Defense Federal Acquisition Regulation Supplement: Use of Supplier Performance Risk System (SPRS) Assessments (DFARS Case 2019-D009), 17336-17340 [2023-05671]
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Federal Register / Vol. 88, No. 55 / Wednesday, March 22, 2023 / Rules and Regulations
DEPARTMENT OF DEFENSE
final rule as discussed in paragraph C of
this preamble.
Defense Acquisition Regulations
System
B. Analysis of Public Comments
48 CFR Parts 204, 208, 209, 212, 213,
215, 216, and 252
[Docket DARS–2020–0027]
RIN 0750–AK44
Defense Federal Acquisition
Regulation Supplement: Use of
Supplier Performance Risk System
(SPRS) Assessments (DFARS Case
2019–D009)
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 update the policy and
procedures for use of the Supplier
Performance Risk System and to require
contracting officers to consider SPRS
risk assessments, if available, in the
evaluation of a supplier’s quotation or
offer and to consider SPRS supplier risk
assessments when determining
contractor responsibility.
DATES: Effective March 22, 2023.
FOR FURTHER INFORMATION CONTACT:
Heather Kitchens, telephone 571–296–
7152.
SUMMARY:
SUPPLEMENTARY INFORMATION:
I. Background
DoD published a proposed rule in the
Federal Register at 85 FR 53748 on
August 31, 2020, to amend the DFARS
to require contracting officers to
consider Supplier Performance Risk
System (SPRS) risk assessments during
evaluation of quotations or offers and to
consider the SPRS supplier risk
assessment in the evaluation of
contractor responsibility. Two
respondents submitted public
comments in response to the proposed
rule.
II. Discussion and Analysis
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DoD reviewed the public comments in
the development of the final rule. 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 Proposed Rule
As a result of public comments, there
are changes from the proposed rule in
the final rule to clarify applicability of
the rule. Additionally, editorial and
clarifying changes were made in the
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a. Solicitation Provision Applicability
Comment: One respondent
commented that the prescription for
solicitation provision 252.204–70XX,
Notice to Prospective Suppliers on the
Use of the Supplier Performance Risk
System in Performance Evaluations,
should be updated at DFARS 204.7X04
to state that the provision is for use in
solicitations using FAR part 13
simplified acquisition procedures,
including solicitations for supplies and
services using FAR part 12 procedures
for the acquisition of commercial items,
to align with DFARS 204.7X02,
Applicability.
Response: The final rule revises
DFARS 204.7602, Applicability, to align
with the solicitation provision
prescription at DFARS 204.7604 and the
stated intent of the rule to move the
coverage from part 213 to a new subpart
204.76, as described in the preamble of
the proposed rule. Section 204.7602
states that use of SPRS risk assessments
is required for the evaluation of
quotations or offers in response to
solicitations for supplies and services,
including solicitations using FAR part
12 procedures for the acquisition of
commercial products and commercial
services. DFARS 204.7602, as revised,
does not limit applicability of use of
SPRS risk assessments to acquisitions
using FAR part 13 simplified
acquisition procedures; therefore, the
recommended change to the solicitation
provision prescription at DFARS
204.7604 will not be made.
The solicitation provision is
prescribed for use in solicitations for
supplies and services, including
solicitations using FAR part 12
procedures for the acquisition of
commercial products and commercial
services. To clarify that the provision
also applies to solicitations using FAR
part 13 simplified acquisition
procedures, the rule revises the
language in part 213 at 213.106–2,
paragraph (b)(i), to provide a crossreference to 204.7603 and to require
contracting officers to consider SPRS
risk assessments as a basis of award for
solicitations using FAR part 13
simplified acquisition procedures, and
obsolete language is removed. Further,
to more clearly reflect that the intended
purpose of the provision extends
beyond FAR part 13 actions, the
provision title is revised to read as
follows: 252.204–7024, Notice on the
Use of the Supplier Performance Risk
System.
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The proposed rule, at sections I. and
II. of the preamble, stated that SPRS is
required to be used to evaluate quotes
and offers received under all
solicitations for supplies and services.
To further clarify applicability of the
procedures at DFARS 204.7603 to
Federal Supply Schedules, commercial
acquisitions, acquisitions using FAR
part 13 simplified acquisition
procedures, evaluation of offers under
part 215, and indefinite-delivery
contracts, cross-references to DFARS
204.7603 are added to—
• Subpart 208.4, Federal Supply
Schedules;
• Subpart 212.2, Special
Requirements for the Acquisition of
Commercial Products and Commercial
Services;
• Subpart 213.1, Procedures;
• 215.3, Source Selection; and
• Subpart 216.5, Indefinite-Delivery
Contracts.
b. SPRS Website
Comment: One respondent
commented that Government-Industry
Data Exchange Program (GIDEP) alerts
are not appropriate measures of quality
performance and such data cannot be
accurately translated into meaningful
risk scores without dissecting each
GIDEP report, including supplier letters
and enclosures.
Response: GIDEP alerts are only used
if they are Government-generated
(Agency Action Notice) with a
Commercial and Government Entity
(CAGE) code reported explicitly for
Suspected Counterfeit or Failure
Experience. SPRS does not search
GIDEP narratives or text. It only
searches for data indicating that the
item has been identified as suspected
counterfeit or has been determined to be
a material failure.
Comment: One respondent
commented that Mechanization of
Contact Administration Services
(MOCAS) is not specifically intended to
measure on-time delivery performance
and will require substantial investment
by industry and DoD buying commands
to maintain its accuracy and reliability.
Response: SPRS only uses MOCAS
records that provide a specific
contractor’s Commercial and
Government Entity (CAGE) code,
product service code (PSC), and a
required delivery date on a contract line
item that can be matched to an actual
delivery date. This constrained usage
mitigates the concerns the respondent
identified.
Comment: One respondent
commented that the SPRS system itself
may not be able to handle the
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administrative and logistical challenges
that will arise under its expanded use.
Response: DoD does not expect any
issues with increased user traffic as a
result of this rule. SPRS has recently
experienced a rapid increase in user
activity without any system impacts.
Publication of this rule will not
adversely impact operation of the
system or the program office.
C. Other Changes
The following are amplifying changes
to the rule that are not based on public
comments, but were made to add
clarity:
• The term ‘‘overall risk assessments’’
at DFARS 204.7602 and 204.7603 was
changed to ‘‘risk assessments’’
throughout the final rule to use language
consistent with the SPRS website.
• Some instances of the terms
‘‘evaluated’’ and ‘‘evaluation’’ were
replaced with the term ‘‘considered’’
and ‘‘shall consider’’ to clarify that risk
assessments are not a mandatory, standalone, evaluation factor for source
selections and that the contracting
officer shall ‘‘consider’’ the risk
assessments, if available, as part of
broader evaluation factors during
evaluation of quotations or offers and
when determining contractor
responsibility.
• DFARS 204.7603, Procedures, was
updated to clarify the scope of SPRS
risk assessments required to be
considered when procuring supplies
and services and the scope of SPRS risk
assessments required to be considered
when procuring an end product (see
FAR 2.101) identified by an available
material identifier (see Procedures,
Guidance, and Information (PGI)
204.7603). The contracting officer shall
consider price risk and supplier risk, if
available, as part of the award decision.
For the procurement of an end product
identified by an available material
identifier, the contracting officer shall
also consider item risk.
• DFARS 204.7603, Procedures, was
updated to clarify that contracting
officers shall use their discretion in
considering the information available in
SPRS.
• DFARS 204.7603, Procedures, was
updated under paragraph (a), Item Risk,
to clarify that a SPRS item risk search
is required for any end product that did
not have an item risk search performed
prior to solicitation to ensure that item
risk searches in SPRS only occur if an
end product did not have an item risk
search performed prior to solicitation;
and paragraph (b), Price Risk, applies
when procuring a service or an end
product identified by an available
material identifier.
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• An editorial change was made
throughout to correct an administrative
error by removing the words ‘‘or
services’’ from the definition of ‘‘item
risk’’, as item risk does not apply to
services.
III. Applicability to Contracts at or
Below the Simplified Acquisition
Threshold, for Commercial Services,
and for Commercial Products,
Including Commercially Available Offthe-Shelf Items
This rule creates a new solicitation
provision, DFARS 252.204–7024, Notice
on the Use of the Supplier Performance
Risk System. The provision at DFARS
252.204–7024 is prescribed at DFARS
204.7604 for use in in solicitations for
supplies and services, including
solicitations using FAR part 12
procedures for the acquisition of
commercial products and commercial
services. The provision is applicable to
acquisitions at or below the simplified
acquisition threshold (SAT) and to
acquisitions of commercial products,
including commercially available offthe-shelf (COTS) items, and commercial
services. Not applying this provision to
contracts at or below the SAT and for
the acquisition of commercial products,
including COTS items, and commercial
services would exclude contracts
intended to be covered by this rule and
undermine the overarching purpose of
the rule. Consequently, DoD is applying
the rule to contracts below the SAT, for
the acquisition of commercial services,
and for the acquisition of commercial
products, 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
subject to review under section 6(b) of
E.O. 12866, Regulatory Planning and
Review, dated September 30, 1993.
V. Congressional Review Act
As required by the Congressional
Review Act (5 U.S.C. 801–808) before an
interim or final rule takes effect, DoD
will submit a copy of the interim or
final rule with the form, Submission of
Federal Rules under the Congressional
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Review Act, to the U.S. Senate, the U.S.
House of Representatives, and the
Comptroller General of the United
States. A major rule under the
Congressional Review Act cannot take
effect until 60 days after it is published
in the Federal Register. The Office of
Information and Regulatory Affairs has
determined that this rule is not a major
rule as defined by 5 U.S.C. 804.
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 is necessary to revise
the Defense Federal Acquisition
Regulation Supplement (DFARS) to
incorporate the expanded capabilities of
the Supplier Performance Risk System
(SPRS), made possible by recent
technical enhancements. SPRS is a DoD
enterprise application that retrieves
price, item, quality, delivery, and
contractor performance data from
Government reporting systems. SPRS
collects quality and delivery data from
Government systems to develop risk
assessments. The system provides three
risk assessments for contracting officer
use in evaluations of quotations and
offers: an item risk assessment, a price
risk assessment, and a supplier risk
assessment.
The objective of the final rule is to
notify offerors, via the new solicitation
provision at DFARS 252.204–7024, that
SPRS collects performance data from a
variety of Government sources on
awarded contracts to develop item risk,
price risk, and supplier risk assessments
for contracting officers to consider
during evaluation of quotations or
offers. The final rule also requires
contracting officers to consider the
supplier risk assessment in the
determination of contractor
responsibility.
No comments were received in
response to the initial regulatory
flexibility analysis.
The Federal Procurement Data System
indicates that in fiscal years 2020
through 2022, DoD awarded an average
of 483,364 contracts per year for both
products and services, of which an
average of 338,039 (approximately 70
percent) were awarded to an average of
22,760 unique small businesses.
This rule does not require any specific
reporting, recordkeeping, or compliance
requirements.
No significant economic impact on
small businesses is anticipated as a
result of the final rule. DoD does not
expect small entities will be materially
affected by this rule. There are no
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204.7602
known significant alternatives to the
rule.
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 204,
208, 209, 212, 213, 215, 216, and 252
Government procurement.
Jennifer D. Johnson,
Editor/Publisher, Defense Acquisition
Regulations System.
Therefore, 48 CFR parts 204, 208, 209,
212, 213, 215, 216, and 252 are
amended as follows:
1. The authority citation for 48 CFR
parts 204, 208, 209, 212, 213, 215, 216,
and 252 continues to read as follows:
■
Authority: 41 U.S.C. 1303 and 48 CFR
chapter 1.
PART 204—ADMINISTRATIVE AND
INFORMATION MATTERS
2. Add subpart 204.76 to read as
follows:
■
Subpart 204.76—Supplier Performance Risk
System
204.7600 Scope of subpart.
204.7601 Definitions.
204.7602 Applicability.
204.7603 Procedures.
204.7604 Solicitation provision.
Subpart 204.76—Supplier Performance
Risk System
204.7600
Scope of subpart.
This subpart provides policies and
procedures for use of the Supplier
Performance Risk System (SPRS) risk
assessments in the evaluation of a
quotation or offer.
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204.7601
Definitions.
As used in this subpart—
Item risk means the probability that a
product, based on intended use, will
introduce performance risk resulting in
safety issues, mission degradation, or
monetary loss.
Price risk means the 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 may subject the
procurement to the risk of unsuccessful
performance or to supply chain risk (see
239.7301).
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Applicability.
Use of SPRS risk assessments is
required for the evaluation of quotations
or offers in response to solicitations for
supplies and services, including
solicitations using FAR part 12
procedures for the acquisition of
commercial products and commercial
services, excluding solicitations for the
procurement of supplies or services
exempted by the Department of Defense
Instruction (DoDI) 5000.79, Defensewide Sharing and Use of Supplier and
Product Performance Information. SPRS
retrieves item, price, quality, delivery,
and contractor information from
contracts in Government reporting
systems in order to develop risk
assessments of contractors. SPRS is
available at https://piee.eb.mil/, and the
SPRS user’s guides are available at
https://www.sprs.csd.disa.mil/
reference.htm.
204.7603
Procedures.
The contracting officer shall consider
price risk and supplier risk, if available
in SPRS, as a part of the award decision.
For procurement of an end product
identified by a material identifier that is
available as described at PGI 204.7603,
the contracting officer shall also
consider assessments of item risk, if
available, as a part of the award
decision. Offerors or quoters without a
risk assessment in SPRS shall not be
considered favorably or unfavorably.
Contracting officers shall use their
discretion in considering the
information available in SPRS on item
risk, price risk, and supplier risk as
follows:
(a) Item risk. (1) Consider item risk to
determine whether the procurement of
products represents a high performance
risk to the Government. If an item has
a high risk rating, then the SPRS item
risk report will display the reason(s) an
item is identified as high risk.
(2) Before issuing a solicitation for the
procurement of an end product
identified by a material identifier that is
available as described at PGI 204.7603,
the contracting officer shall ensure a
SPRS item risk search has been
performed and shall consider any item
risk warnings provided. When
evaluating quotations or offers for an
end product identified by a material
identifier, a SPRS item risk search is
required for any end product that did
not have an item risk search performed
prior to solicitation. If there are item
risk warnings, the contracting officer
shall consider strategies to mitigate risk,
such as the following:
(i) Consulting with the program office.
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(ii) Including mitigating requirements
in the statement of work, as provided by
the requiring activity.
(iii) Including FAR and DFARS
clauses identified in the SPRS
application, as appropriate.
(b) Price risk. (1) When procuring a
service or an end product identified by
a material identifier that is available as
described at PGI 204.7603, the
contracting officer shall consider price
risk assessment in determining if a
proposed price is consistent with
historical prices paid for an item or
otherwise creates a risk to the
Government. Contracting officers shall
not rely solely on the price risk
assessment when determining prices to
be fair and reasonable.
(2) The contracting officer shall
consider strategies to mitigate price risk,
such as the following:
(i) Not awarding to offerors or quoters
with high risk price ratings unless there
is a way to justify the price through
additional price or cost analysis.
(ii) Utilizing appropriate price
negotiation techniques and procedures.
(iii) Using price reasonableness or
price realism techniques at FAR 13.106
or 15.4. See also 215.403–3 when
making award decisions.
(c) Supplier risk. The contracting
officer shall consider supplier risk, to
assess the risk of unsuccessful
performance and supply chain risk, in
award decisions. Supplier risk
assessments in SPRS include quality,
delivery, and other contractor
performance information.
204.7604
Solicitation provision.
Except for supplies or services
exempted by DoDI 5000.79, use the
provision at 252.204–7024, Notice on
the Use of the Supplier Performance
Risk System, in solicitations for
supplies and services, including
solicitations using FAR part 12
procedures for the acquisition of
commercial products and commercial
services.
PART 208—REQUIRED SOURCES OF
SUPPLIES AND SERVICES
3. Amend section 208.405 by adding
paragraph (4) to read as follows:
■
208.405 Ordering procedures for Federal
Supply Schedules.
*
*
*
*
*
(4) See 204.7603 for procedures on the
required use of the Supplier
Performance Risk System (SPRS) risk
assessments.
(i) The contracting officer shall ensure
SPRS assessments of price risk and
supplier risk are considered as a part of
the award decision.
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(ii) When placing an order with a
schedule contractor for an end product
identified by a material identifier that is
available as described at PGI 204.7603,
and item risk was not previously
considered during award of the
schedule contract, the contracting
officer shall also consider SPRS
assessments of item risk in the award
decision.
(iii) Use the provision at 252.204–
7024, Notice on the Use of the Supplier
Performance Risk System, as prescribed
in 204.7604 to the extent permitted by
the Federal Supply Schedule.
212.301 Solicitation provisions and
contract clauses for the acquisition of
commercial products and commercial
services.
PART 209—CONTRACTOR
QUALIFICATIONS
■
4. Amend section 209.105–1 by
revising paragraph (2) to read as follows:
Obtaining information.
*
*
*
*
*
(2) A satisfactory performance record
is a factor in determining contractor
responsibility (see FAR 9.104–1(c)).
(i) One source of information relating
to contractor performance is the
Contractor Performance Assessment
Reporting System (CPARS), available at
https://www.cpars.gov/.
(ii) Information relating to contract
terminations for cause and for default is
also available through the Federal
Awardee Performance and Integrity
Information System (FAPIIS) module of
CPARS, available at https://sam.gov (see
FAR subpart 42.15). This termination
information is just one consideration in
determining contractor responsibility.
(iii) Contracting officers shall consider
the supplier risk assessment available in
the Supplier Performance Risk System
at https://piee.eb.mil/ when determining
responsibility. See 204.7603(c).
PART 212—ACQUISITION OF
COMMERCIAL PRODUCTS AND
COMMERCIAL SERVICES
5. Amend section 212.203 by adding
paragraph (3) to read as follows:
■
212.203 Procedures for solicitation,
evaluation, and award.
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*
*
*
*
*
(3) See 204.7603 for procedures on the
required use of Supplier Performance
Risk System risk assessments as part of
the award decision.
■ 6. Amend section 212.301 by—
■ a. Adding paragraph (f)(ii)(O);
■ b. Removing paragraph (f)(v); and
■ c. Redesignating paragraphs (f)(vi)
through (xx) as paragraphs (f)(v) through
(xix).
The addition reads as follows:
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*
*
*
*
(f) * * *
(ii) * * *
(O) Use the provision at 252.204–
7024, Notice on the Use of the Supplier
Performance Risk System, as prescribed
in 204.7604.
*
*
*
*
*
PART 213—SIMPLIFIED ACQUISITION
PROCEDURES
7. Revise section 213.106–2 to read as
follows:
■
209.105–1
*
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213.106–2
offers.
Evaluation of quotations or
(b)(i) See 204.7603 for procedures on
the requirement for contracting officers
to consider Supplier Performance Risk
System risk assessments as a basis of
award.
■ 8. Revise section 213.106–2–70 to
read as follows:
213.106–2–70
Solicitation provision.
Use the provision at 252.204–7024,
Notice on the Use of the Supplier
Performance Risk System, as prescribed
in 204.7604.
PART 215—CONTRACTING BY
NEGOTIATION
determining if a proposed price is
consistent with historical prices paid for
an item or otherwise creates a risk to the
Government. See also 215.403–3(a)(1).
*
*
*
*
*
PART 216—TYPES OF CONTRACTS
11. Amend section 216.505 by adding
paragraph (a)(S–71) to read as follows:
■
216.505
Ordering.
(a) * * *
(S–71) See 204.7603 for procedures on
the required use of the Supplier
Performance Risk System (SPRS) risk
assessments.
(i) The contracting officer shall ensure
SPRS assessments of price risk and
supplier risk are considered as a part of
the award decision.
(ii) When placing an order for an end
product identified by a material
identifier that is available as described
at PGI 204.7603, and item risk was not
previously considered during award of
the contract, the contracting officer shall
also consider SPRS assessments of item
risk in the award decision.
(iii) Use the provision at 252.204–
7024, Notice on the Use of the Supplier
Performance Risk System, as prescribed
in 204.7604 to the extent permitted by
the contract.
*
*
*
*
*
■
PART 252—SOLICITATION
PROVISIONS AND CONTRACT
CLAUSES
215.304 Evaluation factors and significant
subfactors.
■
9. Amend section 215.304 by adding
paragraph (c)(viii) to read as follows:
(c) * * *
(viii)(A) When procuring supplies or
services, the contracting officer shall
ensure Supplier Performance Risk
System (SPRS) assessments of price risk
and supplier risk are considered as a
part of the award decision. See
204.7603.
(B) When procuring an end product
identified by a material identifier that is
available as described at PGI 204.7603,
the contracting officer shall also
consider SPRS assessments of item risk
in the award decision.
■ 10. Amend section 215.404–1 by
adding paragraph (b)(viii) to read as
follows:
215.404–1
Proposal analysis techniques.
*
*
*
*
*
(b) * * *
(viii) When procuring a service or an
end product identified by a material
identifier that is available as described
at PGI 204.7603, the contracting officer
shall consider the Supplier Performance
Risk System price risk assessments in
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12. Add section 252.204–7024 to read
as follows:
252.204–7024 Notice on the Use of the
Supplier Performance Risk System.
As prescribed in 204.7604, use the
following provision:
Notice on the Use of the Supplier
Performance Risk System (Mar 2023)
(a) Definitions. As used in this provision—
Item risk means the probability that a
product, 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 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://piee.eb.mil/, will
be used in the evaluation of the Quoter or
Offeror’s performance. SPRS retrieves item,
price, quality, delivery, and contractor
information on contracts from Government
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reporting systems in order to develop risk
assessments.
(c) The Contracting Officer will consider
SPRS risk assessments during the evaluation
of quotations or offers received in response
to this solicitation as follows:
(1) Item risk will be considered to
determine whether the procurement
represents a high performance risk to the
Government.
(2) Price risk will be considered in
determining if a proposed price is consistent
with historical prices paid for a product or
a service or otherwise creates a risk to the
Government.
(3) Supplier risk, including but not limited
to quality and delivery, will be considered to
assess the risk of unsuccessful performance
and supply chain risk.
(d) SPRS risk assessments are generated
daily. Quoters or Offerors are able to access
their risk assessments by following the access
instructions in the SPRS user’s guide
available at https://www.sprs.csd.disa.mil/
reference.htm. Quoters and Offerors 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 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)
252.213–7000
[Removed and Reserved]
13. Remove and reserve section
252.213–7000.
■
[FR Doc. 2023–05671 Filed 3–21–23; 8:45 am]
BILLING CODE 5001–06–P
DEPARTMENT OF DEFENSE
Defense Acquisition Regulations
System
48 CFR Parts 227, 237, 239, and 252
[Docket DARS–2019–0067]
RIN 0750–AK87
Defense Federal Acquisition
Regulation Supplement:
Noncommercial Computer Software
(DFARS Case 2018–D018)
Defense Acquisition
Regulations System, Department of
Defense (DoD).
ACTION: Final rule.
lotter on DSK11XQN23PROD with RULES2
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 2018.
DATES: Effective March 22, 2023.
SUMMARY:
VerDate Sep<11>2014
17:56 Mar 21, 2023
Jkt 259001
FOR FURTHER INFORMATION CONTACT:
Mr.
David E. Johnson, telephone 202–913–
5764.
SUPPLEMENTARY INFORMATION:
computer software and other rights to
computer software already provided to
covered Government support
contractors.
I. Background
DoD published a proposed rule in the
Federal Register at 87 FR 4546 on
January 28, 2022, to implement section
871 of the National Defense
Authorization Act (NDAA) for Fiscal
Year (FY) 2018 (Pub. L. 115–91). Section
871 established new direction at 10
U.S.C. 4576 (formerly 10 U.S.C. 2322a),
Requirement for consideration of certain
matters during acquisition of
noncommercial computer software. The
statute requires that DoD, as part of any
negotiation for such software, consider
all noncommercial computer software
and related materials necessary to meet
the needs of the agency throughout the
life cycle of the software. This rule
provides direction to DoD both to
improve acquisition planning and to
identify and negotiate for software
deliverables and license rights at a fair
and reasonable price before contract
award. Eight respondents submitted
public comments in response to the
proposed rule. DoD also held a public
meeting on March 10, 2022.
B. Analysis of Public Comments
II. Discussion and Analysis
DoD reviewed the public comments in
the development of the final rule. 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 Proposed Rule
Based on comments received, DFARS
227.7203–2 and the clauses at DFARS
252.227–7014 and 252.227–7018 are
revised as follows:
• DFARS 227.7203–2(c)(6)(ii)(A) and
(B) and 227.7203–2(c)(6)(iii) are revised
to state ‘‘license rights sufficient to meet
the Government’s needs’’, rather than
‘‘all necessary license rights.’’
• The list of factors in DFARS
227.7203–2(b)(1)(ii) is revised to include
the Government’s costs to develop
computer software.
• Paragraph (iii) of the definition of
‘‘restricted rights’’ in DFARS 252.227–
7014 and 252.227–7018 is revised to
remove the purposes added in the
proposed rule and to permit the
Government to make a reasonable
number of copies of computer software
required for the other purposes
authorized under the clause.
• Paragraphs (v) through (vii) of the
definition of the of ‘‘restricted rights’’ in
DFARS 252.227–7014 and 252.227–
7018 are revised to expressly indicate
that the Government has the right to use
PO 00000
Frm 00006
Fmt 4701
Sfmt 4700
1. Areas of Alignment With Industry
Comment: One of the respondents
noted several areas of alignment
between DoD and industry in the
proposed rule, including: (1) removal of
the definition of the term ‘‘data’’; (2)
consideration of development at private
expense; (3) consideration of
alternatives to the formal delivery of
source code and software design details;
and (4) conformance of the DFARS
definition of ‘‘technical data’’ to the
statutory definition at 10 U.S.C. 3013
(formerly 10 U.S.C. 2302).
Response: DoD acknowledges the
respondent’s comments.
2. Application to Commercial Computer
Software
Comment: Several respondents
asserted that a plain language
interpretation of 10 U.S.C. 4576
demonstrates that Congress intended for
the provision to apply to only
noncommercial computer software.
Based on this interpretation, the
respondents asserted that the proposed
rule should not apply to commercial
software, contrary to DoD’s proposed
revisions in DFARS 227.7202–1(d). The
respondents also asserted that
application of the proposed rule to
commercial software is detrimental to
the availability of commercial software,
creates a barrier for nontraditional
contractors, and is inconsistent with the
commercial software industry’s
licensing models. Several respondents
also asserted that the term ‘‘all
necessary license rights’’ in DFARS
227.7203–2(b)(6)(ii)(A) and (B) may be
improperly applied to commercial
software or misconstrued to mean a
government purpose rights license or an
unlimited rights license.
Response: DoD acknowledges that 10
U.S.C. 4576 includes express references
to noncommercial software and
therefore must apply to noncommercial
software. However, the statute does not
prohibit the prescribed consideration of
the Government’s life-cycle needs from
applying to negotiations for commercial
software. Contrary to the respondents’
interpretation, paragraph (a) of the
statute directs the Government to
consider the acquisition of ‘‘all
software’’ and ‘‘related materials’’
necessary to satisfy the Government’s
needs for certain activities throughout
the life cycle of the noncommercial
software being acquired, without any
E:\FR\FM\22MRR2.SGM
22MRR2
]]>Agencies
[Federal Register Volume 88, Number 55 (Wednesday, March 22, 2023)]
[Rules and Regulations]
[Pages 17336-17340]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-05671]
[[Page 17335]]
Vol. 88
Wednesday,
No. 55
March 22, 2023
Part III
Department of Defense
-----------------------------------------------------------------------
Defense Acquisition Regulations System
-----------------------------------------------------------------------
48 CFR Parts 204, 208, et al.
Defense Federal Acquisition Regulation Supplements: Use of Supplier
Performance Risk System (SPRS) Assessments (DFARS Case 2019-D009);
Noncommercial Computer Software (DFARS Case 2018-D018); Ground and
Flight Risk (DFARS Case 2020-D027); Contract Administration Office
Functions Relating to Direct Costs (DFARS Case 2022-D021); Technical
Amendments; Export-Controlled Items (DFARS Case 2018-D053);
Restrictions on Overhaul and Repair of Naval Vessels in Foreign
Shipyards (DFARS Case 2021-D021); Final Rules and Proposed Rules
Federal Register / Vol. 88, No. 55 / Wednesday, March 22, 2023 /
Rules and Regulations
[[Page 17336]]
-----------------------------------------------------------------------
DEPARTMENT OF DEFENSE
Defense Acquisition Regulations System
48 CFR Parts 204, 208, 209, 212, 213, 215, 216, and 252
[Docket DARS-2020-0027]
RIN 0750-AK44
Defense Federal Acquisition Regulation Supplement: Use of
Supplier Performance Risk System (SPRS) Assessments (DFARS Case 2019-
D009)
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 update the policy and
procedures for use of the Supplier Performance Risk System and to
require contracting officers to consider SPRS risk assessments, if
available, in the evaluation of a supplier's quotation or offer and to
consider SPRS supplier risk assessments when determining contractor
responsibility.
DATES: Effective March 22, 2023.
FOR FURTHER INFORMATION CONTACT: Heather Kitchens, telephone 571-296-
7152.
SUPPLEMENTARY INFORMATION:
I. Background
DoD published a proposed rule in the Federal Register at 85 FR
53748 on August 31, 2020, to amend the DFARS to require contracting
officers to consider Supplier Performance Risk System (SPRS) risk
assessments during evaluation of quotations or offers and to consider
the SPRS supplier risk assessment in the evaluation of contractor
responsibility. Two respondents submitted public comments in response
to the proposed rule.
II. Discussion and Analysis
DoD reviewed the public comments in the development of the final
rule. 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 Proposed Rule
As a result of public comments, there are changes from the proposed
rule in the final rule to clarify applicability of the rule.
Additionally, editorial and clarifying changes were made in the final
rule as discussed in paragraph C of this preamble.
B. Analysis of Public Comments
a. Solicitation Provision Applicability
Comment: One respondent commented that the prescription for
solicitation provision 252.204-70XX, Notice to Prospective Suppliers on
the Use of the Supplier Performance Risk System in Performance
Evaluations, should be updated at DFARS 204.7X04 to state that the
provision is for use in solicitations using FAR part 13 simplified
acquisition procedures, including solicitations for supplies and
services using FAR part 12 procedures for the acquisition of commercial
items, to align with DFARS 204.7X02, Applicability.
Response: The final rule revises DFARS 204.7602, Applicability, to
align with the solicitation provision prescription at DFARS 204.7604
and the stated intent of the rule to move the coverage from part 213 to
a new subpart 204.76, as described in the preamble of the proposed
rule. Section 204.7602 states that use of SPRS risk assessments is
required for the evaluation of quotations or offers in response to
solicitations for supplies and services, including solicitations using
FAR part 12 procedures for the acquisition of commercial products and
commercial services. DFARS 204.7602, as revised, does not limit
applicability of use of SPRS risk assessments to acquisitions using FAR
part 13 simplified acquisition procedures; therefore, the recommended
change to the solicitation provision prescription at DFARS 204.7604
will not be made.
The solicitation provision is prescribed for use in solicitations
for supplies and services, including solicitations using FAR part 12
procedures for the acquisition of commercial products and commercial
services. To clarify that the provision also applies to solicitations
using FAR part 13 simplified acquisition procedures, the rule revises
the language in part 213 at 213.106-2, paragraph (b)(i), to provide a
cross-reference to 204.7603 and to require contracting officers to
consider SPRS risk assessments as a basis of award for solicitations
using FAR part 13 simplified acquisition procedures, and obsolete
language is removed. Further, to more clearly reflect that the intended
purpose of the provision extends beyond FAR part 13 actions, the
provision title is revised to read as follows: 252.204-7024, Notice on
the Use of the Supplier Performance Risk System.
The proposed rule, at sections I. and II. of the preamble, stated
that SPRS is required to be used to evaluate quotes and offers received
under all solicitations for supplies and services. To further clarify
applicability of the procedures at DFARS 204.7603 to Federal Supply
Schedules, commercial acquisitions, acquisitions using FAR part 13
simplified acquisition procedures, evaluation of offers under part 215,
and indefinite-delivery contracts, cross-references to DFARS 204.7603
are added to--
Subpart 208.4, Federal Supply Schedules;
Subpart 212.2, Special Requirements for the Acquisition of
Commercial Products and Commercial Services;
Subpart 213.1, Procedures;
215.3, Source Selection; and
Subpart 216.5, Indefinite-Delivery Contracts.
b. SPRS Website
Comment: One respondent commented that Government-Industry Data
Exchange Program (GIDEP) alerts are not appropriate measures of quality
performance and such data cannot be accurately translated into
meaningful risk scores without dissecting each GIDEP report, including
supplier letters and enclosures.
Response: GIDEP alerts are only used if they are Government-
generated (Agency Action Notice) with a Commercial and Government
Entity (CAGE) code reported explicitly for Suspected Counterfeit or
Failure Experience. SPRS does not search GIDEP narratives or text. It
only searches for data indicating that the item has been identified as
suspected counterfeit or has been determined to be a material failure.
Comment: One respondent commented that Mechanization of Contact
Administration Services (MOCAS) is not specifically intended to measure
on-time delivery performance and will require substantial investment by
industry and DoD buying commands to maintain its accuracy and
reliability.
Response: SPRS only uses MOCAS records that provide a specific
contractor's Commercial and Government Entity (CAGE) code, product
service code (PSC), and a required delivery date on a contract line
item that can be matched to an actual delivery date. This constrained
usage mitigates the concerns the respondent identified.
Comment: One respondent commented that the SPRS system itself may
not be able to handle the
[[Page 17337]]
administrative and logistical challenges that will arise under its
expanded use.
Response: DoD does not expect any issues with increased user
traffic as a result of this rule. SPRS has recently experienced a rapid
increase in user activity without any system impacts. Publication of
this rule will not adversely impact operation of the system or the
program office.
C. Other Changes
The following are amplifying changes to the rule that are not based
on public comments, but were made to add clarity:
The term ``overall risk assessments'' at DFARS 204.7602
and 204.7603 was changed to ``risk assessments'' throughout the final
rule to use language consistent with the SPRS website.
Some instances of the terms ``evaluated'' and
``evaluation'' were replaced with the term ``considered'' and ``shall
consider'' to clarify that risk assessments are not a mandatory, stand-
alone, evaluation factor for source selections and that the contracting
officer shall ``consider'' the risk assessments, if available, as part
of broader evaluation factors during evaluation of quotations or offers
and when determining contractor responsibility.
DFARS 204.7603, Procedures, was updated to clarify the
scope of SPRS risk assessments required to be considered when procuring
supplies and services and the scope of SPRS risk assessments required
to be considered when procuring an end product (see FAR 2.101)
identified by an available material identifier (see Procedures,
Guidance, and Information (PGI) 204.7603). The contracting officer
shall consider price risk and supplier risk, if available, as part of
the award decision. For the procurement of an end product identified by
an available material identifier, the contracting officer shall also
consider item risk.
DFARS 204.7603, Procedures, was updated to clarify that
contracting officers shall use their discretion in considering the
information available in SPRS.
DFARS 204.7603, Procedures, was updated under paragraph
(a), Item Risk, to clarify that a SPRS item risk search is required for
any end product that did not have an item risk search performed prior
to solicitation to ensure that item risk searches in SPRS only occur if
an end product did not have an item risk search performed prior to
solicitation; and paragraph (b), Price Risk, applies when procuring a
service or an end product identified by an available material
identifier.
An editorial change was made throughout to correct an
administrative error by removing the words ``or services'' from the
definition of ``item risk'', as item risk does not apply to services.
III. Applicability to Contracts at or Below the Simplified Acquisition
Threshold, for Commercial Services, and for Commercial Products,
Including Commercially Available Off-the-Shelf Items
This rule creates a new solicitation provision, DFARS 252.204-7024,
Notice on the Use of the Supplier Performance Risk System. The
provision at DFARS 252.204-7024 is prescribed at DFARS 204.7604 for use
in in solicitations for supplies and services, including solicitations
using FAR part 12 procedures for the acquisition of commercial products
and commercial services. The provision is applicable to acquisitions at
or below the simplified acquisition threshold (SAT) and to acquisitions
of commercial products, including commercially available off-the-shelf
(COTS) items, and commercial services. Not applying this provision to
contracts at or below the SAT and for the acquisition of commercial
products, including COTS items, and commercial services would exclude
contracts intended to be covered by this rule and undermine the
overarching purpose of the rule. Consequently, DoD is applying the rule
to contracts below the SAT, for the acquisition of commercial services,
and for the acquisition of commercial products, 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
subject to review under section 6(b) of E.O. 12866, Regulatory Planning
and Review, dated September 30, 1993.
V. Congressional Review Act
As required by the Congressional Review Act (5 U.S.C. 801-808)
before an interim or final rule takes effect, DoD will submit a copy of
the interim or final rule with the form, Submission of Federal Rules
under the Congressional Review Act, to the U.S. Senate, the U.S. House
of Representatives, and the Comptroller General of the United States. A
major rule under the Congressional Review Act cannot take effect until
60 days after it is published in the Federal Register. The Office of
Information and Regulatory Affairs has determined that this rule is not
a major rule as defined by 5 U.S.C. 804.
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 is necessary to revise the Defense Federal
Acquisition Regulation Supplement (DFARS) to incorporate the expanded
capabilities of the Supplier Performance Risk System (SPRS), made
possible by recent technical enhancements. SPRS is a DoD enterprise
application that retrieves price, item, quality, delivery, and
contractor performance data from Government reporting systems. SPRS
collects quality and delivery data from Government systems to develop
risk assessments. The system provides three risk assessments for
contracting officer use in evaluations of quotations and offers: an
item risk assessment, a price risk assessment, and a supplier risk
assessment.
The objective of the final rule is to notify offerors, via the new
solicitation provision at DFARS 252.204-7024, that SPRS collects
performance data from a variety of Government sources on awarded
contracts to develop item risk, price risk, and supplier risk
assessments for contracting officers to consider during evaluation of
quotations or offers. The final rule also requires contracting officers
to consider the supplier risk assessment in the determination of
contractor responsibility.
No comments were received in response to the initial regulatory
flexibility analysis.
The Federal Procurement Data System indicates that in fiscal years
2020 through 2022, DoD awarded an average of 483,364 contracts per year
for both products and services, of which an average of 338,039
(approximately 70 percent) were awarded to an average of 22,760 unique
small businesses.
This rule does not require any specific reporting, recordkeeping,
or compliance requirements.
No significant economic impact on small businesses is anticipated
as a result of the final rule. DoD does not expect small entities will
be materially affected by this rule. There are no
[[Page 17338]]
known significant alternatives to the rule.
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 204, 208, 209, 212, 213, 215, 216,
and 252
Government procurement.
Jennifer D. Johnson,
Editor/Publisher, Defense Acquisition Regulations System.
Therefore, 48 CFR parts 204, 208, 209, 212, 213, 215, 216, and 252
are amended as follows:
0
1. The authority citation for 48 CFR parts 204, 208, 209, 212, 213,
215, 216, and 252 continues to read as follows:
Authority: 41 U.S.C. 1303 and 48 CFR chapter 1.
PART 204--ADMINISTRATIVE AND INFORMATION MATTERS
0
2. Add subpart 204.76 to read as follows:
Subpart 204.76--Supplier Performance Risk System
204.7600 Scope of subpart.
204.7601 Definitions.
204.7602 Applicability.
204.7603 Procedures.
204.7604 Solicitation provision.
Subpart 204.76--Supplier Performance Risk System
204.7600 Scope of subpart.
This subpart provides policies and procedures for use of the
Supplier Performance Risk System (SPRS) risk assessments in the
evaluation of a quotation or offer.
204.7601 Definitions.
As used in this subpart--
Item risk means the probability that a product, based on intended
use, will introduce performance risk resulting in safety issues,
mission degradation, or monetary loss.
Price risk means the 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 may subject the
procurement to the risk of unsuccessful performance or to supply chain
risk (see 239.7301).
204.7602 Applicability.
Use of SPRS risk assessments is required for the evaluation of
quotations or offers in response to solicitations for supplies and
services, including solicitations using FAR part 12 procedures for the
acquisition of commercial products and commercial services, excluding
solicitations for the procurement of supplies or services exempted by
the Department of Defense Instruction (DoDI) 5000.79, Defense-wide
Sharing and Use of Supplier and Product Performance Information. SPRS
retrieves item, price, quality, delivery, and contractor information
from contracts in Government reporting systems in order to develop risk
assessments of contractors. SPRS is available at https://piee.eb.mil/,
and the SPRS user's guides are available at https://www.sprs.csd.disa.mil/reference.htm.
204.7603 Procedures.
The contracting officer shall consider price risk and supplier
risk, if available in SPRS, as a part of the award decision. For
procurement of an end product identified by a material identifier that
is available as described at PGI 204.7603, the contracting officer
shall also consider assessments of item risk, if available, as a part
of the award decision. Offerors or quoters without a risk assessment in
SPRS shall not be considered favorably or unfavorably. Contracting
officers shall use their discretion in considering the information
available in SPRS on item risk, price risk, and supplier risk as
follows:
(a) Item risk. (1) Consider item risk to determine whether the
procurement of products represents a high performance risk to the
Government. If an item has a high risk rating, then the SPRS item risk
report will display the reason(s) an item is identified as high risk.
(2) Before issuing a solicitation for the procurement of an end
product identified by a material identifier that is available as
described at PGI 204.7603, the contracting officer shall ensure a SPRS
item risk search has been performed and shall consider any item risk
warnings provided. When evaluating quotations or offers for an end
product identified by a material identifier, a SPRS item risk search is
required for any end product that did not have an item risk search
performed prior to solicitation. If there are item risk warnings, the
contracting officer shall consider strategies to mitigate risk, such as
the following:
(i) Consulting with the program office.
(ii) Including mitigating requirements in the statement of work, as
provided by the requiring activity.
(iii) Including FAR and DFARS clauses identified in the SPRS
application, as appropriate.
(b) Price risk. (1) When procuring a service or an end product
identified by a material identifier that is available as described at
PGI 204.7603, the contracting officer shall consider price risk
assessment in determining if a proposed price is consistent with
historical prices paid for an item or otherwise creates a risk to the
Government. Contracting officers shall not rely solely on the price
risk assessment when determining prices to be fair and reasonable.
(2) The contracting officer shall consider strategies to mitigate
price risk, such as the following:
(i) Not awarding to offerors or quoters with high risk price
ratings unless there is a way to justify the price through additional
price or cost analysis.
(ii) Utilizing appropriate price negotiation techniques and
procedures.
(iii) Using price reasonableness or price realism techniques at FAR
13.106 or 15.4. See also 215.403-3 when making award decisions.
(c) Supplier risk. The contracting officer shall consider supplier
risk, to assess the risk of unsuccessful performance and supply chain
risk, in award decisions. Supplier risk assessments in SPRS include
quality, delivery, and other contractor performance information.
204.7604 Solicitation provision.
Except for supplies or services exempted by DoDI 5000.79, use the
provision at 252.204-7024, Notice on the Use of the Supplier
Performance Risk System, in solicitations for supplies and services,
including solicitations using FAR part 12 procedures for the
acquisition of commercial products and commercial services.
PART 208--REQUIRED SOURCES OF SUPPLIES AND SERVICES
0
3. Amend section 208.405 by adding paragraph (4) to read as follows:
208.405 Ordering procedures for Federal Supply Schedules.
* * * * *
(4) See 204.7603 for procedures on the required use of the Supplier
Performance Risk System (SPRS) risk assessments.
(i) The contracting officer shall ensure SPRS assessments of price
risk and supplier risk are considered as a part of the award decision.
[[Page 17339]]
(ii) When placing an order with a schedule contractor for an end
product identified by a material identifier that is available as
described at PGI 204.7603, and item risk was not previously considered
during award of the schedule contract, the contracting officer shall
also consider SPRS assessments of item risk in the award decision.
(iii) Use the provision at 252.204-7024, Notice on the Use of the
Supplier Performance Risk System, as prescribed in 204.7604 to the
extent permitted by the Federal Supply Schedule.
PART 209--CONTRACTOR QUALIFICATIONS
0
4. Amend section 209.105-1 by revising paragraph (2) to read as
follows:
209.105-1 Obtaining information.
* * * * *
(2) A satisfactory performance record is a factor in determining
contractor responsibility (see FAR 9.104-1(c)).
(i) One source of information relating to contractor performance is
the Contractor Performance Assessment Reporting System (CPARS),
available at https://www.cpars.gov/.
(ii) Information relating to contract terminations for cause and
for default is also available through the Federal Awardee Performance
and Integrity Information System (FAPIIS) module of CPARS, available at
https://sam.gov (see FAR subpart 42.15). This termination information
is just one consideration in determining contractor responsibility.
(iii) Contracting officers shall consider the supplier risk
assessment available in the Supplier Performance Risk System at https://piee.eb.mil/ when determining responsibility. See 204.7603(c).
PART 212--ACQUISITION OF COMMERCIAL PRODUCTS AND COMMERCIAL
SERVICES
0
5. Amend section 212.203 by adding paragraph (3) to read as follows:
212.203 Procedures for solicitation, evaluation, and award.
* * * * *
(3) See 204.7603 for procedures on the required use of Supplier
Performance Risk System risk assessments as part of the award decision.
0
6. Amend section 212.301 by--
0
a. Adding paragraph (f)(ii)(O);
0
b. Removing paragraph (f)(v); and
0
c. Redesignating paragraphs (f)(vi) through (xx) as paragraphs (f)(v)
through (xix).
The addition reads as follows:
212.301 Solicitation provisions and contract clauses for the
acquisition of commercial products and commercial services.
* * * * *
(f) * * *
(ii) * * *
(O) Use the provision at 252.204-7024, Notice on the Use of the
Supplier Performance Risk System, as prescribed in 204.7604.
* * * * *
PART 213--SIMPLIFIED ACQUISITION PROCEDURES
0
7. Revise section 213.106-2 to read as follows:
213.106-2 Evaluation of quotations or offers.
(b)(i) See 204.7603 for procedures on the requirement for
contracting officers to consider Supplier Performance Risk System risk
assessments as a basis of award.
0
8. Revise section 213.106-2-70 to read as follows:
213.106-2-70 Solicitation provision.
Use the provision at 252.204-7024, Notice on the Use of the
Supplier Performance Risk System, as prescribed in 204.7604.
PART 215--CONTRACTING BY NEGOTIATION
0
9. Amend section 215.304 by adding paragraph (c)(viii) to read as
follows:
215.304 Evaluation factors and significant subfactors.
(c) * * *
(viii)(A) When procuring supplies or services, the contracting
officer shall ensure Supplier Performance Risk System (SPRS)
assessments of price risk and supplier risk are considered as a part of
the award decision. See 204.7603.
(B) When procuring an end product identified by a material
identifier that is available as described at PGI 204.7603, the
contracting officer shall also consider SPRS assessments of item risk
in the award decision.
0
10. Amend section 215.404-1 by adding paragraph (b)(viii) to read as
follows:
215.404-1 Proposal analysis techniques.
* * * * *
(b) * * *
(viii) When procuring a service or an end product identified by a
material identifier that is available as described at PGI 204.7603, the
contracting officer shall consider the Supplier Performance Risk System
price risk assessments in determining if a proposed price is consistent
with historical prices paid for an item or otherwise creates a risk to
the Government. See also 215.403-3(a)(1).
* * * * *
PART 216--TYPES OF CONTRACTS
0
11. Amend section 216.505 by adding paragraph (a)(S-71) to read as
follows:
216.505 Ordering.
(a) * * *
(S-71) See 204.7603 for procedures on the required use of the
Supplier Performance Risk System (SPRS) risk assessments.
(i) The contracting officer shall ensure SPRS assessments of price
risk and supplier risk are considered as a part of the award decision.
(ii) When placing an order for an end product identified by a
material identifier that is available as described at PGI 204.7603, and
item risk was not previously considered during award of the contract,
the contracting officer shall also consider SPRS assessments of item
risk in the award decision.
(iii) Use the provision at 252.204-7024, Notice on the Use of the
Supplier Performance Risk System, as prescribed in 204.7604 to the
extent permitted by the contract.
* * * * *
PART 252--SOLICITATION PROVISIONS AND CONTRACT CLAUSES
0
12. Add section 252.204-7024 to read as follows:
252.204-7024 Notice on the Use of the Supplier Performance Risk
System.
As prescribed in 204.7604, use the following provision:
Notice on the Use of the Supplier Performance Risk System (Mar 2023)
(a) Definitions. As used in this provision--
Item risk means the probability that a product, 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 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://piee.eb.mil/, will be used in the evaluation of the Quoter
or Offeror's performance. SPRS retrieves item, price, quality,
delivery, and contractor information on contracts from Government
[[Page 17340]]
reporting systems in order to develop risk assessments.
(c) The Contracting Officer will consider SPRS risk assessments
during the evaluation of quotations or offers received in response
to this solicitation as follows:
(1) Item risk will be considered to determine whether the
procurement represents a high performance risk to the Government.
(2) Price risk will be considered in determining if a proposed
price is consistent with historical prices paid for a product or a
service or otherwise creates a risk to the Government.
(3) Supplier risk, including but not limited to quality and
delivery, will be considered to assess the risk of unsuccessful
performance and supply chain risk.
(d) SPRS risk assessments are generated daily. Quoters or
Offerors are able to access their risk assessments by following the
access instructions in the SPRS user's guide available at https://www.sprs.csd.disa.mil/reference.htm. Quoters and Offerors 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 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)
252.213-7000 [Removed and Reserved]
0
13. Remove and reserve section 252.213-7000.
[FR Doc. 2023-05671 Filed 3-21-23; 8:45 am]
BILLING CODE 5001-06-P
