Defense Federal Acquisition Regulation Supplement: Prohibition on Contracting With Persons That Have Business Operations With the Maduro Regime (DFARS Case 2020-D010), 53751-53755 [2020-18633]
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Federal Register / Vol. 85, No. 169 / Monday, August 31, 2020 / Proposed Rules
offer. See subpart 204.7X. SPRS is
available at https://
www.sprs.csd.disa.mil, and the SPRS
user’s guides are available at https://
www.sprs.csd.disa.mil/reference.htm;
(B) The basis for award shall include
an evaluation of each supplier’s overall
risk assessment in SPRS, if applicable;
and
(C) Suppliers without a risk
assessment in SPRS are not evaluated
favorably or unfavorably under the risk
assessment factor.
(D) See 204.7X04 for use of the
provision at 252.204–70XX, Notice to
Prospective Suppliers on the Use of the
Supplier Performance Risk System in
Performance Evaluations.
As prescribed in 204.7X04, use the
following provision: NOTICE TO
PROSPECTIVE SUPPLIERS ON USE OF
THE SUPPLIER PERFORMANCE RISK
SYSTEM IN PERFORMANCE
EVALUATIONS (DATE)
■
(a) Definitions. As used in this provision—
Item risk means the probability that a
product or service, based on intended use,
will introduce performance risk resulting in
safety issues, mission degradation, or
monetary loss.
Price risk means a measure of whether a
proposed price for a product or service is
consistent with historical prices paid for that
item or service.
Supplier risk means the probability that an
award made to a supplier may subject the
procurement to the risk of unsuccessful
performance or to supply chain risk (see
Defense Federal Acquisition Regulation
Supplement 239.7301).
(b) The Supplier Performance Risk System
(SPRS), available at https://
www.sprs.csd.disa.mil, will be used in the
evaluation of suppliers’ performance for
acquisitions using Federal Acquisition
Regulation (FAR) part 13 simplified
acquisition procedures, including
solicitations using FAR part 12 procedures
for the acquisition of commercial items.
SPRS retrieves item, price, quality, delivery,
and supplier information on contracts from
Government reporting systems in order to
develop overall risk assessments.
(c) SPRS risk assessments will be used by
the Contracting Officer during the evaluation
of quotations or offers received in response
to this solicitation as follows:
(1) Item risk shall be considered to
determine whether the procurement
Defense Acquisition Regulations
System
Comments on the proposed rule
should be submitted in writing to the
address shown below on or before
October 30, 2020, to be considered in
the formation of a final rule.
ADDRESSES: Submit comments
identified by DFARS Case 2020–D010,
using any of the following methods:
Æ Regulations.gov: https://
www.regulations.gov. Search for
‘‘DFARS Case 2020–D010’’ under the
heading ‘‘Enter keyword or ID’’ and
selecting ‘‘Search.’’ Select ‘‘Comment
Now’’ and follow the instructions
provided to submit a comment. Please
include ‘‘DFARS Case 2020–D010’’ on
any attached documents.
Æ Email: osd.dfars@mail.mil. Include
DFARS Case 2020–D010 in the subject
line of the message.
Æ Fax: 571–372–6094.
Æ Mail: Defense Acquisition
Regulations System, Attn: Ms. Kimberly
Bass, OUSD(A&S)DPC/DARS, Room
3B941, 3060 Defense Pentagon,
Washington, DC 20301–3060.
Comments received generally will be
posted without change to https://
www.regulations.gov, including any
personal information provided. To
confirm receipt of your comment(s),
please check www.regulations.gov,
approximately two to three days after
submission to verify posting (except
allow 30 days for posting of comments
submitted by mail).
FOR FURTHER INFORMATION CONTACT: Ms.
Kimberly Bass, telephone 571–372–
6174.
48 CFR Parts 212, 225, and 252
SUPPLEMENTARY INFORMATION:
[Docket DARS–2020–0031]
I. Background
213.106–2–70
■
[Removed]
6. Remove section 213.106–2–70.
PART 252—SOLICITATION
PROVISIONS AND CONTRACT
CLAUSES
7. Add section 252.204–70XX to read
as follows:
■
252.204–70XX Notice to Prospective
Suppliers on Use of the Supplier
Performance Risk System in Performance
Evaluations.
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represents a high performance risk to the
Government.
(2) Price risk shall be considered as part of
determining if a proposed price is consistent
with historical prices paid for an item or
otherwise creates a risk to the Government.
(3) Supplier risk, including but not limited
to quality and delivery, shall be considered
during the evaluation of a supplier’s
performance history to assess the risk of
unsuccessful performance and supply chain
risk.
(d) SPRS risk assessments are generated
daily for each supplier. Suppliers are able to
access their risk assessment by following the
access instructions in the SPRS user’s guide
available at https://www.sprs.csd.disa.mil/
reference.htm. Suppliers are granted access
to SPRS for their own risk assessment
classifications only. SPRS reporting
procedures and risk assessment methodology
are detailed in the SPRS user’s guide. The
method to challenge a rating generated by
SPRS is also provided in the user’s guide.
SPRS evaluation criteria are available from
the reference at https://
www.sprs.csd.disa.mil/pdf/SPRS_
DataEvaluationCriteria.pdf.
(e) The Contracting Officer may consider
any other available and relevant information
when evaluating a quotation or an offer.
(End of provision)
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252.213–7000
[Removed]
8. Remove section 252.213–7000.
[FR Doc. 2020–18645 Filed 8–28–20; 8:45 am]
BILLING CODE 5001–06–P
DEPARTMENT OF DEFENSE
RIN 0750–AK97
Defense Federal Acquisition
Regulation Supplement: Prohibition on
Contracting With Persons That Have
Business Operations With the Maduro
Regime (DFARS Case 2020–D010)
Defense Acquisition
Regulations System, Department of
Defense (DoD).
ACTION: Proposed rule.
AGENCY:
DoD is proposing to amend
the Defense Federal Acquisition
Regulation Supplement (DFARS) to
implement a statute that prohibits the
Department of Defense from entering
into contracts for the procurement of
goods and services with any person that
has business operations with an
authority of the government of
Venezuela that is not recognized as the
legitimate government of Venezuela by
the United States Government.
SUMMARY:
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DATES:
DoD is proposing to amend the
DFARS, to implement section 890 of the
National Defense Authorization Act
(NDAA) for Fiscal Year (FY) 2020 (Pub.
L. 116–92). Section 890 prohibits
contracts for the procurement of goods
and services with any person that has
business operations with an authority of
the government of Venezuela that is not
recognized as the legitimate government
of Venezuela by the United States
Government, subject to exceptions.
II. Discussion and Analysis
This rule proposes to add section
DFARS 225.7019, Prohibition on
Contracting with the Maduro Regime.
This section provides to contracting
officers a new solicitation provision and
contract clause for use in solicitations
and contracts, including solicitations
and contracts using FAR part 12
procedures for the acquisition of
commercial items, unless an exception
applies.
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A. Solicitation Provision and Contract
Clause
Per the new solicitation provision,
DFARS 252.225–70XX, Representation
Regarding Business Operations with the
Maduro Regime, an offeror represents,
by submission of its offer, that the
offeror does not conduct any prohibited
business operations with persons or
entities with the Maduro regime or the
government of Venezuela, or the offeror
has a valid license to operate in
Venezuela issued by the Office of
Foreign Assets Control of the
Department of the Treasury. The clause,
DFARS 252.225–70YY, Prohibition
Regarding Business Operations with the
Maduro Regime, prohibits DoD
contractors from entering into a contract
or subcontract for the procurement of
products or services with any person
that has business operations with an
authority of the government of
Venezuela that is not recognized as the
legitimate government of Venezuela by
the United States Government, subject
to the listed exceptions, as a condition
of the contract.
B. Definitions
Definitions are added for the terms
‘‘Agency or instrumentality of the
government of Venezuela,’’ ‘‘Business
operations,’’ ‘‘Government of
Venezuela,’’ and ‘‘Person,’’ as set out in
the regulatory text at the end of this
document.
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C. Exceptions
Exceptions to the prohibition are
provided to include contracts that are—
• Jointly determined by the Secretary
of Defense and the Secretary of State to
be necessary for certain humanitarian or
disaster relief purposes or vital to the
national security interests of the United
States;
• Related to the operation and
maintenance of the United States
Government’s consular offices and
diplomatic posts in Venezuela; or
• Awarded to a person that has a
valid license to operate in Venezuela
issued by the Office of Foreign Assets
Control of the Department of the
Treasury, that otherwise would be
prohibited.
III. Applicability to Contracts at or
Below the Simplified Acquisition
Threshold and for Commercial Items,
Including Commercially Available Offthe-Shelf Items
This rule proposes to create a new
provision and a new clause: (1) DFARS
252.225–70XX, Representation
Regarding Business Operations with the
Maduro Regime; and (2) DFARS
252.225–70YY, Prohibition Regarding
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Business Operations with the Maduro
Regime.
DoD plans to apply the provision and
the clause to solicitations, contracts, or
subcontracts below the simplified
acquisition threshold (SAT) and to the
acquisition of commercial items,
including commercially available offthe-shelf (COTS) items, as defined at
FAR 2.101. This DFARS rule
implements section 890 of the NDAA
for FY 2020. Section 890 prohibits
contracts for the procurement of goods
and services with any person that has
business operations with an authority of
the government of Venezuela, subject to
exceptions.
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 simplified acquisition
threshold. 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.
B. Applicability to Contracts for the
Acquisition of Commercial Items,
Including COTS Items
10 U.S.C. 2375 exempts contracts and
subcontracts for the acquisition of
commercial items (including COTS
items) from provisions of law enacted
after October 13, 1994, that, as
determined by the Under Secretary of
Defense for Acquisition and
Sustainment (USD(A&S)), set forth
policies, procedures, requirements, or
restrictions for the acquisition of
property or services unless—
• The provision of law—
Æ Provides for criminal or civil
penalties;
Æ Requires that certain articles be
bought from American sources pursuant
to 10 U.S.C. 2533a or that strategic
materials critical to national security be
bought from American sources pursuant
to 10 U.S.C. 2533b; or
Æ Specifically refers to 10 U.S.C. 2375
and states that it shall apply to contracts
and subcontracts for the acquisition of
commercial items (including COTS
items); or
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• USD (A&S) determines in writing
that it would not be in the best interest
of the Government to exempt contracts
or subcontracts for the acquisition of
commercial items from the applicability
of the provision.
This authority has been delegated to
the Principal Director, Defense Pricing
and Contracting.
C. Applicability
Section 890 of the NDAA for FY 2020
is silent on applicability to contracts
and subcontracts in amounts no greater
than the SAT or for the acquisition of
commercial items. Also, the statute does
not provide for civil or criminal
penalties. Therefore, it does not apply to
contracts or subcontracts in amounts not
greater than the SAT or to the
acquisition of commercial items unless
the Principal Director, Defense Pricing
and Contracting, makes a written
determination as provided in 41 U.S.C.
1905 and 10 U.S.C. 2375.
Not applying this rule to contracts
and subcontracts below the SAT and for
the acquisition of commercial items,
including COTS items, would exclude
contracts intended to be covered by this
rule and undermine the overarching
purpose of the rule to prohibit business
operations with the Maduro Regime
with an authority of the government of
Venezuela. This is particularly true with
regard to the acquisition of fuel and
petroleum, procurements which are
usually commercial items. To not
include the acquisition of fuel and
petroleum within this prohibition or not
applying the prohibition below the SAT
will unacceptably diminish the impact
of these sanctions on the Maduro
regime, the government of Venezuela
that is not recognized by the United
States Government as the legitimate
government of Venezuela.
Consequently, DoD plans to apply the
rule to contracts and subcontracts below
the SAT and for the acquisition of
commercial items, including COTS
items.
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
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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.
V. Executive Order 13771
This rule is not expected to be subject
to E.O. 13771, because this rule is not
expected to be significant under E.O.
12866.
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VI. Regulatory Flexibility Act
DoD does not expect this proposed
rule to have a significant economic
impact on a substantial number of small
entities within the meaning of the
Regulatory Flexibility Act, 5 U.S.C. 601,
et seq. Nevertheless, an initial
regulatory flexibility analysis has been
performed and summarized as follows:
The rule amends the Defense Federal
Acquisition Regulation Supplement
(DFARS) to implement a statute that
prohibits contracts for the procurement
of goods and services with any person
that has business operations with an
authority of the government of
Venezuela, subject to exceptions.
The objective and legal basis for the
rule is to implement section 890 of the
National Defense Authorization Act
(NDAA) for Fiscal Year (FY) 2020 which
prohibits contracts for the procurement
of goods and services with any person
that has business operations with an
authority of the government of
Venezuela, subject to exceptions for
contracts that are—
• Jointly determined by the Secretary
of Defense and the Secretary of State to
be necessary for certain humanitarian or
disaster relief purposes or vital to the
national security interests of the United
States;
• Related to the operation and
maintenance of the United States
Government’s consular offices and
diplomatic posts in Venezuela; or
• Awarded to a person that has a
valid license to operate in Venezuela
issued by the Office of Foreign Assets
Control of the Department of the
Treasury, that otherwise would be
prohibited.
DoD reviewed the Federal
Procurement Data System (FPDS) data
for fiscal years (FY) 2017, 2018, and
2019 (including contracts or
subcontracts that do not exceed the
simplified acquisition threshold) to
determine the estimated impact of the
rule on U.S. small businesses. There
were no DoD actions reported to FPDS
during the period FY 2017 through FY
2019, where the vendor is located in
Venezuela or the place of performance
is Venezuela.
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It is expected that this rule will not
impact small businesses.
This rule does not include any new
reporting, recordkeeping, or other
compliance requirements for small
businesses. The rule does not duplicate,
overlap, or conflict with any other
Federal rules.
There are no known significant
alternative approaches to the rule that
would meet the requirements of the
statute.
DoD invites comments from small
entities concerning the existing
regulations in subparts affected by this
rule in accordance with 5 U.S.C. 610.
Interested parties must submit such
comments separately and should cite 5
U.S.C. 610 (DFARS Case 2020–D010), in
correspondence.
VII. Paperwork Reduction Act
The 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).
List of Subjects in 48 CFR Parts 212,
225, and 252
Government procurement.
Jennifer Lee Hawes,
Regulatory Control Officer, Defense
Acquisition Regulations System.
Therefore, 48 CFR parts 212, 225, and
252 are proposed to be amended as
follows:
■ 1. The authority citation for 48 CFR
parts 212, 225, and 252 continues to
read as follows:
Authority: 41 U.S.C. 1303 and 48 CFR
chapter 1.
PART 212—ACQUISITION OF
COMMERCIAL ITEMS
2. Amend section 212.301 by adding
paragraphs (f)(ix)(GG) and (HH) to read
as follows:
■
212.301 Solicitation provisions and
contract clauses for the acquisition of
commercial items.
*
*
*
*
*
(f) * * *
(ix) * * *
(GG) Use the provision at 252.225–
70XX, Representation Regarding
Business Operations with the Maduro
Regime, as prescribed in 225.7019–5(a),
to comply with section 890 of the
National Defense Authorization Act for
Fiscal Year 2020 (Pub. L. 116–92).
(HH) Use the clause at 252.225–70YY,
Prohibition Regarding Business
Operations with the Maduro Regime, as
prescribed in 225.7019–5(b), to comply
with section 890 of the National Defense
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53753
Authorization Act for Fiscal Year 2020
(Pub. L. 116–92).
*
*
*
*
*
PART 225—FOREIGN ACQUISITION
3. Add sections 225.7019, 225.7019–1,
225.7019–2, 225.7019–3, 225.7019–4,
and 225.7019–5 to subpart 225.70 to
read as follows:
*
*
*
*
*
■
Sec.
225.7019 Prohibition on contracting with
the Maduro regime.
225.7019–1 Definitions.
225.7019–2 Prohibition.
225.7019–3 Exceptions.
225.7019–4 Joint determination.
225.7019–5 Solicitation provision and
contract clause.
*
*
*
*
*
225.7019 Prohibition on contracting with
the Maduro regime.
225.7019–1
Definitions.
As used in this section—
Agency or instrumentality of the
government of Venezuela means an
agency or instrumentality of a foreign
state as defined in section 28 U.S.C.
1603(b), with each reference in such
section to a foreign state deemed to be
a reference to Venezuela.
Business operations means engaging
in commerce in any form, including
acquiring, developing, maintaining,
owning, selling, possessing, leasing, or
operating equipment, facilities,
personnel, products, services, personal
property, real property, or any other
apparatus of business or commerce.
Government of Venezuela means the
government of any political subdivision
of Venezuela, and any agency or
instrumentality of the government of
Venezuela.
Person means—
(1) A natural person, corporation,
company, business association,
partnership, society, trust, or any other
nongovernmental entity, organization,
or group;
(2) Any governmental entity or
instrumentality of a government,
including a multilateral development
institution (as defined in section
1701(c)(3) of the International Financial
Institutions Act (22 U.S.C. 262r(c)(3));
and
(3) Any successor, subunit, parent
entity, or subsidiary of, or any entity
under common ownership or control
with, any entity described in paragraph
(1) or (2) of this definition.
225.7019–2
Prohibition.
In accordance with section 890 of the
National Defense Authorization Act for
Fiscal Year 2020 (Pub. L. 116–92), DoD
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is prohibited from entering into a
contract for the procurement of products
or services with any person that has
business operations with an authority of
the government of Venezuela that is not
recognized as the legitimate government
of Venezuela by the United States
Government, except as provided in
225.7019–3 or 225.7019–4.
225.7019–3
Exceptions.
The prohibition in 225.7019–2 does
not apply if—
(a) The person has a valid license to
operate in Venezuela issued by the
Office of Foreign Assets Control of the
Department of the Treasury; or
(b) The acquisition is related to the
operation and maintenance of the
United States Government’s consular
office and diplomatic posts in
Venezuela.
225.7019–4
Joint determination.
(a) The prohibition in section
225.7019–2 does not apply to an
acquisition jointly determined by the
Secretary of Defense and Secretary of
State to be—
(1) Necessary for purposes of—
(i) Providing humanitarian assistance
to the people of Venezuela;
(ii) Disaster relief and other urgent
lifesaving measures; or
(iii) Carrying out noncombatant
evacuations; or
(2) Vital to the national security
interests of the United States.
(b) Follow the procedures at PGI
225.7019–4(b) when entering into a
contract on the basis of a joint
determination.
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225.7019–5 Solicitation provision and
contract clause.
(a) Use the provision at 252.225–
70XX, Representation Regarding
Business Operations with the Maduro
Regime, in solicitations that include the
clause at 252.225–70YY, Prohibition
Regarding Business Operations with the
Maduro Regime, including solicitations
using FAR part 12 procedures for the
acquisition of commercial items.
(b) Unless an exception at 225.7019–
3 applies or a joint determination has
been made in accordance with
225.7019–4, use the clause at 252.225–
70YY, Prohibition Regarding Business
Operations with the Maduro Regime, in
solicitations and contracts, including
solicitations and contracts using FAR
part 12 procedures for the acquisition of
commercial items.
PART 252—SOLICITATION
PROVISIONS AND CONTRACT
CLAUSES
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252.225–70YY Prohibition Regarding
Business Operations with the Maduro
Regime.
As prescribed in 225.7019–5(a), use
the following provision:
As prescribed in 225.7019–5(b), use
the following clause:
REPRESENTATION REGARDING
BUSINESS OPERATIONS WITH THE
MADURO REGIME (DATE)
PROHIBITION REGARDING
BUSINESS OPERATIONS WITH THE
MADURO REGIME (DATE)
(a) Definitions. As used in this provision—
Agency or instrumentality of the
government of Venezuela means an agency or
instrumentality of a foreign state as defined
in section 28 U.S.C. 1603(b), with each
reference in such section to a foreign state
deemed to be a reference to Venezuela.
Business operations means engaging in
commerce in any form, including acquiring,
developing, maintaining, owning, selling,
possessing, leasing, or operating equipment,
facilities, personnel, products, services,
personal property, real property, or any other
apparatus of business or commerce.
Government of Venezuela means the
government of any political subdivision of
Venezuela, and any agency or
instrumentality of the government of
Venezuela.
Person means—
(1) A natural person, corporation,
company, business association, partnership,
society, trust, or any other nongovernmental
entity, organization, or group;
(2) Any governmental entity or
instrumentality of a government, including a
multilateral development institution (as
defined in section 1701(c)(3) of the
International Financial Institutions Act (22
U.S.C. 262r(c)(3)); and
(3) Any successor, subunit, parent entity,
or subsidiary of, or any entity under common
ownership or control with, any entity
described in paragraph (1) or (2) of this
definition.
(b) Prohibition. In accordance with section
890 of the National Defense Authorization
Act for Fiscal Year 2020 (Pub. L. 116–92),
DoD is prohibited from entering into a
contract for the procurement of products or
services with any person that has business
operations with an authority of the
government of Venezuela that is not
recognized as the legitimate government of
Venezuela by the United States Government,
unless the person has a valid license to
operate in Venezuela issued by the Office of
Foreign Assets Control of the Department of
the Treasury.
(c) Representation. By submission of its
offer, the Offeror represents that the Offeror—
(1) Does not have any business operations
with an authority of the Maduro regime or
the government of Venezuela that is not
recognized as the legitimate government of
Venezuela by the United States Government;
or
(2) Has a valid license to operate in
Venezuela issued by the Office of Foreign
Assets Control of the Department of the
Treasury.
(a) Definitions. As used in this clause—
Agency or instrumentality of the
government of Venezuela means an agency or
instrumentality of a foreign state as defined
in section 28 U.S.C. 1603(b), with each
reference in such section to a foreign state
deemed to be a reference to Venezuela.
Business operations means engaging in
commerce in any form, including acquiring,
developing, maintaining, owning, selling,
possessing, leasing, or operating equipment,
facilities, personnel, products, services,
personal property, real property, or any other
apparatus of business or commerce.
Government of Venezuela means the
government of any political subdivision of
Venezuela, and any agency or
instrumentality of the government of
Venezuela.
Person means—
(1) A natural person, corporation,
company, business association, partnership,
society, trust, or any other nongovernmental
entity, organization, or group;
(2) Any governmental entity or
instrumentality of a government, including a
multilateral development institution (as
defined in section 1701(c)(3) of the
International Financial Institutions Act (22
U.S.C. 262r(c)(3)); and
(3) Any successor, subunit, parent entity,
or subsidiary of, or any entity under common
ownership or control with, any entity
described in paragraph (1) or (2) of this
definition.
(b) Prohibition. In accordance with section
890 of the National Defense Authorization
Act for Fiscal Year 2020 (Pub. L. 116–92),
DoD is prohibited from entering into a
contract for the procurement of products or
services with any person that has business
operations with an authority of the
government of Venezuela that is not
recognized as the legitimate government of
Venezuela by the United States Government,
unless the person has a valid license to
operate in Venezuela issued by the Office of
Foreign Assets Control of the Department of
the Treasury.
(c) The Contractor shall—
(1) Not have any business operations with
an authority of the Maduro regime or the
government of Venezuela that is not
recognized as the legitimate government of
Venezuela by the United States Government;
or
(2) Have a valid license to operate in
Venezuela issued by the Office of Foreign
Assets Control of the Department of the
Treasury.
(d) Subcontracts. The Contractor shall
insert the substance of this clause, including
this paragraph (d), in all subcontracts,
including subcontracts for the acquisition of
commercial items.
(End of provision)
4. Add section 252.225–70XX to read
as follows:
■
252.225–70XX Representation Regarding
Business Operations with the Maduro
Regime.
5. Add section 252.225–70YY to read
as follows:
■
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Federal Register / Vol. 85, No. 169 / Monday, August 31, 2020 / Proposed Rules
[FR Doc. 2020–18633 Filed 8–28–20; 8:45 am]
allow 30 days for posting of comments
submitted by mail).
BILLING CODE 5001–06–P
FOR FURTHER INFORMATION CONTACT:
(End of clause)
DEPARTMENT OF DEFENSE
SUPPLEMENTARY INFORMATION:
Defense Acquisition Regulations
System
I. Background
48 CFR Parts 227 and 252
[Docket DARS–2019–0048]
RIN 0750–AK71
Defense Federal Acquisition
Regulation Supplement: Validation of
Proprietary and Technical Data
(DFARS Case 2018–D069)
Defense Acquisition
Regulations System, Department of
Defense (DoD).
ACTION: Proposed rule.
AGENCY:
DoD is proposing to amend
the Defense Federal Acquisition
Regulation Supplement (DFARS) to
implement a section of the National
Defense Authorization Act for Fiscal
Year 2019, which amended the statutory
presumption of development
exclusively at private expense for
commercial items in the procedures
governing the validation of asserted
restrictions on technical data.
DATES: Comments on the proposed rule
should be submitted in writing to the
address shown below on or before
October 30, 2020, to be considered in
the formation of a final rule.
ADDRESSES: Submit comments
identified by DFARS Case 2018–D069,
using any of the following methods:
Æ Federal eRulemaking Portal: https://
www.regulations.gov. Search for
‘‘DFARS Case 2018–D069.’’ Select
‘‘Comment Now’’ and follow the
instructions provided to submit a
comment. Please include ‘‘DFARS Case
2018–D069’’ on any attached
documents.
Æ Email: osd.dfars@mail.mil. Include
DFARS Case 2018–D069 in the subject
line of the message.
Æ Fax: 571–372–6094.
Æ Mail: Defense Acquisition
Regulations System, Attn: Ms. Jennifer
D. Johnson, OUSD(A&S)DPC/DARS,
Room 3B941, 3060 Defense Pentagon,
Washington, DC 20301–3060.
Comments received generally will be
posted without change to https://
www.regulations.gov, including any
personal information provided. To
confirm receipt of your comment(s),
please check www.regulations.gov,
approximately two to three days after
submission to verify posting (except
khammond on DSKJM1Z7X2PROD with PROPOSALS
SUMMARY:
VerDate Sep<11>2014
16:36 Aug 28, 2020
Jkt 250001
Ms.
Jennifer D. Johnson, telephone 571–
372–6100.
DoD is proposing to revise the DFARS
to implement section 865 of the
National Defense Authorization Act
(NDAA) for Fiscal Year (FY) 2019 (Pub.
L. 115–232), which repeals several years
of congressional adjustments to the
statutory presumption of development
at private expense for commercial items
in the validation procedures at
paragraph (f) of 10 U.S.C. 2321. DoD
hosted public meetings to obtain the
views of interested parties with notice
published in the Federal Register on
August 16, 2019, at 84 FR 41953. In
addition, DoD published an advance
notice of proposed rulemaking (ANPR)
on September 13, 2019, at 84 FR 48513,
providing draft DFARS revisions and
requesting any written public comments
by November 12, 2019.
The presumption of development
funding at private expense for
commercial items was established in
1994 by section 8106 of the Federal
Acquisition Streamlining Act (FASA)
(Pub. L. 103–355). This statutory
presumption has been amended
numerous times, including by section
802(b) of the NDAA for FY 2007 (Pub.
L. 109–364), section 815(a)(2) of the
NDAA for FY 2008 (Pub. L. 110–181),
section 1071(a)(5) of the NDAA for FY
2015 (Pub. L. 113–291), section 813(a) of
the NDAA for FY 2016 (Pub. L. 114–92),
and most recently by section 865.
The DFARS implementation of this
mandatory presumption has evolved
accordingly to track the statutory
changes, with the primary coverage
found at paragraph (c) of section
227.7103–13, Government right to
review, verify, challenge, and validate
asserted restrictions, and paragraph (b)
of the clause at 252.227–7037,
Validation of Restrictive Markings on
Technical Data. There is no DFARS
coverage applying such a presumption
regarding development funding for
commercial computer software because,
as a matter of policy also dating back to
the FASA time frame, the underlying
procedures for challenging and
validating asserted restrictions have not
been applied to commercial computer
software—only to noncommercial
computer software (e.g., section
227.7203–13, Government right to
review, verify, challenge, and validate
asserted restrictions, and the clause at
PO 00000
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Sfmt 4702
53755
252.227–7019, Validation of Asserted
Restrictions—Computer Software).
II. Discussion and Analysis
DoD reviewed the public comments
submitted in writing, and also as
discussed by the attendees at the public
meeting on November 15, 2019, in the
development of the proposed rule. Only
one respondent provided a written
public comment. A discussion of the
comments and the changes made to the
rule as a result of those comments is
provided, as follows:
A. Summary of Significant Changes
From the ANPR
Language was added to clarify DFARS
227.7103–13(c). The proposed revisions
clarify that the statutory threshold for
all challenges, including those for
commercial items, is that a contracting
officer must have reasonable grounds to
question the validity of the asserted
restriction. In recognition of the higher
burden to sustain a challenge for
commercial items, the text was revised
to require a contracting officer to
include, to the maximum extent
practicable, sufficient information in the
challenge notice to reasonably
demonstrate that the commercial item
was not developed exclusively at
private expense. The proposed revisions
require the contracting officer to
provide, in order to sustain a challenge,
information demonstrating that the
commercial item was not developed
exclusively at private expense.
Additionally, a change to DFARS
227.7103–13(d)(4) is proposed, in the
case of commercial item acquisitions, to
direct the contracting officer to DFARS
227.7103–13, paragraph (c)(2).
Changes were made to 252.227–
7037(b) to clarify that the presumption
of development at private expense for
commercial items applies to the
issuance of a challenge. A revision is
proposed in paragraph (e)(1)(i) of
DFARS 252.227–7037 to clarify that, for
commercial items, the challenge notice
will include, to the maximum extent
practicable, sufficient information to
reasonably demonstrate that the
commercial item was not developed at
private expense. In paragraphs (f) and
(g)(2)(i) of 252.227–7037, revisions are
proposed to explain that, in order to
sustain a challenge for commercial
items, the contracting officer will
provide information demonstrating that
the commercial item was not developed
exclusively at private expense.
B. Analysis of Public Comments
Comment: The respondent requests
two specific changes: (1) A substitution
of language so that a contracting officer
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]]>Agencies
[Federal Register Volume 85, Number 169 (Monday, August 31, 2020)]
[Proposed Rules]
[Pages 53751-53755]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-18633]
-----------------------------------------------------------------------
DEPARTMENT OF DEFENSE
Defense Acquisition Regulations System
48 CFR Parts 212, 225, and 252
[Docket DARS-2020-0031]
RIN 0750-AK97
Defense Federal Acquisition Regulation Supplement: Prohibition on
Contracting With Persons That Have Business Operations With the Maduro
Regime (DFARS Case 2020-D010)
AGENCY: Defense Acquisition Regulations System, Department of Defense
(DoD).
ACTION: Proposed rule.
-----------------------------------------------------------------------
SUMMARY: DoD is proposing to amend the Defense Federal Acquisition
Regulation Supplement (DFARS) to implement a statute that prohibits the
Department of Defense from entering into contracts for the procurement
of goods and services with any person that has business operations with
an authority of the government of Venezuela that is not recognized as
the legitimate government of Venezuela by the United States Government.
DATES: Comments on the proposed rule should be submitted in writing to
the address shown below on or before October 30, 2020, to be considered
in the formation of a final rule.
ADDRESSES: Submit comments identified by DFARS Case 2020-D010, using
any of the following methods:
[cir] Regulations.gov: https://www.regulations.gov. Search for
``DFARS Case 2020-D010'' under the heading ``Enter keyword or ID'' and
selecting ``Search.'' Select ``Comment Now'' and follow the
instructions provided to submit a comment. Please include ``DFARS Case
2020-D010'' on any attached documents.
[cir] Email: [email protected]. Include DFARS Case 2020-D010 in
the subject line of the message.
[cir] Fax: 571-372-6094.
[cir] Mail: Defense Acquisition Regulations System, Attn: Ms.
Kimberly Bass, OUSD(A&S)DPC/DARS, Room 3B941, 3060 Defense Pentagon,
Washington, DC 20301-3060.
Comments received generally will be posted without change to https://www.regulations.gov, including any personal information provided. To
confirm receipt of your comment(s), please check www.regulations.gov,
approximately two to three days after submission to verify posting
(except allow 30 days for posting of comments submitted by mail).
FOR FURTHER INFORMATION CONTACT: Ms. Kimberly Bass, telephone 571-372-
6174.
SUPPLEMENTARY INFORMATION:
I. Background
DoD is proposing to amend the DFARS, to implement section 890 of
the National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2020
(Pub. L. 116-92). Section 890 prohibits contracts for the procurement
of goods and services with any person that has business operations with
an authority of the government of Venezuela that is not recognized as
the legitimate government of Venezuela by the United States Government,
subject to exceptions.
II. Discussion and Analysis
This rule proposes to add section DFARS 225.7019, Prohibition on
Contracting with the Maduro Regime. This section provides to
contracting officers a new solicitation provision and contract clause
for use in solicitations and contracts, including solicitations and
contracts using FAR part 12 procedures for the acquisition of
commercial items, unless an exception applies.
[[Page 53752]]
A. Solicitation Provision and Contract Clause
Per the new solicitation provision, DFARS 252.225-70XX,
Representation Regarding Business Operations with the Maduro Regime, an
offeror represents, by submission of its offer, that the offeror does
not conduct any prohibited business operations with persons or entities
with the Maduro regime or the government of Venezuela, or the offeror
has a valid license to operate in Venezuela issued by the Office of
Foreign Assets Control of the Department of the Treasury. The clause,
DFARS 252.225-70YY, Prohibition Regarding Business Operations with the
Maduro Regime, prohibits DoD contractors from entering into a contract
or subcontract for the procurement of products or services with any
person that has business operations with an authority of the government
of Venezuela that is not recognized as the legitimate government of
Venezuela by the United States Government, subject to the listed
exceptions, as a condition of the contract.
B. Definitions
Definitions are added for the terms ``Agency or instrumentality of
the government of Venezuela,'' ``Business operations,'' ``Government of
Venezuela,'' and ``Person,'' as set out in the regulatory text at the
end of this document.
C. Exceptions
Exceptions to the prohibition are provided to include contracts
that are--
Jointly determined by the Secretary of Defense and the
Secretary of State to be necessary for certain humanitarian or disaster
relief purposes or vital to the national security interests of the
United States;
Related to the operation and maintenance of the United
States Government's consular offices and diplomatic posts in Venezuela;
or
Awarded to a person that has a valid license to operate in
Venezuela issued by the Office of Foreign Assets Control of the
Department of the Treasury, that otherwise would be prohibited.
III. Applicability to Contracts at or Below the Simplified Acquisition
Threshold and for Commercial Items, Including Commercially Available
Off-the-Shelf Items
This rule proposes to create a new provision and a new clause: (1)
DFARS 252.225-70XX, Representation Regarding Business Operations with
the Maduro Regime; and (2) DFARS 252.225-70YY, Prohibition Regarding
Business Operations with the Maduro Regime.
DoD plans to apply the provision and the clause to solicitations,
contracts, or subcontracts below the simplified acquisition threshold
(SAT) and to the acquisition of commercial items, including
commercially available off-the-shelf (COTS) items, as defined at FAR
2.101. This DFARS rule implements section 890 of the NDAA for FY 2020.
Section 890 prohibits contracts for the procurement of goods and
services with any person that has business operations with an authority
of the government of Venezuela, subject to exceptions.
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 simplified acquisition
threshold. 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.
B. Applicability to Contracts for the Acquisition of Commercial Items,
Including COTS Items
10 U.S.C. 2375 exempts contracts and subcontracts for the
acquisition of commercial items (including COTS items) from provisions
of law enacted after October 13, 1994, that, as determined by the Under
Secretary of Defense for Acquisition and Sustainment (USD(A&S)), set
forth policies, procedures, requirements, or restrictions for the
acquisition of property or services unless--
The provision of law--
[cir] Provides for criminal or civil penalties;
[cir] Requires that certain articles be bought from American
sources pursuant to 10 U.S.C. 2533a or that strategic materials
critical to national security be bought from American sources pursuant
to 10 U.S.C. 2533b; or
[cir] Specifically refers to 10 U.S.C. 2375 and states that it
shall apply to contracts and subcontracts for the acquisition of
commercial items (including COTS items); or
USD (A&S) determines in writing that it would not be in
the best interest of the Government to exempt contracts or subcontracts
for the acquisition of commercial items from the applicability of the
provision.
This authority has been delegated to the Principal Director,
Defense Pricing and Contracting.
C. Applicability
Section 890 of the NDAA for FY 2020 is silent on applicability to
contracts and subcontracts in amounts no greater than the SAT or for
the acquisition of commercial items. Also, the statute does not provide
for civil or criminal penalties. Therefore, it does not apply to
contracts or subcontracts in amounts not greater than the SAT or to the
acquisition of commercial items unless the Principal Director, Defense
Pricing and Contracting, makes a written determination as provided in
41 U.S.C. 1905 and 10 U.S.C. 2375.
Not applying this rule to contracts and subcontracts below the SAT
and for the acquisition of commercial items, including COTS items,
would exclude contracts intended to be covered by this rule and
undermine the overarching purpose of the rule to prohibit business
operations with the Maduro Regime with an authority of the government
of Venezuela. This is particularly true with regard to the acquisition
of fuel and petroleum, procurements which are usually commercial items.
To not include the acquisition of fuel and petroleum within this
prohibition or not applying the prohibition below the SAT will
unacceptably diminish the impact of these sanctions on the Maduro
regime, the government of Venezuela that is not recognized by the
United States Government as the legitimate government of Venezuela.
Consequently, DoD plans to apply the rule to contracts and subcontracts
below the SAT and for the acquisition of commercial items, including
COTS items.
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
[[Page 53753]]
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.
V. Executive Order 13771
This rule is not expected to be subject to E.O. 13771, because this
rule is not expected to be significant under E.O. 12866.
VI. Regulatory Flexibility Act
DoD does not expect this proposed rule to have a significant
economic impact on a substantial number of small entities within the
meaning of the Regulatory Flexibility Act, 5 U.S.C. 601, et seq.
Nevertheless, an initial regulatory flexibility analysis has been
performed and summarized as follows:
The rule amends the Defense Federal Acquisition Regulation
Supplement (DFARS) to implement a statute that prohibits contracts for
the procurement of goods and services with any person that has business
operations with an authority of the government of Venezuela, subject to
exceptions.
The objective and legal basis for the rule is to implement section
890 of the National Defense Authorization Act (NDAA) for Fiscal Year
(FY) 2020 which prohibits contracts for the procurement of goods and
services with any person that has business operations with an authority
of the government of Venezuela, subject to exceptions for contracts
that are--
Jointly determined by the Secretary of Defense and the
Secretary of State to be necessary for certain humanitarian or disaster
relief purposes or vital to the national security interests of the
United States;
Related to the operation and maintenance of the United
States Government's consular offices and diplomatic posts in Venezuela;
or
Awarded to a person that has a valid license to operate in
Venezuela issued by the Office of Foreign Assets Control of the
Department of the Treasury, that otherwise would be prohibited.
DoD reviewed the Federal Procurement Data System (FPDS) data for
fiscal years (FY) 2017, 2018, and 2019 (including contracts or
subcontracts that do not exceed the simplified acquisition threshold)
to determine the estimated impact of the rule on U.S. small businesses.
There were no DoD actions reported to FPDS during the period FY 2017
through FY 2019, where the vendor is located in Venezuela or the place
of performance is Venezuela.
It is expected that this rule will not impact small businesses.
This rule does not include any new reporting, recordkeeping, or
other compliance requirements for small businesses. The rule does not
duplicate, overlap, or conflict with any other Federal rules.
There are no known significant alternative approaches to the rule
that would meet the requirements of the statute.
DoD invites comments from small entities concerning the existing
regulations in subparts affected by this rule in accordance with 5
U.S.C. 610. Interested parties must submit such comments separately and
should cite 5 U.S.C. 610 (DFARS Case 2020-D010), in correspondence.
VII. Paperwork Reduction Act
The 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).
List of Subjects in 48 CFR Parts 212, 225, and 252
Government procurement.
Jennifer Lee Hawes,
Regulatory Control Officer, Defense Acquisition Regulations System.
Therefore, 48 CFR parts 212, 225, and 252 are proposed to be
amended as follows:
0
1. The authority citation for 48 CFR parts 212, 225, and 252 continues
to read as follows:
Authority: 41 U.S.C. 1303 and 48 CFR chapter 1.
PART 212--ACQUISITION OF COMMERCIAL ITEMS
0
2. Amend section 212.301 by adding paragraphs (f)(ix)(GG) and (HH) to
read as follows:
212.301 Solicitation provisions and contract clauses for the
acquisition of commercial items.
* * * * *
(f) * * *
(ix) * * *
(GG) Use the provision at 252.225-70XX, Representation Regarding
Business Operations with the Maduro Regime, as prescribed in 225.7019-
5(a), to comply with section 890 of the National Defense Authorization
Act for Fiscal Year 2020 (Pub. L. 116-92).
(HH) Use the clause at 252.225-70YY, Prohibition Regarding Business
Operations with the Maduro Regime, as prescribed in 225.7019-5(b), to
comply with section 890 of the National Defense Authorization Act for
Fiscal Year 2020 (Pub. L. 116-92).
* * * * *
PART 225--FOREIGN ACQUISITION
0
3. Add sections 225.7019, 225.7019-1, 225.7019-2, 225.7019-3, 225.7019-
4, and 225.7019-5 to subpart 225.70 to read as follows:
* * * * *
Sec.
225.7019 Prohibition on contracting with the Maduro regime.
225.7019-1 Definitions.
225.7019-2 Prohibition.
225.7019-3 Exceptions.
225.7019-4 Joint determination.
225.7019-5 Solicitation provision and contract clause.
* * * * *
225.7019 Prohibition on contracting with the Maduro regime.
225.7019-1 Definitions.
As used in this section--
Agency or instrumentality of the government of Venezuela means an
agency or instrumentality of a foreign state as defined in section 28
U.S.C. 1603(b), with each reference in such section to a foreign state
deemed to be a reference to Venezuela.
Business operations means engaging in commerce in any form,
including acquiring, developing, maintaining, owning, selling,
possessing, leasing, or operating equipment, facilities, personnel,
products, services, personal property, real property, or any other
apparatus of business or commerce.
Government of Venezuela means the government of any political
subdivision of Venezuela, and any agency or instrumentality of the
government of Venezuela.
Person means--
(1) A natural person, corporation, company, business association,
partnership, society, trust, or any other nongovernmental entity,
organization, or group;
(2) Any governmental entity or instrumentality of a government,
including a multilateral development institution (as defined in section
1701(c)(3) of the International Financial Institutions Act (22 U.S.C.
262r(c)(3)); and
(3) Any successor, subunit, parent entity, or subsidiary of, or any
entity under common ownership or control with, any entity described in
paragraph (1) or (2) of this definition.
225.7019-2 Prohibition.
In accordance with section 890 of the National Defense
Authorization Act for Fiscal Year 2020 (Pub. L. 116-92), DoD
[[Page 53754]]
is prohibited from entering into a contract for the procurement of
products or services with any person that has business operations with
an authority of the government of Venezuela that is not recognized as
the legitimate government of Venezuela by the United States Government,
except as provided in 225.7019-3 or 225.7019-4.
225.7019-3 Exceptions.
The prohibition in 225.7019-2 does not apply if--
(a) The person has a valid license to operate in Venezuela issued
by the Office of Foreign Assets Control of the Department of the
Treasury; or
(b) The acquisition is related to the operation and maintenance of
the United States Government's consular office and diplomatic posts in
Venezuela.
225.7019-4 Joint determination.
(a) The prohibition in section 225.7019-2 does not apply to an
acquisition jointly determined by the Secretary of Defense and
Secretary of State to be--
(1) Necessary for purposes of--
(i) Providing humanitarian assistance to the people of Venezuela;
(ii) Disaster relief and other urgent lifesaving measures; or
(iii) Carrying out noncombatant evacuations; or
(2) Vital to the national security interests of the United States.
(b) Follow the procedures at PGI 225.7019-4(b) when entering into a
contract on the basis of a joint determination.
225.7019-5 Solicitation provision and contract clause.
(a) Use the provision at 252.225-70XX, Representation Regarding
Business Operations with the Maduro Regime, in solicitations that
include the clause at 252.225-70YY, Prohibition Regarding Business
Operations with the Maduro Regime, including solicitations using FAR
part 12 procedures for the acquisition of commercial items.
(b) Unless an exception at 225.7019-3 applies or a joint
determination has been made in accordance with 225.7019-4, use the
clause at 252.225-70YY, Prohibition Regarding Business Operations with
the Maduro Regime, in solicitations and contracts, including
solicitations and contracts using FAR part 12 procedures for the
acquisition of commercial items.
PART 252--SOLICITATION PROVISIONS AND CONTRACT CLAUSES
0
4. Add section 252.225-70XX to read as follows:
252.225-70XX Representation Regarding Business Operations with the
Maduro Regime.
As prescribed in 225.7019-5(a), use the following provision:
REPRESENTATION REGARDING BUSINESS OPERATIONS WITH THE MADURO REGIME
(DATE)
(a) Definitions. As used in this provision--
Agency or instrumentality of the government of Venezuela means
an agency or instrumentality of a foreign state as defined in
section 28 U.S.C. 1603(b), with each reference in such section to a
foreign state deemed to be a reference to Venezuela.
Business operations means engaging in commerce in any form,
including acquiring, developing, maintaining, owning, selling,
possessing, leasing, or operating equipment, facilities, personnel,
products, services, personal property, real property, or any other
apparatus of business or commerce.
Government of Venezuela means the government of any political
subdivision of Venezuela, and any agency or instrumentality of the
government of Venezuela.
Person means--
(1) A natural person, corporation, company, business
association, partnership, society, trust, or any other
nongovernmental entity, organization, or group;
(2) Any governmental entity or instrumentality of a government,
including a multilateral development institution (as defined in
section 1701(c)(3) of the International Financial Institutions Act
(22 U.S.C. 262r(c)(3)); and
(3) Any successor, subunit, parent entity, or subsidiary of, or
any entity under common ownership or control with, any entity
described in paragraph (1) or (2) of this definition.
(b) Prohibition. In accordance with section 890 of the National
Defense Authorization Act for Fiscal Year 2020 (Pub. L. 116-92), DoD
is prohibited from entering into a contract for the procurement of
products or services with any person that has business operations
with an authority of the government of Venezuela that is not
recognized as the legitimate government of Venezuela by the United
States Government, unless the person has a valid license to operate
in Venezuela issued by the Office of Foreign Assets Control of the
Department of the Treasury.
(c) Representation. By submission of its offer, the Offeror
represents that the Offeror--
(1) Does not have any business operations with an authority of
the Maduro regime or the government of Venezuela that is not
recognized as the legitimate government of Venezuela by the United
States Government; or
(2) Has a valid license to operate in Venezuela issued by the
Office of Foreign Assets Control of the Department of the Treasury.
(End of provision)
0
5. Add section 252.225-70YY to read as follows:
252.225-70YY Prohibition Regarding Business Operations with the Maduro
Regime.
As prescribed in 225.7019-5(b), use the following clause:
PROHIBITION REGARDING BUSINESS OPERATIONS WITH THE MADURO REGIME (DATE)
(a) Definitions. As used in this clause--
Agency or instrumentality of the government of Venezuela means
an agency or instrumentality of a foreign state as defined in
section 28 U.S.C. 1603(b), with each reference in such section to a
foreign state deemed to be a reference to Venezuela.
Business operations means engaging in commerce in any form,
including acquiring, developing, maintaining, owning, selling,
possessing, leasing, or operating equipment, facilities, personnel,
products, services, personal property, real property, or any other
apparatus of business or commerce.
Government of Venezuela means the government of any political
subdivision of Venezuela, and any agency or instrumentality of the
government of Venezuela.
Person means--
(1) A natural person, corporation, company, business
association, partnership, society, trust, or any other
nongovernmental entity, organization, or group;
(2) Any governmental entity or instrumentality of a government,
including a multilateral development institution (as defined in
section 1701(c)(3) of the International Financial Institutions Act
(22 U.S.C. 262r(c)(3)); and
(3) Any successor, subunit, parent entity, or subsidiary of, or
any entity under common ownership or control with, any entity
described in paragraph (1) or (2) of this definition.
(b) Prohibition. In accordance with section 890 of the National
Defense Authorization Act for Fiscal Year 2020 (Pub. L. 116-92), DoD
is prohibited from entering into a contract for the procurement of
products or services with any person that has business operations
with an authority of the government of Venezuela that is not
recognized as the legitimate government of Venezuela by the United
States Government, unless the person has a valid license to operate
in Venezuela issued by the Office of Foreign Assets Control of the
Department of the Treasury.
(c) The Contractor shall--
(1) Not have any business operations with an authority of the
Maduro regime or the government of Venezuela that is not recognized
as the legitimate government of Venezuela by the United States
Government; or
(2) Have a valid license to operate in Venezuela issued by the
Office of Foreign Assets Control of the Department of the Treasury.
(d) Subcontracts. The Contractor shall insert the substance of
this clause, including this paragraph (d), in all subcontracts,
including subcontracts for the acquisition of commercial items.
[[Page 53755]]
(End of clause)
[FR Doc. 2020-18633 Filed 8-28-20; 8:45 am]
BILLING CODE 5001-06-P
