Federal Acquisition Regulation; FAR Case 2005-022, Exception to the Buy American Act for Commercial Information Technology, 57378-57379 [06-8217]
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57378
Federal Register / Vol. 71, No. 188 / Thursday, September 28, 2006 / Rules and Regulations
using solicitation provision 52.225–18,
Place of Manufacture (and its
commercial item equivalent in 52.212–
3, Offeror Representations and
Certifications–Commercial Items). For
purposes of this report, the criteria
established in the law is only whether
the place of manufacture of an end
product is in the United States or
outside the United States, without
regard to the origin of the components
(see 25.001(c)).
I 4. Amend section 25.1101 by adding
paragraph (f) to read as follows:
25.1101
Acquisition of supplies.
*
*
*
*
*
(f) Insert the provision at 52.225–18,
Place of Manufacture, in solicitations
that are predominantly for the
acquisition of manufactured end
products, as defined in the provision at
52.225–18 (i.e., the estimated value of
the manufactured end products exceeds
the estimated value of other items to be
acquired as a result of the solicitation).
PART 52—SOLICITATION PROVISIONS
AND CONTRACT CLAUSES
5. Amend section 52.212–3 by—
a. Revising the date of the provision;
I b. Amending the introductory
paragraph of the provision by removing
from the first sentence ‘‘paragraph (j)’’
and adding ‘‘paragraph (k)’’ in its place;
and by removing from the second
sentence ‘‘paragraphs (b) through (i)’’
and adding ‘‘paragraphs (b) through (j)’’
in its place;
I c. Amending paragraph (a) by
removing from the end of the
introductory paragraph the colon and
adding an em dash in its place; and by
adding in alphabetical order, the
definitions ‘‘Manufactured end
product’’ and ‘‘Place of manufacture’’;
I d. Redesignating paragraph ‘‘j’’ as
paragraph ‘‘k’’; and adding new
paragraph ‘‘j’’;
I e. In the newly designated paragraph
(k)(1), removing ‘‘paragraph (j)’’ and
adding ‘‘paragraph (k)(2)’’ in its place;
and
I f. In the newly designated paragraph
(k)(2), in the bracketed paragraph,
removing ‘‘(b) through (i)’’ and adding
‘‘(b) through (j)’’ in its place.
The revised text reads as follows:
I
I
jlentini on PROD1PC65 with RULES2
52.212–3 Offeror Representations and
Certifications—Commercial Items.
*
*
*
*
*
OFFEROR REPRESENTATIONS AND
CERTIFICATIONS–COMMERCIAL ITEMS
(SEP 2006)
*
*
*
(a) * * *
VerDate Aug<31>2005
*
*
20:02 Sep 27, 2006
Jkt 208001
Manufactured end product means any
end product in Federal Supply Classes
(FSC) 1000–9999, except—
(1) FSC 5510, Lumber and Related
Basic Wood Materials;
(2) Federal Supply Group (FSG) 87,
Agricultural Supplies;
(3) FSG 88, Live Animals;
(4) FSG 89, Food and Related
Consumables;
(5) FSC 9410, Crude Grades of Plant
Materials;
(6) FSC 9430, Miscellaneous Crude
Animal Products, Inedible;
(7) FSC 9440, Miscellaneous Crude
Agricultural and Forestry Products;
(8) FSC 9610, Ores;
(9) FSC 9620, Minerals, Natural and
Synthetic; and
(10) FSC 9630, Additive Metal
Materials.
Place of manufacture means the place
where an end product is assembled out
of components, or otherwise made or
processed from raw materials into the
finished product that is to be provided
to the Government. If a product is
disassembled and reassembled, the
place of reassembly is not the place of
manufacture.
*
*
*
*
*
(j) Place of manufacture. (Does not
apply unless the solicitation is
predominantly for the acquisition of
manufactured end products.) For
statistical purposes only, the offeror
shall indicate whether the place of
manufacture of the end products it
expects to provide in response to this
solicitation is predominantly—
(1) b In the United States (Check this
box if the total anticipated price of
offered end products manufactured in
the United States exceeds the total
anticipated price of offered end
products manufactured outside the
United States); or
(2) b Outside the United States.
*
*
*
*
*
(End of provision)
I 6. Add section 52.225–18 to read as
follows:
52.225–18
Place of Manufacture.
As prescribed in 25.1101(f), insert the
following solicitation provision:
I
PLACE OF MANUFACTURE (SEP 2006)
(a) Definitions. As used in this
clause—
Manufactured end product means any
end product in Federal Supply Classes
(FSC) 1000–9999, except—
(1) FSC 5510, Lumber and Related
Basic Wood Materials;
(2) Federal Supply Group (FSG) 87,
Agricultural Supplies;
(3) FSG 88, Live Animals;
(4) FSG 89, Food and Related
Consumables;
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Fmt 4701
Sfmt 4700
(5) FSC 9410, Crude Grades of Plant
Materials;
(6) FSC 9430, Miscellaneous Crude
Animal Products, Inedible;
(7) FSC 9440, Miscellaneous Crude
Agricultural and Forestry Products;
(8) FSC 9610, Ores;
(9) FSC 9620, Minerals, Natural and
Synthetic; and
(10) FSC 9630, Additive Metal
Materials.
Place of manufacture means the place
where an end product is assembled out
of components, or otherwise made or
processed from raw materials into the
finished product that is to be provided
to the Government. If a product is
disassembled and reassembled, the
place of reassembly is not the place of
manufacture.
(b) For statistical purposes only, the
offeror shall indicate whether the place
of manufacture of the end products it
expects to provide in response to this
solicitation is predominantly—
(1) b In the United States (Check this
box if the total anticipated price of
offered end products manufactured in
the United States exceeds the total
anticipated price of offered end
products manufactured outside the
United States); or
(2) b Outside the United States.
(End of provision)
[FR Doc. 06–8208 Filed 9–27–06; 8:45 am]
BILLING CODE 6820–EP–S
DEPARTMENT OF DEFENSE
GENERAL SERVICES
ADMINISTRATION
NATIONAL AERONAUTICS AND
SPACE ADMINISTRATION
48 CFR Part 25
[FAC 2005–13; FAR Case 2005–022; Item
VII;Docket 2006–0020, Sequence 14]
RIN 9000–AK34
Federal Acquisition Regulation; FAR
Case 2005–022, Exception to the Buy
American Act for Commercial
Information Technology
Department of Defense (DoD),
General Services Administration (GSA),
and National Aeronautics and Space
Administration (NASA).
ACTION: Final rule.
AGENCIES:
SUMMARY: The Civilian Agency
Acquisition Council and the Defense
Acquisition Regulations Council
(Councils) have agreed to convert to a
final rule without change, an interim
rule amending the Federal Acquisition
E:\FR\FM\28SER2.SGM
28SER2
Federal Register / Vol. 71, No. 188 / Thursday, September 28, 2006 / Rules and Regulations
Regulation (FAR) to implement Section
535(a) of Division F of the Consolidated
Appropriations Act, 2004, and similar
sections in subsequent appropriations
acts. Section 535(a) authorizes an
exception to the Buy American Act for
acquisitions of information technology
that are commercial items.
DATES: Effective Date: September 28,
2006.
FOR FURTHER INFORMATION CONTACT For
clarification of content, contact Mr.
Jeremy Olson, at (202) 501–3221. Please
cite FAC 2005–13, FAR case 2005–022.
For information pertaining to status or
publication schedules, contact the FAR
Secretariat at (202) 501–4755.
SUPPLEMENTARY INFORMATION:
A. Background
This final rule amends the Federal
Acquisition Regulation to implement
annual appropriations act provisions
that exempt acquisitions of information
technology that are commercial items
from the Buy American Act, including—
• Section 535(a) of Division F,
Consolidated Appropriations Act, 2004
(Pub. L. 108–199);
• Section 517 of Division H, Title V
of the Consolidated Appropriations Act,
2005 (Pub. L. 108–447); and
• Section 717 of Division A,
Transportation, Treasury, Housing and
Urban Development, the Judiciary, the
District of Columbia, and Independent
Agencies Appropriations Act, 2006
(Pub. L. 109–115).
This exception was initially
implemented through deviations by the
individual agencies, until it became
clear that it was not just for one year.
The Councils now expect this exception
to continue to appear in future
appropriations acts. If the exception
does not appear in a future
appropriations act, the Councils will
promptly change the FAR to limit
applicability of the exception to the
fiscal years to which it applies. DoD,
GSA, and NASA published an interim
rule in the Federal Register at 71 FR
223, January 3, 2006 and the public
comment period closed on March 6,
2006.
Public comments. The Councils
addressed the two public comments as
follows:
jlentini on PROD1PC65 with RULES2
Agree with rule
One respondent concurs with the rule
as written. The respondent views this
rule as a positive first step in
recognizing the Government’s need for
quicker, cheaper access to commercialoff-the-shelf information technology.
Response: None required.
VerDate Aug<31>2005
20:02 Sep 27, 2006
Jkt 208001
Rule should not apply to DoD
The other respondent believes that the
exception should not apply to DoD due
to the security risk associated with
foreign entities potentially gaining
access to DoD information systems.
Response: This rule implements
statute. The statutes that the Councils
are implementing do not exempt DoD.
Each fiscal year statute states that the
restrictions of the Buy American Act
shall not apply to the acquisition by the
Federal Government of information
technology that is a commercial item.
Although DoD uses DoD-unique Buy
American Act/Free Trade Agreement
provisions and clauses, this exception
has already been implemented by DoD
for Fiscal Years 2004 through 2006 by
class deviations signed by the Director
of Defense Procurement and Acquisition
Policy (2004–O0003, 2005–O0004,
2005–O0010).
Regardless of the applicability of the
Buy American Act, Defense FAR
Supplement (DFARS) Subpart 239.71,
Security and Privacy for Computer
Systems, requires defense agencies to
ensure that information assurance is
provided for information technology in
accordance with current policies,
procedures, and statutes.
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 Regulatory Flexibility Act, 5
U.S.C. 601, et seq., applies to this final
rule. The Councils prepared a Final
Regulatory Flexibility Analysis (FRFA),
and it is summarized as follows:
The objective of this rule is to promote
Government access to commercial
information technology. As a result of this
exception, the Buy American Act will no
longer apply to acquisitions of commercial
information technology. The Free Trade
Agreement non-discriminatory provisions are
no longer necessary, since all products will
be treated without the restrictions of the Buy
American Act. The final rule applies to all
offerors responding to solicitations for
commercial information technology where
the Buy American Act previously applied
(generally, acquisitions between the micropurchase threshold and $193,000). This
impact analysis does not include the
Department of Defense, which applies this
exception to DoD-unique Buy American Act/
Free Trade Agreement provisions and clauses
under a separate case (DFARS Case 2005–
D011). This exception will allow small
entities to compete without meeting the Buy
American Act domestic end product
requirements.
PO 00000
Frm 00025
Fmt 4701
Sfmt 4700
57379
It is anticipated that small business
concerns will continue to receive the same
number of awards in the range of the micropurchase threshold to $100,000, because
these awards are generally set-aside for small
business concerns. It is also expected that
small business concerns will continue to
receive awards in the range of $100,000 to
$193,000, but in this range they will face
competition from foreign end products.
This rule will not have an effect on small
businesses affected by the ‘‘non-manufacturer
rule,’’ which means that a contractor under
a small business set-aside or 8(a) contract
shall be a small business under the
applicable size standard and shall provide
either its own product or that of another
domestic small business manufacturing or
processing concern. If there is a small
business set-aside, and there is no SBA
waiver of the nonmanufacturer rule, then
FAR 52.219–6(c) and/or FAR 52.219–18(d)
require that a domestic product must be
furnished. In this case, the rule will have no
effect on small businesses because the
nonmanufacturer rule is not changed. If SBA
did waive the nonmanufacturer rule, then
there is no requirement to purchase a
domestic product but an evaluation
preference would apply. The rule could have
an impact on small businesses when there is
no small business set-aside because small
businesses may lose the evaluation
preference for acquisitions between $25,000
and $193,000.
Interested parties may obtain a copy
of the FRFA from the FAR Secretariat.
The FAR Secretariat has submitted a
copy of the FRFA to the Chief Counsel
for Advocacy of the Small Business
Administration.
C. Paperwork Reduction Act
The Paperwork Reduction Act does
apply because the changes to the FAR
will slightly reduce the information
collection requirements currently
approved by the Office of Management
and Budget OMB Clearances 9000–0024
and 9000–0130. We estimate a reduction
of approximately 300 hours to OMB
Clearance 9000–0024 and 50 hours to
9000–0130.
List of Subjects in 48 CFR Part 25
Government procurement.
Dated: September 19, 2006.
Ralph De Stefano,
Director, Contract Policy Division.
Interim Rule Adopted as Final Without
Change
Accordingly, the interim rule
amending 48 CFR part 25, which was
published in the Federal Register at 71
FR 223, January 3, 2006, is adopted as
a final rule without change.
I
[FR Doc. 06–8217 Filed 9–27–06; 8:45 am]
BILLING CODE 6820–EP–S
E:\FR\FM\28SER2.SGM
28SER2
]]>Agencies
[Federal Register Volume 71, Number 188 (Thursday, September 28, 2006)]
[Rules and Regulations]
[Pages 57378-57379]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 06-8217]
-----------------------------------------------------------------------
DEPARTMENT OF DEFENSE
GENERAL SERVICES ADMINISTRATION
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
48 CFR Part 25
[FAC 2005-13; FAR Case 2005-022; Item VII;Docket 2006-0020, Sequence
14]
RIN 9000-AK34
Federal Acquisition Regulation; FAR Case 2005-022, Exception to
the Buy American Act for Commercial Information Technology
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 to convert to a
final rule without change, an interim rule amending the Federal
Acquisition
[[Page 57379]]
Regulation (FAR) to implement Section 535(a) of Division F of the
Consolidated Appropriations Act, 2004, and similar sections in
subsequent appropriations acts. Section 535(a) authorizes an exception
to the Buy American Act for acquisitions of information technology that
are commercial items.
DATES: Effective Date: September 28, 2006.
FOR FURTHER INFORMATION CONTACT For clarification of content, contact
Mr. Jeremy Olson, at (202) 501-3221. Please cite FAC 2005-13, FAR case
2005-022. For information pertaining to status or publication
schedules, contact the FAR Secretariat at (202) 501-4755.
SUPPLEMENTARY INFORMATION:
A. Background
This final rule amends the Federal Acquisition Regulation to
implement annual appropriations act provisions that exempt acquisitions
of information technology that are commercial items from the Buy
American Act, including--
Section 535(a) of Division F, Consolidated Appropriations
Act, 2004 (Pub. L. 108-199);
Section 517 of Division H, Title V of the Consolidated
Appropriations Act, 2005 (Pub. L. 108-447); and
Section 717 of Division A, Transportation, Treasury,
Housing and Urban Development, the Judiciary, the District of Columbia,
and Independent Agencies Appropriations Act, 2006 (Pub. L. 109-115).
This exception was initially implemented through deviations by the
individual agencies, until it became clear that it was not just for one
year. The Councils now expect this exception to continue to appear in
future appropriations acts. If the exception does not appear in a
future appropriations act, the Councils will promptly change the FAR to
limit applicability of the exception to the fiscal years to which it
applies. DoD, GSA, and NASA published an interim rule in the Federal
Register at 71 FR 223, January 3, 2006 and the public comment period
closed on March 6, 2006.
Public comments. The Councils addressed the two public comments as
follows:
Agree with rule
One respondent concurs with the rule as written. The respondent
views this rule as a positive first step in recognizing the
Government's need for quicker, cheaper access to commercial-off-the-
shelf information technology.
Response: None required.
Rule should not apply to DoD
The other respondent believes that the exception should not apply
to DoD due to the security risk associated with foreign entities
potentially gaining access to DoD information systems.
Response: This rule implements statute. The statutes that the
Councils are implementing do not exempt DoD. Each fiscal year statute
states that the restrictions of the Buy American Act shall not apply to
the acquisition by the Federal Government of information technology
that is a commercial item.
Although DoD uses DoD-unique Buy American Act/Free Trade Agreement
provisions and clauses, this exception has already been implemented by
DoD for Fiscal Years 2004 through 2006 by class deviations signed by
the Director of Defense Procurement and Acquisition Policy (2004-O0003,
2005-O0004, 2005-O0010).
Regardless of the applicability of the Buy American Act, Defense
FAR Supplement (DFARS) Subpart 239.71, Security and Privacy for
Computer Systems, requires defense agencies to ensure that information
assurance is provided for information technology in accordance with
current policies, procedures, and statutes.
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 Regulatory Flexibility Act, 5 U.S.C. 601, et seq., applies to
this final rule. The Councils prepared a Final Regulatory Flexibility
Analysis (FRFA), and it is summarized as follows:
The objective of this rule is to promote Government access to
commercial information technology. As a result of this exception,
the Buy American Act will no longer apply to acquisitions of
commercial information technology. The Free Trade Agreement non-
discriminatory provisions are no longer necessary, since all
products will be treated without the restrictions of the Buy
American Act. The final rule applies to all offerors responding to
solicitations for commercial information technology where the Buy
American Act previously applied (generally, acquisitions between the
micro-purchase threshold and $193,000). This impact analysis does
not include the Department of Defense, which applies this exception
to DoD-unique Buy American Act/Free Trade Agreement provisions and
clauses under a separate case (DFARS Case 2005-D011). This exception
will allow small entities to compete without meeting the Buy
American Act domestic end product requirements.
It is anticipated that small business concerns will continue to
receive the same number of awards in the range of the micro-purchase
threshold to $100,000, because these awards are generally set-aside
for small business concerns. It is also expected that small business
concerns will continue to receive awards in the range of $100,000 to
$193,000, but in this range they will face competition from foreign
end products.
This rule will not have an effect on small businesses affected
by the ``non-manufacturer rule,'' which means that a contractor
under a small business set-aside or 8(a) contract shall be a small
business under the applicable size standard and shall provide either
its own product or that of another domestic small business
manufacturing or processing concern. If there is a small business
set-aside, and there is no SBA waiver of the nonmanufacturer rule,
then FAR 52.219-6(c) and/or FAR 52.219-18(d) require that a domestic
product must be furnished. In this case, the rule will have no
effect on small businesses because the nonmanufacturer rule is not
changed. If SBA did waive the nonmanufacturer rule, then there is no
requirement to purchase a domestic product but an evaluation
preference would apply. The rule could have an impact on small
businesses when there is no small business set-aside because small
businesses may lose the evaluation preference for acquisitions
between $25,000 and $193,000.
Interested parties may obtain a copy of the FRFA from the FAR
Secretariat. The FAR Secretariat has submitted a copy of the FRFA to
the Chief Counsel for Advocacy of the Small Business Administration.
C. Paperwork Reduction Act
The Paperwork Reduction Act does apply because the changes to the
FAR will slightly reduce the information collection requirements
currently approved by the Office of Management and Budget OMB
Clearances 9000-0024 and 9000-0130. We estimate a reduction of
approximately 300 hours to OMB Clearance 9000-0024 and 50 hours to
9000-0130.
List of Subjects in 48 CFR Part 25
Government procurement.
Dated: September 19, 2006.
Ralph De Stefano,
Director, Contract Policy Division.
Interim Rule Adopted as Final Without Change
0
Accordingly, the interim rule amending 48 CFR part 25, which was
published in the Federal Register at 71 FR 223, January 3, 2006, is
adopted as a final rule without change.
[FR Doc. 06-8217 Filed 9-27-06; 8:45 am]
BILLING CODE 6820-EP-S
