Federal Acquisition Regulation; Use of Commercial Services Item Authority, 14568-14569 [2011-5557]

Agencies

• DEPARTMENT OF DEFENSE
• General Services Administration
• National Aeronautics and Space Administration

[Federal Register Volume 76, Number 51 (Wednesday, March 16, 2011)]
[Rules and Regulations]
[Pages 14568-14569]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-5557]


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DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Part 15

[FAC 2005-50; FAR Case 2008-034; Item VI; Docket 2009-0035, Sequence 1]
RIN 9000-AL44


Federal Acquisition Regulation; Use of Commercial Services Item 
Authority

AGENCIES: Department of Defense (DoD), General Services Administration 
(GSA), and National Aeronautics and Space Administration (NASA).

ACTION: Final rule.

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SUMMARY: DoD, GSA, and NASA have adopted as final, without change, an 
interim rule amending the Federal Acquisition Regulation (FAR) to 
implement section 868 of the Duncan Hunter National Defense 
Authorization Act for Fiscal Year 2009. Section 868 provides that the 
FAR shall be amended with respect to the procurement of commercial 
services, specifically services that are not offered and sold 
competitively in substantial quantities in the commercial marketplace, 
but are of a type offered and sold competitively in substantial 
quantities in the commercial marketplace. These services may be 
considered commercial items only if the contracting officer has 
determined in writing that the offeror has submitted sufficient 
information to evaluate, through price analysis, the reasonableness of 
the price for such services. The rule details the information the 
contracting officer may consider in order to make this determination.

DATES: Effective Date: March 16, 2011.

FOR FURTHER INFORMATION CONTACT: Mr. Edward N. Chambers, Procurement 
Analyst, at (202) 501-3221 for clarification of content. For 
information pertaining to status or publication schedules, contact the 
Regulatory Secretariat at (202) 501-4755. Please cite FAC 2005-50, FAR 
Case 2008-034.

SUPPLEMENTARY INFORMATION:

I. Background

    DoD, GSA, and NASA published an interim rule in the Federal 
Register at 74 FR 52852 on October 14, 2009, to implement section 868 
of the Duncan Hunter National Defense Authorization Act for Fiscal Year 
2009. The comment period closed on December 14, 2009.

[[Page 14569]]

Four respondents submitted comments on the interim rule.

II. Discussion/Analysis

    The analysis of public comments by the Defense Acquisition 
Regulations Council and the Civilian Agency Acquisition Council (the 
Councils) follows:

A. Agree With the Rule

    Comment: One respondent agreed with the interim rule. The 
respondent believes including ``services of a type'' provides the 
Government with flexibility to access a wide variety of services with 
beneficial contracting methods.
    Response: The Councils acknowledge the respondent's agreement with 
the interim rule.

B. ``Services of a Type''

    Comment: One respondent suggests adding a definition for ``services 
of a type'' and/or providing examples of ``services of a type.''
    Response: The Councils do not agree that definitions or examples 
are necessary to implement this case. The FAR definition of a 
``commercial item'' adequately addresses what is and is not a 
commercial item. The contracting officer's determination that a service 
is considered a ``service of a type'' is a determination made based on 
the circumstances surrounding a particular acquisition and is made on a 
case-by-case basis.

C. Sold in the Commercial Marketplace

    Comment: One respondent also suggests qualifying the two references 
to the ``commercial marketplace'' in FAR 15.403-1(c)(3)(ii)(A) as 
follows. The first reference would be followed by ``by the offeror,'' 
while the second reference would be followed by ``by others than the 
offeror.''
    Response: The respondent's suggested language changes go beyond the 
statute.

D. Establishing Price Reasonableness

    1. Determination that the offeror has submitted sufficient 
information (15.403-1(c)(3)(ii)(A)).
    Comment: One respondent suggests that requiring a contracting 
officer determination that the offeror has submitted sufficient 
information to evaluate the reasonableness of the offered price will 
increase the contracting officer's workload, may result in lengthy and 
unnecessary delays, and could reduce competition.
    Response: The determination is required by statute.
    2. Other relevant information (15.403-1(c)(3)(ii)(C)).
    Comment: One respondent believes that if a service is ``of a type'' 
sold in the commercial market place, but price reasonableness cannot be 
established, then that service would not benefit from the Truth in 
Negotiations Act exception for commercial items, and that such an 
outcome would cause tremendous confusion among contracting officers and 
potential offerors of commercial items.
    Response: If price reasonableness cannot be determined based on 
prices for similar commercial services, the services ``of a type'' 
cannot be determined to be commercial items (see 15.403-
1(c)(3)(ii)(A)). In that case, the contracting officer would need to 
determine price reasonableness by requesting relevant cost or pricing 
data from the contractor.
    Comment: One respondent suggests that the requirement to provide 
cost information other than cost or pricing data could prove difficult 
for industry vendors, which may diminish the field of vendors.
    Response: Current FAR 15.402 policy requires that the contracting 
officer determine price reasonableness. This cost information can come 
in many forms (sales data, vendor quotations, historical data, etc.) 
and is usually on hand for a contractor. Consequently, providing this 
cost information will not present a burden sufficient to discourage 
industry vendors from seeking Government contracts.
    Comment: One respondent believes that if the contracting officer 
can request cost data, this additional work could result in significant 
delays in contract award, contract delivery schedule problems and 
higher prices.
    Response: The Councils acknowledge the respondent's concern; 
however, the contracting officer is required to request appropriate 
cost or pricing data sufficient to determine price reasonableness.

E. Location of Coverage

    Comment: One respondent suggested that this FAR change should be in 
FAR 15.403-3 in lieu of 15.403-1.
    Response: The Councils believe the language belongs in FAR 15.403-
1, since it is more closely aligned with the prohibition on obtaining 
cost or pricing data than the FAR section requiring information other 
than cost or pricing data. It is noted that these two sections 
complement each other and are often used congruently.

III. Executive Order 12866

    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.

IV. 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 does not 
impose any additional requirements on small businesses. This rule 
impacts the Government by requiring a new written determination by the 
contracting officer. The rule details the information the contracting 
officer may consider in order to make this determination. In addition, 
since the current FAR 15.403-3(a)(1) provides for contracting officers 
to obtain the relevant information necessary to determine price 
reasonableness, this final rule places no additional requirements on 
contractors.

V. Paperwork Reduction Act

    The Paperwork Reduction Act (44 U.S.C. chapter 35) does apply; 
however these changes to the FAR do not impose additional information 
collection requirements to the paperwork burden previously approved 
under OMB Control Number 9000-0013, titled: Cost or Pricing Data 
Exemption.

List of Subjects in 48 CFR Part 15

    Government procurement.

    Dated: March 4, 2011.
Millisa Gary,
Acting Director, Office of Governmentwide Acquisition Policy.

Interim Rule Adopted as Final Without Change

0
Accordingly, the interim rule amending 48 CFR part 15, which was 
published in the Federal Register at 74 FR 52852 on October 14, 2009, 
is adopted as a final rule without change.

[FR Doc. 2011-5557 Filed 3-15-11; 8:45 am]
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