Federal Acquisition Regulation; United States-Korea Free Trade Agreement, 56739-56740 [2012-22574]
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Federal Register / Vol. 77, No. 178 / Thursday, September 13, 2012 / Rules and Regulations
$202,000. The threshold for the Korea
FTA for construction is the same as the
threshold for the WTO GPA for
construction.
DEPARTMENT OF DEFENSE
GENERAL SERVICES
ADMINISTRATION
II. Discussion and Analysis
NATIONAL AERONAUTICS AND
SPACE ADMINISTRATION
The Civilian Agency Acquisition
Council and the Defense Acquisition
Regulations Council (the Councils)
reviewed the comments in the
development of the final rule. A
discussion of the comments is provided
as follows:
48 CFR Parts 4, 25 and 52
[FAC 2005–61; FAR Case 2012–004; Item
I; Docket 2012–0004, Sequence 1]
RIN 9000–AM18
Federal Acquisition Regulation; United
States-Korea Free Trade Agreement
Department of Defense (DoD),
General Services Administration (GSA),
and National Aeronautics and Space
Administration (NASA).
ACTION: Final rule.
AGENCY:
DoD, GSA, and NASA are
adopting as final, without change, an
interim rule amending the Federal
Acquisition Regulation (FAR) to
implement the United States-Korea Free
Trade Agreement. The Republic of
Korea is already party to the World
Trade Organization Government
Procurement Agreement, but this trade
agreement implements a lower
procurement threshold.
DATES: Effective Date: September 13,
2012.
FOR FURTHER INFORMATION CONTACT: Ms.
Cecelia L. Davis, Procurement Analyst,
at 202–219–0202 for clarification of
content. For information pertaining to
status or publication schedules, contact
the Regulatory Secretariat at 202–501–
4755. Please cite FAC 2005–61, FAR
Case 2012–004.
SUPPLEMENTARY INFORMATION:
mstockstill on DSK4VPTVN1PROD with RULES3
SUMMARY:
I. Background
DoD, GSA, and NASA published an
interim rule in the Federal Register on
March 7, 2012 (77 FR 13952), to
implement the Free Trade Agreement
with the Republic of Korea, which took
effect on March 15, 2012. The comment
period closed on May 7, 2012. Three
respondents submitted comments on the
interim rule.
The interim rule added the Republic
of Korea to the definition of ‘‘Free Trade
Agreement country’’ in multiple
locations in the FAR. The Republic of
Korea was already listed as a designated
country because it is party to the WTO
GPA. The excluded services for the
Korea FTA are the same as for the WTO
GPA. By implementation of this Korea
FTA, eligible goods and services from
Korea are now covered when valued at
or above $100,000, rather than at or
above the WTO GPA threshold of
VerDate Mar<15>2010
19:34 Sep 12, 2012
Jkt 226001
A. Summary of Significant Changes
The Councils have adopted the
interim rule as final without change.
B. Analysis of Public Comments
1. Impact on U.S. Businesses and
Economy
Comment: One respondent expressed
agreement that the United States has the
responsibility to do business with Free
Trade Agreement countries, but was
concerned that lowering the trade
agreements threshold from $202,000 to
$100,000 for goods and services from
the Republic of Korea will damage the
small American business owners’
chances to compete, because of lower
minimum wage in Korea. The
respondent was also concerned that
lowering the threshold will increase the
national deficit. This respondent also
stated that the rule will benefit U.S. big
business owners to the detriment of
small American business owners.
Response: DoD, GSA, and NASA
issued this final rule because it
implements a statute (United StatesKorea Free Trade Agreement
Implementation Act, Pub. L. 112–41,
enacted on October 21, 2011). The
Councils do not have discretion to set
trade agreement thresholds.
However, as discussed in the section
on Regulatory Flexibility, the lowering
of the threshold from $202,000 to
$100,0000 only applies to the supplies
and services covered by the Korea Free
Trade Agreement. For DoD, it only
covers the non-defense items listed at
Defense Federal Acquisition Regulations
System (DFARS) 225.401–70.
Acquisitions that are set aside or
provide other form of preference for
small businesses are exempt from the
Korea Free Trade Agreement. FAR
19.502–2 states that acquisitions that do
not exceed $150,000 (except as
described in paragraph (1) of the
definition of ‘‘simplified acquisition
threshold’’ at 2.101) are automatically
reserved exclusively for small business
concerns, unless the contracting officer
determines that there is not a reasonable
expectation of obtaining offers from two
PO 00000
Frm 00003
Fmt 4701
Sfmt 4700
56739
or more responsible small business
concerns.
2. Implementation in Contracts for
Services
Comment: One respondent questioned
how agencies will implement the Korea
Free Trade Agreement for services.
Response: This question is not unique
to the Korea Free Trade Agreement. The
FAR does not provide provisions or
clauses for the specific implementation
of any trade agreements. The FAR
provisions and clauses address only end
products, because the provisions and
clauses are necessary to—
• Waive the Buy American Act,
which only applies to supplies; and
• Implement the purchase restriction
at 25.403(c) for acquisitions that exceed
the World Trade Organization
Government Procurement Agreement
(WTO GPA) threshold of $202,000.
Below that threshold, there is no
purchase restriction on acquisition of
services from nondesignated countries.
The requirements of the Free Trade
Agreements relate primarily to
acquisition procedures that are already
specified in the FAR, e.g., FAR 5.203,
Publicizing and response time; FAR
5.207, Preparation and transmittal of
synopses; and FAR 15.503, Notifications
to unsuccessful offerors (see FAR 25.408
for other applicable procedures).
3. Procuring Entities of the Central Level
of the U.S. Government
Comment: One respondent requested
that the final rule should include the list
of the entities of the U.S. central level
of Government, which have certain
obligations with respect to Government
procurement of goods and services.
Response: The FAR has not included
the list of Federal entities subject to any
other free trade agreement or the WTO
GPA. Therefore, the Councils do not
consider inclusion of such a list in the
FAR for the Korea Free Trade
Agreement to be necessary or
appropriate.
4. Past Performance
Comment: One respondent expressed
appreciation of the specific reference to
Article 17.5.2(b) of the Korea Free Trade
Agreement in the Federal Register
preamble to the interim rule. Article
17.5.2.(b) stipulates that an agency shall
not impose a condition that, in order for
an offeror to be allowed to submit an
offer or be awarded a contract, the
offeror has been previously awarded one
or more contracts by an agency of the
United States Government or that the
offeror has prior work experience in the
United States. The respondent suggested
that Office of Management and Budget
E:\FR\FM\13SER3.SGM
13SER3
56740
Federal Register / Vol. 77, No. 178 / Thursday, September 13, 2012 / Rules and Regulations
guidance on ‘‘best practices for
collecting and using current and past
performance information’’ be updated
by adding best practices related to
Articles 17.5.2(b) of the Korea Free
Trade Agreement.
Response: Changes to the Office of
Management and Budget guidance are
outside the scope of this rule. The
Councils note, however, that FAR
15.305(a)(2)(iv) already requires that, in
the case of an offeror without a record
of relevant past performance or for
whom information on past performance
is not available, the offeror may not be
evaluated favorably or unfavorably on
past performance.
mstockstill on DSK4VPTVN1PROD with RULES3
III. 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 a significant
regulatory action and, therefore, was
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.
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 Korea
is already a designated country under
the WTO GPA. Although the rule opens
up Government procurement to the
goods and services of Korea at or above
the threshold of $100,000, the
Department of Defense only applies the
trade agreements to the non-defense
items listed at DFARS 225.401–70, and
acquisitions that are set aside or provide
other form of preference for small
businesses are exempt from coverage of
the agreement. FAR 19.502–2 states that
acquisitions that do not exceed
$150,000 (except as described in
paragraph (1) of the definition of
‘‘simplified acquisition threshold’’ at
2.101) are automatically reserved
exclusively for small business concerns,
unless the contracting officer
VerDate Mar<15>2010
19:34 Sep 12, 2012
Jkt 226001
determines that there is not a reasonable
expectation of obtaining offers from two
or more responsible small business
concerns.
V. Paperwork Reduction Act
The rule affects the certification and
information collection requirements in
the provisions at FAR 52.212–3 and
52.225–4, 52.225–6, and 52.225–11
currently approved under the Office of
Management and Budget Control
Numbers 9000–0136, 9000–0130, 9000–
0025, and 9000–0141 respectively, in
accordance with the Paperwork
Reduction Act (44 U.S.C. chapter 35).
The impact, however, is negligible
because it is just a question of which
category offered goods from the
Republic of Korea would be listed
under.
List of Subjects in 48 CFR Parts 4, 25,
and 52
Government procurement.
Dated: September 7, 2012.
Laura Auletta,
Director, Office of Governmentwide
Acquisition Policy, Office of Acquisition
Policy, Office of Governmentwide Policy.
Interim Rule Adopted as Final Without
Changes
Accordingly, the interim rule
amending 48 CFR parts 4, 25, and 52,
which was published in the Federal
Register at 77 FR 13952 on March 7,
2012, is adopted as a final rule without
changes.
■
[FR Doc. 2012–22574 Filed 9–12–12; 8:45 am]
BILLING CODE 6820–EP–P
DEPARTMENT OF DEFENSE
GENERAL SERVICES
ADMINISTRATION
NATIONAL AERONAUTICS AND
SPACE ADMINISTRATION
48 CFR Part 6
[FAC 2005–61; FAR Case 2012–026; Item
II; Docket 2012–0026, Sequence 1]
RIN 9000–AM35
Federal Acquisition Regulation; Delete
Outdated FAR Reference to the DoD
Industrial Preparedness Program
Department of Defense (DoD),
General Services Administration (GSA),
and National Aeronautics and Space
Administration (NASA).
ACTION: Final rule.
AGENCY:
DoD, GSA, and NASA are
issuing a final rule amending the
SUMMARY:
PO 00000
Frm 00004
Fmt 4701
Sfmt 4700
Federal Acquisition Regulation (FAR) to
delete references to the obsolete ‘‘DoD
Industrial Preparedness Program’’.
DATES: Effective Date: October 15, 2012
FOR FURTHER INFORMATION CONTACT: Ms.
Deborah Lague, Procurement Analyst, at
202–694–8149, for clarification of
content. For information pertaining to
status or publication schedules, contact
the Regulatory Secretariat at 202–501–
4755. Please cite FAC 2005–61, FAR
Case 2012–026.
SUPPLEMENTARY INFORMATION:
I. Background
DoD, GSA, and NASA are issuing a
final rule to delete references to the
obsolete ‘‘DoD Industrial Preparedness
Program’’ at FAR 6.302–3(b)(iv).
In 1992, DoD rescinded the following
regulations for the DoD’s Industrial
Preparedness Program: DoD Directive
4005.1, Industrial Preparedness
Program; and DoD Instruction 4005.3,
Industrial Preparedness Planning.
References to the program have already
been removed from the Defense Federal
Acquisition Regulation Supplement
(DFARS) (71 FR 39004, July 11, 2006).
II. Publication of This Final Rule for
Public Comment Is Not Required by
Statute
‘‘Publication of proposed
regulations’’, 41 U.S.C. 1707, is the
statute which applies to the publication
of the FAR. Paragraph (a)(1) of the
statute requires that a procurement
policy, regulation, procedure or form
(including an amendment or
modification thereof) must be published
for public comment if it relates to the
expenditure of appropriated funds, and
has either a significant effect beyond the
internal operation procedures of the
agency issuing the policy, regulation,
procedure or form, or has a significant
cost or administrative impact on
contractors or offerors. This final rule is
not required to be published for public
comment because it only deletes
references to an obsolete program;
which has neither a significant effect
beyond the internal operation
procedures of the agency issuing the
policy, regulation, procedure or form,
nor has a significant cost or
administrative impact on contractors or
offerors.
III. 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,
E:\FR\FM\13SER3.SGM
13SER3
]]>Agencies
[Federal Register Volume 77, Number 178 (Thursday, September 13, 2012)]
[Rules and Regulations]
[Pages 56739-56740]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-22574]
[[Page 56739]]
-----------------------------------------------------------------------
DEPARTMENT OF DEFENSE
GENERAL SERVICES ADMINISTRATION
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
48 CFR Parts 4, 25 and 52
[FAC 2005-61; FAR Case 2012-004; Item I; Docket 2012-0004, Sequence 1]
RIN 9000-AM18
Federal Acquisition Regulation; United States-Korea Free Trade
Agreement
AGENCY: Department of Defense (DoD), General Services Administration
(GSA), and National Aeronautics and Space Administration (NASA).
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: DoD, GSA, and NASA are adopting as final, without change, an
interim rule amending the Federal Acquisition Regulation (FAR) to
implement the United States-Korea Free Trade Agreement. The Republic of
Korea is already party to the World Trade Organization Government
Procurement Agreement, but this trade agreement implements a lower
procurement threshold.
DATES: Effective Date: September 13, 2012.
FOR FURTHER INFORMATION CONTACT: Ms. Cecelia L. Davis, Procurement
Analyst, at 202-219-0202 for clarification of content. For information
pertaining to status or publication schedules, contact the Regulatory
Secretariat at 202-501-4755. Please cite FAC 2005-61, FAR Case 2012-
004.
SUPPLEMENTARY INFORMATION:
I. Background
DoD, GSA, and NASA published an interim rule in the Federal
Register on March 7, 2012 (77 FR 13952), to implement the Free Trade
Agreement with the Republic of Korea, which took effect on March 15,
2012. The comment period closed on May 7, 2012. Three respondents
submitted comments on the interim rule.
The interim rule added the Republic of Korea to the definition of
``Free Trade Agreement country'' in multiple locations in the FAR. The
Republic of Korea was already listed as a designated country because it
is party to the WTO GPA. The excluded services for the Korea FTA are
the same as for the WTO GPA. By implementation of this Korea FTA,
eligible goods and services from Korea are now covered when valued at
or above $100,000, rather than at or above the WTO GPA threshold of
$202,000. The threshold for the Korea FTA for construction is the same
as the threshold for the WTO GPA for construction.
II. Discussion and Analysis
The Civilian Agency Acquisition Council and the Defense Acquisition
Regulations Council (the Councils) reviewed the comments in the
development of the final rule. A discussion of the comments is provided
as follows:
A. Summary of Significant Changes
The Councils have adopted the interim rule as final without change.
B. Analysis of Public Comments
1. Impact on U.S. Businesses and Economy
Comment: One respondent expressed agreement that the United States
has the responsibility to do business with Free Trade Agreement
countries, but was concerned that lowering the trade agreements
threshold from $202,000 to $100,000 for goods and services from the
Republic of Korea will damage the small American business owners'
chances to compete, because of lower minimum wage in Korea. The
respondent was also concerned that lowering the threshold will increase
the national deficit. This respondent also stated that the rule will
benefit U.S. big business owners to the detriment of small American
business owners.
Response: DoD, GSA, and NASA issued this final rule because it
implements a statute (United States-Korea Free Trade Agreement
Implementation Act, Pub. L. 112-41, enacted on October 21, 2011). The
Councils do not have discretion to set trade agreement thresholds.
However, as discussed in the section on Regulatory Flexibility, the
lowering of the threshold from $202,000 to $100,0000 only applies to
the supplies and services covered by the Korea Free Trade Agreement.
For DoD, it only covers the non-defense items listed at Defense Federal
Acquisition Regulations System (DFARS) 225.401-70. Acquisitions that
are set aside or provide other form of preference for small businesses
are exempt from the Korea Free Trade Agreement. FAR 19.502-2 states
that acquisitions that do not exceed $150,000 (except as described in
paragraph (1) of the definition of ``simplified acquisition threshold''
at 2.101) are automatically reserved exclusively for small business
concerns, unless the contracting officer determines that there is not a
reasonable expectation of obtaining offers from two or more responsible
small business concerns.
2. Implementation in Contracts for Services
Comment: One respondent questioned how agencies will implement the
Korea Free Trade Agreement for services.
Response: This question is not unique to the Korea Free Trade
Agreement. The FAR does not provide provisions or clauses for the
specific implementation of any trade agreements. The FAR provisions and
clauses address only end products, because the provisions and clauses
are necessary to--
Waive the Buy American Act, which only applies to
supplies; and
Implement the purchase restriction at 25.403(c) for
acquisitions that exceed the World Trade Organization Government
Procurement Agreement (WTO GPA) threshold of $202,000. Below that
threshold, there is no purchase restriction on acquisition of services
from nondesignated countries.
The requirements of the Free Trade Agreements relate primarily to
acquisition procedures that are already specified in the FAR, e.g., FAR
5.203, Publicizing and response time; FAR 5.207, Preparation and
transmittal of synopses; and FAR 15.503, Notifications to unsuccessful
offerors (see FAR 25.408 for other applicable procedures).
3. Procuring Entities of the Central Level of the U.S. Government
Comment: One respondent requested that the final rule should
include the list of the entities of the U.S. central level of
Government, which have certain obligations with respect to Government
procurement of goods and services.
Response: The FAR has not included the list of Federal entities
subject to any other free trade agreement or the WTO GPA. Therefore,
the Councils do not consider inclusion of such a list in the FAR for
the Korea Free Trade Agreement to be necessary or appropriate.
4. Past Performance
Comment: One respondent expressed appreciation of the specific
reference to Article 17.5.2(b) of the Korea Free Trade Agreement in the
Federal Register preamble to the interim rule. Article 17.5.2.(b)
stipulates that an agency shall not impose a condition that, in order
for an offeror to be allowed to submit an offer or be awarded a
contract, the offeror has been previously awarded one or more contracts
by an agency of the United States Government or that the offeror has
prior work experience in the United States. The respondent suggested
that Office of Management and Budget
[[Page 56740]]
guidance on ``best practices for collecting and using current and past
performance information'' be updated by adding best practices related
to Articles 17.5.2(b) of the Korea Free Trade Agreement.
Response: Changes to the Office of Management and Budget guidance
are outside the scope of this rule. The Councils note, however, that
FAR 15.305(a)(2)(iv) already requires that, in the case of an offeror
without a record of relevant past performance or for whom information
on past performance is not available, the offeror may not be evaluated
favorably or unfavorably on past performance.
III. 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 a significant regulatory action and, therefore, was 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.
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 Korea is already a
designated country under the WTO GPA. Although the rule opens up
Government procurement to the goods and services of Korea at or above
the threshold of $100,000, the Department of Defense only applies the
trade agreements to the non-defense items listed at DFARS 225.401-70,
and acquisitions that are set aside or provide other form of preference
for small businesses are exempt from coverage of the agreement. FAR
19.502-2 states that acquisitions that do not exceed $150,000 (except
as described in paragraph (1) of the definition of ``simplified
acquisition threshold'' at 2.101) are automatically reserved
exclusively for small business concerns, unless the contracting officer
determines that there is not a reasonable expectation of obtaining
offers from two or more responsible small business concerns.
V. Paperwork Reduction Act
The rule affects the certification and information collection
requirements in the provisions at FAR 52.212-3 and 52.225-4, 52.225-6,
and 52.225-11 currently approved under the Office of Management and
Budget Control Numbers 9000-0136, 9000-0130, 9000-0025, and 9000-0141
respectively, in accordance with the Paperwork Reduction Act (44 U.S.C.
chapter 35). The impact, however, is negligible because it is just a
question of which category offered goods from the Republic of Korea
would be listed under.
List of Subjects in 48 CFR Parts 4, 25, and 52
Government procurement.
Dated: September 7, 2012.
Laura Auletta,
Director, Office of Governmentwide Acquisition Policy, Office of
Acquisition Policy, Office of Governmentwide Policy.
Interim Rule Adopted as Final Without Changes
0
Accordingly, the interim rule amending 48 CFR parts 4, 25, and 52,
which was published in the Federal Register at 77 FR 13952 on March 7,
2012, is adopted as a final rule without changes.
[FR Doc. 2012-22574 Filed 9-12-12; 8:45 am]
BILLING CODE 6820-EP-P
