Federal Acquisition Regulation; Interagency Acquisitions: Compliance by Nondefense Agencies With Defense Procurement Requirements, 69720-69723 [2012-27905]

Download as PDF 69720 Federal Register / Vol. 77, No. 224 / Tuesday, November 20, 2012 / Rules and Regulations (3) The Contractor shall ensure that the DUNS number is maintained with Dun & Bradstreet throughout the life of the contract. The Contractor shall communicate any change to the DUNS number to the Contracting Officer within 30 days after the change, so an appropriate modification can be issued to update the data on the contract. A change in the DUNS number does not necessarily require a novation be accomplished. Dun & Bradstreet may be contacted— (i) Via the internet at http:// fedgov.dnb.com/webform or if the Contractor does not have internet access, it may call Dun and Bradstreet at 1–866–705–5711 if located within the United States; or (ii) If located outside the United States, by contacting the local Dun and Bradstreet office. (d) Contractors may obtain additional information on registration and annual confirmation requirements at https:// www.acquisition.gov. (End of clause) [FR Doc. 2012–27904 Filed 11–19–12; 8:45 am] BILLING CODE 6820–EP–P DEPARTMENT OF DEFENSE GENERAL SERVICES ADMINISTRATION NATIONAL AERONAUTICS AND SPACE ADMINISTRATION 48 CFR Parts 4 and 17 [FAC 2005–62; FAR Case 2012–010; Item II; Docket 2012–0010, Sequence 01] RIN 9000–AM36 Federal Acquisition Regulation; Interagency Acquisitions: Compliance by Nondefense Agencies With Defense Procurement Requirements Department of Defense (DoD), General Services Administration (GSA), and National Aeronautics and Space Administration (NASA). ACTION: Interim rule. AGENCY: DoD, GSA, and NASA are issuing an interim rule amending the Federal Acquisition Regulation (FAR) to add new requirements specific to the acquisition of supplies and services by nondefense agencies on behalf of the DoD. This rule implements a section of the National Defense Authorization Act for Fiscal Year 2008, with later amendments. wreier-aviles on DSK5TPTVN1PROD with SUMMARY: Effective date: November 20, 2012. Comment date: Interested parties should submit written comments to the Regulatory Secretariat on or before January 22, 2013 to be considered in the formation of a final rule. DATES: VerDate Mar<15>2010 15:15 Nov 19, 2012 Jkt 229001 Submit comments identified by FAC 2005–62, FAR Case 2012–010, by any of the following methods: • Regulations.gov: http:// www.regulations.gov. Submit comments via the Federal eRulemaking portal by searching for ‘‘FAR Case 2012–010’’. Select the link ‘‘Submit a Comment’’ that corresponds with ‘‘FAR Case 2012–010.’’ Follow the instructions provided at the ‘‘Submit a Comment’’ screen. Please include your name, company name (if any), and ‘‘FAR Case 2012–010’’ on your attached document. • Fax: 202–501–4067. • Mail: General Services Administration, Regulatory Secretariat (MCVB), ATTN: Hada Flowers, 1275 First Street NE., 7th Floor, Washington, DC 20417. Instructions: Please submit comments only and cite FAC 2005–62, FAR Case 2012–010 in all correspondence related to this case. All comments received will be posted without change to http:// www.regulations.gov, including any personal and/or business confidential information provided. FOR FURTHER INFORMATION CONTACT: Ms. Patricia Corrigan, Procurement Analyst, at 202–208–1963 for clarification of content. For information pertaining to status or publication schedules, contact the Regulatory Secretariat at 202–501– 4755. Please cite FAC 2005–62, FAR Case 2012–010. SUPPLEMENTARY INFORMATION: ADDRESSES: I. Background DoD, GSA, and NASA are publishing this interim rule amending the FAR to implement the requirements of section 801 of the National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2008 (Pub. L. 110–181), as amended, (10 U.S.C. 2304 note). Section 801 of the NDAA for FY 2008, titled ‘‘Internal Controls for Procurement on Behalf of the Department of Defense by Certain Nondefense Agencies,’’ defines in general terms the ‘‘procurement policies, procedures, and internal controls’’ that constitute compliance with defense procurement requirements by a nondefense agency when it procures supplies and services on behalf of the DoD. Section 801(b) states, in part, that unless waived, a DoD acquisition official may place an order, make a purchase, or otherwise procure property or services for DoD in excess of the simplified acquisition threshold through a nondefense agency only if the nondefense agency conducting the acquisition on DoD’s behalf has certified PO 00000 Frm 00008 Fmt 4701 Sfmt 4700 that it will comply with defense procurement requirements for that fiscal year. Section 804 of the Duncan Hunter NDAA for FY 2009 (Pub. L. 110–417) amended the list of covered nondefense agencies established in previous NDAAs, and established deadlines for reviews of covered nondefense agencies. (The term ‘‘covered nondefense agency’’ is included in the definition of nondefense agencies of section 801 of the NDAA for FY 2008.) Section 806 of the NDAA for FY 2010 (Pub. L. 111–84), titled ‘‘Treatment of Nondefense Agency Procurements Under Joint Programs with Intelligence Community,’’ amended section 801(b) of the NDAA for FY 2008 by authorizing exclusions from section 801 internal control limitations for contracts entered into under joint programs for DoD and non-DoD elements of the intelligence community. Section 817 of the NDAA for FY 2012 (Pub. L. 112–81), titled ‘‘Compliance with Defense Procurement Requirements for Purposes of Internal Controls of Nondefense Agencies for Procurements of Behalf of the Department of Defense,’’ amended section 801(d) of the NDAA for FY 2008 (10 U.S.C. 2304 note) to provide clarifying language that identifies the types of laws and regulations with which nondefense departments and agencies must comply when procuring supplies and services on behalf of DoD. Specifically, section 817 clarifies that the nondefense agency certification of ‘‘compliance with defense procurement requirements’’ for a given fiscal year means compliance with (1) the FAR and other laws and regulations that apply to procurements of property and services by Federal agencies, and (2) laws and regulations (including DoD financial management regulations) that apply to procurements of property and services made by DoD through other Federal agencies. This interim rule makes the following changes: • Clarifies FAR 4.603(c) regarding the allocation of socioeconomic credit to the requesting agency for assisted acquisitions. • Adds to FAR 17.500(a) a crossreference to the new FAR subpart 17.7 for additional requirements for nondefense agencies when acquiring supplies and services on behalf of DoD; • Adds to FAR 17.502–1(b)(1)(i) a requirement for written confirmation by the requesting agency to the servicing agency in the event there are no agency unique requirements beyond the FAR that apply to an assisted acquisition. E:\FR\FM\20NOR2.SGM 20NOR2 Federal Register / Vol. 77, No. 224 / Tuesday, November 20, 2012 / Rules and Regulations • Cross-references new FAR subpart 17.7, Interagency Acquisitions: Acquisitions by Nondefense Agencies on Behalf of the Department of Defense, at 17.502–1(b)(1)(i) related to assisted acquisitions. • Creates a new FAR subpart FAR 17.7 applicable to the acquisition of supplies and services by nondefense agencies on behalf of DoD. • Creates a new FAR section 17.700 identifying the scope of the subpart. • Creates a new FAR section 17.701 providing definitions specific to subpart 17.7. • Creates a new FAR section 17.702 establishing the subpart’s applicability to all acquisitions made by nondefense agencies on behalf of DoD except for contracts for joint projects with DoD entered into by a nondefense agency that is an element of the intelligence community. • Creates a new FAR section 17.703, which establishes the policy related to internal controls and compliance certification under which nondefense agencies may procure supplies and services on behalf of DoD and identifies DoD acquisition official responsibilities when making acquisitions on behalf of DoD. wreier-aviles on DSK5TPTVN1PROD with 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, GSA, and NASA do not expect this rule to have a significant economic impact on a substantial number of small entities within the meaning of the Regulatory Flexibility Act 5 U.S.C. 601, et seq. Nevertheless, an Initial Regulatory Flexibility Analysis (IRFA) has been prepared and is summarized as follows. Section 801 of the NDAA for FY 2008 (Pub. L. 110–181), section 806 of the NDAA for FY 2010 (Pub. L. 111–84), and section 817 of the NDAA for FY 2012 (Pub. L. 112–81) address VerDate Mar<15>2010 15:15 Nov 19, 2012 Jkt 229001 requirements specific to the acquisition of supplies and services by nondefense agencies on behalf of DoD, and are, therefore, internal to the Government. However, this case also adds a clarification at FAR 4.603(c), restating existing Office of Federal Procurement Policy (OFPP) and Federal Procurement Data System (FPDS) policy regarding the allocation of socioeconomic credit for interagency acquisitions. Although DoD, GSA, and NASA do not expect the clarification to have a direct economic impact on a substantial number of small entities, there is the possibility that the regulatory clarification may improve the accuracy of FPDS data submissions related to the allocation of socioeconomic credit to agencies for contracts and orders awarded to a substantial number of small entities. Improved data accuracy can have a positive impact on agencies’ annual small business goals. The Regulatory Secretariat has submitted a copy of the IRFA to the Chief Counsel for Advocacy of the Small Business Administration. A copy of the IRFA may be obtained from the Regulatory Secretariat. DoD, GSA, and NASA invite comments from small business concerns and other interested parties on the expected impact of this rule on small entities. DoD, GSA, and NASA will also consider comments from small entities concerning the existing regulations in subparts affected by this rule consistent with 5 U.S.C. 610. Interested parties must submit such comments separately and should cite 5 U.S.C. 610 (FAC 2005–62, FAR Case 2012–010) in correspondence. IV. Paperwork Reduction Act The interim rule does not contain any 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). V. Determination To Issue an Interim Rule Pursuant to the Office of Federal Procurement Policy (OFPP) Reauthorization Act, the Secretary of Defense, the Administrator of General Services, and the Administrator of NASA have determined that urgent and compelling reasons exist to promulgate this interim rule without prior opportunity for public comment. This action is necessary because the NDAA for FY 2012 (Pub. L. 112–81) was enacted on December 31, 2011, and was effective upon enactment. Recognizing this, the FAR Principals opened FAR Case 2012–010 on January 19, 2012. Section 817 of the NDAA for FY 2012 amended section 801(d) of the NDAA for FY 2008 (10 U.S.C. 2304 note) to provide necessary clarifying language PO 00000 Frm 00009 Fmt 4701 Sfmt 4700 69721 that identifies the types of laws and regulations with which nondefense departments and agencies must comply when procuring supplies and services on behalf of DoD. Specifically, section 817 clarifies that the nondefense agency certification of ‘‘compliance with defense procurement requirements’’ for a given fiscal year means compliance with (1) the FAR and other laws and regulations that apply to procurements of property and services by Federal agencies, and (2) laws and regulations (including DoD financial management regulations) that apply to procurements of property and services made by DoD through other Federal agencies. If this rule, which also informs nondefense agencies regarding their responsibilities when buying on behalf of DoD, is not implemented as an interim rule, it will negatively impact the accuracy and completeness of nondefense agency certifications for fiscal year 2013. Every effort has been made to process this FAR requirement in an expeditious manner. Processing this rule as an interim rule, with an immediate effective date, will ensure that nondefense agencies conducting acquisitions on behalf of DoD are fully informed of DoD expectations and their responsibilities when nondefense agency senior management completes the statutorily-mandated certifications for fiscal year 2013. This requirement does not directly impact the public and is purely an administrative FAR change that affects Government agencies that conduct acquisitions on behalf of DoD. However, pursuant to 41 U.S.C. 1707 and FAR 1.501–3(b), DoD, GSA, and NASA will consider public comments received in response to this interim rule in the formation of the final rule. List of Subjects in 48 CFR Parts 4 and 17 Government procurement. Dated: November 9, 2012. Laura Auletta, Director, Office of Governmentwide Acquisition Policy, Office of Acquisition Policy, Office of Governmentwide Policy. Therefore, DoD, GSA, and NASA amend 48 CFR parts 4 and 17 as set forth below: ■ 1. The authority citation for 48 CFR parts 4 and 17 is revised to read as follows: Authority: 40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 51 U.S.C. 20113. PART 4—ADMINISTRATIVE MATTERS 2. Amend section 4.603 by adding two sentences to the end of paragraph (c) to read as follows: ■ E:\FR\FM\20NOR2.SGM 20NOR2 69722 4.603 Federal Register / Vol. 77, No. 224 / Tuesday, November 20, 2012 / Rules and Regulations Policy. * * * * * (c) * * * For assisted acquisitions, the requesting agency will receive socioeconomic credit for meeting agency small business goals, where applicable. Requesting agencies shall provide the appropriate agency/bureau component code as part of the written interagency agreement between the requesting and servicing agencies (see 17.502–1(b)(1)). * * * * * 3. Amend section 17.500 by adding a new sentence to the end of paragraph (a) to read as follows: ■ Scope of subpart. (a) * * * In addition to complying with the interagency acquisition policy and procedures in this subpart, nondefense agencies acquiring supplies and services on behalf of the Department of Defense shall also comply with the policy and procedures at subpart 17.7. * * * * * ■ 4. Amend section 17.502–1 by revising paragraph (b)(1)(i) to read as follows: 17.502–1 General. wreier-aviles on DSK5TPTVN1PROD with * * * * * (b) * * * (1) * * * (i) Prior to the issuance of a solicitation, the servicing agency and the requesting agency shall both sign a written interagency agreement that establishes the general terms and conditions governing the relationship between the parties, including roles and responsibilities for acquisition planning, contract execution, and administration and management of the contract(s) or order(s). The requesting agency shall provide to the servicing agency any unique terms, conditions, and applicable agency-specific statutes, regulations, directives, and other applicable requirements for incorporation into the order or contract. In the event there are no agency unique requirements beyond the FAR, the requesting agency shall so inform the servicing agency contracting officer in writing. For acquisitions on behalf of the Department of Defense, also see subpart 17.7. For patent rights, see 27.304–2. In preparing interagency agreements to support assisted acquisitions, agencies should review the Office of Federal Procurement Policy guidance, Interagency Acquisitions, available at http://www.whitehouse.gov/ VerDate Mar<15>2010 15:15 Nov 19, 2012 Jkt 229001 Subpart 17.7—Interagency Acquisitions: Acquisitions by Nondefense Agencies on Behalf of the Department of Defense Sec. 17.700 Scope of subpart. 17.701 Definitions. 17.702 Applicability. 17.703 Policy. an element of the intelligence community. 17.702 Subpart 17.7—Interagency Acquisitions: Acquisitions by Nondefense Agencies on Behalf of the Department of Defense 17.700 Scope of subpart. (a) Compliance with this subpart is in addition to the policies and procedures for interagency acquisitions set forth in subpart 17.5. This subpart prescribes policies and procedures specific to acquisitions of supplies and services by nondefense agencies on behalf of the Department of Defense (DoD). (b) This subpart implements Public Law 110–181, section 801, as amended (10 U.S.C. 2304 Note). 17.701 Definitions. As used in this subpart— Department of Defense (DoD) acquisition official means— (1) A DoD contracting officer; or (2) Any other DoD official authorized to approve a direct acquisition or an assisted acquisition on behalf of DoD. Nondefense agency means any department or agency of the Federal Government other than the Department of Defense. Nondefense agency that is an element of the intelligence community means the agencies identified in 50 U.S.C. 401a(4), which include the— (1) Office of the Director of National Intelligence; (2) Central Intelligence Agency; (3) Intelligence elements of the Federal Bureau of Investigation, Department of Energy, and Drug Enforcement Agency; (4) Bureau of Intelligence and Research of the Department of State; (5) Office of Intelligence and Analysis of the Department of the Treasury; (6) The Office of Intelligence and Analysis of the Department of Homeland Security and the Office of Intelligence of the Coast Guard; and (7) Such other elements of any department or agency as have been designated by the President, or designated jointly by the Director of National Intelligence and the head of the department or agency concerned, as PO 00000 Frm 00010 Fmt 4701 Sfmt 4700 Applicability. This subpart applies to all acquisitions made by nondefense agencies on behalf of DoD. It does not apply to contracts entered into by a nondefense agency that is an element of the intelligence community for the performance of a joint program conducted to meet the needs of DoD and the nondefense agency. 17.703 PART 17—SPECIAL CONTRACTING METHODS 17.500 omb/assets/procurement/ iac_revised.pdf. * * * * * ■ 5. Add Subpart 17.7 to read as follows: Policy. (a) A DoD acquisition official may request a nondefense agency to conduct an acquisition on behalf of DoD in excess of the simplified acquisition threshold only if the head of the nondefense agency conducting the acquisition on DoD’s behalf has certified that the agency will comply with defense procurement requirements for that fiscal year except when waived in accordance with paragraph (e) of this section. (b) A nondefense agency is compliant with defense procurement requirements if the procurement policies, procedures, and internal controls of the nondefense agency applicable to the procurement of supplies and services on behalf of DoD, and the manner in which they are administered, are adequate to ensure the compliance of the nondefense department or agency with— (1) The Federal Acquisition Regulation and other laws and regulations that apply to procurements of supplies and services by Federal agencies; and (2) Laws and regulations that apply to procurements of supplies and services made by DoD through other Federal agencies, including DoD financial management regulations, the Defense Federal Acquisition Regulation Supplement (DFARS), and the DFARS Procedures, Guidance, and Information (PGI). (The DFARS and PGIs are accessible at: http://www.acq.osd.mil/ dpap/). (c) Within 30 days of the beginning of each fiscal year, submit nondefense agency certifications of compliance to the Director, Defense Procurement and Acquisition Policy, Department of Defense, 3060 Defense Pentagon, Washington DC 20301–3060. (d) The DoD acquisition official, as defined at 17.701, shall provide to the servicing nondefense agency contracting officer any DoD-unique terms, conditions, other related statutes, regulations, directives, and other applicable requirements for incorporation into the order or contract. In the event there are no DoD-unique E:\FR\FM\20NOR2.SGM 20NOR2 Federal Register / Vol. 77, No. 224 / Tuesday, November 20, 2012 / Rules and Regulations requirements beyond the FAR, the DoD acquisition official shall so inform the servicing nondefense agency contracting officer in writing. Nondefense agency contracting officers are responsible for ensuring support provided in response to DoD’s request complies with paragraph (b) of this section. (e) Waiver. The limitation in paragraph (a) of this section shall not apply to the acquisition of supplies and services on behalf of DoD by a nondefense agency during any fiscal year for which the Under Secretary of Defense for Acquisition, Technology, and Logistics has determined in writing that it is necessary in the interest of DoD to acquire supplies and services through the nondefense agency during the fiscal year. The written determination shall identify the acquisition categories to which the waiver applies. (f) Nondefense agency certifications, waivers, and additional information are available at http://www.acq.osd.mil/ dpap/cpic/cp/ interagency_acquisition.html. [FR Doc. 2012–27905 Filed 11–19–12; 8:45 am] BILLING CODE 6820–EP–P DEPARTMENT OF DEFENSE GENERAL SERVICES ADMINISTRATION NATIONAL AERONAUTICS AND SPACE ADMINISTRATION 48 CFR Parts 25 and 52 [FAC 2005–62; FAR Case 2012–027; Item III; Docket 2012–0027, Sequence 01] RIN 9000–AM43 Federal Acquisition Regulation; Free Trade Agreement—Panama Department of Defense (DoD), General Services Administration (GSA), and National Aeronautics and Space Administration (NASA). ACTION: Interim rule. AGENCIES: DoD, GSA, and NASA are issuing an interim rule amending the Federal Acquisition Regulation (FAR) to implement the United States—Panama Trade Promotion Agreement. This Trade Promotion Agreement is a free trade agreement that provides for mutually non-discriminatory treatment of eligible products and services from Panama. DATES: Effective date: November 20, 2012. Comment date: Interested parties should submit written comments to the Regulatory Secretariat on or before wreier-aviles on DSK5TPTVN1PROD with SUMMARY: VerDate Mar<15>2010 15:15 Nov 19, 2012 Jkt 229001 January 22, 2013 to be considered in the formulation of a final rule. ADDRESSES: Submit comments identified by FAC 2005–62, FAR Case 2012–027, by any of the following methods: • Regulations.gov: http:// www.regulations.gov. Submit comments via the Federal eRulemaking portal by searching for ‘‘FAR Case 2012–027’’. Select the link ‘‘Submit a Comment’’ that corresponds with ‘‘FAR Case 2012– 027.’’ Follow the instructions provided at the ‘‘Submit a Comment’’ screen. Please include your name, company name (if any), and ‘‘FAR Case 2012– 027’’ on your attached document. • Fax: 202–501–4067. • Mail: General Services Administration, Regulatory Secretariat (MVCB), ATTN: Hada Flowers, 1275 First Street NE., 7th Floor, Washington, DC 20417. Instructions: Please submit comments only and cite FAC 2005–62, FAR Case 2012–027, in all correspondence related to this case. All comments received will be posted without change to http:// www.regulations.gov, including any personal and/or business confidential information provided. 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 2005–62, FAR Case 2012–027. SUPPLEMENTARY INFORMATION: I. Background DoD, GSA, and NASA are issuing an interim rule amending FAR part 25 and the corresponding provisions and clauses in part 52 to implement the United States—Panama Trade Promotion Agreement Implementation Act (Pub. L. 112–43) (19 U.S.C. 3805 note). This Trade Promotion Agreement is designated in the FAR as the Panama Free Trade Agreement (FTA). This FTA provides for— • Waiver of the applicability of the Buy American statute (41 U.S.C. chapter 83) for some foreign supplies and construction materials from Panama; and • Applicability of specified procurement procedures designed to ensure fairness in the acquisition of supplies and services (see FAR 25.408). II. Discussion and Analysis This interim rule adds Panama to the definition of ‘‘Free Trade Agreement country’’ in multiple locations in the FAR. PO 00000 Frm 00011 Fmt 4701 Sfmt 4700 69723 The Panama FTA covers acquisitions of supplies and services equal to or exceeding $202,000. The threshold for the Panama FTA is $7,777,000 for construction contracts. The Panama FTA threshold for supplies and services is higher than the threshold for supplies and services for most of the FTAs ($77,494), and equals the Bahrain, Morocco, Oman, and Peru FTA thresholds for supplies and services ($202,000). The excluded services for the Panama FTA are the same as for the Bahrain FTA, Dominican Republic— Central American FTA, Colombia FTA, Chile FTA, NAFTA, Oman FTA, and Peru FTA. III. Executive Order 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 do not expect this interim 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. Although the rule now opens up Government procurement to the goods and services of Panama, DoD, GSA, and NASA do not anticipate any significant economic impact on U.S. small businesses. The Department of Defense only applies the trade agreements to the non-defense items listed at Defense Federal Acquisition Regulation Supplement (DFARS) 225.401–70, and acquisitions that are set aside or provide other form of preference for small businesses are exempt. FAR 19.502–2 states that acquisitions of supplies or services with an anticipated dollar value between $3,000 and $150,000 (with some exceptions) are automatically reserved for small business concerns. E:\FR\FM\20NOR2.SGM 20NOR2

Agencies

[Federal Register Volume 77, Number 224 (Tuesday, November 20, 2012)]
[Rules and Regulations]
[Pages 69720-69723]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-27905]


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DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Parts 4 and 17

[FAC 2005-62; FAR Case 2012-010; Item II; Docket 2012-0010, Sequence 
01]
RIN 9000-AM36


Federal Acquisition Regulation; Interagency Acquisitions: 
Compliance by Nondefense Agencies With Defense Procurement Requirements

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

ACTION: Interim rule.

-----------------------------------------------------------------------

SUMMARY: DoD, GSA, and NASA are issuing an interim rule amending the 
Federal Acquisition Regulation (FAR) to add new requirements specific 
to the acquisition of supplies and services by nondefense agencies on 
behalf of the DoD. This rule implements a section of the National 
Defense Authorization Act for Fiscal Year 2008, with later amendments.

DATES: Effective date: November 20, 2012.
    Comment date: Interested parties should submit written comments to 
the Regulatory Secretariat on or before January 22, 2013 to be 
considered in the formation of a final rule.

ADDRESSES: Submit comments identified by FAC 2005-62, FAR Case 2012-
010, by any of the following methods:
     Regulations.gov: http://www.regulations.gov.
    Submit comments via the Federal eRulemaking portal by searching for 
``FAR Case 2012-010''. Select the link ``Submit a Comment'' that 
corresponds with ``FAR Case 2012-010.'' Follow the instructions 
provided at the ``Submit a Comment'' screen. Please include your name, 
company name (if any), and ``FAR Case 2012-010'' on your attached 
document.
     Fax: 202-501-4067.
     Mail: General Services Administration, Regulatory 
Secretariat (MCVB), ATTN: Hada Flowers, 1275 First Street NE., 7th 
Floor, Washington, DC 20417.
    Instructions: Please submit comments only and cite FAC 2005-62, FAR 
Case 2012-010 in all correspondence related to this case. All comments 
received will be posted without change to http://www.regulations.gov, 
including any personal and/or business confidential information 
provided.

FOR FURTHER INFORMATION CONTACT: Ms. Patricia Corrigan, Procurement 
Analyst, at 202-208-1963 for clarification of content. For information 
pertaining to status or publication schedules, contact the Regulatory 
Secretariat at 202-501-4755. Please cite FAC 2005-62, FAR Case 2012-
010.

SUPPLEMENTARY INFORMATION: 

I. Background

    DoD, GSA, and NASA are publishing this interim rule amending the 
FAR to implement the requirements of section 801 of the National 
Defense Authorization Act (NDAA) for Fiscal Year (FY) 2008 (Pub. L. 
110-181), as amended, (10 U.S.C. 2304 note).
    Section 801 of the NDAA for FY 2008, titled ``Internal Controls for 
Procurement on Behalf of the Department of Defense by Certain 
Nondefense Agencies,'' defines in general terms the ``procurement 
policies, procedures, and internal controls'' that constitute 
compliance with defense procurement requirements by a nondefense agency 
when it procures supplies and services on behalf of the DoD. Section 
801(b) states, in part, that unless waived, a DoD acquisition official 
may place an order, make a purchase, or otherwise procure property or 
services for DoD in excess of the simplified acquisition threshold 
through a nondefense agency only if the nondefense agency conducting 
the acquisition on DoD's behalf has certified that it will comply with 
defense procurement requirements for that fiscal year.
    Section 804 of the Duncan Hunter NDAA for FY 2009 (Pub. L. 110-417) 
amended the list of covered nondefense agencies established in previous 
NDAAs, and established deadlines for reviews of covered nondefense 
agencies. (The term ``covered nondefense agency'' is included in the 
definition of nondefense agencies of section 801 of the NDAA for FY 
2008.)
    Section 806 of the NDAA for FY 2010 (Pub. L. 111-84), titled 
``Treatment of Nondefense Agency Procurements Under Joint Programs with 
Intelligence Community,'' amended section 801(b) of the NDAA for FY 
2008 by authorizing exclusions from section 801 internal control 
limitations for contracts entered into under joint programs for DoD and 
non-DoD elements of the intelligence community.
    Section 817 of the NDAA for FY 2012 (Pub. L. 112-81), titled 
``Compliance with Defense Procurement Requirements for Purposes of 
Internal Controls of Nondefense Agencies for Procurements of Behalf of 
the Department of Defense,'' amended section 801(d) of the NDAA for FY 
2008 (10 U.S.C. 2304 note) to provide clarifying language that 
identifies the types of laws and regulations with which nondefense 
departments and agencies must comply when procuring supplies and 
services on behalf of DoD. Specifically, section 817 clarifies that the 
nondefense agency certification of ``compliance with defense 
procurement requirements'' for a given fiscal year means compliance 
with (1) the FAR and other laws and regulations that apply to 
procurements of property and services by Federal agencies, and (2) laws 
and regulations (including DoD financial management regulations) that 
apply to procurements of property and services made by DoD through 
other Federal agencies.
    This interim rule makes the following changes:
     Clarifies FAR 4.603(c) regarding the allocation of 
socioeconomic credit to the requesting agency for assisted 
acquisitions.
     Adds to FAR 17.500(a) a cross-reference to the new FAR 
subpart 17.7 for additional requirements for nondefense agencies when 
acquiring supplies and services on behalf of DoD;
     Adds to FAR 17.502-1(b)(1)(i) a requirement for written 
confirmation by the requesting agency to the servicing agency in the 
event there are no agency unique requirements beyond the FAR that apply 
to an assisted acquisition.

[[Page 69721]]

     Cross-references new FAR subpart 17.7, Interagency 
Acquisitions: Acquisitions by Nondefense Agencies on Behalf of the 
Department of Defense, at 17.502-1(b)(1)(i) related to assisted 
acquisitions.
     Creates a new FAR subpart FAR 17.7 applicable to the 
acquisition of supplies and services by nondefense agencies on behalf 
of DoD.
     Creates a new FAR section 17.700 identifying the scope of 
the subpart.
     Creates a new FAR section 17.701 providing definitions 
specific to subpart 17.7.
     Creates a new FAR section 17.702 establishing the 
subpart's applicability to all acquisitions made by nondefense agencies 
on behalf of DoD except for contracts for joint projects with DoD 
entered into by a nondefense agency that is an element of the 
intelligence community.
     Creates a new FAR section 17.703, which establishes the 
policy related to internal controls and compliance certification under 
which nondefense agencies may procure supplies and services on behalf 
of DoD and identifies DoD acquisition official responsibilities when 
making acquisitions on behalf of DoD.

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, GSA, and NASA do not expect this rule to have a significant 
economic impact on a substantial number of small entities within the 
meaning of the Regulatory Flexibility Act 5 U.S.C. 601, et seq. 
Nevertheless, an Initial Regulatory Flexibility Analysis (IRFA) has 
been prepared and is summarized as follows.

    Section 801 of the NDAA for FY 2008 (Pub. L. 110-181), section 
806 of the NDAA for FY 2010 (Pub. L. 111-84), and section 817 of the 
NDAA for FY 2012 (Pub. L. 112-81) address requirements specific to 
the acquisition of supplies and services by nondefense agencies on 
behalf of DoD, and are, therefore, internal to the Government. 
However, this case also adds a clarification at FAR 4.603(c), 
restating existing Office of Federal Procurement Policy (OFPP) and 
Federal Procurement Data System (FPDS) policy regarding the 
allocation of socioeconomic credit for interagency acquisitions. 
Although DoD, GSA, and NASA do not expect the clarification to have 
a direct economic impact on a substantial number of small entities, 
there is the possibility that the regulatory clarification may 
improve the accuracy of FPDS data submissions related to the 
allocation of socioeconomic credit to agencies for contracts and 
orders awarded to a substantial number of small entities. Improved 
data accuracy can have a positive impact on agencies' annual small 
business goals.

    The Regulatory Secretariat has submitted a copy of the IRFA to the 
Chief Counsel for Advocacy of the Small Business Administration. A copy 
of the IRFA may be obtained from the Regulatory Secretariat. DoD, GSA, 
and NASA invite comments from small business concerns and other 
interested parties on the expected impact of this rule on small 
entities.
    DoD, GSA, and NASA will also consider comments from small entities 
concerning the existing regulations in subparts affected by this rule 
consistent with 5 U.S.C. 610. Interested parties must submit such 
comments separately and should cite 5 U.S.C. 610 (FAC 2005-62, FAR Case 
2012-010) in correspondence.

IV. Paperwork Reduction Act

    The interim rule does not contain any 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).

V. Determination To Issue an Interim Rule

    Pursuant to the Office of Federal Procurement Policy (OFPP) 
Reauthorization Act, the Secretary of Defense, the Administrator of 
General Services, and the Administrator of NASA have determined that 
urgent and compelling reasons exist to promulgate this interim rule 
without prior opportunity for public comment. This action is necessary 
because the NDAA for FY 2012 (Pub. L. 112-81) was enacted on December 
31, 2011, and was effective upon enactment. Recognizing this, the FAR 
Principals opened FAR Case 2012-010 on January 19, 2012. Section 817 of 
the NDAA for FY 2012 amended section 801(d) of the NDAA for FY 2008 (10 
U.S.C. 2304 note) to provide necessary clarifying language that 
identifies the types of laws and regulations with which nondefense 
departments and agencies must comply when procuring supplies and 
services on behalf of DoD. Specifically, section 817 clarifies that the 
nondefense agency certification of ``compliance with defense 
procurement requirements'' for a given fiscal year means compliance 
with (1) the FAR and other laws and regulations that apply to 
procurements of property and services by Federal agencies, and (2) laws 
and regulations (including DoD financial management regulations) that 
apply to procurements of property and services made by DoD through 
other Federal agencies. If this rule, which also informs nondefense 
agencies regarding their responsibilities when buying on behalf of DoD, 
is not implemented as an interim rule, it will negatively impact the 
accuracy and completeness of nondefense agency certifications for 
fiscal year 2013.
    Every effort has been made to process this FAR requirement in an 
expeditious manner. Processing this rule as an interim rule, with an 
immediate effective date, will ensure that nondefense agencies 
conducting acquisitions on behalf of DoD are fully informed of DoD 
expectations and their responsibilities when nondefense agency senior 
management completes the statutorily-mandated certifications for fiscal 
year 2013. This requirement does not directly impact the public and is 
purely an administrative FAR change that affects Government agencies 
that conduct acquisitions on behalf of DoD.
    However, pursuant to 41 U.S.C. 1707 and FAR 1.501-3(b), DoD, GSA, 
and NASA will consider public comments received in response to this 
interim rule in the formation of the final rule.

List of Subjects in 48 CFR Parts 4 and 17

    Government procurement.

    Dated: November 9, 2012.
Laura Auletta,
Director, Office of Governmentwide Acquisition Policy, Office of 
Acquisition Policy, Office of Governmentwide Policy.

    Therefore, DoD, GSA, and NASA amend 48 CFR parts 4 and 17 as set 
forth below:

0
1. The authority citation for 48 CFR parts 4 and 17 is revised to read 
as follows:

    Authority: 40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 51 
U.S.C. 20113.

PART 4--ADMINISTRATIVE MATTERS

0
2. Amend section 4.603 by adding two sentences to the end of paragraph 
(c) to read as follows:

[[Page 69722]]

4.603  Policy.

* * * * *
    (c) * * * For assisted acquisitions, the requesting agency will 
receive socioeconomic credit for meeting agency small business goals, 
where applicable. Requesting agencies shall provide the appropriate 
agency/bureau component code as part of the written interagency 
agreement between the requesting and servicing agencies (see 17.502-
1(b)(1)).
* * * * *

PART 17--SPECIAL CONTRACTING METHODS

0
3. Amend section 17.500 by adding a new sentence to the end of 
paragraph (a) to read as follows:


17.500  Scope of subpart.

    (a) * * * In addition to complying with the interagency acquisition 
policy and procedures in this subpart, nondefense agencies acquiring 
supplies and services on behalf of the Department of Defense shall also 
comply with the policy and procedures at subpart 17.7.
* * * * *

0
4. Amend section 17.502-1 by revising paragraph (b)(1)(i) to read as 
follows:


17.502-1  General.

* * * * *
    (b) * * *
    (1) * * *
    (i) Prior to the issuance of a solicitation, the servicing agency 
and the requesting agency shall both sign a written interagency 
agreement that establishes the general terms and conditions governing 
the relationship between the parties, including roles and 
responsibilities for acquisition planning, contract execution, and 
administration and management of the contract(s) or order(s). The 
requesting agency shall provide to the servicing agency any unique 
terms, conditions, and applicable agency-specific statutes, 
regulations, directives, and other applicable requirements for 
incorporation into the order or contract. In the event there are no 
agency unique requirements beyond the FAR, the requesting agency shall 
so inform the servicing agency contracting officer in writing. For 
acquisitions on behalf of the Department of Defense, also see subpart 
17.7. For patent rights, see 27.304-2. In preparing interagency 
agreements to support assisted acquisitions, agencies should review the 
Office of Federal Procurement Policy guidance, Interagency 
Acquisitions, available at http://www.whitehouse.gov/omb/assets/procurement/iac_revised.pdf.
* * * * *

0
5. Add Subpart 17.7 to read as follows:
Subpart 17.7--Interagency Acquisitions: Acquisitions by Nondefense 
Agencies on Behalf of the Department of Defense
Sec.
17.700 Scope of subpart.
17.701 Definitions.
17.702 Applicability.
17.703 Policy.

Subpart 17.7--Interagency Acquisitions: Acquisitions by Nondefense 
Agencies on Behalf of the Department of Defense


17.700  Scope of subpart.

    (a) Compliance with this subpart is in addition to the policies and 
procedures for interagency acquisitions set forth in subpart 17.5. This 
subpart prescribes policies and procedures specific to acquisitions of 
supplies and services by nondefense agencies on behalf of the 
Department of Defense (DoD).
    (b) This subpart implements Public Law 110-181, section 801, as 
amended (10 U.S.C. 2304 Note).


17.701  Definitions.

    As used in this subpart--
    Department of Defense (DoD) acquisition official means--
    (1) A DoD contracting officer; or
    (2) Any other DoD official authorized to approve a direct 
acquisition or an assisted acquisition on behalf of DoD.
    Nondefense agency means any department or agency of the Federal 
Government other than the Department of Defense.
    Nondefense agency that is an element of the intelligence community 
means the agencies identified in 50 U.S.C. 401a(4), which include the--
    (1) Office of the Director of National Intelligence;
    (2) Central Intelligence Agency;
    (3) Intelligence elements of the Federal Bureau of Investigation, 
Department of Energy, and Drug Enforcement Agency;
    (4) Bureau of Intelligence and Research of the Department of State;
    (5) Office of Intelligence and Analysis of the Department of the 
Treasury;
    (6) The Office of Intelligence and Analysis of the Department of 
Homeland Security and the Office of Intelligence of the Coast Guard; 
and
    (7) Such other elements of any department or agency as have been 
designated by the President, or designated jointly by the Director of 
National Intelligence and the head of the department or agency 
concerned, as an element of the intelligence community.


17.702  Applicability.

    This subpart applies to all acquisitions made by nondefense 
agencies on behalf of DoD. It does not apply to contracts entered into 
by a nondefense agency that is an element of the intelligence community 
for the performance of a joint program conducted to meet the needs of 
DoD and the nondefense agency.


17.703  Policy.

    (a) A DoD acquisition official may request a nondefense agency to 
conduct an acquisition on behalf of DoD in excess of the simplified 
acquisition threshold only if the head of the nondefense agency 
conducting the acquisition on DoD's behalf has certified that the 
agency will comply with defense procurement requirements for that 
fiscal year except when waived in accordance with paragraph (e) of this 
section.
    (b) A nondefense agency is compliant with defense procurement 
requirements if the procurement policies, procedures, and internal 
controls of the nondefense agency applicable to the procurement of 
supplies and services on behalf of DoD, and the manner in which they 
are administered, are adequate to ensure the compliance of the 
nondefense department or agency with--
    (1) The Federal Acquisition Regulation and other laws and 
regulations that apply to procurements of supplies and services by 
Federal agencies; and
    (2) Laws and regulations that apply to procurements of supplies and 
services made by DoD through other Federal agencies, including DoD 
financial management regulations, the Defense Federal Acquisition 
Regulation Supplement (DFARS), and the DFARS Procedures, Guidance, and 
Information (PGI). (The DFARS and PGIs are accessible at: http://www.acq.osd.mil/dpap/).
    (c) Within 30 days of the beginning of each fiscal year, submit 
nondefense agency certifications of compliance to the Director, Defense 
Procurement and Acquisition Policy, Department of Defense, 3060 Defense 
Pentagon, Washington DC 20301-3060.
    (d) The DoD acquisition official, as defined at 17.701, shall 
provide to the servicing nondefense agency contracting officer any DoD-
unique terms, conditions, other related statutes, regulations, 
directives, and other applicable requirements for incorporation into 
the order or contract. In the event there are no DoD-unique

[[Page 69723]]

requirements beyond the FAR, the DoD acquisition official shall so 
inform the servicing nondefense agency contracting officer in writing. 
Nondefense agency contracting officers are responsible for ensuring 
support provided in response to DoD's request complies with paragraph 
(b) of this section.
    (e) Waiver. The limitation in paragraph (a) of this section shall 
not apply to the acquisition of supplies and services on behalf of DoD 
by a nondefense agency during any fiscal year for which the Under 
Secretary of Defense for Acquisition, Technology, and Logistics has 
determined in writing that it is necessary in the interest of DoD to 
acquire supplies and services through the nondefense agency during the 
fiscal year. The written determination shall identify the acquisition 
categories to which the waiver applies.
    (f) Nondefense agency certifications, waivers, and additional 
information are available at http://www.acq.osd.mil/dpap/cpic/cp/interagency_acquisition.html.

[FR Doc. 2012-27905 Filed 11-19-12; 8:45 am]
BILLING CODE 6820-EP-P