7003--Clarification that the waiver procedures in
225.7003 apply only if specifically authorized by reference elsewhere
in subpart 225.70.
225.7303-2(a)(3) and 225.7307--Addition of cross-
references.
225.7501(a)(2)(iii)--Deletion of a reference to DoD
Directive, 4120.3, Defense Standardization and Specification Program,
which was cancelled in 1991.
This rule was not subject to Office of Management and Budget review
under Executive Order 12866, dated September 30, 1993.
B. Regulatory Flexibility Act
DoD does not expect this rule to 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
makes no significant change to DoD contracting policy. Therefore, DoD
has not performed an initial regulatory flexibility analysis. DoD
invites comments from small businesses and other interested parties.
DoD also will consider comments from small entities concerning the
affected DFARS subparts in accordance with 5 U.S.C. 610. Such comments
should be submitted separately and should cite DFARS Case 2003-D008.
C. Paperwork Reduction Act
The Paperwork Reduction Act does not apply because the rule does
not impose any 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 225 and 252
Government procurement.
Michele P. Peterson,
Editor, Defense Acquisition Regulations System.
Therefore, DoD proposes to amend 48 CFR parts 225 and 252 as
follows:
1. The authority citation for 48 CFR parts 225 and 252 continues to
read as follows:
Authority: 41 U.S.C. 421 and 48 CFR Chapter 1.
PART 225--FOREIGN ACQUISITION
225.000 [Removed]
2. Section 225.000 is removed.
3. Section 225.001 is revised to read as follows:
225.001 General.
For guidance on evaluating offers of foreign end products, see PGI
225.001.
225.171 [Removed]
4. Section 225.171 is removed.
5. Section 225.401-70 is amended in the introductory text by
revising the last sentence to read as follows:
225.401-70 Products subject to trade agreements.
* * * However, 225.003 expands the definition of Caribbean Basin
country end products to include petroleum and any product derived from
petroleum, in accordance with Section 8094 of Public Law 103-139.
6. Section 225.408 is revised to read as follows:
225.408 Procedures.
(a)(4) The requirements of FAR 25.408(a)(4), on submission of
offers in U.S. dollars, do not apply to overseas acquisitions or to
Defense Energy Support Center post, camp, or station overseas
requirements.
7. Section 225.504 is revised to read as follows:
225.504 Evaluation examples.
For examples that illustrate the evaluation procedures in
225.502(c)(ii), see PGI 225.504.
8. Section 225.701 is revised to read as follows:
225.701 Restrictions.
See 209.104-1(g) for restrictions on contracting with firms owned
or controlled by foreign governments.
9. Section 225.802 is revised to read as follows:
225.802 Procedures.
(b) Information on memoranda of understanding and other
international agreements is available at PGI 225.802(b).
10. Section 225.802-70 is amended by adding paragraph (c) to read
as follows:
225.802-70 Contracts for performance outside the United States and
Canada.
* * * * *
(c) For work performed in Germany, eligibility for logistics
support and base privileges of contractor employees is governed by
U.S.-German bilateral agreements. Follow the procedures in Army in
Europe Regulation 715-9, available at http://www.chrma.hqusareur.army.mil/docper
.
11. Section 225.870-1 is amended by revising paragraph (d) and
removing paragraph (e). The revised text reads as follows:
225.870-1 General.
* * * * *
(d) For additional information on production rights, data, and
information; services provided by Canadian Commercial Corporation;
audit; and inspection, see PGI 225.870-1(d).
12. Section 225.870-5 is revised to read as follows:
[[Page 14627]]
225.870-5 Contract administration.
Follow the contract administration procedures at PGI 225.870-5.
13. Section 225.870-7 is revised to read as follows:
225.870-7 Acceptance of Canadian supplies.
For information on the acceptance of Canadian supplies, see PGI
225.870-7.
14. Section 225.871 is revised to read as follows:
225.871 North Atlantic Treaty Organization (NATO) cooperative
projects.
15. Section 225.871-1 is revised to read as follows:
225.871-1 Scope.
This section implements 22 U.S.C. 2767 and 10 U.S.C. 2350b.
16. Section 225.871-5 is amended by revising paragraph (b) and
removing paragraph (c). The revised text reads as follows:
225.871-5 Directed subcontracting.
* * * * *
(b) In some instances, it may not be feasible to name specific
subcontractors at the time the agreement is concluded. However, the
agreement shall clearly state the general provisions for work sharing
at the prime and subcontract level. For additional information on
cooperative project agreements, see PGI 225.871-5.
17. Section 225.871-6 is revised to read as follows:
225.871-6 Disposal of property.
Dispose of property that is jointly acquired by the members of a
cooperative project under the procedures established in the agreement
or in a manner consistent with the terms of the agreement, without
regard to any laws of the United States applicable to the disposal of
property owned by the United States.
18. Section 225.872-4 is revised to read as follows:
225.872-4 Individual determinations.
If the offer of an end product from a qualifying country source
listed in 225.872-1(b), as evaluated, is low or otherwise eligible for
award, prepare a determination and findings exempting the acquisition
from the Buy American Act and the Balance of Payments Program as
inconsistent with the public interest, unless another exception such as
the Trade Agreements Act applies. Follow the procedures at PGI 225.872-
4.
19. Section 225.872-5 is amended by revising paragraphs (b) and (c)
and by removing paragraph (d). The revised text reads as follows:
225.872-5 Contract administration.
* * * * *
(b) Follow the contract administration procedures at PGI 225.872-
5(b).
(c) Information on quality assurance delegations to foreign
governments is in subpart 246.4, Government Contract Quality Assurance.
20. Section 225.872-6 is amended by revising paragraph (c) to read
as follows:
225.872-6 Audit.
* * * * *
(c) Handle requests for audits in qualifying countries in
accordance with 215.404-2(c), but follow the additional procedures at
PGI 225.872-6(c).
21. Section 225.873-2 is revised to read as follows:
225.873-2 Procedures.
When an offeror or a contractor identifies a levy included in an
offered or contract price, follow the procedures at PGI 225.873-2.
22. Sections 225.902 and 225.903 are revised to read as follows:
225.902 Procedures.
Follow the entry and release procedures at PGI 225.902.
225.903 Exempted supplies.
(b)(i) For an explanation of the term ``supplies,'' see PGI
225.903(b)(i).
(ii) The duty-free certificate shall be printed, stamped, or typed
on the face of, or attached to, Customs Form 7501. A duly designated
officer or civilian official of the appropriate department or agency
shall execute the certificate in the format provided at PGI
225.903(a)(ii).
23. Section 225.7003 is amended in paragraph (a) by revising the
introductory text to read as follows:
225.7003 Waiver of restrictions of 10 U.S.C. 2534.
(a) The waiver procedures of this section apply only if
specifically authorized by reference elsewhere in this subpart. The
restrictions on certain foreign purchases under 10 U.S.C. 2534(a) may
be waived as follows:
* * * * *
24. Sections 225.7301 and 225.7302 are revised to read as follows:
225.7301 General.
(a) The U.S. Government sells defense articles and services to
foreign governments or international organizations through FMS
agreements. The agreement is documented in a Letter of Offer and
Acceptance (LOA) (see DoD 5105.38-M, Security Assistance Management
Manual).
(b) Conduct FMS acquisitions under the same acquisition and
contract management procedures used for other defense acquisitions.
(c) Follow the additional procedures at PGI 225.7301(c) for
preparation of solicitations and contracts that include FMS
requirements.
225.7302 Guidance.
For guidance on the role of the contracting officer in FMS programs
that will require an acquisition, see PGI 225.7302.
25. Section 225.7303-2 is amended in paragraph (a)(3) by revising
the introductory text to read as follows:
225.7303-2 Cost of doing business with a foreign government or an
international organization.
(a) * * *
(3) Offset costs (also see 225.7307).
* * * * *
225.7303-4 [Amended]
26. Section 225.7303-4 is amended in paragraph (b)(1) by revising
the last parenthetical to read ``(see 225.7307(a))'.
225.7306 [Removed]
27. Section 225.7306 is removed.
225.7307 and 225.7308 [Redesignated]
28. Sections 225.7307 and 225.7308 are redesignated as sections
225.7306 and 225.7307, respectively.
29. Newly designated section 225.7306 is revised to read as
follows:
225.7306 Offset arrangements.
In accordance with the Presidential policy statement of April 16,
1990, DoD does not encourage, enter into, or commit U.S. firms to FMS
offset arrangements. The decision whether to engage in offsets, and the
responsibility for negotiating and implementing offset arrangements,
resides with the companies involved. (Also see 225.7303-2(a)(3)).
30. Section 225.7501 is amended by revising paragraph (a)(2)(iii)
to read as follows:
225.7501 Policy.
* * * * *
(a) * * *
(2) * * *
(iii) A spare part for foreign-manufactured vehicles, equipment,
machinery, or systems, provided the acquisition is restricted to the
original manufacturer or its supplier;
* * * * *
[[Page 14628]]
PART 252--SOLICITATION PROVISIONS AND CONTRACT CLAUSES
252.225-7027 and 252.225-7028 [Amended]
31. Sections 252.225-7027 and 252.225-7028 are amended in the
introductory text by removing ``225.7308'' and adding in its place
``225.7307''.
[FR Doc. 05-5625 Filed 3-22-05; 8:45 am]
BILLING CODE 5001-08-P