Defense Federal Acquisition Regulation Supplement; Representation Relating to Compensation of Former DoD Officials (DFARS Case 2010-D020), 32846-32849 [2011-13365]
Download as PDF
32846
Federal Register / Vol. 76, No. 108 / Monday, June 6, 2011 / Proposed Rules
List of Subjects in 48 CFR Part 252
Government procurement.
Ynette R. Shelkin,
Editor, Defense Acquisition Regulations
System.
Therefore, 48 CFR part 252 is
proposed to be amended as follows:
PART 252—SOLICITATION
PROVISIONS AND CONTRACT
CLAUSES
1. The authority citation for 48 CFR
part 252 continues to read as follows:
Authority: 41 U.S.C. 1303 and 48 CFR
chapter 1.
2. Amend section 252.212–7001 by
revising the clause date, and paragraphs
(b)(5)(i), (b)(11)(i), (b)(14)(i), (b)(20), and
(b)(21) to read as as follows:
252.212–7001 Contract terms and
conditions required to implement statutes
or executive orders applicable to defense
acquisitions of commercial items.
*
*
*
*
*
CONTRACT TERMS AND
CONDITIONS REQUIRED TO
IMPLEMENT STATUTES OR
EXECUTIVE ORDERS APPLICABLE TO
DEFENSE ACQUISITIONS OF
COMMERCIAL ITEMS (DATE)
*
*
*
*
*
(b) * * *
(5)(i)____252.225–7001, Buy American Act
and Balance of Payments Program (DATE)
(41 U.S.C. chapter 83, E.O. 10582).
*
*
*
*
*
(11)(i)____252.225–7021, Trade
Agreements (DATE) (19 U.S.C. 2501–2518
and 19 U.S.C. 3301 note)
*
*
*
*
*
(14)(i)____ 252.225–7036, Buy American
Act—Free Trade Agreements—Balance of
Payments Program (DATE) (41 U.S.C. chapter
83 and 19 U.S.C. 3301 note)
*
*
*
*
*
(20)____252.237–7010, Prohibition on
Interrogation of Detainees by Contractor
Personnel (NOV 2010) (Section 1038 of Pub.
L. 111–84).
(21)____252.237–7019, Training for
Contractor Personnel Interacting with
Detainees (SEP 2006) (Section 1092 of Public
Law 108–375).
mstockstill on DSK4VPTVN1PROD with PROPOSALS3
*
*
*
*
*
3. Amend section 252.225–7001 by
revising the clause date, paragraph
(a)(8), and paragraph (b) to read as
follows:
*
*
*
*
*
*
*
*
*
(b) This clause implements the Buy
American Act (41 U.S.C. chapter 83). In
accordance with 41 U.S.C. 1907, the
component test of the Buy American Act is
waived for an end product that is a COTS
item (see section 12.505(a)(1) of the Federal
Acquisition Regulation). Unless otherwise
specified, this clause applies to all line items
in the contract.
*
*
*
*
*
4. Amend section 252.225–7021 by
revising the clause date and paragraph
(a)(10) to read as follows:
252.225–7021
*
*
*
Trade agreements.
*
*
TRADE AGREEMENTS (DATE)
(a) * * *
(10) Qualifying country end product
means—
(i) An unmanufactured end product mined
or produced in a qualifying country; or
(ii) An end product manufactured in a
qualifying country if—
(A) The cost of the following types of
components exceeds 50 percent of the cost of
all its components:
(1) Components mined, produced, or
manufactured in a qualifying country.
(2) Components mined, produced, or
manufactured in the United States.
(3) Components of foreign origin of a class
or kind for which the Government has
determined that sufficient and reasonably
available commercial quantities of a
satisfactory quality are not mined, produced,
or manufactured in the United States; or
(B) The end product is a COTS item.
*
*
*
*
*
5. Amend section 252.225–7036 by
revising the clause date and paragraph
(a)(13) to read as follows:
*
*
BUY AMERICAN ACT AND BALANCE
OF PAYMENTS PROGRAM (DATE)
*
*
*
*
BUY AMERICAN ACT—FREE TRADE
AGREEMENTS—BALANCE OF
PAYMENTS PROGRAM (DATE)
(a) * * *
(a) * * *
VerDate Mar<15>2010
(13) Qualifying country end product
means—
(i) An unmanufactured end product mined
or produced in a qualifying country; or
(ii) An end product manufactured in a
qualifying country if—
(A) The cost of the following types of
components exceeds 50 percent of the cost of
all its components:
(1) Components mined, produced, or
manufactured in a qualifying country.
(2) Components mined, produced, or
manufactured in the United States.
(3) Components of foreign origin of a class
or kind for which the Government has
determined that sufficient and reasonably
available commercial quantities of a
satisfactory quality are not mined, produced,
or manufactured in the United States; or
(B) The end product is a COTS item.
252.225–7036 Buy American Act—Free
Trade Agreements—Balance of Payments
Program.
252.225–7001 Buy American Act and
Balance of Payments Program.
*
(8) Qualifying country end product
means—
(i) An unmanufactured end product mined
or produced in a qualifying country; or
(ii) An end product manufactured in a
qualifying country if—
(A) The cost of the following types of
components exceeds 50 percent of the cost of
all its components:
(1) Components mined, produced, or
manufactured in a qualifying country.
(2) Components mined, produced, or
manufactured in the United States.
(3) Components of foreign origin of a class
or kind for which the Government has
determined that sufficient and reasonably
available commercial quantities of a
satisfactory quality are not mined, produced,
or manufactured in the United States; or
(B) The end product is a COTS item.
17:39 Jun 03, 2011
Jkt 223001
PO 00000
Frm 00002
Fmt 4701
Sfmt 4702
*
*
*
*
[FR Doc. 2011–13367 Filed 6–3–11; 8:45 am]
BILLING CODE 5001–08–P
DEPARTMENT OF DEFENSE
Defense Acquisition Regulations
System
48 CFR Parts 203, 204, and 252
RIN 0750–AG99
Defense Federal Acquisition
Regulation Supplement;
Representation Relating to
Compensation of Former DoD Officials
(DFARS Case 2010–D020)
Defense Acquisition
Regulations System; Department of
Defense (DoD).
ACTION: Proposed rule.
AGENCY:
DoD is proposing to amend
the Defense Federal Acquisition
Regulation Supplement (DFARS) to
require that offerors represent whether
former DoD officials employed by the
offeror are in compliance with postemployment restrictions.
DATES: Comments on the proposed rule
should be submitted in writing to the
address shown below on or before
August 5, 2011, to be considered in the
formation of the final rule.
ADDRESSES: Submit comments
identified by DFARS Case 2010–D020,
using any of the following methods:
Æ Regulations.gov: https://
www.regulations.gov.
Submit comments via the Federal
eRulemaking portal by inputting
‘‘DFARS Case 2010–D020’’ under the
heading ‘‘Enter keyword or ID’’ and
selecting ‘‘Search.’’ Select the link
‘‘Submit a Comment’’ that corresponds
with ‘‘DFARS Case 2010–D020.’’ Follow
the instructions provided at the ‘‘Submit
a Comment’’ screen. Please include your
name, company name (if any), and
SUMMARY:
E:\FR\FM\06JNP3.SGM
06JNP3
Federal Register / Vol. 76, No. 108 / Monday, June 6, 2011 / Proposed Rules
‘‘DFARS Case 2010–D020’’ on your
attached document.
Æ E-mail: dfars@osd.mil. Include
DFARS Case 2010–D020 in the subject
line of the message.
Æ Fax: 703–602–0350.
Æ Mail: Defense Acquisition
Regulations System, Attn: Ms. Meredith
Murphy, OUSD (AT&L) DPAP/DARS,
Room 3B855, 3060 Defense Pentagon,
Washington, DC 20301–3060.
Comments received generally will be
posted without change to https://
www.regulations.gov, including any
personal information provided. To
confirm receipt of your comment(s),
please check https://www.regulations.gov
approximately two to three days after
submission to verify posting (except
allow 30 days for posting of comments
submitted by mail).
FOR FURTHER INFORMATION CONTACT: Ms.
Meredith Murphy, Defense Acquisition
Regulations System, OUSD (AT&L)
DPAP/DARS, 3060 Defense Pentagon,
Room 3B855, Washington, DC 20301–
3060. Telephone 703–602–1302;
facsimile 703–602–0350. Please cite
DFARS Case 2010–D020.
SUPPLEMENTARY INFORMATION:
substantial interest to the former agency
for one year after leaving Federal
service.
2. 41 U.S.C. 2104 (Formerly, 41 U.S.C.
423)
DoD and other Government
acquisition officials may not accept
compensation from a defense contractor
during a one year cooling-off period if
the official performed certain duties at
DoD involving the contractor and a
contract valued in excess of $10 million.
However, the individual may accept
employment from a division or affiliate
that does not produce the same or
similar items.
3. Section 847 of the National Defense
Authorization Act (NDAA) for Fiscal
Year (FY) 2008
I. Background
Section 847 requires that senior DoD
officials who have been personally and
substantially involved in contracts over
$10 million request a written postemployment ethics opinion before
receiving compensation from a
contractor. It also applies to the
employees who are affected by the oneyear compensation ban of 41 U.S.C.
2104.
A. Statutory Requirements
B. Current Acquisition Regulations
The principal statutory restrictions
concerning post-government
employment for DoD and other Federal
employees after leaving Government
employment are found in 18 U.S.C. 207
and 41 U.S.C. 2104 (formerly, 41 U.S.C.
423), and 5 CFR parts 2637 and 2641.
mstockstill on DSK4VPTVN1PROD with PROPOSALS3
1. 18 U.S.C. 207
18 U.S.C. 207 prohibits an individual
from representing a contractor to their
former agency on particular matters
involving specific parties that they
handled while working for the Federal
Government for defined cooling-off
periods that vary according to the
former official’s involvement and
position:
a. Former personnel are permanently
barred from representing their new
employer to their former agencies for
matters on which they were personally
and substantially involved.
b. Even if the former officials were not
directly involved in the matter, former
personnel may not represent their new
employer to their former agency on
matters that were pending under their
official responsibility in their last year
of service for two years after leaving
Federal service.
c. Former senior-level officers and
employees may not contact their former
agency on particular government
matters that are pending or are of
VerDate Mar<15>2010
17:39 Jun 03, 2011
Jkt 223001
1. FAR 3.104 implements 41 U.S.C
2104 and 18 U.S.C. 207.
2. DFARS 203.104 implements
procurement integrity for DoD.
3. DFARS 203.171–3 is an
implementation of section 847 of the
NDAA for FY 2008. Pursuant to DFARS
203.171–3, defense contractors may not
knowingly provide compensation to
‘‘covered DoD officials’’ (as defined by a
January 2009 DFARS Clause 252.203–
7000, Requirements Relating to
Compensation of Former DoD Officials)
who left Government employment on or
after January 28, 2008, unless the
contractor first determines that the
former employee has received, or has
requested at least 30 days prior to
receiving compensation from the
contractor, the post-employment ethics
opinion regarding post-employment
restrictions. DFARS 252.203–7000
incorporates this prohibition of
knowingly compensating former DoD
‘‘covered officials,’’ into DoD contracts.
The DFARS does not require additional
action from the DoD contractor or
covered employee in the event that the
covered employee has not received an
opinion on post-employment
restrictions. In addition, the clause does
not cover DoD employees who left the
Government prior to January 28, 2008.
PO 00000
Frm 00003
Fmt 4701
Sfmt 4702
32847
C. General Accountability Office (GAO)
Study GAO–08–485
Congress included a provision in the
National Defense Authorization Act for
Fiscal Year 2007 (Pub. L. 109–364,
section 851) requiring GAO to report on
recent employment of former DoD
Officials by major defense contractors.
In May 2008, the GAO issued a report,
‘‘Defense Contracting: Post-Government
Employment of Former DoD Officials
Needs Greater Transparency’’ (GAO–08–
485). GAO auditors focused on 52 major
defense contractors.
The GAO found that contractors
under-reported the employment of
former DoD officials to the extent that
they employed almost twice as many
they reported.
GAO estimated that approximately
422 former DoD officials (postGovernment employment) were working
on defense contracts under the
responsibility of their former agency. At
least nine of those individuals could
have been performing services under the
same contract for which they had prior
program responsibility. GAO concluded
that the results of the study indicated
that defense contractors may employ a
substantial number of former DoD
officials on assignments related to their
former positions.
According to GAO, DoD does not have
a mechanism for monitoring former
senior officials and acquisition officials
when they begin their new jobs with
defense contractors. DoD’s practice of
providing written ethics opinions to
senior and acquisition officials who
request them provides only limited
transparency, although DoD is in the
process of implementing a single
database for collecting and retaining this
information.
The GAO report showed that major
defense contractors are not currently
ensuring that former DoD senior
officials and acquisition executives
working on contracts are in compliance
with post-employment restrictions.
GAO concluded that greater
transparency is needed by DoD with
respect to former senior and acquisition
executives (i.e., DoD ‘‘covered officials’’)
to ensure compliance with applicable
post-employment restrictions.
D. Proposed Rule
The proposed provision will remedy
this deficiency by requiring offerors to
submit representations at the time of
contract award that all former DoD
officials that are covered by the
Procurement Integrity Act are in
compliance with post-employment
restrictions set forth in DFARS 203.171–
3 and DFARS 252.203–7000. The
E:\FR\FM\06JNP3.SGM
06JNP3
32848
Federal Register / Vol. 76, No. 108 / Monday, June 6, 2011 / Proposed Rules
representation goes further in also
requiring a representation that former
DoD employees employed by the
contractor are also in compliance with
additional post-employment restrictions
of 18 U.S.C. 207 and 5 CFR parts 2637
and 2631, including FAR 3.104–2.
This representation will be required
in contracts for commercial items. This
representation is an enforcement
mechanism for DFARS clause 252.203–
7000, which is required in contracts for
commercial items (see 252.212–
7001(b)(1)). Therefore, the
representation has been added to
252.212–7000.
mstockstill on DSK4VPTVN1PROD with PROPOSALS3
II. Executive Orders 12866 and 13563
Executive Orders (E.O.s) 12866 and
13563 direct agencies to assess all costs
and benefits of available regulatory
alternatives and, if regulation is
necessary, to select regulatory
approaches that maximize net benefits
(including potential economic,
environmental, public health and safety
effects, distributive impacts, and
equity). E.O. 13563 emphasizes the
importance of quantifying both costs
and benefits, of reducing costs, of
harmonizing rules, and of promoting
flexibility. This is not a significant
regulatory action and, therefore, was not
subject to review under Section 6(b) of
E.O. 12866, Regulatory Planning and
Review, dated September 30, 1993. This
rule is not a major rule under 5 U.S.C.
804.
III. Regulatory Flexibility Act
DoD does not expect this proposed
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. Nevertheless, an initial
regulatory flexibility analysis has been
prepared, and is summarized as follows:
This proposed rule is in response to
a study by the General Accountability
Office, ‘‘Defense Contracting: PostGovernment Employment of Former
DoD Officials Needs Greater
Transparency’’ (GAO–08–485), issued in
May 2008. The GAO found that
contractors under-reported the
employment of former DoD officials to
the extent that they employed almost
twice as many as they reported. The
GAO report showed that major defense
contractors are not currently ensuring
that former DoD senior officials and
acquisition executives working on
contracts are in compliance with postemployment restrictions.
The objective of the proposed rule is
to remedy this deficiency reported by
the GAO by requiring offerors to submit
representations at the time of contract
VerDate Mar<15>2010
17:39 Jun 03, 2011
Jkt 223001
award that all former DoD officials that
are covered by the Procurement
Integrity Act are in compliance with
post-employment restrictions set forth
in DFARS 203.171–3 and DFARS
252.203–7000, as required by section
847 of the National Defense
Authorization Act for Fiscal Year 2008.
The representation goes further in also
requiring a representation that former
DoD employees employed by the
contractor are also in compliance with
additional post-employment restrictions
of 18 U.S.C. 207 and 5 CFR parts 2637
and 2631, including FAR 3.104–2.
The rule requires a representation
from all offerors that respond to a DoD
solicitation. However, the
representation will only require
preparatory effort if the offeror employs
or otherwise provides compensation to
former DoD officials covered by the
Procurement Integrity Act. There is no
impact on the offeror unless the former
DoD officials covered by the
Procurement Integrity Act are not in
compliance with the post-employment
restrictions. A covered DoD official is
already defined in the clause at DFARS
252.203–7000, Requirements Relating to
Compensation of Former DoD
Employees. In the period of 2001–2006,
1.85 million former military and civilian
personnel left DoD service. A ‘‘covered
DoD official’’ only includes former DoD
officials holding certain positions and
who left within the past two years. The
GAO found that the 1.85 million
personnel who had left DoD service over
a six-year period included only 35,192
who had served in the type of senior or
acquisition official positions that made
them subject to post-government
employment restrictions, if they were
subsequently hired by defense
contractors. Dividing by 35,192 (to
reduce the six-year period to a two-year
period), we estimate that 11,730 of those
officials would have left within the last
two years. We estimate that 7,635 of
these former officials may accept
employment with a defense contractor
(about 65 percent). The GAO study
found 2,435 of these covered officials
employed by 52 major defense
contractors. Of the remaining 5,200
former officials covered by the
Procurement Integrity Act, we estimate
that 3,900 (75 percent) of them may
work for small business concerns.
There is no information collection
requirement associated with this
proposed rule. Offerors make the
representation by submission of an
offer. They are not allowed to submit an
offer if they can not make the
representation. In order to submit an
offer, small entities that hire a former
DoD official covered by the Procurement
PO 00000
Frm 00004
Fmt 4701
Sfmt 4702
Integrity Act will have to check the
compliance of such employees with
various applicable post-employment
restrictions. DFARS 252.203–7000,
Requirements Relating to Compensation
of Former DoD Officials, already
requires contractors to determine that a
covered DoD official has sought and
received, or has not received after 30
days of seeking, a written opinion from
the appropriate DoD ethics counselor,
regarding the applicability of postemployment restrictions to the activities
that the official is expected to undertake
on behalf of the contractor. Therefore,
this representation of compliance does
not impose an additional burden on the
offeror.
The rule does not duplicate, overlap,
or conflict with any other Federal rules.
There are no known significant
alternatives to the rule that would
achieve the objectives of the rule.
DoD invites comments from small
business concerns and other interested
parties on the expected impact of this
rule on small entities.
DoD will also consider comments
from small entities concerning the
existing regulations in subparts affected
by the rule in accordance with 5 U.S.C.
610. Interested parties must submit such
comments separately and should cite 5
U.S.C. 610 (DFARS Case 2010–D020) in
correspondence.
IV. Paperwork Reduction Act
The rule does not impose any new
information collection requirements that
require the approval of the Office of
Management and Budget under the
Paperwork Reduction Act (44 U.S.C.
chapter 35).
List of Subjects in 48 CFR Parts 203 and
252
Government procurement.
Ynette R. Shelkin,
Editor, Defense Acquisition Regulations
System.
Therefore, 48 CFR parts 203, 204, and
252 are proposed to be amended as
follows:
1. The authority citation for 48 CFR
parts 203, 204, and 252 continues to
read as follows:
Authority: 41 U.S.C. 1303 and 48 CFR
chapter 1.
PART 203—IMPROPER BUSINESS
PRACTICES AND PERSONAL
CONFLICTS OF INTEREST
2. Revise section 203.171–4 to read as
follows:
E:\FR\FM\06JNP3.SGM
06JNP3
32849
Federal Register / Vol. 76, No. 108 / Monday, June 6, 2011 / Proposed Rules
203.171–4 Solicitation provisions and
contract clause.
(a) Use the clause at 252.203–7000,
Requirements Relating to Compensation
of Former DoD Officials, in all
solicitations and contracts.
(b) Use the provision at 252.203–
70XX, Representation Relating to
Compensation of Former DoD Officials,
in all solicitations.
PART 204—ADMINISTRATIVE
MATTERS
3. Amend section 204.1202 by
redesignating paragraphs (2)(i) through
(xii) as paragraphs (2)(ii) through (xiii)
and adding new paragraph (2)(i) to read
as follows,
204.1202 Solicitation provision and
contract clause.
*
*
*
*
(2) * * *
(i) 252.203–70XX, Representation
Relating to Compensation of Former
DoD Officials.
*
*
*
*
*
252.212–7000 Offeror Representations and
Certifications—Commercial Items.
PART 252—SOLICITATION
PROVISIONS AND CONTRACT
CLAUSES
*
4. Add section 252.203–70XX to read
as follows:
252.203–70XX Representation Relating to
Compensation of Former DoD Officials.
mstockstill on DSK4VPTVN1PROD with PROPOSALS3
As prescribed in 203.171–4(b), insert
the following provision:
17:39 Jun 03, 2011
Jkt 223001
(a) Definition. Covered DoD official is
defined in the clause at 252.203–7000,
Requirements Relating to Compensation of
Former DoD Officials.
(b) By submission of this offer, the offeror
represents, to the best of its knowledge and
belief, that all covered DoD officials
employed by or otherwise receiving
compensation from the offeror are presently
in compliance with—
(1) Defense Federal Acquisition Regulation
Supplement (DFARS) 203.171–3 and DFARS
252.203–7000; and
(2) Other post-employment restrictions
covered by 18 U.S.C. 207 and 5 CFR parts
2637 and 2631, including Federal
Acquisition Regulation 3.104–2.
(End of provision)
5. Amend section 252.212–7000 by
revising the clause date, revising
paragraph (a), and adding paragraph (d)
to read as follows:
*
VerDate Mar<15>2010
REPRESENTATION RELATING TO
COMPENSATION OF FORMER DOD
OFFICIALS (DATE)
*
*
*
*
OFFEROR REPRESENTATIONS AND
CERTIFICATIONS—COMMERCIAL ITEMS
(JUN 2011)
(a) Definitions. As used in this clause—
Covered DoD official is defined in the
clause at 252.203–7000, Requirements
Relating to Compensation of Former DoD
Officials. Foreign person means any person
other than a United States person as defined
PO 00000
Frm 00005
Fmt 4701
Sfmt 9990
in Section 16(2) of the Export Administration
Act of 1979 (50 U.S.C. App. Sec. 2415).
United States means the 50 States, the
District of Columbia, outlying areas, and the
outer Continental Shelf as defined in 43
U.S.C. 1331.
United States person is defined in section
16(2) of the Export Administration Act of
1979 and means any United States resident
or national (other than an individual resident
outside the United States and employed by
other than a United States person), any
domestic concern (including any permanent
domestic establishment of any foreign
concern), and any foreign subsidiary or
affiliate (including any permanent foreign
establishment) of any domestic concern
which is controlled in fact by such domestic
concern, as determined under regulations of
the President.
*
*
*
*
*
(d) Representation Relating to
Compensation of Former DoD Officials. By
submission of this offer, the offeror
represents, to the best of its knowledge and
belief, that all covered DoD officials
employed by or otherwise receiving
compensation from the offeror, are presently
in compliance with—
(1) Defense Federal Acquisition Regulation
Supplement (DFARS) 203.171–3 and DFARS
252.203–7000, Requirements Relating to
Compensation of Former DoD Officials; and
(2) Other post-employment restrictions
covered by 18 U.S.C. 207 and 5 CFR parts
2637 and 2631, including Federal
Acquisition Regulation 3.104–2.
(End of provision)
[FR Doc. 2011–13365 Filed 6–3–11; 8:45 am]
BILLING CODE 5001–08–P
E:\FR\FM\06JNP3.SGM
06JNP3
Agencies
[Federal Register Volume 76, Number 108 (Monday, June 6, 2011)]
[Proposed Rules]
[Pages 32846-32849]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-13365]
-----------------------------------------------------------------------
DEPARTMENT OF DEFENSE
Defense Acquisition Regulations System
48 CFR Parts 203, 204, and 252
RIN 0750-AG99
Defense Federal Acquisition Regulation Supplement; Representation
Relating to Compensation of Former DoD Officials (DFARS Case 2010-D020)
AGENCY: Defense Acquisition Regulations System; Department of Defense
(DoD).
ACTION: Proposed rule.
-----------------------------------------------------------------------
SUMMARY: DoD is proposing to amend the Defense Federal Acquisition
Regulation Supplement (DFARS) to require that offerors represent
whether former DoD officials employed by the offeror are in compliance
with post-employment restrictions.
DATES: Comments on the proposed rule should be submitted in writing to
the address shown below on or before August 5, 2011, to be considered
in the formation of the final rule.
ADDRESSES: Submit comments identified by DFARS Case 2010-D020, using
any of the following methods:
[cir] Regulations.gov: https://www.regulations.gov.
Submit comments via the Federal eRulemaking portal by inputting
``DFARS Case 2010-D020'' under the heading ``Enter keyword or ID'' and
selecting ``Search.'' Select the link ``Submit a Comment'' that
corresponds with ``DFARS Case 2010-D020.'' Follow the instructions
provided at the ``Submit a Comment'' screen. Please include your name,
company name (if any), and
[[Page 32847]]
``DFARS Case 2010-D020'' on your attached document.
[cir] E-mail: dfars@osd.mil. Include DFARS Case 2010-D020 in the
subject line of the message.
[cir] Fax: 703-602-0350.
[cir] Mail: Defense Acquisition Regulations System, Attn: Ms.
Meredith Murphy, OUSD (AT&L) DPAP/DARS, Room 3B855, 3060 Defense
Pentagon, Washington, DC 20301-3060.
Comments received generally will be posted without change to https://www.regulations.gov, including any personal information provided. To
confirm receipt of your comment(s), please check https://www.regulations.gov approximately two to three days after submission to
verify posting (except allow 30 days for posting of comments submitted
by mail).
FOR FURTHER INFORMATION CONTACT: Ms. Meredith Murphy, Defense
Acquisition Regulations System, OUSD (AT&L) DPAP/DARS, 3060 Defense
Pentagon, Room 3B855, Washington, DC 20301-3060. Telephone 703-602-
1302; facsimile 703-602-0350. Please cite DFARS Case 2010-D020.
SUPPLEMENTARY INFORMATION:
I. Background
A. Statutory Requirements
The principal statutory restrictions concerning post-government
employment for DoD and other Federal employees after leaving Government
employment are found in 18 U.S.C. 207 and 41 U.S.C. 2104 (formerly, 41
U.S.C. 423), and 5 CFR parts 2637 and 2641.
1. 18 U.S.C. 207
18 U.S.C. 207 prohibits an individual from representing a
contractor to their former agency on particular matters involving
specific parties that they handled while working for the Federal
Government for defined cooling-off periods that vary according to the
former official's involvement and position:
a. Former personnel are permanently barred from representing their
new employer to their former agencies for matters on which they were
personally and substantially involved.
b. Even if the former officials were not directly involved in the
matter, former personnel may not represent their new employer to their
former agency on matters that were pending under their official
responsibility in their last year of service for two years after
leaving Federal service.
c. Former senior-level officers and employees may not contact their
former agency on particular government matters that are pending or are
of substantial interest to the former agency for one year after leaving
Federal service.
2. 41 U.S.C. 2104 (Formerly, 41 U.S.C. 423)
DoD and other Government acquisition officials may not accept
compensation from a defense contractor during a one year cooling-off
period if the official performed certain duties at DoD involving the
contractor and a contract valued in excess of $10 million. However, the
individual may accept employment from a division or affiliate that does
not produce the same or similar items.
3. Section 847 of the National Defense Authorization Act (NDAA) for
Fiscal Year (FY) 2008
Section 847 requires that senior DoD officials who have been
personally and substantially involved in contracts over $10 million
request a written post-employment ethics opinion before receiving
compensation from a contractor. It also applies to the employees who
are affected by the one-year compensation ban of 41 U.S.C. 2104.
B. Current Acquisition Regulations
1. FAR 3.104 implements 41 U.S.C 2104 and 18 U.S.C. 207.
2. DFARS 203.104 implements procurement integrity for DoD.
3. DFARS 203.171-3 is an implementation of section 847 of the NDAA
for FY 2008. Pursuant to DFARS 203.171-3, defense contractors may not
knowingly provide compensation to ``covered DoD officials'' (as defined
by a January 2009 DFARS Clause 252.203-7000, Requirements Relating to
Compensation of Former DoD Officials) who left Government employment on
or after January 28, 2008, unless the contractor first determines that
the former employee has received, or has requested at least 30 days
prior to receiving compensation from the contractor, the post-
employment ethics opinion regarding post-employment restrictions. DFARS
252.203-7000 incorporates this prohibition of knowingly compensating
former DoD ``covered officials,'' into DoD contracts. The DFARS does
not require additional action from the DoD contractor or covered
employee in the event that the covered employee has not received an
opinion on post-employment restrictions. In addition, the clause does
not cover DoD employees who left the Government prior to January 28,
2008.
C. General Accountability Office (GAO) Study GAO-08-485
Congress included a provision in the National Defense Authorization
Act for Fiscal Year 2007 (Pub. L. 109-364, section 851) requiring GAO
to report on recent employment of former DoD Officials by major defense
contractors. In May 2008, the GAO issued a report, ``Defense
Contracting: Post-Government Employment of Former DoD Officials Needs
Greater Transparency'' (GAO-08-485). GAO auditors focused on 52 major
defense contractors.
The GAO found that contractors under-reported the employment of
former DoD officials to the extent that they employed almost twice as
many they reported.
GAO estimated that approximately 422 former DoD officials (post-
Government employment) were working on defense contracts under the
responsibility of their former agency. At least nine of those
individuals could have been performing services under the same contract
for which they had prior program responsibility. GAO concluded that the
results of the study indicated that defense contractors may employ a
substantial number of former DoD officials on assignments related to
their former positions.
According to GAO, DoD does not have a mechanism for monitoring
former senior officials and acquisition officials when they begin their
new jobs with defense contractors. DoD's practice of providing written
ethics opinions to senior and acquisition officials who request them
provides only limited transparency, although DoD is in the process of
implementing a single database for collecting and retaining this
information.
The GAO report showed that major defense contractors are not
currently ensuring that former DoD senior officials and acquisition
executives working on contracts are in compliance with post-employment
restrictions. GAO concluded that greater transparency is needed by DoD
with respect to former senior and acquisition executives (i.e., DoD
``covered officials'') to ensure compliance with applicable post-
employment restrictions.
D. Proposed Rule
The proposed provision will remedy this deficiency by requiring
offerors to submit representations at the time of contract award that
all former DoD officials that are covered by the Procurement Integrity
Act are in compliance with post-employment restrictions set forth in
DFARS 203.171-3 and DFARS 252.203-7000. The
[[Page 32848]]
representation goes further in also requiring a representation that
former DoD employees employed by the contractor are also in compliance
with additional post-employment restrictions of 18 U.S.C. 207 and 5 CFR
parts 2637 and 2631, including FAR 3.104-2.
This representation will be required in contracts for commercial
items. This representation is an enforcement mechanism for DFARS clause
252.203-7000, which is required in contracts for commercial items (see
252.212-7001(b)(1)). Therefore, the representation has been added to
252.212-7000.
II. Executive Orders 12866 and 13563
Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess
all costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits (including potential economic, environmental, public
health and safety effects, distributive impacts, and equity). E.O.
13563 emphasizes the importance of quantifying both costs and benefits,
of reducing costs, of harmonizing rules, and of promoting flexibility.
This is not a significant regulatory action and, therefore, was not
subject to review under Section 6(b) of E.O. 12866, Regulatory Planning
and Review, dated September 30, 1993. This rule is not a major rule
under 5 U.S.C. 804.
III. Regulatory Flexibility Act
DoD does not expect this proposed 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.
Nevertheless, an initial regulatory flexibility analysis has been
prepared, and is summarized as follows:
This proposed rule is in response to a study by the General
Accountability Office, ``Defense Contracting: Post-Government
Employment of Former DoD Officials Needs Greater Transparency'' (GAO-
08-485), issued in May 2008. The GAO found that contractors under-
reported the employment of former DoD officials to the extent that they
employed almost twice as many as they reported. The GAO report showed
that major defense contractors are not currently ensuring that former
DoD senior officials and acquisition executives working on contracts
are in compliance with post-employment restrictions.
The objective of the proposed rule is to remedy this deficiency
reported by the GAO by requiring offerors to submit representations at
the time of contract award that all former DoD officials that are
covered by the Procurement Integrity Act are in compliance with post-
employment restrictions set forth in DFARS 203.171-3 and DFARS 252.203-
7000, as required by section 847 of the National Defense Authorization
Act for Fiscal Year 2008. The representation goes further in also
requiring a representation that former DoD employees employed by the
contractor are also in compliance with additional post-employment
restrictions of 18 U.S.C. 207 and 5 CFR parts 2637 and 2631, including
FAR 3.104-2.
The rule requires a representation from all offerors that respond
to a DoD solicitation. However, the representation will only require
preparatory effort if the offeror employs or otherwise provides
compensation to former DoD officials covered by the Procurement
Integrity Act. There is no impact on the offeror unless the former DoD
officials covered by the Procurement Integrity Act are not in
compliance with the post-employment restrictions. A covered DoD
official is already defined in the clause at DFARS 252.203-7000,
Requirements Relating to Compensation of Former DoD Employees. In the
period of 2001-2006, 1.85 million former military and civilian
personnel left DoD service. A ``covered DoD official'' only includes
former DoD officials holding certain positions and who left within the
past two years. The GAO found that the 1.85 million personnel who had
left DoD service over a six-year period included only 35,192 who had
served in the type of senior or acquisition official positions that
made them subject to post-government employment restrictions, if they
were subsequently hired by defense contractors. Dividing by 35,192 (to
reduce the six-year period to a two-year period), we estimate that
11,730 of those officials would have left within the last two years. We
estimate that 7,635 of these former officials may accept employment
with a defense contractor (about 65 percent). The GAO study found 2,435
of these covered officials employed by 52 major defense contractors. Of
the remaining 5,200 former officials covered by the Procurement
Integrity Act, we estimate that 3,900 (75 percent) of them may work for
small business concerns.
There is no information collection requirement associated with this
proposed rule. Offerors make the representation by submission of an
offer. They are not allowed to submit an offer if they can not make the
representation. In order to submit an offer, small entities that hire a
former DoD official covered by the Procurement Integrity Act will have
to check the compliance of such employees with various applicable post-
employment restrictions. DFARS 252.203-7000, Requirements Relating to
Compensation of Former DoD Officials, already requires contractors to
determine that a covered DoD official has sought and received, or has
not received after 30 days of seeking, a written opinion from the
appropriate DoD ethics counselor, regarding the applicability of post-
employment restrictions to the activities that the official is expected
to undertake on behalf of the contractor. Therefore, this
representation of compliance does not impose an additional burden on
the offeror.
The rule does not duplicate, overlap, or conflict with any other
Federal rules.
There are no known significant alternatives to the rule that would
achieve the objectives of the rule.
DoD invites comments from small business concerns and other
interested parties on the expected impact of this rule on small
entities.
DoD will also consider comments from small entities concerning the
existing regulations in subparts affected by the rule in accordance
with 5 U.S.C. 610. Interested parties must submit such comments
separately and should cite 5 U.S.C. 610 (DFARS Case 2010-D020) in
correspondence.
IV. Paperwork Reduction Act
The rule does not impose any new information collection
requirements that require the approval of the Office of Management and
Budget under the Paperwork Reduction Act (44 U.S.C. chapter 35).
List of Subjects in 48 CFR Parts 203 and 252
Government procurement.
Ynette R. Shelkin,
Editor, Defense Acquisition Regulations System.
Therefore, 48 CFR parts 203, 204, and 252 are proposed to be
amended as follows:
1. The authority citation for 48 CFR parts 203, 204, and 252
continues to read as follows:
Authority: 41 U.S.C. 1303 and 48 CFR chapter 1.
PART 203--IMPROPER BUSINESS PRACTICES AND PERSONAL CONFLICTS OF
INTEREST
2. Revise section 203.171-4 to read as follows:
[[Page 32849]]
203.171-4 Solicitation provisions and contract clause.
(a) Use the clause at 252.203-7000, Requirements Relating to
Compensation of Former DoD Officials, in all solicitations and
contracts.
(b) Use the provision at 252.203-70XX, Representation Relating to
Compensation of Former DoD Officials, in all solicitations.
PART 204--ADMINISTRATIVE MATTERS
3. Amend section 204.1202 by redesignating paragraphs (2)(i)
through (xii) as paragraphs (2)(ii) through (xiii) and adding new
paragraph (2)(i) to read as follows,
204.1202 Solicitation provision and contract clause.
* * * * *
(2) * * *
(i) 252.203-70XX, Representation Relating to Compensation of Former
DoD Officials.
* * * * *
PART 252--SOLICITATION PROVISIONS AND CONTRACT CLAUSES
4. Add section 252.203-70XX to read as follows:
252.203-70XX Representation Relating to Compensation of Former DoD
Officials.
As prescribed in 203.171-4(b), insert the following provision:
REPRESENTATION RELATING TO COMPENSATION OF FORMER DOD OFFICIALS (DATE)
(a) Definition. Covered DoD official is defined in the clause at
252.203-7000, Requirements Relating to Compensation of Former DoD
Officials.
(b) By submission of this offer, the offeror represents, to the
best of its knowledge and belief, that all covered DoD officials
employed by or otherwise receiving compensation from the offeror are
presently in compliance with--
(1) Defense Federal Acquisition Regulation Supplement (DFARS)
203.171-3 and DFARS 252.203-7000; and
(2) Other post-employment restrictions covered by 18 U.S.C. 207
and 5 CFR parts 2637 and 2631, including Federal Acquisition
Regulation 3.104-2.
(End of provision)
5. Amend section 252.212-7000 by revising the clause date, revising
paragraph (a), and adding paragraph (d) to read as follows:
252.212-7000 Offeror Representations and Certifications--Commercial
Items.
* * * * *
OFFEROR REPRESENTATIONS AND CERTIFICATIONS--COMMERCIAL ITEMS (JUN 2011)
(a) Definitions. As used in this clause--
Covered DoD official is defined in the clause at 252.203-7000,
Requirements Relating to Compensation of Former DoD Officials.
Foreign person means any person other than a United States person as
defined in Section 16(2) of the Export Administration Act of 1979
(50 U.S.C. App. Sec. 2415).
United States means the 50 States, the District of Columbia,
outlying areas, and the outer Continental Shelf as defined in 43
U.S.C. 1331.
United States person is defined in section 16(2) of the Export
Administration Act of 1979 and means any United States resident or
national (other than an individual resident outside the United
States and employed by other than a United States person), any
domestic concern (including any permanent domestic establishment of
any foreign concern), and any foreign subsidiary or affiliate
(including any permanent foreign establishment) of any domestic
concern which is controlled in fact by such domestic concern, as
determined under regulations of the President.
* * * * *
(d) Representation Relating to Compensation of Former DoD
Officials. By submission of this offer, the offeror represents, to
the best of its knowledge and belief, that all covered DoD officials
employed by or otherwise receiving compensation from the offeror,
are presently in compliance with--
(1) Defense Federal Acquisition Regulation Supplement (DFARS)
203.171-3 and DFARS 252.203-7000, Requirements Relating to
Compensation of Former DoD Officials; and
(2) Other post-employment restrictions covered by 18 U.S.C. 207
and 5 CFR parts 2637 and 2631, including Federal Acquisition
Regulation 3.104-2.
(End of provision)
[FR Doc. 2011-13365 Filed 6-3-11; 8:45 am]
BILLING CODE 5001-08-P