Defense Federal Acquisition Regulation Supplement: Preference for United States Vessels in Transporting Supplies by Sea (DFARS Case 2021-D020), 31681-31686 [2024-08436]
Download as PDF
<![CDATA[
lotter on DSK11XQN23PROD with PROPOSALS1
Federal Register / Vol. 89, No. 81 / Thursday, April 25, 2024 / Proposed Rules
approximately 127 small businesses
would be awarded contracts or a
combination of contracts and other
prizes. However, an initial regulatory
flexibility analysis has been performed
and is summarized as follows:
DoD is proposing to implement
section 822 of the National Defense
Authorization Act (NDAA) for Fiscal
Year (FY) 2022 (Pub. L. 117–81), which
amends 10 U.S.C. 4025, Prizes for
advanced technology achievements.
Section 822 provides advanced
technology prize programs authority to
award contracts to recognize
outstanding achievements in basic,
advanced, and applied research;
technology development; and prototype
development. This proposed rule also
provides that the award of a contract as
a prize is a competitive procedure if the
prize program solicitation is widely
advertised. Section 822 also requires
approval of such awards exceeding
$10,000 and congressional reporting for
contracts exceeding $10 million.
The objective of the proposed rule is
to implement section 822 of the NDAA
for FY 2022, which is the legal basis for
the rule.
DoD does not have data on contracts
awarded as prizes to recognize
outstanding achievements in basic,
advanced, and applied research;
technology development; and prototype
development. Contracts were not
authorized as a prize. However,
analyzing data provided from the Office
of the Under Secretary of Defense for
Research and Engineering, there were
809 cash prizes awarded from FY 2021
to FY 2023. During this three-year
period, DoD awarded a total of 636 cash
prizes to small businesses, which is an
average of 212 per year. DoD estimates
20 percent of the 212 historical cash
prize awards per year would be
converted to contracts. Therefore, DoD
estimates that approximately 42 small
businesses per year would be awarded
contracts or a combination of contracts
and other prizes as a result of this
proposed rule. Therefore, DoD does not
anticipate that this proposed rule, when
finalized, will have a significant impact
on small entities.
This rule does not impose any new
reporting, recordkeeping, or other
compliance requirements for small
entities.
This rule does not duplicate, overlap,
or conflict with any other Federal rules.
There are no known alternatives that
would accomplish the stated objectives
of the applicable statute.
DoD invites comments from small
business concerns and other interested
parties on the expected impact of this
proposed rule on small entities.
VerDate Sep<11>2014
16:45 Apr 24, 2024
Jkt 262001
DoD will also consider comments
from small entities concerning the
existing regulations in subparts affected
by this proposed 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 2022–D014), in correspondence.
31681
DEPARTMENT OF DEFENSE
Defense Acquisition Regulations
System
48 CFR Parts 242, 247, and 252
[Docket DARS–2024–0013]
RIN 0750–AL38
VII. Paperwork Reduction Act
This proposed 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 Part 206
Government procurement.
Jennifer D. Johnson,
Editor/Publisher, Defense Acquisition
Regulations System.
Therefore, 48 CFR part 206 is
proposed to be amended as follows:
PART 206—COMPETITION
REQUIREMENTS
1. The authority citation for 48 CFR
part 206 continues to read as follows:
■
Authority: 41 U.S.C. 1303 and 48 CFR
chapter 1.
2. Amend section 206.102–70 by—
■ a. Designating the text as paragraph
(a); and
■ b. Adding a new paragraph (b) to read
as follows:
■
206.102–70
Other competitive procedures.
(a) * * *
(b) The award of a contract as a prize
resulting from a competitive selection of
prize recipients for advanced
technology achievements is a
competitive procedure (10 U.S.C.
4025(f)), when the solicitation is widely
advertised, including through the
Governmentwide point of entry (see
FAR part 5). See PGI 206.102–70 for
approval requirements.
[FR Doc. 2024–08437 Filed 4–24–24; 8:45 am]
BILLING CODE 6001–FR–P
PO 00000
Defense Federal Acquisition
Regulation Supplement: Preference for
United States Vessels in Transporting
Supplies by Sea (DFARS Case 2021–
D020)
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 William M.
(Mac) Thornberry National Defense
Authorization Act for Fiscal Year 2021
intended to increase compliance with
military cargo preference requirements.
DATES: Comments on the proposed rule
should be submitted in writing to the
address shown below on or before June
24, 2024, to be considered in the
formation of a final rule.
ADDRESSES: Submit comments
identified by DFARS Case 2021–D020,
using either of the following methods:
Æ Federal eRulemaking Portal:
https://www.regulations.gov. Search for
DFARS Case 2021–D020. Select
‘‘Comment’’ and follow the instructions
to submit a comment. Please include
‘‘DFARS Case 2021–D020’’ on any
attached documents.
Æ Email: osd.dfars@mail.mil. Include
DFARS Case 2021–D020 in the subject
line of the message.
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 https://
www.regulations.gov, approximately
two to three days after submission to
verify posting.
FOR FURTHER INFORMATION CONTACT:
David Johnson, telephone 202–913–
5764.
SUMMARY:
SUPPLEMENTARY INFORMATION:
I. Background
DoD is proposing to revise the DFARS
to implement section 1024 of the
William M. (Mac) Thornberry National
Defense Authorization Act (NDAA) for
Fiscal Year (FY) 2021 (Pub. L. 116–283).
Section 1024 amends 10 U.S.C. 2631 to,
Frm 00023
Fmt 4702
Sfmt 4702
E:\FR\FM\25APP1.SGM
25APP1
31682
Federal Register / Vol. 89, No. 81 / Thursday, April 25, 2024 / Proposed Rules
lotter on DSK11XQN23PROD with PROPOSALS1
among other things, clarify
circumstances in which DoD may seek
a waiver from the basic requirement for
DoD supplies to be transported by sea in
either vessels belonging to the United
States or vessels of the United States. In
particular, section 1024 specifies that
DoD may waive this requirement, where
such vessels are either not available at
a fair and reasonable rate for
commercial vessels of the United States
or otherwise not available. Section 1024
also modifies the requirement for
reflagging or repair work in the United
States for vessels used under time
charter contracts for the transportation
of supplies, and it adds a requirement
to ensure contractor compliance with 10
U.S.C. 2631.
II. Discussion and Analysis
This proposed rule includes
modifications at DFARS 247.572(a)(1)
and the contract clause at 252.247–7023,
Transportation of Supplies by Sea,
including its alternates, to specify that
DoD may waive the requirement for DoD
supplies to be transported by sea in
either vessels belonging to the United
States or vessels of the United States.
Under this proposed rule, waivers may
be granted, where such vessels are
either not available at a fair and
reasonable rate for commercial vessels
of the United States or otherwise not
available.
This proposed rule contains changes
to DFARS 247.572(c) and the clause at
252.247–7025, Reflagging or Repair
Work, to update requirements for
reflagging or repair work in the United
States for vessels used under time
charter contracts for the transportation
of supplies. This rule also includes
modifications at DFARS 247.573(b) and
DFARS 242.1502(g) to specify DoD
procedures for increasing contractor
compliance with the requirements of the
clause at 252.247–7023, including its
alternates.
This proposed rule adds a definition
of ‘‘corrective and preventive
maintenance or repair’’ both to DFARS
247.571 and to the clause at 252.247–
7025. Further, this proposed rule
updates the definitions of ‘‘foreign
shipyard,’’ ‘‘ocean transportation,’’
‘‘supplies’’ and ‘‘U.S.-flag vessel’’ at
DFARS 247.571 and at the clause at
252.247–7023, including its alternates,
and the solicitation provision at
252.247–7026, Evaluation Preference for
Use of Domestic Shipyards—Applicable
to Acquisition of Carriage by Vessel for
DoD Cargo in the Coastwise or
Noncontiguous Trade. Additionally, this
proposed rule deletes the definition of
‘‘shipyard’’ from the provision at
252.247–7026 because the common
VerDate Sep<11>2014
16:45 Apr 24, 2024
Jkt 262001
definition of this term suffices for this
rule. The definition of ‘‘Department of
Defense’’ is deleted from the clause at
252.247–7023, including its alternates,
because the definition of this term at
DFARS 2.101 suffices for purposes of
this proposed rule.
This proposed rule clarifies the
submission requirements in paragraph
(d)(7) of the clause at 252.247–7023,
including its alternates, where a
contractor requests use of foreign-flag
vessels.
III. Applicability to Contracts at or
Below the Simplified Acquisition
Threshold (SAT), for Commercial
Products (Including Commercially
Available Off-the-Shelf (COTS) Items),
and for Commercial Services
This proposed rule amends the
clauses at DFARS 252.247–7023,
including alternates, 252.247–7025, and
the provision at 252.247–7026.
However, this proposed rule does not
impose any new requirements on
contracts at or below the SAT, for
commercial products including COTS
items, or for commercial services. The
clauses will continue to apply to
acquisitions at or below the SAT, to
acquisitions of commercial products
including COTS items, and to
acquisitions of commercial services.
IV. Expected Impact of the Rule
This proposed rule is intended to
increase compliance with military cargo
preference requirements, in accordance
with section 1024 of the NDAA for FY
2021. These changes are largely
clarifying in nature, including
clarification of operational requirements
internal to DoD. Therefore, this
proposed rule, when finalized, is not
expected to have a significant impact on
the public.
V. 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, as amended.
PO 00000
Frm 00024
Fmt 4702
Sfmt 4702
VI. Regulatory Flexibility Act
DoD does not expect this proposed
rule, when finalized, 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.,
because the rule does not create any
new requirements or significantly
change any existing requirements for
contractors. However, an initial
regulatory flexibility analysis has been
performed and is summarized as
follows:
DoD is proposing to amend the
Defense Federal Acquisition Regulation
Supplement (DFARS) to implement
section 1024 of the William M. (Mac)
Thornberry National Defense
Authorization Act (NDAA) for Fiscal
Year (FY) 2021. Section 1024 modifies
10 U.S.C. 2631 to add a requirement to
ensure contractor compliance with 10
U.S.C. 2631 and otherwise updates the
listed circumstances in which DoD may
waive the requirement that DoD
supplies be transported by sea in vessels
belonging to the United States or vessels
of the United States. It also modifies the
requirement for reflagging or repair
work in the United States for vessels
used under time-charter contracts.
The objective of this rule is to
implement section 1024 of the NDAA
for FY 2021. Section 1024 is the legal
basis for the rule.
This proposed rule will apply to small
entities that have contracts that include
DFARS clauses 252.247–7023,
Transportation of Supplies by Sea, and
252.247–7025, Reflagging or Repair
Work. DoD obtained data from the
Procurement Business Intelligence
Service (PBIS) for all contracts and
modifications that include DFARS
clauses 252.247–7023 and 252.247–7025
for fiscal years 2020 through 2022. DoD
awarded on average 649,016 contract
actions per year that included either
DFARS clause 252.247–7023 or
252.247–7025, or both, to 31,665 unique
entities, of which approximately
363,260 contract awards (56 percent)
were made to 21,737 unique small
entities (69 percent).
The proposed rule does not impose
any new reporting, recordkeeping, or
other compliance requirements.
The rule does not duplicate, overlap,
or conflict with any other Federal rules.
There are no known alternatives that
would accomplish the stated objectives
of the applicable statute.
DoD invites comments from small
business concerns and other interested
parties on the expected impact of this
proposed rule on small entities.
DoD will also consider comments
from small entities concerning the
E:\FR\FM\25APP1.SGM
25APP1
Federal Register / Vol. 89, No. 81 / Thursday, April 25, 2024 / Proposed Rules
existing regulations in subparts affected
by this proposed 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 2021–D020), in correspondence.
VII. Paperwork Reduction Act
The Paperwork Reduction Act (44
U.S.C. chapter 35) applies to this
proposed rule. However, these changes
to the DFARS do not impose additional
information collection requirements to
the paperwork burden previously
approved under OMB Control Number
0704–0245, titled: Defense Federal
Acquisition Regulation Supplement
(DFARS) Part 247, Transportation, and
Related Clauses at 252.247.
List of Subjects in 48 CFR Parts 242,
247, and 252
Government procurement.
Jennifer D. Johnson,
Editor/Publisher, Defense Acquisition
Regulations System.
Therefore, 48 CFR parts 242, 247, and
252 are proposed to be amended as
follows:
■ 1. The authority citation for parts 242,
247, and 252 continue to read as
follows:
Authority: 41 U.S.C. 1303 and 48 CFR
chapter 1.
PART 242—CONTRACT
ADMINISTRATION AND AUDIT
SERVICES
2. Amend section 242.1502—
a. In paragraph (g)(i) by removing
‘‘Program); and’’ and adding
‘‘Program);’’ in its place;
■ b. In paragraph (g)(ii) by removing
‘‘(B)).’’ and adding ‘‘(B)); and’’ in its
place; and
■ c. By adding paragraph (g)(iii) to read
as follows:
■
■
242.1502
Policy.
(g) * * *
(iii) In accordance with 10 U.S.C.
2631(d), shall include information on
contractor compliance with
requirements of the clause at 252.247–
7023, Transportation of Supplies by Sea
(see 10 U.S.C. 2631(a), (b), and (c)).
lotter on DSK11XQN23PROD with PROPOSALS1
PART 247—TRANSPORTATION
3. Amend section 247.570—
a. By revising paragraph (a)(1);
b. In paragraph (a)(2) by removing
‘‘(Pub. L. 109–364)’’ and adding ‘‘(Pub.
L. 109–364) (10 U.S.C. 2631 note)’’ in its
place;
■ c. In paragraph (a)(3) by removing
‘‘(Pub. L. 110–417)’’ and ‘‘chapter 121,
title 46 U.S.C.’’ and adding ‘‘(Pub. L.
■
■
■
VerDate Sep<11>2014
16:45 Apr 24, 2024
Jkt 262001
110–417) (10 U.S.C. chapter 257 note)’’
and ‘‘46 U.S.C. chapter 121’’ in their
places, respectively;
■ d. By adding a new paragraph (a)(4).
■ e. In paragraph (b) by removing ‘‘46
U.S.C. 1241(b)’’ and adding ‘‘46 U.S.C.
chapter 553’’ in its place; and
■ f. By revising paragraph (c).
The revisions read as follows:
247.570
Scope.
*
*
*
*
*
(a) * * *
(1) The Military Cargo Preference Act
of 1904 (‘‘the 1904 Act’’), 10 U.S.C.
2631, which applies to the ocean
transportation of cargo owned by,
destined for use by, or otherwise
transported by DoD;
*
*
*
*
*
(4) Section 1024 of the National
Defense Authorization Act for Fiscal
Year 2021 (Pub. L. 116–283), which
updates the listed circumstances where
DoD may waive the requirement that
DoD supplies be transported by sea in
vessels belonging to the United States or
vessels of the United States, and it
modifies the requirement for reflagging
or repair work in the United States for
vessels used under time-charter
contracts.
*
*
*
*
*
(c) Does not implement—
(1) Section 27 of the Merchant Marine
Act, 1920 (46 U.S.C. chapters 121 and
552), commonly known as the ‘‘Jones
Act,’’ for the application of coastwise
trade; or
(2) Waivers thereof pursuant to 46
U.S.C. 501.
■ 4. Revise section 247.571 to read as
follows:
247.571
Definitions.
As used in this subpart—
Corrective and preventive
maintenance or repair means—
(1) Maintenance or repair actions
performed as a result of a failure in
order to return or restore equipment to
acceptable performance levels; and
(2) Scheduled maintenance or repair
actions to prevent or discover functional
failures.
Covered vessel means a vessel—
(1) Owned, operated, or controlled by
the offeror; and
(2) Qualified to engage in the carriage
of cargo in the coastwise or
noncontiguous trade under 46 U.S.C.
12112 and 50501 and 46 U.S.C. chapter
551.
Foreign-flag vessel means any vessel
that is not a U.S.-flag vessel.
Foreign shipyard means a shipyard
that is not located in the United States.
Ocean transportation means any
water-borne transportation aboard a
PO 00000
Frm 00025
Fmt 4702
Sfmt 4702
31683
ship, vessel, boat, barge, ferry, or the
like outside the internal waters of the
United States (as defined in 33 CFR
2.24).
Overhaul, repair, and maintenance
work means work requiring a shipyard
period greater than or equal to 5
calendar days.
Reflagging or repair work means work
performed on a vessel—
(1) To enable the vessel to meet
applicable standards to become a vessel
of the United States; or
(2) To convert the vessel to a more
useful military configuration.
Supplies means supplies that are
clearly identifiable for eventual use by
or owned by DoD at the time of
transportation by sea, or are otherwise
transported by DoD, regardless of
ownership or use by DoD. An item is
clearly identifiable for eventual use by
DoD if, for example, the contract
documentation contains a reference to a
DoD contract number or a military
destination.
U.S.-flag vessel means either a vessel
belonging to the United States or a
vessel of the United States as that term
is defined in 46 U.S.C. 116.
■ 5. Revise section 247.572 to read as
follows:
247.572
Policy.
(a) In accordance with 10 U.S.C.
2631(a), DoD contractors shall transport
supplies exclusively on U.S.-flag
vessels. In accordance with 10 U.S.C.
2631(b), DoD (see 247.573(a)) may waive
this requirement when a U.S.-flag
vessel—
(1) Is not available at a fair and
reasonable rate for commercial vessels
of the United States; or
(2) Is not otherwise available.
(b) Contracts must provide for the use
of vessels belonging to the United States
when security classifications prohibit
the use of other than vessels belonging
to the United States.
(c) In accordance with 10 U.S.C.
2631(c)—
(1) Any vessel used under a time
charter contract for the transportation of
supplies under this section shall have
the following work performed in the
United States or its outlying areas:
(i) Reflagging or repair work, if the
reflagging or repair work is performed—
(A) On a vessel for which the
contractor submitted an offer in
response to the solicitation for the
contract; and
(B) Prior to acceptance of the vessel
by the Government.
(ii) Corrective and preventive
maintenance or repair work for the
duration of the contract, to the greatest
extent practicable.
E:\FR\FM\25APP1.SGM
25APP1
31684
Federal Register / Vol. 89, No. 81 / Thursday, April 25, 2024 / Proposed Rules
(2) The Secretary of Defense may
waive this requirement if the Secretary
determines that such waiver is critical
to the national security of the United
States. In accordance with 10 U.S.C.
2631(c)(2), DoD shall immediately
submit, in writing, a notice to the
congressional committees listed at 10
U.S.C. 2631(e) of such a waiver and the
reason for the waiver.
(d) In accordance with section 1017 of
the National Defense Authorization Act
for Fiscal Year 2007 (Pub. L. 109–364),
when obtaining carriage requiring a
covered vessel, the contracting officer
shall consider the extent to which
offerors have had overhaul, repair, and
maintenance work for covered vessels
performed in shipyards located in the
United States or Guam.
(e) In accordance with section 3504 of
the National Defense Authorization Act
for Fiscal Year 2009 (Pub. L. 110–417),
DoD may not award, renew or extend,
or exercise an option under a charter of,
or contract for carriage of cargo by, a
U.S.-flag vessel documented under 46
U.S.C. chapter 121, unless the contract
contains the clause at 252.247–7027.
■ 6. Amend section 247.573—
■ a. By revising paragraph (a);
■ b. In paragraph (b)—
■ i. By revising paragraph (3);
■ ii. In paragraph (4) by removing
‘‘Procedures are provided at’’ and
adding ‘‘Follow the procedures at’’ in its
place; and
■ iii. By adding a new paragraph (5).
The revisions and addition read as
follows:
lotter on DSK11XQN23PROD with PROPOSALS1
247.573
General.
(a) Delegated authority. Pursuant to
10 U.S.C. 2631(b)(2), the Secretary of
Defense has delegated (see PGI 247.573)
the authority to make determinations
either that a U.S.-flag vessel is not
available at a fair and reasonable rate for
commercial vessels of the United States
or is otherwise not available to—
(1) The Commander, United States
Transportation Command; and
(2) The Secretary of the Navy.
(b) * * *
*
*
*
*
*
(3) See PGI 247.573(b)(3) for agency
and department procedures relating to
annual reporting requirements of
waivers granted for nonavailability of
U.S.-flag vessels.
*
*
*
*
*
(5)(i) In accordance with 10 U.S.C.
2631(d), contracting officers shall
exercise appropriate contractual rights
and remedies against contractors who
fail to comply. Such remedies may
include the determination that a
contractor is ineligible for award of
VerDate Sep<11>2014
16:45 Apr 24, 2024
Jkt 262001
future contracts, termination of an
existing contract, or suspension or
debarment of the contractor. Also see
242.1502 regarding assessments of the
contractor’s past performance.
(ii) In the event of a contractor’s
unauthorized use of foreign-flag vessels
in the performance of a contract, the
contracting officer is authorized to
consider an equitable adjustment.
PART 252—SOLICITATION
PROVISIONS AND CONTRACT
CLAUSES
7. Amend section 252.247–7023—
a. Revising the date of the clause;
b. By revising paragraph (a);
c. By revising paragraph (c);
d. In paragraph (d) introductory text
by revising the second sentence and
paragraph (7);
■ e. In paragraph (e)(10) by removing
‘‘the steamship company’’ and adding
‘‘the carrier’’ in its place;
■ f. In paragraph (f)(3) by removing ‘‘had
the written consent of the Contracting
Officer’’ and adding ‘‘had received a
prior-approved waiver for U.S.-flag
vessels’’ in its place;
■ g. In paragraph (f)(4) by removing ‘‘of
the Contracting Officer’’ and adding ‘‘of
DoD’’ in its place;
■ h. Amend Alternate I—
■ i. Revising the date of the clause;
■ ii. By revising paragraph (a);
■ iii. By revising paragraph (c);
■ iv. In paragraph (d) introductory text
by revising the second sentence and
paragraph (7);
■ v. In paragraph (e)(10) by removing
‘‘steamship company’’ and adding ‘‘the
carrier’’ in its place;
■ vi. In paragraph (f)(3) by removing
‘‘had the written consent of the
Contracting Officer’’ and adding ‘‘had
received a prior-approved waiver for
U.S.-flag vessels’’ in its place;
■ vii. In paragraph (f)(4) by removing
‘‘of the Contracting Officer’’ and adding
‘‘of DoD’’ in its place;
■ i. Amend Alternate II—
■ i. Revising the date of the clause;
■ ii. By revising paragraph (a);
■ iii. By revising paragraph (c);
■ iv. In paragraph (d) introductory text
by revising the second sentence and
paragraph (7);
■ v. In paragraph (e)(10) by removing
‘‘steamship company’’ and adding ‘‘the
carrier’’ in its place;
■ vi. In paragraph (f)(3) by removing
‘‘had the written consent of the
Contracting Officer’’ and adding ‘‘had
received a prior-approved waiver for
U.S.-flag vessels’’ in its place; and
■ vii. In paragraph (f)(4) by removing
‘‘of the Contracting Officer’’ and adding
‘‘of DoD’’ in its place.
■
■
■
■
■
PO 00000
Frm 00026
Fmt 4702
Sfmt 4702
The revisions read as follows:
252.247–7023
by Sea.
*
*
*
Transportation of Supplies
*
*
Transportation of Supplies by Sea—
Basic (Date)
(a) Definitions. As used in this
clause—
Foreign-flag vessel means any vessel
that is not a U.S.-flag vessel.
Ocean transportation means any
water-borne transportation aboard a
ship, vessel, boat, barge, ferry, or the
like outside the internal waters of the
United States as defined in 33 CFR 2.24.
Subcontractor means a supplier,
materialman, distributor, or vendor at
any level below the prime contractor
whose contractual obligation to perform
results from, or is conditioned upon,
award of the prime contract and who is
performing any part of the work or other
requirement of the prime contract.
Supplies means supplies that are
clearly identifiable for eventual use by
or owned by DoD at the time of
transportation by sea, or are otherwise
transported by DoD, regardless of
ownership or use by DoD. An item is
clearly identifiable for eventual use by
DoD if, for example, the contract
documentation contains a reference to a
DoD contract number or a military
destination.
U.S.-flag vessel means either a vessel
belonging to the United States or a
vessel of the United States as that term
is defined in 46 U.S.C. 116.
*
*
*
*
*
(c) The Contractor and its
subcontractors may request, via the
Contracting Officer, a waiver of the
requirement to use a U.S.-flag vessel, or
identification of any available U.S.-flag
vessels, if the Contractor or a
subcontractor sufficiently explains
that—
(1) U.S.-flag vessels are not available
at a fair and reasonable rate for
commercial vessels of the United States;
or
(2) U.S.-flag vessels are otherwise not
available.
(d) * * * The Contracting Officer will
process requests submitted after such
date(s) as expeditiously as possible,
however, if a DoD waiver is not
approved prior to the shipper’s sailing
date, this will not of itself constitute a
compensable delay under this or any
other clause of this contract. * * *
*
*
*
*
*
(7) A documented description of
current, diligent efforts made to secure
U.S.-flag vessels, including points of
contact (with names and telephone
numbers) with at least two U.S.-flag
E:\FR\FM\25APP1.SGM
25APP1
31685
Federal Register / Vol. 89, No. 81 / Thursday, April 25, 2024 / Proposed Rules
carriers contacted. Copies of quotes will
suffice for this purpose. Copies of
telephone notes, emails, and other
relevant communications will otherwise
be considered for this purpose.
*
*
*
*
*
lotter on DSK11XQN23PROD with PROPOSALS1
Transportation of Supplies by Sea—
Alternate I (Date)
(a) Definitions. As used in this
clause—
Foreign-flag vessel means any vessel
that is not a U.S.-flag vessel.
Ocean transportation means any
water-borne transportation aboard a
ship, vessel, boat, barge, ferry, or the
like outside the internal waters of the
United States as defined in 33 CFR 2.24.
Subcontractor means a supplier,
materialman, distributor, or vendor at
any level below the prime contractor
whose contractual obligation to perform
results from, or is conditioned upon,
award of the prime contract and who is
performing any part of the work or other
requirement of the prime contract.
Supplies means supplies that are
clearly identifiable for eventual use by
or owned by DoD at the time of
transportation by sea, or are otherwise
transported by DoD, regardless of
ownership or use by DoD. An item is
clearly identifiable for eventual use by
DoD if, for example, the contract
documentation contains a reference to a
DoD contract number or a military
destination.
U.S.-flag vessel means either a vessel
belonging to the United States or a
vessel of the United States as that term
is defined in 46 U.S.C. 116.
*
*
*
*
*
(c) The Contractor and its
subcontractors may request, via the
Contracting Officer, a waiver of the
requirement to use a U.S.-flag vessel, or
identification of any available U.S.-flag
vessels, if the Contractor or a
subcontractor sufficiently explains
that—
(1) U.S.-flag vessels are not available
at a fair and reasonable rate for
commercial vessels of the United States;
or
(2) U.S.-flag vessels are otherwise not
available.
(d) * * * The Contracting Officer will
process requests submitted after such
date(s) as expeditiously as possible,
however, if a DoD waiver is not
approved prior to the shipper’s sailing
date, this will not of itself constitute a
compensable delay under this or any
other clause of this contract. * * *
*
*
*
*
*
(7) A documented description of
current, diligent efforts made to secure
U.S.-flag vessels, including points of
VerDate Sep<11>2014
16:45 Apr 24, 2024
Jkt 262001
contact (with names and telephone
numbers) with at least two U.S.-flag
carriers contacted. Copies of quotes will
suffice for this purpose. Copies of
telephone notes, emails, and other
relevant communications will otherwise
be considered for this purpose.
*
*
*
*
*
Transportation of Supplies By Sea—
Alternate II (Date)
(a) Definitions. As used in this
clause—
Foreign-flag vessel means any vessel
that is not a U.S.-flag vessel.
Ocean transportation means any
water-borne transportation aboard a
ship, vessel, boat, barge, ferry, or the
like outside the internal waters of the
United States as defined in 33 CFR 2.24.
Subcontractor means a supplier,
materialman, distributor, or vendor at
any level below the prime contractor
whose contractual obligation to perform
results from, or is conditioned upon,
award of the prime contract and who is
performing any part of the work or other
requirement of the prime contract.
Supplies means supplies that are
clearly identifiable for eventual use by
or owned by DoD at the time of
transportation by sea, or are otherwise
transported by DoD, regardless of
ownership or use by DoD. An item is
clearly identifiable for eventual use by
DoD if, for example, the contract
documentation contains a reference to a
DoD contract number or a military
destination.
U.S.-flag vessel means either a vessel
belonging to the United States or a
vessel of the United States as that term
is defined in 46 U.S.C. 116.
*
*
*
*
*
(c) The Contractor and its
subcontractors may request, via the
Contracting Officer, a waiver of the
requirement to use a U.S.-flag vessel, or
identification of any available U.S.-flag
vessels, if the Contractor or a
subcontractor sufficiently explains
that—
(1) U.S.-flag vessels are not available
at a fair and reasonable rate for
commercial vessels of the United States;
or
(2) U.S.-flag vessels are otherwise not
available.
(d) * * * The Contracting Officer will
process requests submitted after such
date(s) as expeditiously as possible,
however, if a DoD waiver is not
approved prior to the shipper’s sailing
date, this will not of itself constitute a
compensable delay under this or any
other clause of this contract. * * *
(7) A documented description of
current, diligent efforts made to secure
PO 00000
Frm 00027
Fmt 4702
Sfmt 4702
U.S.-flag vessels, including points of
contact (with names and telephone
numbers) with at least two U.S.-flag
carriers contacted. Copies of quotes will
suffice for this purpose. Copies of
telephone notes, emails, and other
relevant communications will otherwise
be considered for this purpose.
*
*
*
*
*
■ 8. Revise section 252.247–7025 to
read as follows:
252.247–7025
Reflagging or Repair Work.
As prescribed in 247.574(c), use the
following clause:
Reflagging or Repair Work (Date)
(a) Definitions. As used in this clause—
Corrective and preventive maintenance or
repair means—
(1) Maintenance or repair actions
performed as a result of a failure in order to
return or restore equipment to acceptable
performance levels; and
(2) Scheduled maintenance or repair
actions to prevent or discover functional
failures.
Reflagging or repair work means work
performed on a vessel—
(1) To enable the vessel to meet applicable
standards to become a vessel of the United
States; or
(2) To convert the vessel to a more useful
military configuration.
(b) Requirement. Unless DoD waives this
requirement, the Contractor shall ensure
performance of the following in the United
States or its outlying areas:
(1) Reflagging or repair work, if the
reflagging or repair work is performed—
(i) On a vessel for which the Contractor
submitted an offer in response to the
solicitation for this contract; and
(ii) Prior to acceptance of the vessel by the
Government.
(2) Corrective and preventive maintenance
or repair work for the duration of the
contract, to the greatest extent practicable.
(End of clause)
■ 9. Amend section 252.247–7026—
■ a. By removing the provision date
‘‘Nov 2008’’ and adding ‘‘Date’’ in its
place;
■ b. In paragraph (a) by revising the
definitions of ‘‘Covered vessel’’ and
‘‘Foreign shipyard’’ and removing the
definition of ‘‘Shipyard’’;
■ c. In paragraphs (b) and (c) by
removing ‘‘offeror’’ and adding
‘‘Offeror’’ in its place;
■ d. In paragraph (e) removing ‘‘Section
1017 of Public Law 109–364’’ and
adding ‘‘section 1017 of Public Law
109–364 (10 U.S.C. 2631 note)’’ in its
place.
The revisions read as follows:
252.247–7026 Evaluation Preference for
Use of Domestic Shipyards—Applicable to
Acquisition of Carriage by Vessel for DoD
Cargo in the Coastwise or Noncontiguous
Trade.
*
E:\FR\FM\25APP1.SGM
*
*
25APP1
*
*
31686
Federal Register / Vol. 89, No. 81 / Thursday, April 25, 2024 / Proposed Rules
(a) * * *
Covered vessel means a vessel—
(1) Owned, operated, or controlled by
the offeror; and
(2) Qualified to engage in the carriage
of cargo in the coastwise or
noncontiguous trade under 46 U.S.C.
12112 and 50501 and 46 U.S.C. chapter
551.
Foreign shipyard means a shipyard
that is not located in the United States.
*
*
*
*
*
[FR Doc. 2024–08436 Filed 4–24–24; 8:45 am]
BILLING CODE 6001–FR–P
DEPARTMENT OF DEFENSE
Defense Acquisition Regulations
System
48 CFR Part 252
[Docket DARS–2022–0030]
RIN 0750–AL67
Defense Federal Acquisition
Regulation Supplement: Update of
Challenge Period for Validation of
Asserted Restrictions on Technical
Data and Computer Software (DFARS
Case 2022–D016)
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 2012, which addresses the
validation of proprietary data
restrictions. In addition to the request
for written comments, DoD will hold a
public meeting to hear the views of
interested parties.
DATES: Comments on the proposed rule
should be submitted in writing to the
address shown below on or before June
24, 2024, to be considered in the
formation of a final rule.
Public Meeting: A virtual public
meeting will be held on May 17, 2024,
from 1:00 p.m. to 5:00 p.m. Eastern
time. The public meeting will end at the
stated time, or when the discussion
ends, whichever comes first.
Registration: Registration to attend the
public meeting must be received no
later than close of business on May 9,
2024. Information on how to register for
the public meeting is provided under
the SUPPLEMENTARY INFORMATION section
of this proposed rule.
ADDRESSES: Public Meeting: A virtual
public meeting will be held using Zoom
video conferencing software.
lotter on DSK11XQN23PROD with PROPOSALS1
SUMMARY:
VerDate Sep<11>2014
16:45 Apr 24, 2024
Jkt 262001
Submission of Comments: Submit
comments identified by DFARS Case
2022–D016, using either of the
following methods:
Æ Federal eRulemaking Portal: https://
www.regulations.gov. Search for DFARS
Case 2022–D016. Select ‘‘Comment’’
and follow the instructions to submit a
comment. Please include ‘‘DFARS Case
2022–D016’’ on any attached
documents.
Æ Email: osd.dfars@mail.mil. Include
DFARS Case 2022–D016 in the subject
line of the message.
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 https://
www.regulations.gov, approximately
two to three days after submission to
verify posting.
FOR FURTHER INFORMATION CONTACT:
David Johnson, telephone 202–913–
5764.
SUPPLEMENTARY INFORMATION:
I. Background
DoD is proposing to revise the DFARS
to implement section 815(b) of the
National Defense Authorization Act
(NDAA) for Fiscal Year (FY) 2012 (Pub.
L. 112–81). Section 815(b) amended 10
U.S.C. 2321 (currently 10 U.S.C. 3782)
by increasing the validation period for
asserted restrictions from three years to
six years. Section 815(b) also amended
10 U.S.C. 2321 to provide an exception
to the prescribed time limit for
validation of asserted restrictions if the
technical data involved are the subject
of a fraudulently asserted use or release
restriction.
DoD published an advance notice of
proposed rulemaking (ANPR) in the
Federal Register on December 16, 2022,
at 87 FR 77055, providing draft DFARS
revisions and requesting written public
comments. DoD hosted a public meeting
to obtain the views of interested parties
regarding the ANPR on January 26,
2023.
The preamble to the ANPR provided
detailed explanations of revisions
related to—
• The validation period for asserted
restrictions; and
• The new statutory exception to the
prescribed time limit for validation of
asserted restrictions.
One respondent submitted public
comments in response to the ANPR.
II. Public Meeting
DoD is interested in continuing a
dialogue with experts and interested
parties in the Government and the
PO 00000
Frm 00028
Fmt 4702
Sfmt 4702
private sector regarding amending the
DFARS to implement section 815(b) of
the NDAA for FY 2012.
Registration: Individuals wishing to
participate in the virtual meeting must
register by May 9, 2024, to facilitate
entry to the meeting. Interested parties
may register for the meeting by sending
the following information via email to
osd.dfars@mail.mil and include ‘‘Public
Meeting, DFARS Case 2022–D016’’ in
the subject line of the message:
• Full name.
• Valid email address, which will be
used for admittance to the meeting.
• Valid telephone number, which
will serve as a secondary connection
method. Registrants must provide the
telephone number they plan on using to
connect to the virtual meeting.
• Company or organization name.
• Whether the individual desires to
make a presentation.
Pre-registered individuals will receive
instructions for connecting using the
Zoom video conferencing software not
more than one week before the meeting
is scheduled to commence.
Presentations: Presentations will be
limited to 5 minutes per company or
organization. This limit may be subject
to adjustment, depending on the
number of entities requesting to present,
in order to ensure adequate time for
discussion. If you wish to make a
presentation, please submit an
electronic copy of your presentation via
email to osd.dfars@mail.mil no later
than the registration date for the
meeting. Each presentation should be in
PowerPoint to facilitate projection
during the public meeting and should
include the presenter’s name, title,
organization affiliation, telephone
number, and email address on the cover
page.
Correspondence, Comments, and
Presentations: Please cite ‘‘Public
Meeting, DFARS Case 2022–D016’’ in
all correspondence related to the public
meeting. There will be no transcription
at the meeting. The submitted
presentations will be posted to the
following website at the conclusion of
the public meeting: https://
www.acq.osd.mil/dpap/dars/technical_
data_rights.html.
III. Discussion and Analysis
DoD reviewed the public comments in
response to the ANPR in the
development of the proposed rule. No
changes are made in this proposed rule
text as a result of the public comments.
A discussion of the comments is
provided, as follows:
E:\FR\FM\25APP1.SGM
25APP1
]]>Agencies
[Federal Register Volume 89, Number 81 (Thursday, April 25, 2024)]
[Proposed Rules]
[Pages 31681-31686]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-08436]
-----------------------------------------------------------------------
DEPARTMENT OF DEFENSE
Defense Acquisition Regulations System
48 CFR Parts 242, 247, and 252
[Docket DARS-2024-0013]
RIN 0750-AL38
Defense Federal Acquisition Regulation Supplement: Preference for
United States Vessels in Transporting Supplies by Sea (DFARS Case 2021-
D020)
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 section of the William M.
(Mac) Thornberry National Defense Authorization Act for Fiscal Year
2021 intended to increase compliance with military cargo preference
requirements.
DATES: Comments on the proposed rule should be submitted in writing to
the address shown below on or before June 24, 2024, to be considered in
the formation of a final rule.
ADDRESSES: Submit comments identified by DFARS Case 2021-D020, using
either of the following methods:
[cir] Federal eRulemaking Portal: https://www.regulations.gov.
Search for DFARS Case 2021-D020. Select ``Comment'' and follow the
instructions to submit a comment. Please include ``DFARS Case 2021-
D020'' on any attached documents.
[cir] Email: [email protected]. Include DFARS Case 2021-D020 in
the subject line of the message.
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 https://www.regulations.gov, approximately two to three days after submission
to verify posting.
FOR FURTHER INFORMATION CONTACT: David Johnson, telephone 202-913-5764.
SUPPLEMENTARY INFORMATION:
I. Background
DoD is proposing to revise the DFARS to implement section 1024 of
the William M. (Mac) Thornberry National Defense Authorization Act
(NDAA) for Fiscal Year (FY) 2021 (Pub. L. 116-283). Section 1024 amends
10 U.S.C. 2631 to,
[[Page 31682]]
among other things, clarify circumstances in which DoD may seek a
waiver from the basic requirement for DoD supplies to be transported by
sea in either vessels belonging to the United States or vessels of the
United States. In particular, section 1024 specifies that DoD may waive
this requirement, where such vessels are either not available at a fair
and reasonable rate for commercial vessels of the United States or
otherwise not available. Section 1024 also modifies the requirement for
reflagging or repair work in the United States for vessels used under
time charter contracts for the transportation of supplies, and it adds
a requirement to ensure contractor compliance with 10 U.S.C. 2631.
II. Discussion and Analysis
This proposed rule includes modifications at DFARS 247.572(a)(1)
and the contract clause at 252.247-7023, Transportation of Supplies by
Sea, including its alternates, to specify that DoD may waive the
requirement for DoD supplies to be transported by sea in either vessels
belonging to the United States or vessels of the United States. Under
this proposed rule, waivers may be granted, where such vessels are
either not available at a fair and reasonable rate for commercial
vessels of the United States or otherwise not available.
This proposed rule contains changes to DFARS 247.572(c) and the
clause at 252.247-7025, Reflagging or Repair Work, to update
requirements for reflagging or repair work in the United States for
vessels used under time charter contracts for the transportation of
supplies. This rule also includes modifications at DFARS 247.573(b) and
DFARS 242.1502(g) to specify DoD procedures for increasing contractor
compliance with the requirements of the clause at 252.247-7023,
including its alternates.
This proposed rule adds a definition of ``corrective and preventive
maintenance or repair'' both to DFARS 247.571 and to the clause at
252.247-7025. Further, this proposed rule updates the definitions of
``foreign shipyard,'' ``ocean transportation,'' ``supplies'' and
``U.S.-flag vessel'' at DFARS 247.571 and at the clause at 252.247-
7023, including its alternates, and the solicitation provision at
252.247-7026, Evaluation Preference for Use of Domestic Shipyards--
Applicable to Acquisition of Carriage by Vessel for DoD Cargo in the
Coastwise or Noncontiguous Trade. Additionally, this proposed rule
deletes the definition of ``shipyard'' from the provision at 252.247-
7026 because the common definition of this term suffices for this rule.
The definition of ``Department of Defense'' is deleted from the clause
at 252.247-7023, including its alternates, because the definition of
this term at DFARS 2.101 suffices for purposes of this proposed rule.
This proposed rule clarifies the submission requirements in
paragraph (d)(7) of the clause at 252.247-7023, including its
alternates, where a contractor requests use of foreign-flag vessels.
III. Applicability to Contracts at or Below the Simplified Acquisition
Threshold (SAT), for Commercial Products (Including Commercially
Available Off-the-Shelf (COTS) Items), and for Commercial Services
This proposed rule amends the clauses at DFARS 252.247-7023,
including alternates, 252.247-7025, and the provision at 252.247-7026.
However, this proposed rule does not impose any new requirements on
contracts at or below the SAT, for commercial products including COTS
items, or for commercial services. The clauses will continue to apply
to acquisitions at or below the SAT, to acquisitions of commercial
products including COTS items, and to acquisitions of commercial
services.
IV. Expected Impact of the Rule
This proposed rule is intended to increase compliance with military
cargo preference requirements, in accordance with section 1024 of the
NDAA for FY 2021. These changes are largely clarifying in nature,
including clarification of operational requirements internal to DoD.
Therefore, this proposed rule, when finalized, is not expected to have
a significant impact on the public.
V. 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, as amended.
VI. Regulatory Flexibility Act
DoD does not expect this proposed rule, when finalized, 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., because the rule does not create any new requirements or
significantly change any existing requirements for contractors.
However, an initial regulatory flexibility analysis has been performed
and is summarized as follows:
DoD is proposing to amend the Defense Federal Acquisition
Regulation Supplement (DFARS) to implement section 1024 of the William
M. (Mac) Thornberry National Defense Authorization Act (NDAA) for
Fiscal Year (FY) 2021. Section 1024 modifies 10 U.S.C. 2631 to add a
requirement to ensure contractor compliance with 10 U.S.C. 2631 and
otherwise updates the listed circumstances in which DoD may waive the
requirement that DoD supplies be transported by sea in vessels
belonging to the United States or vessels of the United States. It also
modifies the requirement for reflagging or repair work in the United
States for vessels used under time-charter contracts.
The objective of this rule is to implement section 1024 of the NDAA
for FY 2021. Section 1024 is the legal basis for the rule.
This proposed rule will apply to small entities that have contracts
that include DFARS clauses 252.247-7023, Transportation of Supplies by
Sea, and 252.247-7025, Reflagging or Repair Work. DoD obtained data
from the Procurement Business Intelligence Service (PBIS) for all
contracts and modifications that include DFARS clauses 252.247-7023 and
252.247-7025 for fiscal years 2020 through 2022. DoD awarded on average
649,016 contract actions per year that included either DFARS clause
252.247-7023 or 252.247-7025, or both, to 31,665 unique entities, of
which approximately 363,260 contract awards (56 percent) were made to
21,737 unique small entities (69 percent).
The proposed rule does not impose any new reporting, recordkeeping,
or other compliance requirements.
The rule does not duplicate, overlap, or conflict with any other
Federal rules.
There are no known alternatives that would accomplish the stated
objectives of the applicable statute.
DoD invites comments from small business concerns and other
interested parties on the expected impact of this proposed rule on
small entities.
DoD will also consider comments from small entities concerning the
[[Page 31683]]
existing regulations in subparts affected by this proposed 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 2021-
D020), in correspondence.
VII. Paperwork Reduction Act
The Paperwork Reduction Act (44 U.S.C. chapter 35) applies to this
proposed rule. However, these changes to the DFARS do not impose
additional information collection requirements to the paperwork burden
previously approved under OMB Control Number 0704-0245, titled: Defense
Federal Acquisition Regulation Supplement (DFARS) Part 247,
Transportation, and Related Clauses at 252.247.
List of Subjects in 48 CFR Parts 242, 247, and 252
Government procurement.
Jennifer D. Johnson,
Editor/Publisher, Defense Acquisition Regulations System.
Therefore, 48 CFR parts 242, 247, and 252 are proposed to be
amended as follows:
0
1. The authority citation for parts 242, 247, and 252 continue to read
as follows:
Authority: 41 U.S.C. 1303 and 48 CFR chapter 1.
PART 242--CONTRACT ADMINISTRATION AND AUDIT SERVICES
0
2. Amend section 242.1502--
0
a. In paragraph (g)(i) by removing ``Program); and'' and adding
``Program);'' in its place;
0
b. In paragraph (g)(ii) by removing ``(B)).'' and adding ``(B)); and''
in its place; and
0
c. By adding paragraph (g)(iii) to read as follows:
242.1502 Policy.
(g) * * *
(iii) In accordance with 10 U.S.C. 2631(d), shall include
information on contractor compliance with requirements of the clause at
252.247-7023, Transportation of Supplies by Sea (see 10 U.S.C. 2631(a),
(b), and (c)).
PART 247--TRANSPORTATION
0
3. Amend section 247.570--
0
a. By revising paragraph (a)(1);
0
b. In paragraph (a)(2) by removing ``(Pub. L. 109-364)'' and adding
``(Pub. L. 109-364) (10 U.S.C. 2631 note)'' in its place;
0
c. In paragraph (a)(3) by removing ``(Pub. L. 110-417)'' and ``chapter
121, title 46 U.S.C.'' and adding ``(Pub. L. 110-417) (10 U.S.C.
chapter 257 note)'' and ``46 U.S.C. chapter 121'' in their places,
respectively;
0
d. By adding a new paragraph (a)(4).
0
e. In paragraph (b) by removing ``46 U.S.C. 1241(b)'' and adding ``46
U.S.C. chapter 553'' in its place; and
0
f. By revising paragraph (c).
The revisions read as follows:
247.570 Scope.
* * * * *
(a) * * *
(1) The Military Cargo Preference Act of 1904 (``the 1904 Act''),
10 U.S.C. 2631, which applies to the ocean transportation of cargo
owned by, destined for use by, or otherwise transported by DoD;
* * * * *
(4) Section 1024 of the National Defense Authorization Act for
Fiscal Year 2021 (Pub. L. 116-283), which updates the listed
circumstances where DoD may waive the requirement that DoD supplies be
transported by sea in vessels belonging to the United States or vessels
of the United States, and it modifies the requirement for reflagging or
repair work in the United States for vessels used under time-charter
contracts.
* * * * *
(c) Does not implement--
(1) Section 27 of the Merchant Marine Act, 1920 (46 U.S.C. chapters
121 and 552), commonly known as the ``Jones Act,'' for the application
of coastwise trade; or
(2) Waivers thereof pursuant to 46 U.S.C. 501.
0
4. Revise section 247.571 to read as follows:
247.571 Definitions.
As used in this subpart--
Corrective and preventive maintenance or repair means--
(1) Maintenance or repair actions performed as a result of a
failure in order to return or restore equipment to acceptable
performance levels; and
(2) Scheduled maintenance or repair actions to prevent or discover
functional failures.
Covered vessel means a vessel--
(1) Owned, operated, or controlled by the offeror; and
(2) Qualified to engage in the carriage of cargo in the coastwise
or noncontiguous trade under 46 U.S.C. 12112 and 50501 and 46 U.S.C.
chapter 551.
Foreign-flag vessel means any vessel that is not a U.S.-flag
vessel.
Foreign shipyard means a shipyard that is not located in the United
States.
Ocean transportation means any water-borne transportation aboard a
ship, vessel, boat, barge, ferry, or the like outside the internal
waters of the United States (as defined in 33 CFR 2.24).
Overhaul, repair, and maintenance work means work requiring a
shipyard period greater than or equal to 5 calendar days.
Reflagging or repair work means work performed on a vessel--
(1) To enable the vessel to meet applicable standards to become a
vessel of the United States; or
(2) To convert the vessel to a more useful military configuration.
Supplies means supplies that are clearly identifiable for eventual
use by or owned by DoD at the time of transportation by sea, or are
otherwise transported by DoD, regardless of ownership or use by DoD. An
item is clearly identifiable for eventual use by DoD if, for example,
the contract documentation contains a reference to a DoD contract
number or a military destination.
U.S.-flag vessel means either a vessel belonging to the United
States or a vessel of the United States as that term is defined in 46
U.S.C. 116.
0
5. Revise section 247.572 to read as follows:
247.572 Policy.
(a) In accordance with 10 U.S.C. 2631(a), DoD contractors shall
transport supplies exclusively on U.S.-flag vessels. In accordance with
10 U.S.C. 2631(b), DoD (see 247.573(a)) may waive this requirement when
a U.S.-flag vessel--
(1) Is not available at a fair and reasonable rate for commercial
vessels of the United States; or
(2) Is not otherwise available.
(b) Contracts must provide for the use of vessels belonging to the
United States when security classifications prohibit the use of other
than vessels belonging to the United States.
(c) In accordance with 10 U.S.C. 2631(c)--
(1) Any vessel used under a time charter contract for the
transportation of supplies under this section shall have the following
work performed in the United States or its outlying areas:
(i) Reflagging or repair work, if the reflagging or repair work is
performed--
(A) On a vessel for which the contractor submitted an offer in
response to the solicitation for the contract; and
(B) Prior to acceptance of the vessel by the Government.
(ii) Corrective and preventive maintenance or repair work for the
duration of the contract, to the greatest extent practicable.
[[Page 31684]]
(2) The Secretary of Defense may waive this requirement if the
Secretary determines that such waiver is critical to the national
security of the United States. In accordance with 10 U.S.C. 2631(c)(2),
DoD shall immediately submit, in writing, a notice to the congressional
committees listed at 10 U.S.C. 2631(e) of such a waiver and the reason
for the waiver.
(d) In accordance with section 1017 of the National Defense
Authorization Act for Fiscal Year 2007 (Pub. L. 109-364), when
obtaining carriage requiring a covered vessel, the contracting officer
shall consider the extent to which offerors have had overhaul, repair,
and maintenance work for covered vessels performed in shipyards located
in the United States or Guam.
(e) In accordance with section 3504 of the National Defense
Authorization Act for Fiscal Year 2009 (Pub. L. 110-417), DoD may not
award, renew or extend, or exercise an option under a charter of, or
contract for carriage of cargo by, a U.S.-flag vessel documented under
46 U.S.C. chapter 121, unless the contract contains the clause at
252.247-7027.
0
6. Amend section 247.573--
0
a. By revising paragraph (a);
0
b. In paragraph (b)--
0
i. By revising paragraph (3);
0
ii. In paragraph (4) by removing ``Procedures are provided at'' and
adding ``Follow the procedures at'' in its place; and
0
iii. By adding a new paragraph (5).
The revisions and addition read as follows:
247.573 General.
(a) Delegated authority. Pursuant to 10 U.S.C. 2631(b)(2), the
Secretary of Defense has delegated (see PGI 247.573) the authority to
make determinations either that a U.S.-flag vessel is not available at
a fair and reasonable rate for commercial vessels of the United States
or is otherwise not available to--
(1) The Commander, United States Transportation Command; and
(2) The Secretary of the Navy.
(b) * * *
* * * * *
(3) See PGI 247.573(b)(3) for agency and department procedures
relating to annual reporting requirements of waivers granted for
nonavailability of U.S.-flag vessels.
* * * * *
(5)(i) In accordance with 10 U.S.C. 2631(d), contracting officers
shall exercise appropriate contractual rights and remedies against
contractors who fail to comply. Such remedies may include the
determination that a contractor is ineligible for award of future
contracts, termination of an existing contract, or suspension or
debarment of the contractor. Also see 242.1502 regarding assessments of
the contractor's past performance.
(ii) In the event of a contractor's unauthorized use of foreign-
flag vessels in the performance of a contract, the contracting officer
is authorized to consider an equitable adjustment.
PART 252--SOLICITATION PROVISIONS AND CONTRACT CLAUSES
0
7. Amend section 252.247-7023--
0
a. Revising the date of the clause;
0
b. By revising paragraph (a);
0
c. By revising paragraph (c);
0
d. In paragraph (d) introductory text by revising the second sentence
and paragraph (7);
0
e. In paragraph (e)(10) by removing ``the steamship company'' and
adding ``the carrier'' in its place;
0
f. In paragraph (f)(3) by removing ``had the written consent of the
Contracting Officer'' and adding ``had received a prior-approved waiver
for U.S.-flag vessels'' in its place;
0
g. In paragraph (f)(4) by removing ``of the Contracting Officer'' and
adding ``of DoD'' in its place;
0
h. Amend Alternate I--
0
i. Revising the date of the clause;
0
ii. By revising paragraph (a);
0
iii. By revising paragraph (c);
0
iv. In paragraph (d) introductory text by revising the second sentence
and paragraph (7);
0
v. In paragraph (e)(10) by removing ``steamship company'' and adding
``the carrier'' in its place;
0
vi. In paragraph (f)(3) by removing ``had the written consent of the
Contracting Officer'' and adding ``had received a prior-approved waiver
for U.S.-flag vessels'' in its place;
0
vii. In paragraph (f)(4) by removing ``of the Contracting Officer'' and
adding ``of DoD'' in its place;
0
i. Amend Alternate II--
0
i. Revising the date of the clause;
0
ii. By revising paragraph (a);
0
iii. By revising paragraph (c);
0
iv. In paragraph (d) introductory text by revising the second sentence
and paragraph (7);
0
v. In paragraph (e)(10) by removing ``steamship company'' and adding
``the carrier'' in its place;
0
vi. In paragraph (f)(3) by removing ``had the written consent of the
Contracting Officer'' and adding ``had received a prior-approved waiver
for U.S.-flag vessels'' in its place; and
0
vii. In paragraph (f)(4) by removing ``of the Contracting Officer'' and
adding ``of DoD'' in its place.
The revisions read as follows:
252.247-7023 Transportation of Supplies by Sea.
* * * * *
Transportation of Supplies by Sea--Basic (Date)
(a) Definitions. As used in this clause--
Foreign-flag vessel means any vessel that is not a U.S.-flag
vessel.
Ocean transportation means any water-borne transportation aboard a
ship, vessel, boat, barge, ferry, or the like outside the internal
waters of the United States as defined in 33 CFR 2.24.
Subcontractor means a supplier, materialman, distributor, or vendor
at any level below the prime contractor whose contractual obligation to
perform results from, or is conditioned upon, award of the prime
contract and who is performing any part of the work or other
requirement of the prime contract.
Supplies means supplies that are clearly identifiable for eventual
use by or owned by DoD at the time of transportation by sea, or are
otherwise transported by DoD, regardless of ownership or use by DoD. An
item is clearly identifiable for eventual use by DoD if, for example,
the contract documentation contains a reference to a DoD contract
number or a military destination.
U.S.-flag vessel means either a vessel belonging to the United
States or a vessel of the United States as that term is defined in 46
U.S.C. 116.
* * * * *
(c) The Contractor and its subcontractors may request, via the
Contracting Officer, a waiver of the requirement to use a U.S.-flag
vessel, or identification of any available U.S.-flag vessels, if the
Contractor or a subcontractor sufficiently explains that--
(1) U.S.-flag vessels are not available at a fair and reasonable
rate for commercial vessels of the United States; or
(2) U.S.-flag vessels are otherwise not available.
(d) * * * The Contracting Officer will process requests submitted
after such date(s) as expeditiously as possible, however, if a DoD
waiver is not approved prior to the shipper's sailing date, this will
not of itself constitute a compensable delay under this or any other
clause of this contract. * * *
* * * * *
(7) A documented description of current, diligent efforts made to
secure U.S.-flag vessels, including points of contact (with names and
telephone numbers) with at least two U.S.-flag
[[Page 31685]]
carriers contacted. Copies of quotes will suffice for this purpose.
Copies of telephone notes, emails, and other relevant communications
will otherwise be considered for this purpose.
* * * * *
Transportation of Supplies by Sea--Alternate I (Date)
(a) Definitions. As used in this clause--
Foreign-flag vessel means any vessel that is not a U.S.-flag
vessel.
Ocean transportation means any water-borne transportation aboard a
ship, vessel, boat, barge, ferry, or the like outside the internal
waters of the United States as defined in 33 CFR 2.24.
Subcontractor means a supplier, materialman, distributor, or vendor
at any level below the prime contractor whose contractual obligation to
perform results from, or is conditioned upon, award of the prime
contract and who is performing any part of the work or other
requirement of the prime contract.
Supplies means supplies that are clearly identifiable for eventual
use by or owned by DoD at the time of transportation by sea, or are
otherwise transported by DoD, regardless of ownership or use by DoD. An
item is clearly identifiable for eventual use by DoD if, for example,
the contract documentation contains a reference to a DoD contract
number or a military destination.
U.S.-flag vessel means either a vessel belonging to the United
States or a vessel of the United States as that term is defined in 46
U.S.C. 116.
* * * * *
(c) The Contractor and its subcontractors may request, via the
Contracting Officer, a waiver of the requirement to use a U.S.-flag
vessel, or identification of any available U.S.-flag vessels, if the
Contractor or a subcontractor sufficiently explains that--
(1) U.S.-flag vessels are not available at a fair and reasonable
rate for commercial vessels of the United States; or
(2) U.S.-flag vessels are otherwise not available.
(d) * * * The Contracting Officer will process requests submitted
after such date(s) as expeditiously as possible, however, if a DoD
waiver is not approved prior to the shipper's sailing date, this will
not of itself constitute a compensable delay under this or any other
clause of this contract. * * *
* * * * *
(7) A documented description of current, diligent efforts made to
secure U.S.-flag vessels, including points of contact (with names and
telephone numbers) with at least two U.S.-flag carriers contacted.
Copies of quotes will suffice for this purpose. Copies of telephone
notes, emails, and other relevant communications will otherwise be
considered for this purpose.
* * * * *
Transportation of Supplies By Sea--Alternate II (Date)
(a) Definitions. As used in this clause--
Foreign-flag vessel means any vessel that is not a U.S.-flag
vessel.
Ocean transportation means any water-borne transportation aboard a
ship, vessel, boat, barge, ferry, or the like outside the internal
waters of the United States as defined in 33 CFR 2.24.
Subcontractor means a supplier, materialman, distributor, or vendor
at any level below the prime contractor whose contractual obligation to
perform results from, or is conditioned upon, award of the prime
contract and who is performing any part of the work or other
requirement of the prime contract.
Supplies means supplies that are clearly identifiable for eventual
use by or owned by DoD at the time of transportation by sea, or are
otherwise transported by DoD, regardless of ownership or use by DoD. An
item is clearly identifiable for eventual use by DoD if, for example,
the contract documentation contains a reference to a DoD contract
number or a military destination.
U.S.-flag vessel means either a vessel belonging to the United
States or a vessel of the United States as that term is defined in 46
U.S.C. 116.
* * * * *
(c) The Contractor and its subcontractors may request, via the
Contracting Officer, a waiver of the requirement to use a U.S.-flag
vessel, or identification of any available U.S.-flag vessels, if the
Contractor or a subcontractor sufficiently explains that--
(1) U.S.-flag vessels are not available at a fair and reasonable
rate for commercial vessels of the United States; or
(2) U.S.-flag vessels are otherwise not available.
(d) * * * The Contracting Officer will process requests submitted
after such date(s) as expeditiously as possible, however, if a DoD
waiver is not approved prior to the shipper's sailing date, this will
not of itself constitute a compensable delay under this or any other
clause of this contract. * * *
(7) A documented description of current, diligent efforts made to
secure U.S.-flag vessels, including points of contact (with names and
telephone numbers) with at least two U.S.-flag carriers contacted.
Copies of quotes will suffice for this purpose. Copies of telephone
notes, emails, and other relevant communications will otherwise be
considered for this purpose.
* * * * *
0
8. Revise section 252.247-7025 to read as follows:
252.247-7025 Reflagging or Repair Work.
As prescribed in 247.574(c), use the following clause:
Reflagging or Repair Work (Date)
(a) Definitions. As used in this clause--
Corrective and preventive maintenance or repair means--
(1) Maintenance or repair actions performed as a result of a
failure in order to return or restore equipment to acceptable
performance levels; and
(2) Scheduled maintenance or repair actions to prevent or
discover functional failures.
Reflagging or repair work means work performed on a vessel--
(1) To enable the vessel to meet applicable standards to become
a vessel of the United States; or
(2) To convert the vessel to a more useful military
configuration.
(b) Requirement. Unless DoD waives this requirement, the
Contractor shall ensure performance of the following in the United
States or its outlying areas:
(1) Reflagging or repair work, if the reflagging or repair work
is performed--
(i) On a vessel for which the Contractor submitted an offer in
response to the solicitation for this contract; and
(ii) Prior to acceptance of the vessel by the Government.
(2) Corrective and preventive maintenance or repair work for the
duration of the contract, to the greatest extent practicable.
(End of clause)
0
9. Amend section 252.247-7026--
0
a. By removing the provision date ``Nov 2008'' and adding ``Date'' in
its place;
0
b. In paragraph (a) by revising the definitions of ``Covered vessel''
and ``Foreign shipyard'' and removing the definition of ``Shipyard'';
0
c. In paragraphs (b) and (c) by removing ``offeror'' and adding
``Offeror'' in its place;
0
d. In paragraph (e) removing ``Section 1017 of Public Law 109-364'' and
adding ``section 1017 of Public Law 109-364 (10 U.S.C. 2631 note)'' in
its place.
The revisions read as follows:
252.247-7026 Evaluation Preference for Use of Domestic Shipyards--
Applicable to Acquisition of Carriage by Vessel for DoD Cargo in the
Coastwise or Noncontiguous Trade.
* * * * *
[[Page 31686]]
(a) * * *
Covered vessel means a vessel--
(1) Owned, operated, or controlled by the offeror; and
(2) Qualified to engage in the carriage of cargo in the coastwise
or noncontiguous trade under 46 U.S.C. 12112 and 50501 and 46 U.S.C.
chapter 551.
Foreign shipyard means a shipyard that is not located in the United
States.
* * * * *
[FR Doc. 2024-08436 Filed 4-24-24; 8:45 am]
BILLING CODE 6001-FR-P
