Defense Federal Acquisition Regulation Supplement: Use of Commercial or Non-Government Standards (DFARS Case 2017-D014), 4366-4368 [2019-02524]

Download as PDF 4366 Federal Register / Vol. 84, No. 32 / Friday, February 15, 2019 / Rules and Regulations item or contract option shall not exceed $100 million in fiscal year 2017 constant dollars. (10 U.S.C. 2302e) PART 235—RESEARCH AND DEVELOPMENT CONTRACTING 5. Section 235.006–71 is amended by— ■ a. Redesignating the introductory text as paragraph (b); and ■ b. Adding paragraph (a). The addition reads as follows: ■ 235.006—71 Competition. (a) Use of a broad agency announcement with peer or scientific review for the award of science and technology proposals in accordance with 235.016(a) fulfills the requirement for full and open competition (see 206.102(d)(2)). * * * * * ■ 6. Section 235.016 is added to read as follows: 235.016 Broad agency announcement. (a) General. A broad agency announcement with peer or scientific review may be used for the award of science and technology proposals. Science and technology proposals include proposals for the following: (i) Basic research (budget activity 6.1). (ii) Applied research (budget activity 6.2). (iii) Advanced technology development (budget activity 6.3). (iv) Advanced component development and prototypes (budget activity 6.4). [FR Doc. 2019–02527 Filed 2–14–19; 8:45 am] DEPARTMENT OF DEFENSE Defense Acquisition Regulations System 48 CFR Part 211 [Docket DARS–2018–0021] RIN 0750–AJ23 Defense Federal Acquisition Regulation Supplement: Use of Commercial or Non-Government Standards (DFARS Case 2017–D014) Defense Acquisition Regulations System, Department of Defense (DoD). ACTION: Final rule. khammond on DSKBBV9HB2PROD with RULES AGENCY: DoD is issuing a final rule amending the Defense Federal Acquisition Regulation Supplement (DFARS) to implement a section of the National Defense Authorization Act for VerDate Sep<11>2014 16:03 Feb 14, 2019 Jkt 247001 I. Background DoD published a proposed rule in the Federal Register at 83 FR 30644 on June 29, 2018, to implement section 875(c) of the National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2017 (Pub. L. 114–328), which requires DoD to revise the DFARS to encourage contractors to propose commercial or non-Government standards and industry-wide practices that meet the intent of military or Government-unique specifications and standards. Four respondents submitted comments on the proposed rule. II. Discussion and Analysis DoD reviewed the public comments in the development of the final rule. A discussion of the comments received and any changes made to the rule are provided as follows: A. Summary of Significant Changes There were no changes from the proposed rule made in the final rule as a result of the public comments. B. Analysis of Public Comments 1. Support for the Rule Comment: Two respondents provided support for the proposed rule. Response: DoD acknowledges the support for the rule. BILLING CODE 5001–06–P SUMMARY: Fiscal Year 2017 by encouraging offerors to propose commercial or nonGovernment standards and industrywide practices that meet the intent of military or Government-unique specifications and standards. DATES: Effective February 15, 2019. FOR FURTHER INFORMATION CONTACT: Ms. Kimberly Bass, telephone 571–372– 6174. SUPPLEMENTARY INFORMATION: 2. Section 875 Implementation Comment: Several respondents shared concerns with DoD’s implementation of section 875 of the NDAA for FY 2017, regarding how standards would be added to the Acquisition Streamlining and Standardization Information System (ASSIST) database in order to implement the statutory requirements. The respondents also recommended revisions to the rule to allow contractors to propose equally effective standards and supporting data for reliance upon standards that meet the intent of the Government’s requirements and to require the Government to determine that a commercial or non-Government requirement does not meet a military specification or standard. Response: Maintenance of the ASSIST database is beyond the scope of this PO 00000 Frm 00060 Fmt 4700 Sfmt 4700 rule. Questions regarding standards and the ASSIST database should be directed to the Defense Standardization Program Office. Contact information is available at https://www.dsp.dla.mil/ContactUs1/. Removing the prohibition at DFARS 211.107(b) on DoD using Federal Acquisition Regulation (FAR) 52.211–7, Alternatives to GovernmentUnique Standards, allows offerors to propose standards as alternatives, as intended. The language in the rule meets the intent of the statute at section 875(c) of the NDAA for FY 2017. 3. ASSIST Database Instructions Comment: One respondent supported the use of the ASSIST database as a repository of voluntary consensus standards adopted by DoD and recommended additional instructions and clarification on how nonGovernment standards are selected for inclusion in the database. Response: Maintenance or modification of the ASSIST database is beyond the scope of this rule. Questions regarding standards and the ASSIST database should be directed to the Defense Standardization Program Office. Contact information is available at https://www.dsp.dla.mil/Contact-Us1/. 4. Applicability Comment: Three respondents were concerned by the limitation on applicability of section 875 of the NDAA for FY 2017 requirements to contracts over the simplified acquisition threshold (SAT) and noncommercial contracts. Response: Section III of this final rule preamble clarifies that the rule does not exclude solicitations for contracts valued at or below the SAT. No change to the text of the rule is required, since the proposed rule did not include a limitation to contracts valued above the SAT in the clause prescription. This rule, however, is not applicable to commercial contracts, including COTS, since Government- or military-unique specifications and standards should not be used in commercial contracts. 5. Use of FAR Provision 52.211–7 Comment: One respondent was concerned that the existing solicitation provision at FAR 52.211–7, Alternatives to Government-Unique Standards, uses a different standard in determining whether the standard proposed by the contractor is acceptable. The respondent was also concerned the rule required burden of proof from the contractor to demonstrate the contractor’s proposed standard meets the Government’s requirement. E:\FR\FM\15FER1.SGM 15FER1 Federal Register / Vol. 84, No. 32 / Friday, February 15, 2019 / Rules and Regulations Response: Although the statute uses the phrase ‘‘encourage contractors to propose commercial or non-Government standards and industry-wide practices that meet the intent of the military specifications and standards,’’ DoD retains the responsibility to ensure the requirements are met. Although offerors are encouraged to propose alternative standards, they must be subject to DoD’s review and approval. DoD standards ensure that essential mission requirements are met. It is the offeror’s responsibility to demonstrate that its proposed alternative standards meet the essential DoD mission requirements. 6. Revise DFARS Clause 252.211–7005 Comment: One respondent recommended revising DFARS clause 252.211–7005, Substitutions for Military or Federal Specifications and Standards, to meet the intent of the requirements in section 875. Response: The rule revises the prescription to require the use of the provision at FAR 52.211–7 when Government-unique specifications and standards are included in DoD solicitations; use of this provision was previously optional. This approach meets the intent of section 875 requirements. 7. Revise DFARS 211.201 Comment: One respondent recommended revising DFARS 211.201 to add the new requirements established in section 875, which require military specifications to be used in acquisitions only to define an exact design solution when there is no acceptable commercial or non-Government standard, or when the use of a commercial or nonGovernment standard is not cost effective. Response: DoD has determined it is unnecessary to revise DFARS 211.201, since the rule removes the prohibition at DFARS 211.107(b). This rule requires DoD to use FAR provision 52.211–7 to permit offerors to propose commercial or non-Government standards and industry-wide practices. khammond on DSKBBV9HB2PROD with RULES C. Other Changes A reference to section 875(c) of the NDAA for FY 2017 is added at 211.107(b) and a minor editorial change is made to DFARS 211.201 to revise the name of the database from ‘‘DLA ASSIST database’’ to ‘‘ASSIST database’’. VerDate Sep<11>2014 16:03 Feb 14, 2019 Jkt 247001 III. Applicability to Contracts at or Below the Simplified Acquisition Threshold and Contracts for Commercial Items, Including Commercially Available Off-the-Shelf Items The purpose of this rule is to implement section 875(c) of the NDAA for FY 2017, which requires DoD to revise the DFARS to encourage offerors to propose commercial or nonGovernment standards and industrywide practices that meet the intent of military or Government-unique specifications and standards. The rule does not add any new provisions or clauses; however, to comply with section 875(c), the rule requires DoD contracting officers to use the provision at FAR 52.211–7 in DoD solicitations that include military or Governmentunique specifications and standards. A. Applicability to Contracts at or Below the Simplified Acquisition Threshold 41 U.S.C. 1905 governs the applicability of laws to contracts or subcontracts in amounts not greater than the SAT. It is intended to limit the applicability of laws to such contracts or subcontracts. 41 U.S.C. 1905 provides that if a provision of law contains criminal or civil penalties, or if the FAR Council makes a written determination that it is not in the best interest of the Federal Government to exempt contracts or subcontracts at or below the SAT, the law will apply to them. The Principal Director, Defense Pricing and Contracting (DPC), is the appropriate authority to make comparable determinations for regulations to be published in the DFARS, which is part of the FAR system of regulations. In accordance with 41 U.S.C. 1905, the Principal Director, DPC, has determined that it would not be in the best interest of the Federal Government to exempt acquisitions not greater than the SAT from the requirements of section 875(c) of the NDAA for FY 2017. This rule prescribes the use of the provision at FAR 52.211–7 in DoD solicitations that include military or Government-unique specifications and standards, which include those for acquisitions valued at or below the SAT. It is possible that contracts valued at or below this threshold (currently $250,000), could contain military or Government-unique specifications or standards; therefore, it is necessary and appropriate to include this provision in such contracts in order to give potential offerors an opportunity to propose alternatives to such specifications and standards. Providing such opportunities to offerors may increase competition PO 00000 Frm 00061 Fmt 4700 Sfmt 4700 4367 and ultimately drive down costs associated with compliance with military or Government-unique specifications and standards. B. Applicability to Contracts and Subcontracts for the Procurement of Commercial Items, Including Commercially Available Off-the-Shelf Items 10 U.S.C. 2375 governs the applicability of Defense-unique statutes to contracts and subcontracts for procurement of commercial items, including commercially available offthe-shelf (COTS) items. It is intended to limit the applicability of these laws to such contracts or subcontracts. 10 U.S.C. 2375(b)(2) provides that if a provision of law contains criminal or civil penalties, or if the Under Secretary of Defense for Acquisition and Sustainment makes a written determination that it is not in the best interest of the Department of Defense to exempt contracts for the procurement of commercial items, then the provision of law will apply to contracts for the procurement of commercial items. 10 U.S.C. 2375(c)(2) and (d)(2) make similar provisions for subcontracts under contracts for the procurement of commercial items, and for the procurement of commercially available off-the-shelf (COTS) items. Determinations in accordance with 10 U.S.C. 2375 have not been made. This rule does not prescribe the provision at FAR 52.211–7 for use in solicitations issued using FAR part 12 procedures for the acquisition of commercial items, including COTS, since such contracts should not include military or Government-unique specifications or standards. IV. 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. E:\FR\FM\15FER1.SGM 15FER1 4368 Federal Register / Vol. 84, No. 32 / Friday, February 15, 2019 / Rules and Regulations DEPARTMENT OF DEFENSE This final rule is an E.O. 13771 regulatory action, because this rule is not significant under E.O. 12866. statute. DoD considers the approach described in the rule to be the most practical and beneficial for both Government and industry. VI. Regulatory Flexibility Act VII. Paperwork Reduction Act 48 CFR Parts 212, 215, 239, and 252 A final regulatory flexibility analysis (FRFA) has been prepared consistent with the Regulatory Flexibility Act, 5 U.S.C. 601, et seq. The FRFA is summarized as follows: This final rule implements section 875(c) of the National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2017 (Pub. L. 114–328). The objective of this rule is to require the use of FAR 52.211–7, Alternatives to Government-Unique Standards, in DoD solicitations that include military or Government-unique specifications and standards. This will encourage and permit offerors to propose alternatives to Government-unique standards by using an existing FAR provision. The legal basis for this rule is section 875(c) of the NDAA for FY 2017. There were no significant issues raised by the public in response to the initial regulatory flexibility analysis. Based on Federal Procurement Data System data for Product Service Code 5342 (hardware, weapon systems), this rule could potentially apply to approximately 710 unique entities, of which 565 are small businesses. This is based on the number of DoD contract awards in FY 2017. However, of that total, and given the DoD policy of discouraging the use of military specifications and standards in solicitations, this rule would likely impact no more than 40 offerors or potential contractors (the approximate number of DoD contractors involved in major weapons systems). Accordingly, DoD estimates that this rule will have limited impact. Given the fact that some small number of DoD solicitations may include a military or Governmentunique specification or standard generally limited to those involving a major weapons system, this rule provides a means for offerors to propose alternatives on a given solicitation. This rule contains reporting and recordkeeping requirements for those entities that, in response to a DoD solicitation containing military or Government-unique standards, wish to propose voluntary consensus standards that meet the Government’s requirements as alternatives to the Government-unique standards. The professional skill sets required are those of mid-level administrative personnel. There are no known significant alternative approaches to the rule that would meet the requirements of the The Paperwork Reduction Act (44 U.S.C. chapter 35) applies. The rule contains information collection requirements. OMB has cleared this information collection requirement under OMB control number 9000–0153, titled, OMB Circular A–119; FAR Sections Affected: 52.211–7 and 53.105. [Docket DARS–2019–0002] khammond on DSKBBV9HB2PROD with RULES V. Executive Orders 13771 VerDate Sep<11>2014 16:03 Feb 14, 2019 Jkt 247001 List of Subjects in 48 CFR Part 211 Government procurement. Jennifer Lee Hawes, Regulatory Control Officer, Defense Acquisition Regulations System. Therefore, 48 CFR part 211 is amended as follows: PART 211—DESCRIBING AGENCY NEEDS 1. The authority citation for part 211 continues to read as follows: ■ Authority: 41 U.S.C. 1303 and 48 CFR chapter 1. 2. Revise section 211.107 to read as follows: ■ 211.107 Solicitation provision. (b) To comply with section 875(c) of the National Defense Authorization Act for Fiscal Year 2017 (Pub. L. 114–328), use the provision at FAR 52.211–7, Alternatives to Government-Unique Standards, in DoD solicitations that include military or Government-unique specifications and standards. 3. Revise section 211.201 to read as follows: ■ 211.201 Identification and availability of specifications. Follow the procedures at PGI 211.201 for obtaining specifications, standards, and data item descriptions from the ASSIST database, including DoD adoption notices on voluntary consensus standards. [FR Doc. 2019–02524 Filed 2–14–19; 8:45 am] BILLING CODE 5000–06–P PO 00000 Frm 00062 Fmt 4700 Sfmt 4700 Defense Acquisition Regulations System RIN 0750–AK26 Defense Federal Acquisition Regulation Supplement: Extension of Supply Chain Risk Management Authority (DFARS Case 2018–D072) Defense Acquisition Regulations System, Department of Defense (DoD). ACTION: Final rule. AGENCY: DoD is issuing a final rule amending the Defense Federal Acquisition Regulation Supplement (DFARS) to implement a section of the National Defense Authorization Act for Fiscal Year 2019. DATES: Effective February 15, 2019. FOR FURTHER INFORMATION CONTACT: Ms. Kimberly R. Ziegler, telephone 571– 372–6095. SUPPLEMENTARY INFORMATION: SUMMARY: I. Background DoD is amending the DFARS to implement section 881 of the National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2019 (Pub. L. 115–232). Section 881 codifies the authority for information relating to supply chain risk at 10 U.S.C. 2339a and repeals the sunset date at sections 806(g) of the NDAA for FY 2011 (Pub. L. 111–383), as modified by section 806(a) of the NDAA for FY 2013 (Pub. L. 112–239), making the authority permanent. DoD published a final rule (DFARS Case 2012–D050) in the Federal Register at 80 FR 67243 on October 30, 2015, to implement section 806 of the NDAA for FY 2011, as amended by section 806 of the NDAA for FY 2013 (Pub. L. 112–239). The objective of the rule was to minimize the potential risk for supplies and services purchased by DoD to maliciously degrade the integrity and operation of sensitive information technology systems. The rule implemented the use of supply chain risk as an evaluation factor in information technology procurements for services or supplies as a covered system, as a part of a covered system, or in support of a covered system. DFARS provision 252.239–7017, Notice of Supply Chain Risk, and DFARS clause 252.239–7018, Supply Chain Risk, were added to inform contractors of the requirement to mitigate supply chain risk in the provision of supplies and E:\FR\FM\15FER1.SGM 15FER1

Agencies

[Federal Register Volume 84, Number 32 (Friday, February 15, 2019)]
[Rules and Regulations]
[Pages 4366-4368]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-02524]


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

DEPARTMENT OF DEFENSE

Defense Acquisition Regulations System

48 CFR Part 211

[Docket DARS-2018-0021]
RIN 0750-AJ23


Defense Federal Acquisition Regulation Supplement: Use of 
Commercial or Non-Government Standards (DFARS Case 2017-D014)

AGENCY: Defense Acquisition Regulations System, Department of Defense 
(DoD).

ACTION: Final rule.

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

SUMMARY: DoD is issuing a final rule amending the Defense Federal 
Acquisition Regulation Supplement (DFARS) to implement a section of the 
National Defense Authorization Act for Fiscal Year 2017 by encouraging 
offerors to propose commercial or non-Government standards and 
industry-wide practices that meet the intent of military or Government-
unique specifications and standards.

DATES: Effective February 15, 2019.

FOR FURTHER INFORMATION CONTACT: Ms. Kimberly Bass, telephone 571-372-
6174.

SUPPLEMENTARY INFORMATION: 

I. Background

    DoD published a proposed rule in the Federal Register at 83 FR 
30644 on June 29, 2018, to implement section 875(c) of the National 
Defense Authorization Act (NDAA) for Fiscal Year (FY) 2017 (Pub. L. 
114-328), which requires DoD to revise the DFARS to encourage 
contractors to propose commercial or non-Government standards and 
industry-wide practices that meet the intent of military or Government-
unique specifications and standards. Four respondents submitted 
comments on the proposed rule.

II. Discussion and Analysis

    DoD reviewed the public comments in the development of the final 
rule. A discussion of the comments received and any changes made to the 
rule are provided as follows:

A. Summary of Significant Changes

    There were no changes from the proposed rule made in the final rule 
as a result of the public comments.

B. Analysis of Public Comments

1. Support for the Rule
    Comment: Two respondents provided support for the proposed rule.
    Response: DoD acknowledges the support for the rule.
2. Section 875 Implementation
    Comment: Several respondents shared concerns with DoD's 
implementation of section 875 of the NDAA for FY 2017, regarding how 
standards would be added to the Acquisition Streamlining and 
Standardization Information System (ASSIST) database in order to 
implement the statutory requirements. The respondents also recommended 
revisions to the rule to allow contractors to propose equally effective 
standards and supporting data for reliance upon standards that meet the 
intent of the Government's requirements and to require the Government 
to determine that a commercial or non-Government requirement does not 
meet a military specification or standard.
    Response: Maintenance of the ASSIST database is beyond the scope of 
this rule. Questions regarding standards and the ASSIST database should 
be directed to the Defense Standardization Program Office. Contact 
information is available at https://www.dsp.dla.mil/Contact-Us1/. 
Removing the prohibition at DFARS 211.107(b) on DoD using Federal 
Acquisition Regulation (FAR) 52.211-7, Alternatives to Government-
Unique Standards, allows offerors to propose standards as alternatives, 
as intended. The language in the rule meets the intent of the statute 
at section 875(c) of the NDAA for FY 2017.
3. ASSIST Database Instructions
    Comment: One respondent supported the use of the ASSIST database as 
a repository of voluntary consensus standards adopted by DoD and 
recommended additional instructions and clarification on how non-
Government standards are selected for inclusion in the database.
    Response: Maintenance or modification of the ASSIST database is 
beyond the scope of this rule. Questions regarding standards and the 
ASSIST database should be directed to the Defense Standardization 
Program Office. Contact information is available at https://www.dsp.dla.mil/Contact-Us1/.
4. Applicability
    Comment: Three respondents were concerned by the limitation on 
applicability of section 875 of the NDAA for FY 2017 requirements to 
contracts over the simplified acquisition threshold (SAT) and 
noncommercial contracts.
    Response: Section III of this final rule preamble clarifies that 
the rule does not exclude solicitations for contracts valued at or 
below the SAT. No change to the text of the rule is required, since the 
proposed rule did not include a limitation to contracts valued above 
the SAT in the clause prescription. This rule, however, is not 
applicable to commercial contracts, including COTS, since Government- 
or military-unique specifications and standards should not be used in 
commercial contracts.
5. Use of FAR Provision 52.211-7
    Comment: One respondent was concerned that the existing 
solicitation provision at FAR 52.211-7, Alternatives to Government-
Unique Standards, uses a different standard in determining whether the 
standard proposed by the contractor is acceptable. The respondent was 
also concerned the rule required burden of proof from the contractor to 
demonstrate the contractor's proposed standard meets the Government's 
requirement.

[[Page 4367]]

    Response: Although the statute uses the phrase ``encourage 
contractors to propose commercial or non-Government standards and 
industry-wide practices that meet the intent of the military 
specifications and standards,'' DoD retains the responsibility to 
ensure the requirements are met. Although offerors are encouraged to 
propose alternative standards, they must be subject to DoD's review and 
approval. DoD standards ensure that essential mission requirements are 
met. It is the offeror's responsibility to demonstrate that its 
proposed alternative standards meet the essential DoD mission 
requirements.
6. Revise DFARS Clause 252.211-7005
    Comment: One respondent recommended revising DFARS clause 252.211-
7005, Substitutions for Military or Federal Specifications and 
Standards, to meet the intent of the requirements in section 875.
    Response: The rule revises the prescription to require the use of 
the provision at FAR 52.211-7 when Government-unique specifications and 
standards are included in DoD solicitations; use of this provision was 
previously optional. This approach meets the intent of section 875 
requirements.
7. Revise DFARS 211.201
    Comment: One respondent recommended revising DFARS 211.201 to add 
the new requirements established in section 875, which require military 
specifications to be used in acquisitions only to define an exact 
design solution when there is no acceptable commercial or non-
Government standard, or when the use of a commercial or non-Government 
standard is not cost effective.
    Response: DoD has determined it is unnecessary to revise DFARS 
211.201, since the rule removes the prohibition at DFARS 211.107(b). 
This rule requires DoD to use FAR provision 52.211-7 to permit offerors 
to propose commercial or non-Government standards and industry-wide 
practices.

C. Other Changes

    A reference to section 875(c) of the NDAA for FY 2017 is added at 
211.107(b) and a minor editorial change is made to DFARS 211.201 to 
revise the name of the database from ``DLA ASSIST database'' to 
``ASSIST database''.

III. Applicability to Contracts at or Below the Simplified Acquisition 
Threshold and Contracts for Commercial Items, Including Commercially 
Available Off-the-Shelf Items

    The purpose of this rule is to implement section 875(c) of the NDAA 
for FY 2017, which requires DoD to revise the DFARS to encourage 
offerors to propose commercial or non-Government standards and 
industry-wide practices that meet the intent of military or Government-
unique specifications and standards. The rule does not add any new 
provisions or clauses; however, to comply with section 875(c), the rule 
requires DoD contracting officers to use the provision at FAR 52.211-7 
in DoD solicitations that include military or Government-unique 
specifications and standards.

A. Applicability to Contracts at or Below the Simplified Acquisition 
Threshold

    41 U.S.C. 1905 governs the applicability of laws to contracts or 
subcontracts in amounts not greater than the SAT. It is intended to 
limit the applicability of laws to such contracts or subcontracts. 41 
U.S.C. 1905 provides that if a provision of law contains criminal or 
civil penalties, or if the FAR Council makes a written determination 
that it is not in the best interest of the Federal Government to exempt 
contracts or subcontracts at or below the SAT, the law will apply to 
them. The Principal Director, Defense Pricing and Contracting (DPC), is 
the appropriate authority to make comparable determinations for 
regulations to be published in the DFARS, which is part of the FAR 
system of regulations.
    In accordance with 41 U.S.C. 1905, the Principal Director, DPC, has 
determined that it would not be in the best interest of the Federal 
Government to exempt acquisitions not greater than the SAT from the 
requirements of section 875(c) of the NDAA for FY 2017. This rule 
prescribes the use of the provision at FAR 52.211-7 in DoD 
solicitations that include military or Government-unique specifications 
and standards, which include those for acquisitions valued at or below 
the SAT. It is possible that contracts valued at or below this 
threshold (currently $250,000), could contain military or Government-
unique specifications or standards; therefore, it is necessary and 
appropriate to include this provision in such contracts in order to 
give potential offerors an opportunity to propose alternatives to such 
specifications and standards. Providing such opportunities to offerors 
may increase competition and ultimately drive down costs associated 
with compliance with military or Government-unique specifications and 
standards.

B. Applicability to Contracts and Subcontracts for the Procurement of 
Commercial Items, Including Commercially Available Off-the-Shelf Items

    10 U.S.C. 2375 governs the applicability of Defense-unique statutes 
to contracts and subcontracts for procurement of commercial items, 
including commercially available off-the-shelf (COTS) items. It is 
intended to limit the applicability of these laws to such contracts or 
subcontracts. 10 U.S.C. 2375(b)(2) provides that if a provision of law 
contains criminal or civil penalties, or if the Under Secretary of 
Defense for Acquisition and Sustainment makes a written determination 
that it is not in the best interest of the Department of Defense to 
exempt contracts for the procurement of commercial items, then the 
provision of law will apply to contracts for the procurement of 
commercial items. 10 U.S.C. 2375(c)(2) and (d)(2) make similar 
provisions for subcontracts under contracts for the procurement of 
commercial items, and for the procurement of commercially available 
off-the-shelf (COTS) items.
    Determinations in accordance with 10 U.S.C. 2375 have not been 
made. This rule does not prescribe the provision at FAR 52.211-7 for 
use in solicitations issued using FAR part 12 procedures for the 
acquisition of commercial items, including COTS, since such contracts 
should not include military or Government-unique specifications or 
standards.

IV. 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.

[[Page 4368]]

V. Executive Orders 13771

    This final rule is an E.O. 13771 regulatory action, because this 
rule is not significant under E.O. 12866.

VI. Regulatory Flexibility Act

    A final regulatory flexibility analysis (FRFA) has been prepared 
consistent with the Regulatory Flexibility Act, 5 U.S.C. 601, et seq. 
The FRFA is summarized as follows:
    This final rule implements section 875(c) of the National Defense 
Authorization Act (NDAA) for Fiscal Year (FY) 2017 (Pub. L. 114-328). 
The objective of this rule is to require the use of FAR 52.211-7, 
Alternatives to Government-Unique Standards, in DoD solicitations that 
include military or Government-unique specifications and standards. 
This will encourage and permit offerors to propose alternatives to 
Government-unique standards by using an existing FAR provision. The 
legal basis for this rule is section 875(c) of the NDAA for FY 2017.
    There were no significant issues raised by the public in response 
to the initial regulatory flexibility analysis.
    Based on Federal Procurement Data System data for Product Service 
Code 5342 (hardware, weapon systems), this rule could potentially apply 
to approximately 710 unique entities, of which 565 are small 
businesses. This is based on the number of DoD contract awards in FY 
2017. However, of that total, and given the DoD policy of discouraging 
the use of military specifications and standards in solicitations, this 
rule would likely impact no more than 40 offerors or potential 
contractors (the approximate number of DoD contractors involved in 
major weapons systems). Accordingly, DoD estimates that this rule will 
have limited impact. Given the fact that some small number of DoD 
solicitations may include a military or Government-unique specification 
or standard generally limited to those involving a major weapons 
system, this rule provides a means for offerors to propose alternatives 
on a given solicitation.
    This rule contains reporting and recordkeeping requirements for 
those entities that, in response to a DoD solicitation containing 
military or Government-unique standards, wish to propose voluntary 
consensus standards that meet the Government's requirements as 
alternatives to the Government-unique standards. The professional skill 
sets required are those of mid-level administrative personnel.
    There are no known significant alternative approaches to the rule 
that would meet the requirements of the statute. DoD considers the 
approach described in the rule to be the most practical and beneficial 
for both Government and industry.

VII. Paperwork Reduction Act

    The Paperwork Reduction Act (44 U.S.C. chapter 35) applies. The 
rule contains information collection requirements. OMB has cleared this 
information collection requirement under OMB control number 9000-0153, 
titled, OMB Circular A-119; FAR Sections Affected: 52.211-7 and 53.105.

List of Subjects in 48 CFR Part 211

    Government procurement.

Jennifer Lee Hawes,
Regulatory Control Officer, Defense Acquisition Regulations System.

    Therefore, 48 CFR part 211 is amended as follows:

PART 211--DESCRIBING AGENCY NEEDS

0
1. The authority citation for part 211 continues to read as follows:

    Authority: 41 U.S.C. 1303 and 48 CFR chapter 1.


0
2. Revise section 211.107 to read as follows:


211.107  Solicitation provision.

    (b) To comply with section 875(c) of the National Defense 
Authorization Act for Fiscal Year 2017 (Pub. L. 114-328), use the 
provision at FAR 52.211-7, Alternatives to Government-Unique Standards, 
in DoD solicitations that include military or Government-unique 
specifications and standards.


0
3. Revise section 211.201 to read as follows:


211.201  Identification and availability of specifications.

    Follow the procedures at PGI 211.201 for obtaining specifications, 
standards, and data item descriptions from the ASSIST database, 
including DoD adoption notices on voluntary consensus standards.

[FR Doc. 2019-02524 Filed 2-14-19; 8:45 am]
 BILLING CODE 5000-06-P