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    <AMDDATE>Oct. 1, 2024</AMDDATE>
    <FMTR>
        <TITLEPG>
            <CODE/>
            <PRTPAGE P="1"/>
            <TITLENUM>Title 48</TITLENUM>
            <SUBJECT>Federal Acquisition Regulations System</SUBJECT>
            <PARTS>Chapter 2</PARTS>
            <REVISED>Revised as of October 1, 2024</REVISED>
            <CONTAINS>Containing a codification of documents of general applicability and future effect</CONTAINS>
            <DATE>As of October 1, 2024</DATE>
            <PUB>
                <P>Published by the Office of the Federal Register National Archives and Records Administration as a Special Edition of the Federal Register</P>
            </PUB>
        </TITLEPG>
        <BTITLE>
            <OENOTICE>
                <PRTPAGE P="?ii"/>
                <HD SOURCE="HED">U.S. GOVERNMENT OFFICIAL EDITION NOTICE</HD>
                <HD SOURCE="HED">Legal Status and Use of Seals and Logos</HD>
                <GPH SPAN="1" DEEP="54" HTYPE="LEFT">
                    <GID>archives.ai</GID>
                </GPH>
                <P>The seal of the National Archives and Records Administration (NARA) authenticates the Code of Federal Regulations (CFR) as the official codification of Federal regulations established under the Federal Register Act. Under the provisions of 44 U.S.C. 1507, the contents of the CFR, a special edition of the Federal Register, shall be judicially noticed. The CFR is prima facie evidence of the original documents published in the Federal Register (44 U.S.C. 1510).</P>
                <P>It is prohibited to use NARA's official seal and the stylized Code of Federal Regulations logo on any republication of this material without the express, written permission of the Archivist of the United States or the Archivist's designee. Any person using NARA's official seals and logos in a manner inconsistent with the provisions of 36 CFR part 1200 is subject to the penalties specified in 18 U.S.C. 506, 701, and 1017.</P>
                <HD SOURCE="HED">Use of ISBN Prefix</HD>
                <P>This is the Official U.S. Government edition of this publication and is herein identified to certify its authenticity. Use of the 0-16 ISBN prefix is for U.S. Government Publishing Office Official Editions only. The Superintendent of Documents of the U.S. Government Publishing Office requests that any reprinted edition clearly be labeled as a copy of the authentic work with a new ISBN.</P>
            </OENOTICE>
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                    <GID>e:\seals\gpologo2.eps</GID>
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                <P>U . S . G O V E R N M E N T P U B L I S H I N G O F F I C E</P>
            </GPO>
            <SUDOCS>
                <P>U.S. Superintendent of Documents • Washington, DC 20402-0001</P>
                <P>http://bookstore.gpo.gov</P>
                <P>Phone: toll-free (866) 512-1800; DC area (202) 512-1800</P>
            </SUDOCS>
        </BTITLE>
        <TOC>
            <PRTPAGE P="iii"/>
            <HD SOURCE="HED">Table of Contents</HD>
            <PGHD>Page</PGHD>
            <EXPL>
                <SUBJECT>Explanation</SUBJECT>
                <PG>v</PG>
            </EXPL>
            <TITLENO>
                <HD SOURCE="HED">Title 48:</HD>
                <CHAPTI>
                    <SUBJECT>Chapter 2—Defense Acquisition Regulations System, Department of Defense</SUBJECT>
                    <PG>3</PG>
                </CHAPTI>
            </TITLENO>
            <FAIDS>
                <HD SOURCE="HED">Finding Aids:</HD>
                <SUBJECT>Table of CFR Titles and Chapters</SUBJECT>
                <PG>801</PG>
                <SUBJECT>Alphabetical List of Agencies Appearing in the CFR</SUBJECT>
                <PG>821</PG>
                <SUBJECT>List of CFR Sections Affected</SUBJECT>
                <PG>831</PG>
            </FAIDS>
        </TOC>
        <CITE>
            <PRTPAGE P="iv"/>
            <P>
                Cite this Code: 
                <E T="01">CFR</E>
            </P>
            <CITEP>
                To cite the regulations in this volume use title, part and section number. Thus, 
                <E T="01">48 CFR 201.101</E>
                 refers to title 48, part 201, section 101.
            </CITEP>
        </CITE>
        <EXPLA>
            <PRTPAGE P="v"/>
            <HD SOURCE="HED">Explanation</HD>
            <P>The Code of Federal Regulations is a codification of the general and permanent rules published in the Federal Register by the Executive departments and agencies of the Federal Government. The Code is divided into 50 titles which represent broad areas subject to Federal regulation. Each title is divided into chapters which usually bear the name of the issuing agency. Each chapter is further subdivided into parts covering specific regulatory areas.</P>
            <P>Each volume of the Code is revised at least once each calendar year and issued on a quarterly basis approximately as follows:</P>
            <IPAR>
                <P SOURCE="P1">Title 1 through Title 16 </P>
                <STUB>as of January 1</STUB>
                <P SOURCE="P1">Title 17 through Title 27 </P>
                <STUB>as of April 1</STUB>
                <P SOURCE="P1">Title 28 through Title 41 </P>
                <STUB>as of July 1</STUB>
                <P SOURCE="P1">Title 42 through Title 50 </P>
                <STUB>as of October 1</STUB>
            </IPAR>
            <P>The appropriate revision date is printed on the cover of each volume.</P>
            <SIDEHED>
                <HD SOURCE="HED">LEGAL STATUS</HD>
                <P>The contents of the Federal Register are required to be judicially noticed (44 U.S.C. 1507). The Code of Federal Regulations is prima facie evidence of the text of the original documents (44 U.S.C. 1510).</P>
            </SIDEHED>
            <SIDEHED>
                <HD SOURCE="HED">HOW TO USE THE CODE OF FEDERAL REGULATIONS</HD>
                <P>The Code of Federal Regulations is kept up to date by the individual issues of the Federal Register. These two publications must be used together to determine the latest version of any given rule.</P>
                <P>To determine whether a Code volume has been amended since its revision date (in this case, October 1, 2024), consult the “List of CFR Sections Affected (LSA),” which is issued monthly, and the “Cumulative List of Parts Affected,” which appears in the Reader Aids section of the daily Federal Register. These two lists will identify the Federal Register page number of the latest amendment of any given rule.</P>
            </SIDEHED>
            <SIDEHED>
                <HD SOURCE="HED">EFFECTIVE AND EXPIRATION DATES</HD>
                <P>Each volume of the Code contains amendments published in the Federal Register since the last revision of that volume of the Code. Source citations for the regulations are referred to by volume number and page number of the Federal Register and date of publication. Publication dates and effective dates are usually not the same and care must be exercised by the user in determining the actual effective date. In instances where the effective date is beyond the cut-off date for the Code a note has been inserted to reflect the future effective date. In those instances where a regulation published in the Federal Register states a date certain for expiration, an appropriate note will be inserted following the text.</P>
            </SIDEHED>
            <SIDEHED>
                <HD SOURCE="HED">OMB CONTROL NUMBERS</HD>
                <P>
                    The Paperwork Reduction Act of 1980 (Pub. L. 96-511) requires Federal agencies to display an OMB control number with their information collection request. 
                    <PRTPAGE P="vi"/>
                    Many agencies have begun publishing numerous OMB control numbers as amendments to existing regulations in the CFR. These OMB numbers are placed as close as possible to the applicable recordkeeping or reporting requirements.
                </P>
            </SIDEHED>
            <SIDEHED>
                <HD SOURCE="HED">PAST PROVISIONS OF THE CODE</HD>
                <P>Provisions of the Code that are no longer in force and effect as of the revision date stated on the cover of each volume are not carried. Code users may find the text of provisions in effect on any given date in the past by using the appropriate List of CFR Sections Affected (LSA). For the convenience of the reader, a “List of CFR Sections Affected” is published at the end of each CFR volume. For changes to the Code prior to the LSA listings at the end of the volume, consult previous annual editions of the LSA. For changes to the Code prior to 2001, consult the List of CFR Sections Affected compilations, published for 1949-1963, 1964-1972, 1973-1985, and 1986-2000.</P>
            </SIDEHED>
            <SIDEHED>
                <HD SOURCE="HED">“[RESERVED]” TERMINOLOGY</HD>
                <P>The term “[Reserved]” is used as a place holder within the Code of Federal Regulations. An agency may add regulatory information at a “[Reserved]” location at any time. Occasionally “[Reserved]” is used editorially to indicate that a portion of the CFR was left vacant and not dropped in error.</P>
            </SIDEHED>
            <SIDEHED>
                <HD SOURCE="HED">INCORPORATION BY REFERENCE</HD>
                <P>
                    <E T="03">What is incorporation by reference?</E>
                     Incorporation by reference was established by statute and allows Federal agencies to meet the requirement to publish regulations in the Federal Register by referring to materials already published elsewhere. For an incorporation to be valid, the Director of the Federal Register must approve it. The legal effect of incorporation by reference is that the material is treated as if it were published in full in the Federal Register (5 U.S.C. 552(a)). This material, like any other properly issued regulation, has the force of law.
                </P>
                <P>
                    <E T="03">What is a proper incorporation by reference?</E>
                     The Director of the Federal Register will approve an incorporation by reference only when the requirements of 1 CFR part 51 are met. Some of the elements on which approval is based are:
                </P>
                <P>(a) The incorporation will substantially reduce the volume of material published in the Federal Register.</P>
                <P>(b) The matter incorporated is in fact available to the extent necessary to afford fairness and uniformity in the administrative process.</P>
                <P>(c) The incorporating document is drafted and submitted for publication in accordance with 1 CFR part 51.</P>
                <P>
                    <E T="03">What if the material incorporated by reference cannot be found?</E>
                     If you have any problem locating or obtaining a copy of material listed as an approved incorporation by reference, please contact the agency that issued the regulation containing that incorporation. If, after contacting the agency, you find the material is not available, please notify the Director of the Federal Register, National Archives and Records Administration, 8601 Adelphi Road, College Park, MD 20740-6001, or call 202-741-6010.
                </P>
            </SIDEHED>
            <SIDEHED>
                <HD SOURCE="HED">CFR INDEXES AND TABULAR GUIDES</HD>
                <P>
                    A subject index to the Code of Federal Regulations is contained in a separate volume, revised annually as of January 1, entitled CFR 
                    <E T="04">Index and Finding Aids.</E>
                     This volume contains the Parallel Table of Authorities and Rules. A list of CFR titles, chapters, subchapters, and parts and an alphabetical list of agencies publishing in the CFR are also included in this volume.
                </P>
                <P>
                    An index to the text of “Title 3—The President” is carried within that volume.
                    <PRTPAGE P="vii"/>
                </P>
                <P>The Federal Register Index is issued monthly in cumulative form. This index is based on a consolidation of the “Contents” entries in the daily Federal Register.</P>
                <P>A List of CFR Sections Affected (LSA) is published monthly, keyed to the revision dates of the 50 CFR titles.</P>
            </SIDEHED>
            <SIDEHED>
                <HD SOURCE="HED">REPUBLICATION OF MATERIAL</HD>
                <P>There are no restrictions on the republication of material appearing in the Code of Federal Regulations.</P>
            </SIDEHED>
            <SIDEHED>
                <HD SOURCE="HED">INQUIRIES</HD>
                <P>For a legal interpretation or explanation of any regulation in this volume, contact the issuing agency. The issuing agency's name appears at the top of odd-numbered pages.</P>
                <P>
                    For inquiries concerning CFR reference assistance, call 202-741-6000 or write to the Director, Office of the Federal Register, National Archives and Records Administration, 8601 Adelphi Road, College Park, MD 20740-6001 or e-mail 
                    <E T="03">fedreg.info@nara.gov.</E>
                </P>
            </SIDEHED>
            <SIDEHED>
                <HD SOURCE="HED">SALES</HD>
                <P>The Government Publishing Office (GPO) processes all sales and distribution of the CFR. For payment by credit card, call toll-free, 866-512-1800, or DC area, 202-512-1800, M-F 8 a.m. to 4 p.m. e.s.t. or fax your order to 202-512-2104, 24 hours a day. For payment by check, write to: US Government Publishing Office - New Orders, P.O. Box 979050, St. Louis, MO 63197-9000.</P>
            </SIDEHED>
            <SIDEHED>
                <HD SOURCE="HED">ELECTRONIC SERVICES</HD>
                <P>
                    The full text of the Code of Federal Regulations, the LSA (List of CFR Sections Affected), The United States Government Manual, the Federal Register, Public Laws, Public Papers of the Presidents of the United States, Compilation of Presidential Documents and the Privacy Act Compilation are available in electronic format via 
                    <E T="03">www.govinfo.gov.</E>
                     For more information, contact the GPO Customer Contact Center, U.S. Government Publishing Office. Phone 202-512-1800, or 866-512-1800 (toll-free). E-mail, 
                    <E T="03">ContactCenter@gpo.gov.</E>
                </P>
                <P>
                    The Office of the Federal Register also offers a free service on the National Archives and Records Administration's (NARA) website for public law numbers, Federal Register finding aids, and related information. Connect to NARA's website at 
                    <E T="03">www.archives.gov/federal-register.</E>
                </P>
                <P>
                    The eCFR is a regularly updated, unofficial editorial compilation of CFR material and Federal Register amendments, produced by the Office of the Federal Register and the Government Publishing Office. It is available at 
                    <E T="03">www.ecfr.gov.</E>
                </P>
                <P>
                    <E T="04">Oliver A. Potts,</E>
                </P>
                <P>
                    <E T="03">Director,</E>
                </P>
                <P>
                    <E T="03">Office of the Federal Register</E>
                </P>
                <P>
                    <E T="03">October 1, 2024</E>
                </P>
            </SIDEHED>
            <SIG>
                <NAME> </NAME>
                <POSITION> </POSITION>
                <OFFICE> </OFFICE>
            </SIG>
            <DATE> </DATE>
        </EXPLA>
        <THISTITL>
            <PRTPAGE P="ix"/>
            <HD SOURCE="HED">THIS TITLE</HD>
            <P>
                Title 48—
                <E T="04">Federal Acquisition Regulations System</E>
                 is composed of seven volumes. The chapters in these volumes are arranged as follows: Chapter 1 (parts 1 to 51), chapter 1 (parts 52 to 99), chapter 2, chapters 3 to 6, chapters 7 to 14, chapters 15 to 28, and chapter 29 to end. The contents of these volumes represent all current regulations codified under this title of the CFR as of October 1, 2024.
            </P>
            <P>
                The Federal acquisition regulations in chapter 1 are those government-wide acquisition regulations jointly issued by the General Services Administration, the Department of Defense, and the National Aeronautics and Space Administration. Chapters 2 through 99 are acquisition regulations issued by individual government agencies. Parts 1 to 69 in each of chapters 2 through 99 are reserved for agency regulations 
                <E T="03">implementing</E>
                 the Federal acquisition regulations in chapter 1 and are numerically keyed to them. Parts 70 to 99 in chapters 2 through 99 contain agency regulations 
                <E T="03">supplementing</E>
                 the Federal acquisition regulations.
            </P>
            <P>The OMB control numbers for the Federal Acquisition Regulations System appear in section 1.106 of chapter 1. For the convenience of the user section 1.106 is reprinted in the Finding Aids section of the second volume containing chapter 1 (parts 52 to 99).</P>
            <P>The first volume, containing chapter 1 (parts 1 to 51), includes an index to the Federal acquisition regulations.</P>
            <P>For this volume, Susannah C. Hurley was Chief Editor. The Code of Federal Regulations publication program is under the direction of John Hyrum Martinez, assisted by Stephen J. Frattini.</P>
        </THISTITL>
    </FMTR>
    <TITLE>
        <LRH>48 CFR Ch. 2 (10-1-24 Edition)</LRH>
        <RRH>Defense Acquisition Regulations System, DoD</RRH>
        <CFRTITLE>
            <TITLEHD>
                <PRTPAGE P="1"/>
                <HD SOURCE="HED">Title 48—Federal Acquisition Regulations System</HD>
                <P>(This book contains chapter 2, parts 201 to 299)</P>
            </TITLEHD>
            <CFRTOC>
                <PTHD>Part</PTHD>
                <CHAPTI>
                    <SUBJECT>
                        <E T="04">chapter 2</E>
                        —Defense Acquisition Regulations System, Department of Defense
                    </SUBJECT>
                    <PG>201</PG>
                </CHAPTI>
            </CFRTOC>
        </CFRTITLE>
        <CHAPTER>
            <TOC>
                <TOCHD>
                    <PRTPAGE P="3"/>
                    <HD SOURCE="HED">CHAPTER 2—DEFENSE ACQUISITION REGULATIONS SYSTEM, DEPARTMENT OF DEFENSE</HD>
                </TOCHD>
                <SUBCHAP>
                    <HD SOURCE="HED">SUBCHAPTER A—GENERAL</HD>
                </SUBCHAP>
                <PTHD>Part</PTHD>
                <PGHD>Page</PGHD>
                <CHAPTI>
                    <PT>200</PT>
                    <RESERVED>[Reserved]</RESERVED>
                    <PT>201</PT>
                    <SUBJECT>Federal Acquisition Regulations System</SUBJECT>
                    <PG>7</PG>
                    <PT>202</PT>
                    <SUBJECT>Definitions of words and terms</SUBJECT>
                    <PG>14</PG>
                    <PT>203</PT>
                    <SUBJECT>Improper business practices and personal conflicts of interest</SUBJECT>
                    <PG>17</PG>
                    <PT>204</PT>
                    <SUBJECT>Administrative and information matters</SUBJECT>
                    <PG>23</PG>
                </CHAPTI>
                <SUBCHAP>
                    <HD SOURCE="HED">SUBCHAPTER B—ACQUISITION PLANNING</HD>
                </SUBCHAP>
                <CHAPTI>
                    <PT>205</PT>
                    <SUBJECT>Publicizing contract actions</SUBJECT>
                    <PG>47</PG>
                    <PT>206</PT>
                    <SUBJECT>Competition requirements</SUBJECT>
                    <PG>49</PG>
                    <PT>207</PT>
                    <SUBJECT>Acquisition planning</SUBJECT>
                    <PG>53</PG>
                    <PT>208</PT>
                    <SUBJECT>Required sources of supplies and services</SUBJECT>
                    <PG>59</PG>
                    <PT>209</PT>
                    <SUBJECT>Contractor qualifications</SUBJECT>
                    <PG>65</PG>
                    <PT>210</PT>
                    <SUBJECT>Market research</SUBJECT>
                    <PG>76</PG>
                    <PT>211</PT>
                    <SUBJECT>Describing agency needs</SUBJECT>
                    <PG>77</PG>
                    <PT>212</PT>
                    <SUBJECT>Acquisition of commercial products and commercial services</SUBJECT>
                    <PG>81</PG>
                </CHAPTI>
                <SUBCHAP>
                    <HD SOURCE="HED">SUBCHAPTER C—CONTRACTING METHODS AND CONTRACT TYPES</HD>
                </SUBCHAP>
                <CHAPTI>
                    <PT>213</PT>
                    <SUBJECT>Simplified acquisition procedures</SUBJECT>
                    <PG>96</PG>
                    <PT>214</PT>
                    <SUBJECT>Sealed bidding</SUBJECT>
                    <PG>101</PG>
                    <PT>215</PT>
                    <SUBJECT>Contracting by negotiation</SUBJECT>
                    <PG>102</PG>
                    <PT>216</PT>
                    <SUBJECT>Types of contracts</SUBJECT>
                    <PG>132</PG>
                    <PT>217</PT>
                    <SUBJECT>Special contracting methods</SUBJECT>
                    <PG>140</PG>
                    <PT>218</PT>
                    <SUBJECT>Emergency acquisitions</SUBJECT>
                    <PG>157</PG>
                </CHAPTI>
                <SUBCHAP>
                    <HD SOURCE="HED">SUBCHAPTER D—SOCIOECONOMIC PROGRAMS</HD>
                </SUBCHAP>
                <CHAPTI>
                    <PT>219</PT>
                    <SUBJECT>Small business programs</SUBJECT>
                    <PG>161</PG>
                    <PT>222</PT>
                    <SUBJECT>Application of labor laws to Government acquisitions</SUBJECT>
                    <PG>
                        170
                        <PRTPAGE P="4"/>
                    </PG>
                    <PT>223</PT>
                    <SUBJECT>Environment, sustainable acquisition, and material safety</SUBJECT>
                    <PG>180</PG>
                    <PT>224</PT>
                    <SUBJECT>Protection of privacy and freedom of information</SUBJECT>
                    <PG>186</PG>
                    <PT>225</PT>
                    <SUBJECT>Foreign acquisition</SUBJECT>
                    <PG>186</PG>
                    <PT>226</PT>
                    <SUBJECT>Other socioeconomic programs</SUBJECT>
                    <PG>253</PG>
                </CHAPTI>
                <SUBCHAP>
                    <HD SOURCE="HED">SUBCHAPTER E—GENERAL CONTRACTING REQUIREMENTS</HD>
                </SUBCHAP>
                <CHAPTI>
                    <PT>227</PT>
                    <SUBJECT>Patents, data, and copyrights</SUBJECT>
                    <PG>257</PG>
                    <PT>228</PT>
                    <SUBJECT>Bonds and insurance</SUBJECT>
                    <PG>301</PG>
                    <PT>229</PT>
                    <SUBJECT>Taxes</SUBJECT>
                    <PG>308</PG>
                    <PT>230</PT>
                    <SUBJECT>Cost accounting standards administration</SUBJECT>
                    <PG>311</PG>
                    <PT>231</PT>
                    <SUBJECT>Contract cost principles and procedures</SUBJECT>
                    <PG>311</PG>
                    <PT>232</PT>
                    <SUBJECT>Contract financing</SUBJECT>
                    <PG>316</PG>
                    <PT>233</PT>
                    <SUBJECT>Protests, disputes, and appeals</SUBJECT>
                    <PG>331</PG>
                </CHAPTI>
                <SUBCHAP>
                    <HD SOURCE="HED">SUBCHAPTER F—SPECIAL CATEGORIES OF CONTRACTING</HD>
                </SUBCHAP>
                <CHAPTI>
                    <PT>234</PT>
                    <SUBJECT>Major system acquisition</SUBJECT>
                    <PG>334</PG>
                    <PT>235</PT>
                    <SUBJECT>Research and development contracting</SUBJECT>
                    <PG>341</PG>
                    <PT>236</PT>
                    <SUBJECT>Construction and architect-engineer contracts</SUBJECT>
                    <PG>345</PG>
                    <PT>237</PT>
                    <SUBJECT>Service contracting</SUBJECT>
                    <PG>350</PG>
                    <PT>239</PT>
                    <SUBJECT>Acquisition of information technology</SUBJECT>
                    <PG>368</PG>
                    <PT>241</PT>
                    <SUBJECT>Acquisition of utility services</SUBJECT>
                    <PG>379</PG>
                </CHAPTI>
                <SUBCHAP>
                    <HD SOURCE="HED">SUBCHAPTER G—CONTRACT MANAGEMENT</HD>
                </SUBCHAP>
                <CHAPTI>
                    <PT>242</PT>
                    <SUBJECT>Contract administration and audit services</SUBJECT>
                    <PG>382</PG>
                    <PT>243</PT>
                    <SUBJECT>Contract modifications</SUBJECT>
                    <PG>396</PG>
                    <PT>244</PT>
                    <SUBJECT>Subcontracting policies and procedures</SUBJECT>
                    <PG>399</PG>
                    <PT>245</PT>
                    <SUBJECT>Government property</SUBJECT>
                    <PG>402</PG>
                    <PT>246</PT>
                    <SUBJECT>Quality assurance</SUBJECT>
                    <PG>408</PG>
                    <PT>247</PT>
                    <SUBJECT>Transportation</SUBJECT>
                    <PG>418</PG>
                    <PT>249</PT>
                    <SUBJECT>Termination of contracts</SUBJECT>
                    <PG>424</PG>
                    <PT>250</PT>
                    <SUBJECT>Extraordinary contractual actions and the Safety Act</SUBJECT>
                    <PG>427</PG>
                    <PT>251</PT>
                    <SUBJECT>Use of Government sources by contractors</SUBJECT>
                    <PG>429</PG>
                </CHAPTI>
                <SUBCHAP>
                    <HD SOURCE="HED">SUBCHAPTER H—CLAUSES AND FORMS</HD>
                </SUBCHAP>
                <CHAPTI>
                    <PT>252</PT>
                    <SUBJECT>Solicitation provisions and contract clauses</SUBJECT>
                    <PG>431</PG>
                    <PT>253</PT>
                    <SUBJECT>Forms</SUBJECT>
                    <PG>756</PG>
                </CHAPTI>
                <SUBCHAP>
                    <HD SOURCE="HED">SUBCHAPTER I—AGENCY SUPPLEMENTARY REGULATIONS</HD>
                </SUBCHAP>
                <CHAPTI>
                    <PT> </PT>
                    <SUBJECT>Appendix A—Armed Services Board of Contract Appeals</SUBJECT>
                    <PG>759</PG>
                    <PT> </PT>
                    <RESERVED>Appendixes B-E [Reserved]</RESERVED>
                    <PT> </PT>
                    <SUBJECT>Appendix F—Material Inspection and Receiving Report</SUBJECT>
                    <PG>771</PG>
                    <PT> </PT>
                    <RESERVED>
                        Appendix G [Reserved]
                        <PRTPAGE P="5"/>
                    </RESERVED>
                    <PT> </PT>
                    <SUBJECT>Appendix H—Debarment and Suspension Procedures</SUBJECT>
                    <PG>788</PG>
                    <PT> </PT>
                    <SUBJECT>Appendix I—Policy and Procedures for the DoD Mentor-Protégé Program</SUBJECT>
                    <PG>789</PG>
                    <PT>254-299</PT>
                    <RESERVED>[Reserved]</RESERVED>
                </CHAPTI>
            </TOC>
            <SUBCHAP TYPE="N">
                <PRTPAGE P="7"/>
                <HD SOURCE="HED">SUBCHAPTER A—GENERAL</HD>
                <PART>
                    <RESERVED>PART 200 [RESERVED]</RESERVED>
                </PART>
                <PART>
                    <EAR>Pt. 201</EAR>
                    <HD SOURCE="HED">PART 201—FEDERAL ACQUISITION REGULATIONS SYSTEM</HD>
                    <CONTENTS>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 201.1—Purpose, Authority, Issuance</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>201.101</SECTNO>
                            <SUBJECT>Purpose.</SUBJECT>
                            <SECTNO>201.104</SECTNO>
                            <SUBJECT>Applicability.</SUBJECT>
                            <SECTNO>201.105</SECTNO>
                            <SUBJECT>Issuance.</SUBJECT>
                            <SECTNO>201.105-3</SECTNO>
                            <SUBJECT>Copies.</SUBJECT>
                            <SECTNO>201.106</SECTNO>
                            <SUBJECT>OMB approval under the Paperwork Reduction Act.</SUBJECT>
                            <SECTNO>201.107</SECTNO>
                            <SUBJECT>Certifications.</SUBJECT>
                            <SECTNO>201.109</SECTNO>
                            <SUBJECT>Statutory acquisition-related dollar thresholds-adjustment for inflation.</SUBJECT>
                            <SECTNO>201.170</SECTNO>
                            <SUBJECT>Peer reviews.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 201.2—Administration</HD>
                            <SECTNO>201.201</SECTNO>
                            <SUBJECT>Maintenance of the FAR.</SUBJECT>
                            <SECTNO>201.201-1</SECTNO>
                            <SUBJECT>The two councils.</SUBJECT>
                            <SECTNO>201.201-70</SECTNO>
                            <SUBJECT>Maintenance of Procedures, Guidance, and Information.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 201.3—Agency Acquisition Regulations</HD>
                            <SECTNO>201.301</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>201.303</SECTNO>
                            <SUBJECT>Publication and codification.</SUBJECT>
                            <SECTNO>201.304</SECTNO>
                            <SUBJECT>Agency control and compliance procedures.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 201.4—Deviations From the FAR</HD>
                            <SECTNO>201.402</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>201.403</SECTNO>
                            <SUBJECT>Individual deviations.</SUBJECT>
                            <SECTNO>201.404</SECTNO>
                            <SUBJECT>Class deviations.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 201.6—Career Development, Contracting Authority, and Responsibilities</HD>
                            <SECTNO>201.602</SECTNO>
                            <SUBJECT>Contracting officers.</SUBJECT>
                            <SECTNO>201.602-2</SECTNO>
                            <SUBJECT>Responsibilities.</SUBJECT>
                            <SECTNO>201.602-70</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <SECTNO>201.603</SECTNO>
                            <SUBJECT>Selection, appointment, and termination of appointment for contracting officers.</SUBJECT>
                            <SECTNO>201.603-2</SECTNO>
                            <SUBJECT>Selection.</SUBJECT>
                            <SECTNO>201.603-3</SECTNO>
                            <SUBJECT>Appointment.</SUBJECT>
                            <SECTNO>201.670</SECTNO>
                            <SUBJECT>Appointment of property administrators and plant clearance officers. </SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36284, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 201.1—Purpose, Authority, Issuance</HD>
                        <SECTION>
                            <SECTNO>201.101</SECTNO>
                            <SUBJECT>Purpose.</SUBJECT>
                            <P>(1) The defense acquisition system, as defined in 10 U.S.C. 3001(a), exists to manage the investments of the United States in technologies, programs, and product support necessary to achieve the national security strategy prescribed by the President pursuant to section 108 of the National Security Act of 1947 (50 U.S.C. 3043) and to support the United States Armed Forces.</P>
                            <P>(2) The investment strategy of DoD shall be postured to support not only the current United States armed forces, but also future armed forces of the United States.</P>
                            <P>(3) The primary objective of DoD acquisition is to acquire quality supplies and services that satisfy user needs with measurable improvements to mission capability and operational support at a fair and reasonable price.</P>
                            <CITA>[83 FR 19641, May 4, 2018, as amended at 87 FR 76989, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>201.104</SECTNO>
                            <SUBJECT>Applicability.</SUBJECT>
                            <P>The FAR and the Defense Federal Acquisition Regulation Supplement (DFARS) also apply to purchases and contracts by DoD contracting activities made in support of foreign military sales or North Atlantic Treaty Organization cooperative projects without regard to the nature or sources of funds obligated, unless otherwise specified in this regulation.</P>
                            <CITA>[56 FR 36284, July 31, 1991. Redesignated at 64 FR 39430, July 22, 1999]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>201.105</SECTNO>
                            <SUBJECT>Issuance.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>201.105-3</SECTNO>
                            <SUBJECT>Copies.</SUBJECT>
                            <P>
                                The DFARS and the DFARS Procedures, Guidance, and Information (PGI) are available at 
                                <E T="03">https://www.acq.osd.mil/dpap/dars/dfarspgi/current/index.html.</E>
                            </P>
                            <CITA>[88 FR 73234, Oct. 25, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="8"/>
                            <SECTNO>201.106</SECTNO>
                            <SUBJECT>OMB approval under the Paperwork Reduction Act.</SUBJECT>
                            <P>See PGI 201.106 for a list of the information collection and recordkeeping requirements contained in this regulation that have been approved by the Office of Management and Budget.</P>
                            <CITA>[80 FR 67255, Oct. 30, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>201.107</SECTNO>
                            <SUBJECT>Certifications.</SUBJECT>
                            <P>In accordance with 41 U.S.C. 1304, a new requirement for a certification by a contractor or offeror may not be included in the DFARS unless—</P>
                            <P>(1) The certification requirement is specifically imposed by statute; or</P>
                            <P>(2) Written justification for such certification is provided to the Secretary of Defense by the Under Secretary of Defense (Acquisition and Sustainment), and the Secretary of Defense approves in writing the inclusion of such certification requirement.</P>
                            <CITA>[63 FR 11528, Mar. 9, 1998, as amended at 65 FR 39704, June 27, 2000; 76 FR 58137, Sept. 20, 2011; 77 FR 35879, June 15, 2012; 88 FR 73234, Oct. 25, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>201.109</SECTNO>
                            <SUBJECT>Statutory acquisition-related dollar thresholds-adjustment for inflation.</SUBJECT>
                            <P>(a)(i) 41 U.S.C. 1908(d) requires the adjustment for inflation of all statutory acquisition-related dollar thresholds in the DFARS be applied to contracts and subcontracts without regard to the date of award of the contract or subcontract, except thresholds based on the Wage Rate Requirements statute, the Service Contract Labor Standards statute, or established by the United States Trade Representative pursuant to the Trade Agreement Act, which are not escalated by the statute.</P>
                            <P>(ii) Section 814(b) of the National Defense Authorization Act for Fiscal Year 2012 (Pub. L. 112-81) requires that the threshold established in 10 U.S.C. 2253(a)(2) for the acquisition of right-hand drive passenger sedans be included in the list of dollar thresholds that are subject to adjustment for inflation in accordance with the requirements of 41 U.S.C. 1908, and is adjusted pursuant to such provisions, as appropriate.</P>
                            <P>(d) A matrix showing the most recent escalation adjustments of statutory acquisition-related dollar thresholds is available at PGI 201.109.</P>
                            <CITA>[71 FR 75892, Dec. 19, 2006, as amended at 77 FR 19128, Mar. 30, 2012; 84 FR 25187, May 31, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>201.170</SECTNO>
                            <SUBJECT>Peer reviews.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Defense Pricing, Contracting, and Acquisition Policy peer reviews.</E>
                                 (1) The Office of the Principal Director, Defense Pricing, Contracting, and Acquisition Policy (DPCAP), using the procedures at PGI 201.170, will organize teams of reviewers and facilitate peer reviews for solicitations and contracts as follows:
                            </P>
                            <P>(i) DPCAP will conduct the preaward peer reviews for competitive procurements prior to the three phases of the acquisition (see PGI 201.170-2(a)) for all procurements with an estimated value of $1 billion or more under major defense acquisition programs for which the Under Secretary of Defense for Acquisition and Sustainment (USD(A&amp;S)) is the milestone decision authority or USD(A&amp;S) designates as requiring a peer review regardless of value. DoD components may request DPCAP-led peer reviews for acquisitions valued below the $1 billion threshold. DPCAP will conduct these reviews upon approval by the Director, DPCAP (Contract Policy).</P>
                            <P>
                                (ii) DPCAP will conduct the preaward peer reviews for noncompetitive procurements prior to the two phases of the acquisition (see PGI 201.170-2(b)) for contract actions, 
                                <E T="03">e.g.,</E>
                                 new contracts, modifications to existing contracts, requests for equitable adjustment, claims valued at $1 billion or more, or for any other contract action USD(A&amp;S) designates as requiring a peer review regardless of value. DoD components may request DPCAP-led peer reviews for contract actions valued below the $1 billion threshold. DPCAP will conduct these reviews upon approval by the Director, DPCAP (Price, Cost and Finance).
                            </P>
                            <P>(iii) Use the following criteria to identify actions that are subject to peer review (see also FAR 1.108(c), Dollar thresholds):</P>
                            <P>
                                (A) If the not-to-exceed amount for an undefinitized contract action or an unpriced change order exceeds the peer review threshold, then the resultant 
                                <PRTPAGE P="9"/>
                                definitization modification(s) will be subject to peer review regardless of actual performance up to the point of definitization.
                            </P>
                            <P>(B) For indefinite delivery indefinite quantity (IDIQ) contracts that will establish pricing terms that apply to orders, use the total maximum dollar value for purposes of the peer review threshold. IDIQ contracts that will not establish pricing terms in the basic contract are not subject to peer review, but individual orders that exceed the threshold are subject to peer review.</P>
                            <P>(C) For noncompetitive contract actions, use the greater of the following when considering the firm requirement for all supplies or services:</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) The approved Government objective amount.
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) The contractor proposed amount.
                            </P>
                            <P>
                                (2) To facilitate planning for peer reviews, the military departments and defense agencies shall provide a rolling annual forecast of acquisitions that will be subject to DPCAP peer reviews at the end of each quarter (
                                <E T="03">i.e.,</E>
                                 March 31; June 30; September 30; December 31).
                            </P>
                            <P>
                                (i) Military departments and defense agencies shall submit quarterly forecasts for competitive peer reviews to the Director, DPCAP (Contract Policy), at 
                                <E T="03">osd.pentagon.ousd-a-s.mbx.dpc-cp@mail.mil.</E>
                            </P>
                            <P>
                                (ii) Military departments and defense agencies shall submit quarterly forecasts for noncompetitive peer reviews to the Director, DPCAP (Price, Cost and Finance), at 
                                <E T="03">osd.pentagon.ousd-a-s.mbx.dpc-pcf-peer-reviews@mail.mil</E>
                            </P>
                            <P>
                                (b) 
                                <E T="03">Component peer reviews.</E>
                                 The military departments and defense agencies shall establish procedures for—
                            </P>
                            <P>(1) Preaward peer reviews of solicitations for competitive procurements not subject to paragraph (a)(1)(i) of this section; and</P>
                            <P>(2) Preaward peer reviews of noncompetitive procurements not subject to paragraph (a)(1)(ii) of this section.</P>
                            <CITA>[86 FR 67877, Nov. 30, 2021, as amended at 89 FR 60830, July 29, 2024; 89 FR 79002, Sept. 26, 2024]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 201.2—Administration</HD>
                        <SECTION>
                            <SECTNO>201.201</SECTNO>
                            <SUBJECT>Maintenance of the FAR.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>201.201-1</SECTNO>
                            <SUBJECT>The two councils.</SUBJECT>
                            <P>(c) The composition and operation of the DAR Council is prescribed in DoD Instruction 5000.35, Defense Acquisition Regulations (DAR) System.</P>
                            <P>
                                (d)(i) Departments and agencies process proposed revisions of FAR or DFARS through channels to the Director of the DAR Council. Process the proposed revision as a memorandum in the following format, addressed to the Director, DAR Council via email at 
                                <E T="03">osd.pentagon.ousd-a-s.mbx.dfars@mail.mil.</E>
                            </P>
                            <EXTRACT>
                                <P>I. PROBLEM: Succinctly state the problem created by current FAR and/or DFARS coverage and describe the factual and/or legal reasons necessitating the change to the regulation.</P>
                                <P>II. RECOMMENDATION: Identify the FAR and/or DFARS citations to be revised. Attach as TAB A a copy of the text of the existing coverage, conformed to include the proposed additions and deletions. Indicate deleted coverage with dashed lines through the current words being deleted and insert proposed language in brackets at the appropriate locations within the existing coverage. If the proposed deleted portion is extensive, it may be outlined by lines forming a box with diagonal lines drawn connecting the corners.</P>
                                <P>III. DISCUSSION: Include a complete, convincing explanation of why the change is necessary and how the recommended revision will solve the problem. Address advantages and disadvantages of the proposed revision, as well as any cost or administrative impact on Government activities and contractors. Identify any potential impact of the change on automated systems, e.g., automated financial and procurement systems. Provide any other background information that would be helpful in explaining the issue.</P>
                                <P>IV. COLLATERALS: Address the need for public comment (FAR 1.301(b) and subpart 1.5), the Paperwork Reduction Act, and the Regulatory Flexibility Act (FAR 1.301(c)).</P>
                                <P>V. DEVIATIONS: If a recommended revision of DFARS is a FAR deviation, identify the deviation and include under separate TAB a justification for the deviation that addresses the requirements of 201.402(2). The justification should be in the form of a memorandum for the Principal Director, Defense Pricing, Contracting, and Acquisition Policy, Office of the Under Secretary of Defense (Acquisition and Sustainment).</P>
                            </EXTRACT>
                            <PRTPAGE P="10"/>
                            <P>(ii) The public may offer proposed revisions of FAR or DFARS by submission of a memorandum, in the format (including all of the information) prescribed in paragraph (d)(i) of this subsection, to the Director of the DAR Council.</P>
                            <CITA>[56 FR 36284, July 31, 1991, as amended at 60 FR 61591, Nov. 30, 1995; 61 FR 50451, Sept. 26, 1996; 63 FR 11528, Mar. 9, 1998; 65 FR 6552, Feb. 10, 2000; 68 FR 7439, Feb. 14, 2003; 73 FR 70906, Nov. 24, 2008; 77 FR 76937, Dec. 31, 2012; 78 FR 13543, Feb. 28, 2013; 88 FR 73234, Oct. 25, 2023; 89 FR 60830, July 29, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>201.201-70</SECTNO>
                            <SUBJECT>Maintenance of Procedures, Guidance, and Information.</SUBJECT>
                            <P>The DAR Council is also responsible for maintenance of the DFARS Procedures, Guidance, and Information (PGI).</P>
                            <CITA>[69 FR 63326, Nov. 1, 2004]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 201.3—Agency Acquisition Regulations</HD>
                        <SECTION>
                            <SECTNO>201.301</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(a)(1) DoD implementation and supplementation of the FAR is issued in the Defense Federal Acquisition Regulation Supplement (DFARS) under authorization and subject to the authority, direction, and control of the Secretary of Defense. The DFARS contains—</P>
                            <P>(i) Requirements of law;</P>
                            <P>(ii) DoD-wide policies;</P>
                            <P>(iii) Delegations of FAR authorities;</P>
                            <P>(iv) Deviations from FAR requirements; and</P>
                            <P>(v) Policies/procedures that have a significant effect beyond the internal operating procedures of DoD or a significant cost or administrative impact on contractors or offerors.</P>
                            <P>(2) Relevant procedures, guidance, and information that do not meet the criteria in paragraph (a)(1) of this section are issued in the DFARS Procedures, Guidance, and Information (PGI).</P>
                            <P>
                                (b) When 
                                <E T="04">Federal Register</E>
                                 publication is required for any policy, procedure, clause, or form, the department or agency requesting Under Secretary of Defense (Acquisition and Sustainment) (USD(A&amp;S)) approval for use of the policy, procedure, clause, or form (see 201.304(1)) must include an analysis of the public comments in the request for approval. Information on determining when a clause requires publication in the 
                                <E T="04">Federal Register</E>
                                 and approval in accordance with 201.304(1) is provided at PGI 201.301(b).
                            </P>
                            <CITA>[56 FR 36284, July 31, 1991, as amended at 60 FR 61591, Nov. 30, 1995; 65 FR 6552, Feb. 10, 2000; 69 FR 63326, Nov. 1, 2004; 80 FR 36718, June 26, 2015; 88 FR 73235, Oct. 25, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>201.303</SECTNO>
                            <SUBJECT>Publication and codification.</SUBJECT>
                            <P>(a)(i) The DFARS is codified under chapter 2 in title 48, Code of Federal Regulations.</P>
                            <P>(ii) To the extent possible, all DFARS text (whether implemental or supplemental) is numbered as if it were implemental. Supplemental numbering is used only when the text cannot be integrated intelligibly with its FAR counterpart.</P>
                            <P>
                                (A) Implemental numbering is the same as its FAR counterpart, except when the text exceeds one paragraph, the subdivisions are numbered by skipping a unit in the FAR 1.105-2(b)(2) prescribed numbering sequence. For example, three paragraphs implementing FAR 19.501 would be numbered 219.501 (1), (2), and (3) rather than (a), (b), and (c). Three paragraphs implementing FAR 19.501(a) would be numbered 219.501(a) (i), (ii), and (iii) rather than (a) (1), (2), and (3). Further subdivision of the paragraphs follows the prescribed numbering sequence, e.g., 219.501(1)(i)(A)(
                                <E T="03">1</E>
                                )(
                                <E T="03">i</E>
                                ).
                            </P>
                            <P>(B) Supplemental numbering is the same as its FAR counterpart, with the addition of a number of 70 and up or (S-70) and up. Parts, subparts, sections, or subsections are supplemented by the addition of a number of 70 and up. Lower divisions are supplemented by the addition of a number of (S-70) and up. When text exceeds one paragraph, the subdivisions are numbered using the FAR 1.105-2(b)(2) prescribed sequence, without skipping a unit. For example, DFARS text supplementing FAR 19.501 would be numbered 219.501-70. Its subdivisions would be numbered 219.501-70 (a), (b), and (c).</P>
                            <P>
                                (C) Subdivision numbering below the 4th level does not repeat the numbering sequence. It uses italicized Arabic numbers and then italicized lower case Roman numerals.
                                <PRTPAGE P="11"/>
                            </P>
                            <P>(D) An example of DFARS numbering is in Table 1-1, DFARS Numbering.</P>
                            <P>(iii) Department/agency and component supplements must parallel the FAR and DFARS numbering, except department/agency supplemental numbering uses subsection numbering of 90 and up, instead of 70 and up.</P>
                            <GPOTABLE COLS="3" OPTS="L2" CDEF="xl10,xl10,xl10">
                                <TTITLE>Table 1-1—DFARS Numbering</TTITLE>
                                <BOXHD>
                                    <CHED H="1">FAR</CHED>
                                    <CHED H="1">Is implemented as</CHED>
                                    <CHED H="1">Is supplemented as</CHED>
                                </BOXHD>
                                <ROW>
                                    <ENT I="01">19</ENT>
                                    <ENT>219</ENT>
                                    <ENT>219.70</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">19.5</ENT>
                                    <ENT>219.5</ENT>
                                    <ENT>219.570</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">19.501</ENT>
                                    <ENT>219.501</ENT>
                                    <ENT>219.501-70</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">19.501-1</ENT>
                                    <ENT>219.501-1</ENT>
                                    <ENT>219.501-1-70</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">19.501-1(a)</ENT>
                                    <ENT>219.501-1(a)</ENT>
                                    <ENT>219.501-1(a)(S-70)</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">19.501-1(a)(1)</ENT>
                                    <ENT>219.501-1(a)(1)</ENT>
                                    <ENT>219.501-1(a)(1)(S-70)</ENT>
                                </ROW>
                            </GPOTABLE>
                            <CITA>[56 FR 36284, July 31, 1991, as amended at 64 FR 51074, Sept. 21, 1999]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>201.304</SECTNO>
                            <SUBJECT>Agency control and compliance procedures.</SUBJECT>
                            <P>Departments and agencies and their component organizations may issue acquisition regulations as necessary to implement or supplement the FAR or DFARS.</P>
                            <P>(1)(i) Approval of the USD(A&amp;S) is required before including in a department/agency or component supplement, or any other contracting regulation document such as a policy letter or clause book, any policy, procedure, clause, or form that—</P>
                            <P>(A) Has a significant effect beyond the internal operating procedures of the agency; or</P>
                            <P>(B) Has a significant cost or administrative impact on contractors or offerors.</P>
                            <P>(ii) Except as provided in paragraph (2) of this section, the USD(A&amp;S) has delegated authority to the Principal Director, Defense Pricing, Contracting, and Acquisition Policy (DPCAP) to approve or disapprove the policies, procedures, clauses, and forms subject to paragraph (1)(i) of this section.</P>
                            <P>(2) In accordance with 41 U.S.C. 1304, a new requirement for a certification by a contractor or offeror may not be included in a department/agency or component procurement regulation unless—</P>
                            <P>(i) The certification requirement is specifically imposed by statute; or</P>
                            <P>(ii) Written justification for such certification is provided to the Secretary of Defense by USD(A&amp;S), and the Secretary of Defense approves in writing the inclusion of such certification requirement.</P>
                            <P>(3) Contracting activities must obtain the appropriate approval (see 201.404) for any class deviation (as defined in FAR subpart 1.4) from the FAR or DFARS, before its inclusion in a department/agency or component supplement or any other contracting regulation document such as a policy letter or clause book.</P>
                            <P>(4) Each department and agency must develop and, upon approval by USD(A&amp;S)DPCAP, implement, maintain, and comply with a plan for controlling the use of clauses other than those prescribed by FAR or DFARS. Additional information on department and agency clause control plan requirements is available at PGI 201.304(4).</P>
                            <P>(5) Departments and agencies must submit requests for the Secretary of Defense, USD(A&amp;S), and OUSD(A&amp;S)DPCAP approvals required by this section through the Director of the DAR Council. Procedures for requesting approval of department and agency clauses are provided at PGI 201.304(5).</P>
                            <P>
                                (6) The Principal Director, DPCAP publishes changes to the DFARS in the 
                                <E T="04">Federal Register</E>
                                 at 
                                <E T="03">https://www.federalregister.gov</E>
                                 and on the DPCAP website at 
                                <E T="03">https://www.acq.osd.mil/dpap/dars/change_notices.html.</E>
                                 Each change includes an effective date. Unless guidance accompanying a change states otherwise, contracting officers must include any new or revised clauses, provisions, or forms in solicitations issued on or after the effective date of the change.
                            </P>
                            <CITA>[56 FR 36284, July 31, 1991, as amended at 60 FR 61591, Nov. 30, 1995; 63 FR 11528, Mar. 9, 1998; 64 FR 39430, July 22, 1999; 65 FR 6552, Feb. 10, 2000; 68 FR 7439, Feb. 14, 2003; 76 FR 58137, Sept. 20, 2011; 77 FR 35879, June 15, 2012; 80 FR 36718, June 26, 2015; 88 FR 73235, Oct. 25, 2023; 89 FR 60830, July 29, 2024]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <PRTPAGE P="12"/>
                        <HD SOURCE="HED">Subpart 201.4—Deviations From the FAR</HD>
                        <SECTION>
                            <SECTNO>201.402</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(1) The Principal Director, Defense Pricing, Contracting, and Acquisition Policy, Office of the Under Secretary of Defense (Acquisition and Sustainment) (OUSD(A&amp;S)DPCAP), is the approval authority within DoD for any individual or class deviation from—</P>
                            <P>(i) FAR 3.104, Procurement Integrity, or DFARS 203.104, Procurement Integrity;</P>
                            <P>(ii) FAR subpart 27.4, Rights in Data and Copyrights, or DFARS subpart 227.4, Rights in Data and Copyrights;</P>
                            <P>(iii) FAR part 30, Cost Accounting Standards Administration, or DFARS part 230, Cost Accounting Standards Administration;</P>
                            <P>(iv) FAR subpart 31.1, Applicability, or DFARS subpart 231.1, Applicability (contract cost principles);</P>
                            <P>(v) FAR subpart 31.2, Contracts with Commercial Organizations, or DFARS subpart 231.2, Contracts with Commercial Organizations; or</P>
                            <P>(vi) FAR part 32, Contract Financing (except subparts 32.7 and 32.8 and the payment clauses prescribed by subpart 32.1), or DFARS part 232, Contract Financing (except subparts 232.7 and 232.8).</P>
                            <P>
                                (2) Submit requests for deviation approval through department/agency channels to the approval authority in paragraph (1) of this section, 201.403, or 201.404, as appropriate. Submit deviations that require OUSD(A&amp;S)DPCAP approval through the Director of the DAR Council via email at 
                                <E T="03">osd.pentagon.ousd-a-s.mbx.dfars@mail.mil.</E>
                                 At a minimum, each request must—
                            </P>
                            <P>(i) Identify the department/agency, and component if applicable, requesting the deviation;</P>
                            <P>(ii) Identify the FAR or DFARS citation from which a deviation is needed, state what is required by that citation, and indicate whether an individual or class deviation is requested;</P>
                            <P>(iii) Describe the deviation and indicate which of paragraphs (a) through (f) of FAR 1.401 best categorizes the deviation;</P>
                            <P>(iv) State whether the deviation will have a significant effect beyond the internal operating procedures of the agency and/or a significant cost or administrative impact on contractors or offerors, and give reasons to support the statement;</P>
                            <P>(v) State the period of time for which the deviation is required;</P>
                            <P>(vi) State whether approval for the same deviation has been received previously, and if so, when;</P>
                            <P>
                                (vii) State whether the proposed deviation was published (see FAR subpart 1.5 for publication requirements) in the 
                                <E T="04">Federal Register</E>
                                 and provide analysis of comments;
                            </P>
                            <P>(viii) State whether the request for deviation has been reviewed by legal counsel, and if so, state results; and</P>
                            <P>(ix) Give detailed rationale for the request. State what problem or situation will be avoided, corrected, or improved if request is approved.</P>
                            <CITA>[56 FR 36284, July 31, 1991, as amended at 60 FR 61591, Nov. 30, 1995; 61 FR 50451, Sept. 26, 1996; 64 FR 8727, Feb. 23, 1999; 65 FR 6552, Feb. 10, 2000; 68 FR 7439, Feb. 14, 2003; 88 FR 73235, Oct. 25, 2023; 89 FR 60830, July 29, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>201.403</SECTNO>
                            <SUBJECT>Individual deviations.</SUBJECT>
                            <P>(1) Individual deviations, except those described in 201.402(1) and paragraph (2) of this section, must be approved in accordance with the department/agency plan prescribed by 201.304(4).</P>
                            <P>(2) Contracting officers outside the United States may deviate from prescribed nonstatutory FAR and DFARS clauses when—</P>
                            <P>(i) Contracting for support services, supplies, or construction, with the governments of North Atlantic Treaty Organization (NATO) countries or other allies (as described in 10 U.S.C. 2341(2)), or with United Nations or NATO organizations; and</P>
                            <P>(ii) Such governments or organizations will not agree to the standard clauses.</P>
                            <CITA>[65 FR 6552, Feb. 10, 2000]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>201.404</SECTNO>
                            <SUBJECT>Class deviations.</SUBJECT>
                            <P>(b)(i) Except as provided in paragraph (b)(ii) of this section, OUSD(A&amp;S)DPCAP is the approval authority within DoD for any class deviation.</P>
                            <P>
                                (ii) The senior procurement executives for the Army, Navy, and Air 
                                <PRTPAGE P="13"/>
                                Force, and the Directors of the Defense Commissary Agency, the Defense Contract Management Agency, and the Defense Logistics Agency, may approve any class deviation, other than those described in 201.402(1), that does not—
                            </P>
                            <P>(A) Have a significant effect beyond the internal operating procedures of the department or agency;</P>
                            <P>(B) Have a significant cost or administrative impact on contractors or offerors;</P>
                            <P>(C) Diminish any preference given small business concerns by the FAR or DFARS; or</P>
                            <P>(D) Extend to requirements imposed by statute or by regulations of other agencies such as the Small Business Administration and the Department of Labor.</P>
                            <CITA>[65 FR 6552, Feb. 10, 2000, as amended at 65 FR 52951, Aug. 31, 2000; 68 FR 7439, Feb. 14, 2003; 88 FR 73235, Oct. 25, 2023; 89 FR 60831, July 29, 2024]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 201.6—Career Development, Contracting Authority, and Responsibilities</HD>
                        <SECTION>
                            <SECTNO>201.602</SECTNO>
                            <SUBJECT>Contracting officers.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>201.602-2</SECTNO>
                            <SUBJECT>Responsibilities.</SUBJECT>
                            <P>(d) Follow the procedures at PGI 201.602-2 regarding designation, assignment, and responsibilities of a contracting officer's representative (COR).</P>
                            <P>(1) A COR shall be an employee, military or civilian, of the U.S. Government, a foreign government, or a North Atlantic Treaty Organization/coalition partner. In no case shall contractor personnel serve as CORs.</P>
                            <CITA>[79 FR 22036, Apr. 21, 2014]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>201.602-70</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at 252.201-7000, Contracting Officer's Representative, in solicitations and contracts when appointment of a contracting officer's representative is anticipated.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>201.603</SECTNO>
                            <SUBJECT>Selection, appointment, and termination of appointment for contracting officers.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>201.603-2</SECTNO>
                            <SUBJECT>Selection.</SUBJECT>
                            <P>(1) In accordance with 10 U.S.C. 1724, in order to qualify to serve as a contracting officer with authority to award or administer contracts for amounts above the simplified acquisition threshold, a person must—</P>
                            <P>(i) Have completed all contracting courses required for a contracting officer to serve in the grade in which the employee or member of the armed forces will serve;</P>
                            <P>(ii) Have at least 2 years experience in a contracting position;</P>
                            <P>(iii) Have received a baccalaureate degree from an accredited educational institution; and</P>
                            <P>(iv) Meet such additional requirements, based on the dollar value and complexity of the contracts awarded or administered in the position, as may be established by the Secretary of Defense.</P>
                            <P>(2) The qualification requirements in paragraph (1)(iii) of this subsection do not apply to a DoD employee or member of the armed forces who—</P>
                            <P>(i) On or before September 30, 2000, occupied—</P>
                            <P>(A) A contracting officer position with authority to award or administer contracts above the simplified acquisition threshold; or</P>
                            <P>(B) A position either as an employee in the GS-1102 occupational series or a member of the armed forces in an occupational specialty similar to the GS-1102 series;</P>
                            <P>(ii) Is in a contingency contracting force; or</P>
                            <P>(iii) Is an individual appointed to a 3-year developmental position. Information on developmental opportunities is contained in DoD Instruction 5000.66, Defense Acquisition Workforce Education, Training, Experience, and Career Development Program.</P>
                            <P>(3) Waivers to the requirements in paragraph (1) of this subsection may be authorized. Information on waivers is contained in DoD Instruction 5000.66.</P>
                            <CITA>[67 FR 65509, Oct. 25, 2002, as amended at 73 FR 21844, Apr. 23, 2008; 85 FR 34528, June 5, 2020]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>201.603-3</SECTNO>
                            <SUBJECT>Appointment.</SUBJECT>
                            <P>
                                (a) Certificates of Appointment executed under the Armed Services Procurement Regulation or the Defense Acquisition Regulation have the same effect as if they had been issued under FAR.
                                <PRTPAGE P="14"/>
                            </P>
                            <P>(b) Agency heads may delegate the purchase authority in 213.301 to DoD civilian employees and members of the U.S. Armed Forces.</P>
                            <CITA>[56 FR 36284, July 31, 1991, as amended at 64 FR 56705, Oct. 21, 1999]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>201.670</SECTNO>
                            <SUBJECT>Appointment of property administrators and plant clearance officers.</SUBJECT>
                            <P>(a) The appropriate agency authority shall appoint or terminate (in writing) property administrators and plant clearance officers.</P>
                            <P>(b) In appointing qualified property administrators and plant clearance officers, the appointing authority shall consider experience, training, education, business acumen, judgment, character, and ethics.</P>
                            <CITA>[76 FR 52142, Aug. 19, 2011]</CITA>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 202</EAR>
                    <HD SOURCE="HED">PART 202—DEFINITIONS OF WORDS AND TERMS</HD>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 202.1—Definitions</HD>
                        <SECTION>
                            <SECTNO>202.101</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>
                                <E T="03">Authorized aftermarket manufacturer</E>
                                 means an organization that fabricates an electronic part under a contract with, or with the express written authority of, the original component manufacturer based on the original component manufacturer's designs, formulas, and/or specifications.
                            </P>
                            <P>
                                <E T="03">Compromise</E>
                                 means disclosure of information to unauthorized persons, or a violation of the security policy of a system, in which unauthorized intentional or unintentional disclosure, modification, destruction, or loss of an object, or the copying of information to unauthorized media may have occurred.
                            </P>
                            <P>
                                <E T="03">Congressional defense committees</E>
                                 means—
                            </P>
                            <P>(1) In accordance with 10 U.S.C. 101(a)(16), except as otherwise specified in paragraph (2) of this definition or as otherwise specified by statute for particular applications—</P>
                            <P>(i) The Committee on Armed Services of the Senate;</P>
                            <P>(ii) The Committee on Appropriations of the Senate;</P>
                            <P>(iii) The Committee on Armed Services of the House of Representatives; and</P>
                            <P>(iv) The Committee on Appropriations of the House of Representatives.</P>
                            <P>(2) For use in subpart 217.1, see the definition at 217.103.</P>
                            <P>
                                <E T="03">Contract administration office</E>
                                 also means a contract management office of the Defense Contract Management Agency.
                            </P>
                            <P>
                                <E T="03">Contract manufacturer</E>
                                 means a company that produces goods under contract for another company under the label or brand name of that company.
                            </P>
                            <P>
                                <E T="03">Contracting activity</E>
                                 for DoD also means elements designated by the director of a defense agency which has been delegated contracting authority through its agency charter. DoD contracting activities are listed at PGI 202.101.
                            </P>
                            <P>
                                <E T="03">Contracting officer's representative</E>
                                 means an individual designated and authorized in writing by the contracting officer to perform specific technical or administrative functions.
                            </P>
                            <P>
                                <E T="03">Contractor-approved supplier</E>
                                 means a supplier that does not have a contractual agreement with the original component manufacturer for a transaction, but has been identified as trustworthy by a contractor or subcontractor.
                            </P>
                            <P>
                                <E T="03">Counterfeit electronic part</E>
                                 means an unlawful or unauthorized reproduction, substitution, or alteration that has been knowingly mismarked, misidentified, or otherwise misrepresented to be an authentic, unmodified electronic part from the original manufacturer, or a source with the express written authority of the original manufacturer or current design activity, including an authorized aftermarket manufacturer. Unlawful or unauthorized substitution includes used electronic parts represented as new, or the false identification of grade, serial number, lot number, date code, or performance characteristics.
                            </P>
                            <P>
                                <E T="03">Cyber incident</E>
                                 means actions taken through the use of computer networks that result in a compromise or an actual or potentially adverse effect on an information system and/or the information residing therein.
                                <PRTPAGE P="15"/>
                            </P>
                            <P>
                                <E T="03">Department of Defense (DoD),</E>
                                 as used in DFARS, means the Department of Defense, the military departments, and the defense agencies.
                            </P>
                            <P>
                                <E T="03">Departments and agencies,</E>
                                 as used in DFARS, means the military departments and the defense agencies. The military departments are the Departments of the Army, Navy, and Air Force (the Marine Corps is a part of the Department of the Navy, and the Space Force is a part of the Air Force). The defense agencies are the Defense Advanced Research Projects Agency, the Defense Commissary Agency, the Defense Contract Management Agency, the Defense Counterintelligence and Security Agency, the Defense Finance and Accounting Service, the Defense Health Agency, the Defense Information Systems Agency, the Defense Intelligence Agency, the Defense Logistics Agency, the Defense Threat Reduction Agency, the Missile Defense Agency, the National Geospatial-Intelligence Agency, the National Security Agency, the United States Cyber Command, the United States Special Operations Command, the United States Transportation Command, and the Washington Headquarters Service.
                            </P>
                            <P>
                                <E T="03">Electronic part</E>
                                 means an integrated circuit, a discrete electronic component (including, but not limited to, a transistor, capacitor, resistor, or diode), or a circuit assembly (section 818(f)(2) of Pub. L. 112-81).
                            </P>
                            <P>
                                <E T="03">Executive agency</E>
                                 means for DoD, the Department of Defense, the Department of the Army, the Department of the Navy, and the Department of the Air Force.
                            </P>
                            <P>
                                <E T="03">Head of the agency</E>
                                 means, for DoD, the Secretary of Defense, the Secretary of the Army, the Secretary of the Navy, and the Secretary of the Air Force. Subject to the direction of the Secretary of Defense, the Under Secretary of Defense (Acquisition and Sustainment), and the Principal Director, Defense Pricing, Contracting, and Acquisition Policy, the directors of the defense agencies have been delegated authority to act as head of the agency for their respective agencies (i.e., to perform functions under the FAR or DFARS reserved to a head of agency or agency head), except for such actions that by terms of statute, or any delegation, must be exercised within the Office of the Secretary of Defense. (For emergency acquisition flexibilities, 
                                <E T="03">see</E>
                                 218.270.)
                            </P>
                            <P>
                                <E T="03">Major defense acquisition program</E>
                                 is defined in 10 U.S.C. 4201.
                            </P>
                            <P>
                                <E T="03">Milestone decision authority,</E>
                                 with respect to a major defense acquisition program or major system, means the official within the Department of Defense designated with the overall responsibility and authority for acquisition decisions for the program or system, including authority to approve entry of the program or system into the next phase of the acquisition process (10 U.S.C. 4211).
                            </P>
                            <P>
                                <E T="03">Non-Government sales</E>
                                 means sales of the supplies or services to non-Governmental entities for purposes other than governmental purposes.
                            </P>
                            <P>
                                <E T="03">Nontraditional defense contractor</E>
                                 means an entity that is not currently performing and has not performed any contract or subcontract for DoD that is subject to full coverage under the cost accounting standards prescribed pursuant to 41 U.S.C. 1502 and the regulations implementing such section, for at least the 1-year period preceding the solicitation of sources by DoD for the procurement (10 U.S.C. 3014).
                            </P>
                            <P>
                                <E T="03">Obsolete electronic part</E>
                                 means an electronic part that is no longer available from the original manufacturer or an authorized aftermarket manufacturer.
                            </P>
                            <P>
                                <E T="03">Offset</E>
                                 means a benefit or obligation agreed to by a contractor and a foreign government or international organization as an inducement or condition to purchase supplies or services pursuant to a foreign military sale (FMS). There are two types of offsets: Direct offsets and indirect offsets.
                            </P>
                            <P>
                                (1) A direct offset involves benefits or obligations, including supplies or services that are directly related to the item(s) being purchased and are integral to the deliverable of the FMS contract. For example, as a condition of a foreign military sale, the contractor may require or agree to permit the customer to produce in its country certain components or subsystems of the item being sold. Generally, direct offsets must be performed within a specified period, because they are integral to the deliverable of the FMS contract.
                                <PRTPAGE P="16"/>
                            </P>
                            <P>
                                (2) An indirect offset involves benefits or obligations, including supplies or services that are not directly related to the specific item(s) being purchased and are not integral to the deliverable of the FMS contract. For example, as a condition of a foreign military sale, the contractor may agree to purchase certain manufactured products, agricultural commodities, raw materials, or services, or make an equity investment or grant of equipment required by the FMS customer, or may agree to build a school, road or other facility. Indirect offsets would also include projects that are related to the FMS contract but not purchased under said contract (
                                <E T="03">e.g.,</E>
                                 a project to develop or advance a capability, technology transfer, or know-how in a foreign company). Indirect offsets may be accomplished without a clearly defined period of performance.
                            </P>
                            <P>
                                <E T="03">Offset costs</E>
                                 means the costs to the contractor of providing any direct or indirect offsets required (explicitly or implicitly) as a condition of a foreign military sale.
                            </P>
                            <P>
                                <E T="03">Original component manufacturer</E>
                                 means an organization that designs and/or engineers a part and is entitled to any intellectual property rights to that part.
                            </P>
                            <P>
                                <E T="03">Original equipment manufacturer</E>
                                 means a company that manufactures products that it has designed from purchased components and sells those products under the company's brand name.
                            </P>
                            <P>
                                <E T="03">Original manufacturer</E>
                                 means the original component manufacturer, the original equipment manufacturer, or the contract manufacturer.
                            </P>
                            <P>
                                <E T="03">Procedures, Guidance, and Information (PGI)</E>
                                 means a companion resource to the DFARS that—
                            </P>
                            <P>(1) Contains mandatory internal DoD procedures. The DFARS will direct compliance with mandatory procedures using imperative language such as “Follow the procedures at * * *” or similar directive language;</P>
                            <P>(2) Contains non-mandatory internal DoD procedures and guidance and supplemental information to be used at the discretion of the contracting officer. The DFARS will point to non-mandatory procedures, guidance, and information using permissive language such as “The contracting officer may use * * *” or “Additional information is available at * * *” or other similar language;</P>
                            <P>(3) Is numbered similarly to the DFARS, except that each PGI numerical designation is preceded by the letters “PGI”; and</P>
                            <P>
                                (4) Is availableat 
                                <E T="03">https://www.acq.osd.mil/dpap/dars/dfarspgi/current/index.html.</E>
                            </P>
                            <P>
                                <E T="03">Senior procurement executive</E>
                                 means, for DoD—
                            </P>
                            <P>(1) Department of Defense (including the defense agencies)—Under Secretary of Defense (Acquisition and Sustainment);</P>
                            <P>(2) Department of the Army—Assistant Secretary of the Army (Acquisition, Logistics and Technology);</P>
                            <P>(3) Department of the Navy—Assistant Secretary of the Navy (Research, Development and Acquisition);</P>
                            <P>(4) Department of the Air Force—Assistant Secretary of the Air Force (Acquisition); and</P>
                            <P>(5) The directors of the defense agencies have been delegated authority to act as senior procurement executive for their respective agencies, except for such actions that by terms of statute, or any delegation, must be exercised by the Under Secretary of Defense (Acquisition and Sustainment).</P>
                            <P>
                                <E T="03">Sufficient non-Government sales</E>
                                 means relevant sales data that reflects market pricing and contains enough information to make adjustments covered by FAR 15.404-1(b)(2)(ii)(B).
                            </P>
                            <P>
                                <E T="03">Suspect counterfeit electronic part</E>
                                 means an electronic part for which credible evidence (including, but not limited to, visual inspection or testing) provides reasonable doubt that the electronic part is authentic.
                            </P>
                            <P>
                                <E T="03">Tiered evaluation of offers</E>
                                , also known as 
                                <E T="03">cascading evaluation of offers</E>
                                , means a procedure used in negotiated acquisitions, when market research is inconclusive for justifying limiting competition to small business concerns, whereby the contracting officer—
                            </P>
                            <P>(1) Solicits and receives offers from both small and other than small business concerns;</P>
                            <P>
                                (2) Establishes a tiered or cascading order of precedence for evaluating offers that is specified in the solicitation; and
                                <PRTPAGE P="17"/>
                            </P>
                            <P>(3) If no award can be made at the first tier, evaluates offers at the next lower tier, until award can be made.</P>
                            <P>
                                <E T="03">Uncertified cost data</E>
                                 means the subset of “data other than certified cost or pricing data” (see FAR 2.101) that relates to cost.
                            </P>
                            <CITA>[56 FR 36287, July 31, 1991]</CITA>
                            <EDNOTE>
                                <HD SOURCE="HED">Editorial Note:</HD>
                                <P>
                                    For 
                                    <E T="04">Federal Register</E>
                                     citations affecting section 202.101, see the List of CFR Sections Affected, which appears in the Finding Aids section of the printed volume and at 
                                    <E T="03">www.govinfo.gov.</E>
                                </P>
                            </EDNOTE>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 203</EAR>
                    <HD SOURCE="HED">PART 203—IMPROPER BUSINESS PRACTICES AND PERSONAL CONFLICTS OF INTEREST</HD>
                    <CONTENTS>
                        <SECHD>Sec.</SECHD>
                        <SECTNO>203.070</SECTNO>
                        <SUBJECT>Reporting of violations and suspected violations.</SUBJECT>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 203.1—Safeguards</HD>
                            <SECTNO>203.104</SECTNO>
                            <SUBJECT>Procurement integrity.</SUBJECT>
                            <SECTNO>203.104-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>203.104-4</SECTNO>
                            <SUBJECT>Disclosure, protection, and marking of contractor bid or proposal information and source selection information.</SUBJECT>
                            <SECTNO>203.170</SECTNO>
                            <SUBJECT>Business practices.</SUBJECT>
                            <SECTNO>203.171</SECTNO>
                            <SUBJECT>Senior DoD officials seeking employment with defense contractors.</SUBJECT>
                            <SECTNO>203.171-1</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>203.171-2</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <SECTNO>203.171-3</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>203.171-4</SECTNO>
                            <SUBJECT>Solicitation provision and contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 203.5—Other Improper Business Practices</HD>
                            <SECTNO>203.502-2</SECTNO>
                            <SUBJECT>Subcontractor kickbacks.</SUBJECT>
                            <SECTNO>203.570</SECTNO>
                            <SUBJECT>Prohibition on persons convicted of fraud or other defense-contract-related felonies.</SUBJECT>
                            <SECTNO>203.570-1</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>203.570-2</SECTNO>
                            <SUBJECT>Prohibition period.</SUBJECT>
                            <SECTNO>203.570-3</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 203.7—Voiding and Rescinding Contracts</HD>
                            <SECTNO>203.703</SECTNO>
                            <SUBJECT>Authority.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 203.8—Limitations on the Payment of Funds To Influence Federal Transactions</HD>
                            <SECTNO>203.806</SECTNO>
                            <SUBJECT>Processing suspected violations.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 203.9—Whistleblower Protections for Contractor Employees</HD>
                            <SECTNO>203.900</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>203.901</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>203.903</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>203.904</SECTNO>
                            <SUBJECT>Procedures for filing complaints.</SUBJECT>
                            <SECTNO>203.905</SECTNO>
                            <SUBJECT>Procedures for investigating complaints.</SUBJECT>
                            <SECTNO>203.906</SECTNO>
                            <SUBJECT>Remedies.</SUBJECT>
                            <SECTNO>203.909</SECTNO>
                            <SUBJECT>Prohibition on providing funds to an entity that requires certain internal confidentiality agreements or statements.</SUBJECT>
                            <SECTNO>203.909-3</SECTNO>
                            <SUBJECT>Solicitation provision and contract clause.</SUBJECT>
                            <SECTNO>203.970</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 203.10—Contractor Code of Business Ethics and Conduct</HD>
                            <SECTNO>203.1003</SECTNO>
                            <SUBJECT>Requirements.</SUBJECT>
                            <SECTNO>203.1004</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36288, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SECTION>
                        <SECTNO>203.070</SECTNO>
                        <SUBJECT>Reporting of violations and suspected violations.</SUBJECT>
                        <P>Report violations and suspected violations of the following requirements in accordance with 209.406-3 or 209.407-3 and DoDD 7050.5, Coordination of Remedies for Fraud and Corruption Related to Procurement Activities:</P>
                        <P>(a) Certificate of Independent Price Determination (FAR 3.103).</P>
                        <P>(b) Procurement integrity (FAR 3.104).</P>
                        <P>(c) Gratuities clause (FAR 3.203).</P>
                        <P>(d) Antitrust laws (FAR 3.303).</P>
                        <P>(e) Covenant Against Contingent Fees (FAR 3.405).</P>
                        <P>(f) Kickbacks (FAR 3.502).</P>
                        <P>(g) Prohibitions on persons convicted of defense-related contract felonies (203.570).</P>
                        <CITA>[69 FR 74990, Dec. 15, 2004, as amended at 77 FR 35879, June 15, 2012]</CITA>
                    </SECTION>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 203.1—Safeguards</HD>
                        <SECTION>
                            <SECTNO>203.104</SECTNO>
                            <SUBJECT>Procurement integrity.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>203.104-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this section—</P>
                            <P>
                                <E T="03">Federal agency procurement,</E>
                                 defined at FAR 3.104-1, also includes commercial solutions openings.
                            </P>
                            <CITA>[88 FR 55938, Aug. 17, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="18"/>
                            <SECTNO>203.104-4</SECTNO>
                            <SUBJECT>Disclosure, protection, and marking of contractor bid or proposal information and source selection information.</SUBJECT>
                            <P>(d)(3) For purposes of FAR 3.104-4(d)(3) only, DoD follows the notification procedures in FAR 27.404-5(a). However, FAR 27.404-5(a)(1) does not apply to DoD.</P>
                            <CITA>[74 FR 2409, Jan. 15, 2009]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>203.170</SECTNO>
                            <SUBJECT>Business practices.</SUBJECT>
                            <P>To ensure the separation of functions for oversight, source selection, contract negotiation, and contract award, departments and agencies shall adhere to the following best practice policies:</P>
                            <P>(a) Senior leaders shall not perform multiple roles in source selection for a major weapon system or major service acquisition.</P>
                            <P>(b) Vacant acquisition positions shall be filled on an “acting” basis from below until a permanent appointment is made. To provide promising professionals an opportunity to gain experience by temporarily filling higher positions, these oversight duties shall not be accrued at the top.</P>
                            <P>(c) Acquisition process reviews of the military departments shall be conducted to assess and improve acquisition and management processes, roles, and structures. The scope of the reviews should include—</P>
                            <P>(1) Distribution of acquisition roles and responsibilities among personnel;</P>
                            <P>(2) Processes for reporting concerns about unusual or inappropriate actions; and</P>
                            <P>(3) Application of DoD Instruction 5000.2, Operation of the Defense Acquisition System, and the disciplines in the Defense Acquisition Guidebook.</P>
                            <P>(d) Source selection processes shall be—</P>
                            <P>(1) Reviewed and approved by cognizant organizations responsible for oversight;</P>
                            <P>(2) Documented by the head of the contracting activity or at the agency level; and</P>
                            <P>(3) Periodically reviewed by outside officials independent of that office or agency.</P>
                            <P>(e) Legal review of documentation of major acquisition system source selection shall be conducted prior to contract award, including the supporting documentation of the source selection evaluation board, source selection advisory council, and source selection authority.</P>
                            <P>(f) Procurement management reviews shall determine whether clearance threshold authorities are clear and that independent review is provided for acquisitions exceeding the simplified acquisition threshold.</P>
                            <CITA>[72 FR 20757, Apr. 26, 2007, as amended at 74 FR 2408, Jan. 15, 2009; 79 FR 73488, Dec. 11, 2014]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>203.171</SECTNO>
                            <SUBJECT>Senior DoD officials seeking employment with defense contractors.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>203.171-1</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>This section implements section 847 of the National Defense Authorization Act for Fiscal Year 2008 (Pub. L. 110-181).</P>
                            <CITA>[74 FR 2409, Jan. 15, 2009, as amended at 87 FR 59028, Sept. 29, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>203.171-2</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <P>
                                <E T="03">Covered DoD official</E>
                                 as used in this section, is defined in the clause at 252.203-7000, Requirements Relating to Compensation of Former DoD Officials.
                            </P>
                            <CITA>[74 FR 2409, Jan. 15, 2009]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>203.171-3</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(a) A DoD official covered by the requirements of section 847 of Public Law 110-181 (a “covered DoD official”) who, within 2 years after leaving DoD service, expects to receive compensation from a DoD contractor, shall, prior to accepting such compensation, request a written opinion from the appropriate DoD ethics counselor regarding the applicability of post-employment restrictions to activities that the official may undertake on behalf of a contractor.</P>
                            <P>
                                (b) A DoD contractor may not knowingly provide compensation to a covered DoD official within 2 years after the official leaves DoD service unless the contractor first determines that the official has received, or has requested at least 30 days prior to receiving compensation from the contractor, the post-employment ethics opinion described in paragraph (a) of this section.
                                <PRTPAGE P="19"/>
                            </P>
                            <P>(c) If a DoD contractor knowingly fails to comply with the requirements of the clause at 252.203-7000, administrative and contractual actions may be taken, including cancellation of a procurement, rescission of a contract, or initiation of suspension or debarment proceedings.</P>
                            <CITA>[74 FR 2409, Jan. 15, 2009, as amended at 87 FR 59028, Sept. 29, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>203.171-4</SECTNO>
                            <SUBJECT>Solicitation provision and contract clause.</SUBJECT>
                            <P>(a) Use the clause at 252.203-7000, Requirements Relating to Compensation of Former DoD Officials, in all solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services.</P>
                            <P>(b) Use the provision at 252.203-7005, Representation Relating to Compensation of Former DoD Officials, in all solicitations, including solicitations using FAR part 12 procedures for the acquisition of commercial products and commercial services and solicitations for task orders and delivery orders.</P>
                            <CITA>[76 FR 71829, Nov. 18, 2011, as amended at 78 FR 37983, June 25, 2013; 88 FR 6580, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 203.5—Other Improper Business Practices</HD>
                        <SECTION>
                            <SECTNO>203.502-2</SECTNO>
                            <SUBJECT>Subcontractor kickbacks.</SUBJECT>
                            <P>(h) The DoD Inspector General has designated Special Agents of the following investigative organizations as representatives for conducting inspections and audits under 41 U.S.C. chapter 87, Kickbacks:</P>
                            <P>(i) U.S. Army Criminal Investigation Command.</P>
                            <P>(ii) Naval Criminal Investigative Service.</P>
                            <P>(iii) Air Force Office of Special Investigations.</P>
                            <P>(iv) Defense Criminal Investigative Service.</P>
                            <CITA>[56 FR 36288, July 31, 1991, as amended at 60 FR 29497, June 5, 1995; 77 FR 35879, June 15, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>203.570</SECTNO>
                            <SUBJECT>Prohibition on persons convicted of fraud or other defense-contract-related felonies.</SUBJECT>
                            <CITA>[88 FR 6580, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>203.570-1</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>This subpart implements 10 U.S.C. 4656. For information on 10 U.S.C. 4656, see PGI 203.570-1.</P>
                            <CITA>[87 FR 76989, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>203.570-2</SECTNO>
                            <SUBJECT>Prohibition period.</SUBJECT>
                            <P>DoD has sole responsibility for determining the period of the prohibition described in paragraph (b) of the clause at 252.203-7001, Prohibition on Persons Convicted of Fraud or Other Defense-Contract-Related Felonies. The prohibition period—</P>
                            <P>(a) Shall not be less than 5 years from the date of conviction unless the agency head or a designee grants a waiver in the interest of national security. Follow the waiver procedures at PGI 203.570-2(a); and</P>
                            <P>(b) May be more than 5 years from the date of conviction if the agency head or a designee makes a written determination of the need for the longer period. The agency shall provide a copy of the determination to the address at PGI 203.570-2(b).</P>
                            <CITA>[69 FR 74990, Dec. 15, 2004]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>203.570-3</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at 252.203-7001, Prohibition on Persons Convicted of Fraud or Other Defense-Contract-Related Felonies, in all solicitations and contracts exceeding the simplified acquisition threshold, except solicitations and contracts for commercial products or commercial services.</P>
                            <CITA>[64 FR 14398, Mar. 25, 1999. Redesignated at 69 FR 74990, Dec. 15, 2004; 88 FR 6580, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 203.7—Voiding and Rescinding Contracts</HD>
                        <SECTION>
                            <SECTNO>203.703</SECTNO>
                            <SUBJECT>Authority.</SUBJECT>
                            <P>
                                The authority to act for the agency head under this subpart is limited to a level no lower than an official who is appointed by and with the advice of the Senate, without power of redelegation. For the defense agencies, for purposes 
                                <PRTPAGE P="20"/>
                                of this subpart, the agency head designee is the Under Secretary of Defense (Acquisition and Sustainment).
                            </P>
                            <CITA>[56 FR 36288, July 31, 1991, as amended at 60 FR 61592, Nov. 30, 1995; 65 FR 39704, June 27, 2000; 88 FR 73235, Oct. 25, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 203.8—Limitations on the Payment of Funds To Influence Federal Transactions</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>77 FR 19128, Mar. 30, 2012, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>203.806</SECTNO>
                            <SUBJECT>Processing suspected violations.</SUBJECT>
                            <P>Report suspected violations to the address at PGI 203.806(a).</P>
                            <CITA>[77 FR 19128, Mar. 30, 2012, as amended at 86 FR 59870, Oct. 29, 2021]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 203.9—Whistleblower Protections for Contractor Employees</HD>
                        <SECTION>
                            <SECTNO>203.900</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>This subpart implements 10 U.S.C. 4701 and section 883 of the National Defense Authorization Act for Fiscal Year 2021 (Pub. L. 116-283).</P>
                            <P>(a)(i) 10 U.S.C. 4701 provides DoD whistleblower protection policies and procedures for contractor employees. Use sections 203.901 through 203.906 of this subpart in lieu of FAR sections 3.901 through 3.906 to implement 10 U.S.C. 4701.</P>
                            <P>(ii) 10 U.S.C. 4701 does not apply to any element of the intelligence community, as defined in 50 U.S.C. 3003(4). Sections 203.901 through 203.906 do not apply to any disclosure made by an employee of a contractor or subcontractor of an element of the intelligence community if such disclosure—</P>
                            <P>(A) Relates to an activity or an element of the intelligence community; or</P>
                            <P>(B) Was discovered during contract or subcontract services provided to an element of the intelligence community.</P>
                            <P>(c) Section 883 of the National Defense Authorization Act for Fiscal Year 2021 (Pub. L. 116-283) prohibits the award of a DoD contract to contractors that require their employees to sign internal confidentiality agreements or statements that would prohibit or otherwise restrict such employees from lawfully reporting waste, fraud, or abuse related to the performance of a DoD contract to a designated investigative or law enforcement representative within DoD authorized to receive such information.</P>
                            <CITA>[87 FR 65511, Oct. 28, 2022, as amended at 87 FR 76990, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>203.901</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>
                                <E T="03">Abuse of authority,</E>
                                 as used in this subpart, means an arbitrary and capricious exercise of authority that is inconsistent with the mission of DoD or the successful performance of a DoD contract.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>203.903</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>
                                (1) 
                                <E T="03">Prohibition.</E>
                                 10 U.S.C. 4701 prohibits contractors and subcontractors from discharging, demoting, or otherwise discriminating against an employee as a reprisal for disclosing, to any of the entities listed at paragraph (3) of this section, information that the employee reasonably believes is evidence of gross mismanagement of a DoD contract, a gross waste of DoD funds, an abuse of authority relating to a DoD contract, a violation of law, rule, or regulation related to a DoD contract (including the competition for or negotiation of a contract), or a substantial and specific danger to public health or safety. Such reprisal is prohibited even if it is undertaken at the request of an executive branch official, unless the request takes the form of a non-discretionary directive and is within the authority of the executive branch official making the request.
                            </P>
                            <P>
                                (2) 
                                <E T="03">Classified information.</E>
                                 As provided in section 827(h) of the National Defense Authorization Act for Fiscal Year 2013, nothing in this subpart provides any rights to disclose classified information not otherwise provided by law.
                            </P>
                            <P>(3) Entities to whom disclosure may be made:</P>
                            <P>(i) A Member of Congress or a representative of a committee of Congress.</P>
                            <P>(ii) An Inspector General that receives funding from or has oversight over contracts awarded for or on behalf of DoD.</P>
                            <P>
                                (iii) The Government Accountability Office.
                                <PRTPAGE P="21"/>
                            </P>
                            <P>(iv) A DoD employee responsible for contract oversight or management.</P>
                            <P>(v) An authorized official of the Department of Justice or other law enforcement agency.</P>
                            <P>(vi) A court or grand jury.</P>
                            <P>(vii) A management official or other employee of the contractor or subcontractor who has the responsibility to investigate, discover, or address misconduct.</P>
                            <P>
                                (4) 
                                <E T="03">Disclosure clarified.</E>
                                 An employee who initiates or provides evidence of contractor or subcontractor misconduct in any judicial or administrative proceeding relating to waste, fraud, or abuse on a DoD contract shall be deemed to have made a disclosure.
                            </P>
                            <P>
                                (5) 
                                <E T="03">Contracting officer actions.</E>
                                 A contracting officer who receives a complaint of reprisal of the type described in paragraph (1) of this section shall forward it to legal counsel or to the appropriate party in accordance with agency procedures.
                            </P>
                            <CITA>[58 FR 59853, Sept. 30, 2013, as amended at 79 FR 11337, Feb. 28, 2014; 79 FR 23278, Apr. 28, 2014; 87 FR 76990, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>203.904</SECTNO>
                            <SUBJECT>Procedures for filing complaints.</SUBJECT>
                            <P>(1) Any employee of a contractor or subcontractor who believes that he or she has been discharged, demoted, or otherwise discriminated against contrary to the policy in 203.903 may file a complaint with the Inspector General of the Department of Defense.</P>
                            <P>(2) A complaint may not be brought under this section more than three years after the date on which the alleged reprisal took place.</P>
                            <P>(3) The complaint shall be signed and shall contain—</P>
                            <P>(i) The name of the contractor;</P>
                            <P>(ii) The contract number, if known; if not, a description reasonably sufficient to identify the contract(s) involved;</P>
                            <P>(iii) The violation of law, rule, or regulation giving rise to the disclosure;</P>
                            <P>(iv) The nature of the disclosure giving rise to the discriminatory act, including the party to whom the information was disclosed; and</P>
                            <P>(v) The specific nature and date of the reprisal.</P>
                            <CITA>[58 FR 59853, Sept. 30, 2013, as amended at 79 FR 11337, Feb. 28, 2014]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>203.905</SECTNO>
                            <SUBJECT>Procedures for investigating complaints.</SUBJECT>
                            <P>(1) Unless the DoD Inspector General makes a determination that the complaint is frivolous, fails to allege a violation of the prohibition in 203.903, or has been previously addressed in another Federal or State judicial or administrative proceeding initiated by the complainant, the DoD Inspector General will investigate the complaint.</P>
                            <P>(2) If the DoD Inspector General investigates the complaint, the DoD Inspector General will—</P>
                            <P>(i) Notify the complainant, the contractor alleged to have committed the violation, and the head of the agency; and</P>
                            <P>(ii) Provide a written report of findings to the complainant, the contractor alleged to have committed the violation, and the head of the agency.</P>
                            <P>(3) Upon completion of the investigation, the DoD Inspector General—</P>
                            <P>(i) Either will determine that the complaint is frivolous, fails to allege a violation of the prohibition in 203.903, or has been previously addressed in another Federal or State judicial or administrative proceeding initiated by the complainant, or will submit the report addressed in paragraph (2) of this section within 180 days after receiving the complaint; and</P>
                            <P>(ii) If unable to submit a report within 180 days, will submit the report within the additional time period, up to 180 days, as agreed to by the person submitting the complaint.</P>
                            <P>(4) The DoD Inspector General may not respond to any inquiry or disclose any information from or about any person alleging the reprisal, except to the extent that such response or disclosure is—</P>
                            <P>(i) Made with the consent of the person alleging reprisal;</P>
                            <P>(ii) Made in accordance with 5 U.S.C. 552a (the Freedom of Information Act) or as required by any other applicable Federal law; or</P>
                            <P>(iii) Necessary to conduct an investigation of the alleged reprisal.</P>
                            <P>
                                (5) The legal burden of proof specified at paragraph (e) of 5 U.S.C. 1221 (Individual Right of Action in Certain Reprisal Cases) shall be controlling for the purposes of an investigation conducted by the DoD Inspector General, 
                                <PRTPAGE P="22"/>
                                decision by the head of an agency, or judicial or administrative proceeding to determine whether prohibited discrimination has occurred.
                            </P>
                            <CITA>[74 FR 2410, Jan. 15, 2009, as amended at 78 FR 59853, Sept. 30, 2013; 79 FR 11337, Feb. 28, 2014]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>203.906</SECTNO>
                            <SUBJECT>Remedies.</SUBJECT>
                            <P>(1) Not later than 30 days after receiving a DoD Inspector General report in accordance with 203.905, the head of the agency shall determine whether sufficient basis exists to conclude that the contractor has subjected the complainant to a reprisal as prohibited by 203.903 and shall either issue an order denying relief or shall take one or more of the following actions:</P>
                            <P>(i) Order the contractor to take affirmative action to abate the reprisal.</P>
                            <P>(ii) Order the contractor to reinstate the person to the position that the person held before the reprisal, together with compensatory damages (including back pay), employment benefits, and other terms and conditions of employment that would apply to the person in that position if the reprisal had not been taken.</P>
                            <P>(iii) Order the contractor to pay the complainant an amount equal to the aggregate amount of all costs and expenses (including attorneys' fees and expert witnesses' fees) that were reasonably incurred by the complainant for, or in connection with, bringing the complaint regarding the reprisal, as determined by the head of the agency.</P>
                            <P>(2) If the head of the agency issues an order denying relief or has not issued an order within 210 days after the submission of the complaint or within 30 days after the expiration of an extension of time granted in accordance with 203.905(3)(ii), and there is no showing that such delay is due to the bad faith of the complainant—</P>
                            <P>(i) The complainant shall be deemed to have exhausted all administrative remedies with respect to the complaint; and</P>
                            <P>(ii) The complainant may bring a de novo action at law or equity against the contractor to seek compensatory damages and other relief available under 10 U.S.C. 4701 in the appropriate district court of the United States, which shall have jurisdiction over such an action without regard to the amount in controversy. Such an action shall, at the request of either party to the action, be tried by the court with a jury. An action under this authority may not be brought more than 2years after the date on which remedies are deemed to have been exhausted.</P>
                            <P>(3) An Inspector General determination and an agency head order denying relief under paragraph (2) of this section shall be admissible in evidence in any de novo action at law or equity brought pursuant to 10 U.S.C. 4701(c).</P>
                            <P>(4) Whenever a contractor fails to comply with an order issued by the head of agency in accordance with 10 U.S.C. 4701, the head of the agency or designee shall request the Department of Justice to file an action for enforcement of such order in the United States district court for a district in which the reprisal was found to have occurred. In any action brought under this paragraph, the court may grant appropriate relief, including injunctive relief, compensatory and exemplary damages, and reasonable attorney fees and costs. The person upon whose behalf an order was issued may also file such an action or join in an action filed by the head of the agency.</P>
                            <P>(5) Any person adversely affected or aggrieved by an order issued by the head of the agency in accordance with 10 U.S.C. 4701 may obtain judicial review of the order's conformance with the law, and the implementing regulation, in the United States Court of Appeals for a circuit in which the reprisal is alleged in the order to have occurred. No petition seeking such review may be filed more than 60 days after issuance of the order by the head of the agency or designee. Review shall conform to Chapter 7 of Title 5, Unites States Code. Filing such an appeal shall not act to stay the enforcement of the order by the head of an agency, unless a stay is specifically entered by the court.</P>
                            <P>(6) The rights and remedies provided for in this subpart may not be waived by any agreement, policy, form, or condition of employment.</P>
                            <CITA>[74 FR 2410, Jan. 15, 2009, as amended at 78 FR 59854, Sept. 30, 2013; 78 FR 73450, Dec. 6, 2013; 87 FR 76990, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="23"/>
                            <SECTNO>203.909</SECTNO>
                            <SUBJECT>Prohibition on providing funds to an entity that requires certain internal confidentiality agreements or statements.</SUBJECT>
                            <CITA>[87 FR 65512, Oct. 28, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>203.909-3</SECTNO>
                            <SUBJECT>Solicitation provision and contract clause.</SUBJECT>
                            <P>Use the provision at FAR 52.203-18, Prohibition on Contracting with Entities That Require Certain Internal Confidentiality Agreements or Statements—Representation, and the clause at FAR 52.203-19, Prohibition on Requiring Certain Internal Confidentiality Agreements or Statements, prescribed at FAR 3.909-3 to implement section 883 of the National Defense Authorization Act for Fiscal Year 2021.</P>
                            <CITA>[87 FR 65512, Oct. 28, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>203.970</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at 252.203-7002, Requirement to Inform Employees of Whistleblower Rights, in all solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products or commercial services.</P>
                            <CITA>[87 FR 65512, Oct. 28, 2022, as amended at 88 FR 6580, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 203.10—Contractor Code of Business Ethics and Conduct</HD>
                        <SECTION>
                            <SECTNO>203.1003</SECTNO>
                            <SUBJECT>Requirements.</SUBJECT>
                            <P>(b) Notification of possible contractor violation. Upon notification of a possible contractor violation of the type described in FAR 3.1003(b), coordinate the matter with the following office:</P>
                            <EXTRACT>
                                <FP SOURCE="FP-1">Department of Defense Office of Inspector General, Administrative Investigations Contractor Disclosure Program, 4800 Mark Center Drive, Suite 14L25, Arlington, VA 22350-1500.</FP>
                                <FP SOURCE="FP-1">
                                    Toll-Free Telephone: 866-429-8011. Website: 
                                    <E T="03">https://www.dodig.mil/Programs/Contractor-Disclosure-Program/.</E>
                                </FP>
                            </EXTRACT>
                            <P>
                                (c) 
                                <E T="03">Fraud hotline poster.</E>
                                 For contracts performed outside the United States, when security concerns can be appropriately demonstrated, the contracting officer may provide the contractor the option to publicize the program to contractor personnel in a manner other than public display of the poster required by 203.1004(b)(2)(ii), such as private employee written instructions and briefings.
                            </P>
                            <CITA>[77 FR 76937, Dec. 31, 2012, as amended at 81 FR 73005, Oct. 21, 2016; 84 FR 39202, Aug. 9, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>203.1004</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>(a) Use the clause at 252.203-7003, Agency Office of the Inspector General, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, that include the FAR clause 52.203-13, Contractor Code of Business Ethics and Conduct.</P>
                            <P>(b)(2)(ii) Unless the contract is for the acquisition of a commercial product or commercial service, use the clause at 252.203-7004, Display of Hotline Posters, in lieu of the clause at FAR 52.203-14, Display of Hotline Poster(s), in solicitations and contracts, if the contract value exceeds $6 million. If the Department of Homeland Security (DHS) provides disaster relief funds for the contract, DHS will provide information on how to obtain and display the DHS fraud hotline poster (see FAR 3.1003).</P>
                            <CITA>[73 FR 46815, Aug. 12, 2008, as amended at 74 FR 53413, Oct. 19, 2009; 75 FR 59101, Sept. 27, 2010, as amended at 76 FR 32840, June 6, 2011; 76 FR 57674, Sept. 16, 2011; 78 FR 37983, June 25, 2013; 80 FR 5000, Jan. 29, 2015; 80 FR 36904, June 26, 2015; 85 FR 61504, Sept. 29, 2020; 88 FR 6580, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 204</EAR>
                    <HD SOURCE="HED">PART 204—ADMINISTRATIVE AND INFORMATION MATTERS</HD>
                    <CONTENTS>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 204.1—Contract Execution</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>204.101</SECTNO>
                            <SUBJECT>Contracting officer's signature.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 204.2—Contract Distribution</HD>
                            <SECTNO>204.201</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>204.203</SECTNO>
                            <SUBJECT>Taxpayer identification information.</SUBJECT>
                            <SECTNO>204.270</SECTNO>
                            <SUBJECT>Electronic Document Access.</SUBJECT>
                            <SECTNO>204.270-1</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>204.270-2</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 204.4—Safeguarding Classified Information Within Industry</HD>
                            <SECTNO>204.402</SECTNO>
                            <SUBJECT>
                                General.
                                <PRTPAGE P="24"/>
                            </SUBJECT>
                            <SECTNO>204.403</SECTNO>
                            <SUBJECT>Responsibilities of contracting officers.</SUBJECT>
                            <SECTNO>204.404</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <SECTNO>204.404-70</SECTNO>
                            <SUBJECT>Additional contract clauses.</SUBJECT>
                            <SECTNO>204.470</SECTNO>
                            <SUBJECT>U.S.-International Atomic Energy Agency Additional Protocol.</SUBJECT>
                            <SECTNO>204.470-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>204.470-2</SECTNO>
                            <SUBJECT>National security exclusion.</SUBJECT>
                            <SECTNO>204.470-3</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 204.6—Contract Reporting</HD>
                            <SECTNO>204.602</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>204.604</SECTNO>
                            <SUBJECT>Responsibilities.</SUBJECT>
                            <SECTNO>204.606</SECTNO>
                            <SUBJECT>Reporting data.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 204.8—Contract Files</HD>
                            <SECTNO>204.802</SECTNO>
                            <SUBJECT>Contract files.</SUBJECT>
                            <SECTNO>204.804</SECTNO>
                            <SUBJECT>Closeout of contract files.</SUBJECT>
                            <SECTNO>204.804-70</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <SECTNO>204.805</SECTNO>
                            <SUBJECT>Disposal of contract files.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 204.9—Taxpayer Identification Number Information</HD>
                            <SECTNO>204.902</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 204.11—System For Award Management</HD>
                            <SECTNO>204.1103</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 204.12—Annual Representations and Certifications</HD>
                            <SECTNO>204.1202</SECTNO>
                            <SUBJECT>Solicitation provision and contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 204.16—Uniform Procurement Instrument Identifiers</HD>
                            <SECTNO>204.1601</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>204.1603</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>204.1670</SECTNO>
                            <SUBJECT>Cross reference to Federal Procurement Data System.</SUBJECT>
                            <SECTNO>204.1671</SECTNO>
                            <SUBJECT>Order of application for modifications.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">SUBPART 204.17—SERVICE CONTRACTS INVENTORY</HD>
                            <SECTNO>204.1700</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>204.1701</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>204.1703</SECTNO>
                            <SUBJECT>Reporting requirements.</SUBJECT>
                            <SECTNO>204.1705</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 204.18—Commercial and Government Entity Code</HD>
                            <SECTNO>204.1870</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 204.21—Prohibition on Contracting for Certain Telecommunications and Video Surveillance Services or Equipment</HD>
                            <SECTNO>204.2100</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>204.2101</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>204.2102</SECTNO>
                            <SUBJECT>Prohibition.</SUBJECT>
                            <SECTNO>204.2103</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>204.2104</SECTNO>
                            <SUBJECT>Waivers.</SUBJECT>
                            <SECTNO>204.2105</SECTNO>
                            <SUBJECT>Solicitation provisions and contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <RESERVED>Subpart 204.70—[Reserved]</RESERVED>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 204.71—Uniform Contract Line Item Numbering System</HD>
                            <SECTNO>204.7100</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>204.7101</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>204.7102</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>204.7103</SECTNO>
                            <SUBJECT>Contract line items.</SUBJECT>
                            <SECTNO>204.7103-1</SECTNO>
                            <SUBJECT>Criteria for establishing.</SUBJECT>
                            <SECTNO>204.7103-2</SECTNO>
                            <SUBJECT>Numbering procedures.</SUBJECT>
                            <SECTNO>204.7104</SECTNO>
                            <SUBJECT>Contract subline items.</SUBJECT>
                            <SECTNO>204.7104-1</SECTNO>
                            <SUBJECT>Criteria for establishing.</SUBJECT>
                            <SECTNO>204.7104-2</SECTNO>
                            <SUBJECT>Numbering procedures.</SUBJECT>
                            <SECTNO>204.7105</SECTNO>
                            <SUBJECT>Contract exhibits and attachments.</SUBJECT>
                            <SECTNO>204.7106</SECTNO>
                            <SUBJECT>Contract modifications.</SUBJECT>
                            <SECTNO>204.7107</SECTNO>
                            <SUBJECT>Contract accounting classification reference number (ACRN) and agency accounting identifier (AAI).</SUBJECT>
                            <SECTNO>204.7108</SECTNO>
                            <SUBJECT>Payment instructions.</SUBJECT>
                            <SECTNO>204.7109</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">SUBPART 204.72—ANTITERRORISM AWARENESS TRAINING</HD>
                            <SECTNO>204.7200</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>204.7201</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <SECTNO>204.7202</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>204.7203</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 204.73—Safeguarding Covered Defense Information and Cyber Incident Reporting</HD>
                            <SECTNO>204.7300</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>204.7301</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>204.7302</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>204.7303</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>204.7304</SECTNO>
                            <SUBJECT>Solicitation provisions and contract clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 204.74—Disclosure of Information to Litigation Support Contractors</HD>
                            <SECTNO>204.7400</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>204.7401</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>204.7402</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>204.7403</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 204.75—Cybersecurity Maturity Model Certification</HD>
                            <SECTNO>204.7500</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>204.7501</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>204.7502</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>204.7503</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 204.76—Supplier Performance Risk System</HD>
                            <SECTNO>204.7600</SECTNO>
                            <SUBJECT>
                                Scope of subpart.
                                <PRTPAGE P="25"/>
                            </SUBJECT>
                            <SECTNO>204.7601</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>204.7602</SECTNO>
                            <SUBJECT>Applicability.</SUBJECT>
                            <SECTNO>204.7603</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>204.7604</SECTNO>
                            <SUBJECT>Solicitation provision.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36289, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 204.1—Contract Execution</HD>
                        <SECTION>
                            <SECTNO>204.101</SECTNO>
                            <SUBJECT>Contracting officer's signature.</SUBJECT>
                            <P>Follow the procedures at PGI 204.101 for signature of contract documents.</P>
                            <CITA>[71 FR 9268, Feb. 23, 2006]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 204.2—Contract Distribution</HD>
                        <SECTION>
                            <SECTNO>204.201</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>Follow the procedures at PGI 204.201 for the distribution of contracts and modifications.</P>
                            <P>(a) In lieu of the requirement at FAR 4.201 (a), contracting officers shall distribute one signed copy or reproduction of the signed contract to the contractor.</P>
                            <CITA>[70 FR 58982, Oct. 11, 2005, as amended at 80 FR 58631, Sept. 30, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.203</SECTNO>
                            <SUBJECT>Taxpayer identification information.</SUBJECT>
                            <P>(b) The procedure at FAR 4.203(b) does not apply to contracts that include the provision at FAR 52.204-7, System for Award Management. The payment office obtains the taxpayer identification number and the type of organization from the System for Award Management database.</P>
                            <CITA>[78 FR 28757, May 16, 2013]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.270</SECTNO>
                            <SUBJECT>Electronic Document Access.</SUBJECT>
                            <CITA>[75 FR 59102, Sept. 27, 2010, as amended at 80 FR 58631, Sept. 30, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.270-1</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>
                                (a) The Electronic Data Access (EDA) system, an online repository for contractual instruments and supporting documents, is DoD's primary tool for electronic distribution of contract documents and contract data. Contract attachments shall be uploaded to EDA, except for contract attachments that are classified, are too sensitive for widespread distribution (
                                <E T="03">e.g.,</E>
                                 personally identifiable information and Privacy Act and Health Insurance Portability and Accountability Act, or cannot be practicably converted to electronic format (
                                <E T="03">e.g.,</E>
                                 samples, drawings, and models). Section J (or similar location when the Uniform Contract Format is not used) shall include the annotation “provided under separate cover” for any attachment not uploaded to EDA.
                            </P>
                            <P>(b) Agencies are responsible for ensuring the following when posting documents, including contractual instruments, to EDA—</P>
                            <P>(1) The timely distribution of documents; and</P>
                            <P>(2) That internal controls are in place to ensure that—</P>
                            <P>(i) The electronic version of a contract document in EDA is an accurate representation of the contract; and</P>
                            <P>(ii) The contract data in EDA is an accurate representation of the underlying contract.</P>
                            <CITA>[80 FR 58631, Sept. 30, 2015, as amended at 84 FR 48510, Sept. 13, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.270-2</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>(b) The procedures at PGI 204.270-2 provide details on how to record the results of data verification in EDA. When these procedures are followed, contract documents and data in EDA are an accurate representation of the contract and therefore may be used for audit purposes.</P>
                            <P>(c) The procedures at PGI 204.270-2(c) provide details on the creation and processing of contract deficiency reports, which are used to correct problems with contracts distributed in EDA.</P>
                            <CITA>[80 FR 58631, Sept. 30, 2015, as amended at 81 FR 72738, Oct. 21, 2016]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 204.4—Safeguarding Classified Information Within Industry</HD>
                        <SECTION>
                            <SECTNO>204.402</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>
                                DoD employees or members of the Armed Forces who are assigned to or visiting a contractor facility and are engaged in oversight of an acquisition 
                                <PRTPAGE P="26"/>
                                program will retain control of their work products, both classified and unclassified (see PGI 204.402).
                            </P>
                            <CITA>[71 FR 9268, Feb. 23, 2006, as amended at 76 FR 76319, Dec. 7, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.403</SECTNO>
                            <SUBJECT>Responsibilities of contracting officers.</SUBJECT>
                            <P>(1) Contracting officers shall ensure that solicitations comply with PGI 204.403(1).</P>
                            <P>(2) For additional guidance on determining a project to be fundamental research in accordance with 252.204-7000(a)(3), see PGI 204.403(2).</P>
                            <CITA>[79 FR 56278, Sept. 19, 2014]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.404</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.404-70</SECTNO>
                            <SUBJECT>Additional contract clauses.</SUBJECT>
                            <P>(a) Use the clause at 252.204-7000, Disclosure of Information, in solicitations and contracts when the contractor will have access to or generate unclassified information that may be sensitive and inappropriate for release to the public.</P>
                            <P>(b) Use the clause at 252.204-7003, Control of Government Personnel Work Product, in all solicitations and contracts.</P>
                            <CITA>[57 FR 14992, Apr. 23, 1992, as amended at 64 FR 45197, Aug. 19, 1999; 84 FR 12139, Apr. 1, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.470</SECTNO>
                            <SUBJECT>U.S.-International Atomic Energy Agency Additional Protocol.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.470-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>Under the U.S.-International Atomic Energy Agency Additional Protocol (U.S.-IAEA AP), the United States is required to declare a wide range of public and private nuclear-related activities to the IAEA and potentially provide access to IAEA inspectors for verification purposes.</P>
                            <CITA>[74 FR 2412, Jan. 15, 2009]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.470-2</SECTNO>
                            <SUBJECT>National security exclusion.</SUBJECT>
                            <P>(a) The U.S.-IAEA AP permits the United States unilaterally to declare exclusions from inspection requirements for activities, or locations or information associated with such activities, with direct national security significance.</P>
                            <P>(b) In order to ensure that all relevant activities are reviewed for direct national security significance, both current and former activities, and associated locations or information, are to be considered for applicability for a national security exclusion.</P>
                            <P>(c) If a DoD program manager receives notification from a contractor that the contractor is required to report any of its activities in accordance with the U.S.-IAEA AP, the program manager will—</P>
                            <P>(1) Conduct a security assessment to determine if, and by what means, access may be granted to the IAEA; or</P>
                            <P>(2) Provide written justification to the component or agency treaty office for application of the national security exclusion at that location to exclude access by the IAEA, in accordance with DoD Instruction 2060.03, Application of the National Security Exclusion to the Agreements Between the United States of America and the International Atomic Energy Agency for the Application of Safeguards in the United States of America.</P>
                            <CITA>[74 FR 2412, Jan. 15, 2009]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.470-3</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at 252.204-7010, Requirement for Contractor to Notify DoD if the Contractor's Activities are Subject to Reporting Under the U.S.-International Atomic Energy Agency Additional Protocol, in solicitations and contracts for research and development or major defense acquisition programs involving—</P>
                            <P>(a) Any fissionable materials (e.g., uranium, plutonium, neptunium, thorium, americium);</P>
                            <P>(b) Other radiological source materials; or</P>
                            <P>(c) Technologies directly related to nuclear power production, including nuclear or radiological waste materials.</P>
                            <CITA>[74 FR 2412, Jan. 15, 2009]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 204.6—Contract Reporting</HD>
                        <SECTION>
                            <SECTNO>204.602</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>
                                See PGI 204.602 for additional information on the Federal Procurement Data System (FPDS) and procedures 
                                <PRTPAGE P="27"/>
                                for resolving technical or policy issues relating to FPDS.
                            </P>
                            <CITA>[74 FR 37644, July 29, 2009]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.604</SECTNO>
                            <SUBJECT>Responsibilities.</SUBJECT>
                            <P>(1) The process for reporting contract actions to FPDS should, where possible, be automated by incorporating it into contract writing systems.</P>
                            <P>(2) Data in FPDS is stored indefinitely and is electronically retrievable. Therefore, the contracting officer may reference the contract action report (CAR) approval date in the associated Government contract file instead of including a paper copy of the electronically submitted CAR in the file. Such reference satisfies contract file documentation requirements of FAR 4.803(a).</P>
                            <P>
                                (3) By December 15th of each year, the chief acquisition officer of each DoD component required to report its contract actions shall submit to the Principal Director, Defense Pricing, Contracting, and Acquisition Policy, its annual certification and data validation results for the preceding fiscal year in accordance with the DoD Data Improvement Plan requirements at 
                                <E T="03">https://www.acq.osd.mil/asda/dpc/ce/cap/index.html.</E>
                                 The Principal Director, Defense Pricing, Contracting, and Acquisition Policy, will submit a consolidated DoD annual certification to the Office of Management and Budget by January 5th of each year.
                            </P>
                            <CITA>[74 FR 37644, July 29, 2009, as amended at 87 FR 15817, Mar. 18, 2022; 89 FR 60831, July 29, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.606</SECTNO>
                            <SUBJECT>Reporting data.</SUBJECT>
                            <P>In addition to FAR 4.606, follow the procedures at PGI 204.606 for reporting data to FPDS.</P>
                            <CITA>[74 FR 37644, July 29, 2009]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 204.8—Contract Files</HD>
                        <SECTION>
                            <SECTNO>204.802</SECTNO>
                            <SUBJECT>Contract files.</SUBJECT>
                            <P>
                                (a) Any document posted to the Electronic Data Access (EDA) system is part of the contract file and is accessible by multiple parties, including the contractor. Do not include in EDA contract documents that are classified, too sensitive for widespread distribution (
                                <E T="03">e.g.,</E>
                                 personally identifiable information and Privacy Act and Health Insurance Portability and Accountability Act), or attachments that cannot be practicably converted to electronic format (
                                <E T="03">e.g.,</E>
                                 samples, drawings, and models). Inclusion of any document in EDA other than contracts, modifications, and orders is optional.
                            </P>
                            <P>(f) A photocopy, facsimile, electronic, mechanically-applied and printed signature, seal, and date are considered to be an original signature, seal, and date.</P>
                            <CITA>[80 FR 58631, Sept. 30, 2015, as amended at 84 FR 48510, Sept. 13, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.804</SECTNO>
                            <SUBJECT>Closeout of contract files.</SUBJECT>
                            <P>(1) Except as provided in paragraph (3) of this section, contracting officers shall close out contracts in accordance with the procedures at PGI 204.804. The closeout date for file purposes shall be determined and documented by the procuring contracting officer.</P>
                            <P>
                                (2) The head of the contracting activity shall assign the highest priority to closeout of contracts awarded for performance in a contingency area. Heads of contracting activities shall monitor and assess on a regular basis the progress of contingency contract closeout activities and take appropriate steps if a backlog occurs. For guidance on the planning and execution of closing out such contracts, see PGI 207.105(b)(20)(C)(
                                <E T="03">8</E>
                                ) and PGI 225.373(e).
                            </P>
                            <P>(3)(i) In accordance with section 836 of the National Defense Authorization Act for Fiscal Year 2017 (Pub. L. 114-328), section 824 of the National Defense Authorization Act for Fiscal Year 2018 (Pub. L. 115-91), and section 820 of the National Defense Authorization Act for Fiscal Year 2021 (Pub. L. 116-283), contracting officers may close out contracts or groups of contracts through issuance of one or more modifications to such contracts without completing a reconciliation audit or other corrective action in accordance with FAR 4.804-5(a)(3) through (15), as appropriate, if each contract—</P>
                            <P>
                                (A)(
                                <E T="03">1</E>
                                ) For military construction (as defined at 10 U.S.C. 2801) or shipbuilding, was awarded at least 10 fiscal years before the current fiscal year; or
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) For all other contracts, was awarded at least 7 fiscal years before the current fiscal year;
                                <PRTPAGE P="28"/>
                            </P>
                            <P>(B) The performance or delivery was completed at least 4 years prior to the current fiscal year; and</P>
                            <P>(C) Has been determined by a contracting official, at least one level above the contracting officer, to be not otherwise reconcilable, because—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) The contract or related payment records have been destroyed or lost; or
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Although contract or related payment records are available, the time or effort required to establish the exact amount owed to the U.S. Government or amount owed to the contractor is disproportionate to the amount at issue.
                            </P>
                            <P>(ii) Any contract or group of contracts meeting the requirements of paragraph (3)(i) of this section may be closed out through a negotiated settlement with the contractor. Except as provided in paragraph (3)(ii)(B) of this section, the contract closeout process shall include a bilateral modification of the affected contract, including those contracts that are closed out in accordance with a negotiated settlement.</P>
                            <P>(A) For a contract or groups of contracts, the contracting officer shall prepare a negotiation settlement memorandum that describes how the requirements of paragraph (3)(i) of this section have been met.</P>
                            <P>(B) For a group of contracts, a bilateral modification of at least one contract shall be made to reflect the negotiated settlement for a group of contracts, and unilateral modifications may be made, as appropriate, to other contracts in the group to reflect the negotiated settlement.</P>
                            <P>(iii) For contract closeout actions under paragraph (3) of this section, remaining contract balances—</P>
                            <P>(A) May be offset with balances in other contract line items within the same contract, regardless of the year or type of appropriation obligated to fund each contract line item and regardless of whether the appropriation obligated to fund such contract line item has closed; and</P>
                            <P>(B) May be offset with balances on other contracts, regardless of the year or type of appropriations obligated to fund each contract and regardless of whether such appropriations have closed.</P>
                            <P>(iv) USD(A&amp;S) is authorized to waive any provision of acquisition law or regulation in order to carry out the closeout procedures authorized in paragraph (3)(i) of this section (see procedures at PGI 204.804(3)(iv).</P>
                            <P>(4) When using the clause at 252.204-7022, Expediting Contract Closeout, to expedite contract closeout, determine the residual dollar amount upon completion of all applicable closeout requirements of FAR 4.804.</P>
                            <CITA>[77 FR 30367, May 22, 2012, as amended at 80 FR 36901, June 26, 2015; 84 FR 18155, Apr. 30, 2019; 86 FR 27277, May 20, 2021; 87 FR 15813, Mar. 18, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.804-70</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at 252.204-7022, Expediting Contract Closeout, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, when the contracting officer intends to expedite contract closeout through the mutual waiver of entitlement to a residual dollar amount of $1,000 or less determined at the time of contract closeout.</P>
                            <CITA>[86 FR 27277, May 20, 2021, as amended at 88 FR 6580, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.805</SECTNO>
                            <SUBJECT>Disposal of contract files.</SUBJECT>
                            <P>(1) The sources of the period for which contract files must be retained are General Records Schedule 3 (Procurement, Supply, and Grant Records) and General Records Schedule 6 (Accountable Officers' Accounts Records). Copies of the General Records Schedule may be obtained from the National Archives and Records Administration, Washington, DC 20408.</P>
                            <P>(2) Deviations from the periods cannot be granted by the Defense Acquisition Regulatory Council. Forward requests for deviations to both the Government Accountability Office and the National Archives and Records Administration.</P>
                            <P>
                                (3) Hold completed contract files in the office responsible for maintaining them for a period of 12 months after completion. After the initial 12 month period, send the records to the local records holding or staging area until they are eligible for destruction. If no space is available locally, transfer the 
                                <PRTPAGE P="29"/>
                                files to the General Services Administration Federal Records Center that services the area.
                            </P>
                            <P>(4) Duplicate or working contract files should contain no originals of materials that properly belong in the official files. Destroy working files as soon as practicable once they are no longer needed.</P>
                            <P>(5) Retain pricing review files, containing documents related to reviews of the contractor's price proposals, subject to certified cost or pricing data (see FAR 15.403-4), for six years. If it is impossible to determine the final payment date in order to measure the six year period, retain the files for nine years.</P>
                            <CITA>[56 FR 36289, July 31, 1991, as amended at 62 FR 40472, July 29, 1997; 63 FR 11528, Mar. 9, 1998; 71 FR 53044, Sept. 8, 2006; 77 FR 76939, Dec. 31, 2012; 80 FR 58632, Sept. 30, 2015]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 204.9—Taxpayer Identification Number Information</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>64 FR 43099, Aug. 9, 1999, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>204.902</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>(b) DoD uses the Federal Procurement Data System (FPDS) to meet these reporting requirements.</P>
                            <CITA>[74 FR 37645, July 29, 2009]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 204.11—System For Award Management</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>68 FR 64558, Nov. 14, 2003, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>204.1103</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>See PGI 204.1103 for helpful information on navigation and data entry in the System for Award Management (SAM) database.</P>
                            <P>(1) On contract award documents, use the contractor's legal or “doing business as” name and physical address information as recorded in the SAM database at the time of award.</P>
                            <P>(2) When making a determination to exercise an option, or at any other time before issuing a modification other than a unilateral modification making an administrative change, ensure that—</P>
                            <P>(i) The contractor's record is active in the SAM database; and</P>
                            <P>(ii) The contractor's unique entity identifier (UEI) number, Commercial and Government Entity (CAGE) code, name, and physical address are accurately reflected in the contract document.</P>
                            <P>(3) At any time, if the UEI number, CAGE code, contractor name, or physical address on a contract no longer matches the information on the contractor's record in the SAM database, the contracting officer shall process a novation or change-of-name agreement, or an address change, as appropriate.</P>
                            <P>(4) See PGI 204.1103 for additional requirements relating to use of information in the SAM database.</P>
                            <P>(5) On contractual documents transmitted to the payment office, provide the CAGE code, instead of the UEI, in accordance with agency procedures.</P>
                            <CITA>[74 FR 37643, July 29, 2009, as amended at 78 FR 28757, May 16, 2013; 89 FR 79002, Sept. 26, 2024]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 204.12—Annual Representations and Certifications</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>73 FR 1823, Jan. 10, 2008, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>204.1202</SECTNO>
                            <SUBJECT>Solicitation provision and contract clause.</SUBJECT>
                            <P>When using the provision at FAR 52.204-8, Annual Representations and Certifications—</P>
                            <P>(1) Use the provision with 252.204-7007, Alternate A, Annual Representations and Certifications; and</P>
                            <P>(2) When the provision at FAR 52.204-7, System for Award Management, is included in the solicitation, do not include separately in the solicitation the following provisions, which are included in DFARS 252.204-7007:</P>
                            <P>(i) 252.204-7016, Covered Defense Telecommunications Equipment or Services—Representation.</P>
                            <P>(ii) 252.209-7002, Disclosure of Ownership or Control by a Foreign Government.</P>
                            <P>
                                (iii) 252.216-7008, Economic Price Adjustment—Wage Rates or Material Prices Controlled by a Foreign Government—Representation.
                                <PRTPAGE P="30"/>
                            </P>
                            <P>(iv) 252.225-7000, Buy American—Balance of Payments Program Certificate.</P>
                            <P>(v) 252.225-7020, Trade Agreements Certificate.</P>
                            <P>(vi) 252.225-7031, Secondary Arab Boycott of Israel.</P>
                            <P>(vii) 252.225-7035, Buy American—Free Trade Agreements—Balance of Payments Program Certificate.</P>
                            <P>(viii) 252.225-7042, Authorization to Perform.</P>
                            <P>(ix) 252.225-7049, Prohibition on Acquisition of Certain Foreign Commercial Satellite Services—Representations.</P>
                            <P>(x) 252.225-7050, Disclosure of Ownership or Control by the Government of a Country that is a State Sponsor of Terrorism.</P>
                            <P>(xi) 252.226-7002, Representation for Demonstration Project for Contractors Employing Persons with Disabilities.</P>
                            <P>(xii) 252.229-7012, Tax Exemptions (Italy)—Representation.</P>
                            <P>(xiii) 252.229-7013, Tax Exemptions (Spain)—Representation.</P>
                            <P>(xiv) 252.232-7015, Performance-Based Payments—Representation.</P>
                            <CITA>[76 FR 58141, Sept. 20, 2011, as amended at 77 FR 19129, Mar. 30, 2012; 77 FR 35879, June 15, 2012; 78 FR 37983, June 25, 2013; 78 FR 40043, July 3, 2013; 79 FR 45664, Aug. 5, 2014; 79 FR 51264, Aug. 28, 2014; 79 FR 73489, Dec. 11, 2014; 80 FR 5000, Jan. 29, 2015; 83 FR 24888, May 30, 2018; 83 FR 66071, Dec. 21, 2018; 84 FR 30947, June 28, 2019; 84 FR 72236, 72559, Dec. 31, 2019; 85 FR 19687, Apr. 8, 2020; 85 FR 74611, Nov. 23, 2020; 89 FR 78991, Sept. 26, 2024]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 204.16—Uniform Procurement Instrument Identifiers</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>81 FR 9785, Feb. 26, 2016, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>204.1601</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Establishment of a Procurement Instrument Identifier (PIID).</E>
                                 Do not reuse a PIID once it has been assigned. Do not assign the same PIID to more than one task or delivery order, even if they are issued under different base contracts or agreements.
                            </P>
                            <P>
                                (b) 
                                <E T="03">Transition of PIID numbering.</E>
                                 Effective October 1, 2016, all DoD components shall comply with the PIID numbering requirements of FAR subpart 4.16 and this subpart for all new solicitations, contracts, orders, and agreements issued, and any amendments and modifications to those new actions. See also PGI 204.1601(b).
                            </P>
                            <P>
                                (c) 
                                <E T="03">Change in the PIID after its assignment.</E>
                                 When a PIID is changed after contract award, the new PIID is known as a continued contract.
                            </P>
                            <P>(i) A continued contract—</P>
                            <P>(A) Does not constitute a new procurement;</P>
                            <P>(B) Incorporates all prices, terms, and conditions of the predecessor contract effective at the time of issuance of the continued contract;</P>
                            <P>(C) Operates as a separate contract independent of the predecessor contract once issued; and</P>
                            <P>(D) Shall not be used to evade competition requirements, expand the scope of work, or extend the period of performance beyond that of the predecessor contract.</P>
                            <P>(ii) When issuing a continued contract, the contracting officer shall—</P>
                            <P>(A) Issue an administrative modification to the predecessor contract to clearly state that—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Any future awards provided for under the terms of the predecessor contract (
                                <E T="03">e.g.,</E>
                                 issuance of orders or exercise of options) will be accomplished under the continued contract; and
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Supplies and services already acquired under the predecessor contract shall remain solely under that contract for purposes of Government inspection, acceptance, payment, and closeout; and
                            </P>
                            <P>(B) Follow the procedures at PGI 204.1601(c).</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.1603</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Elements of a PIID.</E>
                                 DoD-issued PIIDs are thirteen characters in length. Use only alpha-numeric characters, as prescribed in FAR 4.1603 and this subpart. Do not use the letter I or O in any part of the PIID.
                            </P>
                            <P>
                                (3) 
                                <E T="03">Position 9.</E>
                            </P>
                            <P>(A) DoD will use three of the letters reserved for departmental or agency use in FAR 4.1603(a)(3) in this position as follows:</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Use M to identify purchase orders and task or delivery orders issued by the enterprise FedMall system.
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Use S to identify broad agency announcements and commercial solutions openings.
                                <PRTPAGE P="31"/>
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) Use T to identify automated requests for quotations by authorized legacy contract writing systems. See PGI 204.1603(a)(3)(A)(
                                <E T="03">3</E>
                                ) for the list of authorized systems.
                            </P>
                            <P>(B) Do not use other letters identified in FAR 4.1603(a)(3) as “Reserved for future Federal Governmentwide use” or “Reserved for departmental or agency use” in position 9 of the PIID.</P>
                            <P>(C) Do not use the letter C or H for contracts or agreements with provisions for orders or calls.</P>
                            <P>
                                (4) 
                                <E T="03">Positions 10 through 17.</E>
                                 In accordance with FAR 4.1603(a)(4), DoD-issued PIIDs shall only use positions 10 through 13 to complete the PIID. Enter the serial number of the instrument in these positions. A separate series of serial numbers may be used for any type of instrument listed in FAR 4.1603(a)(3). DoD components assign such series of PIID numbers sequentially. A DoD component may reserve blocks of numbers or alpha-numeric numbers for use by its various activities.Use C in position 10 to identify the solicitation as a commercial solutions opening.
                            </P>
                            <P>
                                (b) 
                                <E T="03">Elements of a supplementary PIID.</E>
                                 In addition to the supplementary PIID numbering procedures in FAR 4.1603(b), follow the procedures contained in paragraphs (b)(2)(ii)(
                                <E T="03">1</E>
                                ) and (
                                <E T="03">2</E>
                                ) of this section. See PGI 204.1603(b) for examples of proper supplementary PIID numbering.
                            </P>
                            <P>
                                (2)(ii) 
                                <E T="03">Positions 2 through 6.</E>
                                 In accordance with FAR 4.1603(b)(2)(ii), DoD-issued supplementary PIIDs shall, for positions 2 through 6 of modifications to contracts and agreements, comply with the following:
                            </P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) 
                                <E T="03">Positions 2 and 3.</E>
                                 These two digits may be either alpha or numeric characters, except—
                            </P>
                            <P>
                                (
                                <E T="03">i</E>
                                ) Use K, L, M, N, P, and Q only in position 2, and only if the modification is issued by the Air Force and is a provisioned item order;
                            </P>
                            <P>
                                (
                                <E T="03">ii</E>
                                ) Use S only in position 2, and only to identify modifications issued to provide initial or amended shipping instructions when—
                            </P>
                            <P>
                                (
                                <E T="03">a</E>
                                ) The contract has either FOB origin or destination delivery terms; and
                            </P>
                            <P>
                                (
                                <E T="03">b</E>
                                ) The price changes;
                            </P>
                            <P>
                                (
                                <E T="03">iii</E>
                                ) Use T, U, V, W, X, or Y only in position 2, and only to identify modifications issued to provide initial or amended shipping instructions when—
                            </P>
                            <P>
                                (
                                <E T="03">a</E>
                                ) The contract has FOB origin delivery terms; and
                            </P>
                            <P>
                                (
                                <E T="03">b</E>
                                ) The price does not change; and
                            </P>
                            <P>
                                (
                                <E T="03">iv</E>
                                ) Use Z only in position 2, and only to identify a modification which definitizes a letter contract or a previously issued undefinitized modification.
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) 
                                <E T="03">Positions 4 through 6.</E>
                                 These positions are always numeric. Use a separate series of serial numbers for each type of modification listed in paragraph (b)(2)(ii) of this section.
                            </P>
                            <CITA>[81 FR 9785, Feb. 26, 2016, as amended at 88 FR 55938, Aug. 17, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.1670</SECTNO>
                            <SUBJECT>Cross reference to Federal Procurement Data System.</SUBJECT>
                            <P>Detailed guidance on mapping PIID and supplementary PIID numbers stored in the Electronic Data Access system to data elements reported in the Federal Procurement Data System can be found in PGI 204.1670.</P>
                            <CITA>[81 FR 9785, Feb. 26, 2016, as amended at 84 FR 48510, Sept. 13, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.1671</SECTNO>
                            <SUBJECT>Order of application for modifications.</SUBJECT>
                            <P>(a) Circumstances may exist in which the numeric order of the modifications to a contract is not the order in which the changes to the contract actually take effect.</P>
                            <P>(b) In order to determine the sequence of modifications to a contract or order, the modifications will be applied in the following order—</P>
                            <P>(1) Modifications will be applied in order of the effective date on the modification;</P>
                            <P>(2) In the event of two or more modifications with the same effective date, modifications will be applied in signature date order; and</P>
                            <P>(3) In the event of two or more modifications with the same effective date and the same signature date, procuring contracting office modifications will be applied in numeric order, followed by contract administration office modifications in numeric order.</P>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <PRTPAGE P="32"/>
                        <HD SOURCE="HED">SUBPART 204.17—SERVICE CONTRACTS INVENTORY</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>86 FR 36236, July 9, 2021, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>204.1700</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>This subpart prescribes the requirement to report certain contracted services in accordance with 10 U.S.C. 4505.</P>
                            <CITA>[86 FR 36236, July 9, 2021, as amended at 87 FR 76990, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.1701</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this subpart—</P>
                            <P>
                                <E T="03">First-tier subcontract</E>
                                 means a subcontract awarded directly by the contractor for the purpose of acquiring services for performance of a prime contract. It does not include the contractor's supplier agreements with vendors, such as long-term arrangements for materials or supplies or services that benefit multiple contracts and/or the costs of which are normally applied to a contractor's general and administrative expenses or indirect costs.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.1703</SECTNO>
                            <SUBJECT>Reporting requirements.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Thresholds.</E>
                                 Service contractor reporting of information is required in the System for Award Management (SAM) when a contract or order—
                            </P>
                            <P>(i) Has a total estimated value, including options, that exceeds $3 million; and</P>
                            <P>(ii) Is for services in the following service acquisition portfolio groups (see PGI 204.1703 for a list of applicable product and service codes):</P>
                            <P>(A) Logistics management services.</P>
                            <P>(B) Equipment-related services.</P>
                            <P>(C) Knowledge-based services.</P>
                            <P>(D) Electronics and communications services.</P>
                            <P>
                                (b) 
                                <E T="03">Agency reporting responsibilities.</E>
                                 In the event the agency believes that revisions to the contractor-reported information are warranted, the agency shall notify the contractor.
                            </P>
                            <P>
                                (S-70) 
                                <E T="03">Contractor reporting.</E>
                                 (1) The basic and the alternate of the clause at 252.204-7023, Reporting Requirements for Contracted Services, require contractors to report annually, by October 31, on the services performed under the contract or order, including any first-tier subcontracts, during the preceding Government fiscal year.
                            </P>
                            <P>(2) For indefinite-delivery contracts, basic ordering agreements, and blanket purchase agreements—</P>
                            <P>(i) Contractor reporting is required for each order issued under the contract or agreement that meets the requirements of paragraph (a) of this section; and</P>
                            <P>(ii) Service contract reporting is not required for the basic contract or agreement.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.1705</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>(a)(i) Use the basic or the alternate of the clause at 252.204-7023, Reporting Requirements for Contracted Services, in solicitations, contracts, agreements, and orders, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, that—</P>
                            <P>(A) Have a total estimated value, including options, that exceeds $3 million; and</P>
                            <P>(B) Are for services in the following service acquisition portfolio groups:</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Logistics management services.
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Equipment-related services.
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) Knowledge-based services.
                            </P>
                            <P>
                                (
                                <E T="03">4</E>
                                ) Electronics and communications services.
                            </P>
                            <P>(ii) Use the basic clause in solicitations and contracts, except solicitations and resultant awards of indefinite-delivery contracts, and orders placed under non-DoD contracts that meet the criteria in paragraph (a)(i) of this section.</P>
                            <P>(iii) Use the alternate I clause in solicitations and resultant awards of indefinite-delivery contracts, basic ordering agreements, and blanket purchase agreements, when one or more of the orders under the contract or agreement are expected to meet the criteria in paragraph (a)(i) of this section.</P>
                            <CITA>[86 FR 36236, July 9, 2021, as amended at 88 FR 6580, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 204.18—Commercial and Government Entity Code</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>79 FR 73492, Dec. 11, 2014, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <PRTPAGE P="33"/>
                            <SECTNO>204.1870</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>Follow the procedures and guidance at PGI 204-1870 concerning Commercial and Government Entity (CAGE) codes and CAGE file maintenance.</P>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 204.21—Prohibition on Contracting for Certain Telecommunications and Video Surveillance Services or Equipment</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>84 FR 72236, Dec. 31, 2019, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>204.2100</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>This subpart implements section 1656 of the National Defense Authorization Act for Fiscal Year 2018 (Pub. L. 115-91) and section 889(a)(1)(A) of the National Defense Authorization Act for Fiscal Year 2019 (Pub. L. 115-232).</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.2101</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this subpart—</P>
                            <P>
                                <E T="03">Covered defense telecommunications equipment or services</E>
                                 means—
                            </P>
                            <P>(1) Telecommunications equipment produced by Huawei Technologies Company or ZTE Corporation, or any subsidiary or affiliate of such entities;</P>
                            <P>(2) Telecommunications services provided by such entities or using such equipment; or</P>
                            <P>(3) Telecommunications equipment or services produced or provided by an entity that the Secretary of Defense reasonably believes to be an entity owned or controlled by, or otherwise connected to, the government of a covered foreign country.</P>
                            <P>
                                <E T="03">Covered foreign country</E>
                                 means—
                            </P>
                            <P>(1) The People's Republic of China; or</P>
                            <P>(2) The Russian Federation.</P>
                            <P>
                                <E T="03">Covered missions</E>
                                 means—
                            </P>
                            <P>(1) The nuclear deterrence mission of DoD, including with respect to nuclear command, control, and communications, integrated tactical warning and attack assessment, and continuity of Government; or</P>
                            <P>(2) The homeland defense mission of DoD, including with respect to ballistic missile defense.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.2102</SECTNO>
                            <SUBJECT>Prohibition.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Prohibited equipment, systems, or services.</E>
                                 In addition to the prohibition at FAR 4.2102(a), unless the covered defense telecommunications equipment or services are subject to a waiver described in 204.2104, the contracting officer shall not procure or obtain, or extend or renew a contract (
                                <E T="03">e.g.,</E>
                                 exercise an option) to procure or obtain, any equipment, system, or service to carry out covered missions that uses covered defense telecommunications equipment or services as a substantial or essential component of any system, or as critical technology as part of any system.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.2103</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Representations.</E>
                            </P>
                            <P>(1)(i) If the offeror selects “does not” in response to the provision at DFARS 252.204-7016, the contracting officer may rely on the representation, unless the contracting officer has an independent reason to question the representation. If the contracting officer has a reason to question the “does not” representation in FAR 52.204-26, FAR 52.212-3(v), or 252.204-7016, then the contracting officer shall consult with the requiring activity and legal counsel.</P>
                            <P>(ii) If the offeror selects “does” in paragraph (c) of the provision at DFARS 252.204-7016, the offeror must complete the representation at DFARS 252.204-7017.</P>
                            <P>(2)(i) If the offeror selects “will not” in paragraph (d) of the provision at DFARS 252.204-7017, the contracting officer may rely on the representation, unless the contracting officer has an independent reason to question the representation. If the contracting officer has a reason to question the “will not” representation in FAR 52.204-24 or DFARS 252.204-7017, then the contracting officer shall consult with the requiring activity and legal counsel.</P>
                            <P>(ii) If an offeror selects “will” in paragraph (d) of the provision at DFARS 252.204-7017, the offeror must provide the information required by paragraph (e) of the provision. When an offeror completes paragraph (e) of either of the provisions at FAR 52.204-24 or DFARS 252.204-7017, the contracting officer shall—</P>
                            <P>(A) Forward the offeror's representation and disclosure information to the requiring activity; and</P>
                            <P>
                                (B) Not award to the offeror unless the requiring activity advises—
                                <PRTPAGE P="34"/>
                            </P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) For equipment, systems, or services that use covered telecommunications equipment or services as a substantial or essential component of any system, or as critical technology as part of any system, that a waiver as described at FAR 4.2104 has been granted; or
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) For equipment, systems, or services to be used to carry out covered missions that use covered defense telecommunications equipment or services as a substantial or essential component of any system, or as critical technology as part of any system, that a waiver as described at DFARS 204.2104 has been granted.
                            </P>
                            <P>
                                (b) 
                                <E T="03">Reporting.</E>
                                 If a contractor reports information to 
                                <E T="03">https://dibnet.dod.mil</E>
                                 in accordance with the clause at FAR 52.204-25 or DFARS 252.204-7018, the Defense Cyber Crime Center will notify the contracting officer, who will consult with the requiring activity on how to proceed with the contract.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.2104</SECTNO>
                            <SUBJECT>Waivers.</SUBJECT>
                            <P>The Secretary of Defense may waive the prohibition in 204.2102(a) on a case-by-case basis for a single, one-year period, if the Secretary—</P>
                            <P>(a) Determines such waiver to be in the national security interests of the United States; and</P>
                            <P>(b) Certifies to the Congressional defense committees that—</P>
                            <P>(1) There are sufficient mitigations in place to guarantee the ability of the Secretary to carry out the covered missions; and</P>
                            <P>(2) The Secretary is removing the use of covered defense telecommunications equipment or services in carrying out such missions.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.2105</SECTNO>
                            <SUBJECT>Solicitation provisions and contract clause.</SUBJECT>
                            <P>(a) Use the provision at 252.204-7016, Covered Defense Telecommunications Equipment or Services—Representation, in all solicitations, including solicitations using FAR part 12 procedures for the acquisition of commercial products and commercial services, and solicitations for task orders and delivery orders, basic ordering agreements (BOAs), orders against BOAs, blanket purchase agreements (BPAs), and calls against BPAs.</P>
                            <P>(b) Use the provision at 252.204-7017, Prohibition on the Acquisition of Covered Defense Telecommunications Equipment or Services—Representation, in all solicitations, including solicitations using FAR part 12 procedures for the acquisition of commercial products and commercial services, and solicitations for task orders and delivery orders, BOAs, orders against BOAs, BPAs, and calls against BPAs.</P>
                            <P>(c) Use the clause at 252.204-7018, Prohibition on the Acquisition of Covered Defense Telecommunications Equipment or Services, in all solicitations and resultant awards, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, and solicitations and awards for task orders and delivery orders, BOAs, orders against BOAs, BPAs, and calls against BPAs.</P>
                            <CITA>[84 FR 72236, Dec. 31, 2019, as amended at 88 FR 6580, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <RESERVED>Subpart 204.70—[Reserved]</RESERVED>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 204.71—Uniform Contract Line Item Numbering System</HD>
                        <SECTION>
                            <SECTNO>204.7100</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>This subpart prescribes policies and procedures for assigning contract line item numbers.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.7101</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>
                                <E T="03">Accounting classification reference number (ACRN)</E>
                                 means any combination of a two position alpha/numeric code used as a method of relating the accounting classification citation to detailed line item information contained in the schedule.
                            </P>
                            <P>
                                <E T="03">Attachment</E>
                                 means any documentation, appended to a contract or incorporated by reference, which does not establish a requirement for deliverables.
                            </P>
                            <P>
                                <E T="03">Definitized item,</E>
                                 as used in this subpart, means an item for which a firm price has been established in the basic contract or by modification.
                            </P>
                            <P>
                                <E T="03">Exhibit</E>
                                 means a document, referred to in a contract, which is attached and establishes requirements for deliverables. The term shall not be 
                                <PRTPAGE P="35"/>
                                used to refer to any other kind of attachment to a contract. The DD Form 1423, Contract Data Requirements List, is always an exhibit, rather than an attachment.
                            </P>
                            <P>
                                <E T="03">Nonseverable deliverable,</E>
                                 as used in this subpart, means a deliverable item that is a single end product or undertaking, entire in nature, that cannot be feasibly subdivided into discrete elements or phases without losing its identity.
                            </P>
                            <P>
                                <E T="03">Undefinitized item,</E>
                                 as used in this subpart, means an item for which a price has not been established in the basic contract or by modification.
                            </P>
                            <CITA>[56 FR 36289, July 31, 1991, as amended at 60 FR 34468, July 3, 1995; 70 FR 58982, Oct. 11, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.7102</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(a) The numbering procedures of this subpart shall apply to all—</P>
                            <P>(1) Solicitations;</P>
                            <P>(2) Solicitation line and subline item numbers;</P>
                            <P>(3) Contracts as defined in FAR Subpart 2.1;</P>
                            <P>(4) Contract line and subline item numbers;</P>
                            <P>(5) Exhibits;</P>
                            <P>(6) Exhibit line items; and</P>
                            <P>(7) Any other document expected to become part of the contract.</P>
                            <P>(b) The numbering procedures are mandatory for all contracts where separate contract line item numbers are assigned, unless—</P>
                            <P>(1) The contract is an indefinite-delivery type for petroleum products against which posts, camps, and stations issue delivery orders for products to be consumed by them; or</P>
                            <P>(2) The contract is a communications service authorization issued by the Defense Information Systems Agency's Defense Information Technology Contracting Organization.</P>
                            <CITA>[71 FR 9269, Feb. 23, 2006, as amended at 77 FR 76937, Dec. 31, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.7103</SECTNO>
                            <SUBJECT>Contract line items.</SUBJECT>
                            <P>Follow the procedures at PGI 204.7103 for establishing contract line items.</P>
                            <CITA>[56 FR 36284, July 31, 1991, as amended at 79 FR 51264, Aug. 28, 2014]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.7103-1</SECTNO>
                            <SUBJECT>Criteria for establishing.</SUBJECT>
                            <P>Contracts shall identify the items or services to be acquired as separate contract line items unless it is not feasible to do so.</P>
                            <P>(a) Contract line items shall have all four of the following characteristics; however, there are exceptions within the characteristics, which may make establishing a separate contract line item appropriate even though one of the characteristics appears to be missing—</P>
                            <P>
                                (1) 
                                <E T="03">Single unit price.</E>
                                 The item shall have a single unit price or a single total price, except—
                            </P>
                            <P>(i) If the item is not separately priced (NSP) but the price is included in the unit price of another contract line item, enter NSP instead of the unit price;</P>
                            <P>(ii) When there are associated subline items, established for other than informational reasons, and those subline items are priced in accordance with 204.7104;</P>
                            <P>(iii) When the items or services are being acquired on a cost-reimbursement contract;</P>
                            <P>(iv) When the contract is for maintenance and repair services (e.g., a labor hour contract) and firm prices have been established for elements of the total price of an item but the actual number and quantity of the elements are not known until performance. The contracting officer may structure these contracts to reflect a firm or estimated total amount for each line item;</P>
                            <P>(v) When the contract line item is established to refer to an exhibit or an attachment (if management needs dictate that a unit price be entered, the price shall be set forth in the item description block and enclosed in parentheses); or</P>
                            <P>(vi) When the contract is an indefinite delivery type contract and provides that the price of an item shall be determined at the time a delivery order is placed and the price is influenced by such factors as the quantity ordered (e.g., 10-99 @ $1.00, 100-249 @ $.98, 250+ @ $.95), the destination, the FOB point, or the type of packaging required.</P>
                            <P>
                                (2) 
                                <E T="03">Separately identifiable.</E>
                                 A contract line item must be identified separately 
                                <PRTPAGE P="36"/>
                                from any other items or services on the contract.
                            </P>
                            <P>(i) Supplies are separately identifiable if they have no more than one—</P>
                            <P>(A) National stock number (NSN);</P>
                            <P>(B) Item description; or</P>
                            <P>(C) Manufacturer's part number.</P>
                            <P>(ii) Services are separately identifiable if they have no more than one—</P>
                            <P>(A) Scope of work; or</P>
                            <P>(B) Description of services.</P>
                            <P>(iii) This requirement does not apply if there are associated subline items, established for other than informational reasons, and those subline items include the actual detailed identification in accordance with 204.7104. Where this exception applies, use a general narrative description instead of the contract item description.</P>
                            <P>
                                (3) 
                                <E T="03">Separate delivery schedule.</E>
                                 Each contract line item or service shall have its own delivery schedule, period of performance, or completion date expressly stated (“as required” constitutes an expressly stated delivery term).
                            </P>
                            <P>(i) The fact that there is more than one delivery date, destination, performance date, or performance point may be a determining factor in the decision as to whether to establish more than one contract line item.</P>
                            <P>(ii) If a contract line item has more than one destination or delivery date, the contracting officer may create individual contract line items for the different destinations or delivery dates, or may specify the different delivery dates for the units by destination in the delivery schedule.</P>
                            <P>
                                (4) 
                                <E T="03">Single accounting classification citation.</E>
                                 (i) Each contract line item shall reference a single accounting classification citation except as provided in paragraph (a)(4)(ii) of this subsection.
                            </P>
                            <P>(ii) The use of multiple accounting classification citations for a contract line item is authorized in the following situations:</P>
                            <P>(A) A single, nonseverable deliverable to be paid for with R&amp;D or other funds properly incrementally obligated over several fiscal years in accordance with DoD policy;</P>
                            <P>(B) A single, nonseverable deliverable to be paid for with different authorizations or appropriations, such as in the acquisition of a satellite or the modification of production tooling used to produce items being acquired by several activities; or</P>
                            <P>(C) A modification to an existing contract line item for a nonseverable deliverable that results in the delivery of a modified item(s) where the item(s) and modification are to be paid for with different accounting classification citations.</P>
                            <P>(iii) When the use of multiple accounting classification citations is authorized for a single contract line item, establish informational subline items for each accounting classification citation in accordance with 204.7104-1(a).</P>
                            <P>(b) All subline items and exhibit line items under one contract line item shall be the same contract type as the contract line item.</P>
                            <P>(c) For a contract that contains a combination of fixed-price line items, time-and-materials/labor-hour line items, and/or cost-reimbursement line items, identify the contract type for each contract line item in Section B, Supplies or Services and Prices/Costs, to facilitate appropriate payment.</P>
                            <P>(d) Exhibits may be used as an alternative to putting a long list of contract line items in the schedule. If exhibits are used, create a contract line item citing the exhibit's identifier. See 204.7105.</P>
                            <P>(e) If the contract involves a test model or a first article which must be approved, establish a separate contract line item or subline item for each item of supply or service which must be approved. If the test model or first article consists of a lot composed of a mixture of items, a single line item or subline item may be used for the lot.</P>
                            <P>
                                (f) If a supply or service involves ancillary functions, like packaging and handling, transportation, payment of state or local taxes, or use of reusable containers, and these functions are normally performed by the contractor and the contractor is normally entitled to reimbursement for performing these functions, do not establish a separate contract line item solely to account for these functions. However, do identify the functions in the contract schedule. If the offeror separately prices these functions, contracting officers may establish separate contract line items for the functions; however, the separate 
                                <PRTPAGE P="37"/>
                                line items must conform to the requirements of paragraph (a) of this subsection.
                            </P>
                            <P>(g) Certain commercial products and initial provisioning spares for weapons systems are requested and subsequently solicited using units of measure such as kit, set, or lot. However, there are times when individual items within that kit, set, or lot are not grouped and delivered in a single shipment. This creates potential contract administration issues with inspection, acceptance, and payment. In such cases, solicitations should be structured to allow offerors to provide information about products that may not have been known to the Government prior to solicitation and propose an alternate line item structure as long as the alternate is consistent with the requirements of 204.71, which provides explicit guidance on the use of contract line items and subline items, and with PGI 204.71.</P>
                            <CITA>[56 FR 36289, July 31, 1991, as amended at 60 FR 34468, July 3, 1995; 60 FR 43191, Aug. 18, 1995; 70 FR 58982, Oct. 11, 2005; 76 FR 58139, Sept. 20, 2011; 79 FR 11342, Feb. 28, 2014; 88 FR 6580, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.7103-2</SECTNO>
                            <SUBJECT>Numbering procedures.</SUBJECT>
                            <P>Follow the procedures at PGI 204.7103-2 for numbering contract line items.</P>
                            <CITA>[70 FR 58983, Oct. 11, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.7104</SECTNO>
                            <SUBJECT>Contract subline items.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.7104-1</SECTNO>
                            <SUBJECT>Criteria for establishing.</SUBJECT>
                            <P>Contract subline items provide flexibility to further identify elements within a contract line item for tracking performance or simplifying administration. There are only two kinds of subline items: those which are informational in nature and those which consist of more than one item that requires separate identification.</P>
                            <P>
                                (a) 
                                <E T="03">Informational subline items.</E>
                                 (1) This type of subline item identifies information that relates directly to the contract line item and is an integral part of it (e.g., parts of an assembly or parts of a kit). These subline items shall not be scheduled separately for delivery, identified separately for shipment or performance, or priced separately for payment purposes.
                            </P>
                            <P>(2) The informational subline item may include quantities, prices, or amounts, if necessary to satisfy management requirements. However, these elements shall be included within the item description in the supplies/services column and enclosed in parentheses to prevent confusing them with quantities, prices, or amounts that have contractual significance. Do not enter these elements in the quantity and price columns.</P>
                            <P>(3) Informational subline items shall be used to identify each accounting classification citation assigned to a single contract line item number when use of multiple citations is authorized (see 204.7103-1(a)(4)(ii)).</P>
                            <P>
                                (b) 
                                <E T="03">Separately identified subline items.</E>
                                 (1) Subline items will be used instead of contract line items to facilitate payment, delivery tracking, contract funds accounting, or other management purposes. Such subline items shall be used when items bought under one contract line item number—
                            </P>
                            <P>(i) Are to be paid for from more than one accounting classification. A subline item shall be established for the quantity associated with the single accounting classification citation. Establish a line item rather than a subline item if it is likely that a subline item may be assigned additional accounting classification citations at a later date. Identify the funding as described in 204.7104-1(a)(3);</P>
                            <P>(ii) Are to be packaged in different sizes, each represented by its own NSN;</P>
                            <P>(iii) Have collateral costs, such as packaging costs, but those costs are not a part of the unit price of the contract line item;</P>
                            <P>(iv) Have different delivery dates or destinations or requisitions, or a combination of the three; or</P>
                            <P>(v) Identify parts of an assembly or kit which—</P>
                            <P>(A) Have to be separately identified at the time of shipment or performance; and</P>
                            <P>(B) Are separately priced.</P>
                            <P>(2) Each separately identified contract subline item shall have its own—</P>
                            <P>(i) Delivery schedule, period of performance, or completion date;</P>
                            <P>
                                (ii) Unit price or single total price or amount (not separately priced (NSP) is acceptable as an entry for price or 
                                <PRTPAGE P="38"/>
                                amount if the price is included in another subline item or a different contract line item). This requirement does not apply—
                            </P>
                            <P>(A) If the subline item was created to refer to an exhibit or an attachment. If management needs dictate that a unit price be entered, the price shall be set forth in the item description block of the schedule and enclosed in parentheses; or</P>
                            <P>(B) In the case of indefinite delivery contracts described at 204.7103-1(a)(1)(vi).</P>
                            <P>(iii) Identification (e.g., NSN, item description, manufacturer's part number, scope of work, description of services).</P>
                            <P>(3) Unit prices and extended amounts.</P>
                            <P>(i) The unit price and total amount for all subline items may be entered at the contract line item number level if the unit price for the subline items is identical. If there is any variation, the subline item unit prices shall be entered at the subline item level only.</P>
                            <P>(ii) The unit price and extended amounts may be entered at the subline items level.</P>
                            <P>(iii) The two methods in paragraphs (b)(3) (i) and (ii) of this section shall not be combined in a contract line item.</P>
                            <P>(iv) When the price for items not separately priced is included in the price of another contract line or subline item, it may be necessary to withhold payment on the priced contract line or subline item until the included line or subline items that are not separately priced have been delivered. See the clause at 252.204-7002, Payment for Contract Line or Subline Items Not Separately Priced.</P>
                            <CITA>[56 FR 36289, July 31, 1991, as amended at 60 FR 34468, July 3, 1995; 68 FR 75200, Dec. 30, 2003; 85 FR 19692, Apr. 8, 2020]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.7104-2</SECTNO>
                            <SUBJECT>Numbering procedures.</SUBJECT>
                            <P>Follow the procedures at PGI 204.7104-2 for numbering contract subline items.</P>
                            <CITA>[70 FR 58983, Oct. 11, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.7105</SECTNO>
                            <SUBJECT>Contract exhibits and attachments.</SUBJECT>
                            <P>Follow the procedures at PGI 204.7105 for use and numbering of contract exhibits and attachments.</P>
                            <CITA>[71 FR 9269, Feb. 23, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.7106</SECTNO>
                            <SUBJECT>Contract modifications.</SUBJECT>
                            <P>(a) If new items are added, assign new contract line or subline item numbers or exhibit line item numbers, in accordance with the procedures established at 204.7103, 204.7104, and 204.7105.</P>
                            <P>(b) Modifications to existing contract line items or exhibit line items. (1) If the modification relates to existing contract line items or exhibit line items, the modification shall refer to those item numbers.</P>
                            <P>(2) If the contracting officer decides to assign new identifications to existing contract or exhibit line items, the following rules apply—</P>
                            <P>
                                (i) 
                                <E T="03">Definitized and undefinitized items.</E>
                                 (A) The original line item or subline item number may be used if the modification applies to the total quantity of the original line item or subline.
                            </P>
                            <P>(B) The original line item or subline item number may be used if the modification makes only minor changes in the specifications of some of the items ordered on the original line item or subline item and the resulting changes in unit price can be averaged to provide a new single unit price for the total quantity. If the changes in the specifications make the item significantly distinguishable from the original item or the resulting changes in unit price cannot be averaged, create a new line item.</P>
                            <P>(C) If the modification affects only a partial quantity of an existing contract line item or subline item or exhibit line item and the change does not involve either the delivery date or the ship-to/mark-for data, the original contract line item or subline item or exhibit line item number shall remain with the unchanged quantity. Assign the changed quantity the next available number.</P>
                            <P>
                                (ii) 
                                <E T="03">Undefinitized items.</E>
                                 In addition to the rules in paragraph (b)(2)(i), the following additional rules apply to undefinitized items—
                                <PRTPAGE P="39"/>
                            </P>
                            <P>(A) If the modification is undefinitized and increases the quantity of an existing definitized item, assign the undefinitized quantity the next available number.</P>
                            <P>(B) If the modification increases the quantity of an existing undefinitized item, the original contract line item or subline item or exhibit line item may be used if the unit price for the new quantity is expected to be the same as the price for the original quantity. If the unit prices of the two quantities will be different, assign the new quantity the next available number.</P>
                            <P>(C) If the modification both affects only a partial quantity of the existing contract line item or subline item or exhibit line item and definitizes the price for the affected portion, the definitized portion shall retain the original item number. If there is any undefinitized portion of the item, assign it the next available number. However, if the modification definitizes the price for the whole quantity of the line item, and price impact of the changed work can be apportioned equally over the whole to arrive at a new unit price, the quantity with the changes can be added into the quantity of the existing item.</P>
                            <P>(D) If the modification affects only a partial quantity of an existing contract line item or subline item or exhibit line item but does not change the delivery schedule or definitize price, the unchanged portion shall retain the original contract line item or subline item or exhibit line item number. Assign the changed portion the next available number.</P>
                            <P>(3) If the modification will decrease the amount obligated—</P>
                            <P>(i) There shall be coordination between the administrative and procuring contracting offices before issuance of the modification; and</P>
                            <P>(ii) The contracting officer shall not issue the modification unless sufficient unliquidated obligation exists or the purpose is to recover monies owed to the Government.</P>
                            <CITA>[56 FR 36289, July 31, 1991, as amended at 70 FR 58983, Oct. 11, 2005; 77 FR 76937, Dec. 31, 2012; 78 FR 13543, Feb. 28, 2013]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.7107</SECTNO>
                            <SUBJECT>Contract accounting classification reference number (ACRN) and agency accounting identifier (AAI).</SUBJECT>
                            <P>Traceability of funds from accounting systems to contract actions is accomplished using ACRNs and AAIs. Follow the procedures at PGI 204.7107 for use of ACRNs and AAIs.</P>
                            <CITA>[74 FR 52895, Oct. 15, 2009]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.7108</SECTNO>
                            <SUBJECT>Payment instructions.</SUBJECT>
                            <P>Follow the procedures at PGI 204.7108 for inclusion of payment instructions in contracts.</P>
                            <CITA>[70 FR 58983, Oct. 11, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.7109</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>(a) Use the clause at 252.204-7002, Payment for Contract Line or Subline Items Not Separately Priced, in solicitations and contracts when the price for items not separately priced is included in the price of another contract line or subline item.</P>
                            <P>(b) Use the clause at 252.204-7006, Billing Instructions—Cost Vouchers, in solicitations and contracts when a cost-reimbursement contract, a time-and-materials contract, or a labor-hour contract is contemplated.</P>
                            <CITA>[85 FR 19692, Apr. 8, 2020, as amended at 88 FR 33833, May 25, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 204.72—Antiterrorism Awareness Training</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>84 FR 4363, Feb. 15, 2019, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>204.7200</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>This subpart provides policy and guidance related to antiterrorism awareness training for contractor personnel who require routine physical access to a Federally-controlled facility or military installation.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.7201</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <P>As used in this subpart—</P>
                            <P>
                                <E T="03">Military installation</E>
                                 means a base, camp, post, station, yard, center, or other activity under the jurisdiction of the Secretary of a military department or, in the case of an activity in a foreign country, under the operational control of the Secretary of a military 
                                <PRTPAGE P="40"/>
                                department or the Secretary of Defense (see 10 U.S.C. 2801(c)(4)).
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.7202</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>It is DoD policy that—</P>
                            <P>(a) Contractor personnel who, as a condition of contract performance, require routine physical access to a Federally-controlled facility or military installation are required to complete Level I antiterrorism awareness training within 30 days of requiring access and annually thereafter; and</P>
                            <P>(b) In accordance with Department of Defense Instruction O-2000.16, Volume 1, DoD Antiterrorism (AT) Program Implementation: DoD AT Standards, Level I antiterrorism awareness training may be completed—</P>
                            <P>(1) Through a DoD-sponsored and certified computer or web-based distance learning instruction for Level I antiterrorism awareness; or</P>
                            <P>(2) Under the instruction of a qualified Level I antiterrorism awareness instructor.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.7203</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Include the clause at 252.204-7004, DoD Antiterrorism Awareness Training for Contractors, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, when contractor personnel require routine physical access to a Federally-controlled facility or military installation.</P>
                            <CITA>[84 FR 4363, Feb. 15, 2019, as amended at 88 FR 6580, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 204.73—Safeguarding Covered Defense Information and Cyber Incident Reporting</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>78 FR 69279, Nov. 18, 2013, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>204.7300</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>(a) This subpart applies to contracts and subcontracts requiring contractors and subcontractors to safeguard covered defense information that resides in or transits through covered contractor information systems by applying specified network security requirements. It also requires reporting of cyber incidents.</P>
                            <P>(b) This subpart does not abrogate any other requirements regarding contractor physical, personnel, information, technical, or general administrative security operations governing the protection of unclassified information, nor does it affect requirements of the National Industrial Security Program.</P>
                            <CITA>[80 FR 51742, Aug. 26, 2015, as amended at 81 FR 72998, Oct. 21, 2016]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.7301</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this subpart—</P>
                            <P>
                                <E T="03">Adequate security</E>
                                 means protective measures that are commensurate with the consequences and probability of loss, misuse, or unauthorized access to, or modification of information.
                            </P>
                            <P>
                                <E T="03">Contractor attributional/proprietary information</E>
                                 means information that identifies the contractor(s), whether directly or indirectly, by the grouping of information that can be traced back to the contractor(s) (
                                <E T="03">e.g.,</E>
                                 program description, facility locations), personally identifiable information, as well as trade secrets, commercial or financial information, or other commercially sensitive information that is not customarily shared outside of the company.
                            </P>
                            <P>
                                <E T="03">Controlled technical information</E>
                                 means technical information with military or space application that is subject to controls on the access, use, reproduction, modification, performance, display, release, disclosure, or dissemination. Controlled technical information would meet the criteria, if disseminated, for distribution statements B through F using the criteria set forth in DoD Instruction 5230.24, Distribution Statements on Technical Documents. The term does not include information that is lawfully publicly available without restrictions.
                            </P>
                            <P>
                                <E T="03">Covered contractor information system</E>
                                 means an unclassified information system that is owned, or operated by or for, a contractor and that processes, stores, or transmits covered defense information.
                            </P>
                            <P>
                                <E T="03">Covered defense information</E>
                                 means unclassified controlled technical information or other information (as described in the Controlled Unclassified Information (CUI) Registry at 
                                <E T="03">
                                    http://
                                    <PRTPAGE P="41"/>
                                    www.archives.gov/cui/registry/category-list.html
                                </E>
                                ) that requires safeguarding or dissemination controls pursuant to and consistent with law, regulations, and Governmentwide policies, and is—
                            </P>
                            <P>(1) Marked or otherwise identified in the contract, task order, or delivery order and provided to the contractor by or on behalf of DoD in support of the performance of the contract; or</P>
                            <P>(2) Collected, developed, received, transmitted, used, or stored by or on behalf of the contractor in support of the performance of the contract.</P>
                            <P>
                                <E T="03">Information system</E>
                                 means a discrete set of information resources organized for the collection, processing, maintenance, use, sharing, dissemination, or disposition of information.
                            </P>
                            <P>
                                <E T="03">Media</E>
                                 means physical devices or writing surfaces including, but not limited to, magnetic tapes, optical disks, magnetic disks, large-scale integration memory chips, and printouts onto which covered defense information is recorded, stored, or printed within a covered contractor information system.
                            </P>
                            <P>
                                <E T="03">Rapidly report</E>
                                 means within 72 hours of discovery of any cyber incident.
                            </P>
                            <P>
                                <E T="03">Technical information</E>
                                 means technical data or computer software, as those terms are defined in the clause at DFARS 252.227-7013, Rights in Technical Data—Other Than Commercial Products and Commercial Services, regardless of whether or not the clause is incorporated in the solicitation or contract. Examples of technical information include research and engineering data, engineering drawings, and associated lists, specifications, standards, process sheets, manuals, technical reports, technical orders, catalog-item identifications, data sets, studies and analyses and related information, and computer software executable code and source code.
                            </P>
                            <CITA>[78 FR 69279, Nov. 18, 2013, as amended at 80 FR 51742, Aug. 26, 2015; 81 FR 72998, Oct. 21, 2016; 88 FR 6580, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.7302</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(a)(1) Contractors and subcontractors are required to provide adequate security on all covered contractor information systems.</P>
                            <P>
                                (2) Contractors required to implement NIST SP 800-171, in accordance with the clause at 252.204-7012, Safeguarding Covered Defense Information and Cyber incident Reporting, are required at time of award to have at least a Basic NIST SP 800-171 DoD Assessment that is current (
                                <E T="03">i.e.,</E>
                                 not more than 3 years old unless a lesser time is specified in the solicitation) (see 252.204-7019).
                            </P>
                            <P>
                                (3) The NIST SP 800-171 DoD Assessment Methodology is located at 
                                <E T="03">https://www.acq.osd.mil/asda/dpc/cp/cyber/safeguarding.html#nistSP800171.</E>
                            </P>
                            <P>(4) High NIST SP 800-171 DoD Assessments will be conducted by Government personnel using NIST SP 800-171A, “Assessing Security Requirements for Controlled Unclassified Information.”</P>
                            <P>(5) The NIST SP 800-171 DoD Assessment will not duplicate efforts from any other DoD assessment or the Cybersecurity Maturity Model Certification (CMMC) (see subpart 204.75), except for rare circumstances when a re-assessment may be necessary, such as, but not limited to, when cybersecurity risks, threats, or awareness have changed, requiring a re-assessment to ensure current compliance.</P>
                            <P>
                                (b) Contractors and subcontractors are required to rapidly report cyber incidents directly to DoD at 
                                <E T="03">http://dibnet.dod.mil.</E>
                                 Subcontractors provide the incident report number automatically assigned by DoD to the prime contractor. Lower-tier subcontractors likewise report the incident report number automatically assigned by DoD to their higher-tier subcontractor, until the prime contractor is reached.
                            </P>
                            <P>(1) If a cyber incident occurs, contractors and subcontractors submit to DoD—</P>
                            <P>(i) A cyber incident report;</P>
                            <P>(ii) Malicious software, if detected and isolated; and</P>
                            <P>(iii) Media (or access to covered contractor information systems and equipment) upon request.</P>
                            <P>(2) Contracting officers shall refer to PGI 204.7303-4(c) for instructions on contractor submissions of media and malicious software.</P>
                            <P>
                                (c) Information shared by the contractor may include contractor attributional/proprietary information that is not customarily shared outside 
                                <PRTPAGE P="42"/>
                                of the company, and that the unauthorized use or disclosure of such information could cause substantial competitive harm to the contractor that reported the information. The Government shall protect against the unauthorized use or release of information that includes contractor attributional/proprietary information.
                            </P>
                            <P>(d) A cyber incident that is reported by a contractor or subcontractor shall not, by itself, be interpreted as evidence that the contractor or subcontractor has failed to provide adequate security on their covered contractor information systems, or has otherwise failed to meet the requirements of the clause at 252.204-7012, Safeguarding Covered Defense Information and Cyber Incident Reporting. When a cyber incident is reported, the contracting officer shall consult with the DoD component Chief Information Officer/cyber security office prior to assessing contractor compliance (see PGI 204.7303-3(a)(3)). The contracting officer shall consider such cyber incidents in the context of an overall assessment of a contractor's compliance with the requirements of the clause at 252.204-7012.</P>
                            <P>
                                (e) Support services contractors directly supporting Government activities related to safeguarding covered defense information and cyber incident reporting (
                                <E T="03">e.g.,</E>
                                 forensic analysis, damage assessment,, or other services that require access to data from another contractor) are subject to restrictions on use and disclosure of reported information.
                            </P>
                            <CITA>[80 FR 51742, Aug. 26, 2015, as amended at 81 FR 72998, Oct. 21, 2016; 85 FR 61519, Sept. 29, 2020; 87 FR 15817, Mar. 18, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.7303</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>(a) Follow the procedures relating to safeguarding covered defense information at PGI 204.7303.</P>
                            <P>
                                (b) The contracting officer shall verify that the summary level score of a current NIST SP 800-171 DoD Assessment (
                                <E T="03">i.e.,</E>
                                 not more than 3 years old, unless a lesser time is specified in the solicitation) (see 252.204-7019) for each covered contractor information system that is relevant to an offer, contract, task order, or delivery order are posted in Supplier Performance Risk System (SPRS) (
                                <E T="03">https://www.sprs.csd.disa.mil/</E>
                                ), prior to—
                            </P>
                            <P>(1) Awarding a contract, task order, or delivery order to an offeror or contractor that is required to implement NIST SP 800-171 in accordance with the clause at 252.204-7012; or</P>
                            <P>(2) Exercising an option period or extending the period of performance on a contract, task order, or delivery order with a contractor that is that is required to implement the NIST SP 800-171 in accordance with the clause at 252.204-7012.</P>
                            <CITA>[85 FR 61519, Sept. 29, 2020]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.7304</SECTNO>
                            <SUBJECT>Solicitation provisions and contract clauses.</SUBJECT>
                            <P>(a) Use the provision at 252.204-7008, Compliance with Safeguarding Covered Defense Information Controls, in all solicitations, including solicitations using FAR part 12 procedures for the acquisition of commercial products and commercial services, except for solicitations solely for the acquisition of commercially available off-the-shelf (COTS) items.</P>
                            <P>(b) Use the clause at 252.204-7009, Limitations on the Use or Disclosure of Third-Party Contractor Reported Cyber Incident Information, in all solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, for services that include support for the Government's activities related to safeguarding covered defense information and cyber incident reporting.</P>
                            <P>(c) Use the clause at 252.204-7012, Safeguarding Covered Defense Information and Cyber Incident Reporting, in all solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, except for solicitations and contracts solely for the acquisition of COTS items.</P>
                            <P>
                                (d) Use the provision at 252.204-7019, Notice of NIST SP 800-171 DoD Assessment Requirements, in all solicitations, including solicitations using 
                                <PRTPAGE P="43"/>
                                FAR part 12 procedures for the acquisition of commercial products and commercial services, except for solicitations solely for the acquisition of commercially available off-the-shelf (COTS) items.
                            </P>
                            <P>(e) Use the clause at 252.204-7020, NIST SP 800-171 DoD Assessment Requirements, in all solicitations and contracts, task orders, or delivery orders, including those using FAR part 12 procedures for the acquisition of commercial products and commercial services, except for those that are solely for the acquisition of COTS items.</P>
                            <CITA>[80 FR 51743, Aug. 26, 2015, as amended at 80 FR 56929, Sept. 21, 2015; 81 FR 72999, Oct. 21, 2016; 82 FR 61480, Dec. 28, 2017; 85 FR 61519, Sept. 29, 2020; 88 FR 6581, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 204.74—Disclosure of information to litigation support contractors</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>79 FR 11339, Feb. 28, 2014, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>204.7400</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>This subpart prescribes policies and procedures for the release and safeguarding of information to litigation support contractors. It implements the requirements at 10 U.S.C. 129d.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.7401</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this subpart—</P>
                            <P>
                                <E T="03">Computer software</E>
                                 means computer programs, source code, source code listings, object code listings, design details, algorithms, processes, flow charts, formulae, and related material that would enable the software to be reproduced, recreated, or recompiled. Computer software does not include computer data bases or computer software documentation.
                            </P>
                            <P>
                                <E T="03">Litigation information</E>
                                 means any information, including sensitive information, that is furnished to the contractor by or on behalf of the Government, or that is generated or obtained by the contractor in the performance of litigation support under a contract. The term does not include information that is lawfully, publicly available without restriction, including information contained in a publicly available solicitation.
                            </P>
                            <P>
                                <E T="03">Litigation support</E>
                                 means administrative, technical, or professional services provided in support of the Government during or in anticipation of litigation.
                            </P>
                            <P>
                                <E T="03">Litigation support contractor</E>
                                 means a contractor (including its experts, technical consultants, subcontractors, and suppliers) providing litigation support under a contract that contains the clause at 252.204-7014, Limitations on the Use or Disclosure of Information by Litigation Support Contractors.
                            </P>
                            <P>
                                <E T="03">Sensitive information</E>
                                 means controlled unclassified information of a commercial, financial, proprietary, or privileged nature. The term includes technical data and computer software, but does not include information that is lawfully, publicly available without restriction.
                            </P>
                            <P>
                                <E T="03">Technical data</E>
                                 means recorded information, regardless of the form or method of the recording, of a scientific or technical nature (including computer software documentation). The term does not include computer software or data incidental to contract administration, such as financial and/or management information.
                            </P>
                            <CITA>[81 FR 28727, May 10, 2016]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.7402</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(a) Any release or disclosure of litigation information that includes sensitive information to a litigation support contractor, and the litigation support contractor's use and handling of such information, shall comply with the requirements of 10 U.S.C. 129d.</P>
                            <P>(b) To the maximum extent practicable, DoD will provide notice to an offeror or contractor submitting, delivering, or otherwise providing information to DoD in connection with an offer or performance of a contract that such information may be released or disclosed to litigation support contractors.</P>
                            <P>(c) Information that is publicly available without restriction, including publicly available solicitations for litigation support services, will not be protected from disclosure as litigation information.</P>
                            <P>
                                (d) When sharing sensitive information with a litigation support contractor, contracting officers shall ensure that all other applicable requirements for handling and safeguarding 
                                <PRTPAGE P="44"/>
                                the relevant types of sensitive information are included in the contract (
                                <E T="03">e.g.,</E>
                                 FAR subparts 4.4 and 24.1; DFARS subparts 204.4 and 224.1).
                            </P>
                            <CITA>[79 FR 11339, Feb. 28, 2014, as amended at 81 FR 28728, May 10, 2016]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.7403</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>(a) Use the clause at 252.204-7014, Limitations on the Use or Disclosure of Information by Litigation Support Contractors, in all solicitations and contracts that involve litigation support services, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services.</P>
                            <P>(b) Use the clause at 252.204-7015, Notice of Authorized Disclosure of Information for Litigation Support, in all solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services.</P>
                            <CITA>[81 FR 28728, May 10, 2016, as amended at 84 FR 58332, Oct. 31, 2019; 88 FR 6581, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 204.75—Cybersecurity Maturity Model Certification</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>85 FR 61519, Sept. 29, 2020, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>204.7500</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>
                                (a) This subpart prescribes policies and procedures for including the Cybersecurity Maturity Model Certification (CMMC) level requirements in DoD contracts. CMMC is a framework that measures a contractor's cybersecurity maturity to include the implementation of cybersecurity practices and institutionalization of processes (see 
                                <E T="03">https://www.acq.osd.mil/cmmc/index.html</E>
                                ).
                            </P>
                            <P>(b) This subpart does not abrogate any other requirements regarding contractor physical, personnel, information, technical, or general administrative security operations governing the protection of unclassified information, nor does it affect requirements of the National Industrial Security Program.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.7501</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>
                                (a) The contracting officer shall include in the solicitation the required CMMC level, if provided by the requiring activity. Contracting officers shall not award a contract, task order, or delivery order to an offeror that does not have a current (
                                <E T="03">i.e.,</E>
                                 not more than 3 years old) CMMC certificate at the level required by the solicitation.
                            </P>
                            <P>
                                (b) Contractors are required to achieve, at time of award, a CMMC certificate at the level specified in the solicitation. Contractors are required to maintain a current (
                                <E T="03">i.e.,</E>
                                 not more than 3 years old) CMMC certificate at the specified level, if required by the statement of work or requirement document, throughout the life of the contract, task order, or delivery order. Contracting officers shall not exercise an option period or extend the period of performance on a contract, task order, or delivery order, unless the contract has a current (
                                <E T="03">i.e.,</E>
                                 not more than 3 years old) CMMC certificate at the level required by the contract, task order, or delivery order.
                            </P>
                            <P>(c) The CMMC Assessments shall not duplicate efforts from any other comparable DoD assessment, except for rare circumstances when a re-assessment may be necessary such as, but not limited to when there are indications of issues with cybersecurity and/or compliance with CMMC requirements.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.7502</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>(a) When a requiring activity identifies a requirement for a contract, task order, or delivery order to include a specific CMMC level, the contracting officer shall not—</P>
                            <P>(1) Award to an offeror that does not have a CMMC certificate at the level required by the solicitation; or</P>
                            <P>(2) Exercise an option or extend any period of performance on a contract, task order, or delivery order unless the contractor has a CMMC certificate at the level required by the contract.</P>
                            <P>
                                (b) Contracting officers shall use Supplier Performance Risk System (SPRS) (
                                <E T="03">https://www.sprs.csd.disa.mil/</E>
                                ) to verify an offeror or contractor's CMMC level.
                            </P>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="45"/>
                            <SECTNO>204.7503</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at 252.204-7021, Contractor Compliance with the Cybersecurity Maturity Model Certification Level Requirement, as follows:</P>
                            <P>(a) Until September 30, 2025, in solicitations and contracts or task orders or delivery orders, including those using FAR part 12 procedures for the acquisition of commercial products and commercial services, except for solicitations and contracts or orders solely for the acquisition of commercially available off-the-shelf (COTS) items, if the requirement document or statement of work requires a contractor to have a specific CMMC level. In order to implement a phased rollout of CMMC, inclusion of a CMMC requirement in a solicitation during this time period must be approved by OUSD(A&amp;S).</P>
                            <P>(b) On or after October 1, 2025, in all solicitations and contracts or task orders or delivery orders, including those using FAR part 12 procedures for the acquisition of commercial products and commercial services, except for solicitations and contracts or orders solely for the acquisition of COTS items.</P>
                            <CITA>[85 FR 61519, Sept. 29, 2020, as amended at 88 FR 6581, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 204.76—Supplier Performance Risk System</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>88 FR 17338, Mar. 22, 2023, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>204.7600</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>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.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.7601</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this subpart—</P>
                            <P>
                                <E T="03">Item risk</E>
                                 means the probability that a product, based on intended use, will introduce performance risk resulting in safety issues, mission degradation, or monetary loss.
                            </P>
                            <P>
                                <E T="03">Price risk</E>
                                 means the measure of whether a proposed price for a product or service is consistent with historical prices paid for that item or service.
                            </P>
                            <P>
                                <E T="03">Supplier risk</E>
                                 means the probability that an award may subject the procurement to the risk of unsuccessful performance or to supply chain risk (see 239.7301).
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.7602</SECTNO>
                            <SUBJECT>Applicability.</SUBJECT>
                            <P>
                                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 
                                <E T="03">https://piee.eb.mil/,</E>
                                 and the SPRS user's guides are available at 
                                <E T="03">https://www.sprs.csd.disa.mil/reference.htm.</E>
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.7603</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>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:</P>
                            <P>
                                (a) 
                                <E T="03">Item risk.</E>
                                 (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.
                            </P>
                            <P>
                                (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 
                                <PRTPAGE P="46"/>
                                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:
                            </P>
                            <P>(i) Consulting with the program office.</P>
                            <P>(ii) Including mitigating requirements in the statement of work, as provided by the requiring activity.</P>
                            <P>(iii) Including FAR and DFARS clauses identified in the SPRS application, as appropriate.</P>
                            <P>
                                (b) 
                                <E T="03">Price risk.</E>
                                 (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.
                            </P>
                            <P>(2) The contracting officer shall consider strategies to mitigate price risk, such as the following:</P>
                            <P>(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.</P>
                            <P>(ii) Utilizing appropriate price negotiation techniques and procedures.</P>
                            <P>(iii) Using price reasonableness or price realism techniques at FAR 13.106 or 15.4. See also 215.403-3 when making award decisions.</P>
                            <P>
                                (c) 
                                <E T="03">Supplier risk.</E>
                                 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.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>204.7604</SECTNO>
                            <SUBJECT>Solicitation provision.</SUBJECT>
                            <P>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.</P>
                        </SECTION>
                    </SUBPART>
                </PART>
            </SUBCHAP>
            <SUBCHAP TYPE="P">
                <PRTPAGE P="47"/>
                <HD SOURCE="HED">SUBCHAPTER B—ACQUISITION PLANNING</HD>
                <PART>
                    <EAR>Pt. 205</EAR>
                    <HD SOURCE="HED">PART 205—PUBLICIZING CONTRACT ACTIONS</HD>
                    <CONTENTS>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 205.2—Synopses of Proposed Contract Actions</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>205.203</SECTNO>
                            <SUBJECT>Publicizing and response time.</SUBJECT>
                            <SECTNO>205.205</SECTNO>
                            <SUBJECT>Special situations.</SUBJECT>
                            <SECTNO>205.205-71</SECTNO>
                            <SUBJECT>Only one responsible source.</SUBJECT>
                            <SECTNO>205.207</SECTNO>
                            <SUBJECT>Preparation and transmittal of synopses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 205.3—Synopses of Contract Awards</HD>
                            <SECTNO>205.301</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>205.303</SECTNO>
                            <SUBJECT>Announcement of contract awards.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 205.4—Release of Information</HD>
                            <SECTNO>205.470</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 205.5—Paid Advertisements</HD>
                            <SECTNO>205.502</SECTNO>
                            <SUBJECT>Authority.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36302, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 205.2—Synopses of Proposed Contract Actions</HD>
                        <SECTION>
                            <SECTNO>205.203</SECTNO>
                            <SUBJECT>Publicizing and response time.</SUBJECT>
                            <P>(b) Allow at least 45 days response time when requested by a qualifying or designated country source (as these terms are used in part 225) and the request is consistent with the Government's requirement.</P>
                            <P>(S-70) When using competitive procedures, if a solicitation allowed fewer than 30 days for receipt of offers and resulted in only one offer, the contracting officer shall resolicit, allowing an additional period of at least 30 days for receipt of offers, except as provided in 215.371-4 and 215.371-5.</P>
                            <CITA>[56 FR 36302, July 31, 1991, as amended at 77 FR 39137, June 29, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>205.205</SECTNO>
                            <SUBJECT>Special situations.</SUBJECT>
                            <P>See PGI 205.205 for instructions on the solicitation notice regarding timely definitization of equitable adjustments for change orders under construction contracts.</P>
                            <CITA>[88 FR 73235, Oct. 25, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>205.205-70</SECTNO>
                            <SUBJECT>Notification of bundling of DoD contracts.</SUBJECT>
                            <P>
                                (a) When a proposed acquisition is funded entirely using DoD funds and potentially involves bundling, the contracting officer shall, at least 30 days prior to the release of a solicitation or 30 days prior to placing an order without a solicitation, publish in the Governmentwide point of entry (
                                <E T="03">https://www.sam.gov</E>
                                ) a notification of the intent to bundle the requirement. In addition, if the agency has determined that measurably substantial benefits are expected to be derived as a result of bundling, the notification shall include a brief description of those benefits (
                                <E T="03">see</E>
                                 FAR 7.107).
                            </P>
                            <P>(b) This requirement is in addition to the notification requirements at FAR 10.001(c)(2)(i) and (ii).</P>
                            <CITA>[75 FR 40716, July 13, 2010, as amended at 88 FR 88533, Dec. 22, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>205.205-71</SECTNO>
                            <SUBJECT>Only one responsible source.</SUBJECT>
                            <P>Follow the procedures at PGI 206.302-1(d) prior to soliciting a proposal without providing for full and open competition under the authority at FAR 6.302-1.</P>
                            <CITA>[80 FR 21657, Apr. 20, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>205.207</SECTNO>
                            <SUBJECT>Preparation and transmittal of synopses.</SUBJECT>
                            <P>(a)(i) For numbering synopsis notices, follow the procedures at PGI 205.207(a)(i).</P>
                            <P>(d) For special notices for small business events, follow the procedures at PGI 205.207(d).</P>
                            <CITA>[69 FR 63328, Nov. 1, 2004, as amended at 70 FR 73149, Dec. 9, 2005, 76 FR 76319, Dec. 7, 2011; 79 FR 61581, Oct. 14, 2014]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <PRTPAGE P="48"/>
                        <HD SOURCE="HED">Subpart 205.3—Synopses of Contract Awards</HD>
                        <SECTION>
                            <SECTNO>205.301</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>
                                (a)(S-70) 
                                <E T="03">Synopsis of exceptions to domestic source requirements.</E>
                            </P>
                            <P>
                                (i) In accordance with 10 U.S.C. 4862(k), contracting officers also must synopsize through the Governmentwide point of entry (
                                <E T="03">https://www.sam.gov</E>
                                ), awards exceeding the simplified acquisition threshold that are for the acquisition of any clothing, fiber, yarn, or fabric items described in 225.7002-1(a)(1)(ii) through (x), if—
                            </P>
                            <P>(A) The Secretary concerned has determined that domestic items are not available, in accordance with 225.7002-2(b); or</P>
                            <P>(B) The acquisition is for chemical warfare protective clothing, and the contracting officer has determined that an exception to domestic source requirements applies because the acquisition furthers an agreement with a qualifying country, in accordance with 225.7002-2(n).</P>
                            <P>(ii) The synopsis must be submitted in sufficient time to permit its publication not later than 7 days after contract award.</P>
                            <P>(iii) In addition to the information otherwise required in a synopsis of contract award, the synopsis must include one of the following statements as applicable:</P>
                            <P>(A) “The exception at DFARS 225.7002-2(b) applies to this acquisition, because the Secretary concerned has determined that items grown, reprocessed, reused, or produced in the United States cannot be acquired as and when needed in satisfactory quality and sufficient quantity at U.S. market prices.”</P>
                            <P>(B) “The exception at DFARS 225.7002-2(n) applies to this acquisition, because the contracting officer has determined that this acquisition of chemical warfare protective clothing furthers an agreement with a qualifying country identified in DFARS 225.003(10).”</P>
                            <CITA>[71 FR 58536, Oct. 4, 2006, as amended at 74 FR 52895, Oct. 15, 2009; 74 FR 59914, Nov. 19, 2009; 80 FR 51749, Aug. 26, 2015; 87 FR 76990, Dec. 16, 2022; 88 FR 88533, Dec. 22, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>205.303</SECTNO>
                            <SUBJECT>Announcement of contract awards.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Public announcement.</E>
                                 (i) The threshold for DoD awards is $7.5 million. Report all contractual actions, including modifications, that have a face value, excluding unexercised options, of more than $7.5 million.
                            </P>
                            <P>(A) For undefinitized contractual actions, report the not-to-exceed (NTE) amount. Later, if the definitized amount exceeds the NTE amount by more than $7.5 million, report only the amount exceeding the NTE.</P>
                            <P>(B) For indefinite delivery, time and material, labor hour, and similar contracts, report the initial award if the estimated face value, excluding unexercised options, is more than $7.5 million. Do not report orders up to the estimated value, but after the estimated value is reached, report subsequent modifications and orders that have a face value of more than $7.5 million.</P>
                            <P>(C) Do not report the same work twice.</P>
                            <P>(ii) Departments and agencies submit the information—</P>
                            <P>(A) To the Office of the Assistant to the Secretary of Defense for Public Affairs;</P>
                            <P>(B) By the close of business the day before the date of the proposed award;</P>
                            <P>(C) Using report control symbol DD-LA-(AR) 1279;</P>
                            <P>(D) Including, as a minimum, the following—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) 
                                <E T="03">Contract data.</E>
                                 Contract number, modification number, or delivery order number, face value of this action, total cumulative face value of the contract, description of what is being bought, contract type, whether any of the buy was for foreign military sales (FMS) and identification of the FMS customer;
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) 
                                <E T="03">Competition information.</E>
                                 Number of solicitations mailed and number of offers received;
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) 
                                <E T="03">Contractor data.</E>
                                 Name, address, and place of performance (if significant work is performed at a different location);
                            </P>
                            <P>
                                (
                                <E T="03">4</E>
                                ) 
                                <E T="03">Funding data.</E>
                                 Type of appropriation and fiscal year of the funds, and whether the contract is multiyear (see FAR Subpart 17.1); and
                                <PRTPAGE P="49"/>
                            </P>
                            <P>
                                (
                                <E T="03">5</E>
                                ) 
                                <E T="03">Miscellaneous data.</E>
                                 Identification of the contracting office, the contracting office point of contact, known congressional interest, and the information release date.
                            </P>
                            <P>(iii) Departments and agencies, in accordance with department/agency procedures and concurrent with the public announcement, shall provide information similar to that required by paragraph (a)(ii) of this section to members of Congress in whose state or district the contractor is located and the work is to be performed.</P>
                            <CITA>[56 FR 36302, July 31, 1991, as amended at 56 FR 67212, Dec. 30, 1991; 71 FR 75892, Dec. 19, 2006; 75 FR 45073, Aug. 2, 2010; 80 FR 36904, June 26, 2015; 85 FR 61504, Sept. 29, 2020; 88 FR 73235, Oct. 25, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 205.4—Release of Information</HD>
                        <SECTION>
                            <SECTNO>205.470</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at 252.205-7000, Provision of Information to Cooperative Agreement Holders, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, that are expected to exceed $1.5 million. This clause implements 10 U.S.C. 4957.</P>
                            <CITA>[69 FR 63328, Nov. 1, 2004, as amended at 70 FR 8537, Feb. 22, 2005; 78 FR 37983, June 25, 2013; 85 FR 61504, Sept. 29, 2020; 87 FR 76990, Dec. 16, 2022; 88 FR 6581, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 205.5—Paid Advertisements</HD>
                        <SECTION>
                            <SECTNO>205.502</SECTNO>
                            <SUBJECT>Authority.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Newspapers.</E>
                                 Heads of contracting activities are delegated authority to approve the publication of paid advertisements in newspapers.
                            </P>
                            <CITA>[69 FR 63328, Nov. 1, 2004]</CITA>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 206</EAR>
                    <HD SOURCE="HED">PART 206—COMPETITION REQUIREMENTS</HD>
                    <CONTENTS>
                        <SECHD>Sec.</SECHD>
                        <SECTNO>206.000</SECTNO>
                        <SUBJECT>Scope of part.</SUBJECT>
                        <SECTNO>206.001</SECTNO>
                        <SUBJECT>Applicability.</SUBJECT>
                        <SECTNO>206.001-70</SECTNO>
                        <SUBJECT>Exception for prototype projects for follow-on production contracts.</SUBJECT>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 206.1—Full and Open Competition</HD>
                            <SECTNO>206.102</SECTNO>
                            <SUBJECT>Use of competitive procedures.</SUBJECT>
                            <SECTNO>206.102-70</SECTNO>
                            <SUBJECT>Other competitive procedures.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 206.2—Full and Open Competition After Exclusion of Sources</HD>
                            <SECTNO>206.202</SECTNO>
                            <SUBJECT>Establishing or maintaining alternative sources.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 206.3—Other Than Full and Open Competition</HD>
                            <SECTNO>206.302</SECTNO>
                            <SUBJECT>Circumstances permitting other than full and open competition.</SUBJECT>
                            <SECTNO>206.302-1</SECTNO>
                            <SUBJECT>Only one responsible source and no other supplies or services will satisfy agency requirements.</SUBJECT>
                            <SECTNO>206.302-2</SECTNO>
                            <SUBJECT>Unusual and compelling urgency.</SUBJECT>
                            <SECTNO>206.302-3</SECTNO>
                            <SUBJECT>Industrial mobilization, engineering, developmental, or research capability, or expert services.</SUBJECT>
                            <SECTNO>206.302-3-70</SECTNO>
                            <SUBJECT>Solicitation provision.</SUBJECT>
                            <SECTNO>206.302-4</SECTNO>
                            <SUBJECT>International agreement.</SUBJECT>
                            <SECTNO>206.302-5</SECTNO>
                            <SUBJECT>Authorized or required by statute.</SUBJECT>
                            <SECTNO>206.302-7</SECTNO>
                            <SUBJECT>Public interest.</SUBJECT>
                            <SECTNO>206.303</SECTNO>
                            <SUBJECT>Justifications.</SUBJECT>
                            <SECTNO>206.303-1</SECTNO>
                            <SUBJECT>Requirements.</SUBJECT>
                            <SECTNO>206.303-2</SECTNO>
                            <SUBJECT>Content.</SUBJECT>
                            <SECTNO>206.303-70</SECTNO>
                            <SUBJECT>Acquisitions in support of operations in Afghanistan.</SUBJECT>
                            <SECTNO>206.304</SECTNO>
                            <SUBJECT>Approval of the justification.</SUBJECT>
                            <SECTNO>206.305</SECTNO>
                            <SUBJECT>Availability of the justification.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36303, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SECTION>
                        <SECTNO>206.000</SECTNO>
                        <SUBJECT>Scope of part.</SUBJECT>
                        <P>For information on the various approaches that may be used to competitively fulfill DoD requirements, see PGI 206.000.</P>
                        <CITA>[80 FR 21657, Apr. 20, 2015]</CITA>
                    </SECTION>
                    <SECTION>
                        <SECTNO>206.001</SECTNO>
                        <SUBJECT>Applicability.</SUBJECT>
                        <P>(b) As authorized by 10 U.S.C. 1091, contracts awarded to individuals using the procedures at 237.104(b)(ii) are exempt from the competitive requirements of FAR part 6.</P>
                        <CITA>[70 FR 2361, Jan. 13, 2005, as amended at 87 FR 10990, Feb. 28, 2022]</CITA>
                    </SECTION>
                    <SECTION>
                        <SECTNO>206.001-70</SECTNO>
                        <SUBJECT>Exception for prototype projects for follow-on production contracts.</SUBJECT>
                        <P>
                            (a) Also excepted from this part are follow-on production contracts for products developed pursuant to the “other transactions” authority of 10 
                            <PRTPAGE P="50"/>
                            U.S.C. 4022 for prototype projects, when the contracting officer receives sufficient documentation from the agreements officer issuing the other transaction agreement for the prototype project that—
                        </P>
                        <P>(1) The other transaction agreement included provisions for a follow-on production contract (10 U.S.C. 4022(f)(1)); and</P>
                        <P>(2) Where applicable, the threshold at 10 U.S.C. 4022(a)(2)(C) and the requirements at 10 U.S.C. 4022(f)(2)(A) and (B) have been met.</P>
                        <P>(b) See PGI 206.001-70 for additional guidance.</P>
                        <CITA>[88 FR 33835, May 25, 2023]</CITA>
                    </SECTION>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 206.1—Full and Open Competition</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>84 FR 4365, Feb. 15, 2019, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>206.102</SECTNO>
                            <SUBJECT>Use of competitive procedures.</SUBJECT>
                            <P>
                                (d) 
                                <E T="03">Other competitive procedures.</E>
                            </P>
                            <P>(2) In lieu of FAR 6.102(d)(2), competitive selection of science and technology proposals resulting from a broad agency announcement with peer or scientific review, as described in 235.016(a) (10 U.S.C. 3012(2)).</P>
                            <CITA>[84 FR 4365, Feb. 15, 2019, as amended at 87 FR 76990, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>206.102-70</SECTNO>
                            <SUBJECT>Other competitive procedures.</SUBJECT>
                            <P>(a) Competitive selection of proposals based on a review by scientific, technological, or other subject-matter expert peers resulting from a commercial solutions opening as described in subpart 212.70 (10 U.S.C. 3458) is a competitive procedure.</P>
                            <P>(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.</P>
                            <CITA>[88 FR 55939, Aug. 17, 2023, as amended at 89 FR 79001, Sept. 26, 2024]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 206.2—Full and Open Competition After Exclusion of Sources</HD>
                        <SECTION>
                            <SECTNO>206.202</SECTNO>
                            <SUBJECT>Establishing or maintaining alternative sources.</SUBJECT>
                            <P>(a) Agencies may use this authority to totally or partially exclude a particular source from a contract action.</P>
                            <P>(b) The determination and findings (D&amp;F) and the documentation supporting the D&amp;F shall identify the source to be excluded from the contract action. Include the information at PGI 206.202(b), as applicable, and any other information that may be pertinent, in the supporting documentation.</P>
                            <CITA>[69 FR 74991, Dec. 15, 2004]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 206.3—Other Than Full and Open Competition</HD>
                        <SECTION>
                            <SECTNO>206.302</SECTNO>
                            <SUBJECT>Circumstances permitting other than full and open competition.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>206.302-1</SECTNO>
                            <SUBJECT>Only one responsible source and no other supplies or services will satisfy agency requirements.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Authority.</E>
                                 (2)(i) Section 8059 of Pub. L. 101-511 and similar sections in subsequent defense appropriations acts prohibit departments and agencies from entering into contracts for studies, analyses, or consulting services (see FAR subpart 37.2) on the basis of an unsolicited proposal without providing for full and open competition, unless—
                            </P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) The head of the contracting activity, or a designee no lower than chief of the contracting office, determines that—
                            </P>
                            <P>
                                (
                                <E T="03">i</E>
                                ) Following thorough technical evaluation, only one source is fully qualified to perform the proposed work;
                            </P>
                            <P>
                                (
                                <E T="03">ii</E>
                                ) The unsolicited proposal offers significant scientific or technological promise, represents the product of original thinking, and was submitted in confidence; or
                            </P>
                            <P>
                                (
                                <E T="03">iii</E>
                                ) The contract benefits the national defense by taking advantage of a unique and significant industrial accomplishment or by ensuring financial support to a new product or idea;
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) A civilian official of the DoD, whose appointment has been confirmed by the Senate, determines the award to 
                                <PRTPAGE P="51"/>
                                be in the interest of national defense; or
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) The contract is related to improvement of equipment that is in development or production.
                            </P>
                            <P>
                                (b) 
                                <E T="03">Application.</E>
                                 This authority may be used for acquisitions of test articles and associated support services from a designated foreign source under the DoD Foreign Comparative Testing Program.
                            </P>
                            <P>
                                (c) 
                                <E T="03">Application for brand-name descriptions.</E>
                            </P>
                            <P>(2) Notwithstanding FAR 6.302-1(c)(2), in accordance with section 888(a) of the National Defense Authorization Act for Fiscal Year 2017 (Pub. L. 114-328), the justification and approval addressed in FAR 6.303 is required in order to use brand name or equal descriptions.</P>
                            <P>
                                (d) 
                                <E T="03">Limitations.</E>
                                 Follow the procedures at PGI 206.302-1(d) prior to soliciting a proposal without providing for full and open competition under this authority.
                            </P>
                            <P>
                                (S-70) 
                                <E T="03">Application for proprietary specifications or standards</E>
                                . In accordance with section 888(a) of the National Defense Authorization Act for Fiscal Year 2017 (Pub. L. 114-328), the justification and approval addressed in FAR 6.303 is required in order to use proprietary specifications and standards.
                            </P>
                            <CITA>[56 FR 36303, July 31, 1991, as amended at 57 FR 14992, Apr. 23, 1992; 58 FR 28463, May 13, 1993; 69 FR 74991, Dec. 15, 2004; 80 FR 21657, Apr. 20, 2015; 84 FR 25192, May 31, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>206.302-2</SECTNO>
                            <SUBJECT>Unusual and compelling urgency.</SUBJECT>
                            <P>
                                (b) 
                                <E T="03">Application.</E>
                                 For guidance on circumstances under which use of this authority may be appropriate, see PGI 206.302-2(b).
                            </P>
                            <CITA>[69 FR 74991, Dec. 15, 2004]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>206.302-3</SECTNO>
                            <SUBJECT>Industrial mobilization, engineering, developmental, or research capability, or expert services.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>206.302-3-70</SECTNO>
                            <SUBJECT>Solicitation provision.</SUBJECT>
                            <P>Use the provision at 252.206-7000, Domestic Source Restriction, in all solicitations that are restricted to domestic sources under the authority of FAR 6.302-3.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>206.302-4</SECTNO>
                            <SUBJECT>International agreement.</SUBJECT>
                            <P>
                                (c) 
                                <E T="03">Limitations.</E>
                                 Pursuant to 10 U.S.C. 3204(e)(4)(E), the justifications and approvals described in FAR 6.303 and 6.304 are not required if the head of the contracting activity prepares a document that describes the terms of an agreement or treaty or the written directions, such as a Letter of Offer and Acceptance, that have the effect of requiring the use of other than competitive procedures for the acquisition.
                            </P>
                            <CITA>[63 FR 67803, Dec. 9, 1998, as amended at 87 FR 76990, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>206.302-5</SECTNO>
                            <SUBJECT>Authorized or required by statute.</SUBJECT>
                            <P>
                                (b) 
                                <E T="03">Application.</E>
                                 Agencies may use this authority to—
                            </P>
                            <P>(i) Acquire supplies and services from military exchange stores outside the United States for use by the armed forces outside the United States in accordance with 10 U.S.C. 2424(a) and subject to the limitations of 10 U.S.C. 2424(b). The limitations of 10 U.S.C. 2424(b) (1) and (2) do not apply to the purchase of soft drinks that are manufactured in the United States. For the purposes of 10 U.S.C. 2424, soft drinks manufactured in the United States are brand name carbonated sodas, manufactured in the United States, as evidenced by product markings.</P>
                            <P>(ii) Acquire police, fire protection, airfield operation, or other community services from local governments at military installations to be closed under the circumstances in 237.7401 (Section 2907 of Fiscal Year 1994 Defense Authorization Act (Pub. L. 103-160)).</P>
                            <P>
                                (c) 
                                <E T="03">Limitations.</E>
                                 (i) 10 U.S.C. 4141 precludes use of this exception for awards to colleges or universities for the performance of research and development, or for the construction of any research or other facility, unless—
                            </P>
                            <P>(A) The statute authorizing or requiring award specifically—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) States that the statute modifies or supersedes the provisions of 10 U.S.C. 4141,
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Identifies the particular college or university involved; and
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) States that award is being made in contravention of 10 U.S.C. 4141(a); and
                                <PRTPAGE P="52"/>
                            </P>
                            <P>(B) The Secretary of Defense provides Congress written notice of intent to award. The contract cannot be awarded until 180 days have elapsed since the date Congress received the notice of intent to award. Contracting activities must submit a draft notice of intent with supporting documentation through channels to the Principal Director, Defense Pricing, Contracting, and Acquisition Policy, Office of the Under Secretary of Defense (Acquisition and Sustainment).</P>
                            <P>(ii) The limitation in paragraph (c)(i) of this subsection applies only if the statute authorizing or requiring award was enacted after September 30, 1989.</P>
                            <P>(iii) Subsequent statutes may provide different or additional constraints on the award of contracts to specified colleges and universities. Contracting officers should consult legal counsel on a case-by-case basis.</P>
                            <CITA>[56 FR 36303, July 31, 1991, as amended at 57 FR 14992, Apr. 23, 1992; 58 FR 28463, May 13, 1993; 59 FR 36089, July 15, 1994; 60 FR 29497, June 5, 1995; 60 FR 40107, Aug. 7, 1995; 65 FR 39704, June 27, 2000; 68 FR 7439, Feb. 14, 2003; 87 FR 76990, Dec. 16, 2022; 88 FR 73236, Oct. 25, 2023; 89 FR 60831, July 29, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>206.302-7</SECTNO>
                            <SUBJECT>Public interest.</SUBJECT>
                            <P>
                                (c) 
                                <E T="03">Limitations.</E>
                                 For the defense agencies, the written determination to use this authority must be made by the Secretary of Defense.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>206.303</SECTNO>
                            <SUBJECT>Justifications.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>206.303-1</SECTNO>
                            <SUBJECT>Requirements.</SUBJECT>
                            <P>(a) In accordance with section 823 of the National Defense Authorization Act for Fiscal Year 2020 (Pub. L. 116-92), no justification and approval is required for a sole-source contract under the 8(a) authority (15 U.S.C. 637(a)) for an amount not exceeding $100 million.</P>
                            <P>(b) In lieu of FAR 6.303-1(b), in accordance with section 823 of the National Defense Authorization Act for Fiscal Year 2020 (Pub. L. 116-92), contracting officers shall not award a sole source contract under the 8(a) authority (15 U.S.C. 637(a)) for an amount exceeding $100 million unless—</P>
                            <P>(1) The contracting officer justifies the use of a sole source contract in writing in accordance with FAR 6.303-2;</P>
                            <P>(2) The justification is approved in accordance with 206.304(a)(S-71); and</P>
                            <P>(3) The justification and related information are made public after award in accordance with FAR 6.305.</P>
                            <CITA>[85 FR 34529, June 5, 2020]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>206.303-2</SECTNO>
                            <SUBJECT>Content.</SUBJECT>
                            <P>(b)(i) In lieu of the threshold at FAR 6.303-2(b), each justification shall include the information at FAR 6.303-2(b), except for sole-source 8(a) contracts over $100 million (see paragraph (d) of this section).</P>
                            <P>(ii) Include the information required by PGI 206.303-2(b)(i) in justifications citing the authority at FAR 6.302-1.</P>
                            <P>(d) In lieu of the threshold at FAR 6.303-2(d), each justification for a sole-source 8(a) contract over $100 million shall include the information at FAR 6.303-2(d).</P>
                            <CITA>[80 FR 21657, Apr. 20, 2015, as amended at 85 FR 34529, June 5, 2020]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>206.303-70</SECTNO>
                            <SUBJECT>Acquisitions in support of operations in Afghanistan.</SUBJECT>
                            <P>The justification and approval addressed in FAR 6.303 is not required for acquisitions conducted using a procedure specified in 225.7703-1(a).</P>
                            <CITA>[73 FR 53152, Sept. 15, 2008, as amended at 78 FR 59856, Sept. 30, 2013]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>206.304</SECTNO>
                            <SUBJECT>Approval of the justification.</SUBJECT>
                            <P>(a)(4) The Under Secretary of Defense (Acquisition and Sustainment) may delegate this authority to—</P>
                            <P>(A) An Assistant Secretary of Defense; or</P>
                            <P>(B) For a defense agency, an officer or employee serving in, assigned, or detailed to that agency who—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) If a member of the armed forces, is serving in a rank above brigadier general or rear admiral (lower half); or
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) If a civilian, is serving in a position with a grade under the General Schedule (or any other schedule for civilian officers or employees) that is comparable to or higher than the grade of major general or rear admiral.
                            </P>
                            <P>
                                (S-70) For a noncompetitive follow-on acquisition to a previous award for the same supply or service supported by a justification for other than full 
                                <PRTPAGE P="53"/>
                                and open competition citing the authority at FAR 6.302-1, follow the procedures at PGI 206.304(a)(S-70).
                            </P>
                            <P>(S-71) In accordance with section 823 of the National Defense Authorization Act for Fiscal Year 2020 (Pub. L. 116-92), the head of the procuring activity is the approval authority for a proposed sole-source 8(a) contract exceeding $100 million. This authority may only be delegated to an officer or employee who—</P>
                            <P>(1) If a member of the armed forces, is serving in a rank above brigadier general or rear admiral (lower half); or</P>
                            <P>(2) If a civilian, is serving in a position with a grade under the General Schedule (or any other schedule for civilian officers or employees) that is comparable to or higher than the grade of major general or rear admiral.</P>
                            <CITA>[61 FR 10285, Mar. 13, 1995, as amended at 61 FR 50451, Sept. 26, 1996; 65 FR 39704, June 27, 2000; 80 FR 21657, Apr. 20, 2015; 85 FR 34529, June 5, 2020; 88 FR 73236, Oct. 25, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>206.305</SECTNO>
                            <SUBJECT>Availability of the justification.</SUBJECT>
                            <P>See PGI 206.305 for further guidance on the requirements for preparing, obtaining approval, and posting justification and approval documents for contracts awarded using the authority of FAR 6.302-2.</P>
                            <CITA>[80 FR 67255, Oct. 30, 2015]</CITA>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 207</EAR>
                    <HD SOURCE="HED">PART 207—ACQUISITION PLANNING</HD>
                    <CONTENTS>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 207.1—Acquisition Plans</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>207.102</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>207.103</SECTNO>
                            <SUBJECT>Agency-head responsibilities.</SUBJECT>
                            <SECTNO>207.104</SECTNO>
                            <SUBJECT>General procedures.</SUBJECT>
                            <SECTNO>207.105</SECTNO>
                            <SUBJECT>Contents of written acquisition plans.</SUBJECT>
                            <SECTNO>207.106</SECTNO>
                            <SUBJECT> Additional requirements for major systems.</SUBJECT>
                            <SECTNO>207.108</SECTNO>
                            <SUBJECT>Additional requirements for telecommuting.</SUBJECT>
                            <SECTNO>207.170</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>207.171</SECTNO>
                            <SUBJECT>Component breakout.</SUBJECT>
                            <SECTNO>207.171-1</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>207.171-2</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <SECTNO>207.171-3</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>207.171-4</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>207.172</SECTNO>
                            <SUBJECT>Human research.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 207.3—Contractor Versus Government Performance</HD>
                            <SECTNO>207.302</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 207.4—Equipment Acquisition</HD>
                            <SECTNO>207.401</SECTNO>
                            <SUBJECT>Acquisition considerations.</SUBJECT>
                            <SECTNO>207.470</SECTNO>
                            <SUBJECT>Statutory requirements.</SUBJECT>
                            <SECTNO>207.471</SECTNO>
                            <SUBJECT>Funding requirements.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 207.5—Inherently Governmental Functions</HD>
                            <SECTNO>207.500</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>207.503</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 207.70—Buy-to-Budget—Additional Quantities of End Items</HD>
                            <SECTNO>207.7001</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <SECTNO>207.7002</SECTNO>
                            <SUBJECT>Authority to acquire additional quantities of end items.</SUBJECT>
                            <SECTNO>207.7003</SECTNO>
                            <SUBJECT>Limitation.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36305, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 207.1—Acquisition Plans</HD>
                        <SECTION>
                            <SECTNO>207.102</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(a)(1) See 212.102 regarding requirements for a written determination that the commercial product or commercial service definition has been met when using FAR part 12 procedures.</P>
                            <CITA>[73 FR 4114, Jan. 24, 2008, as amended at 88 FR 6581, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>207.103</SECTNO>
                            <SUBJECT>Agency-head responsibilities.</SUBJECT>
                            <P>(d)(i) Prepare written acquisition plans for—</P>
                            <P>(A) Acquisitions for development, as defined in FAR 35.001, when the total cost of all contracts for the acquisition program is estimated at $10 million or more;</P>
                            <P>(B) Acquisitions for production or services when the total cost of all contracts for the acquisition program is estimated at $50 million or more for all years or $25 million or more for any fiscal year; and</P>
                            <P>(C) Any other acquisition considered appropriate by the department or agency.</P>
                            <P>
                                (ii) Written plans are not required in acquisitions for a final buy out or one-time buy. The terms “final buy out” and “one-time buy” refer to a single 
                                <PRTPAGE P="54"/>
                                contract that covers all known present and future requirements. This exception does not apply to a multiyear contract or a contract with options or phases.
                            </P>
                            <P>(e) Prepare written acquisition plans for acquisition programs meeting the thresholds of paragraphs (d)(i)(A) and (B) of this section on a program basis. Other acquisition plans may be written on either a program or an individual contract basis.</P>
                            <P>(g) The program manager, or other official responsible for the program, has overall responsibility for acquisition planning.</P>
                            <P>(h) For procurement of conventional ammunition, as defined in DoDD 5160.65, Single Manager for Conventional Ammunition (SMCA), the SMCA will review the acquisition plan to determine if it is consistent with retaining national technology and industrial base capabilities in accordance with 10 U.S.C. 3204(a)(3) and section 806 of Public Law 105-261. The department or agency—</P>
                            <P>(i) Shall submit the acquisition plan to the address in PGI 207.103(h); and</P>
                            <P>(ii) Shall not proceed with the procurement until the SMCA provides written concurrence with the acquisition plan. In the case of a non-concurrence, the SMCA will resolve issues with the Army Office of the Executive Director for Conventional Ammunition.</P>
                            <CITA>[71 FR 53045, Sept. 8, 2006, as amended at 71 FR 58537, Oct. 4, 2006; 87 FR 76990, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>207.104</SECTNO>
                            <SUBJECT>General procedures.</SUBJECT>
                            <P>In developing an acquisition plan, agency officials shall take into account the requirement for scheduling and conducting a Peer Review in accordance with 201.170.</P>
                            <CITA>[74 FR 37626, July 29, 2009]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>207.105</SECTNO>
                            <SUBJECT>Contents of written acquisition plans.</SUBJECT>
                            <P>In addition to the requirements of FAR 7.105, planners shall follow the procedures at PGI 207.105.</P>
                            <CITA>[71 FR 53045, Sept. 8, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>207.106</SECTNO>
                            <SUBJECT>Additional requirements for major systems.</SUBJECT>
                            <P>(b)(1)(A) The contracting officer is prohibited by 10 U.S.C. 3208(d)(1) from requiring offers for development or production of major systems that would enable the Government to use technical data to competitively reprocure identical items or components of the system if the item or component were developed exclusively at private expense, unless the contracting officer determines that—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) The original supplier of the item or component will be unable to satisfy program schedule or delivery requirements;
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Proposals by the original supplier of the item or component to meet mobilization requirements are insufficient to meet the agency's mobilization needs; or
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) The Government is otherwise entitled to unlimited rights in technical data.
                            </P>
                            <P>
                                (B) If the contracting officer makes a determination, under paragraphs (b)(1)(A) (
                                <E T="03">1</E>
                                ) and (
                                <E T="03">2</E>
                                ) of this section, for a competitive solicitation, 10 U.S.C. 3208(d)(2) requires that the evaluation of items developed at private expense be based on an analysis of the total value, in terms of innovative design, life-cycle costs, and other pertinent factors, of incorporating such items in the system.
                            </P>
                            <P>(S-70)(1) In accordance with 10 U.S.C. 3774(a) and DoD policy requirements, acquisition plans for major weapon systems and subsystems of major weapon systems shall—</P>
                            <P>(i) Assess the long-term technical data and computer software needs of those systems and subsystems; and</P>
                            <P>(ii) Establish acquisition strategies that provide for the technical data and computer software deliverables and associated license rights needed to sustain those systems and subsystems over their life cycle. The strategy may include—</P>
                            <P>(A) The development of maintenance capabilities within DoD; or</P>
                            <P>(B) Competition for contracts for sustainment of the systems or subsystems.</P>
                            <P>
                                (2) Assessments and corresponding acquisition strategies developed under this section shall—
                                <PRTPAGE P="55"/>
                            </P>
                            <P>(i) Be developed before issuance of a solicitation for the weapon system or subsystem;</P>
                            <P>
                                (ii) In accordance with 10 U.S.C. 4328, to emphasize reliability and maintainability in weapon system design, ensure that reliability and maintainability are included in the performance attributes of the key performance parameters on sustainment during the development of capabilities requirements. For additional guidance see PGI 207.105(b)(14)(ii)
                                <E T="03">(2);</E>
                            </P>
                            <P>(iii) Address the merits of including a priced contract option for the future delivery of technical data and computer software, and associated license rights, that were not acquired upon initial contract award;</P>
                            <P>(iv) Address the potential for changes in the sustainment plan over the life cycle of the weapon system or subsystem; and</P>
                            <P>(v) Apply to weapon systems and subsystems that are to be supported by performance-based logistics arrangements as well as to weapon systems and subsystems that are to be supported by other sustainment approaches.</P>
                            <P>(S-71) See 209.570 for policy applicable to acquisition strategies that consider the use of lead system integrators.</P>
                            <P>(S-72)(1) In accordance with section 202 of the Weapon Systems Acquisition Reform Act of 2009 (Pub. L. 111-23), acquisition plans for major defense acquisition programs as defined in 10 U.S.C. 4201, shall include measures that—</P>
                            <P>(i) Ensure competition, or the option of competition, at both the prime contract level and subcontract level (at such tier or tiers as are appropriate) throughout the program life cycle as a means to improve contractor performance; and</P>
                            <P>(ii) Document the rationale for the selection of the appropriate subcontract tier or tiers under paragraph (S-72)(1)(i) of this section, and the measures which will be employed to ensure competition, or the option of competition.</P>
                            <P>(2) Measures to ensure competition, or the option of competition, may include, but are not limited to, cost-effective measures intended to achieve the following:</P>
                            <P>(i) Competitive prototyping.</P>
                            <P>(ii) Dual-sourcing.</P>
                            <P>(iii) Unbundling of contracts.</P>
                            <P>(iv) Funding of next-generation prototype systems or subsystems.</P>
                            <P>(v) Use of modular, open architectures to enable competition for upgrades.</P>
                            <P>(vi) Use of build-to-print approaches to enable production through multiple sources.</P>
                            <P>(vii) Acquisition of complete technical data packages.</P>
                            <P>(viii) Periodic competitions for subsystem upgrades.</P>
                            <P>(ix) Licensing of additional suppliers.</P>
                            <P>(x) Periodic system or program reviews to address long-term competitive effects of program decisions.</P>
                            <P>(3) In order to ensure fair and objective “make-or-buy” decisions by prime contractors, acquisition strategies and resultant solicitations and contracts shall—</P>
                            <P>(i) Require prime contractors to give full and fair consideration to qualified sources other than the prime contractor for the development or construction of major subsystems and components of major weapon systems;</P>
                            <P>(ii) Provide for Government surveillance of the process by which prime contractors consider such sources and determine whether to conduct such development or construction in-house or through a subcontract; and</P>
                            <P>(iii) Provide for the assessment of the extent to which the prime contractor has given full and fair consideration to qualified sources in sourcing decisions as a part of past performance evaluations.</P>
                            <P>(4) Whenever a source-of-repair decision results in a plan to award a contract for the performance of maintenance and sustainment services on a major weapon system, to the maximum extent practicable and consistent with statutory requirements, the acquisition plan shall prescribe that award will be made on a competitive basis after giving full consideration to all sources (including sources that partner or subcontract with public or private sector repair activities).</P>
                            <P>
                                (5) In accordance with 10 U.S.C. 4328, acquisition plans for engineering manufacturing and development and production of major systems as defined in 
                                <PRTPAGE P="56"/>
                                10 U.S.C. 3041(a) and 4202 and for major defense acquisition programs as defined in 202.101, shall include performance measures that are developed using best practices for responding to the positive or negative performance of a contractor for the engineering and manufacturing development or production of a weapon system, including embedded software. At a minimum the contracting officer shall—
                            </P>
                            <P>(i) Encourage the use of incentive fees and penalties as appropriate; and</P>
                            <P>(ii) Allow the program manager or comparable requiring activity official exercising program management responsibilities, to base determinations of a contractor's performance on reliability and maintainability data collected during the program. Such data collection and associated evaluation metrics shall be described in detail in the contract; and to the maximum extent practicable, the data shall be shared with appropriate contractor and Government organizations.</P>
                            <P>(S-73) In accordance with section 815 of the National Defense Authorization Act for Fiscal Year 2009 (Pub. L. 110-417) and DoD policy requirements, acquisition plans for major weapons systems shall include a plan for the preservation and storage of special tooling associated with the production of hardware for major defense acquisition programs through the end of the service life of the related weapons system. The plan shall include the identification of any contract clauses, facilities, and funding required for the preservation and storage of such tooling. The Under Secretary of Defense for Acquisition and Sustainment (USD(A&amp;S)) may waive this requirement if USD(A&amp;S) determines that it is in the best interest of DoD.</P>
                            <P>(S-74) When selecting contract type for a major defense acquisition program, see 234.004.</P>
                            <CITA>[56 FR 36305, July 31, 1991, as amended at 72 FR 51188, Sept. 6, 2007; 73 FR 1824, Jan. 10, 2008; 74 FR 68701, Dec. 29, 2009; 75 FR 8273, Feb. 24, 2010; 76 FR 11363, Mar. 2, 2011; 79 FR 4632, Jan. 29, 2014; 84 FR 58333, Oct. 31, 2019; 86 FR 27277, May 20, 2021; 87 FR 76990, Dec. 16, 2022; 88 FR 73236, Oct. 25, 2023; 89 FR 31657, Apr. 25, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>207.108</SECTNO>
                            <SUBJECT>Additional requirements for telecommuting.</SUBJECT>
                            <P>See PGI 207.108 for additional guidance concerning places of performance.</P>
                            <CITA>[87 FR 52339, Aug. 25, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>207.170</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>207.171</SECTNO>
                            <SUBJECT>Component breakout.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>207.171-1</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>(a) This section provides policy for breaking out components of end items for future acquisitions so that the Government can purchase the components directly from the manufacturer or supplier and furnish them to the end item manufacturer as Government-furnished material.</P>
                            <P>(b) This section does not apply to—</P>
                            <P>(1) The initial decisions on Government-furnished equipment or contractor-furnished equipment that are made at the inception of an acquisition program; or</P>
                            <P>(2) Breakout of parts for replenishment (see appendix E).</P>
                            <CITA>[71 FR 14102, Mar. 21, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>207.171-2</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <P>
                                <E T="03">Component,</E>
                                 as used in this section, includes subsystems, assemblies, subassemblies, and other major elements of an end item; it does not include elements of relatively small annual acquisition value.
                            </P>
                            <CITA>[71 FR 14102, Mar. 21, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>207.171-3</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>DoD policy is to break out components of weapons systems or other major end items under certain circumstances.</P>
                            <P>(a) When it is anticipated that a prime contract will be awarded without adequate price competition, and the prime contractor is expected to acquire any component without adequate price competition, the agency shall break out that component if—</P>
                            <P>(1) Substantial net cost savings probably will be achieved; and</P>
                            <P>(2) Breakout action will not jeopardize the quality, reliability, performance, or timely delivery of the end item.</P>
                            <P>
                                (b) Even when either or both the prime contract and the component will 
                                <PRTPAGE P="57"/>
                                be acquired with adequate price competition, the agency shall consider breakout of the component if substantial net cost savings will result from—
                            </P>
                            <P>(1) Greater quantity acquisitions; or</P>
                            <P>(2) Such factors as improved logistics support (through reduction in varieties of spare parts) and economies in operations and training (through standardization of design).</P>
                            <P>(c) Breakout normally is not justified for a component that is not expected to exceed $1 million for the current year's requirement.</P>
                            <CITA>[71 FR 14102, Mar. 21, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>207.171-4</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>Agencies shall follow the procedures at PGI 207.171-4 for component breakout.</P>
                            <CITA>[71 FR 14102, Mar. 21, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>207.172</SECTNO>
                            <SUBJECT>Human research.</SUBJECT>
                            <P>Any DoD component sponsoring research involving human subjects—</P>
                            <P>(a) Is responsible for oversight of compliance with 32 CFR Part 219, Protection of Human Subjects; and</P>
                            <P>(b) Must have a Human Research Protection Official, as defined in the clause at 252.235-7004, Protection of Human Subjects, and identified in the DoD component's Human Research Protection Management Plan. This official is responsible for the oversight and execution of the requirements of the clause at 252.235-7004 and shall be identified in acquisition planning.</P>
                            <CITA>[74 FR 37648, July 29, 2009]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 207.3—Contractor Versus Government Performance</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>81 FR 36473, June 7, 2016, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>207.302</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>See PGI 207.302 for information on the Governmentwide moratorium and restrictions on public-private competitions conducted pursuant to Office of Management and Budget (OMB) Circular A-76.</P>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 207.4—Equipment Acquisition</HD>
                        <SECTION>
                            <SECTNO>207.401</SECTNO>
                            <SUBJECT>Acquisition considerations.</SUBJECT>
                            <P>If the equipment will be leased for more than 60 days, the requiring activity must prepare and provide the contracting officer with the justification supporting the decision to lease or purchase.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>207.470</SECTNO>
                            <SUBJECT>Statutory requirements.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Requirement for authorization of certain contracts relating to vessels, aircraft, and combat vehicles.</E>
                                 The contracting officer shall not enter into any contract for the lease or charter of any vessel, aircraft, or combat vehicle, or any contract for services that would require the use of the contractor's vessel, aircraft, or combat vehicle, unless the Secretary of the military department concerned has satisfied the requirements of 10 U.S.C. 3671-3677, when—
                            </P>
                            <P>(1) The contract will be a long-term lease or charter as defined in 10 U.S.C. 3674(a)(1); or</P>
                            <P>(2) The terms of the contract provide for a substantial termination liability as defined in 10 U.S.C. 3674(b). Also see PGI 207.470.</P>
                            <P>
                                (b) 
                                <E T="03">Limitation on contracts with terms of 18 months or more.</E>
                                 As required by 10 U.S.C. 3678, the contracting officer shall not enter into any contract for any vessel, aircraft, or vehicle, through a lease, charter, or similar agreement with a term of 18 months or more, or extend or renew any such contract for a term of 18 months or more, unless the head of the contracting activity has—
                            </P>
                            <P>(1) Considered all costs of such a contract (including estimated termination liability); and</P>
                            <P>(2) Determined in writing that the contract is in the best interest of the Government.</P>
                            <P>
                                (c) 
                                <E T="03">Leasing of commercial vehicles and associated equipment.</E>
                                 Except as provided in paragraphs (a) and (b) of this section, the contracting officer may use leasing in the acquisition of commercial vehicles and associated equipment whenever the contracting officer 
                                <PRTPAGE P="58"/>
                                determines that leasing of such vehicles is practicable and efficient (10 U.S.C. 3681).
                            </P>
                            <CITA>[61 FR 16879, Apr. 18, 1996, as amended at 61 FR 50451, Sept. 26, 1996; 74 FR 34266, July 15, 2009; 87 FR 76990, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>207.471</SECTNO>
                            <SUBJECT>Funding requirements.</SUBJECT>
                            <P>(a) Fund leases in accordance with DoD Financial Management Regulation (FMR) 7000.14-R, Volume 2A, Chapter 1.</P>
                            <P>(b) DoD leases are either capital leases or operating leases. See FMR 7000.14-R, Volume 4, Chapter 6, section 060206.</P>
                            <P>(c) Use procurement funds for capital leases, as these are essentially installment purchases of property.</P>
                            <CITA>[64 FR 31732, June 14, 1999, as amended at 66 FR 55121, Nov. 1, 2001; 71 FR 53045, Sept. 8, 2006; 76 FR 76319, Dec. 7, 2011]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 207.5—Inherently Governmental Functions</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>70 FR 14573, Mar. 23, 2005, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>207.500</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>This subpart also implements 10 U.S.C. 4508.</P>
                            <CITA>[70 FR 14573, Mar. 23, 2005, as amended at 87 FR 76990, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>207.503</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(e) The written determination required by FAR 7.503(e), that none of the functions to be performed by contract are inherently governmental—</P>
                            <P>(i) Shall be prepared using DoD Instruction 1100.22, Guidance for Determining Workforce Mix; and</P>
                            <P>(ii) Shall include a determination that none of the functions to be performed are exempt from private sector performance, as addressed in DoD Instruction 1100.22.</P>
                            <P>
                                (S-70) 
                                <E T="03">Contracts for acquisition functions.</E>
                            </P>
                            <P>(1) In accordance with 10 U.S.C. 4508, the head of an agency may enter into a contract for performance of the acquisition functions closely associated with inherently governmental functions that are listed at FAR 7.503(d) only if—</P>
                            <P>(i) The contracting officer determines that appropriate military or civilian DoD personnel—</P>
                            <P>(A) Cannot reasonably be made available to perform the functions;</P>
                            <P>(B) Will oversee contractor performance of the contract; and</P>
                            <P>(C) Will perform all inherently governmental functions associated with the functions to be performed under the contract; and</P>
                            <P>(ii) The contracting officer ensures that the agency addresses any potential organizational conflict of interest of the contractor in the performance of the functions under the contract (see FAR Subpart 9.5).</P>
                            <P>(2) See related information at PGI 207.503(S-70).</P>
                            <CITA>[70 FR 14573, Mar. 23, 2005, as amended at 71 FR 14101, Mar. 21, 2006; 73 FR 1826, Jan. 10, 2008; 87 FR 76990, Dec. 16, 2022]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 207.70—Buy-to-Budget—Additional Quantities of End Items</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>68 FR 43331, July 22, 2003, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>207.7001</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <P>
                                <E T="03">End item,</E>
                                 as used in this subpart, means a production product assembled, completed, and ready for issue or deployment.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>207.7002</SECTNO>
                            <SUBJECT>Authority to acquire additional quantities of end items.</SUBJECT>
                            <P>10 U.S.C. 3069 authorizes DoD to use funds available for the acquisition of an end item to acquire a higher quantity of the end item than the quantity specified in a law providing for the funding of that acquisition, if the head of an agency determines that—</P>
                            <P>(a) The agency has an established requirement for the end item that is expected to remain substantially unchanged throughout the period of the acquisition;</P>
                            <P>(b) It is possible to acquire the higher quantity of the end item without additional funding because of production efficiencies or other cost reductions;</P>
                            <P>
                                (c) The amount of funds used for the acquisition of the higher quantity of the end item will not exceed the amount provided under that law for the acquisition of the end item; and
                                <PRTPAGE P="59"/>
                            </P>
                            <P>(d) The amount provided under that law for the acquisition of the end item is sufficient to ensure that each unit of the end item acquired within the higher quantity is fully funded as a complete end item.</P>
                            <CITA>[68 FR 43331, July 22, 2003, as amended at 87 FR 76990, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>207.7003</SECTNO>
                            <SUBJECT>Limitation.</SUBJECT>
                            <P>For noncompetitive acquisitions, the acquisition of additional quantities is limited to not more than 10 percent of the quantity approved in the justification and approval prepared in accordance with FAR part 6 for the acquisition of the end item.</P>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 208</EAR>
                    <HD SOURCE="HED">PART 208—REQUIRED SOURCES OF SUPPLIES AND SERVICES</HD>
                    <CONTENTS>
                        <SECHD>Sec.</SECHD>
                        <SECTNO>208.002</SECTNO>
                        <SUBJECT>Priorities for use of mandatory Government sources.</SUBJECT>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 208.4—Federal Supply Schedules</HD>
                            <SECTNO>208.404</SECTNO>
                            <SUBJECT>Use of Federal Supply Schedules.</SUBJECT>
                            <SECTNO>208.405</SECTNO>
                            <SUBJECT>Ordering procedures for Federal Supply Schedules.</SUBJECT>
                            <SECTNO>208.405-6</SECTNO>
                            <SUBJECT>Limiting sources.</SUBJECT>
                            <SECTNO>208.406</SECTNO>
                            <SUBJECT>Ordering activity responsibilities.</SUBJECT>
                            <SECTNO>208.406-1</SECTNO>
                            <SUBJECT>Order placement.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 208.6—Acquisition From Federal Prison Industries, Inc.</HD>
                            <SECTNO>208.602-70</SECTNO>
                            <SUBJECT>Acquisition of items for which FPI has a significant market share.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 208.7—Acquisition From Nonprofit Agencies Employing People Who Are Blind or Severely Disabled</HD>
                            <SECTNO>208.705</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 208.70—Coordinated Acquisition</HD>
                            <SECTNO>208.7000</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>208.7001</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>208.7002</SECTNO>
                            <SUBJECT>Assignment authority.</SUBJECT>
                            <SECTNO>208.7002-1</SECTNO>
                            <SUBJECT>Acquiring department responsibilities.</SUBJECT>
                            <SECTNO>208.7002-2</SECTNO>
                            <SUBJECT>Requiring department responsibilities.</SUBJECT>
                            <SECTNO>208.7003</SECTNO>
                            <SUBJECT>Applicability.</SUBJECT>
                            <SECTNO>208.7003-1</SECTNO>
                            <SUBJECT>Assignments under integrated materiel management (IMM).</SUBJECT>
                            <SECTNO>208.7003-2</SECTNO>
                            <SUBJECT>Assignments under coordinated acquisition.</SUBJECT>
                            <SECTNO>208.7004</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>208.7005</SECTNO>
                            <SUBJECT>Military interdepartmental purchase requests.</SUBJECT>
                            <SECTNO>208.7006</SECTNO>
                            <SUBJECT>Coordinated acquisition assignments.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 208.71—Acquisition for National Aeronautics and Space Administration (NASA)</HD>
                            <SECTNO>208.7100</SECTNO>
                            <SUBJECT>Authorization.</SUBJECT>
                            <SECTNO>208.7101</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>208.7102</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <RESERVED>Subpart 208.72 [Reserved]</RESERVED>
                            <SECTNO>208.7201</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>208.7202</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>208.7203</SECTNO>
                            <SUBJECT>Authority.</SUBJECT>
                            <SECTNO>208.7204</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 208.73—Use of Government-Owned Precious Metals</HD>
                            <SECTNO>208.7301</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>208.7302</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>208.7303</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>208.7304</SECTNO>
                            <SUBJECT>Refined precious metals.</SUBJECT>
                            <SECTNO>208.7305</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 208.74—Enterprise Software Agreements</HD>
                            <SECTNO>208.7400</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>208.7401</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>208.7402</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>208.7403</SECTNO>
                            <SUBJECT>Acquisition procedures.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36306, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SECTION>
                        <SECTNO>208.002</SECTNO>
                        <SUBJECT>Priorities for use of mandatory Government sources.</SUBJECT>
                        <P>
                            (a)(1) 
                            <E T="03">Supplies.</E>
                             (i) See the guidance at PGI 208.002(a)(1)(i) to obtain information on available items in DoD's property inventories.
                        </P>
                        <P>(v) See subpart 208.70, Coordinated Acquisition, and subpart 208.74, Enterprise Software Agreements.</P>
                        <CITA>[85 FR 34530, June 5, 2020]</CITA>
                    </SECTION>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 208.4—Federal Supply Schedules</HD>
                        <SECTION>
                            <SECTNO>208.404</SECTNO>
                            <SUBJECT>Use of Federal Supply Schedules.</SUBJECT>
                            <P>(a)(i) If only one offer is received in response to an order exceeding the simplified acquisition threshold that is placed on a competitive basis, the procedures at 215.371 apply.</P>
                            <P>
                                (ii) Departments and agencies shall comply with the review, approval, and 
                                <PRTPAGE P="60"/>
                                reporting requirements established in accordance with subpart 217.7 when placing orders for supplies or services in amounts exceeding the simplified acquisition threshold.
                            </P>
                            <P>(iii) When a schedule lists both foreign and domestic items that will meet the needs of the requiring activity, the ordering office must apply the procedures of part 225 and FAR part 25, Foreign Acquisition. When purchase of an item of foreign origin is specifically required, the requiring activity must furnish the ordering office sufficient information to permit the determinations required by part 225 and FAR part 25 to be made.</P>
                            <P>(iv) Use the provisions at 252.215-7007, Notice of Intent to Resolicit, and 252.215-7008, Only One Offer, as prescribed at 215.371-6 and 215.408(3), respectively.</P>
                            <CITA>[77 FR 39137, June 29, 2012, as amended at 78 FR 38235, June 26, 2013; 80 FR 67255, Oct. 30, 2015; 83 FR 30825, June 29, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>208.405</SECTNO>
                            <SUBJECT>Ordering procedures for Federal Supply Schedules.</SUBJECT>
                            <P>(1) Include an evaluation factor regarding supply chain risk (see subpart 239.73) when acquiring information technology, whether as a service or as a supply, that is a covered system, is a part of a covered system, or is in support of a covered system, as defined in 239.7301.</P>
                            <P>(2) See 215.101-2-70 for the limitations and prohibitions on the use of the lowest price technically acceptable source selection process, which are applicable to orders placed under Federal Supply Schedules.</P>
                            <P>(3) See 217.7801 for the prohibition on the use of reverse auctions for personal protective equipment and aviation critical safety items.</P>
                            <P>(4) See 204.7603 for procedures on the required use of the Supplier Performance Risk System (SPRS) risk assessments.</P>
                            <P>(i) The contracting officer shall ensure SPRS assessments of price risk and supplier risk are considered as a part of the award decision.</P>
                            <P>(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.</P>
                            <P>(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.</P>
                            <CITA>[80 FR 67251, Oct. 30, 2015, as amended at 84 FR 50788, Sept. 26, 2019; 88 FR 17338, Mar. 22, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>208.405-6</SECTNO>
                            <SUBJECT>Limiting sources.</SUBJECT>
                            <P>For an order or blanket purchase agreement (BPA) exceeding the simplified acquisition threshold that is a follow-on to an order or BPA for the same supply or service previously issued based on a limiting sources justification citing the authority at FAR 8.405-6(a)(1)(i)(B) or (C), follow the procedures at PGI 208.405-6.</P>
                            <CITA>[80 FR 21657, Apr. 20, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>§ 208.406</SECTNO>
                            <SUBJECT>Ordering activity responsibilities.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>§ 208.406-1</SECTNO>
                            <SUBJECT>Order placement.</SUBJECT>
                            <P>Follow the procedures at PGI 208.406-1 when ordering from schedules.</P>
                            <CITA>[71 FR 14107, Mar. 21, 2006]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 208.6—Acquisition From Federal Prison Industries, Inc.</HD>
                        <SECTION>
                            <SECTNO>208.602-70</SECTNO>
                            <SUBJECT>Acquisition of items for which FPI has a significant market share.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Scope.</E>
                                 This section implements 10 U.S.C. 3905.
                            </P>
                            <P>
                                (b) 
                                <E T="03">Definition. Item for which FPI has a significant market share</E>
                                , as used in this subsection, means an item for which FPI's share of the DoD market for the federal supply class including that item is greater than 5 percent, as determined by DoD in consultation with the Office of Federal Procurement Policy. A list of the federal supply classes of items for which FPI has a significant market share is maintained at 
                                <E T="03">https://www.acq.osd.mil/asda/dpc/cp/policy/other-policy-areas.html#fpi.</E>
                            </P>
                            <P>
                                (c) 
                                <E T="03">Policy.</E>
                                 (1) When acquiring an item for which FPI has a significant market share—
                                <PRTPAGE P="61"/>
                            </P>
                            <P>(i) Acquire the item using—</P>
                            <P>(A) Competitive procedures (e.g., the procedures in FAR 6.102, the set-aside procedures in FAR Subpart 19.5, or competition conducted in accordance with FAR Part 13); or</P>
                            <P>(B) The fair opportunity procedures in FAR 16.505, if placing an order under a multiple award delivery-order contract; and</P>
                            <P>(ii) Include FPI in the solicitation process, consider a timely offer from FPI, and make an award in accordance with the policy at FAR 8.602(a)(4)(ii) through (v).</P>
                            <P>(2) When acquiring an item for which FPI does not have a significant market share, acquire the item in accordance with the policy at FAR 8.602.</P>
                            <CITA>[73 FR 46817, Aug. 12, 2008, as amended at 87 FR 15817, Mar. 18, 2022; 87 FR 76990, Dec. 16, 2022]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 208.7—Acquisition From Nonprofit Agencies Employing People Who Are Blind or Severely Disabled</HD>
                        <SECTION>
                            <SECTNO>208.705</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>Follow the procedures at PGI 208.705 when placing orders with central nonprofit agencies.</P>
                            <CITA>[71 FR 39004, July 11, 2006]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 208.70—Coordinated Acquisition</HD>
                        <SECTION>
                            <SECTNO>208.7000</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>This subpart prescribes policy and procedures for acquisition of items for which contracting responsibility is assigned to one or more of the departments/agencies or the General Services Administration. Contracting responsibility is assigned through—</P>
                            <P>(a) The Coordinated Acquisition Program (commodity assignments are listed in PGI 208.7006); or</P>
                            <P>(b) The Integrated Materiel Management Program (assignments are in DoD 4140.26-M, Defense Integrated Materiel Management Manual for Consumable Items).</P>
                            <CITA>[56 FR 36306, July 31, 1991, as amended at 67 FR 77936, Dec. 20, 2002; 71 FR 39004, July 11, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>208.7001</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>For purposes of this subpart—</P>
                            <P>
                                <E T="03">Acquiring department</E>
                                 means the department, agency, or General Services Administration which has contracting responsibility under the Coordinated Acquisition Program.
                            </P>
                            <P>
                                <E T="03">Integrated materiel management</E>
                                 means assignment of acquisition management responsibility to one department, agency, or the General Services Administration for all of DoD's requirements for the assigned item. Acquisition management normally includes computing requirements, funding, budgeting, storing, issuing, cataloging, standardizing, and contracting functions.
                            </P>
                            <P>
                                <E T="03">Requiring department</E>
                                 means the department or agency which has the requirement for an item.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>208.7002</SECTNO>
                            <SUBJECT>Assignment authority.</SUBJECT>
                            <P>(a) Under the DoD Coordinated Acquisition Program, contracting responsibility for certain commodities is assigned to a single department, agency, or the General Services Administration (GSA). Commodity assignments are made—</P>
                            <P>(1) To the departments and agencies, by the Deputy Assistant Secretary of Defense (Logistics);</P>
                            <P>(2) To GSA, through agreement with GSA, by the Deputy Assistant Secretary of Defense (Logistics);</P>
                            <P>(3) Outside the contiguous United States, by the Unified Commanders; and</P>
                            <P>(4) For acquisitions to be made in the contiguous United States for commodities not assigned under paragraphs (a)(1), (2), or (3) of this section, by agreement of agency heads (10 U.S.C. 3065).</P>
                            <P>(i) Agreement may be on either a one-time or a continuing basis. The submission of a military interdepartmental purchase request (MIPR) by a requiring activity and its acceptance by the contracting activity of another department, even though based on an oral communication, constitutes a one-time agreement.</P>
                            <P>
                                (ii) Consider repetitive delegated acquisition responsibilities for coordinated acquisition assignment. If not 
                                <PRTPAGE P="62"/>
                                considered suitable for coordinated acquisition assignment, formalize continuing agreements and distribute them to all activities concerned.
                            </P>
                            <P>(b) Under the Integrated Materiel Management Program, assignments are made by the Deputy Assistant Secretary of Defense (Logistics)—</P>
                            <P>(1) To the departments and agencies; and</P>
                            <P>(2) To GSA, through agreement with GSA.</P>
                            <CITA>[56 FR 36306, July 31, 1991, as amended at 64 FR 51075, Sept. 21, 1999; 70 FR 35544, June 21, 2005; 87 FR 76990, Dec. 16, 2022; 88 FR 73236, Oct. 25, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>208.7002-1</SECTNO>
                            <SUBJECT>Acquiring department responsibilities.</SUBJECT>
                            <P>See PGI 208.7002-1 for the acquiring department's responsibilities.</P>
                            <CITA>[71 FR 39004, July 11, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>208.7002-2</SECTNO>
                            <SUBJECT>Requiring department responsibilities.</SUBJECT>
                            <P>See PGI 208.7002-2 for the requiring department's responsibilities.</P>
                            <CITA>[71 FR 39004, July 11, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>208.7003</SECTNO>
                            <SUBJECT>Applicability.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>208.7003-1</SECTNO>
                            <SUBJECT>Assignments under integrated materiel management (IMM).</SUBJECT>
                            <P>(a) Acquire all items assigned for IMM from the IMM manager except—</P>
                            <P>(1) Items purchased under circumstances of unusual and compelling urgency as defined in FAR 6.302-2. After such a purchase is made, the requiring activity must send one copy of the contract and a statement of the emergency to the IMM manager;</P>
                            <P>(2) Items for which the IMM manager assigns a supply system code for local purchase or otherwise grants authority to purchase locally; or</P>
                            <P>(3) When purchase by the requiring activity is in the best interest of the Government in terms of the combination of quality, timeliness, and cost that best meets the requirement. This exception does not apply to items—</P>
                            <P>(i) Critical to the safe operation of a weapon system;</P>
                            <P>(ii) With special security characteristics; or</P>
                            <P>(iii) Which are dangerous (e.g., explosives, munitions).</P>
                            <P>(b) Follow the procedures at PGI 208.7003-1(b) when an item assigned for IMM is to be acquired by the requiring department in accordance with paragraph (a)(3) of this subsection.</P>
                            <CITA>[60 FR 61593, Nov. 30, 1995, as amended at 64 FR 51075, Sept. 21, 1999; 64 FR 61031, Nov. 9, 1999; 71 FR 39004, July 11, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>208.7003-2</SECTNO>
                            <SUBJECT>Assignments under coordinated acquisition.</SUBJECT>
                            <P>Requiring departments must submit to the acquiring department all contracting requirements for items assigned for coordinated acquisition, except—</P>
                            <P>(a) Items obtained through the sources in FAR 8.002(a)(1) (i) through (vii);</P>
                            <P>(b) Items obtained under 208.7003-1(a);</P>
                            <P>(c) Requirements not in excess of the simplified acquisition threshold in FAR part 2, when contracting by the requiring department is in the best interest of the Government;</P>
                            <P>(d) In an emergency. When an emergency purchase is made, the requiring department must send one copy of the contract and a statement of the emergency to the contracting activity of the acquiring department;</P>
                            <P>(e) Requirements for which the acquiring department's contracting activity delegates contracting authority to the requiring department;</P>
                            <P>(f) Items in a research and development stage (as described in FAR part 35). Under this exception, the military departments may contract for research and development requirements, including quantities for testing purposes and items undergoing in-service evaluation (not yet in actual production, but beyond prototype). Generally, this exception applies only when research and development funds are used.</P>
                            <P>(g) Items peculiar to nuclear ordnance material where design characteristics or test-inspection requirements are controlled by the Department of Energy (DoE) or by DoD to ensure reliability of nuclear weapons.</P>
                            <P>
                                (1) This exception applies to all items designed for and peculiar to nuclear ordnance regardless of agency control, or to any item which requires test or inspection conducted or controlled by DoE or DoD.
                                <PRTPAGE P="63"/>
                            </P>
                            <P>(2) This exception does not cover items used for both nuclear ordnance and other purposes if the items are not subject to the special testing procedures.</P>
                            <P>(h) Items to be acquired under FAR 6.302-6 (national security requires limitation of sources);</P>
                            <P>(i) Items to be acquired under FAR 6.302-1 (supplies available only from the original source for follow-on contract);</P>
                            <P>(j) Items directly related to a major system and which are design controlled by and acquired from either the system manufacturer or a manufacturer of a major subsystem;</P>
                            <P>(k) Items subject to rapid design changes, or to continuous redesign or modification during the production and/or operational use phases, which require continual contact between industry and the requiring department to ensure that the item meets the requirements:</P>
                            <P>(1) This exception permits the requiring department to contract for items of highly unstable design. For use of this exception, it must be clearly impractical, both technically and contractually, to refer the acquisition to the acquiring department. Anticipation that contracting by negotiation will be appropriate, or that a number of design changes may occur during contract performance is not in itself sufficient reason for using this exception.</P>
                            <P>(2) This exception also applies to items requiring compatibility testing, provided such testing requires continual contact between industry and the requiring department;</P>
                            <P>(l) Containers acquired only with items for which they are designed;</P>
                            <P>(m) One-time buy of a noncataloged item.</P>
                            <P>(1) This exception permits the requiring departments to contract for a nonrecurring requirement for a noncataloged item. This exception could cover a part or component for a prototype which may be stock numbered at a later date.</P>
                            <P>(2) This exception does not permit acquisitions of recurring requirements for an item, based solely on the fact that the item is not stock numbered, nor may it be used to acquire items which have only slightly different characteristics than previously cataloged items.</P>
                            <CITA>[56 FR 36306, July 31, 1991, as amended at 60 FR 61593, Nov. 30, 1995; 64 FR 51075, Sept. 21, 1999; 71 FR 69489, Dec. 1, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>208.7004</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>Follow the procedures at PGI 208.7004 for processing coordinated acquisition requirements.</P>
                            <CITA>[71 FR 39005, July 11, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>208.7005</SECTNO>
                            <SUBJECT>Military interdepartmental purchase requests.</SUBJECT>
                            <P>Follow the procedures at—</P>
                            <P>(a) PGI 253.208-1 when using DD Form 448, Military Interdepartmental Purchase Request; and</P>
                            <P>(b) PGI 253.208-2 when using DD Form 448-2, Acceptance of MIPR.</P>
                            <CITA>[71 FR 39005, July 11, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>208.7006</SECTNO>
                            <SUBJECT>Coordinated acquisition assignments.</SUBJECT>
                            <P>See PGI 208.7006 for coordinated acquisition assignments.</P>
                            <CITA>[71 FR 39005, July 11, 2006]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 208.71—Acquisition for National Aeronautics and Space Administration (NASA)</HD>
                        <SECTION>
                            <SECTNO>208.7100</SECTNO>
                            <SUBJECT>Authorization.</SUBJECT>
                            <P>NASA is authorized by Public Law 85-568 to use the acquisition services, personnel, equipment, and facilities of DoD departments and agencies with their consent, with or without reimbursement, and on a similar basis to cooperate with the departments/agencies in the use of acquisition services, equipment, and facilities.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>208.7101</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>Departments and agencies shall cooperate fully with NASA in making acquisition services, equipment, personnel, and facilities available on the basis of mutual agreement.</P>
                            <CITA>[71 FR 39005, July 11, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>208.7102</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>Follow the procedures at PGI 208.7102 when contracting or performing services for NASA.</P>
                            <CITA>[71 FR 39005, July 11, 2006]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <PRTPAGE P="64"/>
                        <RESERVED>Subpart 208.72 [Reserved]</RESERVED>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 208.73—Use of Government-Owned Precious Metals</HD>
                        <SECTION>
                            <SECTNO>208.7301</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this subpart—</P>
                            <P>
                                <E T="03">Defense Supply Center, Philadelphia (DSCP)</E>
                                 means the Defense Logistics Agency field activity located at 700 Robbins Avenue, Philadelphia, PA 19111-5096, which is the assigned commodity integrated material manager for refined precious metals and is responsible for the storage and issue of such material.
                            </P>
                            <P>
                                <E T="03">Refined precious metal</E>
                                 means recovered silver, gold, platinum, palladium, iridium, rhodium, or ruthenium, in bullion, granulation or sponge form, which has been purified to at least .999 percentage of fineness.
                            </P>
                            <CITA>[56 FR 36306, July 31, 1991, as amended at 65 FR 14398, Mar. 16, 2000; 65 FR 52951, Aug. 31, 2000; 65 FR 58607 Sept. 29, 2000; 71 FR 39005, July 11, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>208.7302</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>DoD policy is for maximum participation in the Precious Metals Recovery Program. DoD components shall furnish recovered precious metals contained in the DSCP inventory to production contractors rather than use contractor-furnished precious metals whenever the contracting officer determines it to be in the Government's best interest.</P>
                            <CITA>[56 FR 36306, July 31, 1991, as amended at 65 FR 52951, Aug. 31, 2000; 71 FR 39005, July 11, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>208.7303</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>Follow the procedures at PGI 208.7303 for use of the Precious Metals Recovery Program.</P>
                            <CITA>[71 FR 39005, July 11, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>208.7304</SECTNO>
                            <SUBJECT>Refined precious metals.</SUBJECT>
                            <P>See PGI 208.7304 for a list of refined precious metals managed by DSCP.</P>
                            <CITA>[71 FR 39005, July 11, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>208.7305</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>(a) Use the clause at 252.208-7000, Intent to Furnish Precious Metals as Government-Furnished Material, in all solicitations and contracts except—</P>
                            <P>(1) When the contracting officer has determined that the required precious metals are not available from DSCP;</P>
                            <P>(2) When the contracting officer knows that the items being acquired do not require precious metals in their manufacture; or</P>
                            <P>(3) For acquisitions at or below the simplified acquisition threshold.</P>
                            <P>(b) To make the determination in paragraph (a)(1) of this section, the contracting officer shall consult with the end item inventory manager and comply with the procedures in Chapter 11, DoD 4160.21-M, Defense Materiel Disposition Manual.</P>
                            <CITA>[56 FR 36306, July 31, 1991, as amended at 64 FR 2596, Jan. 15, 1999; 65 FR 14398, Mar. 16, 2000; 65 FR 52952, Aug. 31, 2000]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 208.74—Enterprise Software Agreements</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>67 FR 65511, Oct. 25, 2002, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>208.7400</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>This subpart prescribes policy and procedures for acquisition of commercial software and software maintenance, including software and software maintenance that is acquired—</P>
                            <P>(a) As part of a system or system upgrade, where practicable;</P>
                            <P>(b) Under a service contract;</P>
                            <P>
                                (c) Under a contract or agreement administered by another agency (
                                <E T="03">e.g.,</E>
                                 under an interagency agreement);
                            </P>
                            <P>(d) Under a Federal Supply Schedule contract or blanket purchase agreement established in accordance with FAR 8.405; or</P>
                            <P>(e) By a contractor that is authorized to order From a Government supply source pursuant to FAR 51.101.</P>
                            <CITA>[67 FR 65511, Oct. 25, 2002, as amended at 71 FR 62559, Oct. 26, 2006; 78 FR 38235, June 26, 2013]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>208.7401</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this subpart—</P>
                            <P>
                                <E T="03">Enterprise software agreement</E>
                                 means an agreement or a contract that is used to acquire designated commercial software or related commercial software services such as software maintenance.
                                <PRTPAGE P="65"/>
                            </P>
                            <P>
                                <E T="03">Enterprise Software Initiative</E>
                                 means an initiative led by the DoD Chief Information Officer to develop processes for DoD-wide software asset management.
                            </P>
                            <P>
                                <E T="03">Software maintenance</E>
                                 means services normally provided by a software company as standard services at established catalog or market prices, 
                                <E T="03">e.g.,</E>
                                 the right to receive and use upgraded versions of software, updates, and revisions.
                            </P>
                            <CITA>[67 FR 65511, Oct. 25, 2002, as amended at 71 FR 39005, July 11, 2006; 88 FR 6581, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>208.7402</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>
                                (a) Departments and agencies shall fulfill requirements for commercial software and commercial software services, such as software maintenance, in accordance with the DoD Enterprise Software Initiative (ESI) (see 
                                <E T="03">https://www.esi.mil/).</E>
                                 ESI promotes the use of enterprise software agreements (ESAs) with contractors that allow DoD to obtain favorable terms and pricing for commercial software and related services. ESI does not dictate the products or services to be acquired.
                            </P>
                            <P>(b) Include an evaluation factor regarding supply chain risk (see subpart 239.73) when acquiring information technology, whether as a service or as a supply, that is a covered system, is a part of a covered system, or is in support of a covered system, as defined in 239.7301.</P>
                            <CITA>[67 FR 65511, Oct. 25, 2002, as amended at 78 FR 69270, Nov. 18, 2013; 80 FR 67251, Oct. 30, 2015; 88 FR 6581, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>208.7403</SECTNO>
                            <SUBJECT>Acquisition procedures.</SUBJECT>
                            <P>Follow the procedures at PGI 208.7403 when acquiring commercial software and commercial software services.</P>
                            <CITA>[71 FR 39005, July 11, 2006, as amended at 88 FR 6581, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 209</EAR>
                    <HD SOURCE="HED">PART 209—CONTRACTOR QUALIFICATIONS</HD>
                    <CONTENTS>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 209.1—Responsible Prospective Contractors</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>209.101</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>209.104</SECTNO>
                            <SUBJECT>Standards.</SUBJECT>
                            <SECTNO>209.104-1</SECTNO>
                            <SUBJECT>General standards.</SUBJECT>
                            <SECTNO>209.104-4</SECTNO>
                            <SUBJECT>Subcontractor responsibility.</SUBJECT>
                            <SECTNO>209.104-70</SECTNO>
                            <SUBJECT>Solicitation provision.</SUBJECT>
                            <SECTNO>209.105</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>209.105-1</SECTNO>
                            <SUBJECT>Obtaining information.</SUBJECT>
                            <SECTNO>209.105-2</SECTNO>
                            <SUBJECT>Determinations and documentation.</SUBJECT>
                            <SECTNO>209.105-2-70</SECTNO>
                            <SUBJECT>Inclusion of determination of contractor fault in Federal Awardee Performance and Integrity Information System (FAPIIS).</SUBJECT>
                            <SECTNO>209.106</SECTNO>
                            <SUBJECT>Preaward surveys.</SUBJECT>
                            <SECTNO>209.170</SECTNO>
                            <SUBJECT>Restriction on the use of certain institutions of higher education.</SUBJECT>
                            <SECTNO>209.170-0</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>209.170-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>209.170-2</SECTNO>
                            <SUBJECT>Restriction.</SUBJECT>
                            <SECTNO>209.170-3</SECTNO>
                            <SUBJECT>Waiver of restriction.</SUBJECT>
                            <SECTNO>209.170-4</SECTNO>
                            <SUBJECT>Solicitation provision.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 209.2—Qualifications Requirements</HD>
                            <SECTNO>209.202</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>209.270</SECTNO>
                            <SUBJECT>Aviation critical safety items.</SUBJECT>
                            <SECTNO>209.270-1</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>209.270-2</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>209.270-3</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>209.270-4</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>209.270-5</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <RESERVED>Subpart 209.3 [Reserved]</RESERVED>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 209.4—Debarment, Suspension, and Ineligibility</HD>
                            <SECTNO>209.402</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>209.403</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>209.405</SECTNO>
                            <SUBJECT>Effect of listing.</SUBJECT>
                            <SECTNO>209.405-2</SECTNO>
                            <SUBJECT>Restrictions on subcontracting.</SUBJECT>
                            <SECTNO>209.406</SECTNO>
                            <SUBJECT>Debarment.</SUBJECT>
                            <SECTNO>209.406-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>209.406-2</SECTNO>
                            <SUBJECT>Causes for debarment.</SUBJECT>
                            <SECTNO>209.406-3</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>209.407</SECTNO>
                            <SUBJECT>Suspension.</SUBJECT>
                            <SECTNO>209.407-3</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>209.409</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <RESERVED>Subpart 209.470 [Reserved]</RESERVED>
                            <SECTNO>209.471</SECTNO>
                            <SUBJECT>Congressional Medal of Honor.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 209.5—Organizational and Consultant Conflicts of Interest</HD>
                            <SECTNO>209.505</SECTNO>
                            <SUBJECT>General rules.</SUBJECT>
                            <SECTNO>209.505-4</SECTNO>
                            <SUBJECT>Obtaining access to proprietary information.</SUBJECT>
                            <SECTNO>209.570</SECTNO>
                            <SUBJECT>Limitations on contractors acting as lead system integrators.</SUBJECT>
                            <SECTNO>209.570-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>209.570-2</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>209.570-3</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>209.570-4</SECTNO>
                            <SUBJECT>Solicitation provision and contract clause.</SUBJECT>
                            <SECTNO>209.571</SECTNO>
                            <SUBJECT>Organizational conflicts of interest in major defense acquisition programs.</SUBJECT>
                            <SECTNO>209.571-0</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>209.571-1</SECTNO>
                            <SUBJECT>
                                Definitions.
                                <PRTPAGE P="66"/>
                            </SUBJECT>
                            <SECTNO>209.571-2</SECTNO>
                            <SUBJECT>Applicability.</SUBJECT>
                            <SECTNO>209.571-4</SECTNO>
                            <SUBJECT>Mitigation.</SUBJECT>
                            <SECTNO>209.571-5</SECTNO>
                            <SUBJECT>Lead system integrators.</SUBJECT>
                            <SECTNO>209.571-6</SECTNO>
                            <SUBJECT>Identification of organizational conflicts of interest.</SUBJECT>
                            <SECTNO>209.571-7</SECTNO>
                            <SUBJECT>Systems engineering and technical assistance contracts.</SUBJECT>
                            <SECTNO>209.571-8</SECTNO>
                            <SUBJECT>Solicitation provision and contract clause.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36313, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 209.1—Responsible Prospective Contractors</HD>
                        <SECTION>
                            <SECTNO>209.101</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>“Entity controlled by a foreign government,” “foreign government,” and “proscribed information,” are defined in the provision at 252.209-7002, Disclosure of Ownership or Control by a Foreign Government.</P>
                            <CITA>[59 FR 51132, Oct. 7, 1994]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.104</SECTNO>
                            <SUBJECT>Standards.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.104-1</SECTNO>
                            <SUBJECT>General standards.</SUBJECT>
                            <P>(e) For cost-reimbursement or incentive type contracts, or contracts which provide for progress payments based on costs or on a percentage or stage of completion, the prospective contractor's accounting system and related internal controls must provide reasonable assurance that—</P>
                            <P>(i) Applicable laws and regulations are complied with;</P>
                            <P>(ii) The accounting system and cost data are reliable;</P>
                            <P>(iii) Risk of misallocations and mischarges are minimized; and</P>
                            <P>(iv) Contract allocations and charges are consistent with invoice procedures.</P>
                            <P>
                                (g)(i) 
                                <E T="03">Ownership or control by the government of a country that is a state sponsor of terrorism.</E>
                                 See 225.771.
                            </P>
                            <P>
                                (ii) 
                                <E T="03">Ownership or control by a foreign government when access to proscribed information is required to perform the contract.</E>
                                 (A) Under 10 U.S.C. 4874(a), no DoD contract under a national security program may be awarded to an entity controlled by a foreign government if that entity requires access to proscribed information to perform the contract.
                            </P>
                            <P>(B) Whenever the contracting officer has a question about application of the provision at 252.209-7002, the contracting officer may seek advice from the Security Directorate, Office of the Deputy Under Secretary of Defense, Human Intelligence, Counterintelligence, and Security.</P>
                            <P>(C) In accordance with 10 U.S.C. 4874(b)(1)(A), the Secretary of Defense may waive the prohibition in paragraph (g)(ii)(A) of this section upon determining that the waiver is essential to the national security interests of the United States. The Secretary has delegated authority to grant this waiver to the Under Secretary of Defense for Intelligence. Waiver requests, prepared by the requiring activity in coordination with the contracting officer, shall be processed through the Principal Director, Defense Pricing, Contracting, and Acquisition Policy, Office of the Under Secretary of Defense (Acquisition and Sustainment), and shall include a proposed national interest determination. The proposed national interest determination, prepared by the requiring activity in coordination with the contracting officer, shall include—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Identification of the proposed awardee, with a synopsis of its foreign ownership (include solicitation and other reference numbers to identify the action);
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) General description of the acquisition and performance requirements;
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) Identification of the national security interests involved and the ways award of the contract helps advance those interests;
                            </P>
                            <P>
                                (
                                <E T="03">4</E>
                                ) The availability of another entity with the capacity, capability and technical expertise to satisfy defense acquisition, technology base, or industrial base requirements; and
                            </P>
                            <P>
                                (
                                <E T="03">5</E>
                                ) A description of any alternate means available to satisfy the requirement, e.g., use of substitute products or technology or alternate approaches to accomplish the program objectives.
                            </P>
                            <P>(D) In accordance with 10 U.S.C. 4874(b)(1)(B), the Secretary of Defense may, in the case of a contract awarded for environmental restoration, remediation, or waste management at a DoD facility, waive the prohibition in paragraph (g)(ii)(A) of this section upon—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Determining that—
                                <PRTPAGE P="67"/>
                            </P>
                            <P>
                                (
                                <E T="03">i</E>
                                ) The waiver will advance the environmental restoration, remediation, or waste management objectives of DoD and will not harm the national security interests of the United States; and
                            </P>
                            <P>
                                (
                                <E T="03">ii</E>
                                ) The entity to which the contract is awarded is controlled by a foreign government with which the Secretary is authorized to exchange Restricted Data under section 144c. of the Atomic Energy Act of 1954 (42 U.S.C. 2164(c)); and
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Notifying Congress of the decision to grant the waiver. The contract may be awarded only after the end of the 45-day period beginning on the date the notification is received by the appropriate Congressional committees.
                            </P>
                            <CITA>[58 FR 28464, May 13, 1993, as amended at 59 FR 51131, 51132, Oct. 7, 1994; 60 FR 29497, June 5, 1995; 62 FR 34121, June 24, 1997; 63 FR 11851, Mar. 11, 1998; 63 FR 14837, Mar. 27, 1998; 65 FR 39704, June 27, 2000; 67 FR 4208, Jan. 29, 2002; 68 FR 7439, Feb. 14, 2003; 74 FR 2413, Jan. 15, 2009; 75 FR 35685, June 23, 2010; 75 FR 45073, Aug. 2, 2010; 79 FR 73489, Dec. 11, 2014; 87 FR 15817, Mar. 18, 2022; 87 FR 76990, Dec. 16, 2022; 89 FR 60831, July 29, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.104-4</SECTNO>
                            <SUBJECT>Subcontractor responsibility.</SUBJECT>
                            <P>Generally, the Canadian Commercial Corporation's (CCC) proposal of a firm as its subcontractor is sufficient basis for an affirmative determination of responsibility. However, when the CCC determination of responsibility is not consistent with other information available to the contracting officer, the contracting officer shall request from CCC and any other sources whatever additional information is necessary to make the responsibility determination.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.104-70</SECTNO>
                            <SUBJECT>Solicitation provision.</SUBJECT>
                            <P>Use the provision at 252.209-7002, Disclosure of Ownership or Control by a Foreign Government, in all solicitations, including those subject to the procedures in FAR part 13, when access to proscribed information is necessary for contract performance. If the solicitation includes the provision at FAR 52.204-7, do not separately list the provision 252.209-7002 in the solicitation.</P>
                            <CITA>[79 FR 73489, Dec. 11, 2014]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.105</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.105-1</SECTNO>
                            <SUBJECT>Obtaining information.</SUBJECT>
                            <P>(1) For guidance on using the Exclusions section of the System for Award Management, see PGI 209.105-1.</P>
                            <P>(2) A satisfactory performance record is a factor in determining contractor responsibility (see FAR 9.104-1(c)).</P>
                            <P>
                                (i) One source of information relating to contractor performance is the Contractor Performance Assessment Reporting System (CPARS), available at 
                                <E T="03">https://www.cpars.gov/.</E>
                            </P>
                            <P>
                                (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 
                                <E T="03">https://sam.gov</E>
                                 (see FAR subpart 42.15). This termination information is just one consideration in determining contractor responsibility.
                            </P>
                            <P>
                                (iii) Contracting officers shall consider the supplier risk assessment available in the Supplier Performance Risk System at 
                                <E T="03">https://piee.eb.mil/</E>
                                 when determining responsibility. See 204.7603(c).
                            </P>
                            <CITA>[74 FR 2415, Jan. 15, 2009, as amended at 76 FR 76319, Dec. 7, 2011; 78 FR 28757, May 16, 2013; 79 FR 17445, Mar. 28, 2014; 84 FR 48508, Sept. 13, 2019; 88 FR 17339, Mar. 22, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.105-2</SECTNO>
                            <SUBJECT>Determinations and documentation.</SUBJECT>
                            <P>(a) The contracting officer shall submit a copy of a determination of nonresponsibility to the appropriate debarring and suspending official listed in 209.403.</P>
                            <CITA>[71 FR 62559, Oct. 26, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.105-2-70</SECTNO>
                            <SUBJECT>Inclusion of determination of contractor fault in Federal Awardee Performance and Integrity Information System (FAPIIS).</SUBJECT>
                            <P>
                                If the contractor or a subcontractor at any tier is not subject to the jurisdiction of the U.S. courts and the DoD appointing official that requested a DoD investigation makes a final determination that a contractor's or subcontractor's gross negligence or reckless disregard for the safety of civilian or military personnel of the Government caused serious bodily injury or 
                                <PRTPAGE P="68"/>
                                death of such personnel, the contracting officer shall enter in FAPIIS the appropriate information regarding such determination within three days of receiving notice of the determination, pursuant to section 834 of the National Defense Authorization Act for Fiscal Year 2011 (Pub. L. 111-383). Information posted in FAPIIS regarding such determinations will be publicly available.
                            </P>
                            <CITA>[76 FR 57677, Sept. 16, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.106</SECTNO>
                            <SUBJECT>Preaward surveys.</SUBJECT>
                            <P>When requesting a preaward survey, follow the procedures at PGI 209.106.</P>
                            <CITA>[69 FR 65089, Nov. 10, 2004, as amended at 88 FR 67609, Sept. 29, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.170</SECTNO>
                            <SUBJECT>Restriction on the use of certain institutions of higher education.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.170-0</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>This section implements section 1062 of the National Defense Authorization Act for Fiscal Year 2021 (Pub. L. 116-283).</P>
                            <CITA>[88 FR 67609, Sept. 29, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.170-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this section—</P>
                            <P>
                                <E T="03">Confucius Institute</E>
                                 means a cultural institute directly or indirectly funded by the government of the People's Republic of China.
                            </P>
                            <P>
                                <E T="03">Institution of higher education</E>
                                 has the meaning given in 20 U.S.C. 1002.
                            </P>
                            <CITA>[88 FR 67609, Sept. 29, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.170-2</SECTNO>
                            <SUBJECT>Restriction.</SUBJECT>
                            <P>None of the funds authorized to be appropriated or otherwise made available for any fiscal year for DoD may be used to contract with an institution of higher education that hosts a Confucius Institute, other than amounts provided directly to students as educational assistance. Contracting officers shall not enter into a contract with any institution of higher education that hosts a Confucius Institute, unless a waiver has been granted.</P>
                            <CITA>[88 FR 67609, Sept. 29, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.170-3</SECTNO>
                            <SUBJECT>Waiver of restriction.</SUBJECT>
                            <P>The restriction in 209.170-2 can be waived by the Office of the Under Secretary of Defense (Research and Engineering), without power of delegation, in accordance with the Confucius Institute Waiver Program guidance. See PGI 209.170-4.</P>
                            <CITA>[88 FR 67609, Sept. 29, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.170-4</SECTNO>
                            <SUBJECT>Solicitation provision.</SUBJECT>
                            <P>Use the provision at 252.209-7011, Representation for Restriction on the Use of Certain Institutions of Higher Education, in solicitations, including solicitations using FAR part 12 procedures for the acquisition of commercial products and commercial services, for acquisitions to an institution of higher education.</P>
                            <CITA>[88 FR 67609, Sept. 29, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 209.2—Qualifications Requirements</HD>
                        <SECTION>
                            <SECTNO>209.202</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(a)(1) Except for aviation or ship critical safety items, obtain approval in accordance with PGI 209.202(a)(1) when establishing qualification requirements. See 209.270 for approval of qualification requirements for aviation or ship critical safety items.</P>
                            <CITA>[73 FR 1827, Jan. 10, 2008]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.270</SECTNO>
                            <SUBJECT>Aviation and ship critical safety items.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.270-1</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>This section—</P>
                            <P>(a) Implements—</P>
                            <P>(1) Section 802 of the National Defense Authorization Act for Fiscal Year 2004 (Pub. L. 108-136); and</P>
                            <P>(2) Section 130 of the National Defense Authorization Act for Fiscal Year 2007 (Pub. L. 109-364); and</P>
                            <P>(b) Prescribes policy and procedures for qualification requirements in the procurement of aviation and ship critical safety items and the modification, repair, and overhaul of those items.</P>
                            <CITA>[73 FR 1827, Jan. 10, 2008]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.270-2</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>
                                As used in this section—
                                <PRTPAGE P="69"/>
                            </P>
                            <P>
                                <E T="03">Aviation critical safety item</E>
                                 means a part, an assembly, installation equipment, launch equipment, recovery equipment, or support equipment for an aircraft or aviation weapon system if the part, assembly, or equipment contains a characteristic any failure, malfunction, or absence of which could cause—
                            </P>
                            <P>(1) A catastrophic or critical failure resulting in the loss of or serious damage to the aircraft or weapon system;</P>
                            <P>(2) An unacceptable risk of personal injury or loss of life; or</P>
                            <P>(3) An uncommanded engine shutdown that jeopardizes safety.</P>
                            <P>
                                <E T="03">Design control activity</E>
                                —(1) With respect to an aviation critical safety item, means the systems command of a military department that is specifically responsible for ensuring the air worthiness of an aviation system or equipment in which an aviation critical safety item is to be used; and
                            </P>
                            <P>(2) With respect to a ship critical safety item, means the systems command of a military department that is specifically responsible for ensuring the seaworthiness of a ship or ship equipment in which a ship critical safety item is to be used.</P>
                            <P>
                                <E T="03">Ship critical safety item</E>
                                 means any ship part, assembly, or support equipment containing a characteristic the failure, malfunction, or absence of which could cause—
                            </P>
                            <P>(1) A catastrophic or critical failure resulting in loss of or serious damage to the ship; or</P>
                            <P>(2) An unacceptable risk of personal injury or loss of life.</P>
                            <CITA>[69 FR 55988, Sept. 17, 2004, as amended at 73 FR 1827, Jan. 10, 2008]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.270-3</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(a) The head of the contracting activity responsible for procuring an aviation or ship critical safety item may enter into a contract for the procurement, modification, repair, or overhaul of such an item only with a source approved by the head of the design control activity.</P>
                            <P>(b) The approval authorities specified in this section apply instead of those otherwise specified in FAR 9.202(a)(1), 9.202(c), or 9.206-1(c), for the procurement, modification, repair, and overhaul of aviation or ship critical safety items.</P>
                            <CITA>[73 FR 1827, Jan. 10, 2008]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.270-4</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>(a) The head of the design control activity shall—</P>
                            <P>(1) Identify items that meet the criteria for designation as aviation or ship critical safety items. See additional information at PGI 209.270-4;</P>
                            <P>(2) Approve qualification requirements in accordance with procedures established by the design control activity; and</P>
                            <P>(3) Qualify and identify aviation and ship critical safety item suppliers and products.</P>
                            <P>(b) The contracting officer shall—</P>
                            <P>(1) Ensure that the head of the design control activity has determined that a prospective contractor or its product meets or can meet the established qualification standards before the date specified for award of the contract;</P>
                            <P>(2) Refer any offers received from an unapproved source to the head of the design control activity for approval. The head of the design control activity will determine whether the offeror or its product meets or can meet the established qualification standards before the date specified for award of the contract; and</P>
                            <P>(3) Refer any requests for qualification to the design control activity.</P>
                            <P>(c) See 246.407 (S-70) and 246.504 for quality assurance requirements.</P>
                            <CITA>[69 FR 55988, Sept. 17, 2004, as amended at 70 FR 57190, Sept. 30, 2005; 73 FR 1827, Jan. 10, 2008]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.270-5</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>The contracting officer shall insert the clause at 252.209-7010, Critical Safety Items, in solicitations and contracts when the acquisition includes one or more items designated by the design control activity as critical safety items.</P>
                            <CITA>[76 FR 52139, Aug. 19, 2011]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <RESERVED>Subpart 209.3 [Reserved]</RESERVED>
                    </SUBPART>
                    <SUBPART>
                        <PRTPAGE P="70"/>
                        <HD SOURCE="HED">Subpart 209.4—Debarment, Suspension, and Ineligibility</HD>
                        <SECTION>
                            <SECTNO>209.402</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(d) The uniform suspension and debarment procedures to be followed by all debarring and suspending officials are set out in appendix H to this chapter.</P>
                            <P>(e) The department or agency shall provide a copy of the Debarment and Suspension Procedures at DFARS appendix H to this chapter to contractors at the time of their suspension or when they are proposed for debarment, and upon request to other interested parties.</P>
                            <CITA>[59 FR 27668, May 27, 1994]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.403</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>
                                <E T="03">Debarring and suspending official.</E>
                                 (1) For DoD, the designees are—
                            </P>
                            <EXTRACT>
                                <FP SOURCE="FP-1">(i) Army—Director, Soldier &amp; Family Legal Services.</FP>
                                <FP SOURCE="FP-1">(ii) Navy/Marine Corps—The Assistant General Counsel (Acquisition Integrity).</FP>
                                <FP SOURCE="FP-1">(iii) Air Force—Deputy General Counsel (Contractor Responsibility).</FP>
                                <FP SOURCE="FP-1">(iv) Defense Advanced Research Projects Agency—The Director.</FP>
                                <FP SOURCE="FP-1">(v) Defense Health Agency—The Principal Deputy General Counsel.</FP>
                                <FP SOURCE="FP-1">(vi) Defense Information Systems Agency—The General Counsel.</FP>
                                <FP SOURCE="FP-1">(vii) Defense Intelligence Agency—The Senior Procurement Executive.</FP>
                                <FP SOURCE="FP-1">(viii) Defense Logistics Agency—The Special Assistant for Contracting Integrity.</FP>
                                <FP SOURCE="FP-1">(ix) Defense Threat Reduction Agency—The Director.</FP>
                                <FP SOURCE="FP-1">(x) Missile Defense Agency—The General Counsel.</FP>
                                <FP SOURCE="FP-1">(xi) National Geospatial-Intelligence Agency—The General Counsel.</FP>
                                <FP SOURCE="FP-1">(xii) National Security Agency—The Senior Acquisition Executive.</FP>
                                <FP SOURCE="FP-1">(xiii) United States Cyber Command—The Staff Judge Advocate.</FP>
                                <FP SOURCE="FP-1">(xiv) Overseas installations—as designated by the agency head.</FP>
                            </EXTRACT>
                            <P>(2) Overseas debarring and suspending officials—</P>
                            <P>(i) Are authorized to debar or suspend contractors located within the official's geographic area of responsibility under any delegation of authority they receive from their agency head.</P>
                            <P>(ii) Debar or suspend in accordance with the procedures in FAR subpart 9.4 or under modified procedures approved by the agency head based on consideration of the laws or customs of the foreign countries concerned.</P>
                            <P>(iii) In addition to the bases for debarment in FAR 9.406-2, may consider the following additional bases—</P>
                            <P>(A) The foreign country concerned determines that a contractor has engaged in bid-rigging, price-fixing, or other anti-competitive behavior; or</P>
                            <P>(B) The foreign country concerned declares the contractor to be formally debarred, suspended, or otherwise ineligible to contract with that foreign government or its instrumentalities.</P>
                            <P>(3) The Defense Logistics Agency Special Assistant for Contracting Integrity is the exclusive representative of the Secretary of Defense to suspend and debar contractors from the purchase of Federal personal property under the Federal Property Management Regulations (41 CFR 101-45.6) and the Defense Materiel Disposition Manual (DoD 4160.21-M).</P>
                            <CITA>[56 FR 36313, July 31, 1991, as amended at 56 FR 67212, Dec. 30, 1991; 59 FR 27669, May 27, 1994; 60 FR 61593, Nov. 30, 1995; 61 FR 50452, Sept. 26, 1996; 63 FR 11528, Mar. 9, 1998; 64 FR 51075, Sept. 21, 1999; 64 FR 62985, Nov. 18, 1999; 68 FR 7439, Feb. 14, 2003; 70 FR 14573, Mar. 23, 2005; 74 FR 42780, Aug. 25, 2009; 74 FR 52895, Oct. 15, 2009; 76 FR 11367, Mar. 2, 2011; 76 FR 76319, Dec. 7, 2011; 77 FR 23631, Apr. 20, 2012; 77 FR 52253, Aug. 29, 2012; 84 FR 18155, Apr. 30, 2019; 88 FR 37794, June 9, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.405</SECTNO>
                            <SUBJECT>Effect of listing.</SUBJECT>
                            <P>(a) Under 10 U.S.C. 4654(b), when a department or agency determines that a compelling reason exists for it to conduct business with a contractor that is debarred or suspended from procurement programs, it must provide written notice of the determination to the General Services Administration (GSA), GSA Suspension and Debarment Official, Office of Acquisition Policy, 1275 First Street, NE., Washington, DC 20417. Examples of compelling reasons are—</P>
                            <P>(i) Only a debarred or suspended contractor can provide the supplies or services;</P>
                            <P>(ii) Urgency requires contracting with a debarred or suspended contractor;</P>
                            <P>
                                (iii) The contractor and a department or agency have an agreement covering the same events that resulted in the 
                                <PRTPAGE P="71"/>
                                debarment or suspension and the agreement includes the department or agency decision not to debar or suspend the contractor; or
                            </P>
                            <P>(iv) The national defense requires continued business dealings with the debarred or suspended contractor.</P>
                            <P>(b)(i) The Procurement Cause and Treatment Code “H” annotation in the Exclusions section of the System for Award Management (SAM Exclusions) identifies contractor facilities where no part of a contract or subcontract may be performed because of a violation of the Clean Air Act (42 U.S.C. 7606) or the Clean Water Act (33 U.S.C. 1368).</P>
                            <P>(ii) Under the authority of Section 8 of Executive Order 11738, the agency head may grant an exemption permitting award to a contractor using a Code “H” ineligible facility if the agency head determines that such an exemption is in the paramount interest of the United States.</P>
                            <P>(A) The agency head may delegate this exemption authority to a level no lower than a general or flag officer or a member of the Senior Executive Service.</P>
                            <P>(B) The official granting the exemption—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Shall promptly notify the Environmental Protection Agency suspending and debarring official of the exemption and the corresponding justification; and
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) May grant a class exemption only after consulting with the Environmental Protection Agency suspending and debarring official.
                            </P>
                            <P>(C) Exemptions shall be for a period not to exceed one year. The continuing necessity for each exemption shall be reviewed annually and, upon the making of a new determination, may be extended for periods not to exceed one year.</P>
                            <P>(D) All exemptions must be reported annually to the Environmental Protection Agency suspending and debarring official.</P>
                            <P>(E) See PGI 209.405 for additional procedures and information.</P>
                            <CITA>[74 FR 2414, Jan. 15, 2009, as amended at 76 FR 27274, May 11, 2011; 79 FR 73489, Dec. 11, 2014; 87 FR 76991, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.405-2</SECTNO>
                            <SUBJECT>Restrictions on subcontracting.</SUBJECT>
                            <P>(a) The contracting officer shall not consent to any subcontract with a firm, or a subsidiary of a firm, that is identified by the Secretary of Defense in SAM Exclusions as being owned or controlled by the government of a country that is a state sponsor of terrorism unless the agency head states in writing the compelling reasons for the subcontract. (See also 225.771.)</P>
                            <CITA>[79 FR 73489, Dec. 11, 2014]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.406</SECTNO>
                            <SUBJECT>Debarment.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.406-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>(a)(i) When the debarring official decides that debarment is not necessary, the official may require the contractor to enter into a written agreement which includes—</P>
                            <P>(A) A requirement for the contractor to establish, if not already established, and to maintain the standards of conduct and internal control systems prescribed by FAR subpart 3.10; and</P>
                            <P>(B) Other requirements the debarring official considers appropriate.</P>
                            <P>(ii) Before the debarring official decides not to suspend or debar in the case of an indictment or conviction for a felony, the debarring official must determine that the contractor has addressed adequately the circumstances that gave rise to the misconduct, and that appropriate standards of ethics and integrity are in place and are working.</P>
                            <CITA>[57 FR 14992, Apr. 23, 1992, as amended at 76 FR 76319, Dec. 7, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.406-2</SECTNO>
                            <SUBJECT>Causes for debarment.</SUBJECT>
                            <P>(1) Any person shall be considered for debarment if criminally convicted of intentionally affixing a label bearing a “Made in America” inscription to any product sold in or shipped to the United States or its outlying areas that was not made in the United States or its outlying areas (10 U.S.C. 4658).</P>
                            <P>(i) The debarring official will make a determination concerning debarment not later than 90 days after determining that a person has been so convicted.</P>
                            <P>
                                (ii) In cases where the debarring official decides not to debar, the debarring 
                                <PRTPAGE P="72"/>
                                official will report that decision to the Principal Director, Defense Pricing, Contracting, and Acquisition Policy, who will notify Congress within 30 days after the decision is made.
                            </P>
                            <P>(2) Any contractor that knowingly provides compensation to a former DoD official in violation of section 847 of the National Defense Authorization Act for Fiscal Year 2008 may face suspension and debarment proceedings in accordance with 41 U.S.C. 2105(c)(1)(C).</P>
                            <CITA>[58 FR 28464, May 13, 1993, as amended at 68 FR 7439, Feb. 14, 2003; 70 FR 35544, June 21, 2005; 74 FR 2409, Jan. 15, 2009; 76 FR 58136, Sept. 20, 2011; 87 FR 76991, Dec. 16, 2022; 88 FR 73236, Oct. 25, 2023; 89 FR 60831, July 29, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.406-3</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>Refer all matters appropriate for consideration by an agency debarring and suspending official as soon as practicable to the appropriate debarring and suspending official identified in 209.403. Any person may refer a matter to the debarring and suspending official. Follow the procedures at PGI 209.406-3.</P>
                            <CITA>[69 FR 74990, Dec. 15, 2004]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.407</SECTNO>
                            <SUBJECT>Suspension.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.407-3</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>Refer all matters appropriate for consideration by an agency debarring and suspending official as soon as practicable to the appropriate debarring and suspending official identified in 209.403. Any person may refer a matter to the debarring and suspending official. Follow the procedures at PGI 209.407-3.</P>
                            <CITA>[69 FR 74990, Dec. 15, 2004]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.409</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at 252.209-7004, Subcontracting with Firms that are Owned or Controlled by the Government of a Country that is a State Sponsor of Terrorism, in solicitations and contracts with a value of $150,000 or more.</P>
                            <CITA>[79 FR 73489, Dec. 11, 2014, as amended at 86 FR 59870, Oct. 29, 2021]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.470</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.471</SECTNO>
                            <SUBJECT>Congressional Medal of Honor.</SUBJECT>
                            <P>In accordance with Section 8118 of Pub. L. 105-262, do not award a contract to, extend a contract with, or approve the award of a subcontract to any entity that, within the preceding 15 years, has been convicted under 18 U.S.C. 704 of the unlawful manufacture or sale of the Congressional Medal of Honor. Any entity so convicted will be listed as ineligible on the List of Parties Excluded from Federal Procurement and Nonprocurement Programs published by the General Services Administration.</P>
                            <CITA>[64 FR 31733, June 14, 1999]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 209.5—Organizational and Consultant Conflicts of Interest</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>73 FR 1824, Jan. 10, 2008, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>209.505</SECTNO>
                            <SUBJECT>General rules.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.505-4</SECTNO>
                            <SUBJECT>Obtaining access to proprietary information.</SUBJECT>
                            <P>(b)(i) For contractors, other than litigation support contractors, accessing third party proprietary technical data or computer software, non-disclosure requirements are addressed at 227.7103-7(b), through use of the clause at 252.227-7025 as prescribed at 227.7103-6(c) and 227.7203-6(d). Pursuant to that clause, covered Government support contractors may be required to enter into non-disclosure agreements directly with the third party asserting restrictions on limited rights technical data, commercial technical data, or restricted rights computer software. The contracting officer is not required to obtain copies of these agreements or to ensure that they are properly executed.</P>
                            <P>
                                (ii) For litigation support contractors accessing litigation information, including that originating from third parties, use and non-disclosure requirements are addressed through the use of the clause at 252.204-7014, as prescribed at 204.7403(a). Pursuant to the clause, litigation support contractors are not required to enter into non-disclosure agreements directly with any third 
                                <PRTPAGE P="73"/>
                                party asserting restrictions on any litigation information.
                            </P>
                            <CITA>[78 FR 30238, May 22, 2013, as amended at 81 FR 28728, May 10, 2016; 81 FR 36473, June 7, 2016; 84 FR 58332, Oct. 31, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.570</SECTNO>
                            <SUBJECT>Limitations on contractors acting as lead system integrators.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.570-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>
                                <E T="03">Lead system integrator,</E>
                                 as used in this section, is defined in the clause at 252.209-7007, Prohibited Financial Interests for Lead System Integrators. See PGI 209.570-1 for additional information.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.570-2</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(a) Except as provided in paragraph (b) of this section, 10 U.S.C. 4292 prohibits any entity performing lead system integrator functions in the acquisition of a major system by DoD from having any direct financial interest in the development or construction of any individual system or element of any system of systems.</P>
                            <P>(b) The prohibition in paragraph (a) of this subsection does not apply if—</P>
                            <P>(1) The Secretary of Defense certifies to the Committees on Armed Services of the Senate and the House of Representatives that—</P>
                            <P>(i) The entity was selected by DoD as a contractor to develop or construct the system or element concerned through the use of competitive procedures; and</P>
                            <P>(ii) DoD took appropriate steps to prevent any organizational conflict of interest in the selection process; or</P>
                            <P>(2) The entity was selected by a subcontractor to serve as a lower-tier subcontractor, through a process over which the entity exercised no control.</P>
                            <P>(c) In accordance with section 802 of the National Defense Authorization Act for Fiscal Year 2008 (Pub. L. 110-181; 10 U.S.C. 4292 note), DoD may award a new contract for lead system integrator functions in the acquisition of a major system only if—</P>
                            <P>(1) The major system has not yet proceeded beyond low-rate initial production; or</P>
                            <P>(2) The Secretary of Defense determines in writing that it would not be practicable to carry out the acquisition without continuing to use a contractor to perform lead system integrator functions and that doing so is in the best interest of DoD. The authority to make this determination may not be delegated below the level of the Under Secretary of Defense for Acquisition and Sustainment. Also, see 209.570-3(b).</P>
                            <P>(d) Effective October 1, 2010, DoD is prohibited from awarding a new contract for lead system integrator functions in the acquisition of a major system to any entity that was not performing lead system integrator functions in the acquisition of the major system prior to January 28, 2008.</P>
                            <CITA>[73 FR 1824, Jan. 10, 2008, as amended at 74 FR 34268, July 15, 2009; 87 FR 76991, Dec. 16, 2022; 88 FR 73236, Oct. 25, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.570-3</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>(a) In making a responsibility determination before awarding a contract for the acquisition of a major system, the contracting officer shall—</P>
                            <P>(1) Determine whether the prospective contractor meets the definition of “lead system integrator”;</P>
                            <P>(2) Consider all information regarding the prospective contractor's direct financial interests in view of the prohibition at 209.570-2(a); and</P>
                            <P>(3) Follow the procedures at PGI 209.570-3.</P>
                            <P>(b) A determination to use a contractor to perform lead system integrator functions in accordance with 209.570-2(c)(2)—</P>
                            <P>(1) Shall specify the reasons why it would not be practicable to carry out the acquisition without continuing to use a contractor to perform lead system integrator functions, including a discussion of alternatives, such as use of the DoD workforce or a system engineering and technical assistance contractor;</P>
                            <P>(2) Shall include a plan for phasing out the use of contracted lead system integrator functions over the shortest period of time consistent with the interest of the national defense; and</P>
                            <P>(3) Shall be provided to the Committees on Armed Services of the Senate and the House of Representatives at least 45 days before the award of a contract pursuant to the determination.</P>
                            <CITA>[74 FR 34268, July 15, 2009]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="74"/>
                            <SECTNO>209.570-4</SECTNO>
                            <SUBJECT>Solicitation provision and contract clause.</SUBJECT>
                            <P>(a) Use the provision at 252.209-7006, Limitations on Contractors Acting as Lead System Integrators, in solicitations for the acquisition of a major system when the acquisition strategy envisions the use of a lead system integrator.</P>
                            <P>(b) Use the clause at 252.209-7007, Prohibited Financial Interests for Lead System Integrators—</P>
                            <P>(1) In solicitations that include the provision at 252.209-7006; and</P>
                            <P>(2) In contracts when the contractor will fill the role of a lead system integrator for the acquisition of a major system.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.571</SECTNO>
                            <SUBJECT>Organizational conflicts of interest in major defense acquisition programs.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.571-0</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>This subpart implements section 207 of the Weapons System Acquisition Reform Act of 2009 (Pub. L. 111-23).</P>
                            <CITA>[75 FR 81913, Dec. 29, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.571-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this section—</P>
                            <P>
                                “Lead system integrator” includes 
                                <E T="03">lead system integrator with system responsibility</E>
                                 and 
                                <E T="03">lead system integrator without system responsibility</E>
                                .
                            </P>
                            <P>
                                (i) 
                                <E T="03">Lead system integrator with system responsibility</E>
                                 means a prime contractor for the development or production of a major system, if the prime contractor is not expected at the time of award to perform a substantial portion of the work on the system and the major subsystems.
                            </P>
                            <P>
                                (ii) 
                                <E T="03">Lead system integrator without system responsibility</E>
                                 means a prime contractor under a contract for the procurement of services, the primary purpose of which is to perform acquisition functions closely associated with inherently governmental functions (see section 7.503(d) of the Federal Acquisition Regulation) with respect to the development or production of a major system.
                            </P>
                            <P>“Major subcontractor” means a subcontractor that is awarded a subcontract that equals or exceeds—</P>
                            <P>(i) Both the certified cost or pricing data threshold and 10 percent of the value of the contract under which the subcontract is awarded; or</P>
                            <P>(ii) $55 million.</P>
                            <P>“Pre-Major Defense Acquisition Program” means a program that is in the Materiel Solution Analysis or Technology Development Phases preceding Milestone B of the Defense Acquisition System and has been identified to have the potential to become a major defense acquisition program.</P>
                            <P>“Systems engineering and technical assistance.”</P>
                            <P>(1) “Systems engineering” means an interdisciplinary technical effort to evolve and verify an integrated and total life cycle balanced set of system, people, and process solutions that satisfy customer needs.</P>
                            <P>(2) “Technical assistance” means the acquisition support, program management support, analyses, and other activities involved in the management and execution of an acquisition program.</P>
                            <P>(3) “Systems engineering and technical assistance”—</P>
                            <P>(i) Means a combination of activities related to the development of technical information to support various acquisition processes. Examples of systems engineering and technical assistance activities include, but are not limited to, supporting acquisition efforts such as—</P>
                            <P>(A) Deriving requirements;</P>
                            <P>(B) Performing technology assessments;</P>
                            <P>(C) Developing acquisition strategies;</P>
                            <P>(D) Conducting risk assessments;</P>
                            <P>(E) Developing cost estimates;</P>
                            <P>(F) Determining specifications;</P>
                            <P>(G) Evaluating contractor performance and conducting independent verification and validation;</P>
                            <P>(H) Directing other contractors' (other than subcontractors) operations;</P>
                            <P>(I) Developing test requirements and evaluating test data;</P>
                            <P>(J) Developing work statements (but see paragraph (ii)(B) of this definition).</P>
                            <P>(ii) Does not include—</P>
                            <P>
                                (A) Design and development work of design and development contractors, in accordance with FAR 9.505-2(a)(3) or FAR 9.505-2(b)(3), and the guidance at PGI 209.571-7; or
                                <PRTPAGE P="75"/>
                            </P>
                            <P>(B) Preparation of work statements by contractors, acting as industry representatives, under the supervision and control of Government representatives, in accordance with FAR 9.505-2(b)(1)(ii).</P>
                            <CITA>[75 FR 81913, Dec. 29, 2010, as amended at 79 FR 4632, Jan. 29, 2014; 84 FR 25187, May 31, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.571-2</SECTNO>
                            <SUBJECT>Applicability.</SUBJECT>
                            <P>(a) This subsection applies to major defense acquisition programs.</P>
                            <P>(b) To the extent that this section is inconsistent with FAR subpart 9.5, this section takes precedence.</P>
                            <CITA>[75 FR 81913, Dec. 29, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.571-3</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>It is DoD policy that—</P>
                            <P>(a) Agencies shall obtain advice on major defense acquisition programs and pre-major defense acquisition programs from sources that are objective and unbiased; and</P>
                            <P>(b) Contracting officers generally should seek to resolve organizational conflicts of interest in a manner that will promote competition and preserve DoD access to the expertise and experience of qualified contractors. Accordingly, contracting officers should, to the extent feasible, employ organizational conflict of interest resolution strategies that do not unnecessarily restrict the pool of potential offerors in current or future acquisitions. Further, contracting activities shall not impose across-the-board restrictions or limitations on the use of particular resolution methods, except as may be required under 209.571-7 or as may be appropriate in particular acquisitions.</P>
                            <CITA>[75 FR 81913, Dec. 29, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.571-4</SECTNO>
                            <SUBJECT>Mitigation.</SUBJECT>
                            <P>(a) Mitigation is any action taken to minimize an organizational conflict of interest. Mitigation may require Government action, contractor action, or a combination of both.</P>
                            <P>(b) If the contracting officer and the contractor have agreed to mitigation of an organizational conflict of interest, a Government-approved Organizational Conflict of Interest Mitigation Plan, reflecting the actions a contractor has agreed to take to mitigate a conflict, shall be incorporated into the contract.</P>
                            <P>
                                (c) If the contracting officer determines, after consultation with agency legal counsel, that the otherwise successful offeror is unable to effectively mitigate an organizational conflict of interest, then the contracting officer, taking into account both the instant contract and longer term Government needs, shall use another approach to resolve the organizational conflict of interest, select another offeror, or request a waiver in accordance with FAR 9.503 (but 
                                <E T="03">see</E>
                                 statutory prohibition in 209.571-7, which cannot be waived).
                            </P>
                            <P>(d) For any acquisition that exceeds $1 billion, the contracting officer shall brief the senior procurement executive before determining that an offeror's mitigation plan is unacceptable.</P>
                            <CITA>[75 FR 81913, Dec. 29, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.571-5</SECTNO>
                            <SUBJECT>Lead system integrators.</SUBJECT>
                            <P>
                                For limitations on contractors acting as lead systems integrators, 
                                <E T="03">see</E>
                                 209.570.
                            </P>
                            <CITA>[75 FR 81913, Dec. 29, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.571-6</SECTNO>
                            <SUBJECT>Identification of organizational conflicts of interest.</SUBJECT>
                            <P>When evaluating organizational conflicts of interest for major defense acquisition programs or pre-major defense acquisition programs, contracting officers shall consider—</P>
                            <P>(a) The ownership of business units performing systems engineering and technical assistance, professional services, or management support services to a major defense acquisition program or a pre-major defense acquisition program by a contractor who simultaneously owns a business unit competing (or potentially competing) to perform as—</P>
                            <P>(1) The prime contractor for the same major defense acquisition program; or</P>
                            <P>(2) The supplier of a major subsystem or component for the same major defense acquisition program.</P>
                            <P>
                                (b) The proposed award of a major subsystem by a prime contractor to business units or other affiliates of the same parent corporate entity, particularly the award of a subcontract for software integration or the development of a proprietary software system architecture; and
                                <PRTPAGE P="76"/>
                            </P>
                            <P>(c) The performance by, or assistance of, contractors in technical evaluation.</P>
                            <CITA>[75 FR 81913, Dec. 29, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.571-7</SECTNO>
                            <SUBJECT>Systems engineering and technical assistance contracts.</SUBJECT>
                            <P>(a) Agencies shall obtain advice on systems architecture and systems engineering matters with respect to major defense acquisition programs or pre-major defense acquisition programs from Federally Funded Research and Development Centers or other sources independent of the major defense acquisition program contractor.</P>
                            <P>
                                (b) 
                                <E T="03">Limitation on Future Contracting.</E>
                                 (1) Except as provided in paragraph (c) of this subsection, a contract for the performance of systems engineering and technical assistance for a major defense acquisition program or a pre-major defense acquisition program shall prohibit the contractor or any affiliate of the contractor from participating as a contractor or major subcontractor in the development or production of a weapon system under such program.
                            </P>
                            <P>(2) The requirement in paragraph (b)(1) of this subsection cannot be waived.</P>
                            <P>
                                (c) 
                                <E T="03">Exception.</E>
                                 (1) The requirement in paragraph (b)(1) of this subsection does not apply if the head of the contracting activity determines that—
                            </P>
                            <P>(i) An exception is necessary because DoD needs the domain experience and expertise of the highly qualified, apparently successful offeror; and</P>
                            <P>(ii) Based on the agreed-to resolution strategy, the apparently successful offeror will be able to provide objective and unbiased advice, as required by 209.571-3(a), without a limitation on future participation in development and production.</P>
                            <P>(2) The authority to make this determination cannot be delegated.</P>
                            <CITA>[75 FR 81913, Dec. 29, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>209.571-8</SECTNO>
                            <SUBJECT>Solicitation provision and contract clause.</SUBJECT>
                            <P>(a) Use the provision at 252.209-7008, Notice of Prohibition Relating to Organizational Conflict of Interest—Major Defense Acquisition Program, if the solicitation includes the clause at 252.209-7009, Organizational Conflict of Interest—Major Defense Acquisition Program; and</P>
                            <P>(b) Use the clause at 252.209-7009, Organizational Conflict of Interest—Major Defense Acquisition Program, in solicitations and contracts for systems engineering and technical assistance for major defense acquisition programs or pre-major defense acquisition programs.</P>
                            <CITA>[75 FR 81913, Dec. 29, 2010]</CITA>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 210</EAR>
                    <HD SOURCE="HED">PART 210—MARKET RESEARCH</HD>
                    <CONTENTS>
                        <SECHD>Sec.</SECHD>
                        <SECTNO>210.001</SECTNO>
                        <SUBJECT>Policy.</SUBJECT>
                        <SECTNO>210.002</SECTNO>
                        <SUBJECT>Procedures.</SUBJECT>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>71 FR 53043, Sept. 8, 2006, unless otherwise noted.</P>
                    </SOURCE>
                    <SECTION>
                        <SECTNO>210.001</SECTNO>
                        <SUBJECT>Policy.</SUBJECT>
                        <P>(a) In addition to the requirements of FAR 10.001(a)—</P>
                        <P>(i)(A) Agencies shall conduct market research appropriate to the circumstances before issuing a solicitation with tiered evaluation of offers (section 816 of Pub. L. 109-163); and</P>
                        <P>(B) Use the results of market research to determine whether the criteria in FAR part 19 are met for setting aside the acquisition for small business or, for a task or delivery order, whether there are a sufficient number of qualified small business concerns available to justify limiting competition under the terms of the contract. If the contracting officer cannot determine whether the criteria are met, the contracting officer shall include a written explanation in the contract file as to why such a determination could not be made (section 816 of Pub. L. 109-163); and</P>
                        <P>(ii) Contracting officers shall use market research, where appropriate, to inform price reasonableness determinations (see 212.209 and 234.7002).</P>
                        <P>(c)(2) In addition to the notification requirements at FAR 10.001(c)(2)(i) and (ii), see 205.205-70 for the bundling notification publication requirement.</P>
                        <CITA>[71 FR 53043, Sept. 8, 2006, as amended at 75 FR 40716, July 13, 2010; 83 FR 15996, Apr. 13, 2018; 85 FR 34531, June 5, 2020]</CITA>
                    </SECTION>
                    <SECTION>
                        <PRTPAGE P="77"/>
                        <SECTNO>210.002</SECTNO>
                        <SUBJECT>Procedures.</SUBJECT>
                        <P>(e)(i) When contracting for services, see PGI 210.070 for the “Market Research Report Guide for Improving the Tradecraft in Services Acquisition”.</P>
                        <P>(ii) See PGI 210.002(e)(ii) regarding potential offerors that express an interest in an acquisition.</P>
                        <P>(iii) Follow the procedures at PGI 210.002(e)(iii) regarding contract file documentation.</P>
                        <CITA>[80 FR 21657, Apr. 20, 2015, as amended at 81 FR 65563, Sep. 23, 2016]</CITA>
                    </SECTION>
                </PART>
                <PART>
                    <EAR>Pt. 211</EAR>
                    <HD SOURCE="HED">PART 211—DESCRIBING AGENCY NEEDS</HD>
                    <CONTENTS>
                        <SECHD>Sec.</SECHD>
                        <SECTNO>211.002</SECTNO>
                        <SUBJECT>Policy.</SUBJECT>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 211.1—Selecting and Developing Requirements Documents</HD>
                            <SECTNO>211.104</SECTNO>
                            <SUBJECT>Use of brand name or equal purchase descriptions.</SUBJECT>
                            <SECTNO>211.106</SECTNO>
                            <SUBJECT>Purchase descriptions for service contracts.</SUBJECT>
                            <SECTNO>211.107</SECTNO>
                            <SUBJECT>Solicitation provision.</SUBJECT>
                            <SECTNO>211.170</SECTNO>
                            <SUBJECT>Use of proprietary specifications or standards.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 211.2—Using and Maintaining Requirements Documents</HD>
                            <SECTNO>211.201</SECTNO>
                            <SUBJECT>Identification and availability of specifications.</SUBJECT>
                            <SECTNO>211.204</SECTNO>
                            <SUBJECT>Solicitation provisions and contract clauses.</SUBJECT>
                            <SECTNO>211.270</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>211.271</SECTNO>
                            <SUBJECT>Elimination of use of class I ozone-depleting substances.</SUBJECT>
                            <SECTNO>211.272-211.273</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>211.274</SECTNO>
                            <SUBJECT>Item identification and valuation requirements.</SUBJECT>
                            <SECTNO>211.274-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>211.274-2</SECTNO>
                            <SUBJECT>Policy for item unique identification.</SUBJECT>
                            <SECTNO>211.274-3</SECTNO>
                            <SUBJECT>Policy for valuation.</SUBJECT>
                            <SECTNO>211.274-4</SECTNO>
                            <SUBJECT>Policy for assignment of Government-assigned serial numbers.</SUBJECT>
                            <SECTNO>211.274-5</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <SECTNO>211.275</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>211.275-1-211.275-3</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>211.274-6</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 211.5—Liquidated Damages</HD>
                            <SECTNO>211.500</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>211.503</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 211.6—Priorities and Allocations</HD>
                            <SECTNO>211.602</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 211.70—Purchase requests.</HD>
                            <SECTNO>211.7001</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>60 FR 61594, Nov. 30, 1995, unless otherwise noted.</P>
                    </SOURCE>
                    <SECTION>
                        <SECTNO>211.002</SECTNO>
                        <SUBJECT>Policy.</SUBJECT>
                        <P>All defense technology and acquisition programs in DoD are subject to the policies and procedures in DoDD 5000.01, The Defense Acquisition System, and DoDI 5000.02, Operation of the Adaptive Acquisition Framework.</P>
                        <CITA>[71 FR 27641, May 12, 2006, as amended at 76 FR 76319, Dec. 7, 2011; 88 FR 80466, Nov. 17, 2023]</CITA>
                    </SECTION>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 211.1—Selecting and Developing Requirements Documents</HD>
                        <SECTION>
                            <SECTNO>211.104</SECTNO>
                            <SUBJECT>Use of brand name or equal purchase descriptions.</SUBJECT>
                            <P>A justification and approval is required to use brand name or equal purchase descriptions—</P>
                            <P>(1) When using sealed bidding or negotiated acquisition procedures (see 206.302-1(c)(2) for justification requirements); or</P>
                            <P>(2) When using the simplified procedures for certain commercial products and commercial services at FAR 13.5 (see 213.501(a)(ii) for justification requirement).</P>
                            <CITA>[84 FR 25192, May 31, 2019, as amended at 88 FR 6581, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>211.106</SECTNO>
                            <SUBJECT>Purchase descriptions for service contracts.</SUBJECT>
                            <P>
                                Agencies shall require that purchase descriptions for service contracts and resulting requirements documents, such as statements of work or performance work statements, include language to provide a clear distinction between Government employees and contractor employees. Agencies shall be guided by the characteristics and descriptive elements of personal-services 
                                <PRTPAGE P="78"/>
                                contracts at FAR 37.104. Service contracts shall require contractor employees to identify themselves as contractor personnel by introducing themselves or being introduced as contractor personnel and displaying distinguishing badges or other visible identification for meetings with Government personnel. In addition, contracts shall require contractor personnel to appropriately identify themselves as contractor employees in telephone conversations and in formal and informal written correspondence.
                            </P>
                            <CITA>[76 FR 25566, May 5, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>211.107</SECTNO>
                            <SUBJECT>Solicitation provision.</SUBJECT>
                            <P>(b) To comply with section 875(c) of the National Defense Authorization Act for Fiscal Year 2017 (Pub. L. 114-328), use the provision at FAR 52.211-7, Alternatives to Government-Unique Standards, in DoD solicitations that include military or Government-unique specifications and standards.</P>
                            <CITA>[84 FR 4368, Feb. 15, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>211.170</SECTNO>
                            <SUBJECT>Use of proprietary specifications or standards.</SUBJECT>
                            <P>A justification and approval is required to use proprietary specifications and standards—</P>
                            <P>(1) When using sealed bidding or negotiated acquisition procedures (see 206.302-1(S-70) for justification requirements); or</P>
                            <P>(2) When using the simplified procedures for certain commercial products or commercial services at FAR 13.5 (see 213.501(a)(ii) for justification requirements).</P>
                            <CITA>[84 FR 25192, May 31, 2019, as amended at 88 FR 6581, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 211.2—Using and Maintaining Requirements Documents</HD>
                        <SECTION>
                            <SECTNO>211.201</SECTNO>
                            <SUBJECT>Identification and availability of specifications.</SUBJECT>
                            <P>Follow the procedures at PGI 211.201 for obtaining specifications, standards, and data item descriptions from the ASSIST database, including DoD adoption notices on voluntary consensus standards.</P>
                            <CITA>[84 FR 4368, Feb. 15, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>211.204</SECTNO>
                            <SUBJECT>Solicitation provisions and contract clauses.</SUBJECT>
                            <P>(c) When contract performance requires use of specifications, standards, and data item descriptions that are not listed in the Acquisition Streamlining and Standardization Information System database, use a provision, as appropriate, substantially the same as 252.211-7002, Availability for Examination of Specifications, Standards, Plans, Drawings, Data Item Descriptions, and Other Pertinent Documents.</P>
                            <CITA>[84 FR 25193, May 31, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>211.270</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>211.271</SECTNO>
                            <SUBJECT>Elimination of use of class I ozone-depleting substances.</SUBJECT>
                            <P>See 223.107-4 for restrictions on contracting for ozone-depleting substances.</P>
                            <CITA>[70 FR 73150, Dec. 9, 2005, as amended at 89 FR 66284, Aug. 15, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>211.272-211.273</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>211.274</SECTNO>
                            <SUBJECT>Item identification and valuation requirements.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>211.274-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>Item unique identification and valuation is a system of marking, valuing, and tracking items delivered to DoD that enhances logistics, contracting, and financial business transactions supporting the United States and coalition troops. Through item unique identification policy, which capitalizes on leading practices and embraces open standards, DoD—</P>
                            <P>(a) Achieves lower life-cycle cost of item management and improves life-cycle property management;</P>
                            <P>(b) Improves operational readiness;</P>
                            <P>(c) Provides reliable accountability of property and asset visibility throughout the life cycle;</P>
                            <P>(d) Reduces the burden on the workforce through increased productivity and efficiency; and</P>
                            <P>(e) Ensures item level traceability throughout lifecycle to strengthen supply chain integrity, enhance cyber security, and combat counterfeiting.</P>
                            <CITA>[78 FR 76071, Dec. 16, 2013]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="79"/>
                            <SECTNO>211.274-2</SECTNO>
                            <SUBJECT>Policy for item unique identification.</SUBJECT>
                            <P>(a) It is DoD policy that DoD item unique identification, or a DoD recognized unique identification equivalent, is required for all delivered items, including items of contractor-acquired property delivered on contract line items (see PGI 245.402-71 for guidance when delivery of contractor acquired property is required)—</P>
                            <P>(1) For which the Government's unit acquisition cost is $5,000 or more;</P>
                            <P>(2) For which the Government's unit acquisition cost is less than $5,000 when the requiring activity determines that item unique identification is required for mission essential or controlled inventory items; or</P>
                            <P>(3) Regardless of value for any—</P>
                            <P>(i) DoD serially managed item (reparable or nonreparable) or subassembly, component, or part embedded within a subassembly, component, or part;</P>
                            <P>(ii) Parent item (as defined in 252.211-7003(a)) that contains the embedded subassembly, component, or part;</P>
                            <P>(iii) Warranted serialized item;</P>
                            <P>(iv) Item of special tooling or special test equipment, as defined at FAR 2.101, for a major defense acquisition program that is designated for preservation and storage in accordance with the requirements of section 815 of the National Defense Authorization Act for Fiscal Year 2009 (Pub. L. 110-417); and</P>
                            <P>(v) High risk item identified by the requiring activity as vulnerable to supply chain threat, a target of cyber threats, or counterfeiting.</P>
                            <P>
                                (b) 
                                <E T="03">Exceptions.</E>
                                 The contractor will not be required to provide DoD item unique identification if—
                            </P>
                            <P>(1) The items, as determined by the head of the contracting activity, are to be used to support a contingency or humanitarian or peacekeeping operation; to facilitate defense against or recovery from nuclear, biological, chemical, or radiological attack; to facilitate the provision of international disaster assistance; or to support response to an emergency or major disaster; or</P>
                            <P>(2) A determination and findings has been executed concluding that it is more cost effective for the Government requiring activity to assign, mark, and register the unique item identifier after delivery, and the item is either acquired from a small business concern, or is a commercial product acquired under FAR part 12 or 8.</P>
                            <P>(i) The determination and findings shall be executed by—</P>
                            <P>(A) The Component Acquisition Executive for an acquisition category (ACAT) I program; or</P>
                            <P>(B) The head of the contracting activity for all other programs.</P>
                            <P>(ii) The DoD Unique Identification Policy Office must receive a copy of the determination and findings required by paragraph (b)(2)(i) of this subsection. Follow the procedures at PGI 211.274-2.</P>
                            <CITA>[70 FR 20836, Apr. 22, 2005, as amended at 76 FR 33168, June 8, 2011; 77 FR 52257, Aug. 29, 2012; 78 FR 76071, Dec. 16, 2013; 83 FR 24889, May 30, 2018; 88 FR 6581, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>211.274-3</SECTNO>
                            <SUBJECT>Policy for valuation.</SUBJECT>
                            <P>(a) It is DoD policy that contractors shall be required to identify the Government's unit acquisition cost for all deliverable end items to which item unique identification applies.</P>
                            <P>(b) The Government's unit acquisition cost is—</P>
                            <P>(1) For fixed-price type line, subline, or exhibit line items, the unit price identified in the contract at the time of delivery;</P>
                            <P>(2) For cost-type or undefinitized line, subline, or exhibit line items, the contractor's estimated fully burdened unit cost to the Government at the time of delivery; and</P>
                            <P>(3) For items delivered under a time-and-materials contract, the contractor's estimated fully burdened unit cost to the Government at the time of delivery.</P>
                            <P>(c) The Government's unit acquisition cost of subassemblies, components, and parts embedded in delivered items shall not be separately identified.</P>
                            <CITA>[70 FR 20836, Apr. 22, 2005, as amended at 78 FR 76072, Dec. 16, 2013]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>211.274-4</SECTNO>
                            <SUBJECT>Policy for assignment of Government-assigned serial numbers.</SUBJECT>
                            <P>
                                It is DoD policy that contractors apply Government-assigned serial numbers, such as tail numbers/hull numbers and equipment registration 
                                <PRTPAGE P="80"/>
                                numbers, in human-readable format on major end items when required by law, regulation, or military operational necessity. The latest version of MIL-STD-130, Marking of U.S. Military Property, shall be used for the marking of human-readable information.
                            </P>
                            <CITA>[75 FR 59103, Sept. 27, 2010. Redesignated at 88 FR 88536, Dec. 22, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>211.274-5</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>(a) Use the clause at 252.211-7003, Item Unique Identification and Valuation, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, for supplies, and for services involving the furnishing of supplies, unless the conditions in 211.274-2(b) apply.</P>
                            <P>(1) Identify in paragraph (c)(1)(ii) of the clause the contract line, subline, or exhibit line item number and description of any item(s) below $5,000 in unit acquisition cost for which DoD item unique identification or a DoD recognized unique identification equivalent is required in accordance with 211.274-2(a)(2).</P>
                            <P>(2) Identify in paragraph (c)(1)(iii) of the clause the applicable attachment number, when DoD item unique identification or a DoD recognized unique identification equivalent is required in accordance with 211.274-2(a)(3)(i) through (v).</P>
                            <P>(b) Use the clause at 252.211-7008, Use of Government-Assigned Serial Numbers, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, that—</P>
                            <P>(1) Contain the clause at 252.211-7003, Item Unique Identification and Valuation; and</P>
                            <P>(2) Require the contractor to mark major end items under the terms and conditions of the contract.</P>
                            <CITA>[72 FR 52298, Sept. 13, 2007, as amended at 73 FR 70908, Nov. 24, 2008. Redesignated and amended at 75 FR 59103, Sept. 27, 2010; 77 FR 52257, Aug. 29, 2012; 78 FR 37984, June 25, 2012; 78 FR 76072, Dec. 16, 2013; 79 FR 44313, July 31, 2014; 80 FR 51750, Aug. 26, 2015; 88 FR 6581, Jan. 31, 2023. Redesignated and amended at 88 FR 88536, Dec. 22, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>211.275</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>211.275-1-211.275-3</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 211.5—Liquidated Damages</HD>
                        <SECTION>
                            <SECTNO>211.500</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>This subpart and FAR subpart 11.5 do not apply to liquidated damages for comprehensive subcontracting plans under the Test Program for Negotiation of Comprehensive Small Business Subcontracting Plans. See 219.702-70 for coverage of liquidated damages for comprehensive subcontracting plans.</P>
                            <CITA>[83 FR 15998, Apr. 13, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>211.503</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>(b) Use the clause at FAR 52.211-12, Liquidated Damages—Construction, in all construction contracts exceeding $750,000, except cost-plus-fixed-fee contracts or contracts where the contractor cannot control the pace of the work. Use of the clause in contracts of $750,000 or less is optional.</P>
                            <CITA>[60 FR 61594, Nov. 30, 1995. Redesignated at 66 FR 49861, Oct. 1, 2001; 71 FR 75892, Dec. 19, 2006; 75 FR 45073, Aug. 2, 2010; 80 FR 36904, June 26, 2015; 85 FR 61504, Sept. 29, 2020]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 211.6—Priorities and Allocations</HD>
                        <SECTION>
                            <SECTNO>211.602</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>DoD implementation of the Defense Priorities and Allocations System is in DoDD 4400.1, Defense Production Act Programs.</P>
                            <CITA>[64 FR 51075, Sept. 21, 1999]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">SUBPART 211.70—PURCHASE REQUESTS</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>87 FR 15817, Mar. 18, 2022, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>211.7001</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>Follow the procedures at PGI 211.7001 for developing and distributing purchase requests, except for the requirements for Military Interdepartmental Purchase Requests (DD Form 448) addressed in 253.208-1.</P>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <PRTPAGE P="81"/>
                    <EAR>Pt. 212</EAR>
                    <HD SOURCE="HED">PART 212—ACQUISITION OF COMMERCIAL PRODUCTS AND COMMERCIAL SERVICES</HD>
                    <CONTENTS>
                        <SECTNO>212.001</SECTNO>
                        <SUBJECT>Definitions.</SUBJECT>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 212.1—Acquisition of Commercial Products and Commercial Services</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>212.102</SECTNO>
                            <SUBJECT>Applicability.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 212.2—Special Requirements for the Acquisition of Commercial Items</HD>
                            <SECTNO>212.203</SECTNO>
                            <SUBJECT>Procedures for solicitation, evaluation, and award.</SUBJECT>
                            <SECTNO>212.205</SECTNO>
                            <SUBJECT>Offers.</SUBJECT>
                            <SECTNO>212.207</SECTNO>
                            <SUBJECT>Contract type.</SUBJECT>
                            <SECTNO>212.209</SECTNO>
                            <SUBJECT>Determination of price reasonableness.</SUBJECT>
                            <SECTNO>212.211</SECTNO>
                            <SUBJECT>Technical data.</SUBJECT>
                            <SECTNO>212.212</SECTNO>
                            <SUBJECT>Computer software.</SUBJECT>
                            <SECTNO>212.270</SECTNO>
                            <SUBJECT>Major weapon systems as commercial products.</SUBJECT>
                            <SECTNO>212.271</SECTNO>
                            <SUBJECT>Limitation on acquisition of right-hand drive passenger sedans.</SUBJECT>
                            <SECTNO>212.272</SECTNO>
                            <SUBJECT>Preference for certain commercial products and commercial services.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 212.3—Solicitation Provisions and Contract Clauses for the Acquisition of Commercial Products and Commercial Services</HD>
                            <SECTNO>212.301</SECTNO>
                            <SUBJECT>Solicitation provisions and contract clauses for the acquisition of commercial products and commercial services.</SUBJECT>
                            <SECTNO>212.302</SECTNO>
                            <SUBJECT>Tailoring of provisions and clauses for the acquisition of commercial products and commercial services.</SUBJECT>
                            <SECTNO>212.370</SECTNO>
                            <SUBJECT>Inapplicability of certain provisions and clauses to contracts and subcontracts for the acquisition of commercial products, commercial services, and commercially available off-the-shelf items.</SUBJECT>
                            <SECTNO>212.371</SECTNO>
                            <SUBJECT>Inapplicability of certain provisions and clauses to contracts for the acquisition of commercially available off-the-shelf items.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 212.5—Applicability of Certain Laws to the Acquisition of Commercial Products, Commercial Services, and Commercially Available Off-the-Shelf Items</HD>
                            <SECTNO>212.503</SECTNO>
                            <SUBJECT>Applicability of certain laws to Executive agency contracts for the acquisition of commercial products and commercial services.</SUBJECT>
                            <SECTNO>212.504</SECTNO>
                            <SUBJECT>Applicability of certain laws to subcontracts for the acquisition of commercial products and commercial services.</SUBJECT>
                            <SECTNO>212.505</SECTNO>
                            <SUBJECT>Applicability of certain laws to contracts for the acquisition of COTS items.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 212.6—Streamlined Procedures for Evaluation and Solicitation for Commercial Products and Commercial Services</HD>
                            <SECTNO>212.602</SECTNO>
                            <SUBJECT>Streamlined evaluation of offers.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 212.70—Defense Commercial Solutions Opening</HD>
                            <SECTNO>212.7000</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>212.7001</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <SECTNO>212.7002</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>212.7003</SECTNO>
                            <SUBJECT>Limitations.</SUBJECT>
                            <SECTNO>212.7004</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>212.7005</SECTNO>
                            <SUBJECT>Congressional notification.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <RESERVED>Subpart 212.71 [Reserved]</RESERVED>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>60 FR 61595, Nov. 30, 1995, unless otherwise noted.</P>
                    </SOURCE>
                    <SECTION>
                        <SECTNO>212.001</SECTNO>
                        <SUBJECT>Definitions.</SUBJECT>
                        <P>As used in this part—</P>
                        <P>
                            <E T="03">Market research</E>
                             means a review of existing systems, subsystems, capabilities, and technologies that are available or could be made available to meet the needs of DoD in whole or in part. The review shall include, at a minimum, contacting knowledgeable individuals in Government and industry regarding existing market capabilities and pricing information, and may include any of the techniques for conducting market research provided in FAR 10.002(b)(2) (section 855 of the National Defense Authorization Act for Fiscal Year 2016 (Pub. L. 114-92)).
                        </P>
                        <CITA>[83 FR 4442, Jan. 31, 2018, as amended at 85 FR 19688, Apr. 8, 2020]</CITA>
                    </SECTION>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 212.1—Acquisition of Commercial Products and Commercial Services</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>73 FR 4114, Jan. 24, 2008, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>212.102</SECTNO>
                            <SUBJECT>Applicability.</SUBJECT>
                            <P>
                                (a)(i) 
                                <E T="03">Use of FAR part 12 procedures.</E>
                                 Use of FAR part 12 procedures is based on—
                            </P>
                            <P>
                                (A) A determination that an item is a commercial product or commercial 
                                <PRTPAGE P="82"/>
                                service (see paragraph (a)(iii) of this section); or
                            </P>
                            <P>(B) Applicability of one of the following statutes that provide for treatment as a commercial product or commercial service and use of FAR part 12 procedures, even though the item may not meet the definition of “commercial product” or “commercial service” at FAR 2.101 and does not require a commercial product or commercial service determination:</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) 41 U.S.C. 1903—Supplies or services to be used to facilitate defense against or recovery from cyber, nuclear, biological, chemical, or radiological attack pursuant to FAR 12.102(f).
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) 10 U.S.C. 3457 —Supplies or services from nontraditional defense contractors pursuant to 212.102(a)(iv).
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) 10 U.S.C. 3458—Supplies or services resulting from a commercial solutions opening pursuant to subpart 212.70.
                            </P>
                            <P>
                                (ii) 
                                <E T="03">Prior use of FAR part 12 procedures.</E>
                                 (A) Pursuant to 10 U.S.C. 3456(c), except as provided in paragraph (a)(ii)(B) of this section or unless the item was acquired pursuant to paragraph (a)(i)(B) of this section, if the Commercial Item Database (for website see PGI 212.102(a)(iii)(A)(
                                <E T="03">1</E>
                                )) contains a prior commerciality determination, or the contracting officer has other evidence that an item has previously been acquired by DoD using commercial product and commercial service acquisition procedures under FAR part 12, then the prior contract shall serve as a prior determination that an item is a a commercial product or commercial service. The contracting officer shall document the file accordingly.
                            </P>
                            <P>
                                (B)(
                                <E T="03">1</E>
                                ) If the item to be acquired meets the criteria in paragraph (a)(ii)(A) of this section, the item may not be acquired using other than FAR part 12 procedures unless the head of the contracting activity issues a determination as specified in paragraph (a)(ii)(B)(
                                <E T="03">2</E>
                                )(
                                <E T="03">ii</E>
                                ) of this section.
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Pursuant to 10 U.S.C. 3703(d)(1), the contracting officer may presume that a prior commercial product or commercial service determination made by a military department, a defense agency, or another component of DoD shall serve as a determination for subsequent procurements of such item. In accordance with 10 U.S.C. 3703(d) and 10 U.S.C. 3456(c), if the contracting officer questions a prior determination to use FAR part 12 procedures and instead chooses to proceed with a procurement of an item previously determined to be a commercial item using procedures other than FAR part 12 procedures, the contracting officer shall request a review by the head of the contracting activity that will conduct the procurement. Not later than 30 days after receiving a request for review, the head of the contracting activity shall—
                            </P>
                            <P>
                                (
                                <E T="03">i</E>
                                ) Confirm that the prior use of FAR part 12 procedures was appropriate and still applicable; or
                            </P>
                            <P>
                                (
                                <E T="03">ii)</E>
                                 Issue a determination that the prior use of FAR part 12 procedures was improper or that it is no longer appropriate to acquire the item using FAR part 12 procedures, with a written explanation of the basis for the determination.
                            </P>
                            <P>
                                (iii) 
                                <E T="03">Commercial product or commercial service determination.</E>
                                 Unless the procedures in paragraph (a)(ii) of this section are applicable, when using FAR part 12 procedures for acquisitions of commercial products and commercial service pursuant to 212.102(a)(i)(A) that exceed the simplified acquisition threshold, the contracting officer shall—
                            </P>
                            <P>(A) Determine in writing that the acquisition meets the “commercial product” or “commercial service” definition in FAR 2.101. See 234.7002(b) and (c) for subsystems of major weapon systems and components and spare parts of major weapon systems and of subsystems of major weapon systems;</P>
                            <P>(B) Include the written determination in the contract file;</P>
                            <P>(C) Obtain approval at one level above the contracting officer when a commercial product or commercial service determination relies on paragraph (1)(ii), (3), or (4) of the “commercial product” definition at FAR 2.101 or paragraph (2) of the “commercial service” definition at FAR 2.101; and</P>
                            <P>
                                (D) Follow the procedures and guidance at PGI 212.102(a)(iii) regarding file documentation and commercial product or commercial service determinations.
                                <PRTPAGE P="83"/>
                            </P>
                            <P>
                                (iv) 
                                <E T="03">Nontraditional defense contractors.</E>
                                 In accordance with 10 U.S.C. 3457, contracting officers—
                            </P>
                            <P>(A) Except as provided in paragraph (a)(iv)(B) of this section, may treat supplies and services provided by nontraditional defense contractors as commercial products or commercial services. This permissive authority is intended to enhance defense innovation and investment, enable DoD to acquire items that otherwise might not have been available, and create incentives for nontraditional defense contractors to do business with DoD. It is not intended to recategorize current other than commercial products or commercial services; however, when appropriate, contracting officers may consider applying commercial product or commercial service procedures to the procurement of supplies and services from business segments that meet the definition of “nontraditional defense contractor” even though they have been established under traditional defense contractors. The decision to apply commercial product and commercial service procedures to the procurement of supplies and services from nontraditional defense contractors does not require a commercial product or commercial service determination and does not mean the item is commercial;</P>
                            <P>(B) Shall treat services provided by a business unit that is a nontraditional defense contractor as commercial services, to the extent that such services use the same pool of employees as used for commercial customers and are priced using methodology similar to methodology used for commercial pricing; and</P>
                            <P>(C) Shall document the file when treating supplies or services from a nontraditional defense contractor as commercial products or commercial services in accordance with paragraph (a)(iv)(A) or (B) of this section.</P>
                            <P>
                                (v) 
                                <E T="03">Commercial item guidebook.</E>
                                 For a link to the commercial item guidebook, see PGI 212.102(a)(v).
                            </P>
                            <CITA>[87 FR 25143, Apr. 28, 2022, as amended at 87 FR 76991, Dec. 16, 2022; 88 FR 6581, Jan. 31, 2023; 88 FR 55939, Aug. 17, 2023; 89 FR 46808, May 30, 2024]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 212.2—Special Requirements for the Acquisition of Commercial Products and Commercial Services</HD>
                        <SECTION>
                            <SECTNO>212.203</SECTNO>
                            <SUBJECT>Procedures for solicitation, evaluation, and award.</SUBJECT>
                            <P>(1) See 215.101-2-70 for the limitations and prohibitions on the use of the lowest price technically acceptable source selection process, which are applicable to the acquisition of commercial products and commercial services.</P>
                            <P>(2) See 217.7801 for the prohibition on the use of reverse auctions for personal protective equipment and aviation critical safety items.</P>
                            <P>(3) See 204.7603 for procedures on the required use of Supplier Performance Risk System risk assessments as part of the award decision.</P>
                            <P>(4) See subpart 212.70 for acquisitions resulting from a commercial solutions opening.</P>
                            <P>(5) See 215.101-71 and 225.7024 for the acquisition of fuel for overseas contingency operations.</P>
                            <CITA>[84 FR 50788, Sept. 26, 2019, as amended at 88 FR 6582, Jan. 31, 2023; 88 FR 17339, Mar. 22, 2023; 88 FR 55939, Aug. 17, 2023; 89 FR 78998, Sept. 26, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>212.205</SECTNO>
                            <SUBJECT>Offers.</SUBJECT>
                            <P>(c) When using competitive procedures, if only one offer is received, the contracting officer shall follow the procedures at 215.371.</P>
                            <CITA>[77 FR 39138, June 29, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>212.207</SECTNO>
                            <SUBJECT>Contract type.</SUBJECT>
                            <P>(b) In accordance with section 805 of the National Defense Authorization Act for Fiscal Year 2008 (Pub. L. 110-181), use of time-and-materials and labor-hour contracts for the acquisition of commercial services is authorized only for the following:</P>
                            <P>
                                (i) Services acquired for support of a commercial product, as described in paragraph (1) of the definition of 
                                <E T="03">commercial service</E>
                                 at FAR 2.101 (41 U.S.C. 103a).
                            </P>
                            <P>(ii) Emergency repair services.</P>
                            <P>
                                (iii) Any other commercial services only to the extent that the head of the agency concerned approves a written determination by the contracting officer that—
                                <PRTPAGE P="84"/>
                            </P>
                            <P>
                                (A) The services to be acquired are commercial services as defined in paragraph (2) of the definition of 
                                <E T="03">commercial service</E>
                                 at FAR 2.101 (41 U.S.C. 103a);
                            </P>
                            <P>(B) If the services to be acquired are subject to FAR 15.403-1(c)(3)(ii), the offeror of the services has submitted sufficient information in accordance with that subsection;</P>
                            <P>(C) Such services are commonly sold to the general public through use of time-and-materials or labor-hour contracts; and</P>
                            <P>(D) The use of a time-and-materials or labor-hour contract type is in the best interest of the Government.</P>
                            <CITA>[74 FR 34264, July 15, 2009, as amended at 74 FR 35826, July 21, 2009; 76 FR 21812, Apr. 19, 2011; 76 FR 58136, Sept. 20, 2011; 87 FR 15817, Mar. 18, 2022; 88 FR 6582, Jan. 31, 2023; 89 FR 66285, Aug. 15, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>212.209</SECTNO>
                            <SUBJECT>Determination of price reasonableness.</SUBJECT>
                            <P>(a) In accordance with 10 U.S.C. 3453(d), agencies shall conduct or obtain market research to support the determination of the reasonableness of price for commercial products and commercial services contained in any bid or offer submitted in response to an agency solicitation. To the extent necessary to support such market research, the contracting officer—</P>
                            <P>(1) In the case of major weapon systems, for subsystems of major weapon systems and components and spare parts of major weapon systems and of subsystems of major weapon systems acquired as commercial products in accordance with subpart 234.70, shall use information submitted under 234.7002(e); and</P>
                            <P>(2) In the case of other items, may require the offeror to submit other relevant information.</P>
                            <P>(b) If the contracting officer determines that the information obtained through market research pursuant to paragraph (a) of this section is insufficient to determine the reasonableness of price, the contracting officer shall consider information submitted by the offeror of recent purchase prices paid by the Government and commercial customers for the same or similar commercial products or commercial services under comparable terms and conditions in establishing price reasonableness on a subsequent purchase if the contracting officer is satisfied that the prices previously paid remain a valid reference for comparison. In assessing whether the prices previously paid remain a valid reference for comparison, the contracting officer shall consider the totality of other relevant factors such as the time elapsed since the prior purchase and any differences in the quantities purchased (10 U.S.C. 3703(e)).</P>
                            <P>(c) If the contracting officer determines that the offeror cannot provide sufficient information as described in paragraph (b) of this section to determine the reasonableness of price, the contracting officer should request the offeror to submit information on—</P>
                            <P>(1) Prices paid for the same or similar items sold under different terms and conditions;</P>
                            <P>(2) Prices paid for similar levels of work or effort on related products or services;</P>
                            <P>(3) Prices paid for alternative solutions or approaches; and</P>
                            <P>(4) Other relevant information that can serve as the basis for determining the reasonableness of price.</P>
                            <P>(d) Nothing in this section shall be construed to preclude the contracting officer from requiring the contractor to supply information that is sufficient to determine the reasonableness of price, regardless of whether or not the contractor was required to provide such information in connection with any earlier procurement. If the contracting officer determines that the pricing information submitted is not sufficient to determine the reasonableness of price, the contracting officer may request other relevant information regarding the basis for price or cost, including uncertified cost data such as labor costs, material costs, and other direct and indirect costs.</P>
                            <CITA>[83 FR 4442, Jan. 31, 2018, as amended at 85 FR 34531, June5, 2020; 87 FR 76991, Dec. 16, 2022; 88 FR 6582, Jan. 31, 2023; 89 FR 46808, May 30, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>212.211</SECTNO>
                            <SUBJECT>Technical data.</SUBJECT>
                            <P>The DoD policy for acquiring technical data for commercial products or commercial services is at 227.7102.</P>
                            <CITA>[73 FR 4114, Jan. 24, 2008, as amended at 88 FR 6582, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="85"/>
                            <SECTNO>212.212</SECTNO>
                            <SUBJECT>Computer software.</SUBJECT>
                            <P>(1) Departments and agencies shall identify and evaluate, at all stages of the acquisition process (including concept refinement, concept decision, and technology development), opportunities for the use of commercial computer software and other non-developmental software in accordance with Section 803 of the National Defense Authorization Act for Fiscal Year 2009 (Pub. L. 110-417).</P>
                            <P>
                                (2) See Subpart 208.74 when acquiring commercial software or software maintenance. 
                                <E T="03">See</E>
                                 227.7202 for policy on the acquisition of commercial computer software and commercial computer software documentation.
                            </P>
                            <CITA>[74 FR 34270, July 15, 2009]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>212.270</SECTNO>
                            <SUBJECT>Major weapon systems as commercial products.</SUBJECT>
                            <P>The DoD policy for acquiring major weapon systems as commercial products is in subpart 234.70.</P>
                            <CITA>[88 FR 6582, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>212.271</SECTNO>
                            <SUBJECT>Limitation on acquisition of right-hand drive passenger sedans.</SUBJECT>
                            <P>10 U.S.C. 2253(a)(2) limits the authority to purchase right-hand drive passenger sedans to a cost of not more than $45,000 per vehicle.</P>
                            <CITA>[77 FR 19128, Mar. 30, 2012, as amended at 85 FR 61504, Sept. 29, 2020]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>212.272</SECTNO>
                            <SUBJECT>Preference for certain commercial products and commercial services.</SUBJECT>
                            <P>(a) As required by section 855 of the National Defense Authorization Act for Fiscal Year 2016 (Pub. L. 114-92), for requirements relating to the acquisition of commercial information technology products and services, see 239.101.</P>
                            <P>(b)(1) As required by section 876 of the National Defense Authorization Act of Fiscal Year 2017 (Pub. L. 114-328), a contracting officer may not enter into a contract above the simplified acquisition threshold for facilities-related services, knowledge-based services (except engineering services), medical services, or transportation services that are not commercial services, unless the appropriate official specified in paragraph (b)(2) of this section determines in writing that no commercial services are suitable to meet the agency's needs as provided in 10 U.S.C. 3453(c)(2).</P>
                            <P>(2) The following officials are authorized to make the determination specified in paragraph (b)(1) of this section:</P>
                            <P>(i) For contracts above $10 million, the head of the contracting activity, the combatant commander of the combatant command concerned, or the Under Secretary of Defense for Acquisition and Sustainment (as applicable).</P>
                            <P>(ii) For contracts in an amount above the simplified acquisition threshold and at or below $10 million, the contracting officer.</P>
                            <CITA>[84 FR 39204, Aug. 9, 2019, as amended at 87 FR 76991, Dec. 16, 2022]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 212.3—Solicitation Provisions and Contract Clauses for the Acquisition of Commercial Products and Commercial Services</HD>
                        <SECTION>
                            <SECTNO>212.301</SECTNO>
                            <SUBJECT>Solicitation provisions and contract clauses for the acquisition of commercial products and commercial services.</SUBJECT>
                            <P>(c) Include an evaluation factor regarding supply chain risk (see subpart 239.73) when acquiring information technology, whether as a service or as a supply, that is a covered system, is a part of a covered system, or is in support of a covered system, as defined in 239.7301.</P>
                            <P>
                                (f) The following additional provisions and clauses apply to DoD solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services. If the offeror has completed any of the following provisions listed in this paragraph electronically as part of its annual representations and certifications at 
                                <E T="03">https://www.sam.gov,</E>
                                 the contracting officer shall consider this information instead of requiring the offeror to complete these provisions for a particular solicitation. The contracting officer shall not use other FAR or DFARS provisions and clauses unless required by the FAR or DFARS or consistent with customary commercial practices (section 874(b)(1)(A), Pub. L. 114-328).
                                <PRTPAGE P="86"/>
                            </P>
                            <P>
                                (i) 
                                <E T="03">Part 203—Improper Business Practices and Personal Conflicts of Interest.</E>
                                 (A) Use the FAR clause at 52.203-3, Gratuities, as prescribed in FAR 3.202, to comply with 10 U.S.C. 4651.
                            </P>
                            <P>(B) Use the clause at 252.203-7000, Requirements Relating to Compensation of Former DoD Officials, as prescribed in 203.171-4(a), to comply with section 847 of Pub. L. 110-181.</P>
                            <P>(C) Use the clause at 252.203-7002, Requirement to Inform Employees of Whistleblower Rights, as prescribed in 203.970, to comply with 10 U.S.C. 4701.</P>
                            <P>(D) Use the clause at 252.203-7003, Agency Office of the Inspector General, as prescribed in 203.1004(a), to comply with section 6101 of Pub. L. 110-252 and 41 U.S.C. 3509.</P>
                            <P>(E) Use the provision at 252.203-7005, Representation Relating to Compensation of Former DoD Officials, as prescribed in 203.171-4(b).</P>
                            <P>
                                (ii) 
                                <E T="03">Part 204—Administrative and Information Matters.</E>
                            </P>
                            <P>(A) Use the clause at 252.204-7004, Antiterrorism Awareness Training for Contractors, as prescribed in 204.7203.</P>
                            <P>(B) Use the provision at 252.204-7008, Compliance with Safeguarding Covered Defense Information Controls, as prescribed in 204.7304(a).</P>
                            <P>(C) Use the clause at 252.204-7009, Limitations on the Use or Disclosure of Third-Party Contractor Reported Cyber Incident Information, as prescribed in 204.7304(b).</P>
                            <P>(D) Use the clause at 252.204-7012, Safeguarding Covered Defense Information and Cyber Incident Reporting, as prescribed in 204.7304(c).</P>
                            <P>(E) Use the clause at 252.204-7014, Limitations on the Use or Disclosure of Information by Litigation Support Contractors, as prescribed in204.7403(a), to comply with 10 U.S.C. 129d.</P>
                            <P>(F) Use the clause at 252.204-7015, Notice of Authorized Disclosure of Information for Litigation Support, as prescribed in 204.7403(b), to comply with 10 U.S.C. 129d.</P>
                            <P>(G) Use the provision at 252.204-7016, Covered Defense Telecommunications Equipment or Services—Representation, as prescribed in 204.2105(a), to comply with section 1656 of the National Defense Authorization Act for Fiscal Year 2018 (Pub. L. 115-91).</P>
                            <P>(H) Use the provision at 252.204-7017, Prohibition on the Acquisition of Covered Defense Telecommunications Equipment or Services—Representation, as prescribed in 204.2105(b), to comply with section 1656 of the National Defense Authorization Act for Fiscal Year 2018 (Pub. L. 115-91).</P>
                            <P>(I) Use the clause at 252.204-7018, Prohibition on the Acquisition of Covered Defense Telecommunications Equipment or Services, as prescribed in 204.2105(c), to comply with section 1656 of the National Defense Authorization Act for Fiscal Year 2018 (Pub. L. 115-91).</P>
                            <P>(J) Use the provision at 252.204-7019, Notice of NIST SP 800-171 DoD Assessment Requirements, as prescribed in 204.7304(d).</P>
                            <P>(K) Use the clause at 252.204-7020, NIST SP 800-171 DoD Assessment Requirements, as prescribed in 204.7304(e).</P>
                            <P>(L) Use the clause at 252.204-7021, Cybersecurity Maturity Model Certification Requirements, as prescribed in 204.7503(a) and (b).</P>
                            <P>(M) Use the clause at 252.204-7022, Expediting Contract Closeout, as prescribed in 204.804-70.</P>
                            <P>(N) Use the clause at 252.204-7023, Reporting Requirements for Contracted Services, to comply with 10 U.S.C. 4505.</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Use the basic clause as prescribed in 204.1705(a)(i) and (ii).
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Use the alternate I clause as prescribed in 204.1705(a)(i) and (iii).
                            </P>
                            <P>(O) Use the provision at 252.204-7024, Notice on the Use of the Supplier Performance Risk System, as prescribed in 204.7604.</P>
                            <P>
                                (iii) 
                                <E T="03">Part 205—Publicizing Contract Actions.</E>
                                 Use the clause at 252.205-7000, Provision of Information to Cooperative Agreement Holders, as prescribed in 205.470, to comply with 10 U.S.C. 4957.
                            </P>
                            <P>
                                (iv) 
                                <E T="03">Part 209—Contractor Qualifications.</E>
                                 Use the provision at 252.209-7011, Representation for Restriction on the Use of Certain Institutions of Higher Education, as prescribed at 209.170-4, to comply with section 1062 of the National Defense Authorization Act for Fiscal Year 2021 (Pub. L. 116-283).
                            </P>
                            <P>
                                (v) 
                                <E T="03">Part 211—Describing Agency Needs.</E>
                                 (A) Use the clause at 252.211-7003, Item Unique Identification and Valuation, as prescribed in 211.274-5(a).
                                <PRTPAGE P="87"/>
                            </P>
                            <P>(B) Use the clause at 252.211-7008, Use of Government-Assigned Serial Numbers, as prescribed in 211.274-5(b).</P>
                            <P>
                                (vi) 
                                <E T="03">Part 215—Contracting by Negotiation.</E>
                                 (A) Use the provision at 252.215-7003, Requirements for Submission of Data Other Than Certified Cost or Pricing Data—Canadian Commercial Corporation, as prescribed at 215.408(2)(i).
                            </P>
                            <P>(B) Use the clause at 252.215-7004, Requirement for Submission of Data other Than Certified Cost or Pricing Data—Modifications—Canadian Commercial Corporation, as prescribed at 215.408(2)(ii).</P>
                            <P>(C) Use the provision at 252.215-7007, Notice of Intent to Resolicit, as prescribed in 215.371-6.</P>
                            <P>(D) Use the provision 252.215-7008, Only One Offer, as prescribed at 215.408(3).</P>
                            <P>(E) Use the provision 252.215-7010, Requirements for Certified Cost or Pricing Data and Data Other Than Certified Cost or Pricing Data, as prescribed at 215.408(5)(i) to comply with section 831 of the National Defense Authorization Act for Fiscal Year 2013 (Pub. L. 112-239) and sections 851 and 853 of the National Defense Authorization Act for Fiscal Year 2016 (Pub. L. 114-92).</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Use the basic provision as prescribed at 215.408(5)(i)(A).
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Use the alternate I provision as prescribed at 215.408(5)(i)(B).
                            </P>
                            <P>(F) Use the provision at 252.215-7016, Notification to Offerors—Postaward Debriefings, as prescribed in 215.570, to comply with section 818 of the National Defense Authorization Act for Fiscal Year 2018 (Pub. L. 115-91).</P>
                            <P>
                                (vii) 
                                <E T="03">Part 216—Types of Contracts.</E>
                                 Use the clause at 252.216-7010, Postaward Debriefings for Task Orders and Delivery Orders, as prescribed in 216.506-70(b), to comply with section 818 of the National Defense Authorization Act for Fiscal Year 2018 (Pub. L. 115-91).
                            </P>
                            <P>
                                (viii) 
                                <E T="03">Part 219—Small Business Programs.</E>
                                (A) Use the provision at 252.219-7000, Advancing Small Business Growth, as prescribed in 219.309(1), to comply with 10 U.S.C. 4959.
                            </P>
                            <P>(B) Use the clause at 252.219-7003, Small Business Subcontracting Plan (DoD Contracts), to comply with 15 U.S.C. 637.</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Use the basic clause as prescribed in 219.708(b)(1)(A)(
                                <E T="03">1</E>
                                ).
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Use the alternate I clause as prescribed in 219.708(b)(1)(A)(
                                <E T="03">2</E>
                                ).
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) Use the alternate II clause as prescribed in 219.708(b)(1)(A)(
                                <E T="03">3</E>
                                ).
                            </P>
                            <P>(C) Use the clause at 252.219-7004, Small Business Subcontracting Plan (Test Program), as prescribed in 219.708(b)(1)(B), to comply with 15 U.S.C. 637 note.</P>
                            <P>(D) Use the provision at 252.219-7012, Competition for Religious-Related Services, as prescribed in 219.270-3.</P>
                            <P>
                                (ix) 
                                <E T="03">Part 223—Environment, Sustainable Acquisition, and Material Safety.</E>
                                 (A) Use the clause at 252.223-7008, Prohibition of Hexavalent Chromium, as prescribed in 223.7306.
                            </P>
                            <P>(B) Use the clause at 252.223-7009, Prohibition of Procurement of Fluorinated Fire-Fighting Agent for Use on Military Installations, as prescribed at 223.7404 to comply with section 322(b), (c), and (d) of the National Defense Authorization Act for Fiscal Year 2020 (Pub. L. 116-92).</P>
                            <P>
                                (x) 
                                <E T="03">Part 225—Foreign Acquisition.</E>
                                 (A) Use the provision at 252.225-7000, Buy American—Balance of Payments Program Certificate, to comply with 41 U.S.C. chapter 83 and Executive Order 10582 of December 17, 1954, Prescribing Uniform Procedures for Certain Determinations Under the Buy-American Act.
                            </P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Use the basic provision as prescribed in 225.1101(1)(i).
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Use the alternate I provision as prescribed in 225.1101(1)(ii).
                            </P>
                            <P>(B) Use the clause at 252.225-7001, Buy American and Balance of Payments Program, to comply with 41 U.S.C. chapter 83 and Executive Order 10582 of December 17, 1954, Prescribing Uniform Procedures for Certain Determinations Under the Buy-American Act.</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Use the basic clause as prescribed in 225.1101(2)(ii).
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Use the alternate I clause as prescribed in 225.1101(2)(iii).
                            </P>
                            <P>
                                (C) Use the clause at 252.225-7006, Acquisition of the American Flag, as prescribed in 225.7002-3(c), to comply with section 8123 of the DoD Appropriations Act, 2014 (Pub. L. 113-76, division C, title VIII), and the same provision in subsequent DoD appropriations acts.
                                <PRTPAGE P="88"/>
                            </P>
                            <P>(D) Use the clause at 252.225-7007, Prohibition on Acquisition of Certain Items from Communist Chinese Military Companies, as prescribed in 225.1103(4), to comply with section 1211 of the National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2006 (Pub. L. 109-163) as amended by the NDAAs for FY 2012 and FY 2017.</P>
                            <P>(E) Use the clause at 252.225-7008, Restriction on Acquisition of Specialty Metals, as prescribed in 225.7003-5(a)(1), to comply with 10 U.S.C. 4863.</P>
                            <P>(F) Use the clause at 252.225-7009, Restriction on Acquisition of Certain Articles Containing Specialty Metals, as prescribed in 225.7003-5(a)(2), to comply with 10 U.S.C. 4863.</P>
                            <P>(G) Use the provision at 252.225-7010, Commercial Derivative Military Article—Specialty Metals Compliance Certificate, as prescribed in 225.7003-5(b), to comply with 10 U.S.C. 4863.</P>
                            <P>(H) Use the clause at 252.225-7012, Preference for Certain Domestic Commodities, as prescribed in 225.7002-3(a), to comply with 10 U.S.C. 4862.</P>
                            <P>(I) Use the clause at 252.225-7015, Restriction on Acquisition of Hand or Measuring Tools, as prescribed in 225.7002-3(b), to comply with 10 U.S.C. 4862.</P>
                            <P>(J) Use the clause at 252.225-7016, Restriction on Acquisition of Ball and Roller Bearings, as prescribed in 225.7009-5, to comply with section 8065 of Pub. L. 107-117 and the same restriction in subsequent DoD appropriations acts.</P>
                            <P>(K) Use the clause at 252.225-7017, Photovoltaic Devices, as prescribed in 225.7017-4(a), to comply with section 846 of Public Law 111-383.</P>
                            <P>(L) Use the provision at 252.225-7018, Photovoltaic Devices—Certificate, as prescribed in 225.7017-4(b), to comply with section 846 of Public Law 111-383.</P>
                            <P>(M) Use the clause at 252.225-7019, Restriction on Acquisition of Anchor and Mooring Chain, as prescribed in 225.7004-7(a), to comply with 10 U.S.C. 4864 and section 8041 of the Fiscal Year 1991 DoD Appropriations Act (Pub. L. 101-511) and similar sections in subsequent DoD appropriations acts.</P>
                            <P>(N) Use the provision at 252.225-7020, Trade Agreements Certificate, to comply with 19 U.S.C. 2501-2518 and 19 U.S.C. 4501-4732. Alternate I also implements section 886 of the National Defense Authorization Act for Fiscal Year 2008 (Pub. L. 110-181).</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Use the basic provision as prescribed in 225.1101(5)(i).
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Use the alternate I provision as prescribed in 225.1101(5)(ii).
                            </P>
                            <P>(O) Use the clause at 252.225-7021, Trade Agreements to comply with 19 U.S.C. 2501-2518 and 19 U.S.C. 4501-4732.</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Use the basic clause as prescribed in 225.1101(6)(i).
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Use the alternate II clause as prescribed in 225.1101(6)(iii).
                            </P>
                            <P>(P) Use the provision at 252.225-7023, Preference for Products or Services from Afghanistan, as prescribed in 225.7703-4(a), to comply with section 886 of the National Defense Authorization Act for Fiscal Year 2008 (Pub. L. 110-181).</P>
                            <P>(Q) Use the clause at 252.225-7024, Requirement for Products or Services from Afghanistan, as prescribed in 225.7703-4(b), to comply with section 886 of the National Defense Authorization Act for Fiscal Year 2008 (Pub. L. 110-181).</P>
                            <P>(R) Use the clause at 252.225-7026, Acquisition Restricted to Products or Services from Afghanistan, as prescribed in 225.7703-4(c), to comply with section 886 of the National Defense Authorization Act for Fiscal Year 2008 (Pub. L. 110-181).</P>
                            <P>(S) Use the clause at 252.225-7027, Restriction on Contingent Fees for Foreign Military Sales, as prescribed in 225.7307(a), to comply with 22 U.S.C. 2779.</P>
                            <P>(T) Use the clause at 252.225-7028, Exclusionary Policies and Practices of Foreign Governments, as prescribed in 225.7307(b), to comply with 22 U.S.C. 2755.</P>
                            <P>(U) Use the clause at 252.225-7029, Acquisition of Uniform Components for Afghan Military or Afghan National Police, as prescribed in 225.7703-4(d).</P>
                            <P>(V) Use the provision at 252.225-7031, Secondary Arab Boycott of Israel, as prescribed in 225.7605, to comply with 10 U.S.C. 4659.</P>
                            <P>
                                (W) Use the provision at 252.225-7035, Buy American—Free Trade Agreements—Balance of Payments Program Certificate, to comply with 41 U.S.C. chapter 83 and 19 U.S.C. 4501-4732. Alternates II, III, and V also implement 
                                <PRTPAGE P="89"/>
                                section 886 of the National Defense Authorization Act for Fiscal Year 2008 (Pub. L. 110-181).
                            </P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Use the basic provision as prescribed in 225.1101(9)(i).
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Use the alternate I provision as prescribed in 225.1101(9)(ii).
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) Use the alternate II provision as prescribed in 225.1101(9)(iii).
                            </P>
                            <P>
                                (
                                <E T="03">4</E>
                                ) Use the alternate III provision as prescribed in 225.1101(9)(iv).
                            </P>
                            <P>
                                (
                                <E T="03">5</E>
                                ) Use the alternate IV provision as prescribed in 225.1101(9)(v).
                            </P>
                            <P>
                                (
                                <E T="03">6</E>
                                ) Use the alternate V provision as prescribed in 225.1101(9)(vi).
                            </P>
                            <P>(X) Use the clause at 252.225-7036, Buy American—Free Trade Agreements—Balance of Payments Program to comply with 41 U.S.C. chapter 83 and 19 U.S.C. 4501-4732. Alternates II, III, and V also implement section 886 of the National Defense Authorization Act for Fiscal Year 2008 (Pub. L. 110-181).</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Use the basic clause as prescribed in 225.1101(10)(i)(A).
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Use the alternate I clause as prescribed in 225.1101(10)(i)(B).
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) Use the alternate II clause as prescribed in 225.1101(10)(i)(C).
                            </P>
                            <P>
                                (
                                <E T="03">4</E>
                                ) Use the alternate III clause as prescribed in 225.1101(10)(i)(D).
                            </P>
                            <P>
                                (
                                <E T="03">5</E>
                                ) Use the alternate IV clause as prescribed in 225.1101(10)(i)(E).
                            </P>
                            <P>
                                (
                                <E T="03">6</E>
                                ) Use the alternate V clause as prescribed in 225.1101(10)(i)(F).
                            </P>
                            <P>(Y) Use the clause at 252.225-7039, Defense Contractors Performing Private Security Functions Outside the United States, as prescribed in 225.302-6, to comply with section 2 of Public Law 110-181, as amended.</P>
                            <P>(Z) Use the clause at 252.225-7040, Contractor Personnel Supporting U.S. Armed Forces Deployed Outside the United States, as prescribed in 225.371-5(a).</P>
                            <P>(AA) Use the clause at 252.225-7043, Antiterrorism/Force Protection Policy for Defense Contractors Outside the United States, as prescribed in 225.372-2.</P>
                            <P>(BB) Use the provision at 252.225-7049, Prohibition on Acquisition of Certain Foreign Commercial Satellite Services—Representations, as prescribed in 225.772-5(a), to comply with 10 U.S.C. 2279.</P>
                            <P>(CC) Use the provision at 252.225-7050, Disclosure of Ownership or Control by the Government of a Country that is a State Sponsor of Terrorism, as prescribed in 225.771-5, to comply with 10 U.S.C. 4871(b).</P>
                            <P>(DD) Use the clause at 252.225-7051, Prohibition on Acquisition for Certain Foreign Commercial Satellite Services, as prescribed in 225.772-5(b), to comply with 10 U.S.C. 2279.</P>
                            <P>(EE) Use the clause at 252.225-7052, Restriction on the Acquisition of Certain Magnets, Tantalum, and Tungsten, as prescribed in 225.7018-5, to comply with 10 U.S.C. 4872.</P>
                            <P>(FF) Use the provision at 252.225-7053, Representation Regarding Prohibition on Use of Certain Energy Sourced from Inside the Russian Federation, as prescribed in 225.7019-4(a), to comply with section 2821 of the National Defense Authorization Act for Fiscal Year 2020 (Pub. L. 116-92).</P>
                            <P>(GG) Use the clause at 252.225-7054, Prohibition on Use of Certain Energy Sourced from Inside the Russian Federation, as prescribed in 225.7019-4(b), to comply with section 2821 of the National Defense Authorization Act for Fiscal Year 2020 (Pub. L. 116-92).</P>
                            <P>(HH) Use the provision at 252.225-7055, Representation Regarding Business Operations with the Maduro Regime, as prescribed in 225.7020-5(a), to comply with section 890 of the National Defense Authorization Act for Fiscal Year 2020 (Pub. L. 116-92).</P>
                            <P>(II) Use the clause at 252.225-7056, Prohibition Regarding Business Operations with the Maduro Regime, as prescribed in 225.7020-5(b), to comply with section 890 of the National Defense Authorization Act for Fiscal Year 2020 (Pub. L. 116-92).</P>
                            <P>(JJ) Use the provision at 252.225-7059, Prohibition on Certain Procurements from the Xinjiang Uyghur Autonomous Region—Representation, as prescribed in 225.7022-5(a), to comply with section 855 of the National Defense Authorization Act for Fiscal Year 2023 (Pub. L. 117-263) and 10 U.S.C. 4661.</P>
                            <P>
                                (KK) Use the clause at 252.225-7060, Prohibition on Certain Procurements from the Xinjiang Uyghur Autonomous Region, as prescribed in 225.7022-5(b), to comply with section 855 of the National Defense Authorization Act for Fiscal Year 2023 (Pub. L. 117-263) and 10 U.S.C. 4661.
                                <PRTPAGE P="90"/>
                            </P>
                            <P>(LL) Use the clause at 252.225-7061, Restriction on the Acquisition of Personal Protective Equipment and Certain Other Items from Non-Allied Foreign Nations, as prescribed in 225.7023-4, to comply with 10 U.S.C. 4875.</P>
                            <P>(MM) Use the clause at 252.225-7062, Restriction on Acquisition of Large Medium-Speed Diesel Engines, as prescribed in 225.7004-7(b), to comply with 10 U.S.C. 4864.</P>
                            <P>(NN) Use the clause at 252.225-7063, Restriction on Acquisition of Components of T-AO 205 and T-ARC Class Vessels, as prescribed in 225.7004-7(c), to comply with 10 U.S.C. 4864.</P>
                            <P>(OO) Use the clause at 252.225-7064, Restriction on Acquisition of Certain Satellite Components, as prescribed in 225.7004-7(d), to comply with 10 U.S.C. 4864.</P>
                            <P>(PP) Use the provision at 252.225-7065, Restriction on Acquisition of Fuel for Overseas Contingency Operations, as prescribed in 225.7024-4, to comply with section 843 of the National Defense Authorization Act for Fiscal Year 2022 (Pub. L. 117-81).</P>
                            <P>
                                (xi) 
                                <E T="03">Part 226—Other Socioeconomic Programs.</E>
                                 (A) Use the clause at 252.226-7001, Utilization of Indian Organizations, Indian-Owned Economic Enterprises, and Native Hawaiian Small Business Concerns, as prescribed in 226.104, to comply with section 8021 of Pub. L. 107-248 and similar sections in subsequent DoD appropriations acts.
                            </P>
                            <P>(B) Use the provision at 252.226-7002, Representation for Demonstration Project for Contractors Employing Persons with Disabilities, as prescribed in 226.7203.</P>
                            <P>
                                (xii) 
                                <E T="03">Part 227—Patents, Data, and Copyrights.</E>
                                 (A) Use the clause at 252.227-7013, Rights in Technical Data-Other Than Commercial Products and Commercial Services, as prescribed in 227.7103-6(a). Use the clause with its Alternate I as prescribed in 227.7103-6(b)(1). Use the clause with its Alternate II as prescribed in 227.7103-6(b)(2), to comply with 10 U.S.C. 8687 and 17 U.S.C. 1301, 
                                <E T="03">et seq.</E>
                            </P>
                            <P>
                                (B) Use the clause at 252.227-7015, Technical Data-Commercial Products and Commercial Services, as prescribed in 227.7102-4(a)(1), to comply with 10 U.S.C. 3772(a). Use the clause with its Alternate I as prescribed in 227.7102-4(a)(2), to comply with 10 U.S.C. 8687 and 17 U.S.C. 1301, 
                                <E T="03">et seq.</E>
                            </P>
                            <P>(C) Use the clause at 252.227-7037, Validation of Restrictive Markings on Technical Data, as prescribed in 227.7102-4(c).</P>
                            <P>
                                (xiii) 
                                <E T="03">Part 229—Taxes.</E>
                                 Use the clause at 252.229-7014, Full Exemption from Two-Percent Excise Tax on Certain Foreign Procurements, as prescribed at 229.402-70, to comply with 26 U.S.C. 5000C.
                            </P>
                            <P>
                                (xiv) 
                                <E T="03">Part 232—Contract Financing.</E>
                                 (A) Use the clause at 252.232-7003, Electronic Submission of Payment Requests and Receiving Reports, as prescribed in 232.7004, to comply with 10 U.S.C. 4601.
                            </P>
                            <P>(B) Use the clause at 252.232-7006, Wide Area WorkFlow Payment Instructions, as prescribed in 232.7004(b).</P>
                            <P>(C) Use the clause at 252.232-7009, Mandatory Payment by Governmentwide Commercial Purchase Card, as prescribed in 232.1110.</P>
                            <P>(D) Use the clause at 252.232-7010, Levies on Contract Payments, as prescribed in 232.7102.</P>
                            <P>(E) Use the clause at 252.232-7011, Payments in Support of Emergencies and Contingency Operations, as prescribed in 232.908.</P>
                            <P>(F) Use the provision at 252.232-7014, Notification of Payment in Local Currency (Afghanistan), as prescribed in 232.7202.</P>
                            <P>
                                (xv) 
                                <E T="03">Part 237—Service Contracting.</E>
                                 (A) Use the clause at 252.237-7010, Prohibition on Interrogation of Detainees by Contractor Personnel, as prescribed in 237.173-5, to comply with section 1038 of Pub. L. 111-84.
                            </P>
                            <P>(B) Use the clause at 252.237-7019, Training for Contractor Personnel Interacting with Detainees, as prescribed in 237.171-4, to comply with section 1092 of Pub. L. 108-375.</P>
                            <P>
                                (C) Use the provision at 252.237-7025, Preaward Transparency Requirements for Firms Offering to Support Department of Defense Audits—Representation and Disclosure, as prescribed in 237.270(e)(3), to comply with section 1006 of the National Defense Authorization Act for Fiscal Year 2019 (Pub. L. 115-232) and section 1011 of the National Defense Authorization Act for Fiscal Year 2020 (Pub. L. 116-92).
                                <PRTPAGE P="91"/>
                            </P>
                            <P>(D) Use the clause at 252.237-7026, Postaward Transparency Requirements for Firms that Support Department of Defense Audits, as prescribed in 237.270(e)(4), to comply with section 1006 of the National Defense Authorization Act for Fiscal Year 2019 (Pub. L. 115-232) and section 1011 of the National Defense Authorization Act for Fiscal Year 2020 (Pub. L. 116-92).</P>
                            <P>(E) Use the clause at 252.237-7027, Transfer and Adoption of Military Animals, as prescribed in 237.7804 to comply with 10 U.S.C. 2387.</P>
                            <P>
                                (xvi) 
                                <E T="03">Part 239—Acquisition of Information Technology.</E>
                                 (A) Use the provision 252.239-7009, Representation of Use of Cloud Computing, as prescribed in 239.7604(a).
                            </P>
                            <P>(B) Use the clause 252.239-7010, Cloud Computing Services, as prescribed in 239.7604(b).</P>
                            <P>(C) Use the provision at 252.239-7017, Notice of Supply Chain Risk, as prescribed in 239.7306(a), to comply with 10 U.S.C. 3252.</P>
                            <P>(D) Use the clause at 252.239-7018, Supply Chain Risk, as prescribed in 239.7306(b), to comply with 10 U.S.C. 3252.</P>
                            <P>
                                (xvii) 
                                <E T="03">Part 243—Contract Modifications.</E>
                                 Use the clause at 252.243-7002, Requests for Equitable Adjustment, as prescribed in 243.205-71, to comply with 10 U.S.C. 3862.
                            </P>
                            <P>
                                (xviii) 
                                <E T="03">Part 244—Subcontracting Policies and Procedures.</E>
                                 Use the clause at 252.244-7000, Subcontracts for Commercial Products and Commercial Services, as prescribed in 244.403.
                            </P>
                            <P>
                                (xix) 
                                <E T="03">Part 245—Government Property.</E>
                                 Use the clause at 252.245-7005, Management and Reporting of Government Property, as prescribed in 245.107(4).
                            </P>
                            <P>
                                (xx) 
                                <E T="03">Part 246—Quality Assurance.</E>
                                 (A) Use the clause at 252.246-7003, Notification of Potential Safety Issues, as prescribed in246.370(a).
                            </P>
                            <P>(B) Use the clause at 252.246-7004, Safety of Facilities, Infrastructure, and Equipment for Military Operations, as prescribed in 246.270-4, to comply with section 807 of Pub. L. 111-84.</P>
                            <P>(C) Use the clause at 252.246-7008, Sources of Electronic Parts, as prescribed in 246.870-3(b), to comply with section 818(c)(3) of Public Law 112-81, as amended by section 817 of the National Defense Authorization Act for Fiscal Year 2015 (Pub. L. 113-291 and section 885 of the National Defense Authorization Act for Fiscal Year 2016 (Pub. L. 114-92).</P>
                            <P>
                                (xxi) 
                                <E T="03">Part 247—Transportation.</E>
                                 (A) Use the clause at 252.247-7003, Pass-Through of Motor Carrier Fuel Surcharge Adjustment to the Cost Bearer, as prescribed in 247.207, to comply with section 884 of Public Law 110-417.
                            </P>
                            <P>(B) Use the basic or one of the alternates of the clause at 252.247-7023, Transportation of Supplies by Sea, as prescribed in 247.574(a), to comply with the Cargo Preference Act of 1904 (10 U.S.C. 2631(a)).</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Use the basic clause as prescribed in 247.574(a)(1).
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Use the alternate I clause as prescribed in 247.574(a)(2).
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) Use the alternate II clause as prescribed in 247.574(a)(3).
                            </P>
                            <P>(C) Use the clause 252.247-7025, Reflagging or Repair Work, as prescribed in 247.574(b), to comply with 10 U.S.C. 2631(b).</P>
                            <P>(D) Use the 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, as prescribed in 247.574(c), to comply with section 1017 of Public Law 109-364.</P>
                            <P>(E) Use the clause at 252.247-7027, Riding Gang Member Requirements, as prescribed in 247.574(d), to comply with section 3504 of the National Defense Authorization Act for Fiscal Year 2009 (Pub. L. 110-417).</P>
                            <P>(F) Use the clause at 252.247-7028, Application for U.S. Government Shipping Documentation/Instructions, as prescribed in 247.207.</P>
                            <CITA>[80 FR 2019, Jan. 15, 2015]</CITA>
                            <EDNOTE>
                                <HD SOURCE="HED">Editorial Note:</HD>
                                <P>
                                    For 
                                    <E T="04">Federal Register</E>
                                     citations affecting section 212.301, see the List of CFR Sections Affected, which appears in the Finding Aids section of the printed volume and at 
                                    <E T="03">www.govinfo.gov.</E>
                                </P>
                            </EDNOTE>
                        </SECTION>
                        <SECTION>
                            <SECTNO>212.302</SECTNO>
                            <SUBJECT>Tailoring of provisions and clauses for the acquisition of commercial products and commercial services.</SUBJECT>
                            <P>
                                (c) 
                                <E T="03">Tailoring inconsistent with customary commercial practice.</E>
                                 The head of 
                                <PRTPAGE P="92"/>
                                the contracting activity is the approval authority within the DoD for waivers under FAR 12.302(c).
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>212.370</SECTNO>
                            <SUBJECT>Inapplicability of certain provisions and clauses to contracts and subcontracts for the acquisition of commercial products, commercial services, and commercially available off-the-shelf items.</SUBJECT>
                            <P>The following provisions and clauses, not expressly authorized in law, are not applicable to contracts for the acquisition of commercial products and commercial services:</P>
                            <P>(a) FAR 52.204-22, Alternative Line Item Proposal.</P>
                            <P>(b) [Reserved]</P>
                            <CITA>[88 FR 80464, Nov. 17, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>212.371</SECTNO>
                            <SUBJECT>Inapplicability of certain provisions and clauses to contracts for the acquisition of commercially available off-the-shelf items.</SUBJECT>
                            <P>Commercially available off-the-shelf (COTS) items are a subset of commercial products. Therefore, the provisions and clauses listed in 212.370 as not applicable to contracts or subcontracts for the acquisition of commercial products are also not applicable to contracts or subcontracts for the acquisition of COTS items. In addition, the following provisions and clauses published after January 1, 2015, not expressly authorized in law, are not applicable to contracts for the acquisition of COTS items:</P>
                            <P>(a) FAR 52.204-21, Basic Safeguarding of Covered Contractor Information Systems.</P>
                            <P>(b) [Reserved]</P>
                            <CITA>[88 FR 80464, Nov. 17, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 212.5—Applicability of Certain Laws to the Acquisition of Commercial Products, Commercial Services, and Commercially Available Off-the-Shelf Items</HD>
                        <SECTION>
                            <SECTNO>212.503</SECTNO>
                            <SUBJECT>Applicability of certain laws to Executive agency contracts for the acquisition of commercial products and commercial services.</SUBJECT>
                            <P>(a) The following laws are not applicable to contracts for the acquisition of commercial products or commercial services:</P>
                            <P>(i) 10 U.S.C. 3321(b), Prohibition on Contingent Fees.</P>
                            <P>(ii) 10 U.S.C. 3741-3750, Allowable Costs Under Defense Contracts.</P>
                            <P>(iii) 10 U.S.C. 3845, Contractor Inventory Accounting System Standards (see 252.242-7004).</P>
                            <P>(iv) 10 U.S.C. 4651, note prec. (section 855, Pub. L. 117-81), Employment Transparency Regarding Individuals Who Perform Work in the People's Republic of China.</P>
                            <P>(v) 10 U.S.C. 4656(a), Prohibition on Persons Convicted of Defense Related Felonies.</P>
                            <P>(vi) 10 U.S.C. 4753(b), Requirement to Identify Suppliers.</P>
                            <P>(vii) 10 U.S.C. 4864, Miscellaneous Limitations on the Procurement of Goods Other Than United States Goods. 10 U.S.C. 4864 is not applicable to contracts valued at or below the simplified acquisition threshold.</P>
                            <P>(viii) Section 8116 of the Defense Appropriations Act for Fiscal Year 2010 (Pub. L. 111-118) (prohibits mandatory arbitration) and similar sections in subsequent DoD appropriations acts.</P>
                            <P>(ix) Domestic Content Restrictions in the National Defense Appropriations Acts for Fiscal Years 1996 and Subsequent Years, unless the restriction specifically applies to commercial products or commercial services. For the restriction that specifically applies to commercial ball or roller bearings as end items, see 225.7009-3 (section 8065 of Pub. L. 107-117).</P>
                            <P>(c) The applicability of the following laws has been modified in regard to contracts for the acquisition of commercial products and commercial services:</P>
                            <P>(i) 10 U.S.C. 3703, Truthful Cost or Pricing Data (see FAR 15.403-1(b)(3)).</P>
                            <P>
                                (ii) 10 U.S.C. 4655, Prohibition on Limiting Subcontractor Direct Sales to 
                                <PRTPAGE P="93"/>
                                the United States (see FAR 3.503 and 52.203-6).
                            </P>
                            <CITA>[60 FR 61595, Nov. 30, 1995, as amended at 63 FR 11851, Mar. 11, 1998; 63 FR 55040, Oct. 14, 1998; 65 FR 77828, Dec. 13, 2000; 67 FR 4208, Jan. 29, 2002; 69 FR 65089, Nov. 10, 2004; 73 FR 76970, Dec. 18, 2008; 75 FR 27947, May 19, 2010; 76 FR 38047, June 29, 2011; 76 FR 76319, Dec. 7, 2011; 79 FR 73489, Dec. 11, 2014; 87 FR 52341, Aug. 25, 2022; 87 FR 76991, Dec. 16, 2022; 88 FR 6582, Jan. 31, 2023; 88 FR 25512, Apr. 27, 2023; 88 FR 46902, July 20, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>212.504</SECTNO>
                            <SUBJECT>Applicability of certain laws to subcontracts for the acquisition of commercial products and commercial services.</SUBJECT>
                            <P>(a) The following laws are not applicable to subcontracts at any tier for the acquisition of commercial products, commercial services, or commercial components:</P>
                            <P>(i) 10 U.S.C. 2391 note, Notification of Substantial Impact on Employment.</P>
                            <P>(ii) 10 U.S.C. 2631, Transportation of Supplies by Sea (except as provided in the clause at 252.247-7023, Transportation of Supplies by Sea).</P>
                            <P>(iii) 10 U.S.C. 3321(b), Prohibition on Contingent Fees.</P>
                            <P>(iv) 10 U.S.C. 3741-3750, Allowable Costs Under Defense Contracts.</P>
                            <P>(v) 10 U.S.C. 3841(d), Examination of Records of a Contractor.</P>
                            <P>(vi) 10 U.S.C. 3845, Contractor Inventory Accounting System Standards.</P>
                            <P>(vii) 10 U.S.C. 4651, note prec. (section 855, Pub. L. 117-81), Employment Transparency Regarding Individuals Who Perform Work in the People's Republic of China.</P>
                            <P>(viii) 10 U.S.C. 4654, Prohibition Against Doing Business with Certain Offerors or Contractors.</P>
                            <P>(ix) 10 U.S.C. 4656(a), Prohibition on Persons Convicted of Defense Related Felonies.</P>
                            <P>(x) 10 U.S.C. 4753(b), Requirement to Identify Suppliers.</P>
                            <P>(xi) 10 U.S.C. 4801 note prec., Notification of Proposed Program Termination.</P>
                            <P>(xii) 10 U.S.C. 4864, Miscellaneous Limitations on the Procurement of Goods Other Than United States Goods. 10 U.S.C. 4864 is not applicable to subcontracts valued at or below the simplified acquisition threshold.</P>
                            <P>(xiii) 10 U.S.C. 4871, Reporting Requirement Regarding Dealings with Terrorist Countries.</P>
                            <P>(xiv) Section 8116 of the Defense Appropriations Act for Fiscal Year 2010 (Pub. L. 111-118) (prohibits mandatory arbitration) and similar sections in subsequent DoD appropriations acts.</P>
                            <P>(xv) Domestic Content Restrictions in the National Defense Appropriations Acts for Fiscal Years 1996 and Subsequent Years, unless the restriction specifically applies to commercial products and commercial services. For the restriction that specifically applies to commercial ball or roller bearings as end items, see 225.7009-3 (section 8065 of Pub. L. 107-117).</P>
                            <P>(b) Certain requirements of the following laws have been eliminated for subcontracts at any tier for the acquisition of commercial products, commercial services, or commercial components:</P>
                            <P>(i) 10 U.S.C. 4654(d), Subcontractor Reports Under Prohibition Against Doing Business with Certain Offerors (see FAR 52.209-6).</P>
                            <P>(ii) 10 U.S.C. 4655, Prohibition on Limiting Subcontractor Direct Sales to the United States (see FAR 3.503 and 52.203-6).</P>
                            <P>(iii) 10 U.S.C. 4864, Miscellaneous Limitations on the Procurement of Goods Other Than United States Goods. 10 U.S.C. 4864 is not applicable to subcontracts at any tier valued at or below the simplified acquisition threshold.</P>
                            <CITA>[60 FR 61595, Nov. 30, 1995, as amended at 61 FR 58488, Nov. 15, 1996; 62 FR 5780, Feb. 7, 1997; 65 FR 14401, Mar. 16, 2000; 65 FR 39704, June 27, 2000; 65 FR 77828, Dec. 13, 2000; 69 FR 63331, Nov. 1, 2004; 73 FR 76970, Dec. 18, 2008; 75 FR 27947, May 19, 2010; 76 FR 38048, June 29, 2011; 76 FR 58146, Sept. 20, 2011; 76 FR 76319, Dec. 7, 2011; 87 FR 52341, Aug. 25, 2022; 87 FR 76991, Dec. 16, 2022; 88 FR 6582, Jan. 31, 2023; 88 FR 25512, Apr. 27, 2023; 88 FR 46902, July 20, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>212.505</SECTNO>
                            <SUBJECT>Applicability of certain laws to contracts for the acquisition of COTS items.</SUBJECT>
                            <P>
                                Commercially available off-the-shelf (COTS) items are a subset of commercial products. Therefore, any laws listed at FAR 12.503, FAR 12.504, 212.503, or 212.504 are also not applicable or modified in their applicability to contracts 
                                <PRTPAGE P="94"/>
                                for the acquisition of COTS items. In addition to the laws listed at FAR 12.505 as specifically not applicable to COTS items, the following laws are not applicable to contracts for the acquisition of COTS items:
                            </P>
                            <P>(1) 10 U.S.C. 391, Reporting on Cyber Incidents with Respect to Networks and Information Systems of Operationally Critical Contractors and Certain Other Contractors, and 10 U.S.C. 393, Reporting on Penetrations of Networks and Information Systems of Certain Contractors.</P>
                            <P>(2) Paragraph (a)(1) of 10 U.S.C. 4863, Requirement to buy strategic materials critical to national security from American sources, except as provided at 225.7003-3(b)(2)(i).</P>
                            <P>(3) Paragraph (a)(1) of 10 U.S.C. 4872, Prohibition on acquisition of sensitive materials from non-allied foreign nations, except as provided at 225.7018-3(c)(1).</P>
                            <CITA>[88 FR 80465, Nov. 17, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 212.6—Streamlined Procedures for Evaluation and Solicitation for Commercial Products and Commercial Services</HD>
                        <SECTION>
                            <SECTNO>212.602</SECTNO>
                            <SUBJECT>Streamlined evaluation of offers.</SUBJECT>
                            <P>(b)(i) For the acquisition of transportation and transportation-related services, also consider evaluating offers in accordance with the criteria at 247.206(1).</P>
                            <P>(ii) For the acquisition of transportation in supply contracts that will include a significant requirement for transportation of items outside the contiguous United States, also evaluate offers in accordance with the criterion at 247.301-71.</P>
                            <P>(iii) For the direct purchase of ocean transportation services, also evaluate offers in accordance with the criteria at 247.573-2(c).</P>
                            <CITA>[65 FR 50143, Aug. 17, 2000, as amended at 70 FR 35544, June 21, 2005; 72 FR 49205, Aug. 28, 2007]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 212.70—Defense Commercial Solutions Opening</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>88 FR 55939, Aug. 17, 2023, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>212.7000</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>This subpart implements 10 U.S.C. 3458 for the acquisition of innovative commercial products or commercial services through the use of a general solicitation known as a commercial solutions opening (CSO).</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>212.7001</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <P>As used in this subpart—</P>
                            <P>
                                <E T="03">Innovative</E>
                                 means—
                            </P>
                            <P>(1) Any technology, process, or method, including research and development, that is new as of the date of submission of a proposal; or</P>
                            <P>(2) Any application that is new as of the date of submission of a proposal of a technology, process, or method existing as of such date.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>212.7002</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(a) Contracting officers may only use a CSO—</P>
                            <P>(1) To obtain innovative solutions or potential capabilities that fulfill requirements;</P>
                            <P>(2) To close capability gaps, or provide potential innovative technological advancements; and</P>
                            <P>(3) When meaningful proposals with varying technical or scientific approaches can be reasonably anticipated.</P>
                            <P>(b) Notwithstanding FAR 12.207, contracting officers shall use fixed-price type contracts, including fixed-price incentive contracts, for awards resulting from a CSO. When using a fixed-price incentive contract, see FAR 12.214 and subpart 16.4 for additional requirements.</P>
                            <P>(c) Contracting officers shall treat products and services acquired using a CSO as commercial products or commercial services.</P>
                            <P>
                                (d) When using a CSO to acquire research and development, contracting officers shall use the procedures of this subpart in conjunction with FAR part 35 and part 235. A CSO is not subject to the limitations at 235.016 and may be used to fulfill requirements for research and development, ranging from 
                                <PRTPAGE P="95"/>
                                advanced component development through operational systems development.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>212.7003</SECTNO>
                            <SUBJECT>Limitations.</SUBJECT>
                            <P>Contracting officers shall follow the procedures at PGI 212.7003 to obtain senior procurement executive approval to award a contract in excess of $100 million resulting from a CSO.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>212.7004</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>This section prescribes procedures for the use of a CSO.</P>
                            <P>(a) The CSO shall—</P>
                            <P>(1) Describe the agency's interest for an individual program requirement or for broadly defined areas of interest covering the full range of the agency's requirements;</P>
                            <P>(2) Specify the technical data required that may be necessary to meet DoD's minimum requirements (see 227.7102 and 227.7202);</P>
                            <P>(3) Describe the evaluation factors for selecting proposals to include—</P>
                            <P>(i) Technical and importance to agency programs as the primary evaluation factors;</P>
                            <P>(ii) Price to the extent appropriate, but at a minimum to determine that the price is fair and reasonable; and</P>
                            <P>(iii) Relative importance of the factors, and the method of evaluation;</P>
                            <P>(4) Specify the period of time during which proposals submitted in response to the CSO will be accepted; and</P>
                            <P>(5) Contain instructions for the preparation and submission of proposals.</P>
                            <P>(b) The contracting officer shall publicize the CSO through the Governmentwide point of entry and, if authorized pursuant to FAR subpart 5.5, may also publish a notice regarding the CSO in noted scientific, technical, or engineering periodicals. The contracting officer shall publish the notice at least annually.</P>
                            <P>(c) Proposals received in response to the CSO shall be evaluated in accordance with evaluation factors specified therein through a scientific, technological, or other subject-matter expert peer review process. Written evaluation reports on individual proposals are required, but proposals need not be evaluated against each other since they are not submitted in response to a common performance work statement or statement of work.</P>
                            <P>(d) Synopsis of proposed contract actions under FAR subpart 5.2 of individual contract actions based upon proposals received in response to the CSO is not required. The notice published pursuant to paragraph (b) of this section fulfills the synopsis requirement.</P>
                            <P>(e) When a small business concern would otherwise be selected for award but is considered not responsible, follow the Small Business Administration Certificate of Competency procedure (see FAR subpart 19.6).</P>
                            <P>(f) The contracting officer shall document the decision that the requirements of this subpart have been met and include the documentation in the contract file.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>212.7005</SECTNO>
                            <SUBJECT>Congressional notification.</SUBJECT>
                            <P>See PGI 212.7005 for congressional notification requirements for contracts valued at more than $100 million that are awarded pursuant to a CSO.</P>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <RESERVED>Subpart 212.71 [Reserved]</RESERVED>
                    </SUBPART>
                </PART>
            </SUBCHAP>
            <SUBCHAP TYPE="P">
                <PRTPAGE P="96"/>
                <HD SOURCE="HED">SUBCHAPTER C—CONTRACTING METHODS AND CONTRACT TYPES</HD>
                <PART>
                    <EAR>Pt. 213</EAR>
                    <HD SOURCE="HED">PART 213—SIMPLIFIED ACQUISITION PROCEDURES</HD>
                    <CONTENTS>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 213.1—Procedures</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>213.101</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>213.104</SECTNO>
                            <SUBJECT>Promoting competition.</SUBJECT>
                            <SECTNO>213.106-1</SECTNO>
                            <SUBJECT>Soliciting competition.</SUBJECT>
                            <SECTNO>213.106-1-70</SECTNO>
                            <SUBJECT>Soliciting competition—tiered evaluation of offers.</SUBJECT>
                            <SECTNO>213.106-2</SECTNO>
                            <SUBJECT>Evaluation of quotations or offers.</SUBJECT>
                            <SECTNO>213.106-2-70</SECTNO>
                            <SUBJECT>Solicitation provision.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 213.2—Actions at or Below the Micro-Purchase Threshold</HD>
                            <SECTNO>213.201</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>213.270</SECTNO>
                            <SUBJECT>Use of the Governmentwide commercial purchase card.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 213.3—Simplified Acquisition Methods</HD>
                            <SECTNO>213.301</SECTNO>
                            <SUBJECT>Governmentwide commercial purchase card.</SUBJECT>
                            <SECTNO>213.302</SECTNO>
                            <SUBJECT>Purchase orders.</SUBJECT>
                            <SECTNO>213.302-3</SECTNO>
                            <SUBJECT>Obtaining contractor acceptance and modifying purchase orders.</SUBJECT>
                            <SECTNO>213.302-5</SECTNO>
                            <SUBJECT>Clauses.</SUBJECT>
                            <SECTNO>213.303</SECTNO>
                            <SUBJECT>Blanket purchase agreements (BPAs).</SUBJECT>
                            <SECTNO>213.303-5</SECTNO>
                            <SUBJECT>Purchases under BPAs.</SUBJECT>
                            <SECTNO>213.305</SECTNO>
                            <SUBJECT>Imprest funds and third party drafts.</SUBJECT>
                            <SECTNO>213.305-3</SECTNO>
                            <SUBJECT>Conditions for use.</SUBJECT>
                            <SECTNO>213.306</SECTNO>
                            <SUBJECT>SF 44, Purchase Order-Invoice-Voucher.</SUBJECT>
                            <SECTNO>213.307</SECTNO>
                            <SUBJECT>Forms.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 213.4—Fast Payment Procedure</HD>
                            <SECTNO>213.402</SECTNO>
                            <SUBJECT>Conditions for use.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 213.5—Simplified Procedures for Certain Commercial Products and Commercial Services</HD>
                            <SECTNO>213.500-70</SECTNO>
                            <SUBJECT>Only one offer.</SUBJECT>
                            <SECTNO>213.501</SECTNO>
                            <SUBJECT>Special documentation requirement.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 213.70—Simplified Acquisition Procedures Under the 8(a) Program</HD>
                            <SECTNO>213.7001</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>213.7002</SECTNO>
                            <SUBJECT>Purchase orders.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>64 FR 2596, Jan. 15, 1999, unless otherwise noted.</P>
                    </SOURCE>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 213.1—Procedures</HD>
                        <SECTION>
                            <SECTNO>213.101</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>
                                Structure awards valued above the micro-purchase threshold (
                                <E T="03">e.g.,</E>
                                 contract line items, delivery schedule, and invoice instructions) in a manner that will minimize the generation of invoices valued at or below the micro-purchase threshold.
                            </P>
                            <CITA>[65 FR 46625, July 31, 2000]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>213.104</SECTNO>
                            <SUBJECT>Promoting competition.</SUBJECT>
                            <P>For information on the various approaches that may be used to competitively fulfill DoD requirements, see PGI 213.104.</P>
                            <CITA>[80 FR 21657, Apr. 20, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>213.106-1</SECTNO>
                            <SUBJECT>Soliciting competition.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Considerations.</E>
                            </P>
                            <P>(2)(i) Include an evaluation factor regarding supply chain risk (see subpart 239.73) when acquiring information technology, whether as a service or as a supply, that is a covered system, is a part of a covered system, or is in support of a covered system, as defined in 239.7301.</P>
                            <P>(ii) See 215.101-2-70 for limitations and prohibitions on the use of the lowest price technically acceptable source selection process, which are applicable to simplified acquisitions.</P>
                            <P>(iii) See 217.7801 for the prohibition on the use of reverse auctions for personal protective equipment and aviation critical safety items.</P>
                            <CITA>[84 FR 50788, Sept. 26, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>213.106-1-70</SECTNO>
                            <SUBJECT>Soliciting competition—tiered evaluation of offers.</SUBJECT>
                            <P>See limitations on the use of tiered evaluation of offers at 215.203-70.</P>
                            <CITA>[72 FR 42314, Aug. 2, 2007]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>213.106-2</SECTNO>
                            <SUBJECT>Evaluation of quotations or offers.</SUBJECT>
                            <P>
                                (b)(i) See 204.7603 for procedures on the requirement for contracting officers to consider Supplier Performance 
                                <PRTPAGE P="97"/>
                                Risk System risk assessments as a basis of award.
                            </P>
                            <CITA>[88 FR 17339, Mar. 22, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>213.106-2-70</SECTNO>
                            <SUBJECT>Solicitation provision.</SUBJECT>
                            <P>Use the provision at 252.204-7024, Notice on the Use of the Supplier Performance Risk System, as prescribed in 204.7604.</P>
                            <CITA>[88 FR 17339, Mar. 22, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 213.2—Actions at or Below the Micro-Purchase Threshold</HD>
                        <SECTION>
                            <SECTNO>213.201</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>(f) Notwithstanding FAR 13.201(f), apply the prohibition at 223.7402 to purchases at or below the micro-purchase threshold.</P>
                            <P>(g) See PGI 213.201(g) for guidance on use of the higher micro-purchase thresholds prescribed in FAR 13.201(g) to support a declared contingency operation or to facilitate defense against or recovery from nuclear, biological, chemical, or radiological attack.</P>
                            <P>(j) Do not procure or obtain, or extend or renew a contract to procure or obtain, any equipment, system, or service to carry out covered missions that use covered defense telecommunications equipment or services as a substantial or essential component of any system, or as critical technology as part of any system, unless a waiver is granted. (See subpart 204.21.)</P>
                            <CITA>[81 FR 53045, Aug. 11, 2016, as amended at 84 FR 72237, Dec. 31, 2019; 88 FR 67606, Sept. 29, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>213.270</SECTNO>
                            <SUBJECT>Use of the Governmentwide commercial purchase card.</SUBJECT>
                            <P>Use the Governmentwide commercial purchase card as the method of purchase and/or method of payment for purchases valued at or below the micro-purchase threshold. This policy applies to all types of contract actions authorized by the FAR unless—</P>
                            <P>(a) The Deputy Secretary of Defense has approved an exception for an electronic commerce/electronic data interchange system or operational requirement that results in a more cost-effective payment process;</P>
                            <P>(b)(1) A general or flag officer or a member of the Senior Executive Service (SES) makes a written determination that—</P>
                            <P>(i) The source or sources available for the supply or service do not accept the purchase card; and</P>
                            <P>(ii) The contracting office is seeking a source that accepts the purchase card.</P>
                            <P>(2) To prevent mission delays, if an activity does not have a resident general or flag officer of SES member, delegation of this authority to the level of the senior local commander or director is permitted; or</P>
                            <P>(c) The purchase or payment meets one or more of the following criteria:</P>
                            <P>(1) The place of performance is entirely outside the United States and its outlying areas.</P>
                            <P>(2) The purchase is a Standard Form 44 purchase for aviation fuel or oil.</P>
                            <P>(3) The purchase is an overseas transaction by a contracting officer in support of a contingency operation as defined in 10 U.S.C. 101(a)(13) or a humanitarian or peacekeeping operation as defined in 10 U.S.C. 3015(2).</P>
                            <P>(4) The purchase is a transaction in support of intelligence or other specialized activities addressed by Part 2.7 of Executive Order 12333.</P>
                            <P>(5) The purchase is for training exercises in preparation for overseas contingency, humanitarian, or peacekeeping operations.</P>
                            <P>(6) The payment is made with an accommodation check.</P>
                            <P>(7) The payment is for a transportation bill.</P>
                            <P>(8) The purchase is under a Federal Supply Schedule contract that does not permit use of the Governmentwide commercial purchase card.</P>
                            <P>(9) The purchase is for medical services and—</P>
                            <P>(i) It involves a controlled substance or narcotic;</P>
                            <P>(ii) It requires the submission of a Health Care Summary Record to document the nature of the care purchased;</P>
                            <P>
                                (iii) The ultimate price of the medical care is subject to an independent determination that changes the price paid based on application of a mandatory CHAMPUS Maximum Allowable Charge determination that reduces the 
                                <PRTPAGE P="98"/>
                                Government liability below billed charges;
                            </P>
                            <P>(iv) The Government already has entered into a contract to pay for the services without the use of a purchase card;</P>
                            <P>(v) The purchaser is a beneficiary seeking medical care; or</P>
                            <P>(vi) The senior local commander or director of a hospital or laboratory determines that use of the purchase card is not appropriate or cost-effective. The Medical Prime Vendor Program and the DoD Medical Electronic Catalog Program are two examples where use of the purchase card may not be cost-effective.</P>
                            <CITA>[65 FR 46626, July 31, 2000, as amended at 70 FR 35544, June 21, 2005; 87 FR 76992, Dec. 16, 2022]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 213.3—Simplified Acquisition Methods</HD>
                        <SECTION>
                            <SECTNO>213.301</SECTNO>
                            <SUBJECT>Governmentwide commercial purchase card.</SUBJECT>
                            <P>Follow the procedures at PGI 213.301 for authorizing, establishing, and operating a Governmentwide commercial purchase card program.</P>
                            <P>(1) “United States,” as used in this section, means the 50 States and the District of Columbia, the Commonwealth of Puerto Rico, the Virgin Islands, the Commonwealth of the Northern Mariana Islands, Guam, American Samoa, Wake Island, Johnston Island, Canton Island, the outer Continental Shelf, and any other place subject to the jurisdiction of the United States (but not including leased bases).</P>
                            <P>(2) An individual appointed in accordance with 201.603-3(a) also may use the Governmentwide commercial purchase card to make a purchase that exceeds the micro-purchase threshold but does not exceed $25,000, if—</P>
                            <P>(i) The purchase—</P>
                            <P>(A) Is made outside the United States for use outside the United States; and</P>
                            <P>(B) Is for a commercial product or commercial service; but</P>
                            <P>(C) Is not for work to be performed by employees recruited within the United States;</P>
                            <P>(D) Is not for supplies or services originating from, or transported from or through, sources identified in FAR Subpart 25.7;</P>
                            <P>(E) Is not for ball or roller bearings as end items;</P>
                            <P>(F) Does not require access to classified or Privacy Act information; and</P>
                            <P>(G) Does not require transportation of supplies by sea; and</P>
                            <P>(ii) The individual making the purchase—</P>
                            <P>(A) Is authorized and trained in accordance with agency procedures;</P>
                            <P>(B) Complies with the requirements of FAR 8.002 in making the purchase; and</P>
                            <P>(C) Seeks maximum practicable competition for the purchase in accordance with FAR 13.104(b).</P>
                            <P>(3) A contracting officer supporting a contingency operation as defined in 10 U.S.C. 101(a)(13) or a humanitarian or peacekeeping operation as defined in 10 U.S.C. 3015(2) also may use the Governmentwide commercial purchase card to make a purchase that exceeds the micro-purchase threshold but does not exceed the simplified acquisition threshold, if—</P>
                            <P>(i) The supplies or services being purchased are immediately available;</P>
                            <P>(ii) One delivery and one payment will be made; and</P>
                            <P>(iii) The requirements of paragraphs (2)(i) and (ii) of this section are met.</P>
                            <P>(4) The contracting officer shall not authorize the Governmentwide commercial purchase card as a method of payment during any contract period of performance if the contract includes the clause at FAR 52.229-12, Tax on Certain Foreign Procurements, unless the contract also includes the clause at 252.229-7014, Full Exemption from Two-Percent Excise Tax on Certain Foreign Procurements, indicating that the contractor is fully exempt from the tax.</P>
                            <P>
                                (5) Guidance on DoD purchase, travel, and fuel card programs is available in the “Department of Defense Government Charge Card Guidebook for Establishing and Managing Purchase, Travel, and Fuel Card Programs” at 
                                <E T="03">https://www.acq.osd.mil/asda/dpc/ce/pc/docs-guides.html. </E>
                                 Additional guidance on the fuel card programs is available at 
                                <E T="03">https://www.dla.mil/Energy/Offers/Products/GovernmentFuel/.</E>
                            </P>
                            <P>
                                (6) When the Governmentwide commercial purchase card is used as a method of payment for contracts or orders, follow the procedures at 
                                <PRTPAGE P="99"/>
                                232.7002(a)(5) and PGI 242.302(a)(13)(B)(
                                <E T="03">3</E>
                                ).
                            </P>
                            <CITA>[64 FR 56705, Oct. 21, 1999; 64 FR 63380, Nov. 19, 1999]</CITA>
                            <EDNOTE>
                                <HD SOURCE="HED">Editorial Note:</HD>
                                <P>
                                    For 
                                    <E T="04">Federal Register</E>
                                     citations affecting section 213.301, see the List of CFR Sections Affected, which appears in the Finding Aids section of the printed volume and at 
                                    <E T="03">www.govinfo.gov.</E>
                                </P>
                            </EDNOTE>
                        </SECTION>
                        <SECTION>
                            <SECTNO>213.302</SECTNO>
                            <SUBJECT>Purchase orders.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>213.302-3</SECTNO>
                            <SUBJECT>Obtaining contractor acceptance and modifying purchase orders.</SUBJECT>
                            <P>(1) Require written acceptance of purchase orders for classified acquisitions.</P>
                            <P>(2) See PGI 213.302-3 for guidance on the use of unilateral modifications.</P>
                            <P>(3) A supplemental agreement converts a unilateral purchase order to a bilateral agreement. If not previously included in the purchase order, incorporate the clause at 252.243-7001, Pricing of Contract Modifications, in the Standard Form 30, and obtain the contractor's acceptance by signature on the Standard Form 30.</P>
                            <CITA>[64 FR 2596, Jan. 15, 1999, as amended at 71 FR 3413, Jan. 23, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>213.302-5</SECTNO>
                            <SUBJECT>Clauses.</SUBJECT>
                            <P>(a) Use the clause at 252.243-7001, Pricing of Contract Modifications, in all bilateral purchase orders.</P>
                            <P>(d) When using the clause at FAR 52.213-4, delete the reference to the clause at FAR 52.225-1, Buy American—Supplies. Instead, if the Buy American statute applies to the acquisition, use the clause at—</P>
                            <P>(i) 252.225-7001, Buy American and Balance of Payments Program, or the appropriate alternate, as prescribed at 225.1101(2); or</P>
                            <P>(ii) 252.225-7036, Buy American—Free Trade Agreements—Balance of Payments Program, or the appropriate alternate, as prescribed at 225.1101(10).</P>
                            <CITA>[64 FR 24528, May 7, 1999, as amended at 65 FR 19850, Apr. 13, 2000; 65 FR 39704, June 27, 2000; 68 FR 56561, Oct. 1, 2003; 69 FR 1927, Jan. 13, 2004; 77 FR 35880, June 15, 2012; 89 FR 11953, Feb. 15, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>213.303</SECTNO>
                            <SUBJECT>Blanket purchase agreements (BPAs).</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>213.303-5</SECTNO>
                            <SUBJECT>Purchases under BPAs.</SUBJECT>
                            <P>(b) Individual purchases for subsistence may be made at any dollar value; however, the contracting officer must satisfy the competition requirements of FAR Part 6 for any action not using simplified acquisition procedures.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>213.305</SECTNO>
                            <SUBJECT>Imprest funds and third party drafts.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>213.305-3</SECTNO>
                            <SUBJECT>Conditions for use.</SUBJECT>
                            <P>(d)(i) On a very limited basis, installation commanders and commanders of other activities with contracting authority may be granted authority to establish imprest funds and third party draft (accommodation check) accounts. Use of imprest funds and third party drafts must comply with—</P>
                            <P>(A) DoD 7000.14-R, DoD Financial Management Regulation, Volume 5, Disbursing Policy and Procedures; and</P>
                            <P>(B) The Treasury Financial Manual, Volume I, Part 4, Chapter 3000.</P>
                            <P>(ii) Use of imprest funds requires approval by the Director for Financial Commerce, Office of the Deputy Chief Financial Officer, Office of the Under Secretary of Defense (Comptroller), except as provided in paragraph (d)(iii) of this subsection.</P>
                            <P>(iii) Imprest funds are authorized for use without further approval for—</P>
                            <P>(A) Overseas transactions at or below the micro-purchase threshold in support of a contingency operation as defined in 10 U.S.C. 101(a)(13) or a humanitarian or peacekeeping operation as defined in 10 U.S.C. 3015(2); and</P>
                            <P>(B) Classified transactions.</P>
                            <CITA>[71 FR 3413, Jan. 23, 2006, as amended at 87 FR 76992, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>213.306</SECTNO>
                            <SUBJECT>SF 44, Purchase Order-Invoice-Voucher.</SUBJECT>
                            <P>(a)(1) The micro-purchase limitation applies to all purchases, except that purchases not exceeding the simplified acquisition threshold may be made for—</P>
                            <P>
                                (A) 
                                <E T="03">Fuel and oil.</E>
                                 U.S. Government fuel cards may be used in lieu of an SF 44 for fuel, oil, and authorized refueling-related items (see PGI 213.306 for procedures on use of fuel cards);
                                <PRTPAGE P="100"/>
                            </P>
                            <P>(B) Overseas transactions by contracting officers in support of a contingency operation as defined in 10 U.S.C. 101(a)(13) or a humanitarian or peacekeeping operation as defined in 10 U.S.C. 3015(2); and</P>
                            <P>(C) Transactions in support of intelligence and other specialized activities addressed by Part 2.7 of Executive Order 12333.</P>
                            <CITA>[64 FR 2596, Jan. 15, 1999, as amended at 71 FR 3413, Jan. 23, 2006; 72 FR 6484, Feb. 12, 2007; 76 FR 58150, Sept. 20, 2011; 87 FR 76992, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>213.307</SECTNO>
                            <SUBJECT>Forms.</SUBJECT>
                            <P>See PGI 213.307 for procedures on use of forms for purchases made using simplified acquisition procedures.</P>
                            <CITA>[71 FR 3413, Jan. 23, 2006]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 213.4—Fast Payment Procedure</HD>
                        <SECTION>
                            <SECTNO>213.402</SECTNO>
                            <SUBJECT>Conditions for use.</SUBJECT>
                            <P>(a) Individual orders may exceed the simplified acquisition threshold for—</P>
                            <P>(i) Brand-name commercial product commissary resale subsistence; and</P>
                            <P>(ii) Medical supplies for direct shipment overseas.</P>
                            <CITA>[64 FR 2596, Jan. 15, 1999, as amended at 88 FR 6582, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 213.5—Simplified Procedures for Certain Commercial Products and Commercial Services</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>80 FR 21657, Apr. 20, 2015, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>213.500-70</SECTNO>
                            <SUBJECT>Only one offer.</SUBJECT>
                            <P>If only one offer is received in response to a competitive solicitation issued using simplified acquisition procedures authorized under FAR subpart 13.5, follow the procedures at 215.371-2.</P>
                            <CITA>[80 FR 21657, Apr. 20, 2015, as amended at 80 FR 36718, June 26, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>213.501</SECTNO>
                            <SUBJECT>Special documentation requirements.</SUBJECT>
                            <P>
                                (a)(i) 
                                <E T="03">Sole source (including brand name) acquisitions.</E>
                                 For noncompetitive follow-on acquisitions of supplies or services previously awarded on a noncompetitive basis, include the additional documentation required by PGI 206.303-2(b)(i) and follow the procedures at PGI 206.304(a)(S-70).
                            </P>
                            <P>(ii) In accordance with section 888(a) of the National Defense Authorization Act for Fiscal Year 2017 (Pub. L. 114-328), the justification and approval addressed in FAR 13.501(a) is required in order to use brand name or equal descriptions or proprietary specifications and standards.</P>
                            <CITA>[80 FR 21657, Apr. 20, 2015, as amended at 84 FR 25192, May 31, 2019]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 213.70—Simplified Acquisition Procedures Under the 8(a) Program</HD>
                        <SECTION>
                            <SECTNO>213.7001</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>(a)(1) For acquisitions that are otherwise appropriate to be conducted using procedures set forth in this part, and also eligible for the 8(a) Program, contracting officers may use—</P>
                            <P>(i) For sole source purchase orders not exceeding the simplified acquisition threshold, the procedures in PGI 219.804-2(2); or</P>
                            <P>(ii) For other types of acquisitions, the procedures in PGI 219.8, excluding the procedures in PGI 219.804-2(2); or</P>
                            <P>(2) The procedures for award to the Small Business Administration in FAR subpart 19.8.</P>
                            <P>(b) To comply with section 898 of the National Defense Authorization Act for Fiscal Year 2016 (Pub. L. 114-92), contracting officers shall not use the sole source authority at FAR 6.302-5(b)(4) to purchase religious-related services to be performed on a U.S. military installation. For competitive purchases under the 8(a) program, contracting officers shall not exclude a nonprofit organization from the competition. See 219.270 for additional procedures.</P>
                            <CITA>[64 FR 2596, Jan. 15, 1999. Redesignated at 71 FR 3413, Jan. 23, 2006; 81 FR 65563, Sept. 23, 2016; 83 FR 16002, Apr. 13, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>213.7002</SECTNO>
                            <SUBJECT>Purchase orders.</SUBJECT>
                            <P>
                                The contracting officer need not obtain a contractor's written acceptance of a purchase order or modification of a purchase order for an acquisition under 
                                <PRTPAGE P="101"/>
                                the 8(a) Program pursuant to 219.804-2(2).
                            </P>
                            <CITA>[71 FR 3413, Jan. 23, 2006]</CITA>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 214</EAR>
                    <HD SOURCE="HED">PART 214—SEALED BIDDING</HD>
                    <CONTENTS>
                        <SECHD>Sec.</SECHD>
                        <SECTNO>214.201-5</SECTNO>
                        <SUBJECT>Part IV—Representations and instructions.</SUBJECT>
                        <SECTNO>214.201-6</SECTNO>
                        <SUBJECT>Solicitation provisions.</SUBJECT>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 214.2—Solicitation of Bids</HD>
                            <SECTNO>214.202</SECTNO>
                            <SUBJECT>General rules for solicitation of bids.</SUBJECT>
                            <SECTNO>214.202-5</SECTNO>
                            <SUBJECT>Descriptive literature.</SUBJECT>
                            <SECTNO>214.209</SECTNO>
                            <SUBJECT>Cancellation of invitations before opening.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 214.4—Opening of Bids and Award of Contract</HD>
                            <SECTNO>214.404</SECTNO>
                            <SUBJECT>Rejection of bids.</SUBJECT>
                            <SECTNO>214.404-1</SECTNO>
                            <SUBJECT>Cancellation of invitations after opening.</SUBJECT>
                            <SECTNO>214.407</SECTNO>
                            <SUBJECT>Mistakes in bids.</SUBJECT>
                            <SECTNO>214.407-3</SECTNO>
                            <SUBJECT>Other mistakes disclosed before award.</SUBJECT>
                            <SECTNO>214.408</SECTNO>
                            <SUBJECT>Award.</SUBJECT>
                            <SECTNO>214.408-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 214.5—Two-Step Sealed Bidding</HD>
                            <SECTNO>214.503</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>214.503-1</SECTNO>
                            <SUBJECT>Step one.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36326, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 214.2—Solicitation of Bids</HD>
                        <SECTION>
                            <SECTNO>214.201-5</SECTNO>
                            <SUBJECT>Part IV—Representations and instructions.</SUBJECT>
                            <P>(c) Include an evaluation factor regarding supply chain risk (see subpart 239.73) when acquiring information technology, whether as a service or as a supply, that is a covered system, is a part of a covered system, or is in support of a covered system, as defined in 239.7301.</P>
                            <CITA>[80 FR 67251, Oct. 30, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>214.201-6</SECTNO>
                            <SUBJECT>Solicitation provisions.</SUBJECT>
                            <P>(2) Use the provisions at 252.215-7007, Notice of Intent to Resolicit, and 252.215-7008, Only One Offer, as prescribed at 215.371-6 and 215.408(3), respectively.</P>
                            <CITA>[77 FR 39138, June 29, 2012, as amended at 83 FR 30825, June 29, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>214.202</SECTNO>
                            <SUBJECT>General rules for solicitation of bids.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>214.202-5</SECTNO>
                            <SUBJECT>Descriptive literature.</SUBJECT>
                            <P>
                                (c) 
                                <E T="03">Requirements of invitation for bids.</E>
                                 When brand name or equal purchase descriptions are used, use of the provision at FAR 52.211-6, Brand Name or Equal, satisfies this requirement.
                            </P>
                            <CITA>[56 FR 36326, July 31, 1991, as amended at 63 FR 11528, Mar. 9, 1998; 64 FR 55633, Oct. 14, 1999; 69 FR 65090, Nov. 10, 2004]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>214.209</SECTNO>
                            <SUBJECT>Cancellation of invitations before opening.</SUBJECT>
                            <P>If an invitation for bids allowed fewer than 30 days for receipt of offers, and resulted in only one offer, the contracting officer shall cancel and resolicit, allowing an additional period of at least 30 days for receipt of offers, as provided in 215.371.</P>
                            <CITA>[77 FR 39138, June 29, 2012]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 214.4—Opening of Bids and Award of Contract</HD>
                        <SECTION>
                            <SECTNO>214.404</SECTNO>
                            <SUBJECT>Rejection of bids.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>214.404-1</SECTNO>
                            <SUBJECT>Cancellation of invitations after opening.</SUBJECT>
                            <P>(1) The contracting officer shall make the written determinations required by FAR 14.404-1(c) and (e)(1).</P>
                            <P>(2) If only one offer is received, follow the procedures at 215.371 in lieu of the procedures at FAR 14.404-1(f).</P>
                            <CITA>[77 FR 39138, June 29, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>214.407</SECTNO>
                            <SUBJECT>Mistakes in bids.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>214.407-3</SECTNO>
                            <SUBJECT>Other mistakes disclosed before award.</SUBJECT>
                            <P>(e) Authority for making a determination under FAR 14.407-3(a), (b) and (d) is delegated for the defense agencies, without power of redelegation, as follows:</P>
                            <P>(i) Defense Advanced Research Projects Agency: General Counsel, DARPA.</P>
                            <P>(ii) Defense Information Systems Agency: General Counsel, DISA.</P>
                            <P>(iii) Defense Intelligence Agency: Principal Assistant for Acquisition.</P>
                            <P>(iv) Defense Logistics Agency:</P>
                            <P>(A) General Counsel, DLA; and</P>
                            <P>
                                (B) Associate General Counsel, DLA.
                                <PRTPAGE P="102"/>
                            </P>
                            <P>(v) National Geospatial-Intelligence Agency: General Counsel, NGA.</P>
                            <P>(vi) Defense Threat Reduction Agency: General Counsel, DTRA.</P>
                            <P>(vii) National Security Agency: Director of Procurement, NSA.</P>
                            <P>(viii) Missile Defense Agency: General Counsel, MDA.</P>
                            <P>(ix) Defense Contract Management Agency: General Counsel, DCMA.</P>
                            <CITA>[57 FR 42629, Sept. 15, 1992, as amended at 59 FR 27669, May 27, 1994; 61 FR 50452, Sept. 26, 1996. Redesignated and amended at 62 FR 34122, June 24, 1997; 64 FR 51076, Sept. 21, 1999; 68 FR 7439, Feb. 14, 2003; 69 FR 65090, Nov. 10, 2004; 74 FR 42780, Aug. 25, 2009]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>214.408</SECTNO>
                            <SUBJECT>Award.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>214.408-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>(b) For acquisitions that exceed the simplified acquisition threshold, if only one offer is received, follow the procedures at 215.371.</P>
                            <CITA>[77 FR 39138, June 29, 2012]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 214.5—Two-Step Sealed Bidding</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>80 FR 67251, Oct. 30, 2015, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>214.503</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>214.503-1</SECTNO>
                            <SUBJECT>Step one.</SUBJECT>
                            <P>(a)(4) Include an evaluation factor regarding supply chain risk (see subpart 239.73) when acquiring information technology, whether as a service or as a supply, that is a covered system, is a part of a covered system, or is in support of a covered system, as defined in 239.7301.</P>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 215</EAR>
                    <HD SOURCE="HED">PART 215—CONTRACTING BY NEGOTIATION</HD>
                    <CONTENTS>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 215.1—Source Selection Processes and Techniques</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>215.101</SECTNO>
                            <SUBJECT>Best value continuum.</SUBJECT>
                            <SECTNO>215.101-2</SECTNO>
                            <SUBJECT>Lowest price technically acceptable source selection process.</SUBJECT>
                            <SECTNO>215.101-2-70</SECTNO>
                            <SUBJECT>Limitations and prohibitions.</SUBJECT>
                            <SECTNO>215.101-70</SECTNO>
                            <SUBJECT>Best value when acquiring tents or other temporary structures.</SUBJECT>
                            <SECTNO>215.101-71</SECTNO>
                            <SUBJECT>Tradeoff process when acquiring fuel for overseas contingency operations.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 215.2—Solicitation and Receipt of Proposals and Information</HD>
                            <SECTNO>215.203-70</SECTNO>
                            <SUBJECT>Requests for proposals—tiered evaluation of offers.</SUBJECT>
                            <SECTNO>215.209</SECTNO>
                            <SUBJECT>Solicitation provisions and contract clauses.</SUBJECT>
                            <SECTNO>215.270</SECTNO>
                            <SUBJECT>Peer Reviews.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 215.3—Source Selection</HD>
                            <SECTNO>215.300</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>215.303</SECTNO>
                            <SUBJECT>Responsibilities.</SUBJECT>
                            <SECTNO>215.304</SECTNO>
                            <SUBJECT>Evaluation factors and significant subfactors.</SUBJECT>
                            <SECTNO>215.305</SECTNO>
                            <SUBJECT>Proposal evaluation.</SUBJECT>
                            <SECTNO>215.306</SECTNO>
                            <SUBJECT>Exchanges with offerors after receipt of proposals.</SUBJECT>
                            <SECTNO>215.370</SECTNO>
                            <SUBJECT>Evaluation factor for employing or subcontracting with members of the Selected Reserve.</SUBJECT>
                            <SECTNO>215.370-1</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <SECTNO>215.370-2</SECTNO>
                            <SUBJECT>Evaluation factor.</SUBJECT>
                            <SECTNO>215.370-3</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <SECTNO>215.371</SECTNO>
                            <SUBJECT>Only one offer.</SUBJECT>
                            <SECTNO>215.371-1</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>215.371-2</SECTNO>
                            <SUBJECT>Promote competition.</SUBJECT>
                            <SECTNO>215.371-3</SECTNO>
                            <SUBJECT>Fair and reasonable price and the requirement for additional cost or pricing data.</SUBJECT>
                            <SECTNO>215.371-4</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <SECTNO>215.371-5</SECTNO>
                            <SUBJECT>Waiver.</SUBJECT>
                            <SECTNO>215.371-6</SECTNO>
                            <SUBJECT>Solicitation provision.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 215.4—Contract Pricing</HD>
                            <SECTNO>215.401</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>215.402</SECTNO>
                            <SUBJECT>Pricing policy.</SUBJECT>
                            <SECTNO>215.403</SECTNO>
                            <SUBJECT>Obtaining certified cost or pricing data.</SUBJECT>
                            <SECTNO>215.403-1</SECTNO>
                            <SUBJECT>Prohibition on obtaining certified cost or pricing data (10 U.S.C. chapter 271 and 41 U.S.C. chapter 35).</SUBJECT>
                            <SECTNO>215.403-3</SECTNO>
                            <SUBJECT>Requiring data other than certified cost or pricing data.</SUBJECT>
                            <SECTNO>215.403-5</SECTNO>
                            <SUBJECT>Instructions for submission of certified cost or pricing data and data other than certified cost or pricing data.</SUBJECT>
                            <SECTNO>215.404</SECTNO>
                            <SUBJECT>Proposal analysis.</SUBJECT>
                            <SECTNO>215.404-1</SECTNO>
                            <SUBJECT>Proposal analysis techniques.</SUBJECT>
                            <SECTNO>215.404-2</SECTNO>
                            <SUBJECT>Data to support proposal analysis.</SUBJECT>
                            <SECTNO>215.404-3</SECTNO>
                            <SUBJECT>Subcontract pricing considerations.</SUBJECT>
                            <SECTNO>215.404-4</SECTNO>
                            <SUBJECT>Profit.</SUBJECT>
                            <SECTNO>215.404-70</SECTNO>
                            <SUBJECT>DD Form 1547, Record of Weighted Guidelines Method Application.</SUBJECT>
                            <SECTNO>215.404-71</SECTNO>
                            <SUBJECT>Weighted guidelines method.</SUBJECT>
                            <SECTNO>215.404-71-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>215.404-71-2</SECTNO>
                            <SUBJECT>Performance risk.</SUBJECT>
                            <SECTNO>215.404-71-3</SECTNO>
                            <SUBJECT>Contract type risk and working capital adjustment.</SUBJECT>
                            <SECTNO>215.404-71-4</SECTNO>
                            <SUBJECT>Facilities capital employed.</SUBJECT>
                            <SECTNO>215.404-71-5</SECTNO>
                            <SUBJECT>Cost efficiency factor.</SUBJECT>
                            <SECTNO>215.404-72</SECTNO>
                            <SUBJECT>Modified weighted guidelines method for nonprofit organizations other than FFRDCs.</SUBJECT>
                            <SECTNO>215.404-73</SECTNO>
                            <SUBJECT>
                                Alternate structure approaches.
                                <PRTPAGE P="103"/>
                            </SUBJECT>
                            <SECTNO>215.404-74</SECTNO>
                            <SUBJECT>Fee requirements for cost-plus-award-fee contracts.</SUBJECT>
                            <SECTNO>215.404-75</SECTNO>
                            <SUBJECT>Fee requirements for FFRDCs.</SUBJECT>
                            <SECTNO>215.406</SECTNO>
                            <SUBJECT>Documentation.</SUBJECT>
                            <SECTNO>215.406-1</SECTNO>
                            <SUBJECT>Prenegotiation objectives.</SUBJECT>
                            <SECTNO>215.406-2</SECTNO>
                            <SUBJECT>Certificate of current cost or pricing data.</SUBJECT>
                            <SECTNO>215.406-3</SECTNO>
                            <SUBJECT>Documenting the negotiation.</SUBJECT>
                            <SECTNO>215.407</SECTNO>
                            <SUBJECT>Special cost or pricing areas.</SUBJECT>
                            <SECTNO>215.407-1</SECTNO>
                            <SUBJECT>Defective certified cost or pricing data.</SUBJECT>
                            <SECTNO>215.407-2</SECTNO>
                            <SUBJECT>Make-or-buy programs.</SUBJECT>
                            <SECTNO>215.407-3</SECTNO>
                            <SUBJECT>Forward pricing rate agreements.</SUBJECT>
                            <SECTNO>215.407-4</SECTNO>
                            <SUBJECT>Should-cost review.</SUBJECT>
                            <SECTNO>215.407-5</SECTNO>
                            <SUBJECT>Estimating systems.</SUBJECT>
                            <SECTNO>215.407-5-70</SECTNO>
                            <SUBJECT>Disclosure, maintenance, and review requirements.</SUBJECT>
                            <SECTNO>215.408</SECTNO>
                            <SUBJECT>Solicitation provisions and contract clauses.</SUBJECT>
                            <SECTNO>215.470</SECTNO>
                            <SUBJECT>Estimated data prices.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 215.5—Preaward, Award, and Postaward Notifications, Protests, and Mistakes</HD>
                            <SECTNO>215.503</SECTNO>
                            <SUBJECT>Notifications to unsuccessful offerors.</SUBJECT>
                            <SECTNO>215.506</SECTNO>
                            <SUBJECT>Postaward debriefing of offerors.</SUBJECT>
                            <SECTNO>215.506-70</SECTNO>
                            <SUBJECT>Opportunity for follow-up questions.</SUBJECT>
                            <SECTNO>215.570</SECTNO>
                            <SUBJECT>Solicitation provision.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 215.6—Unsolicited Proposals</HD>
                            <SECTNO>215.602</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>215.604</SECTNO>
                            <SUBJECT>Agency points of contact.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>63 FR 55040, Oct. 14, 1998, unless otherwise noted.</P>
                    </SOURCE>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 215.1—Source Selection Processes and Techniques</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>78 FR 13545, Feb. 28, 2013, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>215.101</SECTNO>
                            <SUBJECT>Best value continuum.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.101-2</SECTNO>
                            <SUBJECT>Lowest price technically acceptable source selection process.</SUBJECT>
                            <CITA>[84 FR 50788, Sept. 26, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.101-2-70</SECTNO>
                            <SUBJECT>Limitations and prohibitions.</SUBJECT>
                            <P>The following limitations and prohibitions apply when considering the use of the lowest price technically acceptable source selection procedures.</P>
                            <P>
                                (a) 
                                <E T="03">Limitations.</E>
                            </P>
                            <P>(1) In accordance with section 813 of the National Defense Authorization Act for Fiscal Year 2017 (Pub. L. 114-328) as amended by section 822 of the National Defense Authorization Act for Fiscal Year 2018 (Pub. L. 115-91) (see 10 U.S.C. 3241 note prec.), the lowest price technically acceptable source selection process shall only be used when—</P>
                            <P>(i) Minimum requirements can be described clearly and comprehensively and expressed in terms of performance objectives, measures, and standards that will be used to determine the acceptability of offers;</P>
                            <P>(ii) No, or minimal, value will be realized from a proposal that exceeds the minimum technical or performance requirements;</P>
                            <P>(iii) The proposed technical approaches will require no, or minimal, subjective judgment by the source selection authority as to the desirability of one offeror's proposal versus a competing proposal;</P>
                            <P>(iv) The source selection authority has a high degree of confidence that reviewing the technical proposals of all offerors would not result in the identification of characteristics that could provide value or benefit;</P>
                            <P>(v) No, or minimal, additional innovation or future technological advantage will be realized by using a different source selection process;</P>
                            <P>(vi) Goods to be procured are predominantly expendable in nature, are nontechnical, or have a short life expectancy or short shelf life (See PGI 215.101-2-70(a)(1)(vi) for assistance with evaluating whether a requirement satisfies this limitation);</P>
                            <P>(vii) The contract file contains a determination that the lowest price reflects full life-cycle costs (as defined at FAR 7.101) of the product(s) or service(s) being acquired (see PGI 215.101-2-70(a)(1)(vii) for information on obtaining this determination); and</P>
                            <P>(viii) The contracting officer documents the contract file describing the circumstances justifying the use of the lowest price technically acceptable source selection process.</P>
                            <P>
                                (2) In accordance with section 813 of the National Defense Authorization Act for Fiscal Year 2017, as amended by section 822 of the National Defense Authorization Act for Fiscal Year 2018 (Pub. L. 115-91) (see 10 U.S.C. 3241 note prec.), contracting officers shall avoid, to the maximum extent practicable, 
                                <PRTPAGE P="104"/>
                                using the lowest price technically acceptable source selection process in the case of a procurement that is predominately for the acquisition of—
                            </P>
                            <P>(i) Information technology services, cybersecurity services, systems engineering and technical assistance services, advanced electronic testing, or other knowledge-based professional services;</P>
                            <P>(ii) Items designated by the requiring activity as personal protective equipment (except see paragraph (b)(1) of this section); or</P>
                            <P>(iii) Services designated by the requiring activity as knowledge-based training or logistics services in contingency operations or other operations outside the United States, including in Afghanistan or Iraq.</P>
                            <P>
                                (b) 
                                <E T="03">Prohibitions.</E>
                            </P>
                            <P>(1) In accordance with section 814 of the National Defense Authorization Act for Fiscal Year 2017 (Pub. L. 114-328) as amended by section 882 of the National Defense Authorization Act for Fiscal Year 2018 (Pub. L. 115-91), contracting officers shall not use the lowest price technically acceptable source selection process to procure items designated by the requiring activity as personal protective equipment or an aviation critical safety item, when the requiring activity advises the contracting officer that the level of quality or failure of the equipment or item could result in combat casualties. See 252.209-7010 for the definition and identification of critical safety items.</P>
                            <P>(2) In accordance with section 832 of the National Defense Authorization Act for Fiscal Year 2018 (see 10 U.S.C. 4232), contracting officers shall not use the lowest price technically acceptable source selection process to acquire engineering and manufacturing development for a major defense acquisition program for which budgetary authority is requested beginning in fiscal year 2019.</P>
                            <P>(3) Contracting officers shall make award decisions based on best value factors and criteria, as determined by the resource sponsor (in accordance with agency procedures), for an auditing contract. The use of the lowest price technically acceptable source selection process is prohibited (10 U.S.C. 240f).</P>
                            <CITA>[84 FR 50788, Sept. 26, 2019, as amended at 87 FR 76992, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.101-70</SECTNO>
                            <SUBJECT>Best value when acquiring tents or other temporary structures.</SUBJECT>
                            <P>(a) In accordance with section 368 of the National Defense Authorization Act for Fiscal Year 2012 (Pub. L. 112-81), when acquiring tents or other temporary structures for use by the Armed Forces, the contracting officer shall award contracts that provide the best value. Temporary structures covered by this paragraph are nonpermanent buildings, including tactical shelters, nonpermanent modular or pre-fabricated buildings, or portable or relocatable buildings, such as trailers or equipment configured for occupancy (see also 246.270-2). Determination of best value includes consideration of the total life-cycle costs of such tents or structures, including the costs associated with any equipment, fuel, or electricity needed to heat, cool, or light such tents or structures (see FAR 7.105(a)(3)(i) and PGI 207.105(a)(3)(i)).</P>
                            <P>(b) The requirements of this section apply to any agency or department that acquires tents or other temporary structures on behalf of DoD (see FAR 17.503(d)(2)).</P>
                            <CITA>[78 FR 13545, Feb. 28, 2013]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.101-71</SECTNO>
                            <SUBJECT>Tradeoff process when acquiring fuel for overseas contingency operations.</SUBJECT>
                            <P>(a) When conducting a source selection for the acquisition of fuel that is for an overseas contingency operation and is expected to exceed the simplified acquisition threshold, the contracting officer shall consider using a tradeoff process in accordance with FAR 15.101-1 (section 843 of the National Defense Authorization Act for Fiscal Year 2022 (Pub. L. 117-81)). The contracting officer should consider using the following evaluation factors in any such tradeoff process:</P>
                            <P>(1) Past performance.</P>
                            <P>(2) Cost.</P>
                            <P>(3) Anticorruption training.</P>
                            <P>
                                (4) Anticorruption compliance.
                                <PRTPAGE P="105"/>
                            </P>
                            <P>(b) If a tradeoff process was not considered, prior to the issuance of the solicitation, the contracting officer shall justify in writing why a tradeoff process was not considered and obtain approval by an official one level above the contracting officer. This authority is not delegable. The contracting officer shall include the justification in the contract file.</P>
                            <CITA>[89 FR 78998, Sept. 26, 2024]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 215.2—Solicitation and Receipt of Proposals and Information</HD>
                        <SECTION>
                            <SECTNO>215.203-70</SECTNO>
                            <SUBJECT>Requests for proposals—tiered evaluation of offers.</SUBJECT>
                            <P>(a) The tiered or cascading order of precedence used for tiered evaluation of offers shall be consistent with FAR part 19.</P>
                            <P>
                                (b) Consideration shall be given to the tiers of small businesses (
                                <E T="03">e.g.</E>
                                , 8(a), HUBZone small business, service-disabled veteran-owned small business, small business) before evaluating offers from other than small business concerns.
                            </P>
                            <P>(c) The contracting officer is prohibited from issuing a solicitation with a tiered evaluation of offers unless—</P>
                            <P>(1) The contracting officer conducts market research, in accordance with FAR Part 10 and Part 210, to determine—</P>
                            <P>(i) Whether the criteria in FAR part 19 are met for setting aside the acquisition for small business; or</P>
                            <P>(ii) For a task or delivery order, whether there are a sufficient number of qualified small business concerns available to justify limiting competition under the terms of the contract; and</P>
                            <P>(2) If the contracting officer cannot determine whether the criteria in paragraph (c)(1) of this section are met, the contracting officer includes a written explanation in the contract file as to why such a determination could not be made (Section 816 of Public Law 109-163).</P>
                            <CITA>[71 FR 53043, Sept. 8, 2006, as amended at 72 FR 42314, Aug. 2, 2007]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.209</SECTNO>
                            <SUBJECT>Solicitation provisions and contract clauses.</SUBJECT>
                            <P>(a) For source selections when the procurement is $100 million or more, contracting officers should use the provision at FAR 52.215-1, Instructions to Offerors—Competitive Acquisition, with its Alternate I.</P>
                            <CITA>[76 FR 58152, Sept. 20, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.270</SECTNO>
                            <SUBJECT>Peer Reviews.</SUBJECT>
                            <P>Agency officials shall conduct Peer Reviews in accordance with 201.170.</P>
                            <CITA>[74 FR 37626, July 29, 2009]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 215.3—Source Selection</HD>
                        <SECTION>
                            <SECTNO>215.300</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>When conducting negotiated, competitive acquisitions utilizing FAR part 15 procedures, contracting officers shall follow the principles and procedures in the Director, Defense Pricing and Contracting memorandum provided at PGI 215.300.</P>
                            <CITA>[87 FR 52484, Aug. 26, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.303</SECTNO>
                            <SUBJECT>Responsibilities.</SUBJECT>
                            <P>(b)(2) For high-dollar value and other acquisitions, as prescribed by agency procedures, the source selection authority shall approve a source selection plan before the solicitation is issued. Follow the procedures at PGI 215.303(b)(2) for preparation of the source selection plan.</P>
                            <CITA>[71 FR 3414, Jan. 23, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.304</SECTNO>
                            <SUBJECT>Evaluation factors and significant subfactors.</SUBJECT>
                            <P>
                                (c)(i) In acquisitions that require use of the clause at FAR 52.219-9, Small Business Subcontracting Plan, other than those based on the lowest price technically acceptable source selection process (see FAR 15.101-2), the extent of participation of small businesses (to include service-disabled veteran-owned small business concerns, HUBZone small business concerns, small disadvantaged business concerns, and women-owned small business concerns) in performance of the contract shall be addressed in source selection. The contracting officer shall evaluate the extent to which offerors identify and commit to small business performance 
                                <PRTPAGE P="106"/>
                                of the contract, whether as a joint venture, teaming arrangement, or subcontractor.
                            </P>
                            <P>(A) See PGI 215.304(c)(i)(A) for examples of evaluation factors.</P>
                            <P>(B) Proposals addressing the extent of small business performance shall be separate from subcontracting plans submitted pursuant to the clause at FAR 52.219-9 and shall be structured to allow for consideration of offers from small businesses.</P>
                            <P>(C) When an evaluation assesses the extent that small businesses are specifically identified in proposals, the small businesses considered in the evaluation shall be listed in any subcontracting plan submitted pursuant to FAR 52.219-9 to facilitate compliance with 252.219-7003(e).</P>
                            <P>(ii) In accordance with 10 U.S.C. 4293, consider the purchase of capital assets (including machine tools) manufactured in the United States, in source selections for all major defense acquisition programs as defined in 10 U.S.C. 4201.</P>
                            <P>(iii) See 247.573-2(c) for additional evaluation factors required in solicitations for the direct purchase of ocean transportation services.</P>
                            <P>(iv) In accordance with section 812 of the National Defense Authorization Act for Fiscal Year 2011, consider the manufacturing readiness and manufacturing-readiness processes of potential contractors and subcontractors as a part of the source selection process for major defense acquisition programs.</P>
                            <P>(v) Include an evaluation factor regarding supply chain risk (see subpart 239.73) when acquiring information technology, whether as a service or as a supply, that is a covered system, is a part of a covered system, or is in support of a covered system, as defined in 239.7301. For additional guidance see PGI 215.304(c)(v).</P>
                            <P>(vi) Ensure source selections emphasize sustainment factors and objective reliability and maintainability evaluation criteria in competitive contracts for the—</P>
                            <P>
                                (A) Technical maturation and risk reduction phase of weapon system design (see guidance at PGI 207.105(b)(14)(ii)(
                                <E T="03">2</E>
                                ));
                            </P>
                            <P>(B) Engineering and manufacturing development phase of a weapon system, including embedded software (10 U.S.C. 4328); or</P>
                            <P>(C) Production and deployment phase of a weapon system, including embedded software (10 U.S.C. 4328).</P>
                            <P>(vii) See 226.7202 for an additional evaluation factor required in solicitations when using the Demonstration Project for Contractors Employing Persons with Disabilities.</P>
                            <P>(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.</P>
                            <P>(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.</P>
                            <CITA>[71 FR 3414, Jan. 23, 2006, as amended at 71 FR 14109, Mar. 21, 2006; 72 FR 49205, Aug. 28, 2007; 76 FR 38051, June 29, 2011; 78 FR 69270, Nov. 18, 2013; 79 FR 61581, Oct. 14, 2014; 80 FR 67251, Oct. 30, 2015; 84 FR 58333, Oct. 31, 2019; 84 FR 72560, Dec. 31, 2019; 87 FR 76992, Dec. 16, 2022; 88 FR 17339, Mar. 22, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.305</SECTNO>
                            <SUBJECT>Proposal evaluation.</SUBJECT>
                            <P>
                                (a)(2)(A) 
                                <E T="03">Past performance evaluation.</E>
                                 When a past performance evaluation is required by FAR 15.304, and the solicitation includes the clause at FAR 52.219-8, Utilization of Small Business Concerns, the evaluation factors shall include the past performance of offerors in complying with requirements of that clause. When a past performance evaluation is required by FAR 15.304, and the solicitation includes the clause at FAR 52.219-9, Small Business Subcontracting Plan, the evaluation factors shall include the past performance of offerors in complying with requirements of that clause.
                            </P>
                            <P>(B) Contracting officers shall consider an offeror's failure to make a good faith effort to comply with its comprehensive subcontracting plan under the Test Program described at 219.702-70 as part of the evaluation of the past performance.</P>
                            <CITA>[71 FR 3414, Jan. 23, 2006, as amended at 83 FR 15998, Apr. 13, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="107"/>
                            <SECTNO>215.306</SECTNO>
                            <SUBJECT>Exchanges with offerors after receipt of proposals.</SUBJECT>
                            <P>
                                (c) 
                                <E T="03">Competitive range.</E>
                            </P>
                            <P>(1) For acquisitions with an estimated value of $100 million or more, contracting officers should conduct discussions. Follow the procedures at FAR 15.306(c) and (d).</P>
                            <CITA>[76 FR 58152, Sept. 20, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.370</SECTNO>
                            <SUBJECT>Evaluation factor for employing or subcontracting with members of the Selected Reserve.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.370-1</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <P>As used in this section—</P>
                            <P>
                                <E T="03">Selected Reserve</E>
                                 has the meaning given that term in 10 U.S.C. 10143. Selected Reserve members normally attend regular drills throughout the year and are the group of Reserves most readily available to the President.
                            </P>
                            <CITA>[87 FR 15814, Mar. 18, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.370-2</SECTNO>
                            <SUBJECT>Evaluation factor.</SUBJECT>
                            <P>In accordance with Section 819 of the National Defense Authorization Act for Fiscal Year 2006 (Pub. L. 109-163), the contracting officer may use an evaluation factor that considers whether an offeror intends to perform the contract using employees or individual subcontractors who are members of the Selected Reserve. See PGI 215.370-2 for guidance on use of this evaluation factor.</P>
                            <CITA>[73 FR 62211, Oct. 20, 2008]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.370-3</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at 252.215-7006, Use of Employees or Individual Subcontractors Who Are Members of the Selected Reserve, in solicitations and resulting contracts that include an evaluation factor considering whether an offeror intends to perform the contract using employees or individual subcontractors who are members of the Selected Reserve.</P>
                            <CITA>[87 FR 15814, Mar. 18, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.371</SECTNO>
                            <SUBJECT>Only one offer.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.371-1</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>It is DoD policy, if only one offer is received in response to a competitive solicitation—</P>
                            <P>(a) To take the required actions to promote competition (see 215.371-2); and</P>
                            <P>(b) To ensure that the price is fair and reasonable (see 215.371-3) and to comply with the statutory requirement for certified cost or pricing data (see FAR 15.403-4).</P>
                            <CITA>[77 FR 39138, June 29, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.371-2</SECTNO>
                            <SUBJECT>Promote competition.</SUBJECT>
                            <P>Except as provided in sections 215.371-4 and 215.371-5—</P>
                            <P>(a) If only one offer is received when competitive procedures were used and the solicitation allowed fewer than 30 days for receipt of proposals, the contracting officer shall—</P>
                            <P>(1) Consult with the requiring activity as to whether the requirements document should be revised in order to promote more competition (see FAR 6.502(b) and 11.002); and</P>
                            <P>(2) Resolicit, allowing an additional period of at least 30 days for receipt of proposals; and</P>
                            <P>(b) For competitive solicitations in which more than one potential offeror expressed an interest in an acquisition, but only one offer was ultimately received, follow the procedures at PGI 215.371-2.</P>
                            <CITA>[80 FR 21657, Apr. 20, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.371-3</SECTNO>
                            <SUBJECT>Fair and reasonable price and the requirement for additional cost or pricing data.</SUBJECT>
                            <P>For acquisitions that exceed the simplified acquisition threshold, if only one offer is received when competitive procedures were used and it is not necessary to resolicit in accordance with 215.371-2(a), then then the contracting officer shall comply with the following:</P>
                            <P>(a) If no additional cost or pricing data are required to determine through cost or price analysis that the offered price is fair and reasonable, the contracting officer shall require that any cost or pricing data provided in the proposal be certified if the acquisition exceeds the certified cost or pricing data threshold and an exception to the requirement for certified cost or pricing data at FAR 15.403-1(b)(2) through (5) does not apply.</P>
                            <P>
                                (b) Otherwise, the contracting officer shall obtain additional cost or pricing 
                                <PRTPAGE P="108"/>
                                data to determine a fair and reasonable price. If the acquisition exceeds the certified cost or pricing data threshold and an exception to the requirement for certified cost or pricing data at FAR 15.403-1(b)(2) through (5) does not apply, the cost or pricing data shall be certified.
                            </P>
                            <P>(c) If the contracting officer is still unable to determine that the offered price is fair and reasonable, the contracting officer shall enter into negotiations with the offeror to establish a fair and reasonable price. The negotiated price should not exceed the offered price.</P>
                            <P>(d) If the contracting officer is unable to negotiate a fair and reasonable price, see FAR 15.405(d).</P>
                            <CITA>[84 FR 30949, June 28, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.371-4</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <P>(a) The requirements at section 215.371-2 do not apply to—</P>
                            <P>(1) Acquisitions at or below the simplified acquisition threshold;</P>
                            <P>(2) Acquisitions, as determined by the head of the contracting activity, in support of contingency or humanitarian or peacekeeping operations; to facilitate defense against or recovery from cyber, nuclear, biological, chemical, or radiological attack; to facilitate the provision of international disaster assistance; or to support response to an emergency or major disaster;</P>
                            <P>(3) Small business set-asides under FAR subpart 19.5, set asides offered and accepted into the 8(a) Program under FAR subpart 19.8, or set-asides under the HUBZone Program (see FAR 19.1305(c)), the Service-Disabled Veteran-Owned Small Business Procurement Program (see FAR 19.1405(c)), or the Women-Owned Small Business Program (see FAR 19.1505(d));</P>
                            <P>(4) Acquisitions of science and technology, as specified in 235.016(a);</P>
                            <P>(5) Acquisitions of architect-engineer services (see FAR 36.601-2); or</P>
                            <P>(6) Acquisitions under a commercial solutions opening pursuant to subpart 212.70.</P>
                            <P>(b) The applicability of an exception in paragraph (a) of this section does not eliminate the need for the contracting officer to seek maximum practicable competition and to ensure that the price is fair and reasonable.</P>
                            <CITA>[78 FR 65216, Oct. 31, 2013, as amended at 83 FR 24889, May 30, 2018; 84 FR 4365, Feb. 15, 2019; 88 FR 55940, Aug. 17, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.371-5</SECTNO>
                            <SUBJECT>Waiver.</SUBJECT>
                            <P>(a) The head of the contracting activity is authorized to waive the requirement at 215.371-2 to resolicit for an additional period of at least 30 days.</P>
                            <P>(b) This waiver authority cannot be delegated below one level above the contracting officer.</P>
                            <CITA>[77 FR 39138, June 29, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.371-6</SECTNO>
                            <SUBJECT>Solicitation provision.</SUBJECT>
                            <P>Use the provision at 252.215-7007, Notice of Intent to Resolicit, in competitive solicitations, including solicitations using FAR part 12 procedures for the acquisition of commercial products and commercial services, that will be solicited for fewer than 30 days, unless an exception at 215.371-4 applies or the requirement is waived in accordance with 215.371-5.</P>
                            <CITA>[78 FR 65216, Oct. 31, 2013, as amended at 88 FR 6582, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 215.4—Contract Pricing</HD>
                        <SECTION>
                            <SECTNO>215.401</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this subpart—</P>
                            <P>
                                <E T="03">Market prices</E>
                                 means current prices that are established in the course of ordinary trade between buyers and sellers free to bargain and that can be substantiated through competition or from sources independent of the offerors.
                            </P>
                            <P>
                                <E T="03">Relevant sales data</E>
                                 means information provided by an offeror of sales of the same or similar items that can be used to establish price reasonableness taking into consideration the age, volume, and nature of the transactions (including any related discounts, refunds, rebates, offsets, or other adjustments).
                            </P>
                            <CITA>[83 FR 4443, Jan. 31, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.402</SECTNO>
                            <SUBJECT>Pricing policy.</SUBJECT>
                            <P>
                                (a)(i) Pursuant to section 831 of the National Defense Authorization Act for Fiscal Year 2013 (Pub. L. 112-239)—
                                <PRTPAGE P="109"/>
                            </P>
                            <P>(A) The contracting officer is responsible for determining if the information provided by the offeror is sufficient to determine price reasonableness. This responsibility includes determining whether information on the prices at which the same or similar items have previously been sold is adequate for evaluating the reasonableness of price, and determining the extent of uncertified cost data that should be required in cases in which price information is not adequate;</P>
                            <P>(B) The contracting officer shall not limit the Government's ability to obtain any data that may be necessary to support a determination of fair and reasonable pricing by agreeing to contract terms that preclude obtaining necessary supporting information; and</P>
                            <P>(C) When obtaining uncertified cost data, the contracting officer shall require the offeror to provide the information in the form in which it is regularly maintained in the offeror's business operations.</P>
                            <P>(ii) Follow the procedures at PGI 215.402 when conducting cost or price analysis, particularly with regard to acquisitions for sole source commercial products or commercial services.</P>
                            <CITA>[72 FR 30278, May 31, 2007, as amended at 83 FR 4443, Jan. 31, 2018; 88 FR 6583, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.403</SECTNO>
                            <SUBJECT>Obtaining certified cost or pricing data.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.403-1</SECTNO>
                            <SUBJECT>Prohibition on obtaining certified cost or pricing data (10 U.S.C. chapter 271 and 41 U.S.C. chapter 35).</SUBJECT>
                            <P>
                                (b) 
                                <E T="03">Exceptions to certified cost or pricing data requirements.</E>
                                 (i) Follow the procedures at PGI 215.403-1(b).
                            </P>
                            <P>(ii) Submission of certified cost or pricing data shall not be required in the case of a contract, subcontract, or modification of a contract or subcontract to the extent such data relates to an indirect offset.</P>
                            <P>
                                (c) 
                                <E T="03">Standards for exceptions from certified cost or pricing data requirements</E>
                                —(1) 
                                <E T="03">Adequate price competition.</E>
                            </P>
                            <P>(A) For acquisitions under dual or multiple source programs—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) The determination of adequate price competition must be made on a case-by-case basis. Even when adequate price competition exists, in certain cases it may be appropriate to obtain additional data to assist in price analysis; and
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Adequate price competition normally exists when—
                            </P>
                            <P>
                                (
                                <E T="03">i</E>
                                ) Prices are solicited across a full range of step quantities, normally including a 0-100 percent split, from at least two offerors that are individually capable of producing the full quantity; and
                            </P>
                            <P>
                                (
                                <E T="03">ii</E>
                                ) The reasonableness of all prices awarded is clearly established on the basis of price analysis (see FAR 15.404-1(b)).
                            </P>
                            <P>(B) If only one offer is received in response to a competitive solicitation, see 215.371-3.</P>
                            <P>
                                (3) 
                                <E T="03">Commercial products or commercial services.</E>
                                (A) Follow the procedures at PGI 215.403-1(c)(3) for pricing commercial products or commercial services, except see 234.7002(e) for pricing commercial subsystems of major weapon systems and components and spare parts of major weapon systems and of subsystems of major weapon systems.
                            </P>
                            <P>(B) When applying the commercial item exception under FAR 15.403-1(b)(3), see 212.102(a)(ii) regarding prior commercial product or commercial service determinations.</P>
                            <P>
                                (4) 
                                <E T="03">Waivers.</E>
                                 (A) The head of the contracting activity may, without power of delegation, apply the exceptional circumstances authority when a determination is made that—
                            </P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) The property or services cannot reasonably be obtained under the contract, subcontract, or modification, without the granting of the waiver;
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) The price can be determined to be fair and reasonable without the submission of certified cost or pricing data; and
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) There are demonstrated benefits to granting the waiver. Follow the procedures at PGI 215.403-1(c)(4)(A) for determining when an exceptional case waiver is appropriate, for approval of such waivers, for partial waivers, and for waivers applicable to unpriced supplies or services.
                            </P>
                            <P>
                                (B) By November 30th of each year, departments and agencies shall provide a report to the Office of the Principal Director, Defense Pricing, Contracting, and Acquisition Policy, (Price, Cost and Finance), of all waivers granted 
                                <PRTPAGE P="110"/>
                                under FAR 15.403-1(b)(4), during the previous fiscal year, for any contract, subcontract, or modification expected to have a value of $20 million or more. See PGI 215.403-1(c)(4)(B) for the format and guidance for the report.
                            </P>
                            <P>(C) DoD has waived the requirement for submission of certified cost or pricing data for the Canadian Commercial Corporation and its subcontractors (but see 215.408(3) and 225.870-4(c)).</P>
                            <P>(D) DoD has waived certified cost or pricing data requirements for nonprofit organizations (including education institutions) on cost-reimbursement-no-fee contracts. The contracting officer shall require—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Submission of data other than certified cost or pricing data to the extent necessary to determine reasonableness and cost realism; and
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Certified cost or pricing data from subcontractors that are not nonprofit organizations when the subcontractor's proposal exceeds the certified cost or pricing data threshold at FAR 15.403-4(a)(1).
                            </P>
                            <CITA>[63 FR 55040, Oct. 14, 1998]</CITA>
                            <EDNOTE>
                                <HD SOURCE="HED">Editorial Note:</HD>
                                <P>
                                    For 
                                    <E T="04">Federal Register</E>
                                     citations affecting section 215.403-1, see the List of CFR Sections Affected, which appears in the Finding Aids section of the printed volume and at 
                                    <E T="03">www.govinfo.gov.</E>
                                </P>
                            </EDNOTE>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.403-3</SECTNO>
                            <SUBJECT>Requiring data other than certified cost or pricing data.</SUBJECT>
                            <P>Follow the procedures at PGI 215.403-3.</P>
                            <P>(a) In accordance with 10 U.S.C. 2306a(d)—</P>
                            <P>(1) Contracting officers shall not determine the price of a contract or subcontract to be fair and reasonable based solely on historical prices paid by the Government (see PGI 215.403-3(4)); and</P>
                            <P>(4) In lieu of the factors for consideration listed in FAR 15.403-3(a)(4), a determination by the head of the contracting activity (see PGI 215.403-3(7)) that it is in the best interest of the Government to make the award to an offeror that does not make a good faith effort to comply with a reasonable request to submit data other than certified cost or pricing data shall be based on consideration of pertinent factors, including the following:</P>
                            <P>(i) The effort to obtain the data.</P>
                            <P>(ii) Availability of other sources of supply of the item or service.</P>
                            <P>(iii) The urgency or criticality of the Government's need for the item or service.</P>
                            <P>(iv) Reasonableness of the price of the contract, subcontract, or modification of the contract or subcontract based on information available to the contracting officer.</P>
                            <P>(v) Rationale or justification made by the offeror for not providing the requested data.</P>
                            <P>(vi) Risk to the Government if award is not made.</P>
                            <P>
                                (c) 
                                <E T="03">Commercial products or commercial services.</E>
                                 For determinations of price reasonableness of major weapon systems acquired as commercial products, see 234.7002(e).
                            </P>
                            <CITA>[72 FR 30278, May 31, 2007, as amended at 77 FR 76940, Dec. 31, 2012; 85 FR 34532, June 5, 2020; 87 FR 65504, Oct. 28, 2022; 88 FR 6583, Jan. 31, 2023; 89 FR 46808, May 30, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.403-5</SECTNO>
                            <SUBJECT>Instructions for submission of certified cost or pricing data and data other than certified cost or pricing data.</SUBJECT>
                            <P>
                                (b)(3) For contractors following the contract cost principles in FAR subpart 31.2, Contracts With Commercial Organizations, pursuant to the procedures in FAR 42.1701(b), the administrative contracting officer shall require contractors to comply with the submission items in Table 215.403-1 in order to ensure that their forward pricing rate proposal is submitted in an acceptable form in accordance with FAR 15.403-5(b)(3). The contracting officer should request that the proposal be submitted to the Government at least 90 days prior to the proposed effective date of the rates. To ensure the proposal is complete, the contracting officer shall request that the contractor complete the Contractor Forward Pricing Rate Proposal Adequacy Checklist at Table 215.403-1, and submit it with the forward pricing rate proposal.
                                <PRTPAGE P="111"/>
                            </P>
                            <HD SOURCE="HD1">Table 215.403-1—Contractor Forward Pricing Rate Proposal Adequacy Checklist</HD>
                            <EXTRACT>
                                <P>Complete the following checklist, providing the location of requested information, or an explanation of why the requested information is not provided, and submit it with the forward pricing rate proposal.</P>
                            </EXTRACT>
                            <GPOTABLE COLS="3" OPTS="L2" CDEF="s150,r75,r30">
                                <TTITLE>Contractor Forward Pricing Rate Proposal Adequacy Checklist</TTITLE>
                                <BOXHD>
                                    <CHED H="1">Submission item</CHED>
                                    <CHED H="1">
                                        Proposal page No.
                                        <LI>(if applicable)</LI>
                                    </CHED>
                                    <CHED H="1">
                                        If not provided,
                                        <LI>explain (may use</LI>
                                        <LI>continuation pages)</LI>
                                    </CHED>
                                </BOXHD>
                                <ROW EXPSTB="02" RUL="s">
                                    <ENT I="21">
                                        <E T="02">General Instructions</E>
                                    </ENT>
                                </ROW>
                                <ROW EXPSTB="00">
                                    <ENT I="01" O="xl">1. Is there a properly completed first page of the proposal as specified by the contracting officer?</ENT>
                                    <ENT>Proposal Cover Page</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="03" O="xl">Initial proposal elements include:</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="03" O="xl">a. Name and address of contractor;</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="03" O="xl">b. Name and telephone number of point of contact;</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="03" O="xl">c. Period covered;</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="03" O="xl">d. The page of the proposal that addresses—</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="03" O="xl">1. Whether your organization is subject to cost accounting standards (CAS);</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="03" O="xl">2. Whether your organization has submitted a CAS Disclosure Statement, and whether it has been determined adequate;</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="03" O="xl">3. Whether you have been notified that you are or may be in noncompliance with your Disclosure Statement or CAS (other than a noncompliance that the cognizant Federal agency official had determined to have an immaterial cost impact), and if yes, an explanation;</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="03" O="xl">4. Whether any aspect of this proposal is inconsistent with your disclosed practices or applicable CAS, and, if so, an explanation; and whether the proposal is consistent with established estimating and accounting principles and procedures and FAR part 31, Cost Principles, and, if not, an explanation;</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="03" O="xl">e. The following statement: “This forward pricing rate proposal reflects our estimates, as of the date of submission entered in (f) below and conforms with Table 215.403-1. By submitting this proposal, we grant the Contracting Officer and authorized representative(s) the right to examine those records, which include books, documents, accounting procedures and practices, and other data, regardless of type and form or whether such supporting information is specifically referenced or included in the proposal as the basis for each estimate, that will permit an adequate evaluation of the proposed rates and factors.”;</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="03" O="xl">f. Date of submission; and</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="03" O="xl">g. Name, title, and signature of authorized representative.</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01" O="xl">2. Summary of proposed direct and indirect rates and factors, including the proposed pool and base costs for each proposed indirect rate and factor.</ENT>
                                    <ENT>Immediately following the proposal cover page</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="22" O="xl">3. Table of Contents or index.</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="03" O="xl">a. Does the proposal include a table of contents or index identifying and referencing all supporting data accompanying or identified in the proposal?</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="03" O="xl">b. For supporting documentation not provided with the proposal, does the basis of each estimate in the proposal include the location of the documentation and the point of contact (custodian) name, phone number, and email address? Does the proposal disclose known or anticipated changes in business activities or processes that could materially impact the proposed rates (if not previously provided)? For example—</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01" O="xl">4.  a. Management initiatives to reduce costs;</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="03" O="xl">b. Changes in management objectives as a result of economic conditions and increased competitiveness;</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="03" O="xl">c. Changes in accounting policies, procedures, and practices including (i) reclassification of expenses from direct to indirect or vice versa; (ii) new methods of accumulating and allocating indirect costs and the related impact; and (iii) advance agreements;</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="03" O="xl">d. Company reorganizations (including acquisitions or divestitures);</ENT>
                                </ROW>
                                <ROW>
                                    <PRTPAGE P="112"/>
                                    <ENT I="03" O="xl">e. Shutdown of facilities; or</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="03" O="xl">f. Changes in business volume and/or contract mix/type.</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01" O="xl">5. Do proposed costs based on judgmental factors include an explanation of the estimating processes and methods used, including those used in projecting from known data?</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01" O="xl">6. Does the proposal show trends and budgetary data? Does the proposal provide an explanation of how the data, as well as any adjustments to the data, were used?</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01" O="xl">7. The proposal should reconcile to the supporting data referenced. If the proposal does not reconcile to the supporting data referenced, identify applicable page(s) and explain.</ENT>
                                </ROW>
                                <ROW RUL="s">
                                    <ENT I="01" O="xl">8. The proposal should be internally consistent. If the proposal is not internally consistent, identify applicable page(s) and explain.</ENT>
                                </ROW>
                                <ROW EXPSTB="02" RUL="s">
                                    <ENT I="21">
                                        <E T="02">Direct Labor</E>
                                    </ENT>
                                </ROW>
                                <ROW EXPSTB="00">
                                    <ENT I="03" O="xl">Direct Labor Rates Methodology and Basis of Each Estimate</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01" O="xl">9.  a. Does the proposal include an explanation of the methodology used to develop the direct labor rates and identify the basis of each estimate?</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="03" O="xl">b. Does the proposal include or identify the location of the supporting documents for the base-period labor rates (e.g., payroll records)?</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01" O="xl">10. Does the proposal identify escalation factors for the out-year labor rates, the costs to which escalation is applicable, and the basis of each factor used?</ENT>
                                </ROW>
                                <ROW RUL="s">
                                    <ENT I="01" O="xl">11. Does the proposal identify planned or anticipated changes in the composition of labor rates, labor categories, union agreements, headcounts, or other factors that could significantly impact the direct labor rates?</ENT>
                                </ROW>
                                <ROW EXPSTB="02" RUL="s">
                                    <ENT I="21" O="xl">
                                        <E T="02">Indirect Rates (Fringe, Overhead, G&amp;A, etc.)</E>
                                    </ENT>
                                </ROW>
                                <ROW EXPSTB="00">
                                    <ENT I="01" O="xl">12. Indirect Rates Methodology and Basis of Each Estimate.</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="03" O="xl">a. Does the proposal identify the basis of each estimate and provide an explanation of the methodology used to develop the indirect rates?</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="03" O="xl">b. Does the proposal include or identify the location of the supporting documents for the proposed rates?</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01" O="xl">13. Does the proposal identify indirect expenses by burden center, by cost element, by year (including any voluntary deletions, if applicable) in a format that is consistent with the accounting system used to accumulate actual expenses?</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01" O="xl">14. Does the proposal identify any contingencies?</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01" O="xl">15. Does the proposal identify planned or anticipated changes in the nature, type, or level of indirect costs, including fringe benefits?</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01" O="xl">16. Does the proposal identify corporate, home office, shared services, or other incoming allocated costs and the source for those costs, including location and point of contact (custodian) name, phone number, and email address?</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01" O="xl">17. Does the proposal separately identify all intermediate cost pools and provide a reconciliation to show where the costs will be allocated?</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01" O="xl">18. Does the proposal identify the escalation factors used to escalate indirect costs for the out-years, the costs to which escalation is applicable, and the basis of each factor used?</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01" O="xl">19. Does the proposal provide details of the development of the allocation base?</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01" O="xl">20. Does the proposal include or reference the supporting data for the allocation base such as program budgets, negotiation memoranda, proposals, contract values, etc.?</ENT>
                                </ROW>
                                <ROW RUL="s">
                                    <ENT I="01" O="xl">21. Does the proposal identify how the proposed allocation bases reconcile with its long range plans, strategic plan, operating budgets, sales forecasts, program budgets, etc.?</ENT>
                                </ROW>
                                <ROW EXPSTB="02" RUL="s">
                                    <ENT I="21" O="xl">
                                        <E T="02">Cost of Money (COM)</E>
                                    </ENT>
                                </ROW>
                                <ROW EXPSTB="00">
                                    <ENT I="01" O="xl">22. Cost of Money.</ENT>
                                </ROW>
                                <ROW>
                                    <PRTPAGE P="113"/>
                                    <ENT I="03" O="xl">a. Are Cost of Money rates submitted on Form CASB-CMF, with the Treasury Rate used to compute COM identified and a summary of the net book value of assets, identified as distributed and non-distributed?</ENT>
                                </ROW>
                                <ROW RUL="s">
                                    <ENT I="03" O="xl">b. Does the proposal identify the support for the Form CASB-CMF, for example, the underlying reports and records supporting the net book value of assets contained in the form?</ENT>
                                </ROW>
                                <ROW EXPSTB="02" RUL="s">
                                    <ENT I="21" O="xl">
                                        <E T="02">Other</E>
                                    </ENT>
                                </ROW>
                                <ROW EXPSTB="00">
                                    <ENT I="01" O="xl">23. Does the proposal include a comparison of prior forecasted costs to actual results in the same format as the proposal and an explanation/analysis of any differences?</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01" O="xl">24. If this is a revision to a previous rate proposal or a forward pricing rate agreement, does the new proposal provide a summary of the changes in the circumstances or the facts that the contractor asserts require the change to the rates?</ENT>
                                </ROW>
                            </GPOTABLE>
                            <CITA>[79 FR 73496, Dec. 11, 2014]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.404</SECTNO>
                            <SUBJECT>Proposal analysis.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.404-1</SECTNO>
                            <SUBJECT>Proposal analysis techniques.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">General.</E>
                                 (i) Follow the procedures at PGI 215.404-1 for proposal analysis.
                            </P>
                            <P>(ii) For spare parts or support equipment, perform an analysis of—</P>
                            <P>(A) Those line items where the proposed price exceeds by 25 percent or more the lowest price the Government has paid within the most recent 12-month period based on reasonably available data;</P>
                            <P>(B) Those line items where a comparison of the item description and the proposal price indicates a potential for overpricing;</P>
                            <P>(C) Significant high-dollar-value items. If there are no obvious high-dollar-value items, include an analysis of a random sample of items; and</P>
                            <P>(D) A random sample of the remaining low-dollar value items. Sample size may be determined by subjective judgment, e.g., experience with the offeror and the reliability of its estimating and accounting systems.</P>
                            <P>
                                (b) 
                                <E T="03">Price analysis.</E>
                                 (i) In the absence of adequate price competition in response to the solicitation, pricing based on market prices is the preferred method to establish a fair and reasonable price (see PGI 215.404-1(b)(i)).
                            </P>
                            <P>(ii) If the contracting officer determines that the information obtained through market research is insufficient to determine the reasonableness of price, the contracting officer shall consider information submitted by the offeror of recent purchase prices paid by the Government and commercial customers for the same or similar commercial products or commercial services under comparable terms and conditions in establishing price reasonableness on a subsequent purchase if the contracting officer is satisfied that the prices previously paid remain a valid reference for comparison. Price reasonableness shall not be based solely on historical prices paid by the Government (see 215.403-3(a)(1)). The contracting officer shall consider the totality of other relevant factors such as the time elapsed since the prior purchase and any differences in the quantities purchased (10 U.S.C. 3703(e)).</P>
                            <P>(iii) If the contracting officer determines that the offeror cannot provide sufficient information as described in paragraph (b)(ii) of this section to determine the reasonableness of price, the contracting officer should request the offeror to submit information on—</P>
                            <P>
                                (A) Prices paid for the same or similar items sold under different terms and conditions;
                                <PRTPAGE P="114"/>
                            </P>
                            <P>(B) Prices paid for similar levels of work or effort on related products or services;</P>
                            <P>(C) Prices paid for alternative solutions or approaches; and</P>
                            <P>(D) Other relevant information that can serve as the basis for determining the reasonableness of price.</P>
                            <P>(iv) If the contracting officer determines that the pricing information submitted is not sufficient to determine the reasonableness of price, the contracting officer shall request other relevant information, to include cost data. However, no cost data may be required in any case in which there are sufficient non-Government sales of the same item to establish reasonableness of price (section 831 of the National Defense Authorization Act for Fiscal Year 2013 (Pub. L. 112-239)).</P>
                            <P>(v) When evaluating pricing data, the contracting officer shall consider materially differing terms and conditions, quantities, and market and economic factors (see PGI 215.404-1(b)(v)). For similar items, the contracting officer shall also consider material differences between the similar item and the item being procured (see FAR 15.404-1(b)(2)(ii)(B)). Material differences are those that could reasonably be expected to influence the contracting officer's determination of price reasonableness. The contracting officer shall consider the following factors when evaluating the relevance of the information available:</P>
                            <P>
                                (A) 
                                <E T="03">Market prices.</E>
                            </P>
                            <P>
                                (B) 
                                <E T="03">Age of data.</E>
                            </P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Whether data is too old to be relevant depends on the industry (
                                <E T="03">e.g.,</E>
                                 rapidly evolving technologies), product maturity (
                                <E T="03">e.g.,</E>
                                 stable), economic factors (
                                <E T="03">e.g.,</E>
                                 new sellers in the marketplace), and various other considerations.
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) A pending sale may be relevant if, in the judgement of the contracting officer, it is probable at the anticipated price, and the sale could reasonably be expected to materially influence the contracting officer's determination of price reasonableness. The contracting officer may consult with the cognizant administrative contracting officers (ACOs) as they may have information about pending sales.
                            </P>
                            <P>
                                (C) 
                                <E T="03">Volume and completeness of transaction data.</E>
                                 Data must include a sufficient number of transactions to represent the range of relevant sales to all types of customers. The data must also include key information, such as date, quantity sold, part number, part nomenclature, sales price, and customer. If the number of transactions is insufficient or the data is incomplete, the contracting officer shall request additional sales data to evaluate price reasonableness. If the contractor cannot provide sufficient sales data, the contracting officer shall request other relevant information.
                            </P>
                            <P>
                                (D) 
                                <E T="03">Nature of transactions.</E>
                                 The nature of a sales transaction includes the information necessary to understand the transaction, such as terms and conditions, date, quantity sold, sale price, unique requirements, the type of customer (government, distributor, retail end-user, etc.), and related agreements. It also includes warranties, key product technical specifications, maintenance agreements, and preferred customer rewards.
                            </P>
                            <P>(vi) The contracting officer shall consider catalog prices to be reliable when they are regularly maintained and supported by relevant sales data (including any related discounts, refunds, rebates, offsets, or other adjustments). The contracting officer may request that the offeror support differences between the proposed price(s), catalog price(s), and relevant sales data.</P>
                            <P>(vii) The contracting officer may consult with the DoD cadre of experts who are available to provide expert advice to the acquisition workforce in assisting with commercial product or commercial service determinations and price reasonableness determinations. The DoD cadre of experts is identified at PGI 215.404-1(b)(vii).</P>
                            <P>
                                (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).
                                <PRTPAGE P="115"/>
                            </P>
                            <P>
                                (h) 
                                <E T="03">Review and justification of pass-through contracts.</E>
                                 Follow the procedures at PGI 215.404-1(h)(2) when considering alternative approaches or making the determination that the contracting approach selected is in the best interest of the Government, as required by FAR 15.404-1(h)(2).
                            </P>
                            <CITA>[63 FR 55040, Oct. 14, 1998, as amended at 71 FR 69494, Dec. 1, 2006; 72 FR 30278, May 31, 2007; 77 FR 76940, Dec. 31, 2012; 83 FR 4444, Jan. 31, 2018; 84 FR 72563, Dec. 31, 2019; 87 FR 65504, Oct. 28, 2022; 87 FR 76992, Dec. 16, 2022; 88 FR 6583, Jan. 31, 2023; 88 FR 17339, Mar. 22, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.404-2</SECTNO>
                            <SUBJECT>Data to support proposal analysis.</SUBJECT>
                            <P>See PGI 215.404-2 for guidance on obtaining field pricing or audit assistance.</P>
                            <CITA>[71 FR 69494, Dec. 1, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.404-3</SECTNO>
                            <SUBJECT>Subcontract pricing considerations.</SUBJECT>
                            <P>Follow the procedures at PGI 215.404-3 when reviewing a subcontractor's proposal.</P>
                            <CITA>[71 FR 69494, Dec. 1, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.404-4</SECTNO>
                            <SUBJECT>Profit.</SUBJECT>
                            <P>
                                (b) 
                                <E T="03">Policy.</E>
                                 (1) Contracting officers shall use a structured approach for developing a prenegotiation profit or fee objective on any negotiated contract action when certified cost or pricing data is obtained, except for cost-plus-award-fee contracts (see 215.404-74, 216.405-2, and FAR 16.405-2) or contracts with Federally Funded Research and Development Centers (FFRDCs) (see 215.404-75). There are three structured approaches—
                            </P>
                            <P>(A) The weighted guidelines method;</P>
                            <P>(B) The modified weighted guidelines method; and</P>
                            <P>(C) An alternate structured approach.</P>
                            <P>
                                (c) 
                                <E T="03">Contracting officer responsibilities.</E>
                                 (1) Also, do not perform a profit analysis when assessing cost realism in competitive acquisitions.
                            </P>
                            <P>(2) When using a structured approach, the contracting officer—</P>
                            <P>(A) Shall use the weighted guidelines method (see 215.404-71), except as provided in paragraphs (c)(2)(B) and (c)(2)(C) of this subsection.</P>
                            <P>(B) Shall use the modified weighted guidelines method (see 215.404-72) on contract actions with nonprofit organizations other than FFRDCs.</P>
                            <P>(C) May use an alternate structured approach (see 215.404-73) when—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) The contract action is—
                            </P>
                            <P>
                                (
                                <E T="03">i</E>
                                ) At or below the certified cost or pricing data threshold (see FAR 15.403-4(a)(1));
                            </P>
                            <P>
                                (
                                <E T="03">ii</E>
                                ) For architect-engineer or construction work;
                            </P>
                            <P>
                                (
                                <E T="03">iii</E>
                                ) Primarily for delivery of material from subcontractors; or
                            </P>
                            <P>
                                (
                                <E T="03">iv</E>
                                ) A termination settlement; or
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) The weighted guidelines method does not produce a reasonable overall profit objective and the head of the contracting activity approves use of the alternate approach in writing.
                            </P>
                            <P>(D) Shall use the weighted guidelines method to establish a basic profit rate under a formula-type pricing agreement, and may then use the basic rate on all actions under the agreement, provided that conditions affecting profit do not change.</P>
                            <P>(E) Shall document the profit analysis in the contract file.</P>
                            <P>(5) Although specific agreement on the applied weights or values for individual profit factors shall not be attempted, the contracting officer may encourage the contractor to—</P>
                            <P>(A) Present the details of its proposed profit amounts in the weighted guidelines format or similar structured approached; and</P>
                            <P>(B) Use the weighted guidelines method in developing profit objectives for negotiated subcontracts.</P>
                            <P>(6) The contracting officer must also verify that relevant variables have not materially changed (e.g., performance risk, interest rates, progress payment rates, distribution of facilities capital).</P>
                            <P>
                                (d) 
                                <E T="03">Profit-analysis factors</E>
                                —(1) 
                                <E T="03">Common factors.</E>
                                 The common factors are embodied in the DoD structured approaches and need not be further considered by the contracting officer.
                            </P>
                            <CITA>[63 FR 55040, Oct. 14, 1998, as amended at 63 FR 63799, Nov. 17, 1998; 65 FR 77829, Dec. 13, 2000; 66 FR 49863, Oct. 1, 2001; 71 FR 69494, Dec. 1, 2006; 77 FR 76940, Dec. 31, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.404-70</SECTNO>
                            <SUBJECT>DD Form 1547, Record of Weighted Guidelines Method Application.</SUBJECT>
                            <P>
                                Follow the procedures at PGI 215.404-70 for use of DD Form 1547 whenever a 
                                <PRTPAGE P="116"/>
                                structured approach to profit analysis is required.
                            </P>
                            <CITA>[71 FR 69494, Dec. 1, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.404-71</SECTNO>
                            <SUBJECT>Weighted guidelines method.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.404-71-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>(a) The weighted guidelines method focuses on four profit factors—</P>
                            <P>(1) Performance risk;</P>
                            <P>(2) Contract type risk;</P>
                            <P>(3) Facilities capital employed; and</P>
                            <P>(4) Cost efficiency.</P>
                            <P>(b) The contracting officer assigns values to each profit factor; the value multiplied by the base results in the profit objective for that factor. Except for the cost efficiency special factor, each profit factor has a normal value and a designated range of values. The normal value is representative of average conditions on the prospective contract when compared to all goods and services acquired by DoD. The designated range provides values based on above normal or below normal conditions. In the price negotiation documentation, the contracting officer need not explain assignment of the normal value, but should address conditions that justify assignment of other than the normal value. The cost efficiency special factor has no normal value. The contracting officer shall exercise sound business judgment in selecting a value when this special factor is used (see 215.404-71-5).</P>
                            <CITA>[67 FR 20689, Apr. 26, 2002]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.404-71-2</SECTNO>
                            <SUBJECT>Performance risk.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Description.</E>
                                 This profit factor addresses the contractor's degree of risk in fulfilling the contract requirements. The factor consists of two parts:
                            </P>
                            <P>(1) Technical—the technical uncertainties of performance.</P>
                            <P>(2) Management/cost control—the degree of management effort necessary—</P>
                            <P>(i) To ensure that contract requirements are met; and</P>
                            <P>(ii) To reduce and control costs.</P>
                            <P>
                                (b) 
                                <E T="03">Determination.</E>
                                 The following extract from the DD Form 1547 is annotated to describe the process.
                            </P>
                            <GPOTABLE COLS="6" OPTS="L2" CDEF="xs10,r30,12,12,12,12">
                                <BOXHD>
                                    <CHED H="1">Item</CHED>
                                    <CHED H="1">Contractor risk factors</CHED>
                                    <CHED H="1">Assigned weighting</CHED>
                                    <CHED H="1">Assigned value</CHED>
                                    <CHED H="1">Base (item 20)</CHED>
                                    <CHED H="1">Profit objective</CHED>
                                </BOXHD>
                                <ROW>
                                    <ENT I="01">21</ENT>
                                    <ENT>Technical</ENT>
                                    <ENT>(1)</ENT>
                                    <ENT>(2)</ENT>
                                    <ENT>N/A</ENT>
                                    <ENT>N/A</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">22</ENT>
                                    <ENT>Management/Cost Control</ENT>
                                    <ENT>(1)</ENT>
                                    <ENT>(2)</ENT>
                                    <ENT>N/A</ENT>
                                    <ENT>N/A</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">23</ENT>
                                    <ENT>Performance Risk (Composite)</ENT>
                                    <ENT>N/A</ENT>
                                    <ENT>(3)</ENT>
                                    <ENT>(4)</ENT>
                                    <ENT>(5)</ENT>
                                </ROW>
                            </GPOTABLE>
                            <P>(1) Assign a weight (percentage) to each element according to its input to the total performance risk. The total of the two weights equals 100 percent.</P>
                            <P>(2) Select a value for each element from the list in paragraph (c) of this subsection using the evaluation criteria in paragraphs (d) and (e) of this subsection.</P>
                            <P>(3) Compute the composite as shown in the following example:</P>
                            <GPOTABLE COLS="4" OPTS="L2" CDEF="s50,10,10,10">
                                <BOXHD>
                                    <CHED H="1"> </CHED>
                                    <CHED H="1">
                                        Assigned weighting
                                        <LI>(percent)</LI>
                                    </CHED>
                                    <CHED H="1">
                                        Assigned
                                        <LI>value</LI>
                                        <LI>(percent)</LI>
                                    </CHED>
                                    <CHED H="1">
                                        Weighted
                                        <LI>value</LI>
                                        <LI>(percent)</LI>
                                    </CHED>
                                </BOXHD>
                                <ROW>
                                    <ENT I="01">Technical</ENT>
                                    <ENT>60</ENT>
                                    <ENT>5.0</ENT>
                                    <ENT>3.0</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">Management/Cost Control</ENT>
                                    <ENT>40</ENT>
                                    <ENT>4.0</ENT>
                                    <ENT>1.6</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">Composite Value</ENT>
                                    <ENT>100</ENT>
                                    <ENT/>
                                    <ENT>4.6</ENT>
                                </ROW>
                            </GPOTABLE>
                            <P>(4) Insert the amount from Block 20 of the DD Form 1547. Block 20 is total contract costs, excluding facilities capital cost of money.</P>
                            <P>(5) Multiply (3) by (4).</P>
                            <P>(c) Values: Normal and designated ranges.</P>
                            <GPOTABLE COLS="3" OPTS="L2" CDEF="s25,10,xs40">
                                <BOXHD>
                                    <CHED H="1"> </CHED>
                                    <CHED H="1">
                                        Normal
                                        <LI>value</LI>
                                        <LI>(percent)</LI>
                                    </CHED>
                                    <CHED H="1">
                                        Designated
                                        <LI>range</LI>
                                    </CHED>
                                </BOXHD>
                                <ROW>
                                    <ENT I="01">Standard</ENT>
                                    <ENT>5</ENT>
                                    <ENT>3% to 7%</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">Technology Incentive</ENT>
                                    <ENT>9</ENT>
                                    <ENT>7% to 11%</ENT>
                                </ROW>
                            </GPOTABLE>
                            <P>
                                (1) 
                                <E T="03">Standard.</E>
                                 The standard designated range should apply to most contracts.
                                <PRTPAGE P="117"/>
                            </P>
                            <P>
                                (2) 
                                <E T="03">Technology incentive.</E>
                                 For the technical factor only, contracting officers may use the technology incentive range for acquisitions that include development, production, or application of innovative new technologies. The technology incentive range does not apply to efforts restricted to studies, analyses, or demonstrations that have a technical report as their primary deliverable.
                            </P>
                            <P>
                                (d) 
                                <E T="03">Evaluation criteria for technical.</E>
                                 (1) Review the contract requirements and focus on the critical performance elements in the statement of work or specifications. Factors to consider include—
                            </P>
                            <P>(i) Technology being applied or developed by the contractor;</P>
                            <P>(ii) Technical complexity;</P>
                            <P>(iii) Program maturity;</P>
                            <P>(iv) Performance specifications and tolerances;</P>
                            <P>(v) Delivery schedule; and</P>
                            <P>(vi) Extent of a warranty or guarantee.</P>
                            <P>
                                (2) 
                                <E T="03">Above normal conditions.</E>
                                 (i) The contracting officer may assign a higher than normal value in those cases where there is a substantial technical risk. Indicators are—
                            </P>
                            <P>(A) Items are being manufactured using specifications with stringent tolerance limits;</P>
                            <P>(B) The efforts require highly skilled personnel or require the use of state-of-the-art machinery;</P>
                            <P>(C) The services and analytical efforts are extremely important to the Government and must be performed to exacting standards;</P>
                            <P>(D) The contractor's independent development and investment has reduced the Government's risk or cost;</P>
                            <P>(E) The contractor has accepted an accelerated delivery schedule to meet DoD requirements; or</P>
                            <P>(F) The contractor has assumed additional risk through warranty provisions.</P>
                            <P>(ii) Extremely complex, vital efforts to overcome difficult technical obstacles that require personnel with exceptional abilities, experience, and professional credentials may justify a value significantly above normal.</P>
                            <P>(iii) The following may justify a maximum value—</P>
                            <P>(A) Development or initial production of a new item, particularly if performance or quality specifications are tight; or</P>
                            <P>(B) A high degree of development or production concurrency.</P>
                            <P>
                                (3) 
                                <E T="03">Below normal conditions.</E>
                                 (i) The contracting officer may assign a lower than normal value in those cases where the technical risk is low. Indicators are—
                            </P>
                            <P>(A) Requirements are relatively simple;</P>
                            <P>(B) Technology is not complex;</P>
                            <P>(C) Efforts do not require highly skilled personnel;</P>
                            <P>(D) Efforts are routine;</P>
                            <P>(E) Programs are mature; or</P>
                            <P>(F) Acquisition is a follow-on effort or a repetitive type acquisition.</P>
                            <P>(ii) The contracting officer may assign a value significantly below normal for—</P>
                            <P>(A) Routine services;</P>
                            <P>(B) Production of simple items;</P>
                            <P>(C) Rote entry or routine integration of Government-furnished information; or</P>
                            <P>(D) Simple operations with Government-furnished property.</P>
                            <P>
                                (4) 
                                <E T="03">Technology incentive range.</E>
                                 (i) The contracting officer may assign values within the technology incentive range when contract performance includes the introduction of new, significant technological innovation. Use the technology incentive range only for the most innovative contract efforts. Innovation may be in the form of—
                            </P>
                            <P>(A) Development or application of new technology that fundamentally changes the characteristics of an existing product or system and that results in increased technical performance, improved reliability, or reduced costs; or</P>
                            <P>(B) New products or systems that contain significant technological advances over the products or systems they are replacing.</P>
                            <P>
                                (ii) When selecting a value within the technology incentive range, the contracting officer should consider the relative value of the proposed innovation to the acquisition as a whole. When the innovation represents a minor benefit, the contracting officer should consider using values less than the norm. For innovative efforts that will have a 
                                <PRTPAGE P="118"/>
                                major positive impact on the product or program, the contracting officer may use values above the norm.
                            </P>
                            <P>
                                (e) 
                                <E T="03">Evaluation criteria for management/cost control.</E>
                                 (1) The contracting officer should evaluate—
                            </P>
                            <P>(i) The contractor's management and internal control systems using contracting office data, information and reviews made by field contract administration offices or other DoD field offices;</P>
                            <P>(ii) The management involvement expected on the prospective contract action;</P>
                            <P>(iii) The degree of cost mix as an indication of the types of resources applied and value added by the contractor;</P>
                            <P>(iv) The contractor's support of Federal socioeconomic programs;</P>
                            <P>(v) The expected reliability of the contractor's cost estimates (including the contractor's cost estimating system);</P>
                            <P>(vi) The adequacy of the contractor's management approach to controlling cost and schedule; and</P>
                            <P>(vii) Any other factors that affect the contractor's ability to meet the cost targets (e.g., foreign currency exchange rates and inflation rates).</P>
                            <P>
                                (2) 
                                <E T="03">Above normal conditions.</E>
                                 (i) The contracting officer may assign a higher than normal value when there is a high degree of management effort. Indicators of this are—
                            </P>
                            <P>(A) The contractor's value added is both considerable and reasonably difficult;</P>
                            <P>(B) The effort involves a high degree of integration or coordination;</P>
                            <P>(C) The contractor has a good record of past performance;</P>
                            <P>(D) The contractor has a substantial record of active participation in Federal socioeconomic programs;</P>
                            <P>(E) The contractor provides fully documented and reliable cost estimates;</P>
                            <P>(F) The contractor makes appropriate make-or-buy decisions; or</P>
                            <P>(G) The contractor has a proven record of cost tracking and control.</P>
                            <P>(ii) The contracting officer may justify a maximum value when the effort—</P>
                            <P>(A) Requires large scale integration of the most complex nature;</P>
                            <P>(B) Involves major international activities with significant management coordination (e.g., offsets with foreign vendors); or</P>
                            <P>(C) Has critically important milestones.</P>
                            <P>(iii) If the contractor demonstrates efficient management and cost control through the submittal of a timely, qualifying proposal (as defined in 217.7401) in furtherance of definitization of an undefinitized contract action, and the proposal demonstrates effective cost control from the time of award to the present, the contracting officer may add 1 percentage point to the value determined for management/cost control up to the maximum of 7 percent.</P>
                            <P>
                                (3) 
                                <E T="03">Below normal conditions.</E>
                                 (i) The contracting officer may assign a lower than normal value when the management effort is minimal. Indicators of this are—
                            </P>
                            <P>(A) The program is mature and many end item deliveries have been made;</P>
                            <P>(B) The contractor adds minimal value to an item;</P>
                            <P>(C) The efforts are routine and require minimal supervision;</P>
                            <P>(D) The contractor provides poor quality, untimely proposals;</P>
                            <P>(E) The contractor fails to provide an adequate analysis of subcontractor costs;</P>
                            <P>(F) The contractor does not cooperate in the evaluation and negotiation of the proposal;</P>
                            <P>(G) The contractor's cost estimating system is marginal;</P>
                            <P>(H) The contractor has made minimal effort to initiate cost reduction programs;</P>
                            <P>(I) The contractor's cost proposal is inadequate;</P>
                            <P>(J) The contractor has a record of cost overruns or another indication of unreliable cost estimates and lack of cost control; or</P>
                            <P>(K) The contractor has a poor record of past performance.</P>
                            <P>(ii) The following may justify a value significantly below normal—</P>
                            <P>
                                (A) Reviews performed by the field contract administration offices disclose unsatisfactory management and internal control systems (e.g., quality assurance, property control, safety, security); or
                                <PRTPAGE P="119"/>
                            </P>
                            <P>(B) The effort requires an unusually low degree of management involvement.</P>
                            <CITA>[67 FR 20689, Apr. 26, 2002, as amended at 67 FR 49254, July 30, 2002; 78 FR 13543, Feb. 28, 2013; 83 FR 30586, June 29, 2018; 84 FR 39205, Aug. 9, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.404-71-3</SECTNO>
                            <SUBJECT>Contract type risk and working capital adjustment.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Description.</E>
                                 The contract type risk factor focuses on the degree of cost risk accepted by the contractor under varying contract types. The working capital adjustment is an adjustment added to the profit objective for contract type risk. It only applies to fixed-price contracts that provide for progress payments. Though it uses a formula approach, it is not intended to be an exact calculation of the cost of working capital. Its purpose is to give general recognition to the contractor's cost of working capital under varying contract circumstances, financing policies, and the economic environment.
                            </P>
                            <P>
                                (b) 
                                <E T="03">Determination.</E>
                                 The following extract from the DD 1547 is annotated to explain the process.
                            </P>
                            <GPOTABLE COLS="5" OPTS="L2" CDEF="xs30,r100,12,12,12">
                                <BOXHD>
                                    <CHED H="1">Item</CHED>
                                    <CHED H="1">Contractor risk factors</CHED>
                                    <CHED H="1">
                                        Assigned
                                        <LI>value</LI>
                                    </CHED>
                                    <CHED H="1">Base</CHED>
                                    <CHED H="1">
                                        Profit
                                        <LI>objective</LI>
                                    </CHED>
                                </BOXHD>
                                <ROW>
                                    <ENT I="01">24a</ENT>
                                    <ENT>Contract Type Risk (based on incurred costs at the time of qualifying proposal submission)</ENT>
                                    <ENT>(1)</ENT>
                                    <ENT>(2)(i)</ENT>
                                    <ENT>(3)</ENT>
                                </ROW>
                                <ROW RUL="n,n,s">
                                    <ENT I="01">24b</ENT>
                                    <ENT>Contract Type Risk (based on Government estimated cost to complete)</ENT>
                                    <ENT>(1)</ENT>
                                    <ENT>(2)(ii)</ENT>
                                    <ENT>(3)</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">24c</ENT>
                                    <ENT O="oi3">Totals</ENT>
                                    <ENT/>
                                    <ENT>(3)</ENT>
                                    <ENT>(3)</ENT>
                                </ROW>
                            </GPOTABLE>
                            <GPOTABLE COLS="6" OPTS="L2" CDEF="xs30,r100,12,12,12,12">
                                <BOXHD>
                                    <CHED H="1">Item</CHED>
                                    <CHED H="1">Contractor risk factors</CHED>
                                    <CHED H="1">
                                        Costs
                                        <LI>financed</LI>
                                    </CHED>
                                    <CHED H="1">
                                        Length
                                        <LI>factor</LI>
                                    </CHED>
                                    <CHED H="1">
                                        Interest
                                        <LI>rate</LI>
                                    </CHED>
                                    <CHED H="1">
                                        Profit
                                        <LI>objective</LI>
                                    </CHED>
                                </BOXHD>
                                <ROW>
                                    <ENT I="01">25</ENT>
                                    <ENT>Working Capital (4)</ENT>
                                    <ENT>(5)</ENT>
                                    <ENT>(6)</ENT>
                                    <ENT>(7)</ENT>
                                    <ENT>(8)</ENT>
                                </ROW>
                            </GPOTABLE>
                            <P>(1) Select a value from the list of contract types in paragraph (c) of this section using the evaluation criteria in paragraph (d) of this section. See paragraph (d)(2) of this section.</P>
                            <P>(2)(i) Insert the amount of costs incurred as of the date the contractor submits a qualifying proposal, such as under an undefinitized contract action, (excluding facilities capital cost of money) into the Block 24a column titled Base.</P>
                            <P>(ii) Insert the amount of Government estimated cost to complete (excluding facilities capital cost of money) into the Block 24b column titled Base.</P>
                            <P>(3) Multiply (1) by (2)(i) and (2)(ii), respectively for Blocks 24a and 24b. Add Blocks 24a and 24b and insert the totals in Block 24c.</P>
                            <P>(4) Only complete this block when the prospective contract is a fixed-price contract containing provisions for progress payments.</P>
                            <P>(5) Insert the amount computed per paragraph (e) of this subsection.</P>
                            <P>(6) Insert the appropriate figure from paragraph (f) of this subsection.</P>
                            <P>
                                (7) Use the interest rate established by the Secretary of the Treasury (see 
                                <E T="03">https://www.fiscal.treasury.gov/fsservices/gov/pmt/promptPayment/rates.htm</E>
                                ). Do not use any other interest rate.
                            </P>
                            <P>(8) Multiply (5) by (6) by (7). This is the working capital adjustment. It shall not exceed 4 percent of the contract costs in Block 20.</P>
                            <P>
                                (c) 
                                <E T="03">Values: Normal and designated ranges.</E>
                            </P>
                            <GPOTABLE COLS="4" OPTS="L2" CDEF="s100,12,12,xs54">
                                <BOXHD>
                                    <CHED H="1">Contract type</CHED>
                                    <CHED H="1">Notes</CHED>
                                    <CHED H="1">
                                        Normal value
                                        <LI>(percent)</LI>
                                    </CHED>
                                    <CHED H="1">
                                        Designated range
                                        <LI>(percent)</LI>
                                    </CHED>
                                </BOXHD>
                                <ROW>
                                    <ENT I="01">Firm-fixed-price, no financing</ENT>
                                    <ENT>(1)</ENT>
                                    <ENT>5</ENT>
                                    <ENT>4 to 6</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">Firm-fixed-price, with performance-based payments</ENT>
                                    <ENT>(6)</ENT>
                                    <ENT>4</ENT>
                                    <ENT>2.5 to 5.5</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">Firm-fixed-price, with progress payments</ENT>
                                    <ENT>(2)</ENT>
                                    <ENT>3</ENT>
                                    <ENT>2 to 4</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">Fixed-price incentive, no financing</ENT>
                                    <ENT>(1)</ENT>
                                    <ENT>3</ENT>
                                    <ENT>2 to 4</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">Fixed-price incentive, with performance-based payments</ENT>
                                    <ENT>(6)</ENT>
                                    <ENT>2</ENT>
                                    <ENT>0.5 to 3.5</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">Fixed-price with redetermination provision</ENT>
                                    <ENT>(3)</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">Fixed-price incentive, with progress payments</ENT>
                                    <ENT>(2)</ENT>
                                    <ENT>1</ENT>
                                    <ENT>0 to 2</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">Cost-plus-incentive-fee</ENT>
                                    <ENT>(4)</ENT>
                                    <ENT>1</ENT>
                                    <ENT>0 to 2</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">Cost-plus-fixed-fee</ENT>
                                    <ENT>(4)</ENT>
                                    <ENT>0.5</ENT>
                                    <ENT>0 to 1</ENT>
                                </ROW>
                                <ROW>
                                    <PRTPAGE P="120"/>
                                    <ENT I="01">Time-and-materials (including overhaul contracts priced on time-and-materials basis)</ENT>
                                    <ENT>(5)</ENT>
                                    <ENT>0.5</ENT>
                                    <ENT>0 to 1</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">Labor-hour</ENT>
                                    <ENT>(5)</ENT>
                                    <ENT>0.5</ENT>
                                    <ENT>0 to 1</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">Firm-fixed-price, level-of-effort</ENT>
                                    <ENT>(5)</ENT>
                                    <ENT>0.5</ENT>
                                    <ENT>0 to 1</ENT>
                                </ROW>
                            </GPOTABLE>
                            <P>(1) “No financing” means either that the contract does not provide progress payments or performance-based payments, or that the contract provides them only on a limited basis, such as financing of first articles. Do not compute a working capital adjustment.</P>
                            <P>(2) When the contract contains provisions for progress payments, compute a working capital adjustment (Block 25).</P>
                            <P>(3) For the purposes of assigning profit values, treat a fixed-price contract with redetermination provisions as if it were a fixed-price incentive contract with below normal conditions.</P>
                            <P>(4) Cost-plus contracts shall not receive the working capital adjustment.</P>
                            <P>(5) These types of contracts are considered cost-plus-fixed-fee contracts for the purposes of assigning profit values. They shall not receive the working capital adjustment in Block 25. However, they may receive higher than normal values within the designated range to the extent that portions of cost are fixed.</P>
                            <P>(6) When the contract contains provisions for performance-based payments, do not compute a working capital adjustment.</P>
                            <P>
                                (d) 
                                <E T="03">Evaluation criteria</E>
                                —(1) 
                                <E T="03">General.</E>
                                 The contracting officer should consider elements that affect contract type risk such as—
                            </P>
                            <P>(i) Length of contract;</P>
                            <P>(ii) Adequacy of cost data for projections;</P>
                            <P>(iii) Economic environment;</P>
                            <P>(iv) Nature and extent of subcontracted activity;</P>
                            <P>(v) Protection provided to the contractor under contract provisions (e.g., economic price adjustment clauses);</P>
                            <P>(vi) The ceilings and share lines contained in incentive provisions;</P>
                            <P>(vii) Risks associated with contracts for foreign military sales (FMS) that are not funded by U.S. appropriations; and</P>
                            <P>(viii) When the contract contains provisions for performance-based payments—</P>
                            <P>(A) The frequency of payments;</P>
                            <P>(B) The total amount of payments compared to the maximum allowable amount specified at FAR 32.1004(b)(2); and</P>
                            <P>(C) The risk of the payment schedule to the contractor.</P>
                            <P>
                                (2) 
                                <E T="03">Mandatory.</E>
                                (i) The contracting officer shall assess the extent to which costs have been incurred prior to definitization of the contract action (also see 217.7404-6(a) and 243.204-70-6). When considering the reduced cost risks associated with allowable incurred costs on an undefinitized contract action, it is appropriate to apply separate contract risk factors for allowable incurred costs and estimated costs to complete when completing the contract risk sections of DD Form 1547, Record of Weighted Guidelines. When costs have been incurred prior to definitization, generally regard the contract type risk to be in the low end of the designated range. If a substantial portion of the costs has been incurred prior to definitization, the contracting officer may assign a value as low as zero percent, regardless of contract type. However, if a contractor submits a qualifying proposal to definitize an undefinitized contract action and the contracting officer for such action definitizes the contract after the end of the 180-day period beginning on the date on which the contractor submitted the qualifying proposal as defined in 217.7401, the profit allowed on the contract shall accurately reflect the cost risk of the contractor as such risk existed on the date the contractor submitted the qualifying proposal.
                            </P>
                            <P>
                                (ii) Contracting officers shall document in the price negotiation memorandum the reason for assigning a specific contract type risk value, to include the extent to which any reduced 
                                <PRTPAGE P="121"/>
                                cost risk during the undefinitized period of performance was considered, in determining the negotiation objective.
                            </P>
                            <P>
                                (3) 
                                <E T="03">Above normal conditions.</E>
                                 The contracting officer may assign a higher than normal value when there is substantial contract type risk. Indicators of this are—
                            </P>
                            <P>(i) Efforts where there is minimal cost history;</P>
                            <P>(ii) Long-term contracts without provisions protecting the contractor, particularly when there is considerable economic uncertainty;</P>
                            <P>(iii) Incentive provisions (e.g., cost and performance incentives) that place a high degree of risk on the contractor;</P>
                            <P>(iv) FMS sales (other than those under DoD cooperative logistics support arrangements or those made from U.S. Government inventories or stocks) where the contractor can demonstrate that there are substantial risks above those normally present in DoD contracts for similar items; or</P>
                            <P>(v) An aggressive performance-based payment schedule that increases risk.</P>
                            <P>
                                (4) 
                                <E T="03">Below normal conditions.</E>
                                 The contracting officer may assign a lower than normal value when the contract type risk is low. Indicators of this are—
                            </P>
                            <P>(i) Very mature product line with extensive cost history;</P>
                            <P>(ii) Relative short-term contracts;</P>
                            <P>(iii) Contractual provisions that substantially reduce the contractor's risk;</P>
                            <P>(iv) Incentive provisions that place a low degree of risk on the contractor;</P>
                            <P>(v) Performance-based payments totaling the maximum allowable amount(s) specified at FAR 32.1004(b)(2); or</P>
                            <P>(vi) A performance-based payment schedule that is routine with minimal risk.</P>
                            <P>
                                (e) 
                                <E T="03">Costs financed.</E>
                                 (1) Costs financed equal total costs multiplied by the portion (percent) of costs financed by the contractor.
                            </P>
                            <P>(2) Total costs equal Block 20 (i.e., all allowable costs excluding facilities capital cost of money), reduced as appropriate when—</P>
                            <P>(i) The contractor has little cash investment (e.g., subcontractor progress payments liquidated late in period of performance);</P>
                            <P>(ii) Some costs are covered by special financing provisions, such as advance payments; or</P>
                            <P>(iii) The contract is multiyear and there are special funding arrangements.</P>
                            <P>(3) The portion that the contractor finances is generally the portion not covered by progress payments, i.e., 100 percent minus the customary progress payment rate (see FAR 32.501). For example, if a contractor receives progress payments at 80 percent, the portion that the contractor finances is 20 percent. On contracts that provide progress payments to small businesses, use the customary progress payment rate for large businesses.</P>
                            <P>
                                (f) 
                                <E T="03">Contract length factor.</E>
                                 (1) This is the period of time that the contractor has a working capital investment in the contract. It—
                            </P>
                            <P>(i) Is based on the time necessary for the contractor to complete the substantive portion of the work;</P>
                            <P>(ii) Is not necessarily the period of time between contract award and final delivery (or final payment), as periods of minimal effort should be excluded;</P>
                            <P>(iii) Should not include periods of performance contained in option provisions; and</P>
                            <P>(iv) Should not, for multiyear contracts, include periods of performance beyond that required to complete the initial program year's requirements.</P>
                            <P>(2) The contracting officer—</P>
                            <P>(i) Should use the following table to select the contract length factor;</P>
                            <P>(ii) Should develop a weighted average contract length when the contract has multiple deliveries; and</P>
                            <P>(iii) May use sampling techniques provided they produce a representative result.</P>
                            <GPOTABLE COLS="2" OPTS="L2" CDEF="s50,10.2">
                                <TTITLE>Table</TTITLE>
                                <BOXHD>
                                    <CHED H="1">Period to perform substantive portion (in months)</CHED>
                                    <CHED H="1">Contract length factor</CHED>
                                </BOXHD>
                                <ROW>
                                    <ENT I="01">21 or less</ENT>
                                    <ENT>.40</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">22 to 27</ENT>
                                    <ENT>.65</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">28 to 33</ENT>
                                    <ENT>.90</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">34 to 39</ENT>
                                    <ENT>1.15</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">40 to 45</ENT>
                                    <ENT>1.40</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">46 to 51</ENT>
                                    <ENT>1.65</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">52 to 57</ENT>
                                    <ENT>1.90</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">58 to 63</ENT>
                                    <ENT>2.15</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">64 to 69</ENT>
                                    <ENT>2.40</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">70 to 75</ENT>
                                    <ENT>2.65</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">76 or more</ENT>
                                    <ENT>2.90</ENT>
                                </ROW>
                            </GPOTABLE>
                            <PRTPAGE P="122"/>
                            <P>(3) Example: A prospective contract has a performance period of 40 months with end items being delivered in the 34th, 36th, 38th, and 40th months of the contract. The average period is 37 months and the contract length factor is 1.15.</P>
                            <CITA>[63 FR 55040, Oct. 14, 1998, as amended at 64 FR 61032, Nov. 9, 1999; 66 FR 63335, Dec. 6, 2001; 67 FR 20691, Apr. 26, 2002; 67 FR 49255, July 30, 2002; 72 FR 14239, Mar. 27, 2007; 75 FR 48277, Aug. 10, 2010; 80 FR 56929, Sept. 21, 2015; 83 FR 30586, June 29, 2018; 84 FR 39205, Aug. 9, 2019; 86 FR 27278, May 20, 2021; 88 FR 33837, May 25, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.404-71-4</SECTNO>
                            <SUBJECT>Facilities capital employed.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Description.</E>
                                 This factor focuses on encouraging and rewarding capital investment in facilities that benefit DoD. It recognizes both the facilities capital that the contractor will employ in contract performance and the contractor's commitment to improving productivity.
                            </P>
                            <P>
                                (b) 
                                <E T="03">Contract facilities capital estimates.</E>
                                 The contracting officer shall estimate the facilities capital cost of money and capital employed using—
                            </P>
                            <P>(1) An analysis of the appropriate Forms CASB-CMF and cost of money factors (48 CFR 9904.414 and FAR 31.205-10); and</P>
                            <P>(2) DD Form 1861, Contract Facilities Capital Cost of Money.</P>
                            <P>
                                (c) 
                                <E T="03">Use of DD Form 1861.</E>
                                 See PGI 215.404-71-4(c) for obtaining field pricing support for preparing DD Form 1861.
                            </P>
                            <P>
                                (1) 
                                <E T="03">Purpose.</E>
                                 The DD Form 1861 provides a means of linking the Form CASB-CMF and DD Form 1547, Record of Weighted Guidelines Application. It—
                            </P>
                            <P>(i) Enables the contracting officer to differentiate profit objectives for various types of assets (land, buildings, equipment). The procedure is similar to applying overhead rates to appropriate overhead allocation bases to determine contract overhead costs.</P>
                            <P>(ii) Is designed to record and compute the contract facilities capital cost of money and capital employed which is carried forward to DD Form 1547.</P>
                            <P>
                                (2) 
                                <E T="03">Completion instructions.</E>
                                 Complete a DD Form 1861 only after evaluating the contractor's cost proposal, establishing cost of money factors, and establishing a prenegotiation objective on cost. Complete the form as follows:
                            </P>
                            <P>(i) List overhead pools and direct-charging service centers (if used) in the same structure as they appear on the contractor's cost proposal and Form CASB-CMF. The structure and allocation base units-of-measure must be compatible on all three displays.</P>
                            <P>(ii) Extract appropriate contract overhead allocation base data, by year, from the evaluated cost breakdown or prenegotiation cost objective and list against each overhead pool and direct-charging service center.</P>
                            <P>(iii) Multiply each allocation base by its corresponding cost of money factor to get the facilities capital cost of money estimated to be incurred each year. The sum of these products represents the estimated contract facilities capital cost of money for the year's effort.</P>
                            <P>(iv) Total contract facilities cost of money is the sum of the yearly amounts.</P>
                            <P>(v) Since the facilities capital cost of money factors reflect the applicable cost of money rate in Column 1 of Form CASB-CMF, divide the contract cost of money by that same rate to determine the contract facilities capital employed.</P>
                            <P>
                                (d) 
                                <E T="03">Preaward facilities capital applications.</E>
                                 To establish cost and price objectives, apply the facilities capital cost of money and capital employed as follows:
                            </P>
                            <P>
                                (1) 
                                <E T="03">Cost of Money.</E>
                                 (i) 
                                <E T="03">Cost Objective.</E>
                                 Use the imputed facilities capital cost of money, with normal, booked costs, to establish a cost objective or the target cost when structuring an incentive type contract. Do not adjust target costs established at the outset even though actual cost of money rates become available during the period of contract performance.
                            </P>
                            <P>
                                (ii) 
                                <E T="03">Profit Objective.</E>
                                 When measuring the contractor's effort for the purpose of establishing a prenegotiation profit objective, restrict the cost base to normal, booked costs. Do not include cost of money as part of the cost base.
                            </P>
                            <P>
                                (2) 
                                <E T="03">Facilities Capital Employed.</E>
                                 Assess and weight the profit objective for risk associated with facilities capital employed in accordance with the profit guidelines at 215.404-71-4.
                                <PRTPAGE P="123"/>
                            </P>
                            <P>
                                (e) 
                                <E T="03">Determination.</E>
                                 The following extract from the DD Form 1547 has been annotated to explain the process.
                            </P>
                            <GPOTABLE COLS="5" OPTS="L2" CDEF="xs36,r50,12,12,12">
                                <BOXHD>
                                    <CHED H="1">Item</CHED>
                                    <CHED H="1">Contractor facilities capital employed</CHED>
                                    <CHED H="1">Assigned value</CHED>
                                    <CHED H="1">Amount employed</CHED>
                                    <CHED H="1">Profit objective</CHED>
                                </BOXHD>
                                <ROW>
                                    <ENT I="01">26</ENT>
                                    <ENT>Land</ENT>
                                    <ENT>N/A</ENT>
                                    <ENT>(2)</ENT>
                                    <ENT>N/A</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">27</ENT>
                                    <ENT>Buildings</ENT>
                                    <ENT>N/A</ENT>
                                    <ENT>(2)</ENT>
                                    <ENT>N/A</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">28</ENT>
                                    <ENT>Equipment</ENT>
                                    <ENT>(1)</ENT>
                                    <ENT>(2)</ENT>
                                    <ENT>(3)</ENT>
                                </ROW>
                            </GPOTABLE>
                            <P>(1) Select a value from the list in paragraph (f) of this subsection using the evaluation criteria in paragraph (g) of this subsection.</P>
                            <P>(2) Use the allocated facilities capital attributable to land, buildings, and equipment, as derived in DD Form 1861, Contract Facilities Capital Cost of Money.</P>
                            <P>(i) In addition to the net book value of facilities capital employed, consider facilities capital that is part of a formal investment plan if the contractor submits reasonable evidence that—</P>
                            <P>(A) Achievable benefits to DoD will result from the investment; and</P>
                            <P>(B) The benefits of the investment are included in the forward pricing structure.</P>
                            <P>(ii) If the value of intracompany transfers has been included in Block 20 at cost (i.e., excluding general and administrative (G&amp;A) expenses and profit), add to the contractor's allocated facilities capital, the allocated facilities capital attributable to the buildings and equipment of those corporate divisions supplying the intracompany transfers. Do not make this addition if the value of intracompany transfers has been included in Block 20 at price (i.e., including G&amp;A expenses and profit).</P>
                            <P>(3) Multiply (1) by (2).</P>
                            <P>
                                (f) 
                                <E T="03">Values: Normal and designated ranges.</E>
                            </P>
                            <GPOTABLE COLS="3" OPTS="L2" CDEF="s25,10,xs40">
                                <BOXHD>
                                    <CHED H="1">Asset type</CHED>
                                    <CHED H="1">
                                        Normal
                                        <LI>value</LI>
                                        <LI>(percent)</LI>
                                    </CHED>
                                    <CHED H="1">
                                        Designated
                                        <LI>range</LI>
                                    </CHED>
                                </BOXHD>
                                <ROW>
                                    <ENT I="01">Land</ENT>
                                    <ENT>0</ENT>
                                    <ENT>N/A</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">Buildings</ENT>
                                    <ENT>0</ENT>
                                    <ENT>N/A</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">Equipment</ENT>
                                    <ENT>17.5</ENT>
                                    <ENT>10 to 25</ENT>
                                </ROW>
                            </GPOTABLE>
                            <P>
                                (g) 
                                <E T="03">Evaluation criteria.</E>
                                 (1) In evaluating facilities capital employed, the contracting officer—
                            </P>
                            <P>(i) Should relate the usefulness of the facilities capital to the goods or services being acquired under the prospective contract;</P>
                            <P>(ii) Should analyze the productivity improvements and other anticipated industrial base enhancing benefits resulting from the facilities capital investment, including—</P>
                            <P>(A) The economic value of the facilities capital, such as physical age, undepreciated value, idleness, and expected contribution to future defense needs; and</P>
                            <P>(B) The contractor's level of investment in defense related facilities as compared with the portion of the contractor's total business that is derived from DoD; and</P>
                            <P>(iii) Should consider any contractual provisions that reduce the contractor's risk of investment recovery, such as termination protection clauses and capital investment indemnification.</P>
                            <P>
                                (2) 
                                <E T="03">Above normal conditions.</E>
                                 (i) The contracting officer may assign a higher than normal value if the facilities capital investment has direct, identifiable, and exceptional benefits. Indicators are—
                            </P>
                            <P>(A) New investments in state-of-the-art technology that reduce acquisition cost or yield other tangible benefits such as improved product quality or accelerated deliveries; or</P>
                            <P>(B) Investments in new equipment for research and development applications.</P>
                            <P>(ii) The contracting officer may assign a value significantly above normal when there are direct and measurable benefits in efficiency and significantly reduced acquisition costs on the effort being priced. Maximum values apply only to those cases where the benefits of the facilities capital investment are substantially above normal.</P>
                            <P>
                                (3) 
                                <E T="03">Below normal conditions.</E>
                                 (i) The contracting officer may assign a lower 
                                <PRTPAGE P="124"/>
                                than normal value if the facilities capital investment has little benefit to DoD. Indicators are—
                            </P>
                            <P>(A) Allocations of capital apply predominantly to commercial product lines;</P>
                            <P>(B) Investments are for such things as furniture and fixtures, home or group level administrative offices, corporate aircraft and hangars, gymnasiums; or</P>
                            <P>(C) Facilities are old or extensively idle.</P>
                            <P>(ii) The contracting officer may assign a value significantly below normal when a significant portion of defense manufacturing is done in an environment characterized by outdated, inefficient, and labor-intensive capital equipment.</P>
                            <CITA>[63 FR 55040, Oct. 14, 1998, as amended at 67 FR 20691, Apr. 26, 2002; 67 FR 49255, July 30, 2002; 71 FR 69494, Dec. 1, 2006; 72 FR 14239, Mar. 27, 2007; 73 FR 70906, Nov. 24, 2008; 88 FR 6583, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.404-71-5</SECTNO>
                            <SUBJECT>Cost efficiency factor.</SUBJECT>
                            <P>(a) This special factor provides an incentive for contractors to reduce costs. To the extent that the contractor can demonstrate cost reduction efforts that benefit the pending contract, the contracting officer may increase the prenegotiation profit objective by an amount not to exceed 4 percent of total objective cost (Block 20 of the DD Form 1547) to recognize these efforts (Block 29).</P>
                            <P>(b) To determine if using this factor is appropriate, the contracting officer shall consider criteria, such as the following, to evaluate the benefit the contractor's cost reduction efforts will have on the pending contract:</P>
                            <P>(1) The contractor's participation in Single Process Initiative improvements;</P>
                            <P>(2) Actual cost reductions achieved on prior contracts;</P>
                            <P>(3) Reduction or elimination of excess or idle facilities;</P>
                            <P>(4) The contractor's cost reduction initiatives (e.g., competition advocacy programs, technical insertion programs, obsolete parts control programs, spare parts pricing reform, value engineering, outsourcing of functions such as information technology). Metrics developed by the contractor such as fully loaded labor hours (i.e., cost per labor hour, including all direct and indirect costs) or other productivity measures may provide the basis for assessing the effectiveness of the contractor's cost reduction initiatives over time;</P>
                            <P>(5) The contractor's adoption of process improvements to reduce costs;</P>
                            <P>(6) Subcontractor cost reduction efforts;</P>
                            <P>(7) The contractor's effective incorporation of commercial products or commercial services and commercial processes; or</P>
                            <P>(8) The contractor's investment in new facilities when such investments contribute to better asset utilization or improved productivity.</P>
                            <P>(c) When selecting the percentage to use for this special factor, the contracting officer has maximum flexibility in determining the best way to evaluate the benefit the contractor's cost reduction efforts will have on the pending contract. However, the contracting officer shall consider the impact that quantity differences, learning, changes in scope, and economic factors such as inflation and deflation will have on cost reduction.</P>
                            <CITA>[67 FR 20692, Apr. 26, 2002, as amended at 67 FR 49255, July 30, 2002; 88 FR 6583, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.404-72</SECTNO>
                            <SUBJECT>Modified weighted guidelines method for nonprofit organizations other than FFRDCs.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Definition.</E>
                                 As used in this subpart, a nonprofit organization is a business entity—
                            </P>
                            <P>(1) That operates exclusively for charitable, scientific, or educational purposes;</P>
                            <P>(2) Whose earnings do not benefit any private shareholder or individual;</P>
                            <P>(3) Whose activities do not involve influencing legislation or political campaigning for any candidate for public office; and</P>
                            <P>(4) That is exempted from Federal income taxation under section 501 of the Internal Revenue Code.</P>
                            <P>
                                (b) For nonprofit organizations that are entities that have been identified by the Secretary of Defense or a Secretary of a Department as receiving sustaining support on a cost-plus-fixed-
                                <PRTPAGE P="125"/>
                                fee basis from a particular DoD department or agency, compute a fee objective for covered actions using the weighted guidelines method in 215.404-71, with the following modifications:
                            </P>
                            <P>
                                (1) 
                                <E T="03">Modifications to performance risk (Blocks 21-23 of the DD Form 1547).</E>
                                 (i) If the contracting officer assigns a value from the standard designated range (see 215.404-71-2(c)), reduce the fee objective by an amount equal to 1 percent of the costs in Block 20 of the DD Form 1547. Show the net (reduced) amount on the DD Form 1547.
                            </P>
                            <P>(ii) Do not assign a value from the technology incentive designated range.</P>
                            <P>
                                (2) 
                                <E T="03">Modifications to contract type risk (Block 24 of the DD Form 1547).</E>
                                 Use a designated range of −1 percent to 0 percent instead of the values in 215.404-71-3. There is no normal value.
                            </P>
                            <P>(c) For all other nonprofit organizations except FFRDCs, compute a fee objective for covered actions using the weighted guidelines method in 215.404-71, modified as described in paragraph (b)(1) of this subsection.</P>
                            <CITA>[63 FR 63799, Nov. 17, 1998, as amended at 65 FR 77831, Dec. 13, 2000; 67 FR 20692, Apr. 26, 2002; 67 FR 49255, July 30, 2002]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.404-73</SECTNO>
                            <SUBJECT>Alternate structured approaches.</SUBJECT>
                            <P>(a) The contracting officer may use an alternate structured approach under 215.404-4(c).</P>
                            <P>(b) The contracting officer may design the structure of the alternate, but it shall include—</P>
                            <P>(1) Consideration of the three basic components of profit—performance risk, contract type risk (including working capital), and facilities capital employed. However, the contracting officer is not required to complete Blocks 21 through 30 of the DD Form 1547.</P>
                            <P>(2) Offset for facilities capital cost of money.</P>
                            <P>(i) The contracting officer shall reduce the overall prenegotiation profit objective by the amount of facilities capital cost of money under Cost Accounting Standard (CAS) 414, Cost of Money as an Element of the Cost of Facilities Capital (48 CFR 9904.414). Cost of money under CAS 417, Cost of Money as an Element of the Cost of Capital Assets Under Construction (48 CFR 9904.417), should not be used to reduce the overall prenegotiation profit objective. The profit amount in the negotiation summary of the DD Form 1547 must be net of the offset.</P>
                            <P>(ii) This adjustment is needed for the following reason: The values of the profit factors used in the weighted guidelines method were adjusted to recognize the shift in facilities capital cost of money from an element of profit to an element of contract cost (see FAR 31.205-10) and reductions were made directly to the profit factors for performance risk. In order to ensure that this policy is applied to all DoD contracts that allow facilities capital cost of money, similar adjustments shall be made to contracts that use alternate structured approaches.</P>
                            <CITA>[63 FR 55040, Oct. 14, 1998, as amended at 67 FR 20692, Apr. 26, 2002; 71 FR 69494, Dec. 1, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.404-74</SECTNO>
                            <SUBJECT>Fee requirements for cost-plus-award-fee contracts.</SUBJECT>
                            <P>In developing a fee objective for cost-plus-award-fee contracts, the contracting officer shall—</P>
                            <P>(a) Follow the guidance in FAR 16.405-2 and 216.405-2;</P>
                            <P>(b) Not use the weighted guidelines method or alternate structured approach;</P>
                            <P>(c) Apply the offset policy in 215.404-73(b)(2) for facilities capital cost of money, i.e., reduce the base fee by the amount of facilities capital cost of money; and</P>
                            <P>(d) Not complete a DD Form 1547.</P>
                            <CITA>[63 FR 55040, Oct. 14, 1998, as amended at 67 FR 20692, Apr. 26, 2002]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.404-75</SECTNO>
                            <SUBJECT>Fee requirements for FFRDCs.</SUBJECT>
                            <P>For nonprofit organizations that are FFRDCs, the contracting officer—</P>
                            <P>(a) Should consider whether any fee is appropriate. Considerations shall include the FFRDC's—</P>
                            <P>(1) Proportion of retained earnings (as established under generally accepted accounting methods) that relates to DoD contracted effort;</P>
                            <P>(2) Facilities capital acquisition plans;</P>
                            <P>
                                (3) Working capital funding as assessed on operating cycle cash needs; and
                                <PRTPAGE P="126"/>
                            </P>
                            <P>(4) Provision for funding unreimbursed costs deemed ordinary and necessary to the FFRDC.</P>
                            <P>(b) Shall, when a fee is considered appropriate, establish the fee objective in accordance with FFRDC fee policies in the DoD Instruction 5000.77, DoD Federally Funded Research and Development Center Program.</P>
                            <P>(c) Shall not use the weighted guidelines method or an alternate structured approach.</P>
                            <CITA>[63 FR 63800, Nov. 17, 1998, as amended at 88 FR 80466, Nov. 17, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.406</SECTNO>
                            <SUBJECT>Documentation.</SUBJECT>
                        </SECTION>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>88 FR 73236, Oct. 25, 2023, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>215.406-1</SECTNO>
                            <SUBJECT>Prenegotiation objectives.</SUBJECT>
                            <P>Follow the procedures at PGI 215.406-1 for establishing prenegotiation objectives.</P>
                            <CITA>[71 FR 69494, Dec. 1, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.406-2</SECTNO>
                            <SUBJECT>Certificate of current cost or pricing data.</SUBJECT>
                            <P>See PGI 215.406-2 for additional information and guidance on Certificates of Current Cost or Pricing Data.</P>
                            <CITA>[88 FR 73236, Oct. 25, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.406-3</SECTNO>
                            <SUBJECT>Documenting the negotiation.</SUBJECT>
                            <P>Follow the procedures at PGI 215.406-3 for documenting the negotiation and uploading sole source business clearance documentation into the Contract Business Analysis Repository.</P>
                            <CITA>[78 FR 21850, Apr. 12, 2013]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.407</SECTNO>
                            <SUBJECT>Special cost or pricing areas.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.407-1</SECTNO>
                            <SUBJECT>Defective certified cost or pricing data.</SUBJECT>
                            <P>
                                (c)(i) When a contractor voluntarily discloses defective pricing after contract award, the contracting officer shall discuss the disclosure with the Defense Contract Audit Agency (DCAA). This discussion will assist in the contracting officer determining the involvement of DCAA, which could be a limited-scope audit (
                                <E T="03">e.g.,</E>
                                 limited to the affected cost elements of the defective pricing disclosure), a full-scope audit, or technical assistance as appropriate for the circumstances (
                                <E T="03">e.g.,</E>
                                 nature or dollar amount of the defective pricing disclosure). At a minimum, the contracting officer shall discuss with DCAA the following:
                            </P>
                            <P>(A) Completeness of the contractor's voluntary disclosure on the affected contract.</P>
                            <P>(B) Accuracy of the contractor's cost impact calculation for the affected contract.</P>
                            <P>(C) Potential impact on existing contracts, task or deliver orders, or other proposals the contractor has submitted to the Government.</P>
                            <P>(ii) Voluntary disclosure of defective pricing is not a voluntary refund as defined in 242.7100 and does not waive the Government entitlement to the recovery of any overpayment plus interest on the overpayments in accordance with FAR 15.407-1(b)(7).</P>
                            <P>(iii) Voluntary disclosure of defective pricing does not waive the Government's rights to pursue defective pricing claims on the affected contract or any other Government contract.</P>
                            <CITA>[83 FR 19647, May 4, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.407-2</SECTNO>
                            <SUBJECT>Make-or-buy programs.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">General.</E>
                                 See PGI 215.407-2 for guidance on factors to consider when deciding whether to request a make-or-buy plan and for factors to consider when evaluating make-or-buy plan submissions.
                            </P>
                            <P>
                                (e) 
                                <E T="03">Program requirements</E>
                                —(1) 
                                <E T="03">Items and work included.</E>
                                 The minimum dollar amount is $1.5 million.
                            </P>
                            <CITA>[63 FR 55040, Oct. 14, 1998, as amended at 75 FR 45073, Aug. 2, 2010; 76 FR 76319, Dec. 7, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.407-3</SECTNO>
                            <SUBJECT>Forward pricing rate agreements.</SUBJECT>
                            <P>(b)(i) Use forward pricing rate agreement (FPRA) rates when such rates are available, unless waived on a case-by-case basis by the head of the contracting activity.</P>
                            <P>(ii) Advise the ACO of each case waived.</P>
                            <P>(iii) Contact the ACO for questions on FPRAs or recommended rates.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.407-4</SECTNO>
                            <SUBJECT>Should-cost review.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">General.</E>
                                 See PGI 215.407-4 for guidance on determining whether to 
                                <PRTPAGE P="127"/>
                                perform a program or overhead should-cost review.
                            </P>
                            <P>
                                (b) 
                                <E T="03">Program should-cost review.</E>
                                 Major weapon system should-cost program reviews shall be conducted in a manner that is transparent, objective, and provides for the efficiency of the DoD systems acquisition process (section 837 of the National Defense Authorization Act for Fiscal Year 2018 (Pub. L. 115-91)).
                            </P>
                            <P>(i) Major weapon system should-cost reviews may include the following features:</P>
                            <P>(A) A thorough review of each contributing element of the program cost and the justification for each cost.</P>
                            <P>(B) An analysis of non-value added overhead and unnecessary reporting requirements.</P>
                            <P>(C) Benchmarking against similar DoD programs, similar commercial programs (where appropriate), and other programs by the same contractor at the same facility.</P>
                            <P>(D) An analysis of supply chain management to encourage competition and incentive cost performance at lower tiers.</P>
                            <P>(E) A review of how to restructure the program (Government and contractor) team in a streamlined manner, if necessary.</P>
                            <P>(F) Identification of opportunities to break out Government-furnished equipment versus prime contractor-furnished materials.</P>
                            <P>(G) Identification of items or services contracted through third parties that result in unnecessary pass-through costs.</P>
                            <P>(H) Evaluation of ability to use integrated developmental and operational testing and modeling and simulation to reduce overall costs.</P>
                            <P>(I) Identification of alternative technology and materials to reduce developmental or lifecycle costs for a program.</P>
                            <P>(J) Identification and prioritization of cost savings opportunities.</P>
                            <P>(K) Establishment of measurable targets and ongoing tracking systems.</P>
                            <P>(ii) The should-cost review shall provide for sufficient analysis while minimizing the impact on program schedule by engaging stakeholders early, relying on information already available before requesting additional data, and establishing a team with the relevant expertise early.</P>
                            <P>(iii) The should-cost review team shall be comprised of members, including third-party experts if necessary, with the training, skills, and experience in analysis of cost elements, production or sustainment processes, and technologies relevant to the program under review. The review team may include members from the Defense Contract Management Agency, the department or agency's cost analysis center, and appropriate functional organizations, as necessary.</P>
                            <P>(iv) The should-cost review team shall establish a process for communicating and collaborating with the contractor throughout the should-cost review, including notification to the contractor regarding which elements of the contractor's operations will be reviewed and what information will be necessary to perform the review, as soon as practicable, both prior to and during the review.</P>
                            <P>(v) The should-cost review team report shall ensure, to the maximum extent practicable, review of current, accurate, and complete data, and shall identify cost savings opportunities associated with specific engineering or business changes that can be quantified and tracked.</P>
                            <CITA>[71 FR 69495, Dec. 1, 2006, as amended at 84 FR 65309, Nov. 27, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.407-5</SECTNO>
                            <SUBJECT>Estimating systems.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.407-5-70</SECTNO>
                            <SUBJECT>Disclosure, maintenance, and review requirements.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Definitions.</E>
                                 (1) 
                                <E T="03">Acceptable estimating system</E>
                                 is defined in the clause at 252.215-7002, Cost Estimating System Requirements.
                            </P>
                            <P>
                                (2) 
                                <E T="03">Contractor</E>
                                 means a business unit as defined in FAR 2.101.
                            </P>
                            <P>
                                (3) 
                                <E T="03">Estimating system</E>
                                 is as defined in the clause at 252.215-7002, Cost Estimating System Requirements.
                            </P>
                            <P>
                                (4) 
                                <E T="03">Significant deficiency</E>
                                 is defined in the clause at 252.215-7002, Cost Estimating System Requirements.
                            </P>
                            <P>
                                (b) 
                                <E T="03">Applicability.</E>
                                 (1) DoD policy is that all contractors have acceptable estimating systems that consistently produce well-supported proposals that are acceptable as a basis for negotiation of fair and reasonable prices.
                                <PRTPAGE P="128"/>
                            </P>
                            <P>(2) A large business contractor is subject to estimating system disclosure, maintenance, and review requirements if—</P>
                            <P>(i) In its preceding fiscal year, the contractor received DoD prime contracts or subcontracts totaling $50 million or more for which certified cost or pricing data were required; or</P>
                            <P>(ii) In its preceding fiscal year, the contractor received DoD prime contracts or subcontracts totaling $10 million or more (but less than $50 million) for which certified cost or pricing data were required and the contracting officer, with concurrence or at the request of the ACO, determines it to be in the best interest of the Government (e.g., significant estimating problems are believed to exist or the contractor's sales are predominantly Government).</P>
                            <P>
                                (c) 
                                <E T="03">Policy.</E>
                                 (1) The contracting officer shall—
                            </P>
                            <P>(i) Through use of the clause at 252.215-7002, Cost Estimating System Requirements, apply the disclosure, maintenance, and review requirements to large business contractors meeting the criteria in paragraph (b)(2)(i) of this section;</P>
                            <P>(ii) Consider whether to apply the disclosure, maintenance, and review requirements to large business contractors under paragraph (b)(2)(ii) of this section; and</P>
                            <P>(iii) Not apply the disclosure, maintenance, and review requirements to other than large business contractors.</P>
                            <P>(2) The cognizant contracting officer, in consultation with the auditor, for contractors subject to paragraph (b)(2) of this section, shall—</P>
                            <P>(i) Determine the acceptability of the disclosure and approve or disapprove the system: and</P>
                            <P>(ii) Pursue correction of any deficiencies.</P>
                            <P>(3) The auditor conducts estimating system reviews.</P>
                            <P>(4) An acceptable system shall provide for the use of appropriate source data, utilize sound estimating techniques and good judgment, maintain a consistent approach, and adhere to established policies and procedures.</P>
                            <P>(5) In evaluating the acceptability of a contractor's estimating system, the contracting officer, in consultation with the auditor, shall determine whether the contractor's estimating system complies with the system criteria for an acceptable estimating system as prescribed in the clause at 252.215-7002, Cost Estimating System Requirements.</P>
                            <P>
                                (d) 
                                <E T="03">Disposition of findings</E>
                                —(1) 
                                <E T="03">Reporting of findings.</E>
                                 The auditor shall document findings and recommendations in a report to the contracting officer. If the auditor identifies any significant estimating system deficiencies, the report shall describe the deficiencies in sufficient detail to allow the contracting officer to understand the deficiencies.
                            </P>
                            <P>
                                (2) 
                                <E T="03">Initial determination.</E>
                                 (i) The contracting officer shall review all findings and recommendations and, if there are no significant deficiencies, shall promptly notify the contractor, in writing, that the contractor's estimating system is acceptable and approved; or
                            </P>
                            <P>(ii) If the contracting officer finds that there are one or more significant deficiencies (as defined in the clause at 252.215-7002, Cost Estimating System Requirements) due to the contractor's failure to meet one or more of the estimating system criteria in the clause at 252.215-7002, the contracting officer shall—</P>
                            <P>(A) Promptly make an initial written determination on any significant deficiencies and notify the contractor, in writing, providing a description of each significant deficiency in sufficient detail to allow the contractor to understand the deficiency;</P>
                            <P>(B) Request the contractor to respond in writing to the initial determination within 30 days; and</P>
                            <P>(C) Promptly evaluate the contractor's responses to the initial determination, in consultation with the auditor or functional specialist, and make a final determination.</P>
                            <P>
                                (3) 
                                <E T="03">Final determination.</E>
                                 (i) The contracting officer shall make a final determination and notify the contractor in writing that—
                            </P>
                            <P>(A) The contractor's estimating system is acceptable and approved, and no significant deficiencies remain, or</P>
                            <P>
                                (B) Significant deficiencies remain. The notice shall identify any remaining significant deficiencies, and indicate the adequacy of any proposed or 
                                <PRTPAGE P="129"/>
                                completed corrective action. The contracting officer shall—
                            </P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Request that the contractor, within 45 days of receipt of the final determination, either correct the deficiencies or submit an acceptable corrective action plan showing milestones and actions to eliminate the deficiencies;
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Disapprove the system in accordance with the clause at 252.215-7002, Cost Estimating System Requirements; and
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) Withhold payments in accordance with the clause at 252.242-7005, Contractor Business Systems, if the clause is included in the contract.
                            </P>
                            <P>(ii) Follow the procedures relating to monitoring a contractor's corrective action and the correction of significant deficiencies in PGI 215.407-5-70(e).</P>
                            <P>
                                (e) 
                                <E T="03">System approval.</E>
                                 The contracting officer shall promptly approve a previously disapproved estimating system and notify the contractor when the contracting officer determines that there are no remaining significant deficiencies.
                            </P>
                            <P>
                                (f) 
                                <E T="03">Contracting officer notifications.</E>
                                 The cognizant contracting officer shall promptly distribute copies of a determination to approve a system, disapprove a system and withhold payments, or approve a previously disapproved system and release withheld payments, to the auditor; payment office; affected contracting officers at the buying activities; and cognizant contracting officers in contract administration activities.
                            </P>
                            <CITA>[63 FR 55040, Oct. 14, 1998, as amended at 67 FR 49252, July 30, 2002; 71 FR 69495, Dec. 1, 2006; 76 FR 28866, May 18, 2011; 77 FR 11365, Feb. 24, 2012; 77 FR 76940, Dec. 31, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.408</SECTNO>
                            <SUBJECT>Solicitation provisions and contract clauses.</SUBJECT>
                            <P>(1) Use the clause at 252.215-7002, Cost Estimating System requirements, in all solicitations and contracts to be awarded on the basis of certified cost or pricing data.</P>
                            <P>(2) When contracting with the Canadian Commercial Corporation—</P>
                            <P>(i)(A) Use the provision at 252.215-7003, Requirement for Submission of Data Other Than Certified Cost or Pricing Data—Canadian Commercial Corporation—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) In lieu of 252.215-7010, Requirements for Certified Cost or Pricing Data and Data Other Than Certified Cost or Pricing Data, in a solicitation, including solicitations using FAR part 12 procedures for the acquisition of commercial products and commercial services, for a sole source acquisition from the Canadian Commercial Corporation that is—
                            </P>
                            <P>
                                (
                                <E T="03">i</E>
                                ) Cost-reimbursement, if the contract value is expected to exceed $700,000; or
                            </P>
                            <P>
                                (
                                <E T="03">ii</E>
                                ) Fixed-price, if the contract value is expected to exceed $500 million; or
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) In lieu of 252.215-7010, in a solicitation, including solicitations using FAR part 12 procedures for the acquisition of commercial products and commercial services, for a sole source acquisition from the Canadian Commercial Corporation that does not meet the thresholds specified in paragraph (2)(i)(A)(
                                <E T="03">1</E>
                                ) of this section, if approval is obtained as required at 225.870-4(c)(2)(ii); and
                            </P>
                            <P>(B) Do not use 252.225-7003 in lieu of 252.215-7010 in competitive acquisitions; and</P>
                            <P>(ii)(A) Use the clause at 252.215-7004, Requirement for Submission of Data Other Than Certified Cost or Pricing Data—Modifications—Canadian Commercial Corporation—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) In a solicitation, including solicitations using FAR part 12 procedures for the acquisition of commercial products and commercial services, for a sole source acquisition, from the Canadian Commercial Corporation and resultant contract that is—
                            </P>
                            <P>
                                (
                                <E T="03">i</E>
                                ) Cost-reimbursement, if the contract value is expected to exceed $700,000; or
                            </P>
                            <P>
                                (
                                <E T="03">ii</E>
                                ) Fixed-price, if the contract value is expected to exceed $500 million;
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) In a solicitation, including solicitations using FAR part 12 procedures for the acquisition of commercial products and commercial services, for a sole source acquisition from the Canadian Commercial Corporation and resultant contract that does not meet the thresholds specified in paragraph (2)(ii)(A)(
                                <E T="03">1</E>
                                ) of this section, if approval is obtained as required at 225.870-4(c)(2)(ii); or
                                <PRTPAGE P="130"/>
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                )(
                                <E T="03">i</E>
                                ) In a solicitation, including solicitations using FAR part 12 procedures for the acquisition of commercial products and commercial services, for a competitive acquisition that includes FAR 52.215-21, Requirement for Data Other Than Certified Cost or Pricing Data—Modifications, or that meets the thresholds specified in paragraph (2)(ii)(A)(
                                <E T="03">1</E>
                                ) of this section.
                            </P>
                            <P>
                                (
                                <E T="03">ii</E>
                                ) The contracting officer shall then select the appropriate clause to include in the contract (52.215-21 only if award is not to the Canadian Commercial Corporation; or 252.215-7004 if award is to the Canadian Commercial Corporation and necessary approval is obtained in accordance with 225.870-4(c)(2)(ii)); and
                            </P>
                            <P>(B) The contracting officer may specify a higher threshold in paragraph (b) of the clause 252.215-7004.</P>
                            <P>(3) Use the provision at 252.215-7008, Only One Offer, in competitive solicitations that exceed the simplified acquisition threshold, including solicitations using FAR part 12 procedures for the acquisition of commercial products and commercial services.</P>
                            <P>(4) When the solicitation requires the submission of certified cost or pricing data, the contracting officer should include 252.215-7009, Proposal Adequacy Checklist, in the solicitation to facilitate submission of a thorough, accurate, and complete proposal.</P>
                            <P>(5) When reasonably certain that the submission of certified cost or pricing data or data other than certified cost or pricing data will be required or when using the provision at 252.215-7008—</P>
                            <P>(i) Use the basic or alternate of the provision at 252.215-7010, Requirements for Certified Cost or Pricing Data and Data Other Than Certified Cost or Pricing Data, in lieu of the provision at FAR 52.215-20, Requirements for Certified Cost or Pricing Data and Data Other Than Certified Cost or Pricing Data, in solicitations, including solicitations using FAR part 12 procedures for the acquisition of commercial products and commercial services.</P>
                            <P>(A) Use the basic provision when submission of certified cost or pricing data is required to be in the FAR Table 15-2 format, or if it is anticipated, at the time of solicitation, that the submission of certified cost or pricing data may not be required.</P>
                            <P>(B) Use the alternate I provision to specify a format for certified cost or pricing data other than the format required by FAR Table 15-2;</P>
                            <P>(ii) Use the provision at 252.215-7011, Requirements for Submission of Proposals to the Administrative Contracting Officer and Contract Auditor, when using the basic or alternate of the provision at 252.215-7010 and copies of the proposal are to be sent to the ACO and contract auditor; and</P>
                            <P>(iii) Use the provision at 252.215-7012, Requirements for Submission of Proposals via Electronic Media, when using the basic or alternate of the provision at 252.215-7010 and submission via electronic media is required.</P>
                            <P>(6) Use the provision at 252.215-7013, Supplies and Services Provided by Nontraditional Defense Contractors, in all solicitations.</P>
                            <P>(7) Use the clause at 252.215-7014, Exception from Certified Cost or Pricing Data Requirements for Foreign Military Sales Indirect Offsets, in solicitations and contracts that contain the provision at 252.215-7010, Requirements for Certified Cost or Pricing Data and Data Other Than Certified Cost or Pricing Data, when it is reasonably certain that—</P>
                            <P>(i) The contract is expected to include costs associated with an indirect offset; and</P>
                            <P>(ii) The submission of certified cost or pricing data or data other than certified cost or pricing data will be required.</P>
                            <P>(8) Use the clause at 252.215-7015, Program Should-Cost Review, in all solicitations and contracts for the development or production of a major weapon system, as defined in 234.7001.</P>
                            <CITA>[63 FR 55040, Oct. 14, 1998]</CITA>
                            <EDNOTE>
                                <HD SOURCE="HED">Editorial Note:</HD>
                                <P>
                                    For 
                                    <E T="04">Federal Register</E>
                                     citations affecting section 215.408, see the List of CFR Sections Affected, which appears in the Finding Aids section of the printed volume and at 
                                    <E T="03">www.govinfo.gov.</E>
                                </P>
                            </EDNOTE>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.470</SECTNO>
                            <SUBJECT>Estimated data prices.</SUBJECT>
                            <P>
                                (a) DoD requires estimates of the prices of data in order to evaluate the cost to the Government of data items in terms of their management, product, or engineering value.
                                <PRTPAGE P="131"/>
                            </P>
                            <P>(b) When data are required to be delivered under a contract, include DD Form 1423, Contract Data Requirements List, in the solicitation. See PGI 215.470(b) for guidance on the use of DD Form 1423.</P>
                            <P>(c) The contracting officer shall ensure that the contract does not include a requirement for data that the contractor has delivered or is obligated to deliver to the government under another contract or subcontract, and that the successful offeror identifies any such data required by the solicitation. However, where duplicate data are desired, the contract price shall include the costs of duplication, but not of preparation, of such data.</P>
                            <CITA>[63 FR 55040, Oct. 14, 1998, as amended at 71 FR 69495, Dec. 1, 2006]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 215.5—Preaward, Award, and Postaward Notifications, Protests, and Mistakes</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>78 FR 69270, Nov. 18, 2013, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>215.503</SECTNO>
                            <SUBJECT>Notifications to unsuccessful offerors.</SUBJECT>
                            <P>If the Government exercises the authority provided in 239.7305(d), the notifications to unsuccessful offerors, either preaward or postaward, shall not reveal any information that is determined to be withheld from disclosure in accordance with 10 U.S.C. 3252 (see subpart 239.73).</P>
                            <CITA>[78 FR 69270, Nov. 18, 2013, as amended at 84 FR 4369, Feb. 15, 2019; 87 FR 76992, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.506</SECTNO>
                            <SUBJECT>Postaward debriefing of offerors.</SUBJECT>
                            <P>(b) Notwithstanding FAR 15.506(b), when requested by a successful or unsuccessful offeror, a written or oral debriefing is required for contract awards valued at $10 million or more (section 818 of the National Defense Authorization Act for Fiscal Year 2018 (Pub. L. 115-91)).</P>
                            <P>(c) [Reserved]</P>
                            <P>(d) In addition to the requirements of FAR 15.506(d), the minimum debriefing information shall include the following:</P>
                            <P>(i) For award of a contract in excess of $10 million and not in excess of $100 million with a small business or nontraditional defense contractor, an option for the small business or nontraditional defense contractor to request disclosure of the agency's written source selection decision document, redacted to protect the confidential and proprietary information of other offerors for the contract award.</P>
                            <P>(ii) For award of a contract in excess of $100 million, disclosure of the agency's written source selection decision document, redacted to protect the confidential and proprietary information of other offerors for the contract award.</P>
                            <P>(e) If the Government exercises the authority provided in 239.7305(d), the debriefing shall not reveal any information that is determined to be withheld from disclosure in accordance with 10 U.S.C. 3252 (see subpart 239.73).</P>
                            <CITA>[78 FR 69270, Nov. 18, 2013, as amended at 84 FR 4369, Feb. 15, 2019; 87 FR 15810, Mar. 18, 2022; 87 FR 76992, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.506-70</SECTNO>
                            <SUBJECT>Opportunity for follow-up questions.</SUBJECT>
                            <P>When providing a required postaward debriefing to successful and unsuccessful offerors, contracting officers shall—</P>
                            <P>(a) Provide an opportunity to submit additional written questions related to the required debriefing not later than 2 business days after receiving the postaward debriefing;</P>
                            <P>(b) Respond in writing to timely submitted additional questions within 5 business days after receipt of the questions; and</P>
                            <P>(c) Not consider the postaward debriefing to be concluded until the later of—</P>
                            <P>(1) The date that the postaward debriefing is delivered, orally or in writing; or</P>
                            <P>(2) If additional written questions related to the debriefing are timely received, the date the agency delivers its written response.</P>
                            <CITA>[87 FR 15810, Mar. 18, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.570</SECTNO>
                            <SUBJECT>Solicitation provision.</SUBJECT>
                            <P>
                                Use the provision at 252.215-7016, Notification to Offerors—Postaward Debriefings, in competitive negotiated 
                                <PRTPAGE P="132"/>
                                solicitations for contract awards valued at $10 million or more, including solicitations using FAR part 12 procedures for the acquisition of commercial products and commercial services.
                            </P>
                            <CITA>[87 FR 15810, Mar. 18, 2022, as amended at 88 FR 6583, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 215.6—Unsolicited Proposals</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>88 FR 55940, Aug. 17, 2023, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>215.602</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>The policy at FAR 15.602 applies to commercial solutions openings.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>215.604</SECTNO>
                            <SUBJECT>Agency points of contact.</SUBJECT>
                            <P>(a)(3) The guidance at FAR 15.604(a)(3) applies to commercial solutions openings.</P>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 216</EAR>
                    <HD SOURCE="HED">PART 216—TYPES OF CONTRACTS</HD>
                    <CONTENTS>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 216.1—Selecting Contract Types</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>216.102</SECTNO>
                            <SUBJECT>Policies.</SUBJECT>
                            <SECTNO>216.104</SECTNO>
                            <SUBJECT>Factors in selecting contract type.</SUBJECT>
                            <SECTNO>216.104-70</SECTNO>
                            <SUBJECT>Research and development.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 216.2—Fixed-Price Contracts</HD>
                            <SECTNO>216.203</SECTNO>
                            <SUBJECT>Fixed-price contracts with economic price adjustment.</SUBJECT>
                            <SECTNO>216.203-4</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <SECTNO>216.203-4-70</SECTNO>
                            <SUBJECT>Additional provisions and clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 216.3—Cost-Reimbursement Contracts</HD>
                            <SECTNO>216.301-3</SECTNO>
                            <SUBJECT>Limitations.</SUBJECT>
                            <SECTNO>216.306</SECTNO>
                            <SUBJECT>Cost-plus-fixed-fee contracts.</SUBJECT>
                            <SECTNO>216.307</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 216.4—Incentive Contracts</HD>
                            <SECTNO>216.401</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>216.401-71</SECTNO>
                            <SUBJECT>Objective criteria.</SUBJECT>
                            <SECTNO>216.402</SECTNO>
                            <SUBJECT>Application of predetermined, formula-type incentives.</SUBJECT>
                            <SECTNO>216.402-2</SECTNO>
                            <SUBJECT>Performance incentives.</SUBJECT>
                            <SECTNO>216.403</SECTNO>
                            <SUBJECT>Fixed-price incentive contracts.</SUBJECT>
                            <SECTNO>216.403-1 </SECTNO>
                            <SUBJECT>Fixed-price incentive (firm target) contracts.</SUBJECT>
                            <SECTNO>216.403-2</SECTNO>
                            <SUBJECT>Fixed-price incentive (successive targets) contracts.</SUBJECT>
                            <SECTNO>216.405</SECTNO>
                            <SUBJECT>Cost-reimbursement incentive contracts.</SUBJECT>
                            <SECTNO>216.405-1</SECTNO>
                            <SUBJECT>Cost-plus-incentive-fee contracts.</SUBJECT>
                            <SECTNO>216.405-2</SECTNO>
                            <SUBJECT>Cost-plus-award-fee contracts.</SUBJECT>
                            <SECTNO>216.405-2-70</SECTNO>
                            <SUBJECT>Award fee reduction or denial for jeopardizing the health or safety of Government personnel.</SUBJECT>
                            <SECTNO>216.405-2-71</SECTNO>
                            <SUBJECT>Award fee reduction or denial for failure to comply with requirements relating to performance of private security functions.</SUBJECT>
                            <SECTNO>216.406</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <SECTNO>216.470</SECTNO>
                            <SUBJECT>Other applications of award fees.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 216.5—Indefinite-Delivery Contracts</HD>
                            <SECTNO>216.501-2-70</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>216.504</SECTNO>
                            <SUBJECT>Indefinite-quantity contracts.</SUBJECT>
                            <SECTNO>216.505</SECTNO>
                            <SUBJECT>Ordering.</SUBJECT>
                            <SECTNO>216.505-70</SECTNO>
                            <SUBJECT>Orders under multiple-award contracts.</SUBJECT>
                            <SECTNO>216.506</SECTNO>
                            <SUBJECT>Solicitation provisions and contract clauses.</SUBJECT>
                            <SECTNO>216.506-70</SECTNO>
                            <SUBJECT>Additional solicitation provisions and contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 216.6—Time-and-Materials, Labor-Hour, and Letter Contracts</HD>
                            <SECTNO>216.601</SECTNO>
                            <SUBJECT>Time-and-materials contracts.</SUBJECT>
                            <SECTNO>216.603</SECTNO>
                            <SUBJECT>Letter contracts.</SUBJECT>
                            <SECTNO>216.603-2</SECTNO>
                            <SUBJECT>Application.</SUBJECT>
                            <SECTNO>216.603-3</SECTNO>
                            <SUBJECT>Limitations.</SUBJECT>
                            <SECTNO>216.603-4</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 216.7—Agreements</HD>
                            <SECTNO>216.703</SECTNO>
                            <SUBJECT>Basic ordering agreements.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36340, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 216.1—Selecting Contract Types</HD>
                        <SECTION>
                            <SECTNO>216.102</SECTNO>
                            <SUBJECT>Policies.</SUBJECT>
                            <P>In accordance with section 811 of the National Defense Authorization Act for Fiscal Year 2013 (Pub. L. 112-239), use of any cost-reimbursement line item for the acquisition of production of major defense acquisition programs is prohibited, unless the exception at 234.004(2)(ii) applies.</P>
                            <CITA>[87 FR 65513, Oct. 28, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>216.104</SECTNO>
                            <SUBJECT>Factors in selecting contract type.</SUBJECT>
                            <P>
                                Contracting officers shall follow the principles and procedures in Director, Defense Procurement and Acquisition Policy memorandum dated April 1, 2016, entitled “Guidance on Using Incentive and Other Contract Types,” 
                                <PRTPAGE P="133"/>
                                when selecting and negotiating the most appropriate contract type for a given procurement. See PGI 216.104.
                            </P>
                            <CITA>[81 FR 28730, May 10, 2016]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>216.104-70</SECTNO>
                            <SUBJECT>Research and development.</SUBJECT>
                            <P>Follow the procedures at PGI 216.104-70 for selecting the appropriate research and development contract type, and see 235.006(b) for additional approval requirements.</P>
                            <CITA>[71 FR 39007, July 11, 2006, as amended at 84 FR 65307, Nov. 27, 2019]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 216.2—Fixed-Price Contracts</HD>
                        <SECTION>
                            <SECTNO>216.203</SECTNO>
                            <SUBJECT>Fixed-price contracts with economic price adjustment.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>216.203-4</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>(1) Generally, use the clauses at FAR 52.216-2, Economic Price Adjustment—Standard Supplies, FAR 52.216-3, Economic Price Adjustment—Semistandard Supplies, and FAR 52.216-4, Economic Price Adjustment—Labor and Material, only when—</P>
                            <P>(i) The total contract price exceeds the simplified acquisition threshold; and</P>
                            <P>(ii) Delivery or performance will not be completed within 6 months after contract award.</P>
                            <P>(2) Follow the procedures at PGI 216.203-4 when using an economic price adjustment clause based on cost indexes of labor or material.</P>
                            <CITA>[71 FR 39007, July 11, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>216.203-4-70</SECTNO>
                            <SUBJECT>Additional provisions and clauses.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Price adjustment for basic steel, aluminum, brass, bronze, or copper mill products.</E>
                                 (1)(i) The price adjustment clause at 252.216-7000, Economic Price Adjustment—Basic Steel, Aluminum, Brass, Bronze, or Copper Mill Products, may be used in fixed-price supply solicitations and contracts for basic steel, aluminum, brass, bronze, or copper mill products, such as sheets, plates, and bars, when an established catalog or market price exists for the particular product being acquired.
                            </P>
                            <P>(ii) The 10 percent figure in paragraph (d)(1) of the clause shall not be exceeded unless approval is obtained at a level above the contracting officer.</P>
                            <P>(2) Use the price adjustment provision at 252.216-7007, Economic Price Adjustment—Basic Steel, Aluminum, Brass, Bronze, or Copper Mill Products—Representation, in solicitations that include the clause at 252.216-7000, Economic Price Adjustment—Basic Steel, Aluminum, Brass, Bronze, or Copper Mill Products.</P>
                            <P>
                                (b) 
                                <E T="03">Price adjustment for nonstandard steel items.</E>
                                 (1) The price adjustment clause at 252.216-7001, Economic Price Adjustment—Nonstandard Steel Items, may be used in fixed-price supply contracts when—
                            </P>
                            <P>(i) The contractor is a steel producer and actually manufacture the standard steel mill item referred to in the “base steel index” definition of the clause; and</P>
                            <P>(ii) The items being acquired are nonstandard steel items made wholly or in part of standard steel mill items.</P>
                            <P>(2) When this clause is included in invitations for bids, omit Note 6 of the clause and all references to Note 6.</P>
                            <P>(3) Solicitations shall instruct offerors to complete all blanks in accordance with the applicable notes.</P>
                            <P>(4) When the clause is to provide for adjustment on a basis other than “established price” (see Note 6 of the clause), that price must be verified.</P>
                            <P>(5) The ten percent figure in paragraph (e)(4) of the clause shall not be exceeded unless approval is obtained at a level above the contracting officer.</P>
                            <P>
                                (c) 
                                <E T="03">Price adjustment for wage rates or material prices controlled by a foreign government.</E>
                                 (1)(i) The price adjustment clause at 252.216-7003, Economic Price Adjustment—Wage Rates or Material Prices Controlled by a Foreign Government, may be used in fixed-price supply and service solicitations and contracts when—
                            </P>
                            <P>(A) The contract is to be performed wholly or in part in a foreign country; and</P>
                            <P>(B) A foreign government controls wage rates or material prices and may, during contract performance, impose a mandatory change in wages or prices of material.</P>
                            <P>
                                (ii) Verify the base wage rates and material prices prior to contract award 
                                <PRTPAGE P="134"/>
                                and prior to making any adjustment in the contract price.
                            </P>
                            <P>(2) Use the provision at 252.216-7008, Economic Price Adjustment-Wage Rates or Material Prices Controlled by a Foreign Government—Representation, in solicitations that include the clause at 252.216-7003, Economic Price Adjustment-Wage Rates or Material Prices Controlled by a Foreign Government. If the solicitation includes the provision at FAR 52.204-7, do not separately list the provision 252.216-7008 in the solicitation.</P>
                            <CITA>[56 FR 36340, July 31, 1991, as amended at 62 FR 34122, June 24, 1997; 62 FR 40472, July 29, 1997; 77 FR 19129, Mar. 30, 2012; 78 FR 37986, June 25, 2013, 78 FR 40043, July 3, 2013]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 216.3—Cost-Reimbursement Contracts</HD>
                        <SECTION>
                            <SECTNO>216.301-3</SECTNO>
                            <SUBJECT>Limitations.</SUBJECT>
                            <P>For contracts in connection with a military construction project or a military family housing project, contracting officers shall not use cost-plus-fixed-fee, cost-plus-award-fee, or cost-plus-incentive-fee contract types (10 U.S.C. 3323). This applies notwithstanding a declaration of war or the declaration by the President of a national emergency under section 201 of the National Emergencies Act (50 U.S.C. 1621) that includes the use of the Armed Forces.</P>
                            <CITA>[87 FR 65513, Oct. 28, 2022, as amended at 87 FR 76992, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>216.306</SECTNO>
                            <SUBJECT>Cost-plus-fixed-fee contracts.</SUBJECT>
                            <P>
                                (c) 
                                <E T="03">Limitations.</E>
                                 For contracts in connection with a military construction project or military family housing project, see the prohibition at 216.301-3.
                            </P>
                            <P>(i) Except as provided in paragraph (c)(ii) of this section, annual military construction appropriations acts prohibit the use of cost-plus-fixed-fee contracts that—</P>
                            <P>(A) Are funded by a military construction appropriations act;</P>
                            <P>(B) Are estimated to exceed $25,000; and</P>
                            <P>(C) Will be performed within the United States, except Alaska.</P>
                            <P>(ii) The prohibition in paragraph (c)(i) of this section does not apply to contracts specifically approved in writing, setting forth the reasons therefor, in accordance with the following:</P>
                            <P>(A) The Secretaries of the military departments are authorized to approve such contracts that are for environmental work only, provided the environmental work is not classified as construction, as defined by 10 U.S.C. 2801.</P>
                            <P>(B) The Secretary of Defense or designee must approve such contracts that are not for environmental work only or are for environmental work classified as construction.</P>
                            <CITA>[62 FR 1058, Jan. 8, 1997; 62 FR 1817, Jan. 13, 1997; 62 FR 49305, Sept. 19, 1997; 71 FR 39007, July 11, 2006; 81 FR 65564, Sept. 23, 2016]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>216.307</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>(a) As required by section 827 of the National Defense Authorization Act for Fiscal Year 2013 (Pub. L. 112-239), use the clause at 252.216-7009, Allowability of Costs Incurred in Connection With a Whistleblower Proceeding—</P>
                            <P>(1) In task orders entered pursuant to contracts awarded before September 30, 2013, that include the clause at FAR 52.216-7, Allowable Cost and Payment; and</P>
                            <P>(2) In contracts awarded before September 30, 2013, that—</P>
                            <P>(i) Include the clause at FAR 52.216-7, Allowable Cost and Payment; and</P>
                            <P>(ii) Are modified to include the clause at DFARS 252.203-7002, Requirement to Inform Employees of Whistleblower Rights, dated September 2013 or later.</P>
                            <CITA>[78 FR 59861, Sept. 30, 2013]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 216.4—Incentive Contracts</HD>
                        <SECTION>
                            <SECTNO>216.401</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>(c) See PGI 216.401(c) for information on the Defense Acquisition University Award and Incentive Fees Community of Practice.</P>
                            <P>(d) The determination and findings justifying that the use of an incentive- or award-fee contract is in the best interest of the Government, may be signed by the head of contracting activity or a designee—</P>
                            <P>
                                (i) No lower than one level below the head of the contracting activity for award-fee contracts; or
                                <PRTPAGE P="135"/>
                            </P>
                            <P>(ii) One level above the contracting officer for incentive-fee contracts.</P>
                            <P>(e) Award-fee plans required in FAR 16.401(e) shall be incorporated into all award-fee type contracts. Follow the procedures at PGI 216.401(e) when planning to award an award-fee contract.</P>
                            <CITA>[75 FR 78619, Dec. 16, 2010, as amended at 76 FR 8305, Feb. 14, 2011, 84 FR 65307, Nov. 27, 2019; 87 FR 65513, Oct. 28, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>216.401-71</SECTNO>
                            <SUBJECT>Objective criteria.</SUBJECT>
                            <P>(1) Contracting officers shall use objective criteria to the maximum extent possible to measure contract performance. Objective criteria are associated with cost-plus-incentive-fee and fixed-price-incentive contracts.</P>
                            <P>(2) When objective criteria exist but the contracting officer determines that it is in the best interest of the Government also to incentivize subjective elements of performance, the most appropriate contract type is a multiple-incentive contract containing both objective incentives and subjective award-fee criteria (i.e., cost-plus-incentive-fee/award-fee or fixed-price-incentive/award-fee).</P>
                            <P>(3) See PGI 216.401(e) for guidance on the use of award-fee contracts.</P>
                            <CITA>[76 FR 8305, Feb. 14, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>216.402</SECTNO>
                            <SUBJECT>Application of predetermined, formula-type incentives.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>216.402-2</SECTNO>
                            <SUBJECT>Performance incentives.</SUBJECT>
                            <P>(1) See PGI 216.402-2 for guidance on establishing performance incentives.</P>
                            <P>(2) Contracting officers shall ensure requirements about the payment of incentive fees or the imposition of penalties are included in the solicitation for a contract for the engineering and manufacturing development or production of a weapon system, including embedded software, if the program manager or comparable requiring activity official exercising program manager responsibilities includes—</P>
                            <P>(i) Provisions for the payment of incentive fees to the contractor, based on achievement of design specification requirements for reliability and maintainability of weapons systems under the contract; or</P>
                            <P>(ii) The imposition of penalties to be paid by the contractor to the Government for failure to achieve such design specification requirements (10 U.S.C. 4328).</P>
                            <CITA>[71 FR 39007, July 11, 2006, as amended at 84 FR 58333, Oct. 31, 2019; 87 FR 15818, Mar. 18, 2022; 87 FR 76992, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>216.403</SECTNO>
                            <SUBJECT>Fixed-price incentive contracts.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>216.403-1</SECTNO>
                            <SUBJECT>Fixed-price incentive (firm target) contracts.</SUBJECT>
                            <P>
                                (b) 
                                <E T="03">Application.</E>
                            </P>
                            <P>(1) The contracting officer shall give particular consideration to the use of fixed-price incentive (firm target) contracts, especially for acquisitions moving from development to production.</P>
                            <P>(2) The contracting officer shall pay particular attention to share lines and ceiling prices for fixed-price incentive (firm target) contracts, with a 120 percent ceiling and a 50/50 share ratio as the point of departure for establishing the incentive arrangement.</P>
                            <P>(3) See PGI 216.403-1 for guidance on the use of fixed-price incentive (firm target) contracts.</P>
                            <CITA>[76 FR 57679, Sept. 16, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>216.403-2</SECTNO>
                            <SUBJECT>Fixed-price incentive (successive targets) contracts.</SUBJECT>
                            <P>See PGI 216.403-2 for guidance on the use of fixed-price incentive (successive targets) contracts.</P>
                            <CITA>[71 FR 39007, July 11, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>216.405</SECTNO>
                            <SUBJECT>Cost-reimbursement incentive contracts.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>216.405-1</SECTNO>
                            <SUBJECT>Cost-plus-incentive-fee contracts.</SUBJECT>
                            <P>See PGI 216.405-1 for guidance on the use of cost-plus-incentive-fee contracts.</P>
                            <CITA>[71 FR 39007, July 11, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>216.405-2</SECTNO>
                            <SUBJECT>Cost-plus-award-fee contracts.</SUBJECT>
                            <P>
                                (1) 
                                <E T="03">Award-fee pool.</E>
                                 The award-fee pool is the total available award fee for each evaluation period for the life of the contract. The contracting officer shall perform an analysis of appropriate fee distribution to ensure at least 40 percent of the award fee is available for the final evaluation so that the award fee is appropriately distributed over all evaluation periods to incentivize the 
                                <PRTPAGE P="136"/>
                                contractor throughout performance of the contract. The percentage of award fee available for the final evaluation may be set below 40 percent if the contracting officer determines that a lower percentage is appropriate, and this determination is approved by the head of the contracting activity (HCA). The HCA may not delegate this approval authority.
                            </P>
                            <P>
                                (2) 
                                <E T="03">Award-fee evaluation and payments.</E>
                                 Award-fee payments other than payments resulting from the evaluation at the end of an award-fee period are prohibited. (This prohibition does not apply to base-fee payments.) The fee-determining official's rating for award-fee evaluations will be provided to the contractor within 45 calendar days of the end of the period being evaluated. The final award-fee payment will be consistent with the fee-determining official's final evaluation of the contractor's overall performance against the cost, schedule, and performance outcomes specified in the award-fee plan.
                            </P>
                            <P>
                                (3) 
                                <E T="03">Limitations.</E>
                            </P>
                            <P>(i) The cost-plus-award-fee contract shall not be used—</P>
                            <P>(A) To avoid—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Establishing cost-plus-fixed-fee contracts when the criteria for cost-plus-fixed-fee contracts apply; or
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Developing objective targets so a cost-plus-incentive-fee contract can be used; or
                            </P>
                            <P>(B) For either engineering development or operational system development acquisitions that have specifications suitable for simultaneous research and development and production, except a cost-plus-award-fee contract may be used for individual engineering development or operational system development acquisitions ancillary to the development of a major weapon system or equipment, where—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) It is more advantageous; and
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) The purpose of the acquisition is clearly to determine or solve specific problems associated with the major weapon system or equipment.
                            </P>
                            <P>(ii) Do not apply the weighted guidelines method to cost-plus-award-fee contracts for either the base (fixed) fee or the award fee.</P>
                            <P>(iii) The base fee shall not exceed three percent of the estimated cost of the contract exclusive of the fee.</P>
                            <P>(4) See PGI 216.405-2 for guidance on the use of cost-plus-award-fee contracts.</P>
                            <CITA>[76 FR 8305, Feb. 14, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>216.405-2-70</SECTNO>
                            <SUBJECT>Award fee reduction or denial for jeopardizing the health or safety of Government personnel.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Definitions.</E>
                            </P>
                            <P>
                                <E T="03">Covered incident</E>
                                 and 
                                <E T="03">serious bodily injury</E>
                                <E T="03">,</E>
                                 as used in this section, are defined in the clause at 252.216-7004, Award Fee Reduction or Denial for Jeopardizing the Health or Safety of Government Personnel.
                            </P>
                            <P>(b) The contracting officer shall include in the evaluation criteria of any award-fee plan, a review of contractor and subcontractor actions that jeopardized the health or safety of Government personnel, through gross negligence or reckless disregard for the safety of such personnel, as determined through—</P>
                            <P>(1) Conviction in a criminal proceeding, or finding of fault and liability in a civil or administrative proceeding (in accordance with section 823 of the National Defense Authorization Act for Fiscal Year 2010 (Pub. L. 111-84)); or</P>
                            <P>(2) If a contractor or a subcontractor at any tier is not subject to the jurisdiction of the U.S. courts, a final determination of contractor or subcontractor fault resulting from a DoD investigation (in accordance with section 834 of the National Defense Authorization Act for Fiscal Year 2011 (Pub. L. 111-383)).</P>
                            <P>(c) In evaluating the contractor's performance under a contract that includes the clause at 252.216-7004, Award Fee Reduction or Denial for Jeopardizing the Health or Safety of Government Personnel, the contracting officer shall consider reducing or denying award fees for a period if contractor or subcontractor actions cause serious bodily injury or death of civilian or military Government personnel during such period. The contracting officer's evaluation also shall consider recovering all or part of award fees previously paid for such period.</P>
                            <CITA>[75 FR 69361, Nov. 12, 2010. Redesignated at 76 FR 52135, Aug. 19, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="137"/>
                            <SECTNO>216.405-2-71</SECTNO>
                            <SUBJECT>Award fee reduction or denial for failure to comply with requirements relating to performance of private security functions.</SUBJECT>
                            <P>(a) In accordance with section 862 of the National Defense Authorization Act for Fiscal Year 2008, as amended, the contracting officer shall include in any award-fee plan a requirement to review contractor compliance with, or violation of, applicable requirements of the contract with regard to the performance of private security functions in an area of contingency operations, complex contingency operations, or other military operations or exercises that are designated by the combatant commander (see 225.370).</P>
                            <P>(b) In evaluating the contractor's performance under a contract that includes the clause at 252.225-7039, Defense Contractors Performing Private Security Functions Outside the United States, the contracting officer shall consider reducing or denying award fees for a period if the contractor fails to comply with the requirements of the clause during such period. The contracting officer's evaluation also shall consider recovering all or part of award fees previously paid for such period.</P>
                            <CITA>[76 FR 52135, Aug. 19, 2011, as amended at 78 FR 73450, Dec. 6, 2013; 81 FR 42560, June 30, 2016]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>216.406</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>(e) Use the clause at 252.216-7004, Award Fee Reduction or Denial for Jeopardizing the Health or Safety of Government Personnel, in all solicitations and contracts containing award-fee provisions.</P>
                            <CITA>[76 FR 8305, Feb. 14, 2011, as amended at 83 FR 49181, Sept. 28, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>216.470</SECTNO>
                            <SUBJECT>Other applications of award fees.</SUBJECT>
                            <P>See PGI 216.470 for guidance on other applications of award fees.</P>
                            <CITA>[71 FR 39008, July 11, 2006]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 216.5—Indefinite-Delivery Contracts</HD>
                        <SECTION>
                            <SECTNO>216.501-2-70</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>(a)(i) For items with a shelf-life of less than 6 months, consider the use of indefinite-delivery type contracts with orders to be placed either—</P>
                            <P>(A) Directly by the users; or</P>
                            <P>(B) By central purchasing offices with deliveries direct to users.</P>
                            <P>(ii) Whenever an indefinite-delivery contract is issued, the issuing office must furnish all ordering offices sufficient information for the ordering office to complete its contract reporting responsibilities under 204.670-2. This data must be furnished to the ordering activity in sufficient time for the activity to prepare its report for the action within 3 working days of the order.</P>
                            <P>(b) See 217.204(e)(i) for limitations on the period for task order or delivery order contracts awarded by DoD pursuant to 10 U.S.C. 3403.</P>
                            <CITA>[56 FR 36340, July 31, 1991, as amended at 57 FR 42630, Sept. 15, 1992; 63 FR 11529, Mar. 9, 1998. Redesignated and amended at 78 FR 38235, June 26, 2013; 87 FR 76992, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>216.504</SECTNO>
                            <SUBJECT>Indefinite-quantity contracts.</SUBJECT>
                            <P>
                                (c) 
                                <E T="03">Multiple award preference</E>
                                —(1) 
                                <E T="03">Planning the acquisition.</E>
                                 (ii)(D)(
                                <E T="03">1</E>
                                ) The senior procurement executive has the authority to make the determination authorized in FAR 16.504(c)(1)(ii)(D)(
                                <E T="03">1</E>
                                ).
                            </P>
                            <P>
                                (
                                <E T="03">i</E>
                                ) In accordance with 10 U.S.C. 3403(d)(3), when making the determination at FAR 16.504(c)(1)(ii)(D)(
                                <E T="03">1</E>
                                )(
                                <E T="03">i</E>
                                ), the senior procurement executive shall determine that the task or delivery orders expected under the contract are so integrally related that only a single source can “efficiently perform the work,” instead of “reasonably perform the work” as required by the FAR.
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) The congressional notification requirement at FAR 16.504(c)(1)(ii)(D)(
                                <E T="03">2</E>
                                ) does not apply to DoD.
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                )(
                                <E T="03">i</E>
                                ) In accordance with 10 U.S.C. 3403(d)(3), the determination at FAR 16.504(c)(1)(ii)(D) is not required if a justification has been executed, in accordance with FAR subpart 6.3 and subpart 206.3.
                            </P>
                            <CITA>[84 FR 12139, Apr. 1, 2019, as amended at 85 FR 60922, Sept. 29, 2020; 87 FR 76992, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>216.505</SECTNO>
                            <SUBJECT>Ordering.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">General.</E>
                            </P>
                            <P>
                                (6) Orders placed under indefinite-delivery contracts may be issued on DD 
                                <PRTPAGE P="138"/>
                                Form 1155, Order for Supplies or Services.
                            </P>
                            <P>(S-70) Departments and agencies shall comply with the review, approval, and reporting requirements established in accordance with subpart 217.7 when placing orders under non-DoD contracts in amounts exceeding the simplified acquisition threshold.</P>
                            <P>(S-71) See 204.7603 for procedures on the required use of the Supplier Performance Risk System (SPRS) risk assessments.</P>
                            <P>(i) The contracting officer shall ensure SPRS assessments of price risk and supplier risk are considered as a part of the award decision.</P>
                            <P>(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.</P>
                            <P>(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.</P>
                            <P>
                                (b) 
                                <E T="03">Orders under multiple-award contracts.</E>
                            </P>
                            <P>
                                (1) 
                                <E T="03">Fair opportunity.</E>
                            </P>
                            <P>(A) See 215.101-2-70 for the limitations and prohibitions on the use of the lowest price technically acceptable source selection process, which are applicable to orders placed against multiple award indefinite delivery contracts.</P>
                            <P>(B) See 217.7801 for the prohibition on the use of reverse auctions for personal protective equipment and aviation critical safety items.</P>
                            <P>
                                (b)(2) 
                                <E T="03">Exceptions to the fair opportunity process.</E>
                                 For an order exceeding the simplified acquisition threshold, that is a follow-on to an order previously issued for the same supply or service based on a justification for an exception to fair opportunity citing the authority at FAR 16.505(b)(2)(i)(B) or (C), follow the procedures at PGI 216.505(b)(2).
                            </P>
                            <P>
                                (6) 
                                <E T="03">Postaward notices and debriefing of awardees for orders exceeding $6 million.</E>
                                 In addition to the notice required at FAR 16.505(b)(6), a written or oral postaward debriefing of successful and unsuccessful awardees is required for task orders and delivery orders valued at $10 million or more (section 818 of the National Defense Authorization Act for Fiscal Year 2018 (Pub. L. 115-91)).
                            </P>
                            <P>(ii) Follow the procedures at 215.506 and 215.506-70 when providing the postaward debriefing to successful and unsuccessful awardees for task orders or delivery orders valued at $10 million or more.</P>
                            <CITA>[63 FR 11529, Mar. 9, 1998, as amended at 70 FR 29642, May 24, 2005; 71 FR 14103, Mar. 21, 2006; 80 FR 21657, Apr. 20, 2015; 80 FR 67255, Oct. 30, 2015; 84 FR 50789, Sept. 26, 2019; 87 FR 15810, Mar. 18, 2022; 88 FR 17339, Mar. 22, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>216.505-70</SECTNO>
                            <SUBJECT>Orders under multiple-award contracts.</SUBJECT>
                            <P>(a) If only one offer is received in response to an order exceeding the simplified acquisition threshold that is placed on a competitive basis, the contracting officer shall follow the procedures at 215.371.</P>
                            <P>(b) See PGI 216.505-70 for guidance regarding minimum labor category qualifications for orders issued under multiple-award services contracts.</P>
                            <CITA>[78 FR 38235, June 26, 2013, as amended at 84 FR 48510, Sept. 13, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>216.506</SECTNO>
                            <SUBJECT>Solicitation provisions and contract clauses.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>216.506-70</SECTNO>
                            <SUBJECT>Additional solicitation provisions and contract clause.</SUBJECT>
                            <P>(a) Use the provisions at 252.215-7007, Notice of Intent to Resolicit, and 252.215-7008, Only One Offer, as prescribed at 215.371-6 and 215.408(3), respectively.</P>
                            <P>(b) Use the clause at 252.216-7010, Postaward Debriefings for Task Orders and Delivery Orders, in competitive negotiated solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, when a multiple-award contract is contemplated and task orders or delivery orders placed under the contract may be valued at $10 million or more.</P>
                            <CITA>[87 FR 15810, Mar. 18, 2022, as amended at 88 FR 6583, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <PRTPAGE P="139"/>
                        <HD SOURCE="HED">Subpart 216.6—Time-And-Materials, Labor-Hour, and Letter Contracts</HD>
                        <SECTION>
                            <SECTNO>216.601</SECTNO>
                            <SUBJECT>Time-and-materials contracts.</SUBJECT>
                            <P>
                                (d) 
                                <E T="03">Limitations.</E>
                                 (i)(A) 
                                <E T="03">Approval of determination and findings for time-and-materials or labor-hour contracts.</E>
                            </P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) 
                                <E T="03">Base period plus any option periods is three years or less.</E>
                            </P>
                            <P>
                                (
                                <E T="03">i</E>
                                ) For contracts (including indefinite-delivery contracts) and orders in which the portion of the requirement performed on a time-and-materials or labor-hour basis exceeds $1 million, the approval authority for the determination and findings shall be the senior contracting official within the contracting activity. This authority may not be delegated.
                            </P>
                            <P>
                                (
                                <E T="03">ii</E>
                                ) For contracts (including indefinite-delivery contracts) and orders in which the portion of the requirement performed on a time-and-materials or labor-hour basis is less than or equal to $1 million, the determination and findings shall be approved one level above the contracting officer.
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) 
                                <E T="03">Base period plus any option periods exceeds three years.</E>
                                 The authority of the head of the contracting activity to approve the determination and findings may not be delegated.
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) 
                                <E T="03">Exception.</E>
                                 The approval requirements in paragraphs (d)(i)(A)(
                                <E T="03">1</E>
                                ) and (
                                <E T="03">2</E>
                                ) of this section do not apply to contracts that, as determined by the head of the contracting activity—
                            </P>
                            <P>
                                (
                                <E T="03">i</E>
                                ) Support contingency or humanitarian or peacekeeping operations;
                            </P>
                            <P>
                                (
                                <E T="03">ii</E>
                                ) Facilitate defense against or recovery from conventional, cyber, nuclear, biological, chemical or radiological attack;
                            </P>
                            <P>
                                (
                                <E T="03">iii</E>
                                ) Facilitate the provision of international disaster assistance; or
                            </P>
                            <P>
                                (
                                <E T="03">iv</E>
                                ) Support response to an emergency or major disaster.
                            </P>
                            <P>
                                (B) 
                                <E T="03">Content of determination and findings.</E>
                                 The determination and findings shall contain sufficient facts and rationale to justify that no other contract type is suitable. At a minimum, the determination and findings shall—
                            </P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Include a description of the market research conducted;
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Establish that it is not possible at the time of placing the contract or order to accurately estimate the extent or duration of the work or to anticipate costs with any reasonable degree of certainty;
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) Address why a cost-plus-fixed-fee term or other cost-reimbursement, incentive, or fixed-price contract or order is not appropriate; for contracts (including indefinite-delivery contracts) and orders for other than commercial products or commercial services awarded to contractors with adequate accounting systems, a cost-plus-fixed-fee term contract type shall be preferred over a time-and-materials or labor-hour contract type;
                            </P>
                            <P>
                                (
                                <E T="03">4</E>
                                ) Establish that the requirement has been structured to minimize the use of time-and-materials and labor-hour requirements (
                                <E T="03">e.g.,</E>
                                 limiting the value or length of the time-and-materials or labor-hour portion of the contract or order; establishing fixed prices for portions of the requirement); and
                            </P>
                            <P>
                                (
                                <E T="03">5</E>
                                ) Describe the actions planned to minimize the use of time-and-materials and labor-hour contracts on future acquisitions for the same requirements.
                            </P>
                            <P>
                                (C) 
                                <E T="03">Indefinite-delivery contracts.</E>
                                 For indefinite-delivery contracts, the contracting officer shall structure contracts that authorize time-and-materials orders or labor-hour orders to also authorize orders on a cost-reimbursement, incentive, or fixed-price basis, to the maximum extent practicable.
                            </P>
                            <P>
                                (e) 
                                <E T="03">Solicitation provisions.</E>
                                 Use the provision at FAR 52.216-29, Time-and-Materials/Labor-Hour Proposal Requirements—Other Than Commercial Acquisition with Adequate Price Competition, with 252.216-7002, Alternate A, in solicitations contemplating the use of a time-and-materials or labor-hour contract type for other than commercial products or commercial services if the price is expected to be based on adequate competition.
                            </P>
                            <CITA>[71 FR 74471, Dec. 12, 2006, as amended at 73 FR 70912, Nov. 24, 2008; 80 FR 29980, May 26, 2015; 83 FR 24890, May 30, 2018; 88 FR 6583, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>216.603</SECTNO>
                            <SUBJECT>Letter contracts.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>216.603-2</SECTNO>
                            <SUBJECT>Application.</SUBJECT>
                            <P>
                                (c)(3) In accordance with 10 U.S.C. 3372, establish definitization schedules 
                                <PRTPAGE P="140"/>
                                for letter contracts following the requirements at 217.7404-3(a) instead of the requirements at FAR 16.603-2(c)(3).
                            </P>
                            <CITA>[75 FR 32642, June 8, 2010, as amended at 87 FR 76992, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>216.603-3</SECTNO>
                            <SUBJECT>Limitations.</SUBJECT>
                            <P>See subpart 217.74 for additional limitations on the use of letter contracts.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>216.603-4</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>(b)(2) See 217.7405(a) for additional guidance regarding use of the clause at FAR 52.216-24, Limitation of Government Liability.</P>
                            <P>(3) Use the clause at 252.217-7027, Contract Definitization, in accordance with its prescription at 217.7406(b), instead of the clause at FAR 52.216-25, Contract Definitization.</P>
                            <CITA>[61 FR 7743, Feb. 29, 1996, as amended at 71 FR 58537, Oct. 4, 2006; 72 FR 69159, Dec. 7, 2007; 76 FR 76319, Dec. 7, 2011]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 216.7—Agreements</HD>
                        <SECTION>
                            <SECTNO>216.703</SECTNO>
                            <SUBJECT>Basic ordering agreements.</SUBJECT>
                            <P>
                                (c) 
                                <E T="03">Limitations.</E>
                                 The period during which orders may be placed against a basic ordering agreement may not exceed 5 years.
                            </P>
                            <P>
                                (d) 
                                <E T="03">Orders.</E>
                                 Follow the procedures at PGI 216.703(d) for issuing orders under basic ordering agreements.
                            </P>
                            <CITA>[71 FR 39008, July 11, 2006]</CITA>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 217</EAR>
                    <HD SOURCE="HED">PART 217—SPECIAL CONTRACTING METHODS</HD>
                    <CONTENTS>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 217.1—Multiyear Contracting</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>217.103</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>217.170</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>217.171</SECTNO>
                            <SUBJECT>Multiyear contracts for services.</SUBJECT>
                            <SECTNO>217.172</SECTNO>
                            <SUBJECT>Multiyear contracts for supplies.</SUBJECT>
                            <SECTNO>217.173</SECTNO>
                            <SUBJECT>Multiyear contracts for military family housing.</SUBJECT>
                            <SECTNO>217.174</SECTNO>
                            <SUBJECT>Multiyear contracts for electricity from renewable energy sources.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 217.2—Options</HD>
                            <SECTNO>217.202</SECTNO>
                            <SUBJECT>Use of options.</SUBJECT>
                            <SECTNO>217.204</SECTNO>
                            <SUBJECT>Contracts.</SUBJECT>
                            <SECTNO>217.207</SECTNO>
                            <SUBJECT>Exercise of options.</SUBJECT>
                            <SECTNO>217.208</SECTNO>
                            <SUBJECT>Solicitation provisions and contract clauses.</SUBJECT>
                            <SECTNO>217.208-70</SECTNO>
                            <SUBJECT>Additional clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 217.5—Interagency Acquisitions</HD>
                            <SECTNO>217.500</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>217.502</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>217.502-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>217.503</SECTNO>
                            <SUBJECT>Ordering procedures.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 217.6—Management and Operating Contracts</HD>
                            <SECTNO>217.600</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 217.7—Interagency Acquisitions: Acquisitions by Nondefense Agencies on Behalf of the Department of Defense</HD>
                            <SECTNO>217.700</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>217.701</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>217.770</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 217.70—Exchange of Personal Property</HD>
                            <SECTNO>217.7000</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>217.7001</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>217.7002</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>217.7003</SECTNO>
                            <SUBJECT>Purchase request.</SUBJECT>
                            <SECTNO>217.7004</SECTNO>
                            <SUBJECT>Solicitation and award.</SUBJECT>
                            <SECTNO>217.7005</SECTNO>
                            <SUBJECT>Solicitation provision.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 217.71—Master Agreement for Repair and Alteration of Vessels</HD>
                            <SECTNO>217.7100</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>217.7101</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>217.7102</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>217.7103</SECTNO>
                            <SUBJECT>Master agreements and job orders.</SUBJECT>
                            <SECTNO>217.7103-1</SECTNO>
                            <SUBJECT>Content and format of master agreements.</SUBJECT>
                            <SECTNO>217.7103-2</SECTNO>
                            <SUBJECT>Period of agreement.</SUBJECT>
                            <SECTNO>217.7103-3</SECTNO>
                            <SUBJECT>Solicitations for job orders.</SUBJECT>
                            <SECTNO>217.7103-4</SECTNO>
                            <SUBJECT>Emergency work.</SUBJECT>
                            <SECTNO>217.7103-5</SECTNO>
                            <SUBJECT>Repair costs not readily ascertainable.</SUBJECT>
                            <SECTNO>217.7103-6</SECTNO>
                            <SUBJECT>Modification of master agreements.</SUBJECT>
                            <SECTNO>217.7104</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <RESERVED>Subpart 217.72 [Reserved]</RESERVED>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 217.73—Identification of Sources of Supply</HD>
                            <SECTNO>217.7300</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>217.7301</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>217.7302</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>217.7303</SECTNO>
                            <SUBJECT>Solicitation provision.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 217.74—Undefinitized Contract Actions</HD>
                            <SECTNO>217.7400</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>217.7401</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>217.7402</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <SECTNO>217.7403</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>217.7404</SECTNO>
                            <SUBJECT>Limitations.</SUBJECT>
                            <SECTNO>217.7404-1</SECTNO>
                            <SUBJECT>Authorization.</SUBJECT>
                            <SECTNO>217.7404-2</SECTNO>
                            <SUBJECT>
                                Price ceiling.
                                <PRTPAGE P="141"/>
                            </SUBJECT>
                            <SECTNO>217.7404-3</SECTNO>
                            <SUBJECT>Definitization schedule.</SUBJECT>
                            <SECTNO>217.7404-4</SECTNO>
                            <SUBJECT>Limitations on obligations.</SUBJECT>
                            <SECTNO>217.7404-5</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <SECTNO>217.7404-6</SECTNO>
                            <SUBJECT>Allowable profit.</SUBJECT>
                            <SECTNO>217.7405</SECTNO>
                            <SUBJECT>Plans and reports.</SUBJECT>
                            <SECTNO>217.7406</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 217.75—Acquisition of Replenishment Parts</HD>
                            <SECTNO>217.7500</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>217.7501</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <SECTNO>217.7502</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>217.7503</SECTNO>
                            <SUBJECT>Spares acquisition integrated with production.</SUBJECT>
                            <SECTNO>217.7504</SECTNO>
                            <SUBJECT>Acquisition of parts when data is not available.</SUBJECT>
                            <SECTNO>217.7505</SECTNO>
                            <SUBJECT>Limitations on price increases.</SUBJECT>
                            <SECTNO>217.7506</SECTNO>
                            <SUBJECT>Spare parts breakout program.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 217.76—Contracts with Provisioning Requirements</HD>
                            <SECTNO>217.7601</SECTNO>
                            <SUBJECT>Provisioning.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 217.77—Over and Above Work</HD>
                            <SECTNO>217.7701</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>217.7702</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 217.78—Reverse Auctions</HD>
                            <SECTNO>217.7801</SECTNO>
                            <SUBJECT>Prohibition.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36345, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 217.1—Multiyear Contracting</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>63 FR 11529, Mar. 9, 1998, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>217.103</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this subpart—</P>
                            <P>
                                <E T="03">Advance procurement</E>
                                 means an exception to the full funding policy that allows acquisition of long lead time items (advance long lead acquisition) or economic order quantities (EOQ) of items (advance EOQ acquisition) in a fiscal year in advance of that in which the related end item is to be acquired. Advance procurements may include materials, parts, components, and effort that must be funded in advance to maintain a planned production schedule.
                            </P>
                            <P>
                                <E T="03">Congressional defense committees</E>
                                 means—
                            </P>
                            <P>(1) The Committee on Armed Services of the Senate;</P>
                            <P>(2) The Committee on Appropriations of the Senate;</P>
                            <P>(3) The Subcommittee on Defense of the Committee on Appropriations of the Senate;</P>
                            <P>(4) The Committee on Armed Services of the House of Representatives;</P>
                            <P>(5) The Committee on Appropriations of the House of Representatives; and</P>
                            <P>(6) The Subcommittee on Defense of the Committee on Appropriations of the House of Representatives.</P>
                            <P>
                                <E T="03">Military installation</E>
                                 means a base, camp, post, station, yard, center, or other activity under the jurisdiction of the Secretary of a military department or, in the case of an activity in a foreign country, under the operational control of the Secretary of a military department or the Secretary of Defense (10 U.S.C. 2801(c)(4)).
                            </P>
                            <CITA>[68 FR 43332, July 22, 2003, as amended at 79 FR 35700, June 24, 2014; 80 FR 29982, May 26, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.170</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>(a) Before awarding a multiyear contract, the head of the agency must compare the cost of that contract to the cost of an annual procurement approach, using a present value analysis. Do not award the multiyear contract unless the analysis shows that the multiyear contract will result in the lower cost (10 U.S.C. 3501(l)(7); section 8008(a) of Pub. L. 105-56 and similar sections in subsequent DoD appropriations acts).</P>
                            <P>(b) The head of the agency must provide written notice to the congressional defense committees at least 30 days before termination of any multiyear contract (section 8010 of Division C, Title VIII, of the Consolidated and Further Continuing Appropriations Act, 2015 (Pub. L. 113-235) and similar sections in subsequent DoD appropriations acts).</P>
                            <P>(c) Every multiyear contract must comply with FAR 17.104(c), unless an exception is approved through the budget process in coordination with the cognizant comptroller.</P>
                            <P>
                                (d)(1) DoD must provide notification to the congressional defense committees at least 30 days before entering into a multiyear contract for certain procurements, including those expected to—
                                <PRTPAGE P="142"/>
                            </P>
                            <P>(i) Employ an unfunded contingent liability in excess of $20 million (see 10 U.S.C. 3501(l)(1), 10 U.S.C. 3531(d)(1), and section 8008(a) of Pub. L. 105-56 and similar sections in subsequent DoD appropriations acts);</P>
                            <P>(ii) Employ economic order quantity procurement in excess of $20 million in any one year of the contract (see 10 U.S.C. 3501(l)(1) and section 8008(a) of Pub. L. 105-56 and similar sections in subsequent DoD appropriations acts);</P>
                            <P>(iii) Involve a contract for advance procurement leading to a multiyear contract that employs economic order quantity procurement in excess of $20 million in any one year (see  10 U.S.C. 3501(l)(1) and section 8008(a) of Pub. L. 105-56 and similar sections in subsequent DoD appropriations acts); or</P>
                            <P>(iv) Include a cancellation ceiling in excess of $150 million (see 10 U.S.C. 3531(d)(4) and  10 U.S.C. 3501(g)(1)).</P>
                            <P>(2) A DoD component must submit a request for authority to enter into a multiyear contract described in paragraphs (d)(1)(i) through (iv) of this section as part of the component's budget submission for the fiscal year in which the multiyear contract will be initiated. DoD will include the request, for each candidate it supports, as part of the President's budget for that year and in the Appendix to that budget as part of proposed legislative language for the appropriations bill for that year (section 8008(b) of Pub. L. 105-56).</P>
                            <P>(3) If the advisability of using a multiyear contract becomes apparent too late to satisfy the requirements in paragraph (d)(2) of this section, the request for authority to enter into a multiyear contract must be—</P>
                            <P>(i) Formally submitted by the President as a budget amendment; or</P>
                            <P>(ii) Made by the Secretary of Defense, in writing, to the congressional defense committees (see section 8008(b) of Pub. L. 105-56).</P>
                            <P>(4) Agencies must establish reporting procedures to meet the congressional notification requirements of paragraph (d)(1) of this section. The head of the agency must submit a copy of each notice to the Principal Director, Defense Pricing, Contracting, and Acquisition Policy (DPCAP), Office of the Under Secretary of Defense (Acquisition and Sustainment) (OUSD(A&amp;S)), and to the Deputy Under Secretary of Defense (Comptroller) (Program/Budget) (OUSD(C)(P/B)).</P>
                            <P>(5) If the budget for a contract that contains a cancellation ceiling in excess of $150 million does not include proposed funding for the costs of contract cancellation up to the cancellation ceiling established in the contract—</P>
                            <P>(i) The notification required by paragraph (d)(1) of this section shall include—</P>
                            <P>(A) The cancellation ceiling amounts planned for each program year in the proposed multiyear contract, together with the reasons for the amounts planned;</P>
                            <P>(B) The extent to which costs of contract cancellation are not included in the budget for the contract; and</P>
                            <P>(C) A financial risk assessment of not including budgeting for costs of contract cancellation (10 U.S.C. 3501(g) and 10 U.S.C. 3531(d)); and</P>
                            <P>(ii) The head of the agency shall provide copies of the notification to the Office of Management and Budget at least 14 days before contract award.</P>
                            <CITA>[66 FR 63337, Dec. 6, 2001, as amended at 68 FR 7439, Feb. 14, 2003; 70 FR 24324, May 9, 2005; 71 FR 75892, Dec. 19, 2006; 75 FR 9115, Mar. 1, 2010; 75 FR 54526, Sept. 8, 2010; 75 FR 45073, Aug. 2, 2010; 76 FR 58152, Sept. 20, 2011; 80 FR 29982, May 26, 2015; 80 FR 36904, June 26, 2015; 81 FR 28731, May 10, 2016; 85 FR 61504, Sept. 29, 2020; 87 FR 76992, Dec. 16, 2022; 89 FR 60831, July 29, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.171</SECTNO>
                            <SUBJECT>Multiyear contracts for services.</SUBJECT>
                            <P>(a) The head of the agency may enter into a multiyear contract for a period of not more than 5 years for the following types of services (and items of supply relating to such services), even though funds are limited by statute to obligation only during the fiscal year for which they were appropriated (10 U.S.C. 3531(a)). Covered services are—</P>
                            <P>(1) Operation, maintenance, and support of facilities and installations;</P>
                            <P>(2) Maintenance or modification of aircraft, ships, vehicles, and other highly complex military equipment;</P>
                            <P>
                                (3) Specialized training requiring high-quality instructor skills (
                                <E T="03">e.g.,</E>
                                 training for pilots and aircrew members or foreign language training);
                                <PRTPAGE P="143"/>
                            </P>
                            <P>
                                (4) Base services (
                                <E T="03">e.g.,</E>
                                 ground maintenance, in-plane refueling, bus transportation, and refuse collection and disposal); and
                            </P>
                            <P>(5) Environmental remediation services for—</P>
                            <P>(i) An active military installation;</P>
                            <P>(ii) A military installation being closed or realigned under a base closure law as defined in 10 U.S.C. 2667(h)(2); or</P>
                            <P>(iii) A site formerly used by DoD (10 U.S.C. 3531(b)).</P>
                            <P>(b) The head of the agency must be guided by the following principles when entering into a multiyear contract for services:</P>
                            <P>(1) The portion of the cost of any plant or equipment amortized as a cost of contract performance should not exceed the ratio between the period of contract performance and the anticipated useful commercial life of the plant or equipment. As used in this section, “useful commercial life” means the commercial utility of the facilities rather than the physical life, with due consideration given to such factors as the location, specialized nature, and obsolescence of the facilities.</P>
                            <P>(2) Consider the desirability of obtaining an option to extend the term of the contract for a reasonable period not to exceed 3 years at prices that do not include charges for plant, equipment, or other nonrecurring costs already amortized.</P>
                            <P>(3) Consider the desirability of reserving the right to take title, under the appropriate circumstances, to the plant or equipment upon payment of the unamortized portion of the cost (10 U.S.C. 3531(c)).</P>
                            <P>(c) Before entering into a multiyear contract for services, the head of the agency must make a written determination that—</P>
                            <P>(1) There will be a continuing requirement for the services consistent with current plans for the proposed contract period;</P>
                            <P>(2) Furnishing the services will require—</P>
                            <P>(i) A substantial initial investment in plant or equipment; or</P>
                            <P>(ii) The incurrence of substantial contingent liabilities for the assembly, training, or transportation of a specialized work force; and</P>
                            <P>(3) Using a multiyear contract will promote the best interests of the United States by encouraging effective competition and promoting economies in operations (10 U.S.C. 3531(a)).</P>
                            <P>(d) The head of an agency may not initiate a multiyear contract for services if the value of the multiyear contract exceeds $750 million unless a law specifically provides authority for the contract (10 U.S.C. 3531(d)(2)).</P>
                            <CITA>[66 FR 63337, Dec. 6, 2001, as amended at 68 FR 43333, July 22, 2003; 70 FR 24324, May 9, 2005; 71 FR 75892, Dec. 19, 2006; 75 FR 45073, Aug. 2, 2010; 76 FR 58153, Sept. 20, 2011; 76 FR 76319, Dec. 7, 2011; 80 FR 29982, May 26, 2015; 80 FR 36904, June 26, 2015; 85 FR 61504, Sept. 29, 2020; 87 FR 76992, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.172</SECTNO>
                            <SUBJECT>Multiyear contracts for supplies.</SUBJECT>
                            <P>(a) This section applies to all multiyear contracts for supplies, including weapon systems and other multiyear acquisitions specifically authorized by law (10 U.S.C. 3501).</P>
                            <P>(b) The head of the agency may enter into a multiyear contract for supplies if, in addition to the conditions listed in FAR 17.105-1(b), the use of such a contract will promote the national security of the United States (10 U.S.C. 3501(a)(6)).</P>
                            <P>(c) Multiyear contracts in amounts exceeding $750 million must be specifically authorized by law in an act other than an appropriations act (10 U.S.C. 3501(i)(1)).</P>
                            <P>(d) The head of the agency may not initiate a multiyear procurement contract for any system (or component thereof) if the value of the multiyear contract would exceed $750 million unless authority for the contract is specifically provided in an appropriations act (10 U.S.C. 3501(l)(3)).</P>
                            <P>(e) The head of the agency shall not enter into a multiyear contract unless—</P>
                            <P>
                                (1) The Secretary of Defense has submitted to Congress a budget request for full funding of units to be procured through the contract;
                                <PRTPAGE P="144"/>
                            </P>
                            <P>(2) In the case of a contract for procurement of aircraft, the budget request includes full funding of procurement funds for production beyond advance procurement activities of aircraft units to be produced in the fiscal year covered by the budget;</P>
                            <P>(3) Cancellation provisions in the contract do not include consideration of recurring manufacturing costs of the contractor associated with the production of unfunded units to be delivered under the contract;</P>
                            <P>(4) The contract provides that payments to the contractor under the contract shall not be made in advance of incurred costs on funded units; and</P>
                            <P>(5) The contract does not provide for a price adjustment based on a failure to award a follow-on contract (section 8010 of Division C, Title VIII, of the Consolidated and Further Continuing Appropriations Act, 2015 (Pub. L. 113-235) and similar sections in subsequent DoD appropriations acts).</P>
                            <P>(f)(1) The head of the agency must not enter into or extend a multiyear contract that exceeds $750 million (when entered into or extended) until the Secretary of Defense identifies the contract and any extension in a report submitted to the congressional defense committees (10 U.S.C. 3501(l)(5)).</P>
                            <P>(2) In addition, for contracts equal to or greater than $750 million, the head of the contracting activity must determine that the conditions required by paragraph (h)(2)(i) through (vii) of this section will be met by such contract, in accordance with the Secretary's certification and determination required by paragraph (h)(2) of this section .</P>
                            <P>(g) The head of the agency may enter into a multiyear contract for—</P>
                            <P>(1) A weapon system and associated items, services, and logistics support for a weapon system (10 U.S.C. 3501(h)(1)); and</P>
                            <P>
                                (2) Advance procurement of components, parts, and materials necessary to manufacture a weapon system, including advance procurement to achieve economic lot purchases or more efficient production rates (see paragraphs (h)(3) and (4) of this section regarding economic order quantity procurements) (10 U.S.C. 3501(h)(2)). Before initiating an advance procurement, the contracting officer must verify that it is consistent with DoD policy (
                                <E T="03">e.g.,</E>
                                 the full funding policy in Volume 2A, chapter 1, of DoD 7000.14-R, Financial Management Regulation).
                            </P>
                            <P>(h) The head of the agency shall ensure that the following conditions are satisfied before awarding a multiyear contract for a defense acquisition program that has been specifically authorized by law to be carried out using multiyear contract authority:</P>
                            <P>(1) The multiyear exhibits required by DoD 7000.14-R, Financial Management Regulation, are included in the agency's budget estimate submission and the President's budget request.</P>
                            <P>(2) The Secretary of Defense certifies to Congress in writing, by no later than 30 days before entry into such contracts, that each of the conditions in paragraphs (h)(2)(i) through (vii) of this section is satisfied (10 U.S.C. 3501(i)(3)).</P>
                            <P>(i) The Secretary has determined that each of the requirements in FAR 17.105-1, paragraphs (b)(1) through (5), will be met by such contract and has provided the basis for such determination to the congressional defense committees (10 U.S.C. 3501(i)(3)(A)).</P>
                            <P>(ii) The Secretary's determination under paragraph (h)(2)(i) of this section was made after the completion of a cost analysis performed by the Defense Cost and Resource Center of the Department of Defense and such analysis supports the findings (10 U.S.C. 3501(i)(3)(B)).</P>
                            <P>(iii) The system being acquired pursuant to such contract has not been determined to have experienced cost growth in excess of the critical cost growth threshold pursuant to 10 U.S.C. 4371(a)(3) within 5 years prior to the date the Secretary anticipates such contract (or a contract for advance procurement entered into consistent with the authorization for such contract) will be awarded (10 U.S.C. 3501(i)(3)(C)).</P>
                            <P>
                                (iv) A sufficient number of end items of the system being acquired under such contract have been delivered at or within the most current estimates of the program acquisition unit cost or procurement unit cost for such system to determine that current estimates of such unit costs are realistic (10 U.S.C. 3501(i)(3)(D)).
                                <PRTPAGE P="145"/>
                            </P>
                            <P>(v) Sufficient funds will be available in the fiscal year in which the contract is to be awarded to perform the contract, and the future-years defense program for such fiscal year will include the funding required to execute the program without cancellation (10 U.S.C. 3501(i)(3)(E)).</P>
                            <P>(vi) The contract is a fixed price type contract (10 U.S.C. 3501(i)(3)(F)).</P>
                            <P>(vii) The proposed multiyear contract provides for production at not less than minimum economic rates, given the existing tooling and facilities (10 U.S.C. 3501(i)(3)(G)). The head of the agency shall submit to OUSD(C)(P/B) information supporting the agency's determination that this requirement has been met.</P>
                            <P>(viii) The head of the agency shall submit information supporting this certification to OUSD(C)(P/B)&amp; for transmission to Congress through the Secretary of Defense.</P>
                            <P>(A) The head of the agency shall, as part of this certification, give written notification to the congressional defense committees of—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) The cancellation ceiling amounts planned for each program year in the proposed multiyear contract, together with the reasons for the amounts planned;
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) The extent to which costs of contract cancellation are not included in the budget for the contract; and
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) A financial risk assessment of not including the budgeting for costs of contract cancellation (10 U.S.C. 3501(g)); and
                            </P>
                            <P>(B) The head of the agency shall provide copies of the notification to the Office of Management and Budget at least 14 days before contract award.</P>
                            <P>(3) The contract is for the procurement of a complete and usable end item (10 U.S.C. 3501(i)(5)(A)).</P>
                            <P>(4) Funds appropriated for any fiscal year for advance procurement are obligated only for the procurement of those long-lead items that are necessary in order to meet a planned delivery schedule for complete major end items that are programmed under the contract to be acquired with funds appropriated for a subsequent fiscal year (including an economic order quantity of such long-lead items when authorized by law (10 U.S.C. 3501(i)(5)(B)).</P>
                            <P>(5) The Secretary may make the certification under paragraph (h)(2) of this section notwithstanding the fact that one or more of the conditions of such certification are not met if the Secretary determines that, due to exceptional circumstances, proceeding with a multiyear contract under this section is in the best interest of the Department of Defense and the Secretary provides the basis for such determination with the certification (10 U.S.C. 3501(i)(6)).</P>
                            <P>(6) The Secretary of Defense may not delegate this authority to make the certification under paragraph (h)(2) of this section or the determination under paragraph (h)(5) of this section to an official below the level of the Under Secretary of Defense for Acquisition and Sustainment (10 U.S.C. 3501(i)(7)).</P>
                            <P>(7) All other requirements of law are met and there are no other statutory restrictions on using a multiyear contract for the specific system or component. One such restriction may be the achievement of specified cost savings. If the agency finds, after negotiations with the contractor(s), that the specified savings cannot be achieved, the head of the agency shall assess the savings that, nevertheless, could be achieved by using a multiyear contract. If the savings are substantial, the head of the agency may request relief from the law's specific savings requirement (10 U.S.C. 3501(i)(4)). The request shall—</P>
                            <P>(i) Quantify the savings that can be achieved;</P>
                            <P>(ii) Explain any other benefits to the Government of using the multiyear contract;</P>
                            <P>(iii) Include details regarding the negotiated contract terms and conditions; and</P>
                            <P>(iv) Be submitted to OUSD(A&amp;S)(DPCAP) for transmission to Congress via the Secretary of Defense and the President.</P>
                            <P>(i) The Secretary of Defense may instruct the head of the agency proposing a multiyear contract to include in that contract negotiated priced options for varying the quantities of end items to be procured over the life of the contract (10 U.S.C. 3501(j)).</P>
                            <P>
                                (j) Any requests for increased funding or reprogramming for procurement of a 
                                <PRTPAGE P="146"/>
                                major system under a multiyear contract shall be accompanied by an explanation of how the request for increased funding affects the determinations made by the Secretary of Defense under 217.172(h)(2) (10 U.S.C. 3501(m)).
                            </P>
                            <CITA>[76 FR 58153, Sept. 20, 2011, as amended at 80 FR 29982, May 26, 2015; 80 FR 36904, June 26, 2015; 81 FR 28731, May 10, 2016; 85 FR 61504, Sept. 29, 2020; 87 FR 76993, Dec. 16, 2022; 89 FR 60831, July 29, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.173</SECTNO>
                            <SUBJECT>Multiyear contracts for military family housing.</SUBJECT>
                            <P>The head of the agency may enter into multiyear contracts for periods up to 4 years for supplies and services required for management, maintenance, and operation of military family housing and may pay the costs of such contracts for each year from annual appropriations for that year (10 U.S.C. 2829).</P>
                            <CITA>[76 FR 58154, Sept. 20, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.174</SECTNO>
                            <SUBJECT>Multiyear contracts for electricity from renewable energy sources.</SUBJECT>
                            <P>(a) The head of the contracting activity may enter into a contract for a period not to exceed 10 years for the purchase of electricity from sources of renewable energy, as that term is defined in section 203(b)(2) of the Energy Policy Act of 2005 (42 U.S.C. 15852(b)(2)).</P>
                            <P>
                                (b) 
                                <E T="03">Limitations.</E>
                                 The head of the contracting activity may exercise the authority in paragraph (a) of this section to enter into a contract for a period in excess of 5 years only if the head of the contracting activity determines, on the basis of a business case analysis (see PGI 217.174 for a business case analysis template and guidance) prepared by the requiring activity, that—
                            </P>
                            <P>(1) The proposed purchase of electricity under such contract is cost effective; and</P>
                            <P>(2) It would not be possible to purchase electricity from the source in an economical manner without the use of a contract for a period in excess of 5 years.</P>
                            <P>(c) Nothing in this section shall be construed to preclude the DoD from using other multiyear contracting authority of DoD to purchase renewable energy.</P>
                            <CITA>[75 FR 34943, June 21, 2010. Redesignated and amended at 76 FR 58154, Sept. 20, 2011]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 217.2—Options</HD>
                        <SECTION>
                            <SECTNO>217.202</SECTNO>
                            <SUBJECT>Use of options.</SUBJECT>
                            <P>(1) See PGI 217.202 for guidance on the use of options.</P>
                            <P>(i) See PGI 217.202(1) for guidance on the use of options with foreign military sales (FMS).</P>
                            <P>(ii) See PGI 217.202(2) for the use options with sole source major systems for U.S. and U.S./FMS combined procurements.</P>
                            <P>(2) For a contract that is initially awarded from the competitive selection of a proposal resulting from a broad agency announcement, see 234.005-1 for the use of contract options for the development and demonstration or initial production of technology developed under the contract or the delivery of initial or additional items.</P>
                            <CITA>[75 FR 32638, June 8, 2010, as amended at 81 FR 17045, Mar. 25, 2016, 84 FR 65307, Nov. 27, 2019; 87 FR 25145, Apr. 28, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.204</SECTNO>
                            <SUBJECT>Contracts.</SUBJECT>
                            <P>(e)(i) Notwithstanding FAR 17.204(e), the ordering period of a task order or delivery order contract (including a contract for information technology) awarded by DoD pursuant to 10 U.S.C. 3403—</P>
                            <P>(A) May be for any period up to 5 years;</P>
                            <P>(B) May be subsequently extended for one or more successive periods in accordance with an option provided in the contract or a modification of the contract; and</P>
                            <P>(C) Shall not exceed 10 years unless the head of the agency determines in writing that exceptional circumstances require a longer ordering period.</P>
                            <P>(ii) Paragraph (e)(i) of this section does not apply to the following:</P>
                            <P>(A) Contracts, including task or delivery order contracts, awarded under other statutory authority.</P>
                            <P>(B) Advisory and assistance service task order contracts (authorized by 10 U.S.C. 3405 that are limited by statute to 5 years, with the authority to extend an additional 6 months (see FAR 16.505(c)).</P>
                            <P>(C) Definite-quantity contracts.</P>
                            <P>(D) GSA schedule contracts.</P>
                            <P>
                                (E) Multi-agency contracts awarded by agencies other than NASA, DoD, or the Coast Guard.
                                <PRTPAGE P="147"/>
                            </P>
                            <P>(iii) Obtain approval from the senior procurement executive before issuing an order against a task or delivery order contract subject to paragraph (e)(i) of this section, if performance under the order is expected to extend more than 1 year beyond the 10-year limit or extended limit described in paragraph (e)(i)(C) of this section (see FAR 37.106 for funding and term of service contracts).</P>
                            <CITA>[70 FR 73152, Dec. 9, 2005, as amended at 79 FR 58696, Sept. 30, 2014; 87 FR 76993, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.207</SECTNO>
                            <SUBJECT>Exercise of options.</SUBJECT>
                            <P>(c) In addition to the requirements at FAR 17.207(c), exercise an option only after:</P>
                            <P>(1) Determining that the contractor's record in the System for Award Management database is active and the contractor's unique entity identifier number, Commercial and Government Entity (CAGE) code, name, and physical address are accurately reflected in the contract document. See PGI 217.207 for the requirement to perform cost or price analysis of spare parts prior to exercising any option for firm-fixed-price contracts containing spare parts.</P>
                            <P>
                                (2) Verifying in the Supplier Performance Risk System (SPRS) (
                                <E T="03">https://www.sprs.csd.disa.mil/</E>
                                ) that—
                            </P>
                            <P>
                                (i) The summary level score of a current NIST SP 800-171 DoD Assessment (
                                <E T="03">i.e.,</E>
                                 not more than 3 years old, unless a lesser time is specified in the solicitation) for each covered contractor information system that is relevant to an offer, contract, task order, or delivery order are posted (see 204.7303).
                            </P>
                            <P>
                                (ii) The contractor has a CMMC certificate at the level required by the contract, and that it is current (
                                <E T="03">i.e.,</E>
                                 not more than 3 years old) (see 204.7502).
                            </P>
                            <CITA>[85 FR 61520, Sept. 29, 2020, as amended at 89 FR 79002, Sept. 26, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.208</SECTNO>
                            <SUBJECT>Solicitation provisions and contract clauses.</SUBJECT>
                            <P>Sealed bid solicitations shall not include provisions for evaluations of options unless the contracting officer determines that there is a reasonable likelihood that the options will be exercised (10 U.S.C. 3206(e)). This limitation also applies to sealed bid solicitations for the contracts excluded by FAR 17.200.</P>
                            <CITA>[63 FR 11529, Mar. 9, 1998, as amended at 71 FR 27642, May 12, 2006; 87 FR 76993, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.208-70</SECTNO>
                            <SUBJECT>Additional clauses.</SUBJECT>
                            <P>(a) Use the basic or the alternate of the clause at 252.217-7000, Exercise of Option to Fulfill Foreign Military Sales Commitments, in solicitations and contracts when an option may be used for foreign military sales requirements. Do not use the basic or the alternate of this clause in contracts for establishment or replenishment of DoD inventories or stocks, or acquisitions made under DoD cooperative logistics support arrangements.</P>
                            <P>(1) Use the basic clause when the foreign military sales country is known at the time of solicitation or award.</P>
                            <P>(2) Use the alternate I clause when the foreign military sale country is not known at the time of solicitation or award.</P>
                            <P>(b) When a surge option is needed in support of industrial capability production planning, use the clause at 252.217-7001, Surge Option, in solicitations and contracts.</P>
                            <P>(1) Insert the percentage or quantity of increase the option represents in paragraph (a) of the clause to ensure adequate quantities are available to meet item requirements.</P>
                            <P>(2) Change 30 days in paragraphs (b)(2) and (d)(1) to longer periods, if appropriate.</P>
                            <P>(3) Change the 24-month period in paragraph (c)(3), if appropriate.</P>
                            <CITA>[63 FR 11529, Mar. 9, 1998, as amended at 71 FR 27642, May 12, 2006; 79 FR 65593, Nov. 5, 2014; 83 FR 62503, Dec. 4, 2018]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 217.5—Interagency Acquisitions</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>63 FR 11530, Mar. 9, 1998, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>217.500</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>
                                (a) Unless more specific statutory authority exists, the procedures in FAR subpart 17.5 and this subpart apply to all purchases, except micro-purchases, made for DoD by another agency. This 
                                <PRTPAGE P="148"/>
                                includes orders under a task or delivery order contract entered into by the other agency. (Pub. L. 105-261, Section 814.)
                            </P>
                            <P>(b) A contracting activity from one DoD Component may provide acquisition assistance to deployed DoD units or personnel from another DoD Component. See PGI 217.502-1 for guidance and procedures.</P>
                            <CITA>[64 FR 14400, Mar. 25, 1999, as amended at 76 FR 76319, Dec. 7, 2011; 80 FR 36718, June 26, 2015; 80 FR 74695, Nov. 30, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.502</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.502-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Written agreement on responsibility for management and administration</E>
                                —
                            </P>
                            <P>
                                (1) 
                                <E T="03">Assisted acquisitions.</E>
                                 Follow the procedures at PGI 217.502-1(a)(1), when a contracting activity from a DoD Component provides acquisition assistance to deployed DoD units or personnel from another DoD Component.
                            </P>
                            <CITA>[83 FR 62502, Dec. 4, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.503</SECTNO>
                            <SUBJECT>Ordering procedures.</SUBJECT>
                            <P>(a) When the requesting agency is within DoD, a copy of the executed determination and findings required by FAR 17.502-2 shall be furnished to the servicing agency as an attachment to the order. When a DoD contracting office is acting as the servicing agency, a copy of the executed determination and findings shall be obtained from the requesting agency and placed in the contract file for the Economy Act order.</P>
                            <CITA>[76 FR 76319, Dec. 7, 2011]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 217.6—Management and Operating Contracts</HD>
                        <SECTION>
                            <SECTNO>217.600</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>FAR subpart 17.6 does not apply to DoD.</P>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 217.7—Interagency Acquisitions: Acquisitions by Nondefense Agencies on Behalf of the Department of Defense</HD>
                        <CITA>[80 FR 51751, Aug. 26, 2015]</CITA>
                        <SECTION>
                            <SECTNO>217.700</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>This subpart—</P>
                            <P>(a) Implements section 854 of the National Defense Authorization Act for Fiscal Year 2005 (Pub. L. 108-375), section 801 of the National Defense Authorization Act for Fiscal Year 2008 (Pub. L. 110-181), and section 806 of the National Defense Authorization Act for Fiscal Year 2010 (Pub. L. 111-84); and</P>
                            <P>(b) Prescribes policy for the acquisition of supplies and services through the use of contracts or orders issued by non-DoD agencies.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.701</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this subpart—</P>
                            <P>
                                <E T="03">Assisted acquisition</E>
                                 means the type of interagency contracting through which acquisition officials of a non-DoD agency award a contract or a task or delivery order for the acquisition of supplies or services on behalf of DoD.
                            </P>
                            <P>
                                <E T="03">Direct acquisition</E>
                                 means the type of interagency contracting through which DoD orders a supply or service from a Governmentwide acquisition contract maintained by a non-DoD agency.
                            </P>
                            <P>
                                <E T="03">Governmentwide acquisition contract</E>
                                 means a task or delivery order contract that—
                            </P>
                            <P>(1) Is entered into by a non-defense agency; and</P>
                            <P>(2) May be used as the contract under which property or services are procured for one or more other departments or agencies of the Federal Government.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.770</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>Departments and agencies shall establish and maintain procedures for reviewing and approving orders placed for supplies and services under non-DoD contracts, whether through direct acquisition or assisted acquisition, when the amount of the order exceeds the simplified acquisition threshold. These procedures shall include—</P>
                            <P>(a) Evaluating whether using a non-DoD contract for the acquisition is in the best interest of DoD. Factors to be considered include—</P>
                            <P>(1) Satisfying customer requirements;</P>
                            <P>(2) Schedule;</P>
                            <P>
                                (3) Cost effectiveness (taking into account discounts and fees). In order to ensure awareness of the total cost of fees associated with use of a non-DoD 
                                <PRTPAGE P="149"/>
                                contract, follow the procedures at PGI 217.770(a)(3); and
                            </P>
                            <P>(4) Contract administration (including oversight);</P>
                            <P>(b) Determining that the tasks to be accomplished or supplies to be provided are within the scope of the contract to be used;</P>
                            <P>(c) Reviewing funding to ensure that it is used in accordance with appropriation limitations; and</P>
                            <P>(d) Collecting and reporting data on the use of assisted acquisition for analysis. Follow the reporting requirements in subpart 204.6.</P>
                            <CITA>[80 FR 51751, Aug. 26, 2015, as amended at 80 FR 56930, Sept. 21, 2015]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 217.70—Exchange of Personal Property</HD>
                        <SECTION>
                            <SECTNO>217.7000</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>This subpart prescribes policy and procedures for exchange of nonexcess personal property concurrent with an acquisition. 40 U.S.C. 503 permits exchange of personal property and application of the exchange allowance to the acquisition of similar property. This subpart does not authorize the sale of nonexcess personal property.</P>
                            <CITA>[63 FR 11529, Mar. 9, 1998, as amended at 77 FR 35880, June 15, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7001</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this subpart—</P>
                            <P>
                                (a) 
                                <E T="03">Exchange (trade-in) property</E>
                                 means property which—
                            </P>
                            <P>(1) Is not excess but is eligible for replacement (because of obsolescence, unserviceability, or other reason); and</P>
                            <P>(2) Is applied as whole or partial payment toward the acquisition of similar items (i.e., items designed and constructed for the same purpose).</P>
                            <P>
                                (b) 
                                <E T="03">Property</E>
                                 means items that fall within one of the generic categories listed in DoD Manual 4140.01, Volume 9, DoD Supply Chain Materiel Management Procedures: Materiel Programs.
                            </P>
                            <CITA>[56 FR 36345, July 31, 1991, as amended at 65 FR 39705, June 27, 2000; 77 FR 23631, Apr. 20, 2012; 82 FR 61480, Dec. 28, 2017]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7002</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>DoD policy is to exchange, rather than replace, eligible nonexcess property whenever exchange promotes economical and efficient program accomplishment. Exchange policy, authority, and applicability are governed by—</P>
                            <P>(a) The Federal Property Management Regulations issued by the Administrator of the General Services Administration; and</P>
                            <P>(b) DoD Manual 4140.01, Volume 9, DoD Supply Chain Materiel Management Procedures: Materiel Programs.</P>
                            <CITA>[56 FR 36345, July 31, 1991, as amended at 65 FR 39705, June 27, 2000; 77 FR 23631, Apr. 20, 2012; 82 FR 61480, Dec. 28, 2017]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7003</SECTNO>
                            <SUBJECT>Purchase request.</SUBJECT>
                            <P>Ensure that the requiring activity provides all of the following in support of the purchase request—</P>
                            <P>(a) A certification that the property is eligible for exchange and complies with all conditions and limitations of DoD Manual 4140.01, Volume 9, DoD Supply Chain Materiel Management Procedures: Materiel Programs.</P>
                            <P>(b) A written determination of economic advantage indicating—</P>
                            <P>(1) The anticipated economic advantage to the Government from use of the exchange authority;</P>
                            <P>(2) That exchange allowances shall be applied toward, or in partial payment of, the items to be acquired; and</P>
                            <P>(3) That, if required, the exchange property has been rendered safe or innocuous or has been demilitarized;</P>
                            <P>(c) All applicable approvals for the exchange; and</P>
                            <P>(d) A description of the property available for exchange (e.g., nomenclature, location, serial number, estimated travel value).</P>
                            <CITA>[56 FR 36345, July 31, 1991, as amended at 65 FR 39705, June 27, 2000; 77 FR 23632, Apr. 20, 2012; 82 FR 61480, Dec. 28, 2017]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7004</SECTNO>
                            <SUBJECT>Solicitation and award.</SUBJECT>
                            <P>(a) Solicitations shall include a request for offerors to state prices—</P>
                            <P>(1) For the new items being acquired without any exchange; and</P>
                            <P>(2) For the new items with the exchange (trade-in allowance) for the exchange property listed.</P>
                            <P>
                                (b) The contracting officer is not obligated to award on an exchange basis. If the lowest evaluated offer is an offer for the new items without any exchange, the contracting officer may 
                                <PRTPAGE P="150"/>
                                award on that basis and forgo the exchange.
                            </P>
                            <P>(c) Exchanges may be made only with the successful offeror. When the successful offer includes an exchange, award one contract for both the acquisition of the new property and the trade-in of the exchange property. The only exception is when the items must be acquired against a mandatory Federal supply schedule contract, in which case, award a separate contract for the exchange.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7005</SECTNO>
                            <SUBJECT>Solicitation provision.</SUBJECT>
                            <P>Use the provision at 252.217-7002, Offering Property for Exchange, when offering nonexcess personal property for exchange. Allow a minimum of 14 calendar days for the inspection period in paragraph (b) of the clause if the exchange property is in the contiguous United States. Allow at least 21 calendar days outside the contiguous United States.</P>
                            <CITA>[70 FR 35544, June 21, 2005]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 217.71—Master Agreement for Repair and Alteration of Vessels</HD>
                        <SECTION>
                            <SECTNO>217.7100</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>This subpart contains acquisition policies and procedures for master agreements for repair and alteration of vessels.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7101</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Master agreement for repair and alteration of vessels</E>
                                —
                            </P>
                            <P>(1) Is a written instrument of understanding, negotiated between a contracting activity and a contractor that—</P>
                            <P>(A) Contains contract clauses, terms, and conditions applying to future contracts for repairs, alterations, and/or additions to vessels; and</P>
                            <P>(B) Contemplates separate future contracts that will incorporate by reference or attachment the required and applicable clauses agreed upon in the master agreement.</P>
                            <P>(2) Is not a contract.</P>
                            <P>
                                (b) 
                                <E T="03">Job order</E>
                                —
                            </P>
                            <P>(1) Is a fixed price contract incorporating, by reference or attachment, a master agreement for repair and alteration of vessels;</P>
                            <P>(2) May include clauses pertaining to subjects not covered by the master agreement; but applicable to the job order being awarded; and</P>
                            <P>(3) Applies to a specific acquisition and sets forth the scope of work, price, delivery date, and other appropriate terms that apply to the particular job order.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7102</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>(a) Activities shall enter into master agreements for repair and alteration of vessels with all prospective contractors located within the United States or its outlying areas, which—</P>
                            <P>(1) Request ship repair work; and</P>
                            <P>(2) Possess the organization and facilities to perform the work satisfactorily. (Issuance of a master agreement does not indicate approval of the contractor's facility for any particular acquisition and is not an affirmative determination of responsibility under FAR subpart 9.1 for any particular acquisition.)</P>
                            <P>(b) Activities may use master agreements in work with prospective contractors located outside the United States and its outlying areas.</P>
                            <P>(c) Activities may issue job orders under master agreements to effect repairs, alterations, and/or additions to vessels belonging to foreign governments.</P>
                            <P>(1) Contractors shall treat vessels of a foreign government as if they were vessels of the U.S. Government whenever requested to do so by the contracting officer.</P>
                            <P>(2) Identify the vessel and the foreign government in the solicitation and job order.</P>
                            <CITA>[56 FR 36345, July 31, 1991, as amended at 70 FR 35544, June 21, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7103</SECTNO>
                            <SUBJECT>Master agreements and job orders.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7103-1</SECTNO>
                            <SUBJECT>Content and format of master agreements.</SUBJECT>
                            <P>Follow the procedures at PGI 217.7103-1 for preparation of master agreements.</P>
                            <CITA>[71 FR 27642, May 12, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="151"/>
                            <SECTNO>217.7103-2</SECTNO>
                            <SUBJECT>Period of agreement.</SUBJECT>
                            <P>(a) Master agreements remain in effect until canceled by either the contractor or the contracting officer.</P>
                            <P>(b) Master agreements can be canceled by either the contractor or the contracting officer by giving 30 days written notice to the other.</P>
                            <P>(c) Cancellation of a master agreement does not affect the rights and liabilities under any job order existing at the time of cancellation. The contractor must continue to perform all work covered by any job order issued before the effective date of cancellation of the master agreement.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7103-3</SECTNO>
                            <SUBJECT>Solicitations for job orders.</SUBJECT>
                            <P>(a) When a requirement arises within the United States or its outlying areas for the type of work covered by the master agreement, solicit offers from prospective contractors that—</P>
                            <P>(1) Previously executed a master agreement; or</P>
                            <P>(2) Have not previously executed a master agreement, but possess the necessary qualifications to perform the work and agree to execute a master agreement before award of a job order.</P>
                            <P>(b) Follow the procedures at PGI 217.7103-3 when preparing solicitations for job orders.</P>
                            <CITA>[56 FR 36345, July 31, 1991, as amended at 63 FR 55052, Oct. 14, 1998; 63 FR 56290, Oct. 21, 1998; 70 FR 35545, June 21, 2005; 71 FR 27642, May 12, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7103-4</SECTNO>
                            <SUBJECT>Emergency work.</SUBJECT>
                            <P>(a) The contracting officer, without soliciting offers, may issue a written job order to a contractor that has previously executed a master agreement when—</P>
                            <P>(i) Delay in the performance of necessary repair work would endanger a vessel, its cargo or stores; or</P>
                            <P>(ii) Military necessity requires immediate work on a vessel.</P>
                            <P>(b) Follow the procedures at PGI 217.7103-4 when processing this type of undefinitized contract action.</P>
                            <CITA>[56 FR 36345, July 31, 1991. Redesignated and amended at 71 FR 27643, May 12, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7103-5</SECTNO>
                            <SUBJECT>Repair costs not readily ascertainable.</SUBJECT>
                            <P>Follow the procedures at PGI 217.7103-5 if the nature of any repairs is such that their extent and probable cost cannot be ascertained readily.</P>
                            <CITA>[71 FR 27643, May 12, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7103-6</SECTNO>
                            <SUBJECT>Modification of master agreements.</SUBJECT>
                            <P>(a) Review each master agreement at least annually before the anniversary of its effective date and revise it as necessary to conform to the requirements of the FAR and DFARS. Statutory or other mandatory changes may require review and revision earlier than one year.</P>
                            <P>(b) A master agreement shall be changed only by modifying the master agreement itself. It shall not be changed through a job order.</P>
                            <P>(c) A modification to a master agreement shall not affect job orders issued before the effective date of the modification.</P>
                            <CITA>[63 FR 11529, Mar. 9, 1998. Redesignated at 71 FR 27643, May 12, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7104</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>(a) Use the following clauses in solicitations for, and in, master agreements for repair and alteration of vessels:</P>
                            <P>(1) 252.217-7003, Changes.</P>
                            <P>(2) 252.217-7004, Job Orders and Compensation.</P>
                            <P>(3) 252.217-7005, Inspection and Manner of Doing Work.</P>
                            <P>(4) 252.217-7006, Title.</P>
                            <P>(5) 252.217-7007, Payments.</P>
                            <P>(6) 252.217-7008, Bonds.</P>
                            <P>(7) 252.217-7009, Default.</P>
                            <P>(8) 252.217-7010, Performance.</P>
                            <P>(9) 252.217-7011, Access to Vessel.</P>
                            <P>(10) 252.217-7012, Liability and Insurance.</P>
                            <P>(11) 252.217-7013, Guarantees.</P>
                            <P>(12) 252.217-7014, Discharge of Liens.</P>
                            <P>(13) 252.217-7015, Safety and Health.</P>
                            <P>(14) 252.217-7016, Plant Protection, as applicable.</P>
                            <P>
                                (b)(1) Incorporate in solicitations for, and in, job orders, the clauses in the master agreement, and any other clauses on subjects not covered by the master agreement, but applicable to the job order to be awarded.
                                <PRTPAGE P="152"/>
                            </P>
                            <P>(2) Use the clause at 252.217-7016, Plant Protection, in job orders where performance is to occur at the contractor's facility.</P>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <RESERVED>Subpart 217.72 [Reserved]</RESERVED>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 217.73—Identification of Sources of Supply</HD>
                        <SECTION>
                            <SECTNO>217.7300</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>This subpart implements 10 U.S.C. 4753. It contains policy and procedures for requiring contractors to identify the actual manufacturer of supplies furnished to DoD.</P>
                            <CITA>[56 FR 36284, July 31, 1991, as amended at 87 FR 76993, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7301</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>Contractors shall identify their sources of supply in contracts for supplies. Contractor identification of sources of supply enables solicitation, in subsequent acquisitions, of actual manufacturers or other suppliers of items. This enhances competition and potentially avoids payment of additional costs for no significant added value.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7302</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>(a) Whenever practicable, include a requirement for contractor identification of sources of supply in all contracts for the delivery of supplies. The identification shall include—</P>
                            <P>(1) The item's actual manufacturer or producer, or all the contractor's sources for the item;</P>
                            <P>(2) The item's national stock number (if there is one);</P>
                            <P>(3) The item identification number used by—</P>
                            <P>(i) The actual manufacturer or producer of the item; or</P>
                            <P>(ii) Each of the contractor's sources for the item; and</P>
                            <P>(4) The source of any technical data delivered under the contract.</P>
                            <P>(b) The requirement in paragraph (a) of this section does not apply to contracts that are—</P>
                            <P>(1) For commercial products; or</P>
                            <P>(2) Valued at or below the simplified acquisition threshold.</P>
                            <CITA>[56 FR 36345, July 31, 1991, as amended at 64 FR 2597, Jan. 15, 1999; 88 FR 6583, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7303</SECTNO>
                            <SUBJECT>Solicitation provision.</SUBJECT>
                            <P>(a) Use the provision at 252.217-7026, Identification of Sources of Supply, or one substantially the same, in all solicitations for supplies when the acquisition is being conducted under other than full and open competition, except when—</P>
                            <P>(1) Using FAR 6.302-5;</P>
                            <P>(2) The contracting officer already has the information required by the provision (e.g., the information was obtained under other acquisitions);</P>
                            <P>(3) The contract is for subsistence, clothing or textiles, fuels, or supplies purchased and used outside the United States;</P>
                            <P>(4) The contracting officer determines that it would not be practicable to require offerors/contractors to provide the information, e.g., nonrepetitive local purchases; or</P>
                            <P>(5) The contracting officer determines that the exception at 217.7302(b) applies to all items under the solicitation.</P>
                            <P>(b) If appropriate, use the provision at 252.217-7026, Identification of Sources of Supply, or one substantially the same, in service contracts requiring the delivery of supplies.</P>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 217.74—Undefinitized Contract Actions</HD>
                        <SECTION>
                            <SECTNO>217.7400</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>
                                This subpart prescribes policies and procedures implementing 10 U.S.C. 3371, 
                                <E T="03">et seq.</E>
                            </P>
                            <CITA>[56 FR 36284, July 31, 1991, as amended at 87 FR 76993, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7401</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this subpart—</P>
                            <P>
                                <E T="03">Contract action</E>
                                 means an action which results in a contract.
                            </P>
                            <P>(1) It includes contract modifications for additional supplies or services.</P>
                            <P>
                                (2) It includes task orders and delivery orders.
                                <PRTPAGE P="153"/>
                            </P>
                            <P>
                                (3) It does not include change orders, administrative changes, funding modifications, or any other contract modifications that are within the scope and under the terms of the contract, 
                                <E T="03">e.g.,</E>
                                 engineering change proposals, value engineering change proposals, and over and above work requests as described in subpart 217.77. For policy relating to definitization of change orders, see 243.204-70.
                            </P>
                            <P>
                                <E T="03">Definitization</E>
                                 means the agreement on, or determination of, contract terms, specifications, and price, which converts the undefinitized contract action to a definitive contract.
                            </P>
                            <P>
                                <E T="03">Qualifying proposal</E>
                                 means a proposal that contains sufficient information to enable DoD to conduct meaningful analyses and audits of the information contained in the proposal.
                            </P>
                            <P>
                                <E T="03">Undefinitized contract action</E>
                                 means any contract action for which the contract terms, specifications, or price are not agreed upon before performance is begun under the action. Examples are letter contracts, orders under basic ordering agreements, and provisioned item orders, for which the price has not been agreed upon before performance has begun. For policy relating to definitization of change orders, see 243.204-70.
                            </P>
                            <CITA>[56 FR 36345, July 31, 1991, as amended at 75 FR 10191, Mar. 5, 2010; 75 FR 48277, Aug. 10, 2010; 77 FR 76940, Dec. 31, 2012; 84 FR 39206, Aug. 9, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7402</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <P>(a) The following undefinitized contract actions (UCAs) are not subject to this subpart. However, the contracting officer shall apply the policy and procedures to them to the maximum extent practicable (also see paragraph (b) of this section):</P>
                            <P>(1) Purchases at or below the simplified acquisition threshold.</P>
                            <P>(2) Special access programs.</P>
                            <P>(3) Congressionally mandated long-lead procurement contracts.</P>
                            <P>
                                (b) If the contracting officer determines that it is impracticable to adhere to the procedures of this subpart for a particular contract action that falls within one of the categories in paragraph (a) of this section, the contracting officer shall provide prior notice, through agency channels, electronically via email to the Principal Director, Defense Pricing, Contracting, and Acquisition Policy (Contract Policy), at 
                                <E T="03">osd.pentagon.ousd-a-s.mbx.dpc-cp@mail.mil.</E>
                            </P>
                            <CITA>[75 FR 48277, Aug. 10, 2010, as amended at 80 FR 72607, Nov. 20, 2015; 84 FR 39206, Aug. 9, 2019; 84 FR 48510, Sept. 13, 2019; 89 FR 60831, July 29, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7403</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>DoD policy is that undefinitized contract actions shall—</P>
                            <P>(a) Be used only when—</P>
                            <P>(1) The negotiation of a definitive contract action is not possible in sufficient time to meet the Government's requirements; and</P>
                            <P>(2) The Government's interest demands that the contractor be given a binding commitment so that contract performance can begin immediately.</P>
                            <P>(b) Be as complete and definite as practicable under the particular circumstances.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7404</SECTNO>
                            <SUBJECT>Limitations.</SUBJECT>
                            <P>See PGI 217.7404 for additional guidance on obtaining approval to authorize use of an undefinitized contact action, documentation requirements, and other limitations on their use.</P>
                            <P>
                                (a) 
                                <E T="03">Foreign military sales contracts.</E>
                            </P>
                            <P>(1) A contracting officer may not enter into a UCA for a foreign military sale unless—</P>
                            <P>(i) The UCA provides for agreement upon contractual terms, specifications, and price by the end of the 180-day period beginning on the date on which the contractor submits a qualifying proposal; and</P>
                            <P>(ii) The contracting officer obtains approval from the head of the contracting activity to enter into a UCA in accordance with 217.7404-1.</P>
                            <P>(2) The head of the contracting activity may waive the requirements of paragraph (a)(1) of this section, if a waiver is necessary in order to support any of the following operations:</P>
                            <P>(i) A contingency operation.</P>
                            <P>(ii) A humanitarian or peacekeeping operation.</P>
                            <P>
                                (b) 
                                <E T="03">Unilateral definitization by a contracting officer.</E>
                                 Any UCA with a value greater than $50 million may not be unilaterally definitized until—
                            </P>
                            <P>
                                (1) The earlier of—
                                <PRTPAGE P="154"/>
                            </P>
                            <P>(i) The end of the 180-day period, beginning on the date on which the contractor submits a qualifying proposal to definitize the contractual terms, specifications, and price; or</P>
                            <P>(ii) The date on which the amount of funds expended under the contractual action is equal to more than 50 percent of the negotiated overall not-to-exceed price for the contractual action;</P>
                            <P>(2) The head of the contracting activity, without power of redelegation, approves the definitization in writing;</P>
                            <P>(3) The contracting officer provides a copy of the written approval to the contractor; and</P>
                            <P>(4) A period of 30 calendar days has elapsed after the written approval is provided to the contractor.</P>
                            <CITA>[84 FR 39206, Aug. 9, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7404-1</SECTNO>
                            <SUBJECT>Authorization.</SUBJECT>
                            <P>The contracting officer shall obtain approval from the head of the contracting activity before—</P>
                            <P>(a) Entering into a UCA. The request for approval must fully explain the need to begin performance before definitization, including the adverse impact on agency requirements resulting from delays in beginning performance.</P>
                            <P>(b) Including requirements for non-urgent spare parts and support equipment in a UCA. The request should show that inclusion of the non-urgent items is consistent with good business practices and in the best interest of the United States.</P>
                            <P>(c) Modifying the scope of a UCA when performance has already begun. The request should show that the modification is consistent with good business practices and in the best interests of the United States.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7404-2</SECTNO>
                            <SUBJECT>Price ceiling.</SUBJECT>
                            <P>UCAs shall include a not-to-exceed price.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7404-3</SECTNO>
                            <SUBJECT>Definitization schedule.</SUBJECT>
                            <P>(a) UCAs shall contain definitization schedules that provide for definitization by the earlier of—</P>
                            <P>(1) The date that is 180 days after the contractor submits a qualifying proposal. This date may not be extended beyond an additional 90 days without a written determination by the head of the contracting activity without power of redelegation, the commander of the combatant command concerned, or the Under Secretary of Defense for Acquisition and Sustainment that it is in the best interests of the military department or the defense agency, the combatant command, or the Department of Defense, respectively, to continue the action; or</P>
                            <P>(2) The date on which the amount of funds obligated under the contract action is equal to more than 50 percent of the not-to-exceed price.</P>
                            <P>(b)(1) Submission of a qualifying proposal in accordance with the definitization schedule is a material element of the contract. If the contractor does not submit a qualifying proposal in accordance with the contract definitization schedule, notwithstanding FAR 52.216-26, Payments of Allowable Costs Before Definitization, the contracting officer may withhold an amount necessary to protect the interests of the Government, not to exceed 5 percent of all subsequent financing requests, or take other appropriate actions (e.g., documenting the noncompliance in the contractor's past performance evaluation or terminating the contract for default).</P>
                            <P>(2) Contracting officers shall document in the contract file the justification for withholding or not withholding payments if the qualifying proposal was not submitted in accordance with the contract definitization schedule.</P>
                            <CITA>[56 FR 36345, July 31, 1991, as amended at 60 FR 29498, June 5, 1995; 63 FR 67803, Dec. 9, 1998; 84 FR 39206, Aug. 9, 2019; 88 FR 33837, May 25, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7404-4</SECTNO>
                            <SUBJECT>Limitations on obligations.</SUBJECT>
                            <P>
                                (a) The Government shall not obligate more than 50 percent of the not-to-exceed price before definitization. However, if a contractor submits a qualifying proposal before 50 percent of the not-to-exceed price has been obligated by the Government, then the limitation on obligations before definitization may be increased to no more than 75 percent (see 232.102-70 for coverage on provisional delivery payments).
                                <PRTPAGE P="155"/>
                            </P>
                            <P>(b) In determining the appropriate amount to obligate, the contracting officer shall assess the contractor's proposal for the undefinitized period and shall obligate funds only in an amount consistent with the contractor's requirements for the undefinitized period.</P>
                            <CITA>[60 FR 29498, June 5, 1995, as amended at 74 FR 37650, July 29, 2009]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7404-5</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <P>(a) The limitations in 217.7404-2, 217.7404-3, and 217.7404-4 do not apply to UCAs for the purchase of initial spares.</P>
                            <P>(b) The head of an agency may waive the limitations in 217.7404(a), 217.7404-2, 217.7404-3, and 217.7404-4 for UCAs if the head of the agency determines that the waiver is necessary to support—</P>
                            <P>(1) A contingency operation; or</P>
                            <P>(2) A humanitarian or peacekeeping operation.</P>
                            <CITA>[60 FR 29498, June 5, 1995, as amended at 63 FR 67804, Dec. 9, 1998; 71 FR 27643, May 12, 2006; 84 FR 39206, Aug. 9, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7404-6</SECTNO>
                            <SUBJECT>Allowable profit.</SUBJECT>
                            <P>When the final price of a UCA is negotiated after a substantial portion of the required performance has been completed, the head of the contracting activity shall ensure the profit allowed reflects—</P>
                            <P>(a) Any reduced cost risk to the contractor for costs incurred during contract performance before negotiation of the final price. However, if a contractor submits a qualifying proposal to definitize a UCA, and the contracting officer for such action definitizes the contract after the end of the 180-day period beginning on the date on which the contractor submitted the qualifying proposal, the profit allowed on the contract shall accurately reflect the cost risk of the contractor as such risk existed on the date the contractor submitted the qualifying proposal;</P>
                            <P>(b) Any reduced cost risk to the contractor for costs expected to be incurred during performance of the remainder of the contract after negotiation of the final price; and</P>
                            <P>(c) The requirements at 215.404-71-3(d)(2). The risk assessment shall be documented in the price negotiation memorandum.</P>
                            <CITA>[74 FR 37650, July 29, 2009, as amended at 83 FR 30586, June 29, 2018; 84 FR 39206, Aug. 9, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7405</SECTNO>
                            <SUBJECT>Plans and reports.</SUBJECT>
                            <P>(a) To provide for enhanced management and oversight of UCAs, departments and agencies shall—</P>
                            <P>(1) Prepare and maintain a Consolidated UCA Management Plan; and</P>
                            <P>(2) Prepare semi-annual Consolidated UCA Management Reports addressing each UCA with an estimated value exceeding $5 million.</P>
                            <P>
                                (b) Consolidated UCA Management Reports and Consolidated UCA Management Plan updates shall be submitted to the Office of the Principal Director, Defense Pricing, Contracting, and Acquisition Policy (Contract Policy) at 
                                <E T="03">osd.pentagon.ousd-a-s.mbx.asda-dp-c-contractpolicy@mail.mil</E>
                                , by October 31 and April 30 of each year in accordance with the procedures at PGI 217.7405.
                            </P>
                            <P>
                                (c) Consolidated UCA Management Reports shall include information about all change orders that are not forward priced (
                                <E T="03">i.e.,</E>
                                 unpriced) and have an estimated value exceeding $5 million.
                            </P>
                            <CITA>[74 FR 37650, July 29, 2009, as amended at 75 FR 48277, Aug. 10, 2010; 88 FR 73236, Oct. 25, 2023; 89 FR 60831, July 29, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7406</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>(a) Use the clause at FAR 52.216-24, Limitation of Government Liability, in—</P>
                            <P>(1) All UCAs;</P>
                            <P>(2) Solicitations associated with UCAs;</P>
                            <P>(3) Basic ordering agreements;</P>
                            <P>(4) Indefinite-delivery contracts;</P>
                            <P>(5) Any other type of contract providing for the use of UCAs; and</P>
                            <P>(6) Unpriced change orders with an estimated value exceeding $5 million.</P>
                            <P>(b)(1) Use the clause at 252.217-7027, Contract Definitization, in—</P>
                            <P>(i) All UCAs;</P>
                            <P>(ii) Solicitations associated with UCAs;</P>
                            <P>(iii) Basic ordering agreements;</P>
                            <P>(iv) Indefinite-delivery contracts;</P>
                            <P>
                                (v) Any other type of contract providing for the use of UCAs; and
                                <PRTPAGE P="156"/>
                            </P>
                            <P>(vi) Unpriced change orders with an estimated value exceeding $5 million.</P>
                            <P>(2) Insert the applicable information in paragraphs (a), (b), and (d) of the clause.</P>
                            <P>(3) If, at the time of entering into the UCA or unpriced change order, the contracting officer knows that the definitive contract action will meet the criteria of FAR 15.403-1, 15.403-2, or 15.403-3 for not requiring submission of certified cost or pricing data, the words “and certified cost or pricing data” may be deleted from paragraph (a) of the clause.</P>
                            <CITA>[75 FR 48277, Aug. 10, 2010, as amended at 77 FR 76940, Dec. 31, 2012]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 217.75—Acquisition of Replenishment Parts</HD>
                        <SECTION>
                            <SECTNO>217.7500</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>This subpart provides guidance on additional requirements related to acquisition of replenishment parts.</P>
                            <CITA>[56 FR 36345, July 31, 1991, as amended at 71 FR 27643, May 12, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7501</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <P>
                                <E T="03">Replenishment parts,</E>
                                 as used in this subpart, means repairable or consumable parts acquired after the initial provisioning process.
                            </P>
                            <CITA>[71 FR 27643, May 12, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7502</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>Departments and agencies—</P>
                            <P>(a) May acquire replenishment parts concurrently with production of the end item.</P>
                            <P>(b) Shall provide for full and open competition when fully adequate drawings and any other needed data are available with the right to use for acquisition purposes (see part 227). However—</P>
                            <P>(1) When data is not available for a competitive acquisition, use one of the procedures in PGI 217.7504.</P>
                            <P>(2) Replenishment parts must be acquired so as to ensure the safe, dependable, and effective operation of the equipment. Where this assurance is not possible with new sources, competition may be limited to the original manufacturer of the equipment or other sources that have previously manufactured or furnished the parts as long as the action is justified. See 209.270 for requirements applicable to replenishment parts for aviation or ship critical safety items.</P>
                            <P>(c) Shall follow the limitations on price increases in 217.7505.</P>
                            <CITA>[56 FR 36345, July 31, 1991, as amended at 69 FR 55989, Sept. 17, 2004. Redesignated and amended at 71 FR 27643, May 12, 2006; 73 FR 1827, Jan. 10, 2008]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7503</SECTNO>
                            <SUBJECT>Spares acquisition integrated with production.</SUBJECT>
                            <P>Follow the procedures at PGI 217.7503 for acquiring spare parts concurrently with the end item.</P>
                            <CITA>[71 FR 27643, May 12, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7504</SECTNO>
                            <SUBJECT>Acquisition of parts when data is not available.</SUBJECT>
                            <P>Follow the procedures at PGI 217.7504 when acquiring parts for which the Government does not have the necessary data.</P>
                            <CITA>[71 FR 27643, May 12, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7505</SECTNO>
                            <SUBJECT>Limitations on price increases.</SUBJECT>
                            <P>This section provides implementing guidance for section 1215 of Public Law 98-94 (10 U.S.C. 2452 note).</P>
                            <P>(a) The contracting officer shall not award, on a sole source basis, a contract for any centrally managed replenishment part when the price of the part has increased by 25 percent or more over the most recent 12-month period.</P>
                            <P>(1) Before computing the percentage difference between the current price and the prior price, adjust for quantity, escalation, and other factors necessary to achieve comparability.</P>
                            <P>(2) Departments and agencies may specify an alternate percentage or percentages for contracts at or below the simplified acquisition threshold.</P>
                            <P>
                                (b) The contracting officer may award a contract for a part, the price of which exceeds the limitation in paragraph (a) of this section, if the contracting officer certifies in writing to the head of the contracting activity before award that—
                                <PRTPAGE P="157"/>
                            </P>
                            <P>(1) The contracting officer has evaluated the price of the part and concluded that the price increase is fair and reasonable; or</P>
                            <P>(2) The national security interests of the United States require purchase of the part despite the price increase.</P>
                            <P>(c) The fact that a particular price has not exceeded the limitation in paragraph (a) of this section does not relieve the contracting officer of the responsibility for obtaining a fair and reasonable price.</P>
                            <P>(d) Contracting officers may include a provision in sole source solicitations requiring that the offeror supply with its proposal, price and quantity data on any government orders for the replenishment part issued within the most recent 12 months.</P>
                            <CITA>[56 FR 36345, July 31, 1991, as amended at 64 FR 2598, Jan. 15, 1999. Redesignated at 71 FR 27643, May 12, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7506</SECTNO>
                            <SUBJECT>Spare parts breakout program.</SUBJECT>
                            <P>See PGI 217.7506 and DoD Manual 4140.01, Volume 9, DoD Supply Chain Materiel Management Procedures: Materiel Programs, for spare parts breakout requirements.</P>
                            <CITA>[71 FR 27643, May 12, 2006, as amended at 82 FR 61480, Dec. 28, 2017]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 217.76—Contracts with Provisioning Requirements</HD>
                        <SECTION>
                            <SECTNO>217.7601</SECTNO>
                            <SUBJECT>Provisioning.</SUBJECT>
                            <P>(a) Follow the procedures at PGI 217.7601 for contracts with provisioning requirements.</P>
                            <P>(b) For technical requirements of provisioning, see DoD Manual 4140.01, Volume 2, DoD Supply Chain Materiel Management Procedures: Demand and Supply Planning.</P>
                            <CITA>[71 FR 27643, May 12, 2006, as amended at 82 FR 61480, Dec. 28, 2017]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 217.77—Over and Above Work</HD>
                        <SECTION>
                            <SECTNO>217.7701</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>Follow the procedures at PGI 217.7701 when acquiring over and above work.</P>
                            <CITA>[71 FR 27643, May 12, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>217.7702</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at 252.217-7028, Over and Above Work, in solicitations and contracts containing requirements for over and above work, except as provided for in subpart 217.71.</P>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 217.78—Reverse Auctions</HD>
                        <SECTION>
                            <SECTNO>217.7801</SECTNO>
                            <SUBJECT>Prohibition.</SUBJECT>
                            <P>In accordance with section 814 of the National Defense Authorization Act for Fiscal Year 2017 (Pub. L. 114-328) as amended by section 882 of the National Defense Authorization Act for Fiscal Year 2018 (Pub. L. 115-91), contracting officers shall not use reverse auctions when procuring items designated by the requiring activity as personal protective equipment or an aviation critical safety item, when the requiring activity advises the contracting officer that the level of quality or failure of the equipment or item could result in combat casualties. See 252.209-7010 for the definition and identification of critical safety items.</P>
                            <CITA>[84 FR 50789, Sept. 26, 2019, as amended at 87 FR 76993, Dec. 16, 2022]</CITA>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 218</EAR>
                    <HD SOURCE="HED">PART 218—EMERGENCY ACQUISITIONS</HD>
                    <CONTENTS>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 218.1—Available Acquisition Flexibilities</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>218.170</SECTNO>
                            <SUBJECT>Additional acquisition flexibilities.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 218.2—Emergency Acquisition Flexibilities</HD>
                            <SECTNO>218.201</SECTNO>
                            <SUBJECT>Contingency operation.</SUBJECT>
                            <SECTNO>218.202</SECTNO>
                            <SUBJECT>Defense or recovery from certain events.</SUBJECT>
                            <SECTNO>218.203</SECTNO>
                            <SUBJECT>Emergency declaration or major disaster declaration.</SUBJECT>
                            <SECTNO>218.204</SECTNO>
                            <SUBJECT>Humanitarian or peacekeeping operation.</SUBJECT>
                            <SECTNO>218.270</SECTNO>
                            <SUBJECT>Head of contracting activity determinations.</SUBJECT>
                            <SECTNO>218.271</SECTNO>
                            <SUBJECT>Use of electronic business tools.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>72 FR 2632, Jan. 22, 2007, unless otherwise noted.</P>
                    </SOURCE>
                    <SUBPART>
                        <PRTPAGE P="158"/>
                        <HD SOURCE="HED">Subpart 218.1—Available Acquisition Flexibilities</HD>
                        <SECTION>
                            <SECTNO>218.170</SECTNO>
                            <SUBJECT>Additional acquisition flexibilities.</SUBJECT>
                            <P>Additional acquisition flexibilities available to DoD are as follows:</P>
                            <P>
                                (a) 
                                <E T="03">Circumstances permitting other than full and open competition.</E>
                                 Use of the authority at FAR 6.302-2, Unusual and compelling urgency, may be appropriate under certain circumstances. See PGI 206.302-2.
                            </P>
                            <P>
                                (b) 
                                <E T="03">Use of advance Military Interdepartmental Purchase Request (MIPR).</E>
                                 For urgent requirements, the advance MIPR may be transmitted electronically. See PGI 208.7004-3.
                            </P>
                            <P>
                                (c) 
                                <E T="03">Use of the Governmentwide commercial purchase card.</E>
                                 Governmentwide commercial purchase cards do not have to be used for purchases valued at or below the micro-purchase threshold if the place of performance is entirely outside the United States. See 213.270(c)(1).
                            </P>
                            <P>
                                (d) 
                                <E T="03">Master agreement for repair and alteration of vessels.</E>
                                 The contracting officer, without soliciting offers, may issue a written job order for emergency work to a contractor that has previously executed a master agreement, when delay would endanger a vessel, its cargo or stores, or when military necessity requires immediate work on a vessel. See 217.7103-4, 252.217-7010, and PGI 217.7103-4.
                            </P>
                            <P>
                                (e) 
                                <E T="03">Spare parts breakout program.</E>
                                 An urgent immediate buy need not be delayed if an evaluation of the additional information cannot be completed in time to meet the required delivery date. See PGI 217.7506, paragraph 1-105(e).
                            </P>
                            <P>
                                (f) 
                                <E T="03">Storage and disposal of toxic and hazardous materials.</E>
                                 Under certain emergency situations, exceptions apply with regard to the prohibition on storage or disposal of non-DoD-owned toxic or hazardous materials on DoD installations. See 223.7102(a)(3) and (7).
                            </P>
                            <P>
                                (g) 
                                <E T="03">Authorization Acts, Appropriations Acts, and other statutory restrictions on foreign acquisition.</E>
                                 Acquisitions in the following categories are not subject to the restrictions of 225.7002, Restrictions on food, clothing, fabrics, specialty metals, and hand or measuring tools: (1) Acquisitions at or below the simplified acquisition threshold; (2) Acquisitions outside the United States in support of combat operations; (3) Acquisitions of perishable foods by or for activities located outside the United States for personnel of those activities; (4) Acquisitions of food, specialty metals, or hand or measuring tools in support of contingency operations, or for which the use of other than competitive procedures has been approved on the basis of unusual and compelling urgency in accordance with FAR 6.302-2; (5) Emergency acquisitions by activities located outside the United States for personnel of those activities; and (6) Acquisitions by vessels in foreign waters. See 225.7002-2.
                            </P>
                            <P>
                                (h) 
                                <E T="03">Rights in technical data.</E>
                                 The agency head may notify a person asserting a restriction that urgent or compelling circumstances (e.g., emergency repair or overhaul) do not permit the Government to continue to respect the asserted restriction. See 227.7102-2; 227.7103-5; 227.7103-13; 227.7104; 227.7203-13; 252.227-7013; 252.227-7014; 252.227-7015; 252.227-7018; and 252.227-7037.
                            </P>
                            <P>
                                (i) 
                                <E T="03">Tax exemption in Spain.</E>
                                 If copies of a contract are not available and duty-free import of equipment or materials is urgent, the contracting officer may send the Joint United States Military Group copies of the Letter of Intent or a similar document indicating the pending award. See PGI 229.7001.
                            </P>
                            <P>
                                (j) 
                                <E T="03">Electronic submission and processing of payment requests.</E>
                                 Exceptions to the use of Wide Area WorkFlow are at 232.7002(a).
                            </P>
                            <P>
                                (k) 
                                <E T="03">Mortuary services.</E>
                                 In an epidemic or other emergency, the contracting activity may obtain services beyond the capacity of the contractor's facilities from other sources. See 237.7003(a) and 252.237-7003.
                            </P>
                            <CITA>[72 FR 2632, Jan. 22, 2007, as amended at 77 FR 38733, June 29, 2012; 84 FR 48505, Sept. 13, 2019]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 218.2—Emergency Acquisition Flexibilities</HD>
                        <SECTION>
                            <SECTNO>218.201</SECTNO>
                            <SUBJECT>Contingency operation.</SUBJECT>
                            <P>
                                (1) 
                                <E T="03">Selection, appointment, and termination of appointment.</E>
                                 Contracting officer qualification requirements pertaining to a baccalaureate degree do 
                                <PRTPAGE P="159"/>
                                not apply to DoD employees or members of the armed forces who are in a contingency contracting force. See 201.603-2(2).
                            </P>
                            <P>
                                (2) 
                                <E T="03">Policy for item unique identification.</E>
                                 Contractors will not be required to provide DoD item unique identification if the items, as determined by the head of the contracting activity, are to be used to support a contingency operation. See 211.274-2(b).
                            </P>
                            <P>
                                (3) 
                                <E T="03">Use of the Governmentwide commercial purchase card.</E>
                                 Governmentwide commercial purchase cards do not have to be used for purchases valued at or below the micro-purchase threshold if the purchase or payment is for an overseas transaction by a contracting officer in support of a contingency operation, or for training exercises in preparation for overseas contingency, humanitarian, or peacekeeping operations. See 213.201(g) and 213.270(c)(3) and (5).
                            </P>
                            <P>
                                (4) 
                                <E T="03">Governmentwide commercial purchase card.</E>
                                 A contracting office supporting a contingency operation or a humanitarian or peacekeeping operation may use the Governmentwide commercial purchase card to make a purchase that exceeds the micro-purchase threshold but does not exceed the simplified acquisition threshold if certain conditions are met. See 213.301(3).
                            </P>
                            <P>
                                (5) 
                                <E T="03">Imprest funds and third party drafts.</E>
                                 Imprest funds are authorized for use without further approval for overseas transactions at or below the micro-purchase threshold in support of a contingency operation or a humanitarian or peacekeeping operation. See 213.305-3(d)(iii)(A).
                            </P>
                            <P>
                                (6) 
                                <E T="03">Standard Form (SF) 44, Purchase Order-Invoice-Voucher.</E>
                                 SF 44s may be used for purchases not exceeding the simplified acquisition threshold for overseas transactions by contracting officers in support of a contingency operation or a humanitarian or peacekeeping operation. See 213.306(a)(1)(B).
                            </P>
                            <P>
                                (7) 
                                <E T="03">Only one offer.</E>
                                 The requirements at sections 215.371-2 do not apply to acquisitions, as determined by the head of the contracting activity, in support of a contingency operation. See 215.371-4(a)(2).
                            </P>
                            <P>
                                (8) 
                                <E T="03">Approval of determination and findings for time-and-materials or labor-hour contracts.</E>
                                 The approval requirements in paragraphs (d)(i)(A)(
                                <E T="03">1</E>
                                ) and (
                                <E T="03">2</E>
                                ) of this section do not apply to contracts that, as determined by the head of the contracting activity, support contingency. See 216.601(d)(3).
                            </P>
                            <P>
                                (9) 
                                <E T="03">Undefinitized contract actions.</E>
                                 The head of the agency may waive certain limitations for undefinitized contract actions if the head of the agency determines that the waiver is necessary to support a contingency operation or a humanitarian or peacekeeping operation. See 217.7404-5(b).
                            </P>
                            <P>
                                (10) 
                                <E T="03">Prohibited sources.</E>
                                 DoD personnel are authorized to make emergency acquisitions in direct support of U.S. or allied forces deployed in military contingency, humanitarian, or peacekeeping operations in a country or region subject to economic sanctions administered by the Department of the Treasury, Office of Foreign Assets Control. See 225.701-70.
                            </P>
                            <P>
                                (11) 
                                <E T="03">Authorization Acts, Appropriations Acts, and other statutory restrictions on foreign acquisition.</E>
                                 Acquisitions in the following categories are not subject to the restrictions of 225.7002, Restrictions on food, clothing, fabrics, specialty metals, and hand or measuring tools: (1) Acquisitions at or below the simplified acquisition threshold; (2) Acquisitions outside the United States in support of combat operations; (3) Acquisitions of perishable foods by or for activities located outside the United States for personnel of those activities; (4) Acquisitions of food, specialty metals, or hand or measuring tools in support of contingency operations, or for which the use of other than competitive procedures has been approved on the basis of unusual and compelling urgency in accordance with FAR 6.302-2; (5) Emergency acquisitions by activities located outside the United States for personnel of those activities; and (6) Acquisitions by vessels in foreign waters. See 225.7002-2.
                            </P>
                            <P>
                                (12) 
                                <E T="03">Electronic submission and processing of payment requests.</E>
                                 Contractors do not have to submit payment requests in electronic form for contracts 
                                <PRTPAGE P="160"/>
                                awarded by deployed contracting officers in the course of military operations, including contingency operations or humanitarian or peacekeeping operations. See 232.7002(a)(4).
                            </P>
                            <CITA>[72 FR 2632, Jan. 22, 2007, as amended at 78 FR 76072, Dec. 16, 2013; 81 FR 53045, Aug. 11, 2016; 83 FR 24890, May 30, 2018; 85 FR 34528, June 5, 2020]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>218.202</SECTNO>
                            <SUBJECT>Defense or recovery from certain events.</SUBJECT>
                            <P>For acquisitions that, as determined by the head of the contracting activity, are to facilitate defense against or recovery from cyber, nuclear, biological, chemical, or radiological attack; to facilitate provision of international disaster assistance; or to support response to an emergency or major disaster, the following requirements do not apply:</P>
                            <P>
                                (1) 
                                <E T="03">Policy for unique item identification at 211.274-2(a).</E>
                                 Contractors are not required to provide DoD unique item identification if the items are to be used to facilitate defense against or recovery from nuclear, biological, chemical, or radiological attack. However, contractors are not exempt from this requirement if the items are to be used to facilitate defense against or recovery from cyber attack. See 211.274-2(b).
                            </P>
                            <P>
                                (2) 
                                <E T="03">Only one offer requirements at section</E>
                                 215.371-2. See 215.371-4(a)(2).
                            </P>
                            <P>
                                (3) 
                                <E T="03">Approval of determination and findings for time-and-materials or labor-hour contracts at 216.601(d)(i)(A)(1) and (2).</E>
                                 See 216.601(d)(3).
                            </P>
                            <CITA>[83 FR 24890, May 30, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>218.203</SECTNO>
                            <SUBJECT>Emergency declaration or major disaster declaration.</SUBJECT>
                            <P>
                                (1) 
                                <E T="03">Establishing or maintaining alternative sources.</E>
                                 PGI contains a sample format for Determination and Findings citing the authority of FAR 6.202(a), regarding exclusion of a particular source in order to establish or maintain an alternative source or sources. Alternate 2 of the sample format addresses having a supplier available for furnishing supplies or services in case of a national emergency. See PGI 206.202.
                            </P>
                            <P>
                                (2) 
                                <E T="03">Electronic submission and processing of payment requests.</E>
                                 Contractors do not have to submit payment requests in electronic form for contracts awarded by contracting officers in the conduct of emergency operations, such as responses to natural disasters or national or civil emergencies. See 232.7002(a)(4).
                            </P>
                            <CITA>[72 FR 2632, Jan. 22, 2007, as amended at 86 FR 59870, Oct. 29, 2021]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>218.204</SECTNO>
                            <SUBJECT>Humanitarian or peacekeeping operation.</SUBJECT>
                            <P>The following requirements do not apply to acquisitions that, as determined by the head of the contracting activity, are in support of humanitarian or peacekeeping operations:</P>
                            <P>
                                (1) 
                                <E T="03">Policy for item unique identification at 211.274-2(a).</E>
                                 See 211.274-2(b).
                            </P>
                            <P>
                                (2) 
                                <E T="03">Only one offer requirements at sections</E>
                                 215.371-2. See 215.371-4(a)(2).
                            </P>
                            <P>
                                (3) 
                                <E T="03">Approval of determination and findings for time-and-materials or labor-hour contracts at 216.601(d)(i)(A)(1) and (2).</E>
                                 See 216.601(d)(3).
                            </P>
                            <CITA>[83 FR 24890, May 30, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>218.270</SECTNO>
                            <SUBJECT>Head of contracting activity determinations.</SUBJECT>
                            <P>The term “head of the agency” is replaced with “head of the contracting activity,” as defined in FAR 2.101, in the following locations:</P>
                            <P>(a) FAR 2.101: definition of “simplified acquisition threshold.”</P>
                            <P>(b) FAR 12.102(f).</P>
                            <P>(c) FAR 13.201(g).</P>
                            <P>(d) FAR 13.500(c)(1).</P>
                            <P>(e) FAR 18.2.</P>
                            <CITA>[74 FR 2407, Jan. 15, 2009. Redesignated at 76 FR 44281, July 25, 2011; 82 FR 61480, Dec. 28, 2017. Redesignated and amended at 83 FR 24890, May 30, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>218.271</SECTNO>
                            <SUBJECT>Use of electronic business tools.</SUBJECT>
                            <P>When supporting a contingency operation or humanitarian or peacekeeping operation, follow the procedures at PGI 218.271 concerning the use of electronic business tools.</P>
                            <CITA>[80 FR 10390, Feb. 26, 2015. Redesignated and amended at 83 FR 24890, May 30, 2018]</CITA>
                        </SECTION>
                    </SUBPART>
                </PART>
            </SUBCHAP>
            <SUBCHAP TYPE="P">
                <PRTPAGE P="161"/>
                <HD SOURCE="HED">SUBCHAPTER D—SOCIOECONOMIC PROGRAMS</HD>
                <PART>
                    <EAR>Pt. 219</EAR>
                    <HD SOURCE="HED">PART 219—SMALL BUSINESS PROGRAMS</HD>
                    <CONTENTS>
                        <SECHD>Sec.</SECHD>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 219.2—Policies</HD>
                            <SECTNO>219.201</SECTNO>
                            <SUBJECT>General policy.</SUBJECT>
                            <SECTNO>219.202</SECTNO>
                            <SUBJECT>Specific policies.</SUBJECT>
                            <SECTNO>219.202-1</SECTNO>
                            <SUBJECT>Encouraging small business participation in acquisitions.</SUBJECT>
                            <SECTNO>219.270</SECTNO>
                            <SUBJECT>Religious-related services—inclusion of nonprofit organizations.</SUBJECT>
                            <SECTNO>219.270-1</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <SECTNO>219.270-2</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>219.270-3</SECTNO>
                            <SUBJECT>Solicitation provision.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 219.3—Determination of Small Business Status for Small Business Programs</HD>
                            <SECTNO>219.301-2</SECTNO>
                            <SUBJECT>Rerepresentation by a contractor that represented itself as a small business concern.</SUBJECT>
                            <SECTNO>219.301-3</SECTNO>
                            <SUBJECT>Rerepresentation by a contractor that represented itself as other than a small business concern.</SUBJECT>
                            <SECTNO>219.309</SECTNO>
                            <SUBJECT>Solicitation provisions and contract clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 219.4—Cooperation With the Small Business Administration</HD>
                            <SECTNO>219.401</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>219.402</SECTNO>
                            <SUBJECT>Small Business Administration procurement center representatives.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 219.5—Small Business Total Set-Asides, Partial Set-Asides, and Reserves</HD>
                            <SECTNO>219.502</SECTNO>
                            <SUBJECT>Setting aside acquisitions.</SUBJECT>
                            <SECTNO>219.502-1</SECTNO>
                            <SUBJECT>Requirements for setting aside acquisitions.</SUBJECT>
                            <SECTNO>219.502-2</SECTNO>
                            <SUBJECT>Total small business set-asides.</SUBJECT>
                            <SECTNO>219.502-8</SECTNO>
                            <SUBJECT>Rejecting Small Business Administration recommendations.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 219.6—Certificates of Competency and Determinations of Responsibility</HD>
                            <SECTNO>219.602</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 219.7—The Small Business Subcontracting Program</HD>
                            <SECTNO>219.702-70</SECTNO>
                            <SUBJECT>Statutory requirements for the Test Program for Negotiation of Comprehensive Small Business Subcontracting Plans.</SUBJECT>
                            <SECTNO>219.703</SECTNO>
                            <SUBJECT>Eligibility requirements for participating in the program.</SUBJECT>
                            <SECTNO>219.704</SECTNO>
                            <SUBJECT>Subcontracting plan requirements.</SUBJECT>
                            <SECTNO>219.705</SECTNO>
                            <SUBJECT>Responsibilities of the contracting officer under the subcontracting assistance program.</SUBJECT>
                            <SECTNO>219.705-4</SECTNO>
                            <SUBJECT>Reviewing the subcontracting plan.</SUBJECT>
                            <SECTNO>219.705-6</SECTNO>
                            <SUBJECT>Postaward responsibilities of the contracting officer.</SUBJECT>
                            <SECTNO>219.706</SECTNO>
                            <SUBJECT>Responsibilities of the cognizant administrative contracting officer.</SUBJECT>
                            <SECTNO>219.708</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 219.8—Contracting With the Small Business Administration (The 8(a) Program)</HD>
                            <SECTNO>219.800</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>219.803</SECTNO>
                            <SUBJECT>Selecting acquisitions for the 8(a) Program.</SUBJECT>
                            <SECTNO>219.804</SECTNO>
                            <SUBJECT>Evaluation, offering, and acceptance.</SUBJECT>
                            <SECTNO>219.804-1</SECTNO>
                            <SUBJECT>Agency evaluation.</SUBJECT>
                            <SECTNO>219.805</SECTNO>
                            <SUBJECT>Competitive 8(a).</SUBJECT>
                            <SECTNO>219.805-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>219.805-2</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>219.806</SECTNO>
                            <SUBJECT>Pricing the 8(a) contract.</SUBJECT>
                            <SECTNO>219.808</SECTNO>
                            <SUBJECT>Contract negotiation.</SUBJECT>
                            <SECTNO>219.808-1</SECTNO>
                            <SUBJECT>Sole source.</SUBJECT>
                            <SECTNO>219.811</SECTNO>
                            <SUBJECT>Preparing the contracts.</SUBJECT>
                            <SECTNO>219.811-3</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 219.13—Historically Underutilized Business Zone (HUBZone) Program</HD>
                            <SECTNO>219.1307</SECTNO>
                            <SUBJECT>Price evaluation preference for HUBZone small business concerns.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <RESERVED>Subpart 219.70 [Reserved]</RESERVED>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 219.71—DoD Mentor Protégé Program</HD>
                            <SECTNO>219.7100</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>219.7101</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>219.7102</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>219.7103</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>219.7103-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>219.7103-2</SECTNO>
                            <SUBJECT>Contracting officer responsibilities.</SUBJECT>
                            <SECTNO>219.7104</SECTNO>
                            <SUBJECT>Developmental assistance costs eligible for reimbursement or credit.</SUBJECT>
                            <SECTNO>219.7105</SECTNO>
                            <SUBJECT>Reporting.</SUBJECT>
                            <SECTNO>219.7106</SECTNO>
                            <SUBJECT>Performance reviews.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36353, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 219.2—Policies</HD>
                        <SECTION>
                            <SECTNO>219.201</SECTNO>
                            <SUBJECT>General policy.</SUBJECT>
                            <P>
                                (c) For the defense agencies, the director of the Office of Small Business 
                                <PRTPAGE P="162"/>
                                Programs must be appointed by, be responsible to, and report directly to the director or deputy director of the defense agency.
                            </P>
                            <P>(8) The responsibility for assigning small business technical advisors is delegated to the head of the contracting activity.</P>
                            <P>(10) Contracting activity small business specialists perform this function by—</P>
                            <P>(A) Reviewing and making recommendations for all acquisitions (including orders placed against Federal Supply Schedule contracts) over the micro-purchase threshold (see FAR 19.502-2(a)), except those under the simplified acquisition threshold that are totally set aside for small business concerns in accordance with FAR 19.502-2. Follow the procedures at PGI 219.201(c)(10) regarding such reviews.</P>
                            <P>(B) Making the review before issuance of the solicitation or contract modification and documenting it on DD Form 2579, Small Business Coordination Record (see PGI 253.219-70 for instructions on completing the form); and</P>
                            <P>(C) Referring recommendations that have been rejected by the contracting officer to the Small Business Administration (SBA) procurement center representative. If an SBA procurement center representative is not assigned, see FAR 19.402(a).</P>
                            <P>(11) Also conduct annual reviews to assess—</P>
                            <P>(A) The extent of consolidation of contract requirements that has occurred (see FAR 7.107); and</P>
                            <P>(B) The impact of those consolidations on the availability of small business concerns to participate in procurements as both contractors and subcontractors.</P>
                            <P>(d) For information on the appointment and functions of small business specialists, see PGI 219.201(d).</P>
                            <CITA>[56 FR 36353, July 31, 1991, as amended at 63 FR 41973, Aug. 6, 1998; 64 FR 2598, Jan. 15, 1999; 65 FR 39705, June 27, 2000; 65 FR 50149, Aug. 17, 2000; 65 FR 63807, Oct. 25, 2000; 69 FR 55987, Sept. 17, 2004; 71 FR 44927, Aug. 8, 2006; 73 FR 46813, Aug. 12, 2008; 75 FR 45074, Aug. 2, 2010; 79 FR 61582, Oct. 14, 2014; 79 FR 67356, Nov. 13, 2014; 79 FR 68635, Nov. 18, 2014; 80 FR 56930, Sept. 21, 2015; 83 FR 15996, Apr. 13, 2018; 87 FR 31962, May 26, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.202</SECTNO>
                            <SUBJECT>Specific policies.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.202-1</SECTNO>
                            <SUBJECT>Encouraging small business participation in acquisitions.</SUBJECT>
                            <P>See PGI 205.207(d) for information on how to advertise a small business event on the Government point of entry.</P>
                            <CITA>[76 FR 76319, Dec. 7, 2011, as amended at 77 FR 76937, Dec. 31, 2012; 79 FR 61582, Oct. 14, 2014]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.270</SECTNO>
                            <SUBJECT>Religious-related services—inclusion of nonprofit organizations.</SUBJECT>
                        </SECTION>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>83 FR 16002, Apr. 13, 2018, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>219.270-1</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <P>As used in this section—</P>
                            <P>
                                <E T="03">Nonprofit organization</E>
                                 means any organization that is—
                            </P>
                            <P>(1) Described in section 501(c) of the Internal Revenue Code of 1986; and</P>
                            <P>(2) Exempt from tax under section 501(a) of that Code.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.270-2</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>(a) To comply with section 898 of the National Defense Authorization Act for Fiscal Year 2016 (Pub. L. 114-92), when acquiring religious-related services to be performed on a U.S. military installation—</P>
                            <P>(1) Do not preclude a nonprofit organization from competing, even when the acquisition is set aside for small businesses as identified in FAR 19.000(a)(3); and</P>
                            <P>(2) Do not use any of the sole source exceptions at FAR 6.302-5(b)(4) through (7) for such acquisitions.</P>
                            <P>(b) If the apparently successful offeror has not represented in its quotation or offer that it is one of the small business concerns identified in FAR 19.000(a)(3), the contracting officer shall verify that the offeror is registered in the System for Award Management database as a nonprofit organization.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.270-3</SECTNO>
                            <SUBJECT>Solicitation provision.</SUBJECT>
                            <P>
                                Use the provision 252.219-7012, Competition for Religious-Related Services, in solicitations, including solicitations using FAR part 12 procedures for the acquisition of commercial services, for the acquisition of religious-related 
                                <PRTPAGE P="163"/>
                                services to be performed on U.S. military installations, when the acquisition is set aside for any of the small business concerns identified in FAR 19.000(a)(3).
                            </P>
                            <CITA>[83 FR 16002, Apr. 13, 2018, as amended at 88 FR 6583, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 219.3—Determination of Small Business Status for Small Business Programs</HD>
                        <SECTION>
                            <SECTNO>219.301-2</SECTNO>
                            <SUBJECT>Rerepresentation by a contractor that represented itself as a small business concern.</SUBJECT>
                            <P>Follow the procedures at PGI 204.606(4)(vii) for reporting modifications for rerepresentation actions.</P>
                            <CITA>[76 FR 76320, Dec. 7, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.301-3</SECTNO>
                            <SUBJECT>Rerepresentation by a contractor that represented itself as other than a small business concern.</SUBJECT>
                            <P>Follow the procedures at PGI 204.606(4)(vii) for reporting modifications for rerepresentation actions.</P>
                            <CITA>[76 FR 76320, Dec. 7, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.309</SECTNO>
                            <SUBJECT>Solicitation provisions and contract clauses.</SUBJECT>
                            <P>(1) Use the provision at 252.219-7000, Advancing Small Business Growth, in solicitations, including solicitations using FAR part 12 procedures for acquisition of commercial products and commercial services, when the estimated annual value of the contract is expected to exceed—</P>
                            <P>(i) The small business size standard, if expressed in dollars, for the North American Industry Classification System (NAICS) code assigned by the contracting officer; or</P>
                            <P>(ii) $70 million, if the small business size standard is expressed as number of employees for the NAICS code assigned by the contracting officer.</P>
                            <CITA>[80 FR 30116, May 26, 2015, as amended at 88 FR 6583, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 219.4—Cooperation With the Small Business Administration</HD>
                        <SECTION>
                            <SECTNO>219.401</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>(b) The contracting activity small business specialist is the primary activity focal point for interface with the SBA.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.402</SECTNO>
                            <SUBJECT>Small Business Administration procurement center representatives.</SUBJECT>
                            <P>
                                (c)(i) 
                                <E T="03">Authority.</E>
                                 This section implements section 1811 of the National Defense Authorization Act for Fiscal Year 2017 (Pub. L. 114-328).
                            </P>
                            <P>
                                (ii) 
                                <E T="03">Definition.</E>
                                 As used in this section—
                            </P>
                            <P>
                                <E T="03">Humanitarian and civic assistance</E>
                                 means any of the following activities carried out in conjunction with authorized military operations in a foreign country:
                            </P>
                            <P>(A) Medical, surgical, dental, and veterinary care provided in areas of a country that are rural or underserved by professionals in those fields, including education, training, and technical assistance related to the care provided.</P>
                            <P>(B) Construction of rudimentary surface transportation systems.</P>
                            <P>(C) Well drilling and construction of basic sanitation facilities.</P>
                            <P>(D) Rudimentary construction and repair of public facilities. (10 U.S.C. 401(e))</P>
                            <P>
                                (iii) 
                                <E T="03">Exclusions.</E>
                                 Unless the contracting activity requests a review, SBA procurement center representatives will not review acquisitions conducted by or for DoD if the acquisition is—
                            </P>
                            <P>(A) For foreign military sales (see 225.7300);</P>
                            <P>(B) In support of humanitarian and civic assistance;</P>
                            <P>(C) In support of a contingency operation;</P>
                            <P>(D) Awarded pursuant to a Status of Forces Agreement or other agreement with the government of a foreign country in which U.S. Armed Forces are deployed; or</P>
                            <P>(E) Both awarded and performed outside the United States and its outlying areas.</P>
                            <CITA>[84 FR 72562, Dec. 31, 2019]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <PRTPAGE P="164"/>
                        <HD SOURCE="HED">Subpart 219.5—Small Business Total Set-Asides, Partial Set-Asides, and Reserves</HD>
                        <SECTION>
                            <SECTNO>219.502</SECTNO>
                            <SUBJECT>Setting aside acquisitions.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.502-1</SECTNO>
                            <SUBJECT>Requirements for setting aside acquisitions.</SUBJECT>
                            <P>Do not set aside acquisitions—</P>
                            <P>(1) For supplies that were developed and financed, in whole or in part, by Canadian sources under the U.S.-Canadian Defense Development Sharing Program; or</P>
                            <P>(2) Excluded from procurement center representative review (see 219.402(c)(iii)).</P>
                            <CITA>[84 FR 72563, Dec. 31, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.502-2</SECTNO>
                            <SUBJECT>Total small business set-asides.</SUBJECT>
                            <P>Unless the contracting officer determines that the criteria for set-aside cannot be met, set aside for small business concerns acquisitions for—</P>
                            <P>(1) Construction, including maintenance and repairs, under $3 million;</P>
                            <P>(2) Dredging under $1.5 million; and</P>
                            <P>(3) Architect-engineer services for military construction or family housing projects under $1 million (10 U.S.C. 2855).</P>
                            <CITA>[85 FR 53683, Aug. 31, 2020, as amended at 85 FR 61504, Sept. 29, 2020]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.502-8</SECTNO>
                            <SUBJECT>Rejecting Small Business Administration recommendations.</SUBJECT>
                            <P>(b) The designee shall be at a level no lower than chief of the contracting office.</P>
                            <CITA>[56 FR 36353, July 31, 1991. Redesignated at 85 FR 53683, Aug. 31, 2020]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 219.6—Certificates of Competency and Determinations of Responsibility</HD>
                        <SECTION>
                            <SECTNO>219.602</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>When making a nonresponsibility determination for a small business concern, follow the procedures at PGI 219.602.</P>
                            <CITA>[72 FR 20762, Apr. 26, 2007]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 219.7—The Small Business Subcontracting Program</HD>
                        <SECTION>
                            <SECTNO>219.702-70</SECTNO>
                            <SUBJECT>Statutory requirements for the Test Program for Negotiation of Comprehensive Small Business Subcontracting Plans.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Test Program.</E>
                                 In accordance with 15 U.S.C. 637 note, DoD has established a test program to determine whether comprehensive subcontracting plans on a corporate, division, or plant-wide basis will reduce administrative burdens while enhancing subcontracting opportunities for small and small disadvantaged business concerns. This program is referred to as the Test Program for Negotiation of Comprehensive Small Business Subcontracting Plans (Test Program).
                            </P>
                            <P>
                                (b) 
                                <E T="03">Eligibility requirements.</E>
                                 To become and remain eligible to participate in the Test Program, a business concern is required to have furnished supplies or services (including construction) under at least three DoD contracts during the preceding fiscal year, having an aggregate value of at least $100 million.
                            </P>
                            <P>
                                (c) 
                                <E T="03">Comprehensive subcontracting plans.</E>
                                 (1) The Defense Contract Management Agency will designate the contracting officer who shall negotiate and approve comprehensive subcontracting plans with eligible participants on an annual basis.
                            </P>
                            <P>(2) Test Program participants use their comprehensive subcontracting plans, in lieu of individual subcontracting plans, when performing any DoD contract or subcontract that requires a subcontracting plan.</P>
                            <P>
                                (d) 
                                <E T="03">Assessment.</E>
                                 The contracting officer designated to manage the comprehensive subcontracting plan shall conduct a compliance review during the fiscal year after the close of the fiscal year for which the plan is applicable. The contracting officer shall compare the approved percentage or dollar goals to the total, actual subcontracting dollars covered by the comprehensive subcontracting plan.
                            </P>
                            <P>
                                (1) If the contractor has failed to meet its approved subcontracting goal(s), the contracting officer shall give the contractor written notice specifying the failure, advising of the potential for assessment of liquidated damages, permitting the contractor to 
                                <PRTPAGE P="165"/>
                                demonstrate what good faith efforts have been made, and providing a period of 15 working days (or longer period at the contracting officer's discretion) within which to respond. The contracting officer may take the contractor's failure to respond to the notice as an admission that no valid explanation exists.
                            </P>
                            <P>(2) The contracting officer shall review all available information to determine whether the contractor has failed to make a good faith effort to comply with the plan.</P>
                            <P>(3) If, after consideration of all relevant information, the contracting officer determines that the contractor failed to make a good faith effort to comply with the comprehensive subcontracting plan, the contracting officer shall issue a final decision. The contracting officer's final decision shall include the right of the contractor to appeal under the Disputes clause. The contracting officer shall distribute a copy of the final decision to all cognizant contracting officers for the contracts covered under the plan.</P>
                            <P>
                                (e) 
                                <E T="03">Liquidated damages.</E>
                                 The amount of liquidated damages shall be the amount of anticipated damages sustained by the Government, including but not limited to additional expenses of administration, reporting, and contract monitoring, and shall be identified in the comprehensive subcontracting plan. Liquidated damages shall be in addition to any other remedies the Government may have.
                            </P>
                            <P>
                                (f) 
                                <E T="03">Expiration date.</E>
                                 The Test Program expires on December 31, 2017.
                            </P>
                            <CITA>[83 FR 15998, Apr. 13, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.703</SECTNO>
                            <SUBJECT>Eligibility requirements for participating in the program.</SUBJECT>
                            <P>(a) Qualified nonprofit agencies for the blind and other severely disabled, that have been approved by the Committee for Purchase from People Who Are Blind or Severely Disabled under 41 U.S.C. chapter 85, are eligible to participate in the program as a result of 10 U.S.C. 3903 and section 9077 of Public Law  102-396 and similar sections in subsequent Defense appropriations acts. Under this authority, subcontracts awarded to such entities may be counted toward the prime contractor's small business subcontracting goal.</P>
                            <P>(b) A contractor may also rely on the written representation as to status of—</P>
                            <P>(i) A historically black college or university or minority institution; or</P>
                            <P>(ii) A qualified nonprofit agency for the blind or other severely disabled approved by the Committee for Purchase from People Who Are Blind or Severely Disabled.</P>
                            <CITA>[57 FR 42630, Sept. 15, 1992, as amended at 58 FR 28465, May 13, 1993; 60 FR 13075, Mar. 10, 1995; 60 FR 41157, Aug. 11, 1995; 60 FR 61596, Nov. 30, 1995; 61 FR 50535, Sept. 26, 1996; 63 FR 11530, Mar. 9, 1998; 63 FR 41974, Aug. 6, 1998; 64 FR 51076, Sept. 21, 1999; 64 FR 62986, Nov. 18, 1999; 72 FR 20762, Apr. 26, 2007; 76 FR 58137, Sept. 20, 2011; 77 FR 35880, June 15, 2012; 79 FR 61582, Oct. 14, 2014; 87 FR 76993, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.704</SECTNO>
                            <SUBJECT>Subcontracting plan requirements.</SUBJECT>
                            <P>(1) In those subcontracting plans which specifically identify small businesses, prime contractors shall notify the administrative contracting officer of any substitutions of firms that are not small business firms, for the small business firms specifically identified in the subcontracting plan. Notifications shall be in writing and shall occur within a reasonable period of time after award of the subcontract. Contractor-specified formats shall be acceptable.</P>
                            <P>(2) See 215.304 for evaluation of offers in acquisitions that require a subcontracting plan.</P>
                            <CITA>[72 FR 20762, Apr. 26, 2007, as amended at 79 FR 61582, Oct. 14, 2014]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.705</SECTNO>
                            <SUBJECT>Responsibilities of the contracting officer under the subcontracting assistance program.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.705-4</SECTNO>
                            <SUBJECT>Reviewing the subcontracting plan.</SUBJECT>
                            <P>(d)(i) Challenge any subcontracting plan that does not contain positive goals. A small disadvantaged business goal of less than five percent must be approved one level above the contracting officer.</P>
                            <P>(ii) The contracting officer may use the checklist at PGI 219.705-4 when reviewing subcontracting plans in accordance with FAR 19.705-4.</P>
                            <CITA>[82 FR 61480, Dec. 28, 2017]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="166"/>
                            <SECTNO>219.705-6</SECTNO>
                            <SUBJECT>Postaward responsibilities of the contracting officer.</SUBJECT>
                            <P>(f) See PGI 219.705-6(f) for guidance on reviewing subcontracting reports.</P>
                            <CITA>[82 FR 61480, Dec. 28, 2017]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.706</SECTNO>
                            <SUBJECT>Responsibilities of the cognizant administrative contracting officer.</SUBJECT>
                            <P>(a)(i) The contract administration office also is responsible for reviewing, evaluating, and approving master subcontracting plans.</P>
                            <P>(ii) The small business specialist supports the administrative contracting officer in evaluating a contractor's performance and compliance with its subcontracting plan.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.708</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>(b)(1)(A) Use the basic, alternate I, or alternate II clause at 252.219-7003, Small Business Subcontracting Plan (DoD Contracts), in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, that contain the clause at FAR 52.219-9, Small Business Subcontracting Plan.</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Use the basic clause at 252.219-7003, when using the basic, alternate I, or alternate II of FAR 52.219-9.
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Use the alternate I clause at 252.219-7003, when using Alternate III of FAR 52.219-9.
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) Use the alternate II clause at 252.219-7003 when using the Demonstration Project described at 226.72.
                            </P>
                            <P>(B) In contracts with contractors that have comprehensive subcontracting plans approved under the Test Program described in 219.702-70, including contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, use the clause at 252.219-7004, Small Business Subcontracting Plan (Test Program), instead of the clauses at 252.219-7003, Small Business Subcontracting Plan (DoD Contracts), FAR 52.219-9, Small Business Subcontracting Plan, and FAR 52.219-16, Liquidated Damages—Subcontracting Plan.</P>
                            <P>(2) In contracts with contractors that have comprehensive subcontracting plans approved under the Test Program described in 219.702-70, do not use the clause at FAR 52.219-16, Liquidated Damages—Subcontracting Plan.</P>
                            <P>(c)(1) Do not use the clause at FAR 52.219-10, Incentive Subcontracting Program, in contracts with contractors that have comprehensive subcontracting plans approved under the Test Program described in 219.702-70.</P>
                            <CITA>[78 FR 37986, June 25, 2013, as amended at 81 FR 17046, Mar. 25, 2016; 83 FR 15999, Apr. 13, 2018; 84 FR 72560, Dec. 31, 2019; 88 FR 6583, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 219.8—Contracting With the Small Business Administration (The 8(a) Program)</HD>
                        <SECTION>
                            <SECTNO>219.800</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>(a) By Partnership Agreement (PA) between the Small Business Administration (SBA) and the Department of Defense (DoD), the SBA has delegated to the Under Secretary of Defense (Acquisition and Sustainment) its authority under paragraph 8(a)(1)(A) of the Small Business Act (15 U.S.C. 637(a)) to enter into 8(a) prime contracts, and its authority under 8(a)(1)(B) of the Small Business Act to award the performance of those contracts to eligible 8(a) Program participants. However, the SBA remains the prime contractor on all 8(a) contracts, continues to determine eligibility of concerns for contract award, and retains appeal rights under FAR 19.810. The SBA delegates only the authority to sign contracts on its behalf. Consistent with the provisions of the PA, this authority is hereby redelegated to DoD contracting officers. A copy of the PA, which includes the PA's expiration date, is available at PGI 219.800.</P>
                            <P>(b) Contracts awarded under the PA may be awarded directly to the 8(a) participant on either a sole source or competitive basis. An SBA signature on the contract is not required.</P>
                            <P>(c) Notwithstanding the PA, the contracting officer may elect to award a contract pursuant to the provisions of FAR Subpart 19.8.</P>
                            <CITA>[67 FR 11436, Mar. 14, 2002, as amended at 72 FR 20762, Apr. 26, 2007; 88 FR 73236, Oct. 25, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="167"/>
                            <SECTNO>219.803</SECTNO>
                            <SUBJECT>Selecting acquisitions for the 8(a) Program.</SUBJECT>
                            <P>When selecting acquisitions for the 8(a) Program, follow the procedures at PGI 219.803.</P>
                            <CITA>[72 FR 20762, Apr. 26, 2007]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.804</SECTNO>
                            <SUBJECT>Evaluation, offering, and acceptance.</SUBJECT>
                            <P>When processing requirements under the PA, follow the procedures at PGI 219.804.</P>
                            <CITA>[72 FR 20762, Apr. 26, 2007]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.804-1</SECTNO>
                            <SUBJECT>Agency evaluation.</SUBJECT>
                            <P>(f) The 8(a) firms should be offered the opportunity to give a technical presentation.</P>
                            <CITA>[63 FR 41974, Aug. 6, 1998]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.805</SECTNO>
                            <SUBJECT>Competitive 8(a).</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.805-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>(b)(2)(A) For acquisitions that exceed the competitive threshold, the SBA also may accept the requirement for a sole source 8(a) award on behalf of a small business concern owned by a Native Hawaiian Organization (Section 8020 of Pub. L. 109-148).</P>
                            <P>
                                (B) 
                                <E T="03">Native Hawaiian Organization</E>
                                , as used in this subsection and as defined by 15 U.S.C. 637(a)(15) and 13 CFR 124.3, means any community service organization serving Native Hawaiians in the State of Hawaii—
                            </P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) That is a not-for-profit organization chartered by the State of Hawaii;
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) That is controlled by Native Hawaiians; and
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) Whose business activities will principally benefit such Native Hawaiians.
                            </P>
                            <CITA>[70 FR 43073, July 26, 2005, as amended at 71 FR 34832, June 16, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.805-2</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>When processing requirements under the PA, follow the procedures at PGI 219.805-2 for requesting eligibility determinations.</P>
                            <CITA>[72 FR 20762, Apr. 26, 2007]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.806</SECTNO>
                            <SUBJECT>Pricing the 8(a) contract.</SUBJECT>
                            <P>For requirements processed under the PA cited in 219.800—</P>
                            <P>(1) The contracting officer shall obtain certified cost or pricing data from the 8(a) contractor, if required by FAR subpart 15.4; and</P>
                            <P>(2) SBA concurrence in the negotiated price is not required. However, except for purchase orders not exceeding the simplified acquisition threshold, the contracting officer shall notify the SBA prior to withdrawing a requirement from the 8(a) Program due to failure to agree on price or other terms and conditions.</P>
                            <CITA>[63 FR 33588, June 19, 1998, as amended at 67 FR 11437, Mar. 14, 2002; 67 FR 49256, July 30, 2002; 77 FR 76940, Dec. 31, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.808</SECTNO>
                            <SUBJECT>Contract negotiation.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.808-1</SECTNO>
                            <SUBJECT>Sole source.</SUBJECT>
                            <P>For sole source requirements processed under the PA, follow the procedures at PGI 219.808-1.</P>
                            <P>(a) In lieu of the threshold at FAR 19.808-1(a), the SBA may not accept for negotiation a DoD sole-source 8(a) contract exceeding $100 million unless DoD has completed a justification in accordance with FAR 6.303 and 206.303-1(b).</P>
                            <CITA>[72 FR 20762, Apr. 26, 2007, as amended at 85 FR 34530, June 5, 2020]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.811</SECTNO>
                            <SUBJECT>Preparing the contracts.</SUBJECT>
                            <P>When preparing awards under the PA, follow the procedures at PGI 219.811.</P>
                            <CITA>[72 FR 20762, Apr. 26, 2007]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.811-3</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>(1) Use the clause at 252.219-7009, Section 8(a) Direct Award, instead of the clauses at FAR 52.219-11, Special 8(a) Contract Conditions, FAR 52.219-12, Special 8(a) Subcontract Conditions, and FAR 52.219-17, Section 8(a) Award, in solicitations and contracts processed in accordance with the PA cited in 219.800.</P>
                            <P>
                                (2) Use the clause at 252.219-7010, Notification of Competition Limited to Eligible 8(a) Participants-Partnership Agreement, in lieu of the clause at FAR 52.219-18, Notification of Competition Limited to Eligible 8(a) Participants, in competitive solicitations and contracts, including solicitations and contracts using FAR part 12 procedures 
                                <PRTPAGE P="168"/>
                                for the acquisition of commercial products and commercial services, when the acquisition is accomplished using the procedures of FAR 19.805 and processed in accordance with the PA cited in 219.800.
                            </P>
                            <P>(3) Use the clause at 252.219-7011, Notification to Delay Performance, in solicitations and purchase orders issued under the PA cited in 219.800.</P>
                            <CITA>[63 FR 33588, June 19, 1998, as amended at 67 FR 11437, Mar. 14, 2002; 72 FR 20762, Apr. 26, 2007; 81 FR 17046, Mar. 25, 2016; 84 FR 58336, Oct. 31, 2019; 88 FR 80465, Nov. 17, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 219.13—Historically Underutilized Business Zone (HUBZone) Program</HD>
                        <SECTION>
                            <SECTNO>219.1307</SECTNO>
                            <SUBJECT>Price evaluation preference for HUBZone small business concerns.</SUBJECT>
                            <P>(a) Also, do not use the price evaluation preference in acquisitions that use tiered evaluation of offers, until a tier is reached that considers offers from other than small business concerns.</P>
                            <CITA>[71 FR 53043, Sept. 8, 2006]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <RESERVED>Subpart 219.70 [Reserved]</RESERVED>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 219.71—DoD Mentor Protégé Program</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>65 FR 6555, Feb. 10, 2000, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>219.7100</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>This subpart implements the DoD Mentor-Protégé Program (referred to as the Program) authorized under 10 U.S.C. 4902. The purpose of the Program is to provide incentives for DoD contractors to assist protégé firms in enhancing their capabilities and to increase participation of such firms in Government and commercial contracts.</P>
                            <CITA>[89 FR 20876, Mar. 26, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.7101</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>DoD policy and procedures for implementation of the Program are contained in appendix I, Policy and Procedures for the DoD Mentor-Protégé Program.</P>
                            <CITA>[65 FR 6555, Feb. 10, 2000, as amended at 87 FR 52349, Aug. 25, 2022; 89 FR 20876, Mar. 26, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.7102</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>The Program includes—</P>
                            <P>(a) Mentor firms and protégé firms that meet the criteria in appendix I, section I-102;</P>
                            <P>(b) Mentor-protégé agreements that establish a developmental assistance program for a protégé firm;</P>
                            <P>(c) A preliminary assessment of the protégé firm's cybersecurity readiness. The DoD Office of Small Business Programs (OSBP), Office of the Under Secretary of Defense, Acquisition and Sustainment (OUSD(A&amp;S)), provides this preliminary assessment, which is a benefit of program participation; and</P>
                            <P>(d) Incentives that DoD may provide to mentor firms, which include—</P>
                            <P>(1) Reimbursement for developmental assistance costs through—</P>
                            <P>(i) A separately priced contract line item on a DoD contract; or</P>
                            <P>(ii) A separate contract, upon written determination by the Director, OSBP, of the cognizant military department or defense agency that unusual circumstances justify reimbursement using a separate contract; or</P>
                            <P>(2) Credit toward applicable subcontracting goals, established under a subcontracting plan negotiated under FAR subpart 19.7 or under the DoD Comprehensive Subcontracting Test Program, for developmental assistance costs that are not reimbursed.</P>
                            <CITA>[65 FR 6555, Feb. 10, 2000; 65 FR 30191, May 10, 2000, as amended at 66 FR 47108, Sept. 11, 2001; 69 FR 74995, Dec. 15, 2004; 70 FR 29645, May 24, 2005; 73 FR 46813, Aug. 12, 2008; 83 FR 12683, Mar. 23, 2018; 87 FR 52349, Aug. 25, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.7103</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.7103-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>
                                The procedures for application, acceptance, and participation in the Program are in appendix I, Policy and Procedures for the DoD Mentor-Protégé Program. The Mentor-Protégé Program Director, OSBP, OUSD(A&amp;S), has the authority to approve contractors as mentor firms. The Director, OSBP, of each military department or defense 
                                <PRTPAGE P="169"/>
                                agency has the authority to approve mentor-protégé agreements and forward approved mentor-protégé agreements to the contracting officer when funding is available.
                            </P>
                            <CITA>[87 FR 52349, Aug. 25, 2022, as amended at 89 FR 20876, Mar. 26, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.7103-2</SECTNO>
                            <SUBJECT>Contracting officer responsibilities.</SUBJECT>
                            <P>Contracting officers shall—</P>
                            <P>(a) Negotiate an advance agreement on the treatment of developmental assistance costs for either credit or reimbursement if the mentor firm proposes such an agreement, or delegate authority to negotiate to the administrative contracting officer (see FAR 31.109).</P>
                            <P>(b) Modify (without consideration) applicable contract(s) to incorporate the clause at 252.232-7005, Reimbursement of Subcontractor Advance Payments—DoD Mentor-Protégé Program, when a mentor firm provides advance payments to a protégé firm under the Program and the mentor firm requests reimbursement of advance payments.</P>
                            <P>(c) Modify (without consideration) applicable contract(s) to incorporate other than customary progress payments for protégé firms in accordance with FAR 32.504(c) if a mentor firm provides such payments to a protégé firm and the mentor firm requests reimbursement.</P>
                            <P>(d) Modify applicable contract(s) to establish a contract line item for reimbursement of developmental assistance costs if—</P>
                            <P>(1) A DoD program manager or the Director, OSBP, of the cognizant military department or defense agency has made funds available for that purpose; and</P>
                            <P>(2) The contractor has an approved mentor-protégé agreement.</P>
                            <P>(e) Negotiate and award a separate contract for reimbursement of developmental assistance costs only if—</P>
                            <P>(1) Funds are available for that purpose;</P>
                            <P>(2) The contractor has an approved mentor-protégé agreement; and</P>
                            <P>(3) The Director, OSBP, of the military department or defense agency has made a determination in accordance with 219.7102(d)(1)(ii).</P>
                            <P>(f) Not authorize reimbursement for costs of assistance furnished to a protégé firm in excess of $1 million in a fiscal year unless a written determination from the Director, OSBP, of the military department or defense agency is obtained.</P>
                            <P>(g) Advise contractors of reporting requirements in appendix I.</P>
                            <P>(h) Provide a copy of the approved mentor-protégé agreement to the Defense Contract Management Agency (DCMA) small business professional responsible for conducting the annual performance review (see appendix I, section I-113).</P>
                            <CITA>[65 FR 6555, Feb. 10, 2000; 65 FR 30191, May 10, 2000, as amended at 65 FR 50150, Aug. 17, 2000; 66 FR 47109, Sept. 11, 2001; 69 FR 74995, Dec. 15, 2004; 73 FR 46814, Aug. 12, 2008; 83 FR 12683, Mar. 23, 2018; 87 FR 52349, Aug. 25, 2022; 89 FR 20876, Mar. 26, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.7104</SECTNO>
                            <SUBJECT>Developmental assistance costs eligible for reimbursement or credit.</SUBJECT>
                            <P>(a) Developmental assistance provided under an approved mentor-protégé agreement is distinct from, and must not duplicate, any effort that is the normal and expected product of the award and administration of the mentor firm's subcontracts. The mentor firm must accumulate and charge costs associated with the latter in accordance with its approved accounting practices. Mentor firm costs that are eligible for reimbursement are set forth in appendix I.</P>
                            <P>(b) Before incurring any costs under the Program, mentor firms must establish the accounting treatment of developmental assistance costs eligible for reimbursement or credit. For mentor-protégé agreements entered into prior to December 23, 2022, to be eligible for reimbursement under the Program, the mentor firm must incur the costs not later than September 30, 2026.</P>
                            <P>(c) If the mentor firm is suspended or debarred while performing under an approved mentor-protégé agreement, the mentor firm may not be reimbursed or credited for developmental assistance costs incurred more than 30 days after the imposition of the suspension or debarment.</P>
                            <P>
                                (d) For mentor-protégé agreements entered into prior to December 23, 2022, developmental assistance costs incurred by a mentor firm not later than 
                                <PRTPAGE P="170"/>
                                September 30, 2026, that are eligible for crediting under the Program, may be credited toward subcontracting plan goals as set forth in appendix I. For mentor-protégé agreements entered into on or after December 23, 2022, developmental assistance costs that are eligible for crediting under the Program may be credited toward subcontracting plan goals as set forth in appendix I.
                            </P>
                            <CITA>[65 FR 6555, Feb. 10, 2000; 65 FR 30191, May 10, 2000, as amended at 67 FR 77937, Dec. 20, 2002; 70 FR 29645, May 24, 2005; 76 FR 71467, Nov. 18, 2011; 77 FR 11367, Feb. 24, 2012; 83 FR 12683, Mar. 23, 2018; 87 FR 52350, Aug. 25, 2022; 89 FR 20876, Mar. 26, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.7105</SECTNO>
                            <SUBJECT>Reporting.</SUBJECT>
                            <P>Mentor and protégé firms must report on the progress made under mentor-protégé agreements as indicated in appendix I, section I-112.</P>
                            <CITA>[65 FR 6555, Feb. 10, 2000, as amended at 69 FR 74996, Dec. 15, 2004]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>219.7106</SECTNO>
                            <SUBJECT>Performance reviews.</SUBJECT>
                            <P>The DCMA will conduct annual performance reviews of all mentor-protégé agreements as indicated in appendix I, section I-113. The determinations made in these reviews should be a major factor in determinations of amounts of reimbursement, if any, that the mentor firm is eligible to receive in the remaining years of the Program participation term under the agreement.</P>
                            <CITA>[65 FR 50150, Aug. 17, 2000, as amended at 69 FR 74996, Dec. 15, 2004; 87 FR 52350, Aug. 25, 2022]</CITA>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 222</EAR>
                    <HD SOURCE="HED">PART 222—APPLICATION OF LABOR LAWS TO GOVERNMENT ACQUISITIONS</HD>
                    <CONTENTS>
                        <SECHD>Sec.</SECHD>
                        <SECTNO>222.001</SECTNO>
                        <SUBJECT>Definitions.</SUBJECT>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 222.1—Basic Labor Policies</HD>
                            <SECTNO>222.101</SECTNO>
                            <SUBJECT>Labor relations.</SUBJECT>
                            <SECTNO>222.101-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>222.101-3</SECTNO>
                            <SUBJECT>Reporting labor disputes.</SUBJECT>
                            <SECTNO>222.101-3-70</SECTNO>
                            <SUBJECT>Impact of labor disputes on defense programs.</SUBJECT>
                            <SECTNO>222.101-4</SECTNO>
                            <SUBJECT>Removal of items from contractors' facilities affected by work stoppages.</SUBJECT>
                            <SECTNO>222.101-70</SECTNO>
                            <SUBJECT>Acquisition of stevedoring services during labor disputes.</SUBJECT>
                            <SECTNO>222.102</SECTNO>
                            <SUBJECT>Federal and State labor requirements.</SUBJECT>
                            <SECTNO>222.102-1</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>222.103</SECTNO>
                            <SUBJECT>Overtime.</SUBJECT>
                            <SECTNO>222.103-4</SECTNO>
                            <SUBJECT>Approvals.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 222.3—Contract Work Hours and Safety Standards</HD>
                            <SECTNO>222.302</SECTNO>
                            <SUBJECT>Liquidated damages and overtime pay.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 222.4—Labor Standards for Contracts Involving Construction</HD>
                            <SECTNO>222.402</SECTNO>
                            <SUBJECT>Applicability.</SUBJECT>
                            <SECTNO>222.402-70</SECTNO>
                            <SUBJECT>Installation support contracts.</SUBJECT>
                            <SECTNO>222.403</SECTNO>
                            <SUBJECT>Statutory, Executive order, and regulatory requirements.</SUBJECT>
                            <SECTNO>222.403-70</SECTNO>
                            <SUBJECT>Department of Labor regulations.</SUBJECT>
                            <SECTNO>222.404</SECTNO>
                            <SUBJECT>Construction Wage Rate Requirements statute wage determinations.</SUBJECT>
                            <SECTNO>222.404-2</SECTNO>
                            <SUBJECT>General requirements.</SUBJECT>
                            <SECTNO>222.406</SECTNO>
                            <SUBJECT>Administration and enforcement.</SUBJECT>
                            <SECTNO>222.406-1</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>222.406-6</SECTNO>
                            <SUBJECT>Payrolls and statements.</SUBJECT>
                            <SECTNO>222.406-8</SECTNO>
                            <SUBJECT>Investigations.</SUBJECT>
                            <SECTNO>222.406-9</SECTNO>
                            <SUBJECT>Withholding from or suspension of contract payments.</SUBJECT>
                            <SECTNO>222.406-10</SECTNO>
                            <SUBJECT>Disposition of disputes concerning construction contract labor standards enforcement.</SUBJECT>
                            <SECTNO>222.406-13</SECTNO>
                            <SUBJECT>Semiannual enforcement reports.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 222.6—Contracts for Materials, Supplies, Articles, and Equipment</HD>
                            <SECTNO>222.604</SECTNO>
                            <SUBJECT>Exemptions.</SUBJECT>
                            <SECTNO>222.604-2</SECTNO>
                            <SUBJECT>Regulatory exemptions.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 222.8—Equal Employment Opportunity</HD>
                            <SECTNO>222.806</SECTNO>
                            <SUBJECT>Inquiries.</SUBJECT>
                            <SECTNO>222.807</SECTNO>
                            <SUBJECT>Exemptions.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 222.10—Service Contract Labor Standards</HD>
                            <SECTNO>222.1003</SECTNO>
                            <SUBJECT>Applicability.</SUBJECT>
                            <SECTNO>222.1003-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>222.1008</SECTNO>
                            <SUBJECT>Procedures for obtaining wage determinations.</SUBJECT>
                            <SECTNO>222.1008-1</SECTNO>
                            <SUBJECT>Obtaining wage determinations.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 222.13—Equal Opportunity for Veterans</HD>
                            <SECTNO>222.1305</SECTNO>
                            <SUBJECT>Waivers.</SUBJECT>
                            <SECTNO>222.1308</SECTNO>
                            <SUBJECT>Complaint procedures.</SUBJECT>
                            <SECTNO>222.1310</SECTNO>
                            <SUBJECT>Solicitation provision and contract clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 222.14—Employment of Workers with Disabilities</HD>
                            <SECTNO>222.1403</SECTNO>
                            <SUBJECT>Waivers.</SUBJECT>
                            <SECTNO>222.1406</SECTNO>
                            <SUBJECT>Complaint procedures.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <PRTPAGE P="171"/>
                            <HD SOURCE="HED">Subpart 222.17—Combating Trafficking in Persons</HD>
                            <SECTNO>222.1703</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>222.1704</SECTNO>
                            <SUBJECT>Violations and remedies.</SUBJECT>
                            <SECTNO>222.1770</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 222.70—Restrictions on the Employment of Personnel for Work on Construction and Service Contracts in Noncontiguous States</HD>
                            <SECTNO>222.7000</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>222.7001</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <SECTNO>222.7002</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>222.7003</SECTNO>
                            <SUBJECT>Waivers.</SUBJECT>
                            <SECTNO>222.7004</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <RESERVED>Subpart 222.71 [Reserved]</RESERVED>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 222.72—Compliance with Labor Laws of Foreign Governments</HD>
                            <SECTNO>222.7201</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 222.73—Limitations Applicable to Contracts Performed on Guam</HD>
                            <SECTNO>222.7300</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>222.7301</SECTNO>
                            <SUBJECT>Prohibition on use of nonimmigrant aliens.</SUBJECT>
                            <SECTNO>222.7302</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 222.74—Restrictions on the Use of Mandatory Arbitration Agreements</HD>
                            <SECTNO>222.7400</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>222.7401</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <SECTNO>222.7402</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>222.7403</SECTNO>
                            <SUBJECT>Applicability.</SUBJECT>
                            <SECTNO>222.7404</SECTNO>
                            <SUBJECT>Waiver.</SUBJECT>
                            <SECTNO>222.7405</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36358, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SECTION>
                        <SECTNO>222.001</SECTNO>
                        <SUBJECT>Definitions.</SUBJECT>
                        <P>
                            <E T="03">Labor advisor,</E>
                             as used in this part, means the departmental or agency headquarters labor advisor.
                        </P>
                        <CITA>[56 FR 36358, July 31, 1991, as amended at 72 FR 20763, Apr. 26, 2007]</CITA>
                    </SECTION>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 222.1—Basic Labor Policies</HD>
                        <SECTION>
                            <SECTNO>222.101</SECTNO>
                            <SUBJECT>Labor relations.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.101-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>Follow the procedures at PGI 222.101-1 for referral of labor relations matters to the appropriate authorities.</P>
                            <CITA>[71 FR 18670, Apr. 12, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.101-3</SECTNO>
                            <SUBJECT>Reporting labor disputes.</SUBJECT>
                            <P>Follow the procedures at PGI 222.101-3 for reporting labor disputes.</P>
                            <CITA>[71 FR 18670, Apr. 12, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.101-3-70</SECTNO>
                            <SUBJECT>Impact of labor disputes on defense programs.</SUBJECT>
                            <P>(a) Each department and agency shall determine the degree of impact of potential or actual labor disputes on its own programs and requirements. For guidance on determining the degree of impact, see PGI 222.101-3-70(a).</P>
                            <P>(b) Each contracting activity shall obtain and develop data reflecting the impact of a labor dispute on its requirements and programs. Upon determining that the impact of the labor dispute is significant, the head of the contracting activity shall submit a report of findings and recommendations to the labor advisor in accordance with departmental procedures.</P>
                            <CITA>[71 FR 18670, Apr. 12, 2006, as amended at 80 FR 67255, Oct. 30, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.101-4</SECTNO>
                            <SUBJECT>Removal of items from contractors' facilities affected by work stoppages.</SUBJECT>
                            <P>(a) When a contractor is unable to deliver urgent and critical items because of a work stoppage at its facility, the contracting officer, before removing any items from the facility, shall—</P>
                            <P>(i) Before initiating any action, contact the labor advisor to obtain the opinion of the national office of the Federal Mediation and Conciliation Service or other mediation agency regarding the effect movement of the items would have on labor negotiations. Normally removals will not be made if they will adversely affect labor negotiations.</P>
                            <P>
                                (ii) Upon the recommendation of the labor advisor, provide a written request 
                                <PRTPAGE P="172"/>
                                for removal of the material to the cognizant contract administration office. Include in the request the information specified at PGI 222.101-4(a)(ii).
                            </P>
                            <P>(iii) With the assistance of the labor advisor or the commander of the contract administration office, attempt to have both the management and the labor representatives involved agree to shipment of the material by normal means.</P>
                            <P>(iv) If agreement for removal of the needed items cannot be reached following the procedures in paragraphs (a) (i) through (iii) of this subsection, the commander of the contract administration office, after obtaining approval from the labor advisor, may seek the concurrence of the parties to the dispute to permit movement of the material by military vehicles with military personnel. On receipt of such concurrences, the commander may proceed to make necessary arrangements to move the material.</P>
                            <P>(v) If agreement for removal of the needed items cannot be reached following any of the procedures in paragraphs (a) (i) through (iv) of this subsection, refer the matter to the labor advisor with the information required by 222.101-3-70(b). If the labor advisor is unsuccessful in obtaining concurrence of the parties for the movement of the material and further action to obtain the material is deemed necessary, refer the matter to the agency head. Upon review and verification that the items are urgently or critically needed and cannot be moved with the consent of the parties, the agency head, on a nondelegable basis, may order removal of the items from the facility.</P>
                            <CITA>[56 FR 36358, July 31, 1991, as amended at 71 FR 18670, Apr. 12, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.101-70</SECTNO>
                            <SUBJECT>Acquisition of stevedoring services during labor disputes.</SUBJECT>
                            <P>(a) Use the following procedures only in the order listed when a labor dispute delays performance of a contract for stevedoring services which are urgently needed.</P>
                            <P>(1) Attempt to have management and labor voluntarily agree to exempt military supplies from the labor dispute by continuing the movement of such material.</P>
                            <P>(2) Divert vessels to alternate ports able to provide necessary stevedoring services.</P>
                            <P>(3) Consider contracting with reliable alternative sources of supply within the stevedoring industry.</P>
                            <P>(4) Utilize civil service stevedores to perform the work performed by contract stevedores.</P>
                            <P>(5) Utilize military personnel to handle the cargo which was being handled by contract stevedores prior to the labor dispute.</P>
                            <P>(b) Notify the labor advisor when a deviation from the procedures in paragraph (a) of this subsection is required.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.102</SECTNO>
                            <SUBJECT>Federal and State labor requirements.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.102-1</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(1) Direct all inquiries from contractors or contractor employees regarding the applicability or interpretation of Occupational Safety and Health Act (OSHA) regulations to the Department of Labor.</P>
                            <P>(2) Upon request, provide the address of the appropriate field office of the Occupational Safety and Health Administration of the Department of Labor.</P>
                            <P>(3) Do not initiate any application for the suspension or relaxation of labor requirements without prior coordination with the labor advisor. Any requests for variances or alternative means of compliance with OSHA requirements must be approved by the Occupational Safety and Health Administration of the Department of Labor.</P>
                            <CITA>[71 FR 18670, Apr. 12, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.103</SECTNO>
                            <SUBJECT>Overtime.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.103-4</SECTNO>
                            <SUBJECT>Approvals.</SUBJECT>
                            <P>(a) The department/agency approving official shall—</P>
                            <P>(i) Obtain the concurrence of other appropriate approving officials; and</P>
                            <P>(ii) Seek agreement as to the contracts under which overtime premiums will be approved when—</P>
                            <P>
                                (A) Two or more contracting offices have current contracts at the same contractor facility; and
                                <PRTPAGE P="173"/>
                            </P>
                            <P>(B) The approval of overtime by one contracting office will affect the performance or cost of contracts of another office. In the absence of evidence to the contrary, a contracting officer may rely on a contractor's statement that approval of overtime premium pay for one contract will not affect performance or payments under any other contract.</P>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 222.3—Contract Work Hours and Safety Standards</HD>
                        <SECTION>
                            <SECTNO>222.302</SECTNO>
                            <SUBJECT>Liquidated damages and overtime pay.</SUBJECT>
                            <P>Upon receipt of notification of Contract Work Hours and Safety Standards violations, the contracting officer shall—</P>
                            <P>(1) Immediately withhold such funds as are available;</P>
                            <P>(2) Give the contractor written notification of the withholding and a statement of the basis for the liquidated damages assessment. The written notification shall also inform the contractor of its 60 days right to appeal the assessment, through the contracting officer, to the agency official responsible for acting on such appeals; and</P>
                            <P>(3) If funds available for withholding are insufficient to cover liquidated damages, ask the contractor to pay voluntarily such funds as are necessary to cover the total liquidated damage assessment.</P>
                            <P>(d)(i) The assessment shall become the final administrative determination of contractor liability for liquidated damages when—</P>
                            <P>(A) The contractor fails to appeal to the contracting agency within 60 days from the date of the withholding of funds;</P>
                            <P>(B) The department agency, following the contractor's appeals, issues a final order which affirms the assessment of liquidated damages or waives damages of $500 or less; or</P>
                            <P>(C) The Secretary of Labor takes final action on a recommendation of the agency head to waive or adjust liquidated damages in excess of $500.</P>
                            <P>(ii) Upon final administrative determination of the contractor's liability for liquidated damages, the contracting officer shall transmit withheld or collected funds determined to be owed the Government as liquidated damages to the servicing finance and accounting officer for crediting to the appropriate Government Treasury account. The contracting officer shall return any excess withheld funds to the contractor.</P>
                            <CITA>[56 FR 36358, July 31, 1991, as amended at 77 FR 35880, June 15, 2012]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 222.4—Labor Standards for Contracts Involving Construction</HD>
                        <SECTION>
                            <SECTNO>222.402</SECTNO>
                            <SUBJECT>Applicability.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.402-70</SECTNO>
                            <SUBJECT>Installation support contracts.</SUBJECT>
                            <P>(a) Apply both the Service Contract Labor Standards statute and the Construction Wage Rate Requirements statute to installation support contracts if—</P>
                            <P>(1) The contract is principally for services but also requires a substantial and segregable amount of construction, alteration, renovation, painting, or repair work; and</P>
                            <P>(2) The aggregate dollar value of such construction work exceeds or is expected to exceed $2,000.</P>
                            <P>
                                (b) 
                                <E T="03">Service Contract Labor Standards statute coverage under the contract.</E>
                                 Contract installation support requirements, such as plant operation and installation services (i.e., custodial, snow removal, etc.) are subject to the Service Contract Labor Standards. Apply Service Contract Labor Standards clauses and minimum wage and fringe benefit requirements to all contract service calls or orders for such maintenance and support work.
                            </P>
                            <P>
                                (c) 
                                <E T="03">Construction Wage Rate Requirements statute coverage under the contract.</E>
                                 Contract construction, alteration, renovation, painting, and repair requirements (i.e., roof shingling, building structural repair, paving repairs, etc.) are subject to the Construction Wage Rate Requirements statute. Apply Construction Wage Rate Requirements clauses and minimum wage requirements to all contract service calls or orders for construction, alteration, renovation, painting, or repairs to buildings or other works.
                                <PRTPAGE P="174"/>
                            </P>
                            <P>
                                (d) 
                                <E T="03">Repairs versus maintenance.</E>
                                 Some contract work may be characterized as either Construction Wage Rate Requirements painting/repairs or Service Contract Labor Standards maintenance. For example, replacing broken windows, spot painting, or minor patching of a wall could be covered by either the Construction Wage Rate Requirements or the Service Contract Labor Standards. In those instances where a contract service call or order requires construction trade skills (i.e., carpenter, plumber, painter, etc.), but it is unclear whether the work required is Service Contract Labor Standards maintenance or Construction Wage Rate Requirements painting/repairs, apply the following rules:
                            </P>
                            <P>(1) Individual service calls or orders which will require a total of 32 or more work hours to perform shall be considered to be repair work subject to the Construction Wage Rate Requirements.</P>
                            <P>(2) Individual service calls or orders which will require less than 32 work hours to perform shall be considered to be maintenance subject to the Service Contract Labor Standards.</P>
                            <P>(3) Painting work of 200 square feet or more to be performed under an individual service call or order shall be considered to be subject to the Construction Wage Rate Requirements statute regardless of the total work hours required.</P>
                            <P>(e) The determination of labor standards application shall be made at the time the solicitation is prepared in those cases where requirements can be identified. Otherwise, the determination shall be made at the time the service call or order is placed against the contract. The service call or order shall identify the labor standards law and contract wage determination which will apply to the work required.</P>
                            <P>(f) Contracting officers may not avoid application of the Construction Wage Rate Requirements statute by splitting individual tasks between orders or contracts.</P>
                            <CITA>[56 FR 36358, July 31, 1991, as amended at 77 FR 35880, June 15, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.403</SECTNO>
                            <SUBJECT>Statutory, Executive order, and regulatory requirements.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.403-70</SECTNO>
                            <SUBJECT>Department of Labor regulations.</SUBJECT>
                            <P>Direct all questions regarding Department of Labor regulations to the labor advisor.</P>
                            <CITA>[56 FR 36284, July 31, 1991. Redesignated at 86 FR 59870, Oct. 29, 2021]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.404</SECTNO>
                            <SUBJECT>Construction Wage Rate Requirements statute wage determinations.</SUBJECT>
                            <P>Not later than April 1 of each year, each department and agency shall furnish the Administrator, Wage and Hour Division, with a general outline of its proposed construction program for the coming fiscal year. The Department of Labor uses this information to determine where general wage determination surveys will be conducted.</P>
                            <P>(1) Indicate by individual project of $500,000 or more—</P>
                            <P>(i) The anticipated type of construction;</P>
                            <P>(ii) The estimated dollar value; and</P>
                            <P>(iii) The location in which the work is to be performed (city, town, village, county, or other civil subdivision of the state).</P>
                            <P>(2) The report format is contained in Department of Labor All Agency Memo 144, December 27, 1985.</P>
                            <P>(3) The report control number is 1671-DOL-AN.</P>
                            <CITA>[56 FR 36358, July 31, 1991, as amended at 77 FR 35880, June 15, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.404-2</SECTNO>
                            <SUBJECT>General requirements.</SUBJECT>
                            <P>(c)(5) Follow the procedures at PGI 222.404-2(c)(5) when seeking clarification of the proper application of construction wage rate schedules.</P>
                            <CITA>[72 FR 20764, Apr. 26, 2007]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.406</SECTNO>
                            <SUBJECT>Administration and enforcement.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.406-1</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">General.</E>
                                 The program shall also include—
                            </P>
                            <P>
                                (i) Training appropriate contract administration, labor relations, inspection, and other labor standards enforcement personnel in their responsibilities; and
                                <PRTPAGE P="175"/>
                            </P>
                            <P>(ii) Periodic review of field enforcement activities to ensure compliance with applicable regulations and instructions.</P>
                            <P>
                                (b) 
                                <E T="03">Preconstruction letters and conferences.</E>
                                 (1) Promptly after award of the contract, the contracting officer shall provide a preconstruction letter to the prime contractor. This letter should accomplish the following, as appropriate—
                            </P>
                            <P>(A) Indicate that the labor standards requirements contained in the contract are based on the following statutes and regulations—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Construction Wage Rate Requirements statute.
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Contract Work Hours and Safety Standards statute;
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) Copeland (Anti-Kickback) Act;
                            </P>
                            <P>
                                (
                                <E T="03">4</E>
                                ) Parts 3 and 5 of the Secretary of Labor's Regulations (parts 3 and 5, subtitle A, title 29, CFR); and
                            </P>
                            <P>
                                (
                                <E T="03">5</E>
                                ) Executive Order 11246 (Equal Employment Opportunity);
                            </P>
                            <P>(B) Call attention to the labor standards requirements in the contract which relate to—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Employment of foremen, laborers, mechanics, and others;
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Wages and fringe benefits payments, payrolls, and statements;
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) Differentiation between subcontractors and suppliers;
                            </P>
                            <P>
                                (
                                <E T="03">4</E>
                                ) Additional classifications;
                            </P>
                            <P>
                                (
                                <E T="03">5</E>
                                ) Benefits to be realized by contractors and subcontractors in keeping complete work records;
                            </P>
                            <P>
                                (
                                <E T="03">6</E>
                                ) Penalties and sanctions for violations of the labor standards provisions; and
                            </P>
                            <P>
                                (
                                <E T="03">7</E>
                                ) The applicable provisions of FAR 22.403; and
                            </P>
                            <P>(C) Ensure that the contractor sends a copy of the preconstruction letter to each subcontractor.</P>
                            <P>(2) Before construction begins, the contracting officer shall confer with the prime contractor and any subcontractor designated by the prime to emphasize their labor standards obligations under the contract when—</P>
                            <P>(A) The prime contractor has not performed previous Government contracts;</P>
                            <P>(B) The prime contractor experienced difficulty in complying with labor standards requirements on previous contracts; or</P>
                            <P>(C) It is necessary to determine whether the contractor and its subcontractors intend to pay any required fringe benefits in the manner specified in the wage determination or to elect a different method of payment. If the latter, inform the contractor of the requirements of FAR 22.406-2.</P>
                            <CITA>[56 FR 36358, July 31, 1991, as amended at 77 FR 35880, June 15, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.406-6</SECTNO>
                            <SUBJECT>Payrolls and statements.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Submission.</E>
                                 Contractors who do not use Department of Labor Form WH 347 or its equivalent must submit a DD Form 879, Statement of Compliance, with each payroll report.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.406-8</SECTNO>
                            <SUBJECT>Investigations.</SUBJECT>
                            <P>(a) Before beginning an investigation, the investigator shall inform the contractor of the general scope of the investigation, and that the investigation will include examining pertinent records and interviewing employees. In conducting the investigation, follow the procedures at PGI 222.406-8(a).</P>
                            <P>
                                (c) 
                                <E T="03">Contractor notification.</E>
                                 (4)(A) Notify the contractor by certified mail of any finding that it is liable for liquidated damages under the Contract Work Hours and Safety Standards (CWHSS) statute. The notification shall inform the contractor that—
                            </P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) It has 60 days after receipt of the notice to appeal the assessment of liquidated damages; and
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) The appeal must demonstrate either that the alleged violations did not occur at all, occurred inadvertently notwithstanding the exercise of due care, or the assessment was computed improperly.
                            </P>
                            <P>(B) If an appeal is received, the contracting officer shall process the appeal in accordance with department or agency regulations.</P>
                            <P>
                                (d) 
                                <E T="03">Contracting officer's report.</E>
                                 Forward a detailed enforcement report or summary report to the agency head in accordance with agency procedures. Include in the report, as a minimum, the information specified at PGI 222.406-8(d).
                            </P>
                            <CITA>[56 FR 36358, July 31, 1991, as amended at 71 FR 18670, Apr. 12, 2006; 77 FR 35880, June 15, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="176"/>
                            <SECTNO>222.406-9</SECTNO>
                            <SUBJECT>Withholding from or suspension of contract payments.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Withholding from contract payments.</E>
                                 The contracting officer shall contact the labor advisor for assistance when payments due a contractor are not available to satisfy that contractor's liability for Construction Wage Rate Requirements or CWHSS statute wage underpayments or liquidated damages.
                            </P>
                            <P>
                                (c) 
                                <E T="03">Disposition of contract payments withheld or suspended</E>
                                —(3) 
                                <E T="03">Limitation on forwarding or returning funds.</E>
                                 When disposition of withheld funds remains the final action necessary to close out a contract, the Department of Labor will retain withheld funds pending completion of an investigation or other administrative proceedings.
                            </P>
                            <P>
                                (4) 
                                <E T="03">Liquidated damages.</E>
                                 (A) The agency head may adjust liquidated damages of $500 or less when the amount assessed is incorrect or waive the assessment when the violations—
                            </P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Were nonwillful or inadvertent; and
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Occurred notwithstanding the exercise of due care by the contractor, its subcontractor, or their agents.
                            </P>
                            <P>(B) The agency head may recommend to the Administrator, Wage and Hour Division, that the liquidated damages over $500 be adjusted because the amount assessed is incorrect. The agency head may also recommend the assessment be waived when the violations—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Were nonwillful or inadvertent; and
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Occurred notwithstanding the exercise of due care by the contractor, the subcontractor, or their agents.
                            </P>
                            <CITA>[56 FR 36358, July 31, 1991, as amended at 77 FR 35880, June 15, 2012; 82 FR 61480, Dec. 28, 2017]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.406-10</SECTNO>
                            <SUBJECT>Disposition of disputes concerning construction contract labor standards enforcement.</SUBJECT>
                            <P>(d) Forward the contracting officer's findings and the contractor's statement through the labor advisor.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.406-13</SECTNO>
                            <SUBJECT>Semiannual enforcement reports.</SUBJECT>
                            <P>Forward these reports through the head of the contracting activity to the labor advisor within 15 days following the end of the reporting period. These reports shall not include information from investigations conducted by the Department of Labor. These reports shall contain the following information, as applicable, for construction work subject to the Construction Wage Rate Requirements statute and the CWSS statute—</P>
                            <P>(1) Period covered;</P>
                            <P>(2) Number of prime contracts awarded;</P>
                            <P>(3) Total dollar amount of prime contracts awarded;</P>
                            <P>(4) Number of contractors/subcontractors against whom complaints were received;</P>
                            <P>(5) Number of investigations conducted;</P>
                            <P>(6) Number of contractors/subcontractors found in violation;</P>
                            <P>(7) Amount of wage restitution found due under—</P>
                            <P>(i) Construction Wage Rate Requirements statute; and</P>
                            <P>(ii) CWSS statute;</P>
                            <P>(8) Number of employees due wage restitution under—</P>
                            <P>(i) Construction Wage Rate Requirements statute; and</P>
                            <P>(ii) CWHSS statute;</P>
                            <P>(9) Amount of liquidated damages assessed under the CWSS statute—</P>
                            <P>(i) Total amount; and</P>
                            <P>(ii) Number of contracts involved;</P>
                            <P>(10) Number of employees and amount paid/withheld under—</P>
                            <P>(i) Construction Wage Rate Requirements statute;</P>
                            <P>(ii) CWSS statute;</P>
                            <P>(iii) Copeland Act; and</P>
                            <P>(11) Preconstruction activities—</P>
                            <P>(i) Number of compliance checks performed</P>
                            <P>(ii) Preconstruction letters sent.</P>
                            <CITA>[56 FR 36358, July 31, 1991, as amended at 77 FR 35880, June 15, 2012]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <PRTPAGE P="177"/>
                        <HD SOURCE="HED">Subpart 222.6—Contracts for Materials, Supplies, Articles, and Equipment</HD>
                        <SECTION>
                            <SECTNO>222.604</SECTNO>
                            <SUBJECT>Exemptions.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.604-2</SECTNO>
                            <SUBJECT>Regulatory exemptions.</SUBJECT>
                            <P>(b) Submit all applications for such exemptions through contracting channels to the labor advisor.</P>
                            <CITA>[56 FR 36358, July 31, 1991, as amended at 65 FR 14398, Mar. 16, 2000]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 222.8—Equal Employment Opportunity</HD>
                        <SECTION>
                            <SECTNO>222.806</SECTNO>
                            <SUBJECT>Inquiries.</SUBJECT>
                            <P>(b) Refer inquiries through the labor advisor.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.807</SECTNO>
                            <SUBJECT>Exemptions.</SUBJECT>
                            <P>(c) Follow the procedures at PGI 222.807(c) when submitting a request for an exemption.</P>
                            <CITA>[71 FR 18670, Apr. 12, 2006]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 222.10—Service Contract Labor Standards</HD>
                        <SECTION>
                            <SECTNO>222.1003</SECTNO>
                            <SUBJECT>Applicability.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.1003-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>For contracts having a substantial amount of construction, alteration, renovation, painting, or repair work, see 222.402-70.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.1008</SECTNO>
                            <SUBJECT>Procedures for obtaining wage determinations.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.1008-1</SECTNO>
                            <SUBJECT>Obtaining wage determinations.</SUBJECT>
                            <P>Follow the procedures at PGI 222.1008-1 regarding use of the Service Contract Act Directory of Occupations when preparing the e98.</P>
                            <CITA>[72 FR 20764, Apr. 26, 2007]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 222.13—Equal Opportunity for Veterans</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>71 FR 18670, Apr. 12, 2006, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>222.1305</SECTNO>
                            <SUBJECT>Waivers.</SUBJECT>
                            <P>(c) Follow the procedures at PGI 222.1305(c) for submission of waiver requests.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.1308</SECTNO>
                            <SUBJECT>Complaint procedures.</SUBJECT>
                            <P>The contracting officer shall—</P>
                            <P>(1) Forward each complaint received as indicated in FAR 22.1308; and</P>
                            <P>(2) Notify the complainant of the referral. The contractor in question shall not be advised in any manner or for any reason of the complainant's name, the nature of the complaint, or the fact that the complaint was received.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.1310</SECTNO>
                            <SUBJECT>Solicitation provision and contract clauses.</SUBJECT>
                            <P>(a)(1) Use of the clause at FAR 52.222-35, Equal Opportunity for Veterans, with its paragraph (c), Listing Openings, also satisfies the requirement of 10 U.S.C. 4704.</P>
                            <CITA>[71 FR 18670, Apr. 12, 2006, as amended at 80 FR 67255, Oct. 30, 2015; 87 FR 76993, Dec. 16, 2022]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 222.14—Employment of Workers with Disabilities</HD>
                        <SECTION>
                            <SECTNO>222.1403</SECTNO>
                            <SUBJECT>Waivers.</SUBJECT>
                            <P>(c) The contracting officer shall submit a waiver request through contracting channels to the labor advisor. If the request is justified, the labor advisor will endorse the request and forward it for action to—</P>
                            <P>(i) The agency head for waivers under FAR 22.1403(a). For the defense agencies, waivers must be approved by the Assistant Secretary of Defense for Acquisition.</P>
                            <P>(ii) The Secretary of Defense, without the power of redelegation, for waivers under FAR 22.1403(b).</P>
                            <CITA>[56 FR 36358, July 31, 1991, as amended at 88 FR 73236, Oct. 25, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.1406</SECTNO>
                            <SUBJECT>Complaint procedures.</SUBJECT>
                            <P>The contracting officer shall notify the complainant of such referral. The contractor in question shall not be advised in any manner or for any reason of the complainant's name, the nature of the complaint, or the fact that the complaint was received.</P>
                            <CITA>[71 FR 18671, Apr. 12, 2006]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <PRTPAGE P="178"/>
                        <HD SOURCE="HED">Subpart 222.17—Combating Trafficking in Persons</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>71 FR 62563, Oct. 26, 2006, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>222.1703</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>See PGI 222.1703 for additional information regarding DoD policy for combating trafficking in persons outside the United States.</P>
                            <CITA>[73 FR 4115, Jan. 24, 2008]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.1704</SECTNO>
                            <SUBJECT>Violations and remedies.</SUBJECT>
                            <P>Follow the procedures at PGI 222.1704 for notifying the Combatant Commander if a violation occurs.</P>
                            <CITA>[73 FR 4115, Jan. 24, 2008]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.1770</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>For a sample checklist for auditing compliance with Combating Trafficking in Persons policy, see the Defense Contract Management Agency checklist, Afghanistan Universal Examination Record Combating Trafficking in Persons, available at DFARS Procedures Guidance and Information 222.17.</P>
                            <CITA>[80 FR 5001, Jan. 29, 2015]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 222.70—Restrictions on the Employment of Personnel for Work on Construction and Service Contracts in Noncontiguous States</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>65 FR 14403, Mar. 16, 2000, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>222.7000</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>(a) This subpart implements Section 8071 of the Fiscal Year 2000 Defense Appropriations Act, Public Law 106-79, and similar sections in subsequent Defense Appropriations Acts.</P>
                            <P>(b) This subpart applies only—</P>
                            <P>(1) To construction and service contracts to be performed in whole or in part within a noncontiguous State; and</P>
                            <P>(2) When the unemployment rate in the noncontiguous State is in excess of the national average rate of unemployment as determined by the Secretary of Labor.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.7001</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <P>“Noncontiguous State,” as used in this subpart, means Alaska, Hawaii, Puerto Rico, the Northern Mariana Islands, American Samoa, Guam, the U.S. Virgin Islands, Baker Island, Howland Island, Jarvis Island, Johnston Atoll, Kingman Reef, Midway Islands, Navassa Island, Palmyra Atoll, and Wake Island.</P>
                            <CITA>[65 FR 50151, Aug. 17, 2000]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.7002</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>A contractor awarded a contract subject to this subpart must employ, for the purpose of performing that portion of the contract work within the noncontiguous State, individuals who are residents of that noncontiguous State and who, in the case of any craft or trade, possess or would be able to acquire promptly the necessary skills to perform this contract.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.7003</SECTNO>
                            <SUBJECT>Waivers.</SUBJECT>
                            <P>The head of the agency may waive the requirements of 222.7002 on a case-by-case basis in the interest of national security.</P>
                            <CITA>[65 FR 50151, Aug. 17, 2000]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.7004</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at 252.222-7000, Restrictions on Employment of Personnel, in all solicitations and contracts subject to this subpart. Insert the name of the appropriate noncontiguous State in paragraph (a) of the clause.</P>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <RESERVED>Subpart 222.71 [Reserved]</RESERVED>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 222.72—Compliance with Labor Laws of Foreign Governments</HD>
                        <SECTION>
                            <SECTNO>222.7201</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>(a) Use the clause at 252.222-7002, Compliance with Local Labor Laws (Overseas), in solicitations and contracts for services or construction to be performed outside the United States and its outlying areas.</P>
                            <P>
                                (b) Use the clause at 252.222-7003, Permit from Italian Inspectorate of Labor, in solicitations and contracts for porter, janitorial, or ordinary facility and 
                                <PRTPAGE P="179"/>
                                equipment maintenance services to be performed in Italy.
                            </P>
                            <P>(c) Use the clause at 252.222-7004, Compliance with Spanish Social Security Laws and Regulations, in solicitations and contracts for services or construction to be performed in Spain.</P>
                            <CITA>[62 FR 34122, June 24, 1997, as amended at 70 FR 35545, June 21, 2005]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 222.73—Limitations Applicable to Contracts Performed on Guam</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>64 FR 52672, Sept. 30, 1999, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>222.7300</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>This subpart—</P>
                            <P>(a) Implements Section 390 of the National Defense Authorization Act for Fiscal Year 1998 (Pub. L. 105-85); and</P>
                            <P>(b) Applies to contracts for base operations support on Guam that—</P>
                            <P>(1) Are awarded as a result of a competition conducted under OMB Circular A-76; and</P>
                            <P>(2) Are entered into or modified on or after November 18, 1997.</P>
                            <CITA>[72 FR 20764, Apr. 26, 2007]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.7301</SECTNO>
                            <SUBJECT>Prohibition on use of nonimmigrant aliens.</SUBJECT>
                            <P>(a) Any alien who is issued a visa or otherwise provided nonimmigrant status under Section 101(a)(15)(H)(ii) of the Immigration and Nationality Act (8 U.S.C. 1101(a)(15)(H)(ii)) is prohibited from performing work under a contract for base operations support on Guam.</P>
                            <P>(b) Lawfully admitted citizens of the freely associated states of the Republic of the Marshall Islands, the Federated States of Micronesia, or the Republic of Palau are not subject to the prohibition in paragraph (a) of this section.</P>
                            <CITA>[64 FR 52672, Sept. 30, 1999, as amended at 72 FR 20764, Apr. 26, 2007]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.7302</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at 252.222-7005, Prohibition on Use of Nonimmigrant Aliens—Guam, in solicitations and contracts subject to this subpart.</P>
                            <CITA>[72 FR 20764, Apr. 26, 2007]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 222.74—Restrictions on the Use of Mandatory Arbitration Agreements</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>75 FR 27947, May 19, 2010, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>222.7400</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>This subpart implements section 8116 of the Defense Appropriations Act for Fiscal Year 2010 (Pub. L. 111-118) and similar sections in subsequent DoD appropriations acts.</P>
                            <CITA>[76 FR 38048, June 29, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.7401</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <P>
                                <E T="03">Covered subcontractor,</E>
                                 as used in this subpart, is defined in the clause at 252.222-7006, Restrictions on the Use of Mandatory Arbitration Agreements.
                            </P>
                            <CITA>[75 FR 76297, Dec. 8, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.7402</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(a) Departments and agencies are prohibited from using funds appropriated or otherwise made available by the Fiscal Year 2010 Defense Appropriations Act (Pub. L. 111-118) or subsequent DoD appropriations acts for any contract (including task or delivery orders and bilateral modifications adding new work) in excess of $1 million, unless the contractor agrees not to—</P>
                            <P>(1) Enter into any agreement with any of its employees or independent contractors that requires, as a condition of employment, that the employee or independent contractor agree to resolve through arbitration—</P>
                            <P>(i) Any claim under title VII of the Civil Rights Act of 1964; or</P>
                            <P>(ii) Any tort related to or arising out of sexual assault or harassment, including assault and battery, intentional infliction of emotional distress, false imprisonment, or negligent hiring, supervision, or retention; or</P>
                            <P>(2) Take any action to enforce any provision of an existing agreement with an employee or independent contractor that mandates that the employee or independent contractor resolve through arbitration—</P>
                            <P>
                                (i) Any claim under title VII of the Civil Rights Act of 1964; or
                                <PRTPAGE P="180"/>
                            </P>
                            <P>(ii) Any tort related to or arising out of sexual assault or harassment, including assault and battery, intentional infliction of emotional distress, false imprisonment, or negligent hiring, supervision, or retention.</P>
                            <P>(b) No funds appropriated or otherwise made available by the Fiscal Year 2010 Defense Appropriations Act (Pub. L. 111-118) or subsequent DoD appropriations acts may be expended unless the contractor certifies that it requires each covered subcontractor to agree not to enter into, and not to take any action to enforce, any provision of any agreement, as described in paragraph (a) of this section, with respect to any employee or independent contractor performing work related to such subcontract.</P>
                            <CITA>[75 FR 27947, May 19, 2010. Redesignated at 75 FR 76297, Dec. 8, 2010; 76 FR 38048, June 29, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.7403</SECTNO>
                            <SUBJECT>Applicability.</SUBJECT>
                            <P>This requirement does not apply to the acquisition of commercial products or commercial services (including commercially available off-the-shelf items).</P>
                            <CITA>[75 FR 76297, Dec. 8, 2010, as amended at 88 FR 6583, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.7404</SECTNO>
                            <SUBJECT>Waiver.</SUBJECT>
                            <P>(a) The Secretary of Defense may waive, in accordance with paragraphs (b) through (d) of this section, the applicability of paragraphs (a) or (b) of 222.7402 to a particular contract or subcontract, if the Secretary or the Deputy Secretary personally determines that the waiver is necessary to avoid harm to national security interests of the United States, and that the term of the contract or subcontract is not longer than necessary to avoid such harm.</P>
                            <P>(b) The waiver determination shall set forth the grounds for the waiver with specificity, stating any alternatives considered, and explain why each of the alternatives would not avoid harm to national security interests.</P>
                            <P>(c) The contracting officer shall submit requests for waivers in accordance with agency procedures and PGI 222.7404(c).</P>
                            <P>
                                (d) The Secretary of Defense will transmit the determination to Congress and simultaneously publish it in the 
                                <E T="04">Federal Register,</E>
                                 not less than 15 business days before the contract or subcontract addressed in the determination may be awarded.
                            </P>
                            <CITA>[75 FR 76297, Dec. 8, 2010, as amended at 78 FR 36113, June 17, 2013]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>222.7405</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at 252.222-7006, Restrictions on the Use of Mandatory Arbitration Agreements, in all solicitations and contracts (including task orders or delivery orders and bilateral modifications adding new work) valued in excess of $1 million utilizing funds appropriated or otherwise made available by the Defense Appropriations Act for Fiscal Year 2010 (Pub. L. 111-118) or subsequent DoD appropriations acts, except in contracts for the acquisition of commercial products, including commercially available off-the-shelf items, or commercial services.</P>
                            <CITA>[76 FR 38048, June 29, 2011, as amended at 88 FR 6583, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 223</EAR>
                    <HD SOURCE="HED">PART 223—ENVIRONMENT, SUSTAINABLE ACQUISITION, AND MATERIAL SAFETY</HD>
                    <CONTENTS>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 223.1—Sustainable Products and Services</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>223.107-1</SECTNO>
                            <SUBJECT>Products containing recovered materials.</SUBJECT>
                            <SECTNO>223.107-4</SECTNO>
                            <SUBJECT>Products that contain, use, or are manufactured with ozone-depleting substances or products that contain or use high global warming potential hydrofluorocarbons.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 223.3—Hazardous Material Identification, Material Safety Data, and Notice of Radioactive Materials</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>223.302</SECTNO>
                            <SUBJECT>Hazardous material identification and notice of material safety data.</SUBJECT>
                            <SECTNO>223.304</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <SECTNO>223.370</SECTNO>
                            <SUBJECT>Safety precautions for ammunition and explosives.</SUBJECT>
                            <SECTNO>223.370-1</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>223.370-2</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <SECTNO>223.370-3</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>223.370-4</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>223.370-5</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <PRTPAGE P="181"/>
                            <RESERVED>Subparts 223.4-223.5 [Reserved]</RESERVED>
                        </SUBPART>
                        <SUBPART>
                            <RESERVED>Subpart 223.70 [Reserved]</RESERVED>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 223.71—Storage, Treatment, and Disposal of Toxic or Hazardous Materials</HD>
                            <SECTNO>223.7101</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>223.7102</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>223.7103</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>223.7104</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <SECTNO>223.7105</SECTNO>
                            <SUBJECT>Reimbursement.</SUBJECT>
                            <SECTNO>223.7106</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 223.72—Safeguarding Sensitive Conventional Arms, Ammunition, and Explosives</HD>
                            <SECTNO>223.7200</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <SECTNO>223.7201</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>223.7202</SECTNO>
                            <SUBJECT>Preaward responsibilities.</SUBJECT>
                            <SECTNO>223.7203</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 223.73—Minimizing the Use of Materials Containing Hexavalent Chromium</HD>
                            <SECTNO>223.7300</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <SECTNO>223.7301</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>223.7302</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>223.7303</SECTNO>
                            <SUBJECT>Prohibition.</SUBJECT>
                            <SECTNO>223.7304</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <SECTNO>223.7305</SECTNO>
                            <SUBJECT>Authorization and approval.</SUBJECT>
                            <SECTNO>223.7306</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 223.74—Prohibition on Procurement of Certain Items Containing Perfluoroalkyl or Polyfluoroalkyl Substances</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>223.7400</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>223.7401</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <SECTNO>223.7402</SECTNO>
                            <SUBJECT>Prohibition.</SUBJECT>
                            <SECTNO>223.7403</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>223.7404</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36365, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 223.1—Sustainable Products and Services</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>89 FR 66284, Aug. 15, 2024, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>223.107-1</SECTNO>
                            <SUBJECT>Products containing recovered materials.</SUBJECT>
                            <P>
                                (e) 
                                <E T="03">Procedures.</E>
                                 Follow the procedures at PGI 223.107-1(e).
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>223.107-4</SECTNO>
                            <SUBJECT>Products that contain, use, or are manufactured with ozone-depleting substances or products that contain or use high global warming potential hydrofluorocarbons.</SUBJECT>
                            <P>No DoD contract may include a specification or standard that requires the use of a class I ozone-depleting substance or that can be met only through the use of such a substance unless the inclusion of the specification or standard is specifically authorized at a level no lower than a general or flag officer or a member of the Senior Executive Service of the requiring activity in accordance with section 326, Public Law 102-484 (10 U.S.C. 3201 note prec.). This restriction is in addition to any imposed by the Clean Air Act and applies after June 1, 1993, to all DoD contracts, regardless of place of performance.</P>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 223.3—Hazardous Material Identification, Material Safety Data, and Notice of Radioactive Materials</HD>
                        <SECTION>
                            <SECTNO>223.302</SECTNO>
                            <SUBJECT>Hazardous material identification and notice of material safety data.</SUBJECT>
                            <P>(e) The contracting officer shall also provide hazard warning labels, that are received from apparent successful offerors, to the cognizant safety officer.</P>
                            <CITA>[70 FR 73150, Dec. 9, 2005, as amended at 89 FR 66284, Aug. 15, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>223.304</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>Use the clause at 252.223-7001, Hazard Warning Labels, in solicitations and contracts which require submission of hazardous material data sheets (see FAR 23.302(c)).</P>
                            <CITA>[56 FR 67215, Dec. 30, 1991. Redesignated at 89 FR 66284, Aug. 15, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>223.370</SECTNO>
                            <SUBJECT>Safety precautions for ammunition and explosives.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>223.370-1</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>(a) This section applies to all acquisitions involving the use of ammunition and explosives, including acquisitions for—</P>
                            <P>(1) Development;</P>
                            <P>(2) Testing;</P>
                            <P>
                                (3) Research;
                                <PRTPAGE P="182"/>
                            </P>
                            <P>(4) Manufacturing;</P>
                            <P>(5) Handling or loading;</P>
                            <P>(6) Assembling;</P>
                            <P>(7) Packaging;</P>
                            <P>(8) Storage;</P>
                            <P>(9) Transportation;</P>
                            <P>(10) Renovation;</P>
                            <P>(11) Demilitarization;</P>
                            <P>(12) Modification;</P>
                            <P>(13) Repair;</P>
                            <P>(14) Disposal;</P>
                            <P>(15) Inspection; or</P>
                            <P>(16) Any other use, including acquisitions requiring the use or the incorporation of materials listed in paragraph (b) of this subsection for initiation, propulsion, or detonation as an integral or component part of an explosive, an ammunition, or explosive end item or weapon system.</P>
                            <P>(b) This section does not apply to acquisitions solely for—</P>
                            <P>(1) Inert components containing no explosives, propellants, or pyrotechnics;</P>
                            <P>(2) Flammable liquids;</P>
                            <P>(3) Acids;</P>
                            <P>(4) Oxidizers;</P>
                            <P>(5) Powdered metals; or</P>
                            <P>(6) Other materials having fire or explosive characteristics.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>223.370-2</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <P>
                                <E T="03">Ammunition and explosives,</E>
                                 as used in this section, is defined in the clause at 252.223-7002, Safety Precautions for Ammunition and Explosives.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>223.370-3</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(a) DoD policy is to ensure that its contractors take reasonable precautions in handling ammunition and explosives so as to minimize the potential for mishaps.</P>
                            <P>(b) This policy is implemented by DoD Manual 4145.26, DoD Contractors' Safety Manual for Ammunition and Explosives, which is incorporated into contracts under which ammunition and explosives are handled. The manual contains mandatory safety requirements for contractors. When work is to be performed on a Government-owned installation, the contracting officer may use the ammunition and explosives regulation of the DoD component or installation as a substitute for, or supplement to, DoD Manual 4145.26, as long as the contract cites the ammunition and explosives regulation of the DoD component or installation.</P>
                            <CITA>[56 FR 36365, July 31, 1991, as amended at 70 FR 73150, Dec. 9, 2005; 88 FR 80466, Nov. 17, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>223.370-4</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>Follow the procedures at PGI 223.370-4.</P>
                            <CITA>[70 FR 73151, Dec. 9, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>223.370-5</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>Use the clauses at 252.223-7002, Safety Precautions for Ammunition and Explosives, and 252.223-7003, Change in Place of Performance—Ammunition and Explosives, in all solicitations and contracts for acquisition to which this section applies.</P>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <RESERVED>Subpart 223.4 [Reserved]</RESERVED>
                    </SUBPART>
                    <SUBPART>
                        <RESERVED>Subpart 223.5 [Reserved]</RESERVED>
                    </SUBPART>
                    <SUBPART>
                        <RESERVED>Subpart 223.70 [Reserved]</RESERVED>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 223.71—Storage, Treatment, and Disposal of Toxic or Hazardous Materials</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>79 FR 58697, Sept. 30, 2014, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>223.7101</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>
                                As used in this subpart, the terms 
                                <E T="03">storage</E>
                                 and 
                                <E T="03">toxic or hazardous materials</E>
                                 are defined in the clause at 252.223-7006, Prohibition on Storage, Treatment, and Disposal of Toxic or Hazardous Materials.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>223.7102</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(a) 10 U.S.C. 2692 prohibits storage, treatment, or disposal on DoD installations of toxic or hazardous materials that are not owned either by DoD or by a member of the armed forces (or a dependent of the member) assigned to or provided military housing on the installation, unless an exception in 223.7104 applies.</P>
                            <P>
                                (b) When storage of toxic or hazardous materials is authorized based on an imminent danger, the storage provided shall be temporary and shall cease once the imminent danger no 
                                <PRTPAGE P="183"/>
                                longer exists. In all other cases of storage or disposal, the storage or disposal shall be terminated as determined by the Secretary of Defense.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>223.7103</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>(a)(1) Storage, treatment, or disposal of toxic or hazardous materials not owned by DoD on a DoD installation is prohibited unless—</P>
                            <P>(i) One or more of the exceptions set forth in 223.7104(a) is met including requisite approvals; or</P>
                            <P>(ii) Secretary of Defense authorization is obtained under the conditions set forth in 223.7104(b).</P>
                            <P>(2) When storage, treatment, or disposal of toxic or hazardous materials not owned by DoD is authorized in accordance with this subpart, the contract shall specify the types and quantities of toxic or hazardous materials that may be temporarily stored, treated, or disposed of in connection with the contract or as a result of the authorized use of a DoD facility or space launch facility. All solicitations and contracts shall specify the conditions under which storage, treatment, or disposal is authorized.</P>
                            <P>(b) If the contracting officer is uncertain as to whether particular activities are prohibited or fall under one of the exceptions in 223.7104, the contracting officer should seek advice from the cognizant office of counsel.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>223.7104</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <P>(a) The prohibition of 10 U.S.C. 2692 does not apply to any of the following:</P>
                            <P>(1) The storage, treatment, or disposal of materials that will be or have been used in connection with an activity of DoD or in connection with a service to be performed on a DoD installation for the benefit of DoD.</P>
                            <P>(2) The storage of strategic and critical materials in the National Defense Stockpile under an agreement for such storage with the Administrator of General Services Administration.</P>
                            <P>(3) The temporary storage or disposal of explosives in order to protect the public or to assist agencies responsible for Federal, State, or local law enforcement in storing or disposing of explosives when no alternative solution is available, if such storage or disposal is made in accordance with an agreement between the Secretary of Defense and the head of the Federal, State, or local agency concerned.</P>
                            <P>(4) The temporary storage or disposal of explosives in order to provide emergency lifesaving assistance to civil authorities.</P>
                            <P>(5) The disposal of excess explosives produced under a DoD contract, if the head of the military department concerned determines, in each case, that an alternative feasible means of disposal is not available to the contractor, taking into consideration public safety, available resources of the contractor, and national defense production requirements.</P>
                            <P>(6) The temporary storage of nuclear materials or nonnuclear classified materials in accordance with an agreement with the Secretary of Energy.</P>
                            <P>(7) The storage of materials that constitute military resources intended to be used during peacetime civil emergencies in accordance with applicable DoD regulations.</P>
                            <P>(8) The temporary storage of materials of other Federal agencies in order to provide assistance and refuge for commercial carriers of such material during a transportation emergency.</P>
                            <P>(9) The storage of any material that is not owned by DoD, if the Secretary of the military department concerned determines that the material is required or generated in connection with the authorized and compatible use of a facility of DoD, including the use of such a facility for testing material or training personnel.</P>
                            <P>(10) The treatment and disposal of any toxic or hazardous materials not owned by DoD, if the Secretary of the military department concerned determines that the material is required or generated in connection with the authorized and compatible use of a facility of that military department and the Secretary enters into a contract or agreement with the prospective user that—</P>
                            <P>(i) Is consistent with the best interest of national defense and environmental security; and</P>
                            <P>
                                (ii) Provides for the prospective user's continued financial and environmental responsibility and liability with regard to the material.
                                <PRTPAGE P="184"/>
                            </P>
                            <P>(11) The storage of any material that is not owned by DoD if the Secretary of the military department concerned determines that the material is required or generated in connection with the use of a space launch facility located on a DoD installation or on other land controlled by the United States.</P>
                            <P>(b) The Secretary of Defense may grant an exception to the prohibition in 10 U.S.C. 2692 when essential to protect the health and safety of the public from imminent danger if the Secretary otherwise determines the exception is essential and if the storage or disposal authorized does not compete with private enterprise.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>223.7105</SECTNO>
                            <SUBJECT>Reimbursement.</SUBJECT>
                            <P>The Secretary of Defense may assess a charge for any storage or disposal provided under this subpart. If a charge is to be assessed, then such assessment shall be identified in the contract with payment to the Government on a reimbursable cost basis.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>223.7106</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the basic or the alternate of the clause at 252.223-7006, Prohibition on Storage, Treatment, and Disposal of Toxic or Hazardous Materials, in all solicitations and contracts which require, may require, or permit contractor access to a DoD installation.</P>
                            <P>(a) Use the basic clause, unless a determination is made under 223.7104(a)(10).</P>
                            <P>(b) Use the alternate I clause when the Secretary of the military department issues a determination under the exception at 223.7104(a)(10).</P>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 223.72—Safeguarding Sensitive Conventional Arms, Ammunition, and Explosives</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>61 FR 7743, Feb. 29, 1996, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>223.7200</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <P>As used in this subpart—</P>
                            <P>
                                <E T="03">Arms, ammunition, and explosives (AA&amp;E)</E>
                                 means those items within the scope of DoD Manual 5100.76, Physical Security of Sensitive Conventional Arms, Ammunition, and Explosives.
                            </P>
                            <CITA>[88 FR 80466, Nov. 17, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>223.7201</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(a) The requirements of DoD Manual 5100.76, Physical Security of Sensitive Conventional Arms, Ammunition, and Explosives, shall be applied to contracts when—</P>
                            <P>(1) AA&amp;E will be provided to the contractor or subcontractor as Government-furnished property; or</P>
                            <P>(2) The principal development, production, manufacture, or purchase of AA&amp;E is for DoD use.</P>
                            <P>(b) The requirements of DoD Manual 5100.76 need not be applied to contracts when—</P>
                            <P>(1) The AA&amp;E to be acquired under the contract is a commercial product within the meaning of FAR 2.101; or</P>
                            <P>(2) The contract will be performed in a Government-owned contractor-operated ammunition production facility. However, if subcontracts issued under such a contract will meet the criteria of paragraph (a) of this section, the requirements of DoD Manual 5100.76 shall apply.</P>
                            <CITA>[61 FR 7743, Feb. 29, 1996, as amended at 88 FR 6583, Jan. 31, 2023; 88 FR 80466, Nov. 17, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>223.7202</SECTNO>
                            <SUBJECT>Preaward responsibilities.</SUBJECT>
                            <P>When an acquisition involves AA&amp;E, technical or requirements personnel shall specify in the purchase request—</P>
                            <P>(a) That AA&amp;E is involved; and</P>
                            <P>(b) Which physical security requirements of DoD Manual 5100.76 apply.</P>
                            <CITA>[61 FR 7743, Feb. 29, 1996, as amended at 88 FR 80466, Nov. 17, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>223.7203</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at 252.223-7007, Safeguarding Sensitive Conventional Arms, Ammunition, and Explosives, in all solicitations and contracts to which DoD Manual 5100.76 applies, in accordance with the policy at 223.7201. Complete paragraph (b) of the clause based on information provided by cognizant technical or requirements personnel.</P>
                            <CITA>[61 FR 7743, Feb. 29, 1996; 61 FR 18195, Apr. 24, 1996; 88 FR 80466, Nov. 17, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <PRTPAGE P="185"/>
                        <HD SOURCE="HED">Subpart 223.73—Minimizing the Use of Materials Containing Hexavalent Chromium</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>76 FR 25575, May 5, 2011, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>223.7300</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <P>
                                <E T="03">Legacy system,</E>
                                 as used in this subpart, means any program that has passed Milestone A in the defense acquisition management system, as defined in DoD Instruction 5000.02.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>223.7301</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>In accordance with the DoD policy memorandum of April 8, 2009, Minimizing the Use of Hexavalent Chromium, it is DoD policy to minimize hexavalent chromium (an anti-corrosive) in items acquired by DoD (deliverables and construction material), due to the serious human health and environmental risks related to its use.</P>
                            <CITA>[86 FR 27280, May 20, 2021]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>223.7302</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>223.7303</SECTNO>
                            <SUBJECT>Prohibition.</SUBJECT>
                            <P>(a) Except as provided in 223.7304 and 223.7305, no contract may include a specification or standard that results in a deliverable or construction material containing more than 0.1 percent hexavalent chromium by weight in any homogeneous material in the deliverable or construction material where proven substitutes are available that provide acceptable performance for the application.</P>
                            <P>(b) This prohibition is in addition to any imposed by the Clean Air Act regardless of the place of performance.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>223.7304</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <P>The prohibition in 223.7303 does not apply to—</P>
                            <P>(a) Legacy systems and their related parts, subsystems, and components that already contain hexavalent chromium. However, alternatives to hexavalent chromium shall be considered by the appropriate official during system modifications, follow-on procurements of legacy systems, or maintenance procedure updates; and</P>
                            <P>(b) Additional sustainment related contracts (e.g., parts, services) for a system in which use of hexavalent chromium was previously approved.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>223.7305</SECTNO>
                            <SUBJECT>Authorization and approval.</SUBJECT>
                            <P>(a) The prohibition in 223.7303 does not apply to critical defense applications if no substitute can meet performance requirements. The DoD policy of April 8, 2009, “Minimizing the Use of Hexavalent Chromium,” contains requirements for weighing hexavalent chromium versus substitutes. DoD Program Managers must consider the following factors—</P>
                            <P>(1) Cost effectiveness of alternative materials or processes;</P>
                            <P>(2) Technical feasibility of alternative materials or processes;</P>
                            <P>(3) Environment, safety, and occupational health risks associated with the use of the hexavalent chromium or substitute materials in each specific application;</P>
                            <P>(4) Achieving a DoD Manufacturing Readiness Level of at least eight for any qualified alternative;</P>
                            <P>(5) Materiel availability of hexavalent chromium and the proposed alternatives over the projected life span of the system; and</P>
                            <P>(6) Corrosion performance difference of alternative materials or processes as determined by agency corrosion subject matter experts.</P>
                            <P>(b) However, unless an exception in 223.7304 applies, the incorporation of hexavalent chromium in items acquired by DoD shall be specifically authorized at a level no lower than a general or flag officer or a member of the Senior Executive Service from the Program Executive Office or equivalent level, in coordination with the component Corrosion Control and Prevention Executive. Follow the procedures in PGI 223.7305.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>223.7306</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>
                                Unless an exception in 223.7304 applies, or use has been authorized in accordance with 223.7305, use the clause at 252.223-7008, Prohibition of Hexavalent Chromium, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, that 
                                <PRTPAGE P="186"/>
                                are for supplies, maintenance and repair services, or construction.
                            </P>
                            <CITA>[76 FR 25575, May 5, 2011, as amended at 78 FR 37986, June 25, 2013; 88 FR 6583, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 223.74—Prohibition on Procurement of Certain Items Containing Perfluoroalkyl or Polyfluoroalkyl Substances</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>88 FR 67606, Sept. 29, 2023, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>223.7400</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>This subpart implements section 322(b), (c), and (d) of the National Defense Authorization Act for Fiscal Year 2020 (Pub. L. 116-92).</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>223.7401</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <P>As used in this subpart—</P>
                            <P>
                                <E T="03">Ocean-going vessel</E>
                                 means a vessel over 59 feet in length owned or operated by DoD or the U.S. Coast Guard, other than vessels that are chartered by the Armed Forces on a time or voyage basis.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>223.7402</SECTNO>
                            <SUBJECT>Prohibition.</SUBJECT>
                            <P>Do not procure any fire-fighting agent that contains in excess of one part per billion perfluoroalkyl substances or polyfluoroalkyl substances. Procurements of fire-fighting agent for use solely onboard ocean-going vessels are exempt from this prohibition.</P>
                            <CITA>[89 FR 20871, Mar. 26, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>223.7403</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>Contracting officers shall not issue a solicitation for any fire-fighting agent that contains perfluoroalkyl or polyfluoroalkyl substances in excess of one part per billion, unless the requiring activity provides documentation of the exemption at 223.7402. The contracting officer shall maintain the documentation in the contract file.</P>
                            <CITA>[89 FR 20871, Mar. 26, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>223.7404</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at 252.223-7009, Prohibition of Procurement of Fluorinated Fire-Fighting Agent for Use on Military Installations, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, relating to fire-fighting on military installations.</P>
                            <CITA>[88 FR 67606, Sept. 29, 2023, as amended at 89 FR 20871, Mar. 26, 2024]</CITA>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 224</EAR>
                    <HD SOURCE="HED">PART 224—PROTECTION OF PRIVACY AND FREEDOM OF INFORMATION</HD>
                    <CONTENTS>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 224.1—Protection of Individual Privacy</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>224.103</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 224.2—Freedom of Information Act</HD>
                            <SECTNO>224.203</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36367, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 224.1—Protection of Individual Privacy</HD>
                        <SECTION>
                            <SECTNO>224.103</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>(b)(2) DoD rules and regulations are contained in DoDI 5400.11, DoD Privacy and Civil Liberties Programs; DoD 5400.11-R, Department of Defense Privacy Program; and DoDM 5400.11, DoD Privacy and Civil Liberties Programs: Breach Preparedness and Response Plan.</P>
                            <CITA>[88 FR 37794, June 9, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 224.2—Freedom of Information Act</HD>
                        <SECTION>
                            <SECTNO>224.203</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(a) DoD implementation is in DoDD 5400.7, DoD Freedom of Information Act Program, and DoD 5400.7-R, DoD Freedom of Information Act Program.</P>
                            <CITA>[56 FR 36367, July 31, 1991. Redesignated at 62 FR 34122, June 24, 1997]</CITA>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 225</EAR>
                    <HD SOURCE="HED">PART 225—FOREIGN ACQUISITION</HD>
                    <CONTENTS>
                        <SECHD>Sec.</SECHD>
                        <SECTNO>225.001</SECTNO>
                        <SUBJECT>General.</SUBJECT>
                        <SECTNO>225.003</SECTNO>
                        <SUBJECT>
                            Definitions.
                            <PRTPAGE P="187"/>
                        </SUBJECT>
                        <SECTNO>225.070</SECTNO>
                        <SUBJECT>Reporting of acquisition of end products manufactured outside the United States.</SUBJECT>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 225.1—Buy American—Supplies</HD>
                            <SECTNO>225.101</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>225.103</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <SECTNO>225.106</SECTNO>
                            <SUBJECT>Determining reasonableness of cost.</SUBJECT>
                            <SECTNO>225.170</SECTNO>
                            <SUBJECT>Acquisition from or through other Government agencies.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 225.2—Buy American—Construction Materials</HD>
                            <SECTNO>225.202</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <SECTNO>225.206</SECTNO>
                            <SUBJECT>Noncompliance.</SUBJECT>
                            <SECTNO>225.206</SECTNO>
                            <SUBJECT>Noncompliance.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 225.3—Contracts Performed Outside the United States</HD>
                            <SECTNO>225.301</SECTNO>
                            <SUBJECT>Contractor personnel in a designated operational area or supporting a diplomatic or consular mission outside the United States.</SUBJECT>
                            <SECTNO>225.301-1</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>225.301-4</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <SECTNO>225.302</SECTNO>
                            <SUBJECT>Contractors performing private security functions outside the United States.</SUBJECT>
                            <SECTNO>225.302-6</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <SECTNO>225.370</SECTNO>
                            <SUBJECT>Contracts requiring performance or delivery in a foreign country.</SUBJECT>
                            <SECTNO>225.371</SECTNO>
                            <SUBJECT>Contractor personnel supporting U.S. Armed Forces deployed outside the United States.</SUBJECT>
                            <SECTNO>225.371-1</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>225.371-2</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <SECTNO>225.371-3</SECTNO>
                            <SUBJECT>Government support.</SUBJECT>
                            <SECTNO>225.371-4</SECTNO>
                            <SUBJECT>Law of war training.</SUBJECT>
                            <SECTNO>225.371-5</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <SECTNO>225.372</SECTNO>
                            <SUBJECT>Antiterrorism/force protection.</SUBJECT>
                            <SECTNO>225.372-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>225.372-2</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <SECTNO>225.373</SECTNO>
                            <SUBJECT>Contract administration in support of contingency operations.</SUBJECT>
                            <SECTNO>225.374</SECTNO>
                            <SUBJECT>Use of electronic business tools.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 225.4—Trade Agreements</HD>
                            <SECTNO>225.401</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <SECTNO>225.401-70</SECTNO>
                            <SUBJECT>End products subject to trade agreements.</SUBJECT>
                            <SECTNO>225.401-71</SECTNO>
                            <SUBJECT>Products or services in support of operations in Afghanistan.</SUBJECT>
                            <SECTNO>225.402</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>225.403</SECTNO>
                            <SUBJECT>World Trade Organization Government Procurement Agreement and Free Trade Agreements.</SUBJECT>
                            <SECTNO>225.408</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 225.5—Evaluating Foreign Offers—Supply Contracts</HD>
                            <SECTNO>225.502</SECTNO>
                            <SUBJECT>Application.</SUBJECT>
                            <SECTNO>225.503</SECTNO>
                            <SUBJECT>Group offers.</SUBJECT>
                            <SECTNO>225.504</SECTNO>
                            <SUBJECT>Evaluation examples.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 225.7—Prohibited Sources</HD>
                            <SECTNO>225.701</SECTNO>
                            <SUBJECT>Restrictions administered by the Department of the Treasury on acquisitions of supplies or services from prohibited sources.</SUBJECT>
                            <SECTNO>225.701-70</SECTNO>
                            <SUBJECT>Exception.</SUBJECT>
                            <SECTNO>225.770</SECTNO>
                            <SUBJECT>Prohibition on acquisition of certain items from Communist Chinese military companies.</SUBJECT>
                            <SECTNO>225.770-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>225.770-2</SECTNO>
                            <SUBJECT>Prohibition.</SUBJECT>
                            <SECTNO>225.770-3</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <SECTNO>225.770-4</SECTNO>
                            <SUBJECT>Identifying items covered by the USML or the 600 series of the CCL.</SUBJECT>
                            <SECTNO>225.770-5</SECTNO>
                            <SUBJECT>Waiver of prohibition.</SUBJECT>
                            <SECTNO>225.771</SECTNO>
                            <SUBJECT>Prohibition on contracting or subcontracting with a firm that is owned or controlled by the government of a country that is a state sponsor of terrorism.</SUBJECT>
                            <SECTNO>225.771-0</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>225.771-1</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <SECTNO>225.771-2</SECTNO>
                            <SUBJECT>Prohibition.</SUBJECT>
                            <SECTNO>225.771-3</SECTNO>
                            <SUBJECT>Notification.</SUBJECT>
                            <SECTNO>225.771-4</SECTNO>
                            <SUBJECT>Waiver of prohibition.</SUBJECT>
                            <SECTNO>225.771-5</SECTNO>
                            <SUBJECT>Solicitation provision.</SUBJECT>
                            <SECTNO>225.772</SECTNO>
                            <SUBJECT>Prohibition on acquisition of certain foreign commercial satellite services.</SUBJECT>
                            <SECTNO>225.772-0</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>225.772-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>225.772-2</SECTNO>
                            <SUBJECT>Prohibitions.</SUBJECT>
                            <SECTNO>225.772-3</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>225.772-4</SECTNO>
                            <SUBJECT>Exception.</SUBJECT>
                            <SECTNO>225.772-5</SECTNO>
                            <SUBJECT>Solicitation provision and contract clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 225.8—Other International Agreements and Coordination</HD>
                            <SECTNO>225.802</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>225.802-70</SECTNO>
                            <SUBJECT>Contracts for performance outside the United States and Canada.</SUBJECT>
                            <SECTNO>225.802-71</SECTNO>
                            <SUBJECT>End use certificates.</SUBJECT>
                            <SECTNO>225.870</SECTNO>
                            <SUBJECT>Contracting with Canadian contractors.</SUBJECT>
                            <SECTNO>225.870-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>225.870-2</SECTNO>
                            <SUBJECT>Solicitation of Canadian contractors.</SUBJECT>
                            <SECTNO>225.870-3</SECTNO>
                            <SUBJECT>Submission of offers.</SUBJECT>
                            <SECTNO>225.870-4</SECTNO>
                            <SUBJECT>Contracting procedures.</SUBJECT>
                            <SECTNO>225.870-5</SECTNO>
                            <SUBJECT>Contract administration.</SUBJECT>
                            <SECTNO>225.870-6</SECTNO>
                            <SUBJECT>Termination procedures.</SUBJECT>
                            <SECTNO>225.870-7</SECTNO>
                            <SUBJECT>Acceptance of Canadian supplies.</SUBJECT>
                            <SECTNO>225.870-8</SECTNO>
                            <SUBJECT>Industrial security.</SUBJECT>
                            <SECTNO>225.871</SECTNO>
                            <SUBJECT>North Atlantic Treaty Organization (NATO) cooperative projects.</SUBJECT>
                            <SECTNO>225.871-1</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>225.871-2</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>225.871-3</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>225.871-4</SECTNO>
                            <SUBJECT>Statutory waivers.</SUBJECT>
                            <SECTNO>225.871-5</SECTNO>
                            <SUBJECT>Directed subcontracting.</SUBJECT>
                            <SECTNO>225.871-6</SECTNO>
                            <SUBJECT>Disposal of property.</SUBJECT>
                            <SECTNO>225.871-7</SECTNO>
                            <SUBJECT>Congressional notification.</SUBJECT>
                            <SECTNO>225.872</SECTNO>
                            <SUBJECT>Contracting with qualifying country sources.</SUBJECT>
                            <SECTNO>225.872-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>225.872-2</SECTNO>
                            <SUBJECT>
                                Applicability.
                                <PRTPAGE P="188"/>
                            </SUBJECT>
                            <SECTNO>225.872-3</SECTNO>
                            <SUBJECT>Solicitation procedures.</SUBJECT>
                            <SECTNO>225.872-4</SECTNO>
                            <SUBJECT>Individual determinations.</SUBJECT>
                            <SECTNO>225.872-5</SECTNO>
                            <SUBJECT>Contract administration.</SUBJECT>
                            <SECTNO>225.872-6</SECTNO>
                            <SUBJECT>Request for audit services.</SUBJECT>
                            <SECTNO>225.872-7</SECTNO>
                            <SUBJECT>Industrial security for qualifying countries.</SUBJECT>
                            <SECTNO>225.872-8</SECTNO>
                            <SUBJECT>Subcontracting with qualifying country sources.</SUBJECT>
                            <SECTNO>225.873</SECTNO>
                            <SUBJECT>Waiver of United Kingdom commercial exploitation levies.</SUBJECT>
                            <SECTNO>225.873-1</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>225.873-2</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 225.9—Customs and Duties</HD>
                            <SECTNO>225.900-70</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <SECTNO>225.901</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>225.902</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>225.903</SECTNO>
                            <SUBJECT>Exempted supplies.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 225.10—Additional Foreign Acquisition Regulations</HD>
                            <SECTNO>225.1070</SECTNO>
                            <SUBJECT>Clause deviations in overseas contracts.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 225.11—Solicitation Provisions and Contract Clauses</HD>
                            <SECTNO>225.1100</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>225.1101</SECTNO>
                            <SUBJECT>Acquisition of supplies.</SUBJECT>
                            <SECTNO>225.1103</SECTNO>
                            <SUBJECT>Other provisions and clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 225.70—Authorization Acts, Appropriations Acts, and Other Statutory Restrictions on Foreign Acquisition</HD>
                            <SECTNO>225.7000</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>225.7001</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>225.7002</SECTNO>
                            <SUBJECT>Restrictions on food, clothing, fabrics, hand or measuring tools, and flags.</SUBJECT>
                            <SECTNO>225.7002-1</SECTNO>
                            <SUBJECT>Restrictions.</SUBJECT>
                            <SECTNO>225.7002-2</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <SECTNO>225.7002-3</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <SECTNO>225.7003</SECTNO>
                            <SUBJECT>Restrictions on acquisition of specialty metals.</SUBJECT>
                            <SECTNO>225.7003-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>225.7003-2</SECTNO>
                            <SUBJECT>Restrictions.</SUBJECT>
                            <SECTNO>225.7003-3</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <SECTNO>225.7003-4</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>225.7003-5</SECTNO>
                            <SUBJECT>Solicitation provision and contract clauses.</SUBJECT>
                            <SECTNO>225.7004</SECTNO>
                            <SUBJECT>Restrictions on the procurement of goods other than U.S. goods.</SUBJECT>
                            <SECTNO>225.7004-0</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>225.7004-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>225.7004-2</SECTNO>
                            <SUBJECT>Restrictions.</SUBJECT>
                            <SECTNO>225.7004-3</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <SECTNO>225.7004-4</SECTNO>
                            <SUBJECT>Implementation of restriction on certain naval vessel components.</SUBJECT>
                            <SECTNO>225.7004-5</SECTNO>
                            <SUBJECT>Additional restrictions on anchor and mooring chain.</SUBJECT>
                            <SECTNO>225.7004-6</SECTNO>
                            <SUBJECT>Waiver of restrictions.</SUBJECT>
                            <SECTNO>225.7004-7</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <SECTNO>225.7005—225.7008</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>225.7009</SECTNO>
                            <SUBJECT>Restriction on ball and roller bearings.</SUBJECT>
                            <SECTNO>225.7009-1</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>225.7009-2</SECTNO>
                            <SUBJECT>Restriction.</SUBJECT>
                            <SECTNO>225.7009-3</SECTNO>
                            <SUBJECT>Exception.</SUBJECT>
                            <SECTNO>225.7009-4</SECTNO>
                            <SUBJECT>Waiver.</SUBJECT>
                            <SECTNO>225.7009-5</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <SECTNO>225.7010</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>225.7011</SECTNO>
                            <SUBJECT>Restriction on carbon, alloy, and armor steel plate.</SUBJECT>
                            <SECTNO>225.7011-1</SECTNO>
                            <SUBJECT>Restriction.</SUBJECT>
                            <SECTNO>225.7011-2</SECTNO>
                            <SUBJECT>Waiver.</SUBJECT>
                            <SECTNO>225.7011-3</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <SECTNO>225.7012</SECTNO>
                            <SUBJECT>Restriction on supercomputers.</SUBJECT>
                            <SECTNO>225.7012-1</SECTNO>
                            <SUBJECT>Restriction.</SUBJECT>
                            <SECTNO>225.7012-2</SECTNO>
                            <SUBJECT>Waiver.</SUBJECT>
                            <SECTNO>225.7012-3</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <SECTNO>225.7013</SECTNO>
                            <SUBJECT>Restrictions on construction or repair of vessels in foreign shipyards.</SUBJECT>
                            <SECTNO>225.7013-0</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>225.7013-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>225.7013-2</SECTNO>
                            <SUBJECT>Restrictions.</SUBJECT>
                            <SECTNO>225.7014</SECTNO>
                            <SUBJECT>Restrictions on military construction.</SUBJECT>
                            <SECTNO>225.7015</SECTNO>
                            <SUBJECT>Restriction on overseas architect-engineer services.</SUBJECT>
                            <SECTNO>225.7017</SECTNO>
                            <SUBJECT>Utilization of domestic photovoltaic devices.</SUBJECT>
                            <SECTNO>225.7017-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>225.7017-2</SECTNO>
                            <SUBJECT>Restriction.</SUBJECT>
                            <SECTNO>225.7017-3</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <SECTNO>225.7017-4</SECTNO>
                            <SUBJECT>Solicitation provision and contract clause.</SUBJECT>
                            <SECTNO>225.7018</SECTNO>
                            <SUBJECT>Restriction on acquisition of certain magnets, tantalum, and tungsten.</SUBJECT>
                            <SECTNO>225.7018-0</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>225.7018-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>225.7018-2</SECTNO>
                            <SUBJECT>Restriction.</SUBJECT>
                            <SECTNO>225.7018-3</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <SECTNO>225.7018-4</SECTNO>
                            <SUBJECT>Nonavailability determination.</SUBJECT>
                            <SECTNO>225.7018-5</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <SECTNO>225.7019</SECTNO>
                            <SUBJECT>Prohibition on use of certain energy sourced from inside the Russian Federation.</SUBJECT>
                            <SECTNO>225.7019-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>225.7019-2</SECTNO>
                            <SUBJECT>Prohibition.</SUBJECT>
                            <SECTNO>225.7019-3</SECTNO>
                            <SUBJECT>Waiver.</SUBJECT>
                            <SECTNO>225.7019-4</SECTNO>
                            <SUBJECT>Solicitation provision and contract clause.</SUBJECT>
                            <SECTNO>225.7020</SECTNO>
                            <SUBJECT>Prohibition on contracting with the Maduro regime.</SUBJECT>
                            <SECTNO>225.7020-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>225.7020-2</SECTNO>
                            <SUBJECT>Prohibition.</SUBJECT>
                            <SECTNO>225.7020-3</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <SECTNO>225.7020-4</SECTNO>
                            <SUBJECT>Joint determination.</SUBJECT>
                            <SECTNO>225.7020-5</SECTNO>
                            <SUBJECT>Solicitation provision and contract clause.</SUBJECT>
                            <SECTNO>225.7021</SECTNO>
                            <SUBJECT>Disclosure requirements for employment transparency regarding individuals who perform work in the People's Republic of China.</SUBJECT>
                            <SECTNO>225.7021-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>225.7021-2</SECTNO>
                            <SUBJECT>Restrictions.</SUBJECT>
                            <SECTNO>225.7021-3</SECTNO>
                            <SUBJECT>National security waiver of disclosure.</SUBJECT>
                            <SECTNO>225.7021-4</SECTNO>
                            <SUBJECT>
                                Solicitation provision and contract clause.
                                <PRTPAGE P="189"/>
                            </SUBJECT>
                            <SECTNO>225.7022</SECTNO>
                            <SUBJECT>Prohibition on certain procurements from the Xinjiang Uyghur Autonomous Region.</SUBJECT>
                            <SECTNO>225.7022-1</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>225.7022-2</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>225.7022-3</SECTNO>
                            <SUBJECT>Prohibition.</SUBJECT>
                            <SECTNO>225.7022-4</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <SECTNO>225.7022-5</SECTNO>
                            <SUBJECT>Solicitation provision and contract clause.</SUBJECT>
                            <SECTNO>225.7023</SECTNO>
                            <SUBJECT>Restriction on acquisition of personal protective equipment and certain other items from non-allied foreign nations.</SUBJECT>
                            <SECTNO>225.7023-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>225.7023-2</SECTNO>
                            <SUBJECT>Restriction.</SUBJECT>
                            <SECTNO>225.7023-3</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <SECTNO>225.7023-4</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <SECTNO>225.7024</SECTNO>
                            <SUBJECT>Restriction on acquisition of fuel for overseas contingency operations.</SUBJECT>
                            <SECTNO>225.7024-1</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>225.7024-2</SECTNO>
                            <SUBJECT>Prohibition.</SUBJECT>
                            <SECTNO>225.7024-3</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>225.7024-4</SECTNO>
                            <SUBJECT>Solicitation provision.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 225.71—Other Restrictions on Foreign Acquisition</HD>
                            <SECTNO>225.7100</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>225.7101</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>225.7102</SECTNO>
                            <SUBJECT>Forgings.</SUBJECT>
                            <SECTNO>225.7102-1</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>225.7102-2</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <SECTNO>225.7102-3</SECTNO>
                            <SUBJECT>Waiver.</SUBJECT>
                            <SECTNO>225.7102-4</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 225.72—Reporting Contract Performance Outside the United States</HD>
                            <SECTNO>225.7201</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>225.7202</SECTNO>
                            <SUBJECT>Exception.</SUBJECT>
                            <SECTNO>225.7203</SECTNO>
                            <SUBJECT>Contracting officer distribution of reports.</SUBJECT>
                            <SECTNO>225.7204</SECTNO>
                            <SUBJECT>Solicitation provision and contract clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 225.73—Acquisitions for Foreign Military Sales</HD>
                            <SECTNO>225.7300</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>225.7301</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>225.7301-1</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>225.7301-2</SECTNO>
                            <SUBJECT>Solicitation approval for sole source contracts.</SUBJECT>
                            <SECTNO>225.7302</SECTNO>
                            <SUBJECT>Preparation of letter of offer and acceptance.</SUBJECT>
                            <SECTNO>225.7303</SECTNO>
                            <SUBJECT>Pricing acquisitions for FMS.</SUBJECT>
                            <SECTNO>225.7303-1</SECTNO>
                            <SUBJECT>Contractor sales to other foreign customers.</SUBJECT>
                            <SECTNO>225.7303-2</SECTNO>
                            <SUBJECT>Cost of doing business with a foreign government or an international organization.</SUBJECT>
                            <SECTNO>225.7303-3</SECTNO>
                            <SUBJECT>Government-to-government agreements.</SUBJECT>
                            <SECTNO>225.7303-4</SECTNO>
                            <SUBJECT>Contingent fees.</SUBJECT>
                            <SECTNO>225.7303-5</SECTNO>
                            <SUBJECT>Acquisitions wholly paid for from nonrepayable funds.</SUBJECT>
                            <SECTNO>225.7304</SECTNO>
                            <SUBJECT>FMS customer involvement.</SUBJECT>
                            <SECTNO>225.7305</SECTNO>
                            <SUBJECT>Limitation of liability.</SUBJECT>
                            <SECTNO>225.7306</SECTNO>
                            <SUBJECT>Offset arrangements.</SUBJECT>
                            <SECTNO>225.7307</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <RESERVED>Subpart 225.74 [Reserved]</RESERVED>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 225.75—Balance of Payments Program</HD>
                            <SECTNO>225.7500</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>225.7501</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>225.7502</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>225.7503</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 225.76—Secondary Arab Boycott of Israel</HD>
                            <SECTNO>225.7601</SECTNO>
                            <SUBJECT>Restriction.</SUBJECT>
                            <SECTNO>225.7602</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>225.7603</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <SECTNO>225.7604</SECTNO>
                            <SUBJECT>Waivers.</SUBJECT>
                            <SECTNO>225.7605</SECTNO>
                            <SUBJECT>Solicitation provision.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 225.77—Acquisitions in Support of Operations in Afghanistan</HD>
                            <SECTNO>225.7700</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>225.7701</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>225.7702</SECTNO>
                            <SUBJECT>Acquisitions not subject to the enhanced authority to acquire products or services from Afghanistan.</SUBJECT>
                            <SECTNO>225.7702-1</SECTNO>
                            <SUBJECT>Acquisition of small arms.</SUBJECT>
                            <SECTNO>225.7702-2</SECTNO>
                            <SUBJECT>Acquisition of uniform components for the Afghan military or the Afghan police.</SUBJECT>
                            <SECTNO>225.7703</SECTNO>
                            <SUBJECT>Enhanced authority to acquire products or services from Afghanistan.</SUBJECT>
                            <SECTNO>225.7703-1</SECTNO>
                            <SUBJECT>Acquisition procedures.</SUBJECT>
                            <SECTNO>225.7703-2</SECTNO>
                            <SUBJECT>Determination requirements.</SUBJECT>
                            <SECTNO>225.7703-3</SECTNO>
                            <SUBJECT>Evaluating offers.</SUBJECT>
                            <SECTNO>225.7703-4</SECTNO>
                            <SUBJECT>Solicitation provisions and contract clauses.</SUBJECT>
                            <SECTNO>225.7704</SECTNO>
                            <SUBJECT>Acquisitions of products and services from South Caucasus/Central and South Asian (SC/CASA) state in support of operations in Afghanistan.</SUBJECT>
                            <SECTNO>225.7704-1</SECTNO>
                            <SUBJECT>Applicability of trade agreements.</SUBJECT>
                            <SECTNO>225.7704-2</SECTNO>
                            <SUBJECT>Applicability of Balance of Payments Program.</SUBJECT>
                            <SECTNO>225.7704-3</SECTNO>
                            <SUBJECT>Solicitation provisions and contract clauses.</SUBJECT>
                            <SECTNO>225.7705</SECTNO>
                            <SUBJECT>Prohibition on use of funds for contracts of certain programs and projects in Afghanistan that cannot be safely accessed.</SUBJECT>
                            <SECTNO>225.7705-1</SECTNO>
                            <SUBJECT>Prohibition.</SUBJECT>
                            <SECTNO>225.7705-2</SECTNO>
                            <SUBJECT>Waiver of prohibition.</SUBJECT>
                            <SECTNO>225.7705-3</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 225.78—Acquisitions in Support of Geographic Combatant Command's Theater Security Cooperation Efforts</HD>
                            <SECTNO>225.7801</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <PRTPAGE P="190"/>
                            <HD SOURCE="HED">Subpart 225.79—Export Control</HD>
                            <SECTNO>225.7900</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>225.7901</SECTNO>
                            <SUBJECT>Export-controlled items.</SUBJECT>
                            <SECTNO>225.7901-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>225.7901-2</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>225.7901-3</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>225.7901-4</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <SECTNO>225.7902</SECTNO>
                            <SUBJECT>Defense Trade Cooperation Treaties.</SUBJECT>
                            <SECTNO>225.7902-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>225.7902-2</SECTNO>
                            <SUBJECT>Purpose.</SUBJECT>
                            <SECTNO>225.7902-3</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>225.7902-4</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>225.7902-5</SECTNO>
                            <SUBJECT>Solicitation provision and contract clause.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36367, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SECTION>
                        <SECTNO>225.001</SECTNO>
                        <SUBJECT>General.</SUBJECT>
                        <P>For guidance on evaluating offers of foreign end products, see PGI 225.001.</P>
                        <CITA>[70 FR 73154, Dec. 9, 2005]</CITA>
                    </SECTION>
                    <SECTION>
                        <SECTNO>225.003</SECTNO>
                        <SUBJECT>Definitions.</SUBJECT>
                        <P>As used in this part—</P>
                        <P>
                            <E T="03">600 series of the Commerce Control List</E>
                             means the series of 5-character export control classification numbers (ECCNs) of the Commerce Control List of the Export Administration Regulations in 15 CFR part 774, supplement no. 1, that have a “6” as the third character. The 600 series constitutes the munitions and munitions-related ECCNs within the larger Commerce Control List. (See definition of “600 series” in 15 CFR 772.)
                        </P>
                        <P>
                            <E T="03">Caribbean Basin country end product</E>
                             includes petroleum or any product derived from petroleum.
                        </P>
                        <P>
                            <E T="03">Communist Chinese military company</E>
                             means any entity, regardless of geographic location, that is—
                        </P>
                        <P>(1) A part of the commercial or defense industrial base of the People's Republic of China (including a subsidiary or affiliate of such entity); or</P>
                        <P>(2) Owned or controlled by, or affiliated with, an element of the Government or armed forces of the People's Republic of China.</P>
                        <P>
                            <E T="03">Defense equipment</E>
                             means any equipment, item of supply, component, or end product purchased by DoD.
                        </P>
                        <P>
                            <E T="03">Domestic concern</E>
                             means—
                        </P>
                        <P>(1) A concern incorporated in the United States (including a subsidiary that is incorporated in the United States, even if the parent corporation is a foreign concern; or</P>
                        <P>(2) An unincorporated concern having its principal place of business in the United States.</P>
                        <P>
                            <E T="03">Domestic end product</E>
                             means—
                        </P>
                        <P>(1) For an end product that does not consist wholly or predominantly of iron or steel or a combination of both—</P>
                        <P>(i) An unmanufactured end product mined or produced in the United States; or</P>
                        <P>(ii) An end product manufactured in the United States if—</P>
                        <P>(A) The cost of its qualifying country components and its components that are mined, produced, or manufactured in the United States exceeds 60 percent of the cost of all its components, except that the percentage will be 65 percent for items delivered in calendar years 2024 through 2028 and 75 percent for items delivered starting in calendar year 2029, unless an alternate percentage is established for a contract in accordance with FAR 25.101(d); or award is made before January 1, 2030, for a foreign end product that exceeds 55 percent domestic content (see 225.103(b)(ii)). The cost of components includes transportation costs to the place of incorporation into the end product and U.S. duty (whether or not a duty-free entry certificate is issued). Components of unknown origin are treated as foreign. Scrap generated, collected, and prepared for processing in the United States is considered domestic. A component is considered to have been mined, produced, or manufactured in the United States (regardless of its source in fact) if the end product in which it is incorporated is manufactured in the United States and the component is of a class or kind for which the Government has determined that—</P>
                        <P>
                            (
                            <E T="03">1</E>
                            ) Sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States; or
                        </P>
                        <P>
                            (
                            <E T="03">2</E>
                            ) It is inconsistent with the public interest to apply the restrictions of the Buy American statute; or
                        </P>
                        <P>
                            (B) The end product is a commercially available off-the-shelf (COTS) item; or
                            <PRTPAGE P="191"/>
                        </P>
                        <P>(2) For an end product that consists wholly or predominantly of iron or steel or a combination of both, an end product manufactured in the United States, if the cost of iron and steel not produced in the United States or a qualifying country constitutes less than 5 percent of the cost of all the components used in the end product (produced in the United States or a qualifying country means that all manufacturing processes of the iron or steel must take place in the United States or a qualifying country, except metallurgical processes involving refinement of steel additives). The cost of iron and steel not produced in the United States or a qualifying country includes but is not limited to the cost of iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings, not produced in the United States or a qualifying country, utilized in the manufacture of the end product and a good faith estimate of the cost of all iron or steel components not produced in the United States or a qualifying country, excluding COTS fasteners. Iron or steel components of unknown origin are treated as foreign. If the end product contains multiple components, the cost of all the materials used in such end product is calculated in accordance with the explanation of cost of components in paragraph (1)(ii)(A) of this definition.</P>
                        <P>
                            <E T="03">Eligible product</E>
                             means, instead of the definition in FAR 25.003—
                        </P>
                        <P>(1) A foreign end product that—</P>
                        <P>(i) Is in a category listed in 225.401-70; and</P>
                        <P>(ii) Is not subject to discriminatory treatment, due to the applicability of a trade agreement to a particular acquisition;</P>
                        <P>(2) A foreign construction material that is not subject to discriminatory treatment, due to the applicability of a trade agreement to a particular acquisition; or</P>
                        <P>(3) A foreign service that is not subject to discriminatory treatment, due to the applicability of a trade agreement to a particular acquisition.</P>
                        <P>
                            <E T="03">Foreign concern</E>
                             means any concern other than a domestic concern.
                        </P>
                        <P>
                            <E T="03">Free Trade Agreement country</E>
                             does not include Oman.
                        </P>
                        <P>
                            <E T="03">Nonqualifying country</E>
                             means a country other than the United States or a qualifying country.
                        </P>
                        <P>
                            <E T="03">Nonqualifying country component</E>
                             means a component mined, produced, or manufactured in a nonqualifying country.
                        </P>
                        <P>
                            <E T="03">Qualifying country</E>
                             means a country with a reciprocal defense procurement memorandum of understanding or international agreement with the United States in which both countries agree to remove barriers to purchases of supplies produced in the other country or services performed by sources of the other country, and the memorandum or agreement complies, where applicable, with the requirements of section 36 of the Arms Export Control Act (22 U.S.C. 2776) and with 10 U.S.C. 2457. Accordingly, the following are qualifying countries:
                        </P>
                        <EXTRACT>
                            <SCOL2>
                                <LI>Australia</LI>
                                <LI>Austria</LI>
                                <LI>Belgium</LI>
                                <LI>Canada</LI>
                                <LI>Czech Republic</LI>
                                <LI>Denmark</LI>
                                <LI>Egypt</LI>
                                <LI>Estonia</LI>
                                <LI>Finland</LI>
                                <LI>France</LI>
                                <LI>Germany</LI>
                                <LI>Greece</LI>
                                <LI>Israel</LI>
                                <LI>Italy</LI>
                                <LI>Japan</LI>
                                <LI>Latvia</LI>
                                <LI>Lithuania</LI>
                                <LI>Luxembourg</LI>
                                <LI>Netherlands</LI>
                                <LI>Norway</LI>
                                <LI>Poland</LI>
                                <LI>Portugal</LI>
                                <LI>Slovenia</LI>
                                <LI>Spain</LI>
                                <LI>Sweden</LI>
                                <LI>Switzerland</LI>
                                <LI>Turkey</LI>
                                <LI>United Kingdom of Great Britain and Northern Ireland.</LI>
                            </SCOL2>
                        </EXTRACT>
                        <P>
                            <E T="03">Qualifying country component</E>
                             means a component mined, produced, or manufactured in a qualifying country.
                        </P>
                        <P>
                            <E T="03">Qualifying country end product</E>
                             means—
                        </P>
                        <P>(1) An unmanufactured end product mined or produced in a qualifying country; or</P>
                        <P>(2) An end product manufactured in a qualifying country if—:</P>
                        <P>(i) The cost of the following types of components exceeds 60 percent of the cost of all its components, except that the percentage will be 65 percent for items delivered in calendar years 2024 through 2028 and 75 percent for items delivered starting in calendar year 2029, unless an alternate percentage is established for a contract:</P>
                        <P>(A) Components mined, produced, or manufactured in a qualifying country.</P>
                        <P>
                            (B) Components mined, produced, or manufactured in the United States.
                            <PRTPAGE P="192"/>
                        </P>
                        <P>(C) Components of foreign origin of a class or kind for which the Government has determined that sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States. Components of unknown origin are treated as foreign; or</P>
                        <P>
                            (ii) The end product is a COTS item.
                            <E T="03">Qualifying country end product</E>
                             is also defined in the clause at 252.225-7021, Trade Agreements.
                        </P>
                        <P>
                            <E T="03">Qualifying country offer</E>
                             means an offer of a qualifying country end product, including the price of transportation to destination.
                        </P>
                        <P>
                            <E T="03">Source,</E>
                             when restricted by words such as foreign, domestic, or qualifying country, means the actual manufacturer or producer of the end product or component.
                        </P>
                        <P>
                            <E T="03">South Caucasus/Central and South Asian (SC/CASA) state</E>
                             means Armenia, Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, Pakistan, Tajikistan, Turkmenistan, or Uzbekistan.
                        </P>
                        <P>
                            <E T="03">South Caucasus/Central and South Asian (SC/CASA) state construction material</E>
                             means construction material that—
                        </P>
                        <P>(1) Is wholly the growth, product, or manufacture of an SC/CASA state; or</P>
                        <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in an SC/CASA state into a new and different construction material distinct from the material from which it was transformed.</P>
                        <P>
                            <E T="03">South Caucasus/Central and South Asian (SC/CASA) state end product</E>
                             means an article that—
                        </P>
                        <P>(1) Is wholly the growth, product, or manufacture of an SC/CASA state; or</P>
                        <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in an SC/CASA state into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product, includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                        <P>
                            <E T="03">United States Munitions List</E>
                             means the munitions list of the International Traffic in Arms Regulation in 22 CFR part 121.
                        </P>
                        <CITA>[68 FR 15618, Mar. 31, 2003, as amended at 69 FR 1927, Jan. 13, 2004; 70 FR 73153, Dec. 9, 2005; 73 FR 76971, Dec. 18, 2008; 74 FR 37651, July 29, 2009; 75 FR 34945, June 21, 2010; 75 FR 81916, Dec. 29, 2010; 77 FR 35880, June 15, 2012; 77 FR 38737, June 29, 2012; 77 FR 76942, Dec. 31, 2012; 81 FR 50651, Aug. 2, 2016; 81 FR 93840, Dec. 22, 2016; 82 FR 61484, Dec. 28, 2017; 83 FR 66071, Dec. 21, 2018; 87 FR 15816, Mar. 18, 2022; 87 FR 37443, June 23, 2022; 89 FR 11954, Feb. 15, 2024]</CITA>
                    </SECTION>
                    <SECTION>
                        <SECTNO>225.070</SECTNO>
                        <SUBJECT>Reporting of acquisition of end products manufactured outside the United States.</SUBJECT>
                        <P>Follow the procedures at PGI 225.070 for entering the data on the acquisition of end products manufactured outside the United States.</P>
                        <CITA>[79 FR 11342, Feb. 28, 2014]</CITA>
                    </SECTION>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 225.1—Buy American—Supplies</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>68 FR 15618, Mar. 31, 2003, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>225.101</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>(a) For DoD, the following two-part test determines whether a manufactured end product is a domestic end product:</P>
                            <P>(i) The end product is manufactured in the United States; and</P>
                            <P>(ii)(A) Except for an end product that consists wholly or predominantly of iron or steel or a combination of both, the cost of its U.S. and qualifying country components exceeds 60 percent of the cost of all its components, except that the percentage will be 65 percent for items delivered in calendar years 2024 through 2028 and 75 percent for items delivered starting in calendar year 2029, but see paragraph (d) of this section. This test is applied to end products only and not to individual components.</P>
                            <P>
                                (B) For an end product that consists wholly or predominantly of iron or steel or a combination of both, the cost of iron and steel not produced in the 
                                <PRTPAGE P="193"/>
                                United States or a qualifying country must constitute less than 5 percent of the cost of all the components used in the end product. The cost of iron and steel not produced in the United States or a qualifying country includes but is not limited to the cost of iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings, not produced in the United States or a qualifying country, utilized in the manufacture of the end product and a good faith estimate of the cost of all iron or steel components not produced in the United States or a qualifying country, excluding commercially available off-the-shelf (COTS) fasteners. The domestic content test of the Buy American statute has not been waived for acquisitions of COTS items in this category, except for COTS fasteners.
                            </P>
                            <P>(c) Additional exceptions that allow the purchase of foreign end products are listed at 225.103.</P>
                            <P>(d)(1) In lieu of the threshold increases in FAR 25.101(a)(2)(i), use the domestic content threshold increases in paragraph (a)(ii) of this section. The senior procurement executive may approve application of an alternate domestic content test, under which the domestic content threshold in effect at the time of contract award will apply to the entire period of performance of the contract, following consultation with the Office of Management and Budget's Made in America Office. See PGI 225.101 for guidance on documentation requirements when the senior procurement executive approves application of an alternate domestic content test.</P>
                            <P>(2) When the senior procurement executive allows for application of an alternate domestic content test for the contract pursuant to FAR 25.101(d)(1) (but see paragraph (d)(1) of this section)—</P>
                            <P>(A) See 225.1101(2)(iv) for use of alternate II of the clause at 252.225-7001, Buy American and Balance of Payments Program;</P>
                            <P>(B) See 225.1101(2)(v) for use of alternate III of the clause at 252.225-7001, Buy American and Balance of Payments Program;</P>
                            <P>(C) See 225.1101(9) for use of the basic or alternate provision at 252.225-7035, Buy American—Free Trade Agreements—Balance of Payments Program Certificate, or the basic or alternate clause at 252.225-7036, Buy American—Free Trade Agreements—Balance of Payments Program; and</P>
                            <P>(D) See 225.1101(10)(i) for use of the basic or alternate clause at 252.225-7036, Buy American—Free Trade Agreements—Balance of Payments Program.</P>
                            <CITA>[68 FR 15618, Mar. 31, 2003, as amended at 87 FR 37443, June 23, 2022; 89 FR 11954, Feb. 15, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.103</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <P>(a)(i)(A) Public interest exceptions for certain countries are in 225.872.</P>
                            <P>(B) For procurements covered by the World Trade Organization Government Procurement Agreement, the Under Secretary of Defense (Acquisition and Sustainment) has determined that it is inconsistent with the public interest to apply the Buy American statute to end products that are substantially transformed in the United States.</P>
                            <P>(ii)(A) Normally, use the evaluation procedures in subpart 225.5, but consider recommending a public interest exception if the purposes of the Buy American statute are not served, or in order to meet a need set forth in 10 U.S.C. 4861. For example, a public interest exception may be appropriate—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) If accepting the low domestic offer will involve substantial foreign expenditures, or accepting the low foreign offer will involve substantial domestic expenditures;
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) To ensure access to advanced state-of-the-art commercial technology; or
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) To maintain the same source of supply for spare and replacement parts (also see paragraph (b)(iii)(B) of this section)—
                            </P>
                            <P>
                                (
                                <E T="03">i</E>
                                ) For an end item that qualifies as a domestic end product; or
                            </P>
                            <P>
                                (
                                <E T="03">ii</E>
                                ) In order not to impair integration of the military and commercial industrial base.
                            </P>
                            <P>(B) Except as provided in PGI 225.872-4, process a determination for a public interest exception after consideration of the factors in 10 U.S.C. 4861—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) At a level above the contracting officer for acquisitions valued at or below the simplified acquisition threshold;
                                <PRTPAGE P="194"/>
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) By the head of the contracting activity for acquisitions with a value greater than the simplified acquisition threshold but less than $1.5 million; or
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) By the agency head for acquisitions valued at $1.5 million or more.
                            </P>
                            <P>(b)(i) A determination that an article, material, or supply is not reasonably available is required when domestic offers are insufficient to meet the requirement and award is to be made on other than a qualifying country or eligible end product.</P>
                            <P>(ii) A determination is not required before January 1, 2030, if there is an offer for a foreign end product that exceeds 55 percent domestic content. Except as provided in FAR 25.103(b)(3), the determination shall be approved—</P>
                            <P>(A) At a level above the contracting officer for acquisitions valued at or below the simplified acquisition threshold;</P>
                            <P>(B) By the chief of the contracting office for acquisitions with a value greater than the simplified acquisition threshold but less than $1.5 million; or</P>
                            <P>(C) By the head of the contracting activity or immediate deputy for acquisitions valued at $1.5 million or more.</P>
                            <P>(iii) A separate determination as to whether an article is reasonably available is not required for the following articles. DoD has already determined that these articles are not reasonably available from domestic sources:</P>
                            <P>(A) Spare or replacement parts that must be acquired from the original foreign manufacturer or supplier.</P>
                            <P>(B) Foreign drugs acquired by the Defense Supply Center, Philadelphia, when the Director, Pharmaceuticals Group, Directorate of Medical Materiel, determines that only the requested foreign drug will fulfill the requirements.</P>
                            <P>(iv) Under coordinated acquisition (see Subpart 208.70), the determination is the responsibility of the requiring department when the requiring department specifies acquisition of a foreign end product.</P>
                            <P>(c) The cost of a domestic end product is unreasonable if it is not the low evaluated offer when evaluated under subpart 225.5.</P>
                            <CITA>[68 FR 15618, Mar. 31, 2003, as amended at 70 FR 2362, Jan. 13, 2005; 73 FR 4113, Jan. 24, 2008; 75 FR 45074, Aug. 2, 2010; 77 FR 35880, June 15, 2012; 80 FR 15912, Mar. 26, 2015; 87 FR 76993, Dec. 16, 2022; 88 FR 73236, Oct. 25, 2023; 89 FR 11954, Feb. 15, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.106</SECTNO>
                            <SUBJECT>Determining reasonableness of cost.</SUBJECT>
                            <P>(b) Use an evaluation factor of 50 percent instead of the factors specified in FAR 25.106(b)(1)(i) and (c)(1)(i).</P>
                            <CITA>[68 FR 15618, Mar. 31, 2003. Redesignated at 89 FR 11954, Feb. 15, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.170</SECTNO>
                            <SUBJECT>Acquisition from or through other Government agencies.</SUBJECT>
                            <P>Contracting activities must apply the evaluation procedures in subpart 225.5 when using Federal supply schedules.</P>
                            <CITA>[68 FR 15618, Mar. 31, 2003, as amended at 89 FR 11954, Feb. 15, 2024]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 225.2—Buy American—Construction Materials</HD>
                        <SECTION>
                            <SECTNO>225.202</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <P>(a)(2) A nonavailability determination is not required for construction materials listed in FAR 25.104(a). For other materials, a nonavailability determination shall be approved at the levels specified in 225.103(b)(ii). Use the estimated value of the construction materials to determine the approval level. A nonavailability determination is not required before January 1, 2030, if there is an offer for foreign construction material that exceeds 55 percent domestic content (also see FAR 25.204(b)(1)(ii) and (b)(2)(ii)).</P>
                            <CITA>[89 FR 11954, Feb. 15, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.206</SECTNO>
                            <SUBJECT>Noncompliance.</SUBJECT>
                            <P>(c)(4) Prepare any report of noncompliance in accordance with the procedures at 209.406-3 or 209.407-3.</P>
                            <CITA>[64 FR 62986, Nov. 18, 1999]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <PRTPAGE P="195"/>
                        <HD SOURCE="HED">Subpart 225.3—Contracts Performed Outside the United States</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>73 FR 16774, Mar. 31, 2008, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>225.301</SECTNO>
                            <SUBJECT>Contractor personnel in a designated operational area or supporting a diplomatic or consular mission outside the United States.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.301-1</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Performance in a designated operational area</E>
                                , as used in this section, means performance of a service or construction, as required by the contract. For supply contracts, the term includes services associated with the acquisition of supplies (e.g., installation or maintenance), but does not include production of the supplies or associated overhead functions.
                            </P>
                            <P>(c) For DoD, this section also applies to all personal services contracts.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.301-4</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>(1) Use the clause at FAR 52.225-19, Contractor Personnel in a Designated Operational Area or Supporting a Diplomatic or Consular Mission Outside the United States, in accordance with the prescription at FAR 25.301-4, except that—</P>
                            <P>(i) The clause shall also be used in personal services contracts with individuals; and</P>
                            <P>(ii) The clause shall not be used when all contractor personnel performing outside the United States will be covered by the clause at 252.225-7040.</P>
                            <P>
                                (2) When using the clause at FAR 52.225-19, the contracting officer shall inform the contractor that the Synchronized Predeployment and Operational Tracker (SPOT) is the appropriate automated system to use for the list of contractor personnel required by paragraph (g) of the clause. Information on the SPOT system is available at 
                                <E T="03"> https://spot.dmdc.mil</E>
                                 and 
                                <E T="03">http://www.acq.osd.mil/log/PS/ctr_mgt_accountability.html.</E>
                            </P>
                            <CITA>[73 FR 16774, Mar. 31, 2008, as amended at 74 FR 34265, July 15, 2009; 80 FR 67255, Oct. 30, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.302</SECTNO>
                            <SUBJECT>Contractors performing private security functions outside the United States.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.302-6</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at 252.225-7039, Defense Contractors Performing Private Security Functions Outside the United States, instead of FAR clause 52.225-26, Contractors Performing Private Security Functions Outside the United States, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, when private security functions are to be performed outside the United States in—</P>
                            <P>(1) Contingency operations;</P>
                            <P>(2) Combat operations, as designated by the Secretary of Defense;</P>
                            <P>(3) Other significant military operations (as defined in 32 CFR part 159), designated by the Secretary of Defense, and only upon agreement of the Secretary of Defense and the Secretary of State;</P>
                            <P>(4) Peace operations, consistent with Joint Publication 3-07.3; or</P>
                            <P>(5) Other military operations or military exercises, when designated by the Combatant Commander.</P>
                            <CITA>[80 FR 4999, Jan. 29, 2015, as amended at 81 FR 42560, June 30, 2016; 88 FR 6583, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.370</SECTNO>
                            <SUBJECT>Contracts requiring performance or delivery in a foreign country.</SUBJECT>
                            <P>(a) If the acquisition requires the performance of services or delivery of supplies in an area outside the United States, follow the procedures at PGI 225.370(a).</P>
                            <P>
                                (b) For work performed in Germany, eligibility for logistics support or base privileges of contractor employees is governed by U.S.-German bilateral agreements. Follow the procedures at Army in Europe Regulation 715-9, available at 
                                <E T="03">http://www.eur.army.mil/g1/content/CPD/docper/docper_germanyLinks.html</E>
                                 under “AE Regs &amp; Resources.”
                            </P>
                            <P>
                                (c) For work performed in Japan or Korea, see PGI 225.370(b) for information on bilateral agreements and policy relating to contractor employees in Japan or Korea.
                                <PRTPAGE P="196"/>
                            </P>
                            <P>(d) For work performed in the U.S. Central Command area of responsibility, follow the procedures for theater business clearance/contract administration delegation instructions at PGI 225.370(d).</P>
                            <CITA>[80 FR 36901, June 26, 2015, as amended at 80 FR 56930, Sept. 21, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.371</SECTNO>
                            <SUBJECT>Contractor personnel supporting U.S. Armed Forces deployed outside the United States.</SUBJECT>
                            <P>For additional information on contractor personnel supporting U.S. Armed Forces, see PGI 225.371.</P>
                            <CITA>[80 FR 36901, June 26, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.371-1</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>(a) This section applies to contracts that involve contractor personnel supporting U.S. Armed Forces deployed outside the United States in—</P>
                            <P>(1) Contingency operations;</P>
                            <P>(2) Humanitarian or peacekeeping operations; or</P>
                            <P>(3) Other military operations or military exercises, when designated by the combatant commander.</P>
                            <P>(b) Any of the types of operations listed in paragraph (a) of this section may include stability operations such as—</P>
                            <P>(1) Establishment or maintenance of a safe and secure environment; or</P>
                            <P>(2) Provision of emergency infrastructure reconstruction, humanitarian relief, or essential governmental services (until feasible to transition to local government).</P>
                            <CITA>[80 FR 36901, June 26, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.371-2</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <P>“Designated operational area” is defined in the clause at 252.225-7040. See PGI 225.371-2 for additional information on designated operational areas.</P>
                            <CITA>[80 FR 36901, June 26, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.371-3</SECTNO>
                            <SUBJECT>Government support.</SUBJECT>
                            <P>(a) Government support that may be authorized or required for contractor personnel performing in a designated operational area may include, but is not limited to, the types of support listed in PGI 225.371-3(a).</P>
                            <P>(b) The agency shall provide logistical or security support only when the appropriate agency official, in accordance with agency guidance, determines in coordination with the combatant commander that—</P>
                            <P>(1) Such Government support is available and is needed to ensure continuation of essential contractor services; and</P>
                            <P>(2) The contractor cannot obtain adequate support from other sources at a reasonable cost.</P>
                            <P>(c) The contracting officer shall specify in the solicitation and contract—</P>
                            <P>(1) Valid terms, approved by the combatant commander, that specify the responsible party, if a party other than the combatant commander is responsible for providing protection to the contractor personnel performing in the designated operational area; and</P>
                            <P>(2) Any other Government support to be provided, and whether this support will be provided on a reimbursable basis, citing the authority for the reimbursement.</P>
                            <P>
                                (d) 
                                <E T="03">Medical support of contractor personnel.</E>
                                 The contracting officer shall provide direction to the contractor when the contractor is required to reimburse the Government for medical treatment or transportation of contractor personnel to a selected civilian facility in accordance with paragraph (c)(2)(ii) of the clause at 252.225-7040. For additional information, see PGI 225.371-3(d).
                            </P>
                            <P>
                                (e) 
                                <E T="03">Letter of authorization.</E>
                                 Contractor personnel must have a Synchronized Predeployment and Operational Tracker (SPOT)-generated letter of authorization (LOA) signed by the contracting officer in order to process through a deployment center or to travel to, from, or within the designated operational area. The LOA also will identify any additional authorizations, privileges, or Government support that the contractor personnel are entitled to under the contract. For additional information on LOAs, see PGI 225.371-3(e).
                            </P>
                            <CITA>[80 FR 36901, June 26, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.371-4</SECTNO>
                            <SUBJECT>Law of war training.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Basic training.</E>
                                 Basic law of war training is required for all contractor personnel supporting U.S. Armed Forces deployed outside the United 
                                <PRTPAGE P="197"/>
                                States. The basic training normally will be provided through a military-run training center. The contracting officer may authorize the use of an alternate basic training source, provided the servicing DoD legal advisor concurs with the course content. An example of an alternate source of basic training is the web-based training provided by the Defense Acquisition University at 
                                <E T="03">https://acc.dau.mil/CommunityBrowser.aspx?id=18014&amp;lang=en-US.</E>
                            </P>
                            <P>
                                (b) 
                                <E T="03">Advanced law of war training.</E>
                                 (1) The types of personnel that must obtain advanced law of war training include the following:
                            </P>
                            <P>(i) Private security contractors.</P>
                            <P>(ii) Security guards in or near areas of military operations.</P>
                            <P>(iii) Interrogators, linguists, interpreters, guards, report writers, information technology technicians, or others who will come into contact with enemy prisoners of war, civilian internees, retained persons, other detainees, terrorists, or criminals who are captured, transferred, confined, or detained during or in the aftermath of hostilities.</P>
                            <P>(iv) Other personnel when deemed necessary by the contracting officer.</P>
                            <P>(2) If contractor personnel will be required to obtain advanced law of war training, the solicitation and contract shall specify—</P>
                            <P>(i) The types of personnel subject to advanced law of war training requirements;</P>
                            <P>(ii) Whether the training will be provided by the Government or the contractor;</P>
                            <P>(iii) If the training will be provided by the Government, the source of the training; and</P>
                            <P>(iv) If the training will be provided by the contractor, a requirement for coordination of the content with the servicing DoD legal advisor to ensure that training content is commensurate with the duties and responsibilities of the personnel to be trained.</P>
                            <CITA>[80 FR 36901, June 26, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.371-5</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>(a) Use the clause at 252.225-7040, Contractor Personnel Supporting U.S. Armed Forces Deployed Outside the United States, instead of the clause at FAR 52.225-19, Contractor Personnel in a Designated Operational Area or Supporting a Diplomatic or Consular Mission Outside the United States, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, for performance in a designated operational area that authorize contractor personnel (including both contractors authorized to accompany the Force (CAAF) and non-CAAF) to support U.S. Armed Forces deployed outside the United States in—</P>
                            <P>(1) Contingency operations;</P>
                            <P>(2) Peace operations consistent with Joint Publication 3-07.3; or</P>
                            <P>(3) Other military operations or military exercises, when designated by the combatant commander or as directed by the Secretary of Defense.</P>
                            <P>(b) For additional guidance on clauses to consider when using the clause at 252.225-7040, see PGI 225.371-5(b).</P>
                            <CITA>[80 FR 36901, June 26, 2015, as amended at 80 FR 51753, Aug. 26, 2015; 88 FR 6583, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.372</SECTNO>
                            <SUBJECT>Antiterrorism/force protection.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.372-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>Information and guidance pertaining to DoD antiterrorism/force protection policy for contracts that require performance or travel outside the United States can be obtained from the offices listed in PGI 225.372-1.</P>
                            <CITA>[80 FR 36902, June 26, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.372-2</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at 252.225-7043, Antiterrorism/Force Protection Policy for Defense Contractors Outside the United States, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, that require performance or travel outside the United States, except for contracts with—</P>
                            <P>(a) Foreign governments;</P>
                            <P>
                                (b) Representatives of foreign governments; or
                                <PRTPAGE P="198"/>
                            </P>
                            <P>(c) Foreign corporations wholly owned by foreign governments.</P>
                            <CITA>[80 FR 36902, June 26, 2015, as amended at 88 FR 6583, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.373</SECTNO>
                            <SUBJECT>Contract administration in support of contingency operations.</SUBJECT>
                            <P>For additional guidance on contract administration considerations when supporting contingency operations, see PGI 225.373.</P>
                            <CITA>[80 FR 36902, June 26, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.374</SECTNO>
                            <SUBJECT>Use of electronic business tools.</SUBJECT>
                            <P>See 218.271 concerning the use of electronic business tools in support of a contingency operation or humanitarian or peacekeeping operation.</P>
                            <CITA>[80 FR 36902, June 26, 2015, as amended at 83 FR 24890, May 30, 2018]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 225.4—Trade Agreements</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>65 FR 19852, Apr. 13, 2000, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>225.401</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <P>(a)(2)(A) If a department or agency considers an individual acquisition of a product to be indispensable for national security or national defense purposes and appropriate for exclusion from the provisions of FAR subpart 25.4, it may submit a request with supporting rationale to the Principal Director, Defense Pricing, Contracting, and Acquisition Policy (DPCAP), Office of the Under Secretary of Defense (Acquisition and Sustainment) (OUSD(A&amp;S)DPCAP). Approval by OUSD(A&amp;S)DPCAP is not required if—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Purchase from foreign sources is restricted by statute (see subpart 225.70);
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Another exception in FAR 25.401 applies to the acquisition; or
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) Competition from foreign sources is restricted under subpart 225.71.
                            </P>
                            <P>(B) Public interest exceptions for certain countries when acquiring products or services in support of operations in Afghanistan are in 225.7704-1.</P>
                            <CITA>[75 FR 81916, Dec. 29, 2010, as amended at 88 FR 73236, Oct. 25, 2023; 89 FR 60831, July 29, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.401-70</SECTNO>
                            <SUBJECT>End products subject to trade agreements.</SUBJECT>
                            <P>Acquisitions of end products in the following product service groups (PSGs) are covered by trade agreements if the value of the acquisition is at or above the applicable trade agreement threshold and no exception applies. If an end product is not in one of the listed groups, the trade agreements do not apply. The definition of Caribbean Basin country end products in FAR 25.003 excludes those end products that are not eligible for duty-free treatment under 19 U.S.C. 2703(b). Therefore certain watches, watch parts, and luggage from certain Caribbean Basin countries are not eligible products. However, 225.003 expands the definition of Caribbean Basin country end products to include petroleum and any product derived from petroleum, in accordance with Section 8094 of Pub. L. 103-139.</P>
                            <GPOTABLE COLS="2" OPTS="L0,7/8,g1,t1" CDEF="xls20,r25">
                                <BOXHD>
                                    <CHED H="1">PSG</CHED>
                                    <CHED H="1">Category/Description</CHED>
                                </BOXHD>
                                <ROW>
                                    <ENT I="01">22</ENT>
                                    <ENT>Railway equipment</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">23</ENT>
                                    <ENT>Motor vehicles, trailers, and cycles (except 2305, 2350, and buses under 2310)</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">24</ENT>
                                    <ENT>Tractors</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">25</ENT>
                                    <ENT>Vehicular equipment components</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">26</ENT>
                                    <ENT>Tires and tubes</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">29</ENT>
                                    <ENT>Engine accessories</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">30</ENT>
                                    <ENT>Mechanical power transmission equipment</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">32</ENT>
                                    <ENT>Woodworking machinery and equipment</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">34</ENT>
                                    <ENT>Metalworking machinery</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">35</ENT>
                                    <ENT>Service and trade equipment</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">36</ENT>
                                    <ENT>Special industry machinery (except 3690)</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">37</ENT>
                                    <ENT>Agricultural machinery and equipment</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">38</ENT>
                                    <ENT>Construction, mining, excavating, and highway maintenance equipment</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">39</ENT>
                                    <ENT>Materials handling equipment</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">40</ENT>
                                    <ENT>Rope, cable, chain, and fittings</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">41</ENT>
                                    <ENT>Refrigeration, air conditioning, and air circulating equipment</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">42</ENT>
                                    <ENT>Fire fighting, rescue, and safety equipment; and environmental protection equipment and materials</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">43</ENT>
                                    <ENT>Pumps and compressors</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">44</ENT>
                                    <ENT>Furnace, steam plant, and drying equipment (except 4470)</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">45</ENT>
                                    <ENT>Plumbing, heating, and waste disposal equipment</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">46</ENT>
                                    <ENT>Water purification and sewage treatment equipment</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">47</ENT>
                                    <ENT>Pipe, tubing, hose, and fittings</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">48</ENT>
                                    <ENT>Valves</ENT>
                                </ROW>
                                <ROW>
                                    <PRTPAGE P="199"/>
                                    <ENT I="01">49</ENT>
                                    <ENT>Maintenance and repair shop equipment (except 4920-4927, 4931-4935, 4960, 4970)</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">53</ENT>
                                    <ENT>Hardware and abrasives</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">54</ENT>
                                    <ENT>Prefabricated structures and scaffolding</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">55</ENT>
                                    <ENT>Lumber, millwork, plywood, and veneer</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">56</ENT>
                                    <ENT>Construction and building materials</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">61</ENT>
                                    <ENT>Electric wire, and power and distribution equipment</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">62</ENT>
                                    <ENT>Lighting fixtures and lamps</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">63</ENT>
                                    <ENT>Alarm, signal, and security detection systems</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">65</ENT>
                                    <ENT>Medical, dental, and veterinary equipment and supplies</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">66</ENT>
                                    <ENT>Instruments and laboratory equipment (except aircraft clocks under 6645)—See FAR 25.003 exclusion of certain watches and watch parts for certain Caribbean Basin countries</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">67</ENT>
                                    <ENT>Photographic equipment</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">68</ENT>
                                    <ENT>Chemicals and chemical products</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">69</ENT>
                                    <ENT>Training aids and devices</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">70</ENT>
                                    <ENT>Automatic data processing equipment (including firmware), software, supplies and support equipment</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">71</ENT>
                                    <ENT>Furniture</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">72</ENT>
                                    <ENT>Household and commercial furnishings and appliances</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">73</ENT>
                                    <ENT>Food preparation and serving equipment</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">74</ENT>
                                    <ENT>Office machines, text processing systems and visible record equipment</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">75</ENT>
                                    <ENT>Office supplies and devices</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">76</ENT>
                                    <ENT>Books, maps, and other publications</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">77</ENT>
                                    <ENT>Musical instruments, phonographs, and home-type radios</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">78</ENT>
                                    <ENT>Recreational and athletic equipment</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">79</ENT>
                                    <ENT>Cleaning equipment and supplies</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">80</ENT>
                                    <ENT>Brushes, paints, sealers, and adhesives</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">81</ENT>
                                    <ENT>Containers, packaging, and packing supplies (except 8140)</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">83</ENT>
                                    <ENT>Pins, needles, and sewing kits (only part of 8315) and flagstaffs, flagpoles, and flagstaff trucks (only part of 8345)</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">84</ENT>
                                    <ENT>Luggage (only 8460)—See FAR 25.003 for exclusion of luggage for Caribbean Basin countries</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">85</ENT>
                                    <ENT>Toiletries</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">87</ENT>
                                    <ENT>Agricultural supplies</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">88</ENT>
                                    <ENT>Live animals</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">89</ENT>
                                    <ENT>Tobacco products (only 8975)</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">91</ENT>
                                    <ENT>Fuels, lubricants, oils, and waxes</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">93</ENT>
                                    <ENT>Nonmetallic fabricated materials</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">94</ENT>
                                    <ENT>Nonmetallic crude materials</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">96</ENT>
                                    <ENT>Ores, minerals, and their primary products</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">99</ENT>
                                    <ENT>Miscellaneous</ENT>
                                </ROW>
                            </GPOTABLE>
                            <CITA>[65 FR 19852, Apr. 13, 2000, as amended at 68 FR 15619, Mar. 31, 2003; 69 FR 1927, Jan. 13, 2004; 70 FR 2363, Jan. 13, 2005; 70 FR 73154, Dec. 9, 2005; 71 FR 9270, Feb. 23, 2006; 80 FR 4805, Jan. 29, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.401-71</SECTNO>
                            <SUBJECT>Products or services in support of operations in Afghanistan.</SUBJECT>
                            <P>When acquiring products or services, other than small arms, in support of operations in Afghanistan, if using a procedure specified in 225.7703-1(a)(2) or (3), the procedures of subpart 25.4 are not applicable.</P>
                            <CITA>[78 FR 59857, Sept. 30, 2013]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.402</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>
                                To estimate the value of the acquisition, use the total estimated value of end products covered by trade agreements (
                                <E T="03">see</E>
                                 225.401-70).
                            </P>
                            <CITA>[70 FR 2363, Jan. 13, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.403</SECTNO>
                            <SUBJECT>World Trade Organization Government Procurement Agreement and Free Trade Agreements.</SUBJECT>
                            <P>(c) For acquisitions of supplies covered by the World Trade Organization Government Procurement Agreement, acquire only U.S.-made, qualifying country, or designated country end products unless—</P>
                            <P>(i) The contracting officer determines that offers of U.S.-made, qualifying country, or designated country end products from responsive, responsible offerors are either—</P>
                            <P>(A) Not received; or</P>
                            <P>(B) Insufficient to fill the Government's requirements. In this case, accept all responsive, responsible offers of U.S.-made, qualifying country, and eligible products before accepting any other offers;</P>
                            <P>(ii) A national interest waiver under 19 U.S.C. 2512(b)(2) is granted on a case-by-case basis. Except as delegated in paragraphs (c)(i)(A) and (B) of this section, submit any request for a national interest waiver to the Principal Director, Defense Pricing, Contracting, and Acquisition Policy in accordance with department or agency procedures. Include supporting rationale with the request.</P>
                            <P>
                                (A) The head of the contracting activity may approve a national interest waiver for a purchase by an overseas purchasing activity, if the waiver is 
                                <PRTPAGE P="200"/>
                                supported by a written statement from the requiring activity that the products being acquired are critical for the support of U.S. forces stationed abroad.
                            </P>
                            <P>(B) The Commander or Director, Defense Energy Support Center, may approve national interest waivers for purchases of fuel for use by U.S. forces overseas; or</P>
                            <P>(iii) The acquisition is in support of operations in Afghanistan (see 225.7704-1).</P>
                            <CITA>[68 FR 15619, Mar. 31, 2003, as amended at 70 FR 2363, Jan. 13, 2005; 75 FR 81916, Dec. 29, 2010; 76 FR 76320, Dec. 7, 2011; 88 FR 73236, Oct. 25, 2023; 89 FR 60831, July 29, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.408</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>(a)(4) The requirements of FAR 25.408(a)(4), on submission of offers in U.S. dollars, do not apply to overseas acquisitions or to Defense Energy Support Center post, camp, or station overseas requirements.</P>
                            <CITA>[70 FR 73154, Dec. 9, 2005]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 225.5—Evaluating Foreign Offers—Supply Contracts</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>68 FR 15620, Mar. 31, 2003, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>225.502</SECTNO>
                            <SUBJECT>Application.</SUBJECT>
                            <P>(a) Whenever the acquisition is in support of operations in Afghanistan, treat the offers of end products from South Caucasus or Central and South Asian states listed in 225.401-70 the same as qualifying country offers.</P>
                            <P>(b) Use the following procedures instead of the procedures in FAR 25.502(b) for acquisitions subject to the World Trade Organization Government Procurement Agreement:</P>
                            <P>(i) Consider only offers of U.S.-made, qualifying country, or designated country end products, except as permitted by 225.403 or 225.7703-1.</P>
                            <P>(ii) If price is the determining factor, award on the low offer.</P>
                            <P>(c) Use the following procedures instead of those in FAR 25.502(c) for acquisitions subject to the Buy American statute or the Balance of Payments Program:</P>
                            <P>(i)(A) If the acquisition is subject only to the Buy American statute or the Balance of Payments Program, then only qualifying country end products are exempt from application of the Buy American or Balance of Payments Program evaluation factor.</P>
                            <P>(B) If the acquisition is also subject to a Free Trade Agreement, then eligible products of the applicable Free Trade Agreement country are also exempt from application of the Buy American or Balance of Payments Program evaluation factor, but see 225.106.</P>
                            <P>(ii) If price is the determining factor, use the following procedures:</P>
                            <P>(A) If the low offer is a domestic offer, award on that offer.</P>
                            <P>(B) If there are no domestic offers, award on the low offer (see example in PGI 225.504(1)).</P>
                            <P>(C) If the low offer is a foreign offer that is exempt from application of the Buy American or Balance of Payments Program evaluation factor, award on that offer. If the low offer is a qualifying country offer from a country listed at 225.872-1(b), execute a determination in accordance with 225.872-4. A qualifying country offer is subject to the domestic content requirement for end products that are wholly or predominantly of iron or steel or a combination of both.</P>
                            <P>(D) If the low offer is a foreign offer that is not exempt from application of the Buy American or Balance of Payments Program evaluation factor, and there is another foreign offer that is exempt and is lower than the lowest domestic offer, award on the low foreign offer (see example in PGI 225.504(2)).</P>
                            <P>(E) Otherwise, apply the 50 percent evaluation factor to the low foreign offer.</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) If the price of the low domestic offer is less than the evaluated price of the low foreign offer, award on the low domestic offer (see example in PGI 225.504(3)).
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) If the evaluated price of the low foreign offer remains less than the low domestic offer, award on the low foreign offer (see example in PGI 225.504(4)).
                            </P>
                            <P>(iii) If price is not the determining factor, use the following procedures:</P>
                            <P>
                                (A) If there are domestic offers, apply the 50 percent Buy American or Balance of Payments Program evaluation 
                                <PRTPAGE P="201"/>
                                factor to all foreign offers unless an exemption applies.
                            </P>
                            <P>(B) Evaluate in accordance with the criteria of the solicitation.</P>
                            <P>(C) If these procedures will not result in award on a domestic offer, reevaluate offers without the 50 percent factor. If this will result in award on an offer to which the Buy American statute or Balance of Payments Program applies, but evaluation in accordance with paragraph (c)(ii) of this section would result in award on a domestic offer, proceed with award only after execution of a determination in accordance with 225.103(a)(ii)(B), that domestic preference would be inconsistent with the public interest.</P>
                            <P>(iv) If the solicitation includes the provision at 252.225-7023, Preference for Products or Services from Afghanistan, use the evaluation procedures at 225.7703-3.</P>
                            <CITA>[68 FR 15620, Mar. 31, 2003, as amended at 69 FR 1928, Jan. 13, 2004; 69 FR 74992, Dec. 15, 2004; 70 FR 2363, Jan. 13, 2005; 73 FR 53152, Sept. 15, 2008; 75 FR 81916, Dec. 29, 2010; 77 FR 35881, June 15, 2012; 78 FR 59857, Sept. 30, 2013; 87 FR 37443, June 23, 2022; 89 FR 11954, Feb. 15, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.503</SECTNO>
                            <SUBJECT>Group offers.</SUBJECT>
                            <P>Evaluate group offers in accordance with FAR 25.503, but apply the evaluation procedures of 225.502.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.504</SECTNO>
                            <SUBJECT>Evaluation examples.</SUBJECT>
                            <P>For examples that illustrate the evaluation procedures in 225.502(c)(ii), see PGI 225.504.</P>
                            <CITA>[70 FR 73154, Dec. 9, 2005]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 225.7—Prohibited Sources</HD>
                        <SECTION>
                            <SECTNO>225.701</SECTNO>
                            <SUBJECT>Restrictions administered by the Department of the Treasury on acquisitions of supplies or services from prohibited sources.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.701-70</SECTNO>
                            <SUBJECT>Exception.</SUBJECT>
                            <P>DoD personnel are authorized to make emergency acquisitions in direct support of U.S. or allied forces deployed in military contingency, humanitarian, or peacekeeping operations in a country or region subject to economic sanctions administered by the Department of the Treasury, Office of Foreign Assets Control.</P>
                            <CITA>[68 FR 7441, Feb. 14, 2003]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.770</SECTNO>
                            <SUBJECT>Prohibition on acquisition of certain items from Communist Chinese military companies.</SUBJECT>
                            <P>This section implements section 1211 of the National Defense Authorization Act for Fiscal Year 2006 (Pub. L. 109-163), section 1243 of the National Defense Authorization Act for Fiscal Year 2012 (Pub. L. 112-81), and section 1296 of the National Defense Authorization Act for Fiscal Year 2017 (Pub. L. 114-328). See PGI 225.770 for additional information relating to this statute, the terms used in this section, the United States Munitions List (USML), and the 600 series of the Commerce Control List (CCL).</P>
                            <CITA>[83 FR 66071, Dec. 21, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.770-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this section—</P>
                            <P>
                                <E T="03">Component</E>
                                 means an item that is useful only when used in conjunction with an end item (15 CFR 772.1 and 22 CFR 120.45(b)).
                            </P>
                            <P>
                                <E T="03">Item</E>
                                 means—
                            </P>
                            <P>(1) A USML defense article, as defined at 22 CFR 120.6;</P>
                            <P>(2) A USML defense service, as defined at 22 CFR 120.9; or</P>
                            <P>(3) A 600 series item, as defined at 15 CFR 772.1.</P>
                            <P>
                                <E T="03">Part</E>
                                 means any single unassembled element of a major or minor component, accessory, or attachment, that is not normally subject to disassembly without the destruction or impairment of designed use (15 CFR 772.1 and 22 CFR 120.45(d)).
                            </P>
                            <CITA>[83 FR 66072, Dec. 21, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.770-2</SECTNO>
                            <SUBJECT>Prohibition.</SUBJECT>
                            <P>Do not acquire items covered by the USML or the 600 series of the CCL, through a contract or subcontract at any tier, from any Communist Chinese military company. This prohibition does not apply to components and parts of covered items unless the components and parts are themselves covered by the USML or the 600 series of the CCL.</P>
                            <CITA>[83 FR 66072, Dec. 21, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="202"/>
                            <SECTNO>225.770-3</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <P>The prohibition in 225.770-2 does not apply to items acquired—</P>
                            <P>(a) In connection with a visit to the People's Republic of China by a vessel or an aircraft of the U.S. armed forces;</P>
                            <P>(b) For testing purposes; or</P>
                            <P>(c) For the purpose of gathering intelligence.</P>
                            <CITA>[71 FR 53046, Sept. 8, 2006, as amended at 83 FR 66072, Dec. 21, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.770-4</SECTNO>
                            <SUBJECT>Identifying items covered by the USML or the 600 series of the CCL.</SUBJECT>
                            <P>(a) Before issuance of a solicitation, the requiring activity will notify the contracting officer in writing whether the items to be acquired are covered by the USML or the 600 series of the CCL. The notification will identify any covered item(s) and will provide the pertinent USML reference(s) from 22 CFR part 121 or the 600 series of the CCL references from 15 CFR part 774, supplement no. 1.</P>
                            <P>
                                (b) The USML includes defense articles and defense services that fall into 21 categories. The CCL includes ten categories and five product groups in each category, many of which contain 600 series items. Since not all items covered by the USML or 600 series of the CCL are themselves munitions (
                                <E T="03">e.g.,</E>
                                 protective personnel equipment, military training equipment), the requiring activity should consult the USML and the 600 series of the CCL before concluding that an item is or is not covered. See PGI 225.770-4.
                            </P>
                            <CITA>[83 FR 66072, Dec. 21, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.770-5</SECTNO>
                            <SUBJECT>Waiver of prohibition.</SUBJECT>
                            <P>(a) The prohibition in 225.770-2 may be waived, on a case-by-case basis, if an official identified in paragraph (b) of this subsection determines that a waiver is necessary for national security purposes.</P>
                            <P>(b) The following officials are authorized, without power of delegation, to make the determination specified in paragraph (a) of this subsection:</P>
                            <P>(1) The Under Secretary of Defense (Acquisition and Sustainment).</P>
                            <P>(2) The Secretaries of the military departments.</P>
                            <P>(3) The Component Acquisition Executive of the Defense Logistics Agency.</P>
                            <P>(c)(1) The official granting a waiver shall submit a report to the congressional defense committees, with a copy to the Principal Director, Defense Pricing, Contracting, and Acquisition Policy (see PGI 225.770-5), not less than 15 days before issuing the waiver.</P>
                            <P>(2) In the report, the official shall—</P>
                            <P>(i) Identify the specific reasons for the waiver; and</P>
                            <P>(ii) Include recommendations as to what actions may be taken to develop alternative sourcing capabilities in the future.</P>
                            <CITA>[71 FR 53046, Sept. 8, 2006, as amended at 77 FR 30366, May 22, 2012; 83 FR 66072, Dec. 21, 2018; 88 FR 73236, Oct. 25, 2023; 89 FR 60831, July 29, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.771</SECTNO>
                            <SUBJECT>Prohibition on contracting or subcontracting with a firm that is owned or controlled by the government of a country that is a state sponsor of terrorism.</SUBJECT>
                            <CITA>[79 FR 73489, Dec. 11, 2014]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.771-0</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>This section implements 10 U.S.C. 4871(b).</P>
                            <CITA>[79 FR 73489, Dec. 11, 2014, as amended at 87 FR 76993, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.771-1</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <P>“State sponsor of terrorism,” as used in this section, is defined in the provision at 252.225-7050, Disclosure of Ownership or Control by the Government of a Country that is a State Sponsor of Terrorism.</P>
                            <CITA>[79 FR 73489, Dec. 11, 2014]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.771-2</SECTNO>
                            <SUBJECT>Prohibition.</SUBJECT>
                            <P>(a) The contracting officer shall not award a contract of $150,000 or more to a firm when a foreign government that is a state sponsor of terrorism owns or controls, either directly or indirectly, a significant interest in—</P>
                            <P>(i) The firm;</P>
                            <P>(ii) A subsidiary of the firm; or</P>
                            <P>(iii) Any other firm that owns or controls the firm.</P>
                            <P>
                                (b) For restrictions on subcontracting with a firm, or a subsidiary of a firm, that is identified by the Secretary of Defense as being owned or 
                                <PRTPAGE P="203"/>
                                controlled by the government of a country that is a state sponsor of terrorism, see 209.405-2.
                            </P>
                            <CITA>[79 FR 73489, Dec. 11, 2014]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.771-3</SECTNO>
                            <SUBJECT>Notification.</SUBJECT>
                            <P>Any disclosure that the government of a country that is a state sponsor of terrorism has a significant interest in an offeror, a subsidiary of an offeror, or any other firm that owns or controls an offeror shall be forwarded through agency channels to the address at PGI 225.771-3.</P>
                            <CITA>[79 FR 73489, Dec. 11, 2014]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.771-4</SECTNO>
                            <SUBJECT>Waiver of prohibition.</SUBJECT>
                            <P>The prohibition in 225.771-2 may be waived if the Secretary of Defense determines that a waiver is not inconsistent with the national security objectives of the United States in accordance with 10 U.S.C. 4871(c).</P>
                            <CITA>[79 FR 73489, Dec. 11, 2014, as amended at 87 FR 76993, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.771-5</SECTNO>
                            <SUBJECT>Solicitation provision.</SUBJECT>
                            <P>Use the provision at 252.225-7050, Disclosure of Ownership or Control by the Government of a Country that is a State Sponsor of Terrorism, in solicitations, including solicitations using FAR part 12 procedures for the acquisition of commercial products and commercial services (other than commercial satellite services), that are expected to result in contracts of $150,000 or more. If the solicitation includes the provision at FAR 52.204-7, do not separately list the provision 252.225-7050 in the solicitation.</P>
                            <CITA>[79 FR 73489, Dec. 11, 2014, as amended at 88 FR 6584, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.772</SECTNO>
                            <SUBJECT>Prohibition on acquisition of certain foreign commercial satellite services.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.772-0</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>This section implements 10 U.S.C. 2279.</P>
                            <CITA>[79 FR 45664, Aug. 5, 2014]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.772-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this section—</P>
                            <P>
                                <E T="03">Covered foreign country</E>
                                 means—
                            </P>
                            <P>(1) The People's Republic of China;</P>
                            <P>(2) North Korea;</P>
                            <P>(3) The Russian Federation; or</P>
                            <P>(4) Any country that is a state sponsor of terrorism. (10 U.S.C. 2279)</P>
                            <P>
                                <E T="03">Cybersecurity risk</E>
                                 means threats to and vulnerabilities of information or information systems and any related consequences caused by or resulting from unauthorized access, use, disclosure, degradation, disruption, modification, or destruction of such information or information systems, including such related consequences caused by an act of terrorism. (10 U.S.C. 2279)
                            </P>
                            <P>
                                <E T="03">Foreign entity</E>
                                 means—
                            </P>
                            <P>(1) Any branch, partnership, group or sub-group, association, estate, trust, corporation or division of a corporation, or organization organized under the laws of a foreign state if either its principal place of business is outside the United States or its equity securities are primarily traded on one or more foreign exchanges.</P>
                            <P>(2) Notwithstanding paragraph (1) of this definition, any branch, partnership, group or sub-group, association, estate, trust, corporation or division of a corporation, or organization that demonstrates that a majority of the equity interest in such entity is ultimately owned by U.S. nationals is not a foreign entity. (31 CFR 800.212)</P>
                            <P>
                                <E T="03">Government of a covered foreign country</E>
                                 includes the state and the government of a covered foreign country, as well as any political subdivision, agency, or instrumentality thereof.
                            </P>
                            <P>
                                <E T="03">Launch vehicle</E>
                                 means a fully integrated space launch vehicle. (10 U.S.C. 2279)
                            </P>
                            <P>
                                <E T="03">Satellite services</E>
                                 means communications capabilities that utilize an on-orbit satellite for transmitting the signal from one location to another.
                            </P>
                            <P>
                                <E T="03">State sponsor of terrorism</E>
                                 means a country determined by the Secretary of State, under section 1754(c)(1)(A)(i) of the Export Control Reform Act of 2018 (Title XVII, Subtitle B, of the National Defense Authorization Act for Fiscal Year 2019, Pub. L. 115-232), to be a country the government of which has repeatedly provided support for acts of international terrorism. As of December 14, 2020, state sponsors of terrorism 
                                <PRTPAGE P="204"/>
                                include Iran, North Korea, and Syria. (10 U.S.C. 4871)
                            </P>
                            <CITA>[83 FR 66072, Dec. 21, 2018, as amended at 86 FR 53883, Sept. 29, 2021; 87 FR 76993, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.772-2</SECTNO>
                            <SUBJECT>Prohibitions.</SUBJECT>
                            <P>Except as provided in 225.772-4, the contracting officer shall not award a contract for commercial satellite services to—</P>
                            <P>(a)(1) A foreign entity if the Under Secretary of Defense for Acquisition and Sustainment or the Under Secretary of Defense for Policy reasonably believes that—</P>
                            <P>(i) The foreign entity is an entity in which the government of a covered foreign country has an ownership interest that enables the government to affect satellite operations;</P>
                            <P>(ii) The foreign entity plans to or is expected to provide satellite services under the contract from a covered foreign country; or</P>
                            <P>(iii) Entering into such contract would create an unacceptable cybersecurity risk for DoD, as determined by the Under Secretary of Defense for Acquisition and Sustainment or the Under Secretary of Defense for Policy; or</P>
                            <P>(2) An offeror that is offering commercial satellite services provided by a foreign entity as described in paragraph (a) of this section; or</P>
                            <P>(b)(1) Any entity, except as provided in paragraph (b)(2) of this section, for a launch that occurs on or after December 31, 2022, if the Under Secretary of Defense for Acquisition and Sustainment or the Under Secretary of Defense for Policy reasonably believes that such satellite services will be provided using satellites that will be—</P>
                            <P>(i) Designed or manufactured—</P>
                            <P>(A) In a covered foreign country; or</P>
                            <P>(B) By an entity controlled in whole or in part by, or acting on behalf of, the government of a covered foreign country; or</P>
                            <P>(ii) Launched outside the United States using a launch vehicle that is—</P>
                            <P>(A) Designed or manufactured in a covered foreign country; or</P>
                            <P>(B) Provided by—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) The government of a covered foreign country; or
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) An entity controlled in whole or in part by, or acting on behalf of, the government of a covered foreign country.
                            </P>
                            <P>(2) The prohibition in paragraph (b)(1) of this section does not apply with respect to launch services for which a satellite service provider has a contract or other agreement that, prior to June 10, 2018, was either fully paid for by the satellite service provider or covered by a legally binding commitment of the satellite service provider to pay for such services.</P>
                            <CITA>[83 FR 66072, Dec. 21, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.772-3</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>(a)(1) The contracting officer shall not award to any source that is a foreign satellite service provider or is offering satellite services provided by a foreign entity if such award presents an unacceptable cybersecurity risk, as determined by the Under Secretary of Defense for Acquisition and Sustainment or the Under Secretary of Defense for Policy.</P>
                            <P>(2) When procuring commercial satellite services from a foreign entity, the contracting officer shall review the exclusion records in the System for Award Management (SAM) database as required at FAR 9.405, to ensure that an entity identified in, or otherwise known to be involved in, the otherwise successful offer is not listed as ineligible in the SAM database (see FAR 9.405).</P>
                            <P>(b) If an offeror discloses information in accordance with paragraph (c) of the provision 252.225-7049, Prohibition on Acquisition of Certain Foreign Commercial Satellite Services—Representations, the contracting officer—</P>
                            <P>(1) Shall forward the information regarding the offeror through agency channels to the address at PGI 225.772-3; and</P>
                            <P>(2) Shall not award to that offeror, unless an exception is determined to apply in accordance with 225.772-4.</P>
                            <P>
                                (c)(1) If the otherwise successful offeror provides negative responses to all representations in the provision at 252.225-7049, the contracting officer may rely on the representations, unless the contracting officer has an independent reason to question the representations.
                                <PRTPAGE P="205"/>
                            </P>
                            <P>(2) If the contracting officer has an independent reason to question a negative representation of the otherwise successful offeror, the contracting officer shall consult with the office specified in PGI 225.772-3, prior to deciding whether to award to that offeror.</P>
                            <CITA>[79 FR 45664, Aug. 5, 2014, as amended at 83 FR 66073, Dec. 21, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.772-4</SECTNO>
                            <SUBJECT>Exception.</SUBJECT>
                            <P>(a) The prohibitions in 225.772-2(a) and (b) do not apply if—</P>
                            <P>(1) The Under Secretary of Defense for Acquisition and Sustainment, or the Under Secretary of Defense for Policy, without power of redelegation, determines that it is in the national security interest of the United States to enter into such contract; and</P>
                            <P>(2) Not later than seven days before entering into such contract, the Under Secretary of Defense making the determination in paragraph (a)(1) of this section, in consultation with the Director of National Intelligence, submits to the congressional defense committees a national security assessment, in accordance with 10 U.S.C. 2279.</P>
                            <P>(b) If requesting an exception pursuant to paragraph (a) of this section, the contracting officer shall forward the request through agency channels to the address at PGI 225.772-3, providing any available information necessary for the Under Secretary of Defense making the determination in paragraph (a)(1) of this section to evaluate the request and perform a national security assessment, in accordance with 10 U.S.C. 2279.</P>
                            <CITA>[79 FR 45664, Aug. 5, 2014, as amended at 83 FR 66073, Dec. 21, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.772-5</SECTNO>
                            <SUBJECT>Solicitation provision and contract clauses.</SUBJECT>
                            <P>(a) Use the provision at 252.225-7049, Prohibition on Acquisition of Certain Foreign Commercial Satellite Services—Representations, in solicitations that include the clause at 252.225-7051, Prohibition on Acquisition of Certain Foreign Commercial Satellite Services. If the solicitation includes the provision at FAR 52.204-7, do not separately list the provision 252.225-7049 in the solicitation.</P>
                            <P>(b) Use the clause at 252.225-7051, Prohibition on Acquisition of Certain Foreign Commercial Satellite Services, in solicitations and contracts for the acquisition of commercial satellite services, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services.</P>
                            <P>(c) Use the clause at 252.239-7018, Supply Chain Risk, as prescribed at 239.7306(b), when applicable.</P>
                            <CITA>[83 FR 66073, Dec. 21, 2018, as amended at 88 FR 6584, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 225.8—Other International Agreements and Coordination</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>68 FR 15621, Mar. 31, 2003, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>225.802</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>(b) Information on memoranda of understanding and other international agreements is available at PGI 225.802(b).</P>
                            <CITA>[70 FR 73154, Dec. 9, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.802-70</SECTNO>
                            <SUBJECT>Contracts for performance outside the United States and Canada.</SUBJECT>
                            <P>Follow the procedures at PGI 225.802-70 when placing a contract requiring performance outside the United States and Canada. Also see subpart 225.3, Contracts Performed Outside the United States.</P>
                            <CITA>[70 FR 23801, May 5, 2005, as amended at 77 FR 43472, July 24, 2012; 80 FR 36902, June 26, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.802-71</SECTNO>
                            <SUBJECT>End use certificates.</SUBJECT>
                            <P>Contracting officers considering the purchase of an item from a foreign source may encounter a request for the signing of a certificate to indicate that the Armed Forces of the United States is the end user of the item, and that the U.S. Government will not transfer the item to third parties without authorization from the Government of the country selling the item. When encountering this situation, refer to DoD Directive 2040.3, End Use Certificates, for guidance.</P>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="206"/>
                            <SECTNO>225.870</SECTNO>
                            <SUBJECT>Contracting with Canadian contractors.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.870-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>(a) The Canadian government guarantees to the U.S. Government all commitments, obligations, and covenants of the Canadian Commercial Corporation under any contract or order issued to the Corporation by any contracting office of the U.S. Government. The Canadian government has waived notice of any change or modification that may be made, from time to time, in these commitments, obligations, or covenants.</P>
                            <P>(b) For production planning purposes, Canada is part of the defense industrial base (see 225.870-2(b)).</P>
                            <P>(c) The Canadian Commercial Corporation will award and administer contracts with contractors located in Canada, except for—</P>
                            <P>(1) Negotiated acquisitions for experimental, developmental, or research work under projects other than the Defense Development Sharing Program;</P>
                            <P>(2) Acquisitions of unusual or compelling urgency;</P>
                            <P>(3) Acquisitions at or below the simplified acquisition threshold; or</P>
                            <P>(4) Acquisitions made by DoD activities located in Canada.</P>
                            <P>(d) For additional information on production rights, data, and information; services provided by Canadian Commercial Corporation; audit; and inspection, see PGI 225.870-1(d).</P>
                            <CITA>[68 FR 15621, Mar. 31, 2003, as amended at 70 FR 73154, Dec. 9, 2005; 77 FR 43472, July 24, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.870-2</SECTNO>
                            <SUBJECT>Solicitation of Canadian contractors.</SUBJECT>
                            <P>(a) If requested, furnish a solicitation to the Canadian Commercial Corporation even if no Canadian firm is solicited.</P>
                            <P>(b) Handle acquisitions at or below the simplified acquisition threshold directly with Canadian firms and not through the Canadian Commercial Corporation.</P>
                            <CITA>[68 FR 15621, Mar. 31, 2003, as amended at 72 FR 20758, Apr. 26, 2007]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.870-3</SECTNO>
                            <SUBJECT>Submission of offers.</SUBJECT>
                            <P>(a) As indicated in 225.870-4, the Canadian Commercial Corporation is the prime contractor. To indicate acceptance of offers by individual Canadian companies, the Canadian Commercial Corporation issues a letter supporting the Canadian offer and containing the following information:</P>
                            <P>(1) Name of the Canadian offeror.</P>
                            <P>(2) Confirmation and endorsement of the offer in the name of the Canadian Commercial Corporation.</P>
                            <P>(3) A statement that the Corporation shall subcontract 100 percent with the offeror.</P>
                            <P>(b) When a Canadian offer cannot be processed through the Canadian Commercial Corporation in time to meet the date for receipt of offers, the Corporation may permit Canadian firms to submit offers directly. However, the contracting officer shall receive the Canadian Commercial Corporation's endorsement before contract award.</P>
                            <P>(c) The Canadian Commercial Corporation will submit all sealed bids in terms of U.S. currency. Do not adjust contracts awarded under sealed bidding for losses or gains from fluctuation in exchange rates.</P>
                            <P>(d) Except for sealed bids, the Canadian Commercial Corporation normally will submit offers and quotations in terms of Canadian currency. The Corporation may, at the time of submitting an offer, elect to quote and receive payment in terms of U.S. currency, in which case the contract—</P>
                            <P>(1) Shall provide for payment in U.S. currency; and</P>
                            <P>(2) Shall not be adjusted for losses or gains from fluctuation in exchange rates.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.870-4</SECTNO>
                            <SUBJECT>Contracting procedures.</SUBJECT>
                            <P>(a) Except for contracts described in 225.870-1(c)(1) through (4), award individual contracts covering purchases from suppliers located in Canada to the Canadian Commercial Corporation, 350 Albert Street, Suite 700, Ottawa, ON K1R 1A4.</P>
                            <P>(b) Direct communication with the Canadian supplier is authorized and encouraged in connection with all technical aspects of the contract, provided the Corporation's approval is obtained on any matters involving changes to the contract.</P>
                            <P>
                                (c) 
                                <E T="03">Requirement for data other than certified cost or pricing data.</E>
                                 (1) DoD has 
                                <PRTPAGE P="207"/>
                                waived the requirement for submission of certified cost or pricing data for the Canadian Commercial Corporation and its subcontractors (see 215.403-1(c)(4)(C)).
                            </P>
                            <P>(2) The Canadian Commercial Corporation is not exempt from the requirement to submit data other than certified cost or pricing data, as defined in FAR 2.101. In accordance with FAR 15.403-3(a)(1)(ii), the contracting officer shall require submission of data other than certified cost or pricing data from the offeror, to the extent necessary to determine a fair and reasonable price.</P>
                            <P>(i) No further approval is required to request data other than certified cost or pricing data from the Canadian Commercial Corporation in the following circumstances:</P>
                            <P>(A) In a solicitation for a sole source acquisition that is—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Cost-reimbursement, if the contract value is expected to exceed $700,000; or
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Fixed-price, if the contract value is expected to exceed $500 million.
                            </P>
                            <P>(B) If the Canadian Commercial Corporation submits the only offer in response to a competitive solicitation that meets the thresholds specified in paragraph (c)(2)(i)(A) of this section.</P>
                            <P>(C) For modifications that exceed $150,000 in contracts that meet the criteria in paragraph (c)(2)(i)(A) or (B) of this section.</P>
                            <P>(D) In competitive solicitations in which data other than certified cost or pricing data are required from all offerors.</P>
                            <P>(ii) In any circumstances other than those specified in paragraph (c)(2)(i) of this section, the contracting officer shall only require data other than certified cost or pricing data from the Canadian Commercial Corporation if the head of the contracting activity, or designee no lower than two levels above the contracting officer, determines that data other than certified cost or pricing data are needed (or in the case of modifications that it is reasonably certain that data other than certified cost or pricing data will be needed) in order to determine that the price is fair and reasonable) (see FAR 15.403-3(a).</P>
                            <P>(3) The contracting officer shall use the provision at 252.215-7003, Requirement for Submission of Data Other Than Certified Cost or Pricing Data—Canadian Commercial Corporation, and the clause at 252.215-7004, Requirement for Submission of Data Other Than Certified Cost or Pricing Data—Modifications—Canadian Commercial Corporation, as prescribed at 215.408(2)(i) and (ii), respectively.</P>
                            <P>(4) Except for contracts described in 225.870-1(c)(1) through (4), Canadian suppliers will provide required data other than certified cost or pricing data exclusively through the Canadian Commercial Corporation.</P>
                            <P>(5) As specified in FAR 15.403-3(a)(4), an offeror who does not comply with a requirement to submit data that the contracting officer has deemed necessary to determine price reasonableness or cost realism is ineligible for award, unless the head of the contracting activity determines that it is in the best interest of the Government to make the award to that offeror, based on consideration of the following:</P>
                            <P>(i) The effort made to obtain the data.</P>
                            <P>(ii) The need for the item or service.</P>
                            <P>(iii) Increased cost or significant harm to the Government if award is not made.</P>
                            <P>
                                (d) Identify in the contract, the type of currency, 
                                <E T="03">i.e.,</E>
                                 U.S. or Canadian. Contracts that provide for payment in Canadian currency shall—
                            </P>
                            <P>
                                (1) Quote the contract price in terms of Canadian dollars and identify the amount by the initials “CN”, 
                                <E T="03">e.g.,</E>
                                 $1,647.23CN; and
                            </P>
                            <P>(2) Clearly indicate on the face of the contract the U.S./Canadian conversion rate at the time of award and the U.S. dollar equivalent of the Canadian dollar contract amount.</P>
                            <CITA>[68 FR 15621, Mar. 31, 2003, as amended at 77 FR 43472, July 24, 2012; 78 FR 65217, Oct. 31, 2013; 80 FR 36718, June 26, 2015; 82 FR 61480, Dec. 28, 2017; 83 FR 30825, June 29, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.870-5</SECTNO>
                            <SUBJECT>Contract administration.</SUBJECT>
                            <P>Follow the contract administration procedures at PGI 225.870-5.</P>
                            <CITA>[70 FR 73155, Dec. 9, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="208"/>
                            <SECTNO>225.870-6</SECTNO>
                            <SUBJECT>Termination procedures.</SUBJECT>
                            <P>When contract termination is necessary, follow the procedures at 249.7000.</P>
                            <CITA>[71 FR 27645, May 12, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.870-7</SECTNO>
                            <SUBJECT>Acceptance of Canadian supplies.</SUBJECT>
                            <P>For information on the acceptance of Canadian supplies, see PGI 225.870-7.</P>
                            <CITA>[70 FR 73155, Dec. 9, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.870-8</SECTNO>
                            <SUBJECT>Industrial security.</SUBJECT>
                            <P>Industrial security for Canada shall be in accordance with the U.S.-Canada Industrial Security Agreement of March 31, 1952, as amended.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.871</SECTNO>
                            <SUBJECT>North Atlantic Treaty Organization (NATO) cooperative projects.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.871-1</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>This section implements 22 U.S.C. 2767 and 10 U.S.C. 2350b.</P>
                            <CITA>[70 FR 73155, Dec. 9, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.871-2</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this section—</P>
                            <P>
                                (a) 
                                <E T="03">Cooperative project</E>
                                 means a jointly managed arrangement—
                            </P>
                            <P>(1) Described in a written agreement between the parties;</P>
                            <P>(2) Undertaken to further the objectives of standardization, rationalization, and interoperability of the armed forces of NATO member countries; and</P>
                            <P>(3) Providing for—</P>
                            <P>(i) One or more of the other participants to share with the United States the cost of research and development, testing, evaluation, or joint production (including follow-on support) of certain defense articles;</P>
                            <P>(ii) Concurrent production in the United States and in another member country of a defense article jointly developed; or</P>
                            <P>(iii) Acquisition by the United States of a defense article or defense service from another member country.</P>
                            <P>
                                (b) 
                                <E T="03">Other participant</E>
                                 means a cooperative project participant other than the United States.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.871-3</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Cooperative project authority.</E>
                                 (1) Departments and agencies, that have authority to do so, may enter into cooperative project agreements with NATO or with one or more member countries of NATO under DoDD 5530.3, International Agreements.
                            </P>
                            <P>(2) Under laws and regulations governing the negotiation and implementation of cooperative project agreements, departments and agencies may enter into contracts, or incur other obligations, on behalf of other participants without charge to any appropriation or contract authorization.</P>
                            <P>(3) Agency heads are authorized to solicit and award contracts to implement cooperative projects.</P>
                            <P>(b) Contracts implementing cooperative projects shall comply with all applicable laws relating to Government acquisition, unless a waiver is granted under 225.871-4. A waiver of certain laws and regulations may be obtained if the waiver—</P>
                            <P>(1) Is required by the terms of a written cooperative project agreement;</P>
                            <P>(2) Will significantly further NATO standardization, rationalization, and interoperability; and</P>
                            <P>(3) Is approved by the appropriate DoD official.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.871-4</SECTNO>
                            <SUBJECT>Statutory waivers.</SUBJECT>
                            <P>(a) For contracts or subcontracts placed outside the United States, the Deputy Secretary of Defense may waive any provision of law that specifically prescribes—</P>
                            <P>(1) Procedures for the formation of contracts;</P>
                            <P>(2) Terms and conditions for inclusion in contracts;</P>
                            <P>(3) Requirements or preferences for—</P>
                            <P>(i) Goods grown, produced, or manufactured in the United States or in U.S. Government-owned facilities; or</P>
                            <P>(ii) Services to be performed in the United States; or</P>
                            <P>(4) Requirements regulating the performance of contracts.</P>
                            <P>(b) There is no authority for waiver of—</P>
                            <P>(1) Any provision of the Arms Export Control Act (22 U.S.C. 2751);</P>
                            <P>(2) Any provision of 10 U.S.C. 3201-3205;</P>
                            <P>
                                (3) The cargo preference laws of the United States, including the Military Cargo Preference Act of 1904 (10 U.S.C. 
                                <PRTPAGE P="209"/>
                                2631) and the Cargo Preference Act of 1954 (46 U.S.C. 1241(b)); or
                            </P>
                            <P>(4) Any of the financial management responsibilities administered by the Secretary of the Treasury.</P>
                            <P>(c) To request a waiver under a cooperative project, follow the procedures at PGI 225.871-4.</P>
                            <P>(d) Obtain the approval of the Deputy Secretary of Defense before committing to make a waiver in an agreement or a contract.</P>
                            <CITA>[68 FR 15621, Mar. 31, 2003, as amended at 71 FR 62565, Oct. 26, 2006; 87 FR 76993, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.871-5</SECTNO>
                            <SUBJECT>Directed subcontracting.</SUBJECT>
                            <P>(a) The Principal Director, Defense Pricing, Contracting, and Acquisition Policy may authorize the direct placement of subcontracts with particular subcontractors. Directed subcontracting is not authorized unless specifically addressed in the cooperative project agreement.</P>
                            <P>(b) In some instances, it may not be feasible to name specific subcontractors at the time the agreement is concluded. However, the agreement shall clearly state the general provisions for work sharing at the prime and subcontract level. For additional information on cooperative project agreements, see PGI 225.871-5.</P>
                            <CITA>[68 FR 15621, Mar. 31, 2003, as amended at 70 FR 73155, Dec. 9, 2005; 88 FR 73236, Oct. 25, 2023; 89 FR 60831, July 29, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.871-6</SECTNO>
                            <SUBJECT>Disposal of property.</SUBJECT>
                            <P>Dispose of property that is jointly acquired by the members of a cooperative project under the procedures established in the agreement or in a manner consistent with the terms of the agreement, without regard to any laws of the United States applicable to the disposal of property owned by the United States.</P>
                            <CITA>[70 FR 73155, Dec. 9, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.871-7</SECTNO>
                            <SUBJECT>Congressional notification.</SUBJECT>
                            <P>(a) Congressional notification is required when DoD makes a determination to award a contract or subcontract to a particular entity, if the determination was not part of the certification made under 22 U.S.C. 2767(f) before finalizing the cooperative agreement.</P>
                            <P>(1) Departments and agencies shall provide a proposed Congressional notice to the Principal Director, Defense Pricing, Contracting, and Acquisition Policy in sufficient time to forward to Congress before the time of contract award.</P>
                            <P>(2) The proposed notice shall include the reason it is necessary to use the authority to designate a particular contractor or subcontractor.</P>
                            <P>(b) Congressional notification is also required each time a statutory waiver under 225.871-4 is incorporated in a contract or a contract modification, if such information was not provided in the certification to Congress before finalizing the cooperative agreement.</P>
                            <CITA>[68 FR 15621, Mar. 31, 2003, as amended at 88 FR 73236, Oct. 25, 2023; 89 FR 60831, July 29, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.872</SECTNO>
                            <SUBJECT>Contracting with qualifying country sources.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.872-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>(a) As a result of memoranda of understanding and other international agreements, DoD has determined it inconsistent with the public interest to apply restrictions of the Buy American statute or the Balance of Payments Program to the acquisition of qualifying country end products from the following qualifying countries:</P>
                            <EXTRACT>
                                <SCOL2>
                                    <LI>Australia</LI>
                                    <LI>Belgium</LI>
                                    <LI>Canada</LI>
                                    <LI>Czech Republic</LI>
                                    <LI>Denmark</LI>
                                    <LI>Egypt</LI>
                                    <LI>Estonia</LI>
                                    <LI>Federal Republic of Germany</LI>
                                    <LI>Finland</LI>
                                    <LI>France</LI>
                                    <LI>Greece</LI>
                                    <LI>Israel</LI>
                                    <LI>Italy</LI>
                                    <LI>Japan</LI>
                                    <LI>Latvia</LI>
                                    <LI>Lithuania</LI>
                                    <LI>Luxembourg</LI>
                                    <LI>Netherlands</LI>
                                    <LI>Norway</LI>
                                    <LI>Poland</LI>
                                    <LI>Portugal</LI>
                                    <LI>Slovenia</LI>
                                    <LI>Spain</LI>
                                    <LI>Sweden</LI>
                                    <LI>Switzerland</LI>
                                    <LI>Turkey</LI>
                                    <LI>United Kingdom of Great Britain and Northern Ireland.</LI>
                                </SCOL2>
                            </EXTRACT>
                            <P>
                                (b) Individual acquisitions of qualifying country end products from the following qualifying country may, on a purchase-by-purchase basis (see 225.872-4), be exempted from application of the Buy American statute and the Balance of Payments Program as inconsistent with the public interest: Austria.
                                <PRTPAGE P="210"/>
                            </P>
                            <P>(c) The determination in paragraph (a) of this subsection does not limit the authority of the Secretary concerned to restrict acquisitions to domestic sources or reject an otherwise acceptable offer from a qualifying country source when considered necessary for national defense reasons.</P>
                            <CITA>[68 FR 15621, Mar. 31, 2003, as amended at 69 FR 8116, Feb. 23, 2004; 75 FR 32641, June 8, 2010; 77 FR 35880, June 15, 2012; 77 FR 76942, Dec. 31, 2012; 81 FR 50651, Aug. 2, 2016; 81 FR 93840, Dec. 22, 2016; 82 FR 61484, Dec. 28, 2017; 87 FR 15816, Mar. 18, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.872-2</SECTNO>
                            <SUBJECT>Applicability.</SUBJECT>
                            <P>(a) This section applies to all acquisitions of supplies except those restricted by—</P>
                            <P>(1) U.S. National Disclosure Policy, DoDD 5230.11, Disclosure of Classified Military Information to Foreign Governments and International Organizations;</P>
                            <P>(2) U.S. defense mobilization base requirements purchased under the authority of FAR 6.302-3(a)(2)(i), except for quantities in excess of that required to maintain the defense mobilization base. This restriction does not apply to Canadian planned producers.</P>
                            <P>(i) Review individual solicitations to determine whether this restriction applies.</P>
                            <P>(ii) Information concerning restricted items may be obtained from the Deputy Assistant Secretary of Defense for Industrial Base Policy;</P>
                            <P>
                                (3) Other U.S. laws or regulations (
                                <E T="03">e.g.,</E>
                                 the annual DoD appropriations act); and
                            </P>
                            <P>(4) U.S. industrial security requirements.</P>
                            <P>(b) This section does not apply to construction contracts.</P>
                            <CITA>[68 FR 15621, Mar. 31, 2003, as amended at 88 FR 73236, Oct. 25, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.872-3</SECTNO>
                            <SUBJECT>Solicitation procedures.</SUBJECT>
                            <P>(a) Except for items developed under the U.S./Canadian Development Sharing Program, use the criteria for soliciting and awarding contracts to small business concerns under FAR Part 19 without regard to whether there are potential qualifying country sources for the end product. Do not consider an offer of a qualifying country end product if the solicitation is identified for the exclusive participation of small business concerns.</P>
                            <P>(b) Send solicitations directly to qualifying country sources. Solicit Canadian sources through the Canadian Commercial Corporation in accordance with 225.870.</P>
                            <P>(c) Use international air mail if solicitation destinations are outside the United States and security classification permits such use.</P>
                            <P>(d) If unusual technical or security requirements preclude the acquisition of otherwise acceptable defense equipment from qualifying country sources, review the need for such requirements. Do not impose unusual technical or security requirements solely for the purpose of precluding the acquisition of defense equipment from qualifying countries.</P>
                            <P>(e) Do not automatically exclude qualifying country sources from submitting offers because their supplies have not been tested and evaluated by the department or agency.</P>
                            <P>(1) Consider the adequacy of qualifying country service testing on a case-by-case basis. Departments or agencies that must limit solicitations to sources whose items have been tested and evaluated by the department or agency shall consider supplies from qualifying country sources that have been tested and accepted by the qualifying country for service use.</P>
                            <P>(2) The department or agency may perform a confirmatory test, if necessary.</P>
                            <P>(3) Apply U.S. test and evaluation standards, policies, and procedures when the department or agency decides that confirmatory tests of qualifying country end products are necessary.</P>
                            <P>(4) If it appears that these provisions might adversely delay service programs, obtain the concurrence of the Under Secretary of Defense (Acquisition and Sustainment), before excluding the qualifying country source from consideration.</P>
                            <P>
                                (f) Permit industry representatives from a qualifying country to attend symposia, program briefings, prebid conferences (see FAR 14.207 and 15.201(c)), and similar meetings that address U.S. defense equipment needs and 
                                <PRTPAGE P="211"/>
                                requirements. When practical, structure these meetings to allow attendance by representatives of qualifying country concerns.
                            </P>
                            <CITA>[68 FR 15621, Mar. 31, 2003, as amended at 72 FR 20758, Apr. 26, 2007; 88 FR 73237, Oct. 25, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.872-4</SECTNO>
                            <SUBJECT>Individual determinations.</SUBJECT>
                            <P>If the offer of an end product from a qualifying country source listed in 225.872-1(b), as evaluated, is low or otherwise eligible for award, prepare a determination and findings exempting the acquisition from the Buy American statute and the Balance of Payments Program as inconsistent with the public interest, unless another exception such as the Trade Agreements Act applies. Follow the procedures at PGI 225.872-4.</P>
                            <CITA>[70 FR 73155, Dec. 9, 2005, as amended at 77 FR 35880, June 15, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.872-5</SECTNO>
                            <SUBJECT>Contract administration.</SUBJECT>
                            <P>
                                (a) Arrangements exist with some qualifying countries to provide reciprocal contract administration services. Some arrangements are at no cost to either government. To determine whether such an arrangement has been negotiated and what contract administration functions are covered, contact the Office of the Principal Director, Defense Pricing, Contracting, and Acquisition Policy (Contract Policy) via email at 
                                <E T="03">osd.pentagon.ousd-a-s.mbx.asda-dp-c-contractpolicy@mail.mil.</E>
                            </P>
                            <P>(b) Follow the contract administration procedures at PGI 225.872-5(b).</P>
                            <P>(c) Information on quality assurance delegations to foreign governments is in Subpart 246.4, Government Contract Quality Assurance.</P>
                            <CITA>[68 FR 15621, Mar. 31, 2003, as amended at 70 FR 73155, Dec. 9, 2005; 72 FR 30278, May 31, 2007; 88 FR 73237, Oct. 25, 2023; 89 FR 60831, July 29, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.872-6</SECTNO>
                            <SUBJECT>Request for audit services.</SUBJECT>
                            <P>Handle requests for audit services in France, Germany, the Netherlands, or the United Kingdom in accordance with PGI 215.404-2(c), but follow the additional procedures at PGI 225.872-6.</P>
                            <CITA>[81 FR 59510, Aug. 30, 2016]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.872-7</SECTNO>
                            <SUBJECT>Industrial security for qualifying countries.</SUBJECT>
                            <P>The required procedures for safeguarding classified defense information necessary for the performance of contracts awarded to qualifying country sources are in the National Industrial Security Program Operating Manual, 32 CFR part 117 (implemented for the Army by AR 380-49; for the Navy by SECNAV Instruction 5510.1H; for the Air Force by AFI 31-601; for the Defense Information Systems Agency by DCA Instruction 240-110-8; and for the National Imagery and Mapping Agency by NIMA Instruction 5220.22).</P>
                            <CITA>[68 FR 15621, Mar. 31, 2003, as amended at 86 FR 3836, Jan. 15, 2021]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.872-8</SECTNO>
                            <SUBJECT>Subcontracting with qualifying country sources.</SUBJECT>
                            <P>In reviewing contractor subcontracting procedures, the contracting officer shall ensure that the contract does not preclude qualifying country sources from competing for subcontracts, except when restricted by national security interest reasons, mobilization base considerations, or applicable U.S. laws or regulations (see the clause at 252.225-7002, Qualifying Country Sources as Subcontractors).</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.873</SECTNO>
                            <SUBJECT>Waiver of United Kingdom commercial exploitation levies.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.873-1</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>DoD and the Government of the United Kingdom (U.K.) have agreed to waive U.K. commercial exploitation levies and U.S. nonrecurring cost recoupment charges on a reciprocal basis. For U.K. levies to be waived, the offeror or contractor shall identify the levies and the contracting officer shall request a waiver before award of the contract or subcontract under which the levies are charged.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.873-2</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>When an offeror or a contractor identifies a levy included in an offered or contract price, follow the procedures at PGI 225.873-2.</P>
                            <CITA>[70 FR 73155, Dec. 9, 2005]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <PRTPAGE P="212"/>
                        <HD SOURCE="HED">Subpart 225.9—Customs and Duties</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>68 FR 15626, Mar. 31, 2003, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>225.900-70</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <P>“Component,” as used in this subpart, means any item supplied to the Government as part of an end product or of another component.</P>
                            <CITA>[74 FR 68383, Dec. 24, 2009]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.901</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>
                                Unless the supplies are entitled to duty-free treatment under a special category in the Harmonized Tariff Schedule of the United States (
                                <E T="03">e.g.,</E>
                                 the Caribbean Basin Economic Recovery Act or a Free Trade Agreement), or unless the supplies already have entered into the customs territory of the United States and the contractor already has paid the duty, DoD will issue duty-free entry certificates for—
                            </P>
                            <P>(1) Qualifying country supplies (end products and components);</P>
                            <P>(2) Eligible products (end products but not components) under contracts covered by the World Trade Organization Government Procurement Agreement or a Free Trade Agreement; and</P>
                            <P>(3) Other foreign supplies for which the contractor estimates that duty will exceed $300 per shipment into the customs territory of the United States.</P>
                            <CITA>[68 FR 15626, Mar. 31, 2003, as amended at 69 FR 1928, Jan. 13, 2004; 70 FR 2363, Jan. 13, 2005; 81 FR 28732, May 10, 2016]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.902</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>Follow the entry and release procedures at PGI 225.902.</P>
                            <CITA>[70 FR 73155, Dec. 9, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.903</SECTNO>
                            <SUBJECT>Exempted supplies.</SUBJECT>
                            <P>(b)(i) For an explanation of the term “supplies,” see PGI 225.903(b)(i).</P>
                            <P>(ii) The duty-free certificate shall be printed, stamped, or typed on the face of, or attached to, Customs Form 7501. A duly designated officer or civilian official of the appropriate department or agency shall execute the certificate in the format provided at PGI 225.903(b)(ii).</P>
                            <CITA>[70 FR 73155, Dec. 9, 2005]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 225.10—Additional Foreign Acquisition Regulations</HD>
                        <SECTION>
                            <SECTNO>225.1070</SECTNO>
                            <SUBJECT>Clause deviations in overseas contracts.</SUBJECT>
                            <P>See 201.403(2) for approval authority for clause deviations in overseas contracts with governments of North Atlantic Treaty Organization (NATO) countries or other allies or with United Nations or NATO organizations.</P>
                            <CITA>[65 FR 19856, Apr. 13, 2000]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 225.11—Solicitation Provisions and Contract Clauses</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>68 FR 16526, Mar. 31, 2003, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>225.1100</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>This subpart prescribes the clauses that implement subparts 225.1 through 225.10. The clauses that implement subparts 225.70 through 225.75 are prescribed within those subparts.</P>
                            <CITA>[68 FR 16526, Mar. 31, 2003, as amended at 81 FR 17048, Mar. 25, 2016]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.1101</SECTNO>
                            <SUBJECT>Acquisition of supplies.</SUBJECT>
                            <P>(1) Use the basic or the alternate of the provision at 252.225-7000, Buy American—Balance of Payments Program Certificate, instead of the provision at FAR 52.225-2, Buy American Certificate, in any solicitation, including solicitations using FAR part 12 procedures for the acquisition of commercial products and commercial services, that includes the basic or the alternate of the clause at 252.225-7001, Buy American and Balance of Payments Program.</P>
                            <P>(i) Use the basic provision when the solicitation includes the basic clause or alternate II of the clause at 252.225-7001.</P>
                            <P>(ii) Use the alternate I provision when the solicitation includes alternate I or alternate III of the clause at 252.225-7001.</P>
                            <P>
                                (2)(i) Use the basic or an alternate of the clause at 252.225-7001, Buy American and Balance of Payments Program, instead of the clause at FAR 52.225-1, Buy American —Supplies, in solicitations and contracts, including solicitations and contracts using FAR 
                                <PRTPAGE P="213"/>
                                part 12 procedures for the acquisition of commercial products and commercial services, unless—
                            </P>
                            <P>(A) All line items will be acquired from a particular source or sources under the authority of FAR 6.302-3;</P>
                            <P>(B) All line items require domestic or qualifying country end products in accordance with subpart 225.70, but note that this exception does not apply if subpart 225.70 only requires manufacture of the end product in the United States or in the United States or Canada, without a corresponding requirement for use of domestic components;</P>
                            <P>
                                (C) The acquisition is for supplies for use within the United States and an exception to the Buy American statute applies, 
                                <E T="03">e.g.,</E>
                                 nonavailability or public interest (see FAR 25.103 and 225.103);
                            </P>
                            <P>(D) The acquisition is for supplies for use outside the United States and an exception to the Balance of Payments Program applies (see 225.7501);</P>
                            <P>(E) One or more of the basic or the alternates of the following clauses will apply to all line items in the contract:</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) 252.225-7021, Trade Agreements.
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) 252.225-7036, Buy American —Free Trade Agreements—Balance of Payments Program; or
                            </P>
                            <P>(F) All line items will be acquired using a procedure specified in 225.7703-1(a).</P>
                            <P>(ii) Use the basic clause if the acquisition is not of end products listed in 225.401-70 in support of operations in Afghanistan.</P>
                            <P>(iii) Use the alternate I clause when the acquisition is of end products listed in 225.401-70 in support of operations in Afghanistan.</P>
                            <P>(iv) Use alternate II of the clause in lieu of the basic clause in solicitations and contracts if—</P>
                            <P>(A) The acquisition is not of end products listed in 225.401-70 in support of operations in Afghanistan; and</P>
                            <P>(B) An alternate domestic content threshold will apply to the entire period of performance as approved by the senior procurement executive (see 225.101(d)).</P>
                            <P>(v) Use alternate III of the clause in lieu of Alternate I of the clause in solicitations and contracts if—</P>
                            <P>(A) The acquisition is of end products listed in 225.401-70 in support of operations in Afghanistan; and</P>
                            <P>(B) An alternate domestic content threshold will apply to the entire period of performance as approved by the senior procurement executive (see 225.101(d)).</P>
                            <P>(3) Use the clause at 252.225-7002, Qualifying Country Sources as Subcontractors, in solicitations and contracts that include the basic or one of the alternates of the following clauses:</P>
                            <P>(i) 252.225-7001, Buy American and Balance of Payments Program.</P>
                            <P>(ii) 252.225-7021, Trade Agreements.</P>
                            <P>(iii) 252.225-7036, Buy American —Free Trade Agreements—Balance of Payments Program.</P>
                            <P>(4) Use the clause at 252.225-7013, Duty-Free Entry, instead of the clause at FAR 52.225-8. Do not use the clause for acquisitions of supplies that will not enter the customs territory of the United States.</P>
                            <P>(5) Use the basic or the alternate of the provision at 252.225-7020, Trade Agreements Certificate, instead of the provision at FAR 52.225-6, Trade Agreements Certificate, in solicitations, including solicitations using FAR part 12 procedures for the acquisition of commercial products and commercial services, that include the basic or alternate II of the clause at 252.225-7021, Trade Agreements. If the solicitation includes the provision at FAR 52.204-7, do not separately list the provision 252.225-7020 in the solicitation.</P>
                            <P>(i) Use the basic provision if the solicitation includes the basic clause at 252.225-7021.</P>
                            <P>(ii) Use the alternate I provision if the solicitation includes alternate II of the clause at 252.225-7021.</P>
                            <P>
                                (6) Except as provided in paragraph (6)(iv) of this section, use the basic or an alternate of the clause at 252.225-7021, Trade Agreements, instead of the clause at FAR 52.225-5, Trade Agreements, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, if the World Trade Organization Government Procurement Agreement applies, 
                                <E T="03">i.e.,</E>
                                 the acquisition is of end products listed at 225.401-70, the value of the acquisition equals or exceeds $174,000, and none of the exceptions at 25.401(a) applies.
                                <PRTPAGE P="214"/>
                            </P>
                            <P>(i) Use the basic clause in solicitations and contracts that are not of end products in support of operations in Afghanistan, or that include the clause at 252.225-7024, Requirement for Products or Services from Afghanistan.</P>
                            <P>(ii) Use the alternate II clause in solicitations and contracts that do not include the clause at 252.225-7024, Requirement for Products or Services from Afghanistan, when the acquisition is of end products in support of operations in Afghanistan.</P>
                            <P>(iii) Use the alternate III clause in lieu of the basic clause in solicitations and contracts that are not of end products in support of operations in Afghanistan or that include the clause at 252.225-7024, Requirement for Products or Services from Afghanistan, when an alternate domestic content threshold will apply to the entire period of performance as approved by the senior procurement executive (see 225.101(d)).</P>
                            <P>(iv) Use the alternate IV clause in lieu of the alternate II clause in solicitations and contracts that do not include the clause at 252.225-7024, Requirement for Products or Services from Afghanistan, when—</P>
                            <P>(A) The acquisition is of end products in support of operations in Afghanistan; and</P>
                            <P>(B) An alternate domestic content threshold will apply to the entire period of performance as approved by the senior procurement executive (see 225.101(d)).</P>
                            <P>(v) Do not use the basic or an alternate of the clause if—</P>
                            <P>(A) Purchase from foreign sources is restricted, unless the contracting officer anticipates a waiver of the restriction; or</P>
                            <P>(B) The clause at 252.225-7026, Acquisition Restricted to Products or Services from Afghanistan, is included in the solicitation and contract.</P>
                            <P>(vi) The acquisition of eligible and noneligible products under the same contract may result in the application of trade agreements to only some of the items acquired. In such case, indicate in the Schedule those items covered by the Trade Agreements clause.</P>
                            <P>(7) Use the provision at 252.225-7032, Waiver of United Kingdom Levies—Evaluation of Offers, in solicitations if a U.K. firm is expected to—</P>
                            <P>(i) Submit an offer; or</P>
                            <P>(ii) Receive a subcontract exceeding $1 million.</P>
                            <P>(8) Use the clause at 252.225-7033, Waiver of United Kingdom Levies, in solicitations and contracts if a U.K. firm is expected to—</P>
                            <P>(i) Submit an offer; or</P>
                            <P>(ii) Receive a subcontract exceeding $1 million.</P>
                            <P>(9) Use the basic or an alternate of the provision at 252.225-7035, Buy American—Free Trade Agreements—Balance of Payments Program Certificate, instead of the provision at FAR 52.225-4, Buy American—Free Trade Agreements—Israeli Trade Act Certificate, in solicitations, including solicitations using FAR part 12 procedures for the acquisition of commercial products and commercial services, that include the basic or an alternate of the clause at 252.225-7036, Buy American—Free Trade Agreements—Balance of Payments Program.</P>
                            <P>(i) Use the basic provision in solicitations when the basic or alternate VI of the clause at 252.225-7036 is used.</P>
                            <P>(ii) Use the alternate I provision when the solicitation includes alternate I or alternate VII of the clause at 252.225-7036.</P>
                            <P>(iii) Use the alternate II provision when the solicitation includes alternate II or alternate VIII of the clause at 252.225-7036.</P>
                            <P>(iv) Use the alternate III provision when the solicitation includes alternate III or alternate IX of the clause at 252.225-7036.</P>
                            <P>(v) Use the alternate IV provision when the solicitation includes alternate IV or alternate X of the clause at 252.225-7036.</P>
                            <P>(vi) Use the alternate V provision when the solicitation includes alternate V or alternate XI of the clause at 252.225-7036.</P>
                            <P>
                                (10)(i) Except as provided in paragraph (10)(ii) of this section, use the basic or an alternate of the clause at 252.225-7036, Buy American—Free Trade Agreements—Balance of Payments Program, instead of the clause at FAR 52.225-3, Buy American—Free Trade Agreements—Israeli Trade Act, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition 
                                <PRTPAGE P="215"/>
                                of commercial products and commercial services, for the items listed at 225.401-70, when the estimated value is less than $174,000, unless an exception at FAR 25.401 or 225.401 applies.
                            </P>
                            <P>(A) Use the basic clause in solicitations and contracts when the estimated value equals or exceeds $100,000, but is less than $174,000, except if the acquisition is of end products in support of operations in Afghanistan.</P>
                            <P>(B) Use the alternate I clause in solicitations and contracts when the estimated value is less than $102,280, except if the acquisition is of end products in support of operations in Afghanistan.</P>
                            <P>(C) Use the alternate II clause in solicitations and contracts when the estimated value equals or exceeds $100,000 but is less than $174,000, and the acquisition is of end products in support of operations in Afghanistan.</P>
                            <P>(D) Use the alternate III clause in solicitations and contracts when the estimated value is less than $102,280, and the acquisition is of end products in support of operations in Afghanistan.</P>
                            <P>(E) Use the alternate IV clause in solicitations and contracts when the estimated value equals or exceeds $102,280 but is less than $174,000, except if the acquisition is of end products in support of operations in Afghanistan.</P>
                            <P>(F) Use the alternate V clause in solicitations and contracts when the estimated value equals or exceeds $102,280 but is less than $174,000 and the acquisition is of end products in support of operations in Afghanistan.</P>
                            <P>(G) Use the alternate VI clause in lieu of the basic clause in solicitations and contracts, except if the acquisition is of end products in support of operations in Afghanistan, when—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) The estimated value equals or exceeds $100,000 but is less than $174,000; and
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) An alternate domestic content threshold will apply to the entire period of performance as approved by the senior procurement executive (see 225.101(d)).
                            </P>
                            <P>(H) Use the alternate VII clause in lieu of the alternate I clause in solicitations and contracts, except if the acquisition is of end products in support of operations in Afghanistan, when—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) The estimated value is less than $102,280; and
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) An alternate domestic content threshold will apply to the entire period of performance as approved by the senior procurement executive (see 225.101(d)).
                            </P>
                            <P>(I) Use the alternate VIII clause in lieu of the alternate II clause in solicitations and contracts when—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) The estimated value equals or exceeds $100,000, but is less than $174,000;
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) The acquisition is of end products in support of operations in Afghanistan; and
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) An alternate domestic content threshold will apply to the entire period of performance as approved by the senior procurement executive (see 225.101(d)).
                            </P>
                            <P>(J) Use the alternate IX clause in lieu of the alternate III clause in solicitations and contracts when—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) The estimated value is less than $102,280;
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) The acquisition is of end products in support of operations in Afghanistan; and
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) An alternate domestic content threshold will apply to the entire period of performance as approved by the senior procurement executive in accordance with FAR 25.101(d).
                            </P>
                            <P>(K) Use the alternate X clause in lieu of the alternate IV clause in solicitations and contracts, except if the acquisition is of end products in support of operations in Afghanistan, when—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) The estimated value equals or exceeds $102,280 but is less than $174,000; and
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) An alternate domestic content threshold will apply to the entire period of performance as approved by the senior procurement executive (see 225.101(d)).
                            </P>
                            <P>(L) Use the alternate XI clause in lieu of the alternate V clause in solicitations and contracts when—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) The estimated value equals or exceeds $102,280 but is less than $174,000;
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) The acquisition is of end products in support of operations in Afghanistan; and
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) An alternate domestic content threshold will apply to the entire period of performance as approved by the senior procurement executive (see 225.101(d)).
                                <PRTPAGE P="216"/>
                            </P>
                            <P>(ii) Do not use the basic or an alternate of the clause in paragraph (10)(i) of this section if—</P>
                            <P>(A) Purchase from foreign sources is restricted (see 225.401(a)(2)), unless the contracting officer anticipates a waiver of the restriction;</P>
                            <P>(B) Acquiring information technology that is a commercial product, using fiscal year 2004 or subsequent funds section 535 of Division F of the Consolidated Appropriations Act, 2004 (Pub. L. 108-199), and the same provision in subsequent appropriations acts); or</P>
                            <P>(C) Using a procedure specified in 225.7703-1(a).</P>
                            <P>(iii) The acquisition of eligible and noneligible products under the same contract may result in the application of a Free Trade Agreement to only some of the items acquired. In such case, indicate in the Schedule those items covered by the Buy American —Free Trade Agreements—Balance of Payments Program clause.</P>
                            <CITA>[75 FR 81916, Dec. 29, 2010]</CITA>
                            <EDNOTE>
                                <HD SOURCE="HED">Editorial Note:</HD>
                                <P>
                                    For 
                                    <E T="04">Federal Register</E>
                                     citations affecting section 225.1101, see the List of CFR Sections Affected, which appears in the Finding Aids section of the printed volume and at 
                                    <E T="03">www.govinfo.gov.</E>
                                </P>
                            </EDNOTE>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.1103</SECTNO>
                            <SUBJECT>Other provisions and clauses.</SUBJECT>
                            <P>(1) Unless the contracting officer knows that the prospective contractor is not a domestic concern, use the clause at 252.225-7005, Identification of Expenditures in the United States, in solicitations and contracts that—</P>
                            <P>(i) Exceed the simplified acquisition threshold; and</P>
                            <P>(ii) Are for the acquisition of—</P>
                            <P>(A) Supplies for use outside the United States;</P>
                            <P>(B) Construction to be performed outside the United States; or</P>
                            <P>(C) Services to be performed primarily outside the United States.</P>
                            <P>(2) Use the clause at 252.225-7041, Correspondence in English, in solicitations and contracts when contract performance will be wholly or in part in a foreign country.</P>
                            <P>(3) Use the provision at 252.225-7042, Authorization to Perform, in solicitations when contract performance will be wholly or in part in a foreign country. If the solicitation includes the provision at FAR 52.204-7, do not separately list the provision 252.225-7042 in the solicitation.</P>
                            <P>(4) Unless an exception in 225.770-3 applies, use the clause at 252.225-7007, Prohibition on Acquisition of Certain Items from Communist Chinese Military Companies, in solicitations and contracts involving the delivery of items covered by the United States Munitions List or the 600 series of the Commerce Control List.</P>
                            <CITA>[68 FR 16526, Mar. 31, 2003, as amended at 71 FR 39006, July 11, 2006; 71 FR 53046, Sept. 8, 2006; 78 FR 37987, June 25, 2013; 78 FR 40043, July 3, 2013; 83 FR 66073, Dec. 21, 2018]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 225.70—Authorization Acts, Appropriations Acts, and Other Statutory Restrictions on Foreign Acquisition</HD>
                        <SECTION>
                            <SECTNO>225.7000</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>(a) This subpart contains restrictions on the acquisition of foreign products and services, imposed by DoD appropriations and authorization acts and other statutes. Refer to the acts to verify current applicability of the restrictions.</P>
                            <P>(b) Nothing in this subpart affects the applicability of the Buy American statute or the Balance of Payments Program.</P>
                            <CITA>[56 FR 36367, July 31, 1991, as amended at 62 FR 2856, Jan. 17, 1997; 68 FR 15627, Mar. 31, 2003; 77 FR 35880, June 15, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7001</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this subpart—</P>
                            <P>
                                <E T="03">Assembly</E>
                                 means an item forming a portion of a system or subsystem that—
                            </P>
                            <P>(1) Can be provisioned and replaced as an entity; and</P>
                            <P>(2) Incorporates multiple, replaceable parts.</P>
                            <P>
                                <E T="03">Bearing components</E>
                                 means the bearing element, retainer, inner race, or outer race.
                            </P>
                            <P>
                                <E T="03">Component</E>
                                 means any item supplied to the Government as part of an end item or of another component, except that for use in 225.7004-2(b)(6), the term means an article, material, or supply incorporated directly into an end product.
                            </P>
                            <P>
                                <E T="03">Covered country</E>
                                 means—
                                <PRTPAGE P="217"/>
                            </P>
                            <P>(1) The Democratic People's Republic of North Korea;</P>
                            <P>(2) The People's Republic of China;</P>
                            <P>(3) The Russian Federation; and</P>
                            <P>(4) The Islamic Republic of Iran (10 U.S.C. 4872 and 4875).</P>
                            <P>
                                <E T="03">End item,</E>
                                 as used in sections 225.7003 and 225.7018, means the final production product when assembled or completed and ready for delivery under a line item of the contract (10 U.S.C. 4863(m)).
                            </P>
                            <P>
                                <E T="03">End product</E>
                                 means supplies delivered under a line item of the contract.
                            </P>
                            <P>
                                <E T="03">Hand or measuring tools</E>
                                 means those tools listed in Federal supply classifications 51 and 52, respectively.
                            </P>
                            <P>
                                <E T="03">Large medium-speed diesel engines</E>
                                 means diesel engines whose revolutions per minute (RPM) fall between 300 and 1500 RPM with a displacement greater than 1500 cubic inches per cylinder.
                            </P>
                            <P>
                                <E T="03">Structural component of a tent</E>
                                —
                            </P>
                            <P>
                                (1) Means a component that contributes to the form and stability of the tent (
                                <E T="03">e.g.,</E>
                                 poles, frames, flooring, guy ropes, pegs); and
                            </P>
                            <P>(2) Does not include equipment such as heating, cooling, or lighting.</P>
                            <P>
                                <E T="03">Subsystem</E>
                                 means a functional grouping of items that combine to perform a major function within an end item, such as electrical power, altitude control, and propulsion.
                            </P>
                            <CITA>[84 FR 72243, Dec. 31, 2019, as amended at 87 FR 76993, Dec. 16, 2022; 88 FR 6603, Jan. 31, 2023; 88 FR 46902, July 20, 2023; 89 FR 46813, May 30, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7002</SECTNO>
                            <SUBJECT>Restrictions on food, clothing, fabrics, hand or measuring tools, and flags.</SUBJECT>
                            <CITA>[80 FR 51749, Aug. 26, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7002-1</SECTNO>
                            <SUBJECT>Restrictions.</SUBJECT>
                            <P>(a) The following restrictions implement 10 U.S.C. 4862 (the “Berry Amendment”). Except as provided in  225.7002-2, do not acquire—</P>
                            <P>(1) Any of the following items, either as end products or components, unless the items have been grown, reprocessed, reused, or produced in the United States:</P>
                            <P>(i) Food.</P>
                            <P>(ii) Clothing and the materials and components thereof, other than sensors, electronics, or other items added to, and not normally associated with, clothing and the materials and components thereof. Clothing includes items such as outerwear, headwear, underwear, nightwear, footwear, hosiery, handwear, belts, badges, and insignia. For additional guidance and examples, see PGI 225.7002-1(a)(1)(ii).</P>
                            <P>(iii)(A) Tents and the structural components of tents;</P>
                            <P>(B) Tarpaulins; or</P>
                            <P>(C) Covers.</P>
                            <P>(iv) Cotton and other natural fiber products.</P>
                            <P>(v) Woven silk or woven silk blends.</P>
                            <P>(vi) Spun silk yarn for cartridge cloth.</P>
                            <P>(vii) Synthetic fabric or coated synthetic fabric, including all textile fibers and yarns that are for use in such fabrics.</P>
                            <P>(viii) Canvas products.</P>
                            <P>(ix) Wool (whether in the form of fiber or yarn or contained in fabrics, materials, or manufactured articles).</P>
                            <P>(x) Any item of individual equipment (Product or Service Code (PSC) 8465) manufactured from or containing any of the fibers, yarns, fabrics, or materials listed in this paragraph (a)(1).</P>
                            <P>(2) Hand or measuring tools, unless the tools were produced in the United States. For additional guidance, see PGI 225.7002-1(a)(2).</P>
                            <P>
                                (b) In accordance with section 8123 of the Department of Defense Appropriations Act, 2014 (Pub. L. 113-76, division C, title VIII), and the same provision in subsequent Defense appropriations acts, except as provided in 225.7002-2, do not acquire a flag of the United States (PSC 8345), unless such flag, including the materials and components thereof, is manufactured in the United States, consistent with the requirements at 10 U.S.C. 4862. This restriction does not apply to the acquisition of any end items or components related to flying or displaying the flag (
                                <E T="03">e.g.,</E>
                                 flag poles and accessories).
                            </P>
                            <CITA>[67 FR 20697, Apr. 26, 2002, as amended at 71 FR 39009, July 11, 2006; 71 FR 58537, Oct. 4, 2006; 72 FR 2638, Jan. 22, 2007; 74 FR 37636, July 29, 2009; 76 FR 52133, Aug. 19, 2011; 77 FR 38736, June 29, 2012; 78 FR 13546, Feb. 28, 2013; 80 FR 51749, Aug. 26, 2015; 87 FR 76993, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="218"/>
                            <SECTNO>225.7002-2</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <P>Acquisitions in the following categories are not subject to the restrictions in 225.7002-1:</P>
                            <P>(a) Acquisitions not exceeding $150,000, except for athletic footwear purchased by DoD for use by members of the Army, Navy, Air Force, or Marine Corps upon their initial entry into the Armed Forces (37 U.S.C. 418(b)(4)).</P>
                            <P>
                                (b) Acquisitions of any of the items in 225.7002-1, if the Secretary concerned determines that items grown, reprocessed, reused, or produced in the United States cannot be acquired as and when needed in a satisfactory quality and sufficient quantity at U.S. market prices. (
                                <E T="03">See</E>
                                 the requirement in 205.301 for synopsis within 7 days after contract award when using this exception.)
                            </P>
                            <P>(1) The following officials are authorized, without power of redelegation, to make such a domestic nonavailability determination:</P>
                            <P>(i) The Under Secretary of Defense (Acquisition and Sustainment).</P>
                            <P>(ii) The Secretary of the Army.</P>
                            <P>(iii) The Secretary of the Navy.</P>
                            <P>(iv) The Secretary of the Air Force.</P>
                            <P>(v) The Director of the Defense Logistics Agency.</P>
                            <P>(2) The supporting documentation for the determination shall include an analysis and written certification by the requiring activity, with specificity, why alternatives that would not require a domestic nonavailability determination are unacceptable.</P>
                            <P>(3) Defense agencies other than the Defense Logistics Agency shall follow the procedures at PGI 225.7002-2(b)(3) when submitting a request for a domestic nonavailability determination.</P>
                            <P>(c) Acquisitions of items listed in FAR 25.104(a).</P>
                            <P>(d) Acquisitions outside the United States in support of combat operations.</P>
                            <P>(e) Acquisitions of perishable foods by or for activities located outside the United States for personnel of those activities.</P>
                            <P>(f) Acquisitions of food or hand or measuring tools—</P>
                            <P>(1) In support of contingency operations; or</P>
                            <P>(2) For which the use of other than competitive procedures has been approved on the basis of unusual and compelling urgency in accordance with FAR 6.302-2.</P>
                            <P>(g) Emergency acquisitions by activities located outside the United States for personnel of those activities.</P>
                            <P>(h) Acquisitions by vessels in foreign waters.</P>
                            <P>(i) Acquisitions of items specifically for commissary resale.</P>
                            <P>(j) Acquisitions of incidental amounts of cotton, other natural fibers, or wool incorporated in an end product, for which the estimated value of the cotton, other natural fibers, or wool—</P>
                            <P>(1) Is not more than 10 percent of the total price of the end product; and</P>
                            <P>(2) Does not exceed the threshold at 225.7002-2(a).</P>
                            <P>(k) Acquisitions of waste and byproducts of cotton or wool fiber for use in the production of propellants and explosives.</P>
                            <P>(l) Acquisitions of foods manufactured or processed in the United States, regardless of where the foods (and any component if applicable) were grown or produced. However, in accordance with section 8118 of the DoD Appropriations Act for Fiscal Year 2005 (Pub. L. 108-287), this exception does not apply to fish, shellfish, or seafood manufactured or processed in the United States or fish, shellfish, or seafood contained in foods manufactured or processed in the United States.</P>
                            <P>(m) Acquisitions of fibers and yarns that are for use in synthetic fabric or coated synthetic fabric (but not the purchase of the synthetic or coated synthetic fabric itself), if—</P>
                            <P>(1) The fabric is to be used as a component of an end product that is not a textile product. Examples of textile products, made in whole or in part of fabric, include—</P>
                            <P>(i) Draperies, floor coverings, furnishings, and bedding PSG 72, Household and Commercial Furnishings and Appliances);</P>
                            <P>(ii) Items made in whole or in part of fabric in PSG 83, Textile/leather/furs/apparel/findings/tents/flags, or Federal Supply Group 84, Clothing, Individual Equipment and Insignia;</P>
                            <P>(iii) Upholstered seats (whether for household, office, or other use); and</P>
                            <P>
                                (iv) Parachutes (Product or Service Group (PSG) 1670); or
                                <PRTPAGE P="219"/>
                            </P>
                            <P>(2) The fibers and yarns are para-aramid fibers and continuous filament para-aramid yarns manufactured in a qualifying country.</P>
                            <P>(n) Acquisitions of chemical warfare protective clothing when the acquisition furthers an agreement with a qualifying country. (See 225.003(10) and the requirement in 205.301 for synopsis within 7 days after contract award when using this exception.)</P>
                            <P>(o) Acquisitions that are interagency, State, or local purchases that are executed by DoD as a result of the transfer of contracts from the General Services Administration or for which DoD serves as an item manager for products on behalf of the General Services Administration. According to section 897 of the National Defense Authorization Act for Fiscal Year 2016 (Pub. L. 114-92), such contracts shall not be subject to requirements under subchapter II of chapter 385 (including 10 U.S.C. 4862), to the extent such contracts are for purchases of products by other Federal agencies or State or local governments.</P>
                            <CITA>[67 FR 20697, Apr. 26, 2002]</CITA>
                            <EDNOTE>
                                <HD SOURCE="HED">Editorial Note:</HD>
                                <P>
                                    For 
                                    <E T="04">Federal Register</E>
                                     citations affecting section 225.7002-2, see the List of CFR Sections Affected, which appears in the Finding Aids section of the printed volume and at 
                                    <E T="03">www.govinfo.gov.</E>
                                </P>
                            </EDNOTE>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7002-3</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>Unless an exception at 225.7002-2 applies—</P>
                            <P>(a) Use the clause at 252.225-7012, Preference for Certain Domestic Commodities, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services.</P>
                            <P>(b) Use the clause at 252.225-7015, Restriction on Acquisition of Hand or Measuring Tools, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, that exceed the threshold at 225.7002-2(a) that require delivery of hand or measuring tools.</P>
                            <P>(c) Use the clause at 252.225-7006, Acquisition of the American Flag, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, that are for the acquisition of the American flag, with an estimated value that exceeds the threshold at 225.7002-2(a).</P>
                            <CITA>[61 FR 50453, Sept. 26, 1996, as amended at 67 FR 20698, Apr. 26, 2002; 68 FR 15627, Mar. 31, 2003; 74 FR 37636, July 29, 2009; 78 FR 37987, June 25, 2013; 80 FR 51749, Aug. 26, 2015; 80 FR 67255, Oct. 30, 2015; 83 FR 65562, Dec. 21, 2018; 87 FR 25147, Apr. 28, 2022; 88 FR 6585, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7003</SECTNO>
                            <SUBJECT>Restrictions on acquisition of specialty metals.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7003-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this section—</P>
                            <P>
                                <E T="03">Alloy</E>
                                 means a metal consisting of a mixture of a basic metallic element and one or more metallic, or non-metallic, alloying elements.
                            </P>
                            <P>
                                (1) For alloys named by a single metallic element (
                                <E T="03">e.g.,</E>
                                 titanium alloy), it means that the alloy contains 50 percent or more of the named metal (by mass).
                            </P>
                            <P>
                                (2) If two metals are specified in the name (
                                <E T="03">e.g.,</E>
                                 nickel-iron alloy), those metals are the two predominant elements in the alloy, and together they constitute 50 percent or more of the alloy (by mass).
                            </P>
                            <P>
                                <E T="03">Automotive item</E>
                                —
                            </P>
                            <P>(1) Means a self-propelled military transport tactical vehicle, primarily intended for use by military personnel or for carrying cargo, such as—</P>
                            <P>(i) A high-mobility multipurpose wheeled vehicle;</P>
                            <P>(ii) An armored personnel carrier; or</P>
                            <P>(iii) A troop/cargo-carrying truckcar, truck, or van; and</P>
                            <P>(2) Does not include—</P>
                            <P>(i) A commercially available off-the-shelf vehicle; or</P>
                            <P>(ii) Construction equipment (such as bulldozers, excavators, lifts, or loaders) or other self-propelled equipment (such as cranes or aircraft ground support equipment).</P>
                            <P>
                                <E T="03">Commercial derivative military article</E>
                                 means an item acquired by the Department of Defense that is or will be produced using the same production facilities, a common supply chain, and the same or similar production processes 
                                <PRTPAGE P="220"/>
                                that are used for the production of articles predominantly used by the general public or by nongovernmental entities for purposes other than governmental purposes.
                            </P>
                            <P>
                                <E T="03">Electronic component</E>
                                 means an item that operates by controlling the flow of electrons or other electrically charged particles in circuits, using interconnections of electrical devices such as resistors, inductors, capacitors, diodes, switches, transistors, or integrated circuits. The term does not include structural or mechanical parts of an assembly containing an electronic component and does not include any high performance magnets that may be used in the electronic component.
                            </P>
                            <P>
                                <E T="03">High performance magnet</E>
                                 means a permanent magnet that obtains a majority of its magnetic properties from rare earth metals (such as samarium).
                            </P>
                            <P>
                                <E T="03">Produce</E>
                                 means—
                            </P>
                            <P>(1) Atomization;</P>
                            <P>(2) Sputtering; or</P>
                            <P>(3) Final consolidation of non-melt derived metal powders.</P>
                            <P>
                                <E T="03">Specialty metal</E>
                                 means—
                            </P>
                            <P>(1) Steel—</P>
                            <P>(i) With a maximum alloy content exceeding one or more of the following limits: manganese, 1.65 percent; silicon, 0.60 percent; or copper, 0.60 percent; or</P>
                            <P>(ii) Containing more than 0.25 percent of any of the following elements: aluminum, chromium, cobalt, molybdenum, nickel, niobium (columbium), titanium, tungsten, or vanadium;</P>
                            <P>(2) Metal alloys consisting of—</P>
                            <P>(i) Nickel or iron-nickel alloys that contain a total of alloying metals other than nickel and iron in excess of 10 percent; or</P>
                            <P>(ii) Cobalt alloys that contain a total of alloying metals other than cobalt and iron in excess of 10 percent;</P>
                            <P>(3) Titanium and titanium alloys; or</P>
                            <P>(4) Zirconium and zirconium alloys.</P>
                            <P>
                                <E T="03">Steel</E>
                                 means an iron alloy that includes between .02 and 2 percent carbon and may include other elements.
                            </P>
                            <CITA>[74 FR 37636, July 29, 2009, as amended at 84 FR 72243, Dec. 31, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7003-2</SECTNO>
                            <SUBJECT>Restrictions.</SUBJECT>
                            <P>(a) The following restrictions implement 10 U.S.C. 4863. Except as provided in 225.7003-3—</P>
                            <P>(1) Do not acquire the following items, or any components of the following items, unless any specialty metals contained in the items or components are melted or produced in the United States (also see guidance at PGI 225.7003-2(a)):</P>
                            <P>(i) Aircraft.</P>
                            <P>(ii) Missile or space systems.</P>
                            <P>(iii) Ships.</P>
                            <P>(iv) Tank or automotive items.</P>
                            <P>(v) Weapon systems.</P>
                            <P>(vi) Ammunition.</P>
                            <P>(2) Do not acquire a specialty metal (e.g., raw stock, including bar, billet, slab, wire, plate, and sheet; castings; and forgings) as an end item, unless the specialty metal is melted or produced in the United States. This restriction applies to specialty metal acquired by a contractor for delivery to DoD as an end item, in addition to specialty metal acquired by DoD directly from the entity that melted or produced the specialty metal.</P>
                            <P>
                                (b) For more information on specialty metals restrictions and reporting of noncompliances, see 
                                <E T="03">https://www.acq.osd.mil/asda/dpc/cp/ic/specialty-metals-restrictions.html.</E>
                            </P>
                            <CITA>[74 FR 37636, July 29, 2009, as amended at 81 FR 28730, May 10, 2016; 87 FR 15818, Mar. 18, 2022; 87 FR 76994, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7003-3</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <P>(a) Acquisitions in the following categories are not subject to the restrictions in 225.7003-2:</P>
                            <P>(1) Acquisitions at or below the simplified acquisition threshold.</P>
                            <P>(2) Acquisitions outside the United States in support of combat operations.</P>
                            <P>(3) Acquisitions in support of contingency operations.</P>
                            <P>(4) Acquisitions for which the use of other than competitive procedures has been approved on the basis of unusual and compelling urgency in accordance with FAR 6.302-2.</P>
                            <P>(5) Acquisitions of items specifically for commissary resale.</P>
                            <P>(6) Acquisitions of items for test and evaluation under the foreign comparative testing program (10 U.S.C. 2350a(g)). However, this exception does not apply to any acquisitions under follow-on production contracts.</P>
                            <P>
                                (b) One or more of the following exceptions may apply to an end item or 
                                <PRTPAGE P="221"/>
                                component that includes any of the following, under a prime contract or subcontract at any tier. The restrictions in 225.7003-2 do not apply to the following:
                            </P>
                            <P>(1) Electronic components, unless the Secretary of Defense, upon the recommendation of the Strategic and Critical Materials Board of Directors pursuant to 50 U.S.C. 98h-1, determines that the domestic availability of a particular electronic component is critical to national security.</P>
                            <P>(2)(i) Commercially available off-the-shelf (COTS) items containing specialty metals, except the restrictions do apply to contracts or subcontracts for the acquisition of—</P>
                            <P>(A) Specialty metal mill products, such as bar, billet, slab, wire, plate, and sheet, that have not been incorporated into end items, subsystems, assemblies, or components. Specialty metal supply contracts issued by COTS producers are not subcontracts for the purposes of this exception;</P>
                            <P>(B) Forgings or castings of specialty metals, unless the forgings or castings are incorporated into COTS end items, subsystems, or assemblies;</P>
                            <P>(C) Commercially available high performance magnets that contain specialty metal, unless such high performance magnets are incorporated into COTS end items or subsystems (see PGI 225.7003-3(b)(6) for a table of applicability of specialty metals restrictions to magnets); and</P>
                            <P>(D) COTS fasteners, unless—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) The fasteners are incorporated into COTS end items, subsystems, or assemblies; or
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) The fasteners qualify for the commercial product exception in paragraph (b)(3) of this section.
                            </P>
                            <P>(ii) If this exception is used for an acquisition of COTS end items valued at $5 million or more per item, the acquiring department or agency shall submit an annual report to the Principal Director, Defense Pricing, Contracting, and Acquisition Policy, in accordance with the procedures at PGI 225.7003-3(b)(2).</P>
                            <P>(3) Fasteners that are commercial products and are acquired under a contract or subcontract with a manufacturer of such fasteners, if the manufacturer has certified that it will purchase, during the relevant calendar year, an amount of domestically melted or produced specialty metal, in the required form, for use in the production of fasteners for sale to DoD and other customers, that is not less than 50 percent of the total amount of the specialty metal that the manufacturer will purchase to carry out the production of such fasteners for all customers.</P>
                            <P>(4) Items listed in 225.7003-2(a), manufactured in a qualifying country or containing specialty metals melted or produced in a qualifying country.</P>
                            <P>
                                (5) Specialty metal in any of the items listed in 225.7003-2 if the USD(A&amp;S), or an official authorized in accordance with paragraph (b)(5)(i) of this section, determines that specialty metal melted or produced in the United States cannot be acquired as and when needed at a fair and reasonable price in a satisfactory quality, a sufficient quantity, and the required form (
                                <E T="03">i.e.,</E>
                                 a domestic nonavailability determination). In accordance with 10 U.S.C. 4863(m)(4), the term “required form” in this section refers to the form of the mill product, such as bar, billet, wire, slab, plate, or sheet, in the grade appropriate for the production of a finished end item to be delivered to the Government under this contract; or a finished component assembled into an end item to be delivered to the Government under the contract. See guidance in PGI 225.7003-3(b)(5).
                            </P>
                            <P>(i) The Secretary of the military department concerned is authorized, without power of redelegation, to make a domestic nonavailability determination that applies to only one contract. The supporting documentation for the determination shall include an analysis and written documentation by the requiring activity, with specificity, why alternatives that would not require a domestic nonavailability determination are unacceptable.</P>
                            <P>
                                (ii) A domestic nonavailability determination that applies to more than one contract (
                                <E T="03">i.e.,</E>
                                 a class domestic nonavailability determination), requires the approval of the USD(A&amp;S).
                            </P>
                            <P>
                                (A) At least 30 days before making a domestic nonavailability determination that would apply to more than one contract, the USD(A&amp;S) will, to the 
                                <PRTPAGE P="222"/>
                                maximum extent practicable, and in a manner consistent with the protection of national security and confidential business information—
                            </P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Publish a notice in the Governmentwide point of entry (GPE) (
                                <E T="03">https://www.sam.gov</E>
                                ) of the intent to make the domestic nonavailability determination; and
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Solicit information relevant to such notice from interested parties, including producers of specialty metal mill products.
                            </P>
                            <P>(B) The USD(A&amp;S)—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Will take into consideration all information submitted in response to the notice in making a class domestic nonavailability determination;
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) May consider other relevant information that cannot be made part of the public record consistent with the protection of national security information and confidential business information; and
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) Will ensure that any such domestic nonavailability determination and the rationale for the determination are made publicly available to the maximum extent consistent with the protection of national security and confidential business information.
                            </P>
                            <P>
                                (6) End items containing a minimal amount of otherwise noncompliant specialty metals (
                                <E T="03">i.e.,</E>
                                 specialty metals not melted or produced in the United States that are not covered by another exception listed in this paragraph (b)), if the total weight of noncompliant specialty metal does not exceed 2 percent of the total weight of all specialty metal in the end item. This exception does not apply to high performance magnets containing specialty metals. See PGI 225.7003-3(b)(6) for a table of applicability of specialty metals restrictions to magnets.
                            </P>
                            <P>
                                (c) 
                                <E T="03">Compliance for commercial derivative military articles.</E>
                                 The restrictions at 225.7003-2(a) do not apply to an item acquired under a prime contract if—
                            </P>
                            <P>(1) The offeror has certified, and subsequently demonstrates, that the offeror and its subcontractor(s) will individually or collectively enter into a contractual agreement or agreements to purchase a sufficient quantity of domestically melted or produced specialty metal in accordance with the provision at 252.225-7010; and</P>
                            <P>(2) The USD(A&amp;S), or the Secretary of the military department concerned, determines that the item is a commercial derivative military article (defense agencies see procedures at PGI 225.7003-3(c)). The contracting officer shall submit the offeror's certification and a request for a determination to the appropriate official, through agency channels, and shall notify the offeror when a decision has been made.</P>
                            <P>
                                (d) 
                                <E T="03">National security waiver.</E>
                                 The USD(A&amp;S) may waive the restrictions at 225.7003-2 if the USD(A&amp;S) determines in writing that acceptance of the item is necessary to the national security interests of the United States (
                                <E T="03">see</E>
                                 procedures at PGI 225.7003-3(d). This authority may not be delegated.
                            </P>
                            <P>(1) The written determination of the USD(A&amp;S)—</P>
                            <P>(i) Shall specify the quantity of end items to which the national security waiver applies;</P>
                            <P>(ii) Shall specify the time period over which the national security waiver applies; and</P>
                            <P>(iii) Shall be provided to the congressional defense committees before the determination is executed, except that in the case of an urgent national security requirement, the determination may be provided to the congressional defense committees up to 7 days after it is executed.</P>
                            <P>(2) After making such a determination, the USD(A&amp;S) will—</P>
                            <P>(i) Ensure that the contractor or subcontractor responsible for the noncompliant specialty metal develops and implements an effective plan to ensure future compliance; and</P>
                            <P>(ii) Determine whether or not the noncompliance was knowing and willful. If the USD(A&amp;S) determines that the noncompliance was knowing and willful, the appropriate debarring and suspending official shall consider suspending or debarring the contractor or subcontractor until such time as the contractor or subcontractor has effectively addressed the issues that led to the noncompliance.</P>
                            <P>
                                (3) Because national security waivers will only be granted when the acquisition in question is necessary to the national security interests of the United States, the requirement for a plan will be applied as a condition subsequent, 
                                <PRTPAGE P="223"/>
                                and not a condition precedent, to the granting of a waiver.
                            </P>
                            <CITA>[74 FR 37636, July 29, 2009, as amended at 75 FR 48280, Aug. 10, 2010; 79 FR 17446, Mar. 28, 2014; 84 FR 72244, Dec. 31, 2019; 85 FR 61502, Sept. 29, 2020; 87 FR 76994, Dec. 16, 2022; 88 FR 6584, Jan. 31, 2023; 88 FR 73237, Oct. 25, 2023; 88 FR 88533, Dec. 22, 2023; 89 FR 60831, July 29, 2024; 89 FR 66286, Aug. 15, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7003-4</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7003-5</SECTNO>
                            <SUBJECT>Solicitation provision and contract clauses.</SUBJECT>
                            <P>(a) Unless the acquisition is wholly exempt from the specialty metals restrictions at 225.7003-2 because the acquisition is covered by an exception in 225.7003-3(a) or (d) (but see paragraph (d) of this section)—</P>
                            <P>(1) Use the clause at 252.225-7008, Restriction on Acquisition of Specialty Metals, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, that—</P>
                            <P>(i) Exceed the simplified acquisition threshold; and</P>
                            <P>(ii) Require the delivery of specialty metals as end items.</P>
                            <P>(2) Use the clause at 252.225-7009, Restriction on Acquisition of Certain Articles Containing Specialty Metals, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, that—</P>
                            <P>(i) Exceed the simplified acquisition threshold; and</P>
                            <P>(ii) Require delivery of any of the following items, or components of the following items, if such items or components contain specialty metal:</P>
                            <P>(A) Aircraft.</P>
                            <P>(B) Missile or space systems.</P>
                            <P>(C) Ships.</P>
                            <P>(D) Tank or automotive items.</P>
                            <P>(E) Weapon systems.</P>
                            <P>(F) Ammunition.</P>
                            <P>(b) Use the provision at 252.225-7010, Commercial Derivative Military Article—Specialty Metals Compliance Certificate, in solicitations, including solicitations using FAR part 12 procedures for the acquisition of commercial products and commercial services—</P>
                            <P>(1) That contain the clause at 252.225-7009; and</P>
                            <P>(2) For which the contracting officer anticipates that one or more offers of commercial derivative military articles may be received.</P>
                            <P>(c) If an agency cannot reasonably determine at time of acquisition whether some or all of the items will be used in support of combat operations or in support of contingency operations, the contracting officer should not rely on the exception at 225.7003-3(a)(2) or (3), but should include the appropriate specialty metals clause or provision in the solicitation and contract.</P>
                            <P>(d) If the solicitation and contract require delivery of a variety of contract line items containing specialty metals, but only some of the items are subject to domestic specialty metals restrictions, identify in the Schedule those items that are subject to the restrictions.</P>
                            <CITA>[74 FR 37636, July 29, 2009; 75 FR 48280, Aug. 10, 2010; 78 FR 37987, June 25, 2013; 88 FR 6584, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7004</SECTNO>
                            <SUBJECT>Restrictions on the procurement of goods other than U.S. goods.</SUBJECT>
                            <CITA>[89 FR 46813, May 30, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7004-0</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>This section implements 10 U.S.C. 4864.</P>
                            <CITA>[89 FR 46813, May 30, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7004-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this section—</P>
                            <P>
                                <E T="03">National technology and industrial base</E>
                                 means the persons and organizations that are engaged in production activities conducted within the United States, Australia, Canada, New Zealand, and the United Kingdom of Great Britain and Northern Ireland (United Kingdom). (10 U.S.C. 4801)
                            </P>
                            <P>
                                <E T="03">Star tracker</E>
                                 means a navigational tool used in a satellite weighing more than 400 pounds whose principal purpose is to support the national security, defense, or intelligence needs of the U.S. Government.
                            </P>
                            <CITA>[89 FR 46813, May 30, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="224"/>
                            <SECTNO>225.7004-2</SECTNO>
                            <SUBJECT>Restrictions.</SUBJECT>
                            <P>Except as provided in 225.7004-3, do not acquire any of the following items, either as end products or components, unless the manufacturer of the items is part of the national technology and industrial base:</P>
                            <P>(a) Buses, if multipassenger motor vehicles are purchased, leased, rented, or made available under contracts for transportation services.</P>
                            <P>(b) Components for naval vessels, to the extent they are unique to marine applications (see also 225.7004-4 for implementation of the restriction for naval vessels):</P>
                            <P>(1) Gyrocompasses.</P>
                            <P>(2) Electronic navigation chart systems.</P>
                            <P>(3) Steering controls.</P>
                            <P>(4) Propulsion and machinery control systems.</P>
                            <P>(5) Totally enclosed lifeboats.</P>
                            <P>(6) Welded shipboard anchor and mooring chain. See also 225.7004-5.</P>
                            <P>(c) Large medium-speed diesel engines for new construction of auxiliary ships using funds available for National Defense Sealift Fund programs or Shipbuilding and Conversion, Navy.</P>
                            <P>(d) For T-AO 205 and T-ARC class vessels:</P>
                            <P>(1) Auxiliary equipment, including pumps, for all shipboard services.</P>
                            <P>(2) Propulsion system components, including engines, reduction gears, and propellers.</P>
                            <P>(3) Shipboard cranes.</P>
                            <P>(4) Spreaders for shipboard cranes.</P>
                            <P>(e) Star trackers.</P>
                            <CITA>[89 FR 46813, May 30, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7004-3</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Contracts under the simplified acquisition threshold.</E>
                                 The restrictions at 225.7004-2 do not apply to a contract or subcontract that does not exceed the simplified acquisition threshold.
                            </P>
                            <P>
                                (b) 
                                <E T="03">Buses.</E>
                                 The restriction at 225.7004-2(a) does not apply in the following circumstances:
                            </P>
                            <P>(1) Buses manufactured outside the national technology and industrial base are needed for temporary use because buses manufactured in the national technology and industrial base are not available to satisfy requirements that cannot be postponed. Such use may not, however, exceed the lead time required for acquisition and delivery of buses manufactured in the national technology and industrial base.</P>
                            <P>(2) The requirement for buses is temporary in nature. For example, to meet a special, nonrecurring requirement or a sporadic and infrequent recurring requirement, buses manufactured outside the national technology and industrial base may be used for temporary periods of time. Such use may not however, exceed the period of time needed to meet the special requirement.</P>
                            <P>(3) Buses manufactured outside the national technology and industrial base are available at no cost to the U.S. Government.</P>
                            <P>
                                (c) 
                                <E T="03">Components for naval vessels.</E>
                                 The restriction at 225.7004-2(b) does not apply to acquisition of spare or repair parts needed to support components for naval vessels manufactured outside the United States. Support includes the purchase of spare gyrocompasses, electronic navigation chart systems, steering controls, propulsion and machinery control systems, totally enclosed lifeboats, and welded shipboard anchor and mooring chain.
                            </P>
                            <P>
                                (d) 
                                <E T="03">Components for auxiliary ships.</E>
                                 The restriction at 225.7004-2(c) does not apply to large medium-speed engines for icebreakers or special mission ships.
                            </P>
                            <P>
                                (e) 
                                <E T="03">Star trackers.</E>
                                 The restriction at 225.7004-2(e) does not apply to acquisition programs that have received Milestone A approval as defined in 10 U.S.C. 4211 before October 1, 2021, as documented by the requiring activity official performing program management responsibilities. The contracting officer shall include the Milestone A approval documentation in the contract file.
                            </P>
                            <CITA>[89 FR 46813, May 30, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7004-4</SECTNO>
                            <SUBJECT>Implementation of restriction on certain naval vessel components.</SUBJECT>
                            <P>(a) The statute at 10 U.S.C. 4864(h) prohibits the use of contract clauses or certifications to implement the restriction at 225.7004-2(b) for naval vessel components.</P>
                            <P>
                                (b) Agencies shall accomplish implementation of the restriction at 
                                <PRTPAGE P="225"/>
                                225.7004-2(b) through use of management and oversight techniques that achieve the objectives of this section without imposing a significant management burden on the Government or the contractor involved.
                            </P>
                            <CITA>[89 FR 46813, May 30, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7004-5</SECTNO>
                            <SUBJECT>Additional restrictions on anchor and mooring chain.</SUBJECT>
                            <P>(a) In accordance with section 8041 of the Fiscal Year 1991 DoD Appropriations Act (Pub. L. 101-511) and similar sections in subsequent DoD appropriations acts, do not acquire welded shipboard anchor and mooring chain, unless—</P>
                            <P>(1) It is manufactured in the United States, including cutting, heat treating, quality control, testing, and welding (both forging and shot blasting process); and</P>
                            <P>(2) The cost of the components manufactured in the United States exceeds 50 percent of the total cost of components.</P>
                            <P>(b) The statute at 10 U.S.C. 4864 also restricts acquisition of welded shipboard anchor and mooring chain, when used as a component of a naval vessel; however, the Appropriations Act restriction described in paragraph (a) of this section takes precedence over the restriction of 10 U.S.C. 4864 cited in 225.7004-2(b)(6).</P>
                            <CITA>[89 FR 46814, May 30, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7004-6</SECTNO>
                            <SUBJECT>Waiver of restrictions.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Welded shipboard anchor and mooring chain.</E>
                                 (1) In accordance with section 8016 of the Consolidated Appropriations Act, 2023 (Pub. L. 117-328), the secretary of the department responsible for acquisition may waive the restrictions in 225.7004-2(b)(6) and 225.7004-5, on a case-by-case basis, if—
                            </P>
                            <P>(i) Sufficient domestic suppliers are not available to meet DoD requirements on a timely basis; and</P>
                            <P>(ii) The acquisition is necessary to acquire capability for national security purposes.</P>
                            <P>(2) Document the waiver in a written determination and findings containing—</P>
                            <P>(i) The factors supporting the waiver; and</P>
                            <P>(ii) A certification that the acquisition must be made in order to acquire capability for national security purposes.</P>
                            <P>(3) Provide a copy of the determination and findings to the House and Senate Committees on Appropriations.</P>
                            <P>
                                (b) 
                                <E T="03">Star trackers.</E>
                                 The waiver criteria at paragraph (c) of this section apply, except that the USD(A&amp;S) may delegate the authority to waive a restriction for a star tracker for a particular foreign country to the service acquisition executive, without power of redelegation (section 1603, National Defense Authorization Act for Fiscal Year 2021 (Pub. L. 116-283)).
                            </P>
                            <P>
                                (c) 
                                <E T="03">Waiver of restrictions of 10 U.S.C. 4864(a).</E>
                                 The restrictions on certain foreign purchases at 225.7004-2 may be waived, except as provided in paragraphs (a) and (b) of this section, as follows:
                            </P>
                            <P>(1)(i) USD(A&amp;S), without power of delegation, may waive a restriction for a particular item for a particular foreign country upon determination that—</P>
                            <P>(A) U.S. producers of the item would not be jeopardized by competition from a foreign country, and that country does not discriminate against defense items produced in the United States to a greater degree than the United States discriminates against defense items produced in that country; or</P>
                            <P>(B) Application of the restriction would impede cooperative programs entered into between DoD and a foreign country, or would impede the reciprocal procurement of defense items under a memorandum of understanding providing for reciprocal procurement of defense items under 225.872, and that country does not discriminate against defense items produced in the United States to a greater degree than the United States discriminates against defense items produced in that country.</P>
                            <P>
                                (ii) A notice of the determination to exercise the waiver authority shall be published in the 
                                <E T="04">Federal Register</E>
                                 and submitted to the congressional defense committees at least 15 days before the effective date of the waiver.
                            </P>
                            <P>
                                (iii) The effective period of the waiver shall not exceed 1 year.
                                <PRTPAGE P="226"/>
                            </P>
                            <P>(iv) For contracts entered into prior to the effective date of a waiver, provided adequate consideration is received to modify the contract, the waiver shall be applied as directed or authorized in the waiver to—</P>
                            <P>(A) Subcontracts entered into on or after the effective date of the waiver; and</P>
                            <P>(B) Options for the procurement of items that are exercised after the effective date of the waiver, if the option prices are adjusted for any reason other than the application of the waiver.</P>
                            <P>(2) The head of the contracting activity may waive a restriction on a case-by-case basis upon execution of a determination and findings that any of the following applies:</P>
                            <P>(i) The restriction would cause unreasonable delays.</P>
                            <P>(ii) Satisfactory quality items manufactured in the national technology and industrial base are not available.</P>
                            <P>(iii) Application of the restriction would result in the existence of only one source for the item in the national technology and industrial base.</P>
                            <P>(iv) Application of the restriction is not in the national security interests of the United States.</P>
                            <P>(v) Application of the restriction would adversely affect a U.S. company.</P>
                            <P>(3) A restriction is waived when it would cause unreasonable costs. The cost of an item of national technology and industrial base origin is unreasonable if it exceeds 150 percent of the offered price, inclusive of duty, of items that are not of national technology and industrial base origin.</P>
                            <CITA>[89 FR 46814, May 30, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7004-7</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>(a) Unless a waiver has been granted, use the clause at 252.225-7019, Restriction on Acquisition of Anchor and Mooring Chain, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, that exceed the simplified acquisition threshold and that require welded shipboard anchor or mooring chain.</P>
                            <P>(b) Use the clause at 252.225-7062, Restriction on Acquisition of Large Medium-Speed Diesel Engines, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, that exceed the simplified acquisition threshold and that require large medium-speed diesel engines for new construction of auxiliary ships using funds available for National Defense Sealift Fund programs or Shipbuilding and Conversion, Navy unless—</P>
                            <P>(1) An exception at 225.7004-3(d) applies; or</P>
                            <P>(2) A waiver has been granted.</P>
                            <P>(c) Unless a waiver has been granted, use the clause at 252.225-7063, Restriction on Acquisition of Components of T-AO 205 and T-ARC Class Vessels, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, that exceed the simplified acquisition threshold and that require components of T-AO 205 and T-ARC class vessels.</P>
                            <P>(d) Use the clause at 252.225-7064, Restriction on Acquisition of Certain Satellite Components, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, that exceed the simplified acquisition threshold and that include the acquisition of star trackers unless—</P>
                            <P>(1) An exception at 225.7004-3(e) applies; or</P>
                            <P>(2) A waiver has been granted.</P>
                            <CITA>[89 FR 46814, May 30, 2024, as amended at 89 FR 48330, June 6, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7005-225.7008</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7009</SECTNO>
                            <SUBJECT>Restriction on ball and roller bearings.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7009-1</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>This section implements section 8065 of the Fiscal Year 2002 DoD Appropriations Act (Pub. L. 107-117) and the same restriction in subsequent DoD appropriations acts.</P>
                            <CITA>[71 FR 14111, Mar. 21, 2006, as amended at 89 FR 46815, May 30, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7009-2</SECTNO>
                            <SUBJECT>Restriction.</SUBJECT>
                            <P>
                                (a) Do not acquire ball and roller bearings unless—
                                <PRTPAGE P="227"/>
                            </P>
                            <P>(1) The bearings are manufactured in the United States or Canada; and</P>
                            <P>(2) For each ball or roller bearing, the cost of the bearing components manufactured in the United States or Canada exceeds 50 percent of the total cost of the bearing components of that ball or roller bearing.</P>
                            <P>(b) The restriction at 225.7003-2 may also apply to bearings that are made from specialty metals, such as high carbon chrome steel (bearing steel).</P>
                            <CITA>[75 FR 76300, Dec. 8, 2010, as amended at 76 FR 32843, June 6, 2011; ]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7009-3</SECTNO>
                            <SUBJECT>Exception.</SUBJECT>
                            <P>The restriction in 225.7009-2 does not apply to contracts or subcontracts for the acquisition of commercial products, except for commercial ball and roller bearings acquired as end items.</P>
                            <CITA>[71 FR 14111, Mar. 21, 2006, as amended at 88 FR 6584, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7009-4</SECTNO>
                            <SUBJECT>Waiver.</SUBJECT>
                            <P>The Secretary of the department responsible for acquisition or, for the Defense Logistics Agency, the Component Acquisition Executive, may waive the restriction in 225.7009-2, on a case-by-case basis, by certifying to the House and Senate Committees on Appropriations that—</P>
                            <P>(a) Adequate domestic supplies are not available to meet DoD requirements on a timely basis; and</P>
                            <P>(b) The acquisition must be made in order to acquire capability for national security purposes.</P>
                            <CITA>[71 FR 14111, Mar. 21, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7009-5</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at 252.225-7016, Restriction on Acquisition of Ball and Roller Bearings, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, unless—</P>
                            <P>(a) The items being acquired are commercial products other than ball or roller bearings acquired as end items;</P>
                            <P>(b) The items being acquired do not contain ball and roller bearings; or</P>
                            <P>(c) A waiver has been granted in accordance with 225.7009-4.</P>
                            <CITA>[71 FR 14112, Mar. 21, 2006, as amended at 78 FR 37988, June 25, 2013; 88 FR 6584, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7010</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7011</SECTNO>
                            <SUBJECT>Restriction on carbon, alloy, and armor steel plate.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7011-1</SECTNO>
                            <SUBJECT>Restriction.</SUBJECT>
                            <P>
                                (a) In accordance with Section 8111 of the Fiscal Year 1992 DoD Appropriations Act (Pub. L. 102-172) and similar sections in subsequent DoD appropriations acts, do not acquire any of the following types of carbon, alloy, or armor steel plate for use in a Government-owned facility or a facility under the control of (
                                <E T="03">e.g.</E>
                                , leased by) DoD, unless it is melted and rolled in the United States or Canada:
                            </P>
                            <P>(1) Carbon, alloy, or armor steel plate in Federal Supply Class 9515.</P>
                            <P>(2) Carbon, alloy, or armor steel plate described by specifications of the American Society for Testing Materials or the American Iron and Steel Institute.</P>
                            <P>(b) This restriction—</P>
                            <P>(1) Applies to the acquisition of carbon, alloy, or armor steel plate as a finished steel mill product that may be used “as is” or may be used as an intermediate material for the fabrication of an end product; and</P>
                            <P>
                                (2) Does not apply to the acquisition of an end product (
                                <E T="03">e.g.</E>
                                , a machine tool), to be used in the facility, that contains carbon, alloy, or armor steel plate as a component.
                            </P>
                            <CITA>[71 FR 75894, Dec. 19, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7011-2</SECTNO>
                            <SUBJECT>Waiver.</SUBJECT>
                            <P>The Secretary of the department responsible for acquisition may waive this restriction, on a case-by-case basis, by certifying to the House and Senate Committees on Appropriations that—</P>
                            <P>(a) Adequate U.S. or Canadian supplies are not available to meet DoD requirements on a timely basis; and</P>
                            <P>(b) The acquisition must be made in order to acquire capability for national security purposes.</P>
                            <CITA>[68 FR 15627, Mar. 31, 2003]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="228"/>
                            <SECTNO>225.7011-3</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Unless a waiver has been granted, use the clause at 252.225-7030, Restriction on Acquisition of Carbon, Alloy, and Armor Steel Plate, in solicitations and contracts that'</P>
                            <P>(a) Require the delivery to the Government of carbon, alloy, or armor steel plate that will be used in a Government-owned facility or a facility under the control of DoD; or</P>
                            <P>(b) Require contractors operating in a Government-owned facility or a facility under the control of DoD to purchase carbon, alloy, or armor steel plate.</P>
                            <CITA>[68 FR 15627, Mar. 31, 2003, as amended at 71 FR 75894, Dec. 19, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7012</SECTNO>
                            <SUBJECT>Restriction on supercomputers.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7012-1</SECTNO>
                            <SUBJECT>Restriction.</SUBJECT>
                            <P>In accordance with Section 8112 of Public Law 100-202, and similar sections in subsequent DoD appropriations acts, do not purchase a supercomputer unless it is manufactured in the United States.</P>
                            <CITA>[68 FR 15627, Mar. 31, 2003]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7012-2</SECTNO>
                            <SUBJECT>Waiver.</SUBJECT>
                            <P>The Secretary of Defense may waive this restriction, on a case-by-case basis, after certifying to the Armed Services and Appropriations Committees of Congress that—</P>
                            <P>(a) Adequate U.S. supplies are not available to meet requirements on a timely basis; and</P>
                            <P>(b) The acquisition must be made in order to acquire capability for national security purposes.</P>
                            <CITA>[68 FR 15627, Mar. 31, 2003]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7012-3</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Unless a waiver has been granted, use the clause at 252.225-7011, Restriction on Acquisition of Supercomputers, in solicitations and contracts for the acquisition of supercomputers.</P>
                            <CITA>[68 FR 15627, Mar. 31, 2003]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7013</SECTNO>
                            <SUBJECT>Restrictions on construction or repair of vessels in foreign shipyards.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7013-0</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>This section implements 10 U.S.C. 8679 and 10 U.S.C. 8680.</P>
                            <CITA>[88 FR 73241, Oct. 25, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7013-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this section—</P>
                            <P>
                                <E T="03">Corrective and preventive maintenance or repair</E>
                                 means—
                            </P>
                            <P>(1) Maintenance or repair actions performed as a result of a failure in order to return or restore equipment to acceptable performance levels; and</P>
                            <P>(2) Scheduled maintenance or repair actions to prevent or discover functional failures.</P>
                            <P>
                                <E T="03">Facilities maintenance</E>
                                 means the effort required to—
                            </P>
                            <P>(1) Provide housekeeping services throughout the ship;</P>
                            <P>(2) Perform coating maintenance and repair to exterior and interior surfaces due to normal environmental conditions; and</P>
                            <P>(3) Clean mechanical spaces, mission zones, and topside spaces.</P>
                            <CITA>[88 FR 73241, Oct. 25, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7013-2</SECTNO>
                            <SUBJECT>Restrictions.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Contract award (10 U.S.C. 8679).</E>
                                 Do not award a contract to construct in a foreign shipyard—
                            </P>
                            <P>(1) A vessel for any of the armed forces; or</P>
                            <P>(2) A major component of the hull or superstructure of a vessel for any of the armed forces.</P>
                            <P>
                                (b) 
                                <E T="03">Overhaul, repair, or maintenance (10 U.S.C. 8680).</E>
                                 (1) Do not overhaul, repair, or maintain, in a shipyard outside the United States or Guam, a naval vessel (or any other vessel under the jurisdiction of the Secretary of the Navy) homeported in the United States or Guam.
                            </P>
                            <P>(2) This restriction on overhaul, repair, or maintenance does not apply to—</P>
                            <P>(i) Voyage repairs; or</P>
                            <P>
                                (ii) Repairs necessary to correct damage sustained due to hostile actions or interventions.
                                <PRTPAGE P="229"/>
                            </P>
                            <P>(3) For a naval vessel classified as a littoral combat ship and operating on deployment—</P>
                            <P>(i) Corrective and preventive maintenance or repair, whether intermediate or depot level, and facilities maintenance may be performed if the work is performed by U.S. Government personnel or U.S. contractor personnel—</P>
                            <P>(A) In a foreign shipyard;</P>
                            <P>(B) At a facility outside of a foreign shipyard; or</P>
                            <P>(C) At any other facility convenient to the vessel;</P>
                            <P>(ii) Foreign workers may be used to perform corrective and preventive maintenance or repair, only if the Secretary of the Navy, without power of delegation, determines that travel by U.S. Government or contractor personnel to perform the maintenance or repair is not advisable for health or safety reasons; and</P>
                            <P>(iii) Foreign contractors may perform facilities maintenance only as approved by the Secretary of Navy.</P>
                            <CITA>[88 FR 73241, Oct. 25, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7014</SECTNO>
                            <SUBJECT>Restrictions on military construction.</SUBJECT>
                            <P>
                                (a) For restriction on award of military construction contracts to be performed in the United States outlying areas in the Pacific and on Kwajalein Atoll, or in countries bordering the Arabian Gulf, 
                                <E T="03">see</E>
                                 236.273(a).
                            </P>
                            <P>
                                (b) For restriction on acquisition of steel for use in military construction projects, 
                                <E T="03">see</E>
                                 236.274.
                            </P>
                            <CITA>[74 FR 2417, Jan. 15, 2009, as amended at 79 FR 44316, July 31, 2014; 80 FR 15911, Mar. 26, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7015</SECTNO>
                            <SUBJECT>Restriction on overseas architect-engineer services.</SUBJECT>
                            <P>For restriction on award of architect-engineer contracts to be performed in Japan, in any North Atlantic Treaty Organization member country, or in countries bordering the Arabian Gulf, see 236.602-70.</P>
                            <CITA>[68 FR 15627, Mar. 31, 2003, as amended at 79 FR 44316, July 31, 2014; 80 FR 15911, Mar. 26, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7017</SECTNO>
                            <SUBJECT>Utilization of domestic photovoltaic devices.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7017-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this section—</P>
                            <P>
                                <E T="03">Caribbean Basin country photovoltaic device</E>
                                 means a photovoltaic device that—
                            </P>
                            <P>(1) Is wholly manufactured in a Caribbean Basin country; or</P>
                            <P>(2) In the case of a photovoltaic device that consists in whole or in part of materials from another country, has been substantially transformed in a Caribbean Basin country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed, provided that the photovoltaic device is not subsequently substantially transformed outside of a Caribbean Basin country.</P>
                            <P>
                                <E T="03">Covered contract</E>
                                 means an energy savings performance contract, a utility services contract, or a private housing contract awarded by DoD, to be performed in the United States, if such contract results in DoD ownership of photovoltaic devices, by means other than DoD purchase as end products. DoD is deemed to own a photovoltaic device if the device is—
                            </P>
                            <P>(1) Installed in the United States on DoD property or in a facility owned by DoD; and</P>
                            <P>(2) Reserved for the exclusive use of DoD in the United States for the full economic life of the device.</P>
                            <P>
                                <E T="03">Designated country photovoltaic device</E>
                                 means a World Trade Organization Government Procurement Agreement (WTO GPA) country photovoltaic device, a Free Trade Agreement country photovoltaic device, a least developed country photovoltaic device, or a Caribbean Basin country photovoltaic device.
                            </P>
                            <P>
                                <E T="03">Domestic photovoltaic device</E>
                                 means a photovoltaic device that is manufactured in the United States.
                            </P>
                            <P>
                                <E T="03">Foreign photovoltaic device</E>
                                 means a photovoltaic device other than a domestic photovoltaic device.
                            </P>
                            <P>
                                <E T="03">Free Trade Agreement country photovoltaic device</E>
                                 means a photovoltaic device that—
                            </P>
                            <P>
                                (1) Is wholly manufactured in a Free Trade Agreement country; or
                                <PRTPAGE P="230"/>
                            </P>
                            <P>(2) In the case of a photovoltaic device that consists in whole or in part of materials from another country, has been substantially transformed in a Free Trade Agreement country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed, provided that the photovoltaic device is not subsequently substantially transformed outside of a Free Trade Agreement country.</P>
                            <P>
                                <E T="03">Least developed country photovoltaic device</E>
                                 means a photovoltaic device that—
                            </P>
                            <P>(1) Is wholly manufactured in a least developed country; or</P>
                            <P>(2) In the case of a photovoltaic device that consists in whole or in part of materials from another country, has been substantially transformed in a least developed country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed, provided that the photovoltaic device is not subsequently substantially transformed outside of a least developed country.</P>
                            <P>
                                <E T="03">Photovoltaic device</E>
                                 means a device that converts light directly into electricity through a solid-state, semiconductor process.
                            </P>
                            <P>
                                <E T="03">Qualifying country photovoltaic device</E>
                                 means a photovoltaic device manufactured in a qualifying country.
                            </P>
                            <P>
                                <E T="03">U.S.-made photovoltaic device</E>
                                 means a photovoltaic device that—
                            </P>
                            <P>(1) Is manufactured in the United States; or</P>
                            <P>(2) Is substantially transformed in the United States into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed, provided that the photovoltaic device is not subsequently substantially transformed outside of the United States.</P>
                            <P>
                                <E T="03">WTO GPA country photovoltaic device</E>
                                 means a photovoltaic device that—
                            </P>
                            <P>(1) Is wholly manufactured in a WTO GPA country; or</P>
                            <P>(2) In the case of a photovoltaic device that consists in whole or in part of materials from another country, has been substantially transformed in a WTO GPA country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed, provided that the photovoltaic device is not subsequently substantially transformed outside of a WTO GPA country.</P>
                            <CITA>[80 FR 72603, Nov. 20, 2015, as amended at 83 FR 62499, Dec. 4, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7017-2</SECTNO>
                            <SUBJECT>Restriction.</SUBJECT>
                            <P>
                                In accordance with section 846 of the National Defense Authorization Act for Fiscal Year 2011 (Pub. L. 111-383), photovoltaic devices provided under any covered contract shall comply with 41 U.S.C. chapter 83, Buy American, subject to the exceptions to that statute provided in the Trade Agreements Act of 1979 (19 U.S.C. 2501 
                                <E T="03">et seq.</E>
                                ).
                            </P>
                            <CITA>[83 FR 62500, Dec. 4, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7017-3</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <P>DoD requires the contractor to utilize domestic photovoltaic devices in covered contracts that exceed the simplified acquisition threshold, with the following exceptions:</P>
                            <P>
                                (a) 
                                <E T="03">Qualifying country.</E>
                                 Qualifying country photovoltaic devices may be utilized in any covered contract, because 225.103(a)(i)(A) provides an exception to the Buy American statute for products of qualifying countries, as defined in 225.003.
                            </P>
                            <P>
                                (b) 
                                <E T="03">Buy American—unreasonable cost.</E>
                                 For a covered contract that utilizes photovoltaic devices valued at less than $174,000, the exception for unreasonable cost may apply (see FAR 25.103(c)). If the cost of a foreign photovoltaic device plus 50 percent is less than the cost of a domestic photovoltaic device, then the foreign photovoltaic device may be utilized.
                            </P>
                            <P>
                                (c) 
                                <E T="03">Trade agreements</E>
                                —(1) 
                                <E T="03">Free Trade Agreements.</E>
                                 For a covered contract that utilizes photovoltaic devices , photovoltaic devices may be utilized from a country covered under the acquisition by a Free Trade Agreement, depending upon dollar threshold (see FAR subpart 25.4).
                            </P>
                            <P>
                                (2) 
                                <E T="03">World Trade Organization—Government Procurement Agreement.</E>
                                 For covered contracts that utilize photovoltaic devices that are valued at $174,000 or 
                                <PRTPAGE P="231"/>
                                more, only U.S.-made photovoltaic devices, designated country photovoltaic devices, or qualifying country photovoltaic devices may be utilized.
                            </P>
                            <CITA>[83 FR 62500, Dec. 4, 2018, as amended at 84 FR 72247, Dec. 31, 2019; 86 FR 74377, Dec. 30, 2021; 89 FR 20873, Mar. 26, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7017-4</SECTNO>
                            <SUBJECT>Solicitation provision and contract clause.</SUBJECT>
                            <P>
                                (a)(1) Use the clause at 252.225-7017, Photovoltaic Devices, in solicitations, including solicitations using FAR part 12 procedures for the acquisition of commercial products and commercial services, for a contract expected to exceed the simplified acquisition threshold that may be a covered contract, 
                                <E T="03">i.e.,</E>
                                 an energy savings performance contract, a utility service contract, or a private housing contract awarded by DoD, if such contract will result in DoD ownership of photovoltaic devices, by means other than DoD purchase as end products.
                            </P>
                            <P>(2) Use the clause in the resultant contract, including contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, if it is a covered contract.</P>
                            <P>(b) Use the provision at 252.225-7018, Photovoltaic Devices—Certificate, in solicitations, including solicitations using FAR part 12 procedures for the acquisition of commercial products and commercial services, that contain the clause at 252.225-7017.</P>
                            <CITA>[76 FR 78860, Dec. 20, 2011, as amended at 78 FR 37988, June 25, 2013. Redesignated and amended at 80 FR 72603, Nov. 20, 2015; Redesignated and amended at 83 FR 62500, Dec. 4, 2018; 88 FR 6584, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7018</SECTNO>
                            <SUBJECT>Restriction on acquisition of certain magnets, tantalum, and tungsten.</SUBJECT>
                            <CITA>[84 FR 18158, Apr. 30, 2019, as amended at 85 FR 61502, Sept. 29, 2020]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7018-0</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>This section implements 10 U.S.C. 4872.</P>
                            <CITA>[89 FR 46820, May 30, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7018-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this section—</P>
                            <P/>
                            <P>
                                <E T="03">Covered material</E>
                                 means—
                            </P>
                            <P>(1) Samarium-cobalt magnets;</P>
                            <P>(2) Neodymium-iron-boron magnets;</P>
                            <P>(3) Tantalum metals and alloys;</P>
                            <P>(4) Tungsten metal powder; and</P>
                            <P>(5) Tungsten heavy alloy or any finished or semi-finished component containing tungsten heavy alloy.</P>
                            <P>
                                <E T="03">Electronic device</E>
                                 means an item that operates by controlling the flow of electrons or other electrically charged particles in circuits, using interconnections such as resistors, inductors, capacitors, diodes, switches, transistors, or integrated circuits.
                            </P>
                            <P>
                                <E T="03">Tungsten heavy alloy</E>
                                 means a tungsten base pseudo alloy that—
                            </P>
                            <P>(1) Meets the specifications of ASTM B777 or SAE-AMS-T-21014 for a particular class of tungsten heavy alloy; or</P>
                            <P>(2) Contains at least 90 percent tungsten in a matrix of other metals (such as nickel-iron or nickel-copper) and has density of at least 16.5 g/cm3).</P>
                            <CITA>[84 FR 18158, Apr. 30, 2019, as amended at 84 FR 72244, Dec. 31, 2019; 85 FR 61502, Sept. 29, 2020; 87 FR 52347, Aug. 25, 2022; 88 FR 6603, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7018-2</SECTNO>
                            <SUBJECT>Restriction.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">General.</E>
                                 Except as provided in 225.7018-3 and 225.7018-4—
                            </P>
                            <P>(1) Effective through December 31, 2026, do not acquire any covered material melted or produced in any covered country, or any end item, manufactured in any covered country, that contains a covered material; and</P>
                            <P>(2) Effective January 1, 2027, do not acquire any covered material mined, refined, separated, melted, or produced in any covered country, or any end item, manufactured in any covered country, that contains a covered material. (Section 854, Pub. L. 118-31; 10 U.S.C. 4872.)</P>
                            <P>
                                (b) 
                                <E T="03">Samarium-cobalt magnets and neodymium-iron-boron magnets.</E>
                                 (1) Effective through December 31, 2026, for samarium-cobalt magnets and neodymium-iron-boron magnets, this restriction includes—
                            </P>
                            <P>
                                (i) Melting samarium with cobalt to produce the samarium-cobalt alloy or melting neodymium with iron and boron to produce the neodymium-iron-boron alloy; and
                                <PRTPAGE P="232"/>
                            </P>
                            <P>(ii) All subsequent phases of production of the magnets, such as powder formation, pressing, sintering or bonding, and magnetization.</P>
                            <P>(2) Effective January 1, 2027, for samarium-cobalt magnets this restriction includes the entire supply chain from mining or production of a cobalt and samarium ore or feedstock, including recycled material, through production of finished magnets, except as provided at 225.7018-3.</P>
                            <P>(3) The restriction on melting and producing of samarium-cobalt magnets is in addition to any applicable restrictions on melting of specialty metals at 225.7003 and the clause at 252.225-7009, Restriction on Acquisition of Certain Articles Containing Specialty Metals.</P>
                            <P>(4) Effective January 1, 2027, for neodymium-iron-boron magnets, this restriction includes the entire supply chain from mining of neodymium, iron, and boron through production of finished magnets, except as provided at 225.7018-3.</P>
                            <P>
                                (c) 
                                <E T="03">Tantalum metals and alloys.</E>
                                 (1) Effective through December 31, 2026, for production of tantalum metals of any kind and alloys, this restriction includes the reduction or melting of any form of tantalum to create tantalum metal including unwrought, powder, mill products, and alloys. The restriction also covers all subsequent phases of production of tantalum metals and alloys.
                            </P>
                            <P>(2) Effective January 1, 2027, for production of tantalum metals of any kind and alloys, this restriction includes mining or production of a tantalum ore or feedstock, including recycled material, through production of metals of any kind and alloys, except as provided at 225.7018-3.</P>
                            <P>
                                (d) 
                                <E T="03">Tungsten metal powder and tungsten heavy alloy.</E>
                                 (1) Effective through December 31, 2026, for production of tungsten metal powder and tungsten heavy alloy, this restriction includes—
                            </P>
                            <P>(i) Atomization;</P>
                            <P>(ii) Calcination and reduction into powder;</P>
                            <P>(iii) Final consolidation of non-melt derived metal powders; and</P>
                            <P>(iv) All subsequent phases of production of tungsten metal powder, tungsten heavy alloy, or any finished or semi-finished component containing tungsten heavy alloy.</P>
                            <P>(2) Effective January 1, 2027, for production of tungsten metal powder, tungsten heavy alloy, or any finished or semi-finished component containing tungsten heavy alloy, this restriction includes mining or production of a tungsten ore or feedstock, including recycled material, through production of tungsten metal powders, except as provided at 225.7018-3.</P>
                            <CITA>[89 FR 46820, May 30, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7018-3</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <P>The restriction in section 225.7018-2 does not apply to an acquisition—</P>
                            <P>(a) At or below the simplified acquisition threshold;</P>
                            <P>(b) Outside the United States of an item for use outside the United States; or</P>
                            <P>(c) Of an end item containing a covered material that is—</P>
                            <P>(1) A commercially available off-the-shelf item (but see PGI 225.7018-3(c)(1) with regard to commercially available samarium-cobalt magnets), other than—</P>
                            <P>(i) A commercially available off-the-shelf item that is—</P>
                            <P>(A) 50 percent or more tungsten by weight effective through December 31, 2026; or</P>
                            <P>(B) 50 percent or more covered material by weight effective January 1, 2027;</P>
                            <P>(ii) Effective through December 31, 2026, a tantalum metal, tantalum alloy, or tungsten heavy alloy mill product, such as bar, billet, slab, wire, cube, sphere, block, blank, plate, or sheet, that has not been incorporated into an end item, subsystem, assembly, or component; or</P>
                            <P>(iii) Effective January 1, 2027, a covered material that is a mill product such as bar, billet, slab, wire, cube, sphere, block, blank, plate, or sheet, that has not been incorporated into an end item, subsystem, assembly, or component;</P>
                            <P>
                                (2) An electronic device, unless the Secretary of Defense, upon the recommendation of the Strategic and Critical Materials Board of Directors pursuant to 50 U.S.C. 98h-1 determines that the domestic availability of a particular electronic device is critical to national security (but see PGI 225.7018-
                                <PRTPAGE P="233"/>
                                3(c)(2) with regard to samarium-cobalt magnets used in electronic components); or
                            </P>
                            <P>(3) A neodymium-iron-boron magnet manufactured from recycled material if the milling of the recycled material and sintering of the final magnet takes place in the United States.</P>
                            <P>(d) If the authorized agency official concerned, as specified in 225.7018-4, determines that compliant covered materials of satisfactory quality and quantity, in the required form, cannot be procured as and when needed at a reasonable price.</P>
                            <P>(1) For tantalum metal, tantalum alloy, or tungsten heavy alloy, the term “required form” refers to the form of the mill product, such as bar, billet, wire, slab, plate, or sheet, in the grade appropriate for the production of a finished end item to be delivered to the Government under the contract; or a finished component assembled into an end item to be delivered to the Government under the contract.</P>
                            <P>(2) For samarium-cobalt magnets or neodymium-iron-boron magnets, the term “required form” refers to the form and properties of the magnets.</P>
                            <CITA>[84 FR 18158, Apr. 30, 2019, as amended at 84 FR 72244, Dec. 31, 2019; 85 FR 61502, Sept. 29, 2020; 87 FR 52347, Aug. 25, 2022; 89 FR 46820, May 30, 2024; 89 FR 66286, Aug. 15, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7018-4</SECTNO>
                            <SUBJECT>Nonavailability determination.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Individual nonavailability determinations.</E>
                                (1) The head of the contracting activity is authorized to make a nonavailability determination described in 225.7018-3(d) on an individual basis (
                                <E T="03">i.e.,</E>
                                 applies to only one contract).
                            </P>
                            <P>(2) The supporting documentation for the determination shall include an analysis and written certification by the requiring activity that describes, with specificity, why alternatives that would not require a nonavailability determination are unacceptable. The template for an individual nonavailability determination is available at PGI 225.7018-4(a)(2).</P>
                            <P>(3) Provide to USD(A&amp;S) DASD (Industrial Policy), in accordance with the procedures at PGI 225.7018-4(a)(3)—</P>
                            <P>(i) A copy of individual nonavailability determinations with supporting documentation; and</P>
                            <P>(ii) Notification when individual nonavailability determinations are requested, but denied.</P>
                            <P>
                                (b) 
                                <E T="03">Class nonavailability determinations.</E>
                                 A class nonavailability determination (
                                <E T="03">i.e.,</E>
                                 a nonavailability determinations that applies to more than one contract) requires the approval of the USD(A&amp;S). Follow the procedures at PGI 225.7018-4(b) when submitting a request for a class nonavailability determination.
                            </P>
                            <P>(1) At least 30 days before making a nonavailability determination that would apply to more than one contract, the USD(A&amp;S) will, to the maximum extent practicable, and in a manner consistent with the protection of national security and confidential business information—</P>
                            <P>
                                (i) Publish a notice in the GPE (
                                <E T="03">https://www.sam.gov</E>
                                ) of the intent to make the nonavailability determination; and
                            </P>
                            <P>(ii) Solicit information relevant to such notice from interested parties, including producers of mill products from covered materials.</P>
                            <P>(2) The USD(A&amp;S)—</P>
                            <P>(i) Will take into consideration all information submitted in response to the notice in making a class nonavailability determination;</P>
                            <P>(ii) May consider other relevant information that cannot be made part of the public record consistent with the protection of national security information and confidential business information; and</P>
                            <P>(iii) Will ensure that any such nonavailability determination and the rationale for the determination are made publicly available to the maximum extent consistent with the protection of national security and confidential business information.</P>
                            <CITA>[84 FR 18158, Apr. 30, 2019, as amended at 84 FR 72244, Dec. 31, 2019; 85 FR 61502, Sept. 29, 2020; 88 FR 88533, Dec. 22, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7018-5</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>
                                Unless acquiring items outside the United States for use outside the United States or a nonavailability determination has been made in accordance with 225.7018-4, use the clause at 
                                <PRTPAGE P="234"/>
                                252.225-7052, Restriction on Acquisition of Certain Magnets, Tantalum, and Tungsten , in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, that exceed the simplified acquisition threshold.
                            </P>
                            <CITA>[84 FR 18158, Apr. 30, 2019, as amended at 85 FR 61502, Sept. 29, 2020; 88 FR 6584, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7019</SECTNO>
                            <SUBJECT>Prohibition on use of certain energy sourced from inside the Russian Federation.</SUBJECT>
                        </SECTION>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>86 FR 48338, Aug. 30, 2021, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>225.7019-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this section—</P>
                            <P>
                                <E T="03">Covered military installation</E>
                                 means a military installation in Europe identified by DoD as a main operating base.
                            </P>
                            <P>
                                <E T="03">Furnished energy</E>
                                 means energy furnished to a covered military installation in any form and for any purpose, including heating, cooling, and electricity.
                            </P>
                            <P>
                                <E T="03">Main operating base</E>
                                 means a facility outside the United States and its territories with permanently stationed operating forces and robust infrastructure.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7019-2</SECTNO>
                            <SUBJECT>Prohibition.</SUBJECT>
                            <P>In accordance with section 2821 of the National Defense Authorization Act for Fiscal Year 2020 (Pub. L. 116-92), contracts for the acquisition of furnished energy for a covered military installation shall not use any energy sourced from inside the Russian Federation as a means of generating the furnished energy for the covered military installation. The prohibition—</P>
                            <P>(a) Applies to all forms of energy that are furnished to a covered military installation; and</P>
                            <P>(b) Does not apply to energy converted by a third party into another form of energy and not directly delivered to a covered military installation.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7019-3</SECTNO>
                            <SUBJECT>Waiver.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Request and approval of waiver.</E>
                                 The requiring activity may submit to the contracting activity a request for waiver of the prohibition in 225.7019-2 for a specific contract for the acquisition of furnished energy for a covered military installation. The head of the contracting activity, without power of redelegation, may approve the waiver, upon certification to the congressional defense committees that—
                            </P>
                            <P>(1) The waiver of section 2821 is necessary to ensure an adequate supply of furnished energy for the covered military installation; and</P>
                            <P>(2) National security requirements have been balanced against the potential risk associated with reliance upon the Russian Federation for furnished energy.</P>
                            <P>
                                (b) 
                                <E T="03">Submission of waiver notice.</E>
                                 (1) Not later than 14 days before the execution of any energy contract for which a waiver is granted under paragraph (a) of this section, the head of the contracting activity shall submit to the congressional defense committees a notice of the waiver. See PGI 225.7019-3 for waiver procedures.
                            </P>
                            <P>(2) The waiver notice shall include the following:</P>
                            <P>(i) The rationale for the waiver, including the basis for the certifications required by paragraph (a) of this section.</P>
                            <P>(ii) An assessment of how the waiver may impact DoD's European energy resilience strategy.</P>
                            <P>(iii) An explanation of the measures DoD is taking to mitigate the risk of using Russian Federation furnished energy.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7019-4</SECTNO>
                            <SUBJECT>Solicitation provision and contract clause.</SUBJECT>
                            <P>Unless a waiver has been granted in accordance with 225.7019-3—</P>
                            <P>(a) Use the provision at 252.225-7053, Representation Regarding Prohibition on Use of Certain Energy Sourced from Inside the Russian Federation, in solicitations, including solicitations using FAR part 12 procedures for the acquisition of commercial products and commercial services and solicitations at or below the simplified acquisition threshold, that are for the acquisition of furnished energy for a covered military installation; and</P>
                            <P>
                                (b) Use the clause at 252.225-7054, Prohibition on Use of Certain Energy Sourced from Inside the Russian Federation, in solicitations and contracts, 
                                <PRTPAGE P="235"/>
                                including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services and solicitations and contracts at or below the simplified acquisition threshold, that are for the acquisition of furnished energy for a covered military installation.
                            </P>
                            <CITA>[86 FR 48338, Aug. 30, 2021, as amended at 88 FR 6584, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7020</SECTNO>
                            <SUBJECT>Prohibition on contracting with the Maduro regime.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7020-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this section—</P>
                            <P>
                                <E T="03">Agency or instrumentality of the government of Venezuela</E>
                                 means an agency or instrumentality of a foreign state as defined in 28 U.S.C. 1603(b), with each reference in section 1603(b) to a foreign state deemed to be a reference to Venezuela.
                            </P>
                            <P>
                                <E T="03">Business operations</E>
                                 means engaging in commerce in any form, including acquiring, developing, maintaining, owning, selling, possessing, leasing, or operating equipment, facilities, personnel, products, services, personal property, real property, or any other apparatus of business or commerce.
                            </P>
                            <P>
                                <E T="03">Government of Venezuela</E>
                                 means the government of any political subdivision of Venezuela, and any agency or instrumentality of the government of Venezuela.
                            </P>
                            <P>
                                <E T="03">Person</E>
                                 means—
                            </P>
                            <P>(1) A natural person, corporation, company, business association, partnership, society, trust, or any other nongovernmental entity, organization, or group;</P>
                            <P>(2) Any governmental entity or instrumentality of a government, including a multilateral development institution (as defined in section 1701(c)(3) of the International Financial Institutions Act (22 U.S.C. 262r(c)(3)); and</P>
                            <P>(3) Any successor, subunit, parent entity, or subsidiary of, or any entity under common ownership or control with, any entity described in paragraph (1) or (2) of this definition.</P>
                            <CITA>[87 FR 31960, May 26, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7020-2</SECTNO>
                            <SUBJECT>Prohibition.</SUBJECT>
                            <P>In accordance with section 890 of the National Defense Authorization Act for Fiscal Year 2020 (Pub. L. 116-92), DoD is prohibited from entering into a contract for the procurement of products or services with any person that has business operations with an authority of the government of Venezuela that is not recognized as the legitimate government of Venezuela by the U.S. Government, except as provided in 225.7020-3 or 225.7020-4.</P>
                            <CITA>[87 FR 31960, May 26, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7020-3</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <P>The prohibition in 225.7020-2 does not apply if—</P>
                            <P>(a) The person has a valid license to operate in Venezuela issued by the Office of Foreign Assets Control of the Department of the Treasury; or</P>
                            <P>(b) The acquisition is related to the operation and maintenance of the U.S. Government's consular office and diplomatic posts in Venezuela.</P>
                            <CITA>[87 FR 31960, May 26, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7020-4</SECTNO>
                            <SUBJECT>Joint determination.</SUBJECT>
                            <P>(a) The prohibition in section 225.7020-2 does not apply to an acquisition jointly determined by the Secretary of Defense and Secretary of State, without power of redelegation, to be—</P>
                            <P>(1) Necessary for purposes of—</P>
                            <P>(i) Providing humanitarian assistance to the people of Venezuela;</P>
                            <P>(ii) Disaster relief and other urgent lifesaving measures; or</P>
                            <P>(iii) Carrying out noncombatant evacuations; or</P>
                            <P>(2) Vital to the national security interests of the United States.</P>
                            <P>(b) Follow the procedures at PGI 225.7020-4(b) when entering into a contract on the basis of a joint determination.</P>
                            <CITA>[87 FR 31960, May 26, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7020-5</SECTNO>
                            <SUBJECT>Solicitation provision and contract clause.</SUBJECT>
                            <P>
                                (a) Use the provision at 252.225-7055, Representation Regarding Business Operations with the Maduro Regime, in solicitations, including solicitations using FAR part 12 procedures for the acquisition of commercial products and commercial services, that include the clause at 252.225-7056, Prohibition Regarding Business Operations with the Maduro Regime.
                                <PRTPAGE P="236"/>
                            </P>
                            <P>(b) Unless the exception at 225.7020-3(b) applies or a joint determination has been made in accordance with 225.7020-4, use the clause at 252.225-7056, Prohibition Regarding Business Operations with the Maduro Regime, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services.</P>
                            <CITA>[87 FR 31960, May 26, 2022, as amended at 88 FR 6584, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7021</SECTNO>
                            <SUBJECT>Disclosure requirements for employment transparency regarding individuals who perform work in the People's Republic of China.</SUBJECT>
                            <P>See PGI 225.7021 for additional procedures regarding disclosures.</P>
                            <CITA>[87 FR 52342, Aug. 25, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7021-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this section—</P>
                            <P>
                                <E T="03">Covered contract</E>
                                 means any DoD contract or subcontract with a value in excess of $5 million, not including contracts for commercial products and commercial services.
                            </P>
                            <P>
                                <E T="03">Covered entity</E>
                                 means any corporation, company, limited liability company, limited partnership, business trust, business association, or other similar entity, including any subsidiary thereof, performing work on a covered contract in the People's Republic of China, including by leasing or owning real property used in the performance of the covered contract in the People's Republic of China.
                            </P>
                            <CITA>[87 FR 52342, Aug. 25, 2022, as amended at 88 FR 6584, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7021-2</SECTNO>
                            <SUBJECT>Restrictions.</SUBJECT>
                            <P>In accordance with section 855 of the National Defense Authorization Act for Fiscal Year 2022 (Pub. L. 117-81, 10 U.S.C. 4651 note prec.), do not award, extend, or exercise an option on a covered contract unless a covered entity has submitted each required disclosure.</P>
                            <CITA>[87 FR 52342, Aug. 25, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7021-3</SECTNO>
                            <SUBJECT>National security waiver of disclosure.</SUBJECT>
                            <P>The senior procurement executive (SPE) may waive the disclosure requirements at 225.7021-2 if the SPE determines in writing that such disclosure would not be in the national security interests of the United States. This authority may not be delegated. See PGI 225.7021-3 for procedures and content requirements regarding the SPE's written determination.</P>
                            <CITA>[87 FR 52342, Aug. 25, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7021-4</SECTNO>
                            <SUBJECT>Solicitation provision and contract clause.</SUBJECT>
                            <P>(a) Use the provision at 252.225-7057, Preaward Disclosure of Employment of Individuals Who Work in the People's Republic of China, in solicitations that include the clause at 252.225-7058.</P>
                            <P>(b) Unless a waiver has been granted, use the clause at 252.225-7058, Postaward Disclosure of Employment of Individuals Who Work in the People's Republic of China, in solicitations and contracts with an estimated value in excess of $5 million.</P>
                            <CITA>[87 FR 52342, Aug. 25, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7022</SECTNO>
                            <SUBJECT>Prohibition on certain procurements from the Xinjiang Uyghur Autonomous Region.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7022-1</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>This section implements section 855 of the National Defense Authorization Act for Fiscal Year 2023 (Pub. L. 117-263) and 10 U.S.C. 4661.</P>
                            <CITA>[88 FR 37797, June 9, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7022-2</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this section—</P>
                            <P>
                                <E T="03">Forced labor</E>
                                 means any work or service that is exacted from any person under the menace of any penalty for nonperformance and that the worker does not offer to perform (10 U.S.C. 2496).
                            </P>
                            <P>
                                <E T="03">XUAR</E>
                                 means the Xinjiang Uyghur Autonomous Region of the People's Republic of China (10 U.S.C. 2496).
                            </P>
                            <CITA>[88 FR 37797, June 9, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7022-3</SECTNO>
                            <SUBJECT>Prohibition.</SUBJECT>
                            <P>
                                Contracting officers shall not award a contract utilizing funds appropriated or otherwise made available for for any fiscal year for any products mined, produced, or manufactured wholly or in part by forced labor from XUAR or from an entity that has used labor from within or transferred from XUAR 
                                <PRTPAGE P="237"/>
                                as part of any forced labor programs, unless an exception applies.
                            </P>
                            <CITA>[87 FR 76983, Dec. 16, 2022, as amended at 88 FR 37797, June 9, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7022-4</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <P>The prohibition at 225.7022-3 does not apply to—</P>
                            <P>(a) Purchases under the micro-purchase threshold made using the Governmentwide commercial purchase card; or</P>
                            <P>(b) Purchases using the SF 44 in accordance with 213.306.</P>
                            <CITA>[87 FR 76983, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7022-5</SECTNO>
                            <SUBJECT>Solicitation provision and contract clause.</SUBJECT>
                            <P>(a) Use the provision at 252.225-7059, Prohibition on Certain Procurements from the Xinjiang Uyghur Autonomous Region—Representation, in solicitations, including solicitations using FAR part 12 procedures for the acquisition of commercial products, commercial services, and COTS items, that contain the clause at 252.225-7060, Prohibition on Certain Procurements from the Xinjiang Uyghur Autonomous Region.</P>
                            <P>(b) Use the clause at 252.225-7060, Prohibition on Certain Procurements from the Xinjiang Uyghur Autonomous Region, in solicitations, contracts, and orders for products utilizing funds appropriated or otherwise made available for any fiscal year, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products, commercial services, and COTS items.</P>
                            <CITA>[87 FR 76983, Dec. 16, 2022, as amended at 88 FR 6584, Jan. 31, 2023; 88 FR 37797, June 9, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7023</SECTNO>
                            <SUBJECT>Restriction on acquisition of personal protective equipment and certain other items from non-allied foreign nations.</SUBJECT>
                        </SECTION>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>88 FR 6603, Jan. 31, 2023, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>225.7023-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this section—</P>
                            <P>
                                <E T="03">Covered item</E>
                                 means an article or item of—
                            </P>
                            <P>(1) Personal protective equipment for use in preventing spread of disease, such as by exposure to infected individuals or contamination or infection by infectious material, including—</P>
                            <P>(i) Nitrile and vinyl gloves;</P>
                            <P>(ii) Surgical masks;</P>
                            <P>(iii) Respirator masks and powered air purifying respirators and required filters;</P>
                            <P>(iv) Face shields and protective eyewear;</P>
                            <P>(v) Surgical and isolation gowns and head and foot coverings; or</P>
                            <P>(vi) Clothing; and</P>
                            <P>(vii) The materials and components thereof, other than sensors, electronics, or other items added to and not normally associated with such personal protective equipment or clothing; or</P>
                            <P>(2) Sanitizing and disinfecting wipes, testing swabs, gauze, and bandages.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7023-2</SECTNO>
                            <SUBJECT>Restriction.</SUBJECT>
                            <P>Except as provided in 225.7023-3, do not acquire a covered item from a covered country in accordance with 10 U.S.C. 4875.</P>
                            <CITA>[88 FR 46905, July 20, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7023-3</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <P>The restriction in section 225.7023-2 does not apply to acquisitions—</P>
                            <P>(a) Of covered items for use outside of the United States;</P>
                            <P>(b) At or below $150,000; or</P>
                            <P>(c)(1) If the head of the contracting activity determines that a covered item of satisfactory quality and quantity, in the required form, cannot be procured as and when needed from nations other than a covered country to meet requirements at a reasonable price.</P>
                            <P>(2) The contracting officer shall include a copy of any such determination in the contract file.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7023-4</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>
                                Unless an exception applies, use the clause at 252.225-7061, Restriction on the Acquisition of Personal Protective Equipment and Certain Other Items from Non-Allied Foreign Nations, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products, including COTS items, and commercial services, and that—
                                <PRTPAGE P="238"/>
                            </P>
                            <P>(a) Are for the acquisition of covered items;</P>
                            <P>(b) Are for use within the United States; and</P>
                            <P>(c) Have an estimated value greater than $150,000.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7024</SECTNO>
                            <SUBJECT>Restriction on acquisition of fuel for overseas contingency operations.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7024-1</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>This section implements section 843 of the National Defense Authorization Act for Fiscal Year 2022 (Pub. L. 117-81), for the acquisition of fuel for overseas contingency operations.</P>
                            <CITA>[89 FR 78999, Sept. 26, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7024-2</SECTNO>
                            <SUBJECT>Prohibition.</SUBJECT>
                            <P>
                                Contracting officers shall not award, for an overseas contingency operation, a contract for fuel, in whole or in part, or derivatives of such fuel, that is sourced from nations or regions prohibited from selling petroleum to the United States. See FAR subpart 25.7 and the Office of Foreign Assets Control website at 
                                <E T="03">https://ofac.treasury.gov/sanctions-programs-and-country-information</E>
                                 for prohibited sources.
                            </P>
                            <CITA>[89 FR 78999, Sept. 26, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7024-3</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>(a) For contracts for the acquisition of fuel for overseas contingency operations, including contracts using FAR part 12 procedures, expected to exceed the simplified acquisition threshold, the contracting officer—</P>
                            <P>(1) May request records from the prospective contractor to verify compliance with the following statutes and regulations only when the head of the contracting activity determines in writing that it is necessary:</P>
                            <P>
                                (i) The Foreign Corrupt Practices Act (15 U.S.C. 78dd-1 
                                <E T="03">et seq.</E>
                                ).
                            </P>
                            <P>(ii) International Traffic in Arms Regulations at 22 CFR parts 120 through 130 (see PGI 225.7901-2).</P>
                            <P>(iii) Export Administration Regulations at 15 CFR parts 730 through 774 (see PGI 225.7901-2).</P>
                            <P>
                                (iv) Relevant regulations promulgated by the Office of Foreign Assets Control of the Department of the Treasury. Sanction information for specific countries and programs is available at 
                                <E T="03">https://ofac.treasury.gov/sanctions-programs-and-country-information.</E>
                            </P>
                            <P>(2) To the maximum extent practicable, shall not disqualify an otherwise responsible offeror on the basis of an unsupported denial of access to a facility or equipment by a host-nation government. The provision at 252.225-7065, Restriction on Acquisition of Fuel for Overseas Contingency Operations, requires offerors to report promptly to the contracting officer, prior to award, any instance of unsupported denial of access to a facility or equipment by a host-nation government that may prevent it from complying with the terms and conditions of the solicitation.</P>
                            <P>(b) See 215.101-71 for the requirement to consider using a tradeoff process.</P>
                            <CITA>[89 FR 78999, Sept. 26, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7024-4</SECTNO>
                            <SUBJECT>Solicitation provision.</SUBJECT>
                            <P>Use the provision at 252.225-7065, Restriction on Acquisition of Fuel for Overseas Contingency Operations, in solicitations, including solicitations using FAR part 12 procedures for the acquisition of commercial products and commercial services, that are for the acquisition of fuel for overseas contingency operations and are expected to exceed the simplified acquisition threshold.</P>
                            <CITA>[89 FR 78999, Sept. 26, 2024]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 225.71—Other Restrictions on Foreign Acquisition</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>68 FR 15631, Mar. 31, 2003, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>225.7100</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>This subpart contains foreign product restrictions that are based on policies designed to protect the defense industrial base.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7101</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>“Component” and “domestic manufacture,” as used in this subpart, are defined in the clause at 252.225-7025, Restriction on Acquisition of Forgings.</P>
                            <CITA>[74 FR 68384, Dec. 24, 2009]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="239"/>
                            <SECTNO>225.7102</SECTNO>
                            <SUBJECT>Forgings.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7102-1</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>When acquiring the following forging items, whether as end items or components, acquire items that are of domestic manufacture to the maximum extent practicable:</P>
                            <GPOTABLE COLS="2" OPTS="L2" CDEF="s50,r50">
                                <BOXHD>
                                    <CHED H="1">Items</CHED>
                                    <CHED H="1">Categories</CHED>
                                </BOXHD>
                                <ROW>
                                    <ENT I="01">Ship propulsion shafts</ENT>
                                    <ENT>Excludes service and landing craft shafts.</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">Periscope tubes</ENT>
                                    <ENT>All.</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">Ring forgings for bull gears</ENT>
                                    <ENT>All greater than 120 inches in diameter.</ENT>
                                </ROW>
                            </GPOTABLE>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7102-2</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <P>The policy in 225.7102-1 does not apply to acquisitions—</P>
                            <P>(a) Using simplified acquisition procedures, unless the restricted item is the end item being purchased;</P>
                            <P>(b) Overseas for overseas use; or</P>
                            <P>(c) When the quantity acquired exceeds the amount needed to maintain the U.S. defense mobilization base (provided the excess quantity is an economical purchase quantity). The requirement for domestic manufacture does not apply to the quantity above that required to maintain the base, in which case, qualifying country sources may compete.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7102-3</SECTNO>
                            <SUBJECT>Waiver.</SUBJECT>
                            <P>Upon request from a contractor, the contracting officer may waive the requirement for domestic manufacture of the items listed in 225.7102-1.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7102-4</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at 252.225-7025, Restriction on Acquisition of Forgings, in solicitations and contracts, unless—</P>
                            <P>(a) The supplies being acquired do not contain any of the items listed in 225.7102-1; or</P>
                            <P>(b) An exception in 225.7102-2 applies. If an exception applies to only a portion of the acquisition, specify the excepted portion in the solicitation and contract.</P>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 225.72—Reporting Contract Performance Outside the United States</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>70 FR 20839, Apr. 22, 2005, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>225.7201</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>10 U.S.C. 4603 requires offerors and contractors to notify DoD of any intention to perform any part of a DoD contract outside the United States and Canada that—</P>
                            <P>(a) Exceeds $750,000 in value; and</P>
                            <P>(b) Could be performed inside the United States or Canada.</P>
                            <CITA>[85 FR 61504, Sept. 29, 2020, as amended at 87 FR 76994, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7202</SECTNO>
                            <SUBJECT>Exception.</SUBJECT>
                            <P>This subpart does not apply to contracts for commercial products,  commercial services, construction, ores, natural gas, utilities, petroleum products and crudes, timber (logs), or subsistence.</P>
                            <CITA>[70 FR 20839, Apr. 22, 2005, as amended at 88 FR 6584, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7203</SECTNO>
                            <SUBJECT>Contracting officer distribution of reports.</SUBJECT>
                            <P>Follow the procedures at PGI 225.7203 for distribution of reports submitted with offers in accordance with the provision at 252.225-7003, Report of Intended Performance Outside the United States and Canada—Submission with Offer.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7204</SECTNO>
                            <SUBJECT>Solicitation provision and contract clauses.</SUBJECT>
                            <P>Except for acquisitions described in 225.7202—</P>
                            <P>(a) Use the provision at 252.225-7003, Report of Intended Performance Outside the United States and Canada—Submission with Offer, in solicitations with a value exceeding $15 million; and</P>
                            <P>(b) Use the clause at 252.225-7004, Report of Intended Performance Outside the United States and Canada—Submission after Award, in solicitations and contracts with a value exceeding $15 million.</P>
                            <CITA>[70 FR 20839, Apr. 22, 2005, as amended at 71 FR 75892, Dec. 19, 2006; 75 FR 45074, Aug. 2, 2010; 79 FR 73500, Dec. 11, 2014; 80 FR 36904, June 26, 2015; 85 FR 61504, Sept. 29, 2020]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <PRTPAGE P="240"/>
                        <HD SOURCE="HED">Subpart 225.73—Acquisitions for Foreign Military Sales</HD>
                        <SECTION>
                            <SECTNO>225.7300</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>(a) This subpart contains policies and procedures for acquisitions for foreign military sales (FMS) under the Arms Export Control Act (22 U.S.C. Chapter 39). Section 22 of the Arms Export Control Act (22 U.S.C. 2762) authorizes DoD to enter into contracts for resale to foreign countries or international organizations.</P>
                            <P>(b) This subpart does not apply to—</P>
                            <P>(1) FMS made from inventories or stocks;</P>
                            <P>(2) Acquisitions for replenishment of inventories or stocks; or</P>
                            <P>(3) Acquisitions made under DoD cooperative logistic supply support arrangements.</P>
                            <CITA>[63 FR 43889, Aug. 17, 1998]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7301</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>(a) The U.S. Government sells defense articles and services to foreign governments or international organizations through FMS agreements. The agreement is documented in a Letter of Offer and Acceptance (LOA) (see the Defense Security Cooperation Agency (DSCA) Security Assistance Management Manual (DSCA 5105.38-M)).</P>
                            <P>(b) Conduct FMS acquisitions under the same acquisition and contract management procedures used for other defense acquisitions.</P>
                            <P>(c) Follow the additional procedures at PGI 225.7301(c) for preparation of solicitations and contracts that include FMS requirements.</P>
                            <P>(d) See 229.170 for policy on contracts financed under U.S. assistance programs that involve payment of foreign country value added taxes or customs duties.</P>
                            <CITA>[70 FR 73155, Dec. 9, 2005, as amended at 80 FR 31310, June 2, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7301-1</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7301-2</SECTNO>
                            <SUBJECT>Solicitation approval for sole source contracts.</SUBJECT>
                            <P>The contracting officer shall coordinate through agency channels with the Principal Director, Defense Pricing, Contracting, and Acquisition Policy, prior to issuing a solicitation for a sole source contract for U.S./FMS combined requirements for a major system that has an estimated contract value that exceeds $500 million. See also 201.170 and PGI 216.403-1(1)(ii)(B) and (C).</P>
                            <CITA>[84 FR 65307, Nov. 27, 2019, as amended at 89 FR 60831, July 29, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7302</SECTNO>
                            <SUBJECT>Preparation of letter of offer and acceptance.</SUBJECT>
                            <P>For FMS programs that will require an acquisition, the contracting officer shall assist the DoD implementing agency responsible for preparing the Letter of Offer and Acceptance (LOA) by—</P>
                            <P>(1) Working with prospective contractors to—</P>
                            <P>(i) Identify, in advance of the LOA, any unusual provisions or deviations (such as those requirements for Pseudo LOAs identified at PGI 225.7301);</P>
                            <P>(ii) Advise the contractor if the DoD implementing agency expands, modifies, or does not accept any key elements of the prospective contractor's proposal;</P>
                            <P>(iii) Identify any logistics support necessary to perform the contract (such as those requirements identified at PGI 225.7301); and</P>
                            <P>(iv) For noncompetitive acquisitions over $10,000, ask the prospective contractor for information on price, delivery, and other relevant factors. The request for information shall identify the fact that the information is for a potential foreign military sale and shall identify the foreign customer; and</P>
                            <P>(2) Working with the DoD implementing agency responsible for preparing the LOA, as specified in PGI 225.7302.</P>
                            <CITA>[78 FR 73451, Dec. 6, 2013]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7303</SECTNO>
                            <SUBJECT>Pricing acquisitions for FMS.</SUBJECT>
                            <P>(a) Price FMS contracts using the same principles used in pricing other defense contracts. However, application of the pricing principles in FAR parts 15 and 31 to an FMS contract may result in prices that differ from other defense contract prices for the same item due to the considerations in this section.</P>
                            <P>
                                (b) If the foreign government has conducted a competition resulting in adequate price competition (see FAR 
                                <PRTPAGE P="241"/>
                                15.403-1(b)(1)), the contracting officer shall not require the submission of certified cost or pricing data. The contracting officer should consult with the foreign government through security assistance personnel to determine if adequate price competition has occurred.
                            </P>
                            <CITA>[64 FR 49683, Sept. 14, 1999, as amended at 68 FR 15632, Mar. 31, 2003; 77 FR 76940, Dec. 31, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7303-1</SECTNO>
                            <SUBJECT>Contractor sales to other foreign customers.</SUBJECT>
                            <P>If the contractor has made sales of the item required for the foreign military sale to foreign customers under comparable conditions, including quantity and delivery, price the FMS contract in accordance with FAR part 15.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7303-2</SECTNO>
                            <SUBJECT>Cost of doing business with a foreign government or an international organization.</SUBJECT>
                            <P>(a) In pricing FMS contracts where non-U.S. Government prices as described in 225.7303-1 do not exist, except as provided in 225.7303-5, recognize the reasonable and allocable costs of doing business with a foreign government or international organization, even though such costs might not be recognized in the same amounts in pricing other defense contracts. Examples of such costs include, but are not limited to, the following:</P>
                            <P>(1) Selling expenses (not otherwise limited by FAR Part 31), such as—</P>
                            <P>(i) Maintaining international sales and service organizations;</P>
                            <P>(ii) Sales commissions and fees in accordance with FAR Subpart 3.4;</P>
                            <P>(iii) Sales promotions, demonstrations, and related travel for sales to foreign governments. Section 126.8 of the International Traffic in Arms Regulations (22 CFR 126.8) may require Government approval for these costs to be allowable, in which case the appropriate Government approval shall be obtained; and</P>
                            <P>(iv) Configuration studies and related technical services undertaken as a direct selling effort to a foreign country.</P>
                            <P>(2) Product support and post-delivery service expenses, such as—</P>
                            <P>(i) Operations or maintenance training, training or tactics films, manuals, or other related data; and</P>
                            <P>(ii) Technical field services provided in a foreign country related to accident investigations, weapon system problems, or operations/tactics enhancement, and related travel to foreign countries.</P>
                            <P>
                                (3) 
                                <E T="03">Offsets.</E>
                                 For additional information see 225.7306.
                            </P>
                            <P>
                                (i) An offset agreement is the contractual arrangement between the FMS customer and the U.S. defense contractor that identifies the offset obligation imposed by the FMS customer that has been accepted by the U.S. defense contractor as a condition of the FMS customer's purchase. These agreements are distinct and independent of the LOA and the FMS contract. Further information about offsets and LOAs may be found in the Defense Security Cooperation Agency (DSCA) Security Assistance Management Manual (DSCA 5105.38-M), chapter 6, paragraph 6.3.9. (
                                <E T="03">http://samm.dsca.mil/chapter/chapter-6</E>
                                ).
                            </P>
                            <P>(ii) A U.S. defense contractor may recover all costs incurred for offset agreements with a foreign government or international organization if the LOA is financed wholly with foreign government or international organization customer cash or repayable foreign military finance credits.</P>
                            <P>(iii) The U.S. Government assumes no obligation to satisfy or administer the offset agreement or to bear any of the associated costs.</P>
                            <P>(iv) Indirect offset costs are deemed reasonable for purposes of FAR parts 15 and 31 with no further analysis necessary on the part of the contracting officer, provided that the U.S. defense contractor submits to the contracting officer a signed offset agreement or other documentation showing that the FMS customer has made the provision of an indirect offset a condition of the FMS acquisition. FMS customers are placed on notice through the LOA that indirect offset costs are deemed reasonable without any further analysis by the contracting officer.</P>
                            <P>
                                (4) Costs that are the subject of advance agreement under the appropriate provisions of FAR part 31; or where the advance understanding places a limit 
                                <PRTPAGE P="242"/>
                                on the amounts of cost that will be recognized as allowable in defense contract pricing, and the agreement contemplated that it will apply only to DoD contracts for the U.S. Government's own requirement (as distinguished from contracts for FMS).
                            </P>
                            <P>(b) Costs not allowable under FAR part 31 are not allowable in pricing FMS contracts, except as noted in paragraphs (c) and (e) of this section.</P>
                            <P>(c) The limitations for all contractors described in 231.205-18(c)(iii) and (iv) do not apply to FMS contracts, except as provided in 225.7303-5. The allowability of independent research and development (IR&amp;D) costs and bid and proposal (B&amp;P) costs on contracts for FMS not wholly paid for from funds made available on a nonrepayable basis is limited to the contract's allocable share of the contractor's total IR&amp;D expenditures and total B&amp;P expenditures. In pricing contracts for such FMS—</P>
                            <P>(1) Use the best estimate of reasonable costs in forward pricing; and</P>
                            <P>(2) Use actual expenditures, to the extent that they are reasonable, in determining final cost.</P>
                            <P>(d) Under paragraph (e)(1)(A) of Section 21 of the Arms Export Control Act (22 U.S.C. 2761), the United States must charge for administrative services to recover the estimated cost of administration of sales made under the Army Export Control Act.</P>
                            <P>(e) The limitations in 231.205-1 on allowability of costs associated with leasing Government equipment do not apply to FMS contracts.</P>
                            <CITA>[56 FR 36367, July 31, 1991, as amended at 56 FR 67216, Dec. 30, 1991; 57 FR 42631, Sept. 15, 1992; 57 FR 53600, Nov. 12, 1992; 59 FR 50511, Oct. 4, 1994; 61 FR 7744, Feb. 29, 1996; 61 FR 18987, Apr. 30, 1996; 63 FR 43889, Aug. 17, 1998; 64 FR 8729, Feb. 23, 1999; 64 FR 49684, Sept. 14, 1999; 68 FR 15632, Mar. 31, 2003; 70 FR 73155, Dec. 9, 2005; 74 FR 68382, Dec. 24, 2009; 80 FR 31310, June 2, 2015; 83 FR 30828, June 29, 2018; 88 FR 6599, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7303-3</SECTNO>
                            <SUBJECT>Government-to-government agreements.</SUBJECT>
                            <P>If a government-to-government agreement between the United States and a foreign government for the sale, coproduction, or cooperative logistic support of a specifically defined weapon system, major end item, or support item, contains language in conflict with the provisions of this section, the language of the government-to-government agreement prevails.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7303-4</SECTNO>
                            <SUBJECT>Contingent fees.</SUBJECT>
                            <P>(a) Except as provided in paragraph (b) of this subsection, contingent fees are generally allowable under DoD contracts, provided—</P>
                            <P>(1) The fees are paid to a bona fide employee or a bona fide established commercial or selling agency maintained by the prospective contractor for the purpose of securing business (see FAR Part 31 and FAR Subpart 3.4); and</P>
                            <P>(2) The contracting officer determines that the fees are fair and reasonable.</P>
                            <P>(b)(1) Under DoD 5105.38-M, LOAs for requirements for the governments of Australia, Taiwan, Egypt, Greece, Israel, Japan, Jordan, Republic of Korea, Kuwait, Pakistan, Philippines, Saudi Arabia, Turkey, Thailand, or Venezuela (Air Force) shall provide that all U.S. Government contracts resulting from the LOAs prohibit the reimbursement of contingent fees as an allowable cost under the contract, unless the contractor identifies the payments and the foreign customer approves the payments in writing before contract award (see 225.7307(a)).</P>
                            <P>(2) For FMS to countries not listed in paragraph (b)(1) of this subsection, contingent fees exceeding $50,000 per FMS case are unallowable under DoD contracts, unless the contractor identifies the payment and the foreign customer approves the payment in writing before contract award.</P>
                            <CITA>[68 FR 15633, Mar. 31, 2003, as amended at 70 FR 73155, Dec. 9, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7303-5</SECTNO>
                            <SUBJECT>Acquisitions wholly paid for from nonrepayable funds.</SUBJECT>
                            <P>(a) In accordance with 22 U.S.C. 2762(d), price FMS wholly paid for from funds made available on a nonrepayable basis on the same costing basis with regard to profit, overhead, IR&amp;D/B&amp;P, and other costing elements as is applicable to acquisitions of like items purchased by DoD for its own use.</P>
                            <P>
                                (b) Direct costs associated with meeting a foreign customer's additional or unique requirements are allowable 
                                <PRTPAGE P="243"/>
                                under such contracts. Indirect burden rates applicable to such direct costs are permitted at the same rates applicable to acquisitions of like items purchased by DoD for its own use.
                            </P>
                            <P>(c) A U.S. defense contractor may not recover costs incurred for offset agreements with a foreign government or international organization if the LOA is financed with funds made available on a nonrepayable basis.</P>
                            <CITA>[61 FR 18988, Apr. 30, 1996; 61 FR 49531, Sept. 20, 1996, as amended at 63 FR 43890, Aug. 17, 1998; 64 FR 49684, Sept. 14, 1999; 68 FR 15633, Mar. 31, 2003]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7304</SECTNO>
                            <SUBJECT>FMS customer involvement.</SUBJECT>
                            <P>(a) FMS customers may request that a defense article or defense service be obtained from a particular contractor. In such cases, FAR 6.302-4 provides authority to contract without full and open competition. The FMS customer may also request that a subcontract be placed with a particular firm. The contracting officer shall honor such requests from the FMS customer only if the LOA or other written direction sufficiently fulfills the requirements of FAR Subpart 6.3.</P>
                            <P>(b) FMS customers should be encouraged to participate with U.S. Government acquisition personnel in discussions with industry to—</P>
                            <P>(1) Develop technical specifications;</P>
                            <P>(2) Establish delivery schedules;</P>
                            <P>(3) Identify any special warranty provisions or other requirements unique to the FMS customer; and</P>
                            <P>(4) Review prices of varying alternatives, quantities, and options needed to make price-performance tradeoffs.</P>
                            <P>(c) Do not disclose to the FMS customer any data, including certified cost or pricing data, that is contractor proprietary unless the contractor authorizes its release.</P>
                            <P>(d) Except as provided in paragraph (e)(3) of this section, the degree of FMS customer participation in contract negotiations is left to the discretion of the contracting officer after consultation with the contractor. The contracting officer shall provide an explanation to the FMS customer if its participation in negotiations will be limited. Factors that may limit FMS customer participation include situations where—</P>
                            <P>(1) The contract includes requirements for more than one FMS customer;</P>
                            <P>(2) The contract includes unique U.S. requirements; or</P>
                            <P>(3) Contractor proprietary data is a subject of negotiations.</P>
                            <P>(e) Do not allow representatives of the FMS customer to—</P>
                            <P>(1) Direct the exclusion of certain firms from the solicitation process (they may suggest the inclusion of certain firms);</P>
                            <P>(2) Interfere with a contractor's placement of subcontracts; or</P>
                            <P>(3) Observe or participate in negotiations between the U.S. Government and the contractor involving certified cost or pricing data, unless a deviation is granted in accordance with subpart 201.4.</P>
                            <P>(f) Do not accept directions from the FMS customer on source selection decisions or contract terms (except that, upon timely notice, the contracting officer may attempt to obtain any special contract provisions, warranties, or other unique requirements requested by the FMS customer).</P>
                            <P>(g) Do not honor any requests by the FMS customer to reject any bid or proposal.</P>
                            <P>(h) If an FMS customer requests additional data concerning FMS contract prices, the contracting officer shall, after consultation with the contractor, provide sufficient data to demonstrate the reasonableness of the price and reasonable responses to relevant questions concerning contract price. This data—</P>
                            <P>(1) May include tailored responses, top-level pricing summaries, historical prices, or an explanation of any significant differences between the actual contract price and the estimated contract price included in the initial LOA; and</P>
                            <P>(2) May be provided orally, in writing, or by any other method acceptable to the contracting officer.</P>
                            <CITA>[67 FR 70325, Nov. 22, 2002, as amended at 77 FR 76940, Dec. 31, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7305</SECTNO>
                            <SUBJECT>Limitation of liability.</SUBJECT>
                            <P>
                                Advise the contractor when the foreign customer will assume the risk for loss or damage under the appropriate limitation of liability clause(s) (see FAR Subpart 46.8). Consider the costs 
                                <PRTPAGE P="244"/>
                                of necessary insurance, if any, obtained by the contractor to cover the risk of loss or damage in establishing the FMS contract price.
                            </P>
                            <CITA>[56 FR 36367, July 31, 1991, as amended at 68 FR 15633, Mar. 31, 2003]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7306</SECTNO>
                            <SUBJECT>Offset arrangements.</SUBJECT>
                            <P>In accordance with the Presidential policy statement of April 16, 1990, DoD does not encourage, enter into, or commit U.S. firms to FMS offset arrangements. The decision whether to engage in offsets, and the responsibility for negotiating and implementing offset arrangements, resides with the companies involved. (Also see 225.7303-2(a)(3).)</P>
                            <CITA>[70 FR 73155, Dec. 9, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7307</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>(a) Use the clause at 252.225-7027, Restriction on Contingent Fees for Foreign Military Sales, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, that are for FMS. Insert in paragraph (b)(1) of the clause the name(s) of any foreign country customer(s) listed in 225.7303-4(b).</P>
                            <P>(b) Use the clause at 252.225-7028, Exclusionary Policies and Practices of Foreign Governments, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, that are for the purchase of supplies and services for international military education training and FMS.</P>
                            <CITA>[68 FR 15633, Mar. 31, 2003. Redesignated at 70 FR 73155, Dec. 9, 2005. Amended at 78 FR 37988, June 25, 2013, as amended at 88 FR 6584, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <RESERVED>Subpart 225.74 [Reserved]</RESERVED>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 225.75—Balance of Payments Program</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>67 FR 20694, Apr. 26, 2002, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>225.7500</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>This subpart provides policies and procedures implementing the Balance of Payments Program. It applies to contracts for the acquisition of—</P>
                            <P>(a) Supplies for use outside the United States; and</P>
                            <P>(b) Construction to be performed outside the United States.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7501</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>Acquire only domestic end products for use outside the United States, and use only domestic construction material for construction to be performed outside the United States, including end products and construction material for foreign military sales, unless—</P>
                            <P>(a) Before issuing the solicitation—</P>
                            <P>(1) The estimated cost of the acquisition or the value of a particular construction material is at or below the simplified acquisition threshold;</P>
                            <P>(2) The end product or particular construction material is—</P>
                            <P>(i) Listed in FAR 25.104;</P>
                            <P>(ii) A petroleum product;</P>
                            <P>(iii) A spare part for foreign-manufactured vehicles, equipment, machinery, or systems, provided the acquisition is restricted to the original manufacturer or its supplier;</P>
                            <P>(iv) An industrial gas;</P>
                            <P>(v) A brand drug specified by the Defense Medical Materiel Board; or</P>
                            <P>(vi) Information technology that is a commercial product, using fiscal year 2004 or subsequent funds (section 535 of Division F of the Consolidated Appropriations Act, 2004 (Pub. L. 108-199), and the same provision in subsequent appropriations acts);</P>
                            <P>(3) The acquisition is covered by the World Trade Organization Government Procurement Agreement;</P>
                            <P>(4) The acquisition of foreign end products or construction material is required by a treaty or executive agreement between governments;</P>
                            <P>(5) Use of a procedure specified in 225.7703-1(a) is authorized for an acquisition in support of operations in Afghanistan;</P>
                            <P>(6) The end product is acquired for commissary resale; or</P>
                            <P>(7) The contracting officer determines that a requirement can best be filled by a foreign end product or construction material, including determinations that—</P>
                            <P>
                                (i) A subsistence product is perishable and delivery from the United 
                                <PRTPAGE P="245"/>
                                States would significantly impair the quality at the point of consumption;
                            </P>
                            <P>(ii) An end product or construction material, by its nature or as a practical matter, can best be acquired in the geographic area concerned, e.g., ice or books; or bulk material, such as sand, gravel, or other soil material, stone, concrete masonry units, or fired brick;</P>
                            <P>(iii) A particular domestic construction material is not available;</P>
                            <P>(iv) The cost of domestic construction material would exceed the cost of foreign construction material by more than 50 percent, calculated on the basis of—</P>
                            <P>(A) A particular construction material; or</P>
                            <P>(B) The comparative cost of application of the Balance of Payments Program to the total acquisition; or</P>
                            <P>(v) Use of a particular domestic construction material is impracticable;</P>
                            <P>(b) After receipt of offers—</P>
                            <P>
                                (1) The evaluated low offer (
                                <E T="03">see</E>
                                 Subpart 225.5) is an offer of an end product that—
                            </P>
                            <P>(i) Is a qualifying country end product;</P>
                            <P>(ii) Is an eligible product; or</P>
                            <P>(iii) If the acquisition is in support of operations in Afghanistan, a South Caucasus/Central and South Asian state end product listed in 225.401-70 (see 225.7704-2); or</P>
                            <P>(iv) Is a nonqualifying country end product, but application of the Balance of Payments Program evaluation factor would not result in award on a domestic offer; or</P>
                            <P>(2) The construction material is an eligible product or, if the acquisition is in support of operations in Afghanistan, the construction material is a South Caucasus/Central and South Asian state construction material (see 225.7704-2); or</P>
                            <P>(c) At any time during the acquisition process, the head of the agency determines that it is not in the public interest to apply the restrictions of the Balance of Payments Program to the end product or construction material.</P>
                            <CITA>[67 FR 20694, Apr. 26, 2002, as amended at 67 FR 77939, Dec. 20, 2002; 69 FR 1928, Jan. 13, 2004; 70 FR 2363, Jan. 13, 2005; 70 FR 73155, Dec. 9, 2005; 71 FR 58540, Oct. 4, 2006; 73 FR 53153, Sept. 15, 2008; 75 FR 81917, Dec. 29, 2010; 76 FR 76320, Dec. 7, 2011; 78 FR 59857, Sept. 30, 2013; 82 FR 61481, Dec. 28, 2017; 88 FR 6584, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7502</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>If the Balance of Payments Program applies to the acquisition, follow the procedures at PGI 225.7502.</P>
                            <CITA>[71 FR 62566, Oct. 26, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7503</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>Unless the entire acquisition is exempt from the Balance of Payments Program—</P>
                            <P>(a) Use the basic or an alternate of the clause at 252.225-7044, Balance of Payments Program—Construction Material, in solicitations and contracts for construction to be performed outside the United States, including acquisitions of commercial products or commercial components, with an estimated value greater than the simplified acquisition threshold but less than $6,708,000.</P>
                            <P>(1) Use the basic clause unless the acquisition is in support of operations in Afghanistan.</P>
                            <P>(2) Use the alternate I clause if the acquisition is in support of operations in Afghanistan.</P>
                            <P>(3) Use the alternate II clause in lieu of the basic clause if an alternate domestic content threshold will apply to the entire period of performance as approved by the senior procurement executive (see 225.101(d)), unless the acquisition is in support of operations in Afghanistan.</P>
                            <P>(4) Use the alternate III clause in lieu of the alternate I clause if—</P>
                            <P>(i) The acquisition is in support of operations in Afghanistan; and</P>
                            <P>(ii) An alternate domestic content threshold will apply to the entire period of performance as approved by the senior procurement executive (see 225.101(d)).</P>
                            <P>
                                (b) Use the basic or an alternate of the clause at 252.225-7045, Balance of 
                                <PRTPAGE P="246"/>
                                Payments Program—Construction Material Under Trade Agreements, in solicitations and contracts for construction to be performed outside the United States with an estimated value of $6,708,000 or more, including acquisitions of commercial products or commercial components.
                            </P>
                            <P>(1) Use the basic clause in solicitations and contracts with an estimated value of $13,296,489 or more, unless the acquisition is in support of operations in Afghanistan.</P>
                            <P>(2) Use the alternate I clause in solicitations and contracts with an estimated value of $6,708,000 or more, but less than $13,296,489 unless the acquisition is in support of operations in Afghanistan.</P>
                            <P>(3) Use the alternate II clause in solicitations and contracts with an estimated value of $13,296,489 or more and is in support of operations in Afghanistan.</P>
                            <P>(4) Use the alternate III clause in solicitations and contracts with an estimated value of $6,708,000 or more, but less than $13,296,489, and is in support of operations in Afghanistan.</P>
                            <P>(5) Use the alternate IV clause in lieu of the basic clause in solicitations and contracts, unless the acquisition is in support of operations in Afghanistan, when—</P>
                            <P>(i) The estimated value is $13,296,489 or more; and</P>
                            <P>(ii) An alternate domestic content threshold will apply to the entire period of performance as approved by the senior procurement executive (see 225.101(d)).</P>
                            <P>(6) Use the alternate V clause in lieu of the alternate I clause in solicitations and contracts, unless the acquisition is in support of operations in Afghanistan, when—</P>
                            <P>(i) The estimated value is $6,708,000 or more, but less than $13,296,489; and</P>
                            <P>(ii) An alternate domestic content threshold will apply to the entire period of performance as approved by the senior procurement executive (see 225.101(d)).</P>
                            <P>(7) Use the alternate VI clause in lieu of the alternate II clause in solicitations and contracts when—</P>
                            <P>(i) The estimated value is $13,296,489 or more;</P>
                            <P>(ii) The acquisition is in support of operations in Afghanistan; and</P>
                            <P>(iii) An alternate domestic content threshold will apply to the entire period of performance as approved by the senior procurement executive (see 225.101(d)).</P>
                            <P>(8) Use the alternate VII clause in lieu of the alternate III clause in solicitations and contracts when—</P>
                            <P>(i) The estimated value is $6,708,000 or more but less than $13,296,489;</P>
                            <P>(ii) The acquisition is in support of operations in Afghanistan; and</P>
                            <P>(iii) An alternate domestic content threshold will apply to the entire period of performance as approved by the senior procurement executive (see 225.101(d)).</P>
                            <CITA>[79 FR 65818, Nov. 5, 2014, as amended at 80 FR 81471, Dec. 30, 2015; 82 FR 61483, Dec. 28, 2017; 84 FR 72247, Dec. 31, 2019; 86 FR 74377, Dec. 30, 2021; 88 FR 6584, Jan. 31, 2023; 89 FR 11955, Feb. 15, 2024; 89 FR 20873, Mar. 26, 2024]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 225.76—Secondary Arab Boycott of Israel</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>71 FR 39006, July 11, 2006, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>225.7601</SECTNO>
                            <SUBJECT>Restriction.</SUBJECT>
                            <P>In accordance with 10 U.S.C. 4659, do not enter into a contract with a foreign entity unless it has certified that it does not comply with the secondary Arab boycott of Israel.</P>
                            <CITA>[71 FR 39006, July 11, 2006, as amended at 87 FR 76994, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7602</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>For contracts awarded to the Canadian Commercial Corporation (CCC), the CCC will submit a certification from its proposed subcontractor with the other required precontractual information (see 225.870).</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7603</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <P>This restriction does not apply to—</P>
                            <P>(a) Purchases at or below the simplified acquisition threshold;</P>
                            <P>(b) Contracts for consumable supplies, provisions, or services for the support of United States forces or of allied forces in a foreign country; or</P>
                            <P>
                                (c) Contracts pertaining to the use of any equipment, technology, data, or 
                                <PRTPAGE P="247"/>
                                services for intelligence or classified purposes, or to the acquisition or lease thereof, in the interest of national security.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7604</SECTNO>
                            <SUBJECT>Waivers.</SUBJECT>
                            <P>The Secretary of Defense may waive this restriction on the basis of national security interests. To request a waiver, follow the procedures at PGI 225.7604.</P>
                            <CITA>[71 FR 62566, Oct. 26, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7605</SECTNO>
                            <SUBJECT>Solicitation provision.</SUBJECT>
                            <P>Unless an exception at 225.7603 applies or a waiver has been granted in accordance with 225.7604, use the provision at 252.225-7031, Secondary Arab Boycott of Israel, in all solicitations, including solicitations using FAR part 12 procedures for the acquisition ofcommercial products and commercial services. If the solicitation includes the provision at FAR 52.204-7, do not separately list 252.225-7031 in the solicitation.</P>
                            <CITA>[71 FR 39006, July 11, 2006, as amended at 78 FR 37988, June 25, 2013; 78 FR 40043, July 3, 2013; 88 FR 6584, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 225.77—Acquisitions in Support of Operations in Afghanistan</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>73 FR 53153, Sept. 15, 2008, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>225.7700</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>This subpart implements—</P>
                            <P>(a) Section 892 of the National Defense Authorization Act for Fiscal Year 2008 (Pub. L. 110-181);</P>
                            <P>(b) Section 886 of the National Defense Authorization Act for Fiscal Year 2008 (Pub. L. 110-181), as amended by section 842 of the National Defense Authorization Act for Fiscal Year 2013 (Pub. L. 112-239);</P>
                            <P>(c) Section 826 of the National Defense Authorization Act for Fiscal Year 2013 (Pub. L. 112-239); and</P>
                            <P>(d) The determinations by the Deputy Secretary of Defense regarding participation of the countries of the South Caucasus or Central and South Asia in acquisitions in support of operations in Afghanistan.</P>
                            <P>(e) Section 1216 of the National Defense Authorization Act for Fiscal Year 2017 (Pub. L. 114-328).</P>
                            <CITA>[78 FR 59857, Sept. 30, 2013, as amended at 83 FR 16004, Apr. 13, 2018; 87 FR 15818, Mar. 18, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7701</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this subpart—</P>
                            <P>
                                <E T="03">Product from Afghanistan</E>
                                 means a product that is mined, produced, or manufactured in Afghanistan.
                            </P>
                            <P>
                                <E T="03">Service from Afghanistan</E>
                                 means a service including construction that is performed in Afghanistan predominantly by citizens or permanent resident aliens of Afghanistan.
                            </P>
                            <P>
                                <E T="03">Small arms</E>
                                 means pistols and other weapons less than 0.50 caliber.
                            </P>
                            <P>
                                <E T="03">Source from Afghanistan</E>
                                 means a source that—
                            </P>
                            <P>(1) Is located in Afghanistan; and</P>
                            <P>(2) Offers products or services from Afghanistan.</P>
                            <P>
                                <E T="03">Textile component</E>
                                 is defined in the clause at 252.225-7029, Acquisition of Uniform Components for Afghan Military or Afghan National Police.
                            </P>
                            <CITA>[78 FR 59857, Sept. 30, 2013]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7702</SECTNO>
                            <SUBJECT>Acquisitions not subject to the enhanced authority to acquire products or services from Afghanistan.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7702-1</SECTNO>
                            <SUBJECT>Acquisition of small arms.</SUBJECT>
                            <P>(a) Except as provided in paragraph (b) of this section, when acquiring small arms for assistance to the Army of Afghanistan, the Afghani Police Forces, or other Afghani security organizations—</P>
                            <P>(1) Use full and open competition to the maximum extent practicable, consistent with the provisions of 10 U.S.C. 3201;</P>
                            <P>(2) If use of other than full and open competition is justified in accordance with FAR Subpart 6.3, ensure that—</P>
                            <P>(i) No responsible U.S. manufacturer is excluded from competing for the acquisition; and</P>
                            <P>(ii) Products manufactured in the United States are not excluded from the competition; and</P>
                            <P>
                                (3) If the exception at FAR 6.302-2 (unusual and compelling urgency) applies, do not exclude responsible U.S. 
                                <PRTPAGE P="248"/>
                                manufacturers or products manufactured in the United States from the competition for the purpose of administrative expediency. However, such an offer may be rejected if it does not meet delivery schedule requirements.
                            </P>
                            <P>(b) Paragraph (a)(2) of this section does not apply when—</P>
                            <P>(1) The exception at FAR 6.302-1 (only one or a limited number of responsible sources) applies, and the only responsible source or sources are not U.S. manufacturers or are not offering products manufactured in the United States; or</P>
                            <P>(2) The exception at FAR 6.302-4 (international agreement) applies, and United States manufacturers or products manufactured in the United States are not the source(s) specified in the written directions of the foreign government reimbursing the agency for the cost of the acquisition of the property or services for such government.</P>
                            <CITA>[73 FR 53153, Sept. 15, 2008. Redesignated and amended at 78 FR 59858, Sept. 30, 2013; 87 FR 76994, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7702-2</SECTNO>
                            <SUBJECT>Acquisition of uniform components for the Afghan military or the Afghan police.</SUBJECT>
                            <P>Any textile components supplied by DoD to the Afghan National Army or the Afghan National Police for purpose of production of uniforms shall be produced in the United States.</P>
                            <CITA>[78 FR 59858, Sept. 30, 2013]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7703</SECTNO>
                            <SUBJECT>Enhanced authority to acquire products or services from Afghanistan.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7703-1</SECTNO>
                            <SUBJECT>Acquisition procedures.</SUBJECT>
                            <P>(a) Subject to the requirements of 225.7703-2, except as provided in 225.7702, a product or service (including construction)in support of operations in Afghanistan may be acquired by—</P>
                            <P>(1) Providing a preference for products or services from Afghanistan in accordance with the evaluation procedures at 225.7703-3;</P>
                            <P>(2) Limiting competition to products or services from Afghanistan; or</P>
                            <P>(3) Using procedures other than competitive procedures to award a contract to a particular source or sources from Afghanistan. When other than competitive procedures are used, the contracting officer shall document the contract file with the rationale for selecting the particular source(s).</P>
                            <P>(b) For acquisitions conducted using a procedure specified in paragraph (a) of this subsection, the justification and approval addressed in FAR Subpart 6.3 is not required.</P>
                            <P>(c) When issuing solicitations and contracts for performance in Afghanistan, follow the procedures at PGI 225.7703-1(c).</P>
                            <CITA>[73 FR 53153, Sept. 15, 2008, as amended at 78 FR 59858, Sept. 30, 2013; 79 FR 58695, Sept. 30, 2014]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7703-2</SECTNO>
                            <SUBJECT>Determination requirements.</SUBJECT>
                            <P>Before use of a procedure specified in 225.7703-1(a), a written determination must be prepared and executed as follows:</P>
                            <P>(a) For products or services to be used only by the military forces, police, or other security personnel of Afghanistan, the contracting officer shall—</P>
                            <P>(1) Determine in writing that the product or service is to be used only by the military forces, police, or other security personnel of Afghanistan; and</P>
                            <P>(2) Include the written determination in the contract file.</P>
                            <P>(b) For products or services not limited to use by the military forces, police, or other security personnel of Afghanistan, the following requirements apply:</P>
                            <P>(1) The appropriate official specified in paragraph (b)(2) of this subsection must determine in writing that it is in the national security interest of the United States to use a procedure specified in 225.7703-1(a), because—</P>
                            <P>(i) The procedure is necessary to provide a stable source of jobs in Afghanistan; and</P>
                            <P>(ii) Use of the procedure will not adversely affect—</P>
                            <P>(A) Operations in Afghanistan (including security, transition, reconstruction, and humanitarian relief activities); or</P>
                            <P>
                                (B) The U.S. industrial base. The authorizing official generally may presume that there will not be an adverse 
                                <PRTPAGE P="249"/>
                                effect on the U.S. industrial base. However, when in doubt, the authorizing official should coordinate with the applicable subject matter expert specified in PGI 225.7703-2(b).
                            </P>
                            <P>(2) Determinations may be made for an individual acquisition or a class of acquisitions meeting the criteria in paragraph (b)(1) of this subsection as follows:</P>
                            <P>(i) The head of the contacting activity is authorized to make a determination that applies to an individual acquisition with a value of less than $100 million.</P>
                            <P>(ii) The Principal Director, Defense Pricing, Contracting, and Acquisition Policy, and the following officials, without power of redelegation, are authorized to make a determination that applies to an individual acquisition with a value of $100 million or more or to a class of acquisitions:</P>
                            <P>(A) Defense Logistics Agency Component Acquisition Executive.</P>
                            <P>(B) Army Acquisition Executive.</P>
                            <P>(C) Navy Acquisition Executive.</P>
                            <P>(D) Air Force Acquisition Executive.</P>
                            <P>(E) Commander of the United States Central Command Joint Theater Support Contracting Command (C-JTSCC).</P>
                            <P>(3) The contracting officer—</P>
                            <P>(i) Shall include the applicable written determination in the contract file; and</P>
                            <P>(ii) Shall ensure that each contract action taken pursuant to the authority of a class determination is within the scope of the class determination, and shall document the contract file for each action accordingly.</P>
                            <P>(c) See PGI 225.7703-2(c) for formats for use in preparation of the determinations required by this subsection.</P>
                            <CITA>[73 FR 53153, Sept. 15, 2008, as amended at 75 FR 18039, Apr. 8, 2010; 75 FR 45074, Aug. 2, 2010; 78 FR 59858, Sept. 30, 2013; 80 FR 36905, June 26, 2015; 85 FR 61504, Sept. 29, 2020; 89 FR 60831, July 29, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7703-3</SECTNO>
                            <SUBJECT>Evaluating offers.</SUBJECT>
                            <P>Evaluate offers submitted in response to solicitations that include the provision at 252.225-7023, Preference for Products or Services from Afghanistan, as follows:</P>
                            <P>(a) If the low offer is an offer of a product or service from Afghanistan, award on that offer.</P>
                            <P>(b) If there are no offers of a product or service from Afghanistan, award on the low offer.</P>
                            <P>(c) Otherwise, apply the evaluation factor specified in the solicitation to the low offer.</P>
                            <P>(1) If the price of the low offer of a product or service from Afghanistan is less than the evaluated price of the low offer, award on the low offer of a product or service from Afghanistan.</P>
                            <P>(2) If the evaluated price of the low offer remains less than the low offer of a product or service from Afghanistan, award on the low offer.</P>
                            <CITA>[78 FR 59858, Sept. 30, 2013, as amended at 79 FR 56278, Sept. 19, 2014; 80 FR 72607, Nov. 20, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7703-4</SECTNO>
                            <SUBJECT>Solicitation provisions and contract clauses.</SUBJECT>
                            <P>(a) Use the provision at 252.225-7023, Preference for Products or Services from Afghanistan, in solicitations, including solicitations using FAR part 12 procedures for the acquisition of commercial products and commercial services, that provide a preference for products or services from Afghanistan in accordance with 225.7703-1(a)(1). The contracting officer may modify the 50 percent evaluation factor in accordance with contracting office procedures.</P>
                            <P>(b) Use the clause at 252.225-7024, Requirement for Products or Services from Afghanistan, in solicitations, including solicitations using FAR part 12 procedures for the acquisition of commercial products and commercial services, that include the provision at 252.225-7023, Preference for Products or Services from Afghanistan, and in the resulting contract.</P>
                            <P>(c) Use the clause at 252.225-7026, Acquisition Restricted to Products or Services from Afghanistan, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, that—</P>
                            <P>(1) Are restricted to the acquisition of products or services from Afghanistan in accordance with 225.7703-1(a)(2); or</P>
                            <P>
                                (2) Will be directed to a particular source or sources from Afghanistan in accordance with 225.7703-1(a)(3).
                                <PRTPAGE P="250"/>
                            </P>
                            <P>(d) Use the clause at 252.225-7029, Acquisition of Uniform Components for Afghan Military or Afghan National Police, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, for the acquisition of any textile components that DoD intends to supply to the Afghan National Army or the Afghan National Police for purposes of production of uniforms.</P>
                            <P>(e) When the Trade Agreements Act applies to the acquisition, use the appropriate clause and provision as prescribed at 225.1101 (5) and (6).</P>
                            <P>(f) Do not use any of the following provisions or clauses in solicitations or contracts that include the provision at 252.225-7023, the clause at 252.225-7024, or the clause at 252.225-7026:</P>
                            <P>(1) 252.225-7000, Buy American—Balance of Payments Program Certificate.</P>
                            <P>(2) 252.225-7001, Buy American and Balance of Payments Program.</P>
                            <P>(3) 252.225-7002, Qualifying Country Sources as Subcontractors.</P>
                            <P>(4) 252.225-7035, Buy American—Free Trade Agreements—Balance of Payments Program Certificate.</P>
                            <P>(5) 252.225-7036, Buy American—Free Trade Agreements—Balance of Payments Program.</P>
                            <P>(6) 252.225-7044, Balance of Payments Program—Construction Material.</P>
                            <P>(7) 252.225-7045, Balance of Payments Program—Construction Material Under Trade Agreements.</P>
                            <P>(g) Do not use the following clause or provision in solicitations or contracts that include the clause at 252.225-7026:</P>
                            <P>(1) 252.225-7020, Trade Agreements Certificate.</P>
                            <P>(2) 252.225-7021, Trade Agreements.</P>
                            <CITA>[78 FR 59858, Sept. 30, 2013, as amended at 84 FR 12140, Apr. 1, 2019; 88 FR 6584, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7704</SECTNO>
                            <SUBJECT>Acquisitions of products and services from South Caucasus/Central and South Asian (SC/CASA) state in support of operations in Afghanistan.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7704-1</SECTNO>
                            <SUBJECT>Applicability of trade agreements.</SUBJECT>
                            <P>As authorized by the United States Trade Representative, the Secretary of Defense has waived the prohibition in section 302(a) of the Trade Agreements Act (see subpart 225.4) for acquisitions by DoD, and by GSA on behalf of DoD, of products and services from SC/CASA states in direct support of operations in Afghanistan.</P>
                            <CITA>[75 FR 81918, Dec. 29, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7704-2</SECTNO>
                            <SUBJECT>Applicability of Balance of Payments Program.</SUBJECT>
                            <P>The Deputy Secretary of Defense has determined, because of importance to national security, that it would be inconsistent with the public interest to apply the provisions of the Balance of Payments Program (see subpart 225.75) to offers of end products other than arms, ammunition, and war materials (i.e., end products listed in 225.401-70) and construction materials from the SC/CASA states that are being acquired by or on behalf of DoD in direct support of operations in Afghanistan.</P>
                            <CITA>[75 FR 81918, Dec. 29, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7704-3</SECTNO>
                            <SUBJECT>Solicitation provisions and contract clauses.</SUBJECT>
                            <P>Appropriate solicitation provisions and contract clauses are prescribed as alternates to the Buy American-Trade Agreements-Balance of Payments Program solicitation provisions and contract clauses prescribed at 225.1101 and 225.7503.</P>
                            <CITA>[75 FR 81918, Dec. 29, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7705</SECTNO>
                            <SUBJECT>Prohibition on use of funds for contracts of certain programs and projects in Afghanistan that cannot be safely accessed.</SUBJECT>
                        </SECTION>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>83 FR 16004, Apr. 13, 2018, unless otherwise noted.</P>
                            <P>This section implements section 1216 of the National Defense Authorization Act for Fiscal Year 2017 (Pub. L. 114-328).</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>225.7705-1</SECTNO>
                            <SUBJECT>Prohibition.</SUBJECT>
                            <P>
                                The contracting officer shall not obligate or expend funds for a construction or other infrastructure program or project of the Department in Afghanistan if military or civilian personnel of the United States Government or their representatives, with authority to conduct oversight of such program or 
                                <PRTPAGE P="251"/>
                                project, cannot safely access such program or project. In limited circumstances, this prohibition may be waived in accordance with section 225.7705-2.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7705-2</SECTNO>
                            <SUBJECT>Waiver of prohibition.</SUBJECT>
                            <P>(a) The prohibition in 225.7705-1 may be waived upon issuance of a determination, approved in accordance with paragraph (b) of this section, that—</P>
                            <P>(1) The program or project clearly contributes to United States national interests or strategic objectives;</P>
                            <P>(2) The Government of Afghanistan has requested or expressed a need for the program or project;</P>
                            <P>(3) The program or project has been coordinated with the Government of Afghanistan, and with any other implementing agencies or international donors;</P>
                            <P>(4) Security conditions permit effective implementation and oversight of the program or project;</P>
                            <P>(5) Safeguards to detect, deter, and mitigate corruption and waste, fraud, and abuse of funds are in place;</P>
                            <P>(6) Adequate arrangements have been made for the sustainment of the program or project following its completion, including arrangements with respect to funding and technical capacity for sustainment; and</P>
                            <P>(7) Meaningful metrics have been established to measure the progress and effectiveness of the program or project in meeting its objectives.</P>
                            <P>(b) The following officials are authorized to approve the determination described in paragraph (a) of this section:</P>
                            <P>(1) In the case of a program or project with an estimated lifecycle cost of less than $1 million, by the contracting officer.</P>
                            <P>(2) In the case of a program or project with an estimated lifecycle cost of $1 million or more, but less than $20 million, by the senior U.S. officer in the Combined Security Transition Command-Afghanistan.</P>
                            <P>(3) In the case of a program or project with an estimated lifecycle cost of $20 million or more, but less than $40 million, by the Commander of United States Forces-Afghanistan.</P>
                            <P>(4) In the case of a program or project with an estimated lifecycle cost of $40 million or more, by the Secretary of Defense.</P>
                            <P>(c) Congressional notification is required within 15 days of issuance of a determination to waive the prohibition for programs or projects valued at $40 million or more in accordance with paragraph (b)(4) of this section.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7705-3</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>(a) The contracting officer shall not obligate or expend funds for contracts for a construction or other infrastructure program or project in Afghanistan, awarded after December 23, 2016, unless the requiring activity provides the following documentation:</P>
                            <P>(1) Written affirmation that military or civilian personnel of the United States Government or their representatives, with authority to conduct oversight of such program or project, can safely access such program or project; or</P>
                            <P>(2)(i) For programs or projects valued at less than $1 million, sufficient information upon which to base the determination described in 225.7705-2(a); or</P>
                            <P>(ii)(A) For programs or projects valued at $1 million or more, a copy of the approved determination described in 225.7705-2(a) and (b); and</P>
                            <P>(B) For programs or projects valued at $40 million or more, a copy of the Congressional notification described in 225.7705-2(c).</P>
                            <P>
                                (b) After contract award, the contracting officer shall review the requiring activity's progress reports (
                                <E T="03">e.g.,</E>
                                 contracting officer's representative reports) that addresses whether access continues to be safe or security conditions continue to permit effective implementation and oversight of the contract. If the requiring activity does not affirm continued safe access or, if a determination to waive the prohibition has been approved, that security conditions continue to permit effective implementation and oversight of the contract, then the contracting officer shall consult with the requiring activity to take any appropriate actions.
                            </P>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <PRTPAGE P="252"/>
                        <HD SOURCE="HED">Subpart 225.78—Acquisitions in Support of Geographic Combatant Command's Theater Security Cooperation Efforts</HD>
                        <SECTION>
                            <SECTNO>§ 225.7801</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>For guidance on procurement support of the geographic combatant command's theater security cooperation efforts, see PGI 225.78.</P>
                            <CITA>[76 FR 27274, May 11, 2011]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 225.79—EXPORT CONTROL</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>78 FR 36110, June 17, 2013, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>225.7900</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>This subpart implements—</P>
                            <P>(a) Section 890(a) of the National Defense Authorization Act for Fiscal Year 2008 (Pub. L. 110-181); and</P>
                            <P>
                                (b) The requirements regarding export control of Title I of the Security Cooperation Act of 2010 (Pub. L. 111-266); the Treaty Between the Government of the United States of America and the Government of Australia Concerning Defense Trade Cooperation (the U.S.-Australia DTC Treaty); and the Treaty Between the Government of the United States of America and the Government the United Kingdom of Great Britain and Northern Ireland Concerning Defense Trade Cooperation (the U.S.-U.K. DTC Treaty). See 
                                <E T="03">PGI 225.7902</E>
                                 for additional information.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7901</SECTNO>
                            <SUBJECT>Export-controlled items.</SUBJECT>
                            <P>This section implements section 890(a) of the National Defense Authorization Act for Fiscal Year 2008 (Pub. L. 110-181).</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7901-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>
                                “Export-controlled items,” as used in this section, is defined in the clause at 
                                <E T="03">252.225-7048.</E>
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7901-2</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>
                                Certain types of items are subject to export controls in accordance with the Arms Export Control Act (22 U.S.C. 2751, 
                                <E T="03">et seq.</E>
                                ), the International Traffic in Arms Regulations (22 CFR parts 120-130), the Export Administration Act of 1979, as amended (50 U.S.C. App. 2401 
                                <E T="03">et seq.</E>
                                ), and the Export Administration Regulations (15 CFR parts 730-774). See PGI 225.7901-2 for additional information.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7901-3</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(a) It is in the interest of both the Government and the contractor to be aware of export controls as they apply to the performance of DoD contracts.</P>
                            <P>(b) It is the contractor's responsibility to comply with all applicable laws and regulations regarding export-controlled items. This responsibility exists independent of, and is not established or limited by, this section.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7901-4</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>
                                Use the clause at 
                                <E T="03">252.225-7048</E>
                                , Export-Controlled Items, in all solicitations and contracts.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7902</SECTNO>
                            <SUBJECT>Defense Trade Cooperation Treaties.</SUBJECT>
                            <P>This section implements the Defense Trade Cooperation (DTC) Treaties with Australia and the United Kingdom and the associated Implementing Arrangements for DoD solicitations and contracts that authorize prospective contractors and contractors to use the DTC Treaties to respond to DoD solicitations and in the performance of DoD contracts.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7902-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>
                                “Approved community,” “defense articles,” “Defense Trade Cooperation (DTC) Treaty”, “export,” “Implementing Arrangement,” “qualifying defense articles,” “transfer,” and “U.S. DoD Treaty-eligible requirements” are defined in contract clause DFARS 
                                <E T="03">252.225-7047</E>
                                , Exports by Approved Community Members in Performance of the Contract.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7902-2</SECTNO>
                            <SUBJECT>Purpose.</SUBJECT>
                            <P>
                                The DTC Treaties permit the export of certain U.S. defense articles, technical data, and defense services, without U.S. export licenses or other written authorization under the International Traffic in Arms Regulation (ITAR) into and within the Approved Community, as long as the exports are in support of purposes specified in the DTC Treaties. All persons must continue to comply with statutory and 
                                <PRTPAGE P="253"/>
                                regulatory requirements outside of DFARS and ITAR concerning the import of defense articles and defense services or the possession or transfer of defense articles, including, but not limited to, regulations issued by the Bureau of Alcohol, Tobacco, Firearms and Explosives found at 27 CFR parts 447, 478, and 479, which are unaffected by the DTC Treaties. The Approved Community consists of U.S. entities that are registered with the Department of State and are eligible exporters, the U.S. Government, and certain governmental and commercial facilities in Australia and the United Kingdom that are approved and listed by the U.S. Government. See 
                                <E T="03">PGI 225.7902-2</E>
                                 for additional information.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7902-3</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>DoD will facilitate maximum use of the DTC Treaties by prospective contractors responding to DoD solicitations and by contractors eligible to export qualifying defense articles under DoD contracts in accordance with 22 CFR 126.16(g) and 22 CFR 126.17(g).</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7902-4</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>
                                (a) For all solicitations and contracts that may be eligible for DTC Treaty coverage (see 
                                <E T="03">PGI 225.7902-4</E>
                                (1)), the program manager shall identify in writing and submit to the contracting officer prior to issuance of a solicitation and prior to award of a contract—
                            </P>
                            <P>(1) The qualifying DTC Treaty Scope paragraph (Article 3(1)(a), 3(1)(b), or 3(1)(d) of the U.S.-Australia DTC Treaty or Article (3)(1)(a), (3(1)(b), or 3(1)(d) of the U.S.-U.K. DTC Treaty); and</P>
                            <P>(2) The qualifying defense article(s) using the categories described in 22 CFR 126.16(g) and 22 CFR 126.17(g).</P>
                            <P>
                                (b) If applicable, the program manager shall also identify in writing and submit to the contracting officer any specific Part C, DTC Treaty-exempted technology list items, terms and conditions for applicable contract line item numbers (See 
                                <E T="03">PGI 225.7902-4</E>
                                (2)).
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>225.7902-5</SECTNO>
                            <SUBJECT>Solicitation provision and contract clause.</SUBJECT>
                            <P>
                                (a) Use the provision at 
                                <E T="03">252.225-7046</E>
                                , Exports by Approved Community Members in Response to the Solicitation, in solicitations containing the clause at 
                                <E T="03">252.225-7047.</E>
                            </P>
                            <P>
                                (b)(1) Use the clause at 
                                <E T="03">252.225-7047</E>
                                , Exports by Approved Community Members in Performance of the Contract, in solicitations and contracts when—
                            </P>
                            <P>(i) Export-controlled items are expected to be involved in the performance of the contract and the clause at 252.225-7048 is used; and</P>
                            <P>(ii) At least one contract line item is intended to satisfy a U.S. DoD Treaty-eligible requirement.</P>
                            <P>
                                (2) The contracting officer shall complete paragraph (b) of the clause using information the program manager provided as required by 
                                <E T="03">225.7902-4</E>
                                (a).
                            </P>
                            <CITA>[78 FR 36110, June 17, 2013, as amended at 78 FR 38235, June 26, 2013; 78 FR 40043, July 3, 2013]</CITA>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 226</EAR>
                    <HD SOURCE="HED">PART 226—OTHER SOCIOECONOMIC PROGRAMS</HD>
                    <CONTENTS>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 226.1—Indian Incentive Program</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>226.103</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>226.104</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 226.5—Drug-Free Workplace</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>226.570</SECTNO>
                            <SUBJECT>Drug-free work force.</SUBJECT>
                            <SECTNO>226.570-1</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>226.570-2</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <RESERVED>Subpart 226.70 [Reserved]</RESERVED>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 226.71—Preference for Local and Small Businesses</HD>
                            <SECTNO>226.7100</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>226.7101</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <SECTNO>226.7102</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>226.7103</SECTNO>
                            <SUBJECT>Procedure.</SUBJECT>
                            <SECTNO>226.7104</SECTNO>
                            <SUBJECT>Other considerations.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 226.72—Demonstration Project for Contractors Employing Persons With Disabilities</HD>
                            <SECTNO>226.7200</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>226.7201</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>226.7202</SECTNO>
                            <SUBJECT>Policy and procedures.</SUBJECT>
                            <SECTNO>226.7203</SECTNO>
                            <SUBJECT>Solicitation provision.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36388, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SUBPART>
                        <PRTPAGE P="254"/>
                        <HD SOURCE="HED">Subpart 226.1—Indian Incentive Program</HD>
                        <SECTION>
                            <SECTNO>226.103</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>Follow the procedures at PGI 226.103 when submitting a request for funding of an Indian incentive.</P>
                            <CITA>[70 FR 73149, Dec. 9, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>226.104</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at 252.226-7001, Utilization of Indian Organizations, Indian-Owned Economic Enterprises, and Native Hawaiian Small Business Concerns, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, that are for supplies or services exceeding $500,000 in value.</P>
                            <CITA>[68 FR 56562, Oct. 1, 2003, as amended at 69 FR 55991, Sept. 17, 2004; 78 FR 37988, June 25, 2013; 88 FR 6584, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 226.5—Drug-Free Workplace</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>89 FR 66284, Aug. 15, 2024, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>226.570</SECTNO>
                            <SUBJECT>Drug-free work force.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>226.570-1</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>DoD policy is to ensure that its contractors maintain a program for achieving a drug-free work force.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>226.570-2</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>(a) Use the clause at 252.226-7003, Drug-Free Work Force, in all solicitations and contracts--</P>
                            <P>(1) That invoke access to classified information; or</P>
                            <P>(2) When the contracting officer determines that the clause is necessary for reasons of national security or for the purpose of protecting the health or safety of those using or affected by the product of, or performance of, the contract.</P>
                            <P>(b) Do not use the clause in solicitations or contracts--</P>
                            <P>(1) For commercial products and commercial services;</P>
                            <P>(2) When performance or partial performance will be outside the United States and its outlying areas, unless the contracting officer determines such inclusion to be in the best interest of the Government; or</P>
                            <P>(3) When the value of the acquistion is at or below the simplified acquisition threshold.</P>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <RESERVED>Subpart 226.70 [Reserved]</RESERVED>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 226.71—Preference for Local and Small Businesses</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>59 FR 12192, Mar. 16, 1994, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>226.7100</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>This subpart implements section 2912 of the Fiscal Year 1994 Defense Authorization Act (Pub. L. 103-160) and section 817 of the Fiscal Year 1995 Defense Authorization Act (Pub. L. 103-337).</P>
                            <CITA>[60 FR 5870, Jan. 31, 1995]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>226.7101</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <P>
                                <E T="03">Vicinity,</E>
                                 as used in this subpart, means the county or counties in which the military installation to be closed or realigned is located and all adjacent counties, unless otherwise defined by the agency head.
                            </P>
                            <CITA>[60 FR 29499, June 5, 1995]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>226.7102</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>Businesses located in the vicinity of a military installation that is being closed or realigned under a base closure law, including 10 U.S.C. 2687, and small and small disadvantaged businesses shall be provided maximum practicable opportunity to participate in acquisitions that support the closure or realignment, including acquisitions for environmental restoration and mitigation.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>226.7103</SECTNO>
                            <SUBJECT>Procedure.</SUBJECT>
                            <P>In considering acquisitions for award through the section 8(a) program (subpart 219.8 and FAR subpart 19.8) or in making set-aside decisions under subpart 219.5 and FAR subpart 19.5 for acquisitions in support of a base closure or realignment, the contracting officer shall—</P>
                            <P>
                                (a) Determine whether there is a reasonable expectation that offers will be 
                                <PRTPAGE P="255"/>
                                received from responsible business concerns located in the vicinity of the military installation that is being closed or realigned.
                            </P>
                            <P>(b) If offers can not be expected from business concerns in the vicinity, proceed with section 8(a) or set-aside consideration as otherwise indicated in part 219 and FAR part 19.</P>
                            <P>(c) If offers can be expected from business concerns in the vicinity—</P>
                            <P>(1) Consider section 8(a) only if at least one eligible 8(a) contractor is located in the vicinity.</P>
                            <P>(2) Set aside the acquisition for small business only if at least one of the expected offers is from a small business located in the vicinity.</P>
                            <CITA>[60 FR 29499, June 5, 1995, as amended at 63 FR 41974, Aug. 6, 1998; 67 FR 11438, Mar. 14, 2002]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>226.7104</SECTNO>
                            <SUBJECT>Other considerations.</SUBJECT>
                            <P>When planning for contracts for services related to base closure activities at a military installation affected by a closure or realignment under a base closure law, contracting officers shall consider including, as a factor in source selection, the extent to which offerors specifically identify and commit, in their proposals, to a plan to hire residents of the vicinity of the military installation that is being closed or realigned.</P>
                            <CITA>[60 FR 61598, Nov. 30, 1995]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 226.72—Demonstration Project for Contractors Employing Persons With Disabilities</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>84 FR 72560, Dec. 31, 2019, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>226.7200</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>This subpart implements section 853 of the National Defense Authorization Act for Fiscal Year 2004 (Pub. L. 108-136, 10 U.S.C. 3901 note prec.). Nothing in this subpart supersedes the requirement to use the mandatory sources in FAR part 8 or the small business programs in FAR part 19.</P>
                            <CITA>[84 FR 72560, Dec. 31, 2019, as amended at 87 FR 76994, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>226.7201</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this subpart—</P>
                            <P>
                                <E T="03">Eligible contractor</E>
                                 means a business entity operated on a for-profit or nonprofit basis that—
                            </P>
                            <P>(1) Employs severely disabled individuals at a rate that averages not less than 33 percent of its total workforce over the 12-month period prior to issuance of the solicitation;</P>
                            <P>(2) Pays not less than the minimum wage prescribed pursuant to 29 U.S.C. 206 to the employees who are severely disabled individuals; and</P>
                            <P>(3) Provides, for its employees, health insurance and a retirement plan comparable to those provided for employees by business entities of similar size in its industrial sector or geographic region.</P>
                            <P>
                                <E T="03">Severely disabled individual</E>
                                 means an individual with a disability (as defined in 42 U.S.C. 12102) who has a severe physical or mental impairment that seriously limits one or more functional capacities.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>226.7202</SECTNO>
                            <SUBJECT>Policy and procedures.</SUBJECT>
                            <P>(a)(1) Contracting officers may use this Demonstration Project to award one or more contracts to an eligible contractor for the purpose of providing defense contracting opportunities for entities that employ severely disabled individuals. To determine if there are eligible contractors capable of fulfilling the agency's requirement, conduct market research as described in 210.002 and FAR 10.002. For services, see also PGI 210.070.</P>
                            <P>(2) If the contracting officer elects to use this Demonstration Project, FAR 6.302-5 requires a written justification and approval to limit competition to eligible contractors. In the justification, identify the statutory authority for the Demonstration Project (10 U.S.C. 3901 note prec.).</P>
                            <P>
                                (b) When using this Demonstration Project, one of the evaluation factors shall be the percentage of the offeror's total workforce that consists of severely disabled individuals employed by the offeror. Contracting officers may use a rating method in which a higher percentage of the offeror's total workforce consisting of severely disabled individuals would result in a 
                                <PRTPAGE P="256"/>
                                higher rating for this evaluation factor.
                            </P>
                            <P>(c)(1) Contracts awarded to eligible contractors under this Demonstration Project shall be counted toward DoD's small disadvantaged business goal. The contractor must be an eligible contractor when options under the contract are exercised, in order for DoD to continue to receive credit for the contract toward its small disadvantaged business goal.</P>
                            <P>
                                (2) Contracting officers shall verify the contractor's representation (
                                <E T="03">e.g.,</E>
                                 by checking the System for Award Management) prior to exercising an option on a contract awarded under the Demonstration Project. Contracting officers may exercise the option if the contractor has represented that it is not an eligible contractor; however, the contract shall no longer be counted toward DoD's small disadvantaged business goal.
                            </P>
                            <CITA>[84 FR 72560, Dec. 31, 2019, as amended at 87 FR 76994, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>226.7203</SECTNO>
                            <SUBJECT>Solicitation provision.</SUBJECT>
                            <P>Use the provision at 252.226-7002, Representation for Demonstration Project for Contractors Employing Persons with Disabilities, in solicitations when using this Demonstration Project, including solicitations using FAR part 12 procedures for the acquisition of commercial products and commercial services.</P>
                            <CITA>[84 FR 72560, Dec. 31, 2019, as amended at 88 FR 6584, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                </PART>
            </SUBCHAP>
            <SUBCHAP TYPE="P">
                <PRTPAGE P="257"/>
                <HD SOURCE="HED">SUBCHAPTER E—GENERAL CONTRACTING REQUIREMENTS</HD>
                <PART>
                    <EAR>Pt. 227</EAR>
                    <HD SOURCE="HED">PART 227—PATENTS, DATA, AND COPYRIGHTS</HD>
                    <CONTENTS>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 227.3—Patent Rights Under Government Contracts</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>227.303</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <SECTNO>227.304</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>227.304-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 227.4—Rights in Data and Copyrights</HD>
                            <SECTNO>227.400</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 227.6—Foreign License and Technical Assistance Agreements</HD>
                            <SECTNO>227.670</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>227.671</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>227.672</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>227.673</SECTNO>
                            <SUBJECT>Foreign license and technical assistance agreements between the Government and domestic concerns.</SUBJECT>
                            <SECTNO>227.674</SECTNO>
                            <SUBJECT>Supply contracts between the Government and a foreign government or concern.</SUBJECT>
                            <SECTNO>227.675</SECTNO>
                            <SUBJECT>Foreign license and technical assistance agreements between a domestic concern and a foreign government or concern.</SUBJECT>
                            <SECTNO>227.675-1</SECTNO>
                            <SUBJECT>International Traffic in Arms Regulations.</SUBJECT>
                            <SECTNO>227.675-2</SECTNO>
                            <SUBJECT>Review of agreements.</SUBJECT>
                            <SECTNO>227.676</SECTNO>
                            <SUBJECT>Foreign patent interchange agreements.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 227.70—Infringement Claims, Licenses, and Assignments</HD>
                            <SECTNO>227.7000</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>227.7001</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>227.7002</SECTNO>
                            <SUBJECT>Statutes pertaining to administrative claims of infringement.</SUBJECT>
                            <SECTNO>227.7003</SECTNO>
                            <SUBJECT>Claims for copyright infringement.</SUBJECT>
                            <SECTNO>227.7004</SECTNO>
                            <SUBJECT>Requirements for filing an administrative claim for patent infringement.</SUBJECT>
                            <SECTNO>227.7005</SECTNO>
                            <SUBJECT>Indirect notice of patent infringement claims.</SUBJECT>
                            <SECTNO>227.7006</SECTNO>
                            <SUBJECT>Investigation and administrative disposition of claims.</SUBJECT>
                            <SECTNO>227.7007</SECTNO>
                            <SUBJECT>Notification and disclosure to claimants.</SUBJECT>
                            <SECTNO>227.7008</SECTNO>
                            <SUBJECT>Settlement of indemnified claims.</SUBJECT>
                            <SECTNO>227.7009</SECTNO>
                            <SUBJECT>Patent releases, license agreements, and assignments.</SUBJECT>
                            <SECTNO>227.7009-1</SECTNO>
                            <SUBJECT>Required clauses.</SUBJECT>
                            <SECTNO>227.7009-2</SECTNO>
                            <SUBJECT>Clauses to be used when applicable.</SUBJECT>
                            <SECTNO>227.7009-3</SECTNO>
                            <SUBJECT>Additional clauses—contracts except running royalty contracts.</SUBJECT>
                            <SECTNO>227.7009-4</SECTNO>
                            <SUBJECT>Additional clauses—contracts providing for payment of a running royalty.</SUBJECT>
                            <SECTNO>227.7010</SECTNO>
                            <SUBJECT>Assignments.</SUBJECT>
                            <SECTNO>227.7011</SECTNO>
                            <SUBJECT>Procurement of rights in inventions, patents, and copyrights.</SUBJECT>
                            <SECTNO>227.7012</SECTNO>
                            <SUBJECT>Contract format.</SUBJECT>
                            <SECTNO>227.7013</SECTNO>
                            <SUBJECT>Recordation.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 227.71—Technical Data and Associated Rights</HD>
                            <SECTNO>227.7100</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>227.7101</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>227.7102</SECTNO>
                            <SUBJECT>Commercial products, commercial components, commercial services, or commercial processes.</SUBJECT>
                            <SECTNO>227.7102-1</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>227.7102-2</SECTNO>
                            <SUBJECT>Rights in technical data.</SUBJECT>
                            <SECTNO>227.7102-3</SECTNO>
                            <SUBJECT>Government right to review, verify, challenge, and validate asserted restrictions.</SUBJECT>
                            <SECTNO>227.7102-4</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <SECTNO>227.7103</SECTNO>
                            <SUBJECT>Other than commercial products, commercial services, or commercial processes.</SUBJECT>
                            <SECTNO>227.7103-1</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>227.7103-2</SECTNO>
                            <SUBJECT>Acquisition of technical data.</SUBJECT>
                            <SECTNO>227.7103-3</SECTNO>
                            <SUBJECT>Early identification of technical data to be furnished to the Government with restrictions on use, reproduction,  or disclosure.</SUBJECT>
                            <SECTNO>227.7103-4</SECTNO>
                            <SUBJECT>License rights.</SUBJECT>
                            <SECTNO>227.7103-5</SECTNO>
                            <SUBJECT>Government rights.</SUBJECT>
                            <SECTNO>227.7103-6</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <SECTNO>227.7103-7</SECTNO>
                            <SUBJECT>Use and non-disclosure agreement.</SUBJECT>
                            <SECTNO>227.7103-8</SECTNO>
                            <SUBJECT>Deferred delivery and deferred ordering of technical data.</SUBJECT>
                            <SECTNO>227.7103-9</SECTNO>
                            <SUBJECT>Copyright.</SUBJECT>
                            <SECTNO>227.7103-10</SECTNO>
                            <SUBJECT>Contractor identification and marking of technical data to be furnished with restrictive markings.</SUBJECT>
                            <SECTNO>227.7103-11</SECTNO>
                            <SUBJECT>Contractor procedures and records.</SUBJECT>
                            <SECTNO>227.7103-12</SECTNO>
                            <SUBJECT>Government right to establish conformity of markings.</SUBJECT>
                            <SECTNO>227.7103-13</SECTNO>
                            <SUBJECT>Government right to review, verify, challenge, and validate asserted restrictions.</SUBJECT>
                            <SECTNO>227.7103-14</SECTNO>
                            <SUBJECT>Conformity, acceptance, and warranty of technical data.</SUBJECT>
                            <SECTNO>227.7103-15</SECTNO>
                            <SUBJECT>Subcontractor rights in technical data.</SUBJECT>
                            <SECTNO>227.7103-16</SECTNO>
                            <SUBJECT>Providing technical data to foreign governments, foreign contractors, or international organizations.</SUBJECT>
                            <SECTNO>227.7103-17</SECTNO>
                            <SUBJECT>Overseas contracts with foreign sources.</SUBJECT>
                            <SECTNO>227.7104</SECTNO>
                            <SUBJECT>Contracts under the Small Business Innovation Research (SBIR) Program.</SUBJECT>
                            <SECTNO>227.7105</SECTNO>
                            <SUBJECT>
                                Contracts for the acquisition of existing works.
                                <PRTPAGE P="258"/>
                            </SUBJECT>
                            <SECTNO>227.7105-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>227.7105-2</SECTNO>
                            <SUBJECT>Acquisition of existing works without modification.</SUBJECT>
                            <SECTNO>227.7105-3</SECTNO>
                            <SUBJECT>Acquisition of modified existing works.</SUBJECT>
                            <SECTNO>227.7106</SECTNO>
                            <SUBJECT>Contracts for special works.</SUBJECT>
                            <SECTNO>227.7107</SECTNO>
                            <SUBJECT>Contracts for architect-engineer services.</SUBJECT>
                            <SECTNO>227.7107-1</SECTNO>
                            <SUBJECT>Architectural designs and data clauses for architect-engineer or construction contracts.</SUBJECT>
                            <SECTNO>227.7107-2</SECTNO>
                            <SUBJECT>Contracts for construction supplies and research and development work.</SUBJECT>
                            <SECTNO>227.7107-3</SECTNO>
                            <SUBJECT>Approval of restricted designs.</SUBJECT>
                            <SECTNO>227.7108</SECTNO>
                            <SUBJECT>Contractor data repositories.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 227.72—Computer Software, Computer Software Documentation, and Associated Rights</HD>
                            <SECTNO>227.7200</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>227.7201</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>227.7202</SECTNO>
                            <SUBJECT>Commercial computer software and commercial computer software documentation.</SUBJECT>
                            <SECTNO>227.7202-1</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>227.7202-2</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>227.7202-3</SECTNO>
                            <SUBJECT>Rights in commercial computer software or commercial computer software documentation.</SUBJECT>
                            <SECTNO>227.7202-4</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <SECTNO>227.7203</SECTNO>
                            <SUBJECT>Other than commercial computer software and other than commercial computer software documentation.</SUBJECT>
                            <SECTNO>227.7203-1</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>227.7203-2</SECTNO>
                            <SUBJECT>Acquisition of other than commercial computer software and computer software documentation and associated rights.</SUBJECT>
                            <SECTNO>227.7203-3</SECTNO>
                            <SUBJECT>Early identification of computer software or computer software documentation to be furnished to the Government with restrictions on use, reproduction, or disclosure.</SUBJECT>
                            <SECTNO>227.7203-4</SECTNO>
                            <SUBJECT>License rights.</SUBJECT>
                            <SECTNO>227.7203-5</SECTNO>
                            <SUBJECT>Government rights.</SUBJECT>
                            <SECTNO>227.7203-6</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <SECTNO>227.7203-8</SECTNO>
                            <SUBJECT>Deferred delivery and deferred ordering of computer software and computer software documentation.</SUBJECT>
                            <SECTNO>227.7203-9</SECTNO>
                            <SUBJECT>Copyright.</SUBJECT>
                            <SECTNO>227.7203-10</SECTNO>
                            <SUBJECT>Contractor identification and marking of computer software or computer software documentation to be furnished with restrictive markings.</SUBJECT>
                            <SECTNO>227.7203-11</SECTNO>
                            <SUBJECT>Contractor procedures and records.</SUBJECT>
                            <SECTNO>227.7203-12</SECTNO>
                            <SUBJECT>Government right to establish conformity of markings.</SUBJECT>
                            <SECTNO>227.7203-13</SECTNO>
                            <SUBJECT>Government right to review, verify, challenge, and validate asserted restrictions.</SUBJECT>
                            <SECTNO>227.7203-14</SECTNO>
                            <SUBJECT>Conformity, acceptance, and warranty of computer software and computer software documentation.</SUBJECT>
                            <SECTNO>227.7203-15</SECTNO>
                            <SUBJECT>Subcontractor rights in computer software or computer software documentation.</SUBJECT>
                            <SECTNO>227.7203-16</SECTNO>
                            <SUBJECT>Providing computer software or computer software documentation to foreign governments, foreign contractors, or international organizations.</SUBJECT>
                            <SECTNO>227.7203-17</SECTNO>
                            <SUBJECT>Overseas contracts with foreign sources.</SUBJECT>
                            <SECTNO>227.7204</SECTNO>
                            <SUBJECT>Contracts under the Small Business Innovative Research Program.</SUBJECT>
                            <SECTNO>227.7205</SECTNO>
                            <SUBJECT>Contracts for special works.</SUBJECT>
                            <SECTNO>227.7206</SECTNO>
                            <SUBJECT>Contracts for architect-engineer services.</SUBJECT>
                            <SECTNO>227.7207</SECTNO>
                            <SUBJECT>Contractor data repositories.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36389, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 227.3—Patent Rights Under Government Contracts</HD>
                        <SECTION>
                            <SECTNO>227.303</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>(1) Use the clause at 252.227-7039, Patents—Reporting of Subject Inventions, in solicitations and contracts containing the clause at FAR 52.227-11, Patent Rights—Ownership by the Contractor.</P>
                            <P>(2)(i) Use the clause at 252.227-7038, Patent Rights—Ownership by the Contractor (Large Business), instead of the clause at FAR 52.227-11, in solicitations and contracts for experimental, developmental, or research work if—</P>
                            <P>(A) The contractor is other than a small business concern or nonprofit organization; and</P>
                            <P>(B) No alternative patent rights clause is used in accordance with FAR 27.303(c) or (e).</P>
                            <P>(ii) Use the clause with its Alternate I if—</P>
                            <P>(A) The acquisition of patent rights for the benefit of a foreign government is required under a treaty or executive agreement;</P>
                            <P>(B) The agency head determines at the time of award that it would be in the national interest to acquire the right to sublicense foreign governments or international organizations pursuant to any existing or future treaty or agreement; or</P>
                            <P>
                                (C) Other rights are necessary to effect a treaty or agreement, in which case Alternate I may be appropriately modified.
                                <PRTPAGE P="259"/>
                            </P>
                            <P>(iii) Use the clause with its Alternate II in long-term contracts if necessary to effect treaty or agreements to be entered into.</P>
                            <CITA>[72 FR 69159, Dec. 7, 2007]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.304</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.304-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>Interim and final invention reports and notification of all subcontracts for experimental, developmental, or research work may be submitted on DD Form 882, Report of Inventions and Subcontracts.</P>
                            <CITA>[56 FR 36389, July 31, 1991, as amended at 57 FR 53600, Nov. 12, 1992; 76 FR 76320, Dec. 7, 2011]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 227.4—Rights in Data and Copyrights</HD>
                        <SECTION>
                            <SECTNO>227.400</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>DoD activities shall use the guidance in subparts 227.71 and 227.72 instead of the guidance in FAR subpart 27.4.</P>
                            <CITA>[60 FR 33471, June 28, 1995]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 227.6—Foreign License and Technical Assistance Agreements</HD>
                        <SECTION>
                            <SECTNO>227.670</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>This subpart prescribes policy with respect to foreign license and technical assistance agreements.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.671</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>In furtherance of the Military Assistance Program or for other national defense purposes, the Government may undertake to develop or encourage the development of foreign additional sources of supply. The development of such sources may be accomplished by an agreement, often called a foreign licensing agreement or technical assistance agreement, wherein a domestic concern, referred to in this subpart as a “primary source,” agrees to furnish to a foreign concern or government, herein referred to as a “second source;” foreign patent rights; technical assistance in the form of data, know-how, trained personnel of the primary source, instruction and guidance of the personnel of the second source, jigs, dies, fixtures, or other manufacturing aids, or such other assistance, information, rights, or licenses as are needed to enable the second source to produce particular supplies or perform particular services. Agreements calling for one or more of the foregoing may be entered into between the primary source and the Government, a foreign government, or a foreign concern. The consideration for providing such foreign license and technical assistance may be in the form of a lump sum payment, payments for each item manufactured by the second source, an agreement to exchange data and patent rights on improvements made to the article or service, capital stock transactions, or any combination of these. The primary source's bases for computing such consideration may include actual costs; charges for the use of patents, data, or know-how reflecting the primary source's investment in developing and engineering and production techniques; and the primary source's “price” for setting up a second source. Such agreements often refer to the compensation to be paid as a royalty or license fee whether or not patent rights are involved.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.672</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>It is Government policy not to pay in connection with its contracts, and not to allow to be paid in connection with contracts made with funds derived through the Military Assistance Program or otherwise through the United States Government, charges for use of patents in which it holds a royalty-free license or charges for data which it has a right to use and disclose to others, or which is in the public domain, or which the Government has acquired without restriction upon its use and disclosure to others. This policy shall be applied by the Departments in negotiating contract prices for foreign license technical assistance contracts (227.675) or supply contracts with second sources (227.674); and in commenting on such agreements when they are referred to the Department of Defense by the Department of State pursuant to section 414 of the Mutual Security Act of 1954 as amended (22 U.S.C. 1934) and the International Traffic in Arms Regulations (see 227.675).</P>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="260"/>
                            <SECTNO>227.673</SECTNO>
                            <SUBJECT>Foreign license and technical assistance agreements between the Government and domestic concerns.</SUBJECT>
                            <P>(a) Contracts between the Government and a primary source to provide technical assistance or patent rights to a second source for the manufacture of supplies or performance of services shall, to the extent practicable, specify the rights in patents and data and any other rights to be supplied to the second source. Each contract shall provide, in connection with any separate agreement between the primary source and the second source for patent rights or technical assistance relating to the articles or services involved in the contract, that—</P>
                            <P>(1) The primary source and his subcontractors shall not make, on account of any purchases by the Government or by others with funds derived through the Military Assistance Program or otherwise through the Government, any charge to the second source for royalties or amortization for patents or inventions in which the Government holds a royalty-free license; or data which the Government has the right to possess, use, and disclose to others; or any technical assistance provided to the second source for which the Government has paid under a contract between the Government and the primary source; and</P>
                            <P>(2) The separate agreement between the primary and second source shall include a statement referring to the contract between the Government and the primary source, and shall conform to the requirements of the International Traffic in Arms Regulations (see 227.675-1).</P>
                            <P>(b) The following factors, among others, shall be considered in negotiating the price to be paid the primary source under contracts within (a) of this section:</P>
                            <P>(1) The actual cost of providing data, personnel, manufacturing aids, samples, spare parts, and the like;</P>
                            <P>(2) The extent to which the Government has contributed to the development of the supplies or services, and to the methods of manufacture or performance, through past contracts for research and development or for manufacture of the supplies or performance of the services; and</P>
                            <P>(3) The Government's patent rights and rights in data relating to the supplies or services and to the methods of manufacture or of performance.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.674</SECTNO>
                            <SUBJECT>Supply contracts between the Government and a foreign government or concern.</SUBJECT>
                            <P>In negotiating contract prices with a second source, including the redetermination of contract prices, or in determining the allowability of costs under a cost-reimbursement contract with a second source, the contracting officer:</P>
                            <P>(a) Shall obtain from the second source a detailed statement (see FAR 27.204-1(a)(2)) of royalties, license fees, and other compensation paid or to be paid to a primary source (or any of his subcontractors) for patent rights, rights in data, and other technical assistance provided to the second source, including identification and description of such patents, data, and technical assistance; and</P>
                            <P>(b) Shall not accept or allow charges which in effect are—</P>
                            <P>(1) For royalties or amortization for patents or inventions in which the Government holds a royalty-free license; or</P>
                            <P>(2) For data which the Government has a right to possess, use, and disclose to others; or</P>
                            <P>(3) For any technical assistance provided to the second source for which the Government has paid under a contract between the Government and a primary source.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.675</SECTNO>
                            <SUBJECT>Foreign license and technical assistance agreements between a domestic concern and a foreign government or concern.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.675-1</SECTNO>
                            <SUBJECT>International Traffic in Arms Regulations.</SUBJECT>
                            <P>
                                Pursuant to section 414 of the Mutual Security Act of 1954, as amended (22 U.S.C. 1934), the Department of State controls the exportation of data relating to articles designated in the United States Munitions List as arms, ammunition, or munitions of war. (The Munitions List and pertinent procedures are set forth in the International Traffic in 
                                <PRTPAGE P="261"/>
                                Arms Regulations, 22 CFR, 
                                <E T="03">et seq.</E>
                                ) Before authorizing such exportation, the Department of State generally requests comments from the Department of Defense. On request of the Office of the Assistant Secretary of Defense (International Security Affairs), each Department shall submit comments thereon as the basis for a Department of Defense reply to the Department of State.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.675-2</SECTNO>
                            <SUBJECT>Review of agreements.</SUBJECT>
                            <P>(a) In reviewing foreign license and technical assistance agreements between primary and second sources, the Department concerned shall, insofar as its interests are involved, indicate whether the agreement meets the requirements of §§ 124.07-124.10 of the International Traffic in Arms Regulations or in what respects it is deficient. Paragraphs (b) through (g) of this subsection provide general guidance.</P>
                            <P>(b) When it is reasonably anticipated that the Government will purchase from the second source the supplies or services involved in the agreement, or that Military Assistance Program funds will be provided for the procurement of the supplies or services, the following guidance applies.</P>
                            <P>(1) If the agreement specifies a reduction in charges thereunder, with respect to purchases by or for the Government or by others with funds derived through the Military Assistance Program or otherwise through the Government, in recognition of the Government's rights in patents and data, the Department concerned shall evaluate the amount of the reduction to determine whether it is fair and reasonable in the circumstances, before indicating its approval.</P>
                            <P>(2) If the agreement does not specify any reduction in charges or otherwise fails to give recognition to the Government's rights in the patents or data involved, approval shall be conditioned upon amendment of the agreement to reflect a reduction, evaluated by the Department concerned as acceptable to the Government, in any charge thereunder with respect to purchases made by or for the Government or by others with funds derived through the Military Assistance Program or otherwise through the Government, in accordance with § 124.10 of the International Traffic in Arms Regulations.</P>
                            <P>(3) If the agreement provides that no charge is to be made to the second source for data or patent rights to the extent of the Government's rights, the Department concerned shall evaluate the acceptability of the provision before indicating its approval.</P>
                            <P>(4) If time or circumstances do not permit the evaluation called for in (b) (1), (2), or (3) of this subsection, the guidance in (c) of this subsection shall be followed.</P>
                            <P>(c) When it is not reasonably anticipated that the Government will purchase from the second source the supplies or services involved in the agreement nor that Military Assistance Program funds will be provided for the purchase of the supplies or services, then the following guidance applies.</P>
                            <P>(1) If the agreement provides for charges to the second source for data or patent rights, it may suffice to fulfill the requirements of § 124.10 insofar as the Department of Defense is concerned if:</P>
                            <P>(i) The agreement requires the second source to advise the primary source when he has knowledge of any purchase made or to be made from him by or for the Government or by others with funds derived through the Military Assistance Program or otherwise through the Government;</P>
                            <P>(ii) The primary source separately agrees with the Government that upon such advice to him from the second source or from the Government or otherwise as to any such a purchase or prospective purchase, he will negotiate with the Department concerned an appropriate reduction in his charges to the second source in recognition of any Government rights in patents or data; and</P>
                            <P>(iii) The agreement between the primary and second sources further provides that in the event of any such purchase and resulting reduction in charges, the second source shall pass on this reduction to the Government by giving the Government a corresponding reduction in the purchase price of the article or service.</P>
                            <P>
                                (2) If the agreement provides that no charge is to be made to the second source for data or patent rights to the 
                                <PRTPAGE P="262"/>
                                extent to which the Government has rights, the Department concerned shall:
                            </P>
                            <P>(i) Evaluate the acceptability of the provision before indicating its approval; or</P>
                            <P>(ii) Explicitly condition its approval on the right to evaluate the acceptability of the provision at a later time.</P>
                            <P>(d) When there is a technical assistance agreement between the primary source and the Government related to the agreement between the primary and second sources that is under review, the latter agreement shall reflect the arrangements contemplated with respect thereto by the Government's technical assistance agreement with the primary source.</P>
                            <P>(e) Every agreement shall provide that any license rights transferred under the agreement are subject to existing rights of the Government.</P>
                            <P>(f) In connection with every agreement referred to in (b) of this section, a request shall be made to the primary source—</P>
                            <P>(1) To identify the patents, data, and other technical assistance to be provided to the second source by the primary source or any of his subcontractors,</P>
                            <P>(2) To identify any such patents and data in which, to the knowledge of the primary source, the Government may have rights, and</P>
                            <P>(3) To segregate the charges made to the second source for each such category or item of patents, data, and other technical assistance.</P>
                            <FP>Reviewing personnel shall verify this information or, where the primary source does not furnish it, obtain such information from Governmental sources so far as practicable.</FP>
                            <P>(g) The Department concerned shall make it clear that its approval of any agreement does not necessarily recognize the propriety of the charges or the amounts thereof, or constitute approval of any of the business arrangements in the agreement, unless the Department expressly intends by its approval to commit itself to the fairness and reasonableness of a particular charge or charges. In any event, a disclaimer should be made to charges or business terms not affecting any purchase made by or for the Government or by others with funds derived through the Military Assistance Program or otherwise through the Government.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.676</SECTNO>
                            <SUBJECT>Foreign patent interchange agreements.</SUBJECT>
                            <P>(a) Patent interchange agreements between the United States and foreign governments provide for the use of patent rights, compensation, free licenses, and the establishment of committees to review and make recommendations on these matters. The agreements also may exempt the United States from royalty and other payments. The contracting officer shall ensure that royalty payments are consistent with patent interchange agreements.</P>
                            <P>(b) Assistance with patent rights and royalty payments in the United States European Command (USEUCOM) area of responsibility is available from HQ USEUCOM, ATTN: ECLA, Unit 30400, Box 1000, APO AE 09128; Telephone: DSN 430-8001/7263, Commercial 49-0711-680-8001/7263; Telefax: 49-0711-680-5732.</P>
                            <CITA>[62 FR 34125, June 24, 1997, as amended at 63 FR 11534, Mar. 9, 1998]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 227.70—Infringement Claims, Licenses, and Assignments</HD>
                        <SECTION>
                            <SECTNO>227.7000</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>This subpart prescribes policy, procedures, and instructions for use of clauses with respect to processing licenses, assignments, and infringement claims.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7001</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>Whenever a claim of infringement of privately owned rights in patented inventions or copyrighted works is asserted against any Department or Agency of the Department of Defense, all necessary steps shall be taken to investigate, and to settle administratively, deny, or otherwise dispose of such claim prior to suit against the United States. This subpart 227.70 does not apply to licenses or assignments acquired by the Department of Defense under the Patent Rights clauses.</P>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="263"/>
                            <SECTNO>227.7002</SECTNO>
                            <SUBJECT>Statutes pertaining to administrative claims of infringement.</SUBJECT>
                            <P>Statutes pertaining to administrative claims of infringement in the Department of Defense include the following: the Foreign Assistance Act of 1961, 22 U.S.C. 2356 (formerly the Mutual Security Acts of 1951 and 1954); the Invention Secrecy Act, 35 U.S.C. 181-188; 10 U.S.C. 3793; 28 U.S.C. 1498; and 35 U.S.C. 286.</P>
                            <CITA>[56 FR 36367, July 31, 1991, as amended at 87 FR 76994, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7003</SECTNO>
                            <SUBJECT>Claims for copyright infringement.</SUBJECT>
                            <P>The procedures set forth herein will be followed, where applicable, in copyright infringement claims.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7004</SECTNO>
                            <SUBJECT>Requirements for filing an administrative claim for patent infringement.</SUBJECT>
                            <P>(a) A patent infringement claim for compensation, asserted against the United States under any of the applicable statutes cited in 227.7002, must be actually communicated to and received by a Department, agency, organization, office, or field establishment within the Department of Defense. Claims must be in writing and should include the following:</P>
                            <P>(1) An allegation of infringement;</P>
                            <P>(2) A request for compensation, either expressed or implied;</P>
                            <P>(3) A citation of the patent or patents alleged to be infringed;</P>
                            <P>(4) A sufficient designation of the alleged infringing item or process to permit identification, giving the military or commercial designation, if known, to the claimant;</P>
                            <P>(5) A designation of at least one claim of each patent alleged to be infringed; or</P>
                            <P>(6) As an alternative to (a) (4) and (5) of this section, a declaration that the claimant has made a bona fide attempt to determine the item or process which is alleged to infringe, but was unable to do so, giving reasons, and stating a reasonable basis for his belief that his patent or patents are being infringed.</P>
                            <P>(b) In addition to the information listed in (a) of this section, the following material and information is generally necessary in the course of processing a claim of patent infringement. Claimants are encouraged to furnish this information at the time of filing a claim to permit the most expeditious processing and settlement of the claim.</P>
                            <P>(1) A copy of the asserted patent(s) and identification of all claims of the patent alleged to be infringed.</P>
                            <P>(2) Identification of all procurements known to claimant which involve the alleged infringing item or process, including the identity of the vendor or contractor and the Government procuring activity.</P>
                            <P>(3) A detailed identification of the accused article or process, particularly where the article or process relates to a component or subcomponent of the item procured, an element by element comparison of the representative claims with the accused article or process. If available, this identification should include documentation and drawings to illustrate the accused article or process in suitable detail to enable verification of the infringement comparison.</P>
                            <P>(4) Names and addresses of all past and present licenses under the patent(s), and copies of all license agreements and releases involving the patent(s).</P>
                            <P>(5) A brief description of all litigation in which the patent(s) has been or is now involved, and the present status thereof.</P>
                            <P>(6) A list of all persons to whom notices of infringement have been sent, including all departments and agencies of the Government, and a statement of the ultimate disposition of each.</P>
                            <P>(7) A description of Government employment or military service, if any, by the inventor and/or patent owner.</P>
                            <P>(8) A list of all Government contracts under which the inventor, patent owner, or anyone in privity with him performed work relating to the patented subject matter.</P>
                            <P>(9) Evidence of title to the patent(s) alleged to be infringed or other right to make the claim.</P>
                            <P>(10) A copy of the Patent Office file of each patent if available to claimant.</P>
                            <P>
                                (11) Pertinent prior art known to claimant, not contained in the Patent Office file, particularly publications and foreign art.
                                <PRTPAGE P="264"/>
                            </P>
                            <FP>In addition in the foregoing, if claimant can provide a statement that the investigation may be limited to the specifically identified accused articles or processes, or to a specific procurement, it may materially expedite determination of the claim.</FP>
                            <P>(c) Any department receiving an allegation of patent infringement which meets the requirements of this paragraph shall acknowledge the same and supply the other departments that may have an interest therein with a copy of such communication and the acknowledgement thereof.</P>
                            <P>(1) For the Department of the Army—Chief, Patents, Copyrights, and Trademarks Division, U.S. Army Legal Services Agency;</P>
                            <P>(2) For the Department of the Navy—the Patent Counsel for Navy, Office of Naval Research;</P>
                            <P>(3) For the Department of the Air Force—Chief, Patents Division, Office of the Judge Advocate General;</P>
                            <P>(4) For the Defense Logistics Agency—the Office of Counsel;</P>
                            <P>(5) For the National Security Agency—the General Counsel;</P>
                            <P>(6) For the Defense Information Systems Agency—the Counsel;</P>
                            <P>(7) For the Defense Threat Reduction Agency—the General Counsel; and</P>
                            <P>(8) For the National Geospatial-Intelligence Agency—the Counsel.</P>
                            <P>(d) If a communication alleging patent infringement is received which does not meet the requirements set forth in paragraph (c) of this section, the sender shall be advised in writing—</P>
                            <P>(1) That his claim for infringement has not been satisfactorily presented, and</P>
                            <P>(2) Of the elements considered necessary to establish a claim.</P>
                            <P>(e) A communication making a proffer of a license in which no infringement is alleged shall not be considered as a claim for infringement.</P>
                            <CITA>[56 FR 36389, July 31, 1991, as amended at 56 FR 67216, Dec. 30, 1991; 61 FR 50454, Sept. 26, 1996; 62 FR 2613, Jan. 17, 1997; 64 FR 51076, Sept. 21, 1999; 74 FR 42780, Aug. 25, 2009; 76 FR 3536, Jan. 20, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7005</SECTNO>
                            <SUBJECT>Indirect notice of patent infringement claims.</SUBJECT>
                            <P>(a) A communication by a patent owner to a Department of Defense contractor alleging that the contractor has committed acts of infringement in performance of a Government contract shall not be considered a claim within the meaning of 227.7004 until it meets the requirements specified therein.</P>
                            <P>(b) Any Department receiving an allegation of patent infringement which meets the requirements of 227.7004 shall acknowledge the same and supply the other Departments (see 227.7004(c)) which may have an interest therein with a copy of such communication and the acknowledgement thereof.</P>
                            <P>(c) If a communication covering an infringement claim or notice which does not meet the requirements of 227.7004(a) is received from a contractor, the patent owner shall be advised in writing as covered by the instructions of 227.7004(d).</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7006</SECTNO>
                            <SUBJECT>Investigation and administrative disposition of claims.</SUBJECT>
                            <P>An investigation and administrative determination (denial or settlement) of each claim shall be made in accordance with instructions and procedures established by each Department, subject to the following:</P>
                            <P>(a) When the procurement responsibility for the alleged infringing item or process is assigned to a single Department or only one Department is the purchaser of the alleged infringing item or process, and the funds of that Department only are to be charged in the settlement of the claim, that Department shall have the sole responsibility for the investigation and administrative determination of the claim and for the execution of any agreement in settlement of the claim. Where, however, funds of another Department are to be charged, in whole or in part, the approval of such Department shall be obtained as required by 208.7002. Any agreement in settlement of the claim, approved pursuant to 208.7002 shall be executed by each of the Departments concerned.</P>
                            <P>
                                (b) When two or more Departments are the respective purchasers of alleged infringing items or processes and the funds of those Departments are to be charged in the settlement of the claim, the investigation and administrative determination shall be the responsibility of the Department having the 
                                <PRTPAGE P="265"/>
                                predominant financial interest in the claim or of the Department or Departments as jointly agreed upon by the Departments concerned. The Department responsible for negotiation shall, throughout the negotiation, coordinate with the other Departments concerned and keep them advised of the status of the negotiation. Any agreement in the settlement of the claim shall be executed by each Department concerned.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7007</SECTNO>
                            <SUBJECT>Notification and disclosure to claimants.</SUBJECT>
                            <P>When a claim is denied, the Department responsible for the administrative determination of the claim shall so notify the claimant or his authorized representative and provide the claimant a reasonable rationale of the basis for denying the claim. Disclosure of information or the rationale referred to above shall be subject to applicable statutes, regulations, and directives pertaining to security, access to official records, and the rights of others.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7008</SECTNO>
                            <SUBJECT>Settlement of indemnified claims.</SUBJECT>
                            <P>Settlement of claims involving payment for past infringement shall not be made without the consent of, and equitable contribution by, each indemnifying contractor involved, unless such settlement is determined to be in the best interests of the Government and is coordinated with the Department of Justice with a view to preserving any rights of the Government against the contractors involved. If consent of and equitable contribution by the contractors are obtained, the settlement need not be coordinated with the Department of Justice.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7009</SECTNO>
                            <SUBJECT>Patent releases, license agreements, and assignments.</SUBJECT>
                            <P>This section contains clauses for use in patent release and settlement agreements, license agreements, and assignments, executed by the Government, under which the Government acquires rights. Minor modifications of language (e.g., pluralization of “Secretary” or “Contracting Officer”) in multi-departmental agreements may be made if necessary.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7009-1</SECTNO>
                            <SUBJECT>Required clauses.</SUBJECT>
                            <P>(a) Covenant Against Contingent Fees. Insert the clause at FAR 52.203-5.</P>
                            <P>(b) Gratuities. Insert the clause at FAR 52.203-3.</P>
                            <P>(c) Assignment of Claims. Insert the clause at FAR 52.232-23.</P>
                            <P>(d) Disputes. Pursuant to FAR 33.014, insert the clause at FAR 52.233-1.</P>
                            <P>(e) Non-Estoppel. Insert the clause at 252.227-7000.</P>
                            <CITA>[56 FR 36389, July 31, 1991, as amended at 61 FR 50454, Sept. 26, 1996]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7009-2</SECTNO>
                            <SUBJECT>Clauses to be used when applicable.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Release of past infringement.</E>
                                 The clause at 252.227-7001, Release of Past Infringement, is an example which may be modified or omitted as appropriate for particular circumstances, but only upon the advice of cognizant patent or legal counsel. (See footnotes at end of clause.)
                            </P>
                            <P>
                                (b) 
                                <E T="03">Readjustment of payments.</E>
                                 The clause at 252.227-7002, Readjustment of Payments, shall be inserted in contracts providing for payment of a running royalty.
                            </P>
                            <P>
                                (c) 
                                <E T="03">Termination.</E>
                                 The clause at 252.227-7003, Termination, is an example for use in contracts providing for the payment of a running royalty. This clause may be modified or omitted as appropriate for particular circumstances, but only upon the advice of cognizant patent or legal counsel (see 227.7004(c)).
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7009-3</SECTNO>
                            <SUBJECT>Additional clauses—contracts except running royalty contracts.</SUBJECT>
                            <P>The following clauses are examples for use in patent release and settlement agreements, and license agreements not providing for payment by the Government of a running royalty.</P>
                            <P>(a) License Grant. Insert the clause at 252.227-7004.</P>
                            <P>(b) License Term. Insert one of the clauses at 252.227-7005 Alternate I or Alternate II, as appropriate.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7009-4</SECTNO>
                            <SUBJECT>Additional clauses—contracts providing for payment of a running royalty.</SUBJECT>
                            <P>
                                The clauses set forth below are examples which may be used in patent release and settlement agreements, and license agreements, when it is desired 
                                <PRTPAGE P="266"/>
                                to cover the subject matter thereof and the contract provides for payment of a running royalty.
                            </P>
                            <P>
                                (a) 
                                <E T="03">License grant—running royalty.</E>
                                 No Department shall be obligated to pay royalties unless the contract is signed on behalf of such Department. Accordingly, the License Grant clause at 252.227-7006 should be limited to the practice of the invention by or for the signatory Department or Departments.
                            </P>
                            <P>
                                (b) 
                                <E T="03">License term—running royalty.</E>
                                 The clause at 252.227-7007 is a sample form for expressing the license term.
                            </P>
                            <P>
                                (c) 
                                <E T="03">Computation of royalties.</E>
                                 The clause at 252.227-7008 providing for the computation of royalties, may be of varying scope depending upon the nature of the royalty bearing article, the volume of procurement, and the type of contract pursuant to which the procurement is to be accomplished.
                            </P>
                            <P>
                                (d) 
                                <E T="03">Reporting and payment of royalties.</E>
                                 (1) The contract should contain a provision specifying the office designated within the specific Department involved to make any necessary reports to the contractor of the extent of use of the licensed subject matter by the entire Department, and such office shall be charged with the responsibility of obtaining from all procuring offices of that Department the information necessary to make the required reports and corresponding vouchers necessary to make the required payments. The clause at 252.227-7009 is a sample for expressing reporting and payment of royalties requirements.
                            </P>
                            <P>(2) Where more than one Department or Government Agency is licensed and there is a ceiling on the royalties payable in any reporting period, the licensing Departments or Agencies shall coordinate with respect to the pro rata share of royalties to be paid by each.</P>
                            <P>
                                (e) 
                                <E T="03">License to other government agencies.</E>
                                 When it is intended that a license on the same terms and conditions be available to other departments and agencies of the Government, the clause at 252.227-7010 is an example which may be used.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7010</SECTNO>
                            <SUBJECT>Assignments.</SUBJECT>
                            <P>(a) The clause at 252.227-7011 is an example which may be used in contracts of assignment of patent rights to the Government.</P>
                            <P>(b) To facilitate proof of contracts of assignments, the acknowledgement of the contractor should be executed before a notary public or other officer authorized to administer oaths (35 U.S.C. 261).</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7011</SECTNO>
                            <SUBJECT>Procurement of rights in inventions, patents, and copyrights.</SUBJECT>
                            <P>Even though no infringement has occurred or been alleged, it is the policy of the Department of Defense to procure rights under patents, patent applications, and copyrights whenever it is in the Government's interest to do so and the desired rights can be obtained at a fair price. The required and suggested clauses at 252.227-7004 and 252.227-7010 shall be required and suggested clauses, respectively, for license agreements and assignments made under this paragraph. The instructions at 227.7009-3 and 227.7010 concerning the applicability and use of those clauses shall be followed insofar as they are pertinent.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7012</SECTNO>
                            <SUBJECT>Contract format.</SUBJECT>
                            <P>The format at 252.227-7012 appropriately modified where necessary, may be used for contracts of release, license, or assignment.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7013</SECTNO>
                            <SUBJECT>Recordation.</SUBJECT>
                            <P>Executive Order No. 9424 of 18 February 1944 requires all executive Departments and agencies of the Government to forward through appropriate channels to the Commissioner of Patents and Trademarks, for recording, all Government interests in patents or applications for patents.</P>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 227.71—Technical Data and Associated Rights</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>60 FR 33471, June 28, 1995, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>227.7100</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>This subpart—</P>
                            <P>(a) Prescribes policies and procedures for the acquisition of technical data and the rights to use, modify, reproduce, release, perform, display, or disclose technical data. It implements the following laws and Executive Order:</P>
                            <P>
                                (1) 10 U.S.C. 3013.
                                <PRTPAGE P="267"/>
                            </P>
                            <P>(2) 10 U.S.C. 3208(d).</P>
                            <P>(3) 10 U.S.C. 3771-3775.</P>
                            <P>(4) 10 U.S.C. 3781-3786.</P>
                            <P>(5) 10 U.S.C. 8687.</P>
                            <P>
                                (6) 17 U.S.C. 1301, 
                                <E T="03">et seq.</E>
                            </P>
                            <P>(7) Public Law 103-355.</P>
                            <P>(8) Executive Order 12591 (subsection 1(b)(7)).</P>
                            <P>(b) Does not apply to—</P>
                            <P>(1) Computer software or technical data that is computer software documentation (see subpart 227.72); or</P>
                            <P>(2) Releases of technical data to litigation support contractors (see subpart 204.74).</P>
                            <CITA>[60 FR 33471, June 28, 1995, as amended at 74 FR 61044, Nov. 23, 2009; 79 FR 11340, Feb. 28, 2014; 87 FR 76994, Dec. 16, 2022; 88 FR 17343, Mar. 22, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7101</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>(a) As used in this subpart, unless otherwise specifically indicated, the terms “offeror” and “contractor” include an offeror's or contractor's subcontractors, suppliers, or potential subcontractors or suppliers at any tier.</P>
                            <P>(b) Other terms used in this subpart are defined in the clause at 252.227-7013, Rights in Technical Data—Other Than Commercial Products and Commercial Services.</P>
                            <CITA>[56 FR 36389, July 31, 1991, as amended at 60 FR 61598, Nov. 30, 1995; 88 FR 6584, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7102</SECTNO>
                            <SUBJECT>Commercial products, commercial components, commercial services, or commercial processes.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7102-1</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(a) DoD shall acquire only the technical data customarily provided to the public with a commercial product, commercial service, or commercial process, except technical data that—</P>
                            <P>(1) Are form, fit, or function data;</P>
                            <P>(2) Are required for repair or maintenance of commercial products or commercial processes, or for the proper installation, operating, or handling of a commercial product, either as a stand alone unit or as a part of a military system, when such data are not customarily provided to commercial users or the data provided to commercial users is not sufficient for military purposes; or</P>
                            <P>(3) Describe the modifications made at Government expense to a commercial product, commercial service, or commercial process in order to meet the requirements of a Government solicitation.</P>
                            <P>(b) To encourage offerors and contractors to offer or use commercial products to satisfy military requirements, offerors, and contractors shall not be required, except for the technical data described in paragraph (a) of this section, to—</P>
                            <P>(1) Furnish technical information related to commercial products, commercial services, or commercial processes that is not customarily provided to the public; or</P>
                            <P>(2) Relinquish to, or otherwise provide, the Government rights to use, modify, reproduce, release, perform, display, or disclose technical data pertaining to commercial products, commercial services, or commercial processes except for a transfer of rights mutually agreed upon.</P>
                            <P>(c) The Government's rights in a vessel design, and in any useful article embodying a vessel design, must be consistent with the Government's rights in technical data pertaining to the design (10 U.S.C. 8687; 17 U.S.C. 1301(a)(3)).</P>
                            <CITA>[60 FR 33471, June 28, 1995, as amended at 74 FR 61044, Nov. 23, 2009; 87 FR 15818, Mar. 18, 2022; 88 FR 6585, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7102-2</SECTNO>
                            <SUBJECT>Rights in technical data.</SUBJECT>
                            <P>
                                (a) The clause at 252.227-7015, Technical Data—Commercial Products and Commercial Services, provides the Government specific license rights in technical data pertaining to commercial products, commercial services, or commercial processes. DoD may use, modify, reproduce, release, perform, display, or disclose data only within the Government. The data may not be used to manufacture additional quantities of the commercial products and, except for emergency repair or overhaul and for covered Government support contractors, may not be released or disclosed to, or used by, third parties without the contractor's written permission. Those restrictions do not apply to the technical data described in 227.7102-1(a).
                                <PRTPAGE P="268"/>
                            </P>
                            <P>(b) If additional rights are needed, contracting activities must negotiate with the contractor to determine if there are acceptable terms for transferring such rights. The specific additional rights granted to the Government shall be enumerated in a license agreement made part of the contract.</P>
                            <CITA>[56 FR 36389, July 31, 1991, as amended at 76 FR 11367, Mar. 2, 2011; 88 FR 6585, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7102-3</SECTNO>
                            <SUBJECT>Government right to review, verify, challenge, and validate asserted restrictions.</SUBJECT>
                            <P>Follow the procedures at 227.7103-13 and the clause at 252.227-7037, Validation of Restrictive Markings on Technical Data, regarding the validation of asserted restrictions on technical data related to commercial products or commercial services.</P>
                            <CITA>[76 FR 58147, Sept. 20, 2011, as amended at 88 FR 6585, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7102-4</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>(a)(1) Except as provided in paragraph (b) of this section, use the clause at 252.227-7015, Technical Data—Commercial Products and Commercial Services, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, when the contractor will be required to deliver technical data pertaining to commercial products, commercial components, commercial services, or commercial processes.</P>
                            <P>(2) Use the clause at 252.227-7015 with its Alternate I in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, for the development or delivery of a vessel design or any useful article embodying a vessel design.</P>
                            <P>(b) In accordance with the clause prescription at 227.7103-6(a), use the clause at 252.227-7013, Rights in Technical Data- Other Than Commercial Products and Commercial Services, in addition to the clause at 252.227-7015, if the Government will have paid for any portion of the development costs of a commercial item. The clause at 252.227-7013 will govern the technical data pertaining to any portion of a commercial product or commercial service that was developed in any part at Government expense, and the clause at 252.227-7015 will govern the technical data pertaining to any portion of a commercial item that was developed exclusively at private expense.</P>
                            <P>(c) Use the clause at 252.227-7037, Validation of Restrictive Markings on Technical Data, in solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services that include the clause at 252.227-7015 or the clause at 252.227-7013.</P>
                            <CITA>[76 FR 58147, Sept. 20, 2011, as amended at 78 FR 37988, June 25, 2013; 88 FR 6586, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7103</SECTNO>
                            <SUBJECT>Other than commercial products, commercial services, or commercial processes.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7103-1</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(a) DoD policy is to acquire only the technical data, and the rights in that data, necessary to satisfy agency needs.</P>
                            <P>(b) Solicitations and contracts shall—</P>
                            <P>(1) Specify the technical data to be delivered under a contract and delivery schedules for the data;</P>
                            <P>(2) Establish or reference procedures for determining the acceptability of technical data;</P>
                            <P>(3) Establish separate contract line items, to the extent practicable, for the technical data to be delivered under a contract and require offerors and contractors to price separately each deliverable data item; and</P>
                            <P>(4) Require offerors to identify, to the extent practicable, technical data to be furnished with restrictions on the Government's rights and require contractors to identify technical data to be delivered with such restrictions prior to delivery.</P>
                            <P>
                                (c) Offerors shall not be required, either as a condition of being responsive to a solicitation or as a condition for award, to sell or otherwise relinquish to the Government any rights in technical data related to items, components or processes developed at private expense except for the data identified at 227.7103-5(a)(2) and (a)(4) through (9).
                                <PRTPAGE P="269"/>
                            </P>
                            <P>(d) Offerors and contractors shall not be prohibited or discouraged from furnishing or offering to furnish items, components, or processes developed at private expense solely because the Government's rights to use, modify, release, reproduce, perform, display, or disclose technical data pertaining to those items may be restricted.</P>
                            <P>(e) As provided in 10 U.S.C. 3208, solicitations for major systems development contracts shall not require offerors to submit proposals that would permit the Government to acquire competitively items identical to items developed at private expense unless a determination is made at a level above the contracting officer that—</P>
                            <P>(1) The offeror will not be able to satisfy program schedule or delivery requirements; or</P>
                            <P>(2) The offeror's proposal to meet mobilization requirements does not satisfy mobilization needs.</P>
                            <P>(f) For acquisitions involving major weapon systems or subsystems of major weapon systems, the acquisition plan shall address acquisition strategies that provide for technical data and the associated license rights in accordance with 207.106(S-70).</P>
                            <P>(g) The Government's rights in a vessel design, and in any useful article embodying a vessel design, must be consistent with the Government's rights in technical data pertaining to the design (10 U.S.C. 8687; 17 U.S.C. 1301(a)(3)).</P>
                            <CITA>[60 FR 33471, June 28, 1995, as amended at 72 FR 51189, Sept. 6, 2007; 74 FR 61044, Nov. 23, 2009; 87 FR 15818, Mar. 18, 2022; 87 FR 76994, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7103-2</SECTNO>
                            <SUBJECT>Acquisition of technical data.</SUBJECT>
                            <P>(a) Contracting officers shall work closely with data managers and requirements personnel to assure that data requirements included in solicitations are consistent with the policy expressed in 227.7103-1.</P>
                            <P>(b)(1) Data managers or other requirements personnel are responsible for identifying the Government's life-cycle needs for technical data. Technical data needs must be established giving consideration to the offeror's economic interests in technical data pertaining to items, components, or processes that have been developed at private expense (including the economic interests of small businesses and nontraditional contractors); the Government's costs to acquire, maintain, store, retrieve, and protect the technical data; reprocurement needs; repair, maintenance, and overhaul philosophies; spare and repair part considerations; and whether procurement of the items, components, or processes can be accomplished on a form, fit, or function basis. When it is anticipated that the Government will obtain unlimited or government purpose rights in technical data that will be required for competitive spare or repair parts procurements, such data should be identified as deliverable technical data items. Reprocurement needs may not be a sufficient reason to acquire detailed manufacturing or process data when items or components can be acquired using performance specifications, form, fit, and function data, or when there are a sufficient number of alternate sources that can reasonably be expected to provide such items on a performance specification or form, fit, or function basis.</P>
                            <P>(2) When reviewing offers received in response to a solicitation or other request for data, data managers must balance the original assessment of the Government's data needs with data prices contained in the offer.</P>
                            <P>(c) Contracting officers are responsible for ensuring that, wherever practicable, solicitations and contracts—</P>
                            <P>(1) Identify the type and quantity of the technical data to be delivered under the contract and the format and media in which the data will be delivered;</P>
                            <P>(2) Establish each deliverable data item as a separate contract line item (this requirement may be satisfied by listing each deliverable data item on an exhibit to the contract);</P>
                            <P>(3) Identify the prices established for each deliverable data item under a fixed-price type contract;</P>
                            <P>
                                (4) Include delivery schedules and acceptance criteria for each deliverable data item; and
                                <PRTPAGE P="270"/>
                            </P>
                            <P>(5) Specifically identify the place of delivery for each deliverable item of technical data.</P>
                            <CITA>[60 FR 33471, June 28, 1995, as amended at 88 FR 17343, Mar. 22, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7103-3</SECTNO>
                            <SUBJECT>Early identification of technical data to be furnished to the Government with restrictions on use, reproduction, or disclosure.</SUBJECT>
                            <P>(a) 10 U.S.C. 3772(a) requires, to the maximum extent practicable, an identification prior to delivery of any technical data to be delivered to the Government with restrictions on use.</P>
                            <P>(b) Use the provision at 252.227-7017, Identification and Assertion of Use, Release, or Disclosure Restrictions, in all solicitations that include the clause at 252.227-7013, Rights in Technical Data—Other Than Commercial Products and Commercial Services. The provision requires offerors to identify any technical data for which restrictions, other than copyright, on use, release, or disclosure are asserted and to attach the identification and assertions to the offer.</P>
                            <P>(c) Subsequent to contract award, the clause at 252.227-7013 permits a contractor, under certain conditions, to make additional assertions of use, release, or disclosure restrictions. The prescription for the use of that clause and its alternate is at 227.7103-6 (a) and (b).</P>
                            <CITA>[60 FR 33471, June 28, 1995, as amended at 78 FR 13544, Feb. 28, 2013; 87 FR 76994, Dec. 16, 2022; 88 FR 6585, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7103-4</SECTNO>
                            <SUBJECT>License rights.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Grant of license.</E>
                                 The Government obtains rights in technical data, including a copyright license, under and irrevocable license granted or obtained for the Government by the contractor. The contractor or licensor retains all rights in the data not granted to the Government. For technical data that pertain to items, components, or processes, the scope of the license is generally determined by the source of funds used to develop the item, component, or process. When the technical data do not pertain to items, components, or processes, the scope of the license is determined by the source of funds used to create the data.
                            </P>
                            <P>
                                (1) 
                                <E T="03">Techical data pertaining to items, components, or processes.</E>
                                 Contractors or licensors may, with some exceptions (see 227.7103-5(a)(2) and (a)(4) through (9)), restrict the Government's rights to use, modify, release, reproduce, perform, display or disclose technical data pertaining to items, components, or processes developed exclusively at private expense (limited rights). They may not restrict the Government's rights in items, components, or processes developed exclusively at Government expense (unlimited rights) without the Government's approval. When an item, component, or process is developed with mixed funding, the Government may use, modify, release, reproduce, perform, display or disclose the data pertaining to such items, components, or processes within the Government without restriction but may release or disclose the data outside the Government only for government purposes (government purpose rights).
                            </P>
                            <P>
                                (2) 
                                <E T="03">Technical data that do not pertain to items, components, or processes.</E>
                                 Technical data may be created during the performance of a contract for a conceptual design or similar effort that does not require the development, manufacture, construction, or production of items, components or processes. The Government generally obtains unlimited rights in such data when the data were created exclusively with Government funds, government purpose rights when the data were created with mixed funding, and limited rights when the data were created exclusively at private expense.
                            </P>
                            <P>
                                (b) 
                                <E T="03">Source of funds determination.</E>
                                 The determination of the source of development funds for technical data pertaining to items, components, or processes should be made at any practical sub-item or subcomponent level or for any segregable portion of a process. Contractors may assert limited rights in a segregable sub-item, sub-component, or portion of a process which otherwise qualifies for limited rights under the clause at 252.227-7013, Rights in Technical Data—Noncommercial Items.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7103-5</SECTNO>
                            <SUBJECT>Government rights.</SUBJECT>
                            <P>
                                The standard license rights that a licensor grants to the Government are 
                                <PRTPAGE P="271"/>
                                unlimited rights, government purpose rights, or limited rights. Those rights are defined in the clause at 252.227-7013, Rights in Technical Data—Other Than Commercial Products and Commercial Services. In unusual situations, the standards rights may not satisfy the Government's needs or the Government may be willing to accept lesser rights in data in return for other consideration. In those cases, a special license may be negotiated. However, the licensor is not obligated to provide the Government greater rights and the contracting officer is not required to accept lesser rights than the rights provided in the standard grant of license. The situations under which a particular grant of license applies are enumerated in paragraphs (a) through (d) of this section.
                            </P>
                            <P>
                                (a) 
                                <E T="03">Unlimited rights.</E>
                                 The Government obtains unlimited rights in technical data that are—
                            </P>
                            <P>(1) Data pertaining to an item, component, or process which has been or will be developed exclusively with Government funds;</P>
                            <P>(2) Studies, analyses, test data, or similar data produced in the performance of a contract when the study, analysis, test, or similar work was specified as an element of performance;</P>
                            <P>(3) Created exclusively with Government funds in the performance of a contract that does not require the development, manufacture, construction, or production of items, components, or processes;</P>
                            <P>(4) Form, fit, and function data;</P>
                            <P>(5) Necessary for installation, operation, maintenance, or training purposes (other than detailed manufacturing or process data);</P>
                            <P>(6) Corrections or changes to technical data furnished to the contractor by the Government;</P>
                            <P>(7) Publicly available or have been released or disclosed by the contractor or subcontractor without restrictions on further use, release or disclosure other than a release or disclosure resulting from the sale, transfer, or other assignment of interest in the software to another party or the sale or transfer of some or all of a business entity or its assets to another party;</P>
                            <P>(8) Data in which the Government has obtained unlimited rights under another Government contract or as a result of negotiations; or</P>
                            <P>(9) Data furnished to the Government, under a Government contract or subcontract thereunder, with—</P>
                            <P>(i) Government purpose license rights or limited rights and the restrictive condition(s) has/have expired; or</P>
                            <P>(ii) Government purpose rights and the contractor's exclusive right to use such data for commercial purposes has expired.</P>
                            <P>
                                (b) 
                                <E T="03">Government purpose rights.</E>
                                 (1) The Government obtains government purpose rights in technical data—
                            </P>
                            <P>(i) That pertain to items, components, or processes developed with mixed funding except when the Government is entitled to unlimited rights as provided in paragraphs (a)(2) and (a)(4) through (9) of this subsection; or</P>
                            <P>(ii) Created with mixed funding in the performance of a contract that does not require the development, manufacture, construction, or production of items, components, or processes.</P>
                            <P>(2) The period during which government purpose rights are effective is negotiable. The clause at 252.227-7013 provides a nominal five-year period. Either party may request a different period. Changes to the government purpose rights period may be made at any time prior to delivery of the technical data without consideration from either party. Longer periods should be negotiated when a five-year period does not provide sufficient time to apply the data for commercial purposes or when necessary to recognize subcontractors' interests in the data.</P>
                            <P>(3) The government purpose rights period commences upon execution of the contract, subcontract, letter contract (or similar contractual instrument), contract modification, or option exercise that required the development. Upon expiration of the Government rights period, the Government has unlimited rights in the data including the right to authorize others to use the data for commercial purposes.</P>
                            <P>
                                (4) During the government purpose rights period, the government may not use, or authorize other persons to use, technical data marked with government purpose rights legends for commercial purposes. The Government shall not release or disclose data in 
                                <PRTPAGE P="272"/>
                                which it has government purpose rights to any person, or authorize others to do so, unless—
                            </P>
                            <P>(i) Prior to release or disclosure, the intended recipient is subject to the use and non-disclosure agreement at 227.7103-7; or</P>
                            <P>(ii) The intended recipient is a Government contractor receiving access to the data for performance of a Government contract that contains the clause at 252.227-7025, Limitations on the Use or Disclosure of Government-Furnished Information Marked with Restrictive Legends.</P>
                            <P>(5) When technical data marked with government purpose rights legends will be released or disclosed to a Government contractor performing a contract that does not include the clause at 252-227-7025, the contract may be modified, prior to release or disclosure, to include that clause in lieu of requiring the contractor to complete a use and non-disclosure agreement.</P>
                            <P>(6) Contracting activities shall establish procedures to assure that technical data marked with government purpose rights legends are released or disclosed, including a release or disclosure through a Government solicitation, only to persons subject to the use and non-disclosure restrictions. Public announcements in the Commerce Business Daily or other publications must provide notice of the use and non-disclosure requirements. Class use and non-disclosure agreements (e.g., agreements covering all solicitations received by the XYZ company within a reasonable period) are authorized and may be obtained at any time prior to release or disclosure of the government purpose rights data. Documents transmitting government purpose rights data to persons under class agreements shall identify the technical data subject to government purpose rights and the class agreement under which such data are provided.</P>
                            <P>
                                (c) 
                                <E T="03">Limited rights.</E>
                                 (1) The Government obtains limited rights in technical data—
                            </P>
                            <P>(i) That pertain to items, components, or processes developed exclusively at private expense except when the Government is entitled to unlimited rights as provided in paragraphs (a)(2) and (a)(4) through (9) of this subsection; or</P>
                            <P>(ii) Created exclusively at private expense in the performance of a contract that does not require the development, manufacture, construction, or production of items, components, or processes.</P>
                            <P>(2) Data in which the Government has limited rights may not be used, released, or disclosed outside the Government without the permission of the contractor asserting the restriction except for a use, release, or disclosure that is—</P>
                            <P>(i) Necessary for emergency repair and overhaul; or</P>
                            <P>(ii) To a covered Government support contractor; or</P>
                            <P>(iii) To a foreign government, other than detailed manufacturing or process data, when use, release, or disclosure is in the interest of the United States and is required for evaluational or informational purposes.</P>
                            <P>(3) The person asserting limited rights must be notified of the Government's intent to release, disclose, or authorize others to use such data prior to release or disclosure of the data except notification of an intended release, disclosure, or use for emergency repair or overhaul which shall be made as soon as practicable.</P>
                            <P>(4) When the person asserting limited rights permits the Government to release, disclose, or have others use the data subject to restrictions on further use, release, or disclosure, or for a release under paragraph (c)(2)(i), (ii), or (iii) of this subsection, the intended recipient must complete the use and non-disclosure agreement at 227.7103-7, or receive the data for performance of a Government contract that contains the clause at 252.227-7025, Limitations on the Use or Disclosure of Government-Furnished Information Marked with Restrictive Legends, prior to release or disclosure of the limited rights data.</P>
                            <P>
                                (d) 
                                <E T="03">Specifically negotiated license rights.</E>
                                 (1) Negotiate specific licenses when the parties agree to modify the standard license rights granted to the government or when the government wants to obtain rights in data in which it does not have rights. When negotiating to obtain, relinquish, or increase the Government's rights in technical 
                                <PRTPAGE P="273"/>
                                data, consider the acquisition strategy for the item, component, or process, including logistics support and other factors which may have relevance for a particular procurement. The Government may accept lesser rights when it has unlimited or government purpose rights in data but may not accept less than limited rights in such data. The negotiated license rights must stipulate what rights the Government has to release or disclose the data to other persons or to authorize others to use the data. Identify all negotiated rights in a license agreement made part of the contract.
                            </P>
                            <P>(2) When the Government needs additional rights in data acquired with government purpose or limited rights, the contracting officer must negotiate with the contractor to determine whether there are acceptable terms for transferring such rights. Generally, such negotiations should be conducted only when there is a need to disclose the data outside the Government or if the additional rights are required for competitive reprocurement and the anticipated savings expected to be obtained through competition are estimated to exceed the acquisition cost of the additional rights. Prior to negotiating for additional rights in limited rights data, consider alternatives such as—</P>
                            <P>(i) Using performance specifications and form, fit, and function data to acquire or develop functionally equivalent items, components, or processes;</P>
                            <P>(ii) Obtaining a contractor's contractual commitment to qualify additional sources and maintain adequate competition among the sources; or</P>
                            <P>(iii) Reverse engineering, or providing items from Government inventories to contractors who request the items to facilitate the development of equivalent items through reverse engineering.</P>
                            <CITA>[56 FR 36389, July 31, 1991, as amended at 76 FR 11367, Mar. 2, 2011; 78 FR 30238, May 22, 2013; 88 FR 6585, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7103-6</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>(a) Use the clause at 252.227-7013, Rights in Technical Data—Other Than Commercial Products and Commercial Services, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, when the successful offeror(s) will be required to deliver to the Government technical data pertaining to other than commercial products or commercial services, or pertaining to commercial products or commercial services for which the Government will have paid for any portion of the development costs (in which case the clause at 252.227-7013 will govern the technical data pertaining to any portion of a commercial product or commercial service that was developed in any part at Government expense, and the clause at 252.227-7015 will govern the technical data pertaining to any portion of a commercial product or commercial service that was developed exclusively at private expense). Do not use the clause when the only deliverable items are computer software or computer software documentation (see 227.72), commercial products or commercial services developed exclusively at private expense (see 227.7102-4), existing works (see 227.7105), special works (see 227.7106), or when contracting under the Small Business Innovation Research Program (see 227.7104). Except as provided in 227.7107-2, do not use the clause in architect-engineer and construction contracts.</P>
                            <P>(b)(1) Use the clause at 252.227-7013 with its Alternate I in research solicitations and contracts, including research solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, when the contracting officer determines, in consultation with counsel, that public dissemination by the contractor would be—</P>
                            <P>(i) In the interest of the government; and</P>
                            <P>(ii) Facilitated by the Government relinquishing its right to publish the work for sale, or to have others publish the work for sale on behalf of the Government.</P>
                            <P>
                                (2) Use the clause at 252.227-7013 with its Alternate II in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, that are for the development or delivery of a 
                                <PRTPAGE P="274"/>
                                vessel design or any useful article embodying a vessel design.
                            </P>
                            <P>(c) Use the clause at 252.227-7025, Limitations on the Use or Disclosure of Government Furnished Information Marked with Restrictive Legends, in solicitations and contracts when it is anticipated that the Government will provide the contractor (other than a litigation support contractor covered by 252.204-7014), for performance of its contract, technical data marked with another contractor's restrictive legend(s).</P>
                            <P>(d) Use the provision at 252.227-7028, Technical Data or Computer Software Previously Delivered to the Government, in solicitations when the resulting contract will require the contractor to deliver technical data. The provision requires offerors to identify any technical data specified in the solicitations as deliverable data items that are the same or substantially the same as data items the offeror has delivered or is obligated to deliver, either as a contractor or subcontractor, under any other federal agency contract.</P>
                            <P>(e) Use the following clauses in solicitations and contracts that include the clause at 252.227-7013:</P>
                            <P>(1) 252.227-7016, Rights in Bid or Proposal Information;</P>
                            <P>(2) 252.227-7030, Technical Data—Withholding of Payment; and</P>
                            <P>(3) 252.227-7037, Validation of Restrictive Markings on Technical Data (paragraph (e) of the clause contains information that must be included in a challenge).</P>
                            <CITA>[60 FR 33471, June 28, 1995; 60 FR 41157, Aug. 11, 1995; 60 FR 61598, Nov. 30, 1995; 62 FR 2613, Jan. 17, 1997; 69 FR 31911, June 8, 2004; 74 FR 61044, Nov. 23, 2009; 76 FR 58147, Sept. 20, 2011; 78 FR 37988, June 25, 2013; 79 FR 11340, Feb. 28, 2014; 88 FR 6585, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7103-7</SECTNO>
                            <SUBJECT>Use and non-disclosure agreement.</SUBJECT>
                            <P>(a) Except as provided in paragraph (b) of this subsection, technical data or computer software delivered to the Government with restrictions on use, modification, reproduction, release, performance, display, or disclosure may not be provided to third parties unless the intended recipient completes and signs the use and non-disclosure agreement at paragraph (c) of this subsection prior to release, or disclosure of the data.</P>
                            <P>(1) The specific conditions under which an intended recipient will be authorized to use, modify, reproduce, release, perform, display, or disclose technical data subject to limited rights or computer software subject to restricted rights must be stipulated in an attachment to the use and non-disclosure agreement.</P>
                            <P>(2) For an intended release, disclosure, or authorized use of technical data or computer software subject to special license rights, modify paragraph (1)(d) of the use and non-disclosure agreement to enter the conditions, consistent with the license requirements, governing the recipient's obligations regarding use, modification, reproduction, release, performance, display or disclosure of the data or software.</P>
                            <P>(b) The requirement for use and non-disclosure agreements does not apply to Government contractors which require access to a third party's data or software for the performance of a Government contract that contains the clause at 252.227-7025, Limitations on the Use or Disclosure of Government-Furnished Information Marked with Restrictive Legends.</P>
                            <P>(c) The prescribed use and non-disclosure agreement is:</P>
                            <EXTRACT>
                                <HD SOURCE="HD3">Use and Non-Disclosure Agreement</HD>
                                <P>The undersigned, ________________ (Insert Name) ________________, an authorized representative of the ________________ (Insert Company Name) ________________, (which is hereinafter referred to as the “Recipient”) requests the Government to provide the Recipient with technical data or computer software (hereinafter referred to as “Data”) in which the Government's use, modification, reproduction, release, performance, display or disclosure rights are restricted. Those Data are identified in an attachment to this Agreement. In consideration for receiving such Data, the Recipient agrees to use the Data strictly in accordance with this Agreement:</P>
                                <P>(1) The Recipient shall—</P>
                                <P>
                                    (a) Use, modify, reproduce, release, perform, display, or disclose Data marked with government purpose rights or SBIR data rights legends only for government purposes and shall not do so for any commercial purpose. The Recipient shall not release, perform, display, or disclose these Data, without the express written permission of the 
                                    <PRTPAGE P="275"/>
                                    contractor whose name appears in the restrictive legend (the “Contractor”), to any person other than its subcontractors or suppliers, or prospective subcontractors or suppliers, who require these Data to submit offers for, or perform, contracts with the Recipient. The Recipient shall require its subcontractors or suppliers, or prospective subcontractors or suppliers, to sign a use and non-disclosure agreement prior to disclosing or releasing these Data to such persons. Such agreement must be consistent with the terms of this agreement.
                                </P>
                                <P>(b) Use, modify, reproduce, release, perform, display, or disclose technical data marked with limited rights legends only as specified in the attachment to this Agreement. Release, performance, display, or disclosure to other persons is not authorized unless specified in the attachment to this Agreement or expressly permitted in writing by the Contractor. The Recipient shall promptly notify the Contractor of the execution of this Agreement and identify the Contractor's Data that has been or will be provided to the Recipient, the date and place the Data were or will be received, and the name and address of the Government office that has provided or will provide the Data.</P>
                                <P>(c) Use computer software marked with restricted rights legends only in performance of Contract Number ________________ (insert contract number(s)) ________________. The recipient shall not, for example, enhance, decompile, disassemble, or reverse engineer the software; time share, or use a computer program with more than one computer at a time. The recipient may not release, perform, display, or disclose such software to others unless expressly permitted in writing by the licensor whose name appears in the restrictive legend. The Recipient shall promptly notify the software licensor of the execution of this Agreement and identify the software that has been or will be provided to the Recipient, the date and place the software were or will be received, and the name and address of the Government office that has provided or will provide the software.</P>
                                <P>(d) Use, modify, reproduce, release, perform, display, or disclose Data marked with special license rights legends (To be completed by the contracting officer. See 227.7103-7(a)(2). Omit if none of the Data requested is marked with special license rights legends).</P>
                                <P>(2) The Recipient agrees to adopt or establish operating procedures and physical security measures designed to protect these Data from inadvertent release or disclosure to unauthorized third parties.</P>
                                <P>(3) The Recipient agrees to accept these Data “as is” without any Government representation as to suitability for intended use or warranty whatsoever. This disclaimer does not affect any obligation the Government may have regarding Data specified in a contract for the performance of that contract.</P>
                                <P>(4) The Recipient may enter into any agreement directly with the Contractor with respect to the use, modification, reproduction, release, performance, display, or disclosure of these Data.</P>
                                <P>(5) The Recipient agrees to indemnify and hold harmless the Government, its agents, and employees from every claim or liability, including attorneys fees, court costs, and expenses arising out of, or in any way related to, the misuse or unauthorized modification, reproduction, release, performance, display, or disclosure of Data received from the Government with restrictive legends by the Recipient or any person to whom the Recipient has released or disclosed the Data.</P>
                                <P>(6) The Recipient is executing this Agreement for the benefit of the Contractor. The Contractor is a third party beneficiary of this Agreement who, in addition to any other rights it may have, is intended to have the rights of direct action against the Recipient or any other person to whom the Recipient has released or disclosed the Data, to seek damages from any breach of this Agreement or to otherwise enforce this Agreement.</P>
                                <P>(7) The Recipient agrees to destroy these Data, and all copies of the Data in its possession, no later than 30 days after the date shown in paragraph (8) of this Agreement, to have all persons to whom it released the Data do so by that date, and to notify the Contractor that the Data have been destroyed.</P>
                                <P>(8) This Agreement shall be effective for the period commencing with the Recipient's execution of this Agreement and ending upon ________ (Insert Date) ________. The obligations imposed by this Agreement shall survive the expiration or termination of the Agreement.</P>
                                <FP SOURCE="FP-DASH">Recipient's Business Name</FP>
                                <FP SOURCE="FP-DASH">By</FP>
                                <FP>Authorized Representative</FP>
                                <FP SOURCE="FP-DASH"/>
                                <FP>Date</FP>
                                <FP SOURCE="FP-DASH">Representative's Typed Name</FP>
                                <FP SOURCE="FP-DASH">and Title</FP>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of use and non-disclosure agreement)</HD>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7103-8</SECTNO>
                            <SUBJECT>Deferred delivery and deferred ordering of technical data.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Deferred delivery.</E>
                                 Use the clause at 252.227-7026, Deferred Delivery of Technical Data or Computer Software, when it is in the Government's interests to defer the delivery of technical data. 
                                <PRTPAGE P="276"/>
                                The clause permits the contracting officer to require the delivery of technical data identified as “deferred delivery” data at any time until two years after acceptance by the Government of all items (other than technical data or computer software) under the contract or contract termination, whichever is later. The obligation of subcontractors or suppliers to deliver such technical data expires two years after the date the prime contractor accepts the last item from the subcontractor or supplier for use in the performance of the contract. The contract must specify which technical data is subject to deferred delivery. The contracting officer shall notify the contractor sufficiently in advance of the desired delivery date for such data to permit timely delivery.
                            </P>
                            <P>
                                (b) 
                                <E T="03">Deferred ordering.</E>
                                 Use the clause at 252.227-7027, Deferred Ordering of Technical Data or Computer Software, when a firm requirement for a particular data item(s) has not been established prior to contract award but there is a potential need for the data. Under this clause, the contracting officer may order any data that has been generated in the performance of the contract or any subcontract thereunder at any time until three years after acceptance of all items (other than technical data or computer software) under the contract or contract termination, whichever is later. The obligation of subcontractors to deliver such data expires three years after the date the contractor accepts the last item under the subcontract. When the data are ordered, the delivery dates shall be negotiated and the contractor compensated only for converting the data into the prescribed form, reproduction costs, and delivery costs.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7103-9</SECTNO>
                            <SUBJECT>Copyright.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Copyright license.</E>
                                 (1) The clause at 252.227-7013, Rights in Technical Data—Other Than Commercial Products and Commercial Services, requires a contractor to grant or obtain for the Government license rights which permit the Government to reproduce data, distribute copies of the data, publicly perform or display the data or, through the right to modify data, prepare derivative works. The extent to which the Government, and others acting on its behalf, may exercise these rights varies for each of the standard data rights licenses obtained under the clause. When non-standard license rights in technical data will be negotiated, negotiate the extent of the copyright license concurrent with negotiations for the data rights license. Do not negotiate a copyright license that provides less rights than the standard limited rights license in technical data.
                            </P>
                            <P>(2) The clause at 252.227-7013 does not permit a contractor to incorporate a third party's copyrighted data into a deliverable data item unless the contractor has obtained an appropriate license for the Government and, when applicable, others acting on the Government's behalf, or has obtained the contracting officer's written approval to do so. Grant approval to use third party copyrighted data in which the Government will not receive a copyright license only when the Government's requirements cannot be satisfied without the third party material or when the use of the third party material will result in cost savings to the Government which outweigh the lack of a copyright license.</P>
                            <P>
                                (b) 
                                <E T="03">Copyright considerations—acquisition of existing and special works.</E>
                                 See 227.7105 or 227.7106 for copyright considerations when acquiring existing or special works.
                            </P>
                            <CITA>[60 FR 33471, June 28, 1995, as amended at 88 FR 6585, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7103-10</SECTNO>
                            <SUBJECT>Contractor identification and marking of technical data to be furnished with restrictive markings.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Identification requirements.</E>
                                 (1) The solicitation provision at 252.227-7017, Identification and Assertion of Use, Release, or Disclosure Restrictions, requires offerors to identify to the contracting officer, prior to contract award, any technical data that the offeror asserts should be provided to the Government with restrictions on use, modification, reproduction, release or disclosure. This requirement does not apply to restrictions based solely on copyright. The notification and identification must be submitted as an attachment to the offer. If an offeror fails to submit the attachment or fails 
                                <PRTPAGE P="277"/>
                                to complete the attachment in accordance with the requirements of the solicitation provision, such failure shall constitute a minor informality. Provide offerors an opportunity to remedy a minor informality in accordance with the procedures at FAR 14.405 or 15.306. An offeror's failure to correct the informality within the time prescribed by the contracting officer shall render the offer ineligible for award.
                            </P>
                            <P>(2) The procedures for correcting minor informalities shall not be used to obtain information regarding asserted restrictions or an offeror's suggested asserted rights category. Questions regarding the justification for an asserted restriction or asserted rights category must be pursued in accordance with the procedures at 227.7103-13.</P>
                            <P>(3) The restrictions asserted by a successful offeror shall be attached to its contract unless, in accordance with the procedures at 227.7103-13, the parties have agreed that an asserted restriction is not justified. The contract attachment shall provide the same information regarding identification of the technical data, the asserted rights category, the basis for the assertion, and the name of the person asserting the restrictions as required by paragraph (d) of the solicitation provision at 252.227-7017. Subsequent to contract award, the clause at 252.227-7013, Rights in Technical Data— Other Than Commercial Products and Commercial Services, permits the contractor to make additional assertions under certain conditions. The additional assertions must be made in accordance with the procedures and in the format prescribed by that clause.</P>
                            <P>(4) Neither the pre- or post-award assertions made by the contractor, nor the fact that certain assertions are identified in the attachment to the contract, determine the respective rights of the parties. As provided at 227.7103-13, the Government has the right to review, verify, challenge and validate restrictive markings.</P>
                            <P>(5) Information provided by offerors in response to the solicitation provision may be used in the source selection process to evaluate the impact on evaluation factors that may be created by restrictions on the Government's ability to use or disclose technical data. However, offerors shall not be prohibited from offering products for which the offeror is entitled to provide the Government limited rights in the technical data pertaining to such products and offerors shall not be required, either as a condition of being responsive to a solicitation or as a condition for award, to sell or otherwise relinquish any greater rights in technical data when the offeror is entitled to provide the technical data with limited rights.</P>
                            <P>
                                (b) 
                                <E T="03">Contractor marking requirements.</E>
                                 The clause at 252.227-7013, Rights in Technical Data—Other Than Commercial Products and Commercial Services—
                            </P>
                            <P>(1) Requires a contractor that desires to restrict the Government's rights in technical data to place restrictive markings on the data, provides instructions for the placement of the restrictive markings, and authorizes the use of certain restrictive markings; and</P>
                            <P>(2) Requires a contractor to deliver, furnish, or otherwise provide to the Government any technical data in which the Government has previously obtained rights with the Government's pre-existing rights in that data unless the parties have agreed otherwise or restrictions on the Government's rights to use, modify, reproduce, release, perform, display, or disclose the data have expired. When restrictions are still applicable, the contractor is permitted to mark the data with the appropriate restrictive legend for which the data qualified.</P>
                            <P>
                                (c) 
                                <E T="03">Unmarked technical data.</E>
                                 (1) Technical data delivered or otherwise provided under a contract without restrictive markings shall be presumed to have been delivered with unlimited rights and may be released or disclosed without restriction. To the extent practicable, if a contractor has requested permission (see paragraph (c)(2) of this subsection) to correct an inadvertent omission of markings, do not release or disclose the technical data pending evaluation of the request.
                            </P>
                            <P>
                                (2) A contractor may request permission to have appropriate legends placed on unmarked technical data at its expense. The request must be received by the contracting officer within six 
                                <PRTPAGE P="278"/>
                                months following the furnishing or delivery of such data, or any extension of that time approved by the contracting officer. The person making the request must:
                            </P>
                            <P>(i) Identify the technical data that should have been marked;</P>
                            <P>(ii) Demonstrate that the omission of the marking was inadvertent, the proposed marking is justified and conforms with the requirements for the marking of technical data contained in the clause at 252.227-7013; and</P>
                            <P>(iii) Acknowledge, in writing, that the Government has no liability with respect to any disclosure, reproduction, or use of the technical data made prior to the addition of the marking or resulting from the omission of the marking.</P>
                            <P>(3) Contracting officers should grant permission to mark only if the technical data were not distributed outside the Government or were distributed outside the Government with restrictions on further use or disclosure.</P>
                            <CITA>[60 FR 33471, June 28, 1995, as amended at 82 FR 61481, Dec. 28, 2017; 88 FR 6585, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7103-11</SECTNO>
                            <SUBJECT>Contractor procedures and records.</SUBJECT>
                            <P>(a) The clause at 252.227-7013, Rights in Technical Data— Other Than Commercial Products and Commercial Services, requires a contractor, and its subcontractors or suppliers that will deliver technical data with other than unlimited rights, to establish and follow written procedures to assure that restrictive markings are used only when authorized and to maintain records to justify the validity of asserted restrictions on delivered data.</P>
                            <P>(b) The clause at 252.227-7037, Validation of Restrictive Markings on Technical Data requires contractors and their subcontractors at any tier to maintain records sufficient to justify the validity of restrictive markings on technical data delivered or to be delivered under a Government contract.</P>
                            <CITA>[60 FR 33471, June 28, 1995, as amended at 88 FR 6585, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7103-12</SECTNO>
                            <SUBJECT>Government right to establish conformity of markings.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Nonconforming markings.</E>
                                 (1) Authorized markings are identified in the clause at 252.227-7013, Rights in Technical Data—Other Than Commercial Products and Commercial Services. All other markings are nonconforming markings. An authorized marking that is not in the form, or differs in substance, from the marking requirements in the clause at 252.227-7013 is also a nonconforming marking.
                            </P>
                            <P>(2) The correction of nonconforming markings on technical data is not subject to 252.227-7037, Validation of Restrictive Markings on Technical Data. To the extent practicable, the contracting officer should return technical data bearing nonconforming markings to the person who has placed the nonconforming markings on such data to provide that person an opportunity to correct or strike the nonconforming marking at that person's expense. If that person fails to correct the nonconformity and return the corrected data within 60 days following the person's receipt of the data, the contracting officer may correct or strike the nonconformity at that person's expense. When it is impracticable to return technical data for correction, contracting officers may unilaterally correct any nonconforming markings at Government expense. Prior to correction, the data may be used in accordance with the proper restrictive marking.</P>
                            <P>
                                (b) 
                                <E T="03">Unjustified markings.</E>
                                 (1) An unjustified marking is an authorized marking that does not depict accurately restrictions applicable to the Government's use, modification, reproduction, release, performance, display, or disclosure of the marked technical data. For example, a limited rights legend placed on technical data pertaining to items, components, or processes that were developed under a Government contract either exclusively at Government expense or with mixed funding (situations under which the Government obtains unlimited or government purpose rights) is an unjustified marking.
                            </P>
                            <P>
                                (2) Contracting officers have the right to review and challenge the validity of unjustified markings. However, at any time during performance of a contract and notwithstanding existence of a challenge, the contracting officer and the person who has asserted a restrictive marking may agree that the 
                                <PRTPAGE P="279"/>
                                restrictive marking is not justified. Upon such agreement, the contracting officer may, at his or her election, either—
                            </P>
                            <P>(i) Strike or correct the unjustified marking at that person's expense; or</P>
                            <P>(ii) Return the technical data to the person asserting the restriction for correction at that person's expense. If the data are returned and that person fails to correct or strike the unjustified restriction and return the corrected data to the contracting officer within 60 days following receipt of the data, the unjustified marking shall be corrected or stricken at that person's expense.</P>
                            <CITA>[60 FR 33471, June 28, 1995, as amended at 88 FR 6585, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7103-13</SECTNO>
                            <SUBJECT>Government right to review, verify, challenge, and validate asserted restrictions.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">General.</E>
                                 An offeror's assertion(s) of restrictions on the Government's rights to use, modify, reproduce, release, or disclose technical data do not, by themselves, determine the extent of the Government's rights in the technical data. Under 10 U.S.C. 3782, the Government has the right to challenge asserted restrictions when there are reasonable grounds to question the validity of the assertion and continued adherence to the assertion would make it impractical to later procure competitively the item to which the data pertain.
                            </P>
                            <P>
                                (b) 
                                <E T="03">Pre-award considerations.</E>
                                 The challenge procedures required by 10 U.S.C. 3782 could significantly delay awards under competitive procurements. Therefore, avoid challenging asserted restrictions prior to a competitive contract award unless resolution of the assertion is essential for successful completion of the procurement.
                            </P>
                            <P>
                                (c) 
                                <E T="03">Challenge considerations and presumption</E>
                                —(1) 
                                <E T="03">Requirements to initiate a challenge.</E>
                                 Contracting officers shall have reasonable grounds to challenge the validity of an asserted restriction. Before issuing a challenge to an asserted restriction, carefully consider all available information pertaining to the assertion.
                            </P>
                            <P>
                                (2) 
                                <E T="03">Commercial products and commercial services—presumption regarding development exclusively at private expense.</E>
                                 10 U.S.C. 3772(a)(1) and 3784 establish a presumption and procedures regarding validation of asserted restrictions for technical data related to commercial products or commercial services on the basis of development exclusively at private expense. Contracting officers shall presume that a commercial product or commercial service was developed exclusively at private expense whether or not a contractor or subcontractor submits a justification in response to a challenge notice. The contracting officer shall not challenge a contractor's assertion that a commercial product or commercial service was developed exclusively at private expense unless the Government can specifically state the reasonable grounds to question the validity of the assertion. The challenge notice shall include sufficient information to reasonably demonstrate that the commercial product or commercial service was not developed exclusively at private expense. In order to sustain the challenge, the contracting officer shall provide information demonstrating that the commercial product or commercial service was not developed exclusively at private expense. The challenge notice and all related correspondence shall be subject to handling procedures for classified information and controlled unclassified information. A contractor's or subcontractor's failure to respond to the challenge notice cannot be the sole basis for issuing a final decision denying the validity of an asserted restriction.
                            </P>
                            <P>
                                (d) 
                                <E T="03">Challenge and validation.</E>
                                 All challenges shall be made in accordance with the provisions of the clause at 252.227-7037, Validation of Restrictive Markings on Technical Data.
                            </P>
                            <P>
                                (1) 
                                <E T="03">Challenge period.</E>
                                 Asserted restrictions should be reviewed before acceptance of technical data deliverable under the contract. Assertions must be challenged within three years after final payment under the contract or three years after delivery of the data, whichever is later. However, restrictive markings may be challenged at any time if the technical data—
                            </P>
                            <P>(i) Are publicly available without restrictions;</P>
                            <P>(ii) Have been provided to the United States without restriction; or</P>
                            <P>
                                (iii) Have been otherwise made available without restriction other than a 
                                <PRTPAGE P="280"/>
                                release or disclosure resulting from the sale, transfer, or other assignment of interest in the technical data to another party or the sale or transfer of some or all of a business entity or its assets to another party.
                            </P>
                            <P>
                                (2) 
                                <E T="03">Pre-challenge requests for information.</E>
                                 (i) After consideration of the situations described in paragraph (d)(3) of this section, contracting officers may request the person asserting a restriction to furnish a written explanation of the facts and supporting documentation for the assertion in sufficient detail to enable the contracting officer to ascertain the basis of the restrictive markings. Additional supporting documentation may be requested when the explanation provided by the person making the assertion does not, in the contracting officer's opinion, establish the validity of the assertion.
                            </P>
                            <P>(ii) If the person asserting the restriction fails to respond to the contracting officer's request for information or additional supporting documentation, or if the information submitted or any other available information pertaining to the validity of a restrictive marking does not justify the asserted restriction, a challenge should be considered.</P>
                            <P>
                                (3) 
                                <E T="03">Transacting matters directly with subcontracts.</E>
                                 The clause at 252.227-7037 obtains the contractor's agreement that the Government may transact matters under the clause directly with a subcontractor, at any tier, without creating or implying privity of contract. Contracting officers should permit a subcontractor or supplier to transact challenge and validation matters directly with the Government when—
                            </P>
                            <P>(i) A subcontractor's or supplier's business interests in its technical data would be compromised if the data were disclosed to a higher tier contractor;</P>
                            <P>(ii) There is reason to believe that the contractor will not respond in a timely manner to a challenge and an untimely response would jeopardize a subcontractor's or suppliers right to assert restrictions; or</P>
                            <P>(iii) Requested to do so by a subcontractor or supplier.</P>
                            <P>
                                (4) 
                                <E T="03">Challenge notice.</E>
                                 The contracting officer shall not issue a challenge notice unless there are reasonable grounds to question the validity of an assertion. For commercial products or commercial services, also see paragraph (c)(2) of this section. The contracting officer may challenge an assertion whether or not supporting documentation was requested under paragraph (d)(2) of this section. Challenge notices shall be in writing and issued to the contractor or, after consideration of the situations described in paragraph (d)(3) of this section, the person asserting the restriction. The challenge notice shall include the information in paragraph (e) of the clause at 252.227-7037.
                            </P>
                            <P>
                                (5) 
                                <E T="03">Extension of response time.</E>
                                 The contracting officer, at his or her discretion, may extend the time for response contained in a challenge notice, as appropriate, if the contractor submits a timely written request showing the need for additional time to prepare a response.
                            </P>
                            <P>
                                (6) 
                                <E T="03">Contracting officer's final decision.</E>
                                 Contracting officers must issue a final decision for each challenged assertion, whether or not the assertion has been justified.
                            </P>
                            <P>(i) A contracting officer's final decision that an assertion is not justified must be issued a soon as practicable following the failure of the person asserting the restriction to respond to the contracting officer's challenge within 60 days, or any extension to that time granted by the contracting officer.</P>
                            <P>(ii) A contracting officer who, following a challenge and response by the person asserting the restriction, determines that an asserted restriction is justified, shall issue a final decision sustaining the validity of the asserted restriction. If the asserted restriction was made subsequent to submission of the contractor's offer, add the asserted restriction to the contract attachment.</P>
                            <P>
                                (iii) A contracting officer who determine that the validity of an asserted restriction has not been justified shall issue a contracting officer's final decision within the time frames prescribed in 252.227-7037. As provided in paragraph (g) of that clause, the Government is obligated to continue to respect the asserted restrictions through final disposition of any appeal unless 
                                <PRTPAGE P="281"/>
                                the agency head notifies the person asserting the restriction that urgent or compelling circumstances do not permit the Government to continue to respect the asserted restriction.
                            </P>
                            <P>
                                (7) 
                                <E T="03">Multiple challenges to an asserted restriction.</E>
                                 When more than one contracting officer challenges an asserted restriction, the contracting officer who made the earliest challenge is responsible for coordinating the Government challenges. That contracting officer shall consult with all other contracting officers making challenges, verify that all challenges apply to the same asserted restriction and, after consulting with the contractor, subcontractor, or supplier asserting the restriction, issue a schedule that provides that person a reasonable opportunity to respond to each challenge.
                            </P>
                            <P>
                                (8) 
                                <E T="03">Validation.</E>
                                 Only a contracting officer's final decision, or actions of an agency board of contract appeals or a court of competent jurisdiction, that sustain the validity of an asserted restriction constitute validation of the asserted restriction.
                            </P>
                            <CITA>[60 FR 33471, June 28, 1995, as amended at 81 FR 65566, Sept. 23, 2016; 87 FR 25151, Apr. 28, 2022; 87 FR 76994, Dec. 16, 2022; 88 FR 6585, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7103-14</SECTNO>
                            <SUBJECT>Conformity, acceptance, and warranty of technical data.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Statutory requirements.</E>
                                 10 U.S.C. 3772—
                            </P>
                            <P>(1) Provides for the establishment of remedies applicable to technical data found to be incomplete, inadequate, or not to satisfy the requirements of the contract concerning such data; and</P>
                            <P>(2) Authorizes agency heads to withhold payments (or exercise such other remedies an agency head considers appropriate) during any period if the contractor does not meet the requirements of the contract pertaining to the delivery of technical data.</P>
                            <P>
                                (b) 
                                <E T="03">Conformity and acceptance.</E>
                                 (1) Solicitations and contracts requiring the delivery of technical data shall specify the requirements the data must satisfy to be acceptable. Contracting officers, or their authorized representatives, are responsible for determining whether technical data tendered for acceptance conform to the contractual requirements.
                            </P>
                            <P>(2) The clause at 252.227-7030, Technical Data—Withholding of Payment, provides for withholding up to 10 percent of the contract price pending correction or replacement of the nonconforming technical data or negotiation of an equitable reduction in contract price. The amount subject to withholding may be expressed as a fixed dollar amount or as a percentage of the contract price. In either case, the amount shall be determined giving consideration to the relative value and importance of the data. For example—</P>
                            <P>(i) When the sole purpose of a contract is to produce the data, the relative value of that data may be considerably higher than the value of data produced under a contract where the production of the data is a secondary objective; or</P>
                            <P>(ii) When the Government will maintain or repair items, repair and maintenance data may have a considerably higher relative value than data that merely describe the item or provide performance characteristics.</P>
                            <P>(3) Do not accept technical data that do not conform to the contractual requirements in all respects. Except for nonconforming restrictive markings (see paragraph (b)(4) of this subsection), correction or replacement of nonconforming data or an equitable reduction in contract price when correction or replacement of the nonconforming data is not practicable or is not in the Government's interests, shall be accomplished in accordance with—</P>
                            <P>(i) The provisions of a contract clause providing for inspection and acceptance of deliverables and remedies for nonconforming deliverables; or</P>
                            <P>(ii) The procedures at FAR 46.407(c) through (g), if the contract does not contain an inspection clause providing remedies for nonconforming deliverables.</P>
                            <P>
                                (4) Follow the procedures at 227.7103-12(a)(2) if nonconforming markings are the sole reason technical data fail to conform to contractual requirements. The clause at 252.227-7030 may be used to withhold an amount for payment, consistent with the terms of the clause, pending correction of the nonconforming markings.
                                <PRTPAGE P="282"/>
                            </P>
                            <P>
                                (c) 
                                <E T="03">Warranty.</E>
                                 (1) The intended use of the technical data and the cost, if any, to obtain the warranty should be considered before deciding to obtain a data warranty (see FAR 46.703). The fact that a particular item, component, or process is or is not warranted is not a consideration in determining whether or not to obtain a warranty for the technical data that pertain to the item, component, or process. For example, a data warranty should be considered if the Government intends to repair or maintain an item and defective repair or maintenance data would impair the Government's effective use of the item or result in increased costs to the Government.
                            </P>
                            <P>(2) As prescribed in 246.710, use the clause at 252.246-7001, Warranty of Data, and its alternates, or a substantially similar clause when the Government needs a specific warranty of technical data.</P>
                            <CITA>[60 FR 33471, June 28, 1995, as amended at 69 FR 31912, June 8, 2004; 87 FR 76994, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7103-15</SECTNO>
                            <SUBJECT>Subcontractor rights in technical data.</SUBJECT>
                            <P>(a) 10 U.S.C. 3771 provides subcontractors at all tiers the same protection for their rights in data as is provided to prime contractors. The clauses at 252.227-7013, Rights in Technical Data—Other Than Commercial Products and Commercial Services, and 252.227-7037, Validation of Restrictive Markings on Technical Data, implement the statutory requirements.</P>
                            <P>(b) 10 U.S.C. 3782 permits a subcontractor to transact directly with the Government matters relating to the validation of its asserted restrictions on the Government's rights to use or disclose technical data. The clause at 252.227-7037 obtains a contractor's agreement that the direct transaction of validation or challenge matters with subcontractors at any tier does not establish or imply privity of contract. When a subcontractor or supplier exercise its right to transact validation matters directly with the Government, contracting officers shall deal directly with such persons, as provided at 227.7103-13(c)(3).</P>
                            <P>(c) Require prime contractors whose contracts include the following clauses to include those clauses, without modification except for appropriate identification of the parties, in contracts with subcontractors or suppliers, at all tiers, who will be furnishing technical data for other than commercial products or commercial services in response to a Government requirement:</P>
                            <P>(1) 252.227-7013, Rights in Technical Data—Other Than Commercial Products and Commercial Services;</P>
                            <P>(2) 252.227-7025, Limitations on the Use or Disclosure of Government-Furnished Information Marked with Restrictive Legends;</P>
                            <P>(3) 252.227-7028, Technical Data or Computer Software Previously Delivered to the Government; and</P>
                            <P>(4) 252.227-7037, Validation of Restrictive Markings on Technical Data.</P>
                            <P>(d) Do not require contractors to have their subcontractors or suppliers at any tier relinquish rights in technical data to the contractor, a higher tier subcontractor, or to the Government, as a condition for award of any contract, subcontract, purchase order, or similar instrument except for the rights obtained by the Government under the Rights in Technical Data—Other Than Commercial Products and Commercial Services clause contained in the contractor's contract with the Government.</P>
                            <CITA>[56 FR 36389, July 31, 1991, as amended at 60 FR 61598, Nov. 30, 1995; 87 FR 76994, Dec. 16, 2022; 88 FR 6585, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7103-16</SECTNO>
                            <SUBJECT>Providing technical data to foreign governments, foreign contractors, or international organizations.</SUBJECT>
                            <P>Technical data may be released or disclosed to foreign governments, foreign contractors, or international organizations only if release or disclosure is otherwise permitted both by Federal export controls and other national security laws or regulations. Subject to such laws and regulations, the Department of Defense—</P>
                            <P>(a) May release or disclose technical data in which it has obtained unlimited rights to such foreign entities or authorize the use of such data by those entities; and</P>
                            <P>
                                (b) Shall not release or disclose technical data for which restrictions on 
                                <PRTPAGE P="283"/>
                                use, release, or disclosure have been asserted to foreign entities, or authorize the use of technical data by those entities, unless the intended recipient is subject to the same provisions as included in the use and non-disclosure agreement at 227.7103-7 and the requirements of the clause at 252.227-7103, Rights in Technical Data—Other Than Commercial Products and Commercial Services, governing use, modification, reproduction, release, performance, display, or disclosure of such data have been satisfied.
                            </P>
                            <CITA>[60 FR 33471, June 28, 1995, as amended at 88 FR 6586, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7103-17</SECTNO>
                            <SUBJECT>Overseas contracts with foreign sources.</SUBJECT>
                            <P>(a) The clause at 252.227-7032, Rights in Technical Data and Computer Software (Foreign), may be used in contracts with foreign contractors to be performed overseas, except Canadian purchases (see paragraph (c) of this subsection), in lieu of the clause at 252.227-7013, Rights in Technical Data—Other Than Commercial Products and Commercial Services, when the Government requires the unrestricted right to use, modify, reproduce, perform, display, release, or disclose all technical data to be delivered under the contract. Do not use the clause in contracts for existing or special works.</P>
                            <P>(b) When the Government does not require unlimited rights, the clause at 252.227-7032 may be modified to accommodate the needs of a specific overseas procurement situation. The Government should obtain rights in the technical data that are not less than the rights the Government would have obtained under the data rights clause(s) prescribed in this part for a comparable procurement performed within the United States or its outlying areas.</P>
                            <P>(c) Contracts for Canadian purchases shall include the appropriate data rights clause prescribed in this part for a comparable procurement performed within the United States or its outlying areas.</P>
                            <CITA>[56 FR 36389, July 31, 1991, as amended at 70 FR 35545, June 21, 2005; 88 FR 6586, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7104</SECTNO>
                            <SUBJECT>Contracts under the Small Business Innovation Research (SBIR) Program.</SUBJECT>
                            <P>(a) Use the clause at 252.227-7018, Rights in Other Than Commercial Technical Data and Computer Software—Small Business Innovation Research (SBIR) Program, when technical data or computer software will be generated during performance of contracts under the SBIR program.</P>
                            <P>(b) Under the clause at 252.227-7018, the Government obtains SBIR data rights in technical data and computer software generated under the contract and marked with the SBIR data rights legend. SBIR data rights provide the Government limited rights in such technical data and restricted rights in such computer software during the SBIR data protection period commencing with contract award and ending five years after completion of the project under which the data were generated. Upon expiration of the five-year restrictive license, the Government has unlimited rights in the SBIR technical data and computer software.</P>
                            <P>(c) During the SBIR data protection period, the Government may not release or disclose SBIR technical data or computer software to any person except as authorized for limited rights technical data or restricted rights computer software, respectively.</P>
                            <P>(d) Use the clause at 252.227-7018 with its Alternate I in research contracts when the contracting officer determines, in consultation with counsel, that public dissemination by the contractor would be—</P>
                            <P>(1) In the interest of the Government; and</P>
                            <P>(2) Facilitated by the Government relinquishing its right to publish the work for sale, or to have others publish the work for sale on behalf of the Government.</P>
                            <P>(e) Use the following provision and clauses in SBIR solicitations and contracts that include the clause at 252.227-7018:</P>
                            <P>(1) 252.227-7016, Rights in Bid or Proposal Information;</P>
                            <P>
                                (2) 252.227-7017, Identification and Assertion of Use, Release, or Disclosure Restrictions;
                                <PRTPAGE P="284"/>
                            </P>
                            <P>(3) 252.227-7019, Validation of Asserted Restrictions—Computer Software;</P>
                            <P>(4) 252.227-7030, Technical Data—Withholding of Payment; and</P>
                            <P>(5) 252.227-7037, Validation of Restrictive Markings on Technical Data (paragraph (e) of the clause contains information that must be included in a challenge).</P>
                            <P>(f) Use the following clauses and provision in SBIR solicitations and contracts in accordance with the guidance at 227.7103-6 (c) and (d):</P>
                            <P>(1) 252.227-7025, Limitations on the Use or Disclosure of Government-Furnished Information Marked with Restrictive Legends; and</P>
                            <P>(2) 252.227-7028, Technical Data or Computer Software Previously Delivered to the Government.</P>
                            <CITA>[56 FR 36389, July 31, 1991, as amended at 60 FR 61598, Nov. 30, 1995; 62 FR 2614, Jan. 17, 1997; 69 FR 31912, June 8, 2004; 78 FR 30238, May 22, 2013; 88 FR 6586, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7105</SECTNO>
                            <SUBJECT>Contracts for the acquisition of existing works.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7105-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>(a) Existing works include motion pictures, television recordings, video recordings, and other audiovisual works in any medium; sound recordings in any medium; musical, dramatic, and literary works; pantomimes and choreographic works; pictorial, graphic, and sculptural works; and works of a similar nature. Usually, these or similar works were not first created, developed, generated, originated, prepared, or produced under a Government contract. Therefore, the Government must obtain a license in the work if it intends to reproduce the work, distribute copies of the work, prepare derivative works, or perform or display the work publicly. When the Government is not responsible for the content of an existing work, it should require the copyright owner to indemnify the Government for liabilities that may arise out of the content, performance, use, or disclosure of such data.</P>
                            <P>(b) Follow the procedures at 227.7106 for works which will be first created, developed, generated, originated, prepared, or produced under a Government contract and the Government needs to control distribution of the work or has a specific need to obtain indemnity for liabilities that may arise out of the creation, content, performance, use, or disclosure of the work or from libelous or other unlawful material contained in the work. Follow the procedures at 227.7103 when the Government does not need to control distribution of such works or obtain such indemnities.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7105-2</SECTNO>
                            <SUBJECT>Acquisition of existing works without modification.</SUBJECT>
                            <P>(a) Use the clause at 252.227-7021, Rights in Data—Existing Works, in lieu of the clause at 252.227-7013, Rights in Technical Data—Other Than Commercial Products and Commercial Services, in solicitations and contracts exclusively for existing works when—</P>
                            <P>(1) The existing works will be acquired without modification; and</P>
                            <P>(2) The Government requires the right to reproduce, prepare derivative works, or publicly perform or display the existing works; or</P>
                            <P>(3) The Government has a specific need to obtain indemnity for liabilities that may arise out of the content, performance, use, or disclosure of such data.</P>
                            <P>(b) The clause at 252.227-7021 provides the Government, and others acting on its behalf, a paid-up, non-exclusive, irrevocable, world-wide license to reproduce, prepare derivative works and publicly perform or display the works called for by a contract and to authorize others to do so for government purposes.</P>
                            <P>(c) A contract clause is not required to acquire existing works such as books, magazines and periodicals, in any storage or retrieval medium, when the Government will not reproduce the books, magazines or periodicals, or prepare derivative works.</P>
                            <CITA>[60 FR 33471, June 28, 1995, as amended at 88 FR 6586, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7105-3</SECTNO>
                            <SUBJECT>Acquisition of modified existing works.</SUBJECT>
                            <P>Use the clause at 252.227-7020, Rights in Special Works, in solicitations and contracts for modified existing works in lieu of the clause at 252.227-7021, Rights in Data—Existing Works.</P>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="285"/>
                            <SECTNO>227.7106</SECTNO>
                            <SUBJECT>Contracts for special works.</SUBJECT>
                            <P>(a) Use the clause at 252.227-7020, Rights in Special Works, in solicitations and contracts where the Government has a specific need to control the distribution of works first produced, created, or generated in the performance of a contract and required to be delivered under that contract, including controlling distribution by obtaining an assignment of copyright, or a specific need to obtain indemnity for liabilities that may arise out of the creation, delivery, use, modification, reproduction, release, performance, display, or disclosure of such works. Use the clause—</P>
                            <P>(1) In lieu of the clause at 252.227-7013, Rights in Technical Data—Other Than Commercial Products and Commercial Services, when the Government must own or control copyright in all works first produced, created, or generated and required to be delivered under a contract; or</P>
                            <P>(2) In addition to the clause at 252.227-7013 when the Government must own or control copyright in a portion of a work first produced, created, or generated and required to be delivered under a contract. The specific portion in which the Government must own or control copyright must be identified in a special contract requirement.</P>
                            <P>(b) Although the Government obtains an assignment of copyright and unlimited rights in a special work under the clause at 252.227-7020, the contractor retains use and disclosure rights in that work. If the Government needs to restrict a contractor's rights to use or disclose a special work, it must also negotiate a special license which specifically restricts the contractor's use or disclosure rights.</P>
                            <P>(c) The clause at 252.227-7020 does not permit a contractor to incorporate into a special work any works copyrighted by others unless the contractor obtains the contracting officer's permission to do so and obtains for the Government a non-exclusive, paid up, world-wide license to make and distribute copies of that work, to prepare derivative works, to perform or display publicly any portion of the work, and to permit others to do so for government purposes. Grant permission only when the Government's requirements cannot be satisfied unless the third party work is included in the deliverable work.</P>
                            <P>(d) Examples of works which may be procured under the Rights in Special Works clause include, but are not limited, to audiovisual works, computer data bases, computer software documentation, scripts, soundtracks, musical compositions, and adaptations; histories of departments, agencies, services or units thereof; surveys of Government establishments; instructional works or guidance to Government officers and employees on the discharge of their official duties; reports, books, studies, surveys or similar documents; collections of data containing information pertaining to individuals that, if disclosed, would violate the right of privacy or publicity of the individuals to whom the information relates; or investigative reports.</P>
                            <CITA>[60 FR 33471, June 28, 1995, as amended at 88 FR 6586, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7107</SECTNO>
                            <SUBJECT>Contracts for architect-engineer services.</SUBJECT>
                            <P>This section sets forth policies and procedures, pertaining to data, copyrights, and restricted designs unique to the acquisition of construction and architect-engineer services.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7107-1</SECTNO>
                            <SUBJECT>Architectural designs and data clauses for architect-engineer or construction contracts.</SUBJECT>
                            <P>(a) Except as provided in paragraph (b) of this subsection and in 227.7107-2, use the clause at 252.227-7022, Government Rights (Unlimited), in solicitations and contracts for architect-engineer services and for construction involving architect-engineer services.</P>
                            <P>
                                (b) When the purpose of a contract for architect-engineer services, or for construction involving architect-engineer services, is to obtain a unique architectural design of a building, a monument, or construction of similar nature, which for artistic, aesthetic or other special reasons the Government does not want duplicated, the Government may acquire exclusive control of the data pertaining to the design by including the clause at 252.227-7023, Drawings and Other Data to Become Property of Government, in solicitations and contracts.
                                <PRTPAGE P="286"/>
                            </P>
                            <P>(c) The Government shall obtain unlimited rights in shop drawings for construction. In solicitations and contracts calling for delivery of shop drawings, include the clause at 252.227-7033, Rights in Shop Drawings.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7107-2</SECTNO>
                            <SUBJECT>Contracts for construction supplies and research and development work.</SUBJECT>
                            <P>Use the provisions and clauses required by 227-7103-6 and 227.7203-6 when the acquisition is limited to—</P>
                            <P>(a) Construction supplies or materials;</P>
                            <P>(b) Experimental, developmental, or research work, or test and evaluation studies of structures, equipment, processes, or materials for use in construction; or</P>
                            <P>(c) Both.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7107-3</SECTNO>
                            <SUBJECT>Approval of restricted designs.</SUBJECT>
                            <P>The clause at 252.227-7024, Notice and Approval of Restricted Designs, may be included in architect-engineer contracts to permit the Government to make informed decisions concerning noncompetitive aspects of the design.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7108</SECTNO>
                            <SUBJECT>Contractor data repositories.</SUBJECT>
                            <P>(a) Contractor data repositories may be established when permitted by agency procedures. The contractual instrument establishing the data repository must require, as a minimum, the data repository management contractor to—</P>
                            <P>(1) Establish and maintain adequate procedures for protecting technical data delivered to or stored at the repository from unauthorized release or disclosure;</P>
                            <P>(2) Establish and maintain adequate procedures for controlling the release or disclosure of technical data from the repository to third parties consistent with the Government's rights in such data;</P>
                            <P>(3) When required by the contracting officer, deliver data to the Government on paper or in other specified media;</P>
                            <P>(4) Be responsible for maintaining the currency of data delivered directly by Government contractors or subcontractors to the repository;</P>
                            <P>(5) Obtain use and non-disclosure agreements (see 227.7103-7) from all persons to whom government purpose rights data is released or disclosed; and</P>
                            <P>(6) Indemnify the Government from any liability to data owners or licensors resulting from, or as a consequence of, a release or disclosure of technical data made by the data repository contractor or its officers, employees, agents, or representatives.</P>
                            <P>(b) If the contractor is or will be the data repository manager, the contractor's data management and distribution responsibilities must be identified in the contract or the contract must reference the agreement between the Government and the contractor that establishes those responsibilities.</P>
                            <P>(c) If the contractor is not and will not be the data repository manager, do not require a contractor or subcontractor to deliver technical data marked with limited rights legends to a data repository managed by another contractor unless the contractor or subcontractor who has asserted limited rights agrees to release the data to the repository or has authorized, in writing, the Government to do so.</P>
                            <P>(d) Repository procedures may provide for the acceptance, delivery, and subsequent distribution of technical data in storage media other than paper, including direct electronic exchange of data between two computers. The procedures must provide for the identification of any portions of the data provided with restrictive legends, when appropriate. The acceptance criteria must be consistent with the authorized delivery format.</P>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 227.72—Computer Software, Computer Software Documentation, and Associated Rights</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>60 FR 33482, June 28, 1995, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>227.7200</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>
                                (a) This subpart—
                                <PRTPAGE P="287"/>
                            </P>
                            <P>(1) Prescribes policies and procedures for the acquisition of computer software and computer software documentation, and the rights to use, modify, reproduce, release, perform, display, or disclose such software or documentation. It implements the following laws and Executive order:</P>
                            <P>(i) 10 U.S.C. 3013.</P>
                            <P>(ii) 10 U.S.C. 3208(d).</P>
                            <P>(iii) 10 U.S.C. 3771-3775.</P>
                            <P>(iv) 10 U.S.C. 3781-3786.</P>
                            <P>(v) 10 U.S.C. 4576.</P>
                            <P>(vi) Executive Order 12591 (subsection 1(b)(7)).</P>
                            <P>(2) Does not apply to—</P>
                            <P>(i) Computer software or computer software documentation acquired under General Services Administration (GSA) schedule contracts; or</P>
                            <P>(ii) Releases of computer software or computer software documentation to litigation support contractors (see subpart 204.74).</P>
                            <P>(b) See PGI 227.7200(b) for guidance and information in DoD issuances.</P>
                            <CITA>[88 FR 17344, Mar. 22, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7201</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>(a) As used in this subpart, unless otherwise specifically indicated, the terms “offeror” and “contractor” include an offeror's or contractor's subcontractors, suppliers, or potential subcontractors or suppliers at any tier.</P>
                            <P>(b) Other terms used in this subpart are defined in the clause at 252.227-7014, Rights in Other Than Commercial Computer Software and Other Than Commercial Computer Software Documentation.</P>
                            <CITA>[60 FR 33482, June 28, 1995, as amended at 88 FR 6586, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7202</SECTNO>
                            <SUBJECT>Commercial computer software and commercial computer software documentation.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7202-1</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(a) Commercial computer software or commercial computer software documentation shall be acquired under the licenses customarily provided to the public unless such licenses are inconsistent with Federal procurement law or do not otherwise satisfy user needs.</P>
                            <P>(b) Commercial computer software and commercial computer software documentation shall be obtained competitively, to the maximum extent practicable, using firm-fixed-price contracts or firm-fixed-priced orders under available pricing schedules.</P>
                            <P>(c) Offerors and contractors shall not be required to—</P>
                            <P>(1) Furnish technical information related to commercial computer software or commercial computer software documentation that is not customarily provided to the public except for information documenting the specific modifications made at Government expense to such software or documentation to meet the requirements of a Government solicitation; or</P>
                            <P>(2) Relinquish to, or otherwise provide, the Government rights to use, modify, reproduce, release, perform, display, or disclose commercial computer software or commercial computer software documentation except for a transfer of rights mutually agreed upon.</P>
                            <P>(d) When establishing contract requirements and negotiation objectives to meet agency needs, the Government should consider the factors identified in 227.7203-2(b) and (c) for commercial computer software and computer software documentation, consistent with paragraph (c) of this section.</P>
                            <CITA>[60 FR 33482, June 28, 1995, as amended at 88 FR 17344, Mar. 22, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7202-2</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7202-3</SECTNO>
                            <SUBJECT>Rights in commercial computer software or commercial computer software documentation.</SUBJECT>
                            <P>(a) The Government shall have only the rights specified in the license under which the commercial computer software or commercial computer software documentation was obtained.</P>
                            <P>(b) If the Government has a need for rights not conveyed under the license customarily provided to the public, the Government must negotiate with the contractor to determine if there are acceptable terms for transferring such rights. The specific rights granted to the Government shall be enumerated in the contract license agreement or an addendum thereto.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7202-4</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>
                                A specific contract clause governing the Government's rights in commercial 
                                <PRTPAGE P="288"/>
                                computer software or commercial computer software documentation is not prescribed. As required by 227.7202-3, the Government's rights to use, modify, reproduce, release, perform, display, or disclose computer software or computer software documentation shall be identified in a license agreement.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7203</SECTNO>
                            <SUBJECT>Other than commercial computer software and other than commercial computer software documentation.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7203-1</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(a) DoD policy is to acquire only the computer software and computer software documentation, and the rights in such software or documentation, necessary to satisfy agency needs.</P>
                            <P>(b) Solicitations and contracts shall—</P>
                            <P>(1) Specify the computer software or computer software documentation to be delivered under a contract and the delivery schedules for the software or documentation;</P>
                            <P>(2) Establish or reference procedures for determining the acceptability of computer software or computer software documentation;</P>
                            <P>(3) Establish separate contract line items, to the extent practicable, for the computer software or computer software documentation to be delivered under a contract and require offerors and contractors to price separately each deliverable data item; and</P>
                            <P>(4) Require offerors to identify, to the extent practicable, computer software or computer software documentation to be furnished with restrictions on the Government's rights and require contractors to identify computer software or computer software documentation to be delivered with such restrictions prior to delivery.</P>
                            <P>(c) Offerors shall not be required, either as a condition of being responsive to a solicitation or as a condition for award, to sell or otherwise relinquish to the Government any rights in computer software developed exclusively at private expense except for the software identified at 227.7203-5(a) (3) through (6).</P>
                            <P>(d) Offerors and contractors shall not be prohibited or discouraged from furnishing or offering to furnish computer software developed exclusively at private expense solely because the Government's rights to use, modify, release, reproduce, perform, display, or disclose the software may be restricted.</P>
                            <P>(e) For acquisitions involving major weapon systems or subsystems of major weapon systems, the acquisition plan shall address acquisition strategies that provide for computer software and computer software documentation, and the associated license rights, in accordance with 207.106(S-70).</P>
                            <CITA>[60 FR 33471, June 28, 1995, as amended at 72 FR 51189, Sept. 6, 2007]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7203-2</SECTNO>
                            <SUBJECT>Acquisition of other than commercial computer software and computer software documentation and associated rights.</SUBJECT>
                            <P>(a) Contracting officers shall work closely with data managers and requirements personnel to assure that computer software and computer software documentation requirements included in solicitations are consistent with the policy expressed in 227.7203-1.</P>
                            <P>(b)(1) Data managers or other requirements personnel are responsible for identifying the Government's life-cycle needs for computer software and computer software documentation. See PGI 227.7203-2(b) for further guidance on assessing life-cycle needs. In addition to desired software performance, compatibility, or other technical considerations, identification of life-cycle needs should consider such factors as—</P>
                            <P>(i) The offeror's economic interests in software that has been developed at private expense (including the economic interests of small businesses and nontraditional contractors);</P>
                            <P>(ii) The Government's costs to develop, acquire, maintain, store, retrieve, and protect the computer software and computer software documentation;</P>
                            <P>(iii) Multiple site or shared use requirements;</P>
                            <P>(iv) Whether the Government's software maintenance philosophy will require the right to modify or have third parties modify the software; and</P>
                            <P>
                                (v) Any special computer software documentation requirements.
                                <PRTPAGE P="289"/>
                            </P>
                            <P>
                                (2)(i) 
                                <E T="03">Procurement planning.</E>
                                 To the maximum extent practicable, when assessing the life-cycle needs, data managers or other requirements personnel will address in the procurement planning and requirements documents (
                                <E T="03">e.g.,</E>
                                 acquisition plans, purchase requests) the acquisition at appropriate times in the life cycle of all computer software, related recorded information, and associated license rights necessary to—
                            </P>
                            <P>
                                (A) Reproduce, build, or recompile the software from its source code and required software libraries (
                                <E T="03">e.g.,</E>
                                 software libraries called, invoked, or linked by the computer software source code that are necessary for the operation of the software);
                            </P>
                            <P>(B) Conduct required computer software testing and evaluation;</P>
                            <P>(C) Integrate and deploy computer programs on relevant hardware including developmental, operational, diagnostic, training, or simulation environments; and</P>
                            <P>(D) Sustain and support the software over its life cycle.</P>
                            <P>
                                (ii) 
                                <E T="03">Alternatives to delivery of source code and related software design details.</E>
                                 The assessment of life-cycle needs should consider alternatives to the delivery of source code and related software design details for privately developed computer software as necessary to meet the Government's needs, such as—
                            </P>
                            <P>(A) Technical data and computer software sufficient to implement a modular open system approach or a similar approach (see PGI 227.7203-2(b)(2)(ii)(A) for guidance on alternatives to source code and related software design details);</P>
                            <P>(B) Access to technical data or computer software, including access agreements for cloud-based or subscription-based software products or services; see PGI 227.7203-2(b)(2)(ii)(B) and (C) for guidance on use of access agreements to contractor source code and related software design details;</P>
                            <P>(C) Software support and maintenance provided directly from the contractor; or</P>
                            <P>(D) Other contracting or licensing mechanisms including priced options, specially negotiated licenses, direct licensing between contractors for qualifying second sources, data escrow agreements, deferred delivery solutions, and subscription agreements. See PGI 227.7203-2(b)(2)(ii)(D) for guidance on use of escrow agreements.</P>
                            <P>(3) When reviewing offers received in response to a solicitation or other request for computer software or computer software documentation, data managers must balance the original assessment of the Government's needs with prices offered.</P>
                            <P>(c) Contracting officers are responsible for ensuring that, wherever practicable, solicitations and contracts—</P>
                            <P>(1) Identify the types of computer software and the quantity of computer programs and computer software documentation to be delivered, any requirements for multiple users at one site or multiple site licenses, and the format and media in which the software or documentation will be delivered;</P>
                            <P>(2) Establish each type of computer software or computer software documentation to be delivered as a separate contract line item (this requirement may be satisfied by an exhibit to the contract);</P>
                            <P>(3) Identify the prices established for each separately priced deliverable item of computer software or computer software documentation under a fixed-price type contract;</P>
                            <P>(4) Include delivery schedules and acceptance criteria for each deliverable item;</P>
                            <P>(5) Specifically identify the place of delivery for each deliverable item; and</P>
                            <P>(6) Specify in the negotiated terms that any required other than commercial computer software, related recorded information, and associated license rights identified in the assessment of life-cycle needs in paragraph (b) of this section shall to the extent appropriate—</P>
                            <P>(i) Include computer software delivered in a digital format compatible with applicable computer programs on relevant system hardware;</P>
                            <P>(ii) Not rely on additional internal or external other than commercial or commercial technical data and software, unless such technical data or software is—</P>
                            <P>
                                (A) Included in the items to be delivered with license rights sufficient to meet the Government's needs; or
                                <PRTPAGE P="290"/>
                            </P>
                            <P>(B) Commercially available with license rights sufficient to meet the Government's needs; and</P>
                            <P>(iii) Include sufficient information, with license rights sufficient to meet the Government's needs, to support maintenance and understanding of interfaces and software version history when the negotiated terms do not allow for the inclusion of the external or additional other than commercial or commercial technical data and software.</P>
                            <CITA>[60 FR 33482, June 28, 1995, as amended at 88 FR 17344, Mar. 22, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7203-3</SECTNO>
                            <SUBJECT>Early identification of computer software or computer software documentation to be furnished to the Government with restrictions on use, reproduction, or disclosure.</SUBJECT>
                            <P>(a) Use the provision at 252.227-7017, Identification and Assertion of Use, Release, or Disclosure Restrictions, in all solicitation that include the clause at 252.227-7014, Rights in Other Than Commercial Computer Software and Other Than Commercial Computer Software Documentation. The provision requires offerors to identify any computer software or computer software documentation for which restrictions, other than copyright, on use, modification, reproduction, release, performance, display, or disclosure are asserted and to attach the identification and assertion to the offer.</P>
                            <P>(b) Subsequent to contract award, the clause at 252.227-7014 permits a contractor, under certain conditions, to make additional assertions of restrictions. The prescriptions for the use of that clause and its alternates are at 227.7203-6(a).</P>
                            <CITA>[60 FR 33482, June 28, 1995, as amended at 88 FR 6586, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7203-4</SECTNO>
                            <SUBJECT>License rights.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Grant of license.</E>
                                 The Government obtains rights in computer software or computer software documentation, including a copyright license, under an irrevocable license granted or obtained by the contractor which developed the software or documentation or the licensor of the software or documentation if the development contractor is not the licensor. The contractor or licensor retains all rights in the software or documentation not granted to the Government. The scope of a computer software license is generally determined by the source of funds used to develop the software. Contractors or licensors may, with some exceptions, restrict the Government's rights to use, modify, reproduce, release, perform, display, or disclose computer software developed exclusively or partially at private expense (see 227.7203-5 (b) and (c)). They may not, without the Government's agreement (see 227.7203-5(d)), restrict the Government's rights in computer software developed exclusively with Government funds or in computer software documentation required to be delivered under a contract.
                            </P>
                            <P>
                                (b) 
                                <E T="03">Source of funds determination.</E>
                                 The determination of the source of funds used to develop computer software should be made at the lowest practicable segregable portion of the software or documentation (e.g., a software sub-routine that performs a specific function). Contractors may assert restricted rights in a segregable portion of computer software which otherwise qualifies for restricted rights under the clause at 252.227-7014, Rights in Other Than Commercial Computer Software and Other Than Commercial Computer Software Documentation.
                            </P>
                            <CITA>[60 FR 33482, June 28, 1995, as amended at 88 FR 6586, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7203-5</SECTNO>
                            <SUBJECT>Government rights.</SUBJECT>
                            <P>
                                The standard license rights in computer software that a licensor grants to the Government are unlimited rights, government purpose rights, or restricted rights. The standard license in computer software documentation conveys unlimited rights. Those rights are defined in the clause at 252.227-7014, Rights in Other Than Commercial Computer Software and Other Than Commercial Computer Software Documentation. In unusual situations, the standard rights may not satisfy the Government's needs or the Government may be willing to accept lesser rights in return for other consideration. In those cases, a special license may be negotiated. However, the licensor is 
                                <PRTPAGE P="291"/>
                                not obligated to provide the Government greater rights and the contracting officer is not required to accept lesser rights than the rights provided in the standard grant of license. The situations under which a particular grant of license applies are enumerated in paragraphs (a) through (d) of this section.
                            </P>
                            <P>
                                (a) 
                                <E T="03">Unlimited rights.</E>
                                 The Government obtains an unlimited rights license in—
                            </P>
                            <P>(1) Computer software developed exclusively with Government funds;</P>
                            <P>(2) Computer software documentation required to be delivered under a Government contract;</P>
                            <P>(3) Corrections or changes to computer software or computer software documentation furnished to the contractor by the Government;</P>
                            <P>(4) Computer software or computer software documentation that is otherwise publicly available or has been released or disclosed by the contractor or subcontractor without restrictions on further use, release or disclosure other than a release or disclosure resulting from the sale, transfer, or other assignment of interest in the software to another party or the sale or transfer of some or all of a business entity or it assets to another party;</P>
                            <P>(5) Computer software or computer software documentation obtained with unlimited rights under another Government contract or as a result of negotiations; or</P>
                            <P>(6) Computer software or computer software documentation furnished to the Government, under a Government contract or subcontract with—</P>
                            <P>(i) Restricted rights in computer software, limited rights in technical data, or government purpose license rights and the restrictive conditions have expired; or</P>
                            <P>(ii) Government purpose rights and the contractor's exclusive right to use such software or documentation for commercial purposes has expired.</P>
                            <P>
                                (b) 
                                <E T="03">Government purpose rights.</E>
                                 (1) Except as provided in paragraph (a) of this subsection, the Government obtains government purpose rights in computer software developed with mixed funding.
                            </P>
                            <P>(2) The period during which government purpose rights are effective is negotiable. The clause at 252.227-7014 provides a nominal five-year period. Either party may request a different period. Changes to the government purpose rights period may be made at any time prior to delivery of the software without consideration from either party. Longer periods should be negotiated when a five-year period does not provide sufficient time to commercialize the software or, for software developed by subcontractors, when necessary to recognize the subcontractors' interests in the software.</P>
                            <P>(3) The government purpose rights period commences upon execution of the contract, subcontract, letter contract (or similar contractual instrument), contract modification, or option exercise that required development of the computer software. Upon expiration of the government purpose rights period, the Government has unlimited rights in the software including the right to authorize others to use data for commercial purposes.</P>
                            <P>(4) During the government purpose rights period, the Government may not use, or authorize other persons to use, computer software marked with government purpose rights legends for commercial purposes. The Government shall not release or disclose, or authorize others to release or disclose, computer software in which it has government purpose rights to any person unless—</P>
                            <P>(i) Prior to release or disclosure, the intended recipient is subject to the use and non-disclosure agreement at 227.7103-7; or</P>
                            <P>(ii) The intended recipient is a Government contractor receiving access to the software for performance of a Government contract that contains the clause at 252.227-7025, Limitations on the Use or Disclosure of Government-Furnished Information Marked with Restrictive Legends.</P>
                            <P>
                                (5) When computer software marked with government purpose rights legends will be released or disclosed to a Government contractor performing a contract that does not include the clause at 252.227-7025, the contract may be modified, prior to release or disclosure, to include such clause in lieu of requiring the contractor to complete a use and non-disclosure agreement.
                                <PRTPAGE P="292"/>
                            </P>
                            <P>(6) Contracting activities shall establish procedures to assure that computer software or computer software documentation marked with government purpose rights legends are released or disclosed, including a release or disclosure through a Government solicitation, only to persons subject to the use and non-disclosure restrictions. Public announcements in the Commerce Business Daily or other publications must provide notice of the use and non-disclosure requirements. Class use and non-disclosure agreements (e.g., agreements covering all solicitations received by the XYZ company within a reasonable period) are authorized and may be obtained at any time prior to release or disclosure of the government purpose rights software or documentation. Documents transmitting government purpose rights software or documentation to persons under class agreements shall identify the specific software or documentation subject to government purpose rights and the class agreement under which such software or documentation are provided.</P>
                            <P>
                                (c) 
                                <E T="03">Restricted rights.</E>
                                 (1) The Government obtains restricted rights in other than commercial computer software, required to be delivered or otherwise provided to the Government under a contract, that was developed exclusively at private expense.
                            </P>
                            <P>(2) Contractors are not required to provide the Government additional rights in computer software delivered or otherwise provided to the Government with restricted rights. When the Government has a need for additional rights, the Government must negotiate with the contractor to determine if there are acceptable terms for transferring such rights. List or describe all software in which the contractor has granted the Government additional rights in a license agreement made part of the contract (see paragraph (d) of this subsection). The license shall enumerate the specific additional rights granted to the Government.</P>
                            <P>
                                (d) 
                                <E T="03">Specifically negotiated license rights.</E>
                                 Negotiate specific licenses when the parties agree to modify the standard license rights granted to the Government or when the Government wants to obtain rights in computer software in which it does not have rights. When negotiating to obtain, relinquish, or increase the Government's rights in computer software, consider the planned software maintenance philosophy, anticipated time or user sharing requirements, and other factors which may have relevance for a particular procurement. If negotiating to relinquish rights in computer software documentation, consider the administrative burden associated with protecting documentation subject to restrictions from unauthorized release or disclosure. The negotiated license rights must stipulate the rights granted the Government to use, modify, reproduce, release, perform, display, or disclose the software or documentation and the extent to which the Government may authorize others to do so. Identify all negotiated rights in a license agreement made part of the contract.
                            </P>
                            <P>
                                (e) 
                                <E T="03">Rights in derivative computer software or computer software documentation.</E>
                                 The clause at 252.227-7014 protects the Government's rights in computer software, computer software documentation, or portions thereof that the contractor subsequently uses to prepare derivative software or subsequently embeds or includes in other software or documentation. The Government retains the rights it obtained under the development contract in the unmodified portions of the derivative software or documentation.
                            </P>
                            <CITA>[56 FR 36389, July 31, 1991, as amended at 76 FR 3537, Jan. 20, 2011; 88 FR 6586, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7203-6</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>
                                (a)(1) Use the clause at 252.227-7014, Rights in Other Than Commercial Computer Software and Other Than Commercial Computer Software Documentation, in solicitations and contracts when the successful offeror(s) will be required to deliver computer software or computer software documentation. Do not use the clause when the only deliverable items are technical data (other than computer software documentation), commercial computer software or commercial computer software documentation, commercial products, commercial services (see 227.7102-3), special works (see 
                                <PRTPAGE P="293"/>
                                227.7205), or contracts under the Small Business Innovation Research Program (see 227.7104). Except as provided in 227.7107-2, do not use the clause in architect-engineer and construction contracts.
                            </P>
                            <P>(2) Use the clause at 252.227-7014 with its Alternate I in research contracts when the contracting officer determines, in consultation with counsel, that public dissemination by the contractor would be—</P>
                            <P>(i) In the interest of the Government; and</P>
                            <P>(ii) Facilitated by the Government relinquishing its right to publish the work for sale, or to have others publish the work for sale on behalf of the Government.</P>
                            <P>(b) Use the clause at 252.227-7016, Rights in Bid or Proposal Information, in solicitations and contracts that include the clause at 252.227-7014.</P>
                            <P>(c) Use the clause at 252.227-7019, Validation of Asserted Restrictions—Computer Software, in solicitations and contracts that include the clause at 252.227-7014. The clause provides procedures for the validation of asserted restrictions on the Government's rights to use, release, or disclose computer software.</P>
                            <P>(d) Use the provision at 252.227-7025, Limitations on the Use or Disclosure of Government-Furnished Information Marked with Restrictive Legends, in solicitations and contracts when it is anticipated that the Government will provide the contractor (other than a litigation support contractor covered by 252.204-7014), for performance of its contract, computer software or computer software documentation marked with another contractor's restrictive legend(s).</P>
                            <P>(e) Use the provision at 252.227-7028, Technical Data or Computer Software Previously Delivered to the Government, in solicitations when the resulting contract will require the contractor to deliver computer software or computer software documentation. The provision requires offerors to identify any software or documentation specified in the solicitation as deliverable items that are the same or substantially the same as software or documentation which the offeror has delivered or is obligated to deliver, either as a contractor or subcontractor, under any other federal agency contract.</P>
                            <P>(f) Use the clause at 252.227-7037, Validation of Restrictive Markings on Technical Data, in solicitations and contracts that include the clause at 252.227-7014 when the contractor will be required to deliver other than commercial computer software documentation (technical data). The clause implements statutory requirements under 10 U.S.C. 3781-3786. Paragraph (e) of the clause contains information that must be included in a formal challenge.</P>
                            <CITA>[56 FR 36389, July 31, 1991, as amended at 76 FR 3537, Jan. 20, 2011; 79 FR 11340, Feb. 28, 2014; 87 FR 76994, Dec. 16, 2022; 88 FR 6586, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7203-8</SECTNO>
                            <SUBJECT>Deferred delivery and deferred ordering of computer software and computer software documentation.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Deferred delivery.</E>
                                 Use the clause at 252.227-7026, Deferred Delivery of Technical Data or Computer Software, when it is in the Government's interests to defer the delivery of computer software or computer software documentation. The clause permits the contracting officer to require the delivery of data identified as “deferred delivery” data or computer software at any time until two years after acceptance by the Government of all items (other than technical data or computer software) under the contract or contract termination, whichever is later. The obligation of subcontractors or suppliers to deliver such data expires two years after the date the prime contractor accepts the last item from the subcontractor or supplier for use in the performance of the contract. The contract must specify the computer software or computer software documentation that is subject to deferred delivery. The contracting officer shall notify the contractor sufficiently in advance of the desired delivery date for such software or documentation to permit timely delivery.
                            </P>
                            <P>
                                (b) 
                                <E T="03">Deferred ordering.</E>
                                 Use the clause at 252.227-7027, Deferred Ordering of Technical Data or Computer Software, when a firm requirement for software or documentation has not been established prior to contract award but there is a potential need for computer 
                                <PRTPAGE P="294"/>
                                software or computer software documentation. Under this clause the contracting officer may order any computer software or computer software documentation generated in the performance of the contract or any subcontract thereunder at any time until three years after acceptance of all items (other than technical data or computer software) under the contract or contract termination, whichever is later. The obligation of subcontractors to deliver such technical data or computer software expires three years after the date the contractor accepts the last item under the subcontract. When the software or documentation are ordered, the delivery dates shall be negotiated and the contractor compensated only for converting the software or documentation into the prescribed form, reproduction costs, and delivery costs.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7203-9</SECTNO>
                            <SUBJECT>Copyright.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Copyright license.</E>
                                 (1) The clause at 252.227-7014, Rights in Other Than Commercial Computer Software and Other Than Commercial Computer Software Documentation, requires a contractor to grant, or obtain for the Government license rights which permit the Government to reproduce the software or documentation, distribute copies, perform or display the software or documentation and, through the right to modify data, prepare derivative works. The extent to which the Government, and others acting on its behalf, may exercise these rights varies for each of the standard data rights licenses obtained under the clause. When non-standard license rights in computer software or computer software documentation will be negotiated, negotiate the extent of the copyright license concurrent with negotiations for the data rights license. Do not negotiate copyright licenses for computer software that provide less rights than the standard restricted rights in computer software license. For computer software documentation, do not negotiate a copyright license that provides less rights than the standard limited rights in technical data license.
                            </P>
                            <P>(2) The clause at 252.227-7013, Rights in Technical Data— Other Than Commercial Products and Commercial Services, does not permit a contractor to incorporate a third party's copyrighted software into a deliverable software item unless the contractor has obtained an appropriate license for the Government and, when applicable, others acting on the Government's behalf, or has obtained the contracting officer's written approval to do so. Grant approval to use third party copyrighted software in which the Government will not receive a copyright license only when the Government's requirements cannot be satisfied without the third party material or when the use of the third party material will result in cost savings to the Government which outweigh the lack of a copyright license.</P>
                            <P>
                                (b) 
                                <E T="03">Copyright considerations—special works.</E>
                                 See 227.7205 for copyright considerations when acquiring special works.
                            </P>
                            <CITA>[60 FR 33482, June 28, 1995, as amended at 88 FR 6586, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7203-10</SECTNO>
                            <SUBJECT>Contractor identification and marking of computer software or computer software documentation to be furnished with restrictive markings.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Identification requirements.</E>
                                 (1) The solicitation provision at 252.227-7017, Identification and Assertion of Use, Release, or Disclosure Restrictions, requires offerors to identify, prior to contract award, any computer software or computer software documentation that an offeror asserts should be provided to the Government with restrictions on use, modification, reproduction, release, or disclosure. This requirement does not apply to restrictions based solely on copyright. The notification and identification must be submitted as an attachment to the offer. If an offeror fails to submit the attachment or fails to complete the attachment in accordance with the requirements of the solicitation provision, such failure shall constitute a minor informality. Provide offerors an opportunity to remedy a minor informality in accordance with the procedures at FAR 14.405 or 15.306(a). An offeror's failure to correct an informality within the time prescribed by the contracting officer shall render the offer ineligible for award.
                                <PRTPAGE P="295"/>
                            </P>
                            <P>(2) The procedures for correcting minor informalities shall not be used to obtain information regarding asserted restrictions or an offeror's suggested asserted rights category. Questions regarding the justification for an asserted restriction or asserted rights category must be pursued in accordance with the procedures at 227.7203-13.</P>
                            <P>(3) The restrictions asserted by a successful offeror shall be attached to its contract unless, in accordance with the procedures at 227.7203-13, the parties have agreed that an asserted restriction is not justified. The contract attachment shall provide the same information regarding identification of the computer software or computer software documentation, the asserted rights category, the basis for the assertion, and the name of the person asserting the restrictions as required by paragraph (d) of the solicitation provision at 252.227-7017. Subsequent to contract award, the clause at 252.227-7014, Rights in Other Than Commercial Computer Software and Other Than Commercial Computer Software Documentation, permits a contractor to make additional assertions under certain conditions. The additional assertions must be made in accordance with the procedures and in the format prescribed by that clause.</P>
                            <P>(4) Neither the pre- or post-award assertions made by the contractor nor the fact that certain assertions are identified in the attachment to the contract, determine the respective rights of the parties. As provided at 227.7203-13, the Government has the right to review, verify, challenge and validate restrictive markings.</P>
                            <P>(5) Information provided by offerors in response to the solicitation provision at 252.227-7017 may be used in the source selection process to evaluate the impact on evaluation factors that may be created by restrictions on the Government's ability to use or disclose computer software or computer software documentation.</P>
                            <P>
                                (b) 
                                <E T="03">Contractor marking requirements.</E>
                                 The clause at 252.227-7014, Rights in Other Than Commercial Computer Software and Other Than Commercial Computer Software Documentation—
                            </P>
                            <P>(1) Requires a contractor who desires to restrict the Government's rights in computer software or computer software documentation to place restrictive markings on the software or documentation, provides instructions for the placement of the restrictive markings, and authorizes the use of certain restrictive markings. When it is anticipated that the software will or may be used in combat or situations which simulate combat conditions, do not permit contractors to insert instructions into computer programs that interfere with or delay operation of the software to display a restrictive rights legend or other license notice; and</P>
                            <P>(2) Requires a contractor to deliver, furnish, or otherwise provide to the Government any computer software or computer software documentation in which the Government has previously obtained rights with the Government's pre-existing rights in that software or documentation unless the parties have agreed otherwise or restrictions on the Government's rights to use, modify, produce, release, or disclose the software or documentation have expired. When restrictions are still applicable, the contractor is permitted to mark the software or documentation with the appropriate restrictive legend.</P>
                            <P>
                                (c) 
                                <E T="03">Unmarked computer software or computer software documentation.</E>
                                 (1) Computer software or computer software documentation delivered or otherwise provided under a contract without restrictive markings shall be presumed to have been delivered with unlimited rights and may be released or disclosed without restriction. To the extent practicable, if a contractor has requested permission (see paragraph (c)(2) of this subsection) to correct an inadvertent omission of markings, do not release or disclose the software or documentation pending evaluation of the request.
                            </P>
                            <P>
                                (2) A contractor may request permission to have appropriate legends placed on unmarked computer software or computer software documentation at its expense. The request must be received by the contracting officer within six months following the furnishing or delivery of such software or documentation, or any extension of that time approved by the contracting officer. The person making the request must—
                                <PRTPAGE P="296"/>
                            </P>
                            <P>(i) Identify the software or documentation that should have been marked;</P>
                            <P>(ii) Demonstrate that the omission of the marking was inadvertent, the proposed marking is justified and conforms with the requirements for the marking of computer software or computer software documentation contained in the clause at 252.227-7014; and</P>
                            <P>(iii) Acknowledge, in writing, that the Government has no liability with respect to any disclosure, reproduction, or use of the software or documentation made prior to the addition of the marking or resulting from the omission of the marking.</P>
                            <P>(3) Contracting officers should grant permission to mark only if the software or documentation were not distributed outside the Government or were distributed outside the Government with restrictions on further use or disclosure.</P>
                            <CITA>[60 FR 33482, June 28, 1995, as amended at 63 FR 55052, Oct. 14, 1998; 88 FR 6586, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7203-11</SECTNO>
                            <SUBJECT>Contractor procedures and records.</SUBJECT>
                            <P>(a) The clause at 252.227-7014, Rights in Other Than Commercial Computer Software and Other Than Commercial Computer Software Documentation, requires a contractor, and its subcontractors or suppliers that will deliver computer software or computer software documentation with other than unlimited rights, to establish and follow written procedures to assure that restrictive markings are used only when authorized and to maintain records to justify the validity of restrictive markings.</P>
                            <P>(b) The clause at 252.227-7019, Validation of Asserted Restrictions—Computer Software, requires contractors and their subcontractors or suppliers at any tier to maintain records sufficient to justify the validity of markings that assert restrictions on the use, modification, reproduction, release, performance, display, or disclosure of computer software.</P>
                            <CITA>[60 FR 33482, June 28, 1995, as amended at 88 FR 6587, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7203-12</SECTNO>
                            <SUBJECT>Government right to establish conformity of markings.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Nonconforming markings.</E>
                                 (1) Authorized markings are identified in the clause at 252.227-7014, Rights in Other Than Commercial Computer Software and Other Than Commercial Computer Software Documentation. All other markings are nonconforming markings. An authorized marking that is not in the form, or differs in substance, from the marking requirements in the clause at 252.227-7014 is also a nonconforming marking.
                            </P>
                            <P>(2) The correction of nonconforming markings on computer software is not subject to 252.227-7019, Validation of Asserted Restrictions—Computer Software, and the correction of nonconforming markings on computer software documentation (technical data) is not subject to 252.227-7037, Validation of Restrictive Markings on Technical Data. To the extent practicable, the contracting officer should return computer software or computer software documentation bearing nonconforming markings to the person who has placed the nonconforming markings on the software or documentation to provide that person an opportunity to correct or strike the nonconforming markings at that person's expense. If that person fails to correct the nonconformity and return the corrected software or documentation within 60 days following the person's receipt of the software or documentation, the contracting officer may correct or strike the nonconformity at the person's expense. When it is impracticable to return computer software or computer software documentation for correction, contracting officers may unilaterally correct any nonconforming markings at Government expense. Prior to correction, the software or documentation may be used in accordance with the proper restrictive marking.</P>
                            <P>
                                (b) 
                                <E T="03">Unjustified markings.</E>
                                 (1) An unjustified marking is an authorized marking that does not depict accurately restrictions applicable to the Government's use, modification, reproduction, release, or disclosure of the marked computer software or computer software documentation. For example, a restricted rights legend placed on computer software developed under 
                                <PRTPAGE P="297"/>
                                a Government contract either exclusively at Government expense or with mixed funding (situations under which the Government obtains unlimited or government purpose rights) is an unjustified marking.
                            </P>
                            <P>(2) Contracting officers have the right to review and challenge the validity of unjustified markings. However, at any time during performance of a contract and notwithstanding existence of a challenge, the contracting officer and the person who has asserted a restrictive marking may agree that the restrictive marking is not justified. Upon such agreement, the contracting officer may, at his or her election, either—</P>
                            <P>(i) Strike or correct the unjustified marking at that person's expense; or</P>
                            <P>(ii) Return the computer software or computer software documentation to the person asserting the restriction for correction at that person's expense. If the software or documentation are returned and that person fails to correct or strike the unjustified restriction and return the corrected software or documentation to the contracting officer within 60 days following receipt of the software or documentation, the unjustified marking shall be corrected or stricken at that person's expense.</P>
                            <CITA>[60 FR 33482, June 28, 1995, as amended at 88 FR 6587, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7203-13</SECTNO>
                            <SUBJECT>Government right to review, verify, challenge, and validate asserted restrictions.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">General.</E>
                                 An offeror's or contractor's assertion(s) of restrictions on the Government's rights to use, modify, reproduce, release, or disclose computer software or computer software documentation do not, by themselves, determine the extent of the Government's rights in such software or documentation. The Government may require an offeror or contractor to submit sufficient information to permit an evaluation of a particular asserted restriction and may challenge asserted restrictions when there are reasonable grounds to believe that an assertion is not valid.
                            </P>
                            <P>
                                (b) 
                                <E T="03">Requests for information.</E>
                                 Contracting officers should have a reason to suspect that an asserted restriction might not be correct prior to requesting information. When requesting information, provide the offeror or contractor the reason(s) for suspecting that an asserted restriction might not be correct. A need for additional license rights is not, by itself, a sufficient basis for requesting information concerning an asserted restriction. Follow the procedures at 227.7203-5(d) when additional license rights are needed but there is no basis to suspect that an asserted restriction might not be valid.
                            </P>
                            <P>
                                (c) 
                                <E T="03">Transacting matters directly with subcontractors.</E>
                                 The clause at 252.227-7019, Validation of Asserted Restrictions—Computer Software, obtains the contractor's agreement that the Government may transact matters under the clause directly with a subcontractor or supplier, at any tier, without creating or implying privity of contract. Contracting officers should permit a subcontractor or supplier to transact challenge and validation matters directly with the Government when—
                            </P>
                            <P>(1) A subcontractor's or supplier's business interests in its technical data would be compromised if the data were disclosed to a higher tier contractor.</P>
                            <P>(2) There is reason to believe that the contractor will not respond in a timely manner to a challenge and an untimely response would jeopardize a subcontractor's or supplier's right to assert restrictions; or</P>
                            <P>(3) Requested to do so by a subcontractor or supplier.</P>
                            <P>
                                (d) 
                                <E T="03">Challenging asserted restrictions</E>
                                —(1) 
                                <E T="03">Pre-award considerations.</E>
                                 The challenge procedures in the clause at 252.227-7019 could significantly delay competitive procurements. Therefore, avoid challenging asserted restrictions prior to a competitive contract award unless resolution of the assertion is essential for successful completion of the procurement.
                            </P>
                            <P>
                                (2) 
                                <E T="03">Computer software documentation.</E>
                                 Computer software documentation is technical data. Challenges to asserted restrictions on the Government's rights to use, modify, reproduce, release, perform, display, or disclose computer software documentation must be made in accordance with the clause at 252.227-7037, Validation of Restrictive Markings on Technical Data, 
                                <PRTPAGE P="298"/>
                                and the guidance at 227.7103-13. The procedures in the clause at 252.227-7037 implement requirements contained in 10 U.S.C. 3781-3786. Resolution of questions regarding the validity of asserted restrictions using the process described at 227.7103-12(b)(2) is strongly encouraged.
                            </P>
                            <P>
                                (3) 
                                <E T="03">Computer software.</E>
                                 (i) Asserted restrictions should be reviewed before acceptance of the computer software deliverable under a contract. The Government's right to challenge an assertion expires three years after final payment under the contract or three years after delivery of the software, whichever is later. Those limitations on the Government's challenge rights do not apply to software that is publicly available, has been furnished to the Government without restrictions, or has been otherwise made available without restrictions.
                            </P>
                            <P>(ii) Contracting officers must have reasonable grounds to challenge the current validity of an asserted restriction. Before challenging an asserted restriction, carefully consider all available information pertaining to the asserted restrictions. Resolution of questions regarding the validity of asserted restrictions using the process described at 227.7203-12(b)(2) is strongly encouraged. After consideration of the situations described in paragraph (c) of this subsection, contracting officers may request the person asserting a restriction to furnish a written explanation of the facts and supporting documentation for the assertion in sufficient detail to enable the contracting officer to determine the validity of the assertion. Additional supporting documentation may be requested when the explanation provided by that person does not, in the contracting officer's opinion, establish the validity of the assertion.</P>
                            <P>(iii) Assertions may be challenged whether or not supporting documentation was requested. Challenges must be in writing and issued to the person asserting the restriction.</P>
                            <P>
                                (4) 
                                <E T="03">Extension of response time.</E>
                                 The contracting officer, at his or her discretion, may extend the time for response contained in a challenge, as appropriate, if the contractor submits a timely written request showing the need for additional time to prepare a response.
                            </P>
                            <P>
                                (e) 
                                <E T="03">Validating or denying asserted restrictions.</E>
                                 (1) Contracting officers must promptly issue a final decision denying or sustaining the validity of each challenged assertion unless the parties have agreed on the disposition of the assertion. When a final decision denying the validity of an asserted restriction is made following a timely response to a challenge, the Government is obligated to continue to respect the asserted restrictions through final disposition of any appeal unless the agency head notifies the person asserting the restriction that urgent or compelling circumstances do not permit the Government to continue to respect the asserted restriction. See 252.227-7019(g) for restrictions applicable following a determination of urgent and compelling circumstances.
                            </P>
                            <P>(2) Only a contracting officer's final decision, or actions of an agency Board of Contract Appeals or a court of competent jurisdiction, that sustain the validity of an asserted restriction constitute validation of the restriction.</P>
                            <P>
                                (f) 
                                <E T="03">Multiple challenges to an asserted restriction.</E>
                                 When more than one contracting officer challenges an asserted restriction, the contracting officer who made the earliest challenge is responsible for coordinating the Government challenges. That contracting officer shall consult with all other contracting officers making challenges, verify that all challenges apply to the same asserted restriction and, after consulting with the contractor, subcontractor, or supplier asserting the restriction, issue a schedule that provides that person a reasonable opportunity to respond to each challenge.
                            </P>
                            <CITA>[56 FR 36389, July 31, 1991, as amended at 76 FR 58148, Sept. 20, 2011; 81 FR 65566, Sept. 23, 2016; 87 FR 76994, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7203-14</SECTNO>
                            <SUBJECT>Conformity, acceptance, and warranty of computer software and computer software documentation.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Computer software documentation.</E>
                                 Computer software documentation is technical data. See 227.7103-14 for appropriate guidance and statutory requirements.
                                <PRTPAGE P="299"/>
                            </P>
                            <P>
                                (b) 
                                <E T="03">Computer software</E>
                                —(1) 
                                <E T="03">Conformity and acceptance.</E>
                                 Solicitations and contracts requiring the delivery of computer software shall specify the requirements the software must satisfy to be acceptable. Contracting officers, or their authorized representatives, are responsible for determining whether computer software tendered for acceptance conforms to the contractual requirements. Except for nonconforming restrictive markings (follow the procedures at 227.7203-12(a) if nonconforming markings are the sole reason computer software tendered for acceptance fails to conform to contractual requirements), do not accept software that does not conform in all respects to applicable contractual requirements. Correction or replacement of nonconforming software, or an equitable reduction in contract price when correction or replacement of the nonconforming data is not practicable or is not in the Government's interests, shall be accomplished in accordance with—
                            </P>
                            <P>(i) The provisions of a contract clause providing for inspection and acceptance of deliverables and remedies for nonconforming deliverables; or</P>
                            <P>(ii) The procedures at FAR 46.407(c) through (g), if the contract does not contain an inspection clause providing remedies for nonconforming deliverables.</P>
                            <P>
                                (2) 
                                <E T="03">Warranties</E>
                                —(i) 
                                <E T="03">Weapon systems.</E>
                                 Computer software that is a component of a weapon system or major subsystem should be warranted as part of the weapon system warranty. Follow the procedures at 246.7.
                            </P>
                            <P>
                                (ii) 
                                <E T="03">Non-weapon systems.</E>
                                 Approval of the chief of the contracting office must be obtained to use a computer software warranty other than a weapon system warranty. Consider the factors at FAR 46.703 in deciding whether to obtain a computer software warranty. When approval for a warranty has been obtained, the clause at 252.246-7001, Warranty of Data, and its alternates, may be appropriately modified for use with computer software or a procurement specific clause may be developed.
                            </P>
                            <CITA>[56 FR 36389, July 31, 1991, as amended at 76 FR 3537, Jan. 20, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7203-15</SECTNO>
                            <SUBJECT>Subcontractor rights in computer software or computer software documentation.</SUBJECT>
                            <P>(a) Subcontractors and suppliers at all tiers should be provided the same protection for their rights in computer software or computer software documentation as are provided to prime contractors.</P>
                            <P>(b) The clauses at 252.227-7019, Validation of Asserted Restrictions—Computer Software, and 252.227-7037, Validation of Restrictive Markings on Technical Data, obtain a contractor's agreement that the Government's transaction of validation or challenge matters directly with subcontractors at any tier does not establish or imply privity of contract. When a subcontractor or supplier exercises its right to transact validation matters directly with the Government, contracting officers shall deal directly with such persons, as provided at 227.7203-13(c) for computer software and 227.7103-13(c)(3) for computer software documentation (technical data).</P>
                            <P>(c) Require prime contractors whose contracts include the following clauses to include those clauses, without modification except for appropriate identification of the parties, in contracts with subcontractors or suppliers who will be furnishing computer software in response to a Government requirement (see 227.7103-15(c) for clauses required when subcontractors or suppliers will be furnishing computer software documentation (technical data)):</P>
                            <P>(1) 252.227-7014, Rights in Other Than Commercial Computer Software and Other Than Commercial Computer Software Documentation;</P>
                            <P>(2) 252.227-7019, Validation of Asserted Restrictions—Computer Software;</P>
                            <P>(3) 252.227-7025, Limitations on the Use or Disclosure of Government Furnished Information Marked with Restrictive Legends; and</P>
                            <P>(4) 252.227-7028, Technical Data or Computer Software Previously Delivered to the Government.</P>
                            <P>
                                (d) Do not require contractors to have their subcontractors or suppliers at any tier relinquish rights in technical data to the contractor, a higher tier subcontractor, or to the Government, as a condition for award of any 
                                <PRTPAGE P="300"/>
                                contract, subcontract, purchase order, or similar instrument except for the rights obtained by the Government under the provisions of the Rights in Other Than Commercial Computer Software and Other Than Commercial Computer Software Documentation clause contained in the contractor's contract with the Government.
                            </P>
                            <CITA>[56 FR 36389, July 31, 1991, as amended at 76 FR 76320, Dec. 7, 2011; 88 FR 6587, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7203-16</SECTNO>
                            <SUBJECT>Providing computer software or computer software documentation to foreign governments, foreign contractors, or international organizations.</SUBJECT>
                            <P>Computer software or computer software documentation may be released or disclosed to foreign governments, foreign contractors, or international organizations only if release or disclosure is otherwise permitted both by Federal export controls and other national security laws or regulations. Subject to such laws and regulations, the Department of Defense—</P>
                            <P>(a) May release or disclose computer software or computer software documentation in which it has obtained unlimited rights to such foreign entities or authorize the use of such data by those entities; and</P>
                            <P>(b) Shall not release or disclose computer software or computer software documentation for which restrictions on use, release, or disclosure have been asserted to such foreign entities or authorize the use of such data by those entities, unless the intended recipient is subject to the same provisions as included in the use and non-disclosure agreement at 227.7103-7 and the requirements of the clause at 252.227-7014, Rights in Other Than Commercial Computer Software and Other Than Commercial Computer Software Documentation, governing use, modification, reproduction, release, performance, display, or disclosure of such data have been satisfied.</P>
                            <CITA>[60 FR 33482, June 28, 1995, as amended at 88 FR 6587, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7203-17</SECTNO>
                            <SUBJECT>Overseas contracts with foreign sources.</SUBJECT>
                            <P>(a) The clause at 252.227-7032, Rights in Technical Data and Computer Software (Foreign), may be used in contracts with foreign contractors to be performed overseas, except Canadian purchases (see paragraph (c) of this subsection) in lieu of the clause at 252.227-7014, Rights in Other Than Commercial Computer Software and Other Than Commercial Computer Software Documentation, when the Government requires the unrestricted right to use, modify, reproduce, release, perform, display, or disclose all computer software or computer software documentation to be delivered under the contract. Do not use the clause in contracts for special works.</P>
                            <P>(b) When the Government does not require unlimited rights, the clause at 252.227-7032 may be modified to accommodate the needs of a specific overseas procurement situation. The Government should obtain rights to the computer software or computer software documentation that are not less than the rights the Government would have obtained under the software rights clause(s) prescribed in this part for a comparable procurement performed within the United States or its outlying areas.</P>
                            <P>(c) Contracts for Canadian purchases shall include the appropriate software rights clause prescribed in this part for a comparable procurement performed within the United States or its outlying areas.</P>
                            <CITA>[56 FR 36389, July 31, 1991, as amended at 70 FR 35545, June 21, 2005; 88 FR 6587, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7204</SECTNO>
                            <SUBJECT>Contracts under the Small Business Innovation Research Program.</SUBJECT>
                            <P>When contracting under the Small Business Innovation Research Program, follow the procedures at 227-7104.</P>
                            <CITA>[56 FR 36389, July 31, 1991, as amended at 76 FR 3537, Jan. 20, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7205</SECTNO>
                            <SUBJECT>Contracts for special works.</SUBJECT>
                            <P>
                                (a) Use the clause at 252.227-7020, Rights in Special Works, in solicitations and contracts where the Government has a specific need to control the distribution of computer software or computer software documentation first produced, created, or generated in the performance of a contract and required 
                                <PRTPAGE P="301"/>
                                to be delivered under that contract, including controlling distribution by obtaining an assignment of copyright, or a specific need to obtain indemnity for liabilities that may arise out of the creation, delivery, use, modification, reproduction, release, performance, display, or disclosure of such software or documentation. Use the clause—
                            </P>
                            <P>(1) In lieu of the clause at 252.227-7014, Rights in Other Than Commercial Computer Software and Other Than Commercial Computer Software Documentation, when the Government must own or control copyright in all computer software or computer software documentation first produced, created, or generated and required to be delivered under a contract; or</P>
                            <P>(2) In addition to the clause at 252.227-7014 when the Government must own or control copyright in some of the computer software or computer software documentation first produced, created, or generated and required to be delivered under a contract. The specific software or documentation in which the Government must own or control copyright must be identified in a special contract requirement.</P>
                            <P>(b) Although the Government obtains an assignment of copyright and unlimited rights in the computer software or computer software documentation delivered as a special work under the clause at 252.227-7020, the contractor retains use and disclosure rights in that software or documentation. If the Government needs to restrict a contractor's rights to use or disclose a special work, it must also negotiate a special license which specifically restricts the contractor's use or disclosure rights.</P>
                            <P>(c) The clause at 252.227-7020 does not permit a contractor to incorporate into a special work any work copyrighted by others unless the contractor obtains the contracting officer's permission to do so and obtains for the Government a non-exclusive, paid up, world-wide license to make and distribute copies of that work, to prepare derivative works, to perform or display any portion of that work, and to permit others to do so for government purposes. Grant permission only when the Government's requirements cannot be satisfied unless the third party work is included in the deliverable work.</P>
                            <P>(d) Examples of other works which may be procured under the clause at 252.227-7020 include, but are not limited to, audiovisual works, scripts, soundtracks, musical compositions, and adaptations; histories of departments, agencies, services or units thereof; surveys of Government establishments; instructional works or guidance to Government officers and employees on the discharge of their official duties; reports, books, studies, surveys or similar documents; collections of data containing information pertaining to individuals that, if disclosed, would violate the right of privacy or publicity of the individuals to whom the information relates; or investigative reports.</P>
                            <CITA>[60 FR 33482, June 28, 1995, as amended at 88 FR 6587, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7206</SECTNO>
                            <SUBJECT>Contracts for architect-engineer services.</SUBJECT>
                            <P>Follow 227.7107 when contracting for architect-engineer services.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>227.7207</SECTNO>
                            <SUBJECT>Contractor data repositories.</SUBJECT>
                            <P>Follow 227.7108 when it is in the Government's interests to have a data repository include computer software or to have a separate computer software repository. Contractual instruments establishing the repository requirements must appropriately reflect the repository manager's software responsibilities.</P>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 228</EAR>
                    <HD SOURCE="HED">PART 228—BONDS AND INSURANCE</HD>
                    <CONTENTS>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 228.1—Bonds and Other Financial Protections</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>228.102</SECTNO>
                            <SUBJECT>Performance and payment bonds and alternative payment protections for construction contracts.</SUBJECT>
                            <SECTNO>228.102-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>228.102-70</SECTNO>
                            <SUBJECT>Defense Environmental Restoration Program construction contract.</SUBJECT>
                            <SECTNO>228.105</SECTNO>
                            <SUBJECT>Other types of bonds.</SUBJECT>
                            <SECTNO>228.106</SECTNO>
                            <SUBJECT>Administration.</SUBJECT>
                            <SECTNO>228.106-7</SECTNO>
                            <SUBJECT>Withholding contract payments.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 228.3—Insurance</HD>
                            <SECTNO>228.304</SECTNO>
                            <SUBJECT>Risk-pooling arrangements.</SUBJECT>
                            <SECTNO>228.305</SECTNO>
                            <SUBJECT>
                                Overseas workers' compensation and war-hazard insurance.
                                <PRTPAGE P="302"/>
                            </SUBJECT>
                            <SECTNO>228.307</SECTNO>
                            <SUBJECT>Insurance under cost-reimbursement contracts.</SUBJECT>
                            <SECTNO>228.307-1</SECTNO>
                            <SUBJECT>Group insurance plans.</SUBJECT>
                            <SECTNO>228.311</SECTNO>
                            <SUBJECT>Solicitation provision and contract clause on liability insurance under cost-reimbursement contracts.</SUBJECT>
                            <SECTNO>228.311-1</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <SECTNO>228.370</SECTNO>
                            <SUBJECT>Ground and flight risk.</SUBJECT>
                            <SECTNO>228.370-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>228.370-2</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>228.370-3</SECTNO>
                            <SUBJECT>Aircraft not owned by or to be delivered to the Government.</SUBJECT>
                            <SECTNO>228.371</SECTNO>
                            <SUBJECT>Additional clauses.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36404, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 228.1—Bonds and Other Financial Protections</HD>
                        <SECTION>
                            <SECTNO>228.102</SECTNO>
                            <SUBJECT>Performance and payment bonds and alternative payment protections for construction contracts.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>228.102-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>The requirement for performance and payment bonds is waived for cost-reimbursement contracts. However, for cost-type contracts with fixed-price construction subcontracts over $40,000, require the prime contractor to obtain from each of its construction subcontractors performance and payment protections in favor of the prime contractor as follows:</P>
                            <P>(1) For fixed-price construction subcontracts over $40,000, but not exceeding $150,000, payment protection sufficient to pay labor and material costs, using any of the alternatives listed at FAR 28.102-1(b)(1).</P>
                            <P>(2) For fixed-price construction subcontracts over $150,000—</P>
                            <P>(i) A payment bond sufficient to pay labor and material costs; and</P>
                            <P>(ii) A performance bond in an equal amount if available at no additional cost.</P>
                            <CITA>[68 FR 36945, June 20, 2003, as amended at 71 FR 75892, Dec. 19, 2006; 75 FR 45074, Aug. 2, 2010; 80 FR 36904, June 26, 2015; 85 FR 61504, Sept. 29, 2020]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>228.102-70</SECTNO>
                            <SUBJECT>Defense Environmental Restoration Program construction contracts.</SUBJECT>
                            <P>For Defense Environmental Restoration Program construction contracts entered into pursuant to 10 U.S.C. 2701—</P>
                            <P>(a) Any rights of action under the performance bond shall only accrue to, and be for the exclusive use of, the obligee named in the bond;</P>
                            <P>(b) In the event of default, the surety's liability on the performance bond is limited to the cost of completion of the contract work, less the balance of unexpended funds. Under no circumstances shall the liability exceed the penal sum of the bond;</P>
                            <P>(c) The surety shall not be liable for indemnification or compensation of the obligee for loss or liability arising from personal injury or property damage, even if the injury or damage was caused by a breach of the bonded contract; and</P>
                            <P>(d) Once it has taken action to meet its obligations under the bond, the surety is entitled to any indemnification and identical standard of liability to which the contractor was entitled under the contract or applicable laws and regulations.</P>
                            <CITA>[68 FR 36945, June 20, 2003]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>228.105</SECTNO>
                            <SUBJECT>Other types of bonds.</SUBJECT>
                            <P>Fidelity and forgery bonds generally are not required but are authorized for use when—</P>
                            <P>(1) Necessary for the protection of the Government or the contractor; or</P>
                            <P>(2) The investigative and claims services of a surety company are desired.</P>
                            <CITA>[70 FR 8538, Feb. 22, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>228.106</SECTNO>
                            <SUBJECT>Administration.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>228.106-7</SECTNO>
                            <SUBJECT>Withholding contract payments.</SUBJECT>
                            <P>(a) Withholding may be appropriate in other than construction contracts (see FAR 32.112-1(b)).</P>
                            <CITA>[57 FR 42707, Sept. 16, 1992, as amended at 70 FR 8538, Feb. 22, 2005]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 228.3—Insurance</HD>
                        <SECTION>
                            <SECTNO>228.304</SECTNO>
                            <SUBJECT>Risk-pooling arrangements.</SUBJECT>
                            <P>
                                DoD has established the National Defense Projects Rating Plan, also known 
                                <PRTPAGE P="303"/>
                                as the Special Casualty Insurance Rating Plan, as a risk-pooling arrangement to minimize the cost to the Government of purchasing the liability insurance listed in FAR 28.307-2. Use the plan in accordance with the procedures at PGI 228.304 when it provides the necessary coverage more advantageously than commercially available coverage.
                            </P>
                            <CITA>[69 FR 65091, Nov. 10, 2004]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>228.305</SECTNO>
                            <SUBJECT>Overseas workers' compensation and war-hazard insurance.</SUBJECT>
                            <P>(d) When submitting requests for waiver, follow the procedures at PGI 228.305(d).</P>
                            <CITA>[69 FR 65091, Nov. 10, 2004]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>228.307</SECTNO>
                            <SUBJECT>Insurance under cost-reimbursement contracts.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>228.307-1</SECTNO>
                            <SUBJECT>Group insurance plans.</SUBJECT>
                            <P>The Defense Department Group Term Insurance Plan is available for contractor use under cost-reimbursement type contracts when approved as provided in department or agency regulations. A contractor is eligible if—</P>
                            <P>(a) The number of covered employees is 500 or more; and</P>
                            <P>(b) The contractor has all cost-reimbursement contracts; or</P>
                            <P>(c) At least 90 percent of the payroll for contractor operations to be covered by the Plan is under cost-reimbursement contracts.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>228.311</SECTNO>
                            <SUBJECT>Solicitation provision and contract clause on liability insurance under cost-reimbursement contracts.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>228.311-1</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at FAR 52.228-7, Insurance—Liability to Third Persons, in solicitations and contracts, other than those for construction and those for architect-engineer services, when a cost-reimbursement contract is contemplated, unless the head of the contracting activity waives the requirement for use of the clause.</P>
                            <CITA>[56 FR 36404, July 31, 1991. Redesignated at 61 FR 50454, Sept. 26, 1996]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>228.370</SECTNO>
                            <SUBJECT>Ground and flight risk.</SUBJECT>
                        </SECTION>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>88 FR 17349, Mar. 22, 2023, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>228.370-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this section—</P>
                            <P>
                                <E T="03">Aircraft</E>
                                 means, unless otherwise provided in the contract Schedule, any item, other than a rocket or missile, intended for flight (
                                <E T="03">e.g.,</E>
                                 fixed-winged aircraft, blended wing/lifting bodies, helicopters, vertical take-off or landing aircraft, lighter-than-air airships, and unmanned aerial vehicles), including emerging technologies that would commonly be considered aircraft. New production articles become aircraft at a stage of manufacture or production when a wing, portion of a wing, or engine is attached to a fuselage. Blended wing/lifting bodies become aircraft at a stage of manufacture or production when the center portion and a lifting surface become attached.
                            </P>
                            <P>
                                <E T="03">Civil aircraft</E>
                                 means an aircraft other than a public aircraft or state aircraft.
                            </P>
                            <P>
                                <E T="03">Contractor managerial personnel</E>
                                 means the contractor's directors, officers, managers, superintendents, or equivalent representatives who have supervision or direction of—
                            </P>
                            <P>(1) All, or substantially all, of the contractor's business;</P>
                            <P>(2) All, or substantially all, of the contractor's operation at any one plant or separate location; or</P>
                            <P>(3) A separate and complete major industrial operation.</P>
                            <P>
                                <E T="03">Covered aircraft</E>
                                 means an aircraft owned by or to be delivered to the Government and, when determined by the contracting officer and specifically identified as such in the contract Schedule, may include contractor-furnished aircraft that are not intended for induction into the DoD inventory, including—
                            </P>
                            <P>(1) Aircraft furnished by the Government to the contractor under a contract while in the contractor's possession, care, custody, or control regardless of their location or state of disassembly or reassembly;</P>
                            <P>(2) Items removed from a Government-furnished aircraft that are—</P>
                            <P>(i) Intended for reinstallation on that particular aircraft, which retain their status as covered aircraft while awaiting installation; and</P>
                            <P>
                                (ii) Not intended for reinstallation on that particular aircraft, which lose their status as covered aircraft once removal is complete;
                                <PRTPAGE P="304"/>
                            </P>
                            <P>
                                (3) New production aircraft when wholly outside of buildings on the contractor's premises or other places described in the contract Schedule (
                                <E T="03">e.g.,</E>
                                 hush houses, run stations, and paint facilities); and
                            </P>
                            <P>(4) Commercial aircraft, to include commercially available off-the-shelf aircraft, become covered aircraft when the commercial aircraft arrives at the contractor's place of performance for modification under the terms of the contract.</P>
                            <P>
                                <E T="03">Crewmember</E>
                                 means, unless otherwise provided in the contract Schedule, personnel required in the flight manual, assigned for the purpose of conducting any flight on behalf of the contractor. It also includes any operator of an unmanned aerial vehicle.
                            </P>
                            <P>
                                <E T="03">Flight</E>
                                 means any flight approved in writing by the Government flight representative, to include taxi test made in the performance of the contract, or flight for the purpose of safeguarding the aircraft. All aircraft off the contractor's premises shall be considered to be in flight when on the ground or water for reasonable periods of time following emergency landings, landings made in performance of the contract, or landings approved in writing by the contracting officer.
                            </P>
                            <P>
                                <E T="03">Public aircraft</E>
                                 means an aircraft that meets the definition in 49 U.S.C. 40102(a)(41) and the qualifications in 49 U.S.C. 40125. Specifically, a public aircraft means any of the following:
                            </P>
                            <P>(1) An aircraft used only for the Government, except as provided in paragraphs (5) and (7) of this definition.</P>
                            <P>(2) An aircraft owned by the Government and operated by any person for purposes related to crew training, equipment development, or demonstration, except as provided in paragraph (7) of this definition.</P>
                            <P>(3) An aircraft owned and operated by the government of a State, the District of Columbia, or a territory or possession of the United States or a political subdivision of one of these governments, except as provided in paragraph (7) of this definition.</P>
                            <P>(4) An aircraft exclusively leased for at least 90 continuous days by the government of a State, the District of Columbia, or a territory or possession of the United States or a political subdivision of one of these governments, except as provided in paragraph (7) of this definition.</P>
                            <P>(5) An aircraft owned or operated by the armed forces or chartered to provide transportation or other commercial air service to the armed forces under the conditions specified by 49 U.S.C. 40125(c). In the preceding sentence, the term “other commercial air service” means an aircraft operation that—</P>
                            <P>(i) Is within the United States territorial airspace;</P>
                            <P>(ii) The Administrator of the Federal Aviation Administration determines is available for compensation or hire to the public; and</P>
                            <P>(iii) Must comply with all applicable civil aircraft rules under title 14, Code of Federal Regulations.</P>
                            <P>(6) An unmanned aircraft that is owned and operated by, or exclusively leased for at least 90 continuous days by, an Indian Tribal government, as defined in section 102 of the Robert T. Stafford Disaster Relief and Emergency Assistance Act (42 U.S.C. 5122), except as provided in paragraph (7) of this definition.</P>
                            <P>(7) As described in 49 U.S.C. 40125(b), an aircraft described in paragraph (1), (2), (3), or (4) of this definition does not qualify as a public aircraft in situations where the aircraft is used for commercial purposes or to carry an individual other than a crewmember or a qualified non-crewmember.</P>
                            <P>
                                <E T="03">Public aircraft operation</E>
                                 means operation of an aircraft that meets the legal definition of public aircraft established in 49 U.S.C. 40102(a)(41) and the legal qualifications for public aircraft status outlined in 49 U.S.C. 40125.
                            </P>
                            <P>
                                <E T="03">State aircraft</E>
                                 means an aircraft operated by the Government for sovereign, noncommercial purposes such as military, customs, and police services. Military aircraft are afforded status as state aircraft. In very rare circumstances, DoD-contracted aircraft may be designated, in writing, by a responsible Government official pursuant to DoD Directive 4500.54E, DoD Foreign Clearance Program, to be operated in state aircraft status, and States may choose to treat them as deemed state aircraft when they are operating under a Government contract.
                                <PRTPAGE P="305"/>
                            </P>
                            <P>
                                <E T="03">Workmanship error</E>
                                 means damage to the aircraft that is the result of an incorrectly performed skill-based task, operation, or action that was originally planned or intended.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>228.370-2</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Assignment of a Government flight representative.</E>
                                 See PGI 228.370-2(a) for procedures on assigning a Government flight representative (GFR) when using the clauses at 252.228-7001 and 252.228-7007.
                            </P>
                            <P>
                                (b) 
                                <E T="03">Preaward survey.</E>
                                 Before awarding any contract using the clause at 252.228-7001, Ground and Flight Risk, the contracting officer should obtain a preaward survey of the offeror's proposed aircraft flight and ground operations facility. If the offeror proposed subcontracting any aircraft work, the preaward survey should include a review of the subcontractor's facility. For acquisitions falling under the exceptions at 228.371(b)(1)(iii), (iv), and (vi), the contracting officer shall review the documentation the offeror submitted with the proposal in response to the DD Form 1423, Contract Data Requirements List, to ensure the offeror's commercial insurance provides the appropriate coverage required by the clause at 252.228-7001.
                            </P>
                            <P>
                                (c) 
                                <E T="03">Foreign military sales.</E>
                                 The exception for foreign military sales (FMS) contracts at 228.371(b)(1)(iii) only applies to FMS cases where the FMS customer has explicitly refused assumption of risk of loss. If the FMS customer has accepted the standard Letter of Offer and Acceptance Standard Terms and Conditions, as described in DoD 5105.38-M, Security Assistance Management Manual, they have assumed risk of loss.
                            </P>
                            <P>
                                (d) 
                                <E T="03">Commercial derivative aircraft.</E>
                                 The exception at 228.371(b)(1)(iv) for commercial derivative aircraft only applies if the contractor is a licensed and certified Federal Aviation Administration (FAA) repair station for the specific model of aircraft under contract, when work is being performed pursuant to the FAA license under 14 CFR part 145. The FAA's repair station search tool is available at 
                                <E T="03">https://av-info.faa.gov/repairstation.asp.</E>
                                 All aircraft flying public aircraft operations operate under airworthiness certificates maintained by the military services. The FAA airworthiness certificate in the exception in this paragraph (d) underlies the military service certificate.
                            </P>
                            <P>
                                (e) 
                                <E T="03">Insurance.</E>
                                 The clause at 252.228-7001, Ground and Flight Risk, is intended to reduce acquisition costs by eliminating the costs of commercial insurance premiums. This clause also is intended to encourage the contractor to perform safe and effective operations through inclusion of a contractor's share of loss (
                                <E T="03">i.e.,</E>
                                 a deductible). Additionally, the clause requires compliance with the combined regulation/instruction entitled “Contractor's Flight and Ground Operations” (Air Force Instruction 10-220, Army Regulation 95-20, Naval Air Systems Command (NAVAIR) Instruction 3710.1 (Series), Coast Guard Instruction M13020.3 (Series), and Defense Contract Management Agency Instruction 8210-1 (Series)), which provides procedures to mitigate the risk of loss to the Government. For this reason, paragraph (e)(4)(ii) of the clause at 252.228-7001 specifies that insurance premium costs are unallowable. In addition, paragraph (d)(4) of the clause provides that the Government's assumption of risk does not apply where the loss or damage is covered by available insurance.
                            </P>
                            <P>
                                (f) 
                                <E T="03">Damage to Government aircraft.</E>
                                 (1) Whenever damage to Government aircraft is reported, each incident should be evaluated on its own merits. When the cost of repair exceeds the contractor's share of loss provisions, the contracting officer shall make a liability determination in accordance with paragraph (g) of this section.
                            </P>
                            <P>(2) Contracting officers should consult with the requiring activity and the assigned contract administration office on replacement, repair, or beyond economic repair decisions.</P>
                            <P>(3) See PGI 228.370-2(f) for an example of accident or mishap damage versus workmanship-error damage.</P>
                            <P>
                                (g) 
                                <E T="03">Contracting officer determination of liability.</E>
                                 (1) When making a liability determination, the contracting officer should seek input from the GFR and legal counsel, as needed.
                            </P>
                            <P>
                                (2) The Government's assumption of risk shall not extend to damage, loss, 
                                <PRTPAGE P="306"/>
                                or destruction of covered aircraft that—
                            </P>
                            <P>(i) Is the result of willful misconduct or lack of good faith on the part of the contractor's managerial personnel, including the contractor's oversight of subcontractors;</P>
                            <P>(ii) Is sustained during flight if either the flight or the crewmembers have not been approved in advance and in writing by the GFR, who has been authorized in accordance with the combined regulation/instruction entitled “Contractor's Flight and Ground Operations”;</P>
                            <P>(iii) Occurs in the course of transportation by rail, or by conveyance on public streets, highways, or waterways, unless the transportation is limited to the vicinity of the contractor's premises, and incidental to work performed under the contract as described in the Schedule;</P>
                            <P>(iv) Is covered by insurance;</P>
                            <P>(v) Occurs after the contracting officer has, in writing, revoked the Government's assumption of risk; or</P>
                            <P>(vi) Is sustained due to workmanship errors.</P>
                            <P>
                                (h) 
                                <E T="03">Notice of revocation of the Government's assumption of risk.</E>
                                 The liability provisions of the clause at FAR 52.245-1, Government Property, do not apply to the aircraft impacted by a notice of revocation.
                            </P>
                            <P>
                                (1) 
                                <E T="03">Preliminary notice of revocation.</E>
                                 (i) When finding that contractor managerial personnel have failed to comply with the combined regulation/instruction, as required by paragraph (b) of the clause at 252.228-7001, including finding the covered aircraft are exposed to unreasonable conditions, the contracting officer shall issue a preliminary notice of revocation of the Government's assumption of risk to the contractor and shall require the contractor to comply with contract requirements. Factors for the contracting officer to consider in determining exposure to unreasonable conditions include, but are not limited to, the following:
                            </P>
                            <P>(A) Lack of adequate hangar fire suppression or firefighting vehicles;</P>
                            <P>(B) Failure to provide adequate procedures to the GFR; or</P>
                            <P>(C) Systemic failure to comply with approved procedures.</P>
                            <P>(ii) The preliminary notice of revocation will state the timeframe for the contractor to correct the noncompliance or conditions.</P>
                            <P>
                                (2) 
                                <E T="03">Notice of revocation.</E>
                                 If the contractor fails to correct the cited noncompliance or conditions within the specified timeframe, the contracting officer shall issue to the contractor a notice of revocation of the Government's assumption of risk for any covered aircraft.
                            </P>
                            <P>(i) Thereafter the contractor assumes the entire risk for damage, loss, or destruction of the previously covered aircraft.</P>
                            <P>(ii) Any costs incurred by the contractor, including the costs of the contractor's self-insurance, insurance premiums paid to insure the contractor's assumption of risk, deductibles associated with such purchased insurance, etc., to mitigate its risk are unallowable costs.</P>
                            <P>(iii) The notice of revocation does not relieve the contractor of its obligation to comply with all other provisions of the clause at 252.228-7001, including the combined regulation/instruction entitled “Contractor's Flight and Ground Operations.”</P>
                            <P>(iv) Within 3 days of receipt of the contractor's notice of correction, the contracting officer shall notify the contractor whether the Government will resume risk of loss. The contracting officer shall determine that the noncompliance or cited conditions have been corrected prior to resuming assumption of risk.</P>
                            <P>(v) Any disputes regarding the contracting officer's notice of revocation shall be subject to FAR clause 52.233-1, Disputes.</P>
                            <P>
                                (i) 
                                <E T="03">Procedures in the event of damage, loss, or destruction of covered aircraft.</E>
                                 (1) In the event of damage, loss, or destruction of covered aircraft, except in cases covered by paragraph (j)(2) of this section, the contracting officer shall evaluate the contractor's statement of—
                            </P>
                            <P>(i) The damaged, lost, or destroyed aircraft;</P>
                            <P>(ii) The time and origin of the damage, loss, or destruction;</P>
                            <P>
                                (iii) All known interests in commingled property of which aircraft are a part; and
                                <PRTPAGE P="307"/>
                            </P>
                            <P>(iv) The insurance, if any, covering the interest in commingled property.</P>
                            <P>(2) If a new production aircraft is damaged, lost, or destroyed before it has become a covered aircraft, the Government bears no responsibility for risk of loss.</P>
                            <P>(3) If a new production aircraft is damaged, lost, or destroyed after it has become a covered aircraft, the contracting officer shall provide written direction to the contractor to take action in accordance with the contracting officer's written direction that the aircraft shall be—</P>
                            <P>(i) Replaced;</P>
                            <P>(ii) Repaired to the condition immediately prior to the damage; or</P>
                            <P>(iii) Considered beyond economic repair. The contracting officer shall decide whether further actions are required under the contract.</P>
                            <P>(4) If a covered aircraft that has been furnished by the Government to the contractor is damaged, lost, or destroyed while covered, the contracting officer shall provide written direction to the contractor that the aircraft shall be—</P>
                            <P>(i) Repaired; or</P>
                            <P>(ii) Considered beyond economic repair. The contracting officer shall decide further actions required under the contract.</P>
                            <P>(5) The contracting officer shall make an equitable adjustment for expenditures made in performing the obligations under paragraph (h) of the clause at 252.228-7001.</P>
                            <P>
                                (j) 
                                <E T="03">Contracting officer determination of the contractor's share of loss.</E>
                                 (1) The contractor's share of loss or damage to covered aircraft, except for loss or damage caused by negligence of Government personnel, is the least of—
                            </P>
                            <P>(i) $200,000;</P>
                            <P>(ii) 20 percent of the price or estimated acquisition cost of affected aircraft; or</P>
                            <P>(iii) 20 percent of the price or estimated cost of the contract, task order, or delivery order.</P>
                            <P>(2) If the Government requires covered aircraft to be replaced or repaired by the contractor, any resulting equitable adjustment shall not include reimbursement of the contractor's share of loss.</P>
                            <P>(3) In the event the Government does not decide to replace or repair the covered aircraft, the clause at 252.228-7001 requires the contractor to credit the contract price or pay the Government, as directed by the contracting officer, the least of—</P>
                            <P>(i) $200,000;</P>
                            <P>(ii) 20 percent of the price or estimated acquisition cost of affected aircraft; or</P>
                            <P>(iii) 20 percent of the price or estimated cost of the contract, task order, or delivery order.</P>
                            <P>(4) The costs incurred by the contractor for its share of the loss and for insuring against that loss are unallowable costs, including but not limited to—</P>
                            <P>(i) The contractor's share of loss under the Government's self-insurance;</P>
                            <P>(ii) The costs of the contractor's self-insurance;</P>
                            <P>(iii) The deductible for any contractor-purchased insurance;</P>
                            <P>(iv) Insurance premiums paid for contractor-purchased insurance; and</P>
                            <P>(v) Costs associated with determining, litigating, and defending against the contractor's liability.</P>
                            <P>
                                (k) 
                                <E T="03">Reimbursement from a third party.</E>
                                 If the contracting officer finds or has reason to believe that the contractor has been reimbursed or otherwise compensated by a third party for damage, loss, or destruction of covered aircraft and has also been compensated by the Government, then the contracting officer shall demand an equitable reimbursement. If the contracting officer requests that the contractor provide reasonable assistance in obtaining recovery, such effort shall be an allowable expense of the contractor.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>228.370-3</SECTNO>
                            <SUBJECT>Aircraft not owned by or to be delivered to the Government.</SUBJECT>
                            <P>(a) When a contract involves aircraft not owned by or to be delivered to the Government, the contracting officer may use the clause at 252.228-7001 only if the contracting officer determines that it is in the best interest of the Government.</P>
                            <P>
                                (b) Potential factors for the contracting officer to consider when deciding which course of action is in the best interest of the Government include, but are not limited to, whether—
                                <PRTPAGE P="308"/>
                            </P>
                            <P>(1) The cost of hull insurance exceeds the replacement cost of the aircraft;</P>
                            <P>
                                (2) Insurance is not available (
                                <E T="03">e.g.,</E>
                                 high-risk experimental flights and operations of aircraft in a war zone); or
                            </P>
                            <P>
                                (3) Ground or flight activities that involve contractor-owned and contractor-operated aircraft may pose risk to Government aircraft (
                                <E T="03">e.g.,</E>
                                 due to close proximity in flight).
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>228.371</SECTNO>
                            <SUBJECT>Additional clauses.</SUBJECT>
                            <P>(a) Use the clause at 252.228-7000, Reimbursement for War-Hazard Losses, when—</P>
                            <P>(1) The clause at FAR 52.228-4, Worker's Compensation and War-Hazard Insurance Overseas, is used; and</P>
                            <P>(2) The head of the contracting activity decides not to allow the contractor to buy insurance for war-hazard losses.</P>
                            <P>(b) Use the clause at 252.228-7001, Ground and Flight Risk, in solicitations and contracts—</P>
                            <P>(1) For the acquisition, development, production, modification, maintenance, repair, flight, or overhaul of aircraft owned by or to be delivered to the Government, except those solicitations and contracts—</P>
                            <P>
                                (i) That are strictly for activities incidental to the normal operations of the aircraft (
                                <E T="03">e.g.,</E>
                                 refueling operations, minor non-structural actions not requiring towing such as replacing aircraft tires due to wear and tear);
                            </P>
                            <P>(ii) That are awarded for purchase under FAR part 12 procedures;</P>
                            <P>(iii) For which a non-DoD customer (including an FMS customer per 225.7305) has decided to allow the use of commercial insurance or other self-insurance;</P>
                            <P>(iv) For commercial derivative aircraft with an FAA certificate of airworthiness maintained to FAA standards. Performance under the exception in this paragraph (b)(1)(iv) must be at a licensed and certified FAA repair station rated for the type of aircraft and work to be maintained. This exception does not apply to contracts requiring flights with contractor crewmembers;</P>
                            <P>(v) Under which the aircraft are to be dismantled and removed from the inventory; or</P>
                            <P>(vi) Under which the aircraft are classified as Group 1 or 2 unmanned aircraft systems per DoD Instruction (DoDI) 6055.07, Mishap Notification, Investigation, Reporting, and Record Keeping, and the purchase price of the air vehicle, including installed Government-furnished equipment, is below the cost threshold for a Class C mishap per DoDI 6055.07; or</P>
                            <P>(2) Involving aircraft not owned by or to be delivered to the Government, only if the contracting officer decides that it is in the best interest of the Government. See 228.370-3.</P>
                            <P>
                                (c) The clause at 252.228-7003, Capture and Detention, may be used when contractor employees are subject to capture and detention and may not be covered by the War Hazards Compensation Act (42 U.S.C. 1701 
                                <E T="03">et seq.</E>
                                ).
                            </P>
                            <P>(d) Use the clause at 252.228-7005, Mishap Reporting and Investigation Involving Aircraft, Missiles, and Space Launch Vehicles, in solicitations and contracts that involve the manufacture, modification, overhaul, or repair of aircraft, missiles, and space launch vehicles.</P>
                            <P>(e) Use the clause at 252.228-7006, Compliance with Spanish Laws and Insurance, in solicitations and contracts for services or construction to be performed in Spain, unless the contractor is a Spanish concern.</P>
                            <P>(f) Use the clause at 252.228-7007, Public Aircraft and State Aircraft Operations—Liability, in solicitations and contracts that do not include the clause at 252.228-7001 but involve public aircraft operations or state aircraft operations.</P>
                            <CITA>[56 FR 36404, July 31, 1991, as amended at 57 FR 42631, Sept. 15, 1992; 62 FR 34125, June 24, 1997; 63 FR 69006, Dec. 15, 1998; 75 FR 32644, June 8, 2010; 84 FR 65312, Nov. 27, 2019. Redesignated and amended at 88 FR 17349, Mar. 22, 2023; 88 FR 25512, Apr. 27, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 229</EAR>
                    <HD SOURCE="HED">PART 229—TAXES</HD>
                    <CONTENTS>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 229.1—General</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>229.101</SECTNO>
                            <SUBJECT>Resolving tax problems.</SUBJECT>
                            <SECTNO>229.170</SECTNO>
                            <SUBJECT>Reporting of foreign taxation on U.S. assistance programs.</SUBJECT>
                            <SECTNO>229.170-1</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <SECTNO>229.170-2</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>229.170-3</SECTNO>
                            <SUBJECT>Reports.</SUBJECT>
                            <SECTNO>229.170-4</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <PRTPAGE P="309"/>
                            <HD SOURCE="HED">Subpart 229.2—Federal Excise Taxes</HD>
                            <SECTNO>229.204</SECTNO>
                            <SUBJECT>Federal excise tax on specific foreign contract payments.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 229.4—Contract Clauses</HD>
                            <SECTNO>229.402</SECTNO>
                            <SUBJECT>Foreign contracts.</SUBJECT>
                            <SECTNO>229.402-70</SECTNO>
                            <SUBJECT>Additional provisions and clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <RESERVED>Subpart 229.70—Special Procedures for Overseas Contracts</RESERVED>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36405, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 229.1—General</HD>
                        <SECTION>
                            <SECTNO>229.101</SECTNO>
                            <SUBJECT>Resolving tax problems.</SUBJECT>
                            <P>(a) Within DoD, the agency-designated legal counsels are the defense agency General Counsels, the General Counsels of the Navy and Air Force, and for the Army, the Chief, Contract Law Division, Office of the Judge Advocate General. For additional information on the designated legal counsels, see PGI 229.101(a).</P>
                            <P>(b) For information on fuel excise taxes, see PGI 229.101(b).</P>
                            <P>(c) For guidance on directing a contractor to litigate the applicability of a particular tax, see PGI 229.101(c).</P>
                            <P>(d) For information on tax relief agreements between the United States and European foreign governments, see PGI 229.101(d).</P>
                            <CITA>[70 FR 8538, Feb. 22, 2005, as amended at 71 FR 14100, Mar. 21, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>229.170</SECTNO>
                            <SUBJECT>Reporting of foreign taxation on U.S. assistance programs.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>229.170-1</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <P>
                                <E T="03">Commodities,</E>
                                 as used in this section, means any materials, articles, supplies, goods, or equipment.
                            </P>
                            <CITA>[70 FR 57192, Sept. 30, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>229.170-2</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(a) By law, bilateral agreements with foreign governments must include a provision that commodities acquired under contracts funded by U.S. assistance programs shall be exempt from taxation by the foreign government. If taxes or customs duties nevertheless are imposed, the foreign government must reimburse the amount of such taxes to the U.S. Government (Section 579 of Division E of the Consolidated Appropriations Act, 2003 (Pub. L. 108-7), as amended by Section 506 of Division D of the Consolidated Appropriations Act, 2004 (Pub. L. 108-199), and similar sections in subsequent acts).</P>
                            <P>(b) This foreign tax exemption—</P>
                            <P>(1) Applies to a contract or subcontract for commodities when—</P>
                            <P>(i) The funds are appropriated by the annual foreign operations appropriations act; and</P>
                            <P>(ii) The value of the contract or subcontract is $500 or more;</P>
                            <P>(2) Does not apply to the acquisition of services;</P>
                            <P>(3) Generally is implemented through letters of offer and acceptance, other country-to-country agreements, or Federal interagency agreements; and</P>
                            <P>(4) Requires reporting of noncompliance for effective implementation.</P>
                            <CITA>[70 FR 57192, Sept. 30, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>229.170-3</SECTNO>
                            <SUBJECT>Reports.</SUBJECT>
                            <P>The contracting officer shall submit a report to the designated Security Assistance Office when a foreign government or entity imposes tax or customs duties on commodities acquired under contracts or subcontracts meeting the criteria of 229.170-2(b)(1). Follow the procedures at PGI 229.170-3 for submission of reports.</P>
                            <CITA>[70 FR 57192, Sept. 30, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>229.170-4</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at 252.229-7011, Reporting of Foreign Taxes—U.S. Assistance Programs, in solicitations and contracts funded with U.S. assistance appropriations provided in the annual foreign operations appropriations act.</P>
                            <CITA>[70 FR 57192, Sept. 30, 2005]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 229.2—Federal Excise Taxes</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>87 FR 65517, Oct. 28, 2022, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <PRTPAGE P="310"/>
                            <SECTNO>229.204</SECTNO>
                            <SUBJECT>Federal excise tax on specific foreign contract payments.</SUBJECT>
                            <P>The contracting officer shall not authorize the Governmentwide commercial purchase card as a method of payment during any contract period of performance if the contract includes the clause at FAR 52.229-12, Tax on Certain Foreign Procurements, unless the contract also includes the clause at 252.229-7014, Full Exemption from Two-Percent Excise Tax on Certain Foreign Procurements, indicating that the contractor is fully exempt from the tax.</P>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 229.4—Contract Clauses</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>62 FR 34125, June 24, 1997, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>229.402</SECTNO>
                            <SUBJECT>Foreign contracts.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>229.402-70</SECTNO>
                            <SUBJECT>Additional provisions and clauses.</SUBJECT>
                            <P>(a) Use the basic or the alternate of the clause at 252.229-7001, Tax Relief, in solicitations and contracts when a contract will be awarded to a foreign concern for performance in a foreign country.</P>
                            <P>(1) Use the basic clause in solicitations and contracts when the contract will be performed in a foreign country other than Germany.</P>
                            <P>(2) Use the alternate I clause in solicitations and contracts when the contract will be performed in Germany.</P>
                            <P>(b) Use the clause at 252.229-7002, Customs Exemptions (Germany), in solicitations and contracts requiring the import of U.S. manufactured products into Germany.</P>
                            <P>(c)(1) Use the clause at 252.229-7003, Tax Exemptions (Italy), in solicitations and contracts when contract performance will be in Italy.</P>
                            <P>(2) Use the provision at 252.229-7012, Tax Exemptions (Italy)—Representation, in solicitations that contain the clause at 252.229-7003, Tax Exemptions (Italy). If the solicitation includes the provision at FAR 52.204-7, do not separately list 252.229-7012 in the solicitation.</P>
                            <P>(d) Use the clause at 252.229-7004, Status of Contractor as a Direct Contractor (Spain), in solicitations and contracts requiring the import into Spain of supplies for construction, development, maintenance, or operation of Spanish-American installations and facilities.</P>
                            <P>(e)(1) Use the clause at 252.229-7005, Tax Exemptions (Spain). If the solicitation includes the provision at FAR 52.204-7, do not separately list 252.229-7013 in the solicitation., in solicitations and contracts when contract performance will be in Spain.</P>
                            <P>(2) Use the provision at 252.229-7013, Tax Exemptions (Spain)—Representation, in solicitations that contain the clause at 252.229-7005, Tax Exemptions (Spain).</P>
                            <P>(f) Use the clause at 252.229-7006, Value Added Tax Exclusion (United Kingdom), in solicitations and contracts when contract performance will be in the United Kingdom.</P>
                            <P>(g) Use the clause at 252.229-7007, Verification of United States Receipt of Goods, in solicitations and contracts when contract performance will be in the United Kingdom.</P>
                            <P>(h) Use the clause at 252.229-7008, Relief from Import Duty (United Kingdom), in solicitations issued and contracts awarded in the United Kingdom.</P>
                            <P>(i) Use the clause at 252.229-7009, Relief from Customs Duty and Value Added Tax on Fuel (Passenger Vehicles) (United Kingdom), in solicitations issued and contracts awarded in the United Kingdom for fuels (gasoline or diesel) and lubricants used in passenger vehicles (excluding taxis).</P>
                            <P>(j) Use the clause at 252.229-7010, Relief from Customs Duty on Fuel (United Kingdom), in solicitations issued and contracts awarded in the United Kingdom that require the use of fuels (gasoline or diesel) and lubricants in taxis or vehicles other than passenger vehicles.</P>
                            <P>(k) Use the clause at 252.229-7014, Full Exemption from Two-Percent Excise Tax on Certain Foreign Procurements, in contracts that include the clause at FAR 52.229-12, Tax on Certain Foreign Procurements, when the contractor has—</P>
                            <P>(1) Represented that it is a foreign person in response to the provision at FAR 52.229-11, Tax on Certain Foreign Procurements—Notice and Representation; and</P>
                            <P>
                                (2) Indicated that it is fully exempt from the tax for reasons cited on their 
                                <PRTPAGE P="311"/>
                                IRS Form W-14, Certificate of Foreign Contracting Party Receiving Federal Procurement Payments.
                            </P>
                            <CITA>[62 FR 34125, June 24, 1997, 77 FR 19130, Mar. 30, 2012; 78 FR 37989, June 25, 2013; 78 FR 40043, July 3, 2013; 79 FR 58700, Sept. 30, 2014; 80 FR 81469, Dec. 30, 2015; 85 FR 74612, Nov. 23, 2020; 87 FR 65517, Oct. 28, 2022]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 229.70—Special Procedures for Overseas Contracts</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>70 FR 6375, Feb. 7, 2005, unless otherwise noted.</P>
                        </SOURCE>
                        <NOTE>
                            <HD SOURCE="HED">Note:</HD>
                            <P>To obtain tax relief for overseas contracts, follow the procedures at PGI 229.70.</P>
                        </NOTE>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 230</EAR>
                    <HD SOURCE="HED">PART 230—COST ACCOUNTING STANDARDS ADMINISTRATION</HD>
                    <CONTENTS>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 230.2—CAS Program Requirements</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>230.201</SECTNO>
                            <SUBJECT>Contract requirements.</SUBJECT>
                            <SECTNO>230.201-5</SECTNO>
                            <SUBJECT>Waiver.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36406, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 230.2—CAS Program Requirements</HD>
                        <SECTION>
                            <SECTNO>230.201</SECTNO>
                            <SUBJECT>Contract requirements.</SUBJECT>
                        </SECTION>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>88 FR 73237, Oct. 25, 2023, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>230.201-5</SECTNO>
                            <SUBJECT>Waiver.</SUBJECT>
                            <P>(a)(1)(A) The military departments and the Principal Director, Defense Pricing, Contracting, and Acquisition Policy (DPCAP), Office of the Under Secretary of Defense (Acquisition and Sustainment)—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) May grant CAS waivers that meet the conditions in FAR 30.201-5(b)(1); and
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) May grant CAS waivers that meet the conditions in FAR 30.201-5(b)(2), provided the cognizant Federal agency official granting the waiver determines that—
                            </P>
                            <P>
                                (
                                <E T="03">i</E>
                                ) The property or services cannot reasonably be obtained under the contract, subcontract, or modification, as applicable, without granting the waiver;
                            </P>
                            <P>
                                (
                                <E T="03">ii</E>
                                ) The price can be determined to be fair and reasonable without the application of the Cost Accounting Standards; and
                            </P>
                            <P>
                                (
                                <E T="03">iii</E>
                                ) There are demonstrated benefits to granting the waiver.
                            </P>
                            <P>(B) Follow the procedures at PGI 230.201-5(a)(1) for submitting waiver requests to the Principal Director, DPCAP.</P>
                            <P>(2) The military departments shall not delegate CAS waiver authority below the individual responsible for issuing contracting policy for the department.</P>
                            <P>(e) By November 30th of each year, the military departments shall provide a report to the Office of the Principal Director, DPCAP (Contract Policy) of all waivers granted under FAR 30.201-5(a), during the previous fiscal year, for any contract, subcontract, or modification expected to have a value of $15 million or more. See PGI 230.201-5(e) for format and guidance for the report. The Principal Director, DPCAP, will submit a consolidated report to the CAS Board and the congressional defense committees.</P>
                            <CITA>[71 FR 69495, Dec. 1, 2006, as amended at 77 FR 52254, Aug. 29, 2012; 88 FR 73237, Oct. 25, 2023; 89 FR 60832, July 29, 2024]</CITA>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 231</EAR>
                    <HD SOURCE="HED">PART 231—CONTRACT COST PRINCIPLES AND PROCEDURES</HD>
                    <CONTENTS>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 231.1—Applicability</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>231.100</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>231.100-70</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 231.2—Contracts With Commercial Organizations</HD>
                            <SECTNO>231.205</SECTNO>
                            <SUBJECT>Selected costs.</SUBJECT>
                            <SECTNO>231.205-1</SECTNO>
                            <SUBJECT>Public relations and advertising costs.</SUBJECT>
                            <SECTNO>231.205-6</SECTNO>
                            <SUBJECT>Compensation for personal services.</SUBJECT>
                            <SECTNO>231.205-18</SECTNO>
                            <SUBJECT>Independent research and development and bid and proposal costs.</SUBJECT>
                            <SECTNO>231.205-19</SECTNO>
                            <SUBJECT>Insurance and indemnification.</SUBJECT>
                            <SECTNO>231.205-22</SECTNO>
                            <SUBJECT>Lobbying and political activity costs.</SUBJECT>
                            <SECTNO>231.205-70</SECTNO>
                            <SUBJECT>External restructuring costs.</SUBJECT>
                            <SECTNO>231.205-71</SECTNO>
                            <SUBJECT>Costs related to counterfeit electronic parts and suspect counterfeit electronic parts.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <PRTPAGE P="312"/>
                            <HD SOURCE="HED">Subpart 231.3—Contracts With Educational Institutions</HD>
                            <SECTNO>231.303</SECTNO>
                            <SUBJECT>Requirements.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 231.6—Contracts With State, Local, and Federally Recognized Indian Tribal Governments</HD>
                            <SECTNO>231.603</SECTNO>
                            <SUBJECT>Requirements.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 231.7—Contracts With Nonprofit Organizations</HD>
                            <SECTNO>231.703</SECTNO>
                            <SUBJECT>Requirements.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36408, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 231.1—Applicability</HD>
                        <SECTION>
                            <SECTNO>231.100</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>231.100-70</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at 252.231-7000, Supplemental Cost Principles, in all solicitations and contracts which are subject to the principles and procedures described in FAR subpart 31.1, 31.2, 31.6, or 31.7.</P>
                            <CITA>[59 FR 27672, May 27, 1994]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 231.2—Contracts With Commercial Organizations</HD>
                        <SECTION>
                            <SECTNO>231.205</SECTNO>
                            <SUBJECT>Selected costs.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>231.205-1</SECTNO>
                            <SUBJECT>Public relations and advertising costs.</SUBJECT>
                            <P>
                                (e) 
                                <E T="03">See</E>
                                 225.7303-2(e) for allowability provisions affecting foreign military sales contracts.
                            </P>
                            <P>(f) Unallowable public relations and advertising costs also include monies paid to the Government associated with the leasing of Government equipment, including lease payments and reimbursement for support services, except for foreign military sales contracts as provided for at 225.7303-2.</P>
                            <CITA>[74 FR 68382, Dec. 24, 2009]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>231.205-6</SECTNO>
                            <SUBJECT>Compensation for personal services.</SUBJECT>
                            <P>(f)(1) In accordance with Section 8122 of Pub. L. 104-61, and similar sections in subsequent Defense appropriations acts, costs for bonuses or other payments in excess of the normal salary paid by the contractor to an employee, that are part of restructuring costs associated with a business combination, are unallowable under DoD contracts funded by fiscal year 1996 or subsequent appropriations. This limitation does not apply to severance payments or early retirement incentive payments. (See 231.205-70(b) for the definitions of “business combination” and “restructuring costs.”)</P>
                            <P>(m)(1) Fringe benefit costs that are contrary to law, employer-employee agreement, or an established policy of the contractor are unallowable.</P>
                            <CITA>[57 FR 53600, Nov. 12, 1992, as amended at 58 FR 28469, May 13, 1993; 60 FR 2331, Jan. 9, 1995; 60 FR 61598, Nov. 30, 1995; 61 FR 7077, Feb. 26, 1996; 61 FR 36306, July 10, 1996; 61 FR 50454, Sept. 26, 1996; 61 FR 58490, Nov. 15, 1996; 61 FR 65479, Dec. 13, 1996; 62 FR 63036, Nov. 26, 1997; 63 FR 14641, Mar. 26, 1998; 78 FR 73453, Dec. 6, 2013]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>231.205-18</SECTNO>
                            <SUBJECT>Independent research and development and bid and proposal costs.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Definitions.</E>
                                 As used in this section—
                            </P>
                            <P>
                                <E T="03">Covered contract</E>
                                 means a DoD prime contract for an amount exceeding the simplified acquisition threshold, except for a fixed-price contract without cost incentives. The term also includes a subcontract for an amount exceeding the simplified acquisition threshold, except for a fixed-price subcontract without cost incentives under such a prime contract.
                            </P>
                            <P>
                                <E T="03">Covered segment</E>
                                 means a product division of the contractor that allocated more than $1,100,000 in independent research and development (IR&amp;D) costs and bid and proposal (B&amp;P) costs to covered contracts during the preceding fiscal year. In the case of a contractor that has no product divisions, the term means that contractor as a whole. A product division of the contractor that allocated less than $1,100,000 in IR&amp;D costs and B&amp;P costs to covered contracts during the preceding fiscal year is not subject to the limitations in paragraph (c) of this section.
                            </P>
                            <P>
                                <E T="03">Major contractor</E>
                                 means any contractor whose covered segments allocated a total of more than $11 million 
                                <PRTPAGE P="313"/>
                                in IR&amp;D costs and B&amp;P costs to covered contracts during the preceding fiscal year. For purposes of calculating the dollar threshold amounts to determine whether a contractor meets the definition of “major contractor,” do not include contractor segments allocating less than $1,100,000 of IR&amp;D and B&amp;P costs to covered contracts during the preceding fiscal year.
                            </P>
                            <P>
                                (c) 
                                <E T="03">Allowability.</E>
                                 (i) Departments/agencies shall not supplement this regulation in any way that limits IR&amp;D cost allowability and B&amp;P cost allowability.
                            </P>
                            <P>(ii) See 225.7303-2(c) for allowability provisions affecting foreign military sale contracts.</P>
                            <P>(iii)(A) For IR&amp;D costs major contractors incurred on covered contracts to be allowable—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) The contractor is required to report IR&amp;D projects generating the IR&amp;D costs to the Defense Technical Information Center (DTIC) using the DTIC's online input form and instructions at 
                                <E T="03">https://defenseinnovationmarketplace.dtic.mil/industry-portal/;</E>
                                 and
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) The contractor is required to update its DTIC inputs at least annually, no later than 3 months after the end of the contractor's fiscal year, and when the project is completed.
                            </P>
                            <P>(B) The amount of IR&amp;D costs allowable under DoD contracts shall not exceed the lesser of—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Such contracts' allocable share of total incurred IR&amp;D costs; or
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) The total amount of incurred IR&amp;D costs that the chief executive officer of the contractor has determined will advance the needs of DoD for future technology and advanced capability as DoD describes such needs in communications referenced at 242.771-3(c)(1)(i).
                            </P>
                            <P>
                                (C) Contractors that are not major contractors are encouraged to use the DTIC online input form and instructions at 
                                <E T="03">https://defenseinnovationmarketplace.dtic.mil/industry-portal/</E>
                                 to report IR&amp;D projects in order to provide DoD with visibility into the technical content of the contractors' IR&amp;D projects.
                            </P>
                            <P>(iv) Contractors are required to report incurred IR&amp;D costs separately from indirect costs.</P>
                            <P>(v) Contractors are required to report incurred B&amp;P costs separately from other indirect costs.</P>
                            <CITA>[88 FR 6599, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>231.205-19</SECTNO>
                            <SUBJECT>Insurance and indemnification.</SUBJECT>
                            <P>(e) In addition to the cost limitations in FAR 31.205-19(e), self-insurance and purchased insurance costs are subject to the requirements of the clauses at 252.217-7012, Liability and Insurance, and 252.228-7001, Ground and Flight Risk.</P>
                            <CITA>[75 FR 32645, June 8, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>231.205-22</SECTNO>
                            <SUBJECT>Lobbying and political activity costs.</SUBJECT>
                            <P>(a) Costs associated with preparing any material, report, list, or analysis on the actual or projected economic or employment impact in a particular State or congressional district of an acquisition program for which all research, development, testing, and evaluation has not been completed also are unallowable (10 U.S.C. 4652).</P>
                            <CITA>[69 FR 63332, Nov. 1, 2004, as amended at 86 FR 59870, Oct. 29, 2021; 87 FR 76995, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>231.205-70</SECTNO>
                            <SUBJECT>External restructuring costs.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Scope.</E>
                                 This subsection—
                            </P>
                            <P>(1) Prescribes policies and procedures for allowing contractor external restructuring costs when savings would result for DoD; and</P>
                            <P>(2) Implements 10 U.S.C. 3761.</P>
                            <P>
                                (b) 
                                <E T="03">Definitions.</E>
                                 As used in this section:
                            </P>
                            <P>
                                (1) 
                                <E T="03">Business combination</E>
                                 means a transaction whereby assets or operations of two or more companies not previously under common ownership or control are combined, whether by merger, acquisition, or sale/purchase of assets.
                            </P>
                            <P>
                                (2) 
                                <E T="03">External restructuring activities</E>
                                 means restructuring activities occurring after a business combination that affect the operations of companies not previously under common ownership or control. They do not include restructuring activities occurring after a business combination that affect the operations of only one of the companies not previously under common ownership or 
                                <PRTPAGE P="314"/>
                                control, or, when there has been no business combination, restructuring activities undertaken within one company. External restructuring activities are a direct outgrowth of a business combination. They normally will be initiated within 3 years of the business combination.
                            </P>
                            <P>
                                (3) 
                                <E T="03">Restructuring activities</E>
                                 means nonroutine, nonrecurring, or extraordinary activities to combine facilities, operations, or workforce, in order to eliminate redundant capabilities, improve future operations, and reduce overall costs. Restructuring activities do not include routine or ongoing repositionings and redeployments of a contractor's productive facilities or workforce (e.g., normal plant rearrangement or employee relocation), nor do they include other routine or ordinary activities charged as indirect costs that would otherwise have been incurred (e.g., planning and analysis, contract administration and oversight, or recurring financial and administrative support).
                            </P>
                            <P>
                                (4) 
                                <E T="03">Restructuring costs</E>
                                 means the costs, including both direct and indirect, of restructuring activities. Restructuring costs that may be allowed include, but are not limited to, severance pay for employees, early retirement incentive payments for employees, employee retraining costs, relocation expense for retained employees, and relocation and rearrangement of plant and equipment. For purposes of this definition, if restructuring costs associated with external restructuring activities allocated to DoD contracts are less than $2.5 million, the costs shall not be subject to the audit, review, and determination requirements of paragraph (c)(4) of this subsection; instead, the normal rules for determining cost allowability in accordance with FAR part 31 shall apply.
                            </P>
                            <P>
                                (5) 
                                <E T="03">Restructuring savings</E>
                                 means cost reductions, including both direct and indirect cost reductions, that result from restructuring activities. Reassignments of cost to future periods are not restructuring savings.
                            </P>
                            <P>
                                (c) 
                                <E T="03">Limitations on cost allowability.</E>
                                 Restructuring costs associated with external restructuring activities shall not be allowed unless—
                            </P>
                            <P>(1) Such costs are allowable in accordance with FAR part 31 and DFARS part 231;</P>
                            <P>(2) An audit of projected restructuring costs and restructuring savings is performed;</P>
                            <P>(3) The cognizant administrative contracting officer (ACO) reviews the audit report and the projected costs and projected savings, and negotiates an advance agreement in accordance with paragraph (d) of this subsection; and</P>
                            <P>(4)(i) The official designated in paragraph (c)(4)(ii) of this subsection determines in writing that the audited projected savings, on a present value basis, for DoD resulting from the restructuring will exceed either—</P>
                            <P>(A) The costs allowed by a factor of at least two to one; or</P>
                            <P>(B) The costs allowed, and the business combination will result in the preservation of a critical capability that might otherwise be lost to DoD.</P>
                            <P>(ii)(A) If the amount of restructuring costs is expected to exceed $25 million over a 5-year period, the designated official is the Under Secretary of Defense (Acquisition and Sustainment) or the Principal Deputy. This authority may not be delegated below the level of an Assistant Secretary of Defense.</P>
                            <P>(B) For all other cases, the designated official is the Director of the Defense Contract Management Agency. The Director may not delegate this authority.</P>
                            <P>
                                (d) 
                                <E T="03">Procedures and ACO responsibilities.</E>
                                 As soon as it is known that the contractor will incur restructuring costs for external restructuring activities, the cognizant ACO shall follow the procedures at PGI 231.205-70(d).
                            </P>
                            <P>
                                (e) 
                                <E T="03">Information needed to obtain a determination.</E>
                                 (1) The novation agreement (if one is required).
                            </P>
                            <P>(2) The contractor's restructuring proposal.</P>
                            <P>(3) The proposed advance agreement.</P>
                            <P>(4) The audit report.</P>
                            <P>(5) Any other pertinent information.</P>
                            <P>(6) The cognizant ACO's recommendation for a determination. This recommendation must clearly indicate one of the following, consistent with paragraph (c)(4)(i) of this subsection:</P>
                            <P>
                                (i) The audited projected savings for DoD will exceed the costs allowed by a 
                                <PRTPAGE P="315"/>
                                factor of at least two to one on a present value basis.
                            </P>
                            <P>(ii) The business combination will result in the preservation of a critical capability that might otherwise be lost to DoD, and the audited projected savings for DoD will exceed the costs allowed on a present value basis.</P>
                            <P>
                                (f) 
                                <E T="03">Contracting officer responsibilities.</E>
                                 (1) The contracting officer, in consultation with the cognizant ACO, should consider including a repricing clause in noncompetitive fixed-price contracts that are negotiated during the period between—
                            </P>
                            <P>(i) The time a business combination is announced; and</P>
                            <P>(ii) The time the contractor's forward pricing rates are adjusted to reflect the impact of restructuring.</P>
                            <P>(2) The decision to use a repricing clause will depend upon the particular circumstances involved, including—</P>
                            <P>(i) When the restructuring will take place;</P>
                            <P>(ii) When restructuring savings will begin to be realized;</P>
                            <P>(iii) The contract performance period;</P>
                            <P>(iv) Whether the contracting parties are able to make a reasonable estimate of the impact of restructuring on the contract; and</P>
                            <P>(v) The size of the potential dollar impact of restructuring on the contract.</P>
                            <P>(3) If the contracting officer decides to use a repricing clause, the clause must provide for a downward-only price adjustment to ensure that DoD receives its appropriate share of restructuring net savings.</P>
                            <CITA>[63 FR 7309, Feb. 13, 1998; 63 FR 12862, Mar. 16, 1998, as amended at 64 FR 18828, Apr. 16, 1999; 65 FR 39705, June 27, 2000; 68 FR 7440, Feb. 14, 2003; 69 FR 63332, Nov. 1, 2004; 70 FR 43075, July 26, 2005; 87 FR 76995, Dec. 16, 2022; 88 FR 73237, Oct. 25, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>231.205-71</SECTNO>
                            <SUBJECT>Costs related to counterfeit electronic parts and suspect counterfeit electronic parts.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Scope.</E>
                                 This section implements the requirements of section 818(c)(2), National Defense Authorization Act for Fiscal Year 2012 (Pub. L. 112-81), as modified by section 833, National Defense Authorization Act for Fiscal Year 2013 (Pub. L. 112-239), and section 885 of the National Defense Authorization Act for Fiscal Year 2016 (Pub. L. 114-92).
                            </P>
                            <P>(b) The costs of counterfeit electronic parts and suspect counterfeit electronic parts and the costs of rework or corrective action that may be required to remedy the use or inclusion of such parts are unallowable, unless—</P>
                            <P>(1) The contractor has an operational system to detect and avoid counterfeit electronic parts and suspect counterfeit electronic parts that has been reviewed and approved by DoD pursuant to 244.303(b);</P>
                            <P>(2) The counterfeit electronic parts or suspect counterfeit electronic parts are Government-furnished property as defined in FAR 45.101 or were obtained by the contractor in accordance with the clause at 252.246-7008, Sources of Electronic Parts; and</P>
                            <P>(3) The contractor—</P>
                            <P>(i) Becomes aware of the counterfeit electronic parts or suspect counterfeit electronic parts through inspection, testing, and authentication efforts of the contractor or its subcontractors; through a Government Industry Data Exchange Program (GIDEP) alert; or by other means; and</P>
                            <P>
                                (ii) Provides timely (
                                <E T="03">i.e.,</E>
                                 within 60 days after the contractor becomes aware) written notice to—
                            </P>
                            <P>(A) The cognizant contracting officer(s); and</P>
                            <P>(B) GIDEP (unless the contractor is a foreign corporation or partnership that does not have an office, place of business, or fiscal paying agent in the United States; or the counterfeit electronic part or suspect counterfeit electronic part is the subject of an on-going criminal investigation).</P>
                            <CITA>[81 FR 59515, Aug. 30, 2016]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 231.3—Contracts With Educational Institutions</HD>
                        <SECTION>
                            <SECTNO>231.303</SECTNO>
                            <SUBJECT>Requirements.</SUBJECT>
                            <P>
                                (1) Pursuant to section 841 of the National Defense Authorization Act for Fiscal Year 1994 (Pub. L. 103-160), no limitation may be placed on the reimbursement of otherwise allowable indirect costs incurred by an institution of higher education under a DoD contract awarded on or after November 30, 1993, unless that same limitation is applied 
                                <PRTPAGE P="316"/>
                                uniformly to all other organizations performing similar work under DoD contracts. The 26 percent limitation imposed on administrative indirect costs by OMB Circular No. A-21 shall not be applied to DoD contracts awarded on or after November 30, 1993, to institutions of higher education because the same limitation is not applied to other organizations performing similar work.
                            </P>
                            <P>(2) The cognizant administrative contracting officer may waive the prohibition in 231.303(1) if the governing body of the institution of higher education requests the waiver to simplify the institution's overall management of DoD cost reimbursements under DoD contracts.</P>
                            <P>(3) Under 10 U.S.C. 4652, the costs cited in 231.205-22(a) are unallowable.</P>
                            <CITA>[59 FR 26144, May 19, 1994, as amended at 60 FR 2331, Jan. 9, 1995; 61 FR 36306, July 10, 1996; 62 FR 47155, Sept. 8, 1997; 63 FR 14641, Mar. 26, 1998; 87 FR 76995, Dec. 16, 2022]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 231.6—Contracts With State, Local, and Federally Recognized Indian Tribal Governments</HD>
                        <SECTION>
                            <SECTNO>231.603</SECTNO>
                            <SUBJECT>Requirements.</SUBJECT>
                            <P>Under 10 U.S.C. 4652, the costs cited in 231.205-22(a) are unallowable.</P>
                            <CITA>[61 FR 36306, July 10, 1996, as amended at 62 FR 47155, Sept. 8, 1997; 63 FR 14641, Mar. 26, 1998; 87 FR 76995, Dec. 16, 2022]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 231.7—Contracts With Nonprofit Organizations</HD>
                        <SECTION>
                            <SECTNO>231.703</SECTNO>
                            <SUBJECT>Requirements.</SUBJECT>
                            <P>Under 10 U.S.C. 4652, the costs cited in 231.205-22(a) are unallowable.</P>
                            <CITA>[61 FR 36306, July 10, 1996, as amended at 62 FR 47155, Sept. 8, 1997; 63 FR 14641, Mar. 26, 1998; 87 FR 76995, Dec. 16, 2022]</CITA>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 232</EAR>
                    <HD SOURCE="HED">PART 232—CONTRACT FINANCING</HD>
                    <CONTENTS>
                        <SECHD>Sec.</SECHD>
                        <SECTNO>232.001</SECTNO>
                        <SUBJECT>Definitions.</SUBJECT>
                        <SECTNO>232.006</SECTNO>
                        <SUBJECT>Reduction or suspension of contract payments upon finding of fraud.</SUBJECT>
                        <SECTNO>232.006-5</SECTNO>
                        <SUBJECT>Reporting.</SUBJECT>
                        <SECTNO>232.007</SECTNO>
                        <SUBJECT>Contract financing payments.</SUBJECT>
                        <SECTNO>232.009</SECTNO>
                        <SUBJECT>Providing accelerated payments to small business contractors and to prime contractors that subcontract with a small business concern.</SUBJECT>
                        <SECTNO>232.009-1</SECTNO>
                        <SUBJECT>General.</SUBJECT>
                        <SECTNO>232.070</SECTNO>
                        <SUBJECT>Responsibilities.</SUBJECT>
                        <SECTNO>232.071</SECTNO>
                        <SUBJECT>[Reserved]</SUBJECT>
                        <SECTNO>232.072</SECTNO>
                        <SUBJECT>Financial responsibility of contractors.</SUBJECT>
                        <SECTNO>232.072-1</SECTNO>
                        <SUBJECT>Required financial reviews.</SUBJECT>
                        <SECTNO>232.072-2</SECTNO>
                        <SUBJECT>Appropriate information.</SUBJECT>
                        <SECTNO>232.072-3</SECTNO>
                        <SUBJECT>Cash flow forecasts.</SUBJECT>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 232.1—Financing for Other Than a Commercial Purchase</HD>
                            <SECTNO>232.102</SECTNO>
                            <SUBJECT>Description of contract financing methods.</SUBJECT>
                            <SECTNO>232.102-70</SECTNO>
                            <SUBJECT>Provisional delivery payments.</SUBJECT>
                            <SECTNO>232.104</SECTNO>
                            <SUBJECT>Providing contract financing.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 232.2—Commercial Product and Commercial Service Purchase Financing</HD>
                            <SECTNO>232.202-4</SECTNO>
                            <SUBJECT>Security for Government financing.</SUBJECT>
                            <SECTNO>232.206</SECTNO>
                            <SUBJECT>Solicitation provisions and contract clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 232.3—Loan Guarantees for Defense Production</HD>
                            <SECTNO>232.302</SECTNO>
                            <SUBJECT>Authority.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 232.4—Advance Payments for Other Than Commercial Acquisitions</HD>
                            <SECTNO>232.404</SECTNO>
                            <SUBJECT>Exclusions.</SUBJECT>
                            <SECTNO>232.409</SECTNO>
                            <SUBJECT>Contracting officer action.</SUBJECT>
                            <SECTNO>232.409-1</SECTNO>
                            <SUBJECT>Recommendation for approval.</SUBJECT>
                            <SECTNO>232.410</SECTNO>
                            <SUBJECT>Findings, determination, and authorization.</SUBJECT>
                            <SECTNO>232.412</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <SECTNO>232.412-70</SECTNO>
                            <SUBJECT>Additional clauses.</SUBJECT>
                            <SECTNO>232.470</SECTNO>
                            <SUBJECT>Advance payment pool.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 232.5—Progress Payments Based on Costs</HD>
                            <SECTNO>232.501</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>232.501-1</SECTNO>
                            <SUBJECT>Customary progress payment rates.</SUBJECT>
                            <SECTNO>232.501-2</SECTNO>
                            <SUBJECT>Unusual progress payments.</SUBJECT>
                            <SECTNO>232.501-3</SECTNO>
                            <SUBJECT>Contract price.</SUBJECT>
                            <SECTNO>232.502</SECTNO>
                            <SUBJECT>Preaward matters.</SUBJECT>
                            <SECTNO>232.502-4</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <SECTNO>232.502-4-70</SECTNO>
                            <SUBJECT>Additional clauses.</SUBJECT>
                            <SECTNO>232.503</SECTNO>
                            <SUBJECT>Postaward matters.</SUBJECT>
                            <SECTNO>232.503-6</SECTNO>
                            <SUBJECT>Suspension or reduction of payments.</SUBJECT>
                            <SECTNO>232.503-15</SECTNO>
                            <SUBJECT>Application of Government title terms.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 232.6—Contract Debts</HD>
                            <SECTNO>232.602</SECTNO>
                            <SUBJECT>Responsibilities.</SUBJECT>
                            <SECTNO>232.603</SECTNO>
                            <SUBJECT>Debt determination.</SUBJECT>
                            <SECTNO>232.604</SECTNO>
                            <SUBJECT>Demand for payment.</SUBJECT>
                            <SECTNO>232.610</SECTNO>
                            <SUBJECT>Compromising debts.</SUBJECT>
                            <SECTNO>232.611</SECTNO>
                            <SUBJECT>
                                Contract clause.
                                <PRTPAGE P="317"/>
                            </SUBJECT>
                            <SECTNO>232.670</SECTNO>
                            <SUBJECT>Transfer of responsibility for debt collection.</SUBJECT>
                            <SECTNO>232.671</SECTNO>
                            <SUBJECT>Bankruptcy reporting.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 232.7—Contract Funding</HD>
                            <SECTNO>232.702</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>232.703</SECTNO>
                            <SUBJECT>Contract funding requirements.</SUBJECT>
                            <SECTNO>232.703-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>232.703-3</SECTNO>
                            <SUBJECT>Contracts crossing fiscal years.</SUBJECT>
                            <SECTNO>232.703-70</SECTNO>
                            <SUBJECT>Military construction appropriations act restriction.</SUBJECT>
                            <SECTNO>232.704</SECTNO>
                            <SUBJECT>Limitation of cost or funds.</SUBJECT>
                            <SECTNO>232.704-70</SECTNO>
                            <SUBJECT>Incrementally funded fixed-price contracts.</SUBJECT>
                            <SECTNO>232.706</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <SECTNO>232.706-70</SECTNO>
                            <SUBJECT>Clause for limitation of Government's obligation.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 232.8—Assignment of Claims</HD>
                            <SECTNO>232.803</SECTNO>
                            <SUBJECT>Policies.</SUBJECT>
                            <SECTNO>232.805</SECTNO>
                            <SUBJECT>Procedure.</SUBJECT>
                            <SECTNO>232.806</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 232.9—Prompt Payment</HD>
                            <SECTNO>232.901</SECTNO>
                            <SUBJECT>Applicability.</SUBJECT>
                            <SECTNO>232.903</SECTNO>
                            <SUBJECT>Responsibilities.</SUBJECT>
                            <SECTNO>232.904</SECTNO>
                            <SUBJECT>Determining payment due dates.</SUBJECT>
                            <SECTNO>232.905</SECTNO>
                            <SUBJECT>Payment documentation and process.</SUBJECT>
                            <SECTNO>232.906</SECTNO>
                            <SUBJECT>Making payments.</SUBJECT>
                            <SECTNO>232.908</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 232.10—Performance-Based Payments</HD>
                            <SECTNO>232.1001</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>232.1003-70</SECTNO>
                            <SUBJECT>Criteria for use.</SUBJECT>
                            <SECTNO>232.1004</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>232.1005-70</SECTNO>
                            <SUBJECT>Solicitation provisions and contract clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 232.11—Electronic Funds Transfer</HD>
                            <SECTNO>232.1108</SECTNO>
                            <SUBJECT>Payment by Governmentwide commercial purchase card.</SUBJECT>
                            <SECTNO>232.1108-70</SECTNO>
                            <SUBJECT>Prohibition of Governmentwide commercial purchase card as a method of payment when the tax on certain foreign procurements applies.</SUBJECT>
                            <SECTNO>232.1110</SECTNO>
                            <SUBJECT>Solicitation provision and contract clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 232.70—Electronic Submission and Processing of Payment Requests and Receiving Reports</HD>
                            <SECTNO>232.7000</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>232.7001</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>232.7002</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>232.7003</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>232.7004</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 232.71—Levies on Contract Payments</HD>
                            <SECTNO>232.7100</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>232.7101</SECTNO>
                            <SUBJECT>Policy and procedures.</SUBJECT>
                            <SECTNO>232.7102</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <RESERVED>Subpart 232.72 [Reserved]</RESERVED>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36409, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SECTION>
                        <SECTNO>232.001</SECTNO>
                        <SUBJECT>Definitions.</SUBJECT>
                        <P>
                            <E T="03">Incremental funding</E>
                             means the partial funding of a contract or an exercised option, with additional funds anticipated to be provided at a later time.
                        </P>
                        <CITA>[71 FR 18673, Apr. 12, 2006]</CITA>
                    </SECTION>
                    <SECTION>
                        <SECTNO>232.006</SECTNO>
                        <SUBJECT>Reduction or suspension of contract payments upon finding of fraud.</SUBJECT>
                    </SECTION>
                    <SECTION>
                        <SECTNO>232.006-5</SECTNO>
                        <SUBJECT>Reporting.</SUBJECT>
                        <P>Departments and agencies, in accordance with department/agency procedures, shall prepare and submit to the Under Secretary of Defense (Acquisition and Sustainment) through the Principal Director, Defense Pricing, Contracting, and Acquisition Policy, annual reports (Report Control Symbol DD-AT&amp;L(A) 1891) containing the information required by FAR 32.006-5.</P>
                        <CITA>[63 FR 11535, Mar. 9, 1998, as amended at 65 FR 39705, June 27, 2000; 68 FR 7440, Feb. 14, 2003; 88 FR 73237, Oct. 25, 2023; 89 FR 60832, July 29, 2024]</CITA>
                    </SECTION>
                    <SECTION>
                        <SECTNO>232.007</SECTNO>
                        <SUBJECT>Contract financing payments.</SUBJECT>
                        <P>(a) DoD policy is to make contract financing payments as quickly as possible. Generally, the contracting officer shall insert the standard due dates of 7 days for progress payments, and 14 days for performance-based payments and interim payments on cost-type contracts, in the appropriate paragraphs of the respective payment clauses. For interim payments on cost-reimbursement contracts for services, see 232.906(a)(i).</P>
                        <P>
                            (b) The contracting officer should coordinate contract financing payment terms with offices that will be involved in the payment process to ensure that 
                            <PRTPAGE P="318"/>
                            specified terms can be met. Where justified, the contracting officer may insert a due date greater than, but not less than, the standard. In determining payment terms, consider—
                        </P>
                        <P>(i) Geographical separation;</P>
                        <P>(ii) Workload;</P>
                        <P>(iii) Contractor ability to submit a proper request; and</P>
                        <P>(iv) Other factors that could affect timing of payment.</P>
                        <CITA>[70 FR 75412, Dec. 20, 2005]</CITA>
                    </SECTION>
                    <SECTION>
                        <SECTNO>232.009</SECTNO>
                        <SUBJECT>Providing accelerated payments to small business contractors and to prime contractors that subcontract with a small business concern.</SUBJECT>
                        <CITA>[88 FR 12863, Mar. 1, 2023]</CITA>
                    </SECTION>
                    <SECTION>
                        <SECTNO>232.009-1</SECTNO>
                        <SUBJECT>General.</SUBJECT>
                        <P>10 U.S.C. 3801(b) requires DoD to provide accelerated payments to small business contractors and subcontractors, to the fullest extent permitted by law, with a goal of 15 days.</P>
                        <CITA>[88 FR 12863, Mar. 1, 2023]</CITA>
                    </SECTION>
                    <SECTION>
                        <SECTNO>232.070</SECTNO>
                        <SUBJECT>Responsibilities.</SUBJECT>
                        <P>(a) The Principal Director, Defense Pricing, Contracting, and Acquisition Policy (DPCAP), Office of the Under Secretary of Defense (Acquisition and Sustainment) (OUSD(A&amp;S)DPCAP) is responsible for ensuring uniform administration of DoD contract financing, including DoD contract financing policies and important related procedures. Agency discretion under FAR part 32 is at the DoD level and is not delegated to the departments and agencies. Proposals by the departments and agencies, to exercise agency discretion, shall be submitted to OUSD(A&amp;S)DPCAP.</P>
                        <P>(b) Departments and agencies are responsible for their day-to-day contract financing operations. Refer specific cases involving financing policy or important procedural issues to OUSD(A&amp;S)DPCAP for consideration through the department/agency Contract Finance Committee members (also see subpart 201.4 for deviation request and approval procedures).</P>
                        <P>(c) See PGI 232.070(c) for information on department/agency contract financing offices.</P>
                        <CITA>[63 FR 11535, Mar. 9, 1998, as amended at 65 FR 39705, June 27, 2000; 68 FR 7440, Feb. 14, 2003; 70 FR 75412, Dec. 20, 2005; 72 FR 20765, Apr. 26, 2007; 88 FR 73237, Oct. 25, 2023; 89 FR 60832, July 29, 2024]</CITA>
                    </SECTION>
                    <SECTION>
                        <SECTNO>232.071</SECTNO>
                        <RESERVED>[Reserved]</RESERVED>
                    </SECTION>
                    <SECTION>
                        <SECTNO>232.072</SECTNO>
                        <SUBJECT>Financial responsibility of contractors.</SUBJECT>
                        <P>Use the policies and procedures in this section in determining the financial capability of current or prospective contractors.</P>
                        <CITA>[63 FR 11535, Mar. 9, 1998]</CITA>
                    </SECTION>
                    <SECTION>
                        <SECTNO>232.072-1</SECTNO>
                        <SUBJECT>Required financial reviews.</SUBJECT>
                        <P>The contracting officer shall perform a financial review when the contracting officer does not otherwise have sufficient information to make a positive determination of financial responsibility. In addition, the contracting officer shall consider performing a financial review—</P>
                        <P>(a) Prior to award of a contract, when—</P>
                        <P>(1) The contractor is on a list requiring preaward clearance or other special clearance before award;</P>
                        <P>(2) The contractor is listed on the Consolidated List of Contractors Indebted to the Government (Hold-Up List), or is otherwise known to be indebted to the Government;</P>
                        <P>(3) The contractor may receive Government assets such as contract financing payments or Government property;</P>
                        <P>(4) The contractor is experiencing performance difficulties on other work; or</P>
                        <P>(5) The contractor is a new company or a new supplier of the item.</P>
                        <P>(b) At periodic intervals after award of a contract, when—</P>
                        <P>(1) Any of the conditions in paragraphs (a)(2) through (a)(5) of this subsection are applicable; or</P>
                        <P>(2) There is any other reason to question the contractor's ability to finance performance and completion of the contract.</P>
                        <CITA>[63 FR 11535, Mar. 9, 1998]</CITA>
                    </SECTION>
                    <SECTION>
                        <PRTPAGE P="319"/>
                        <SECTNO>232.072-2</SECTNO>
                        <SUBJECT>Appropriate information.</SUBJECT>
                        <P>(a) The contracting officer shall obtain the type and depth of financial and other information that is required to establish a contractor's financial capability or disclose a contractor's financial condition. While the contracting officer should not request information that is not necessary for protection for the Government's interests, the contracting officer must insist upon obtaining the information that is necessary. The unwillingness or inability of a contractor to present reasonably requested information in a timely manner, especially information that a prudent business person would be expected to have and to use in the professional management of a business, may be a material fact in the determination of the contractor's responsibility and prospects for contract completion.</P>
                        <P>(b) The contracting officer shall obtain the following information to the extent required to protect the Government's interest. In addition, if the contracting officer concludes that information not listed in paragraphs (b)(1) through (b)(10) of this subsection is required to comply with 232.072-1, that information should be requested. The information must be for the person(s) who are legally liable for contract performance. If the contractor is not a corporation, the contracting officer shall obtain the required information for each individual/joint venturer/partner:</P>
                        <P>(1) Balance sheet and income statement—</P>
                        <P>(i) For the current fiscal year (interim);</P>
                        <P>(ii) For the most recent fiscal year and, preferably, for the 2 preceding fiscal years. These should be certified by an independent public accountant or by an appropriate officer of the firm; and</P>
                        <P>(iii) Forecasted for each fiscal year for the remainder of the period of contract performance.</P>
                        <P>(2) Summary history of the contractor and its principal managers, disclosing any previous insolvencies—corporate or personal, and describing its products or services.</P>
                        <P>(3) Statement of all affiliations disclosing—</P>
                        <P>(i) Material financial interests of the contractor;</P>
                        <P>(ii) Material financial interests in the contractor;</P>
                        <P>(iii) Material affiliations of owners, officers, directors, major stockholders; and</P>
                        <P>(iv) The major stockholders if the contractor is not a widely-traded, publicly-held corporation.</P>
                        <P>(4) Statement of all forms of compensation to each officer, manager, partner, joint venturer, or proprietor, as appropriate—</P>
                        <P>(i) Planned for the current year;</P>
                        <P>(ii) Paid during the past 2 years; and</P>
                        <P>(iii) Deferred to future periods.</P>
                        <P>(5) Business base and forecast that—</P>
                        <P>(i) Shows, by significant markets, existing contracts and outstanding offers, including those under negotiation; and</P>
                        <P>(ii) Is reconcilable to indirect cost rate projections.</P>
                        <P>(6) Cash forecast for the duration of the contract (see 232.072-3).</P>
                        <P>(7) Financing arrangement information that discloses—</P>
                        <P>(i) Availability of cash to finance contract performance;</P>
                        <P>(ii) Contractor's exposure to financial crisis from creditor's demands;</P>
                        <P>(iii) Degree to which credit security provisions could conflict with Government title terms under contract financing;</P>
                        <P>(iv) Clearly stated confirmations of credit with no unacceptable qualifications;</P>
                        <P>(v) Unambiguous written agreement by a creditor if credit arrangements include deferred trade payments or creditor subordinations/repayment suspensions.</P>
                        <P>(8) Statement of all state, local, and Federal tax accounts, including special mandatory contributions, e.g., environmental superfund.</P>
                        <P>(9) Description and explanation of the financial effect of issues such as—</P>
                        <P>(i) Leases, deferred purchase arrangements, or patent or royalty arrangements;</P>
                        <P>(ii) Insurance, when relevant to the contract;</P>
                        <P>(iii) Contemplated capital expenditures, changes in equity, or contractor debt load;</P>
                        <P>
                            (iv) Pending claims either by or against the contractor;
                            <PRTPAGE P="320"/>
                        </P>
                        <P>(v) Contingent liabilities such as guarantees, litigation, environmental, or product liabilities;</P>
                        <P>(vi) Validity of accounts receivable and actual value of inventory, as assets; and</P>
                        <P>(vii) Status and aging of accounts payable.</P>
                        <P>(10) Significant ratios such as—</P>
                        <P>(i) Inventory to annual sales;</P>
                        <P>(ii) Inventory to current assets;</P>
                        <P>(iii) Liquid assets to current assets;</P>
                        <P>(iv) Liquid assets to current liabilities;</P>
                        <P>(v) Current assets to current liabilities; and</P>
                        <P>(vi) Net worth to net debt.</P>
                        <CITA>[63 FR 11535, Mar. 9, 1998]</CITA>
                    </SECTION>
                    <SECTION>
                        <SECTNO>232.072-3</SECTNO>
                        <SUBJECT>Cash flow forecasts.</SUBJECT>
                        <P>(a) A contractor must be able to sustain a sufficient cash flow to perform the contract. When there is doubt regarding the sufficiency of a contractor's cash flow, the contracting officer should require the contractor to submit a cash flow forecast covering the duration of the contract.</P>
                        <P>(b) A contractor's inability of refusal to prepare and provide cash flow forecasts or to reconcile actual cash flow with previous forecasts is a strong indicator of serious managerial deficiencies or potential contract cost or performance problems.</P>
                        <P>(c) Single or one-time cash flow forecasts are of limited forecasting power. As such, they should be limited to preaward survey situations. Reliability of cash flow forecasts can be established only by comparing a series of previous actual cash flows with the corresponding forecasts and examining the causes of any differences.</P>
                        <P>(d) Cash flow forecasts must—</P>
                        <P>(1) Show the origin and use of all material amounts of cash within the entire business unit responsible for contract performance, period by period, for the length of the contract (or until the risk of a cash crisis ends); and</P>
                        <P>(2) Provide an audit trail to the data and assumptions used to prepare it.</P>
                        <P>(e) Cash flow forecasts can be no more reliable than the assumptions on which they are based. Most important of these assumptions are—</P>
                        <P>(1) Estimated amounts and timing of purchases and payments for materials, parts, components, subassemblies, and services;</P>
                        <P>(2) Estimated amounts and timing of payments of purchase or production of capital assets, test facilities, and tooling;</P>
                        <P>(3) Amounts and timing of fixed cash charges such as debt installments, interest, rentals, taxes, and indirect costs;</P>
                        <P>(4) Estimated amounts and timing of payments for projected labor, both direct and indirect;</P>
                        <P>(5) Reasonableness of projected manufacturing and production schedules;</P>
                        <P>(6) Estimated amounts and timing of billings to customers (including progress payments), and customer payments;</P>
                        <P>(7) Estimated amounts and timing of cash receipts from lenders or other credit sources, and liquidation of loans; and</P>
                        <P>(8) Estimated amount and timing of cash receipt from other sources.</P>
                        <P>(f) The contracting officer should review the assumptions underlying the cash flow forecasts. In determining whether the assumptions are reasonable and realistic, the contracting officer should consult with—</P>
                        <P>(1) The contractor;</P>
                        <P>(2) Government personnel in the areas of finance, engineering, production, cost, and price analysis; or</P>
                        <P>(3) Prospective supply, subcontract, and loan or credit sources.</P>
                        <CITA>[63 FR 11536, Mar. 9, 1998]</CITA>
                    </SECTION>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 232.1—Financing for Other Than a Commercial Purchase</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>63 FR 11536, Mar. 9, 1998, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>232.102</SECTNO>
                            <SUBJECT>Description of contract financing methods.</SUBJECT>
                            <P>
                                (e)(2) Progress payments based on percentage or stage of completion are authorized only for contracts for construction (as defined in FAR 36.102), shipbuilding, and ship conversion, alteration, or repair. However, percentage or state of completion methods of measuring contractor performance may be used for performance-based 
                                <PRTPAGE P="321"/>
                                payments in accordance with FAR Subpart 32.10.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.102-70</SECTNO>
                            <SUBJECT>Provisional delivery payments.</SUBJECT>
                            <P>(a) The contracting officer may establish provisional delivery payments to pay contractors for the costs of supplies and services delivered to and accepted by the Government under the following contract actions if undefinitized:</P>
                            <P>(1) Letter contracts contemplating a fixed-price contract.</P>
                            <P>(2) Orders under basic ordering agreements.</P>
                            <P>(3) Spares provisioning documents annexed to contracts.</P>
                            <P>(4) Unpriced equitable adjustments on fixed-price contracts.</P>
                            <P>(5) Orders under indefinite-delivery contracts.</P>
                            <P>(b) Provisional delivery payments shall be—</P>
                            <P>(1) Used sparingly;</P>
                            <P>(2) Priced conservatively; and</P>
                            <P>(3) Reduced by liquidating previous progress payments in accordance with the Progress Payments clause.</P>
                            <P>(c) Provisional delivery payments shall not—</P>
                            <P>(1) Include profit;</P>
                            <P>(2) Exceed funds obligated for the undefinitized contract action; or</P>
                            <P>(3) Influence the definitized contract price.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.104</SECTNO>
                            <SUBJECT>Providing contract financing.</SUBJECT>
                            <P>For fixed-price contracts with a period of performance in excess of a year that meet the dollar thresholds established in FAR 32.104(d), and for solicitations expected to result in such contracts, in lieu of the requirement at FAR 32.104(d)(1)(ii) for the contractor to demonstrate actual financial need or the unavailability of private financing, DoD has determined that—</P>
                            <P>(1) The use of customary contract financing (see FAR 32.113), other than loan guarantees and advance payments, is in DoD's best interest; and</P>
                            <P>(2) Further justification of its use in individual acquisitions is unnecessary.</P>
                            <CITA>[81 FR 93842, Dec. 22, 2016]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 232.2—Commercial Product and Commercial Service Purchase Financing</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>63 FR 11537, Mar. 9, 1998, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>232.202-4</SECTNO>
                            <SUBJECT>Security for Government financing.</SUBJECT>
                            <P>(a)(2) When determining whether an offeror's financial condition is adequate security, see 232.072-2 and 232.072-3 for guidance. It should be noted that an offeror's financial condition may be sufficient to make the contractor responsible for award purposes, but may not be adequate security for commercial contract financing.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.206</SECTNO>
                            <SUBJECT>Solicitation provisions and contract clauses.</SUBJECT>
                            <P>
                                (f) 
                                <E T="03">Prompt payment for commercial purchase payments.</E>
                                 The contracting officer shall incorporate the following standard prompt payment terms for commercial product and commercial service contract financing:
                            </P>
                            <P>
                                (i) 
                                <E T="03">Commercial advance payments:</E>
                                 The contractor entitlement date specified in the contract, or 30 days after receipt by the designated billing office of a proper request for payment, whichever is later.
                            </P>
                            <P>
                                (ii) 
                                <E T="03">Commercial interim payments:</E>
                                 The contractor entitlement date specified in the contract, or 14 days after receipt by the designated billing office of a proper request for payment, whichever is later. The prompt payment standards for commercial delivery payments shall be the same as specified in FAR Subpart 32.9 for invoice payments for the item delivered.
                            </P>
                            <P>
                                (g) 
                                <E T="03">Installment payment financing for commercial products and commercial services.</E>
                                 Installment payment financing shall not be used for DoD contracts, unless market research has established that this form of contract financing is both appropriate and customary in the commercial marketplace. When installment payment financing is used, the contracting officer shall use the ceiling percentage of contract price that is 
                                <PRTPAGE P="322"/>
                                customary in the particular marketplace (not to exceed the maximum rate established in FAR 52.232-30).
                            </P>
                            <CITA>[63 FR 11537, Mar. 9, 1998, as amended at 70 FR 75413, Dec. 20, 2005; 87 FR 6587, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 232.3—Loan Guarantees for Defense Production</HD>
                        <SECTION>
                            <SECTNO>232.302</SECTNO>
                            <SUBJECT>Authority.</SUBJECT>
                            <P>(a) The use of guaranteed loans as a contract financing mechanism requires the availability of certain congressional authority. The DoD has not requested such authority in recent years, and none is now available.</P>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 232.4—Advance Payments for Other Than Commercial Acquisitions</HD>
                        <SECTION>
                            <SECTNO>232.404</SECTNO>
                            <SUBJECT>Exclusions.</SUBJECT>
                            <P>(a)(9) The requirements of FAR subpart 32.4 do not apply to advertisements in high school and college publications for military recruitment efforts under 10 U.S.C. 503 when the contract cost does not exceed the micro-purchase threshold.</P>
                            <CITA>[56 FR 36409, July 31, 1991, as amended at 70 FR 75413, Dec. 20, 2005; 71 FR 75892, Dec. 19, 2006; 75 FR 45074, Aug. 2, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.409</SECTNO>
                            <SUBJECT>Contracting officer action.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.409-1</SECTNO>
                            <SUBJECT>Recommendation for approval.</SUBJECT>
                            <P>Follow the procedures at PGI 232.409-1 for preparation of the documents required by FAR 32.409-1(e) and (f).</P>
                            <CITA>[70 FR 75413, Dec. 20, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.410</SECTNO>
                            <SUBJECT>Findings, determination, and authorization.</SUBJECT>
                            <P>If an advance payment procedure is used without a special bank account, follow the procedures at PGI 232.410.</P>
                            <CITA>[70 FR 75413, Dec. 20, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.412</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.412-70</SECTNO>
                            <SUBJECT>Additional clauses.</SUBJECT>
                            <P>(a) Use the clause at 252.232-7000, Advance Payment Pool, in any contract that will be subject to the terms of an advance payment pool agreement with a nonprofit organization or educational institution. Normally, use the clause in all cost reimbursement type contracts with the organization or institution.</P>
                            <P>(b) Use the clause at 252.232-7005, Reimbursement of Subcontractor Advance Payments-DoD Mentor-Protégé Program, when advance payments will be provided by the contractor to a subcontractor pursuant to an approved mentor-protégé agreement (see subpart 219.71).</P>
                            <CITA>[56 FR 36409, July 31, 1991, as amended at 56 FR 67217, Dec. 30, 1991; 85 FR 19699, Apr. 8, 2020; 89 FR 20876, Mar. 26, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.470</SECTNO>
                            <SUBJECT>Advance payment pool.</SUBJECT>
                            <P>(a) An advance payment pool agreement—</P>
                            <P>(1) Is a means of financing the performance of more than one contract held by a single contractor;</P>
                            <P>(2) Is especially convenient for the financing of cost-type contracts with nonprofit educational or research institutions for experimental or research and development work when several contracts require financing by advance payments. When appropriate, pooled advance payments may also be used to finance other types of contracts held by a single contractor; and</P>
                            <P>(3) May be established—</P>
                            <P>(i) Without regard to the number of appropriations involved;</P>
                            <P>(ii) To finance contracts for one or more department(s) or contracting activity(ies); or</P>
                            <P>(iii) In addition to any other advance payment pool agreement at a single contractor location when it is more convenient or otherwise preferable to have more than one agreement.</P>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 232.5—Progress Payments Based on Costs</HD>
                        <SECTION>
                            <SECTNO>232.501</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.501-1</SECTNO>
                            <SUBJECT>Customary progress payment rates.</SUBJECT>
                            <P>(a) The customary progress payment rates for DoD contracts, including contracts that contain foreign military sales (FMS) requirements, are 80 percent for large business concerns and 90 percent for small business concerns.</P>
                            <CITA>[79 FR 61582, Oct. 14, 2014]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="323"/>
                            <SECTNO>232.501-2</SECTNO>
                            <SUBJECT>Unusual progress payments.</SUBJECT>
                            <P>Follow the procedures at PGI 232.501-2 for approval of unusual progress payments.</P>
                            <CITA>[70 FR 75413, Dec. 20, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.501-3</SECTNO>
                            <SUBJECT>Contract price.</SUBJECT>
                            <P>(b) The contracting officer may approve progress payments when the contract price exceeds the funds obligated under the contract, provided the contract limits the Government's liability to the lesser of—</P>
                            <P>(i) The applicable rate (i.e., the lower of the progress payment rate, the liquidation rate, or the loss-ratio adjusted rate); or</P>
                            <P>(ii) 100 percent of the funds obligated.</P>
                            <CITA>[56 FR 36409, July 31, 1991, as amended at 65 FR 39722, June 27, 2000; 70 FR 75413, Dec. 20, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.502</SECTNO>
                            <SUBJECT>Preaward matters.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.502-4-70</SECTNO>
                            <SUBJECT>Additional clauses.</SUBJECT>
                            <P>(a) Use the clause at 252.232-7002, Progress Payments for Foreign Military Sales Acquisitions, in solicitations and contracts that—</P>
                            <P>(i) Contain FMS requirements; and</P>
                            <P>(ii) Provide for progress payments.</P>
                            <P>(b) Use the clause at 252.232-7004, DoD Progress Payment Rates, instead of Alternate I of the clause at FAR 52.232-16, if the contractor is a small business concern.</P>
                            <P>(c) Use the clause at 252.232-7018, Progress Payments—Multiple Lots, to authorize separate progress payment requests for multiple lots.</P>
                            <CITA>[56 FR 36409, July 31, 1991, as amended at 56 FR 67217, Dec. 30, 1991; 64 FR 8731, Feb. 23, 1999; 65 FR 39722, June 27, 2000; 66 FR 49865, Oct. 1, 2001; 79 FR 61582, Oct. 14, 2014; 88 FR 33833, May 25, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.503</SECTNO>
                            <SUBJECT>Postaward matters.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.503-6</SECTNO>
                            <SUBJECT>Suspension or reduction of payments.</SUBJECT>
                            <P>
                                (b) 
                                <E T="03">Contractor noncompliance.</E>
                                 See also 242.7503.
                            </P>
                            <P>
                                (g) 
                                <E T="03">Loss contracts.</E>
                                 Use the following loss ratio adjustment procedures for making adjustments required by FAR 32.503-6(f) and (g)—
                            </P>
                            <P>(i) Except as provided in paragraph (g)(ii) of this subsection, the contracting officer must prepare a supplementary analysis of the contractor's request for progress payments and calculate the loss ratio adjustment using the procedures in FAR 32.503-6(g).</P>
                            <P>(ii) The contracting officer may request the contractor to prepare the supplementary analysis as an attachment to the progress payment request when the contracting officer determines that the contractor's methods of estimating the “Costs to Complete” are reliable, accurate, and not susceptible to improper influences.</P>
                            <P>(iii) To maintain an audit trail and permit verification of calculations, do not make the loss ratio adjustments by altering or replacing data on the contractor's original request for progress payment (SF 1443, Contractor's Request for Progress Payment, or computer generated equivalent).</P>
                            <CITA>[56 FR 36409, July 31, 1991, as amended at 60 FR 29499, June 5, 1995; 65 FR 39722, June 27, 2000]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.503-15</SECTNO>
                            <SUBJECT>Application of Government title terms.</SUBJECT>
                            <P>(d) An administrative contracting officer (ACO) determination that the contractor's material management and accounting system conforms to the system criteria at 252.242-7004(d)(7) constitutes the contracting officer approval requirement of FAR 32.503-15(d). Prior to granting blanket approval of cost transfers between contracts, the ACO should determine that—</P>
                            <P>(i) The contractor retains records of the transfer activity that took place in the prior month;</P>
                            <P>(ii) The contractor prepares, at least monthly, a summary of the transfer activity that took place in the prior month; and</P>
                            <P>(iii) The summary report includes as a minimum, the total number and dollar value of transfers.</P>
                            <CITA>[56 FR 36409, July 31, 1991, as amended at 57 FR 42632, Sept. 15, 1992; 70 FR 75413, Dec. 20, 2005; 77 FR 11365, Feb. 24, 2012]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 232.6—Contract Debts</HD>
                        <SECTION>
                            <SECTNO>232.602</SECTNO>
                            <SUBJECT>Responsibilities.</SUBJECT>
                            <P>
                                (b) Disbursing officers are those officials designated to make payments 
                                <PRTPAGE P="324"/>
                                under a contract or to receive payments of amounts due under a contract. The disbursing officer is responsible for determining the amount and collecting contract debts whenever overpayments or erroneous payments have been made. The disbursing officer also has primary responsibility when the amounts due and dates for payment are contained in the contract, and a copy of the contract has been furnished to the disbursing officer with notice to collect as amounts become due.
                            </P>
                            <CITA>[56 FR 36409, July 31, 1991, as amended at 70 FR 75413, Dec. 20, 2005. Redesignated and amended at 80 FR 58633, Sept. 30, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.603</SECTNO>
                            <SUBJECT>Debt determination.</SUBJECT>
                            <P>When transferring a case to the contract financing office, follow the procedures at PGI 232.603.</P>
                            <CITA>[80 FR 58633, Sept. 30, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.604</SECTNO>
                            <SUBJECT>Demand for payment.</SUBJECT>
                            <P>When issuing a demand for payment of a contract debt, follow the procedures at PGI 232.604.</P>
                            <CITA>[80 FR 58633, Sept. 30, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.610</SECTNO>
                            <SUBJECT>Compromising debts.</SUBJECT>
                            <P>Only the department/agency contract financing offices (see PGI 232.070(c)) are authorized to compromise debts covered by this subpart. 232.617</P>
                            <CITA>[80 FR 58633, Sept. 30, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.611</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>(a) The Principal Director, Defense Pricing, Contracting, and Acquisition Policy, Office of the Under Secretary of Defense (Acquisition and Sustainment), may exempt the contracts in FAR 32.611(a)(2) through (5) and other contracts, in exceptional circumstances, from the administrative interest charges required by this subpart.</P>
                            <P>(7) Other exceptions are—</P>
                            <P>(A) Contracts for instructions of military or ROTC personnel at civilian schools, colleges, and universities;</P>
                            <P>(B) Basic agreements with telephone companies for communications services and facilities, and purchases under such agreements; and</P>
                            <P>(C) Transportation contracts with common carriers for common carrier services.</P>
                            <CITA>[70 FR 75413, Dec. 20, 2005. Redesignated and amended at 80 FR 58633, Sept. 30, 2015; 88 FR 73237, Oct. 25, 2023; 89 FR 60832, July 29, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.670</SECTNO>
                            <SUBJECT>Transfer of responsibility for debt collection.</SUBJECT>
                            <P>Follow the procedures at PGI 232.670 for transferring responsibility for debt collection.</P>
                            <CITA>[70 FR 75413, Dec. 20, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.671</SECTNO>
                            <SUBJECT>Bankruptcy reporting.</SUBJECT>
                            <P>Follow the procedures at PGI 232.671 for bankruptcy reporting.</P>
                            <CITA>[70 FR 75413, Dec. 20, 2005]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 232.7—Contract Funding</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>58 FR 46092, Sept. 1, 1993, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>232.702</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>Fixed-price contracts shall be fully funded except as permitted by 232.703-1.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.703</SECTNO>
                            <SUBJECT>Contract funding requirements.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.703-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>(1) A fixed-price contract may be incrementally funded only if—</P>
                            <P>(i) The contract (excluding any options) or any exercised option—</P>
                            <P>(A) Is for severable services;</P>
                            <P>(B) Does not exceed one year in length; and</P>
                            <P>(C) Is incrementally funded using funds available (unexpired) as of the date the funds are obligated; or</P>
                            <P>(ii) The contract uses funds available from multiple (two or more) fiscal years and—</P>
                            <P>(A) The contract is funded with research and development appropriations; or</P>
                            <P>(B) Congress has otherwise authorized incremental funding.</P>
                            <P>(2) An incrementally funded fixed-price contract shall be fully funded as soon as funds are available.</P>
                            <CITA>[71 FR 18673, Apr. 12, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="325"/>
                            <SECTNO>232.703-3</SECTNO>
                            <SUBJECT>Contracts crossing fiscal years.</SUBJECT>
                            <P>(b) The contracting officer may enter into a contract, exercise an option, or place an order under a contract for severable services for a period that begins in one fiscal year and ends in the next fiscal year if the period of the contract awarded, option exercised, or order placed does not exceed 1 year (10 U.S.C. 3133).</P>
                            <CITA>[64 FR 28110, May 25, 1999, as amended at 87 FR 76995, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.703-70</SECTNO>
                            <SUBJECT>Military construction appropriations act restriction.</SUBJECT>
                            <P>Annual military construction appropriations acts restrict the use of funds appropriated by the acts for payments under cost-plus-fixed-fee contracts (see 216.306(c)).</P>
                            <CITA>[61 FR 7744, Feb. 29, 1996]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.704</SECTNO>
                            <SUBJECT>Limitation of cost or funds.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.704-70</SECTNO>
                            <SUBJECT>Incrementally funded fixed-price contracts.</SUBJECT>
                            <P>(a) Upon receipt of the contractor's notice under paragraph (c) of the clause at 252.232-7007, Limitation of Government's Obligation, the contracting officer shall promptly provide written notice to the contractor that the Government is—</P>
                            <P>(1) Allotting additional funds for continued performance and increasing the Government's limitation of obligation in a specified amount;</P>
                            <P>(2) Terminating the contract; or</P>
                            <P>(3) Considering whether to allot additional funds; and</P>
                            <P>(i) The contractor is entitled by the contract terms to stop work when the Government's limitation of obligation is reached; and</P>
                            <P>(ii) Any costs expended beyond the Government's limitation of obligation are at the contractor's risk.</P>
                            <P>(b) Upon learning that the contract will receive no further funds, the contracting officer shall promptly give the contractor written notice of the Government's decision and terminate for the convenience of the Government.</P>
                            <P>(c) The contracting officer shall ensure that, in accordance with paragraph (b) of the clause at 252.232-7007, Limitation of Government's Obligation, sufficient funds are allotted to the contract to cover the total amount payable to the contractor in the event of termination for the convenience of the Government.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.706</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.706-70</SECTNO>
                            <SUBJECT>Clause for limitation of Government's obligation.</SUBJECT>
                            <P>Use the clause at 252.232-7007, Limitation of Government's Obligation, in solicitations and resultant incrementally funded fixed-price contracts. The contracting officer may revise the contractor's notification period, in paragraph (c) of the clause, from “ninety” to “thirty” or “sixty” days, as appropriate.</P>
                            <CITA>[58 FR 46092, Sept. 1, 1993. Redesignated at 86 FR 59870, Oct. 29, 2021]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 232.8—Assignment of Claims</HD>
                        <SECTION>
                            <SECTNO>232.803</SECTNO>
                            <SUBJECT>Policies.</SUBJECT>
                            <P>(b) Only contracts for personal services may prohibit the assignment of claims.</P>
                            <P>
                                (d) Pursuant to 41 U.S.C. 6305, and in accordance with Presidential delegation dated October 3, 1995, Secretary of Defense delegation dated February 5, 1996, and Under Secretary of Defense (Acquisition, Technology, and Logistics) delegation dated February 23, 1996, the Director of Defense Procurement determined on May 10, 1996, that a need exists for DoD to agree not to reduce or set off any money due or to become due under the contract when the proceeds under the contract have been assigned in accordance with the Assignment of Claims provision of the contract. This determination was published in the 
                                <E T="04">Federal Register</E>
                                 on June 11, 1996, as required by law. Nevertheless, if departments/agencies decide it is in the Government's interests, or if the contracting officer makes a determination in accordance with FAR 32.803(d) concerning a significantly indebted offeror, they may exclude the no-setoff commitment.
                            </P>
                            <CITA>[56 FR 36409, July 31, 1991, as amended at 61 FR 50454, Sept. 26, 1996; 65 FR 39706, June 27, 2000; 76 FR 58137, Sept. 20, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="326"/>
                            <SECTNO>232.805</SECTNO>
                            <SUBJECT>Procedure.</SUBJECT>
                            <P>(b) The assignee shall forward—</P>
                            <P>(i) To the administrative contracting officer (ACO), a true copy of the instrument of assignment and an original and three copies of the notice of assignment. The ACO shall acknowledge receipt by signing and dating all copies of the notice of assignment and shall—</P>
                            <P>(A) File the true copy of the instrument of assignment and the original of the notice in the contract file;</P>
                            <P>(B) Forward two copies of the notice to the disbursing officer of the payment office cited in the contract;</P>
                            <P>(C) Return a copy of the notice to the assignee; and</P>
                            <P>(D) Advise the contracting officer of the assignment.</P>
                            <P>(ii) To the surety or sureties, if any, a true copy of the instrument of assignment and an original and three copies of the notice of assignment. The surety shall return three acknowledged copies of the notice to the assignee, who shall forward two copies to the disbursing officer designated in the contract.</P>
                            <P>(iii) To the disbursing officer of the payment office cited in the contract, a true copy of the instrument of assignment and an original and one copy of the notice of assignment. The disbursing officer shall acknowledge and return to the assignee the copy of the notice and shall file the true copy of the instrument and original notice.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.806</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>(a)(1) Use the clause at 252.232-7008, Assignment of Claims (Overseas), instead of the clause at FAR 52.232-23, Assignment of Claims, in solicitations and contracts when contract performance will be in a foreign country.</P>
                            <P>(2) Use Alternate I with the clause at FAR 52.232-23, Assignment of Claims, unless otherwise authorized under 232.803(d).</P>
                            <CITA>[62 FR 34126, June 24, 1997]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 232.9—Prompt Payment</HD>
                        <SECTION>
                            <SECTNO>232.901</SECTNO>
                            <SUBJECT>Applicability.</SUBJECT>
                            <P>(1) Except for FAR 32.908, FAR subpart 32.9, Prompt Payment, does not apply when—</P>
                            <P>(i) There is—</P>
                            <P>(A) An emergency, as defined in the Disaster Relief Act of 1974;</P>
                            <P>
                                (B) A contingency operation (
                                <E T="03">see</E>
                                 FAR 2.101(b)); or
                            </P>
                            <P>(C) The release or threatened release of hazardous substances (as defined in 4 U.S.C. 9606, section 106); and</P>
                            <P>(ii) The head of the contracting activity has made a determination, after consultation with the cognizant comptroller, that conditions exist that limit normal business operations; and</P>
                            <P>
                                (iii) Payments will be made in the operational area or made contingent upon receiving supporting documentation (
                                <E T="03">i.e.,</E>
                                 contract, invoice, and receiving report) from the operational area.
                            </P>
                            <P>(2) Criteria limiting normal business operations during emergencies and contingency operations that restrict the use of FAR 32.9 may include such conditions as—</P>
                            <P>(i) Support infrastructure, hardware, communications capabilities, and bandwidth are not consistently available such that normal business operations can be carried out;</P>
                            <P>(ii) Support resources, facilities, and banking needs are not consistently available for use as necessary in carrying out normal business operations;</P>
                            <P>(iii) Military mission priorities override the availability of appropriately skilled personnel in support of back-office operations;</P>
                            <P>(iv) Mobility impairments and security concerns restrict free movement of personnel and documents necessary for timely processing;</P>
                            <P>
                                (v) Foreign vendors are not familiar with or do not understand DoD contract requirements (
                                <E T="03">i.e.,</E>
                                 proper invoice, receiving documentation, and contracting terms); or
                            </P>
                            <P>(vi) Documents received in support of payment requests and shipments require language translations that cannot be performed and documented within normal business processing times.</P>
                            <P>
                                (3) 
                                <E T="03">Subsequent Determinations.</E>
                                 The head of the contracting activity shall make subsequent determinations, after consultation with the cognizant comptroller, as the operational area evolves into either a more stable or less stable environment.
                            </P>
                            <P>
                                (i) If the head of the contracting activity determines that the operational 
                                <PRTPAGE P="327"/>
                                area has evolved into a more stable environment, the contracting officer shall notify, by issuance of a contract modification, each contractor performing in the operational area under review. The modification deactivates clause 252.232-7011 and activates the applicable FAR Prompt Payment clause in the contract.
                            </P>
                            <P>(ii) If after deactivation of clause 252.232-7011, the head of the contracting activity subsequently determines that the operational area has evolved into a less stable environment, the head of the contracting activity will make a determination that conditions exist that limit normal business operations. The contracting officer will then reactivate clause 252.232-7011 by issuance of a contract modification.</P>
                            <CITA>[75 FR 40713, July 13, 2010, as amended at 76 FR 11373, Mar. 2, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.903</SECTNO>
                            <SUBJECT>Responsibilities.</SUBJECT>
                            <P>In accordance with 10 U.S.C. 3801(b), DoD shall assist small business concerns by providing payment as quickly as possible, to the fullest extent permitted by law, with a goal of 15 days after receipt of proper invoices and all required documentation, including acceptance, and before normal payment due dates established in the contract (see 232.906(a)).</P>
                            <CITA>[85 FR 19697, Apr. 8, 2020, as amended at 87 FR 76995, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.904</SECTNO>
                            <SUBJECT>Determining payment due dates.</SUBJECT>
                            <P>(d) In most cases, Government acceptance or approval can occur within the 7-day constructive acceptance period specified in the FAR Prompt Payment clauses. Government payment of construction progress payments can, in most cases, be made within the 14-day period allowed by the Prompt Payment for Construction Contracts clause. While the contracting officer may specify a longer period because the period specified in the contract is not reasonable or practical, such change should be coordinated with the Government offices responsible for acceptance or approval and for payment. Reasons for specifying a longer period include but are not limited to: the nature of the work or supplies or services, inspection or testing requirements, shipping and acceptance terms, and resources available at the acceptance activity. A constructive acceptance period of less than the cited 7 or 14 days is not authorized.</P>
                            <CITA>[70 FR 75413, Dec. 20, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.905</SECTNO>
                            <SUBJECT>Payment documentation and process.</SUBJECT>
                            <P>(b)(1)(iii) For task and delivery orders numbered in accordance with FAR 4.1603 and 204.1603, the 13-character order number may serve as the contract number on invoices and receiving reports. The contract or agreement number under which the order was placed may be omitted from invoices and receiving reports. The contractor may choose to identify both the contract number and the 13-character order number on invoices and receiving reports. Task and delivery orders numbered with a four-position alpha-numeric call or order serial number shall include both the 13-position basic contract Procurement Instrument Identifier and the four-position order number.</P>
                            <CITA>[81 FR 9786, Feb. 26, 2016]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.906</SECTNO>
                            <SUBJECT>Making payments.</SUBJECT>
                            <P>(a)(i) Generally, the contracting officer shall insert the standard due date of 14 days for interim payments on cost-reimbursement contracts for services in the clause at FAR 52.232-25, Prompt Payment, when using the clause with its Alternate I.</P>
                            <P>(ii) The restrictions of FAR 32.906 prohibiting early payment do not apply to invoice payments made to small business concerns. However, contractors shall not be entitled to interest penalties if the Government fails to make early payment.</P>
                            <CITA>[70 FR 75413, Dec. 20, 2005, as amended at 76 FR 23506, Apr. 27, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.908</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>
                                Use the clause at 252.232-7011, Payments in Support of Emergencies and Contingency Operations, in solicitations and contracts, including solicitations and contracts using FAR part 12 
                                <PRTPAGE P="328"/>
                                procedures for the acquisition of commercial products and commercial services, in acquisitions that meet the applicability criteria at 232.901(1). Use of this clause is in addition to use of either the approved Payment clause prescribed in FAR 32.908 or the clause at FAR 52.212-4, Contract Terms and Conditions—Commercial Products and Commercial Services.
                            </P>
                            <CITA>[78 FR 37989, June 25, 2013, as amended at 88 FR 6587, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 232.10—Performance-Based Payments</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>63 FR 11537, Mar. 9, 1998, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>232.1001</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(a) As with all contract financing, the purpose of performance-based payments is to assist the contractor in the payment of costs incurred during the performance of the contract. See PGI 232.1001(a) for additional information on use of performance-based payments. However, in accordance with 10 U.S.C. 3802(a)(2), performance-based payments shall not be conditioned upon costs incurred in contract performance, but on the achievement of performance outcomes. Subject to the criteria in 232.1003-70, all companies, including nontraditional defense contractors, are eligible for performance-based payments, consistent with best commercial practices.</P>
                            <P>(d) The contracting officer shall use the following standard payment terms for performance-based payments: The contractor entitlement date, if any, specified in the contract, or 14 days after receipt by the designated billing office of a proper request for payment, whichever is later.</P>
                            <CITA>[63 FR 11537, Mar. 9, 1998, as amended at 79 FR 17936, Mar. 31, 2014; 85 FR 19688, Apr. 8, 2020; 87 FR 76995, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.1003-70</SECTNO>
                            <SUBJECT>Criteria for use.</SUBJECT>
                            <P>In accordance with 10 U.S.C. 3802(c)(1), a contractor's financial statements shall be in compliance with Generally Accepted Accounting Principles in order to receive performance-based payments. 10 U.S.C. 3802(c)(2) specifies that it does not grant the Defense Contract Audit Agency the authority to audit compliance with Generally Accepted Accounting Principles.</P>
                            <CITA>[85 FR 19688, Apr. 8, 2020, as amended at 87 FR 76995, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.1004</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>
                                (b) 
                                <E T="03">Establishing performance-based finance payment amounts.</E>
                                 (i) The contracting officer should include in a solicitation both the progress payments and performance-based payments provisions and clauses prescribed in this part, when considering both types of payment methods. Only one type of financing will be included in the resultant contract, except as may be authorized on separate orders subject to FAR 32.1003(c)).
                            </P>
                            <P>
                                (ii) The contracting officer shall analyze the performance-based payment schedule using the performance-based payments (PBP) analysis tool. The PBP analysis tool is on the Defense Pricing, Contracting, and Acquisition Policy website in the Price, Cost and Finance section. The PBP analysis tool and Performance Based Payments Guidebook are available at 
                                <E T="03">https://www.acq.osd.mil/asda/dpc/pcf/pricing-topics.html#pdp.</E>
                            </P>
                            <P>(A) When considering performance-based payments, obtain from the offeror/contractor a proposed performance-based payments schedule that includes all performance-based payments events, completion criteria and event values along with the projected monthly expenditure profile in order to negotiate the value of the performance events such that the performance-based payments are not expected to result in an unreasonably low or negative level of contractor investment in the contract. If performance-based payments are deemed practical, the Government will evaluate and negotiate the details of the performance-based payments schedule.</P>
                            <P>(B) For modifications to contracts that already use performance-based payments financing, the basis for negotiation must include performance-based payments. The PBP analysis tool will be used in the same manner to help determine the price for the modification.</P>
                            <P>
                                (iii) The contracting officer shall document in the contract file that the 
                                <PRTPAGE P="329"/>
                                performance-based payment schedule provides a mutually beneficial settlement position that reflects adequate consideration to the Government for the improved contractor cash flow.
                            </P>
                            <P>
                                (c) 
                                <E T="03">Instructions for multiple appropriations.</E>
                                 If the contract contains foreign military sales requirements, the contracting officer shall provide instructions for distribution of the contract financing payments to each country's account.
                            </P>
                            <CITA>[63 FR 11537, Mar. 9, 1998, as amended at 79 FR 17936, Mar. 31, 2014; 85 FR 19688, Apr. 8, 2020; 87 FR 15818, Mar. 18, 2022; 89 FR 60832, July 29, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.1005-70</SECTNO>
                            <SUBJECT>Solicitation provisions and contract clauses.</SUBJECT>
                            <P>(a) The contracting officer shall include the following clauses with appropriate fill-ins in solicitations and contracts that include performance-based payments:</P>
                            <P>(1) For performance-based payments made on a whole-contract basis, use the clause at 252.232-7012, Performance-Based Payments—Whole-Contract Basis.</P>
                            <P>(2) For performance-based payments made on a deliverable-item basis, use the clause at 252.232-7013, Performance-Based Payments—Deliverable-Item Basis.</P>
                            <P>(b) Use the provision at 252.232-7015, Performance-Based Payments—Representation, in solicitations where the resulting contract may include performance-based payments.</P>
                            <P>(c) Use the provision at 252.232-7016, Notice of Progress Payments or Performance-Based Payments, in lieu of FAR 52.232-13, Notice of Progress Payments, when the solicitation contains clauses for progress payments and performance-based payments (only one type of financing will be included in the resultant contract, except as may be authorized on separate orders subject to FAR 32.1003(c)).</P>
                            <CITA>[79 FR 17936, Mar. 31, 2014, as amended at 85 FR 19688, Apr. 8, 2020]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 232.11—Electronic Funds Transfer</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>65 FR 46626, July 31, 2000, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>232.1108</SECTNO>
                            <SUBJECT>Payment by Governmentwide commercial purchase card.</SUBJECT>
                            <CITA>[87 FR 65517, Oct. 28, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.1108-70</SECTNO>
                            <SUBJECT>Prohibition of Governmentwide commercial purchase card as a method of payment when the tax on certain foreign procurements applies.</SUBJECT>
                            <P>The contracting officer shall not authorize the Governmentwide commercial purchase card as a method of payment during any contract period of performance if the contract includes the clause at FAR 52.229-12, Tax on Certain Foreign Procurements, unless the contract also includes the clause at 252.229-7014, Full Exemption from Two-Percent Excise Tax on Certain Foreign Procurements, indicating that the contractor is fully exempt from the tax.</P>
                            <CITA>[87 FR 65517, Oct. 28, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.1110</SECTNO>
                            <SUBJECT>Solicitation provision and contract clauses.</SUBJECT>
                            <P>Use the clause at 252.232-7009, Mandatory Payment by Governmentwide Commercial Purchase Card, in solicitations, contracts, and agreements, including solicitations, contracts, and agreements using FAR part 12 procedures for the acquisition of commercial products and commercial services, when—</P>
                            <P>(1) Placement of orders or calls valued at or below the micro-purchase threshold is anticipated; and</P>
                            <P>(2) Payment by Governmentwide commercial purchase card is required for orders or calls valued at or below the micro-purchase threshold under the contract or agreement.</P>
                            <CITA>[78 FR 37989, June 25, 2013, as amended at 88 FR 6587, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 232.70—Electronic Submission and Processing of Payment Requests and Receiving Reports</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>68 FR 8455, Feb. 21, 2003, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <PRTPAGE P="330"/>
                            <SECTNO>232.7000</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>This subpart prescribes policies and procedures for submitting and processing payment requests in electronic form to comply with 10 U.S.C. 4601.</P>
                            <CITA>[68 FR 8455, Feb. 21, 2003, as amended at 87 FR 76995, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.7001</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this subpart—</P>
                            <P>
                                <E T="03">Electronic form</E>
                                 means any automated system that transmits information electronically from the initiating system to affected systems.
                            </P>
                            <P>
                                <E T="03">Payment request</E>
                                 means any request for contract financing payment or invoice payment submitted by the contractor under a contract or task or delivery order.
                            </P>
                            <P>
                                <E T="03">Receiving report</E>
                                 means the data prepared in the manner and to the extent required by appendix F of this chapter, Material Inspection and Receiving Report.
                            </P>
                            <CITA>[83 FR 66063, Dec. 21, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.7002</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(a) Payment requests and receiving reports are required to be submitted in electronic form, except for—</P>
                            <P>(1) Classified contracts or purchases when electronic submission and processing of payment requests and receiving reports could compromise the safeguarding of classified information or national security;</P>
                            <P>
                                (2) Cases in which contractor submission of electronic payment requests and receiving reports is not feasible (
                                <E T="03">e.g.,</E>
                                 when contract performance is in an environment where internet connectivity is not available);
                            </P>
                            <P>(3) Cases in which DoD is unable to receive payment requests or provide acceptance in electronic form;</P>
                            <P>
                                (4) Cases in which the contractor has requested permission in writing to submit payment requests and receiving reports by nonelectronic means, and the contracting officer has provided instructions for a temporary alternative method of submission of payment requests and receiving reports in the contract administration data section of the contract or task or delivery order (
                                <E T="03">e.g.,</E>
                                 section G, an addendum to FAR 52.212-4, or applicable clause); and
                            </P>
                            <P>(5) When the Governmentwide commercial purchase card is used as the method of payment, in which case only submission of the receiving report in electronic form is required.</P>
                            <P>
                                (b)(1) The only acceptable electronic form for submission of payment requests and receiving reports is Wide Area WorkFlow (WAWF) (
                                <E T="03">https://wawf.eb.mil/</E>
                                ), except as follows:
                            </P>
                            <P>
                                (i) For payment of commercial transportation services provided under a Government rate tender, contract, or task or delivery order for transportation services, the use of a DoD-approved electronic third party payment system or other exempted vendor payment/invoicing system (
                                <E T="03">e.g.,</E>
                                 PowerTrack, Transportation Financial Management System, and Cargo and Billing System) is permitted.
                            </P>
                            <P>(ii) For submitting and processing payment requests and receiving reports for contracts or task or delivery orders for rendered health care services, the use of TRICARE Encounter Data System as the electronic form is permitted.</P>
                            <P>(2) Facsimile, email, and scanned documents are not acceptable electronic forms of payment requests or receiving reports.</P>
                            <CITA>[83 FR 66063, Dec. 21, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.7003</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>(a) DoD officials receiving payment requests in electronic form shall process the payment requests in electronic form. The WAWF system provides the method to electronically process payment requests and receiving reports.</P>
                            <P>(1) Documents necessary for payment, such as receiving reports, invoice approvals, contracts, contract modifications, and required certifications, shall also be processed in electronic form.</P>
                            <P>(2) Scanned documents and other commonly used file formats are only acceptable for processing supporting documentation.</P>
                            <P>(b) If one of the exceptions to submission in electronic form at 232.7002(a) applies, the contracting officer shall—</P>
                            <P>
                                (1) Consult the payment office and the contract administration office regarding the alternative method to be 
                                <PRTPAGE P="331"/>
                                used for submission of payment requests or receiving reports (
                                <E T="03">e.g.,</E>
                                 facsimile or conventional mail); and
                            </P>
                            <P>
                                (2) Provide procedures for invoicing in the contract administration data section of the contract or task or delivery order (
                                <E T="03">e.g.,</E>
                                 section G, an addendum to FAR 52.212-4, or applicable clause) for submission of invoices by nonelectronic means. If submission of invoices by nonelectronic means is temporary, the procedures should specify the time period for which they apply.
                            </P>
                            <CITA>[83 FR 66063, Dec. 21, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.7004</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>(a) Unless an exception to submission in electronic form at 232.7002(a) applies and instructions for invoices are contained in the contract administration data section of the contract, task order, or delivery order, use the clause at 252.232-7003, Electronic Submission of Payment Requests and Receiving Reports, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services.</P>
                            <P>(b) Use the clause at 252.232-7006, Wide Area WorkFlow Payment Instructions, in solicitations and contracts, task orders, or delivery orders, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, when 252.232-7003 is used and none of the exceptions at 232.7002(b)(1) apply. See PGI 232.7004 for instructions on completing the clause.</P>
                            <CITA>[83 FR 66063, Dec. 21, 2018, as amended at 88 FR 6587, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 232.71—Levies on Contract Payments</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>70 FR 52032, Sept. 1, 2005, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>232.7100</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>This subpart prescribes policies and procedures concerning the effect of levies pursuant to 26 U.S.C. 6331(h) on contract payments. The Internal Revenue Service (IRS) is authorized to levy up to 100 percent of all payments made under a DoD contract, up to the amount of the tax debt.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.7101</SECTNO>
                            <SUBJECT>Policy and procedures.</SUBJECT>
                            <P>(a) The contracting officer shall require the contractor to—</P>
                            <P>(1) Promptly notify the contracting officer when a levy may result in an inability to perform the contract; and</P>
                            <P>(2) Advise the contracting officer whether the inability to perform may adversely affect national security.</P>
                            <P>(b) The contracting officer shall promptly notify the Principal Director, Defense Pricing, Contracting, and Acquisition Policy (DPCAP), when the contractor's inability to perform will adversely affect national security or will result in significant additional costs to the Government. Follow the procedures at PGI 232.7101(b) for reviewing the contractor's rationale and submitting the required notification.</P>
                            <P>(c) The Principal Director, DPCAP, will promptly evaluate the contractor's rationale and will notify the IRS, the contracting officer, and the payment office, as appropriate, in accordance with the procedures at PGI 232.7101(c).</P>
                            <P>(d) The contracting officer shall then notify the contractor in accordance with paragraph (c) of the clause at 252.232-7010 and in accordance with the procedures at PGI 232.7101(d).</P>
                            <CITA>[71 FR 69492, Dec. 1, 2006, as amended at 88 FR 73237, Oct. 25, 2023; 89 FR 60832, July 29, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>232.7102</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at 252.232-7010, Levies on Contract Payments, in all solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services.</P>
                            <CITA>[71 FR 69492, Dec. 1, 2006, as amended at 78 FR 37989, June 25, 2013; 88 FR 6587, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <RESERVED>Subpart 232.72 [Reserved]</RESERVED>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 233</EAR>
                    <HD SOURCE="HED">PART 233—PROTESTS, DISPUTES, AND APPEALS</HD>
                    <CONTENTS>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 233.1—Protests</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>233.102</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>233.104</SECTNO>
                            <SUBJECT>Protests to GAO.</SUBJECT>
                            <SECTNO>233.170</SECTNO>
                            <SUBJECT>
                                Briefing requirement for protested acquisitions valued at $1 billion or more.
                                <PRTPAGE P="332"/>
                            </SUBJECT>
                            <SECTNO>233.171</SECTNO>
                            <SUBJECT>Reporting requirement for protests of solicitations or awards.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 233.2—Disputes and Appeals</HD>
                            <SECTNO>233.204-70</SECTNO>
                            <SUBJECT>Limitations on payment.</SUBJECT>
                            <SECTNO>233.210</SECTNO>
                            <SUBJECT>Contracting officer's authority.</SUBJECT>
                            <SECTNO>233.215</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <SECTNO>233.215-70</SECTNO>
                            <SUBJECT>Additional contract clause.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36416, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 233.1—Protests</HD>
                        <SECTION>
                            <SECTNO>233.102</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>If the Government exercises the authority provided in 239.7305(d) to limit disclosure of information, no action undertaken by the Government under such authority shall be subject to review in a bid protest before the GAOor in any Federal court (see subpart 239.73).</P>
                            <CITA>[78 FR 69271, Nov. 18, 2013, as amended at 87 FR 15811, Mar. 18, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>233.104</SECTNO>
                            <SUBJECT>Protests to GAO.</SUBJECT>
                            <P>
                                (c) 
                                <E T="03">Protests after award.</E>
                                 (1) In lieu of the time periods in FAR 33.104(c)(1), contracting officers shall immediately suspend performance or terminate the awarded contract, task order, or delivery order upon notice from the GAO of a protest filed within the time periods listed in paragraphs (c)(1)(A) through (D) of this section, whichever is later, except as provided in FAR 33.104(c)(2) and (3)—
                            </P>
                            <P>(A) Within 10 days after the date of contract award;</P>
                            <P>(B) Within 10 days after the date a task order or delivery order is issued, where the value exceeds $25 million (10 U.S.C. 3406(f));</P>
                            <P>(C) Within 5 days after a debriefing date offered to the protestor under a timely debriefing request in accordance with FAR 15.506 regardless of whether the protestor rejected the offered debriefing date, unless an earlier debriefing date is negotiated as a result; or</P>
                            <P>(D) Within 5 days after a postaward debriefing under FAR 15.506 is concluded in accordance with 215.506-70(b).</P>
                            <CITA>[87 FR 15811, Mar. 18, 2022, as amended at 87 FR 76995, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>233.170</SECTNO>
                            <SUBJECT>Briefing requirement for protested acquisitions valued at $1 billion or more.</SUBJECT>
                            <P>Follow the procedures at PGI 233.170 for briefing protested acquisitions valued at $1 billion or more.</P>
                            <CITA>[76 FR 3537, Jan. 20, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>233.171</SECTNO>
                            <SUBJECT>Reporting requirement for protests of solicitations or awards.</SUBJECT>
                            <P>Follow the procedures at PGI 233.171 for reporting information on protests involving the same contract award or proposed award that have been filed at both the GAO and the United States Court of Federal Claims.</P>
                            <CITA>[84 FR 25194, May 31, 2019, as amended at 87 FR 15811, Mar. 18, 2022]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 233.2—Disputes and Appeals</HD>
                        <SECTION>
                            <SECTNO>233.204-70</SECTNO>
                            <SUBJECT>Limitations on payment.</SUBJECT>
                            <P>See 10 U.S.C. 3862 for limitations on Congressionally directed payment of a claim under 41 U.S.C. chapter 71 (Contract Disputes), a request for equitable adjustment to contract terms, or a request for relief under Public Law 85-804.</P>
                            <CITA>[63 FR 11537, Mar. 9, 1998, as amended at 77 FR 35881, June 15, 2012; 87 FR 76995, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>233.210</SECTNO>
                            <SUBJECT>Contracting officer's authority.</SUBJECT>
                            <P>See PGI 233.210 for guidance on reviewing a contractor's claim.</P>
                            <CITA>[72 FR 6485, Feb. 12, 2007]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>233.215</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>Use Alternate I of the clause at FAR 52.233-1, Disputes, when—</P>
                            <P>(1) The acquisition is for—</P>
                            <P>(i) Aircraft</P>
                            <P>(ii) Spacecraft and launch vehicles</P>
                            <P>(iii) Naval vessels</P>
                            <P>(iv) Missile systems</P>
                            <P>(v) Tracked combat vehicles</P>
                            <P>(vi) Related electronic systems;</P>
                            <P>(2) The contracting officer determines that continued performance is—</P>
                            <P>(i) Vital to the national security, or</P>
                            <P>
                                (ii) Vital to the public health and welfare; or
                                <PRTPAGE P="333"/>
                            </P>
                            <P>(3) The head of the contracting activity determines that continued performance is necessary pending resolution of any claim that might arise under or be related to the contract.</P>
                            <CITA>[56 FR 36416, July 31, 1991. Redesignated at 62 FR 34126, June 24, 1997]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>233.215-70</SECTNO>
                            <SUBJECT>Additional contract clause.</SUBJECT>
                            <P>Use the clause at 252.233-7001, Choice of Law (Overseas), in solicitations and contracts when contract performance will be outside the United States and its outlying areas, unless otherwise provided for in a government-to-government agreement.</P>
                            <CITA>[70 FR 35545, June 21, 2005]</CITA>
                        </SECTION>
                    </SUBPART>
                </PART>
            </SUBCHAP>
            <SUBCHAP TYPE="P">
                <PRTPAGE P="334"/>
                <HD SOURCE="HED">SUBCHAPTER F—SPECIAL CATEGORIES OF CONTRACTING</HD>
                <PART>
                    <EAR>Pt. 234</EAR>
                    <HD SOURCE="HED">PART 234—MAJOR SYSTEM ACQUISITION</HD>
                    <CONTENTS>
                        <SECHD>Sec.</SECHD>
                        <SECTNO>234.001</SECTNO>
                        <SUBJECT>Definitions.</SUBJECT>
                        <SECTNO>234.003</SECTNO>
                        <SUBJECT>Responsibilities.</SUBJECT>
                        <SECTNO>234.004</SECTNO>
                        <SUBJECT>Acquisition strategy.</SUBJECT>
                        <SECTNO>234.005</SECTNO>
                        <SUBJECT>General requirements.</SUBJECT>
                        <SECTNO>234.005-1</SECTNO>
                        <SUBJECT>Competition.</SUBJECT>
                        <SECTNO>234.005-2</SECTNO>
                        <SUBJECT>Mission-oriented solicitation.</SUBJECT>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 234.2—Earned Value Management System</HD>
                            <SECTNO>234.201</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>234.203</SECTNO>
                            <SUBJECT>Solicitation provisions and contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 234.70—Acquisition of Major Weapon Systems as Commercial Products</HD>
                            <SECTNO>234.7000</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>234.7001</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <SECTNO>234.7002</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 234.71—Cost and Software Data Reporting</HD>
                            <SECTNO>234.7100</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>234.7101</SECTNO>
                            <SUBJECT>Solicitation provision and contract clause.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SECTION>
                        <SECTNO>234.001</SECTNO>
                        <SUBJECT>Definitions.</SUBJECT>
                        <P>As used in this subpart—</P>
                        <P>
                            <E T="03">Acceptable earned value management system</E>
                             and 
                            <E T="03">earned value management system</E>
                             are defined in the clause at 252.234-7002, Earned Value Management System.
                        </P>
                        <P>
                            <E T="03">Production of major defense acquisition program</E>
                             means the production and deployment of a major system that is intended to achieve an operational capability that satisfies mission needs, or an activity otherwise defined as Milestone C under Department of Defense Instruction 5000.02 or related authorities.
                        </P>
                        <P>
                            <E T="03">Significant deficiency</E>
                             is defined in the clause at 252.234-7002, Earned Value Management System, and is synonymous with 
                            <E T="03">noncompliance.</E>
                        </P>
                        <CITA>[76 FR 28867, May 18, 2011, as amended at 79 FR 4632, Jan. 29, 2014]</CITA>
                    </SECTION>
                    <SECTION>
                        <SECTNO>234.003</SECTNO>
                        <SUBJECT>Responsibilities.</SUBJECT>
                        <P>DoDD 5000.01, The Defense Acquisition System, and DoDI 5000.02, Operation of the Adaptive Acquisition Framework, contain the DoD implementation of OMB Circular A-109 and OMB Circular A-11.</P>
                        <CITA>[70 FR 14575, Mar. 23, 2005, as amended at 76 FR 76320, Dec. 7, 2011; 88 FR 80466, Nov. 17, 2023]</CITA>
                    </SECTION>
                    <SECTION>
                        <SECTNO>234.004</SECTNO>
                        <SUBJECT>Acquisition strategy.</SUBJECT>
                        <P>(1) See 209.570 for policy applicable to acquisition strategies that consider the use of lead system integrators.</P>
                        <P>
                            (2) 
                            <E T="03">Contract type.</E>
                        </P>
                        <P>(i) In accordance with section 818 of the National Defense Authorization Act for Fiscal Year 2007 (Pub. L. 109-364), for major defense acquisition programs at Milestone B—</P>
                        <P>(A) The milestone decision authority shall select, with the advice of the contracting officer, the contract type for a development program at the time of Milestone B approval or, in the case of a space program, Key Decision Point B approval;</P>
                        <P>(B) The basis for the contract type selection shall be documented in the acquisition strategy. The documentation—</P>
                        <P>
                            (
                            <E T="03">1</E>
                            ) Shall include an explanation of the level of program risk; and
                        </P>
                        <P>
                            (
                            <E T="03">2</E>
                            ) If program risk is determined to be high, shall outline the steps taken to reduce program risk and the reasons for proceeding with Milestone B approval despite the high level of program risk; and
                        </P>
                        <P>(C) If a cost-reimbursement type contract is selected, the contract file shall include the milestone decision authority's written determination that—</P>
                        <P>
                            (
                            <E T="03">1</E>
                            ) The program is so complex and technically challenging that it would not be practicable to reduce program risk to a level that would permit the use of a fixed-price type contract; and
                        </P>
                        <P>
                            (
                            <E T="03">2</E>
                            ) The complexity and technical challenge of the program is not the result of a failure to meet the requirements of 10 U.S.C. 4251.
                            <PRTPAGE P="335"/>
                        </P>
                        <P>(ii) In accordance with section 811 of the National Defense Authorization Act for Fiscal Year 2013 (Pub. L. 112-239), the contracting officer shall—</P>
                        <P>(A) Not use cost-reimbursement line items for the acquisition of production of major defense acquisition programs, unless the Under Secretary of Defense for Acquisition and Sustainment (USD(A&amp;S)), or the milestone decision authority when the milestone decision authority is the service acquisition executive of the military department that is managing the program, submits to the congressional defense committees—</P>
                        <P>
                            (
                            <E T="03">1</E>
                            ) A written certification that the particular cost-reimbursement line items are needed to provide a required capability in a timely and cost effective manner; and
                        </P>
                        <P>
                            (
                            <E T="03">2</E>
                            ) An explanation of the steps taken to ensure that cost-reimbursement line items are used only to achieve the purposes of the exception; and
                        </P>
                        <P>(B) Include a copy of such congressional certification in the contract file.</P>
                        <P>(iii) See 216.301-3 for additional contract type approval requirements for cost-reimbursement contracts.</P>
                        <P>(iv) For fixed-price incentive (firm target) contracts, contracting officers shall comply with the guidance provided at PGI 216.403-1(1)(ii)(B) and (C).</P>
                        <P>(v) In accordance with section 808 of the National Defense Authorization Act for Fiscal Year 2023 (Pub. L. 117-263)—</P>
                        <P>(A) The contracting officer shall not procure more than one lot for low-rate initial production, as defined at 10 U.S.C. 4231, associated with a major defense acquisition program if—</P>
                        <P>
                            (
                            <E T="03">1</E>
                            ) The milestone decision authority authorizes the use of a fixed-price type contract at the time of Milestone B approval; and
                        </P>
                        <P>
                            (
                            <E T="03">2</E>
                            ) The scope of work of the fixed-price type contract includes both the development and low-rate initial production of items for such major defense acquisition program; and
                        </P>
                        <P>(B) This limitation may be waived by the service acquisition executive for the department concerned, delegable to no lower than one level above the contracting officer, if—</P>
                        <P>
                            (
                            <E T="03">1</E>
                            ) A written notification of the waiver, including associated rationale, is provided to the congressional defense committees no later than 30 days after issuance of the waiver in accordance with agency procedures; and
                        </P>
                        <P>
                            (
                            <E T="03">2</E>
                            ) A copy of the waiver and such congressional notification are included in the contract file.
                        </P>
                        <P>(3) The contracting officer shall include in solicitations for contracts for the technical maturation and risk reduction phase, engineering and manufacturing development phase or production phase of a weapon system, including embedded software—</P>
                        <P>(i) Clearly defined measurable criteria for engineering activities and design specifications for reliability and maintainability provided by the program manager, or the comparable requiring activity official performing program management responsibilities; or</P>
                        <P>(ii) Ensure a copy of the justification, executed by the program manager or the comparable requiring activity official performing program management responsibilities for the decision that engineering activities and design specifications for reliability and maintainability should not be a requirement, is included in the contract file (10 U.S.C. 4328).</P>
                        <CITA>[73 FR 4118, Jan. 24, 2008, as amended at 79 FR 4632, Jan. 29, 2014; 79 FR 23278, Apr. 28, 2014; 79 FR 58694, Sept. 30, 2014; 84 FR 58334, Oct. 31, 2019, 84 FR 65307, Nov. 27, 2019; 87 FR 76995, Dec. 16, 2022; 88 FR 55940, Aug. 17, 2023; 89 FR 31657, Apr. 25, 2024]</CITA>
                    </SECTION>
                    <SECTION>
                        <SECTNO>234.005</SECTNO>
                        <SUBJECT>General requirements.</SUBJECT>
                    </SECTION>
                    <SECTION>
                        <SECTNO>234.005-1</SECTNO>
                        <SUBJECT>Competition.</SUBJECT>
                        <P>A contract that is initially awarded from the competitive selection of a proposal resulting from a broad agency announcement (see 235.016) may contain a contract line item or contract option using funds not limited to those identified in 235.016 for the development and demonstration or initial production of technology developed under the contract, or the delivery of initial or additional items if the item or a prototype thereof is created as the result of work performed under the contract, only when it adheres to the following limitations:</P>
                        <P>
                            (1) The contract line item or contract option shall be limited to the delivery 
                            <PRTPAGE P="336"/>
                            of the minimal amount of initial or additional items or prototypes that will allow for timely competitive solicitation and award of a follow-on development or production contract for those items.
                        </P>
                        <P>(2) The term of the contract line item or contract option shall be for not more than 2 years.</P>
                        <P>(3) The dollar value of the work to be performed pursuant to the contract line item or contract option shall not exceed $100 million in fiscal year 2017 constant dollars. (10 U.S.C. 4004)</P>
                        <P>(4) See PGI 234.005-1 for guidance on providing, upon request, the benefits derived from use of this competitive selection method.</P>
                        <CITA>[75 FR 32639, June 8, 2010, as amended at 81 FR 17045, Mar. 25, 2016; 84 FR 4365, Feb. 15, 2019; 87 FR 25145, Apr. 28, 2022; 87 FR 76995, Dec. 16, 2022; 88 FR 80466, Nov. 17, 2023]</CITA>
                    </SECTION>
                    <SECTION>
                        <SECTNO>234.005-2</SECTNO>
                        <SUBJECT> Mission-oriented solicitation.</SUBJECT>
                        <P>See 215.101-2-70(b)(2) for the prohibition on the use of the lowest price technically acceptable source selection process for engineering and manufacturing development of a major defense acquisition program for which budgetary authority is requested beginning in fiscal year 2019.</P>
                        <CITA>[84 FR 50789, Sept. 26, 2019]</CITA>
                    </SECTION>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 234.2—Earned Value Management System</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>73 FR 21848, Apr. 23, 2008, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>234.201</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(1) DoD applies the earned value management system requirement as follows:</P>
                            <P>(i) For cost or incentive contracts and subcontracts valued at $20,000,000 or more, the earned value management system shall comply with the guidelines in the American National Standards Institute/Electronic Industries Alliance Standard 748, Earned Value Management Systems (ANSI/EIA-748).</P>
                            <P>(ii) For cost or incentive contracts and subcontracts valued at $50,000,000 or more, the contractor shall have an earned value management system that has been determined by the cognizant Federal agency to be in compliance with the guidelines in ANSI/EIA-748.</P>
                            <P>(iii) For cost or incentive contracts and subcontracts valued at less than $20,000,000—</P>
                            <P>(A) The application of earned value management is optional and is a risk-based decision;</P>
                            <P>(B) A decision to apply earned value management shall be documented in the contract file; and</P>
                            <P>(C) Follow the procedures at PGI 234.201(1)(iii) for conducting a cost-benefit analysis.</P>
                            <P>(iv) For firm-fixed-price contracts and subcontracts of any dollar value—</P>
                            <P>(A) The application of earned value management is discouraged; and</P>
                            <P>(B) Follow the procedures at PGI 234.201(1)(iv) for obtaining a waiver before applying earned value management.</P>
                            <P>(2) When an offeror proposes a plan for compliance with the earned value management system guidelines in ANSI/EIA-748, follow the review procedures at PGI 234.201(2).</P>
                            <P>(3) The Defense Contract Management Agency is responsible for determining earned value management system compliance when DoD is the cognizant Federal agency.</P>
                            <P>(4) See PGI 234.201(3) for additional guidance on earned value management.</P>
                            <P>(5) The cognizant contracting officer, in consultation with the functional specialist and auditor, shall—</P>
                            <P>(i) Determine the acceptability of the contractor's earned value management system and approve or disapprove the system; and</P>
                            <P>(ii) Pursue correction of any deficiencies.</P>
                            <P>(6) In evaluating the acceptability of a contractor's earned value management system, the contracting officer, in consultation with the functional specialist and auditor, shall determine whether the contractor's earned value management system complies with the system criteria for an acceptable earned value management system as prescribed in the clause at 252.234-7002, Earned Value Management System.</P>
                            <P>
                                (7) 
                                <E T="03">Disposition of findings</E>
                                —(i) 
                                <E T="03">Reporting of findings.</E>
                                 The functional specialist or auditor shall document findings and recommendations in a report 
                                <PRTPAGE P="337"/>
                                to the contracting officer. If the functional specialist or auditor identifies any significant deficiencies in the contractor's earned value management system, the report shall describe the deficiencies in sufficient detail to allow the contracting officer to understand the deficiencies.
                            </P>
                            <P>
                                (ii) 
                                <E T="03">Initial determination.</E>
                                 (A) The contracting officer shall review all findings and recommendations and, if there are no significant deficiencies, shall promptly notify the contractor, in writing, that the contractor's earned value management system is acceptable and approved; or
                            </P>
                            <P>(B) If the contracting officer finds that there are one or more significant deficiencies (as defined in the clause at 252.234-7002, Earned Value Management System) due to the contractor's failure to meet one or more of the earned value management system criteria in the clause at 252.234-7002, the contracting officer shall—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Promptly make an initial written determination on any significant deficiencies and notify the contractor, in writing, providing a description of each significant deficiency in sufficient detail to allow the contractor to understand the deficiencies;
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Request the contractor to respond, in writing, to the initial determination within 30 days; and
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) Evaluate the contractor's response to the initial determination, in consultation with the auditor or functional specialist, and make a final determination.
                            </P>
                            <P>
                                (iii) 
                                <E T="03">Final determination.</E>
                                 (A) The contracting officer shall make a final determination and notify the contractor, in writing, that—
                            </P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) The contractor's earned value management system is acceptable and approved, and no significant deficiencies remain, or
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Significant deficiencies remain. The notice shall identify any remaining significant deficiencies, and indicate the adequacy of any proposed or completed corrective action. The contracting officer shall—
                            </P>
                            <P>
                                (
                                <E T="03">i</E>
                                ) Request that the contractor, within 45 days of receipt of the final determination, either correct the deficiencies or submit an acceptable corrective action plan showing milestones and actions to eliminate the deficiencies;
                            </P>
                            <P>
                                (
                                <E T="03">ii</E>
                                ) Disapprove the system in accordance with the clause at 252.234-7002, Earned Value Management System, when initial validation is not successfully completed within the timeframe approved by the contracting officer, or the contracting officer determines that the existing earned value management system contains one or more significant deficiencies in high-risk guidelines in ANSI/EIA-748 standards (guidelines 1, 3, 6, 7, 8, 9, 10, 12, 16, 21, 23, 26, 27, 28, 30, or 32). When the contracting officer determines that the existing earned value management system contains one or more significant deficiencies in one or more of the remaining 16 guidelines in ANSI/EIA-748 standards, the contracting officer shall use discretion to disapprove the system based on input received from functional specialists and the auditor; and
                            </P>
                            <P>
                                (
                                <E T="03">iii</E>
                                ) Withhold payments in accordance with the clause at 252.242-7005, Contractor Business Systems, if the clause is included in the contract.
                            </P>
                            <P>(B) Follow the procedures relating to monitoring a contractor's corrective action and the correction of significant deficiencies at PGI 234.201(7).</P>
                            <P>
                                (8) 
                                <E T="03">System approval.</E>
                                 The contracting officer shall promptly approve a previously disapproved earned value management system and notify the contractor when the contracting officer determines that there are no remaining significant deficiencies.
                            </P>
                            <P>
                                (9) 
                                <E T="03">Contracting officer notifications.</E>
                                 The cognizant contracting officer shall promptly distribute copies of a determination to approve a system, disapprove a system and withhold payments, or approve a previously disapproved system and release withheld payments to the auditor; payment office; affected contracting officers at the buying activities; and cognizant contracting officers in contract administration activities.
                            </P>
                            <CITA>[73 FR 21848, Apr. 23, 2008, as amended at 76 FR 28867, May 18, 2011; 76 FR 76320, Dec. 7, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>234.203</SECTNO>
                            <SUBJECT>Solicitation provisions and contract clause.</SUBJECT>
                            <P>
                                For cost or incentive contracts valued at $20,000,000 or more, and for other 
                                <PRTPAGE P="338"/>
                                contracts for which EVMS will be applied in accordance with 234.201(1)(iii) and (iv)—
                            </P>
                            <P>(1) Use the provision at 252.234-7001, Notice of Earned Value Management System, instead of the provisions at FAR 52.234-2, Notice of Earned Value Management System—Pre-Award IBR, and FAR 52.234-3, Notice of Earned Value Management System—Post-Award IBR, in the solicitation; and</P>
                            <P>(2) Use the clause at 252.234-7002, Earned Value Management System, instead of the clause at FAR 52.234-4, Earned Value Management System, in the solicitation and contract.</P>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 234.70—Acquisition of Major Weapon Systems as Commercial Products</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>71 FR 58538, Oct. 4, 2006, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>234.7000</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>This subpart—</P>
                            <P>(a) Implements 10 U.S.C. 3455; and</P>
                            <P>(b) Requires a determination by the Secretary of Defense and a notification to Congress before acquiring a major weapon system as a commercial product.</P>
                            <CITA>[71 FR 58538, Oct. 4, 2006, as amended at 87 FR 76995, Dec. 16, 2022; 88 FR 6587, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>234.7001</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <P>As used in this subpart—</P>
                            <P>
                                <E T="03">Major weapon system</E>
                                 means a weapon system acquired pursuant to a major defense acquisition program.
                            </P>
                            <CITA>[85 FR 34532, June 5, 2020]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>234.7002</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Major weapon systems.</E>
                                 (1) A DoD major weapon system may be treated as a commercial product, or acquired under procedures established for the acquisition of commercial products, only if—
                            </P>
                            <P>(i) The Secretary of Defense determines that—</P>
                            <P>(A) The major weapon system is a commercial product as defined in FAR 2.101; and</P>
                            <P>(B) Such treatment is necessary to meet national security objectives; and</P>
                            <P>(ii) The congressional defense committees are notified at least 30 days before such treatment or acquisition occurs. Follow the procedures at PGI 234.7002.</P>
                            <P>(2) The authority of the Secretary of Defense to make a determination under paragraph (a)(1) of this section may not be delegated below the level of the Deputy Secretary of Defense.</P>
                            <P>
                                (b) 
                                <E T="03">Subsystems.</E>
                                 A subsystem of a major weapon system (other than a commercially available off-the-shelf item) shall be treated as a commercial product and acquired under procedures established for the acquisition of commercial products if—
                            </P>
                            <P>(1) The subsystem is intended for a major weapon system that is being acquired, or has been acquired, under procedures established for the acquisition of commercial products in accordance with paragraph (a) of this section; or</P>
                            <P>(2) The contracting officer determines in writing that the subsystem is a commercial product in accordance with 212.102(a)(iii). For a subsystem of a major weapon system proposed as a commercial product that has not previously been determined to be a commercial product (see 212.102(a)(ii)), follow the procedures in paragraph (d) of this section.</P>
                            <P>(3) This paragraph (b) shall apply only to subsystems of major weapon systems that are acquired by DoD through a—</P>
                            <P>(i) Prime contract;</P>
                            <P>(ii) Modification to a prime contract; or</P>
                            <P>(iii) Subcontract under a prime contract for the acquisition of a subsystem proposed as a commercial product that has not previously been determined to be a commercial product (see 212.102(a)(ii)).</P>
                            <P>
                                (c) 
                                <E T="03">Components and spare parts.</E>
                                 (1) A component or spare part for a major weapon system (other than a commercially available off-the-shelf item) may be treated as a commercial product if—
                            </P>
                            <P>(i) The component or spare part is intended for—</P>
                            <P>(A) A major weapon system that is being acquired, or has been acquired, under procedures established for the acquisition of commercial products in accordance with paragraph (a) of this section; or</P>
                            <P>
                                (B) A subsystem of a major weapon system that is being acquired, or has 
                                <PRTPAGE P="339"/>
                                been acquired, under procedures established for the acquisition of commercial products in accordance with paragraph (b) of this section; or
                            </P>
                            <P>(ii) The contracting officer determines in writing that the component or spare part is a commercial product in accordance with 212.102(a)(iii). For a component or spare part proposed as a commercial product that has not previously been determined to be a commercial product (see 212.102(a)(ii)), follow the procedures in paragraph (d) of this section.</P>
                            <P>(2) This paragraph (c) shall apply only to components and spare parts that are acquired by DoD through a—</P>
                            <P>(i) Prime contract;</P>
                            <P>(ii) Modification to a prime contract; or</P>
                            <P>(iii) Subcontract under a prime contract for the acquisition of a component or spare part proposed as a commercial product that has not previously been determined to be a commercial product (see 212.102(a)(ii)).</P>
                            <P>
                                (d) 
                                <E T="03">Commerciality determination.</E>
                                 To the extent necessary to make a commercial product determination in accordance with 212.102(a)(iii) that relies on paragraph (1), (2), (3), (4), or (5) of the “commercial product” definition at FAR 2.101 for a subsystem, component, or spare part as described in paragraphs (b) and (c) of this section, the provision at 252.215-7010, Requirements for Certified Cost or Pricing Data and Data Other Than Certified Cost or Pricing Data, requires the offeror to—
                            </P>
                            <P>(1) Identify the comparable commercial product the offeror sells to the general public or nongovernmental entities for other than governmental purposes;</P>
                            <P>(2) Provide a comparison between the physical characteristics and functionality of the comparable commercial product and the subsystem, component, or spare part, including—</P>
                            <P>(i) For products under paragraph (3)(i) of the “commercial product” definition at FAR 2.101, a description of the modification and documentation to support that the modification is customarily available in the marketplace; or</P>
                            <P>(ii) For products under paragraph (3)(ii) of the “commercial product” definition at FAR 2.101, a detailed description of the modification and detailed technical data to demonstrate that the modification is minor (e.g., information on production processes and material differences); and</P>
                            <P>(3) Provide the national stock number (NSN) for the comparable commercial product, if one is assigned, and the NSN for the subsystem, component, or spare part, if one is assigned; or</P>
                            <P>(4) If the offeror does not sell a comparable commercial product to the general public or nongovernmental entities for other than governmental purposes, then the offeror is required to—</P>
                            <P>(i) Notify the contracting officer in writing that it does not sell such a comparable product; and</P>
                            <P>(ii) Provide the contracting officer a comparison between the physical characteristics and functionality of the most comparable commercial product in the commercial market and the subsystem, component, or spare part, if available.</P>
                            <P>
                                (e) 
                                <E T="03">Relevant information to determine price reasonableness.</E>
                                 For products relying on paragraph (3)(ii) of the “commercial product” definition at FAR 2.101, see FAR 15.403-1(c)(3)(iii)(C). See 212.209(a) for requirements of 10 U.S.C. 3453 with regard to market research.
                            </P>
                            <P>(1) Unless an exception at FAR 15.403-1(b)(1) or (2) applies—</P>
                            <P>(i) To the extent necessary to make a determination of price reasonableness, the contracting officer shall require the offeror to submit to or provide the contracting officer access to a representative sample, as determined by the contracting officer, of prices paid for the same or similar commercial products under comparable terms and conditions by both Government and commercial customers and the terms and conditions of such sales; or</P>
                            <P>
                                (ii) If the contracting officer determines that the offeror cannot provide or give access to sufficient information described in this paragraph (e)(1) to determine the reasonableness of price, the contracting officer shall require the offeror to submit or provide the contracting officer access to a representative sample, as determined by the contracting officer, of the prices paid for the same or similar commercial products sold under different terms 
                                <PRTPAGE P="340"/>
                                and conditions and the terms and conditions of such sales.
                            </P>
                            <P>(2) The contracting officer shall allow the offeror to redact only information provided pursuant to paragraph (e)(1) of this section that identifies the customer, if the offeror certifies in writing for each sale that the customer is a—</P>
                            <P>(i) Government customer (e.g., Federal, State, local, or foreign government);</P>
                            <P>(ii) Commercial customer purchasing the product for governmental purposes; or</P>
                            <P>(iii) Commercial customer purchasing the product for a commercial, mixed, or unknown purpose.</P>
                            <P>(3) If the contracting officer determines that the information submitted pursuant to paragraph (e)(1) of this section is not sufficient to determine the reasonableness of price because the comparable commercial product provided by the offeror is not a valid basis for price analysis or the proposed price is not reasonable after evaluating sales data, then the contracting officer shall obtain approval from an official one level above the contracting officer, without power of delegation, and require the offeror to submit other relevant information regarding the basis for price or cost, including information on labor costs, material costs, and overhead rates.</P>
                            <P>(4) An offeror shall not be required to submit information described in paragraph (e)(1) of this section with regard to a commercially available off-the-shelf item. An offeror may be required to submit such information with regard to any other item that was developed exclusively at private expense only after the head of the contracting activity determines in writing that the information submitted pursuant to paragraph (e)(1) of this section is not sufficient to determine the reasonableness of price.</P>
                            <P>(5) An offeror may submit information or analysis relating to the value of a commercial product to aid in the determination of the reasonableness of the price of such commercial product. A contracting officer may consider such information or analysis in addition to the information submitted pursuant to paragraph (e)(1) of this section. For additional guidance see PGI 234.7002(e)(5).</P>
                            <CITA>[74 FR 34264, July 15, 2009, as amended at 83 FR 4445, Jan. 31, 2018; 85 FR 34532, June 5, 2020; 87 FR 76995, Dec. 16, 2022; 88 FR 6587, Jan. 31, 2023; 89 FR 46808, May 30, 2024]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 234.71—Cost and Software Data Reporting</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>75 FR 71561, Nov. 24, 2010, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>234.7100</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(a) The cost and software data reporting (CSDR) requirement is mandatory for major defense acquisition programs (as defined in 10 U.S.C. 4201) as specified in DoDI 5000.02, Operation of the Adaptive Acquisition Framework and the DoD 5000.04-M-1, CSDR Manual. The CSDR system is applied in accordance with the reporting requirements established in DoDI 5000.02. The two principal components of the CSDR system are contractor cost data reporting and software resources data reporting.</P>
                            <P>(b) Prior to contract award, contracting officers shall consult with the Defense Cost and Resource Center to determine that the offeror selected for award has proposed a standard CSDR system, as described in the offeror's proposal in response to the provision at 252.234-7003, that is in compliance with DoDI 5000.02, Operation of the Adaptive Acquisition Framework, and the DoD 5000.04-M-1, CSDR Manual.</P>
                            <P>(c) Contact information for the Defense Cost and Resource Center and the Deputy Director, Cost Assessment, is located at PGI 234.7100.</P>
                            <CITA>[75 FR 71561, Nov. 24, 2010, as amended at 87 FR 76995, Dec. 16, 2022; 88 FR 46904, July 20, 2023; 88 FR 80466, Nov. 17, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>234.7101</SECTNO>
                            <SUBJECT>Solicitation provision and contract clause.</SUBJECT>
                            <P>(a) Use the basic or the alternate of the provision at 252.234-7003, Notice of Cost and Software Data Reporting System, in any solicitation that includes the basic or the alternate of the clause at 252.234-7004, Cost and Software Data Reporting.</P>
                            <P>
                                (1) Use the basic provision when the solicitation includes the clause at 
                                <PRTPAGE P="341"/>
                                252.234-7004, Cost and Software Data Reporting—Basic.
                            </P>
                            <P>(2) Use the alternate I provision when the solicitation includes the clause at 252.234-7004, Cost and Software Data Reporting—Alternate I.</P>
                            <P>(b) Use the basic or the alternate of the clause at 252.234-7004, Cost and Software Data Reporting System, in solicitations that include major defense acquisition programs as follows:</P>
                            <P>(1) Use the basic clause in solicitations and contracts for major defense acquisition programs that exceed $50 million.</P>
                            <P>(2) Use the alternate I clause in solicitations and contracts for major defense acquisition programs with a value equal to or greater than $20 million, but less than or equal to $50 million, when so directed by the program manager with the approval of the OSD Deputy Director, Cost Assessment.</P>
                            <CITA>[79 FR 65593, Nov. 5, 2014, as amended at 88 FR 46904, July 20, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 235</EAR>
                    <HD SOURCE="HED">PART 235—RESEARCH AND DEVELOPMENT CONTRACTING</HD>
                    <CONTENTS>
                        <SECHD>Sec.</SECHD>
                        <SECTNO>235.001</SECTNO>
                        <SUBJECT>Definitions.</SUBJECT>
                        <SECTNO>235.006</SECTNO>
                        <SUBJECT>Contracting methods and contract type.</SUBJECT>
                        <SECTNO>235.006-70</SECTNO>
                        <SUBJECT>Manufacturing Technology Program.</SUBJECT>
                        <SECTNO>235.006-71</SECTNO>
                        <SUBJECT>Competition.</SUBJECT>
                        <SECTNO>235.008</SECTNO>
                        <SUBJECT>Evaluation for award.</SUBJECT>
                        <SECTNO>235.010</SECTNO>
                        <SUBJECT>Scientific and technical reports.</SUBJECT>
                        <SECTNO>235.015-70</SECTNO>
                        <SUBJECT>Special use allowances for research facilities acquired by educational institutions.</SUBJECT>
                        <SECTNO>235.016</SECTNO>
                        <SUBJECT>Broad agency announcement.</SUBJECT>
                        <SECTNO>235.017</SECTNO>
                        <SUBJECT>Federally Funded Research and Development Centers.</SUBJECT>
                        <SECTNO>235.017-1</SECTNO>
                        <SUBJECT>Sponsoring agreements.</SUBJECT>
                        <SECTNO>235.070</SECTNO>
                        <SUBJECT>Indemnification against unusually hazardous risks.</SUBJECT>
                        <SECTNO>235.070-1</SECTNO>
                        <SUBJECT>Indemnification under research and development contracts.</SUBJECT>
                        <SECTNO>235.070-2</SECTNO>
                        <SUBJECT>Indemnification under contracts involving both research and development and other work.</SUBJECT>
                        <SECTNO>235.070-3</SECTNO>
                        <SUBJECT>Contract clauses.</SUBJECT>
                        <SECTNO>235.071</SECTNO>
                        <SUBJECT>Export-controlled items.</SUBJECT>
                        <SECTNO>235.072</SECTNO>
                        <SUBJECT>Additional contract clauses.</SUBJECT>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36416, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SECTION>
                        <SECTNO>235.001</SECTNO>
                        <SUBJECT>Definitions.</SUBJECT>
                        <P>“Research and development” means those efforts described by the Research, Development, Test, and Evaluation (RDT&amp;E) budget activity definitions found in the DoD Financial Management Regulation (DoD 7000.14-R), Volume 2B, Chapter 5.</P>
                        <CITA>[65 FR 32040, May 22, 2000]</CITA>
                    </SECTION>
                    <SECTION>
                        <SECTNO>235.006</SECTNO>
                        <SUBJECT>Contracting methods and contract type.</SUBJECT>
                        <P>(b)(i) For major defense acquisition programs as defined in 10 U.S.C. 4201—</P>
                        <P>(A) Follow the procedures at 234.004; and</P>
                        <P>(B) Notify the milestone decision authority of an intent not to exercise a fixed-price production option on a development contract for a major weapon system reasonably in advance of the expiration of the option exercise period.</P>
                        <P>(ii) For other than major defense acquisition programs—</P>
                        <P>(A) Do not award a fixed-price type contract for a development program effort unless—</P>
                        <P>
                            (
                            <E T="03">1</E>
                            ) The level of program risk permits realistic pricing;
                        </P>
                        <P>
                            (
                            <E T="03">2</E>
                            ) The use of a fixed-price type contract permits an equitable and sensible allocation of program risk between the Government and the contractor; and
                        </P>
                        <P>
                            (
                            <E T="03">3</E>
                            ) A written determination that the criteria of paragraphs (b)(ii)(A)(
                            <E T="03">1</E>
                            ) and (
                            <E T="03">2</E>
                            ) of this section have been met is executed—
                        </P>
                        <P>
                            (
                            <E T="03">i</E>
                            ) By the USD(A&amp;S) if the contract is over $25 million and is for: research and development for a non-major system; the development of a major system (as defined in FAR 2.101); or the development of a subsystem of a major system; or
                        </P>
                        <P>
                            (
                            <E T="03">ii</E>
                            ) By the contracting officer for any development not covered by paragraph (b)(ii)(A)(
                            <E T="03">3</E>
                            )(
                            <E T="03">i</E>
                            ) of this section.
                        </P>
                        <P>(B) Obtain USD(A&amp;S) approval of the Government's prenegotiation position before negotiations begin, and obtain USD(A&amp;S) approval of the negotiated agreement with the contractor before the agreement is executed, for any action that is—</P>
                        <P>
                            (
                            <E T="03">1</E>
                            ) An increase of more than $250 million in the price or ceiling price of a fixed-price type development contract, 
                            <PRTPAGE P="342"/>
                            or a fixed-price type contract for the lead ship of a class;
                        </P>
                        <P>
                            (
                            <E T="03">2</E>
                            ) A reduction in the amount of work under a fixed-price type development contract or a fixed-price type contract for the lead ship of a class, when the value of the work deleted is $100 million or more; or
                        </P>
                        <P>
                            (
                            <E T="03">3</E>
                            )) A repricing of fixed-price type production options to a development contract, or a contract for the lead ship of a class, that increases the price or ceiling price by more than $250 million for equivalent quantities.
                        </P>
                        <CITA>[73 FR 4118, Jan. 24, 2008, as amended at 84 FR 65308, Nov. 27, 2019; 87 FR 65513, Oct. 28, 2022; 87 FR 76995, Dec. 16, 2022]</CITA>
                    </SECTION>
                    <SECTION>
                        <SECTNO>235.006-70</SECTNO>
                        <SUBJECT>Manufacturing Technology Program.</SUBJECT>
                        <P>In accordance with 10 U.S.C. 4841(d) and 4872, for acquisitions under the Manufacturing Technology Program—</P>
                        <P>(a) Award all contracts using competitive procedures; and</P>
                        <P>(b) Include in all solicitations an evaluation factor that addresses the extent to which offerors propose to share in the cost of the project (see FAR 15.304).</P>
                        <CITA>[65 FR 2058, Jan. 13, 2000, as amended at 69 FR 65092, Nov. 10, 2004; 87 FR 76995, Dec. 16, 2022]</CITA>
                    </SECTION>
                    <SECTION>
                        <SECTNO>235.006-71</SECTNO>
                        <SUBJECT>Competition.</SUBJECT>
                        <P>(a)(1) Use of a broad agency announcement with peer or scientific review for the award of science and technology proposals in accordance with 235.016(a) fulfills the requirement for full and open competition (see 206.102(d)(2)).</P>
                        <P>(2) Use of a commercial solutions opening with scientific, technological, or other subject-matter expert peer review for the award of innovative solutions or potential capabilities in accordance with subpart 212.70 fulfills the requirement for full and open competition (see 206.102-70).</P>
                        <P>(b) For a contract that is initially awarded from the competitive selection of a proposal resulting from a broad agency announcement, see 234.005-1 for the use of contract line items or contract options for the development and demonstration or initial production of technology developed under the contract or the delivery of initial or additional items.</P>
                        <CITA>[75 FR 71563, Nov. 24, 2010, as amended at 84 FR 4366, Feb. 15, 2019; 87 FR 25145, Apr. 28, 2022; 88 FR 55940, Aug. 17, 2023]</CITA>
                    </SECTION>
                    <SECTION>
                        <SECTNO>235.008</SECTNO>
                        <SUBJECT>Evaluation for award.</SUBJECT>
                        <P>See 209.570 for limitations on the award of contracts to contractors acting as lead system integrators.</P>
                        <CITA>[73 FR 1825, Jan. 10, 2008]</CITA>
                    </SECTION>
                    <SECTION>
                        <SECTNO>235.010</SECTNO>
                        <SUBJECT>Scientific and technical reports.</SUBJECT>
                        <P>(b) For DoD, the Defense Technical Information Center is responsible for collecting all scientific and technical reports. For access to these reports, follow the procedures at PGI 235.010(b).</P>
                        <CITA>[69 FR 65092, Nov. 10, 2004]</CITA>
                    </SECTION>
                    <SECTION>
                        <SECTNO>235.015-70</SECTNO>
                        <SUBJECT>Special use allowances for research facilities acquired by educational institutions.</SUBJECT>
                        <P>
                            (a) 
                            <E T="03">Definitions.</E>
                             As used in this subsection—
                        </P>
                        <P>
                            (1) 
                            <E T="03">Research facility</E>
                             means—
                        </P>
                        <P>(i) Real property, other than land; and</P>
                        <P>(ii) Includes structures, alterations, and improvements, acquired for the purpose of conducting scientific research under contracts with departments and agencies of the DoD.</P>
                        <P>
                            (2) 
                            <E T="03">Special use allowance</E>
                             means a negotiated direct or indirect allowance—
                        </P>
                        <P>(i) For construction or acquisition of buildings, structures, and real property, other than land; and</P>
                        <P>(ii) Where the allowance is computed at an annual rate exceeding the rate which normally would be allowed under FAR subpart 31.3.</P>
                        <P>
                            (b) 
                            <E T="03">Policy.</E>
                             (1) Educational institutions are to furnish the facilities necessary to perform Defense contracts. FAR 31.3 governs how much the Government will reimburse the institution for the research programs. However, in extraordinary situations, the Government may give special use allowances to an educational institution when the institution is unable to provide the capital for new laboratories or expanded facilities needed for Defense contracts.
                        </P>
                        <P>
                            (2) Decisions to provide a special use allowance must be made on a case-by-
                            <PRTPAGE P="343"/>
                            case basis, using the criteria in paragraph (c) of this subsection.
                        </P>
                        <P>
                            (c) 
                            <E T="03">Authorization for special use allowance.</E>
                             The head of a contracting activity may approve special use allowances only when all of the following conditions are met—
                        </P>
                        <P>(1) The research facility is essential to the performance of DoD contracts;</P>
                        <P>(2) Existing facilities, either Government or nongovernment, cannot meet program requirements practically or effectively;</P>
                        <P>(3) The proposed agreement for special use allowances is a sound business arrangement;</P>
                        <P>(4) The Government's furnishing of Government-owned facilities is undesirable or impractical; and</P>
                        <P>(5) The proposed use of the research facility is to conduct essential Government research which requires the new or expanded facilities.</P>
                        <P>
                            (d) 
                            <E T="03">Application of the special use allowance.</E>
                             (1) In negotiating a special use allowance—
                        </P>
                        <P>(i) Compare the needs of DoD and of the institution for the research facility to determine the amount of the special use allowance;</P>
                        <P>(ii) Consider rental costs for similar space in the area where the research facility is or will be located to establish the annual special use allowance;</P>
                        <P>(iii) Do not include or allow—</P>
                        <P>(A) The costs of land; or</P>
                        <P>(B) Interest charges on capital;</P>
                        <P>(iv) Do not include maintenance, utilities, or other operational costs;</P>
                        <P>(v) The period of allowance generally will be—</P>
                        <P>(A) At least ten years; or</P>
                        <P>(B) A shorter period if the total amount to be allowed is less than the construction or acquisition cost for the research facility;</P>
                        <P>(vi) Generally, provide for allocation of the special use allowance equitably among the Government contracts using the research facility;</P>
                        <P>(vii) Special use allowances apply only in the years in which the Government has contracts in effect with the institution. However, if in any given year there is a reduced level of Government research effort which results in the special use allowance being excessive compared to the Government research funding, a separate special use allowance may be negotiated for that year;</P>
                        <P>(viii) Special use allowances may be adjusted for the period before construction is complete if the facility is partially occupied and used for Government research during that period.</P>
                        <P>(2) A special use allowance may be based on either total or partial cost of construction or acquisition of the research facility.</P>
                        <P>(i) When based on total cost neither the normal use allowance nor depreciation will apply—</P>
                        <P>(A) During the special use allowance period; and</P>
                        <P>(B) After the educational institution has recovered the total construction or acquisition cost from the Government or other users.</P>
                        <P>(ii) When based on partial cost, normal use allowance and depreciation—</P>
                        <P>(A) Apply to the balance of costs during the special use allowance period to the extent negotiated in the special use allowance agreement; and</P>
                        <P>(B) Do not apply after the special use allowance period, except for normal use allowance applied to the balance.</P>
                        <P>(3) During the special use allowance period, the research facility—</P>
                        <P>(i) Shall be available for Government research use on a priority basis over nongovernment use; and</P>
                        <P>(ii) Cannot be put to any significant use other than that which justified the special use allowance, unless the head of the contracting activity, who approved the special use allowance, consents.</P>
                        <P>(4) The Government will pay only an allocable share of the special use allowance when the institution makes any substantial use of the research facility for parties other than the Government during the period when the special use allowance is in effect.</P>
                        <P>(5) In no event shall the institution be paid more than the acquisition costs.</P>
                        <CITA>[56 FR 36416, July 31, 1991, as amended at 60 FR 29500, June 5, 1995]</CITA>
                    </SECTION>
                    <SECTION>
                        <SECTNO>235.016</SECTNO>
                        <SUBJECT>Broad agency announcement.</SUBJECT>
                        <P>
                            (a) 
                            <E T="03">General.</E>
                             A broad agency announcement with peer or scientific review may be used for the award of science and technology proposals. 
                            <PRTPAGE P="344"/>
                            Science and technology proposals include proposals for the following:
                        </P>
                        <P>(i) Basic research (budget activity 6.1).</P>
                        <P>(ii) Applied research (budget activity 6.2).</P>
                        <P>(iii) Advanced technology development (budget activity 6.3).</P>
                        <P>(iv) Advanced component development and prototypes (budget activity 6.4).</P>
                        <CITA>[84 FR 4366, Feb. 15, 2019]</CITA>
                    </SECTION>
                    <SECTION>
                        <SECTNO>235.017</SECTNO>
                        <SUBJECT>Federally Funded Research and Development Centers.</SUBJECT>
                        <P>
                            (a) 
                            <E T="03">Policy.</E>
                             (2) No DoD fiscal year 1992 or later funds may be obligated or expended to finance activities of a DoD Federally Funded Research and Development Center (FFRDC) if a member of its board of directors or trustees simultaneously serves on the board of directors or trustees of a profit-making company under contract to DoD, unless the FFRDC has a DoD-approved conflict of interest policy for its members (section 8107 of Pub. L. 102-172 and similar sections in subsequent Defense appropriations acts).
                        </P>
                        <CITA>[58 FR 28471, May 13, 1993]</CITA>
                    </SECTION>
                    <SECTION>
                        <SECTNO>235.017-1</SECTNO>
                        <SUBJECT>Sponsoring agreements.</SUBJECT>
                        <P>(c)(4) DoD-sponsoring FFRDCs that function primarily as research laboratories (C3I Laboratory operated by the Institute for Defense Analysis, Lincoln Laboratory operated by Massachusetts Institute of Technology, and Software Engineering Institute operated by Carnegie Mellon) may respond to solicitations and announcements for programs which promote research, development, demonstration, or transfer of technology (Section 217, Public Law 103-337).</P>
                        <CITA>[60 FR 61598, Nov. 30, 1995, as amended at 69 FR 65092, Nov. 10, 2004]</CITA>
                    </SECTION>
                    <SECTION>
                        <SECTNO>235.070</SECTNO>
                        <SUBJECT>Indemnification against unusually hazardous risks.</SUBJECT>
                    </SECTION>
                    <SECTION>
                        <SECTNO>235.070-1</SECTNO>
                        <SUBJECT>Indemnification under research and development contracts.</SUBJECT>
                        <P>(a) Under 10 U.S.C. 3861, and if authorized by the Secretary concerned, contracts for research and/or development may provide for indemnification of the contractor or subcontractors for—</P>
                        <P>(1) Claims by third persons (including employees) for death, bodily injury, or loss of or damage to property; and</P>
                        <P>(2) Loss of or damage to the contractor's property to the extent that the liability, loss, or damage—</P>
                        <P>(i) Results from a risk that the contract defines as “unusually hazardous;”</P>
                        <P>(ii) Arises from the direct performance of the contract; and</P>
                        <P>(iii) Is not compensated by insurance or other means.</P>
                        <P>(b) Clearly define the specific unusually hazardous risks to be indemnified. Submit this definition for approval with the request for authorization to grant indemnification. Include the approved definition in the contract.</P>
                        <CITA>[56 FR 36416, July 31, 1991, as amended at 64 FR 51076, Sept. 21, 1999; 87 FR 76995, Dec. 16, 2022]</CITA>
                    </SECTION>
                    <SECTION>
                        <SECTNO>235.070-2</SECTNO>
                        <SUBJECT>Indemnification under contracts involving both research and development and other work.</SUBJECT>
                        <P>These contracts may provide for indemnification under the authority of both 10 U.S.C. 3861 and Public Law 85-804. Public Law 85-804 will apply only to work to which 10 U.S.C. 3861 does not apply. Actions under Public Law 85-804 must also comply with FAR 50.104-3.</P>
                        <CITA>[56 FR 36416, July 31, 1991, as amended at 78 FR 21850, Apr. 12, 2013; 87 FR 76995, Dec. 16, 2022]</CITA>
                    </SECTION>
                    <SECTION>
                        <SECTNO>235.070-3</SECTNO>
                        <SUBJECT>Contract clauses.</SUBJECT>
                        <P>When the contractor is to be indemnified in accordance with 235.070-1, use either—</P>
                        <P>(a) The clause at 252.235-7000, Indemnification Under 10 U.S.C. 3861—Fixed Price; or</P>
                        <P>(b) The clause at 252.235-7001, Indemnification Under 10 U.S.C. 3861—Cost-Reimbursement, as appropriate.</P>
                        <CITA>[56 FR 36284, July 31, 1991, as amended at 87 FR 76995, Dec. 16, 2022]</CITA>
                    </SECTION>
                    <SECTION>
                        <SECTNO>235.071</SECTNO>
                        <SUBJECT>Export-controlled items.</SUBJECT>
                        <P>For requirements regarding access to export-controlled items, see 225.7901.</P>
                        <CITA>[73 FR 42278, July 21, 2008, as amended at 78 FR 36111, June 17, 2013]</CITA>
                    </SECTION>
                    <SECTION>
                        <PRTPAGE P="345"/>
                        <SECTNO>235.072</SECTNO>
                        <SUBJECT>Additional contract clauses.</SUBJECT>
                        <P>(a) Use a clause substantially the same as the clause at 252.235-7002, Animal Welfare, in solicitations and contracts involving research, development, test, and evaluation or training that use live vertebrate animals.</P>
                        <P>(b) Use the basic or the alternate of the clause at 252.235-7003, Frequency Authorization, in solicitations and contracts for developing, producing, constructing, testing, or operating a device requiring a frequency authorization.</P>
                        <P>(1) Use the basic clause if agency procedures do not authorize the use of DD Form 1494, Application for Equipment Frequency Allocation, to obtain radio frequency authorization.</P>
                        <P>(2) Use the alternate I clause if agency procedures authorize the use of DD Form 1494, Application for Equipment Frequency Allocation, to obtain frequency authorization.</P>
                        <P>(c) Use the clause at 252.235-7010, Acknowledgement of Support and Disclaimer, in solicitations and contracts for research and development.</P>
                        <P>(d) Use the clause at 252.235-7011, Final Scientific or Technical Report, in solicitations and contracts for research and development.</P>
                        <P>(e) Use the clause at 252.235-7004, Protection of Human Subjects, in solicitations and contracts that include or may include research involving human subjects in accordance with 32 CFR Part 219, DoD Directive 3216.02, and 10 U.S.C. 980, including research that meets exemption criteria under 32 CFR 219.101(b). The clause—</P>
                        <P>(1) Applies to solicitations and contracts awarded by any DoD component, regardless of mission or funding Program Element Code; and</P>
                        <P>(2) Does not apply to use of cadaver materials alone, which are not directly regulated by 32 CFR Part 219 or DoD Directive 3216.02, and which are governed by other DoD policies and applicable State and local laws.</P>
                        <CITA>[56 FR 36416, July 31, 1991, as amended at 60 FR 29500, June 5, 1995; 70 FR 35545, June 21, 2005. Redesignated at 73 FR 42278, July 21, 2008; 74 FR 37645, 37648, July 29, 2009; 79 FR 17447, Mar. 28, 2014; 79 FR 23501, Dec. 11, 2014]</CITA>
                    </SECTION>
                </PART>
                <PART>
                    <EAR>Pt. 236</EAR>
                    <HD SOURCE="HED">PART 236—CONSTRUCTION AND ARCHITECT-ENGINEER CONTRACTS</HD>
                    <CONTENTS>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 236.1—General</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>236.102</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 236.2—Special Aspects of Contracting for Construction</HD>
                            <SECTNO>236.203</SECTNO>
                            <SUBJECT>Government estimate of construction costs.</SUBJECT>
                            <SECTNO>236.204</SECTNO>
                            <SUBJECT>Disclosure of the magnitude of construction projects.</SUBJECT>
                            <SECTNO>236.206</SECTNO>
                            <SUBJECT>Liquidated damages.</SUBJECT>
                            <SECTNO>236.211</SECTNO>
                            <SUBJECT>Distribution of advance notices and solicitations.</SUBJECT>
                            <SECTNO>236.213</SECTNO>
                            <SUBJECT>Special procedures for sealed bidding in construction contracting.</SUBJECT>
                            <SECTNO>236.215</SECTNO>
                            <SUBJECT>Special procedures for cost-reimbursement contracts for construction.</SUBJECT>
                            <SECTNO>236.270</SECTNO>
                            <SUBJECT>Expediting construction contracts.</SUBJECT>
                            <SECTNO>236.271</SECTNO>
                            <SUBJECT>Cost-plus-fixed-fee contracts.</SUBJECT>
                            <SECTNO>236.272</SECTNO>
                            <SUBJECT>Prequalification of sources.</SUBJECT>
                            <SECTNO>236.273</SECTNO>
                            <SUBJECT>Construction in foreign countries.</SUBJECT>
                            <SECTNO>236.274</SECTNO>
                            <SUBJECT>Restriction on acquisition of steel for use in military construction projects.</SUBJECT>
                            <SECTNO>236.275</SECTNO>
                            <SUBJECT>Construction of industrial resources.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">SUBPART 236.3—Two-phase design-build selection procedures</HD>
                            <SECTNO>236.303-1</SECTNO>
                            <SUBJECT>Phase One.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 236.5—Contract Clauses</HD>
                            <SECTNO>236.570</SECTNO>
                            <SUBJECT>Additional provisions and clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 236.6—Architect-Engineer Services</HD>
                            <SECTNO>236.601</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>236.602</SECTNO>
                            <SUBJECT>Selection of firms for architect-engineer contracts.</SUBJECT>
                            <SECTNO>236.602-1</SECTNO>
                            <SUBJECT>Selection criteria.</SUBJECT>
                            <SECTNO>236.602-70</SECTNO>
                            <SUBJECT>Restriction on award of overseas architect-engineer contracts to foreign firms.</SUBJECT>
                            <SECTNO>236.604</SECTNO>
                            <SUBJECT>Performance evaluation.</SUBJECT>
                            <SECTNO>236.606</SECTNO>
                            <SUBJECT>Negotiations.</SUBJECT>
                            <SECTNO>236.606-70</SECTNO>
                            <SUBJECT>Statutory fee limitation.</SUBJECT>
                            <SECTNO>236.609</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <SECTNO>236.609-70</SECTNO>
                            <SUBJECT>Additional provision.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 236.7—Standard and Optional Forms for Contracting for Construction, Architect-Engineer Services, and Dismantling, Demolition, or Removal of Improvements</HD>
                            <SECTNO>236.701</SECTNO>
                            <SUBJECT>Standard and optional forms for use in contracting for construction or dismantling, demolition, or removal of improvements.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <PRTPAGE P="346"/>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36421, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 236.1—General</HD>
                        <SECTION>
                            <SECTNO>236.102</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>
                                <E T="03">Construction activity</E>
                                 means an activity at any organizational level of the DoD that—
                            </P>
                            <P>(1) Is responsible for the architectural, engineering, and other related technical aspects of the planning, design, and construction of facilities; and</P>
                            <P>(2) Receives its technical guidance from the Army Office of the Chief of Engineers, Naval Facilities Engineering Command, or Air Force Directorate of Civil Engineering.</P>
                            <P>
                                <E T="03">Marshallese firm</E>
                                 is defined in the provision at 252.236-7012, Military Construction on Kwajalein Atoll—Evaluation Preference.
                            </P>
                            <P>
                                <E T="03">United States firm</E>
                                 is defined in the provisions at 252.236-7010, Overseas Military Construction-Preference for United States Firms, and 252.236-7011, Overseas Architect-Engineer Services-Restriction to United States firms.
                            </P>
                            <CITA>[56 FR 36421, July 31, 1991, as amended at 62 FR 2857, Jan. 17, 1997; 63 FR 11538, Mar. 9, 1998; 71 FR 9272, Feb. 23, 2006; 76 FR 58155, Sept. 20, 2011]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 236.2—Special Aspects of Contracting for Construction</HD>
                        <SECTION>
                            <SECTNO>236.203</SECTNO>
                            <SUBJECT>Government estimate of construction costs.</SUBJECT>
                            <P>Follow the procedures at PGI 236.203 for handling the Government estimate of construction costs.</P>
                            <CITA>[71 FR 9273, Feb. 23, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>236.204</SECTNO>
                            <SUBJECT>Disclosure of the magnitude of construction projects.</SUBJECT>
                            <P>Additional price ranges are—</P>
                            <P>(i) Between $10,000,000 and $25,000,000;</P>
                            <P>(ii) Between $25,000,000 and $100,000,000;</P>
                            <P>(iii) Between $100,000,000 and $250,000,000;</P>
                            <P>(iv) Between $250,000,000 and $500,000,000; and</P>
                            <P>(v) Over $500,000,000.</P>
                            <CITA>[61 FR 7749, Feb. 29, 1996]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>236.206</SECTNO>
                            <SUBJECT>Liquidated damages.</SUBJECT>
                            <P>See 211.503 for instructions on use of liquidated damages.</P>
                            <CITA>[56 FR 36421, July 31, 1991, as amended at 66 FR 49861, Oct. 1, 2001]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>236.211</SECTNO>
                            <SUBJECT>Distribution of advance notices and solicitations.</SUBJECT>
                            <P>See PGI 236.211 for instructions on reporting data for definitization of requests for equitable adjustment.</P>
                            <CITA>[88 FR 73237, Oct. 25, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>236.213</SECTNO>
                            <SUBJECT>Special procedures for sealed bidding in construction contracting.</SUBJECT>
                            <P>If it appears that sufficient funds may not be available for all the desired construction features, consider using a bid schedule with additive or deductive items in accordance with PGI 236.213.</P>
                            <CITA>[71 FR 9273, Feb. 23, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>236.215</SECTNO>
                            <SUBJECT>Special procedures for cost-reimbursement contracts for construction.</SUBJECT>
                            <P>For contracts in connection with a military construction project or military family housing project, see the prohibition at 216.301-3.</P>
                            <CITA>[81 FR 65564, Sept. 23, 2016]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>236.270</SECTNO>
                            <SUBJECT>Expediting construction contracts.</SUBJECT>
                            <P>(a) 10 U.S.C. 2858 requires agency head approval to expedite the completion date of a contract funded by a Military Construction Appropriations Act, if additional costs are involved. This approval authority may not be redelegated. The approval authority must—</P>
                            <P>(1) Certify that the additional expenditures are necessary to protect the National interest; and</P>
                            <P>(2) Establish a reasonable completion date for the project.</P>
                            <P>(b) The contracting officer may approve an expedited completion date if no additional costs are involved.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>236.271</SECTNO>
                            <SUBJECT>Cost-plus-fixed-fee contracts.</SUBJECT>
                            <P>
                                Annual military construction appropriations acts restrict the use of cost-plus-fixed-fee contracts (see 216.306(c)). 
                                <PRTPAGE P="347"/>
                                See also 216.301-3 regarding the prohibition on the use of certain cost-reimbursement contracts in connection with a military construction project or military family housing project.
                            </P>
                            <CITA>[81 FR 65565, Sept. 23, 2016]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>236.272</SECTNO>
                            <SUBJECT>Prequalification of sources.</SUBJECT>
                            <P>(a) Prequalification procedures may be used when necessary to ensure timely and efficient performance of critical construction projects. Prequalification—</P>
                            <P>(1) Results in a list of sources determined to be qualified to perform a specific construction contract; and</P>
                            <P>(2) Limits offerors to those with proven competence to perform in the required manner.</P>
                            <P>(b) The head of the contracting activity must—</P>
                            <P>(1) Authorize the use of prequalification by determining, in writing, that a construction project is of an urgency or complexity that requires prequalification; and</P>
                            <P>(2) Approve the prequalification procedures.</P>
                            <P>(c) For small businesses, the prequalification procedures must require the qualifying authority to—</P>
                            <P>(1) Request a preliminary recommendation from the appropriate Small Business Administration regional office, if the qualifying authority believes a small business is not responsible;</P>
                            <P>(2) Permit the small business to submit a bid or proposal if the preliminary recommendation is that the small business is responsible; and</P>
                            <P>(3) Follow the procedures in FAR 19.6, if the small business is in line for award and is found nonresponsible.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>236.273</SECTNO>
                            <SUBJECT>Construction in foreign countries.</SUBJECT>
                            <P>
                                (a) In accordance with section 112 of the Military Construction and Veterans Affairs and Related Agencies Appropriations Act, 2015 (Division I of Pub. L. 113-235) and the same provision in subsequent military construction appropriations acts, military construction contracts funded with military construction appropriations, that are estimated to exceed $1,000,000 and are to be performed in the United States outlying areas in the Pacific and on Kwajalein Atoll, or in countries bordering the Arabian Gulf (
                                <E T="03">i.e.,</E>
                                 Iran, Oman, United Arab Emirates, Saudi Arabia, Qatar, Bahrain, Kuwait, and Iraq), shall be awarded only to United States firms, unless—
                            </P>
                            <P>(1) The lowest responsive and responsible offer of a United States firm exceeds the lowest responsive and responsible offer of a foreign firm by more than 20 percent; or</P>
                            <P>(2) The contract is for military construction on Kwajalein Atoll and the lowest responsive and responsible offer is submitted by a Marshallese firm.</P>
                            <P>(b) See PGI 236.273(b) for guidance on technical working agreements with foreign governments.</P>
                            <CITA>[56 FR 36421, July 31, 1991, as amended at 62 FR 2856, Jan. 17, 1997; 62 FR 34127, June 24, 1997; 63 FR 11538, Mar. 9, 1998; 66 FR 49861, Oct. 1, 2001; 70 FR 35545, June 21, 2005. Redesignated and amended at 71 FR 9273, Feb. 23, 2006; 79 FR 44316, July 31, 2014; 80 FR 15911, Mar. 26, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>236.274</SECTNO>
                            <SUBJECT>Restriction on acquisition of steel for use in military construction projects.</SUBJECT>
                            <P>In accordance with section 108 of the Military Construction and Veterans Affairs Appropriations Act, 2009 ( Pub. L. 110-329, Division E) and the same provision in subsequent military construction appropriations acts), do not acquire, or allow a contractor to acquire, steel for any construction project or activity for which American steel producers, fabricators, or manufacturers have been denied the opportunity to compete for such acquisition of steel.</P>
                            <CITA>[74 FR 2418, Jan. 15, 2009, as amended at 80 FR 15911, Mar. 26, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>236.275</SECTNO>
                            <SUBJECT>Construction of industrial resources.</SUBJECT>
                            <P>See Subpart 237.75 for policy relating to facilities projects.</P>
                            <CITA>[74 FR 37646, July 29, 2009]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 236.3—Two-phase design-Build selection procedures</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>84 FR 4373, Feb. 15, 2019, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <PRTPAGE P="348"/>
                            <SECTNO>236.303-1</SECTNO>
                            <SUBJECT>Phase One.</SUBJECT>
                            <P>(a)(4) In lieu of the limitations on the maximum number of offerors that may be selected to submit phase-two proposals at FAR 36.303-1(a)(4), for DoD—</P>
                            <P>(i) If the contract value exceeds $4.5 million, the maximum number of offerors specified in the solicitation that are to be selected to submit phase-two proposals shall not exceed five, unless—</P>
                            <P>(A) The solicitation is issued for an indefinite-delivery indefinite-quantity contract for design-build construction; or</P>
                            <P>(B) The head of the contracting activity, delegable to a level no lower than the senior contracting official within the contracting activity, approves the contracting officer's decision with respect to an individual solicitation, that a maximum number greater than five is in the best interest of the Government and is consistent with the purposes and objectives of the two-phase selection procedures. The decision shall be documented in the contract file (10 U.S.C. 3241(d)).</P>
                            <P>(ii) If the contract value is at or below $4.5 million, the maximum number of offerors specified in the solicitation that are to be selected to submit phase-two proposals is at the discretion of the contracting officer.</P>
                            <CITA>[84 FR 4373, Feb. 15, 2019, as amended at 85 FR 61504, Sept. 29, 2020; 87 FR 76995, Dec. 16, 2022]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 236.5—Contract Clauses</HD>
                        <SECTION>
                            <SECTNO>236.570</SECTNO>
                            <SUBJECT>Additional provisions and clauses.</SUBJECT>
                            <P>(a) Use the following clauses in all fixed-price construction solicitations and contracts—</P>
                            <P>(1) 252.236-7000, Modification Proposals-Price Breakdown; and</P>
                            <P>(2) 252.236-7001, Contract Drawings and Specifications.</P>
                            <P>(b) Use the following provisions and clauses in fixed-price construction contracts and solicitations as applicable—</P>
                            <P>(1) 252.236-7002, Obstruction of Navigable Waterways, when the contract will involve work near or on navigable waterways.</P>
                            <P>(2) When the head of the contracting activity has approved use of a separate bid item for mobilization and preparatory work, use either—</P>
                            <P>(i) 252.236-7003, Payment for Mobilization and Preparatory Work. Use this clause for major construction contracts that require—</P>
                            <P>(A) Major or special items of plant and equipment; or</P>
                            <P>(B) Large stockpiles of material which are in excess of the type, kind, and quantity which would be normal for a contractor qualified to undertake the work; or</P>
                            <P>(ii) 252.236-7004, Payment for Mobilization and Demobilization. Use this clause for contracts involving major mobilization expense, or plant equipment and material (other than the situations covered in paragraph (b)(2)(i) of this section) made necessary by the location or nature of the work.</P>
                            <P>(A) Generally, allocate 60 percent of the lump sum price in paragraph (a) of the clause to the cost of mobilization.</P>
                            <P>(B) Vary this percentage to reflect the circumstances of the particular contract, but in no event should mobilization exceed 80 percent of the payment item.</P>
                            <P>(3) 252.236-7005, Airfield Safety Precautions, when construction will be performed on or near airfields.</P>
                            <P>(4) 252.236-7006, Cost Limitation, if the solicitation's bid schedule contains one or more items subject to statutory cost limitations, and if a waiver has not been granted (FAR 36.205).</P>
                            <P>(5) 252.236-7007, Additive or Deductive Items, if the procedures in 236.213 are being used.</P>
                            <P>(6) 252.236-7008, Contract Prices—Bidding Schedule, if the contract will contain only unit prices for some items.</P>
                            <P>(c) Use the following provisions in solicitations for military construction contracts that are funded with military construction appropriations and are estimated to exceed $1,000,000:</P>
                            <P>(1) 252.236-7010, Overseas Military Construction—Preference for United States Firms, when contract performance will be in a United States outlying area in the Pacific or in a country bordering the Arabian Gulf.</P>
                            <P>
                                (2) 252.236-7012, Military Construction on Kwajalein Atoll—Evaluation Preference, when contract performance will be on Kwajalein Atoll.
                                <PRTPAGE P="349"/>
                            </P>
                            <P>(d) Use the clause at 252.236-7013, Requirement for Competition Opportunity for American Steel Producers, Fabricators, and Manufacturers, in solicitations and contracts that—</P>
                            <P>(1) Use funds appropriated for military construction); and</P>
                            <P>(2) May require the acquisition of steel as a construction material.</P>
                            <P>(e) Also see 246.710(4) for an additional clause applicable to construction contracts to be performed in Germany.</P>
                            <CITA>[56 FR 36421, July 31, 1991, as amended at 57 FR 42632, Sept. 15, 1992; 62 FR 2856, Jan. 17, 1997; 62 FR 34127, June 24, 1997; 63 FR 11538, Mar. 9, 1998; 65 FR 63804, Oct. 25, 2000; 68 FR 7440, Feb. 14, 2003; 70 FR 35545, June 21, 2005; 73 FR 46817, Aug. 12, 2008; 74 FR 2418, Jan. 15, 2009; 79 FR 44316, July 31, 2014; 80 FR 15911, Mar. 26, 2015]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 236.6—Architect-Engineer Services</HD>
                        <SECTION>
                            <SECTNO>236.601</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(1) Written notification to the congressional defense committees is required if the total estimated contract price for architect-engineer services or construction design, in connection with military construction, military family housing, or restoration or replacement of damaged or destroyed facilities, exceeds $1.5 million. In accordance with 10 U.S.C. 480, unclassified notifications must be provided by electronic medium.</P>
                            <P>(i) For military construction or military family housing (10 U.S.C. 2807(b)), the notification—</P>
                            <P>(A) Must include the scope of the project and the estimated contract price; and</P>
                            <P>
                                (B)(
                                <E T="03">1</E>
                                ) If provided by electronic medium, must be provided at least 14 days before the initial obligation of funds; or
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) If provided by other than electronic medium, must be received by the congressional defense committees at least 21 days before the initial obligation of funds.
                            </P>
                            <P>(ii) For restoration or replacement of damaged or destroyed facilities (10 U.S.C. 2854(b)), the notification—</P>
                            <P>(A) Must include the justification for the project, the estimated contract price, and the source of the funds for the project; and</P>
                            <P>
                                (B)(
                                <E T="03">1</E>
                                ) If provided by electronic medium, must be provided at least 7 days before the initial obligation of funds; or
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) If provided by other than electronic medium, must be received by the congressional defense committees at least 21 days before the initial obligation of funds.
                            </P>
                            <P>(2) During the applicable notice period, synopsis of the proposed contract action and administrative actions leading to the award may be started.</P>
                            <CITA>[71 FR 58541, Oct. 4, 2006, as amended at 80 FR 36905, June 26, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>236.602</SECTNO>
                            <SUBJECT>Selection of firms for architect-engineer contracts.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>236.602-1</SECTNO>
                            <SUBJECT>Selection criteria.</SUBJECT>
                            <P>(a) Establish the evaluation criteria before making the public announcement required by FAR 5.205(d) and include the criteria and their relative order of importance in the announcement. Follow the procedures at PGI 236.602-1(a).</P>
                            <CITA>[69 FR 75000, Dec. 15, 2004, as amended at 71 FR 53044, Sept. 8, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>236.602-70</SECTNO>
                            <SUBJECT>Restriction on award of overseas architect-engineer contracts to foreign firms.</SUBJECT>
                            <P>
                                In accordance with section 111 of the Military Construction and Veterans Affairs and Related Agencies Appropriations Act, 2015 (Division I of Pub. L. 113-235) and the same provision in subsequent military construction appropriations acts, architect-engineer contracts funded by military construction appropriations that are estimated to exceed $500,000 and are to be performed in Japan, in any North Atlantic Treaty Organization member country, or in countries bordering the Arabian Gulf (
                                <E T="03">i.e.,</E>
                                 Iran, Oman, United Arab Emirates, Saudi Arabia, Qatar, Bahrain, Kuwait, and Iraq), shall be awarded only to United States firms or to joint ventures of United States and host nation firms.
                            </P>
                            <CITA>[80 FR 15911, Mar. 26, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="350"/>
                            <SECTNO>236.604</SECTNO>
                            <SUBJECT>Performance evaluation.</SUBJECT>
                            <P>Prepare a separate performance evaluation after actual construction of the project. Ordinarily, the evaluating official should be the person most familiar with the architect-engineer contractor's performance.</P>
                            <CITA>[76 FR 58155, Sept. 20, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>236.606</SECTNO>
                            <SUBJECT>Negotiations.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>236.606-70</SECTNO>
                            <SUBJECT>Statutory fee limitation.</SUBJECT>
                            <P>(a) The statutes at 10 U.S.C. 7540, 8612, and 9540, for the Departments of the Army, Navy, and Air Force, respectively, limit the contract price (or fee) for architect-engineer services for the preparation of designs, plans, drawings, and specifications to 10 percent of the project's estimated construction cost.</P>
                            <P>(b) The 10 percent limit also applies to contract modifications, including modifications involving—</P>
                            <P>(1) Work not initially included in the contract; apply the 10 percent limit to the revised total estimated construction cost; and</P>
                            <P>(2) Redesign work; apply the 10 percent limit by—</P>
                            <P>(i) Adding the estimated construction cost of the redesign features to the original estimated construction cost;</P>
                            <P>(ii) Adding the contract cost for the original design to the contract cost for redesign; and</P>
                            <P>(iii) Dividing the total contract design cost by the total estimated construction cost. The resulting percentage may not exceed the 10 percent statutory limitation.</P>
                            <P>(c) The 10 percent limit applies only to that portion of the contract (or modification) price attributable to the preparation of designs, plans, drawings, and specifications. If a contract or modification also includes other services, the part of the price attributable to the other services is not subject to the 10 percent limit.</P>
                            <CITA>[89 FR 53504, June 27, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>236.609</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>236.609-70</SECTNO>
                            <SUBJECT>Additional provision.</SUBJECT>
                            <P>Use the provision at 252.236-7011, Overseas Architect-Engineer Services—Restriction to United States Firms, in solicitations for architect-engineer contracts that are—</P>
                            <P>(1) Funded with military construction appropriations;</P>
                            <P>(2) Estimated to exceed $500,000; and</P>
                            <P>(3) To be performed in Japan, in any North Atlantic Treaty Organization member country, or in countries bordering the Arabian Gulf.</P>
                            <CITA>[56 FR 36421, July 31, 1991, as amended at 62 FR 2858, Jan. 17, 1997; 63 FR 11539, Mar. 9, 1998; 76 FR 58156, Sept. 20, 2011; 79 FR 44316, July 31, 2014; 80 FR 15911, Mar. 26, 2015; 83 FR 54681, Oct. 31, 2018]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 236.7—Standard and Optional Forms for Contracting for Construction, Architect-Engineer Services, and Dismantling, Demolition, or Removal of Improvements</HD>
                        <SECTION>
                            <SECTNO>236.701</SECTNO>
                            <SUBJECT>Standard and optional forms for use in contracting for construction or dismantling, demolition, or removal of improvements.</SUBJECT>
                            <P>(c) Do not use Optional Form 347, Order for Supplies or Services (see 213.307).</P>
                            <CITA>[56 FR 36421, July 31, 1991, as amended at 65 FR 63804, Oct. 25, 2000]</CITA>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 237</EAR>
                    <HD SOURCE="HED">PART 237—SERVICE CONTRACTING</HD>
                    <CONTENTS>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 237.1—Service Contracts—General</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>237.101</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>237.102</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>237.102-70</SECTNO>
                            <SUBJECT>Prohibition on contracting for firefighting or security-guard functions.</SUBJECT>
                            <SECTNO>237.102-71</SECTNO>
                            <SUBJECT>Limitation on service contracts for military flight simulators.</SUBJECT>
                            <SECTNO>237.102-72</SECTNO>
                            <SUBJECT>Contracts for management services.</SUBJECT>
                            <SECTNO>237.102-73</SECTNO>
                            <SUBJECT>Prohibition on contracts for services of senior mentors.</SUBJECT>
                            <SECTNO>237.102-74</SECTNO>
                            <SUBJECT>Taxonomy for the acquisition of services, and supplies and equipment.</SUBJECT>
                            <SECTNO>237.102-75</SECTNO>
                            <SUBJECT>Defense Acquisition Guidebook.</SUBJECT>
                            <SECTNO>237.102-76</SECTNO>
                            <SUBJECT>Acquisition of computer software and computer software documentation under services contracts.</SUBJECT>
                            <SECTNO>237.102-77</SECTNO>
                            <SUBJECT>Acquisition requirements roadmap tool.</SUBJECT>
                            <SECTNO>237.102-78</SECTNO>
                            <SUBJECT>
                                Market research report guide for improving the tradecraft in services acquisition.
                                <PRTPAGE P="351"/>
                            </SUBJECT>
                            <SECTNO>237.102-79</SECTNO>
                            <SUBJECT>Private sector notification requirements in support of in-sourcing actions.</SUBJECT>
                            <SECTNO>237.104</SECTNO>
                            <SUBJECT>Personal services contracts.</SUBJECT>
                            <SECTNO>237.106</SECTNO>
                            <SUBJECT>Funding and term of service contracts.</SUBJECT>
                            <SECTNO>237.109</SECTNO>
                            <SUBJECT>Services of quasi-military armed forces.</SUBJECT>
                            <SECTNO>237.170</SECTNO>
                            <SUBJECT>Approval of contracts and task orders for services.</SUBJECT>
                            <SECTNO>237.170-1</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>237.170-2</SECTNO>
                            <SUBJECT>Approval requirements.</SUBJECT>
                            <SECTNO>237.171</SECTNO>
                            <SUBJECT>Training for contractor personnel interacting with detainees.</SUBJECT>
                            <SECTNO>237.171-1</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>237.171-2</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <SECTNO>237.171-3</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>237.171-4</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <SECTNO>237.172</SECTNO>
                            <SUBJECT>Service contracts surveillance.</SUBJECT>
                            <SECTNO>237.173</SECTNO>
                            <SUBJECT>Prohibition on interrogation of detainees by contractor personnel.</SUBJECT>
                            <SECTNO>237.173-1</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>237.173-2</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>237.173-3</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>237.173-4</SECTNO>
                            <SUBJECT>Waiver.</SUBJECT>
                            <SECTNO>237.173-5</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <SECTNO>237.174</SECTNO>
                            <SUBJECT>Disclosure of information to litigation support contractors.</SUBJECT>
                            <SECTNO>237.175</SECTNO>
                            <SUBJECT>Training that uses live vertebrate animals.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 237.2—Advisory and Assistance Services</HD>
                            <SECTNO>237.270</SECTNO>
                            <SUBJECT>Acquisition of audit services.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 237.5—Management Oversight of Service Contracts</HD>
                            <SECTNO>237.503</SECTNO>
                            <SUBJECT>Agency-head responsibilities.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 237.70—Mortuary Services</HD>
                            <SECTNO>237.7000</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>237.7001</SECTNO>
                            <SUBJECT>Method of acquisition.</SUBJECT>
                            <SECTNO>237.7002</SECTNO>
                            <SUBJECT>Area of performance and distribution of contracts.</SUBJECT>
                            <SECTNO>237.7003</SECTNO>
                            <SUBJECT>Solicitation provisions and contract clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 237.71—Laundry and Dry Cleaning Services</HD>
                            <SECTNO>237.7100</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>237.7101</SECTNO>
                            <SUBJECT>Solicitation provisions and contract clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 237.72—Educational Service Agreements</HD>
                            <SECTNO>237.7200</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>237.7201</SECTNO>
                            <SUBJECT>Educational service agreement.</SUBJECT>
                            <SECTNO>237.7202</SECTNO>
                            <SUBJECT>Limitations.</SUBJECT>
                            <SECTNO>237.7203</SECTNO>
                            <SUBJECT>Duration.</SUBJECT>
                            <SECTNO>237.7204</SECTNO>
                            <SUBJECT>Format and clauses for educational service agreements.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 237.73—Services of Students at Research and Development Laboratories</HD>
                            <SECTNO>237.7300</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>237.7301</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>237.7302</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>237.7303</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 237.74—Services at Installations Being Closed</HD>
                            <SECTNO>237.7400</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>237.7401</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>237.7402</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 237.75—Acquisition and Management of Industrial Resources</HD>
                            <SECTNO>237.7501</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <SECTNO>237.7502</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 237.76—Continuation of Essential Contractor Services</HD>
                            <SECTNO>237.7600</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>237.7601</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>237.7602</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>237.7603</SECTNO>
                            <SUBJECT>Solicitation provision and contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 237.77—Competition for Religious-Related Services</HD>
                            <SECTNO>237.7700</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>237.7701</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <SECTNO>237.7702</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 237.78—Transfer and Adoption of Military Animals</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>237.7800</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>237.7801</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <SECTNO>237.7802</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>237.7803</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>237.7804</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36424, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 237.1—Service Contracts—General</HD>
                        <SECTION>
                            <SECTNO>237.101</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>
                                <E T="03">Increased performance of security-guard functions,</E>
                                 as used in this subpart, means—
                            </P>
                            <P>
                                (1) In the case of an installation or facility where no security-guard functions were performed as of September 10, 2001, the entire scope or extent of the performance of security-guard 
                                <PRTPAGE P="352"/>
                                functions at the installation or facility after such date; and
                            </P>
                            <P>(2) In the case of an installation or facility where security-guard functions were performed within a lesser scope of requirements or to a lesser extent as of September 10, 2001, than after such date, the increment of the performance of security-guard functions at the installation or facility that exceeds such lesser scope of requirements or extent of performance.</P>
                            <P>
                                <E T="03">Senior mentor</E>
                                 means a retired flag, general, or other military officer or retired senior civilian official who provides expert experience-based mentoring, teaching, training, advice, and recommendations to senior military officers, staff, and students as they participate in war games, warfighting courses, operational planning, operational exercises, and decision-making exercises.
                            </P>
                            <CITA>[68 FR 7443, Feb. 14, 2003, as amended at 75 FR 71564, Nov. 24, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.102</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>
                                (b)(1) 
                                <E T="03">Preference for certain commercial services.</E>
                                 See 212.272 for procedures for implementation of the preference for commercial facilities-related services, knowledge-based services (except engineering services), medical services, or transportation services, as required by section 876 of the National Defense Authorization Act for Fiscal Year 2017 (Pub. L. 114-328).
                            </P>
                            <P>
                                (2) 
                                <E T="03">Public-private competitions.</E>
                                 See PGI 207.302 for information on the Governmentwide moratorium and restrictions on public-private competitions conducted pursuant to Office of Management and Budget (OMB) Circular A-76.
                            </P>
                            <P>(c) In addition to the prohibition on award of contracts for the performance of inherently governmental functions, contracting officers shall not award contracts for functions that are exempt from private sector performance. See 207.503(e) for the associated documentation requirement.</P>
                            <P>(e) Program officials shall obtain assistance from contracting officials through the Peer Review process at 201.170.</P>
                            <CITA>[73 FR 1826, Jan. 10, 2008, as amended at 74 FR 37626, July 29, 2009; 81 FR 36473, June 7, 2016; 84 FR 39204, Aug. 9, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.102-70</SECTNO>
                            <SUBJECT>Prohibition on contracting for firefighting or security-guard functions.</SUBJECT>
                            <P>(a) Under 10 U.S.C. 2465, the DoD is prohibited for entering into contracts for the performance of firefighting or security-guard functions at any military installation or facility unless—</P>
                            <P>(1) The contract is to be carried out at a location outside the United States and its outlying areas at which members of the armed forces would have to be used for the performance of firefighting or security-guard functions at the expense of unit readiness;</P>
                            <P>(2) The contract will be carried out on a Government-owned but privately operated installation;</P>
                            <P>(3) The contract (or renewal of a contract) is for the performance of a function under contract on September 24, 1983; or</P>
                            <P>(4) The contract—</P>
                            <P>(i) Is for the performance of firefighting functions;</P>
                            <P>(ii) Is for a period of 1 year or less; and</P>
                            <P>(iii) Covers only the performance of firefighting functions that, in the absence of the contract, would have to be performed by members of the armed forces who are not readily available to perform such functions by reason of a deployment.</P>
                            <P>(b) Under Section 2907 of Public Law 103-160, this prohibition does not apply to services at installations being closed (see subpart 237.74).</P>
                            <P>(c)(1) Under section 332 of Public Law 107-314, as amended by section 333 of Public Law 109-364 and section 343 of Public Law 110-181, this prohibition does not apply to any contract that is entered into for any increased performance of security-guard functions at a military installation or facility undertaken in response to the terrorist attacks on the United States on September 11, 2001, if—</P>
                            <P>(i) Without the contract, members of the Armed Forces are or would be used to perform the increased security-guard functions;</P>
                            <P>(ii) The agency has determined that—</P>
                            <P>
                                (A) Recruiting and training standards for the personnel who are to perform the security-guard functions are comparable to the recruiting and training standards for DoD personnel who 
                                <PRTPAGE P="353"/>
                                perform the same security-guard functions;
                            </P>
                            <P>(B) Contractor personnel performing such functions will be effectively supervised, reviewed, and evaluated; and</P>
                            <P>(C) Performance of such functions will not result in a reduction in the security of the installation or facility;</P>
                            <P>(iii) Contract performance will not extend beyond September 30, 2012; and</P>
                            <P>(iv) The total number of personnel employed to perform security-guard functions under all contracts entered into pursuant to this authority does not exceed the following limitations:</P>
                            <P>(A) For fiscal year 2007, the total number of such personnel employed under such contracts on October 1, 2006.</P>
                            <P>(B) For fiscal year 2008, the number equal to 90 percent of the total number of such personnel employed under such contracts on October 1, 2006.</P>
                            <P>(C) For fiscal year 2009, the number equal to 80 percent of the total number of such personnel employed under such contracts on October 1, 2006.</P>
                            <P>(D) For fiscal year 2010, the number equal to 70 percent of the total number of such personnel employed under such contracts on October 1, 2006.</P>
                            <P>(E) For fiscal year 2011, the number equal to 60 percent of the total number of such personnel employed under such contracts on October 1, 2006.</P>
                            <P>(F) For fiscal year 2012, the number equal to 50 percent of the total number of such personnel employed under such contracts on October 1, 2006.</P>
                            <P>(2) Follow the procedures at PGI 237.102-70(c) to ensure that the personnel limitations specified in paragraph (c)(1)(iv) of this section are not exceeded.</P>
                            <CITA>[60 FR 61599, Nov. 30, 1995, as amended at 67 FR 11439, Mar. 14, 2002; 68 FR 7443, Feb. 14, 2003; 69 FR 35533, June 25, 2004; 70 FR 14577, Mar. 23, 2005; 70 FR 35545, June 21, 2005; 71 FR 34834, June 16, 2006; 72 FR 51192, Sept. 6, 2007; 73 FR 53157, Sept. 15, 2008; 84 FR 65311, Nov. 27, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.102-71</SECTNO>
                            <SUBJECT>Limitation on service contracts for military flight simulators.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Definitions.</E>
                                 As used in this subsection—
                            </P>
                            <P>
                                (1) 
                                <E T="03">Military flight simulator</E>
                                 means any system to simulate the form, fit, and function of a military aircraft that has no commonly available commercial variant.
                            </P>
                            <P>
                                (2) 
                                <E T="03">Service contract</E>
                                 means any contract entered into by DoD, the principal purpose of which is to furnish services in the United States through the use of service employees as defined in 41 U.S.C. 6701.
                            </P>
                            <P>(b) Under Section 832 of Public Law 109-364, as amended by Section 883(b) of Public Law 110-181, DoD is prohibited from entering into a service contract to acquire a military flight simulator. However, the Secretary of Defense may waive this prohibition with respect to a contract, if the Secretary—</P>
                            <P>(1) Determines that a waiver is in the national interest; and</P>
                            <P>(2) Provides an economic analysis to the congressional defense committees at least 30 days before the waiver takes effect. This economic analysis shall include, at a minimum—</P>
                            <P>(i) A clear explanation of the need for the contract; and</P>
                            <P>(ii) An examination of at least two alternatives for fulfilling the requirements that the contract is meant to fulfill, including the following with respect to each alternative:</P>
                            <P>(A) A rationale for including the alternative.</P>
                            <P>(B) A cost estimate of the alternative and an analysis of the quality of each cost estimate.</P>
                            <P>(C) A discussion of the benefits to be realized from the alternative.</P>
                            <P>(D) A best value determination of each alternative and a detailed explanation of the life-cycle cost calculations used in the determination.</P>
                            <P>(c) When reviewing requirements or participating in acquisition planning that would result in a military department or defense agency acquiring a military flight simulator, the contracting officer shall notify the program officials of the prohibition in paragraph (b) of this subsection. If the program officials decide to request a waiver from the Secretary of Defense under paragraph (b) of this subsection, the contracting officer shall follow the procedures at PGI 237.102-71.</P>
                            <CITA>[72 FR 51193, Sept. 6, 2007, as amended at 73 FR 53156, Sept. 15, 2008; 76 FR 58137, Sept. 20, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="354"/>
                            <SECTNO>237.102-72</SECTNO>
                            <SUBJECT>Contracts for management services.</SUBJECT>
                            <P>In accordance with Section 802 of the National Defense Authorization Act for Fiscal Year 2008 (Pub. L. 110-181), DoD may award a contract for the acquisition of services the primary purpose of which is to perform acquisition support functions with respect to the development or production of a major system, only if—</P>
                            <P>(a) The contract prohibits the contractor from performing inherently governmental functions;</P>
                            <P>(b) The DoD organization responsible for the development or production of the major system ensures that Federal employees are responsible for determining—</P>
                            <P>(1) Courses of action to be taken in the best interest of the Government; and</P>
                            <P>(2) Best technical performance for the warfighter; and</P>
                            <P>(c) The contract requires that the prime contractor for the contract may not advise or recommend the award of a contract or subcontract for the development or production of the major system to an entity owned in whole or in part by the prime contractor.</P>
                            <CITA>[74 FR 34269, July 15, 2009]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.102-73</SECTNO>
                            <SUBJECT>Prohibition on contracts for services of senior mentors.</SUBJECT>
                            <P>
                                DoD is prohibited from entering into contracts for the services of senior mentors. 
                                <E T="03">See</E>
                                 PGI 237.102-73 for references to DoD policy and implementation guidance.
                            </P>
                            <CITA>[75 FR 71564, Nov. 24, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.102-74</SECTNO>
                            <SUBJECT>Taxonomy for the acquisition of services, and supplies and equipment.</SUBJECT>
                            <P>See PGI 237.102-74 for further guidance on the taxonomy for the acquisition of services and the acquisition of supplies and equipment.</P>
                            <CITA>[79 FR 51264, Aug. 28, 2014]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.102-75</SECTNO>
                            <SUBJECT>Defense Acquisition Guidebook.</SUBJECT>
                            <P>See PGI 237.102-75 for information on the Defense Acquisition Guidebook, Chapter 10, Acquisition of Services.</P>
                            <CITA>[81 FR 36473, June 7, 2016, as amended at 82 FR 61481, Dec. 28, 2017]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.102-76</SECTNO>
                            <SUBJECT>Acquisition of computer software and computer software documentation under services contracts.</SUBJECT>
                            <P>
                                (a) See 
                                <E T="03">227.7202</E>
                                 for policy on the acquisition of commercial computer software and commercial computer software documentation for services contracts that require the development or modification of commercial computer software.
                            </P>
                            <P>(b) See 227.7203 for policy on the acquisition of other than commercial computer software and other than commercial computer software documentation for services contracts that require the development or modification of other than commercial computer software.</P>
                            <CITA>[88 FR 17344, Mar. 22, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.102-77</SECTNO>
                            <SUBJECT>Acquisition requirements roadmap tool.</SUBJECT>
                            <P>See PGI 237.102-77 for guidance on using the Acquisition Requirements Roadmap Tool to develop and organize performance requirements into draft versions of the performance work statement, the quality assurance surveillance plan, and the performance requirements summary.</P>
                            <CITA>[77 FR 52254, Aug. 29, 2012, as amended at 81 FR 36473, June 7, 2016]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.102-78</SECTNO>
                            <SUBJECT>Market research report guide for improving the tradecraft in services acquisition.</SUBJECT>
                            <P>See PGI 210.070 for guidance on use of the market research report guide to conduct and document market research for service acquisitions.</P>
                            <CITA>[77 FR 52254, Aug. 29, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.102-79</SECTNO>
                            <SUBJECT>Private sector notification requirements in support of in-sourcing actions.</SUBJECT>
                            <P>
                                In accordance with 10 U.S.C. 2463, contracting officers shall provide written notification to affected incumbent contractors of Government in-sourcing 
                                <PRTPAGE P="355"/>
                                determinations. Notification shall be provided within 20 business days of the contracting officer's receipt of a decision from the cognizant component in-sourcing program official. The notification will summarize the requiring official's final determination as to why the service is being in-sourced and shall be coordinated with the component's in-sourcing program official. No formal hiring or contract-related actions may be initiated prior to such notification, except for preliminary internal actions associated with hiring or contract modification. See the OASD (RFM) memorandum entitled “Private Sector Notification Requirements in Support of In-sourcing Actions,” dated January 29, 2013, for further information, which is available at PGI 237.102-79.
                            </P>
                            <CITA>[78 FR 65219, Oct. 31, 2013, as amended at 79 FR 35701, June 24, 2014]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.104</SECTNO>
                            <SUBJECT>Personal services contracts.</SUBJECT>
                            <P>(b)(i) Authorization to acquire the personal services of experts and consultants is included in 10 U.S.C. 129b. Personal service contracts for expert and consultant services must also be authorized by a determination and findings (D&amp;F) in accordance with department/agency regulations.</P>
                            <P>(A) Generally, the D&amp;F should authorize one contract at a time; however, an authorizing official may issue a blanket D&amp;F for classes of contracts.</P>
                            <P>(B) Prepare each D&amp;F in accordance with FAR 1.7 and include a determination that—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) The duties are of a temporary or intermittent nature;
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Acquisition of the services is advantageous to the national defense;
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) DoD personnel with necessary skills are not available;
                            </P>
                            <P>
                                (
                                <E T="03">4</E>
                                ) Excepted appointment cannot be obtained;
                            </P>
                            <P>
                                (
                                <E T="03">5</E>
                                ) A nonpersonal services contract is not practicable;
                            </P>
                            <P>
                                (
                                <E T="03">6</E>
                                ) Statutory authority, 5 U.S.C. 3109 and other legislation, apply; and
                            </P>
                            <P>
                                (
                                <E T="03">7</E>
                                ) Any other determination required by statutes has been made.
                            </P>
                            <P>(ii) Personal services contracts for health care are authorized by 10 U.S.C. 1091.</P>
                            <P>(A) This authority may be used to acquire—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Direct health care services provided in medical treatment facilities;
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Health care services at locations outside of medical treatment facilities (such as the provision of medical screening examinations at military entrance processing stations); and
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) Services of clinical counselors, family advocacy program staff, and victim's services representatives to members of the Armed Forces and covered beneficiaries who require such services, provided in medical treatment facilities or elsewhere. Persons with whom a personal services contract may be entered into under this authority include clinical social workers, psychologists, psychiatrists, and other comparable professionals who have advanced degrees in counseling or related academic disciplines and who meet all requirements for State licensure and board certification requirements, if any, within their fields of specialization.
                            </P>
                            <P>(B) Sources for personal services contracts with individuals under the authority of 10 U.S.C. 1091 shall be selected through the procedures in this section. These procedures do not apply to contracts awarded to business entities other than individuals. Selections made using the procedures in this section are exempt by statute from FAR part 6 competition requirements (see 206.001(b)).</P>
                            <P>(C) Approval requirements for—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Direct health care personal services contracts (see paragraphs (b)(ii)(A)(
                                <E T="03">1</E>
                                ) and (
                                <E T="03">2</E>
                                ) of this section) and a pay cap are in DoDI 6025.5, Personal Services Contracts for Health Care Providers.
                            </P>
                            <P>
                                (
                                <E T="03">i</E>
                                ) A request to enter into a personal services contract for direct health care services must be approved by the commander of the medical/dental treatment facility where the services will be performed.
                            </P>
                            <P>
                                (
                                <E T="03">ii</E>
                                ) A request to enter into a personal services contract for a location outside of a medical treatment facility must be approved by the chief of the medical facility who is responsible for the area in which the services will be performed.
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Services of clinical counselors, family advocacy program staff, and victim's services representatives (see paragraph (b)(ii)(A)(
                                <E T="03">3</E>
                                ) of this section), 
                                <PRTPAGE P="356"/>
                                shall be in accordance with agency procedures.
                            </P>
                            <P>(D) The contracting officer must ensure that the requiring activity provides a copy of the approval with the purchase request.</P>
                            <P>(E) The contracting officer must provide adequate advance notice of contracting opportunities to individuals residing in the area of the facility. The notice must include the qualification criteria against which individuals responding will be evaluated. The contracting officer shall solicit applicants through at least one local publication which serves the area of the facility. Acquisitions under this section for personal service contracts are exempt from the posting and synopsis requirements of FAR part 5.</P>
                            <P>(F) The contracting officer shall provide the qualifications of individuals responding to the notice to the commander of the facility for evaluation and ranking in accordance with agency procedures. Individuals must be considered solely on the basis of the professional qualifications established for the particular personal services being acquired and the Government's estimate of reasonable rates, fees, or other costs. The commander of the facility shall provide the contracting officer with rationale for the ranking of individuals, consistent with the required qualifications.</P>
                            <P>(G) Upon receipt from the facility of the ranked listing of applicants, the contracting officer shall either—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Enter into negotiations with the highest ranked applicant. If a mutually satisfactory contract cannot be negotiated, the contracting officer shall terminate negotiations with the highest ranked applicant and enter into negotiations with the next highest.
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Enter into negotiations with all qualified applicants and select on the basis of qualifications and rates, fees, or other costs.
                            </P>
                            <P>(H) In the event only one individual responds to an advertised requirement, the contracting officer is authorized to negotiate the contract award. In this case, the individual must still meet the minimum qualifications of the requirement and the contracting officer must be able to make a determination that the price is fair and reasonable.</P>
                            <P>(I) If a fair and reasonable price cannot be obtained from a qualified individual, the requirement should be canceled and acquired using procedures other than those set forth in this section.</P>
                            <P>(iii) (A) In accordance with 10 U.S.C. 129b(d), an agency may enter into a personal services contract if—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) The personal services—
                            </P>
                            <P>
                                (
                                <E T="03">i</E>
                                ) Are to be provided by individuals outside the United States, regardless of their nationality;
                            </P>
                            <P>
                                (
                                <E T="03">ii</E>
                                ) Directly support the mission of a defense intelligence component or counter-intelligence organization of DoD; or
                            </P>
                            <P>
                                (
                                <E T="03">iii</E>
                                ) Directly support the mission of the special operations command of DoD; and
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) The head of the contracting activity provides written approval for the proposed contract. The approval shall include a determination that addresses the following:
                            </P>
                            <P>
                                (
                                <E T="03">i</E>
                                ) The services to be procured are urgent or unique;
                            </P>
                            <P>
                                (
                                <E T="03">ii</E>
                                ) It would not be practical to obtain such services by other means; and
                            </P>
                            <P>
                                (
                                <E T="03">iii</E>
                                ) For acquisition of services in accordance with paragraph (b)(iii)(A)(
                                <E T="03">1</E>
                                )(
                                <E T="03">i</E>
                                ) of this section, the services to be acquired are necessary and appropriate for supporting DoD activities and programs outside the United States.
                            </P>
                            <P>
                                (B) The contracting officer shall ensure that the applicable requirements of paragraph (b)(iii)(A)(
                                <E T="03">2</E>
                                ) of this section have been satisfied and shall include the approval documentation in the contract file.
                            </P>
                            <P>(iv) The requirements of 5 U.S.C. 3109, Employment of Experts and Consultants; Temporary or Intermittent, do not apply to contracts entered into in accordance with paragraph (b)(iii) of this section.</P>
                            <P>(d) See 237.503(c) for requirements for certification and approval of requirements for services to prevent contracts from being awarded or administered in a manner that constitutes an unauthorized personal services contract.</P>
                            <P>
                                (f)(i) Payment to each expert or consultant for personal services under 5 U.S.C. 3109 shall not exceed the highest rate fixed by the Classification Act Schedules for grade GS-15 (see 5 CFR 304.105(a)).
                                <PRTPAGE P="357"/>
                            </P>
                            <P>(ii) The contract may provide for the same per diem and travel expenses authorized for a Government employee, including actual transportation and per diem in lieu of subsistence for travel between home or place of business and official duty station.</P>
                            <P>(iii) Coordinate with the civilian personnel office on benefits, taxes, personnel ceilings, and maintenance of records.</P>
                            <CITA>[56 FR 36424, July 31, 1991, as amended at 60 FR 2888, Jan. 12, 1995; 60 FR 61599, Nov. 30, 1995; 63 FR 11539, Mar. 9, 1998; 67 FR 61516, Oct. 1, 2002; 69 FR 55992, Sept. 17, 2004; 76 FR 25566, May 5, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.106</SECTNO>
                            <SUBJECT>Funding and term of service contracts.</SUBJECT>
                            <P>(1) Personal service contracts for expert or consultant services shall not exceed 1 year. The nature of the duties must be—</P>
                            <P>(i) Temporary (not more than 1 year); or</P>
                            <P>(ii) Intermittent (not cumulatively more than 130 days in 1 year).</P>
                            <P>(2) The contracting officer may enter into a contract, exercise an option, or place an order under a contract for severable services for a period that begins in one fiscal year and ends in the next fiscal year if the period of the contract awarded, option exercised, or order placed does not exceed 1 year (10 U.S.C. 3133).</P>
                            <CITA>[64 FR 28110, May 25, 1999, as amended at 87 FR 76995, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.109</SECTNO>
                            <SUBJECT>Services of quasi-military armed forces.</SUBJECT>
                            <P>See 237.102-70b for prohibition on contracting for firefighting or security-guard functions.</P>
                            <CITA>[60 FR 61599, Nov. 30, 1995]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.170</SECTNO>
                            <SUBJECT>Approval of contracts and task orders for services.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.170-1</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>This section—</P>
                            <P>(a) Implements 10 U.S.C. 4501; and</P>
                            <P>(b) Applies to services acquired for DoD, regardless of whether the services are acquired through—</P>
                            <P>(1) A DoD contract or task order; or</P>
                            <P>(2) A contract or task order awarded by an agency other than DoD.</P>
                            <CITA>[68 FR 56564, Oct. 1, 2003, as amended at 87 FR 76995, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.170-2</SECTNO>
                            <SUBJECT>Approval requirements.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Acquisition of services through a contract or task order that is not performance based.</E>
                                 (1) For acquisitions at or below $100 million, obtain the approval of the official designated by the department or agency.
                            </P>
                            <P>(2) For acquisitions exceeding $100 million, obtain the approval of the senior procurement executive.</P>
                            <P>
                                (b) 
                                <E T="03">Acquisition of services through use of a contract or task order issued by a non-DoD agency.</E>
                                 Comply with the review, approval, and reporting requirements established in accordance with subpart 217.7 when acquiring services through use of a contract or task order issued by a non-DoD agency.
                            </P>
                            <CITA>[70 FR 29643, May 24, 2005, as amended at 71 FR 14104, Mar. 21, 2006; 71 FR 75893, Dec. 19, 2006; 75 FR 45074, Aug. 2, 2010; 80 FR 36905, June 26, 2015; 80 FR 67255, Oct. 30, 2015; 85 FR 61504, Sept. 29, 2020]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.171</SECTNO>
                            <SUBJECT>Training for contractor personnel interacting with detainees.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.171-1</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>This section prescribes policies to prevent the abuse of detainees, as required by Section 1092 of the National Defense Authorization Act for Fiscal Year 2005 (Pub. L. 108-375).</P>
                            <CITA>[70 FR 52033, Sept. 1, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.171-2</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <P>
                                <E T="03">Combatant commander</E>
                                , 
                                <E T="03">detainee</E>
                                , and 
                                <E T="03">personnel interacting with detainees</E>
                                , as used in this section, are defined in the clause at 252.237-7019, Training for Contractor Personnel Interacting with Detainees.
                            </P>
                            <CITA>[71 FR 53048, Sept. 8, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.171-3</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(a) Each DoD contract in which contractor personnel, in the course of their duties, interact with detainees shall include a requirement that such contractor personnel—</P>
                            <P>
                                (1) Receive Government-provided training regarding the international obligations and laws of the United 
                                <PRTPAGE P="358"/>
                                States applicable to the detention of personnel, including the Geneva Conventions; and
                            </P>
                            <P>(2) Provide a copy of the training receipt document to the contractor.</P>
                            <P>(b) The combatant commander responsible for the area where the detention or interrogation facility is located will arrange for the training and a training receipt document to be provided to contractor personnel. For information on combatant commander geographic areas of responsibility and point of contact information for each command, see PGI 237.171-3(b).</P>
                            <CITA>[71 FR 53048, Sept. 8, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.171-4</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at 252.237-7019, Training for Contractor Personnel Interacting with Detainees, in in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, that are for the acquisition of services if—</P>
                            <P>(a) The clause at 252.225-7040, Contractor Personnel Supporting U.S. Armed Forces Deployed Outside the United States, is included in the solicitation or contract; or</P>
                            <P>(b) The services will be performed at a facility holding detainees, and contractor personnel in the course of their duties may be expected to interact with the detainees.</P>
                            <CITA>[70 FR 52033, Sept. 1, 2005, as amended at 78 FR 37989, June 25, 2013; 79 FR 30471, May 28, 2014; 88 FR 6587, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.172</SECTNO>
                            <SUBJECT>Service contracts surveillance.</SUBJECT>
                            <P>
                                (a) Ensure that quality assurance surveillance plans are prepared in conjunction with the preparation of the statement of work or statement of objectives for solicitations and contracts for services. These plans should be tailored to address the performance risks inherent in the specific contract type and the work effort addressed by the contract. (See FAR subpart 46.4.) Retain quality assurance surveillance plans in the contract file. See 
                                <E T="03">http://sam.dau.mil,</E>
                                 Step Four—Requirements Definition, for examples of quality assurance surveillance plans.
                            </P>
                            <P>(b) See PGI 216.505-70 for guidance regarding minimum labor category qualifications for orders issued under multiple award services contracts.</P>
                            <CITA>[80 FR 58632, Sept. 30, 2015, as amended at 84 FR 48510, Sept. 13, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.173</SECTNO>
                            <SUBJECT>Prohibition on interrogation of detainees by contractor personnel.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.173-1</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>This section prescribes policies that prohibit interrogation of detainees by contractor personnel, as required by section 1038 of the Fiscal Year 2010 National Defense Authorization Act (Pub. L. 111-84).</P>
                            <CITA>[75 FR 67633, Nov. 3, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.173-2</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this subpart—</P>
                            <P>
                                <E T="03">Detainee</E>
                                 means any person captured, detained, held, or otherwise under the effective control of DoD personnel (military or civilian) in connection with hostilities. This includes, but is not limited to, enemy prisoners of war, civilian internees, and retained personnel. This does not include DoD personnel or DoD contractor personnel being held for law enforcement purposes.
                            </P>
                            <P>
                                <E T="03">Interrogation of detainees</E>
                                 means a systematic process of formally and officially questioning a detainee for the purpose of obtaining reliable information to satisfy foreign intelligence collection requirements.
                            </P>
                            <CITA>[75 FR 67633, Nov. 3, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.173-3</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(a) No detainee may be interrogated by contractor personnel.</P>
                            <P>(b) Contractor personnel with proper training and security clearances may be used as linguists, interpreters, report writers, information technology technicians, and other employees filling ancillary positions, including as trainers of and advisors to interrogators, in interrogations of detainees if—</P>
                            <P>
                                (1) Such personnel are subject to the same laws, rules, procedures, and policies (including DoD Instruction 1100.22, Policy and Procedures for Determining Workforce Mix (
                                <E T="03">
                                    http://www.dtic.mil/whs/
                                    <PRTPAGE P="359"/>
                                    directives/corres/pdf/110022p.pdf
                                </E>
                                ); DoD Directive 2310.01E, The Department of Defense Detainee Program (
                                <E T="03">http://www.dtic.mil/whs/directives/corres/pdf/231001p.pdf</E>
                                ); and DoD Directive 3115.09, DoD Intelligence Interrogations, Detainee Debriefings, and Tactical Questioning (
                                <E T="03">http://www.dtic.mil/whs/directives/corres/pdf/311509p.pdf</E>
                                )); pertaining to detainee operations and interrogations as those that apply to Government personnel in such positions in such interrogations; and
                            </P>
                            <P>(2) Appropriately qualified and trained DoD personnel (military or civilian) are available to oversee the contractor's performance and to ensure that contractor personnel do not perform activities that are prohibited under this section.</P>
                            <CITA>[75 FR 67633, Nov. 3, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.173-4</SECTNO>
                            <SUBJECT>Waiver.</SUBJECT>
                            <P>The Secretary of Defense may waive the prohibition in 237.173-3(a) for a period of 60 days, if the Secretary determines such a waiver is vital to the national security interests of the United States. The Secretary may renew a waiver issued pursuant to this paragraph for an additional 30-day period, if the Secretary determines that such a renewal is vital to the national security interests of the United States. Not later than five days after issuance of the waiver, the Secretary shall submit written notification to Congress. See specific waiver procedures at DoDI 1100.22.</P>
                            <CITA>[75 FR 67633, Nov. 3, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.173-5</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Insert the clause at 252.237-7010, Prohibition on Interrogation of Detainees by Contractor Personnel, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, that are for the provision of services.</P>
                            <CITA>[75 FR 67633, Nov. 3, 2010, as amended at 78 FR 37989, June 25, 2013; 88 FR 6588, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.174</SECTNO>
                            <SUBJECT>Disclosure of information to litigation support contractors.</SUBJECT>
                            <P>See 204.74 for disclosure of information to litigation support contractors.</P>
                            <CITA>[79 FR 11340, Feb. 28, 2014]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.175</SECTNO>
                            <SUBJECT>Training that uses live vertebrate animals.</SUBJECT>
                            <P>Use the clause at 252.235-7002, Animal Welfare, as prescribed in 235.072(a), when contracting for training that will use live vertebrate animals.</P>
                            <CITA>[79 FR 73501, Dec. 11, 2014]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 237.2—Advisory and Assistance Services</HD>
                        <SECTION>
                            <SECTNO>237.270</SECTNO>
                            <SUBJECT>Acquisition of audit services.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">General policy.</E>
                                 (1) Do not contract for audit services unless—
                            </P>
                            <P>(i) The cognizant DoD audit organization determines that expertise required to perform the audit is not available within the DoD audit organization; or</P>
                            <P>(ii) Temporary audit assistance is required to meet audit reporting requirements mandated by law or DoD regulation.</P>
                            <P>(2) See 215.101-2-70(b)(3) for the prohibition on the use of the lowest price technically acceptable source selection process when acquiring audit services.</P>
                            <P>(3) See PGI 237.270 for a list of DoD publications that govern the conduct of audits.</P>
                            <P>
                                (b) 
                                <E T="03">Contract period.</E>
                                 Except in unusual circumstances, award contracts for recurring audit services for a 1-year period with at least 2 option years.
                            </P>
                            <P>
                                (c) 
                                <E T="03">Approvals.</E>
                                 Do not issue a solicitation for audit services unless the requiring activity provides evidence that the cognizant DoD audit organization has approved the statement of work. The requiring agency shall obtain the same evidence of approval for subsequent material changes to the statement of work.
                            </P>
                            <P>
                                (d) 
                                <E T="03">Transparency requirement for firms used to support DoD audits.</E>
                            </P>
                            <P>
                                (1) This paragraph (d) implements the requirements of section 1006 of the National Defense Authorization Act for Fiscal Year 2019 (Pub. L. 115-232) and section 1011 of the National Defense Authorization Act for Fiscal Year 2020 
                                <PRTPAGE P="360"/>
                                (Pub. L. 116-92) for transparency of accounting firms used to support DoD audits; and extends the statutory requirement, as a matter of DoD policy, to firms other than accounting firms in order to ensure consistent availability of data for contracting officer evaluation and appropriate use.
                            </P>
                            <P>(2) This requirement applies to solicitations and contracts for—</P>
                            <P>(i) Financial statement auditing required under 31 U.S.C. 3521(e); or</P>
                            <P>(ii) Audit remediation services in support of the Financial Improvement and Audit Remediation Plan described in 10 U.S.C. 240b.</P>
                            <P>(3) Any firm responding to a solicitation or awarded a contract for the acquisition of the services described in paragraph (d)(2) of this section is required to represent with regard to whether it has been subject to disciplinary proceedings within the last 3 years and, if the offeror represents that it has, to disclose to DoD before any contract action (including award, renewals, and modifications)—</P>
                            <P>(i) The details of any disciplinary proceedings, with respect to the firm or its associated persons (including principals and employees), before an entity with the authority to enforce compliance with rules or laws applying to audit services or audit remediation services offered by accounting firms or firms other than accounting firms; and</P>
                            <P>(ii) For subsequent contract actions after contract award, whether there has been any change with regard to previously reported disciplinary proceedings since the last contract action.</P>
                            <P>
                                (e) 
                                <E T="03">Solicitation provisions and contract clauses.</E>
                                 (1) Use the provision at 252.237-7000, Notice of Special Standards of Responsibility, in solicitations for audit services.
                            </P>
                            <P>(2) Use the clause at 252.237-7001, Compliance with Audit Standards, in solicitations and contracts for audit services.</P>
                            <P>(3) Use the provision at 252.237-7025, Preaward Transparency Requirements for Firms Offering to Support Department of Defense Audits—Representation and Disclosure, in solicitations, including solicitations using FAR part 12 procedures for the acquisition of commercial products and commercial services, that include the clause at 252.237-7026, Postaward Transparency Requirements for Firms that Support Department of Defense Audits.</P>
                            <P>(4) Use the clause at 252.237-7026, Postaward Transparency Requirements for Firms that Support Department of Defense Audits, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, that—</P>
                            <P>(i) Exceed the simplified acquisition threshold; and</P>
                            <P>(ii) Are for the acquisition of financial statement auditing or audit remediation services as described in paragraph (d)(2) of this section.</P>
                            <CITA>[70 FR 57193, Sept. 30, 2005, as amended at 84 FR 50789, Sept. 26, 2019; 87 FR 65501, Oct. 28, 2022; 88 FR 6588, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 237.5—Management Oversight of Service Contracts</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>75 FR 54525, Sept. 8, 2010, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>237.503</SECTNO>
                            <SUBJECT>Agency-head responsibilities.</SUBJECT>
                            <P>(c) The agency head or designee shall employ procedures to ensure that requirements for service contracts are vetted and approved as a safeguard to prevent contracts from being awarded or administered in a manner that constitutes an unauthorized personal services contract. Contracting officers shall follow the procedures at PGI 237.503, include substantially similar certifications in conjunction with service contract requirements, and place the certification in the contract file. The program manager or other official responsible for the requirement, at a level specified by the agency, should execute the certification. In addition, contracting officers and program managers should remain aware of the descriptive elements at FAR 37.104(d) to ensure that a service contract does not inadvertently become administered as a personal-services contract.</P>
                            <CITA>[76 FR 25566, May 5, 2011]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 237.70—Mortuary Services</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>71 FR 3416, Jan. 23, 2006, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <PRTPAGE P="361"/>
                            <SECTNO>237.7000</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>This subpart—</P>
                            <P>(a) Applies to contracts for mortuary services (the care of remains) for military personnel within the United States; and</P>
                            <P>(b) May be used as guidance in areas outside the United States for mortuary services for deceased military and civilian personnel.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.7001</SECTNO>
                            <SUBJECT>Method of acquisition.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Requirements type contract.</E>
                                 By agreement among the military activities, one activity in each geographical area will contract for the estimated requirements for the care of remains for all military activities in the area. Use a requirements type contract (see FAR 16.503) when the estimated annual requirements for the activities in the area are ten or more.
                            </P>
                            <P>
                                (b) 
                                <E T="03">Purchase order.</E>
                                 Where no contract exists, use DD Form 1155, Order for Supplies or Services, to obtain mortuary services.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.7002</SECTNO>
                            <SUBJECT>Area of performance and distribution of contracts.</SUBJECT>
                            <P>Follow the procedures at PGI 237.7002 for—</P>
                            <P>(a) Defining the geographical area to be covered by the contract; and</P>
                            <P>(b) Distributing copies of the contract.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.7003</SECTNO>
                            <SUBJECT>Solicitation provisions and contract clauses.</SUBJECT>
                            <P>(a) Use the following clauses in all mortuary service solicitations and contracts, except do not use the clauses at 252.237-7004, Area of Performance, in solicitations or contracts that include port of entry requirements:</P>
                            <P>(1) 252.237-7003, Requirements, (insert activities authorized to place orders in paragraph (e) of the clause).</P>
                            <P>(2) 252.237-7004, Area of Performance.</P>
                            <P>(3) 252.237-7005, Performance and Delivery.</P>
                            <P>(4) 252.237-7006, Subcontracting.</P>
                            <P>(5) 252.237-7007, Termination for Default.</P>
                            <P>(6) 252.237-7008, Group Interment.</P>
                            <P>(7) 252.237-7009, Permits.</P>
                            <P>(8) 252.237-7011, Preparation History.</P>
                            <P>(b) Use the clause at FAR 52.245-1, Government Property, with its Alternate I, in solicitations and contracts that include port of entry requirements.</P>
                            <CITA>[71 FR 3416, Jan. 23, 2006, as amended at 74 FR 37646, July 29, 2009; 79 FR 65593, Nov. 5, 2014; 84 FR 48505, Sept. 13, 2019]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 237.71—Laundry and Dry Cleaning Services</HD>
                        <SECTION>
                            <SECTNO>237.7100</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>This subpart—</P>
                            <P>(a) Applies to contracts for laundry and dry cleaning services within the United States; and</P>
                            <P>(b) May be used as guidance in areas outside the United States.</P>
                            <CITA>[71 FR 3416, Jan. 23, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.7101</SECTNO>
                            <SUBJECT>Solicitation provisions and contract clauses.</SUBJECT>
                            <P>(a) Use the provision at 252.237-7012, Instruction to Offerors (Count-of-Articles), in solicitations for laundry and dry cleaning services to be provided on a count-of-articles basis.</P>
                            <P>(b) Use the provision at 252.237-7013, Instruction to Offerors (Bulk Weight), in solicitations for laundry services to be provided on a bulk weight basis.</P>
                            <P>(c) Use the clause at 252.237-7014, Loss or Damage (Count-of-Articles), in solicitations and contracts for laundry and dry cleaning services to be provided on a count-of-articles basis.</P>
                            <P>(d) Use the clause at 252.237-7015, Loss or Damage (Weight of Articles), in solicitations and contracts for laundry and dry cleaning services to be provided on a bulk weight basis.</P>
                            <P>(1) Insert a reasonable per pound price in paragraph (b) of the clause, based on the average per pound value. When the contract requires laundry services on a bag type basis, insert reasonable per pound prices by bag type.</P>
                            <P>(2) Insert an appropriate percentage in paragraph (e) of the clause, not to exceed eight percent.</P>
                            <P>(e) Use the basic or an alternate of the clause at 252.237-7016, Delivery Tickets, in all solicitations and contracts for laundry and dry cleaning services.</P>
                            <P>
                                (1) Use the basic clause when services are not to be provided on a bulk weight basis.
                                <PRTPAGE P="362"/>
                            </P>
                            <P>(2) Use the alternate I clause when services are for bag type laundry to be provided on a bulk weight basis.</P>
                            <P>(3) Use the alternate II clause when services are unsorted laundry to be provided on a bulk weight basis.</P>
                            <P>(f) Use the clause at 252.237-7017, Individual Laundry, in solicitations and contracts for laundry and dry cleaning services to be provided to individual personnel.</P>
                            <P>(1) Insert the number of pieces of outer garments in paragraphs (d) (1) and (2) of the clause.</P>
                            <P>(2) The number of pieces and composition of a bundle in paragraphs (d) (1) and (2) of the clause may be modified to meet local conditions.</P>
                            <P>(g) Use the clause at 252.237-7018, Special Definitions of Government Property, in all solicitations and contracts for laundry and dry cleaning services.</P>
                            <CITA>[56 FR 36424, July 31, 1991, as amended at 62 FR 34127, June 24, 1997. Redesignated at 71 FR 3416, Jan. 23, 2006; 79 FR 65593, Nov. 5, 2014]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 237.72—Educational Service Agreements</HD>
                        <SECTION>
                            <SECTNO>237.7200</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>(a) This subpart prescribes acquisition procedures for educational services from schools, colleges, universities, or other educational institutions. This subpart does not include tuition assistance agreements, i.e., payment by the Government of partial tuition under the off-duty educational program.</P>
                            <P>(b) As used in the subpart—</P>
                            <P>
                                (1) “
                                <E T="03">Facilities</E>
                                ” do not include the institution's dining rooms or dormitories; and
                            </P>
                            <P>
                                (2) “
                                <E T="03">Fees</E>
                                ” does not include charges for meals or lodging.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.7201</SECTNO>
                            <SUBJECT>Educational service agreement.</SUBJECT>
                            <P>(a) An educational service agreement is not a contract, but is an ordering agreement under which the Government may order educational services.</P>
                            <P>(b) Educational service agreements provide for ordering educational services when—</P>
                            <P>(1) The Government pays normal tuition and fees for educational services provided to a student by the institution under its normal schedule of tuition and fees applicable to all students generally; and</P>
                            <P>(2) Enrollment is at the institution under the institution's normal rules and in courses and curricula which the institution offers to all students meeting admission requirements.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.7202</SECTNO>
                            <SUBJECT>Limitations.</SUBJECT>
                            <P>Educational service agreements are not used to provide special courses or special fees for Government students.</P>
                            <CITA>[56 FR 36424, July 31, 1991, as amended at 83 FR 16005, Apr. 13, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.7203</SECTNO>
                            <SUBJECT>Duration.</SUBJECT>
                            <P>(a) Educational service agreements are for an indefinite duration and remain in effect until terminated.</P>
                            <P>(b) The issuing activity must establish procedures to review each educational service agreement at least once each year. Review dates should consider the institution's academic calendar and occur at least 30 days before the beginning of a term. The purpose of the review is to incorporate changes to reflect requirements of any statute, Executive Order, FAR, or DFARS.</P>
                            <P>(c) If the contracting officer and the institution do not agree on required changes, terminate the agreement.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.7204</SECTNO>
                            <SUBJECT>Format and clauses for educational service agreements.</SUBJECT>
                            <P>Educational service agreements under this subpart shall be in the following format. Add to the schedule any other provisions necessary to describe the requirements, if they are consistent with the following provisions and the policy of acquiring educational services in the form of standard course offerings at the prevailing rates of the institution.</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Educational Service Agreement</HD>
                                <HD SOURCE="HD3">Agreement No. ____________</HD>
                                <P>
                                    1. This agreement entered into on the ________ day of __________ ________, is between the Government, represented by the Contracting Officer, and the Contractor, (name of institution), an educational institution located in ________ (city), ________ (state).
                                    <PRTPAGE P="363"/>
                                </P>
                                <P>2. This agreement is for educational services to be provided by the Contractor to Government personnel at the Contractor's institution. The Contractor shall provide instruction with standard offerings of courses available to the public.</P>
                                <P>3. The Government shall pay for services under the Contractor's normal schedule of tuition and fees applicable to the public and in effect at the time the services are performed.</P>
                                <P>4. The Government will review this agreement annually before the anniversary of its effective date for the purpose of incorporating changes required by statutes, executive orders, the Federal Acquisition Regulation, or the Defense Federal Acquisition Regulation Supplement. Changes required to be made by modification to this agreement or by issuance of a superseding agreement. If mutual agreement on the changes cannot be reached, the Government will terminate this agreement.</P>
                                <P>5. The parties may amend this agreement only by mutual consent.</P>
                                <P>6. This agreement shall start on the date in paragraph 1 and shall continue until terminated.</P>
                                <P>7. The estimated annual cost of this agreement is $__________. This estimate is for administrative purposes only and does not impose any obligation on the Government to request any services or make any payment.</P>
                                <P>8. Advance payments are authorized by 10 U.S.C. 2396(a)(3).</P>
                                <P>9. Submit invoices to: ____________ (name and address of activity).</P>
                                <HD SOURCE="HD1">Schedule Provisions</HD>
                                <P>
                                    1. 
                                    <E T="03">Ordering procedures and services to be provided.</E>
                                     (a) The Contractor shall promptly deliver to the Contracting Officer one copy of each catalog applicable to this agreement, and one copy of any subsequent revision.
                                </P>
                                <P>(b) The Government will request educational services under this agreement by a (insert type of request, such as, delivery order, official Government order, or other written communication). The (insert type of request, such as, delivery order, official Government order, or other written communication) will contain the number of this agreement and will designate as students at the Contractor's institution one or more Government-selected persons who have already been accepted for admission under the Contractor's usual admission standards.</P>
                                <P>(c) All students under this agreement shall register in the same manner, be subject to the same academic regulations, and have the same privileges, including the use of all facilities and equipment as any other students enrolled in the institution.</P>
                                <P>(d) Upon enrolling each student under this agreement, the Contractor shall, where the resident or nonresident status involves a difference in tuition or fees—</P>
                                <P>(i) Determine the resident or nonresident status of the student;</P>
                                <P>(ii) Notify the student and the Contracting Officer of the determination. If there is an appeal of the determination;</P>
                                <P>(iii) If there is an appeal of the determination, process the appeal under the Contractor's standard procedures;</P>
                                <P>(iv) Notify the student and Contracting Officer of the result; and</P>
                                <P>(v) Make the determination a part of the student's permanent record.</P>
                                <P>(e) The Contractor shall not furnish any instruction or other services to any student under this agreement before the effective date of a request for services in the form specified in paragraph (b) of this schedule.</P>
                                <P>
                                    2. 
                                    <E T="03">Change in curriculum.</E>
                                     The Contracting Officer may vary the curriculum for any student enrolled under this agreement but shall not require or make any change in any course without the Contractor's consent.
                                </P>
                                <P>
                                    3. 
                                    <E T="03">Payment.</E>
                                     (a) The Government shall pay the Contractor the normal tuition and fees which the Contractor charges any students pursuing the same or similar curricula, except for any tuition and fees which this agreement excludes. The Contractor may change any tuition and fees, provided—
                                </P>
                                <P>(1) The Contractor publishes the revisions in a catalog or otherwise publicly announces the revisions;</P>
                                <P>(2) Applies the revisions uniformly to all students studying the same or similar curricula;</P>
                                <P>(3) Provides the Contracting Officer notice of changes before their effective date.</P>
                                <P>(b) The Contractor shall not establish any tuition or fees which apply solely to students under this agreement.</P>
                                <P>(c) If the Contractor regularly charges higher tuition and fees for nonresident students, the Contractor may charge the Government the normal nonresident tuition and fees for students under this agreement who are nonresidents. The Government shall not claim resident tuition and fees for any student solely on the basis of the student residing in the State as a consequence of enrollment under this agreement.</P>
                                <P>(d) The Contractor shall charge the Government only the tuition and fees which relate directly to enrollment as a student. Tuition and fees may include—</P>
                                <P>(i) Penalty fees for late registration or change of course caused by the Government;</P>
                                <P>(ii) Mandatory health fees and health insurance charges; and</P>
                                <P>(iii) Any flat rate charge applicable to all students registered for research that appears in the Contractor's publicly announced fee schedule.</P>
                                <P>(e) The Contractor shall not charge the Government for—</P>
                                <P>
                                    (i) Permit charges, such as vehicle registration or parking fees, unless specifically authorized in the request for service; and
                                    <PRTPAGE P="364"/>
                                </P>
                                <P>(ii) Any equipment, refundable deposits, or any items or services (such as computer time) related to student research.</P>
                                <P>(f) Normally, the Contractor shall not directly charge individual students for application fees or any other fee chargeable to this agreement. However, if the Contractor's standard procedures require payment of any fee before the student is enrolled under this agreement, the Contractor may charge the student. When the Contractor receives payment from the Government, the Contractor shall fully reimburse the student.</P>
                                <P>(g) For each term the Contractor enrolls students under this agreement, the Contractor shall submit ________ copies of an invoice listing charges for each student separately. The Contractor shall submit invoices within ________ days after the start of the term and shall include—</P>
                                <P>(i) Agreement number and inclusive dates of the term;</P>
                                <P>(ii) Name of each student;</P>
                                <P>(iii) A list showing each course for each student if the school charges by credit hour;</P>
                                <P>(iv) The resident or nonresident status of each student (if applicable to the Contractor's school); and</P>
                                <P>(v) A breakdown of charges for each student, including credit hours, tuition, application fee, and other fees. Provide a total for each student and a grand total for all students listed on the invoice.</P>
                                <P>(h) If unforeseen events require additional charges that are otherwise payable under the Contractor's normal tuition and fee schedule, the Contractor may submit a supplemental invoice or make the adjustment on the next regular invoice under this agreement. The Contractor shall clearly identify and explain the supplemental invoice or the adjustment.</P>
                                <P>(i) The Contractor shall apply any credits resulting from withdrawal of students, or from any other cause under its standard procedures, to subsequent invoices submitted under this agreement. Credits should appear on the first invoice submitted after the action resulting in the credits. If no subsequent invoice is submitted, the Contractor shall deliver to the Contracting Officer a check drawn to the order of the office designated for contract administration. The Contractor shall identify the reason for the credit and the applicable term dates in all cases.</P>
                                <P>
                                    4. 
                                    <E T="03">Withdrawal of students.</E>
                                     (a) The Government may, at its option and at any time, withdraw financial support for any student by issuing official orders. The Government will furnish ________ copies of the orders to the Contractor within a reasonable time after publication.
                                </P>
                                <P>(b) The Contractor may request withdrawal by the Government of any student for academic or disciplinary reasons.</P>
                                <P>(c) If withdrawal occurs before the end of a term, the Government will pay any tuition and fees due for the current term. The Contractor shall credit the Government with any charges eligible for refund under the Contractor's standard procedures for any students in effect on the date of withdrawal.</P>
                                <P>(d) Withdrawal of students by the Government will not be the basis for any special charge or claim by the Contractor other than charges under the Contractor's standard procedures.</P>
                                <P>
                                    5. 
                                    <E T="03">Transcripts.</E>
                                     Within a reasonable time after withdrawal of a student for any reason, or after graduation, the Contractor shall send to the Contracting Officer (or to an address supplied by the Contracting Officer) one copy of an official transcript showing all work by the student at the institution until such withdrawal or graduation.
                                </P>
                                <P>
                                    6. 
                                    <E T="03">Student teaching.</E>
                                     The Government does not anticipate the Contractor awarding fellowships and assistantships to students attending school under this agreement. However, for graduate students, should both the student and the Contractor decide it to be in the student's best interests to assist in the institution's teaching program, the Contractor may provide nominal compensation for part-time service. Base the compensation on the Contractor's practices and procedures for other students of similar accomplishment in that department or field. The Contractor shall apply the compensation as a credit against any invoices presented for payment for any period in which the student performed the part-time teaching service.
                                </P>
                                <P>
                                    7. 
                                    <E T="03">Termination of agreement.</E>
                                     (a) Either party may terminate this agreement by giving 30 days advance written notice of the effective date of termination. In the event of termination, the Government shall have the right, at its option, to continue to receive educational services for those students already enrolled in the contractor's institution under this agreement until such time that the students complete their courses or curricula or the Government withdraws them from the Contractor's institution. The terms and conditions of this agreement in effect on the effective date of the termination shall continue to apply to such students remaining in the Contractor's institution.
                                </P>
                                <P>(b) Withdrawal of students under Schedule provision 4 shall not be considered a termination within the meaning of this provision 7.</P>
                                <P>(c) Termination by either party shall not be the basis for any special charge or claim by the Contractor, other than as provided by the Contractor's standard procedures.</P>
                                <HD SOURCE="HD1">General Provisions</HD>
                                <P>Use the following clauses in educational service agreements:</P>
                                <P>
                                    1. FAR 52.202-1, Definitions, and add the following paragraphs (h) through (m).
                                    <PRTPAGE P="365"/>
                                </P>
                                <P>(h) “Term” means the period of time into which the Contractor divides the academic year for purposes of instruction. This includes “semester,” “trimester,” “quarter,” or any similar word the Contractor may use.</P>
                                <P>(i) “Course” means a series of lectures or instructions, and laboratory periods, relating to one specific representation of subject matter, such as Elementary College Algebra, German 401, or Surveying. Normally, a student completes a course in one term and receives a certain number of semester hours credit (or equivalent) upon successful completion.</P>
                                <P>(j) “Curriculum” means a series of courses having a unified purpose and belonging primarily to one major academic field. It will usually include certain required courses and elective courses within established criteria. Examples include Business Administration, Civil Engineering, Fine and Applied Arts, and Physics. A curriculum normally covers more than one term and leads to a degree or diploma upon successful completion.</P>
                                <P>(k) “Catalog” means any medium by which the Contractor publicly announces terms and conditions for enrollment in the Contractor's institution, including tuition and fees to be charged. This includes “bulletin,” “announcement,” or any other similar word the Contractor may use.</P>
                                <P>(l) “Tuition” means the amount of money charged by an educational institution for instruction, not including fees.</P>
                                <P>(m) “Fees” means those applicable charges directly related to enrollment in the Contractor's institution. Unless specifically allowed in the request for services, fees shall not include—</P>
                                <P>(1) Any permit charge, such as parking and vehicle registration; or</P>
                                <P>(2) Charges for services of a personal nature, such as food, housing, and laundry.</P>
                                <P>2. FAR 52.203-3, Gratuities.</P>
                                <P>3. FAR 52.203-5, Covenant Against Contingent Fees.</P>
                                <P>4. FAR 52.204-1, Approval of Contract, if required by department/agency procedures.</P>
                                <P>5. FAR 52.215-2, Audit and Records—Negotiation.</P>
                                <P>6. FAR 52.215-8, Order of Precedence—Uniform Contract Format.</P>
                                <P>7. Conflicts Between Agreement and Catalog. Insert the following clause:</P>
                                <HD SOURCE="HD1">Conflicts Between Agreement and Catalog</HD>
                                <P>If there is any inconsistency between this agreement and any catalog or other document incorporated in this agreement by reference or any of the Contractor's rules and regulations, the provisions of this agreement shall govern.</P>
                                <P>8. FAR 52.222-3, Convict Labor.</P>
                                <P>9. Under FAR 22.802, FAR 22.807, and FAR 22.810, use the appropriate clause from FAR 52.222-26, Equal Opportunity.</P>
                                <P>10. FAR 52.233-1, Disputes.</P>
                                <P>11. Assignment of Claims. Insert the following clause:</P>
                                <HD SOURCE="HD1">Assignment of Claims</HD>
                                <P>No claim under this agreement shall be assigned.</P>
                                <P>12. FAR 52.252-4, Alterations in Contract, if required by department/agency procedures.</P>
                                <HD SOURCE="HD1">Signature Page</HD>
                                <FP SOURCE="FP-DASH">Agreement No.</FP>
                                <FP SOURCE="FP-DASH">Date</FP>
                                <FP>The United States of America</FP>
                                <FP SOURCE="FP-DASH">By:</FP>
                                <FP>  (Contracting Officer)</FP>
                                <FP SOURCE="FP-DASH">Activity</FP>
                                <FP SOURCE="FP-DASH">Location</FP>
                                <FP>    (Name of Contractor)</FP>
                                <FP SOURCE="FP-DASH">By:</FP>
                                <FP SOURCE="FP-DASH">(Title)</FP>
                            </EXTRACT>
                            <CITA>[56 FR 36424, July 31, 1991, as amended at 60 FR 61599, Nov. 30, 1995; 63 FR 55052, Oct. 14, 1998; 64 FR 49684, Sept. 14, 1999; 64 FR 53447, Oct. 1, 1999; 74 FR 42780, Aug. 25, 2009]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 237.73—Services of Students at Research and Development Laboratories</HD>
                        <SECTION>
                            <SECTNO>237.7300</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>This subpart prescribes procedures for acquisition of temporary or intermittent services of students at institutions of higher learning for the purpose of providing technical support at Defense research and development laboratories (10 U.S.C. 4143).</P>
                            <CITA>[56 FR 36284, July 31, 1991, as amended at 87 FR 76995, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.7301</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this subpart—</P>
                            <P>
                                (a) 
                                <E T="03">Institution of higher learning</E>
                                 means any public or private post-secondary school, junior college, college, university, or other degree granting educational institution that—
                            </P>
                            <P>(1) Is located in the United States or its outlying areas;</P>
                            <P>(2) Has an accredited education program approved by an appropriate accrediting body; and</P>
                            <P>(3) Offers a program of study at any level beyond high school.</P>
                            <P>
                                (b) 
                                <E T="03">Nonprofit organization</E>
                                 means any organization described by section 501(c)(3) of title 26 of the U.S.C. which is exempt from taxation under section 501(a) of title 26.
                                <PRTPAGE P="366"/>
                            </P>
                            <P>
                                (c) 
                                <E T="03">Student</E>
                                 means an individual enrolled (or accepted for enrollment) at an institution of higher learning before the term of the student technical support contract. The individual shall remain in good standing in a curriculum designed to lead to the granting of a recognized degree, during the term of the contract.
                            </P>
                            <P>
                                (d) 
                                <E T="03">Technical support</E>
                                 means any scientific or engineering work in support of the mission of the DoD laboratory involved. It does not include administrative or clerical services.
                            </P>
                            <CITA>[56 FR 36424, July 31, 1991, as amended at 70 FR 35545, June 21, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.7302</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>Generally, agencies will acquire services of students at institutions of higher learning by contract between a nonprofit organization employing the student and the Government. When it is in the best interest of the Government, contracts may be made directly with students. These services are not subject to the requirements of FAR part 19, FAR 13.003(b)(1), or DFARS part 219. Award authority for these contracts is 10 U.S.C. 3204(a) and 10 U.S.C. 4143.</P>
                            <CITA>[56 FR 36424, July 31, 1991, as amended at 60 FR 29500, June 5, 1995; 64 FR 2598, Jan. 15, 1999; 87 FR 76995, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.7303</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>Contracts made directly with students are nonpersonal service contracts but shall include the clauses at FAR 52.232-3, Payments Under Personal Services Contracts, and FAR 52.249-12, Termination (Personal Services).</P>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 237.74—Services at Installations Being Closed</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>59 FR 36089, July 15, 1994, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>237.7400</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>This subpart prescribes procedures for contracting, through use of other than full and open competition, with local governments for police, fire protection, airfield operation, or other community services at military installations to be closed under the Defense Authorization Amendments and Base Closure and Realignment Act (Pub. L. 100-526), as amended, and the Defense Base Closure and Realignment Act of 1990 (Pub. L. 101-510), as amended.</P>
                            <CITA>[59 FR 36089, July 15, 1994, as amended at 60 FR 29500, June 5, 1995]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.7401</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>The authority in 206.302-5(b)(ii) to contract with local governments—</P>
                            <P>(a) May be exercised without regard to the provisions of 10 U.S.C. Chapter 146, Contracting for Performance of Civilian Commercial or Industrial Type Functions;</P>
                            <P>(b) May not be exercised earlier than 180 days before the date the installation is scheduled to be closed;</P>
                            <P>(c) Requires a determination by the head of the contracting activity that the services being acquired under contract with the local government are in the best interests of the Department of Defense.</P>
                            <CITA>[59 FR 36089, July 15, 1994, as amended at 60 FR 29500, June 5, 1995; 83 FR 24894, May 30, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.7402</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at 252.237-7022, Services at Installations Being Closed, in solicitations and contracts based upon the authority of this subpart.</P>
                            <CITA>[59 FR 36089, July 15, 1994, as amended at 60 FR 29500, June 5, 1995]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 237.75—Acquisition and Management of Industrial Resources</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>74 FR 37646, July 29, 2009, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>237.7501</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <P>
                                <E T="03">Facilities project,</E>
                                 as used in this subpart, means a Government project to provide, modernize, or replace real property for use by a contractor in performing a Government contract or subcontract.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.7502</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(a) Comply with DoD Directive 4275.5, Acquisition and Management of Industrial Resources, in processing requests for facilities projects.</P>
                            <P>
                                (b) Departments and agencies shall submit reports of facilities projects to 
                                <PRTPAGE P="367"/>
                                the House and Senate Armed Services Committees—
                            </P>
                            <P>(1) At least 30 days before starting facilities projects involving real property (10 U.S.C. 2662); and</P>
                            <P>(2) In advance of starting construction for a facilities project regardless of cost. Use DD Form 1391, FY____ Military Construction Project Data, to notify congressional committees of projects that are not included in the annual budget.</P>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 237.76—Continuation of Essential Contractor Services</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>75 FR 66682, Oct. 29, 2010, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>237.7600</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>This subpart prescribes procedures for the acquisition of essential contractor services which support mission-essential functions.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.7601</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>
                                As used in this subpart, 
                                <E T="03">essential contractor service</E>
                                 and 
                                <E T="03">mission-essential functions</E>
                                 are defined in the clause at 252.237-7023, Continuation of Essential Contractor Services.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.7602</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(a) Contractors providing services designated as essential contractor services shall be prepared to continue providing such services, in accordance with the terms and conditions of their contracts, during periods of crisis. As a general rule, the designation of services as essential contractor services will not apply to an entire contract but will apply only to those service functions that have been specifically identified as essential contractor services by the functional commander or civilian equivalent.</P>
                            <P>(b) Contractors who provide Government-determined essential contractor services shall provide a written plan to be incorporated in the contract, to ensure the continuation of these services in crisis situations. Contracting officers shall consult with a functional manager to assess the sufficiency of the contractor-provided written plan. Contractors will activate such plans only during periods of crisis, as authorized by the contracting officer, who does so at the direction of the appropriate functional commander or civilian equivalent.</P>
                            <P>(c) The contracting officer shall follow the procedures at PGI 207.105U(b)(20)(C) in preparing an acquisition plan.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.7603</SECTNO>
                            <SUBJECT>Solicitation provision and contract clause.</SUBJECT>
                            <P>(a) Use the clause at 252.237-7023, Continuation of Essential Contractor Services in all solicitations and contracts for services that are in support of mission-essential functions.</P>
                            <P>(b) Use the provision at 252.237-7024, Notice of Continuation of Essential Contractor Services in all solicitations for services that include the clause 252.237-7023.</P>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 237.77—Competition for Religious-Related Services</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>83 FR 16002, Apr. 13, 2018, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>237.7700</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>This subpart provides policy and guidance for the acquisition of religious-related services to be performed on a U.S. military installation in accordance with section 898 of the National Defense Authorization Act for Fiscal Year 2016 (Pub. L. 114-92).</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.7701</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <P>As used in this subpart—</P>
                            <P>
                                <E T="03">Nonprofit organization</E>
                                 means any organization that is—
                            </P>
                            <P>(1) Described in section 501(c) of the Internal Revenue Code of 1986; and</P>
                            <P>(2) Exempt from tax under section 501(a) of that Code.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.7702</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(a) A nonprofit organization shall not be precluded from competing for a contract for religious-related services to be performed on a U.S. military installation.</P>
                            <P>(b) See 219.270 when an acquisition for religious-related services to be performed on a U.S. military installation is set aside for any of the small business concerns identified in FAR 19.000(a)(3).</P>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <PRTPAGE P="368"/>
                        <HD SOURCE="HED">Subpart 237.78—Transfer and Adoption of Military Animals</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>89 FR 11747, Feb. 15, 2024, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>237.7800</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>This subpart implements 10 U.S.C. 2387, which requires, under certain circumstances, the transfer of a contract working dog to the Department of Air Force, 341st Training Squadron, for veterinary screening and care in accordance with 10 U.S.C. 2583.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.7801</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <P>As used in this subpart—</P>
                            <P>
                                <E T="03">Contract working dog</E>
                                 means a dog that—
                            </P>
                            <P>(1) Performs a service for DoD pursuant to a contract; and</P>
                            <P>(2) Is trained and kenneled by an entity that provides such a dog pursuant to such a contract.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.7802</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(a) In accordance with 10 U.S.C. 2387, DoD will transfer a contract working dog to the Department of the Air Force, 341st Training Squadron, for veterinary screening and care after the service life of the dog has terminated.</P>
                            <P>(b) The service life of a contract working dog may be terminated if—</P>
                            <P>(1) The final contractual obligation of the dog preceding transfer is with DoD; and</P>
                            <P>(2) The dog cannot be used by another department or agency of the Federal Government due to age, injury, or performance.</P>
                            <P>(c) A contract working dog that has reached the end of its service life will be transferred for care, reclassification as a military animal, and placement for adoption in accordance with 10 U.S.C. 2583.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.7803</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>Contracting officers, at the request of the requiring activity, may issue a determination that the service life of a contract working dog has terminated if the conditions in 237.7802(b) have been documented by the requiring activity.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>237.7804</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at 252.237-7027, Transfer and Adoption of Military Animals, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, that require the services of a contract working dog.</P>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 239</EAR>
                    <HD SOURCE="HED">PART 239—ACQUISITION OF INFORMATION TECHNOLOGY</HD>
                    <CONTENTS>
                        <SECHD>Sec.</SECHD>
                        <SECTNO>239.001</SECTNO>
                        <SUBJECT>Applicability.</SUBJECT>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 239.1—General</HD>
                            <SECTNO>239.101</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 239.70—Exchange or Sale of Information Technology</HD>
                            <SECTNO>239.7001</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 239.71—Security and Privacy for Computer Systems</HD>
                            <SECTNO>239.7100</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>239.7101</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <SECTNO>239.7102</SECTNO>
                            <SUBJECT>Policy and responsibilities.</SUBJECT>
                            <SECTNO>239.7102-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>239.7102-2</SECTNO>
                            <SUBJECT>Compromising emanations—TEMPEST or other standard.</SUBJECT>
                            <SECTNO>239.7102-3</SECTNO>
                            <SUBJECT>Information assurance contractor training and certification.</SUBJECT>
                            <SECTNO>239.7103</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 239.72—Standards</HD>
                            <SECTNO>239.7201</SECTNO>
                            <SUBJECT>Solicitation requirements.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 239.73—Requirements for Information Relating to Supply Chain Risk</HD>
                            <SECTNO>239.7300</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>239.7301</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>239.7302</SECTNO>
                            <SUBJECT>Applicability.</SUBJECT>
                            <SECTNO>239.7303</SECTNO>
                            <SUBJECT>Authorized individuals.</SUBJECT>
                            <SECTNO>239.7304</SECTNO>
                            <SUBJECT>Determination and notification.</SUBJECT>
                            <SECTNO>239.7305</SECTNO>
                            <SUBJECT>Exclusion and limitation on disclosure.</SUBJECT>
                            <SECTNO>239.7306</SECTNO>
                            <SUBJECT>Solicitation provision and contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 239.74—Telecommunications Services</HD>
                            <SECTNO>239.7400</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>239.7401</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>239.7402</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>239.7403-239.7404</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>239.7405</SECTNO>
                            <SUBJECT>
                                Delegated authority for telecommunications resources.
                                <PRTPAGE P="369"/>
                            </SUBJECT>
                            <SECTNO>239.7406</SECTNO>
                            <SUBJECT>Certified cost or pricing data and data other than certified cost or pricing data.</SUBJECT>
                            <SECTNO>239.7407</SECTNO>
                            <SUBJECT>Type of contract.</SUBJECT>
                            <SECTNO>239.7408</SECTNO>
                            <SUBJECT>Special construction.</SUBJECT>
                            <SECTNO>239.7408-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>239.7408-2</SECTNO>
                            <SUBJECT>Applicability of construction labor standards for special construction.</SUBJECT>
                            <SECTNO>239.7409</SECTNO>
                            <SUBJECT>Special assembly.</SUBJECT>
                            <SECTNO>239.7410</SECTNO>
                            <SUBJECT>Cancellation and termination.</SUBJECT>
                            <SECTNO>239.7411</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 239.76—Cloud Computing</HD>
                            <SECTNO>239.7600</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>239.7601</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>239.7602</SECTNO>
                            <SUBJECT>Policy and responsibilities.</SUBJECT>
                            <SECTNO>239.7602-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>239.7602-2</SECTNO>
                            <SUBJECT>Required storage of data within the United States or outlying areas.</SUBJECT>
                            <SECTNO>239.7603</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>239.7604</SECTNO>
                            <SUBJECT>Solicitation provision and contract clause.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36429, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SECTION>
                        <SECTNO>239.001</SECTNO>
                        <SUBJECT>Applicability.</SUBJECT>
                        <P>Notwithstanding FAR 39.001, this part applies to acquisitions of information technology, including national security systems.</P>
                        <CITA>[80 FR 67251, Oct. 30, 2015]</CITA>
                    </SECTION>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 239.1—General</HD>
                        <SECTION>
                            <SECTNO>239.101</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(1) A contracting officer may not enter into a contract in excess of the simplified acquisition threshold for information technology products or services that are not commercial products or commercial services  unless the head of the contracting activity determines in writing that no commercial items are suitable to meet the agency's needs, as determined through the use of market research appropriate to the circumstances (see FAR 10.001(a)(3)) (section 855 of the National Defense Authorization Act for Fiscal Year 2016 (Pub. L. 114-92)).</P>
                            <P>(2) See subpart 208.74 when acquiring commercial software or software maintenance.</P>
                            <P>(3) See 227.7202 for policy on the acquisition of commercial computer software and commercial computer software documentation.</P>
                            <P>(4) See 227.7203 for policy on the acquisition of other than commercial computer software and other than commercial computer software documentation.</P>
                            <CITA>[83 FR 4445, Jan. 31, 2018, as amended at 88 FR 6588, Jan. 31, 2023; 88 FR 17345, Mar. 22, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 239.70—Exchange or Sale of Information Technology</HD>
                        <SECTION>
                            <SECTNO>239.7001</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>Agencies shall follow the procedures in DoD Manual 4140.01, Volume 9, DoD Supply Chain Materiel Management Procedures: Materiel Programs, when considering the exchange or sale of Government-owned information technology.</P>
                            <CITA>[71 FR 39010, July 11, 2006, as amended at 82 FR 61481, Dec. 28, 2017]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 239.71—Security and Privacy for Computer Systems</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>69 FR 35534, June 25, 2004, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>239.7100</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>This subpart includes information assurance and Privacy Act considerations. Information assurance requirements are in addition to provisions concerning protection of privacy of individuals (see FAR Subpart 24.1).</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>239.7101</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <P>
                                <E T="03">Information assurance</E>
                                , as used in this subpart, means measures that protect and defend information, that is entered, processed, transmitted, stored, retrieved, displayed, or destroyed, and information systems, by ensuring their availability, integrity, authentication, confidentiality, and non-repudiation. This includes providing for the restoration of information systems by incorporating protection, detection, and reaction capabilities.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>239.7102</SECTNO>
                            <SUBJECT>Policy and responsibilities.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>239.7102-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>
                                (a) Agencies shall ensure that information assurance is provided for information technology in accordance with 
                                <PRTPAGE P="370"/>
                                current policies, procedures, and statutes, to include—
                            </P>
                            <P>(1) The National Security Act;</P>
                            <P>(2) The Clinger-Cohen Act;</P>
                            <P>(3) National Security Telecommunications and Information Systems Security Policy No. 11;</P>
                            <P>(4) Federal Information Processing Standards;</P>
                            <P>(5) DoD Directive 8500.1, Information Assurance;</P>
                            <P>(6) DoD Instruction 8500.2, Information Assurance Implementation;</P>
                            <P>(7) DoD Directive 8140.01, Cyberspace Workforce Management; and</P>
                            <P>(8) DoD Manual 8570.01-M, Information Assurance Workforce Improvement Program.</P>
                            <P>(b) For all acquisitions, the requiring activity is responsible for providing to the contracting officer—</P>
                            <P>(1) Statements of work, specifications, or statements of objectives that meet information assurance requirements as specified in paragraph (a) of this subsection;</P>
                            <P>(2) Inspection and acceptance contract requirements; and</P>
                            <P>(3) A determination as to whether the information technology requires protection against compromising emanations.</P>
                            <CITA>[69 FR 35534, June 25, 2004, as amended at 73 FR 1829, Jan. 10, 2008; 75 FR 34946, June 21, 2010; 80 FR 56930, Sept. 21, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>239.7102-2</SECTNO>
                            <SUBJECT>Compromising emanations—TEMPEST or other standard.</SUBJECT>
                            <P>For acquisitions requiring information assurance against compromising emanations, the requiring activity is responsible for providing to the contracting officer—</P>
                            <P>
                                (a) The required protections, 
                                <E T="03">i.e.,</E>
                                 an established National TEMPEST standard (e.g., NSTISSAM TEMPEST 1-92) or a standard used by other authority;
                            </P>
                            <P>(b) The required identification markings to include markings for TEMPEST or other standard, certified equipment (especially if to be reused);</P>
                            <P>(c) Inspection and acceptance requirements addressing the validation of compliance with TEMPEST or other standards; and</P>
                            <P>(d) A date through which the accreditation is considered current for purposes of the proposed contract.</P>
                            <CITA>[69 FR 35534, June 25, 2004, as amended at 84 FR 58337, Oct. 31, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>239.7102-3</SECTNO>
                            <SUBJECT>Information assurance contractor training and certification.</SUBJECT>
                            <P>(a) For acquisitions that include information assurance functional services for DoD information systems, or that require any appropriately cleared contractor personnel to access a DoD information system to perform contract duties, the requiring activity is responsible for providing to the contracting officer—(1) A list of information assurance functional responsibilities for DoD information systems by category (e.g., technical or management) and level (e.g., computing environment, network environment, or enclave); and</P>
                            <P>(2) The information assurance training, certification, certification maintenance, and continuing education or sustainment training required for the information assurance functional responsibilities.</P>
                            <P>(b) After contract award, the requiring activity is responsible for ensuring that the certifications and certification status of all contractor personnel performing information assurance functions as described in DoD 8570.01-M, Information Assurance Workforce Improvement Program, are in compliance with the manual and are identified, documented, and tracked.</P>
                            <P>(c) The responsibilities specified in paragraphs (a) and (b) of this section apply to all DoD information assurance duties supported by a contractor, whether performed full-time or part-time as additional or embedded duties, and when using a DoD contract, or a contract or agreement administered by another agency (e.g., under an interagency agreement).</P>
                            <P>(d) See PGI 239.7102-3 for guidance on documenting and tracking certification status of contractor personnel, and for additional information regarding the requirements of DoD 8570.01-M.</P>
                            <CITA>[73 FR 1829, Jan. 10, 2008]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="371"/>
                            <SECTNO>239.7103</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>(a) Use the clause at 252.239-7000, Protection Against Compromising Emanations, in solicitations and contracts involving information technology that requires protection against compromising emanations.</P>
                            <P>(b) Use the clause at 252.239-7001, Information Assurance Contractor Training and Certification, in solicitations and contracts involving contractor performance of information assurance functions as described in DoD 8570.01-M.</P>
                            <CITA>[73 FR 1829, Jan. 10, 2008]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 239.72—Standards</HD>
                        <SECTION>
                            <SECTNO>239.7201</SECTNO>
                            <SUBJECT>Solicitation requirements.</SUBJECT>
                            <P>Contracting officers shall ensure that all applicable Federal Information Processing Standards are incorporated into solicitations.</P>
                            <CITA>[71 FR 39011, July 11, 2006]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 239.73—Requirements for Information Relating to Supply Chain Risk</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>78 FR 69271, Nov. 18, 2013, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>239.7300</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>
                                This subpart implements 10 U.S.C. 3252 and elements of DoD Instruction 5200.44, Protection of Mission Critical Functions to Achieve Trusted Systems and Networks (TSN), at 
                                <E T="03">https://www.esd.whs.mil/Portals/54/Documents/DD/issuances/dodi/520044p.pdf?ver=2018-11-08-075800-903.</E>
                            </P>
                            <CITA>[84 FR 4369, Feb. 15, 2019, as amended at 87 FR 76995, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>239.7301</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this subpart—</P>
                            <P>
                                <E T="03">Covered item of supply</E>
                                 means an item of information technology that is purchased for inclusion in a covered system, and the loss of integrity of which could result in a supply chain risk for a covered system (see 10 U.S.C. 3252).
                            </P>
                            <P>
                                <E T="03">Covered system</E>
                                 means a national security system, as that term is defined at 44 U.S.C. 3552(b) (see 10 U.S.C. 3252). It is any information system, including any telecommunications system, used or operated by an agency or by a contractor of an agency, or other organization on behalf of an agency—
                            </P>
                            <P>(1) The function, operation, or use of which—</P>
                            <P>(i) Involves intelligence activities;</P>
                            <P>(ii) Involves cryptologic activities related to national security;</P>
                            <P>(iii) Involves command and control of military forces;</P>
                            <P>(iv) Involves equipment that is an integral part of a weapon or weapons system; or</P>
                            <P>(v) Is critical to the direct fulfillment of military or intelligence missions but this does not include a system that is to be used for routine administrative and business applications, including payroll, finance, logistics, and personnel management applications; or</P>
                            <P>(2) Is protected at all times by procedures established for information that have been specifically authorized under criteria established by an Executive order or an Act of Congress to be kept classified in the interest of national defense or foreign policy.</P>
                            <P>
                                <E T="03">Information technology</E>
                                 (see 40 U.S.C 11101(6)) means, in lieu of the definition at FAR 2.1, any equipment, or interconnected system(s) or subsystem(s) of equipment, that is used in the automatic acquisition, storage, analysis, evaluation, manipulation, management, movement, control, display, switching, interchange, transmission, or reception of data or information by the agency.
                            </P>
                            <P>(1) For purposes of this definition, equipment is used by an agency if the equipment is used by the agency directly or is used by a contractor under a contract with the agency that requires—</P>
                            <P>(i) Its use; or</P>
                            <P>(ii) To a significant extent, its use in the performance of a service or the furnishing of a product.</P>
                            <P>
                                (2) The term “information technology” includes computers, ancillary equipment (including imaging peripherals, input, output, and storage devices necessary for security and surveillance), peripheral equipment designed to be controlled by the central processing unit of a computer, software, firmware and similar procedures, 
                                <PRTPAGE P="372"/>
                                services (including support services), and related resources.
                            </P>
                            <P>(3) The term “information technology” does not include any equipment acquired by a contractor incidental to a contract.</P>
                            <P>
                                <E T="03">Supply chain risk</E>
                                 means the risk that an adversary may sabotage, maliciously introduce unwanted function, or otherwise subvert the design, integrity, manufacturing, production, distribution, installation, operation, or maintenance of a covered system so as to surveil, deny, disrupt, or otherwise degrade the function, use, or operation of such system (see 10 U.S.C. 3252).
                            </P>
                            <CITA>[78 FR 69271, Nov. 18, 2013. Redesignated and amended at 80 FR 67251, Oct. 30, 2015; 83 FR 15995, Apr. 13, 2018; 84 FR 4369, Feb. 15, 2019; 87 FR 76995, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>239.7302</SECTNO>
                            <SUBJECT>Applicability.</SUBJECT>
                            <P>Notwithstanding FAR 39.001, this subpart shall be applied to acquisition of information technology for covered systems (see 10 U.S.C. 3252), for procurements involving—</P>
                            <P>(a) A source selection for a covered system or a covered item of supply involving either a performance specification (see 10 U.S.C. 3206(a)(3)(B)), or an evaluation factor (see 10 U.S.C. 3206(b)(1)), relating to supply chain risk;</P>
                            <P>(b) The consideration of proposals for and issuance of a task or delivery order for a covered system or a covered item of supply where the task or delivery order contract concerned includes a requirement relating to supply chain risk (see 10 U.S.C. 3406(d)(3) and FAR 16.505(b)(1)(iv)(D)); or</P>
                            <P>(c) Any contract action involving a contract for a covered system or a covered item of supply where such contract includes a requirement relating to supply chain risk.</P>
                            <CITA>[78 FR 69271, Nov. 18, 2013. Redesignated and amended at 80 FR 67251, Oct. 30, 2015; 84 FR 4370, Feb. 15, 2019; 87 FR 76995, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>239.7303</SECTNO>
                            <SUBJECT>Authorized individuals.</SUBJECT>
                            <P>(a) Subject to 239.7304, the following individuals are authorized to take the actions authorized by 239.7305:</P>
                            <P>(1) The Secretary of Defense.</P>
                            <P>(2) The Secretary of the Army.</P>
                            <P>(3) The Secretary of the Navy.</P>
                            <P>(4) The Secretary of the Air Force.</P>
                            <P>(b) The individuals authorized at paragraph (a) may not delegate the authority to take the actions at 239.7305 or the responsibility for making the determination required by 239.7304 to an official below the level of—</P>
                            <P>(1) For the Department of Defense, the Under Secretary of Defense for Acquisition and Sustainment; and,</P>
                            <P>(2) For the military departments, the service acquisition executive for the department concerned.</P>
                            <CITA>[78 FR 69271, Nov. 18, 2013, as amended at 84 FR 4370, Feb. 15, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>239.7304</SECTNO>
                            <SUBJECT>Determination and notification.</SUBJECT>
                            <P>The individuals authorized in 239.7303 may exercise the authority provided in 239.7305 only after—</P>
                            <P>(a) Obtaining a joint recommendation by the Under Secretary of Defense for Acquisition and Sustainment and the Chief Information Officer of the Department of Defense, on the basis of a risk assessment by the Under Secretary of Defense for Intelligence, that there is a significant supply chain risk to a covered system;</P>
                            <P>(b) Making a determination in writing, in unclassified or classified form, with the concurrence of the Under Secretary of Defense for Acquisition and Sustainment, that—</P>
                            <P>(1) Use of the authority in 239.7305(a), (b), or (c) is necessary to protect national security by reducing supply chain risk;</P>
                            <P>(2) Less intrusive measures are not reasonably available to reduce such supply chain risk; and</P>
                            <P>(3) In a case where the individual authorized in 239.7303 plans to limit disclosure of information under 239.7305(d), the risk to national security due to the disclosure of such information outweighs the risk due to not disclosing such information; and</P>
                            <P>(c)(1) Providing a classified or unclassified notice of the determination made under paragraph (b) of this section—</P>
                            <P>
                                (i) In the case of a covered system included in the National Intelligence Program or the Military Intelligence Program, to the Select Committee on Intelligence of the Senate, the Permanent Select Committee on Intelligence of the House of Representatives, and 
                                <PRTPAGE P="373"/>
                                the congressional defense committees; and
                            </P>
                            <P>(ii) In the case of a covered system not otherwise included in paragraph (a) of this section, to the congressional defense committees; and</P>
                            <P>(2) The notice shall include—</P>
                            <P>(i) The following information (see 10 U.S.C. 3204(e)(2)):</P>
                            <P>(A) A description of the agency's needs.</P>
                            <P>(B) An identification of the statutory exception from the requirement to use competitive procedures and a demonstration, based on the proposed contractor's qualifications or the nature of the procurement, of the reasons for using that exception.</P>
                            <P>(C) A determination that the anticipated cost will be fair and reasonable.</P>
                            <P>(D) A description of the market survey conducted or a statement of the reasons a market survey was not conducted.</P>
                            <P>(E) A listing of the sources, if any, that expressed in writing an interest in the procurement.</P>
                            <P>(F) A statement of the actions, if any, the agency may take to remove or overcome any barrier to competition before a subsequent procurement for such needs;</P>
                            <P>(ii) The joint recommendation by the Under Secretary of Defense for Acquisition and Sustainment and the Chief Information Officer of the Department of Defense as specified in paragraph (a) of this section;</P>
                            <P>(iii) A summary of the risk assessment by the Under Secretary of Defense for Intelligence that serves as the basis for the joint recommendation specified in paragraph (a) of this section; and</P>
                            <P>(iv) A summary of the basis for the determination, including a discussion of less intrusive measures that were considered and why they were not reasonably available to reduce supply chain risk.</P>
                            <CITA>[78 FR 69271, Nov. 18, 2013, as amended at 80 FR 67251, Oct. 30, 2015; 84 FR 4370, Feb. 15, 2019; 87 FR 76996, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>239.7305</SECTNO>
                            <SUBJECT>Exclusion and limitation on disclosure.</SUBJECT>
                            <P>Subject to 239.7304, the individuals authorized in 239.7303 may, in the course of procuring information technology, whether as a service or as a supply, that is a covered system, is a part of a covered system, or is in support of a covered system—</P>
                            <P>(a) Exclude a source that fails to meet qualification standards established in accordance with the requirements of 10 U.S.C. 3243, for the purpose of reducing supply chain risk in the acquisition of covered systems;</P>
                            <P>(b) Exclude a source that fails to achieve an acceptable rating with regard to an evaluation factor providing for the consideration of supply chain risk in the evaluation of proposals for the award of a contract or the issuance of a task or delivery order;</P>
                            <P>(c) Withhold consent for a contractor to subcontract with a particular source or direct a contractor for a covered system to exclude a particular source from consideration for a subcontract under the contract; and</P>
                            <P>(d) Limit, notwithstanding any other provision of law, in whole or in part, the disclosure of information relating to the basis for carrying out any of the actions authorized by paragraphs (a) through (c) of this section, and if such disclosures are so limited—</P>
                            <P>(1) No action undertaken by the individual authorized under such authority shall be subject to review in a bid protest before the Government Accountability Office or in any Federal court; and</P>
                            <P>(2) The authorized individual shall—</P>
                            <P>(i) Notify appropriate parties of action taken under paragraphs (a) through (d) of this section and the basis for such action only to the extent necessary to effectuate the action;</P>
                            <P>(ii) Notify other Department of Defense components or other Federal agencies responsible for procurements that may be subject to the same or similar supply chain risk, in a manner and to the extent consistent with the requirements of national security; and</P>
                            <P>(iii) Ensure the confidentiality of any such notifications.</P>
                            <CITA>[78 FR 69271, Nov. 18, 2013, as amended at 80 FR 67251, Oct. 30, 2015; 87 FR 76996, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>239.7306</SECTNO>
                            <SUBJECT>Solicitation provision and contract clause.</SUBJECT>
                            <P>
                                (a) Insert the provision at 252.239-7017, Notice of Supply Chain Risk, in 
                                <PRTPAGE P="374"/>
                                solicitations, including solicitations using FAR part 12 procedures for the acquisition of commercial products and commercial services, for information technology, whether acquired as a service or as a supply, that is a covered system, is a part of a covered system, or is in support of a covered system, as defined at 239.7301.
                            </P>
                            <P>(b) Insert the clause at 252.239-7018, Supply Chain Risk, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, for information technology, whether acquired as a service or as a supply, that is a covered system, is a part of a covered system, or is in support of a covered system, as defined at 239.7301.</P>
                            <CITA>[80 FR 67252, Oct. 30, 2015, as amended at 88 FR 6588, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 239.74—Telecommunications Services</HD>
                        <SECTION>
                            <SECTNO>239.7400</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>This subpart prescribes policy and procedures for acquisition of telecommunications services and maintenance of telecommunications security. Telecommunications services meet the definition of information technology.</P>
                            <CITA>[62 FR 1060, Jan. 8, 1997, as amended at 71 FR 39011, July 11, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>239.7401</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this subpart—</P>
                            <P>
                                ) 
                                <E T="03">Common carrier</E>
                                 means any entity engaged in the business of providing telecommunications services which are regulated by the Federal Communications Commission or other governmental body.
                            </P>
                            <P>
                                <E T="03">Foreign carrier</E>
                                 means any person, partnership, association, joint-stock company, trust, governmental body, or corporation not subject to regulation by a U.S. governmental regulatory body and not doing business as a citizen of the United States, providing telecommunications services outside the territorial limits of the United States.
                            </P>
                            <P>
                                <E T="03">Governmental regulatory body</E>
                                 means the Federal Communications Commission, any statewide regulatory body, or any body with less than statewide jurisdiction when operating under the State authority. The following are not “governmental regulatory bodies”—
                            </P>
                            <P>(1) Regulatory bodies whose decisions are not subject to judicial appeal; and</P>
                            <P>(2) Regulatory bodies which regulate a company owned by the same entity which creates the regulatory body.</P>
                            <P>
                                <E T="03">Long-haul telecommunications</E>
                                 means all general and special purpose long-distance telecommunications facilities and services (including commercial satellite services, terminal equipment and local circuitry supporting the long-haul service) to or from the post, camp, base, or station switch and/or main distribution frame (except for trunk lines to the first-serving commercial central office for local communications services).
                            </P>
                            <P>
                                <E T="03">Noncommon carrier</E>
                                 means any entity other than a common carrier offering telecommunications facilities, services, or equipment for lease.
                            </P>
                            <P>
                                <E T="03">Securing, sensitive information,</E>
                                 and 
                                <E T="03">telecommunications systems</E>
                                 have the meaning given in the clause at 252.239-7016, Telecommunications Security Equipment, Devices, Techniques, and Services.
                            </P>
                            <P>
                                <E T="03">Telecommunications</E>
                                 means the transmission, emission, or reception of signals, signs, writing, images, sounds, or intelligence of any nature, by wire, cable, satellite, fiber optics, laser, radio, or any other electronic, electric, electromagnetic, or acoustically coupled means.
                            </P>
                            <P>
                                <E T="03">Telecommunications services</E>
                                 means the services acquired, whether by lease or contract, to meet the Government's telecommunications needs. The term includes the telecommunications facilities and equipment necessary to provide such services.
                            </P>
                            <CITA>[56 FR 36429, July 31, 1991, as amended at 70 FR 67918, Nov. 9, 2005; 81 FR 28733, May 10, 2016]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>239.7402</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Acquisition.</E>
                                 DoD policy is to acquire telecommunications services from common and noncommon telecommunications carriers—
                            </P>
                            <P>(1) On a competitive basis, except when acquisition using other than full and open competition is justified;</P>
                            <P>
                                (2) Recognizing the regulations, practices, and decisions of the Federal 
                                <PRTPAGE P="375"/>
                                Communications Commission (FCC) and other governmental regulatory bodies on rates, cost principles, and accounting practices; and
                            </P>
                            <P>(3) Making provision in telecommunications services contracts for adoption of—</P>
                            <P>(i) FCC approved practices; or</P>
                            <P>(ii) The generally accepted practices of the industry on those issues concerning common carrier services where—</P>
                            <P>(A) The governmental regulatory body has not expressed itself;</P>
                            <P>(B) The governmental regulatory body has declined jurisdiction; or</P>
                            <P>(C) There is no governmental regulatory body to decide.</P>
                            <P>
                                (b) 
                                <E T="03">Security.</E>
                                 (1) The contracting officer shall ensure, in accordance with agency procedures, that purchase requests identify—
                            </P>
                            <P>(i) The nature and extent of information requiring security during telecommunications;</P>
                            <P>(ii) The requirement for the contractor to secure telecommunications systems;</P>
                            <P>(iii) The telecommunications security equipment, devices, techniques, or services with which the contractor's telecommunications security equipment, devices, techniques, or services must be interoperable; and</P>
                            <P>(iv) The approved telecommunications security equipment, devices, techniques, or services, such as found in the National Security Agency's Information Systems Security Products and Services Catalogue.</P>
                            <P>(2) Contractors and subcontractors shall provide all telecommunications security techniques or services required for performance of Government contracts.</P>
                            <P>(3) Except as provided in paragraph (b)(4) of this section, contractors and subcontractors shall normally provide all required property, to include telecommunications security equipment or related devices, in accordance with FAR 45.102. In some cases, such as for communications security (COMSEC) equipment designated as controlled cryptographic item (CCI), contractors or subcontractors must also meet ownership eligibility conditions.</P>
                            <P>(4) The head of the agency may authorize provision of the necessary property as Government-furnished property or acquisition as contractor-acquired property, as long as conditions of FAR 45.102(b) are met.</P>
                            <P>
                                (c) 
                                <E T="03">Foreign carriers.</E>
                                 For information on contracting with foreign carriers, see PGI 239.7402(c).
                            </P>
                            <CITA>[56 FR 36429, July 31, 1991, as amended at 56 FR 67220, Dec. 30, 1991; 62 FR 1060, Jan. 8, 1997; 71 FR 39011, July 11, 2006; 74 FR 37647, July 29, 2009]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>239.7403-239.7404</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>239.7405</SECTNO>
                            <SUBJECT>Delegated authority for telecommunications resources.</SUBJECT>
                            <P>The contracting officer may enter into a telecommunications service contract on a month-to-month basis or for any longer period or series of periods, not to exceed a total of 10 years. See PGI 239.7405 for documents relating to this contracting authority, which the General Services Administration has delegated to DoD.</P>
                            <CITA>[70 FR 67918, Nov. 9, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>239.7406</SECTNO>
                            <SUBJECT>Certified cost or pricing data and data other than certified cost or pricing data.</SUBJECT>
                            <P>(a) Common carriers are not required to submit certified cost or pricing data before award of contracts for tariffed services. Rates or preliminary estimates quoted by a common carrier for tariffed telecommunications services are considered to be prices set by regulation within the provisions of 10 U.S.C. 3703. This is true even if the tariff is set after execution of the contract.</P>
                            <P>(b) Rates or preliminary estimates quoted by a common carrier for nontariffed telecommunications services or by a noncommon carrier for any telecommunications service are not considered prices set by law or regulation.</P>
                            <P>
                                (c) Contracting officers shall obtain sufficient data to determine that the prices are reasonable in accordance with FAR 15.403-3 or 15.403-4. See 
                                <E T="03">PGI 239.7406</E>
                                 for examples of instances where additional data may be necessary to determine price reasonableness.
                            </P>
                            <CITA>[77 FR 76940, Dec. 31, 2012, as amended at 87 FR 76996, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="376"/>
                            <SECTNO>239.7407</SECTNO>
                            <SUBJECT>Type of contract.</SUBJECT>
                            <P>When acquiring telecommunications services, the contracting officer may use a basic agreement (see FAR 16.702) in conjunction with communication service authorizations. When using this method, follow the procedures at PGI 239.7407.</P>
                            <CITA>[71 FR 27646, May 12, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>239.7408</SECTNO>
                            <SUBJECT>Special construction.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>239.7408-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>(a) Special construction normally involves a common carrier giving a special service or facility related to the performance of the basic telecommunications service requirements.</P>
                            <P>This may include—</P>
                            <P>(1) Moving or relocating equipment;</P>
                            <P>(2) Providing temporary facilities;</P>
                            <P>(3) Expediting provision of facilities; or</P>
                            <P>(4) Providing specially constructed channel facilities to meet Government requirements.</P>
                            <P>(b) Use this subpart instead of FAR part 36 for acquisition of “special construction.”</P>
                            <P>(c) Special construction costs may be—</P>
                            <P>(1) A contingent liability for using telecommunications services for a shorter time than the minimum to reimburse the contractor for unamortized nonrecoverable costs. These costs are usually expressed in terms of a termination liability, as provided in the contract or by tariff;</P>
                            <P>(2) A onetime special construction charge;</P>
                            <P>(3) Recurring charges for constructed facilities;</P>
                            <P>(4) A minimum service charge;</P>
                            <P>(5) An expediting charge; or</P>
                            <P>(6) A move or relocation charge.</P>
                            <P>(d) When a common carrier submits a proposal or quotation which has special construction requirements, the contracting officer shall require a detailed special construction proposal. Analyze all special construction proposals to—</P>
                            <P>(1) Determine the adequacy of the proposed construction;</P>
                            <P>(2) Disclose excessive or duplicative construction; and</P>
                            <P>(3) When different forms of charge are possible, provide for the form of charge most advantageous to the Government.</P>
                            <P>(e) When possible, analyze and approve special construction charges before receiving the service. Impose a ceiling on the special construction costs before authorizing the contractor to proceed, if prior approval is not possible. The contracting officer must approve special construction charges before final payment.</P>
                            <CITA>[56 FR 36429, July 31, 1991, as amended at 71 FR 39011, July 11, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>239.7408-2</SECTNO>
                            <SUBJECT>Applicability of construction labor standards for special construction.</SUBJECT>
                            <P>(a) The construction labor standards in FAR Subpart 22.4 ordinarily do not apply to special construction. However, if the special construction includes construction, alteration, or repair (as defined in FAR 22.401) of a public building or public work, the construction labor standards may apply. Determine applicability under FAR 22.402.</P>
                            <P>(b) Each CSA or other type contract which is subject to construction labor standards under FAR 22.402 shall cite that fact.</P>
                            <CITA>[56 FR 36429, July 31, 1991, as amended at 71 FR 39011, July 11, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>239.7409</SECTNO>
                            <SUBJECT>Special assembly.</SUBJECT>
                            <P>(a) Special assembly is the designing, manufacturing, arranging, assembling, or wiring of equipment to provide telecommunications services that cannot be provided with general use equipment.</P>
                            <P>(b) Special assembly rates and charges shall be based on estimated costs. The contracting officer should negotiate special assembly rates and charges before starting service. When it is not possible to negotiate in advance, use provisional rates and charges subject to adjustment, until final rates and charges are negotiated. The CSAs authorizing the special assembly shall be modified to reflect negotiated final rates and charges.</P>
                            <CITA>[56 FR 36429, July 31, 1991, as amended at 71 FR 39011, July 11, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>239.7410</SECTNO>
                            <SUBJECT>Cancellation and termination.</SUBJECT>
                            <P>
                                (a)(1) Cancellation is stopping a requirement after placing of an order but before service starts.
                                <PRTPAGE P="377"/>
                            </P>
                            <P>(2) Termination is stopping a requirement after placing an order and after service starts.</P>
                            <P>(b) Determine cancellation or termination charges under the provisions of the applicable tariff or agreement/contract.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>239.7411</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>(a) In addition to other appropriate FAR and DFARS clauses, use the following clauses in solicitations, contracts, and basic agreements for telecommunications services. Modify the clauses only if necessary to meet the requirements of a governmental regulatory agency.</P>
                            <P>(1) 252.239-7002, Access.</P>
                            <P>(2) 252.239-7004, Orders for Facilities and Services.</P>
                            <P>(3) 252.239-7007, Cancellation or Termination of Orders.</P>
                            <P>(b) Use the following clauses in solicitations, contracts, and basic agreements for telecommunications services when the acquisition includes or may include special construction. Modify the clauses only if necessary to meet the requirements of a governmental regulatory agency—</P>
                            <P>(1) 252.239-7011, Special Construction and Equipment Charges; and</P>
                            <P>(2) 252.239-7012, Title to Telecommunication Facilities and Equipment.</P>
                            <P>(c) Use the basic or alternate of the clause at 252.239-7013, Term of Agreement and Continuation of Services, in basic agreements for telecommunications services.</P>
                            <P>(1) Use the basic clause in basic agreements that do not supersede an existing basic agreement with the contractor.</P>
                            <P>(2) Use the alternate I clause in basic agreements that supersede an existing basic agreement with the contractor. Complete paragraph (c)(1) of the clause with the basic agreement number, date, and contacting office that issued the basic agreement being superseded.</P>
                            <P>(d) Use the clause at 252.239-7016, Telecommunications Security Equipment, Devices, Techniques, and Services, in solicitations and contracts when performance of a contract requires secure telecommunications.</P>
                            <CITA>[56 FR 36429, July 31, 1991, as amended at 57 FR 42632, Sept. 15, 1992; 62 FR 40473, July 29, 1997; 70 FR 67919, Nov. 9, 2005; 71 FR 39011, July 11, 2006; 84 FR 48497, 48498, Sept. 13, 2019; 84 FR 58338, Oct. 31, 2019; 86 FR 3837, Jan. 15, 2021]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 239.76—Cloud Computing</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>80 FR 51743, Aug. 26, 2015, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>239.7600</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>This subpart prescribes policies and procedures for the acquisition of cloud computing services.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>239.7601</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this subpart—</P>
                            <P>
                                <E T="03">Authorizing official,</E>
                                 as described in DoD Instruction 8510.01, Risk Management Framework (RMF) for DoD Information Technology (IT), means the senior Federal official or executive with the authority to formally assume responsibility for operating an information system at an acceptable level of risk to organizational operations (including mission, functions, image, or reputation), organizational assets, individuals, other organizations, and the Nation.
                            </P>
                            <P>
                                <E T="03">Cloud computing</E>
                                 means a model for enabling ubiquitous, convenient, on-demand network access to a shared pool of configurable computing resources (
                                <E T="03">e.g.,</E>
                                 networks, servers, storage, applications, and services) that can be rapidly provisioned and released with minimal management effort or service provider interaction. This includes other commercial terms, such as on-demand self-service, broad network access, resource pooling, rapid elasticity, and measured service. It also includes commercial offerings for software-as-a-service, infrastructure-as-a-service, and platform-as-a-service.
                            </P>
                            <P>
                                <E T="03">Government data</E>
                                 means any information, document, media, or machine readable material regardless of physical form or characteristics, that is created or obtained by the Government in the course of official Government business.
                                <PRTPAGE P="378"/>
                            </P>
                            <P>
                                <E T="03">Government-related data</E>
                                 means any information, document, media, or machine readable material regardless of physical form or characteristics that is created or obtained by a contractor through the storage, processing, or communication of Government data. This does not include a contractor's business records (
                                <E T="03">e.g.,</E>
                                 financial records, legal records, etc.) or data such as operating procedures, software coding, or algorithms that are not uniquely applied to the Government data.
                            </P>
                            <P>
                                <E T="03">Information system</E>
                                 means a discrete set of information resources organized for the collection, processing, maintenance, use, sharing, dissemination, or disposition of information.
                            </P>
                            <P>
                                <E T="03">Media</E>
                                 means physical devices or writing surfaces including, but not limited to, magnetic tapes, optical disks, magnetic disks, large-scale integration memory chips, and printouts onto which information is recorded, stored, or printed within an information system.
                            </P>
                            <CITA>[80 FR 51743, Aug. 26, 2015, as amended at 81 FR 72999, Oct. 21, 2016]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>239.7602</SECTNO>
                            <SUBJECT>Policy and responsibilities.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>239.7602-1</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>(a) Generally, DoD shall acquire cloud computing services using commercial terms and conditions that are consistent with Federal law, and an agency's needs, including those requirements specified in this subpart. Some examples of commercial terms and conditions are license agreements, End User License Agreements (EULAs), Terms of Service (TOS), or other similar legal instruments or agreements. Contracting officers shall incorporate any applicable service provider terms and conditions into the contract by attachment or other appropriate mechanism. Contracting officers shall carefully review commercial terms and conditions and consult counsel to ensure these are consistent with Federal law, regulation, and the agency's needs.</P>
                            <P>
                                (b)(1) Except as provided in paragraph (b)(2) of this section, the contracting officer shall only award a contract to acquire cloud computing services from a cloud service provider (
                                <E T="03">e.g.,</E>
                                 contractor or subcontractor, regardless of tier) that has been granted provisional authorization by Defense Information Systems Agency, at the level appropriate to the requirement, to provide the relevant cloud computing services in accordance with the Cloud Computing Security Requirements Guide (SRG) (version in effect at the time the solicitation is issued or as authorized by the contracting officer) found at 
                                <E T="03">https://public.cyber.mil/dccs/</E>
                                .
                            </P>
                            <P>(2) The contracting officer may award a contract to acquire cloud computing services from a cloud service provider that has not been granted provisional authorization when—</P>
                            <P>(i) The requirement for a provisional authorization is waived by the DoD Chief Information Officer; or</P>
                            <P>(ii) The cloud computing service requirement is for a private, on-premises version that will be provided from U.S. Government facilities. Under this circumstance, the cloud service provider must obtain a provisional authorization prior to operational use.</P>
                            <P>(c) When contracting for cloud computing services, the contracting officer shall ensure the following information is provided by the requiring activity:</P>
                            <P>(1) Government data and Government-related data descriptions.</P>
                            <P>
                                (2) Data ownership, licensing, delivery and disposition instructions specific to the relevant types of Government data and Government-related data (
                                <E T="03">e.g.,</E>
                                 DD Form 1423, Contract Data Requirements List; work statement task; line item). Disposition instructions shall provide for the transition of data in commercially available, or open and non-proprietary format (and for permanent records, in accordance with disposition guidance issued by National Archives and Record Administration).
                            </P>
                            <P>(3) Appropriate requirements to support applicable inspection, audit, investigation, or other similar authorized activities specific to the relevant types of Government data and Government-related data, or specific to the type of cloud computing services being acquired.</P>
                            <P>
                                (4) Appropriate requirements to support and cooperate with applicable system-wide search and access capabilities 
                                <PRTPAGE P="379"/>
                                for inspections, audits, investigations, , and similar authorized activities.
                            </P>
                            <CITA>[80 FR 51743, Aug. 26, 2015, as amended at 81 FR 72999, Oct. 21, 2016; 86 FR 59871, Oct. 29, 2021]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>239.7602-2</SECTNO>
                            <SUBJECT>Required storage of data within the United States or outlying areas.</SUBJECT>
                            <P>(a) Cloud computing service providers are required to maintain within the 50 states, the District of Columbia, or outlying areas of the United States, all Government data that is not physically located on DoD premises, unless otherwise authorized by the authorizing official, as described in DoD Instruction 8510.01, in accordance with the SRG.</P>
                            <P>
                                (b) The contracting officer shall provide written notification to the contractor when the contractor is permitted to maintain Government data at a location outside the 50 States, the District of Columbia, and outlying areas of the United States. 
                                <E T="03">See</E>
                                 PGI 239.7602-2 for additional guidance.
                            </P>
                            <CITA>[80 FR 51743, Aug. 26, 2015, as amended at 81 FR 72999, Oct. 21, 2016; 86 FR 59871, Oct. 29, 2021]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>239.7603</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>Follow the procedures relating to cloud computing at PGI 239.7603.</P>
                            <CITA>[80 FR 74695, Nov. 30, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>239.7604</SECTNO>
                            <SUBJECT>Solicitation provision and contract clause.</SUBJECT>
                            <P>(a) Use the provision at 252.239-7009, Representation of Use of Cloud Computing, in solicitations, including solicitations using FAR part 12 procedures for the acquisition of commercial products and commercial services, for information technology services.</P>
                            <P>(b) Use the clause at 252.239-7010, Cloud Computing Services, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, for information technology services.</P>
                            <CITA>[80 FR 51743, Aug. 26, 2015. Redesignated at 80 FR 74695, Nov. 30, 2015; 88 FR 6588, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 241</EAR>
                    <HD SOURCE="HED">PART 241—ACQUISITION OF UTILITY SERVICES</HD>
                    <CONTENTS>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 241.1—General</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>241.101</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>241.102</SECTNO>
                            <SUBJECT>Applicability.</SUBJECT>
                            <SECTNO>241.103</SECTNO>
                            <SUBJECT>Statutory and delegated authority.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 241.2—Acquiring Utility Services</HD>
                            <SECTNO>241.201</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>241.202</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>241.205</SECTNO>
                            <SUBJECT>Separate contracts.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 241.5—Solicitation Provision and Contract Clauses</HD>
                            <SECTNO>241.501</SECTNO>
                            <SUBJECT>Solicitation provision and contract clauses.</SUBJECT>
                            <SECTNO>241.501-70</SECTNO>
                            <SUBJECT>Additional clauses.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>63 FR 11539, Mar. 9, 1998, unless otherwise noted.</P>
                    </SOURCE>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 241.1—General</HD>
                        <SECTION>
                            <SECTNO>241.101</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this part—</P>
                            <P>
                                <E T="03">Independent regulatory body</E>
                                 means the Federal Energy Regulatory Commission, a state-wide agency, or an agency with less than state-wide jurisdiction when operating pursuant to state authority. The body has the power to fix, establish, or control the rates and services of utility suppliers.
                            </P>
                            <P>
                                <E T="03">Nonindependent regulatory body</E>
                                 means a body that regulates a utility supplier which is owned or operated by the same entity that created the regulatory body, e.g., a municipal utility.
                            </P>
                            <P>
                                <E T="03">Regulated utility supplier</E>
                                 means a utility supplier regulated by an independent regulatory body.
                            </P>
                            <P>
                                <E T="03">Service power procurement officer</E>
                                 means for the—
                            </P>
                            <P>(1) Army, the Chief of Engineers;</P>
                            <P>(2) Navy, the Commander, Naval Facilities Engineering Command;</P>
                            <P>(3) Air Force, the head of a contracting activity; and</P>
                            <P>(4) Defense Logistics Agency, the head of a contracting activity.</P>
                            <CITA>[63 FR 11539, Mar. 9, 1998, as amended at 71 FR 3417, Jan. 23, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="380"/>
                            <SECTNO>241.102</SECTNO>
                            <SUBJECT>Applicability.</SUBJECT>
                            <P>(a) This part applies to purchase of utility services from nonregulated and regulated utility suppliers. It includes the acquisition of liquefied petroleum gas as a utility service when purchased from regulated utility suppliers.</P>
                            <P>(b)(7) This part does not apply to third party financed projects. However, it may be used for any purchased utility services directly resulting from such projects, including those authorized by—</P>
                            <P>(A) 10 U.S.C. 2394 for energy, fuels, and energy production facilities for periods not to exceed 30 years;</P>
                            <P>(B) 10 U.S.C. 2394a for renewable energy for periods not to exceed 25 years;</P>
                            <P>(C) 10 U.S.C. 2917 for geothermal resources that result in energy production facilities;</P>
                            <P>(D) 10 U.S.C. 2809 for potable and waste water treatment plants for periods not to exceed 32 years; and</P>
                            <P>(E) 10 U.S.C. 2812 for lease/purchase of energy production facilities for periods not to exceed 32 years.</P>
                            <CITA>[63 FR 11539, Mar. 9, 1998, as amended at 87 FR 15818, Mar. 18, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>241.103</SECTNO>
                            <SUBJECT>Statutory and delegated authority.</SUBJECT>
                            <P>(1) The contracting officer may enter into a utility service contract related to the conveyance of a utility system for a period not to exceed 50 years (10 U.S.C. 2688(d)(2)).</P>
                            <P>(2) The contracting officer may enter into an energy savings contract under 10 U.S.C. 2913 for a period not to exceed 25 years.</P>
                            <P>(3) See 217.174 for authority to enter into multiyear contracts for electricity from renewable energy sources.</P>
                            <P>(4) See PGI 241.103 for statutory authorities and maximum contract periods for utility and energy contracts.</P>
                            <CITA>[71 FR 3417, Jan. 23, 2006, as amended at 74 FR 52896, Oct. 15, 2009; 75 FR 34943, June 21, 2010; 76 FR 58155, Sept. 20, 2011; 81 FR 28734, May 10, 2016]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 241.2—Acquiring Utility Services</HD>
                        <SECTION>
                            <SECTNO>241.201</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(1) DoD, as a matter of comity, generally complies with the current regulations, practices, and decisions of independent regulatory bodies. This policy does not extend to nonindependent regulatory bodies.</P>
                            <P>(2) Purchases of utility services outside the United States may use—</P>
                            <P>(i) Formats and technical provisions consistent with local practice; and</P>
                            <P>(ii) Dual language forms and contracts.</P>
                            <P>(3) Rates established by an independent regulatory body—</P>
                            <P>(i) Are considered “prices set by law or regulation”;</P>
                            <P>(ii) Are sufficient to set prices without obtaining certified cost or pricing data (see FAR subpart 15.4); and</P>
                            <P>(iii) Are a valid basis on which prices can be determined fair and reasonable.</P>
                            <P>(4) Compliance with the regulations, practices, and decisions of independent regulatory bodies as a matter of comity is not a substitute for the procedures at FAR 41.202(a).</P>
                            <CITA>[71 FR 3418, Jan. 23, 2006, as amended at 77 FR 76940, Dec. 31, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>241.202</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>
                                (1) 
                                <E T="03">Connection and service charges.</E>
                                 The Government may pay a connection charge when required to cover the cost of the necessary connecting facilities. A connection charge based on the estimated labor cost of installing and removing the facility shall not include salvage cost. A lump-sum connection charge shall be no more than the agreed cost of the connecting facilities less net salvage. The order of precedence for contractual treatment of connection and service charges is—
                            </P>
                            <P>(i) No connection charge.</P>
                            <P>(ii) Termination liability. Use when an obligation is necessary to secure the required services. The obligation must be not more than the agreed connection charge, less any net salvage material costs. Use of a termination liability instead of a connection charge requires the approval of the service power procurement officer or designee.</P>
                            <P>
                                (iii) Connection charge, refundable. Use a refundable connection charge when the supplier refuses to provide the facilities based on lack of capital or published rules which prohibit providing up-front funding. The contract should provide for refund of the connection charge within five years unless 
                                <PRTPAGE P="381"/>
                                a longer period or omission of the refund requirement is authorized by the service power procurement officer or designee.
                            </P>
                            <P>(iv) Connection and service charges, nonrefundable. The Government may pay certain nonrefundable, nonrecurring charges including service initiation charges, a contribution in aid of construction, membership fees, and charges required by the supplier's rules and regulations to be paid by the customer. If possible, consider sharing with other than Government users the use of (and costs for) facilities when large nonrefundable charges are required.</P>
                            <P>
                                (2) 
                                <E T="03">Construction and labor requirements.</E>
                                 Follow the procedures at PGI 241.202(2) for construction and labor requirements associated with connection and service charges.
                            </P>
                            <CITA>[71 FR 3417, Jan. 23, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>241.205</SECTNO>
                            <SUBJECT>Separate contracts.</SUBJECT>
                            <P>Follow the procedures at PGI 241.205 when acquiring utility services by separate contract.</P>
                            <CITA>[71 FR 3417, Jan. 23, 2006]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 241.5—Solicitation Provision and Contract Clauses</HD>
                        <SECTION>
                            <SECTNO>241.501</SECTNO>
                            <SUBJECT>Solicitation provision and contract clauses.</SUBJECT>
                            <P>(d)(1) Use a clause substantially the same as the clause at FAR 52.241-7, Change in Rates or Terms and Conditions of Service for Regulated Services, when the utility services to be provided are subject to an independent regulatory body.</P>
                            <P>(2) Use a clause substantially the same as the clause at FAR 52.241-8, Change in Rates or Terms and Conditions of Service for Unregulated Services, when the utility services to be provided are not subject to a regulatory body or are subject to a nonindependent regulatory body.</P>
                            <CITA>[71 FR 3418, Jan. 23, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>241.501-70</SECTNO>
                            <SUBJECT>Additional clauses.</SUBJECT>
                            <P>(a) If the Government must execute a superseding contract and capital credits, connection charge credits, or termination liability exist, use the clause at 252.241-7000, Superseding Contract.</P>
                            <P>(b) Use the clause at 252.241-70001, Government Access, when the clause at FAR 52.241-5, Contractor's Facilities, is used.</P>
                        </SECTION>
                    </SUBPART>
                </PART>
            </SUBCHAP>
            <SUBCHAP TYPE="P">
                <PRTPAGE P="382"/>
                <HD SOURCE="HED">SUBCHAPTER G—CONTRACT MANAGEMENT</HD>
                <PART>
                    <EAR>Pt. 242</EAR>
                    <HD SOURCE="HED">PART 242—CONTRACT ADMINISTRATION AND AUDIT SERVICES</HD>
                    <CONTENTS>
                        <SECHD>Sec.</SECHD>
                        <SECTNO>242.002</SECTNO>
                        <SUBJECT>Interagency agreements.</SUBJECT>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 242.2—Contract Administration Services</HD>
                            <SECTNO>242.200-70</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>242.202</SECTNO>
                            <SUBJECT>Assignment of contract administration.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 242.3—Contract Administration Office Functions</HD>
                            <SECTNO>242.301</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>242.302</SECTNO>
                            <SUBJECT>Contract administration functions.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 242.5—Postaward Orientation</HD>
                            <SECTNO>242.503</SECTNO>
                            <SUBJECT>Postaward conferences.</SUBJECT>
                            <SECTNO>242.503-2</SECTNO>
                            <SUBJECT>Post-award conference procedure.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 242.6—Corporate Administrative Contracting Officer</HD>
                            <SECTNO>242.602</SECTNO>
                            <SUBJECT>Assignment and location.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 242.7—Indirect Cost Rates</HD>
                            <SECTNO>242.705</SECTNO>
                            <SUBJECT>Final indirect cost rates.</SUBJECT>
                            <SECTNO>242.705-1</SECTNO>
                            <SUBJECT>Contracting officer determination procedure.</SUBJECT>
                            <SECTNO>242.705-2</SECTNO>
                            <SUBJECT>Auditor determination procedure.</SUBJECT>
                            <SECTNO>242.708</SECTNO>
                            <SUBJECT>Quick-closeout procedure.</SUBJECT>
                            <SECTNO>242.771</SECTNO>
                            <SUBJECT>Independent research and development and bid and proposal costs.</SUBJECT>
                            <SECTNO>242.771-1</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>242.771-2</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>242.771-3</SECTNO>
                            <SUBJECT>Responsibilities.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 242.8—Disallowance of Costs</HD>
                            <SECTNO>242.803</SECTNO>
                            <SUBJECT>Disallowing costs after incurrence.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 242.11—Production Surveillance and Reporting</HD>
                            <SECTNO>242.1104</SECTNO>
                            <SUBJECT>Surveillance requirements.</SUBJECT>
                            <SECTNO>242.1105</SECTNO>
                            <SUBJECT>Assignment of criticality designator.</SUBJECT>
                            <SECTNO>242.1106</SECTNO>
                            <SUBJECT>Reporting requirements.</SUBJECT>
                            <SECTNO>242.1107</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 242.12—Novation and Change-of-Name Agreements</HD>
                            <SECTNO>242.1203</SECTNO>
                            <SUBJECT>Processing agreements.</SUBJECT>
                            <SECTNO>242.1204</SECTNO>
                            <SUBJECT>Applicability of novation agreements.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 242.15—Contractor Performance Information</HD>
                            <SECTNO>242.1502</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 242.70—Contractor Business Systems</HD>
                            <SECTNO>242.7000</SECTNO>
                            <SUBJECT>Contractor business system deficiencies.</SUBJECT>
                            <SECTNO>242.7001</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 242.71—Voluntary Refunds</HD>
                            <SECTNO>242.7100</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 242.72—Contractor Material Management and Accounting System</HD>
                            <SECTNO>242.7200</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>242.7201</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>242.7202</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>242.7203</SECTNO>
                            <SUBJECT>Review procedures.</SUBJECT>
                            <SECTNO>242.7204</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 242.73—Contractor Insurance/Pension Review</HD>
                            <SECTNO>242.7301</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>242.7302</SECTNO>
                            <SUBJECT>Requirements.</SUBJECT>
                            <SECTNO>242.7303</SECTNO>
                            <SUBJECT>Responsibilities.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 242.74—Technical Representation at Contractor Facilities</HD>
                            <SECTNO>242.7400</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>242.7401</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 242.75—Contractor Accounting Systems and Related Controls</HD>
                            <SECTNO>242.7501</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>242.7502</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>242.7503</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36437, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SECTION>
                        <SECTNO>242.002</SECTNO>
                        <SUBJECT>Interagency agreements.</SUBJECT>
                        <P>(b)(i) DoD requires reimbursement, at a rate set by the Under Secretary of Defense (Comptroller/Chief Financial Officer), from non-DoD organizations, except for—</P>
                        <P>
                            (A) Quality assurance, contract administration, and audit services provided under a no-charge reciprocal agreement;
                            <PRTPAGE P="383"/>
                        </P>
                        <P>(B) Services performed under subcontracts awarded by the Small Business Administration under FAR subpart 19.8; and</P>
                        <P>(C) Quality assurance requests performed for the Canadian Department of National Defence and pricing services performed for Public Works and Government Services Canada (PWGSC), operating as Public Services and Procurment Canada (PSPC).</P>
                        <P>(ii) Departments and agencies may request an exception from the reimbursement policy in paragraph (b)(i) of this section from the Under Secretary of Defense (Comptroller/Chief Financial Officer). A request must show that an exception is in the best interest of the Government.</P>
                        <P>(iii) Departments and agencies must pay for services performed by non-DoD activities, foreign governments, or international organizations, unless otherwise provided by reciprocal agreements.</P>
                        <P>(S-70)(i) Foreign governments and international organizations may request contract administration services on their direct purchases from U.S. producers. Direct purchase is the purchase of defense supplies in the United States through commercial channels for use by the foreign government or international organization.</P>
                        <P>(ii) PWGSC, operating as PSPC, is permitted to submit its requests for contract administration services directly to the cognizant contract administration office.</P>
                        <P>(iii) Other foreign governments (including Canadian government organizations other than PSPC) and international organizations send their requests for contract administration services to the DoD Central Control Point (CCP) at the Headquarters, Defense Contract Management Agency, International and Federal Business Team. Contract administration offices provide services only upon request from the CCP. The CCP shall follow the procedures at PGI 242.002(S-70)(iii).</P>
                        <CITA>[64 FR 61029, Nov. 9, 1999, as amended at 65 FR 52952, Aug. 31, 2000; 65 FR 63804, Oct. 25, 2000; 70 FR 67920, Nov. 9, 2005; 83 FR 12681, Mar. 23, 2018]</CITA>
                    </SECTION>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 242.2—Contract Administration Services</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>64 FR 61029, Nov. 9, 1999, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>242.200-70</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>This subpart does not address the contract administration role of a contracting officer's representative (see 201.602).</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>242.202</SECTNO>
                            <SUBJECT>Assignment of contract administration.</SUBJECT>
                            <P>(a)(i) DoD activities shall not retain any contract for administration that requires performance of any contract administration function at or near contractor facilities, except contracts for—</P>
                            <P>(A) The National Security Agency;</P>
                            <P>(B) Research and development with universities;</P>
                            <P>(C) Flight training;</P>
                            <P>(D) Management and professional support services;</P>
                            <P>(E) Mapping, charting, and geodesy services;</P>
                            <P>(F) Base, post, camp, and station purchases;</P>
                            <P>(G) Operation or maintenance of, or installation of equipment at, radar or communication network sites;</P>
                            <P>(H) Communications services;</P>
                            <P>(I) Installation, operation, and maintenance of space-track sensors and relays;</P>
                            <P>(J) Dependents Medicare program contracts;</P>
                            <P>(K) Stevedoring contracts;</P>
                            <P>(L) Construction and maintenance of military and civil public works, including harbors, docks, port facilities, military housing, development of recreational facilities, water resources, flood control, and public utilities;</P>
                            <P>(M) Architect-engineer services;</P>
                            <P>(N) Airlift and sealift services (Air Mobility Command and Military Sealift Command may perform contract administration services at contractor locations involved solely in performance of airlift or sealift contracts);</P>
                            <P>(O) Subsistence supplies;</P>
                            <P>
                                (P) Ballistic missile sites (contract administration offices may perform supporting administration of these contracts at missile activation sites during the installation, test, and 
                                <PRTPAGE P="384"/>
                                checkout of the missiles and associated equipment);
                            </P>
                            <P>(Q) Operation and maintenance of, or installation of equipment at, military test ranges, facilities, and installations; and</P>
                            <P>(R) The Defense Energy Support Center, Defense Logistics Agency.</P>
                            <P>(ii) Contract administration functions for base, post, camp, and station contracts on a military installation are normally the responsibility of the installation or tenant commander. However, the Defense Contract Management Agency (DCMA) shall, upon request of the military department, and subject to prior agreement, perform contract administration services on a military installation.</P>
                            <P>(iii) DCMA shall provide preaward survey assistance for post, camp, and station work performed on a military installation. The contracting office and the DCMA preaward survey monitor should jointly determine the scope of the survey and individual responsibilities.</P>
                            <P>(iv) To avoid duplication, contracting offices shall not locate their personnel at contractor facilities, except—</P>
                            <P>(A) In support of contracts retained for administration in accordance with paragraph (a)(i) of this section; or</P>
                            <P>(B) As permitted under subpart 242.74.</P>
                            <P>
                                (e)(1)(A) In special circumstances, a contract administration office may request support from a component not listed in the Federal Directory of Contract Administration Services Components (available via the internet at 
                                <E T="03">https://piee.eb.mil/pcm/xhtml/unauth/index.xhtml</E>
                                ).
                            </P>
                            <P>(B) When requesting support on a subcontract that includes foreign contract military sale (FMS) requirements, the contract administration office shall—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Mark “FMS Requirement” on the face of the documents; and
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) For each FMS case involved, provide the FMS case identifier, associated item quantities, DoD prime contract number, and prime contract line/subline item number.
                            </P>
                            <CITA>[64 FR 61029, Nov. 9, 1999, as amended at 65 FR 52953, Aug. 31, 2000; 66 FR 49861, Oct. 1, 2001; 66 FR 63335, Dec. 6, 2001; 70 FR 52034, Sept. 1, 2005; 70 FR 67920, Nov. 9, 2005; 77 FR 23632, Apr. 20, 2012; 86 FR 27278, May 20, 2021]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 242.3—Contract Administration Office Functions</HD>
                        <SECTION>
                            <SECTNO>242.301</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>Contract administration services performed outside the U.S. should be performed in accordance with FAR 42.301 unless there are no policies and procedures covering a given situation. In this case, coordinate proposed actions with the appropriate U.S. country teams or commanders of unified and specified commands.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>242.302</SECTNO>
                            <SUBJECT>Contract administration functions.</SUBJECT>
                            <P>(a) (7) See 242.7502 for ACO responsibilities with regard to receipt of an audit report identifying significant accounting system or related internal control deficiencies.</P>
                            <P>(9) For additional contract administration functions related to IR&amp;D projects and B&amp;P projects performed by major contractors, see 242.771-3(a).</P>
                            <P>(12) Also perform all payment administration in accordance with any applicable payment clauses.</P>
                            <P>(13)(A) Do not delegate the responsibility to make payments to the Defense Contract Management Agency (DCMA).</P>
                            <P>(B) Follow the procedures at PGI 242.302(a)(13)(B) for designation of payment offices.</P>
                            <P>(39) See 223.370 for contract administration responsibilities on contracts for ammunition and explosives.</P>
                            <P>(56) Within DoD, maintaining surveillance of aircraft flight and ground operations is accomplished by incorporating into the contract, task order, or delivery order the requirements of the applicable version of the combined regulation/instruction entitled “Contractor's Flight and Ground Operations” (Air Force Instruction 10-220, Army Regulation 95-20, Naval Air Systems Command (NAVAIR) Instruction 3710.1 (Series), Coast Guard Instruction M13020.3 (Series), and Defense Contract Management Agency Instruction 8210-1 (Series)). See PGI 242.302(a)(56).</P>
                            <P>
                                (67) Also support program offices and buying activities in precontractual efforts leading to a solicitation or award.
                                <PRTPAGE P="385"/>
                            </P>
                            <P>(S-70) Serve as the single point of contact for all Single Process Initiative (SPI) Management Council activities. The ACO shall negotiate and execute facilitywide class modifications and agreements for SPI processes, when authorized by the affected components.</P>
                            <P>(S-71) DCMA has responsibility for reviewing earned value management system (EVMS) plans and for verifying initial and continuing contractor compliance with DoD EVMS criteria. The contracting officer shall not retain this function.</P>
                            <P>
                                (S-72) Ensure implementation of the Synchronized Predeployment and Operational Tracker (SPOT) by the contractor and maintain surveillance over contractor compliance with SPOT business rules available at the Web site provided at PGI 207.105(b)(20)(C)(
                                <E T="03">9</E>
                                ) for contracts incorporating the clause at 252.225-7040, Contractor Personnel Supporting U.S. Armed Forces Deployed Outside the United States. See PGI 242.302(a)(S-72) for guidance on assessing contractor's implementation of SPOT.
                            </P>
                            <P>(S-73) Maintain surveillance over contractor compliance with trafficking in persons requirements for all DoD contracts for services incorporating the clause at FAR 52.222-50, Combating Trafficking in Persons, and, when necessary, its Alternate I, as identified in the clause prescription at FAR 22.1705. (See PGI 222.1703.)</P>
                            <P>(S-74) Approve or disapprove contractor business systems, as identified in the clause at 252.242-7005, Contractor Business Systems.</P>
                            <P>(S-75) See PGI 242.302(a)(S-75) for guidelines for monitoring contractor costs.</P>
                            <P>(S-76) Review and audit contractor identification of contractor-approved suppliers for the acquisition of electronic parts, as identified in the clause at 252.246-7008, Sources of Electronic Parts.</P>
                            <P>(b)(S-70) Issue, negotiate, and execute orders under basic ordering agreements for overhaul, maintenance, and repair.</P>
                            <P>(S-71)(A) Except for classified contracts, negotiate or settle questioned direct costs in an incurred cost audit. The procuring contracting officer may delegate this authority to the contract administration office (CAO) only upon prior coordination and agreement with the CAO. Upon such delegation, the procuring contracting officer shall provide the CAO access within 30 days to all supporting documentation in their possession related to the questioned direct costs in an incurred cost audit.</P>
                            <P>(B) After settlement of the questioned direct costs, the CAO shall provide the procuring contracting office the results of the settlement. The procuring contracting office shall make any adjustments resulting from the settlement on affected contracts and report such adjustments to the CAO.</P>
                            <CITA>[71 FR 44928, Aug. 8, 2006, as amended at 76 FR 36884, June 23, 2011; 76 FR 71830, Nov. 18, 2011; 77 FR 11365, Feb. 24, 2012; 77 FR 23632, Apr. 20, 2012; 78 FR 13544, Feb. 28, 2013; 79 FR 30471, May 28, 2014; 80 FR 36903, June 26, 2015; 81 FR 50648, Aug. 2, 2016; 88 FR 6600, Jan. 31, 2023; 88 FR 17352, 17355, Mar. 22, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 242.5—Postaward Orientation</HD>
                        <SECTION>
                            <SECTNO>242.503</SECTNO>
                            <SUBJECT>Postaward conferences.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>242.503-2</SECTNO>
                            <SUBJECT>Post-award conference procedure.</SUBJECT>
                            <P>(a) DD Form 1484, Post-Award Conference Record, may be used in conducting the conference and in preparing the conference report.</P>
                            <P>(b) For contracts that include the clause at 252.234-7004, Cost and Software Data Reporting, postaward conferences shall include a discussion of the contractor's standard cost and software data reporting (CSDR) process that satisfies the guidelines contained in the DoD 5000.04-M-1, CSDR Manual, and the requirements in the Government-approved CSDR plan for the contract, DD Form 2794, and related Resource Distribution Table.</P>
                            <CITA>[70 FR 67920, Nov. 9, 2005, as amended at 75 FR 71562, Nov. 24, 2010]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <PRTPAGE P="386"/>
                        <HD SOURCE="HED">Subpart 242.6—Corporate Administrative Contracting Officer</HD>
                        <SECTION>
                            <SECTNO>242.602</SECTNO>
                            <SUBJECT>Assignment and location.</SUBJECT>
                            <P>(c)(2) If the agencies cannot agree, refer the matter to the Principal Director, Defense Pricing, Contracting, and Acquisition Policy.</P>
                            <CITA>[56 FR 36437, July 31, 1991, as amended at 68 FR 7440, Feb. 14, 2003; 88 FR 73237, Oct. 25, 2023; 89 FR 60832, July 29, 2024]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 242.7—Indirect Cost Rates</HD>
                        <SECTION>
                            <SECTNO>242.705</SECTNO>
                            <SUBJECT>Final indirect cost rates.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>242.705-1</SECTNO>
                            <SUBJECT>Contracting officer determination procedure.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Applicability and responsibility.</E>
                                 (1) The corporate administrative contracting officer and individual administrative contracting officers shall jointly decide how to conduct negotiations. Follow the procedures at PGI 242.705-1(a)(1) when negotiations are conducted on a coordinated basis.
                            </P>
                            <CITA>[70 FR 67920, Nov. 9, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>242.705-2</SECTNO>
                            <SUBJECT>Auditor determination procedure.</SUBJECT>
                            <P>
                                (b) 
                                <E T="03">Procedures.</E>
                                 (2)(iii) When agreement cannot be reached with the contractor, the auditor will issue a DCAA Form 1, Notice of Contract Costs Suspended and/or Disapproved, in addition to the advisory report to the administrative contracting officer.
                            </P>
                            <CITA>[56 FR 36437, July 31, 1991, as amended at 60 FR 61599, Nov. 30, 1995; 64 FR 61030, Nov. 9, 1999; 70 FR 67920, Nov. 9, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>242.708</SECTNO>
                            <SUBJECT>Quick-closeout procedure.</SUBJECT>
                            <P>(a) Defense Contract Management Agency administrative contracting officers are authorized to negotiate the settlement of direct and indirect costs for a specific contract, task order, or delivery order to be closed in advance of the determination of final direct costs and indirect rates set forth in FAR 42.705, regardless of the dollar value or percentage of unsettled direct or indirect costs allocable to the contract, task order, or delivery order.</P>
                            <P>(2) In lieu of the thresholds at FAR 42.708(a)(2)(i) and (ii), the amount of unsettled direct costs and indirect costs to be allocated to the contract, task order, or delivery order will be considered relatively insignificant when the total unsettled direct costs and indirect costs to be allocated to any one contract, task order, or delivery order do not exceed $2 million, regardless of the total contract, task order, or delivery order amount.</P>
                            <CITA>[88 FR 12865, Mar. 1, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>242.771</SECTNO>
                            <SUBJECT>Independent research and development and bid and proposal costs.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>242.771-1</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>This section implements 10 U.S.C. 3762, Independent research and development costs: allowable costs; 10 U.S.C. 3763, Bid and proposal costs: allowable costs; and 10 U.S.C. 3847, Defense Contract Audit Agency: annual report.</P>
                            <CITA>[88 FR 6600, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>242.771-2</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>Defense contractors are encouraged to engage in independent research and development (IR&amp;D) projects that will advance the needs of DoD for future technology and advanced capability (see 231.205-18(c)(iii)).</P>
                            <CITA>[88 FR 6600, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>242.771-3</SECTNO>
                            <SUBJECT>Responsibilities.</SUBJECT>
                            <P>(a) The cognizant administrative contracting officer (ACO) or corporate ACO shall determine cost allowability of IR&amp;D costs and bid and proposal (B&amp;P) costs as set forth in 231.205-18 and FAR 31.205-18.</P>
                            <P>(b) The Defense Contract Audit Agency (DCAA) shall—</P>
                            <P>(1) For the DoD-wide B&amp;P program, submit an annual report to the Principal Director, Defense Pricing, Contracting, and Acquisition Policy, Office of the Under Secretary of Defense for Acquisition and Sustainment, in connection with 10 U.S.C. 3763(c); the Defense Contract Management Agency or the military department responsible for performing contract administration functions is responsible for providing DCAA with statistical information, as necessary; and</P>
                            <P>
                                (2) For IR&amp;D costs and B&amp;P costs incurred under any DoD contract in the 
                                <PRTPAGE P="387"/>
                                previous Government fiscal year, submit an annual report to the congressional defense committees as required by 10 U.S.C. 3847.
                            </P>
                            <P>(c) The Office of the Under Secretary of Defense for Research and Engineering (OUSD(R&amp;E)), is responsible for establishing a regular method for communication—</P>
                            <P>
                                (1)(i) From DoD to contractors, of timely and comprehensive information regarding planned or expected needs of DoD for future technology and advanced capability, by posting information on communities of interest and upcoming meetings on the Defense Technical Information Center (DTIC) website at 
                                <E T="03">https://defenseinnovationmarketplace.dtic.mil/communities-of-interest;</E>
                                 and
                            </P>
                            <P>(ii) From contractors to DoD, of brief technical descriptions of contractor IR&amp;D projects; and</P>
                            <P>
                                (2) By providing OUSD(R&amp;E) contact information: 
                                <E T="03">osd.pentagon.ousd-re.mbx.communications@mail.mil.</E>
                            </P>
                            <CITA>[88 FR 6600, Jan. 31, 2023, as amended at 89 FR 60832, July 29, 2024]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 242.8—Disallowance of Costs</HD>
                        <SECTION>
                            <SECTNO>242.803</SECTNO>
                            <SUBJECT>Disallowing costs after incurrence.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Contracting officer receipt of vouchers.</E>
                                 Contracting officer receipt of vouchers is applicable only for cost-reimbursement contracts with the Canadian Commercial Corporation. See 225.870-5(b) for invoice procedures.
                            </P>
                            <P>
                                (b) 
                                <E T="03">Auditor receipt of voucher.</E>
                                 (i) The contract auditor is the authorized representative of the contracting officer for—
                            </P>
                            <P>(A) Receiving vouchers from contractors electronically or by other delivery methods as directed by the terms of the contract;</P>
                            <P>(B) Approving interim vouchers that were selected using sampling methodologies for provisional payment and sending them to the disbursing office after a pre-payment review. Interim vouchers not selected for a pre-payment review will be considered to be provisionally approved and will be sent directly to the disbursing office. All provisionally approved interim vouchers are subject to a later audit of actual costs incurred;</P>
                            <P>(C) Reviewing completion/final vouchers and sending them to the administrative contracting officer; and</P>
                            <P>(D) Issuing DCAA Forms 1, Notice of Contract Costs Suspended and/or Disapproved, to deduct costs where allowability is questionable.</P>
                            <P>(ii) The administrative contracting officer—</P>
                            <P>(A) Approves all completion/final vouchers and sends them to the disbursing officer; and</P>
                            <P>(B) May issue or direct the issuance of DCAA Form 1 on any cost when there is reason to believe it should be suspended or disallowed.</P>
                            <CITA>[61 FR 25409, May 21, 1996, as amended at 61 FR 25409, May 21, 1996; 61 FR 50454, Sept. 26, 1996; 77 FR 52259, Aug. 29, 2012]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 242.11—Production Surveillance and Reporting</HD>
                        <SECTION>
                            <SECTNO>242.1104</SECTNO>
                            <SUBJECT>Surveillance requirements.</SUBJECT>
                            <P>(a) The cognizant contract administration office (CAO)—</P>
                            <P>(i) Shall perform production surveillance on all contractors that have Criticality Designator A or B contracts;</P>
                            <P>(ii) Shall not perform production surveillance on contractors that have only Criticality Designator C contracts, unless specifically requested by the contracting officer; and</P>
                            <P>(iii) When production surveillance is required, shall—</P>
                            <P>(A) Conduct a periodic risk assessment of the contractor to determine the degree of production surveillance needed for all contracts awarded to that contractor. The risk assessment shall consider information provided by the contractor and the contracting officer;</P>
                            <P>(B) Develop a production surveillance plan based on the risk level determined during a risk assessment;</P>
                            <P>
                                (C) Modify the production surveillance plan to incorporate any special surveillance requirements for individual contracts, including any requirements identified by the contracting officer; and
                                <PRTPAGE P="388"/>
                            </P>
                            <P>(D) Monitor contract progress and identify potential contract delinquencies in accordance with the production surveillance plan. Contracts with Criticality Designator C are exempt from this requirement unless specifically requested by the contracting officer.</P>
                            <CITA>[69 FR 31912, June 8, 2004]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>242.1105</SECTNO>
                            <SUBJECT>Assignment of criticality designator.</SUBJECT>
                            <P>(1) Contracting officers shall—</P>
                            <P>(i) Assign criticality designator A to items with a priority 01, 02, 03, or 06 (if emergency supply of clothing) under DoD Manual 4140.01, Volume 5, DoD Supply Chain Materiel Management Procedures: Delivery of Materiel; and</P>
                            <P>(ii) Ordinarily assign criticality designator C to unilateral purchase orders.</P>
                            <P>(2) Only the contracting officer shall change the assigned designator.</P>
                            <CITA>[56 FR 36437, July 31, 1991, as amended at 67 FR 61516, Oct. 1, 2002, 82 FR 61481, Dec. 28, 2017]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>242.1106</SECTNO>
                            <SUBJECT>Reporting requirements.</SUBJECT>
                            <P>(a) See DoDI 5000.2, Operation of the Defense Acquisition System, for reporting requirements for defense technology projects and acquisition programs.</P>
                            <P>(b)(i) Within four working days after receipt of the contractor's report, the CAO must provide the report and any required comments to the contracting officer and, unless otherwise specified in the contract, the inventory control manager.</P>
                            <P>(ii) If the contractor's report indicates that the contract is on schedule and the CAO agrees, the CAO does not need to add further comments. In all other cases, the CAO must add comments and recommend a course of action.</P>
                            <CITA>[65 FR 39723, June 27, 2000, as amended at 70 FR 14575, Mar. 23, 2005; 73 FR 21848, Apr. 23, 2008]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>242.1107</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>(b) When using the clause at FAR 52.242-2, include the following instructions in the contract schedule—</P>
                            <P>(i) Frequency and timing of reporting (normally 5 working days after each reporting period);</P>
                            <P>(ii) Contract line items, exhibits, or exhibit line items requiring reports;</P>
                            <P>(iii) Offices (with addressees/codes) where reports should be sent (always include the contracting office and contract administration office); and</P>
                            <P>(iv) The following requirements for report content—</P>
                            <P>(A) The problem, actual or potential, and its cause;</P>
                            <P>(B) Items and quantities affected;</P>
                            <P>(C) When the delinquency started or will start;</P>
                            <P>(D) Actions taken to overcome the delinquency;</P>
                            <P>(E) Estimated recovery date; and/or</P>
                            <P>(F) Proposed schedule revision.</P>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 242.12—Novation and Change-of-Name Agreements</HD>
                        <SECTION>
                            <SECTNO>242.1203</SECTNO>
                            <SUBJECT>Processing agreements.</SUBJECT>
                            <P>The responsible contracting officer shall process and execute novation and change-of-name agreements in accordance with the procedures at PGI 242.1203.</P>
                            <CITA>[70 FR 67920, Nov. 9, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>242.1204</SECTNO>
                            <SUBJECT>Applicability of novation agreements.</SUBJECT>
                            <P>(i) When a novation agreement is required and the transferee intends to incur restructuring costs as defined at 213.205-70, the cognizant contracting officer shall include the following provision as paragraph (b)(7) of the novation agreement instead of the paragraph (b)(7) provided in the sample format at FAR 42.1204(i):</P>
                            <EXTRACT>
                                <P>“(7)(i) Except as set forth in subparagraph (7)(ii) below, the Transferor and the Transferee agree that the Government is not obligated to pay or reimburse either of them for, or otherwise give effect to, any costs, taxes, or other expenses, or any related increases, directly or indirectly arising out of or resulting from the transfer or this Agreement, other than those that the Government in the absence of this transfer or Agreement would have been obligated to pay or reimburse under the terms of the contracts.</P>
                                <P>
                                    (ii) The Government recognizes that restructuring by the Transferee incidental to the acquisition/merger may be in the best interests of the Government. Restructuring costs that are allowable under Part 31 of the 
                                    <PRTPAGE P="389"/>
                                    Federal Acquisition Regulation (FAR) or Part 231 of the Defense Federal Acquisition Regulation Supplement (DFARS) may be reimbursed under flexibily-priced novated contracts, provided the Transferee demonstrates that the restructuring will reduce overall costs to the Department of Defense (DoD) (and to the National Aeronautics and Space Administration (NASA), where there is a mix of DoD and NASA contracts), and the requirements included in DFARS 231.205-70 are met. Restructuring costs shall not be allowed on novated contracts unless there is an audit of the restructuring proposal; a determination by the contracting officer of overall reduced costs to DoD/NASA; and an Advance Agreement setting forth a cumulative cost ceiling for restructuring projects and the period to which such costs shall be assigned.”
                                </P>
                            </EXTRACT>
                            <CITA>[60 FR 1749, Jan. 5, 1995, as amended at 61 FR 16882, Apr. 18, 1996; 65 FR 63805, Oct. 25, 2000; 86 FR 59871, Oct. 29, 2021]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 242.15—Contractor Performance Information</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>83 FR 15999, Apr. 13, 2018, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>242.1502</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(g) Past performance evaluations in the Contractor Performance Assessment Reporting System—</P>
                            <P>(i) Shall include an assessment of the contractor's performance against, and efforts to achieve, the goals identified in its comprehensive small business subcontracting plan when the contract contains the clause at 252.219-7004, Small Business Subcontracting Plan (Test Program);</P>
                            <P>(ii) Shall, unless exempted by the head of the contracting activity, include a notation on contractors that have denied multiple requests for submission of data other than certified cost or pricing data over the preceding 3-year period, but nevertheless received an award (10 U.S.C. 3705(b)(2)(B)); and</P>
                            <P>(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)).</P>
                            <CITA>[87 FR 65504, Oct. 28, 2022, as amended at 87 FR 76996, Dec. 16, 2022; 89 FR 78994, Sept. 26, 2024]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 242.70—Contractor Business Systems</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>76 FR 28868, May 18, 2011, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>242.7000</SECTNO>
                            <SUBJECT>Contractor business system deficiencies.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Definitions.</E>
                                 As used in this subpart—
                            </P>
                            <P>
                                <E T="03">Acceptable contractor business systems</E>
                                 and 
                                <E T="03">contractor business systems</E>
                                 are defined in the clause at 252.242-7005, Contractor Business Systems.
                            </P>
                            <P>
                                <E T="03">Covered contract</E>
                                 means a contract that is subject to the Cost Accounting Standards under 41 U.S.C. chapter 15, as implemented in regulations found at 48 CFR 9903.201-1 (see the FAR Appendix) (10 U.S.C. 3841 note prec., as amended by section 816 of Pub. L. 112-81).
                            </P>
                            <P>
                                <E T="03">Significant deficiency</E>
                                 is defined in the clause at 252.242-7005, Contractor Business Systems.
                            </P>
                            <P>
                                (b) 
                                <E T="03">Determination to withhold payments.</E>
                                 If the contracting officer makes a final determination to disapprove a contractor's business system in accordance with the clause at 252.242-7005, Contractor Business Systems, the contracting officer shall—
                            </P>
                            <P>
                                (1) In accordance with agency procedures, identify one or more covered contracts containing the clause at 252.242-7005, Contractor Business Systems, from which payments will be withheld. When identifying the covered contracts from which to withhold payments, the contracting officer shall ensure that the total amount of payment withholding under 252.242-7005, does not exceed 10 percent of progress payments, performance-based payments, and interim payments under cost-reimbursement, labor-hour, and time-and-materials contracts billed under each of the identified covered contracts. Similarly, the contracting officer shall ensure that the total amount of payment withholding under the clause at 252.242-7005, Contractor Business Systems, for each business system does not exceed five percent of progress payments, performance-based payments, and interim payments under cost-reimbursement, labor-hour, and time-and-materials contracts billed under each of the identified covered contracts. The 
                                <PRTPAGE P="390"/>
                                contracting officer has the sole discretion to identify the covered contracts from which to withhold payments.
                            </P>
                            <P>(2) Promptly notify the contractor, in writing, of the contracting officer's determination to implement payment withholding in accordance with the clause at 252.242-7005, Contractor Business Systems. The notice of payment withholding shall be included in the contracting officer's written final determination for the contractor business system and shall inform the contractor that—</P>
                            <P>(i) Payments shall be withheld from the contract or contracts identified in the written determination in accordance with the clause at 252.242-7005, Contractor Business Systems, until the contracting officer determines that there are no remaining significant deficiencies; and</P>
                            <P>(ii) The contracting officer reserves the right to take other actions within the terms and conditions of the contract.</P>
                            <P>(3) Provide all contracting officers administering the selected contracts from which payments will be withheld, a copy of the determination. The contracting officer shall also provide a copy of the determination to the auditor; payment office; affected contracting officers at the buying activities; and cognizant contracting officers in contract administration activities.</P>
                            <P>
                                (c) 
                                <E T="03">Monitoring contractor's corrective action.</E>
                                 The contracting officer, in consultation with the auditor or functional specialist, shall monitor the contractor's progress in correcting the deficiencies. The contracting officer shall notify the contractor of any decision to decrease or increase the amount of payment withholding in accordance with the clause at 252.242-7005, Contractor Business Systems.
                            </P>
                            <P>
                                (d) 
                                <E T="03">Correction of significant deficiencies.</E>
                                 (1) If the contractor notifies the contracting officer that the contractor has corrected the significant deficiencies, the contracting officer shall request the auditor or functional specialist to review the correction to verify that the deficiencies have been corrected. If, after receipt of verification, the contracting officer determines that the contractor has corrected all significant deficiencies as directed by the contracting officer's final determination, the contracting officer shall discontinue the withholding of payments, release any payments previously withheld, and approve the system, unless other significant deficiencies remain.
                            </P>
                            <P>(2) Prior to the receipt of verification, the contracting officer may discontinue withholding payments pending receipt of verification, and release any payments previously withheld, if the contractor submits evidence that the significant deficiencies have been corrected, and the contracting officer, in consultation with the auditor or functional specialist, determines that there is a reasonable expectation that the corrective actions have been implemented and are expected to correct the significant deficiencies.</P>
                            <P>(3) Within 90 days of receipt of the contractor notification that the contractor has corrected the significant deficiencies, the contracting officer shall—</P>
                            <P>(i) Make a determination that—</P>
                            <P>(A) The contractor has corrected all significant deficiencies as directed by the contracting officer's final determination in accordance with paragraph (d)(1) of this section;</P>
                            <P>(B) There is a reasonable expectation that the corrective actions have been implemented in accordance with paragraph (d)(2) of this section; or</P>
                            <P>(C) The contractor has not corrected all significant deficiencies as directed by the contracting officer's final determination in accordance with paragraph (d)(1) of this section, or there is not a reasonable expectation that the corrective actions have been implemented in accordance with paragraph (d)(2) of this section; or</P>
                            <P>
                                (ii) Reduce withholding directly related to the significant deficiencies covered under the corrective action plan by at least 50 percent of the amount being withheld from progress payments and performance-based payments, and direct the contractor, in writing, to reduce the percentage withheld on interim cost vouchers by at least 50 percent, until the contracting officer makes a determination in accordance with paragraph (d)(3)(i) of this section.
                                <PRTPAGE P="391"/>
                            </P>
                            <P>(4) If, at any time, the contracting officer determines that the contractor has failed to correct the significant deficiencies identified in the contractor's notification, the contracting officer will continue, reinstate, or increase withholding from progress payments and performance-based payments, and direct the contractor, in writing, to continue, reinstate, or increase the percentage withheld on interim cost vouchers to the percentage initially withheld, until the contracting officer determines that the contractor has corrected all significant deficiencies as directed by the contracting officer's final determination.</P>
                            <P>(e) For sample formats for written notifications of contracting officer determinations to initiate payment withholding, reduce payment withholding, and discontinue payment withholding in accordance with the clause at DFARS 252.242-7005, Contractor Business Systems, see PGI 242.7000.</P>
                            <CITA>[76 FR 28868, May 18, 2011, as amended at 77 FR 11365, Feb. 24, 2012; 87 FR 76996, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>242.7001</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at 252.242-7005, Contractor Business Systems, in solicitations and contracts (other than in contracts with educational institutions, Federally Funded Research and Development Centers (FFRDCs), or University Associated Research Centers (UARCs) operated by educational institutions) when—</P>
                            <P>(a) The resulting contract will be a covered contract as defined in 242.7000(a); and</P>
                            <P>(b) The solicitation or contract includes any of the following clauses:</P>
                            <P>(1) 252.215-7002, Cost Estimating System Requirements.</P>
                            <P>(2) 252.234-7002, Earned Value Management System.</P>
                            <P>(3) 252.242-7004, Material Management and Accounting System.</P>
                            <P>(4) 252.242-7006, Accounting System Administration.</P>
                            <P>(5) 252.244-7001, Contractor Purchasing System Administration.</P>
                            <P>(6) 252.245-7003, Contractor Property Management System Administration.</P>
                            <CITA>[76 FR 28868, May 18, 2011, as amended at 77 FR 11366, Feb. 24, 2012]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 242.71—Voluntary Refunds</HD>
                        <SECTION>
                            <SECTNO>242.7100</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>A voluntary refund is a payment or credit (adjustment under one or more contracts or subcontracts) to the Government from a contractor or subcontractor that is not required by any contractual or other legal obligation. Follow the procedures at PGI 242.7100 for voluntary refunds.</P>
                            <CITA>[70 FR 67920, Nov. 9, 2005]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 242.72—Contractor Material Management and Accounting System</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>65 FR 77833, Dec. 13, 2000, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>242.7200</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>(a) This subpart provides policies, procedures, and standards for use in the evaluation of a contractor's material management and accounting system (MMAS).</P>
                            <P>(b) The policies, procedures, and standards in this subpart—</P>
                            <P>(1) Apply only when the contractor has contracts exceeding the simplified acquisition threshold that are not for the acquisition of commercial products or commercial services and are either—</P>
                            <P>(i) Cost-reimbursement contracts; or</P>
                            <P>(ii) Fixed-price contracts with progress payments made on the basis of costs incurred by the contractor as work progresses under the contract; and</P>
                            <P>(2) Do not apply to small businesses, educational institutions, or nonprofit organizations.</P>
                            <CITA>[65 FR 77833, Dec. 13, 2000, as amended at 88 FR 6588, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>242.7201</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>
                                <E T="03">Acceptable material management and accounting system, material management and accounting system,</E>
                                 and 
                                <E T="03">valid time-phased requirements</E>
                                 are defined in the clause at 252.242-7004, Material Management and Accounting System.
                            </P>
                            <P>
                                <E T="03">Significant deficiency</E>
                                 is defined in the clause at 252.242.7004, Material Management and Accounting System.
                            </P>
                            <CITA>[76 FR 28869, May 18, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="392"/>
                            <SECTNO>242.7202</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(a) DoD policy is for its contractors to have an MMAS that conforms to the standards in paragraph (d) of the clause at 252.242-7004, Material Management and Accounting System, so that the system—</P>
                            <P>(1) Reasonably forecasts material requirements;</P>
                            <P>(2) Ensures the costs of purchased and fabricated material charged or allocated to a contract are based on valid time-phased requirements; and</P>
                            <P>(3) Maintains a consistent, equitable, and unbiased logic for costing of material transactions.</P>
                            <P>(b) The cognizant contracting officer, in consultation with the auditor and functional specialist, if appropriate, shall—</P>
                            <P>(1) Determine the acceptability of the contractor's MMAS and approve or disapprove the system; and</P>
                            <P>(2) Pursue correction of any deficiencies.</P>
                            <P>(c) In evaluating the acceptability of the contractor's MMAS, the contracting officer, in consultation with the auditor and functional specialist, if appropriate, shall determine whether the contractor's MMAS complies with the system criteria for an acceptable MMAS as prescribed in the clause at 252.242-7004, Material Management and Accounting System.</P>
                            <CITA>[76 FR 28869, May 18, 2011, as amended at 81 FR 36473, June 7, 2016]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>242.7203</SECTNO>
                            <SUBJECT>Review procedures.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Criteria for conducting reviews.</E>
                                 Conduct an MMAS review when—
                            </P>
                            <P>(1) A contractor has $40 million of qualifying sales to the Government during the contractor's preceding fiscal year; and</P>
                            <P>(2) The administrative contracting officer (ACO), with advice from the auditor, determines an MMAS review is needed based on a risk assessment of the contractor's past experience and current vulnerability.</P>
                            <P>
                                (b) 
                                <E T="03">Qualifying sales.</E>
                                 Qualifying sales are sales for which certified cost or pricing data were required under 10 U.S.C. 3702, as implemented in FAR 15.403, or that are contracts priced on other than a firm-fixed-price or fixed-price with economic price adjustment basis. Sales include prime contracts, subcontracts, and modifications to such contracts and subcontracts.
                            </P>
                            <P>
                                (c) 
                                <E T="03">Disposition of findings</E>
                                —(1) 
                                <E T="03">Reporting of findings.</E>
                                 The auditor or functional specialist shall document findings and recommendations in a report to the contracting officer. If the auditor or functional specialist identifies any significant MMAS deficiencies, the report shall describe the deficiencies in sufficient detail to allow the contracting officer to understand the deficiencies.
                            </P>
                            <P>
                                (2) 
                                <E T="03">Initial determination.</E>
                                 (i) The contracting officer shall review findings and recommendations and, if there are no significant deficiencies, shall promptly notify the contractor, in writing, that the contractor's MMAS is acceptable and approved; or
                            </P>
                            <P>(ii) If the contracting officer finds that there are one or more significant deficiencies (as defined in the clause at 252.242-7004, Material Management and Accounting System) due to the contractor's failure to meet one or more of the MMAS system criteria in the clause at 252.242-7004, Material Management and Accounting System, the contracting officer shall—</P>
                            <P>(A) Promptly make an initial written determination on any significant deficiencies and notify the contractor, in writing, providing a description of each significant deficiency in sufficient detail to allow the contractor to understand the deficiency;</P>
                            <P>(B) Request the contractor to respond, in writing, to the initial determination within 30 days; and</P>
                            <P>(C) Promptly evaluate the contractor's response to the initial determination in consultation with the auditor or functional specialist, and make a final determination.</P>
                            <P>
                                (3) 
                                <E T="03">Final determination.</E>
                                 (i) The ACO shall make a final determination and notify the contractor that—
                            </P>
                            <P>(A) The contractor's MMAS is acceptable and approved, and no deficiencies remain, or</P>
                            <P>
                                (B) Significant deficiencies remain. The notice shall identify any remaining significant deficiencies, and indicate the adequacy of any proposed or completed corrective action. The contracting officer shall—
                                <PRTPAGE P="393"/>
                            </P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Request that the contractor, within 45 days of receipt of the final determination, either correct the deficiencies or submit an acceptable corrective action plan showing milestones and actions to eliminate the deficiencies;
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Disapprove the system in accordance with the clause at 252.242-7004, Material Management and Accounting System; and
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) Withhold payments in accordance with the clause at 252.242-7005, Contractor Business Systems, if the clause is included in the contract.
                            </P>
                            <P>(ii) Follow the procedures relating to monitoring a contractor's corrective action and the correction of significant deficiencies in PGI 242.7203.</P>
                            <P>
                                (d) 
                                <E T="03">System approval.</E>
                                 The contracting officer shall promptly approve a previously disapproved MMAS and notify the contractor when the contracting officer determines that there are no remaining significant deficiencies.
                            </P>
                            <P>
                                (e) 
                                <E T="03">Contracting officer notifications.</E>
                                 The cognizant contracting officer shall promptly distribute copies of a determination to approve a system, disapprove a system and withhold payments, or approve a previously disapproved system and release withheld payments to the auditor; payment office; affected contracting officers at the buying activities; and cognizant contracting officers in contract administration activities.
                            </P>
                            <CITA>[65 FR 77833, Dec. 13, 2000, as amended at 76 FR 28869, May 18, 2011; 77 FR 76940, Dec. 31, 2012; 87 FR 76996, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>242.7204</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at 252.242-7004, Material Management and Accounting System, in all solicitations and contracts exceeding the simplified acquisition threshold that are not for the acquisition of commercial products or commercial services and—</P>
                            <P>(a) Are not awarded to small businesses, educational institutions, or nonprofit organizations; and</P>
                            <P>(b) Are either—</P>
                            <P>(1) Cost-reimbursement contracts; or</P>
                            <P>(2) Fixed-price contracts with progress payments made on the basis of costs incurred by the contractor as work progresses under the contract.</P>
                            <CITA>[65 FR 77833, Dec. 13, 2000, as amended at 88 FR 6588, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 242.73—Contractor Insurance/Pension Review</HD>
                        <SECTION>
                            <SECTNO>242.7301</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>(a) The administrative contracting officer (ACO) is responsible for determining the allowability of insurance/pension costs in Government contracts and for determining the need for a Contractor/Insurance Pension Review (CIPR). Defense Contract Management Agency (DCMA) insurance/pension specialists and Defense Contract Audit Agency (DCAA) auditors assist ACOs in making these determinations, conduct CIPRs when needed, and perform other routine audits as authorized under FAR 42.705 and 52.215-2. A CIPR is a DCMA/DCAA joint review that—</P>
                            <P>(1) Provides an in-depth evaluation of a contractor's—</P>
                            <P>(i) Insurance programs;</P>
                            <P>(ii) Pension plans;</P>
                            <P>(iii) Other deferred compensation plans; and</P>
                            <P>(iv) Related policies, procedures, practices, and costs; or</P>
                            <P>(2) Concentrates on specific areas of the contractor's insurance programs, pension plans, or other deferred compensation plans.</P>
                            <P>(b) DCMA is the DoD Executive Agent for the performance of all CIPRs.</P>
                            <P>(c) DCAA is the DoD agency designated for the performance of contract audit responsibilities related to Cost Accounting Standards administration as described in FAR subparts 30.2 and 30.6 as they relate to a contractor's insurance programs, pension plans, and other deferred compensation plans.</P>
                            <CITA>[71 FR 9273, Feb. 23, 2006, as amended at 77 FR 76940, Dec. 31, 2012; 82 FR 61481, Dec. 28, 2017]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>242.7302</SECTNO>
                            <SUBJECT>Requirements.</SUBJECT>
                            <P>(a)(1) An in-depth CIPR as described at DFARS 242.7301(a)(1) shall be conducted only when—</P>
                            <P>
                                (i) A contractor has $50 million of qualifying sales to the Government 
                                <PRTPAGE P="394"/>
                                during the contractor's preceding fiscal year; and
                            </P>
                            <P>(ii) The ACO, with advice from DCMA insurance/pension specialists and DCAA auditors, determines a CIPR is needed based on a risk assessment of the contractor's past experience and current vulnerability.</P>
                            <P>(2) Qualifying sales are sales for which certified cost or pricing data were required under 10 U.S.C. 3702, as implemented in FAR 15.403, or that are contracts priced on other than a firm-fixed-price or fixed-price with economic price adjustment basis. Sales include prime contracts, subcontracts, and modifications to such contracts and subcontracts.</P>
                            <P>(b) A special CIPR that concentrates on specific areas of a contractor's insurance programs, pension plans, or other deferred compensation plans shall be performed for a contractor (including, but not limited to, a contractor meeting the requirements in paragraph (a) of this section) when any of the following circumstances exists, but only if the circumstance(s) may result in a material impact on Government contract costs:</P>
                            <P>(1) Information or data reveals a deficiency in the contractor's insurance/pension program.</P>
                            <P>(2) The contractor proposes or implements changes in its insurance, pension, or deferred compensation plans.</P>
                            <P>(3) The contractor is involved in a merger, acquisition, or divestiture.</P>
                            <P>(4) The Government needs to follow up on contractor implementation of prior CIPR recommendations.</P>
                            <P>(c) The DCAA auditor shall use relevant findings and recommendations of previously performed CIPRs in determining the scope of any audits of insurance and pension costs.</P>
                            <P>(d) When a Government organization believes that a review of the contractor's insurance/pension program should be performed, that organization should provide a recommendation for a review to the ACO. If the ACO concurs, the review should be performed as part of an ACO-initiated special CIPR or as part of a CIPR already scheduled for the near future.</P>
                            <CITA>[78 FR 13544, Feb. 28, 2013, as amended at 87 FR 76996, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>242.7303</SECTNO>
                            <SUBJECT>Responsibilities.</SUBJECT>
                            <P>Follow the procedures at PGI 242.7303 when conducting a CIPR.</P>
                            <CITA>[71 FR 9273, Feb. 23, 2006]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 242.74—Technical Representation at Contractor Facilities</HD>
                        <SECTION>
                            <SECTNO>242.7400</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>(a) Program managers may conclude that they need technical representation in contractor facilities to perform non-contract administration service (CAS) technical duties and to provide liaison, guidance, and assistance on systems and programs. In these cases, the program manager may assign technical representatives under the procedures in 242.7401.</P>
                            <P>(b) A technical representative is a representative of a DoD program, project, or system office performing non-CAS technical duties at or near a contractor facility. A technical representative is not—</P>
                            <P>(1) A representative of a contract administration or contract audit component; or</P>
                            <P>(2) A contracting officer's representative (see 201.602).</P>
                            <CITA>[70 FR 67921, Nov. 9, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>242.7401</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>When the program, project, or system manager determines that a technical representative is required, follow the procedures at PGI 242.7401.</P>
                            <CITA>[70 FR 67921, Nov. 9, 2005]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 242.75—Contractor Accounting Systems and Related Controls</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>76 FR 28870, May 18, 2011, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>242.7501</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this subpart—</P>
                            <P>
                                <E T="03">Acceptable accounting system,</E>
                                 and 
                                <E T="03">accounting system</E>
                                 are defined in the clause at 252.242-7006, Accounting System Administration.
                            </P>
                            <P>
                                <E T="03">Significant deficiency</E>
                                 is defined in the clause at 252.242-7006, Accounting System Administration.
                            </P>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="395"/>
                            <SECTNO>242.7502</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(a) Contractors receiving cost-reimbursement, incentive type, time-and-materials, or labor-hour contracts, or contracts which provide for progress payments based on costs or on a percentage or stage of completion, shall maintain an accounting system.</P>
                            <P>(b) The cognizant contracting officer, in consultation with the auditor or functional specialist, shall—</P>
                            <P>(1) Determine the acceptability of a contractor's accounting system and approve or disapprove the system; and</P>
                            <P>(2) Pursue correction of any deficiencies.</P>
                            <P>(c) In evaluating the acceptability of a contractor's accounting system, the contracting officer, in consultation with the auditor or functional specialist, shall determine whether the contractor's accounting system complies with the system criteria for an acceptable accounting system as prescribed in the clause at 252.242-7006, Accounting System Administration.</P>
                            <P>
                                (d) 
                                <E T="03">Disposition of findings</E>
                                — (1) 
                                <E T="03">Reporting of findings.</E>
                                 The auditor shall document findings and recommendations in a report to the contracting officer. If the auditor identifies any significant accounting system deficiencies, the report shall describe the deficiencies in sufficient detail to allow the contracting officer to understand the deficiencies. Follow the procedures at PGI 242.7502 for reporting of deficiencies.
                            </P>
                            <P>
                                (2) 
                                <E T="03">Initial determination.</E>
                                 (i) The contracting officer shall review findings and recommendations and, if there are no significant deficiencies, shall promptly notify the contractor, in writing, that the contractor's accounting system is acceptable and approved; or
                            </P>
                            <P>(ii) If the contracting officer finds that there are one or more significant deficiencies (as defined in the clause at 252.242-7006, Accounting System Administration) due to the contractor's failure to meet one or more of the accounting system criteria in the clause at 252.242-7006, the contracting officer shall—</P>
                            <P>(A) Promptly make an initial written determination on any significant deficiencies and notify the contractor, in writing, providing a description of each significant deficiency in sufficient detail to allow the contractor to understand the deficiency;</P>
                            <P>(B) Request the contractor to respond, in writing, to the initial determination within 30 days; and</P>
                            <P>(C) Promptly evaluate the contractor's response to the initial determination, in consultation with the auditor or functional specialist, and make a final determination.</P>
                            <P>
                                (3) 
                                <E T="03">Final determination.</E>
                                 (i) The contracting officer shall make a final determination and notify the contractor, in writing, that—
                            </P>
                            <P>(A) The contractor's accounting system is acceptable and approved, and no significant deficiencies remain, or</P>
                            <P>(B) Significant deficiencies remain. The notice shall identify any remaining significant deficiencies, and indicate the adequacy of any proposed or completed corrective action. The contracting officer shall—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Request that the contractor, within 45 days of receipt of the final determination, either correct the deficiencies or submit an acceptable corrective action plan showing milestones and actions to eliminate the deficiencies;
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Make a determination to disapprove the system in accordance with the clause at 252.242-7006, Accounting System Administration; and
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) Withhold payments in accordance with the clause at 252.242-7005, Contractor Business Systems, if the clause is included in the contract.
                            </P>
                            <P>(ii) Follow the procedures relating to monitoring a contractor's corrective action and the correction of significant deficiencies in PGI 242.7502.</P>
                            <P>
                                (e) 
                                <E T="03">System approval.</E>
                                 The contracting officer shall promptly approve a previously disapproved accounting system and notify the contractor when the contracting officer determines that there are no remaining significant deficiencies.
                            </P>
                            <P>
                                (f) 
                                <E T="03">Contracting officer notifications.</E>
                                 The cognizant contracting officer shall promptly distribute copies of a determination to approve a system, disapprove a system and withhold payments, or approve a previously disapproved system and release withheld payments to the auditor; payment office; affected contracting officers at the buying activities; and cognizant 
                                <PRTPAGE P="396"/>
                                contracting officers in contract administration activities.
                            </P>
                            <P>
                                (g) 
                                <E T="03">Mitigating the risk of accounting system deficiencies on specific proposals.</E>
                            </P>
                            <P>(1) Field pricing teams shall discuss identified accounting system deficiencies and their impact in all reports on contractor proposals until the deficiencies are resolved.</P>
                            <P>
                                (2) The contracting officer responsible for negotiation of a proposal generated by an accounting system with an identified deficiency shall evaluate whether the deficiency impacts the negotiations. See also PGI 242.7502(g)(2). If it does not, the contracting officer should proceed with negotiations. If it does, the contracting officer should consider other alternatives, 
                                <E T="03">e.g.</E>
                                —
                            </P>
                            <P>(i) Allowing the contractor additional time to correct the accounting system deficiency and submit a corrected proposal;</P>
                            <P>(ii) Considering another type of contract;</P>
                            <P>(iii) Using additional cost analysis techniques to determine the reasonableness of the cost elements affected by the accounting system's deficiency;</P>
                            <P>(iv) Reducing the negotiation objective for profit or fee; or</P>
                            <P>(v) Including a contract (reopener) clause that provides for adjustment of the contract amount after award.</P>
                            <P>(3) The contracting officer who incorporates a reopener clause into the contract is responsible for negotiating price adjustments required by the clause. Any reopener clause necessitated by an accounting system deficiency should—</P>
                            <P>(i) Clearly identify the amounts and items that are in question at the time of negotiation;</P>
                            <P>(ii) Indicate a specific time or subsequent event by which the contractor will submit a supplemental proposal, including certified cost or pricing data, identifying the cost impact adjustment necessitated by the deficient accounting system;</P>
                            <P>(iii) Provide for the contracting officer to adjust the contract price unilaterally if the contractor fails to submit the supplemental proposal; and</P>
                            <P>(iv) Provide that failure of the Government and the contractor to agree to the price adjustment shall be a dispute under the Disputes clause.</P>
                            <CITA>[76 FR 28870, May 18, 2011, as amended at 77 FR 11366, Feb. 24, 2012; 77 FR 76940, Dec. 31, 2012; 80 FR 10390, Feb. 26, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>242.7503</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at 252.242-7006, Accounting System Administration, in solicitations and contracts when contemplating—</P>
                            <P>(a) A cost-reimbursement, incentive type, time-and-materials, or labor-hour contract; or</P>
                            <P>(b) A contract with progress payments made on the basis of costs incurred by the contractor or on a percentage or stage of completion.</P>
                            <CITA>[76 FR 28870, May 18, 2011, as amended at 77 FR 11366, Feb. 24, 2012; 82 FR 61481, Dec. 28, 2017]</CITA>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 243</EAR>
                    <HD SOURCE="HED">PART 243—CONTRACT MODIFICATIONS</HD>
                    <CONTENTS>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 243.1—General</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>243.107-70</SECTNO>
                            <SUBJECT>Notification of substantial impact on employment.</SUBJECT>
                            <SECTNO>243.170</SECTNO>
                            <SUBJECT>Identification of foreign military sale (FMS) requirements.</SUBJECT>
                            <SECTNO>243.171</SECTNO>
                            <SUBJECT>Obligation or deobligation of funds.</SUBJECT>
                            <SECTNO>243.172</SECTNO>
                            <SUBJECT>Application of modifications.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 243.2—Change Orders</HD>
                            <SECTNO>243.204</SECTNO>
                            <SUBJECT>Administration.</SUBJECT>
                            <SECTNO>243.204-70</SECTNO>
                            <SUBJECT>Definitization of change orders</SUBJECT>
                            <SECTNO>243.204-70-2</SECTNO>
                            <SUBJECT>Price ceiling.</SUBJECT>
                            <SECTNO>243.204-70-4</SECTNO>
                            <SUBJECT>Limitations on obligations.</SUBJECT>
                            <SECTNO>243.204-70-5</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <SECTNO>243.204-70-6</SECTNO>
                            <SUBJECT>Allowable profit.</SUBJECT>
                            <SECTNO>243.204-70-7</SECTNO>
                            <SUBJECT>Plans and reports.</SUBJECT>
                            <SECTNO>243.204-71</SECTNO>
                            <SUBJECT>Certification of requests for equitable adjustment.</SUBJECT>
                            <SECTNO>243.205</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <SECTNO>243.205-70</SECTNO>
                            <SUBJECT>Pricing of contract modifications.</SUBJECT>
                            <SECTNO>243.205-71</SECTNO>
                            <SUBJECT>Requests for equitable adjustment.</SUBJECT>
                            <SECTNO>243.205-72</SECTNO>
                            <SUBJECT>Unpriced change orders.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36446, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SUBPART>
                        <PRTPAGE P="397"/>
                        <HD SOURCE="HED">Subpart 243.1—General</HD>
                        <SECTION>
                            <SECTNO>243.107-70</SECTNO>
                            <SUBJECT>Notification of substantial impact on employment.</SUBJECT>
                            <P>The Secretary of Defense is required to notify the Secretary of Labor if a modification of a major defense contract or subcontract will have a substantial impact on employment. The clause prescribed at 249.7003(c) requires that the contractor notify its employees, its subcontractors, and State and local officials when a contract modification will have a substantial impact on employment.</P>
                            <CITA>[56 FR 67220, Dec. 30, 1991, as amended at 70 FR 67922, Nov. 9, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>243.170</SECTNO>
                            <SUBJECT>Identification of foreign military sale (FMS) requirements.</SUBJECT>
                            <P>Follow the procedures at PGI 243.170 for identifying contract modifications that add FMS requirements.</P>
                            <CITA>[70 FR 67922, Nov. 9, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>243.171</SECTNO>
                            <SUBJECT>Obligation or deobligation of funds.</SUBJECT>
                            <P>Follow the procedures at PGI 243.171 when obligating or deobligating funds.</P>
                            <CITA>[70 FR 67922, Nov. 9, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>243.172</SECTNO>
                            <SUBJECT>Application of modifications.</SUBJECT>
                            <P>Follow the procedures in 204.1671 for determining the sequence for application of modifications to a contract or order.</P>
                            <CITA>[77 FR 30368, May 22, 2012, as amended at 81 FR 9786, Feb. 26, 2016]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 243.2—Change Orders</HD>
                        <SECTION>
                            <SECTNO>243.204</SECTNO>
                            <SUBJECT>Administration.</SUBJECT>
                            <P>Follow the procedures at PGI 243.204 for administration of change orders.</P>
                            <CITA>[75 FR 48277, Aug. 10, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>243.204-70</SECTNO>
                            <SUBJECT>Definitization of change orders.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>243.204-70-1</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>(a) This subsection applies to unpriced change orders with an estimated value exceeding $5 million.</P>
                            <P>
                                (b) Unpriced change orders for foreign military sales and special access programs are not subject to this section, but the contracting officer shall apply the policy and procedures to them to the maximum extent practicable. If the contracting officer determines that it is impracticable to adhere to the policy and procedures of this section for an unpriced change order for a foreign military sale or a special access program, the contracting officer shall provide prior notice, through agency channels, to the Office of the Principal Director, Defense Pricing, Contracting, and Acquisition Policy (Contract Policy) via email at 
                                <E T="03">osd.pentagon.ousd-a-s.mbx.asda-dp-c-contractpolicy@mail.mil.</E>
                            </P>
                            <CITA>[75 FR 48277, Aug. 10, 2010, as amended at 88 FR 73237, Oct. 25, 2023; 89 FR 60832, July 29, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>243.204-70-2</SECTNO>
                            <SUBJECT>Price ceiling.</SUBJECT>
                            <P>Unpriced change orders shall include a not-to-exceed price.</P>
                            <CITA>[75 FR 48277, Aug. 10, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>243.204-70-3</SECTNO>
                            <SUBJECT>Definitization schedule.</SUBJECT>
                            <P>(a) Unpriced change orders shall contain definitization schedules that provide for definitization by the earlier of—</P>
                            <P>(1) The date that is 180 days after issuance of the change order (this date may be extended but may not exceed the date that is 180 days after the contractor submits a qualifying proposal); or</P>
                            <P>(2) The date on which the amount of funds obligated under the change order is equal to more than 50 percent of the not-to-exceed price.</P>
                            <P>(b) Submission of a qualifying proposal in accordance with the definitization schedule is a material element of the contract. If the contractor does not submit a timely qualifying proposal, the contracting officer may suspend or reduce progress payments under FAR 32.503-6, or take other appropriate action.</P>
                            <CITA>[75 FR 48277, Aug. 10, 2010, as amended at 82 FR 61481, Dec. 28, 2017]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>243.204-70-4</SECTNO>
                            <SUBJECT>Limitations on obligations.</SUBJECT>
                            <P>
                                (a) The Government shall not obligate more than 50 percent of the not-to-exceed price before definitization. However, if a contractor submits a qualifying proposal before 50 percent of 
                                <PRTPAGE P="398"/>
                                the not-to-exceed price has been obligated by the Government, the limitation on obligations before definitization may be increased to no more than 75 percent (
                                <E T="03">see</E>
                                 232.102-70 for coverage on provisional delivery payments).
                            </P>
                            <P>(b) Obligations should be consistent with the contractor's requirements for the undefinitized period.</P>
                            <CITA>[75 FR 48277, Aug. 10, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>243.204-70-5</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <P>(a) The limitations in 243.204-70-2, 243.204-70-3, and 243.204-70-4 do not apply to unpriced change orders for the purchase of initial spares.</P>
                            <P>(b) The limitations in 243.204-70-4(a) do not apply to unpriced change orders for ship construction and ship repair.</P>
                            <P>(c) The head of the agency may waive the limitations in 243.204-70-2, 243.204-70-3, and 243.204-70-4 for unpriced change orders if the head of the agency determines that the waiver is necessary to support—</P>
                            <P>(1) A contingency operation; or</P>
                            <P>(2) A humanitarian or peacekeeping operation.</P>
                            <CITA>[75 FR 48277, Aug. 10, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>243.204-70-6</SECTNO>
                            <SUBJECT>Allowable profit.</SUBJECT>
                            <P>When the final price of an unpriced change order is negotiated after a substantial portion of the required performance has been completed, the head of the contracting activity shall ensure the profit allowed reflects—</P>
                            <P>(a) Any reduced cost risk to the contractor for costs incurred during contract performance before negotiation of the final price;</P>
                            <P>(b) Any reduced cost risk to the contractor for costs expected to be incurred during performance of the remainder of the contract; and</P>
                            <P>(c) The extent to which costs have been incurred prior to definitization of the unpriced change order (see 215.404-71-3(d)(2)). The risk assessment shall be documented in the price negotiation memorandum .</P>
                            <CITA>[75 FR 48277, Aug. 10, 2010, as amended at 83 FR 30587, June 29, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>243.204-70-7</SECTNO>
                            <SUBJECT>Plans and reports.</SUBJECT>
                            <P>To provide for enhanced management and oversight of unpriced change orders, departments and agencies shall—</P>
                            <P>(a) Include in the Consolidated Undefinitized Contract Action (UCA) Management Plan required by 217.7405, the actions planned and taken to ensure that unpriced change orders are definitized in accordance with this subsection; and</P>
                            <P>(b) Include in the Consolidated UCA Management Report required by 217.7405, each unpriced change order with an estimated value exceeding $5 million.</P>
                            <CITA>[75 FR 48277, Aug. 10, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>243.204-71</SECTNO>
                            <SUBJECT>Certification of requests for equitable adjustment.</SUBJECT>
                            <P>(a) A request for equitable adjustment to contract terms that exceeds the simplified acquisition threshold may not be paid unless the contract certifies the request in accordance with the clause at 252.243-7002.</P>
                            <P>(b) To determine if the dollar threshold for requiring certification is met, add together the absolute value of each cost increase and each cost decrease. See PGI 243.204-71(b) for an example.</P>
                            <P>(c) The certification required by 10 U.S.C. 3862(a), as implemented in the clause at 252.243-7002, is different from the certification required by 41 U.S.C. 7103, Disputes. If the contractor has certified a request for equitable adjustment in accordance with 10 U.S.C. 3862(a), and desires to convert the request to a claim under the Contract Disputes statute, the contractor shall certify the claim in accordance with FAR subpart 33.2.</P>
                            <CITA>[62 FR 37147, July 11, 1997, as amended at 63 FR 11541, Mar. 9, 1998; 70 FR 67922, Nov. 9, 2005; 76 FR 58137, Sept. 20, 2011; 76 FR 76320, Dec. 7, 2011; 77 FR 35881, June 15, 2012; 87 FR 76996, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="399"/>
                            <SECTNO>243.205</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>243.205-70</SECTNO>
                            <SUBJECT>Pricing of contract modifications.</SUBJECT>
                            <P>Use the clause at 252.243-7001, Pricing of Contract Modifications, in solicitations and contracts when anticipating and using a fixed price type contract.</P>
                            <CITA>[56 FR 36446, July 31, 1991. Redesignated at 66 FR 49865, Oct. 1, 2001]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>243.205-71</SECTNO>
                            <SUBJECT>Requests for equitable adjustment.</SUBJECT>
                            <P>Use the clause at 252.243-7002, Requests for Equitable Adjustment, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, that are estimated to exceed the simplified acquisition threshold.</P>
                            <CITA>[63 FR 17124, Apr. 8, 1998. Redesignated at 66 FR 49865, Oct. 1, 2001; 78 FR 37989, June 25, 2013; 88 FR 6588, Jan. 31, 2023; 88 FR 17356, Mar. 22, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>243.205-72</SECTNO>
                            <SUBJECT>Unpriced change orders.</SUBJECT>
                            <P>
                                <E T="03">See</E>
                                 the clause prescriptions at 217.7406 for all unpriced change orders with an estimated value exceeding $5 million.
                            </P>
                            <CITA>[75 FR 48278, Aug. 10, 2010]</CITA>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 244</EAR>
                    <HD SOURCE="HED">PART 244—SUBCONTRACTING POLICIES AND PROCEDURES</HD>
                    <CONTENTS>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 244.1—General</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>244.101</SECTNO>
                            <SUBJECT>Definitions</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 244.2—Consent to Subcontracts</HD>
                            <SECTNO>244.201</SECTNO>
                            <SUBJECT>Consent and advance notification requirements.</SUBJECT>
                            <SECTNO>244.201-1</SECTNO>
                            <SUBJECT>Consent requirements.</SUBJECT>
                            <SECTNO>244.202</SECTNO>
                            <SUBJECT>Contracting officer's evaluation.</SUBJECT>
                            <SECTNO>244.202-2</SECTNO>
                            <SUBJECT>Considerations.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 244.3—Contractors' Purchasing Systems Reviews</HD>
                            <SECTNO>244.301</SECTNO>
                            <SUBJECT>Objective.</SUBJECT>
                            <SECTNO>244.302</SECTNO>
                            <SUBJECT>Requirements.</SUBJECT>
                            <SECTNO>244.303</SECTNO>
                            <SUBJECT>Extent of review.</SUBJECT>
                            <SECTNO>244.305</SECTNO>
                            <SUBJECT>Granting, withholding, or withdrawing approval.</SUBJECT>
                            <SECTNO>244.305-70</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>244.305-71</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 244.4—Subcontracts for Commercial Products, Commercial Services, and Commercial Components</HD>
                            <SECTNO>244.402</SECTNO>
                            <SUBJECT>Policy requirements.</SUBJECT>
                            <SECTNO>244.403</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36447, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 244.1—General</HD>
                        <SECTION>
                            <SECTNO>244.101</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this subpart—</P>
                            <P>
                                <E T="03">Acceptable purchasing system</E>
                                 and 
                                <E T="03">purchasing system</E>
                                 are defined in the clause at 252.244-7001, Contractor Purchasing System Administration.
                            </P>
                            <P>
                                <E T="03">Significant deficiency</E>
                                 is defined in the clause at 252.244-7001, Contractor Purchasing System Administration.
                            </P>
                            <CITA>[76 FR 28871, May 18, 2011]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 244.2—Consent to Subcontracts</HD>
                        <SECTION>
                            <SECTNO>244.201</SECTNO>
                            <SUBJECT>Consent and advance notification requirements.</SUBJECT>
                            <CITA>[78 FR 69272, Nov. 18, 2013]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>244.201-1</SECTNO>
                            <SUBJECT>Consent requirements.</SUBJECT>
                            <P>(a) In accordance with section 824 of the National Defense Authorization Act for Fiscal Year 2019 (Pub. L. 115-232), notwithstanding the requirements in FAR 44.201-1(a), the contracting officer shall not withhold consent to subcontract without the written approval of the program manager, or comparable requiring activity official exercising program management responsibilities, if the contractor has an approved purchasing system, as defined in FAR 44.101.</P>
                            <P>
                                (S-70) In solicitations and contracts for information technology, whether acquired as a service or as a supply, that is a covered system or covered item of supply as those terms are defined at 239.7301, consider the need for a consent to subcontract requirement regarding supply chain risk (see subpart 
                                <PRTPAGE P="400"/>
                                239.73). For additional guidance see PGI 244.201-1.
                            </P>
                            <CITA>[80 FR 67252, Oct. 30, 2015, as amended at 84 FR 12141, Apr. 1, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>244.202</SECTNO>
                            <SUBJECT>Contracting officer's evaluation.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>244.202-2</SECTNO>
                            <SUBJECT>Considerations.</SUBJECT>
                            <P>(a) Where other than lowest price is the basis for subcontractor selection, has the contractor adequately substantiated the selection as offering the greatest value to the Government?</P>
                            <CITA>[60 FR 29501, June 5, 1995]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 244.3—Contractors' Purchasing Systems Reviews</HD>
                        <SECTION>
                            <SECTNO>244.301</SECTNO>
                            <SUBJECT>Objective.</SUBJECT>
                            <P>The administrative contracting officer (ACO) is solely responsible for initiating reviews of the contractor's purchasing systems, but other organizations may request that the ACO initiate such reviews.</P>
                            <CITA>[70 FR 67922, Nov. 9, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>244.302</SECTNO>
                            <SUBJECT>Requirements.</SUBJECT>
                            <P>(a) In lieu of the threshold at FAR 44.302(a), the ACO shall determine the need for a CPSR if a contractor's sales to the Government are expected to exceed $50 million during the next 12 months.</P>
                            <CITA>[84 FR 72249, Dec. 31, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>244.303</SECTNO>
                            <SUBJECT>Extent of review.</SUBJECT>
                            <P>(a) Also review the adequacy of rationale documenting commercial product or commercial service determinations to ensure compliance with the definition of “commercial product” or “commercial service” in FAR 2.101.</P>
                            <P>(b) Also review the adequacy of the contractor's counterfeit electronic part detection and avoidance system under clause 252.246-7007, Contractor Counterfeit Electronic Part Detection and Avoidance System.</P>
                            <CITA>[67 FR 38023, May 31, 2002, as amended at 79 FR 26106, May 6, 2014; 88 FR 6588, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>244.305</SECTNO>
                            <SUBJECT>Granting, withholding, or withdrawing approval.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>244.305-70</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>Use this subsection instead of FAR 44.305-2(c) and 44.305-3(b).</P>
                            <P>(a) The cognizant contracting officer, in consultation with the purchasing system analyst or auditor, shall—</P>
                            <P>(1) Determine the acceptability of the contractor's purchasing system and approve or disapprove the system; and</P>
                            <P>(2) Pursue correction of any deficiencies.</P>
                            <P>(b) In evaluating the acceptability of the contractor's purchasing system, the contracting officer, in consultation with the purchasing system analyst or auditor, shall determine whether the contractor's purchasing system complies with the system criteria for an acceptable purchasing system as prescribed in the clause at 252.244-7001, Contractor Purchasing System Administration.</P>
                            <P>
                                (c) 
                                <E T="03">Disposition of findings</E>
                                —(1) 
                                <E T="03">Reporting of findings.</E>
                                 The purchasing system analyst or auditor shall document findings and recommendations in a report to the contracting officer. If the auditor or purchasing system analyst identifies any significant purchasing system deficiencies, the report shall describe the deficiencies in sufficient detail to allow the contracting officer to understand the deficiencies.
                            </P>
                            <P>
                                (2) 
                                <E T="03">Initial determination.</E>
                                 (i) The contracting officer shall review all findings and recommendations and, if there are no significant deficiencies, shall promptly notify the contractor that the contractor's purchasing system is acceptable and approved; or
                            </P>
                            <P>(ii) If the contracting officer finds that there are one or more significant deficiencies (as defined in the clause at 252.244-7001, Contractor Purchasing System Administration) due to the contractor's failure to meet one or more of the purchasing system criteria in the clause at 252.244-7001, the contracting officer shall—</P>
                            <P>
                                (A) Promptly make an initial written determination on any significant deficiencies and notify the contractor, in writing, providing a description of each significant deficiency in sufficient detail to allow the contractor to understand the deficiency;
                                <PRTPAGE P="401"/>
                            </P>
                            <P>(B) Request the contractor to respond, in writing, to the initial determination within 30 days; and</P>
                            <P>(C) Evaluate the contractor's response to the initial determination in consultation with the auditor or purchasing system analyst, and make a final determination.</P>
                            <P>
                                (3) 
                                <E T="03">Final determination.</E>
                                 (i) The contracting officer shall make a final determination and notify the contractor, in writing, that—
                            </P>
                            <P>(A) The contractor's purchasing system is acceptable and approved, and no significant deficiencies remain, or</P>
                            <P>(B) Significant deficiencies remain. The notice shall identify any remaining significant deficiencies, and indicate the adequacy of any proposed or completed corrective action. The contracting officer shall—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Request that the contractor, within 45 days of receipt of the final determination, either correct the deficiencies or submit an acceptable corrective action plan showing milestones and actions to eliminate the deficiencies;
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Disapprove the system in accordance with the clause at 252.244-7001, Contractor Purchasing System Administration; and
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) Withhold payments in accordance with the clause at 252.242-7005, Contractor Business Systems, if the clause is included in the contract.
                            </P>
                            <P>(ii) Follow the procedures relating to monitoring a contractor's corrective action and the correction of significant deficiencies in PGI 244.305-70.</P>
                            <P>
                                (d) 
                                <E T="03">System approval.</E>
                                 The contracting officer shall promptly approve a previously disapproved purchasing system and notify the contractor when the contracting officer determines that there are no remaining significant deficiencies.
                            </P>
                            <P>
                                (e) 
                                <E T="03">Contracting officer notifications.</E>
                                 The cognizant contracting officer shall promptly distribute copies of a determination to approve a system, disapprove a system and withhold payments, or approve a previously disapproved system and release withheld payments to the auditor; payment office; affected contracting officers at the buying activities; and cognizant contracting officers in contract administration activities.
                            </P>
                            <P>
                                (f) 
                                <E T="03">Mitigating the risk of purchasing system deficiencies on specific proposals.</E>
                            </P>
                            <P>(1) Source selection evaluation teams shall discuss identified purchasing system deficiencies and their impact in all reports on contractor proposals until the deficiencies are resolved.</P>
                            <P>
                                (2) The contracting officer responsible for negotiation of a proposal generated by a purchasing system with an identified deficiency shall evaluate whether the deficiency impacts the negotiations. If it does not, the contracting officer should proceed with negotiations. If it does, the contracting officer should consider other alternatives, 
                                <E T="03">e.g.</E>
                                —
                            </P>
                            <P>(i) Allowing the contractor additional time to correct the purchasing system deficiency and submit a corrected proposal;</P>
                            <P>
                                (ii) Considering another type of contract, 
                                <E T="03">e.g.,</E>
                                 a fixed-price incentive (firm target) contract instead of firm-fixed-price;
                            </P>
                            <P>(iii) Using additional cost analysis techniques to determine the reasonableness of the cost elements affected by the purchasing system's deficiency;</P>
                            <P>(iv) Segregating the questionable areas as a cost-reimbursable line item;</P>
                            <P>(v) Reducing the negotiation objective for profit or fee; or</P>
                            <P>(vi) Including a contract (reopener) clause that provides for adjustment of the contract amount after award.</P>
                            <P>(3) The contracting officer who incorporates a reopener clause into the contract is responsible for negotiating price adjustments required by the clause. Any reopener clause necessitated by a purchasing system deficiency should—</P>
                            <P>(i) Clearly identify the amounts and items that are in question at the time of negotiation;</P>
                            <P>(ii) Indicate a specific time or subsequent event by which the contractor will submit a supplemental proposal, including certified cost or pricing data, identifying the cost impact adjustment necessitated by the deficient purchasing system;</P>
                            <P>(iii) Provide for the contracting officer to adjust the contract price unilaterally if the contractor fails to submit the supplemental proposal; and</P>
                            <P>
                                (iv) Provide that failure of the Government and the contractor to agree to 
                                <PRTPAGE P="402"/>
                                the price adjustment shall be a dispute under the Disputes clause.
                            </P>
                            <CITA>[76 FR 28871, May 18, 2011, as amended at 77 FR 11366, Feb. 24, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>244.305-71</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the Contractor Purchasing System Administration basic clause or its alternate as follows:</P>
                            <P>(a) Use the clause at 252.244-7001, Contractor Purchasing System Administration—Basic, in solicitations and contracts containing the clause at FAR 52.244-2, Subcontracts.</P>
                            <P>(b) Use the clause at 252.244-7001, Contractor Purchasing System Administration—Alternate I, in solicitations and contracts that contain the clause at 252.246-7007, Contractor Counterfeit Electronic Part Detection and Avoidance System, but do not contain FAR 52.244-2, Subcontracts.</P>
                            <CITA>[79 FR 26106, May 6, 2014]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 244.4—Subcontracts for Commercial Products, Commercial Services, and Commercial Components</HD>
                        <SECTION>
                            <SECTNO>244.402</SECTNO>
                            <SUBJECT>Policy requirements.</SUBJECT>
                            <P>(a) Contractors are required to determine whether a particular subcontract item meets the definition of a commercial product or commercial service. This requirement does not affect the contracting officer's responsibilities or determinations made under FAR 15.403-1(c)(3). Contractors are expected to exercise reasonable business judgment in making such determinations, consistent with the guidelines for conducting market research in FAR part 10.</P>
                            <P>(S-70) In accordance with 10 U.S.C. 3457(c), items that are valued at less than $10,000 per item that are purchased by a contractor for use in the performance of multiple contracts with the Department of Defense and other parties and are not identifiable to any particular contract when purchased shall be treated as commercial products, even though the items may not meet the definition of “commercial product” at FAR 2.101 and do not require a commercial item determination.</P>
                            <CITA>[67 FR 38023, May 31, 2002, as amended at 85 FR 60921, Sept. 29, 2020; 87 FR 76996, Dec. 16, 2022; 88 FR 6588, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>244.403</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at 252.244-7000, Subcontracts for Commercial Products and Commercial Services, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services.</P>
                            <CITA>[78 FR 37989, June 25, 2013, as amended at 88 FR 6588, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 245</EAR>
                    <HD SOURCE="HED">PART 245—GOVERNMENT PROPERTY</HD>
                    <CONTENTS>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 245.1—General</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>245.101</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>245.102</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>245.103-70</SECTNO>
                            <SUBJECT>Furnishing Government property to contractors.</SUBJECT>
                            <SECTNO>245.103-71</SECTNO>
                            <SUBJECT>Transferring Government property accountability.</SUBJECT>
                            <SECTNO>245.103-72</SECTNO>
                            <SUBJECT>Government-furnished property attachments to solicitations and awards.</SUBJECT>
                            <SECTNO>245.103-73</SECTNO>
                            <SUBJECT>Government property under sustainment contracts.</SUBJECT>
                            <SECTNO>245.103-74</SECTNO>
                            <SUBJECT>Contracting office responsibilities.</SUBJECT>
                            <SECTNO>245.104</SECTNO>
                            <SUBJECT>Responsibility and liability for Government property.</SUBJECT>
                            <SECTNO>245.105</SECTNO>
                            <SUBJECT>Contractor's property management system compliance.</SUBJECT>
                            <SECTNO>245.107</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 245.2—Solicitation and Evaluation Procedures</HD>
                            <SECTNO>245.201</SECTNO>
                            <SUBJECT>Solicitation.</SUBJECT>
                            <SECTNO>245.201-70</SECTNO>
                            <SUBJECT>Security classification.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 245.3—Authorizing the Use and Rental of Government Property</HD>
                            <SECTNO>245.302</SECTNO>
                            <SUBJECT>Contracts with foreign governments or international organizations.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 245.4—Title to Government Property</HD>
                            <SECTNO>245.402</SECTNO>
                            <SUBJECT>Title to contractor-acquired property.</SUBJECT>
                            <SECTNO>245.402-70</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>245.402-71</SECTNO>
                            <SUBJECT>Delivery of contractor-acquired property.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <PRTPAGE P="403"/>
                            <HD SOURCE="HED">Subpart 245.5—Support Government Property Administration</HD>
                            <SECTNO>245.570</SECTNO>
                            <SUBJECT>Storage at the Government's expense.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 245.6—Reporting, Reutilization, and Disposal</HD>
                            <SECTNO>245.602</SECTNO>
                            <SUBJECT>Reutilization of Government property.</SUBJECT>
                            <SECTNO>245.602-1</SECTNO>
                            <SUBJECT>Inventory disposal schedules.</SUBJECT>
                            <SECTNO>245.602-3</SECTNO>
                            <SUBJECT>Screening.</SUBJECT>
                            <SECTNO>245.602-70</SECTNO>
                            <SUBJECT>Plant clearance procedures.</SUBJECT>
                            <SECTNO>245.604</SECTNO>
                            <SUBJECT>Sale of surplus personal property.</SUBJECT>
                            <SECTNO>245.604-1</SECTNO>
                            <SUBJECT>Sales procedures.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36448, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 245.1—General</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>74 FR 37647, July 29, 2009, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>245.101</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>
                                <E T="03">Mapping, charting, and geodesy property,</E>
                                 as used in this subpart, is defined in the clause at 252.245-7000, Government-Furnished Mapping, Charting, and Geodesy Property.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>245.102</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>See the policy guidance at PGI 245.102-70.</P>
                            <P>
                                (1) 
                                <E T="03">Mapping, charting, and geodesy property.</E>
                                 All Government-furnished mapping, charting, and geodesy (MC&amp;G) property is under the control of the Director, National Geospatial Intelligence Agency.
                            </P>
                            <P>(i) MC&amp;G property shall not be duplicated, copied, or otherwise reproduced for purposes other than those necessary for contract performance.</P>
                            <P>(ii) Upon completion of contract performance, the contracting officer shall—</P>
                            <P>(A) Contact the Director, National Geospatial-Intelligence Agency, 7500 Geoint Drive, Springfield, VA 22150, for disposition instructions;</P>
                            <P>(B) Direct the contractor to destroy or return all Government-furnished MC&amp;G property not consumed during contract performance; and</P>
                            <P>(C) Specify the destination and means of shipment for property to be returned to the Government.</P>
                            <P>
                                (2) 
                                <E T="03">Government supply sources.</E>
                                 When a contractor will be responsible for preparing requisitioning documentation to acquire Government-furnished property (GFP) from Government supply sources, include in the contract the requirement to prepare the documentation in accordance with DLM 4000.25, Defense Logistics Management Standards (DLMS), Volume 2, Supply Standards and Procedures. Copies are available from the address cited at PGI 251.102.
                            </P>
                            <P>
                                (3) 
                                <E T="03">Acquisition and management of industrial resources.</E>
                                 See Subpart 237.75 for policy relating to facilities projects.
                            </P>
                            <P>
                                (4) 
                                <E T="03">GFP identification.</E>
                            </P>
                            <P>(i) It is DoD policy that GFP be tagged, labeled, or marked based on DoD marking standards (MIL Standard 130) or other standards, when the requiring activity determines that such items are subject to serialized item management (serially-managed items). The list of Government-furnished property subject to serialized item management will be identified in the contract in accordance with PGI 245.103-72, Government-furnished property attachments to solicitations and awards.</P>
                            <P>
                                (ii) 
                                <E T="03">Exceptions.</E>
                                 The Contractor will not be required to tag, label, or mark—
                            </P>
                            <P>(A) GFP that was previously tagged, labeled, or marked;</P>
                            <P>(B) Items, as determined by the head of the agency, that are to be used to support a contingency operation; or to facilitate defense against or recovery from nuclear, biological, chemical, or radiological attack;</P>
                            <P>(C) Items for which a determination and findings has been executed concluding that it is more cost effective for the Government requiring activity to assign, mark, and register the unique item identification after delivery of an item acquired from a small business concern or a commercial product acquired under FAR part 12 or part 8.</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) The determination and findings shall be executed by—
                            </P>
                            <P>
                                (
                                <E T="03">i</E>
                                ) The Component Acquisition Executive for an Acquisition Category (ACAT) I program; or
                            </P>
                            <P>
                                (
                                <E T="03">ii</E>
                                ) The head of the contracting activity for all other programs.
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) A copy of the executed determination and findings shall be provided to 
                                <PRTPAGE P="404"/>
                                the Office of the Principal Director, Defense Pricing, Contracting, and Acquisition Policy (DPC) (Contracting eBusiness) via email at 
                                <E T="03">osd.pentagon.ousd-a-s.mbx.dpc-cb@mail.mil.</E>
                            </P>
                            <P>(D) Items that are contractor-acquired property;</P>
                            <P>(E) Property under any statutory leasing authority;</P>
                            <P>(F) Property to which the Government has acquired a lien or title solely because of partial, advance, progress, or performance-based payments;</P>
                            <P>(G) Intellectual property or software; or</P>
                            <P>(H) Real property.</P>
                            <P>
                                (5) 
                                <E T="03">Reporting Government property.</E>
                                 It is DoD policy that all Government property be reported in the GFP module or Wide Area WorkFlow module of the Procurement Integrated Enterprise Environment (PIEE) as required by the clause at 252.245-7005, Management and Reporting of Government Property.
                            </P>
                            <CITA>[74 FR 37647, July 29, 2009, as amended at 76 FR 3537, Jan. 20, 2011; 76 FR 6006, 6008, Feb. 2, 2011; 80 FR 2021, Jan. 15, 2015; 81 FR 36473, June 7, 2016; 86 FR 3839, Jan. 15, 2021; 88 FR 6588, Jan. 31, 2023; 88 FR 88537, Dec. 22, 2023; 89 FR 11748, Feb. 15, 2024; 89 FR 60832, July 29, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>245.103-70</SECTNO>
                            <SUBJECT>Furnishing Government property to contractors.</SUBJECT>
                            <P>Follow the procedures at PGI 245.103-70 for furnishing Government property to contractors.</P>
                            <CITA>[76 FR 3537, Jan. 20, 2011. Redesignated and amended at 77 FR 76937, Dec. 31, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>245.103-71</SECTNO>
                            <SUBJECT>Transferring Government property accountability.</SUBJECT>
                            <P>Follow the procedures at PGI 245.103-71 for transferring Government property accountability.</P>
                            <CITA>[76 FR 3537, Jan. 20, 2011. Redesignated and amended at 77 FR 76937, Dec. 31, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>245.103-72</SECTNO>
                            <SUBJECT>Government-furnished property attachments to solicitations and awards.</SUBJECT>
                            <P>When performance will require the use of GFP, contracting officers shall include the GFP attachment to solicitations and awards. See PGI 245.103-72 for links to the formats and procedures for preparing the GFP attachment.</P>
                            <CITA>[88 FR 88537, Dec. 22, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>245.103-73</SECTNO>
                            <SUBJECT>Government property under sustainment contracts.</SUBJECT>
                            <P>See PGI 245.103-73 for information on the reporting requirements for Government inventory held by contractors under sustainment contracts in accordance with DoD Manual 4140.01, Volume 6, DoD Supply Chain Materiel Management Procedures: Materiel Returns, Retention, and Disposition.</P>
                            <CITA>[82 FR 61481, Dec. 28, 2017]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>245.103-74</SECTNO>
                            <SUBJECT>Contracting office responsibilities.</SUBJECT>
                            <P>
                                See 
                                <E T="03">PGI 245.103-74</E>
                                 for contracting office responsibilities.
                            </P>
                            <CITA>[77 FR 76937, Dec. 31, 2012. Redesignated at 82 FR 61481, Dec. 28, 2017; 83 FR 12681, Mar. 23, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>245.104</SECTNO>
                            <SUBJECT>Responsibility and liability for Government property.</SUBJECT>
                            <P>In addition to the contract types listed at FAR 45.104, contractors are not held liable for loss of Government property under negotiated fixed-price contracts awarded on a basis other than submission of certified cost or pricing data.</P>
                            <CITA>[76 FR 71826, Nov. 18, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>245.105</SECTNO>
                            <SUBJECT>Contractors' property management system compliance.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Definitions</E>
                                —
                            </P>
                            <P>
                                (1) 
                                <E T="03">Acceptable property management system</E>
                                 and 
                                <E T="03">property management system</E>
                                 are defined in the clause at 252.245-7003, Contractor Property Management System Administration.
                            </P>
                            <P>
                                (2) 
                                <E T="03">Significant deficiency</E>
                                 is defined in the clause at 252.245-7003, Contractor Property Management System Administration.
                            </P>
                            <P>
                                (b) 
                                <E T="03">Policy.</E>
                                 The cognizant contracting officer, in consultation with the property administrator, shall—
                            </P>
                            <P>(1) Determine the acceptability of the system and approve or disapprove the system; and</P>
                            <P>(2) Pursue correction of any deficiencies.</P>
                            <P>
                                (c) In evaluating the acceptability of a contractor's property management system, the contracting officer, in consultation with the property administrator, shall determine whether the contractor's property management system complies with the system criteria 
                                <PRTPAGE P="405"/>
                                for an acceptable property management system as prescribed in the clause at 252.245-7003, Contractor Property Management System Administration.
                            </P>
                            <P>
                                (d) 
                                <E T="03">Disposition of findings</E>
                                —(1) 
                                <E T="03">Reporting of findings.</E>
                                 The property administrator shall document findings and recommendations in a report to the contracting officer. If the property administrator identifies any significant property system deficiencies, the report shall describe the deficiencies in sufficient detail to allow the contracting officer to understand the deficiencies.
                            </P>
                            <P>
                                (2) 
                                <E T="03">Initial determination.</E>
                                 (i) The contracting officer shall review findings and recommendations and, if there are no significant deficiencies, shall promptly notify the contractor, in writing, that the contractor's property management system is acceptable and approved; or
                            </P>
                            <P>(ii) If the contracting officer finds that there are one or more significant deficiencies (as defined in the clause at 252.245-7003, Contractor Property Management System Administration) due to the contractor's failure to meet one or more of the property management system criteria in the clause at 252.245-7003, the contracting officer shall—</P>
                            <P>(A) Promptly make an initial written determination on any significant deficiencies and notify the contractor, in writing, providing a description of each significant deficiency in sufficient detail to allow the contractor to understand the deficiency;</P>
                            <P>(B) Request the contractor to respond, in writing, to the initial determination within 30 days and;</P>
                            <P>(C) Evaluate the contractor's response to the initial determination, in consultation with the property administrator, and make a final determination.</P>
                            <P>
                                (3) 
                                <E T="03">Final determination.</E>
                                 (i) The contracting officer shall make a final determination and notify the contractor, in writing, that—
                            </P>
                            <P>(A) The contractor's property management system is acceptable and approved, and no significant deficiencies remain, or</P>
                            <P>(B) Significant deficiencies remain. The notice shall identify any remaining significant deficiencies, and indicate the adequacy of any proposed or completed corrective action. The contracting officer shall—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Request that the contractor, within 45 days of receipt of the final determination, either correct the deficiencies or submit an acceptable corrective action plan showing milestones and actions to eliminate the deficiencies;
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Disapprove the system in accordance with the clause at 252.245-7003, Contractor Property Management System Administration; and
                            </P>
                            <P>
                                (
                                <E T="03">3</E>
                                ) Withhold payments in accordance with the clause at 252.242-7005, Contractor Business Systems, if the clause is included in the contract.
                            </P>
                            <P>(ii) Follow the procedures relating to monitoring a contractor's corrective action and the correction of significant deficiencies in PGI 245.105.</P>
                            <P>
                                (e) 
                                <E T="03">System approval.</E>
                                 The contracting officer shall promptly approve a previously disapproved property management system and notify the contractor when the contracting officer determines, in consultation with the property administrator, that there are no remaining significant deficiencies.
                            </P>
                            <P>
                                (f) 
                                <E T="03">Contracting officer notifications.</E>
                                 The cognizant contracting officer shall promptly distribute copies of a determination to approve a system, disapprove a system and withhold payments, or approve a previously disapproved system and release withheld payments to the auditor; payment office; affected contracting officers at the buying activities; and cognizant contracting officers in contract administration activities.
                            </P>
                            <CITA>[76 FR 28872, May 18, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>245.107</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>(1)(i) In lieu of the prescription at FAR 45.107(d), use the clause at FAR 52.245-1, Government Property, in all purchase orders for repair, maintenance, overhaul, or modification of Government property regardless of the unit acquisition cost of the items to be repaired.</P>
                            <P>
                                (ii) For negotiated fixed-price contracts awarded on a basis other than submission of certified cost or pricing data for which Government property is provided, use the clause at FAR 52.245-1, Government Property, without its Alternate I.
                                <PRTPAGE P="406"/>
                            </P>
                            <P>(2) Use the clause at 252.245-7000, Government-Furnished Mapping, Charting, and Geodesy Property, in solicitations and contracts when mapping, charting, and geodesy property is to be furnished.</P>
                            <P>(3) Use the clause at 252.245-7003, Contractor Property Management System Administration, in solicitations and contracts containing the clause at FAR 52.245-1, Government Property.</P>
                            <P>(4) Use the clause at 252.245-7005, Management and Reporting of Government Property, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, that contain the clause at FAR 52.245-1, Government Property.</P>
                            <CITA>[76 FR 6006, 6008, Feb. 2, 2011, as amended at 76 FR 28872, May 18, 2011; 76 FR 52142, Aug. 19, 2011; 76 FR 71826, Nov. 18, 2011; 84 FR 18162, Apr. 30, 2019; 88 FR 88537, Dec. 22, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 245.2—Solicitation and Evaluation Procedures</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>76 FR 3537, Jan. 20, 2011, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>245.201</SECTNO>
                            <SUBJECT>Solicitation.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>245.201-70</SECTNO>
                            <SUBJECT>Security classification.</SUBJECT>
                            <P>Follow the procedures at PGI 245.201-70 for security classification.</P>
                            <CITA>[88 FR 88537, Dec. 22, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 245.3—Authorizing the Use and Rental of Government Property</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>74 FR 37647, July 29, 2009, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>245.302</SECTNO>
                            <SUBJECT>Contracts with foreign governments or international organizations.</SUBJECT>
                            <P>
                                (1) 
                                <E T="03">General.</E>
                            </P>
                            <P>
                                (i) 
                                <E T="03">Approval.</E>
                                 A contractor may use Government property on work for foreign governments and international organizations only when approved in writing by the contracting officer having cognizance of the property. The contracting officer may grant approval, provided—
                            </P>
                            <P>(A) The use will not interfere with foreseeable requirements of the United States;</P>
                            <P>(B) The work is undertaken as a DoD foreign military sale; or</P>
                            <P>(C) For a direct commercial sale, the foreign country or international organization would be authorized to contract with the department concerned under the Arms Export Control Act.</P>
                            <P>
                                (ii) 
                                <E T="03">Use charges.</E>
                            </P>
                            <P>(A) The Use and Charges clause is applicable on direct commercial sales to foreign governments or international organizations.</P>
                            <P>(B) When a particular foreign government or international organization has funded the acquisition of property, do not assess the foreign government or international organization rental charges or nonrecurring recoupments for the use of such property.</P>
                            <P>
                                (2) 
                                <E T="03">Special tooling and special test equipment.</E>
                            </P>
                            <P>(i) DoD normally recovers a fair share of nonrecurring costs of special tooling and special test equipment by including these costs in its calculation of the nonrecurring cost recoupment charge when major defense equipment is sold by foreign military sales or direct commercial sales to foreign governments or international organizations. “Major defense equipment” is defined in DoD Directive 2140.2, Recoupment of Nonrecurring Costs on Sales of U.S. Items, as any item of significant military equipment on the United States Munitions List having a nonrecurring research, development, test, and evaluation cost of more than $50 million or a total production cost of more than $200 million.</P>
                            <P>(ii) When the cost thresholds in paragraph (2)(i) of this section are not met, the contracting officer shall assess rental charges for use of special tooling and special test equipment pursuant to the Use and Charges clause if administratively practicable.</P>
                            <P>
                                (3) 
                                <E T="03">Waivers.</E>
                            </P>
                            <P>
                                (i) Rental charges for use of U.S. production and research property on commercial sales transactions to the Government of Canada are waived for all commercial contracts. This waiver is based on an understanding wherein the Government of Canada has agreed to waive its rental charges.
                                <PRTPAGE P="407"/>
                            </P>
                            <P>(ii) Requests for waiver or reduction of charges for the use of Government property on work for foreign governments or international organizations shall be submitted to the contracting officer, who is authorized to approve the requests in consultation with the appropriate functional specialist.</P>
                            <CITA>[74 FR 37647, July 29, 2009, as amended at 78 FR 65220, Oct. 31, 2013]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 245.4—Title to Government Property</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>76 FR 3537, Jan. 20, 2011, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>245.402</SECTNO>
                            <SUBJECT>Title to contractor-acquired property.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>245.402-70</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>Review the guidance at PGI 245.402-70 with regard to oversight and surveillance of contractor-acquired property.</P>
                            <CITA>[81 FR 50652, Aug. 2, 2016]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>245.402-71</SECTNO>
                            <SUBJECT>Delivery of contractor-acquired property.</SUBJECT>
                            <P>Follow the procedures at PGI 245.402-71 for the delivery of contractor-acquired property.</P>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 245.5—Support Government Property Administration</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>76 FR 52142, Aug. 19, 2011, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>245.570</SECTNO>
                            <SUBJECT>Storage at the Government's expense.</SUBJECT>
                            <P>All storage contracts or agreements shall be separately priced and shall include all costs associated with the storage.</P>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 245.6—Reporting, Reutilization, and Disposal</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>76 FR 52142, Aug. 19, 2011, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>245.602</SECTNO>
                            <SUBJECT>Reutilization of Government property.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>245.602-1</SECTNO>
                            <SUBJECT>Inventory disposal schedules.</SUBJECT>
                            <P>For termination inventory, plant clearance officers shall verify inventory schedules, either directly or through appropriate technical personnel, to determine the following:</P>
                            <P>
                                (a) 
                                <E T="03">Allocability.</E>
                            </P>
                            <P>(1) Review contract requirements, delivery schedules, bills of material, and other pertinent documents to determine whether schedules include property that—</P>
                            <P>(i) Is appropriate for use on the contract; or</P>
                            <P>(ii) Exceeds the quantity required for completion of the contract, but could be diverted to other commercial work or Government use.</P>
                            <P>(2) Review the contractor's—</P>
                            <P>(i) Recent purchases of similar material;</P>
                            <P>(ii) Plans for current and scheduled production;</P>
                            <P>(iii) Stock record entries; and</P>
                            <P>(iv) Bills of material for similar items.</P>
                            <P>
                                (b) 
                                <E T="03">Quantity.</E>
                                 Take measures to provide assurance that available inventory is in accordance with quantities listed on the inventory schedules. Quantities may be verified by actual item count, acceptance of labeled quantities in unopened/sealed packages, scale counts, or other appropriate methods.
                            </P>
                            <P>
                                (c) 
                                <E T="03">Condition.</E>
                                 Ensure that the physical condition of the property is reasonably consistent with the Federal Condition Code supplied by the contractor.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>245.602-3</SECTNO>
                            <SUBJECT>Screening.</SUBJECT>
                            <P>Property will be screened DoD-wide, including the contracting agency, requiring agency, and, as appropriate, the General Services Administration. The requiring agency shall have priority for retention of listed items. All required screening must be completed before any sale of contractor inventory, including contractor inventory in overseas locations (foreign excess personal property) can take place. Upon request of the prospective reutilization, transfer, donation, or sales customer, the plant clearance officer shall arrange for inspection of property at the contractor's plant in such a manner as to avoid interruption of the contractor's operations, and consistent with any security requirements.</P>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="408"/>
                            <SECTNO>245.602-70</SECTNO>
                            <SUBJECT>Plant clearance procedures.</SUBJECT>
                            <P>Follow the procedures at PGI 245.602-70 for establishing and processing a plant clearance case.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>245.604</SECTNO>
                            <SUBJECT>Sale of surplus personal property.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>245.604-1</SECTNO>
                            <SUBJECT>Sales procedures.</SUBJECT>
                            <P>
                                (1) 
                                <E T="03">Best value sales approach.</E>
                                 Plant clearance officers shall determine a best value sales approach, to include due consideration for costs, risks, and benefits, 
                                <E T="03">e.g.,</E>
                                 potential sales proceeds.
                            </P>
                            <P>
                                (2) 
                                <E T="03">Invitation for bid procedures.</E>
                                 The plant clearance officer may direct the contractor to issue informal invitations for bid (orally, telephonically, or by other informal media), provided—
                            </P>
                            <P>(i) Maximum practical competition is obtained;</P>
                            <P>(ii) Sources solicited are recorded; and</P>
                            <P>(iii) Informal bids are confirmed in writing.</P>
                            <P>
                                (3) 
                                <E T="03">Sale approval and award.</E>
                                 Plant clearance officers shall—
                            </P>
                            <P>(i) Evaluate bids to establish that the sale price is fair and reasonable, taking into consideration—</P>
                            <P>(A) Knowledge or tests of the market;</P>
                            <P>(B) Current published prices for the property;</P>
                            <P>(C) The nature, condition, quantity, and location of the property; and</P>
                            <P>(D) Past sale history for like or similar items;</P>
                            <P>(ii) Approve award to the responsible bidder whose bid is most advantageous to the Government. The plant clearance officer shall not approve award to any bidder who is an ineligible transferee, as defined in 252.245-7005, Management and Reporting of Government Property; and</P>
                            <P>(iii) Notify the contractor of the bidder to whom an award will be made within 5 working days from receipt of bids.</P>
                            <P>
                                (4) 
                                <E T="03">Negotiated sales.</E>
                            </P>
                            <P>(i) Negotiated sales include purchases or retention at less than cost by the contractor. Negotiated sales may be made when—</P>
                            <P>(A) The plant clearance officer determines that this method is essential to expeditious plant clearance; and</P>
                            <P>(B) The Government's interests are adequately protected.</P>
                            <P>(ii) Negotiated sales shall be at fair and reasonable prices, not less than those reasonably expected under competitive sales.</P>
                            <P>(iii) Conditions justifying negotiated sales are—</P>
                            <P>(A) No acceptable bids are received under competitive sale;</P>
                            <P>(B) Anticipated sales proceeds do not warrant competitive sale;</P>
                            <P>(C) Specialized nature of the property would not create bidder interest;</P>
                            <P>(D) Removal of the property would reduce its value or result in disproportionate handling expenses; or</P>
                            <P>(E) Such action is essential to the Government's interests.</P>
                            <P>
                                (5) Plant clearance officers shall consider any special disposal requirements such as demilitarization or trade security control requirements in accordance with DoDM 4160.28-M, Defense Demilitarization Manual, and DoDI 2030.08, Implementation of Trade Security Controls (TSCs) for Transfers of DoD Personal Property to Parties Outside DoD Control, respectively. 
                                <E T="03">See</E>
                                 PGI 245.6.
                            </P>
                            <CITA>[86 FR 59871, Oct. 29, 2021, as amended at 88 FR 88537, Dec. 22, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 246</EAR>
                    <HD SOURCE="HED">PART 246—QUALITY ASSURANCE</HD>
                    <CONTENTS>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 246.1—General</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>246.101</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>246.102</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>246.103</SECTNO>
                            <SUBJECT>Contracting office responsibilities.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 246.2—Contract Quality Requirements</HD>
                            <SECTNO>246.202</SECTNO>
                            <SUBJECT>Types of contract quality requirements.</SUBJECT>
                            <SECTNO>246.202-4</SECTNO>
                            <SUBJECT>Higher-level contract quality requirements.</SUBJECT>
                            <SECTNO>246.270</SECTNO>
                            <SUBJECT>Safety of facilities, infrastructure, and equipment for military operations.</SUBJECT>
                            <SECTNO>246.270-1</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>246.270-2</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>246.270-3</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <SECTNO>246.270-4</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 246.3—Contract Clauses</HD>
                            <SECTNO>246.370</SECTNO>
                            <SUBJECT>Notification of potential safety issues.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <PRTPAGE P="409"/>
                            <HD SOURCE="HED">Subpart 246.4—Government Contract Quality Assurance</HD>
                            <SECTNO>246.401</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>246.402</SECTNO>
                            <SUBJECT>Government contract quality assurance at source.</SUBJECT>
                            <SECTNO>246.404</SECTNO>
                            <SUBJECT>Government contract quality assurance for acquisitions at or below the simplified acquisition threshold.</SUBJECT>
                            <SECTNO>246.406</SECTNO>
                            <SUBJECT>Foreign governments.</SUBJECT>
                            <SECTNO>246.407</SECTNO>
                            <SUBJECT>Nonconforming supplies or services.</SUBJECT>
                            <SECTNO>246.408</SECTNO>
                            <SUBJECT>Single-agency assignments of Government contract quality assurance.</SUBJECT>
                            <SECTNO>246.408-70</SECTNO>
                            <SUBJECT>Subsistence.</SUBJECT>
                            <SECTNO>246.408-71</SECTNO>
                            <SUBJECT>Aircraft.</SUBJECT>
                            <SECTNO>246.470</SECTNO>
                            <SUBJECT>Government contract quality assurance actions.</SUBJECT>
                            <SECTNO>246.470-1</SECTNO>
                            <SUBJECT>Assessment of additional costs.</SUBJECT>
                            <SECTNO>246.470-2</SECTNO>
                            <SUBJECT>Quality evaluation data.</SUBJECT>
                            <SECTNO>246.471</SECTNO>
                            <SUBJECT>Authorizing shipment of supplies.</SUBJECT>
                            <SECTNO>246.472</SECTNO>
                            <SUBJECT>Inspection stamping.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 246.5—Acceptance</HD>
                            <SECTNO>246.504</SECTNO>
                            <SUBJECT>Certificate of conformance.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 246.6—Material Inspection and Receiving Reports</HD>
                            <SECTNO>246.601</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 246.7—Warranties</HD>
                            <SECTNO>246.702</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>246.702-70</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>246.704</SECTNO>
                            <SUBJECT>Authority for use of warranties.</SUBJECT>
                            <SECTNO>246.705</SECTNO>
                            <SUBJECT>Limitations.</SUBJECT>
                            <SECTNO>246.706</SECTNO>
                            <SUBJECT>Warranty terms and conditions.</SUBJECT>
                            <SECTNO>246.708</SECTNO>
                            <SUBJECT>Warranties of data.</SUBJECT>
                            <SECTNO>246.710</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <SECTNO>246.710-70</SECTNO>
                            <SUBJECT>Warranty attachments.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 246.8—Contractor Liability for Loss of or Damage to Property of the Government</HD>
                            <SECTNO>246.870</SECTNO>
                            <SUBJECT>Contractor counterfeit electronic part detection and avoidance.</SUBJECT>
                            <SECTNO>246.870-0</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>246.870-1</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <SECTNO>246.870-2</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>246.870-3</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36460, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 246.1—General</HD>
                        <SECTION>
                            <SECTNO>246.101</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>
                                <E T="03">Discipline Working Group,</E>
                                 as used in this subpart, is defined in the clause at 252.246-7004, Safety of Facilities, Infrastructure, and Equipment for Military Operations.
                            </P>
                            <CITA>[75 FR 66685, Oct. 29, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>246.102</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>Departments and agencies shall also—</P>
                            <P>(1) Develop and manage a systematic, cost-effective Government contract quality assurance program to ensure that contract performance conforms to specified requirements. Apply Government quality assurance to all contracts for services and products designed, developed, purchased, produced, stored, distributed, operated, maintained, or disposed of by contractors.</P>
                            <P>(2) Conduct quality audits to ensure the quality of products and services meet contractual requirements.</P>
                            <P>(3) Base the type and extent of Government contract quality assurance actions on the particular acquisition.</P>
                            <P>(4) Provide contractors the maximum flexibility in establishing efficient and effective quality programs to meet contractual requirements. Contractor quality programs may be modeled on military, commercial, national, or international quality standards.</P>
                            <CITA>[56 FR 36460, July 31, 1991, as amended at 60 FR 33145, June 27, 1995; 71 FR 27646, May 12, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>246.103</SECTNO>
                            <SUBJECT>Contracting office responsibilities.</SUBJECT>
                            <P>(1) The contracting office must coordinate with the quality assurance activity before changing any quality requirement.</P>
                            <P>(2) The activity responsible for technical requirements may prepare instructions covering the type and extent of Government inspections for acquisitions that are complex, have critical applications, or have unusual requirements. Follow the procedures at PGI 246.103(2) for preparation of instructions.</P>
                            <CITA>[71 FR 27647, May 12, 2006]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <PRTPAGE P="410"/>
                        <HD SOURCE="HED">Subpart 246.2—Contract Quality Requirements</HD>
                        <SECTION>
                            <SECTNO>246.202</SECTNO>
                            <SUBJECT>Types of contract quality requirements.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>246.202-4</SECTNO>
                            <SUBJECT>Higher-level contract quality requirements.</SUBJECT>
                            <P>(1) Higher-level contract quality requirements are used in addition to a standard inspection requirement.</P>
                            <P>(2) Higher-level contract quality requirements, including nongovernment quality system standards adopted to meet DoD needs, are listed in the DoD Index of Specifications and Standards.</P>
                            <CITA>[60 FR 33145, June 27, 1995. Redesignated and amended at 60 FR 61599, Nov. 30, 1995]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>246.270</SECTNO>
                            <SUBJECT>Safety of facilities, infrastructure, and equipment for military operations.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>246.270-1</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>This section implements section 807 of the National Defense Authorization Act for Fiscal Year 2010 (Pub. L. 111-84). It establishes policies and procedures intended to ensure the safety and habitability of facilities, infrastructure, and equipment acquired for use by DoD military or civilian personnel during military operations performed outside the United States, Guam, Puerto Rico, and the Virgin Islands.</P>
                            <CITA>[75 FR 66685, Oct. 29, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>246.270-2</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(a) Contracts (including task and delivery orders) for the construction, installation, repair, maintenance, or operation of facilities, infrastructure, and equipment configured for occupancy, including but not limited to, existing host nation facilities, new construction, and relocatable buildings acquired for use by DoD military or civilian personnel, shall require a pre-occupancy safety and habitability inspection.</P>
                            <P>(b) To minimize safety and health risks, each contract covered by this policy shall require the contractor's compliance with the Unified Facilities Criteria (UFC) 1-200-01 and its referenced standards for—</P>
                            <P>(1) Fire protection;</P>
                            <P>(2) Structural integrity;</P>
                            <P>(3) Electrical systems;</P>
                            <P>(4) Plumbing;</P>
                            <P>(5) Water treatment;</P>
                            <P>(6) Waste disposal; and</P>
                            <P>(7) Telecommunications networks.</P>
                            <P>(c) Existing host nation facilities constructed to standards equivalent to or more stringent than UFC 1-200-01 are acceptable upon a written determination of the acceptability of the standards by the Discipline Working Group.</P>
                            <P>(d) Inspections to ensure compliance with UFC 1-200-01 standards shall be conducted in accordance with the inspection clause of the contract.</P>
                            <CITA>[75 FR 66685, Oct. 29, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>246.270-3</SECTNO>
                            <SUBJECT>Exceptions.</SUBJECT>
                            <P>The combatant commander may waive compliance with the foregoing standards when it is impracticable to comply with such standards under prevailing operational conditions.</P>
                            <CITA>[75 FR 66685, Oct. 29, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>246.270-4</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at 252.246-7004, Safety of Facilities, Infrastructure, and Equipment for Military Operations, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, for the construction, installation, repair, maintenance, or operation of facilities, infrastructure, or for equipment configured for occupancy, planned for use by DoD military or civilian personnel during military operations.</P>
                            <CITA>[75 FR 66685, Oct. 29, 2010, as amended at 78 FR 37989, June 25, 2013; 88 FR 6588, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 246.3—Contract Clauses</HD>
                        <SECTION>
                            <SECTNO>246.370</SECTNO>
                            <SUBJECT>Notification of potential safety issues.</SUBJECT>
                            <P>(a) Use the clause at 252.246-7003, Notification of Potential Safety Issues, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, for the acquisition of—</P>
                            <P>
                                (1) Repairable or consumable parts identified as critical safety items;
                                <PRTPAGE P="411"/>
                            </P>
                            <P>(2) Systems and subsystems, assemblies, and subassemblies integral to a system; or</P>
                            <P>(3) Repair, maintenance, logistics support, or overhaul services for systems and subsystems, assemblies, subassemblies, and parts integral to a system.</P>
                            <P>(b) Follow the procedures at PGI 246.370 for the handling of notifications received under the clause at 252.246-7003.</P>
                            <CITA>[72 FR 2636, Jan. 22, 2007, as amended at 78 FR 37989, June 25, 2013. Redesignated and amended at 83 FR 66064, Dec. 21, 2018; 88 FR 6588, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 246.4—Government Contract Quality Assurance</HD>
                        <SECTION>
                            <SECTNO>246.401</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>The requirement for a quality assurance surveillance plan shall be addressed and documented in the contract file for each contract except for those awarded using simplified acquisition procedures. For contracts for services, the contracting officer should prepare a quality assurance surveillance plan to facilitate assessment of contractor performance, see 237.172. For contracts for supplies, the contracting officer should address the need for a quality assurance surveillance plan.</P>
                            <CITA>[75 FR 22706, Apr. 30, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>246.402</SECTNO>
                            <SUBJECT>Government contract quality assurance at source.</SUBJECT>
                            <P>Do not require Government contract quality assurance at source for contracts or delivery orders valued below $350,000, unless—</P>
                            <P>(1) Mandated by DoD regulation;</P>
                            <P>(2) Required by a memorandum of agreement between the acquiring department or agency and the contract administration agency; or</P>
                            <P>(3) The contracting officer determines that—</P>
                            <P>
                                (i) Contract technical requirements are significant (
                                <E T="03">e.g.</E>
                                , the technical requirements include drawings, test procedures, or performance requirements);
                            </P>
                            <P>(ii) The product being acquired—</P>
                            <P>(A) Has critical characteristics;</P>
                            <P>(B) Has specific features identified that make Government contract quality assurance at source necessary; or</P>
                            <P>(C) Has specific acquisition concerns identified that make Government contract quality assurance at source necessary; and</P>
                            <P>(iii) The contract is being awarded to—</P>
                            <P>(A) A manufacturer or producer; or</P>
                            <P>(B) A non-manufacturer or non-producer and specific Government verifications have been identified as necessary and feasible to perform.</P>
                            <CITA>[70 FR 8543, Feb. 22, 2005, as amended at 75 FR 45074, Aug. 2, 2010; 85 FR 61504, Sept. 29, 2020]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>246.404</SECTNO>
                            <SUBJECT>Government contract quality assurance for acquisitions at or below the simplified acquisition threshold.</SUBJECT>
                            <P>Do not require Government contract quality assurance at source for contracts or delivery orders valued at or below the simplified acquisition threshold unless the criteria at 246.402 have been met.</P>
                            <CITA>[70 FR 8543, Feb. 22, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>246.406</SECTNO>
                            <SUBJECT>Foreign governments.</SUBJECT>
                            <P>
                                (1) 
                                <E T="03">Quality assurance among North Atlantic Treaty Organization (NATO) countries.</E>
                                 (i) NATO Standardization Agreement (STANAG) 4107, Mutual Acceptance of Government Quality Assurance and Usage of the Allied Quality Assurance Publications—
                            </P>
                            <P>(A) Contains the processes, procedures, terms, and conditions under which one NATO member nation will perform quality assurance for another NATO member nation or NATO organization;</P>
                            <P>(B) Standardizes the development, updating, and application of the Allied Quality Assurance Publications; and</P>
                            <P>(C) Has been ratified by the United States and other nations in NATO with certain reservations identified in STANAG 4107.</P>
                            <P>(ii) Departments and agencies shall follow STANAG 4107 when—</P>
                            <P>(A) Asking a NATO member nation to perform quality assurance; or</P>
                            <P>(B) Performing quality assurance when requested by a NATO member nation or NATO organization.</P>
                            <P>
                                (2) 
                                <E T="03">International military sales (non-NATO).</E>
                                 Departments and agencies shall—
                                <PRTPAGE P="412"/>
                            </P>
                            <P>(i) Perform quality assurance services on international military sales contracts or in accordance with existing agreements;</P>
                            <P>(ii) Inform host or U.S. Government personnel and contractors on the use of quality assurance publications; and</P>
                            <P>(iii) Delegate quality assurance to the host government when satisfactory services are available.</P>
                            <P>
                                (3) 
                                <E T="03">Reciprocal quality assurance agreements.</E>
                                 A Memorandum of Understanding (MOU) with a foreign country may contain an annex that provides for the reciprocal performance of quality assurance services. MOUs should be checked to determine whether such an annex exists for the country where a defense contract will be performed. (See subpart 225.8 for more information about MOUs.)
                            </P>
                            <CITA>[56 FR 36460, July 31, 1991, as amended at 63 FR 43890, Aug. 17, 1998; 63 FR 47439, Sept. 8, 1998; 71 FR 27647, May 12, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>246.407</SECTNO>
                            <SUBJECT>Nonconforming supplies or services.</SUBJECT>
                            <P>(f) If nonconforming material or services are discovered after acceptance, the defect appears to be the fault of the contractor, any warranty has expired, and there are no other contractual remedies, the contracting officer—</P>
                            <P>(i) Shall notify the contractor in writing of the nonconforming material or service;</P>
                            <P>(ii) Shall request that the contractor repair or replace the material, or perform the service, at no cost to the Government; and</P>
                            <P>(iii) May accept consideration if offered. For guidance on solicitation of a refund, see subpart 242.71.</P>
                            <P>(S-70) The head of the design control activity is the approval authority for acceptance of any nonconforming aviation or ship critical safety items or nonconforming modification, repair, or overhaul of such items (see 209.270). Authority for acceptance of minor nonconformances in aviation or ship critical safety items may be delegated as determined appropriate by the design control activity. See additional information at PGI 246.407.</P>
                            <CITA>[56 FR 36460, July 31, 1991, as amended at 67 FR 4208, Jan. 29, 2002; 69 FR 55989, Sept. 17, 2004; 70 FR 57190, Sept. 30, 2005; 73 FR 1828, Jan. 10, 2008]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>246.408</SECTNO>
                            <SUBJECT>Single-agency assignments of Government contract quality assurance.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>246.408-70</SECTNO>
                            <SUBJECT>Subsistence.</SUBJECT>
                            <P>(a) The Surgeons General of the military departments are responsible for—</P>
                            <P>(1) Acceptance criteria;</P>
                            <P>(2) Technical requirements; and</P>
                            <P>(3) Inspection procedures needed to assure wholesomeness of foods.</P>
                            <P>(b) The contracting office may designate any Federal activity, capable of assuring wholesomeness and quality in food, to perform quality assurance for subsistence contract items. The designation may—</P>
                            <P>(1) Include medical service personnel of the military departments; and</P>
                            <P>(2) Be on a reimbursable basis.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>246.408-71</SECTNO>
                            <SUBJECT>Aircraft.</SUBJECT>
                            <P>(a) The Federal Aviation Administration (FAA) has certain responsibilities and prerogatives in connection with some commercial aircraft and of aircraft equipment and accessories (Pub. L. 85-726 (72 Stat 776, 49 U.S.C. 1423)). This includes the issuance of various certificates applicable to design, manufacture, and airworthiness.</P>
                            <P>(b) FAA evaluations are not a substitute for normal DoD evaluations of the contractor's quality assurance measures. Actual records of FAA evaluations may be of use to the contract administration office (CAO) and should be used to their maximum advantage.</P>
                            <P>(c) The CAO shall ensure that the contractor possesses any required FAA certificates prior to acceptance.</P>
                            <CITA>[56 FR 36460, July 31, 1991, as amended at 71 FR 27647, May 12, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>246.470</SECTNO>
                            <SUBJECT>Government contract quality assurance actions.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>246.470-1</SECTNO>
                            <SUBJECT>Assessment of additional costs.</SUBJECT>
                            <P>
                                (a) Under the clause at FAR 52.246-2, Inspection of Supplies—Fixed-Price, after considering the factors in paragraph (c) of this subsection, the quality assurance representative (QAR) may believe that the assessment of additional costs is warranted. If so, the representative shall recommend that the contracting officer take the necessary action and provide a recommendation 
                                <PRTPAGE P="413"/>
                                as to the amount of additional costs. Costs are based on the applicable Federal agency, foreign military sale, or public rate in effect at the time of the delay, reinspection, or retest.
                            </P>
                            <P>(b) If the contracting officer agrees with the QAR, the contracting officer shall—</P>
                            <P>(1) Notify the contractor, in writing, of the determination to exercise the Government's right under the clause at FAR 52.246-2, Inspection of Supplies—Fixed-Price; and</P>
                            <P>(2) Demand payment of the costs in accordance with the collection procedures contained in FAR Subpart 32.6.</P>
                            <P>(c) In making a determination to assess additional costs, the contracting officer shall consider—</P>
                            <P>(1) The frequency of delays, reinspection, or retest under both current and prior contracts;</P>
                            <P>(2) The cause of such delay, reinspection, or retest; and</P>
                            <P>(3) The expense of recovering the additional costs.</P>
                            <CITA>[71 FR 27647, May 12, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>246.470-2</SECTNO>
                            <SUBJECT>Quality evaluation data.</SUBJECT>
                            <P>The contract administration office shall establish a system for the collection, evaluation, and use of the types of quality evaluation data specified in PGI 246.470-2.</P>
                            <CITA>[71 FR 27647, May 12, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>246.471</SECTNO>
                            <SUBJECT>Authorizing shipment of supplies.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">General.</E>
                                 (1) Ordinarily, a representative of the contract administration office signs or stamps the shipping papers that accompany Government source-inspected supplies to release them for shipment. This is done for both prime and subcontracts.
                            </P>
                            <P>(2) An alternative procedure (see paragraph (b) of this section) permits the contractor to assume the responsibility for releasing the supplies for shipment.</P>
                            <P>(3) The alternative procedure may include prime contractor release of supplies inspected at a subcontractor's facility.</P>
                            <P>(4) The use of the alternative procedure releases DoD manpower to perform technical functions by eliminating routine signing or stamping of the papers accompanying each shipment.</P>
                            <P>
                                (b) 
                                <E T="03">Alternative Procedures—Contract Release for Shipment.</E>
                            </P>
                            <P>(1) For foreign military sales contracts, do not use alternative procedures.(2) The contract administration office may authorize, in writing, the contractor to release supplies for shipment when—</P>
                            <P>(i) The stamping or signing of the shipping papers by a representative of the contract administration office interferes with the operation of the Government contract quality assurance program or takes too much of the Government representative's time;</P>
                            <P>(ii) There is sufficient continuity of production to permit the Government to establish a systematic and continuing evaluation of the contractor's control of quality; and</P>
                            <P>(iii) The contractor has a record of satisfactory quality, including that pertaining to preparation for shipment.</P>
                            <P>(3) The contract administration office shall withdraw, in writing, the authorization when there is an indication that the conditions in paragraph (b)(2) of this subsection no longer exist.</P>
                            <P>(4) When the alternative procedure is used, require the contractor to—</P>
                            <P>(i) Type or stamp, and sign, the following statement on the required copy or copies of the shipping paper(s), or on an attachment—</P>
                            <EXTRACT>
                                <P>The supplies in this shipment—</P>
                                <P>1. Have been subjected to and have passed all examinations and tests required by the contract;</P>
                                <P>2. Were shipped in accordance with authorized shipping instructions;</P>
                                <P>3. Conform to the quality, identity, and condition called for by the contract; and</P>
                                <P>4. Are of the quantity shown on this document.</P>
                                <P>This shipment was—</P>
                                <P>1. Released in accordance with section 246.471 of the Defense FAR Supplement; and</P>
                                <P>2. Authorized by (name and title of the authorized representative of the contract administration office) in a letter dated (date of authorizing letter). (Signature and title of contractor's designated official.)</P>
                            </EXTRACT>
                            <P>
                                (ii) Release and process, in accordance with established instructions, the DD Form 250, Material Inspection and 
                                <PRTPAGE P="414"/>
                                Receiving Report, or other authorized receiving report.
                            </P>
                            <CITA>[56 FR 36460, July 31, 1991, as amended at 83 FR 66064, Dec. 21, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>246.472</SECTNO>
                            <SUBJECT>Inspection stamping.</SUBJECT>
                            <P>(a) DoD quality inspection approval marking designs (stamps) may be used for both prime contracts and subcontracts. Follow the procedures at PGI 246.472(a) for use of DoD inspection stamps.</P>
                            <P>(b) Policies and procedures regarding the use of National Aeronautics and Space Administration (NASA) quality status stamps are contained in NASA publications. When requested by NASA centers, the DoD inspector shall use NASA quality status stamps in accordance with current NASA requirements.</P>
                            <CITA>[71 FR 27647, May 12, 2006]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 246.5—Acceptance</HD>
                        <SECTION>
                            <SECTNO>246.504</SECTNO>
                            <SUBJECT>Certificate of conformance.</SUBJECT>
                            <P>Before authorizing a certificate of conformance for aviation or ship critical safety items, obtain the concurrence of the head of the design control activity (see 209.270).</P>
                            <CITA>[73 FR 1828, Jan. 10, 2008]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 246.6—Material Inspection and Receiving Reports</HD>
                        <SECTION>
                            <SECTNO>246.601</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>
                                <E T="03">See</E>
                                 Appendix F, Material Inspection and Receiving Report, for procedures and instructions for the use, preparation, and distribution of—
                            </P>
                            <P>(1) The Material Inspection and Receiving Report (DD Form 250 series); and</P>
                            <P>(2) Supplier's commercial shipping/packing lists used to evidence Government contract quality assurance.</P>
                            <CITA>[71 FR 27647, May 12, 2006]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 246.7—Warranties</HD>
                        <SECTION>
                            <SECTNO>246.702</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>246.702-70</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this subpart—</P>
                            <P>
                                <E T="03">Acceptance</E>
                                 as used in this subpart and in the warranty clauses at FAR 52.246-17, Warranty of Supplies of a Noncomplex Nature; FAR 52.246-18, Warranty of Supplies of a Complex Nature; FAR 52.246-19, Warranty of Systems and Equipment Under Performance Specifications or Design Criteria; and FAR 52.246-20, Warranty of Services, includes the execution of an official document (e.g., DD Form 250, Material Inspection and Receiving Report) by an authorized representative of the Government.
                            </P>
                            <P>
                                <E T="03">Defect</E>
                                 means any condition or characteristic in any supply or service furnished by the contractor under the contract that is not in compliance with the requirements of the contract.
                            </P>
                            <P>
                                <E T="03">Enterprise</E>
                                 means the entity (
                                <E T="03">e.g.,</E>
                                 a manufacturer or vendor) responsible for granting the warranty and/or assigning unique item identifiers to serialized warranty items.
                            </P>
                            <P>
                                <E T="03">Enterprise identifier</E>
                                 means a code that is uniquely assigned to an enterprise by an issuing agency.
                            </P>
                            <P>
                                <E T="03">Issuing agency</E>
                                 means an organization responsible for assigning a globally unique identifier to an enterprise, as indicated in the Register of Issuing Agency Codes for International Standards Organization/International Electrotechnical Commission 15459, located at 
                                <E T="03">http://www.aimglobal.org/?Reg_Authority15459.</E>
                            </P>
                            <P>
                                <E T="03">Serialized item</E>
                                 means each item produced is assigned a serial number that is unique among all the collective tangible items produced by the enterprise, or each item of a particular part, lot, or batch number is assigned a unique serial number within that part, lot, or batch number assignment within the enterprise identifier. The enterprise is responsible for ensuring unique serialization within the enterprise identifier or within the part, lot, or batch numbers, and that serial numbers, once assigned, are never used again.
                            </P>
                            <P>
                                <E T="03">Unique item identifier</E>
                                 means a set of data elements marked on an item that is globally unique and unambiguous.
                            </P>
                            <P>
                                <E T="03">Warranty tracking</E>
                                 means the ability to trace a warranted item from delivery through completion of the effectivity of the warranty.
                            </P>
                            <CITA>[76 FR 33168, June 8, 2011, as amended at 81 FR 17043, Mar. 25, 2016. Redesignated at 86 FR 59871, Oct. 29, 2021]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="415"/>
                            <SECTNO>246.704</SECTNO>
                            <SUBJECT>Authority for use of warranties.</SUBJECT>
                            <P>(1) The chief of the contracting office must approve use of a warranty, except in acquisitions for—</P>
                            <P>
                                (i) Commercial products or commercial services (
                                <E T="03">see</E>
                                 FAR 46.709);
                            </P>
                            <P>
                                (ii) Technical data, unless the warranty provides for extended liability (
                                <E T="03">see</E>
                                 246.708);
                            </P>
                            <P>
                                (iii) Supplies and services in fixed-price type contracts containing quality assurance provisions that reference higher-level contract quality requirements (
                                <E T="03">see</E>
                                 246.202-4); or
                            </P>
                            <P>(iv) Supplies and services in construction contracts when using the warranties that are contained in Federal, military, or construction guide specifications.</P>
                            <P>(2) The chief of the contracting office shall approve the use of a warranty only when the benefits are expected to outweigh the cost.</P>
                            <CITA>[71 FR 27647, May 12, 2006, as amended at 88 FR 6588, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>246.705</SECTNO>
                            <SUBJECT>Limitations.</SUBJECT>
                            <P>(a) In addition to the exceptions provided in FAR 46.705(a), warranties in the clause at 252.246-7001, Warranty of Data, may be used in cost-reimbursement contracts.</P>
                            <CITA>[71 FR 27647, May 12, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>246.706</SECTNO>
                            <SUBJECT>Warranty terms and conditions.</SUBJECT>
                            <P>
                                (b)(5) 
                                <E T="03">Markings.</E>
                                 For other than commercial products, use MIL-STD-129, Marking for Shipments and Storage, and MIL-STD-130, Identification Marking of U.S. Military Property, when marking warranty items.
                            </P>
                            <CITA>[71 FR 27647, May 12, 2006, as amended at 88 FR 6588, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>246.708</SECTNO>
                            <SUBJECT>Warranties of data.</SUBJECT>
                            <P>Obtain warranties on technical data when practicable and cost effective. Consider the factors in FAR 46.703 in deciding whether to obtain warranties of technical data. Consider the following in deciding whether to use extended liability provisions—</P>
                            <P>(1) The likelihood that correction or replacement of the nonconforming data, or a price adjustment, will not give adequate protection to the Government; and</P>
                            <P>(2) The effectiveness of the additional remedy as a deterrent against furnishing nonconforming data.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>246.710</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>(1) Use a clause substantially the same as the basic or one of the alternates of the clause at 252.246-7001, Warranty of Data, in solicitations and contracts that include the clause at 252.227-7013, Rights in Technical Data and Computer Software, when there is a need for greater protection or period of liability than provided by the inspection and warranty clauses prescribed in FAR part 46.</P>
                            <P>(i) Use the basic clause in solicitations and contracts that are not firm-fixed price or fixed-price incentive.</P>
                            <P>(ii) Use alternate I in fixed-price-incentive solicitations and contracts.</P>
                            <P>(iii) Use alternate II in firm-fixed-price solicitations and contracts.</P>
                            <P>(2) Use the clause at 252.246-7002, Warranty of Construction (Germany), instead of the clause at FAR 52.246-21, Warranty of Construction, in solicitations and contracts for construction when a fixed-price contract will be awarded and contract performance will be in Germany.</P>
                            <P>(3) When the solicitation includes the clause at 252.211-7003, Item Unique Identification and Valuation, which is prescribed in 211.274-6(a), and it is anticipated that the resulting contract will include a warranty for serialized items—</P>
                            <P>(i) Use the provision at 252.246-7005, Notice of Warranty Tracking of Serialized Items, in the solicitation if the Government does not specify a warranty and offerors will be required to enter data with the offer;</P>
                            <P>(ii) Use the clause at 252.246-7006, Warranty Tracking of Serialized Items, in the solicitation and contract; and</P>
                            <P>
                                (iii) Include the following warranty attachments, available at 
                                <E T="03">https://www.pdrep.csd.disa.mil/pdrep_files/other/wsr.htm,</E>
                                 in the solicitation and contract and see 246.710-70:
                            </P>
                            <P>
                                (A) Warranty Tracking Information.
                                <PRTPAGE P="416"/>
                            </P>
                            <P>(B) Source of Repair Instructions.</P>
                            <CITA>[56 FR 36460, July 31, 1991, as amended at 62 FR 34128, June 24, 1997; 64 FR 51077, Sept. 21, 1999; 71 FR 27647, May 12, 2006; 76 FR 33168, June 8, 2011; 78 FR 76072, Dec. 16, 2013; 79 FR 17449, Mar. 28, 2014; 79 FR 18654, Apr. 3, 2014; 81 FR 17043, Mar. 25, 2016; 86 FR 59871, Oct. 29, 2021]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>246.710-70</SECTNO>
                            <SUBJECT>Warranty attachments.</SUBJECT>
                            <P>Follow the procedures at PGI 246.710-70 regarding warranty attachments.</P>
                            <CITA>[81 FR 17043, Mar. 25, 2016]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 246.8—Contractor Liability for Loss of or Damage to Property of the Government</HD>
                        <SOURCE>
                            <HD SOURCE="HED">Source:</HD>
                            <P>79 FR 26106, May 6, 2014, unless otherwise noted.</P>
                        </SOURCE>
                        <SECTION>
                            <SECTNO>246.870</SECTNO>
                            <SUBJECT>Contractor counterfeit electronic part detection and avoidance.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>246.870-0</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>This section—</P>
                            <P>(a) Partially implements section 818(c) and (e) of the National Defense Authorization Act for Fiscal Year 2012 (Pub. L. 112-81), as amended by section 817 of the National Defense Authorization Act for Fiscal Year 2015 (Pub. L. 113-291 and section 885 of the National Defense Authorization Act for Fiscal Year 2016 (Pub. L. 114-92); and</P>
                            <P>(b) Prescribes policy and procedures for preventing counterfeit electronic parts and suspect counterfeit electronic parts from entering the supply chain when procuring electronic parts or end items, components, parts, or assemblies that contain electronic parts.</P>
                            <CITA>[79 FR 26106, May 6, 2014. Redesignated and amended at 81 FR 50648, Aug. 2, 2016; 83 FR 19645, May 4, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>246.870-1</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <P>
                                <E T="03">Authorized supplier,</E>
                                 as used in this subpart, means a supplier, distributor, or an aftermarket manufacturer with a contractual arrangement with, or the express written authority of, the original manufacturer or current design activity to buy, stock, repackage, sell, or distribute the part.
                            </P>
                            <CITA>[81 FR 50648, Aug. 2, 2016]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>246.870-2</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Sources of electronic parts.</E>
                                 (1) Except as provided in paragraph (a)(2) of this section, the Government requires contractors and subcontractors at all tiers, to—
                            </P>
                            <P>(i) Obtain electronic parts that are in production by the original manufacturer or an authorized aftermarket manufacturer or currently available in stock from—</P>
                            <P>(A) The original manufacturers of the parts;</P>
                            <P>(B) Their authorized suppliers; or</P>
                            <P>(C) Suppliers that obtain such parts exclusively from the original manufacturers of the parts or their authorized suppliers; and</P>
                            <P>(ii) Obtain electronic parts that are not in production by the original manufacturer or an authorized aftermarket manufacturer, and that are not currently available in stock from a source listed in paragraph (a)(1)(i) of this section, from suppliers identified by the Contractor as contractor-approved suppliers, provided that—</P>
                            <P>
                                (A) For identifying and approving such contractor-approved suppliers, the contractor uses established counterfeit prevention industry standards and processes (including inspection, testing, and authentication), such as the DoD-adopted standards at 
                                <E T="03">https://assist.dla.mil;</E>
                            </P>
                            <P>(B) The contractor assumes responsibility for the authenticity of parts provided by such contractor-approved suppliers (see 231.205-71); and</P>
                            <P>(C) The selection of such contractor-approved suppliers is subject to review, audit, and approval by the Government, generally in conjunction with a contractor purchasing system review or other surveillance of purchasing practices by the contract administration office, or if the Government obtains credible evidence that a contractor-approved supplier has provided counterfeit parts. The contractor may proceed with the acquisition of electronic parts from a contractor-approved supplier unless otherwise notified by DoD.</P>
                            <P>
                                (2) The Government requires contractors and subcontractors to comply with the notification, inspection, testing, and authentication requirements of paragraph (b)(3)(ii) of the clause at 
                                <PRTPAGE P="417"/>
                                252.246-7008, Sources of Electronic Parts, if the contractor—
                            </P>
                            <P>(i) Obtains an electronic part from—</P>
                            <P>(A) A source other than any of the sources identified in paragraph (a)(1) of this section, due to nonavailability from such sources; or</P>
                            <P>(B) A subcontractor (other than the original manufacturer) that refuses to accept flowdown of this clause; or</P>
                            <P>(ii) Cannot confirm that an electronic part is new or not previously used and that it has not been comingled in supplier new production or stock with used, refurbished, reclaimed, or returned parts.</P>
                            <P>(3) Contractors and subcontractors are still required to comply with the requirements of paragraphs (a)(1) or (2) of this section, as applicable, if—</P>
                            <P>(i) Authorized to purchase electronic parts from the Federal Supply Schedule;</P>
                            <P>(ii) Purchasing electronic parts from suppliers accredited by the Defense Microelectronics Activity; or</P>
                            <P>(iii) Requisitioning electronic parts from Government inventory/stock under the authority of the clause at 252.251-7000, Ordering from Government Supply Sources.</P>
                            <P>(A) The cost of any required inspection, testing, and authentication of such parts may be charged as a direct cost.</P>
                            <P>(B) The Government is responsible for the authenticity of the requisitioned electronic parts. If any such part is subsequently found to be counterfeit or suspect counterfeit, the Government will—</P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) Promptly replace such part at no charge; and
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) Consider an adjustment in the contract schedule to the extent that replacement of the counterfeit or suspect counterfeit electronic parts caused a delay in performance.
                            </P>
                            <P>
                                (b) 
                                <E T="03">Contractor counterfeit electronic part detection and avoidance system.</E>
                                 (1) Contractors that are subject to the cost accounting standards and that supply electronic parts or products that include electronic parts, and their subcontractors that supply electronic parts or products that include electronic parts, are required to establish and maintain an acceptable counterfeit electronic part detection and avoidance system. Failure to do so may result in disapproval of the purchasing system by the contracting officer and/or withholding of payments (see 252.244-7001, Contractor Purchasing System Administration).
                            </P>
                            <P>
                                (2) 
                                <E T="03">System criteria.</E>
                                 A counterfeit electronic part detection and avoidance system shall include risk-based policies and procedures that address, at a minimum,the following areas (see the clause at 252.246-7007, Contractor Counterfeit Electronic Part Detection and Avoidance System):
                            </P>
                            <P>(i) The training of personnel.</P>
                            <P>(ii) The inspection and testing of electronic parts, including criteria for acceptance and rejection.</P>
                            <P>(iii) Processes to abolish counterfeit parts proliferation.</P>
                            <P>(iv) Processes for maintaining electronic part traceability.</P>
                            <P>(v) Use of suppliers in accordance with paragraph (a) of this section.</P>
                            <P>(vi) The reporting and quarantining of counterfeit electronic parts and suspect counterfeit electronic parts.</P>
                            <P>(vii) Methodologies to identify suspect counterfeit electronic parts and to rapidly determine if a suspect counterfeit electronic part is, in fact, counterfeit.</P>
                            <P>(viii) Design, operation, and maintenance of systems to detect and avoid counterfeit electronic parts and suspect counterfeit electronic parts.</P>
                            <P>(ix) Flow down of counterfeit detection and avoidance requirements.</P>
                            <P>(x) Process for keeping continually informed of current counterfeiting information and trends.</P>
                            <P>(xi) Process for screening the Government-Industry Data Exchange Program (GIDEP) reports and other credible sources of counterfeiting information.</P>
                            <P>(xii) Control of obsolete electronic parts.</P>
                            <CITA>[81 FR 50648, Aug. 2, 2016, as amended at 83 FR 19645, May 4, 2018; 87 FR 15818, Mar. 18, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>246.870-3</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>(a)(1) Except as provided in paragraph (a)(2) of this section, use the clause at 252.246-7007, Contractor Counterfeit Electronic Part Detection and Avoidance System, in solicitations and contracts when procuring—</P>
                            <P>
                                (i) Electronic parts;
                                <PRTPAGE P="418"/>
                            </P>
                            <P>(ii) End items, components, parts, or assemblies containing electronic parts; or</P>
                            <P>(iii) Services, if the contractor will supply electronic parts or components, parts, or assemblies containing electronic parts as part of the service.</P>
                            <P>(2) Do not use the clause in solicitations and contracts that are set aside for small business.</P>
                            <P>(b) Use the clause at 252.246-7008, Sources of Electronic Parts, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, when procuring—</P>
                            <P>(1) Electronic parts;</P>
                            <P>(2) End items, components, parts, or assemblies containing electronic parts; or</P>
                            <P>(3) Services, if the contractor will supply electronic parts or components, parts, or assemblies containing electronic parts as part of the service.</P>
                            <CITA>[79 FR 26106, May 6, 2014, as amended at 81 FR 50649, Aug. 2, 2016; 88 FR 6588, Jan. 31, 2023]</CITA>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 247</EAR>
                    <HD SOURCE="HED">PART 247—TRANSPORTATION</HD>
                    <CONTENTS>
                        <SECHD>Sec.</SECHD>
                        <SECTNO>247.001</SECTNO>
                        <SUBJECT>Definitions.</SUBJECT>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 247.1—General</HD>
                            <SECTNO>247.101</SECTNO>
                            <SUBJECT>Policies.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 247.2—Contracts for Transportation or for Transportation-Related Services</HD>
                            <SECTNO>247.200</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <SECTNO>247.206</SECTNO>
                            <SUBJECT>Preparation of solicitations and contracts.</SUBJECT>
                            <SECTNO>247.207</SECTNO>
                            <SUBJECT>Solicitation provisions, contract clauses, and special requirements.</SUBJECT>
                            <SECTNO>247.270</SECTNO>
                            <SUBJECT>Stevedoring contracts.</SUBJECT>
                            <SECTNO>247.270-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>247.270-2</SECTNO>
                            <SUBJECT>Technical provisions.</SUBJECT>
                            <SECTNO>247.270-3</SECTNO>
                            <SUBJECT>Evaluation of bids and proposals.</SUBJECT>
                            <SECTNO>247.270-4</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <SECTNO>247.271</SECTNO>
                            <SUBJECT>Contracts for the preparation of personal property for shipment or storage or for performance of intra-city or intra-area movement.</SUBJECT>
                            <SECTNO>247.271-1</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>247.271-2</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <SECTNO>247.271-3</SECTNO>
                            <SUBJECT>Solicitation provisions, schedule formats, and contract clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 247.3—Transportation in Supply Contracts</HD>
                            <SECTNO>247.301</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>247.301-70</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <SECTNO>247.301-71</SECTNO>
                            <SUBJECT>Evaluation factor or subfactor.</SUBJECT>
                            <SECTNO>247.305</SECTNO>
                            <SUBJECT>Solicitation provisions, contract clauses, and transportation factors.</SUBJECT>
                            <SECTNO>247.305-10</SECTNO>
                            <SUBJECT>Packing, marking, and consignment instructions.</SUBJECT>
                            <SECTNO>247.371</SECTNO>
                            <SUBJECT>DD Form 1384, Transportation Control and Movement Document.</SUBJECT>
                            <SECTNO>247.372</SECTNO>
                            <SUBJECT>DD Form 1653, Transportation Data for Solicitations.</SUBJECT>
                            <SECTNO>247.372</SECTNO>
                            <SUBJECT>DD Form 1654, Evaluation of Transportation Cost Factors.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 247.5—Ocean Transportation by U.S.-Flag Vessels</HD>
                            <SECTNO>247.570</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <SECTNO>247.571</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>247.572</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>247.573</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>247.574</SECTNO>
                            <SUBJECT>Solicitation provisions and contract clauses.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36466, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SECTION>
                        <SECTNO>247.001</SECTNO>
                        <SUBJECT>Definitions.</SUBJECT>
                        <P>For definitions of “Civil Reserve Air Fleet” and “Voluntary Intermodal Sealift Agreement,” see Joint Pub 1-02, DoD Dictionary of Military and Associated Terms. See additional information at PGI 247.001 for the Voluntary Intermodal Sealift Agreement program.</P>
                        <CITA>[75 FR 51417, &gt;Aug. 20, 2010]</CITA>
                    </SECTION>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 247.1—General</HD>
                        <SECTION>
                            <SECTNO>247.101</SECTNO>
                            <SUBJECT>Policies.</SUBJECT>
                            <P>
                                (h) 
                                <E T="03">Shipping documents covering f.o.b. origin shipments.</E>
                            </P>
                            <P>(i) Procedures for the contractor to obtain bills of lading are in the clause at 252.247-7028, Application for U.S. Government Shipping Documentation/Instructions.</P>
                            <P>(ii) The term “commercial bills of lading” includes the use of any commercial form or procedure.</P>
                            <CITA>[77 FR 39140, June 29, 2012]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <PRTPAGE P="419"/>
                        <HD SOURCE="HED">Subpart 247.2—Contracts for Transportation or for Transportation-Related Services</HD>
                        <SECTION>
                            <SECTNO>247.200</SECTNO>
                            <SUBJECT>Scope of subpart.</SUBJECT>
                            <P>This subpart does not apply to the operation of vessels owned by, or bareboat chartered by, the Government. See additional guidance at PGI 247.200 for procurement of transportation or related services.</P>
                            <CITA>[75 FR 51417, Aug. 20, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>247.206</SECTNO>
                            <SUBJECT>Preparation of solicitations and contracts.</SUBJECT>
                            <P>Consistent with FAR 15.304 and 215.304, consider using the following as evaluation factors or subfactors:</P>
                            <P>(1) Record of claims involving loss or damage; and</P>
                            <P>
                                (2) Commitment of transportation assets to readiness support (
                                <E T="03">e.g.,</E>
                                 Civil Reserve Air Fleet and Voluntary Intermodal Sealift Agreement).
                            </P>
                            <CITA>[75 FR 51417, Aug. 20, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>247.207</SECTNO>
                            <SUBJECT>Solicitation provisions, contract clauses, and special requirements.</SUBJECT>
                            <P>(1) Use the clause at 252.247-7003, Pass-Through of Motor Carrier Fuel Surcharge Adjustment to the Cost Bearer, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, that are for carriage in which a motor carrier, broker, or freight forwarder will provide or arrange truck transportation services that provide for a fuel-related adjustment.</P>
                            <P>(2) Use the clause at 252.247-7028, Application for U.S. Government Shipping Documentation/Instructions in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, when shipping under Bills of Lading and Domestic Route Order under FOB origin contracts, Export Traffic Release regardless of FOB terms, or foreign military sales shipments.</P>
                            <CITA>[77 FR 39140, June 29, 2012, as amended at 78 FR 37989, June 25, 2013; 88 FR 6588, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>247.270</SECTNO>
                            <SUBJECT>Stevedoring contracts.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>247.270-1</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>
                                <E T="03">Commodity rate</E>
                                 is—
                            </P>
                            <P>(1) The price quoted for handling a ton (weight or measurement) of a specified commodity; and</P>
                            <P>(2) Computed by dividing the hourly stevedoring gang cost by the estimated number of tons of the specified commodity that can be handled in 1 hour.</P>
                            <P>
                                <E T="03">Gang cost</E>
                                 is—
                            </P>
                            <P>(1) The total hourly wages paid to the workers in the gang, in accordance with the collective bargaining agreement between the maritime industry and the unions at a specific port; and</P>
                            <P>(2) Payments for workmen's compensation, social security taxes, unemployment insurance, taxes, liability and property damage insurance, general and administrative expenses, and profit.</P>
                            <P>
                                <E T="03">Stevedoring</E>
                                 is the—
                            </P>
                            <P>(1) Loading of cargo from an agreed point of rest on a pier or lighter and its storage aboard a vessel; or</P>
                            <P>(2) Breaking out and discharging of cargo from any space in the vessel to an agreed point of rest dockside or in a lighter.</P>
                            <CITA>[56 FR 36466, July 31, 1991, as amended at 65 FR 50144, Aug. 17, 2000. Redesignated at 75 FR 51417, Aug. 20, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>247.270-2</SECTNO>
                            <SUBJECT>Technical provisions.</SUBJECT>
                            <P>(a) Because conditions vary at different ports, and sometimes within the same port, it is not practical to develop standard technical provisions covering all phases of stevedoring operations.</P>
                            <P>(b) When including rail car, truck, or intermodal equipment loading and unloading, or other dock and terminal work under a stevedoring contract, include these requirements as separate items of work.</P>
                            <CITA>[65 FR 50144, Aug. 17, 2000. Redesignated at 75 FR 51417, Aug. 20, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>247.270-3</SECTNO>
                            <SUBJECT>Evaluation of bids and proposals.</SUBJECT>
                            <P>As a minimum, require that offers include—</P>
                            <P>
                                (a) Tonnage or commodity rates that apply to the bulk of the cargo worked under normal conditions;
                                <PRTPAGE P="420"/>
                            </P>
                            <P>(b) Labor-hour rates that apply to services not covered by commodity rates, or to work performed under hardship conditions; and</P>
                            <P>(c) Rates for equipment rental.</P>
                            <CITA>[65 FR 50144, Aug. 17, 2000. Redesignated at 75 FR 51417, Aug. 20, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>247.270-4</SECTNO>
                            <SUBJECT>Contract clauses.</SUBJECT>
                            <P>Use the following clauses in solicitations and contracts for stevedoring services as indicated:</P>
                            <P>(a) 252.247-7000, Hardship Conditions.</P>
                            <P>(b) 252.247-7002, Revision of Prices, when using negotiation.</P>
                            <P>(c) 252.247-7007, Liability and Insurance.</P>
                            <CITA>[84 FR 30953, June 28, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>247.271</SECTNO>
                            <SUBJECT>Contracts for the preparation of personal property for shipment or storage or for performance of intra-city or intra-area movement.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>247.271-1</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Annual contracts.</E>
                                 Normally—
                            </P>
                            <P>(1) Use requirements contracts to acquire services for the—</P>
                            <P>(i) Preparation of personal property for shipment or storage; and</P>
                            <P>(ii) Performance of intra-area movement.</P>
                            <P>(2) Award contracts on a calendar year basis.</P>
                            <P>(3) Provide for option years.</P>
                            <P>(4) Award contracts, or exercise option years, before November 1 of each year, if possible.</P>
                            <P>
                                (b) 
                                <E T="03">Areas of performance.</E>
                                 Define clearly in the solicitation each area of performance.
                            </P>
                            <P>(1) Establish one or more areas; however, hold the number to a minimum consistent with local conditions.</P>
                            <P>(2) Each schedule may provide for the same or different areas of performance. Determine the areas as follows—</P>
                            <P>(i) Use political boundaries, streets, or any other features as lines of demarcation. Consider such matters as—</P>
                            <P>(A) Total volume;</P>
                            <P>(B) Size of overall area; and</P>
                            <P>(C) The need to service isolated areas of high population density.</P>
                            <P>(ii) Specifically identify frequently used terminals, and consider them as being included in each area of performance described in the solicitation.</P>
                            <P>
                                (c) 
                                <E T="03">Maximum requirements-minimum capability.</E>
                                 The contracting officer must—
                            </P>
                            <P>(1) Establish realistic quantities on the Estimated Quantities Report in DoD 4500.9-R, Defense Transportation Regulation, Part IV;</P>
                            <P>(2) Ensure that the Government's minimum acceptable daily capability—</P>
                            <P>(i) Will at least equal the maximum authorized individual weight allowance as prescribed by the Joint Federal Travel Regulations; and</P>
                            <P>(ii) Will encourage maximum participation of small business concerns as offerors.</P>
                            <CITA>[56 FR 36466, July 31, 1991, as amended at 65 FR 50145, Aug. 17, 2000. Redesignated at 75 FR 51417, Aug. 20, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>247.271-2</SECTNO>
                            <SUBJECT>Procedures.</SUBJECT>
                            <P>Follow the procedures at PGI 247.271-2 for contracting for the preparation of personal property for shipment or storage.</P>
                            <CITA>[75 FR 51417, Aug. 20, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>247.271-3</SECTNO>
                            <SUBJECT>Solicitation provisions, schedule formats, and contract clauses.</SUBJECT>
                            <P>When acquiring services for the preparation of personal property for movement or storage, or for performance of intra-city or intra-area movement, use the following provisions, clauses, and schedules. Revise solicitation provisions and schedules, as appropriate, if using negotiation rather than sealed bidding. Overseas commands, except those in Alaska and Hawaii, may modify these clauses to conform to local practices, laws, and regulations.</P>
                            <P>(a) In solicitations and resulting contracts, the schedules provided by the installation personal property shipping office. Follow the procedures at PGI 247.271-3(c) for use of schedules.</P>
                            <P>(b) In addition to designating each ordering activity, as required by the clause at FAR 52.216-18, Ordering, identify by name or position title the individuals authorized to place orders for each activity. When provisions are made for placing oral orders in accordance with FAR 16.504(a)(4)(vii), document the oral orders in accordance with department or agency instructions.</P>
                            <P>
                                (c) The clause at 252.247-7014, Demurrage. See additional information at 
                                <PRTPAGE P="421"/>
                                PGI 247.271-3(c)(1) for demurrage and detention charges.
                            </P>
                            <P>(d) The clause at 252.247-7016, Contractor Liability for Loss and Damage.</P>
                            <P>(e) The clauses at FAR 52.247-8, Estimated Weight or Quantities Not Guaranteed, and FAR 52.247-13, Accessorial Services—Moving Contracts.</P>
                            <CITA>[56 FR 36466, July 31, 1991, as amended at 65 FR 50145, Aug. 17, 2000. Redesignated and amended at 75 FR 51417, Aug. 20, 2010; 78 FR 38235, June 26, 2013; 79 FR 22037, Apr. 21, 2014; 83 FR 30588, June 29, 2018; 83 FR 49179, Sept. 28, 2018; 84 FR 25195, May 31, 2019; 84 FR 30951, June 28, 2019]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 247.3—Transportation in Supply Contracts</HD>
                        <SECTION>
                            <SECTNO>247.301</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>
                                <E T="03">See</E>
                                 PGI 247.301 for transportation guidance relating to Government Purchase Card purchases.
                            </P>
                            <CITA>[75 FR 51417, Aug. 20, 2010, as amended at 81 FR 78012, Nov. 4, 2016]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>247.301-70</SECTNO>
                            <SUBJECT>Definition.</SUBJECT>
                            <P>“Integrated logistics managers” or “third-party logistics providers” means providers of multiple logistics services. Some examples of logistics services are the management of transportation, demand forecasting, information management, inventory maintenance, warehousing, and distribution.</P>
                            <CITA>[65 FR 50145, Aug. 17, 2000]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>247.301-71</SECTNO>
                            <SUBJECT>Evaluation factor or subfactor.</SUBJECT>
                            <P>For contracts that will include a significant requirement for transportation of items outside the contiguous United States, include an evaluation factor or subfactor that favors suppliers, third-party logistics providers, and integrated logistics managers that commit to using carriers that participate in one of the readiness programs (e.g., Civil Reserve Air Force Fleet and Voluntary Intermodal Sealift Agreement).</P>
                            <CITA>[65 FR 50145, Aug. 17, 2000, as amended at 81 FR 78012, Nov. 4, 2016]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>247.305</SECTNO>
                            <SUBJECT>Solicitation provisions, contract clauses, and transportation factors.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>247.305-10</SECTNO>
                            <SUBJECT>Packing, marking, and consignment instructions.</SUBJECT>
                            <P>Follow the procedures at PGI 247.305-10 for preparation of consignment instructions.</P>
                            <CITA>[75 FR 51417, Aug. 20, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>247.370</SECTNO>
                            <SUBJECT>DD Form 1384, Transportation Control and Movement Document.</SUBJECT>
                            <P>The transportation office of the shipping activity prepares the DD Form 1384 to accompany all shipments made through a military air or water port, in accordance with DoD 4500.9-R, Defense Transportation Regulation, Part II, Chapter 203. A link to this document is available in PGI 247.370.</P>
                            <CITA>[75 FR 51418, Aug. 20, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>247.371</SECTNO>
                            <SUBJECT>DD Form 1653, Transportation Data for Solicitations.</SUBJECT>
                            <P>The transportation specialist prepares the DD Form 1653 to accompany requirements for the acquisition of supplies. The completed form should contain recommendations for suitable f.o.b. terms and other suggested transportation provisions for inclusion in the solicitation.</P>
                            <CITA>[75 FR 51418, Aug. 20, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>247.372</SECTNO>
                            <SUBJECT>DD Form 1654, Evaluation of Transportation Cost Factors.</SUBJECT>
                            <P>Contracting personnel may use the DD Form 1654 to furnish information to the transportation office for development of cost factors for use by the contracting officer in the evaluation of f.o.b. origin offers.</P>
                            <CITA>[56 FR 36466, July 31, 1991. Redesignated at 75 FR 51418, Aug. 20, 2010]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 247.5—Ocean Transportation by U.S.-Flag Vessels</HD>
                        <SECTION>
                            <SECTNO>247.570</SECTNO>
                            <SUBJECT>Scope.</SUBJECT>
                            <P>This subpart—</P>
                            <P>(a) Implements—</P>
                            <P>
                                (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 
                                <PRTPAGE P="422"/>
                                for use by, or otherwise transported by DoD;
                            </P>
                            <P>(2) Section 1017 of the National Defense Authorization Act for Fiscal Year 2007 (Pub. L. 109-364) (10 U.S.C. 2631 note), which requires consideration, in solicitations requiring a covered vessel, of the extent to which offerors have had overhaul, repair, and maintenance work performed in shipyards located in the United States or Guam;</P>
                            <P>(3) Section 3504 of the National Defense Authorization Act for Fiscal Year 2009 (Pub. L. 110-417) (10 U.S.C. chapter 257 note), which addresses requirements that apply to riding gang members and DoD-exempted individuals (see 252.247-7027(c)) who perform work on U.S.-flag vessels under DoD contracts for transportation services documented under 46 U.S.C. chapter 121; and</P>
                            <P>(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.</P>
                            <P>(b) Does not specifically implement the Cargo Preference Act of 1954 (“the 1954 Act”), 46 U.S.C. chapter 553. The 1954 Act is applicable to DoD, but DFARS coverage is not required because compliance with the 1904 Act historically has resulted in DoD exceeding the 1954 Act's requirements; and</P>
                            <P>(c) Does not implement—</P>
                            <P>(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</P>
                            <P>(2) Waivers thereof pursuant to 46 U.S.C. 501.</P>
                            <CITA>[65 FR 50146, Aug. 17, 2000, as amended at 72 FR 49205, Aug. 28, 2007; 73 FR 70911, Nov. 24, 2008; 75 FR 65438, Oct. 25, 2010; 89 FR 78994, Sept. 26, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>247.571</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>As used in this subpart—</P>
                            <P>
                                <E T="03">Corrective and preventive maintenance or repair</E>
                                 means—
                            </P>
                            <P>(1) Maintenance or repair actions performed as a result of a failure in order to return or restore equipment to acceptable performance levels; and</P>
                            <P>(2) Scheduled maintenance or repair actions to prevent or discover functional failures.</P>
                            <P>
                                <E T="03">Covered vessel</E>
                                 means a vessel—
                            </P>
                            <P>(1) Owned, operated, or controlled by the offeror; and</P>
                            <P>(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.</P>
                            <P>
                                <E T="03">Foreign-flag vessel</E>
                                 means any vessel that is not a U.S.-flag vessel.
                            </P>
                            <P>
                                <E T="03">Ocean transportation</E>
                                 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).
                            </P>
                            <P>
                                <E T="03">Overhaul, repair, and maintenance work</E>
                                 means work requiring a shipyard period greater than or equal to 5 calendar days.
                            </P>
                            <P>
                                <E T="03">Reflagging or repair work</E>
                                 means work performed on a vessel—
                            </P>
                            <P>(1) To enable the vessel to meet applicable standards to become a vessel of the United States; or</P>
                            <P>(2) To convert the vessel to a more useful military configuration.</P>
                            <P>
                                <E T="03">Supplies</E>
                                 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.
                            </P>
                            <P>
                                <E T="03">U.S.-flag vessel</E>
                                 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.
                            </P>
                            <CITA>[89 FR 78994, Sept. 26, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>247.572</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>
                                (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—
                                <PRTPAGE P="423"/>
                            </P>
                            <P>(1) Is not available at a fair and reasonable rate for commercial vessels of the United States; or</P>
                            <P>(2) Is not otherwise available.</P>
                            <P>(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.</P>
                            <P>(c) In accordance with 10 U.S.C. 2631(c)—</P>
                            <P>(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:</P>
                            <P>(i) Reflagging or repair work, if the reflagging or repair work is performed—</P>
                            <P>(A) On a vessel for which the contractor submitted an offer in response to the solicitation for the contract; and</P>
                            <P>(B) Prior to acceptance of the vessel by the Government.</P>
                            <P>(ii) Corrective and preventive maintenance or repair work for the duration of the contract, to the greatest extent practicable.</P>
                            <P>(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.</P>
                            <P>(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.</P>
                            <P>(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.</P>
                            <CITA>[89 FR 78994, Sept. 26, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>247.573</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Delegated authority.</E>
                                 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—
                            </P>
                            <P>(1) The Commander, United States Transportation Command; and</P>
                            <P>(2) The Secretary of the Navy.</P>
                            <P>
                                (b) 
                                <E T="03">Procedures.</E>
                                 (1) Contracting officers shall follow the procedures at PGI 247.573(b)(1) when purchase of ocean transportation services is incidental to a contract for supplies, services, or construction.
                            </P>
                            <P>(2) Contracting officers shall follow the procedures at PGI 247.573(b)(2) when direct purchase of ocean transportation services is the principal purpose of the contract.</P>
                            <P>(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.</P>
                            <P>(4) Follow the procedures at PGI 247.573(b)(4) to accomplish security background checks pursuant to clause 252.247-7027, Riding Gang Member Requirements.</P>
                            <P>(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.</P>
                            <P>(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.</P>
                            <CITA>[79 FR 61583, Oct. 14, 2014, as amended at 89 FR 78995, Sept. 26, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>247.574</SECTNO>
                            <SUBJECT>Solicitation provisions and contract clauses.</SUBJECT>
                            <P>
                                (a) Use the basic or one of the alternates of the clause at 252.247-7023, 
                                <PRTPAGE P="424"/>
                                Transportation of Supplies by Sea, in  solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, except those for direct purchase of ocean transportation services.
                            </P>
                            <P>(1) Use the basic clause unless any of the supplies to be transported are commercial products and commercial services that are—</P>
                            <P>(i) Shipped in direct support of U.S. military contingency operations, exercises, or forces deployed in humanitarian or peacekeeping operations when the contract is not a construction contract; or</P>
                            <P>(ii) Commissary or exchange cargoes transported outside of the Defense Transportation System when the contract is not a construction contract.</P>
                            <P>(2) Use the alternate I clause if any of the supplies to be transported are commercial products and commercial services that are shipped in direct support of U.S. military contingency operations, exercises, or forces deployed in humanitarian or peacekeeping operations when the contract is not a construction contract.</P>
                            <P>(3) Use the alternate II clause if any of the supplies to be transported are commercial products and commercial services that are commissary or exchange cargoes transported outside of the Defense Transportation System (10 U.S.C. 2643), when the contract is not a construction contract.</P>
                            <P>(b) Use the clause at 252.247-7025, Reflagging or Repair Work, in all time charter solicitations and contracts, including time charter solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, that are for the use of a vessel for the transportation of supplies, unless a waiver has been granted in accordance with 247.572(c)(2).</P>
                            <P>(c) Use the 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, in solicitations, including solicitations using FAR part 12 procedures for the acquisition of commercial products and commercial services, that require a covered vessel for carriage of cargo for DoD.</P>
                            <P>(d) Use the clause at 252.247-7027, Riding Gang Member Requirements, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, that are for the charter of, or contract for carriage of cargo by, a U.S.-flag vessel documented 46 U.S.C. chapter 121.</P>
                            <CITA>[56 FR 36466, July 31, 1991. Redesignated and amended at 72 FR 49206, Aug. 28, 2007]</CITA>
                            <EDNOTE>
                                <HD SOURCE="HED">Editorial Note:</HD>
                                <P>
                                    For 
                                    <E T="04">Federal Register</E>
                                     citations affecting section 247.574, see the List of CFR Sections Affected, which appears in the Finding Aids section of the printed volume and at 
                                    <E T="03">www.govinfo.gov.</E>
                                </P>
                            </EDNOTE>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 249</EAR>
                    <HD SOURCE="HED">PART 249—TERMINATION OF CONTRACTS</HD>
                    <CONTENTS>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 249.1—General Principles</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>249.105</SECTNO>
                            <SUBJECT>Duties of termination contracting officer after issuance of notice of termination.</SUBJECT>
                            <SECTNO>249.105-1</SECTNO>
                            <SUBJECT>Termination status reports.</SUBJECT>
                            <SECTNO>249.105-2</SECTNO>
                            <SUBJECT>Release of excess funds.</SUBJECT>
                            <SECTNO>249.109</SECTNO>
                            <SUBJECT>Settlement agreements.</SUBJECT>
                            <SECTNO>249.109-7</SECTNO>
                            <SUBJECT>Settlement by determination.</SUBJECT>
                            <SECTNO>249.109-70</SECTNO>
                            <SUBJECT>Limitation on pricing of the terminated effort.</SUBJECT>
                            <SECTNO>249.110</SECTNO>
                            <SUBJECT>Settlement negotiation memorandum.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 249.5—Contract Termination Clauses</HD>
                            <SECTNO>249.501</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>249.501-70</SECTNO>
                            <SUBJECT>Special termination costs.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 249.70—Special Termination Requirements</HD>
                            <SECTNO>249.7000</SECTNO>
                            <SUBJECT>Terminated contracts with Canadian Commercial Corporation.</SUBJECT>
                            <SECTNO>249.7001</SECTNO>
                            <SUBJECT>Congressional notification on significant contract terminations.</SUBJECT>
                            <SECTNO>249.7002</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>249.7003</SECTNO>
                            <SUBJECT>Notification of anticipated contract terminations or reductions.</SUBJECT>
                            <SECTNO>249.7004</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36471, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SUBPART>
                        <PRTPAGE P="425"/>
                        <HD SOURCE="HED">Subpart 249.1—General Principles</HD>
                        <SECTION>
                            <SECTNO>249.105</SECTNO>
                            <SUBJECT>Duties of termination contracting officer after issuance of notice of termination.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>249.105-1</SECTNO>
                            <SUBJECT>Termination status reports.</SUBJECT>
                            <P>Follow the procedures at PGI 249.105-1 for reporting status of termination actions.</P>
                            <CITA>[71 FR 27645, May 12, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>249.105-2</SECTNO>
                            <SUBJECT>Release of excess funds.</SUBJECT>
                            <P>See PGI 249.105-2 for guidance on recommending the release of excess funds.</P>
                            <CITA>[71 FR 27645, May 12, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>249.109</SECTNO>
                            <SUBJECT>Settlement agreements.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>249.109-7</SECTNO>
                            <SUBJECT>Settlement by determination.</SUBJECT>
                            <P>Follow the procedures at PGI 249.109-7 for settlement of a convenience termination by determination.</P>
                            <CITA>[71 FR 27645, May 12, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>249.109-70</SECTNO>
                            <SUBJECT>Limitation on pricing of the terminated effort.</SUBJECT>
                            <P>When there is a termination for convenience (partial or whole) or a change that reduces scope, follow the procedures at PGI 249.109-70 for limitation on pricing of the terminated or reduced effort.</P>
                            <CITA>[84 FR 30953, June 28, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>249.110</SECTNO>
                            <SUBJECT>Settlement negotiation memorandum.</SUBJECT>
                            <P>Follow the procedures at PGI 249.110 for preparation of a settlement negotiation memorandum.</P>
                            <CITA>[71 FR 27645, May 12, 2006]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 249.5—Contract Termination Clauses</HD>
                        <SECTION>
                            <SECTNO>249.501</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>249.501-70</SECTNO>
                            <SUBJECT>Special termination costs.</SUBJECT>
                            <P>(a) The clause at 252.249-7000, Special Termination Costs, may be used in an incrementally funded contract when its use is approved by the agency head.</P>
                            <P>(b) The clause is authorized when—</P>
                            <P>(1) The contract term is 2 years or more;</P>
                            <P>(2) The contract is estimated to require—</P>
                            <P>(i) Total RDT&amp;E financing in excess of $25 million; or</P>
                            <P>(ii) Total production investment in excess of $100 million; and</P>
                            <P>(3) Adequate funds are available to cover the contingent reserve liability for special termination costs.</P>
                            <P>(c) The contractor and the contracting officer must agree upon an amount that represents their best estimate of the total special termination costs to which the contractor would be entitled in the event of termination of the contract. Insert this amount in paragraph (c) of the clause.</P>
                            <P>(d)(1) Consider substituting an alternate paragraph (c) for paragraph (c) of the basic clause when—</P>
                            <P>(i) The contract covers an unusually long performance period; or</P>
                            <P>(ii) The contractor's cost risk associated with contingent special termination costs is expected to fluctuate extensively over the period of the contract.</P>
                            <P>(2) The alternate paragraph (c) should provide for periodic negotiation and adjustment of the amount reserved for special termination costs. Occasions for periodic adjustment may include—</P>
                            <P>(i) The Government's incremental assignment of funds to the contract;</P>
                            <P>(ii) The time when certain performance milestones are accomplished by the contractor; or</P>
                            <P>(iii) Other specific time periods agreed upon by the contracting officer and the contractor.</P>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 249.70—Special Termination Requirements</HD>
                        <SECTION>
                            <SECTNO>249.7000</SECTNO>
                            <SUBJECT>Terminated contracts with Canadian Commercial Corporation.</SUBJECT>
                            <P>(a) Terminate contracts with the Canadian Commercial Corporation in accordance with—</P>
                            <P>
                                (1) The Letter of Agreement (LOA) between the Department of Defence Production (Canada) and the U.S. DoD, “Canadian Agreement” (for a copy of 
                                <PRTPAGE P="426"/>
                                the LOA or for questions on its currency, contact the Office of the Principal Director, Defense Pricing, Contracting, and Acquisition Policy (Contract Policy), at 
                                <E T="03">osd.pentagon.ousd-a-s.mbx.asda-dp-c-contractpolicy@mail.mil;</E>
                            </P>
                            <P>(2) Policies in the Canadian Agreement and part 249; and</P>
                            <P>
                                (3) The Canadian Supply Manual, Chapter 8, Annex 8.3, available at 
                                <E T="03">http://www.tpsgc-pwgsc.gc.ca/app-acq/ga-sm/index-eng.html,</E>
                                 “Termination for Convenience Process, Public Works and Government Services Canada.”
                            </P>
                            <P>(b) Contracting officers shall ensure that the Canadian Commercial Corporation submits termination settlement proposals in the format prescribed in FAR 49.602 and that they contain the amount of settlements with subcontractors. The termination contracting officer (TCO) shall prepare an appropriate settlement agreement. (See FAR 49.603.) The letter transmitting a settlement proposal must certify—</P>
                            <P>(1) That disposition of inventory has been completed; and</P>
                            <P>(2) That the Contract Claims Resolution Board of the Public Works and Government Services Canada has approved settlements with Canadian subcontractors when the Procedures Manual on Termination of Contracts requires such approval.</P>
                            <P>(c)(1) The Canadian Commercial Corporation will—</P>
                            <P>(i) Settle all Canadian subcontractor termination claims under the Canadian Agreement; and</P>
                            <P>(ii) Submit schedules listing serviceable and usable contractor inventory for screening to the TCO (see FAR 45.6).</P>
                            <P>(2) After screening, the TCO must provide guidance to the Canadian Commercial Corporation for disposition of the contractor inventory.</P>
                            <P>(3) Settlement of Canadian subcontractor claims are not subject to the approval and ratification of the TCO. However, when the proposed negotiated settlement exceeds the total contract price of the prime contract, the TCO shall obtain from the U.S. contracting officer prior to final settlement—</P>
                            <P>(i) Ratification of the proposed settlement; and</P>
                            <P>(ii) A contract modification increasing the contract price and obligating the additional funds.</P>
                            <P>(d) The Canadian Commercial Corporation should send all termination settlement proposals submitted by U.S. subcontractors and suppliers to the TCO of the cognizant contract administration office of the Defense Contract Management Agency for settlement. The TCO will inform the Canadian Commercial Corporation of the amount of the net settlement of U.S. subcontractors and suppliers so that this amount can be included in the Canadian Commercial Corporation termination proposal. The Canadian Commercial Corporation is responsible for execution of the settlement agreement with these subcontractors.</P>
                            <P>(e) The Canadian Commercial Corporation will continue administering contracts that the U.S. contracting officer terminates.</P>
                            <P>(f) The Canadian Commercial Corporation will settle all Canadian subcontracts in accordance with the policies, practices, and procedures of the Canadian Government.</P>
                            <P>(g) The U.S. agency administering the contract with the Canadian Commercial Corporation shall provide any services required by the Canadian Commercial Corporation, including disposal of inventory, for settlement of any subcontracts placed in the United States. Settlement of such U.S. subcontracts will be in accordance with this regulation.</P>
                            <CITA>[56 FR 36471, July 31, 1991, as amended at 65 FR 39706, June 27, 2000; 68 FR 7440, Feb. 14, 2003; 71 FR 27645, May 12, 2006; 72 FR 30278, May 31, 2007; 76 FR 3537, Jan. 20, 2011; 79 FR 56279, Sept. 19, 2014; 88 FR 73238, Oct. 25, 2023; 89 FR 60832, July 29, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>249.7001</SECTNO>
                            <SUBJECT>Congressional notification on significant contract terminations.</SUBJECT>
                            <P>
                                Congressional notification is required for any termination involving a reduction in employment of 100 or more contractor employees. Proposed terminations must be cleared through department/agency liaison offices before release of the termination notice, or any information on the proposed termination, to the contractor. Follow 
                                <PRTPAGE P="427"/>
                                the procedures at PGI 249.7001 for congressional notification and release of information.
                            </P>
                            <CITA>[71 FR 27645, May 12, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>249.7002</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>249.7003</SECTNO>
                            <SUBJECT>Notification of anticipated contract terminations or reductions.</SUBJECT>
                            <P>(a) Section 1372 of the National Defense Authorization Act for Fiscal Year 1994 (Pub. L. 103-160) and section 824 of the National Defense Authorization Act for Fiscal Year 1997 (Pub. L. 104-201) are intended to help establish benefit eligibility under the Workforce Innovation and Opportunity Act (29 U.S.C. Chapter 32) for employees of DoD contractors and subcontractors adversely affected by termination or substantial reductions in major defense programs.</P>
                            <P>(b) Departments and agencies are responsible for establishing procedures to—</P>
                            <P>(1) Identify which contracts (if any) under major defense programs will be terminated or substantially reduced as a result of the funding levels provided in an appropriations act; and</P>
                            <P>(2) Within 60 days of the enactment of such an act, provide notice of the anticipated termination of or substantial reduction in the funding of affected contracts—</P>
                            <P>(i) Directly to the Secretary of Labor; and</P>
                            <P>(ii) Through the contracting officer to each prime contractor.</P>
                            <P>(c) When subcontracts have been issued, the prime contractor is responsible for—</P>
                            <P>(1) Providing notice of the termination or substantial reduction in funding to all first-tier subcontractors with a subcontract valued equal to or greater than $700,000; and</P>
                            <P>(2) Requiring that each subcontractor—</P>
                            <P>(i) Provide such notice to each of its subcontractors for subcontracts valued greater than $150,000; and</P>
                            <P>(ii) Impose a similar notice and flowdown requirement in subcontracts valued greater than $150,000 at all tiers.</P>
                            <CITA>[61 FR 64637, Dec. 6, 1996; 61 FR 66077, Dec. 16, 1996; 62 FR 49304, Sept. 19, 1997; 85 FR 34535, June 5, 2020]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>249.7004</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at 252.249-7002, Notification of Anticipated Contract Termination or Reduction, in all contracts under a major defense program.</P>
                            <CITA>[85 FR 34536, June 5, 2020]</CITA>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 250</EAR>
                    <HD SOURCE="HED">PART 250—EXTRAORDINARY CONTRACTUAL ACTIONS AND THE SAFETY ACT</HD>
                    <CONTENTS>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 250.1—Extraordinary Contractual Actions</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>250.100</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <SECTNO>250.101</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                            <SECTNO>250.101-2</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>250.101-2-70</SECTNO>
                            <SUBJECT>Limitations on payment.</SUBJECT>
                            <SECTNO>250.101-3</SECTNO>
                            <SUBJECT>Records.</SUBJECT>
                            <SECTNO>250.102</SECTNO>
                            <SUBJECT>Delegation of and limitations on exercise of authority.</SUBJECT>
                            <SECTNO>250.102-1</SECTNO>
                            <SUBJECT>Delegation of authority.</SUBJECT>
                            <SECTNO>250.102-1-70</SECTNO>
                            <SUBJECT>Delegations.</SUBJECT>
                            <SECTNO>250.102-2</SECTNO>
                            <SUBJECT>Contract adjustment boards.</SUBJECT>
                            <SECTNO>250.103</SECTNO>
                            <SUBJECT>Contract adjustments.</SUBJECT>
                            <SECTNO>250.103-3</SECTNO>
                            <SUBJECT>Contract adjustment.</SUBJECT>
                            <SECTNO>250.103-5</SECTNO>
                            <SUBJECT>Processing cases.</SUBJECT>
                            <SECTNO>250.103-6</SECTNO>
                            <SUBJECT>Disposition.</SUBJECT>
                            <SECTNO>250.104</SECTNO>
                            <SUBJECT>Residual powers.</SUBJECT>
                            <SECTNO>250.104-3</SECTNO>
                            <SUBJECT>Special procedures for unusually hazardous or nuclear risks.</SUBJECT>
                            <SECTNO>250.104-3-70</SECTNO>
                            <SUBJECT>Indemnification under contracts involving both research and development and other work.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>73 FR 46815, Aug. 12, 2008, unless otherwise noted.</P>
                    </SOURCE>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 250.1—Extraordinary Contractual Actions</HD>
                        <SECTION>
                            <SECTNO>250.100</SECTNO>
                            <SUBJECT>Definitions.</SUBJECT>
                            <P>
                                <E T="03">Secretarial level,</E>
                                 as used in this subpart, means—
                            </P>
                            <P>(1) An official at or above the level of an Assistant Secretary (or Deputy) of Defense or of the Army, Navy, or Air Force; and</P>
                            <P>(2) A contract adjustment board established by the Secretary concerned.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>250.101</SECTNO>
                            <SUBJECT>General.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>250.101-2</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>250.101-2-70</SECTNO>
                            <SUBJECT>Limitations on payment.</SUBJECT>
                            <P>
                                See 10 U.S.C. 3862 for limitations on Congressionally directed payment of a 
                                <PRTPAGE P="428"/>
                                request for equitable adjustment to contract terms or a request for relief under Public Law 85-804.
                            </P>
                            <CITA>[73 FR 46815, Aug. 12, 2008, as amended at 87 FR 76996, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>250.101-3</SECTNO>
                            <SUBJECT>Records.</SUBJECT>
                            <P>Follow the procedures at PGI 250.101-3 for preparation of records.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>250.102</SECTNO>
                            <SUBJECT>Delegation of and limitations on exercise of authority.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>250.102-1</SECTNO>
                            <SUBJECT>Delegation of authority.</SUBJECT>
                            <P>(b) Authority under FAR 50.104 to approve actions obligating $75,000 or less may not be delegated below the level of the head of the contracting activity.</P>
                            <P>(d) In accordance with the acquisition authority of the Under Secretary of Defense (Acquisition and Sustainment (USD (A&amp;S)) under 10 U.S.C. 133(b), in addition to the Secretary of Defense and the Secretaries of the military departments, the USD (A&amp;S ) may exercise authority to indemnify against unusually hazardous or nuclear risks.</P>
                            <CITA>[73 FR 46815, Aug. 12, 2008, as amended at 75 FR 45074, Aug. 2, 2010; 80 FR 36905, June 26, 2015; 85 FR 61504, Sept. 29, 2020; 87 FR 76996, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>250.102-1-70</SECTNO>
                            <SUBJECT>Delegations.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">Military departments.</E>
                                 The Departments of the Army, Navy, and Air Force will specify delegations and levels of authority for actions under the Act and the Executive Order in departmental supplements or agency acquisition guidance.
                            </P>
                            <P>
                                (b) 
                                <E T="03">Defense agencies.</E>
                                 Subject to the restrictions on delegations of authority in 250.102-1(b) and FAR 50.102-1, the directors of the defense agencies may exercise and redelegate the authority contained in the Act and the Executive Order. The agency supplements or agency acquisition guidance shall specify the delegations and levels of authority.
                            </P>
                            <P>(1) Requests to obligate the Government in excess of $75,000 must be submitted to the USD(A&amp;S) for approval.</P>
                            <P>(2) Requests for indemnification against unusually hazardous or nuclear risks must be submitted to the USD(A&amp;S) for approval before using the indemnification clause at FAR 52.250-1, Indemnification Under Public Law 85-804.</P>
                            <P>
                                (c) 
                                <E T="03">Approvals.</E>
                                 The Secretary of the military department or the agency director must approve any delegations in writing.
                            </P>
                            <CITA>[73 FR 46815, Aug. 12, 2008, as amended at 75 FR 45074, Aug. 2, 2010; 80 FR 36905, June 26, 2015; 85 FR 61504, Sept. 29, 2020; 88 FR 73238, Oct. 25, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>250.102-2</SECTNO>
                            <SUBJECT>Contract adjustment boards.</SUBJECT>
                            <P>The Departments of the Army, Navy, and Air Force each have a contract adjustment board. The board consists of a Chair and not less than two nor more than six other members, one of whom may be designated the Vice-Chair. A majority constitutes a quorum for any purpose and the concurring vote of a majority of the total board membership constitutes an action of the board. Alternates may be appointed to act in the absence of any member.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>250.103</SECTNO>
                            <SUBJECT>Contract adjustments.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>250.103-3</SECTNO>
                            <SUBJECT>Contract adjustment.</SUBJECT>
                            <P>(a) Contractor requests should be filed with the procuring contracting officer (PCO). However, if filing with the PCO is impractical, requests may be filed with an authorized representative, an administrative contracting officer, or the Office of General Counsel of the applicable department or agency, for forwarding to the cognizant PCO.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>250.103-5</SECTNO>
                            <SUBJECT>Processing cases.</SUBJECT>
                            <P>(1) At the time the request is filed, the activity shall prepare the record described at PGI 250.101-3(1)(i) and forward it to the appropriate official within 30 days after the close of the month in which the record is prepared.</P>
                            <P>(2) The officer or official responsible for the case shall forward to the contract adjustment board, through departmental channels, the documentation described at PGI 250.103-5.</P>
                            <P>
                                (3) Contract adjustment boards will render decisions as expeditiously as practicable. The Chair shall sign a memorandum of decision disposing of the case. The decision shall be dated and shall contain the information required by FAR 50.103-6. The memorandum of decision shall not contain 
                                <PRTPAGE P="429"/>
                                any information classified “Confidential” or higher. The board's decision will be sent to the appropriate official for implementation.
                            </P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>250.103-6</SECTNO>
                            <SUBJECT>Disposition.</SUBJECT>
                            <P>For requests denied or approved below the Secretarial level, follow the disposition procedures at PGI 250.103-6.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>250.104</SECTNO>
                            <SUBJECT>Residual powers.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>250.104-3</SECTNO>
                            <SUBJECT>Special procedures for unusually hazardous or nuclear risks.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>250.104-3-70</SECTNO>
                            <SUBJECT>Indemnification under contracts involving both research and development and other work.</SUBJECT>
                            <P>When indemnification is to be provided on contracts requiring both research and development work and other work, the contracting officer shall insert an appropriate clause using the authority of both 10 U.S.C. 3861 and Public Law 85-804.</P>
                            <P>(a) The use of Public Law 85-804 is limited to work which cannot be indemnified under 10 U.S.C. 3861 and is subject to compliance with FAR 50.104.</P>
                            <P>(b) Indemnification under 10 U.S.C. 3861 is covered by 235.070.</P>
                            <CITA>[73 FR 46815, Aug. 12, 2008, as amended at 87 FR 76996, Dec. 16, 2022]</CITA>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 251</EAR>
                    <HD SOURCE="HED">PART 251—USE OF GOVERNMENT SOURCES BY CONTRACTORS</HD>
                    <CONTENTS>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 251.1—Contractor Use of Government Supply Sources</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>251.101</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <SECTNO>251.102</SECTNO>
                            <SUBJECT>Authorization to use Government supply sources.</SUBJECT>
                            <SECTNO>251.107</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 251.2—Contractor Use of Interagency Fleet Management System (IFMS)</HD>
                            <SECTNO>251.202</SECTNO>
                            <SUBJECT>Authorization.</SUBJECT>
                            <SECTNO>251.205</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36479, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 251.1—Contractor Use of Government Supply Sources</HD>
                        <SECTION>
                            <SECTNO>251.101</SECTNO>
                            <SUBJECT>Policy.</SUBJECT>
                            <P>(a)(1) Notwithstanding the restriction at FAR 51.101(a)(1), contracting officers may authorize contractors to use Defense Logistics Agency Energy as a source of fuel in performance of other than cost-reimbursement contracts, when the fuel is funded by the Defense Working Capital Fund. When providing this authorization to contractors, follow the procedures at PGI 251.101.</P>
                            <CITA>[85 FR 53684, Aug. 31, 2020]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>251.102</SECTNO>
                            <SUBJECT>Authorization to use Government supply sources.</SUBJECT>
                            <P>(e) When authorizing contractor use of Government supply sources, follow the procedures at PGI 251.102.</P>
                            <P>(3)(ii) The contracting officer may also authorize the contractor to use the DD Form 1155 when requisitioning from the Department of Veterans Affairs.</P>
                            <P>(f) The authorizing agency is also responsible for promptly considering requests of the DoD supply source for authority to refuse to honor requisitions from a contractor that is indebted to DoD and has failed to pay proper invoices in a timely manner.</P>
                            <CITA>[69 FR 67858, Nov. 22, 2004]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>251.107</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at 252.251-7000, Ordering From Government Supply Sources, in solicitations and contracts which include the clause at FAR 52.251-1, Government Supply Sources.</P>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 251.2—Contractor Use of Interagency Fleet Management System (IFMS)</HD>
                        <SECTION>
                            <SECTNO>251.202</SECTNO>
                            <SUBJECT>Authorization.</SUBJECT>
                            <P>(a)(2)(A) See FAR 28.307-2(c) for policy on contractor insurance.</P>
                            <P>(B) See FAR 28.308 for policy on self-insurance.</P>
                            <P>(C) See FAR 31.205-19 for allowability of insurance costs.</P>
                            <P>(5) Paragraph (d) of the clause at 252.251-7001 satisfies the requirement of FAR 51.202(a)(5) for a written statement.</P>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="430"/>
                            <SECTNO>251.205</SECTNO>
                            <SUBJECT>Contract clause.</SUBJECT>
                            <P>Use the clause at 252.251-7001, Use of Interagency Fleet Management System (IFMS)Vehicles and Related Services, in solicitations and contracts which include the clause at FAR 52.251-2, Interagency Fleet Management System (IFMS) Vehicles and Related Services.</P>
                        </SECTION>
                    </SUBPART>
                </PART>
            </SUBCHAP>
            <SUBCHAP TYPE="P">
                <PRTPAGE P="431"/>
                <HD SOURCE="HED">SUBCHAPTER H—CLAUSES AND FORMS</HD>
                <PART>
                    <EAR>Pt. 252</EAR>
                    <HD SOURCE="HED">PART 252—SOLICITATION PROVISIONS AND CONTRACT CLAUSES</HD>
                    <CONTENTS>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 252.1—Instructions for Using Provisions and Clauses</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>252.101</SECTNO>
                            <SUBJECT>Using part 252.</SUBJECT>
                            <SECTNO>252.103</SECTNO>
                            <SUBJECT>Identification of provisions and clauses.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 252.2—Text of provisions and clauses</HD>
                            <SECTNO>252.201-7000</SECTNO>
                            <SUBJECT>Contracting officer's representative.</SUBJECT>
                            <SECTNO>252.203-7000</SECTNO>
                            <SUBJECT>Requirements relating to compensation of former DoD officials.</SUBJECT>
                            <SECTNO>252.203-7001</SECTNO>
                            <SUBJECT>Prohibition on Persons Convicted of Fraud or Other Defense-Contract-Related Felonies.</SUBJECT>
                            <SECTNO>252.203-7002</SECTNO>
                            <SUBJECT>Requirement to inform employees of whistleblower rights.</SUBJECT>
                            <SECTNO>252.203-7003</SECTNO>
                            <SUBJECT>Agency Office of the Inspector General.</SUBJECT>
                            <SECTNO>252.203-7004</SECTNO>
                            <SUBJECT>Display of Hotline Posters.</SUBJECT>
                            <SECTNO>252.203-7005</SECTNO>
                            <SUBJECT>Representation Relating to Compensation of Former DoD Officials.</SUBJECT>
                            <SECTNO>252.204-7000</SECTNO>
                            <SUBJECT>Disclosure of information.</SUBJECT>
                            <SECTNO>252.204-7001</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.204-7002</SECTNO>
                            <SUBJECT>Payment for Contract Line or Subline Items Not Separately Priced.</SUBJECT>
                            <SECTNO>252.204-7003</SECTNO>
                            <SUBJECT>Control of government personnel work product.</SUBJECT>
                            <SECTNO>252.204-7005</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.204-7006</SECTNO>
                            <SUBJECT>Billing Instructions—Cost Vouchers.</SUBJECT>
                            <SECTNO>252.204-7007</SECTNO>
                            <SUBJECT>Alternate A, Annual Representations and Certifications.</SUBJECT>
                            <SECTNO>252.204-7008</SECTNO>
                            <SUBJECT>Compliance with safeguarding covered defense information controls.</SUBJECT>
                            <SECTNO>252.204-7009</SECTNO>
                            <SUBJECT>Limitations on the Use or Disclosure of Third-Party Contractor Reported Cyber Incident Information.</SUBJECT>
                            <SECTNO>252.204-7010</SECTNO>
                            <SUBJECT>Requirement for contractor to notify DoD if the contractor's activities are subject to reporting under the U.S.-International Atomic Energy Agency Additional Protocol.</SUBJECT>
                            <SECTNO>252.204-7011</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.204-7012</SECTNO>
                            <SUBJECT>Safeguarding Covered Defense Information and Cyber Incident Reporting.</SUBJECT>
                            <SECTNO>252.204-7013</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.204-7014</SECTNO>
                            <SUBJECT>Limitations on the Use or Disclosure of Information by Litigation Support Contractors.</SUBJECT>
                            <SECTNO>252.204-7015</SECTNO>
                            <SUBJECT>Notice of Authorized Disclosure of Information for Litigation Support.</SUBJECT>
                            <SECTNO>252.204-7016</SECTNO>
                            <SUBJECT>Covered Defense Telecommunications Equipment or Services—Representation.</SUBJECT>
                            <SECTNO>252.204-7017</SECTNO>
                            <SUBJECT>Prohibition on the Acquisition of Covered Defense Telecommunications Equipment or Services—Representation.</SUBJECT>
                            <SECTNO>252.204-7018</SECTNO>
                            <SUBJECT>Prohibition on the Acquisition of Covered Defense Telecommunications Equipment or Services.</SUBJECT>
                            <SECTNO>252.204-7019</SECTNO>
                            <SUBJECT>Notice of NIST SP 800-171 DoD Assessment Requirements.</SUBJECT>
                            <SECTNO>252.204-7020</SECTNO>
                            <SUBJECT>NIST SP 800-171 DoD Assessment Requirements.</SUBJECT>
                            <SECTNO>252.204-7021</SECTNO>
                            <SUBJECT>Contractor Compliance with the Cybersecurity Maturity Model Certification Level Requirement.</SUBJECT>
                            <SECTNO>252.204-7022</SECTNO>
                            <SUBJECT>Expediting Contract Closeout.</SUBJECT>
                            <SECTNO>252.204-7023</SECTNO>
                            <SUBJECT>Reporting Requirements for Contracted Services.</SUBJECT>
                            <SECTNO>252.204-7024</SECTNO>
                            <SUBJECT>Notice on the Use of the Supplier Performance Risk System.</SUBJECT>
                            <SECTNO>252.205-7000</SECTNO>
                            <SUBJECT>Provision of information to cooperative agreement holders.</SUBJECT>
                            <SECTNO>252.206-7000</SECTNO>
                            <SUBJECT>Domestic Source Restriction.</SUBJECT>
                            <SECTNO>252.208-7000</SECTNO>
                            <SUBJECT>Intent to furnish precious metals as Government-furnished material.</SUBJECT>
                            <SECTNO>252.209-7001</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.209-7002</SECTNO>
                            <SUBJECT>Disclosure of Ownership or Control by a Foreign Government.</SUBJECT>
                            <SECTNO>252.209-7003</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.209-7004</SECTNO>
                            <SUBJECT>Subcontracting with Firms that are Owned or Controlled by the Government of a Country that is a State Sponsor of Terrorism.</SUBJECT>
                            <SECTNO>252.209-7005</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.209-7006</SECTNO>
                            <SUBJECT>Limitations on Contractors Acting as Lead System Integrators.</SUBJECT>
                            <SECTNO>252.209-7007</SECTNO>
                            <SUBJECT>Prohibited Financial Interests for Lead System Integrators.</SUBJECT>
                            <SECTNO>252.209-7008</SECTNO>
                            <SUBJECT>Notice of Prohibition Relating to Organizational Conflict of Interest—Major Defense Acquisition Program.</SUBJECT>
                            <SECTNO>252.209-7009</SECTNO>
                            <SUBJECT>Organizational Conflict of Interest—Major Defense Acquisition Program.</SUBJECT>
                            <SECTNO>252.209-7010</SECTNO>
                            <SUBJECT>Critical safety items.</SUBJECT>
                            <SECTNO>252.209-7011</SECTNO>
                            <SUBJECT>Representation for Restriction on the Use of Certain Institutions of Higher Education.</SUBJECT>
                            <SECTNO>252.211-7000—252.211-7001</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.211-7002</SECTNO>
                            <SUBJECT>Availability for examination of specifications, standards, plans, drawings, data item descriptions, and other pertinent documents.</SUBJECT>
                            <SECTNO>252.211-7003</SECTNO>
                            <SUBJECT>Item Unique Identification and Valuation.</SUBJECT>
                            <SECTNO>252.211-7004—252.211-7007</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.211-7008</SECTNO>
                            <SUBJECT>Use of Government-assigned serial numbers.</SUBJECT>
                            <SECTNO>252.212-7000—252.212-7001</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.212-7002</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.213-7000</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.215-7000—252.215-7001</SECTNO>
                            <SUBJECT>
                                [Reserved]
                                <PRTPAGE P="432"/>
                            </SUBJECT>
                            <SECTNO>252.215-7002</SECTNO>
                            <SUBJECT>Cost estimating system requirements.</SUBJECT>
                            <SECTNO>252.215-7003</SECTNO>
                            <SUBJECT>Requirement for submission of data other than certified cost or pricing data—Canadian Commercial Corporation.</SUBJECT>
                            <SECTNO>252.215-7004</SECTNO>
                            <SUBJECT>Requirement for submission of data other than certified cost or pricing data—Modifications-Canadian Commercial Corporation.</SUBJECT>
                            <SECTNO>252.215-7005</SECTNO>
                            <SUBJECT> [Reserved]</SUBJECT>
                            <SECTNO>252.215-7006</SECTNO>
                            <SUBJECT>Use of Employees or Individual Subcontractors Who Are Members of the Selected Reserve.</SUBJECT>
                            <SECTNO>252.215-7007</SECTNO>
                            <SUBJECT>Notice of Intent to Resolicit.</SUBJECT>
                            <SECTNO>252.215-7008</SECTNO>
                            <SUBJECT>Only One Offer.</SUBJECT>
                            <SECTNO>252.215-7009</SECTNO>
                            <SUBJECT>Proposal Adequacy Checklist.</SUBJECT>
                            <SECTNO>252.215-7010</SECTNO>
                            <SUBJECT>Requirements for Certified Cost or Pricing Data and Data Other Than Certified Cost or Pricing Data.</SUBJECT>
                            <SECTNO>252.215-7011</SECTNO>
                            <SUBJECT>Requirements for Submission of Proposals to the Administrative Contracting Officer and Contract Auditor.</SUBJECT>
                            <SECTNO>252.215-7012</SECTNO>
                            <SUBJECT>Requirements for Submission of Proposals via Electronic Media.</SUBJECT>
                            <SECTNO>252.215-7013</SECTNO>
                            <SUBJECT>Supplies and Services Provided by Nontraditional Defense Contractors.</SUBJECT>
                            <SECTNO>252.215-7014</SECTNO>
                            <SUBJECT>Exception from Certified Cost or Pricing Data Requirements for Foreign Military Sales Indirect Offsets.</SUBJECT>
                            <SECTNO>252.215-7015</SECTNO>
                            <SUBJECT>Program Should-Cost Review.</SUBJECT>
                            <SECTNO>252.215-7016</SECTNO>
                            <SUBJECT>Notification to Offerors—Postaward Debriefings.</SUBJECT>
                            <SECTNO>252.216-7000</SECTNO>
                            <SUBJECT>Economic Price Adjustment—Basic Steel, Aluminum, Brass, Bronze, or Copper Mill Products.</SUBJECT>
                            <SECTNO>252.216-7001</SECTNO>
                            <SUBJECT>Economic Price Adjustment-Nonstandard Steel Items.</SUBJECT>
                            <SECTNO>252.216-7002</SECTNO>
                            <SUBJECT>Alternate A, Time-and-Materials/Labor-Hour Proposal Requirements—Other Than Commercial Acquisition with Adequate Price Competition.</SUBJECT>
                            <SECTNO>252.216-7003</SECTNO>
                            <SUBJECT>Economic price adjustment—wage rates or material prices controlled by a foreign government.</SUBJECT>
                            <SECTNO>252.216-7004</SECTNO>
                            <SUBJECT>Award Fee Reduction or Denial for Jeopardizing the Health or Safety of Government Personnel.</SUBJECT>
                            <SECTNO>252.216-7005—252.216-7006</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.216-7007</SECTNO>
                            <SUBJECT>Economic price adjustment—basic steel, aluminum, brass, bronze, or copper mill products-representation.</SUBJECT>
                            <SECTNO>252.216-7008</SECTNO>
                            <SUBJECT>Economic price adjustment—wage rates or material prices controlled by a foreign government—representation.</SUBJECT>
                            <SECTNO>252.216-7009</SECTNO>
                            <SUBJECT>Allowability of Legal Costs Incurred in Connection with a Whistleblower Proceeding.</SUBJECT>
                            <SECTNO>252.216-7010</SECTNO>
                            <SUBJECT>Postaward Debriefings for Task Orders and Delivery Orders.</SUBJECT>
                            <SECTNO>252.217-7000</SECTNO>
                            <SUBJECT>Exercise of option to fulfill foreign military sales commitments.</SUBJECT>
                            <SECTNO>252.217-7001</SECTNO>
                            <SUBJECT>Surge option.</SUBJECT>
                            <SECTNO>252.217-7002</SECTNO>
                            <SUBJECT>Offering property for exchange.</SUBJECT>
                            <SECTNO>252.217-7003</SECTNO>
                            <SUBJECT>Changes.</SUBJECT>
                            <SECTNO>252.217-7004</SECTNO>
                            <SUBJECT>Job orders and compensation.</SUBJECT>
                            <SECTNO>252.217-7005</SECTNO>
                            <SUBJECT>Inspection and manner of doing work.</SUBJECT>
                            <SECTNO>252.217-7006</SECTNO>
                            <SUBJECT>Title.</SUBJECT>
                            <SECTNO>252.217-7007</SECTNO>
                            <SUBJECT>Payments.</SUBJECT>
                            <SECTNO>252.217-7008</SECTNO>
                            <SUBJECT>Bonds.</SUBJECT>
                            <SECTNO>252.217-7009</SECTNO>
                            <SUBJECT>Default.</SUBJECT>
                            <SECTNO>252.217-7010</SECTNO>
                            <SUBJECT>Performance.</SUBJECT>
                            <SECTNO>252.217-7011</SECTNO>
                            <SUBJECT>Access to vessel.</SUBJECT>
                            <SECTNO>252.217-7012</SECTNO>
                            <SUBJECT>Liability and insurance.</SUBJECT>
                            <SECTNO>252.217-7013</SECTNO>
                            <SUBJECT>Guarantees.</SUBJECT>
                            <SECTNO>252.217-7014</SECTNO>
                            <SUBJECT>Discharge of liens.</SUBJECT>
                            <SECTNO>252.217-7015</SECTNO>
                            <SUBJECT>Safety and health.</SUBJECT>
                            <SECTNO>252.217-7016</SECTNO>
                            <SUBJECT>Plant protection.</SUBJECT>
                            <SECTNO>252.217-7017—252.217-7025</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.217-7026</SECTNO>
                            <SUBJECT>Identification of Sources of Supply.</SUBJECT>
                            <SECTNO>252.217-7027</SECTNO>
                            <SUBJECT>Contract Definitization.</SUBJECT>
                            <SECTNO>252.217-7028</SECTNO>
                            <SUBJECT>Over and above work.</SUBJECT>
                            <SECTNO>252.219-7000</SECTNO>
                            <SUBJECT>Advancing Small Business Growth.</SUBJECT>
                            <SECTNO>252.219-7001—252.219-7002</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.219-7003</SECTNO>
                            <SUBJECT>Small Business Subcontracting Plan (DoD Contracts).</SUBJECT>
                            <SECTNO>252.219-7004</SECTNO>
                            <SUBJECT>Small Business Subcontracting Plan (Test Program).</SUBJECT>
                            <SECTNO>252.219-7005—252.219-7008</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.219-7009</SECTNO>
                            <SUBJECT>Section 8(a) direct award.</SUBJECT>
                            <SECTNO>252.219-7010</SECTNO>
                            <SUBJECT>Notification of Competition Limited to Eligible 8(a) Participants—Partnership Agreement</SUBJECT>
                            <SECTNO>252.219-7011</SECTNO>
                            <SUBJECT>Notification to delay performance.</SUBJECT>
                            <SECTNO>252.219-7012</SECTNO>
                            <SUBJECT>Competition for Religious-Related Services.</SUBJECT>
                            <SECTNO>252.222-7000</SECTNO>
                            <SUBJECT>Restrictions on employment of personnel.</SUBJECT>
                            <SECTNO>252.222-7001</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.222-7002</SECTNO>
                            <SUBJECT>Compliance with local labor laws (overseas).</SUBJECT>
                            <SECTNO>252.222-7003</SECTNO>
                            <SUBJECT>Permit from Italian Inspectorate of Labor.</SUBJECT>
                            <SECTNO>252.222-7004</SECTNO>
                            <SUBJECT>Compliance with Spanish social security laws and regulations.</SUBJECT>
                            <SECTNO>252.222-7005</SECTNO>
                            <SUBJECT>Prohibition on use of nonimmigrant aliens—Guam.</SUBJECT>
                            <SECTNO>252.222-7006</SECTNO>
                            <SUBJECT>Restrictions on the Use of Mandatory Arbitration Agreements.</SUBJECT>
                            <SECTNO>252.223-7000</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.223-7001</SECTNO>
                            <SUBJECT>Hazard warning labels.</SUBJECT>
                            <SECTNO>252.223-7002</SECTNO>
                            <SUBJECT>Safety Precautions for Ammunition and Explosives.</SUBJECT>
                            <SECTNO>252.223-7003</SECTNO>
                            <SUBJECT>Change in place of performance—ammunition and explosives.</SUBJECT>
                            <SECTNO>252.223-7004-252.223-7005</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.223-7006</SECTNO>
                            <SUBJECT>Prohibition on storage, treatment, and disposal of toxic or hazardous materials.</SUBJECT>
                            <SECTNO>252.223-7007</SECTNO>
                            <SUBJECT>Safeguarding Sensitive Conventional Arms, Ammunition, and Explosives.</SUBJECT>
                            <SECTNO>252.223-7008</SECTNO>
                            <SUBJECT>Prohibition of Hexavalent Chromium.</SUBJECT>
                            <SECTNO>252.223-7009</SECTNO>
                            <SUBJECT>Prohibition of Procurement of Fluorinated Fire-Fighting Agent for Use on Military Installations.</SUBJECT>
                            <SECTNO>252.225-7000</SECTNO>
                            <SUBJECT>
                                Buy American—Balance of Payments Program Certificate.
                                <PRTPAGE P="433"/>
                            </SUBJECT>
                            <SECTNO>252.225-7001</SECTNO>
                            <SUBJECT>Buy American and Balance of Payments Program.</SUBJECT>
                            <SECTNO>252.225-7002</SECTNO>
                            <SUBJECT>Qualifying Country Sources as Subcontractors.</SUBJECT>
                            <SECTNO>252.225-7003</SECTNO>
                            <SUBJECT>Report of intended performance outside the United States and Canada—Submission with offer.</SUBJECT>
                            <SECTNO>252.225-7004</SECTNO>
                            <SUBJECT>Reporting of intended performance outside the United States and Canada—Submission after award.</SUBJECT>
                            <SECTNO>252.225-7005</SECTNO>
                            <SUBJECT>Identification of Expenditures in the United States.</SUBJECT>
                            <SECTNO>252.225-7006</SECTNO>
                            <SUBJECT>Acquisition of the American flag.</SUBJECT>
                            <SECTNO>252.225-7007</SECTNO>
                            <SUBJECT>Prohibition on Acquisition of Certain Items from Communist Chinese Military Companies.</SUBJECT>
                            <SECTNO>252.225-7008</SECTNO>
                            <SUBJECT>Restriction on Acquisition of Specialty Metals.</SUBJECT>
                            <SECTNO>252.225-7009</SECTNO>
                            <SUBJECT>Restriction on Acquisition of Certain Articles Containing Specialty Metals.</SUBJECT>
                            <SECTNO>252.225-7010</SECTNO>
                            <SUBJECT>Commercial Derivative Military Article—Specialty Metals Compliance Certificate.</SUBJECT>
                            <SECTNO>252.225-7011</SECTNO>
                            <SUBJECT>Restriction on acquisition of supercomputers.</SUBJECT>
                            <SECTNO>252.225-7012</SECTNO>
                            <SUBJECT>Preference for Certain Domestic Commodities.</SUBJECT>
                            <SECTNO>252.225-7013</SECTNO>
                            <SUBJECT>Duty-Free Entry.</SUBJECT>
                            <SECTNO>252.225-7014</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.225-7015</SECTNO>
                            <SUBJECT>Restriction on acquisition of hand or measuring tools.</SUBJECT>
                            <SECTNO>252.225-7016</SECTNO>
                            <SUBJECT>Restriction on Acquisition of Ball and Roller Bearings.</SUBJECT>
                            <SECTNO>252.225-7017</SECTNO>
                            <SUBJECT>Photovoltaic devices.</SUBJECT>
                            <SECTNO>252.225-7018</SECTNO>
                            <SUBJECT>Photovoltaic devices—certificate.</SUBJECT>
                            <SECTNO>252.225-7019</SECTNO>
                            <SUBJECT>Restriction on Acquisition of Anchor and Mooring Chain.</SUBJECT>
                            <SECTNO>252.225-7020</SECTNO>
                            <SUBJECT>Trade agreements certificate.</SUBJECT>
                            <SECTNO>252.225-7021</SECTNO>
                            <SUBJECT>Trade Agreements.</SUBJECT>
                            <SECTNO>252.225-7022</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.225-7023</SECTNO>
                            <SUBJECT>Preference for products or services from Afghanistan.</SUBJECT>
                            <SECTNO>252.225-7024</SECTNO>
                            <SUBJECT>Requirement for products or services from Afghanistan.</SUBJECT>
                            <SECTNO>252.225-7025</SECTNO>
                            <SUBJECT>Restriction on acquisition of forgings.</SUBJECT>
                            <SECTNO>252.225-7026</SECTNO>
                            <SUBJECT>Acquisition restricted to products or services from Afghanistan.</SUBJECT>
                            <SECTNO>252.225-7027</SECTNO>
                            <SUBJECT>Restriction on contingent fees for foreign military sales.</SUBJECT>
                            <SECTNO>252.225-7028</SECTNO>
                            <SUBJECT>Exclusionary policies and practices of foreign governments.</SUBJECT>
                            <SECTNO>252.225-7029</SECTNO>
                            <SUBJECT>Acquisition of uniform components for Afghan military or Afghan National Police.</SUBJECT>
                            <SECTNO>252.225-7030</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.225-7031</SECTNO>
                            <SUBJECT>Secondary Arab boycott of Israel.</SUBJECT>
                            <SECTNO>252.225-7032</SECTNO>
                            <SUBJECT>Waiver of United Kingdom levies—Evaluation of offers.</SUBJECT>
                            <SECTNO>252.225-7033</SECTNO>
                            <SUBJECT>Waiver of United Kingdom Levies.</SUBJECT>
                            <SECTNO>252.225-7034</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.225-7035</SECTNO>
                            <SUBJECT>Buy American—Free Trade Agreements—Balance of Payments Program Certificate.</SUBJECT>
                            <SECTNO>252.225-7036</SECTNO>
                            <SUBJECT>Buy American—Free Trade Agreements—Balance of Payments Program.</SUBJECT>
                            <SECTNO>252.225-7037—252.225-7038</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.225-7039</SECTNO>
                            <SUBJECT>Defense Contractors Performing Private Security Functions Outside the United States.</SUBJECT>
                            <SECTNO>252.225-7040</SECTNO>
                            <SUBJECT>Contractor Personnel Supporting U.S. Armed Forces Deployed Outside the United States.</SUBJECT>
                            <SECTNO>252.225-7041</SECTNO>
                            <SUBJECT>Correspondence in English.</SUBJECT>
                            <SECTNO>252.225-7042</SECTNO>
                            <SUBJECT>Authorization to perform.</SUBJECT>
                            <SECTNO>252.225-7043</SECTNO>
                            <SUBJECT>Antiterrorism/force protection policy for defense contractors outside the United States.</SUBJECT>
                            <SECTNO>252.225-7044</SECTNO>
                            <SUBJECT>Balance of Payments Program—Construction Material.</SUBJECT>
                            <SECTNO>252.225-7045</SECTNO>
                            <SUBJECT>Balance of Payments Program—Construction Material Under Trade Agreements.</SUBJECT>
                            <SECTNO>252.225-7046</SECTNO>
                            <SUBJECT>Exports by approved community members in response to the solicitation.</SUBJECT>
                            <SECTNO>252.225-7047</SECTNO>
                            <SUBJECT>Exports by approved community members in performance of the contract.</SUBJECT>
                            <SECTNO>252.225-7048</SECTNO>
                            <SUBJECT>Export-controlled items.</SUBJECT>
                            <SECTNO>252.225-7049</SECTNO>
                            <SUBJECT>Prohibition on Acquisition of Certain Foreign Commercial Satellite Services—Representations.</SUBJECT>
                            <SECTNO>252.225-7050</SECTNO>
                            <SUBJECT>Disclosure of Ownership or Control by the Government of a Country that is a State Sponsor of Terrorism.</SUBJECT>
                            <SECTNO>252.225-7051</SECTNO>
                            <SUBJECT>Prohibition on Acquisition of Certain Foreign Commercial Satellite Services.</SUBJECT>
                            <SECTNO>252.225-7052</SECTNO>
                            <SUBJECT>Restriction on the Acquisition of Certain Magnets, Tantalum, and Tungsten.</SUBJECT>
                            <SECTNO>252.225-7053</SECTNO>
                            <SUBJECT>Representation Regarding Prohibition on Use of Certain Energy Sourced from Inside the Russian Federation.</SUBJECT>
                            <SECTNO>252.225-7054</SECTNO>
                            <SUBJECT>Prohibition on Use of Certain Energy Sourced from Inside the Russian Federation.</SUBJECT>
                            <SECTNO>252.225-7055</SECTNO>
                            <SUBJECT>Representation Regarding Business Operations with the Maduro Regime.</SUBJECT>
                            <SECTNO>252.225-7056</SECTNO>
                            <SUBJECT>Prohibition Regarding Business Operations with the Maduro Regime.</SUBJECT>
                            <SECTNO>252.225-7057</SECTNO>
                            <SUBJECT>Preaward Disclosure of Employment of Individuals Who Work in the People's Republic of China.</SUBJECT>
                            <SECTNO>252.225-7058</SECTNO>
                            <SUBJECT>Postaward Disclosure of Employment of Individuals Who Work in the People's Republic of China.</SUBJECT>
                            <SECTNO>252.225-7059</SECTNO>
                            <SUBJECT>Prohibition on Certain Procurements from the Xinjiang Uyghur Autonomous Region-Representation.</SUBJECT>
                            <SECTNO>252.225-7060</SECTNO>
                            <SUBJECT>
                                Prohibition on Certain Procurements from the Xinjiang Uyghur Autonomous Region.
                                <PRTPAGE P="434"/>
                            </SUBJECT>
                            <SECTNO>252.225-7061</SECTNO>
                            <SUBJECT>Restriction on the Acquisition of Personal Protective Equipment and Certain Other Items from Non-Allied Foreign Nations.</SUBJECT>
                            <SECTNO>252.225-7062</SECTNO>
                            <SUBJECT>Restriction on Acquisition of Large Medium-Speed Diesel Engines.</SUBJECT>
                            <SECTNO>252.225-7063</SECTNO>
                            <SUBJECT>Restriction on Acquisition of Components of T-AO 205 and T-ARC Class Vessels.</SUBJECT>
                            <SECTNO>252.225-7064</SECTNO>
                            <SUBJECT>Restriction on Acquisition of Certain Satellite Components.</SUBJECT>
                            <SECTNO>252.225-7065</SECTNO>
                            <SUBJECT>Restriction on Acquisition of Fuel for Overseas Contingency Operations.</SUBJECT>
                            <SECTNO>252.226-7001</SECTNO>
                            <SUBJECT>Utilization of Indian Organizations, Indian-Owned Economic Enterprises, and Native Hawaiian Small Business Concerns.</SUBJECT>
                            <SECTNO>252.226-7002</SECTNO>
                            <SUBJECT>Representation for Demonstration Project for Contractors Employing Persons with Disabilities.</SUBJECT>
                            <SECTNO>252.226-7003</SECTNO>
                            <SUBJECT>Drug-Free Work Force.</SUBJECT>
                            <SECTNO>252.227-7000</SECTNO>
                            <SUBJECT>Non-estoppel.</SUBJECT>
                            <SECTNO>252.227-7001</SECTNO>
                            <SUBJECT>Release of past infringement.</SUBJECT>
                            <SECTNO>252.227-7002</SECTNO>
                            <SUBJECT>Readjustment of payments.</SUBJECT>
                            <SECTNO>252.227-7003</SECTNO>
                            <SUBJECT>Termination.</SUBJECT>
                            <SECTNO>252.227-7004</SECTNO>
                            <SUBJECT>License grant.</SUBJECT>
                            <SECTNO>252.227-7005</SECTNO>
                            <SUBJECT>License term.</SUBJECT>
                            <SECTNO>252.227-7006</SECTNO>
                            <SUBJECT>License grant—running royalty.</SUBJECT>
                            <SECTNO>252.227-7007</SECTNO>
                            <SUBJECT>License term—running royalty.</SUBJECT>
                            <SECTNO>252.227-7008</SECTNO>
                            <SUBJECT>Computation of royalties.</SUBJECT>
                            <SECTNO>252.227-7009</SECTNO>
                            <SUBJECT>Reporting and payment of royalties.</SUBJECT>
                            <SECTNO>252.227-7010</SECTNO>
                            <SUBJECT>License to other Government agencies.</SUBJECT>
                            <SECTNO>252.227-7011</SECTNO>
                            <SUBJECT>Assignments.</SUBJECT>
                            <SECTNO>252.227-7012</SECTNO>
                            <SUBJECT>Patent License and Release Contract.</SUBJECT>
                            <SECTNO>252.227-7013</SECTNO>
                            <SUBJECT>Rights in Technical Data—Other Than Commercial Products and Commercial Services.</SUBJECT>
                            <SECTNO>252.227-7014</SECTNO>
                            <SUBJECT>Rights in Other Than Commercial Computer Software and Other Than Commercial Computer Software Documentation.</SUBJECT>
                            <SECTNO>252.227-7015</SECTNO>
                            <SUBJECT> Technical Data—Commercial Products and Commercial Services.</SUBJECT>
                            <SECTNO>252.227-7016</SECTNO>
                            <SUBJECT>Rights in Bid or Proposal Information.</SUBJECT>
                            <SECTNO>252.227-7017</SECTNO>
                            <SUBJECT>Identification and Assertion of Use, Release, or Disclosure Restrictions.</SUBJECT>
                            <SECTNO>252.227-7018</SECTNO>
                            <SUBJECT>Rights in Other Than Commercial Technical Data and Computer Software—Small Business Innovation Research (SBIR) Program.</SUBJECT>
                            <SECTNO>252.227-7019</SECTNO>
                            <SUBJECT>Validation of Asserted Restrictions—Computer Software.</SUBJECT>
                            <SECTNO>252.227-7020</SECTNO>
                            <SUBJECT>Rights in special works.</SUBJECT>
                            <SECTNO>252.227-7021</SECTNO>
                            <SUBJECT>Rights in data—existing works.</SUBJECT>
                            <SECTNO>252.227-7022</SECTNO>
                            <SUBJECT>Government rights (unlimited).</SUBJECT>
                            <SECTNO>252.227-7023</SECTNO>
                            <SUBJECT>Drawings and other data to become property of Government.</SUBJECT>
                            <SECTNO>252.227-7024</SECTNO>
                            <SUBJECT>Notice and approval of restricted designs.</SUBJECT>
                            <SECTNO>252.227-7025</SECTNO>
                            <SUBJECT>Limitations on the use or disclosure of government-furnished information marked with restrictive legends.</SUBJECT>
                            <SECTNO>252.227-7026</SECTNO>
                            <SUBJECT>Deferred delivery of technical data or computer software.</SUBJECT>
                            <SECTNO>252.227-7027</SECTNO>
                            <SUBJECT>Deferred ordering of technical data or computer software.</SUBJECT>
                            <SECTNO>252.227-7028</SECTNO>
                            <SUBJECT>Technical data or computer software previously delivered to the government.</SUBJECT>
                            <SECTNO>252.227-7029</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.227-7030</SECTNO>
                            <SUBJECT>Technical data—withholding of payment.</SUBJECT>
                            <SECTNO>252.227-7031</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.227-7032</SECTNO>
                            <SUBJECT>Rights in technical data and computer software (foreign).</SUBJECT>
                            <SECTNO>252.227-7033</SECTNO>
                            <SUBJECT>Rights in shop drawings.</SUBJECT>
                            <SECTNO>252.227-7034—252.227-7036</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.227-7037</SECTNO>
                            <SUBJECT>Validation of Restrictive Markings on Technical Data.</SUBJECT>
                            <SECTNO>252.227-7038</SECTNO>
                            <SUBJECT>Patent Rights—Ownership by the Contractor (Large Business).</SUBJECT>
                            <SECTNO>252.227-7039</SECTNO>
                            <SUBJECT>Patents—reporting of subject inventions.</SUBJECT>
                            <SECTNO>252.228-7000</SECTNO>
                            <SUBJECT>Reimbursement for War-Hazard Losses.</SUBJECT>
                            <SECTNO>252.228-7001</SECTNO>
                            <SUBJECT>Ground and Flight Risk.</SUBJECT>
                            <SECTNO>252.228-7002</SECTNO>
                            <SUBJECT>Aircraft flight risk.</SUBJECT>
                            <SECTNO>252.228-7003</SECTNO>
                            <SUBJECT>Capture and Detention.</SUBJECT>
                            <SECTNO>252.228-7004</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.228-7005</SECTNO>
                            <SUBJECT>Mishap Reporting and Investigation Involving Aircraft, Missiles, and Space Launch Vehicles.</SUBJECT>
                            <SECTNO>252.228-7006</SECTNO>
                            <SUBJECT>Compliance with Spanish Laws and Insurance.</SUBJECT>
                            <SECTNO>252.228-7007</SECTNO>
                            <SUBJECT>Public Aircraft and State Aircraft Operations—Liability.</SUBJECT>
                            <SECTNO>252.229-7000</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.229-7001</SECTNO>
                            <SUBJECT>Tax relief.</SUBJECT>
                            <SECTNO>252.229-7002</SECTNO>
                            <SUBJECT>Customs exemptions (Germany).</SUBJECT>
                            <SECTNO>252.229-7003</SECTNO>
                            <SUBJECT>Tax exemptions (Italy).</SUBJECT>
                            <SECTNO>252.229-7004</SECTNO>
                            <SUBJECT>Status of contractors as a direct contractor (Spain).</SUBJECT>
                            <SECTNO>252.229-7005</SECTNO>
                            <SUBJECT>Tax exemptions (Spain).</SUBJECT>
                            <SECTNO>252.229-7006</SECTNO>
                            <SUBJECT>Value added tax exclusion (United Kingdom).</SUBJECT>
                            <SECTNO>252.229-7007</SECTNO>
                            <SUBJECT>Verification of United States receipt of goods.</SUBJECT>
                            <SECTNO>252.229-7008</SECTNO>
                            <SUBJECT>Relief from import duty (United Kingdom).</SUBJECT>
                            <SECTNO>252.229-7009</SECTNO>
                            <SUBJECT>Relief from customs duty and value added tax on fuel (passenger vehicles) (United Kingdom).</SUBJECT>
                            <SECTNO>252.229-7010</SECTNO>
                            <SUBJECT>Relief from customs duty on fuel (United Kingdom).</SUBJECT>
                            <SECTNO>252.229-7011</SECTNO>
                            <SUBJECT>Reporting of Foreign Taxes—U.S. Assistance Programs.</SUBJECT>
                            <SECTNO>252.229-7012</SECTNO>
                            <SUBJECT>Tax exemptions (Italy)—representation.</SUBJECT>
                            <SECTNO>252.229-7013</SECTNO>
                            <SUBJECT>Tax exemptions (Spain)—representation.</SUBJECT>
                            <SECTNO>252.229-7014</SECTNO>
                            <SUBJECT>Full Exemption from Two-Percent Excise Tax on Certain Foreign Procurements.</SUBJECT>
                            <SECTNO>252.231-7000</SECTNO>
                            <SUBJECT>Supplemental cost principles.</SUBJECT>
                            <SECTNO>252.232-7000</SECTNO>
                            <SUBJECT>Advance payment pool.</SUBJECT>
                            <SECTNO>252.232-7001</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.232-7002</SECTNO>
                            <SUBJECT>
                                Progress Payments for Foreign Military Sales Acquisitions. 
                                <PRTPAGE P="435"/>
                            </SUBJECT>
                            <SECTNO>252.232-7003</SECTNO>
                            <SUBJECT>Electronic submission of payment requests and receiving reports.</SUBJECT>
                            <SECTNO>252.232-7004</SECTNO>
                            <SUBJECT>DoD progress payment rates.</SUBJECT>
                            <SECTNO>252.232-7005</SECTNO>
                            <SUBJECT>Reimbursement of Subcontractor Advance Payments—DoD Mentor-Protégé Program.</SUBJECT>
                            <SECTNO>252.232-7006</SECTNO>
                            <SUBJECT>Wide Area WorkFlow payment instructions.</SUBJECT>
                            <SECTNO>252.232-7007</SECTNO>
                            <SUBJECT>Limitation of Government's obligation.</SUBJECT>
                            <SECTNO>252.232-7008</SECTNO>
                            <SUBJECT>Assignment of claims (overseas).</SUBJECT>
                            <SECTNO>252.232-7009</SECTNO>
                            <SUBJECT>Mandatory payment by Governmentwide commercial purchase card.</SUBJECT>
                            <SECTNO>252.232-7010</SECTNO>
                            <SUBJECT>Levies on contract payments.</SUBJECT>
                            <SECTNO>252.232-7011</SECTNO>
                            <SUBJECT>Payments in support of emergencies and contingency operations.</SUBJECT>
                            <SECTNO>252.232-7012</SECTNO>
                            <SUBJECT>Performance-Based Payments—Whole-Contract Basis.</SUBJECT>
                            <SECTNO>252.232-7013</SECTNO>
                            <SUBJECT>Performance-Based Payments—Deliverable-Item Basis.</SUBJECT>
                            <SECTNO>252.232-7014</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.232-7015</SECTNO>
                            <SUBJECT>Performance-Based Payments—Representation.</SUBJECT>
                            <SECTNO>252.232-7016</SECTNO>
                            <SUBJECT>Notice of Progress Payments or Performance-Based Payments.</SUBJECT>
                            <SECTNO>252.232-7017</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.232-7018</SECTNO>
                            <SUBJECT>Progress Payments—Multiple Lots.</SUBJECT>
                            <SECTNO>252.233-7000</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.233-7001</SECTNO>
                            <SUBJECT>Choice of law (overseas).</SUBJECT>
                            <SECTNO>252.234-7001</SECTNO>
                            <SUBJECT>Notice of Earned Value Management System.</SUBJECT>
                            <SECTNO>252.234-7002</SECTNO>
                            <SUBJECT>Earned Value Management System.</SUBJECT>
                            <SECTNO>252.234-7003</SECTNO>
                            <SUBJECT>Notice of Cost and Software Data Reporting System.</SUBJECT>
                            <SECTNO>252.234-7004</SECTNO>
                            <SUBJECT>Cost and Software Data Reporting System.</SUBJECT>
                            <SECTNO>252.235-7000</SECTNO>
                            <SUBJECT>Indemnification Under 10 U.S.C. 3861—Fixed Price.</SUBJECT>
                            <SECTNO>252.235-7001</SECTNO>
                            <SUBJECT>Indemnification Under 10 U.S.C. 3861—Cost Reimbursement.</SUBJECT>
                            <SECTNO>252.235-7002</SECTNO>
                            <SUBJECT>Animal Welfare.</SUBJECT>
                            <SECTNO>252.235-7003</SECTNO>
                            <SUBJECT>Frequency Authorization.</SUBJECT>
                            <SECTNO>252.235-7004</SECTNO>
                            <SUBJECT>Protection of Human Subjects.</SUBJECT>
                            <SECTNO>252.235-7005—252.235-7009</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.235-7010</SECTNO>
                            <SUBJECT>Acknowledgement of support and disclaimer.</SUBJECT>
                            <SECTNO>252.235-7011</SECTNO>
                            <SUBJECT>Final scientific or technical report.</SUBJECT>
                            <SECTNO>252.236-7000</SECTNO>
                            <SUBJECT>Modification proposals—price breakdown.</SUBJECT>
                            <SECTNO>252.236-7001</SECTNO>
                            <SUBJECT>Contract drawings and specifications.</SUBJECT>
                            <SECTNO>252.236-7002</SECTNO>
                            <SUBJECT>Obstruction of navigable waterways.</SUBJECT>
                            <SECTNO>252.236-7003</SECTNO>
                            <SUBJECT>Payment for mobilization and preparatory work.</SUBJECT>
                            <SECTNO>252.236-7004</SECTNO>
                            <SUBJECT>Payment for mobilization and demobilization.</SUBJECT>
                            <SECTNO>252.236-7005</SECTNO>
                            <SUBJECT>Airfield safety precautions.</SUBJECT>
                            <SECTNO>252.236-7006</SECTNO>
                            <SUBJECT>Cost limitation.</SUBJECT>
                            <SECTNO>252.236-7007</SECTNO>
                            <SUBJECT>Additive or deductive items.</SUBJECT>
                            <SECTNO>252.236-7008</SECTNO>
                            <SUBJECT>Contract prices—bidding schedules.</SUBJECT>
                            <SECTNO>252.236-7009</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.236-7010</SECTNO>
                            <SUBJECT>Overseas military construction—Preference for United States firms.</SUBJECT>
                            <SECTNO>252.236-7011</SECTNO>
                            <SUBJECT>Overseas architect-engineer services—Restriction to United States firms.</SUBJECT>
                            <SECTNO>252.236-7012</SECTNO>
                            <SUBJECT>Military construction on Kwajalein Atoll—evaluation preference.</SUBJECT>
                            <SECTNO>252.236-7013</SECTNO>
                            <SUBJECT>Requirement for Competition Opportunity for American Steel Producers, Fabricators, and Manufacturers.</SUBJECT>
                            <SECTNO>252.237-7000</SECTNO>
                            <SUBJECT>Notice of special standards of responsibility.</SUBJECT>
                            <SECTNO>252.237-7001</SECTNO>
                            <SUBJECT>Compliance with audit standards.</SUBJECT>
                            <SECTNO>252.237-7002</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.237-7003</SECTNO>
                            <SUBJECT>Requirements.</SUBJECT>
                            <SECTNO>252.237-7004</SECTNO>
                            <SUBJECT>Area of performance.</SUBJECT>
                            <SECTNO>252.237-7005</SECTNO>
                            <SUBJECT>Performance and delivery.</SUBJECT>
                            <SECTNO>252.237-7006</SECTNO>
                            <SUBJECT>Subcontracting.</SUBJECT>
                            <SECTNO>252.237-7007</SECTNO>
                            <SUBJECT>Termination for default.</SUBJECT>
                            <SECTNO>252.237-7008</SECTNO>
                            <SUBJECT>Group interment.</SUBJECT>
                            <SECTNO>252.237-7009</SECTNO>
                            <SUBJECT>Permits.</SUBJECT>
                            <SECTNO>252.237-7010</SECTNO>
                            <SUBJECT>Prohibition on Interrogation of Detainees by Contractor Personnel.</SUBJECT>
                            <SECTNO>252.237-7011</SECTNO>
                            <SUBJECT>Preparation history.</SUBJECT>
                            <SECTNO>252.237-7012</SECTNO>
                            <SUBJECT>Instruction to offerors (count-of-articles).</SUBJECT>
                            <SECTNO>252.237-7013</SECTNO>
                            <SUBJECT>Instruction to offerors (bulk weight).</SUBJECT>
                            <SECTNO>252.237-7014</SECTNO>
                            <SUBJECT>Loss or damage (count-of-articles).</SUBJECT>
                            <SECTNO>252.237-7015</SECTNO>
                            <SUBJECT>Loss or damage (weight of articles).</SUBJECT>
                            <SECTNO>252.237-7016</SECTNO>
                            <SUBJECT>Delivery tickets.</SUBJECT>
                            <SECTNO>252.237-7017</SECTNO>
                            <SUBJECT>Individual laundry.</SUBJECT>
                            <SECTNO>252.237-7018</SECTNO>
                            <SUBJECT>Special definitions of Government property.</SUBJECT>
                            <SECTNO>252.237-7019</SECTNO>
                            <SUBJECT>Training for contractor personnel interacting with detainees.</SUBJECT>
                            <SECTNO>252.237-7020—252.237-7021</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.237-7022</SECTNO>
                            <SUBJECT>Services at installations being closed.</SUBJECT>
                            <SECTNO>252.237-7023</SECTNO>
                            <SUBJECT>Continuation of essential contractor services.</SUBJECT>
                            <SECTNO>252.237-7024</SECTNO>
                            <SUBJECT>Notice of continuation of essential contractor services.</SUBJECT>
                            <SECTNO>252.237-7025</SECTNO>
                            <SUBJECT>Pre-award Transparency Requirements for Firms Offering to Support Department of Defense Audits—Representation and Disclosure.</SUBJECT>
                            <SECTNO>252.237-7026</SECTNO>
                            <SUBJECT>Post-award Transparency Requirements for Firms that Support Department of Defense Audits.</SUBJECT>
                            <SECTNO>252.237-7027</SECTNO>
                            <SUBJECT>Transfer and Adoption of Military Animals.</SUBJECT>
                            <SECTNO>252.239-7000</SECTNO>
                            <SUBJECT>Protection against compromising emanations.</SUBJECT>
                            <SECTNO>252.239-7001</SECTNO>
                            <SUBJECT>Information Assurance Contractor Training and Certification.</SUBJECT>
                            <SECTNO>252.239-7002</SECTNO>
                            <SUBJECT>Access.</SUBJECT>
                            <SECTNO>252.239-7003</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.239-7004</SECTNO>
                            <SUBJECT>Orders for facilities and services.</SUBJECT>
                            <SECTNO>252.239-7005</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.239-7006</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.239-7007</SECTNO>
                            <SUBJECT>
                                Cancellation or termination of orders.
                                <PRTPAGE P="436"/>
                            </SUBJECT>
                            <SECTNO>252.239-7008</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.239-7009</SECTNO>
                            <SUBJECT>Representation of use of cloud computing.</SUBJECT>
                            <SECTNO>252.239-7010</SECTNO>
                            <SUBJECT>Cloud Computing Services.</SUBJECT>
                            <SECTNO>252.239-7011</SECTNO>
                            <SUBJECT>Special construction and equipment charges.</SUBJECT>
                            <SECTNO>252.239-7012</SECTNO>
                            <SUBJECT>Title to telecommunication facilities and equipment.</SUBJECT>
                            <SECTNO>252.239-7013</SECTNO>
                            <SUBJECT>Term of agreement and continuation of services.</SUBJECT>
                            <SECTNO>252.239-7014</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.239-7015</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.239-7016</SECTNO>
                            <SUBJECT>Telecommunications security equipment, devices, techniques, and services.</SUBJECT>
                            <SECTNO>252.239-7017</SECTNO>
                            <SUBJECT>Notice of Supply Chain Risk.</SUBJECT>
                            <SECTNO>252.239-7018</SECTNO>
                            <SUBJECT>Supply Chain Risk.</SUBJECT>
                            <SECTNO>252.241-7000</SECTNO>
                            <SUBJECT>Superseding contract.</SUBJECT>
                            <SECTNO>252.241-7001</SECTNO>
                            <SUBJECT>Government access.</SUBJECT>
                            <SECTNO>252.242-7000—252.242-7002</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.242-7004</SECTNO>
                            <SUBJECT>Material management and accounting system.</SUBJECT>
                            <SECTNO>252.242-7005</SECTNO>
                            <SUBJECT>Contractor business systems.</SUBJECT>
                            <SECTNO>252.242-7006</SECTNO>
                            <SUBJECT>Accounting system administration.</SUBJECT>
                            <SECTNO>252.243-7000</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.243-7001</SECTNO>
                            <SUBJECT>Pricing of contract modifications.</SUBJECT>
                            <SECTNO>252.243-7002</SECTNO>
                            <SUBJECT>Requests for Equitable Adjustment.</SUBJECT>
                            <SECTNO>252.244-7000</SECTNO>
                            <SUBJECT>Subcontracts for Commercial Products or Commercial Services.</SUBJECT>
                            <SECTNO>252.244-7001</SECTNO>
                            <SUBJECT>Contractor purchasing system administration.</SUBJECT>
                            <SECTNO>252.245-7000</SECTNO>
                            <SUBJECT>Government-furnished mapping, charting, and geodesy property.</SUBJECT>
                            <SECTNO>252.245-7001</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.245-7002</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.245-7003</SECTNO>
                            <SUBJECT>Contractor Property Management System Administration.</SUBJECT>
                            <SECTNO>252.245-7004</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.245-7005</SECTNO>
                            <SUBJECT>Management and Reporting of Government Property.</SUBJECT>
                            <SECTNO>252.246-7000</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.246-7001</SECTNO>
                            <SUBJECT>Warranty of data.</SUBJECT>
                            <SECTNO>252.246-7002</SECTNO>
                            <SUBJECT>Warranty of construction (Germany).</SUBJECT>
                            <SECTNO>252.246-7003</SECTNO>
                            <SUBJECT>Notification of Potential Safety Issues.</SUBJECT>
                            <SECTNO>252.246-7004</SECTNO>
                            <SUBJECT>Safety of Facilities, Infrastructure, and Equipment for Military Operations.</SUBJECT>
                            <SECTNO>252.246-7005</SECTNO>
                            <SUBJECT>Notice of Warranty Tracking of Serialized Items.</SUBJECT>
                            <SECTNO>252.246-7006</SECTNO>
                            <SUBJECT>Warranty Tracking of Serialized Items.</SUBJECT>
                            <SECTNO>252.246-7007</SECTNO>
                            <SUBJECT>Contractor Counterfeit Electronic Part Detection and Avoidance System.</SUBJECT>
                            <SECTNO>252.246-7008</SECTNO>
                            <SUBJECT>Sources of electronic parts.</SUBJECT>
                            <SECTNO>252.247-7000</SECTNO>
                            <SUBJECT>Hardship conditions.</SUBJECT>
                            <SECTNO>252.247-7001</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.247-7002</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.247-7003</SECTNO>
                            <SUBJECT>Pass-through of motor carrier fuel surcharge adjustment to the cost bearer.</SUBJECT>
                            <SECTNO>252.247-7004—252.247-7006</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.247-7007</SECTNO>
                            <SUBJECT>Liability and insurance.</SUBJECT>
                            <SECTNO>252.247-7008—252.247-7013</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.247-7014</SECTNO>
                            <SUBJECT>Demurrage.</SUBJECT>
                            <SECTNO>252.247-7015</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.247-7016</SECTNO>
                            <SUBJECT>Contractor liability for loss or damage.</SUBJECT>
                            <SECTNO>252.247-7017—252.247-7021</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.247-7022</SECTNO>
                            <SUBJECT>Representation of extent of transportation by sea.</SUBJECT>
                            <SECTNO>252.247-7023</SECTNO>
                            <SUBJECT>Transportation of Supplies by Sea.</SUBJECT>
                            <SECTNO>252.247-7024</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.247-7025</SECTNO>
                            <SUBJECT>Reflagging or Repair Work.</SUBJECT>
                            <SECTNO>252.247-7026</SECTNO>
                            <SUBJECT>Evaluation preference for use of domestic shipyards—applicable to acquisition of carriage by vessel for DoD cargo in the coastwise or noncontiguous trade.</SUBJECT>
                            <SECTNO>252.247-7027</SECTNO>
                            <SUBJECT>Riding Gang Member Requirements.</SUBJECT>
                            <SECTNO>252.247-7028</SECTNO>
                            <SUBJECT>Application for U.S. Government Shipping Documentation/Instructions.</SUBJECT>
                            <SECTNO>252.249-7000</SECTNO>
                            <SUBJECT>Special termination costs.</SUBJECT>
                            <SECTNO>252.249-7001</SECTNO>
                            <SUBJECT>[Reserved]</SUBJECT>
                            <SECTNO>252.249-7002</SECTNO>
                            <SUBJECT>Notification of Anticipated Contract Termination or Reduction.</SUBJECT>
                            <SECTNO>252.251-7000</SECTNO>
                            <SUBJECT>Ordering from Government supply sources.</SUBJECT>
                            <SECTNO>252.251-7001</SECTNO>
                            <SUBJECT>Use of Interagency Fleet Management System (IFMS) vehicles and related services.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36479, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 252.1—Instructions for Using Provisions and Clauses</HD>
                        <SECTION>
                            <SECTNO>252.101</SECTNO>
                            <SUBJECT>Using part 252.</SUBJECT>
                            <P>
                                (b) 
                                <E T="03">Numbering.</E>
                                 (2) 
                                <E T="03">Provisions or clauses that supplement the FAR.</E>
                            </P>
                            <P>(ii)(B) DFARS provisions or clauses use a four digit sequential number in the 7000 series, e.g., -7000, -7001, -7002. Department or agency supplemental provisions or clauses use four digit sequential numbers in the 9000 series.</P>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.103</SECTNO>
                            <SUBJECT>Identification of provisions and clauses.</SUBJECT>
                            <P>For guidance on numbering department or agency provisions and clauses, see PGI 252.103.</P>
                            <CITA>[80 FR 36718, June 26, 2015. Redesignated at 86 FR 59871, Oct. 29, 2021]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <PRTPAGE P="437"/>
                        <HD SOURCE="HED">Subpart 252.2—Text of Provisions and Clauses</HD>
                        <SECTION>
                            <SECTNO>252.201-7000</SECTNO>
                            <SUBJECT>Contracting officer's representative.</SUBJECT>
                            <P>As prescribed in 201.602-70, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Contracting Officer's Representative (DEC 1991)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition. Contracting officer's representative</E>
                                     means an individual designated in accordance with subsection 201.602-2 of the Defense Federal Acquisition Regulation Supplement and authorized in writing by the contracting officer to perform specific technical or administrative functions.
                                </P>
                                <P>(b) If the Contracting Officer designates a contracting officer's representative (COR), the Contractor will receive a copy of the written designation. It will specify the extent of the COR's authority to act on behalf of the contracting officer. The COR is not authorized to make any commitments or changes that will affect price, quality, quantity, delivery, or any other term or condition of the contract.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 57 FR 42633, Sept. 15, 1992]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.203-7000</SECTNO>
                            <SUBJECT>Requirements Relating to Compensation of Former DoD Officials.</SUBJECT>
                            <P>As prescribed in 203.171-4(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Requirements Relating to Compensation of Former DoD Officials (SEP 2011)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition. Covered DoD official,</E>
                                     as used in this clause, means an individual that—
                                </P>
                                <P>(1) Leaves or left DoD service on or after January 28, 2008; and</P>
                                <P>(2)(i) Participated personally and substantially in an acquisition as defined in 41 U.S.C. 131 with a value in excess of $10 million, and serves or served—</P>
                                <P>(A) In an Executive Schedule position under subchapter II of chapter 53 of Title 5, United States Code;</P>
                                <P>(B) In a position in the Senior Executive Service under subchapter VIII of chapter 53 of Title 5, United States Code; or</P>
                                <P>(C) In a general or flag officer position compensated at a rate of pay for grade O-7 or above under section 201 of Title 37, United States Code; or</P>
                                <P>(ii) Serves or served in DoD in one of the following positions: Program manager, deputy program manager, procuring contracting officer, administrative contracting officer, source selection authority, member of the source selection evaluation board, or chief of a financial or technical evaluation team for a contract in an amount in excess of $10 million.</P>
                                <P>(b) The Contractor shall not knowingly provide compensation to a covered DoD official within 2 years after the official leaves DoD service, without first determining that the official has sought and received, or has not received after 30 days of seeking, a written opinion from the appropriate DoD ethics counselor regarding the applicability of post-employment restrictions to the activities that the official is expected to undertake on behalf of the Contractor.</P>
                                <P>(c) Failure by the Contractor to comply with paragraph (b) of this clause may subject the Contractor to rescission of this contract, suspension, or debarment in accordance with 41 U.S.C. 2105(c).</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[74 FR 2409, Jan. 15, 2009, as amended at 76 FR 58137, Sept. 20, 2011; 78 FR 37990, June 25, 2013]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.203-7001</SECTNO>
                            <SUBJECT>Prohibition on Persons Convicted of Fraud or Other Defense-Contract-Related Felonies.</SUBJECT>
                            <P>As prescribed in 203.570-3, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Prohibition on Persons Convicted of Fraud or Other Defense-Contract-Related Felonies (JAN 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    (1) 
                                    <E T="03">Arising out of a contract with the DoD</E>
                                     means any act in connection with—
                                </P>
                                <P>(i) Attempting to obtain;</P>
                                <P>(ii) Obtaining; or</P>
                                <P>(iii) Performing a contract or first-tier subcontract of any agency, department, or component of the Department of Defense (DoD).</P>
                                <P>
                                    (2) 
                                    <E T="03">Conviction of fraud or any other felony</E>
                                     means any conviction for fraud or a felony in violation of state or Federal criminal statutes, whether entered on a verdict or plea, including a plea of 
                                    <E T="03">nolo contendere,</E>
                                     for which sentence has been imposed.
                                </P>
                                <P>
                                    (3) 
                                    <E T="03">Date of conviction</E>
                                     means the date judgment was entered against the individual.
                                </P>
                                <P>(b) Any individual who is convicted after September 29, 1988, of fraud or any other felony arising out of a contract with the DoD is prohibited from serving—</P>
                                <P>(1) In a management or supervisory capacity on this contract;</P>
                                <P>(2) On the board of directors of the Contractor;</P>
                                <P>
                                    (3) As a consultant, agent, or representative for the Contractor; or
                                    <PRTPAGE P="438"/>
                                </P>
                                <P>(4) In any other capacity with the authority to influence, advise, or control the decisions of the Contractor with regard to this contract.</P>
                                <P>(c) Unless waived, the prohibition in paragraph (b) of this clause applies for not less than 5 years from the date of conviction.</P>
                                <P>(d) 10 U.S.C. 4656 provides that the Contractor shall be subject to a criminal penalty of not more than $500,000 if convicted of knowingly—</P>
                                <P>(1) Employing a person under a prohibition specified in paragraph (b) of this clause; or</P>
                                <P>(2) Allowing such a person to serve on the board of directors of the contractor or first-tier subcontractor.</P>
                                <P>(e) In addition to the criminal penalties contained in 10 U.S.C. 4656, the Government may consider other available remedies, such as—</P>
                                <P>(1) Suspension or debarment;</P>
                                <P>(2) Cancellation of the contract at no cost to the Government; or</P>
                                <P>(3) Termination of the contract for default.</P>
                                <P>(f) The Contractor may submit written requests for waiver of the prohibition in paragraph (b) of this clause to the Contracting Officer. Requests shall clearly identify—</P>
                                <P>(1) The person involved;</P>
                                <P>(2) The nature of the conviction and resultant sentence or punishment imposed;</P>
                                <P>(3) The reasons for the requested waiver; and</P>
                                <P>(4) An explanation of why a waiver is in the interest of national security.</P>
                                <P>
                                    (g) 
                                    <E T="03">Subcontracts.</E>
                                     The Contractor agrees to include the substance of this clause, appropriately modified to reflect the identity and relationship of the parties, in all first-tier subcontracts exceeding the simplified acquisition threshold in part 2 of the Federal Acquisition Regulation, except those for commercial products, commercial services, or commercial components.
                                </P>
                                <P>
                                    (h) Pursuant to 10 U.S.C. 4656(c), defense contractors and subcontractors may obtain information as to whether a particular person has been convicted of fraud or any other felony arising out of a contract with the DoD by contacting The Office of Justice Programs, The Denial of Federal Benefits Office, U.S. Department of Justice, telephone (301) 937-1542; 
                                    <E T="03">www.ojp.usdoj.gov/BJA/grant/DPFC.html.</E>
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 58 FR 28471, May 13, 1993; 59 FR 27675, May 27, 1994; 60 FR 61600, Nov. 30, 1995; 62 FR 34128, June 24, 1997; 64 FR 14398, Mar. 25, 1999; 69 FR 74990, Dec. 15, 2004; 73 FR 76972, Dec. 18, 2008; 87 FR 76996, Dec. 16, 2022; 88 FR 6588, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.203-7002</SECTNO>
                            <SUBJECT>Requirement to Inform Employees of Whistleblower Rights.</SUBJECT>
                            <P>As prescribed in 203.970, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Requirement To Inform Employees of Whistleblower Rights (DEC 2022)</HD>
                                <P>(a) The Contractor shall inform its employees in writing, in the predominant native language of the workforce, of contractor employee whistleblower rights and protections under 10 U.S.C. 4701, as described in subpart 203.9 of the Defense Federal Acquisition Regulation Supplement.</P>
                                <P>(b) The Contractor shall include the substance of this clause, including this paragraph (b), in all subcontracts.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[74 FR 2411, Jan. 15, 2009, as amended at 78 FR 59854, Sept. 30, 2013; 87 FR 76996, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.203-7003</SECTNO>
                            <SUBJECT>Agency Office of the Inspector General.</SUBJECT>
                            <P>As prescribed in 203.1004(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Agency Office of the Inspector General (AUG 2019)</HD>
                                <P>The agency office of the Inspector General referenced in paragraphs (c) and (d) of FAR clause 52.203-13, Contractor Code of Business Ethics and Conduct, is the DoD Office of Inspector General at the following address:</P>
                                <FP SOURCE="FP-1">Department of Defense Office of Inspector General, Administrative Investigations, Contractor Disclosure Program, 4800 Mark Center Drive, Suite 14L25, Alexandria, VA 22350-1500.</FP>
                                <FP SOURCE="FP-1">
                                    Toll Free Telephone: 866-429-8011. Website: 
                                    <E T="03">https://www.dodig.mil/Programs/Contractor-Disclosure-Program/.</E>
                                </FP>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[77 FR 76937, Dec. 31, 2012, as amended at 84 FR 39203, Aug. 9, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.203-7004</SECTNO>
                            <SUBJECT>Display of Hotline Posters.</SUBJECT>
                            <P>As prescribed in 203.1004(b)(2)(ii), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Display of Hotline Posters (JAN 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Display of hotline poster(s).</E>
                                     (1)(i) The Contractor shall display prominently the DoD fraud, waste, and abuse hotline poster prepared by the DoD Office of the Inspector 
                                    <PRTPAGE P="439"/>
                                    General, in effect at time of contract award, in common work areas within business segments performing work under Department of Defense (DoD) contracts.
                                </P>
                                <P>(ii) For contracts performed outside the United States, when security concerns can be appropriately demonstrated, the contracting officer may provide the contractor the option to publicize the program to contractor personnel in a manner other than public display of the poster, such as private employee written instructions and briefings.</P>
                                <P>(2) If the contract is funded, in whole or in part, by Department of Homeland Security (DHS) disaster relief funds and the work is to be performed in the United States, the DHS fraud hotline poster shall be displayed in addition to the DoD hotline poster. If a display of a DHS fraud hotline poster is required, the Contractor may obtain such poster from—</P>
                                <P>(i) DHS Office of Inspector General/MAIL STOP 0305, Attn: Office of Investigations—Hotline, 245 Murray Lane SW., Washington, DC 20528-0305; or</P>
                                <P>
                                    (ii) Via the Internet at 
                                    <E T="03">https://www.oig.dhs.gov/assets/Hotline/DHS_OIG_Hotline-optimized.jpg.</E>
                                </P>
                                <P>
                                    (c)(1) These DoD hotline poster may be obtained from: Defense Hotline, The Pentagon, Washington, DC 20301-1900, or is also available via the internet at 
                                    <E T="03">https://www.dodig.mil/Resources/Posters-and-Brochures/.</E>
                                </P>
                                <P>(2) If a significant portion of the employee workforce does not speak English, then the poster is to be displayed in the foreign languages that a significant portion of the employees speak. </P>
                                <P>(3) Additionally, if the Contractor maintains a company Web site as a method of providing information to employees, the Contractor shall display an electronic version of the required poster at the Web site.</P>
                                <P>
                                    (d) 
                                    <E T="03">Subcontracts.</E>
                                     The Contractor shall include the substance of this clause, including this paragraph (d), in all subcontracts that exceed the threshold specified in Defense Federal Acquisition Regulation Supplement 203.1004(b)(2)(ii) on the date of subcontract award, except when the subcontract is for the acquisition of a commercial product or commercial service.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[80 FR 5001, Jan. 29, 2015, as amended at 80 FR 36905, June 26, 2015; 81 FR 73006, Oct. 21, 2016; 84 FR 25187, May 31, 2019; 84 FR 39203, Aug. 9, 2019; 88 FR 6589, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.203-7005</SECTNO>
                            <SUBJECT>Representation Relating to Compensation of Former DoD Officials.</SUBJECT>
                            <P>As prescribed in 203.171-4(b), insert the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Representation Relating to Compensation of Former DOD Officials (Sep 2022)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition. Covered DoD official</E>
                                     is defined in the clause at 252.203-7000, Requirements Relating to Compensation of Former DoD Officials.
                                </P>
                                <P>(b) By submission of this offer, the Offeror represents, to the best of its knowledge and belief, that all covered DoD officials employed by or otherwise receiving compensation from the Offeror, and who are expected to undertake activities on behalf of the Offeror for any resulting contract, are presently in compliance with all applicable post-employment restrictions, including those contained in 18 U.S.C. 207, 41 U.S.C. 2101-2107, 5 CFR part 2641, section 1045 of the National Defense Authorization Act for Fiscal Year 2018 (Pub. L. 115-91), and Federal Acquisition Regulation 3.104-2.</P>
                            </EXTRACT>
                            <P>(End of provision)</P>
                            <CITA>[76 FR 71830, Nov. 18, 2011, as amended at 87 FR 59029, Sept. 29, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.204-7000</SECTNO>
                            <SUBJECT>Disclosure of information.</SUBJECT>
                            <P>As prescribed in 204.404-70(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Disclosure of Information (OCT 2016)</HD>
                                <P>(a) The Contractor shall not release to anyone outside the Contractor's organization any unclassified information, regardless of medium (e.g., film, tape, document), pertaining to any part of this contract or any program related to this contract, unless—</P>
                                <P>(1) The Contracting Officer has given prior written approval;</P>
                                <P>(2) The information is otherwise in the public domain before the date of release; or</P>
                                <P>(3) The information results from or arises during the performance of a project that involves no covered defense information (as defined in the clause at DFARS 252.204-7012, Safeguarding Covered Defense Information and Cyber Incident Reporting) and has been scoped and negotiated by the contracting activity with the contractor and research performer and determined in writing by the contracting officer to be fundamental research (which by definition cannot involve any covered defense information), in accordance with National Security Decision Directive 189, National Policy on the Transfer of Scientific, Technical and Engineering Information, in effect on the date of contract award and the Under Secretary of Defense (Acquisition, Technology, and Logistics) memoranda on Fundamental Research, dated May 24, 2010, and on Contracted Fundamental Research, dated June 26, 2008 (available at DFARS PGI 204.4).</P>
                                <P>
                                    (b) Requests for approval under paragraph (a)(1) shall identify the specific information 
                                    <PRTPAGE P="440"/>
                                    to be released, the medium to be used, and the purpose for the release. The Contractor shall submit its request to the Contracting Officer at least 10 business days before the proposed date for release.
                                </P>
                                <P>(c) The Contractor agrees to include a similar requirement, including this paragraph (c), in each subcontract under this contract. Subcontractors shall submit requests for authorization to release through the prime contractor to the Contracting Officer.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[78 FR 48333, Aug. 8, 2013, as amended at 81 FR 72999, Oct. 21, 2016]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.204-7001</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.204-7002</SECTNO>
                            <SUBJECT>Payment for Contract Line or Subline Items Not Separately Priced.</SUBJECT>
                            <P>As prescribed in 204.7109(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Payment for Contract Line or Subline Items Not Separately Priced (APR 2020)</HD>
                                <P>(a) If the schedule in this contract contains any contract line or subline items identified as not separately priced (NSP), it means that the unit price for the NSP line or subline item is included in the unit price of another, related line or subline item.</P>
                                <P>(b) The Contractor shall not invoice the Government for an item that includes in its price an NSP item until—</P>
                                <P>(1) The Contractor has also delivered the NSP item included in the price of the item being invoiced; and</P>
                                <P>(2) The Government has accepted the NSP item.</P>
                                <P>(c) This clause does not apply to technical data.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[85 FR 19692, Apr. 8, 2020]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.204-7003</SECTNO>
                            <SUBJECT>Control of government personnel work product.</SUBJECT>
                            <P>As prescribed in 204.404-70(b), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Control of Government Personnel Work Product (APR 1992)</HD>
                                <P>The Contractor's procedures for protecting against unauthorized disclosure of information shall not require Department of Defense employees or members of the Armed Forces to relinquish control of their work products, whether classified or not, to the contractor.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[57 FR 14996, Apr. 23, 1992]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.204-7004</SECTNO>
                            <SUBJECT>Antiterrorism Awareness Training for Contractors.</SUBJECT>
                            <P>As prescribed in 204.7203, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Antiterrorism Awareness Training for Contractors (JAN 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Military installation</E>
                                     means a base, camp, post, station, yard, center, or other activity under the jurisdiction of the Secretary of a military department or, in the case of an activity in a foreign country, under the operational control of the Secretary of a military department or the Secretary of Defense (see 10 U.S.C. 2801(c)(4)).
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Training.</E>
                                     Contractor personnel who require routine physical access to a Federally-controlled facility or military installation shall complete Level I antiterrorism awareness training within 30 days of requiring access and annually thereafter. In accordance with Department of Defense Instruction O-2000.16 Volume 1, DoD Antiterrorism (AT) Program Implementation: DoD AT Standards, Level I antiterrorism awareness training shall be completed—
                                </P>
                                <P>(1) Through a DoD-sponsored and certified computer or web-based distance learning instruction for Level I antiterrorism awareness; or</P>
                                <P>(2) Under the instruction of a Level I antiterrorism awareness instructor.</P>
                                <P>
                                    (c) 
                                    <E T="03">Additional information.</E>
                                     Information and guidance pertaining to DoD antiterrorism awareness training is available at 
                                    <E T="03">https://jko.jten.mil/</E>
                                     or as otherwise identified in the performance work statement.
                                </P>
                                <P>
                                    (d) 
                                    <E T="03">Subcontracts.</E>
                                     The Contractor shall include the substance of this clause, including this paragraph (d), in subcontracts, including subcontracts for commercial products and commercial services, when subcontractor performance requires routine physical access to a Federally-controlled facility or military installation.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[84 FR 4364, Feb. 15, 2019, as amended at 88 FR 6589, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.204-7005</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.204-7006</SECTNO>
                            <SUBJECT>Billing Instructions—Cost Vouchers.</SUBJECT>
                            <P>As prescribed in 204.7109(b), use the following clause:</P>
                            <EXTRACT>
                                <PRTPAGE P="441"/>
                                <HD SOURCE="HD1">Billing Instructions—Cost Vouchers (MAY 2023)</HD>
                                <P>When submitting a request for payment using a cost voucher, the Contractor shall—</P>
                                <P>(a) Identify the contract line item(s) on the payment request that reasonably reflect contract work performance; and</P>
                                <P>(b) Separately identify a payment amount for each contract line item included in the payment request.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[70 FR 58983, Oct. 11, 2005, as amended at 85 FR 19692, Apr. 8, 2020; 88 FR 33833, May 25, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.204-7007</SECTNO>
                            <SUBJECT>Alternate A, Annual Representations and Certifications.</SUBJECT>
                            <P>As prescribed in 204.1202, use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Alternate A, Annual Representations and Certifications (OCT 2024)</HD>
                                <P>Substitute the following paragraphs (b), (d), and (e) for paragraphs (b) and (d) of the provision at FAR 52.204-8:</P>
                                <P>(b)(1) If the provision at FAR 52.204-7, System for Award Management, is included in this solicitation, paragraph (e) of this provision applies.</P>
                                <P>(2) If the provision at FAR 52.204-7, System for Award Management, is not included in this solicitation, and the Offeror has an active registration in the System for Award Management (SAM), the Offeror may choose to use paragraph (e) of this provision instead of completing the corresponding individual representations and certifications in the solicitation. The Offeror shall indicate which option applies by checking one of the following boxes:</P>
                                <P>____ (i) Paragraph (e) applies.</P>
                                <P>____ (ii) Paragraph (e) does not apply and the Offeror has completed the individual representations and certifications in the solicitation.</P>
                                <P>(d)(1) The following representations or certifications in the SAM database are applicable to this solicitation as indicated:</P>
                                <P>(i) 252.204-7016, Covered Defense Telecommunications Equipment or Services—Representation. Applies to all solicitations.</P>
                                <P>(ii) 252.216-7008, Economic Price Adjustment—Wage Rates or Material Prices Controlled by a Foreign Government. Applies to solicitations for fixed-price supply and service contracts when the contract is to be performed wholly or in part in a foreign country, and a foreign government controls wage rates or material prices and may during contract performance impose a mandatory change in wages or prices of materials.</P>
                                <P>(iii) 252.225-7042, Authorization to Perform. Applies to all solicitations when performance will be wholly or in part in a foreign country.</P>
                                <P>(iv) 252.225-7049, Prohibition on Acquisition of Certain Foreign Commercial Satellite Services—Representations. Applies to solicitations for the acquisition of commercial satellite services.</P>
                                <P>(v) 252.225-7050, Disclosure of Ownership or Control by the Government of a Country that is a State Sponsor of Terrorism. Applies to all solicitations expected to result in contracts of $150,000 or more.</P>
                                <P>(vi) 252.229-7012, Tax Exemptions (Italy)—Representation. Applies to solicitations when contract performance will be in Italy.</P>
                                <P>(vii) 252.229-7013, Tax Exemptions (Spain)—Representation. Applies to solicitations when contract performance will be in Spain.</P>
                                <P>
                                    (2) The following representations or certifications in SAM are applicable to this solicitation as indicated by the Contracting Officer: [
                                    <E T="03">Contracting Officer check as appropriate.</E>
                                    ]
                                </P>
                                <FP SOURCE="FP-2">____(i) 252.209-7002, Disclosure of Ownership or Control by a Foreign Government.</FP>
                                <FP SOURCE="FP-2">____(ii) 252.225-7000, Buy American—Balance of Payments Program Certificate.</FP>
                                <FP SOURCE="FP-2">____(iii) 252.225-7020, Trade Agreements Certificate.</FP>
                                <FP SOURCE="FP-2">____Use with Alternate I.</FP>
                                <FP SOURCE="FP-2">____(iv) 252.225-7031, Secondary Arab Boycott of Israel.</FP>
                                <FP SOURCE="FP-2">____(v) 252.225-7035, Buy American—Free Trade Agreements—Balance of Payments Program Certificate.</FP>
                                <FP SOURCE="FP-2">____Use with Alternate I.</FP>
                                <FP SOURCE="FP-2">____Use with Alternate II.</FP>
                                <FP SOURCE="FP-2">____Use with Alternate III.</FP>
                                <FP SOURCE="FP-2">____Use with Alternate IV.</FP>
                                <FP SOURCE="FP-2">____Use with Alternate V.</FP>
                                <FP SOURCE="FP-2">____ (vi) 252.226-7002, Representation for Demonstration Project for Contractors Employing Persons with Disabilities.</FP>
                                <FP SOURCE="FP-2">____ (vii) 252.232-7015, Performance-Based Payments—Representation.</FP>
                                <P>
                                    (e) The Offeror has completed the annual representations and certifications electronically via the SAM website at 
                                    <E T="03">https://www.sam.gov</E>
                                     After reviewing the SAM database information, the Offeror verifies by submission of the offer that the representations and certifications currently posted electronically that apply to this solicitation as indicated in FAR 52.204-8(c) and paragraph (d) of this provision have been entered or updated within the last 12 months, are current, accurate, complete, and applicable to this solicitation (including the business size standard applicable to the NAICS code referenced for this solicitation), as of the date of this offer, and are incorporated in this offer by reference (see FAR 4.1201); except for the changes identified below [
                                    <E T="03">
                                        Offeror to insert 
                                        <PRTPAGE P="442"/>
                                        changes, identifying change by provision number, title, date
                                    </E>
                                    ]. These amended representation(s) and/or certification(s) are also incorporated in this offer and are current, accurate, and complete as of the date of this offer.
                                </P>
                                <GPOTABLE COLS="4" OPTS="L2" CDEF="s50,r50,r50,r50">
                                    <BOXHD>
                                        <CHED H="1">FAR/DFARS provision No.</CHED>
                                        <CHED H="1">Title</CHED>
                                        <CHED H="1">Date</CHED>
                                        <CHED H="1">Change</CHED>
                                    </BOXHD>
                                    <ROW>
                                        <ENT I="22"> </ENT>
                                    </ROW>
                                </GPOTABLE>
                                <P>Any changes provided by the Offeror are applicable to this solicitation only, and do not result in an update to the representations and certifications located in the SAM database.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[76 FR 58141, Sept. 20, 2011]</CITA>
                            <EDNOTE>
                                <HD SOURCE="HED">Editorial Note:</HD>
                                <P>
                                    For 
                                    <E T="04">Federal Register</E>
                                     citations affecting section 252.204-7007, see the List of CFR Sections Affected, which appears in the Finding Aids section of the printed volume and at 
                                    <E T="03">www.govinfo.gov.</E>
                                </P>
                            </EDNOTE>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.204-7008</SECTNO>
                            <SUBJECT>Compliance with safeguarding covered defense information controls.</SUBJECT>
                            <P>As prescribed in 204.7304(a), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Compliance With Safeguarding Covered Defense Information Controls (OCT 2016)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this provision—
                                </P>
                                <P>
                                    <E T="03">Controlled technical information, covered contractor information system,</E>
                                     
                                    <E T="03">covered defense information, cyber incident,</E>
                                     
                                    <E T="03">information system,</E>
                                     and 
                                    <E T="03">technical information</E>
                                     are defined in clause 252.204-7012, Safeguarding Covered Defense Information and Cyber Incident Reporting.
                                </P>
                                <P>(b) The security requirements required by contract clause 252.204-7012, shall be implemented for all covered defense information on all covered contractor information systems that support the performance of this contract.</P>
                                <P>(c) For covered contractor information systems that are not part of an information technology service or system operated on behalf of the Government (see 252.204-7012(b)(2))—</P>
                                <P>
                                    (1) By submission of this offer, the Offeror represents that it will implement the security requirements specified by National Institute of Standards and Technology (NIST) Special Publication (SP) 800-171, “Protecting Controlled Unclassified Information in Nonfederal Information Systems and Organizations” (see 
                                    <E T="03">http://dx.doi.org/10.6028/NIST.SP.800-171</E>
                                    )that are in effect at the time the solicitation is issued or as authorized by the contracting officer, not later than December 31, 2017.
                                </P>
                                <P>(2)(i) If the Offeror proposes to vary from any of the security requirements specified by NIST SP 800-171 that are in effect at the time the solicitation is issued or as authorized by the Contracting Officer, the Offeror shall submit to the Contracting Officer, for consideration by the DoD Chief Information Officer (CIO), a written explanation of—</P>
                                <P>(A) Why a particular security requirement is not applicable; or</P>
                                <P>(B) How an alternative but equally effective, security measure is used to compensate for the inability to satisfy a particular requirement and achieve equivalent protection.</P>
                                <P>(ii) An authorized representative of the DoD CIO will adjudicate offeror requests to vary from NIST SP 800-171 requirements in writing prior to contract award. Any accepted variance from NIST SP 800-171 shall be incorporated into the resulting contract.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[80 FR 51744, Aug. 26, 2015, as amended at 80 FR 81473, Dec. 30, 2015; 81 FR 72999, Oct. 21, 2016]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.204-7009</SECTNO>
                            <SUBJECT>Limitations on the Use or Disclosure of Third-Party Contractor Reported Cyber Incident Information.</SUBJECT>
                            <P>As prescribed in 204.7304(b), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Limitations on the Use or Disclosure of Third-Party Contractor Reported Cyber Incident Information (JAN 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Compromise</E>
                                     means disclosure of information to unauthorized persons, or a violation of the security policy of a system, in which unauthorized intentional or unintentional disclosure, modification, destruction, or loss of an object, or the copying of information to unauthorized media may have occurred.
                                </P>
                                <P>
                                    <E T="03">Controlled technical information</E>
                                     means technical information with military or space application that is subject to controls on the access, use, reproduction, modification, performance, display, release, disclosure, or dissemination. Controlled technical information would meet the criteria, if disseminated, for distribution statements B through F using the criteria set forth in DoD Instruction 5230.24, Distribution Statements on 
                                    <PRTPAGE P="443"/>
                                    Technical Documents. The term does not include information that is lawfully publicly available without restrictions.
                                </P>
                                <P>
                                    <E T="03">Covered defense information</E>
                                     means unclassified controlled technical information or other information (as described in the Controlled Unclassified Information (CUI) Registry at 
                                    <E T="03">http://www.archives.gov/cui/registry/category-list.html</E>
                                    ) that requires safeguarding or dissemination controls pursuant to and consistent with law, regulations, and Governmentwide policies, and is—
                                </P>
                                <P>(1) Marked or otherwise identified in the contract, task order, or delivery order and provided to the contractor by or on behalf of DoD in support of the performance of the contract; or</P>
                                <P>(2) Collected, developed, received, transmitted, used, or stored by or on behalf of the contractor in support of the performance of the contract.</P>
                                <P>
                                    <E T="03">Cyber incident</E>
                                     means actions taken through the use of computer networks that result in a compromise or an actual or potentially adverse effect on an information system and/or the information residing therein.
                                </P>
                                <P>
                                    <E T="03">Information system</E>
                                     means a discrete set of information resources organized for the collection, processing, maintenance, use, sharing, dissemination, or disposition of information.
                                </P>
                                <P>
                                    <E T="03">Media</E>
                                     means physical devices or writing surfaces including, but is not limited to, magnetic tapes, optical disks, magnetic disks, large-scale integration memory chips, and printouts onto which covered defense information is recorded, stored, or printed within a covered contractor information system.
                                </P>
                                <P>
                                    <E T="03">Technical information</E>
                                     means technical data or computer software, as those terms are defined in the clause at DFARS 252.227-7013, Rights in Technical Data—Other Than Commercial Products and Commercial Services, regardless of whether or not the clause is incorporated in this solicitation or contract. Examples of technical information include research and engineering data, engineering drawings, and associated lists, specifications, standards, process sheets, manuals, technical reports, technical orders, catalog-item identifications, data sets, studies and analyses and related information, and computer software executable code and source code.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Restrictions.</E>
                                     The Contractor agrees that the following conditions apply to any information it receives or creates in the performance of this contract that is information obtained from a third-party's reporting of a cyber incident pursuant to DFARS clause 252.204-7012, Safeguarding Covered Defense Information and Cyber Incident Reporting (or derived from such information obtained under that clause):
                                </P>
                                <P>(1) The Contractor shall access and use the information only for the purpose of furnishing advice or technical assistance directly to the Government in support of the Government's activities related to clause 252.204-7012, and shall not be used for any other purpose.</P>
                                <P>(2) The Contractor shall protect the information against unauthorized release or disclosure.</P>
                                <P>(3) The Contractor shall ensure that its employees are subject to use and non-disclosure obligations consistent with this clause prior to the employees being provided access to or use of the information.</P>
                                <P>(4) The third-party contractor that reported the cyber incident is a third-party beneficiary of the non-disclosure agreement between the Government and Contractor, as required by paragraph (b)(3) of this clause.</P>
                                <P>(5) A breach of these obligations or restrictions may subject the Contractor to—</P>
                                <P>(i) Criminal, civil, administrative, and contractual actions in law and equity for penalties, damages, and other appropriate remedies by the United States; and</P>
                                <P>(ii) Civil actions for damages and other appropriate remedies by the third party that reported the cyber incident, as a third party beneficiary of this clause.</P>
                                <P>
                                    (c) 
                                    <E T="03">Subcontracts.</E>
                                     The Contractor shall include this clause, including this paragraph (c), in subcontracts, or similar contractual instruments, for services that include support for the Government's activities related to safeguarding covered defense information and cyber incident reporting, including subcontracts for commercial products and commercial services, without alteration, except to identify the parties.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[80 FR 51745, Aug. 26, 2015, as amended at 80 FR 81474, Dec. 30, 2015; 81 FR 73000, Oct. 21, 2016; 88 FR 6589, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.204-7010</SECTNO>
                            <SUBJECT>Requirement for Contractor To Notify DoD if the Contractor's Activities are Subject to Reporting Under the U.S.-International Atomic Energy Agency Additional Protocol.</SUBJECT>
                            <P>As prescribed in 204.470-3, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Requirement for Contractor To Notify DoD if the Contractor's Activities Are Subject to Reporting Under the U.S.-International Atomic Energy Agency Additional Protocol (JAN 2009)</HD>
                                <P>
                                    (a) If the Contractor is required to report any of its activities in accordance with Department of Commerce regulations (15 CFR part 781 
                                    <E T="03">et seq.</E>
                                    ) or Nuclear Regulatory Commission regulations (10 CFR part 75) in order to implement the declarations required by 
                                    <PRTPAGE P="444"/>
                                    the U.S.-International Atomic Energy Agency Additional Protocol (U.S.-IAEA AP), the Contractor shall—
                                </P>
                                <P>(1) Immediately provide written notification to the following DoD Program Manager:</P>
                                <P>
                                    <E T="03">[Contracting Officer to insert Program Manager's name, mailing address, e-mail address, telephone number, and facsimile number];</E>
                                </P>
                                <P>(2) Include in the notification—</P>
                                <P>(i) Where DoD contract activities or information are located relative to the activities or information to be declared to the Department of Commerce or the Nuclear Regulatory Commission; and</P>
                                <P>(ii) If or when any current or former DoD contract activities and the activities to be declared to the Department of Commerce or the Nuclear Regulatory Commission have been or will be co-located or located near enough to one another to result in disclosure of the DoD activities during an IAEA inspection or visit; and</P>
                                <P>(3) Provide a copy of the notification to the Contracting Officer.</P>
                                <P>(b) After receipt of a notification submitted in accordance with paragraph (a) of this clause, the DoD Program Manager will—</P>
                                <P>(1) Conduct a security assessment to determine if and by what means access may be granted to the IAEA; or</P>
                                <P>(2) Provide written justification to the component or agency treaty office for a national security exclusion, in accordance with DoD Instruction 2060.03, Application of the National Security Exclusion to the Agreements Between the United States of America and the International Atomic Energy Agency for the Application of Safeguards in the United States of America. DoD will notify the Contractor if a national security exclusion is applied at the Contractor's location to prohibit access by the IAEA.</P>
                                <P>(c) If the DoD Program Manager determines that a security assessment is required—</P>
                                <P>(1) DoD will, at a minimum—</P>
                                <P>(i) Notify the Contractor that DoD officials intend to conduct an assessment of vulnerabilities to IAEA inspections or visits;</P>
                                <P>(ii) Notify the Contractor of the time at which the assessment will be conducted, at least 30 days prior to the assessment;</P>
                                <P>(iii) Provide the Contractor with advance notice of the credentials of the DoD officials who will conduct the assessment; and</P>
                                <P>(iv) To the maximum extent practicable, conduct the assessment in a manner that does not impede or delay operations at the Contractor's facility; and</P>
                                <P>(2) The Contractor shall provide access to the site and shall cooperate with DoD officials in the assessment of vulnerabilities to IAEA inspections or visits.</P>
                                <P>(d) Following a security assessment of the Contractor's facility, DoD officials will notify the Contractor as to—</P>
                                <P>(1) Whether the Contractor's facility has any vulnerabilities where potentially declarable activities under the U.S.-IAEA AP are taking place;</P>
                                <P>(2) Whether additional security measures are needed; and</P>
                                <P>(3) Whether DoD will apply a national security exclusion.</P>
                                <P>(e) If DoD applies a national security exclusion, the Contractor shall not grant access to IAEA inspectors.</P>
                                <P>(f) If DoD does not apply a national security exclusion, the Contractor shall apply managed access to prevent disclosure of program activities, locations, or information in the U.S. declaration.</P>
                                <P>(g) The Contractor shall not delay submission of any reports required by the Department of Commerce or the Nuclear Regulatory Commission while awaiting a DoD response to a notification provided in accordance with this clause.</P>
                                <P>(h) The Contractor shall incorporate the substance of this clause, including this paragraph (h), in all subcontracts that are subject to the provisions of the U.S.-IAEA AP.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[74 FR 2412, Jan. 15, 2009]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.204-7011</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.204-7012</SECTNO>
                            <SUBJECT>Safeguarding Covered Defense Information and Cyber Incident Reporting.</SUBJECT>
                            <P>As prescribed in 204.7304(c), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Safeguarding Covered Defense Information and Cyber Incident Reporting (MAY 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Adequate security</E>
                                     means protective measures that are commensurate with the consequences and probability of loss, misuse, or unauthorized access to, or modification of information.
                                </P>
                                <P>
                                    <E T="03">Compromise</E>
                                     means disclosure of information to unauthorized persons, or a violation of the security policy of a system, in which unauthorized intentional or unintentional disclosure, modification, destruction, or loss of an object, or the copying of information to unauthorized media may have occurred.
                                </P>
                                <P>
                                    <E T="03">Contractor attributional/proprietary information</E>
                                     means information that identifies the contractor(s), whether directly or indirectly, by the grouping of information that can be traced back to the contractor(s) (
                                    <E T="03">e.g.,</E>
                                     program description, facility locations), personally identifiable information, as well as trade secrets, commercial or financial information, or other commercially sensitive information that is not customarily shared outside of the company.
                                    <PRTPAGE P="445"/>
                                </P>
                                <P>
                                    <E T="03">Controlled technical information</E>
                                     means technical information with military or space application that is subject to controls on the access, use, reproduction, modification, performance, display, release, disclosure, or dissemination. Controlled technical information would meet the criteria, if disseminated, for distribution statements B through F using the criteria set forth in DoD Instruction 5230.24, Distribution Statements on Technical Documents. The term does not include information that is lawfully publicly available without restrictions.
                                </P>
                                <P>
                                    <E T="03">Covered contractor information system</E>
                                     means an unclassified information system that is owned, or operated by or for, a contractor and that processes, stores, or transmits covered defense information.
                                </P>
                                <P>
                                    <E T="03">Covered defense information</E>
                                     means unclassified controlled technical information or other information, as described in the Controlled Unclassified Information (CUI) Registry at 
                                    <E T="03">http://www.archives.gov/cui/registry/category-list.html,</E>
                                     that requires safeguarding or dissemination controls pursuant to and consistent with law, regulations, and Governmentwide policies, and is—
                                </P>
                                <P>(1) Marked or otherwise identified in the contract, task order, or delivery order and provided to the contractor by or on behalf of DoD in support of the performance of the contract; or</P>
                                <P>(2) Collected, developed, received, transmitted, used, or stored by or on behalf of the contractor in support of the performance of the contract.</P>
                                <P>
                                    <E T="03">Cyber incident</E>
                                     means actions taken through the use of computer networks that result in a compromise or an actual or potentially adverse effect on an information system and/or the information residing therein.
                                </P>
                                <P>
                                    <E T="03">Forensic analysis</E>
                                     means the practice of gathering, retaining, and analyzing computer-related data for investigative purposes in a manner that maintains the integrity of the data.
                                </P>
                                <P>
                                    <E T="03">Information system</E>
                                     means a discrete set of information resources organized for the collection, processing, maintenance, use, sharing, dissemination, or disposition of information.
                                </P>
                                <P>
                                    <E T="03">Malicious software</E>
                                     means computer software or firmware intended to perform an unauthorized process that will have adverse impact on the confidentiality, integrity, or availability of an information system. This definition includes a virus, worm, Trojan horse, or other code-based entity that infects a host, as well as spyware and some forms of adware.
                                </P>
                                <P>
                                    <E T="03">Media</E>
                                     means physical devices or writing surfaces including, but is not limited to, magnetic tapes, optical disks, magnetic disks, large-scale integration memory chips, and printouts onto which covered defense information is recorded, stored, or printed within a covered contractor information system.
                                </P>
                                <P>
                                    <E T="03">Operationally critical support</E>
                                     means supplies or services designated by the Government as critical for airlift, sealift, intermodal transportation services, or logistical support that is essential to the mobilization, deployment, or sustainment of the Armed Forces in a contingency operation.
                                </P>
                                <P>
                                    <E T="03">Rapidly report</E>
                                     means within 72 hours of discovery of any cyber incident.
                                </P>
                                <P>
                                    <E T="03">Technical information</E>
                                     means technical data or computer software, as those terms are defined in the clause at DFARS 
                                    <E T="03">252.227-7013,</E>
                                     Rights in Technical Data—Other Than Commercial Products and Commercial Services, regardless of whether or not the clause is incorporated in this solicitation or contract. Examples of technical information include research and engineering data, engineering drawings, and associated lists, specifications, standards, process sheets, manuals, technical reports, technical orders, catalog-item identifications, data sets, studies and analyses and related information, and computer software executable code and source code.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Adequate security.</E>
                                     The Contractor shall provide adequate security on all covered contractor information systems. To provide adequate security, the Contractor shall implement, at a minimum, the following information security protections:
                                </P>
                                <P>(1) For covered contractor information systems that are part of an information technology (IT) service or system operated on behalf of the Government, the following security requirements apply:</P>
                                <P>(i) Cloud computing services shall be subject to the security requirements specified in the clause 252.239-7010, Cloud Computing Services, of this contract.</P>
                                <P>
                                    (ii) Any other such IT service or system (
                                    <E T="03">i.e.,</E>
                                     other than cloud computing) shall be subject to the security requirements specified elsewhere in this contract.
                                </P>
                                <P>(2) For covered contractor information systems that are not part of an IT service or system operated on behalf of the Government and therefore are not subject to the security requirement specified at paragraph (b)(1) of this clause, the following security requirements apply:</P>
                                <P>
                                    (i) Except as provided in paragraph (b)(2)(ii) of this clause, the covered contractor information system shall be subject to the security requirements in National Institute of Standards and Technology (NIST) Special Publication (SP) 800-171, “Protecting Controlled Unclassified Information in Nonfederal Information Systems and Organizations” (available via the internet at 
                                    <E T="03">https://csrc.nist.gov/publications/sp800</E>
                                    ) in effect at the time the solicitation is issued or as authorized by the Contracting Officer.
                                </P>
                                <P>
                                    (ii)(A) The Contractor shall implement NIST SP 800-171, as soon as practical, but 
                                    <PRTPAGE P="446"/>
                                    not later than December 31, 2017. For all contracts awarded prior to October 1, 2017, the Contractor shall notify the DoD Chief Information Officer (CIO), via email at 
                                    <E T="03">osd.dibcsia@mail.mil,</E>
                                     within 30 days of contract award, of any security requirements specified by NIST SP 800-171 not implemented at the time of contract award.
                                </P>
                                <P>(B) The Contractor shall submit requests to vary from NIST SP 800-171 in writing to the Contracting Officer, for consideration by the DoD CIO. The Contractor need not implement any security requirement adjudicated by an authorized representative of the DoD CIO to be nonapplicable or to have an alternative, but equally effective, security measure that may be implemented in its place.</P>
                                <P>(C) If the DoD CIO has previously adjudicated the contractor's requests indicating that a requirement is not applicable or that an alternative security measure is equally effective, a copy of that approval shall be provided to the Contracting Officer when requesting its recognition under this contract.</P>
                                <P>
                                    (D) If the Contractor intends to use an external cloud service provider to store, process, or transmit any covered defense information in performance of this contract, the Contractor shall require and ensure that the cloud service provider meets security requirements equivalent to those established by the Government for the Federal Risk and Authorization Management Program (FedRAMP) Moderate baseline (
                                    <E T="03">https://www.fedramp.gov/documents-templates/</E>
                                    ) and that the cloud service provider complies with requirements in paragraphs (c) through (g) of this clause for cyber incident reporting, malicious software, media preservation and protection, access to additional information and equipment necessary for forensic analysis, and cyber incident damage assessment.
                                </P>
                                <P>
                                    (3) Apply other information systems security measures when the Contractor reasonably determines that information systems security measures, in addition to those identified in paragraphs (b)(1) and (2) of this clause, may be required to provide adequate security in a dynamic environment or to accommodate special circumstances (
                                    <E T="03">e.g.,</E>
                                     medical devices) and any individual, isolated, or temporary deficiencies based on an assessed risk or vulnerability. These measures may be addressed in a system security plan.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Cyber incident reporting requirement.</E>
                                </P>
                                <P>(1) When the Contractor discovers a cyber incident that affects a covered contractor information system or the covered defense information residing therein, or that affects the contractor's ability to perform the requirements of the contract that are designated as operationally critical support and identified in the contract, the Contractor shall—</P>
                                <P>(i) Conduct a review for evidence of compromise of covered defense information, including, but not limited to, identifying compromised computers, servers, specific data, and user accounts. This review shall also include analyzing covered contractor information system(s) that were part of the cyber incident, as well as other information systems on the Contractor's network(s), that may have been accessed as a result of the incident in order to identify compromised covered defense information, or that affect the Contractor's ability to provide operationally critical support; and</P>
                                <P>
                                    (ii) Rapidly report cyber incidents to DoD at 
                                    <E T="03"> https://dibnet.dod.mil.</E>
                                </P>
                                <P>
                                    (2) 
                                    <E T="03">Cyber incident report.</E>
                                     The cyber incident report shall be treated as information created by or for DoD and shall include, at a minimum, the required elements at 
                                    <E T="03">https://dibnet.dod.mil.</E>
                                </P>
                                <P>
                                    (3) 
                                    <E T="03">Medium assurance certificate requirement.</E>
                                     In order to report cyber incidents in accordance with this clause, the Contractor or subcontractor shall have or acquire a DoD-approved medium assurance certificate to report cyber incidents. For information on obtaining a DoD-approved medium assurance certificate, see 
                                    <E T="03">https://public.cyber.mil/eca/</E>
                                    .
                                </P>
                                <P>
                                    (d) 
                                    <E T="03">Malicious software.</E>
                                     When the Contractor or subcontractors discover and isolate malicious software in connection with a reported cyber incident, submit the malicious software to DoD Cyber Crime Center (DC3) in accordance with instructions provided by DC3 or the Contracting Officer. Do not send the malicious software to the Contracting Officer.
                                </P>
                                <P>
                                    (e) 
                                    <E T="03">Media preservation and protection.</E>
                                     When a Contractor discovers a cyber incident has occurred, the Contractor shall preserve and protect images of all known affected information systems identified in paragraph (c)(1)(i) of this clause and all relevant monitoring/packet capture data for at least 90 days from the submission of the cyber incident report to allow DoD to request the media or decline interest.
                                </P>
                                <P>
                                    (f) 
                                    <E T="03">Access to additional information or equipment necessary for forensic analysis.</E>
                                     Upon request by DoD, the Contractor shall provide DoD with access to additional information or equipment that is necessary to conduct a forensic analysis.
                                </P>
                                <P>
                                    (g) 
                                    <E T="03">Cyber incident damage assessment activities.</E>
                                     If DoD elects to conduct a damage assessment, the Contracting Officer will request that the Contractor provide all of the damage assessment information gathered in accordance with paragraph (e) of this clause.
                                </P>
                                <P>
                                    (h) 
                                    <E T="03">DoD safeguarding and use of contractor attributional/proprietary information.</E>
                                     The Government shall protect against the unauthorized use or release of information obtained from the contractor (or derived from information obtained from the contractor) under this clause that includes contractor 
                                    <PRTPAGE P="447"/>
                                    attributional/proprietary information, including such information submitted in accordance with paragraph (c). To the maximum extent practicable, the Contractor shall identify and mark attributional/proprietary information. In making an authorized release of such information, the Government will implement appropriate procedures to minimize the contractor attributional/proprietary information that is included in such authorized release, seeking to include only that information that is necessary for the authorized purpose(s) for which the information is being released.
                                </P>
                                <P>
                                    (i) 
                                    <E T="03">Use and release of contractor attributional/proprietary information not created by or for DoD.</E>
                                     Information that is obtained from the contractor (or derived from information obtained from the contractor) under this clause that is not created by or for DoD is authorized to be released outside of DoD—
                                </P>
                                <P>(1) To entities with missions that may be affected by such information;</P>
                                <P>(2) To entities that may be called upon to assist in the diagnosis, detection, or mitigation of cyber incidents;</P>
                                <P>(3) To Government entities that conduct counterintelligence or law enforcement investigations;</P>
                                <P>(4) For national security purposes, including cyber situational awareness and defense purposes (including with Defense Industrial Base (DIB) participants in the program at 32 CFR part 236); or</P>
                                <P>(5) To a support services contractor (“recipient”) that is directly supporting Government activities under a contract that includes the clause at 252.204-7009, Limitations on the Use or Disclosure of Third-Party Contractor Reported Cyber Incident Information.</P>
                                <P>
                                    (j) 
                                    <E T="03">Use and release of contractor attributional/proprietary information created by or for DoD.</E>
                                     Information that is obtained from the contractor (or derived from information obtained from the contractor) under this clause that is created by or for DoD (including the information submitted pursuant to paragraph (c) of this clause) is authorized to be used and released outside of DoD for purposes and activities authorized by paragraph (i) of this clause, and for any other lawful Government purpose or activity, subject to all applicable statutory, regulatory, and policy based restrictions on the Government's use and release of such information.
                                </P>
                                <P>(k) The Contractor shall conduct activities under this clause in accordance with applicable laws and regulations on the interception, monitoring, access, use, and disclosure of electronic communications and data.</P>
                                <P>
                                    (l) 
                                    <E T="03">Other safeguarding or reporting requirements.</E>
                                     The safeguarding and cyber incident reporting required by this clause in no way abrogates the Contractor's responsibility for other safeguarding or cyber incident reporting pertaining to its unclassified information systems as required by other applicable clauses of this contract, or as a result of other applicable U.S. Government statutory or regulatory requirements.
                                </P>
                                <P>
                                    (m) 
                                    <E T="03">Subcontracts.</E>
                                     The Contractor shall—
                                </P>
                                <P>(1) Include this clause, including this paragraph (m), in subcontracts, or similar contractual instruments, for operationally critical support, or for which subcontract performance will involve covered defense information, including subcontracts for commercial products or commercial services, without alteration, except to identify the parties. The Contractor shall determine if the information required for subcontractor performance retains its identity as covered defense information and will require protection under this clause, and, if necessary, consult with the Contracting Officer; and</P>
                                <P>(2) Require subcontractors to—</P>
                                <P>(i) Notify the prime Contractor (or next higher-tier subcontractor) when submitting a request to vary from a NIST SP 800-171 security requirement to the Contracting Officer, in accordance with paragraph (b)(2)(ii)(B) of this clause; and</P>
                                <P>(ii) Provide the incident report number, automatically assigned by DoD, to the prime Contractor (or next higher-tier subcontractor) as soon as practicable, when reporting a cyber incident to DoD as required in paragraph (c) of this clause.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[80 FR 51745, Aug. 26, 2015, as amended at 80 FR 56930, Sept. 21, 2015; 80 FR 81474, Dec. 30, 2015; 81 FR 73000, Oct. 21, 2016; 84 FR 72563, Dec. 31, 2019; 88 FR 6589, Jan. 31, 2023; 89 FR 46821, May 30, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.204-7013</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.204-7014</SECTNO>
                            <SUBJECT>Limitations on the Use or Disclosure of Information by Litigation Support Contractors.</SUBJECT>
                            <P>As prescribed in 204.7403(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Limitations on the Use or Disclosure of Information by Litigation Support Contractors (JAN 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Computer software</E>
                                     means computer programs, source code, source code listings, object code listings, design details, algorithms, processes, flow charts, formulae, and related material that would enable the software to be reproduced, recreated, or recompiled. Computer software does not include computer data bases or computer software documentation.
                                </P>
                                <P>
                                    <E T="03">Litigation information</E>
                                     means any information, including sensitive information, that is furnished to the contractor by or on behalf of the Government, or that is generated or 
                                    <PRTPAGE P="448"/>
                                    obtained by the contractor in the performance of litigation support under a contract. The term does not include information that is lawfully, publicly available without restriction, including information contained in a publicly available solicitation.
                                </P>
                                <P>
                                    <E T="03">Litigation support</E>
                                     means administrative, technical, or professional services provided in support of the Government during or in anticipation of litigation.
                                </P>
                                <P>
                                    <E T="03">Litigation support contractor</E>
                                     means a contractor (including its experts, technical consultants, subcontractors, and suppliers) providing litigation support under a contract that contains this clause.
                                </P>
                                <P>
                                    <E T="03">Sensitive information</E>
                                     means controlled unclassified information of a commercial, financial, proprietary, or privileged nature. The term includes technical data and computer software, but does not include information that is lawfully, publicly available without restriction.
                                </P>
                                <P>
                                    <E T="03">Technical data</E>
                                     means recorded information, regardless of the form or method of the recording, of a scientific or technical nature (including computer software documentation). The term does not include computer software or data incidental to contract administration, such as financial and/or management information.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Limitations on use or disclosure of litigation information.</E>
                                     Notwithstanding any other provision of this contract, the Contractor shall—
                                </P>
                                <P>(1) Access and use litigation information only for the purpose of providing litigation support under this contract;</P>
                                <P>(2) Not disclose litigation information to any entity outside the Contractor's organization unless, prior to such disclosure the Contracting Officer has provided written consent to such disclosure;</P>
                                <P>(3) Take all precautions necessary to prevent unauthorized disclosure of litigation information;</P>
                                <P>(4) Not use litigation information to compete against a third party for Government or nongovernment contracts; and</P>
                                <P>(5) Upon completion of the authorized litigation support activities, destroy or return to the Government at the request of the Contracting Officer all litigation information in its possession.</P>
                                <P>(c) Violation of paragraph (b)(1),(b)(2), (b)(3), (b)(4), or (b)(5) of this clause is a basis for the Government to terminate this contract.</P>
                                <P>
                                    (d) 
                                    <E T="03">Indemnification and creation of third party beneficiary rights.</E>
                                     The Contractor agrees—
                                </P>
                                <P>(1) To indemnify and hold harmless the Government, its agents, and employees from any claim or liability, including attorneys' fees, court costs, and expenses, arising out of, or in any way related to, the misuse or unauthorized modification, reproduction, release, performance, display, or disclosure of any litigation information; and</P>
                                <P>(2) That any third party holding proprietary rights or any other legally protectable interest in any litigation information, in addition to any other rights it may have, is a third party beneficiary under this contract who shall have a right of direct action against the Contractor, and against any person to whom the Contractor has released or disclosed such litigation information, for any such unauthorized use or disclosure of such information.</P>
                                <P>
                                    (e) 
                                    <E T="03">Contractor</E>
                                     
                                    <E T="03">employees.</E>
                                     The Contractor shall ensure that its employees are subject to use and nondisclosure obligations consistent with this clause prior to the employees being provided access to or use of any litigation information covered by this clause.
                                </P>
                                <P>
                                    (f) 
                                    <E T="03">Subcontracts.</E>
                                     Include the substance of this clause, including this paragraph (f), in all subcontracts, including subcontracts for commercial products or commercial services.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[79 FR 11340, Feb. 28, 2014, as amended at 81 FR 28729, May 10, 2016; 84 FR 58332, Oct. 31, 2019; 88 FR 6589, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.204-7015</SECTNO>
                            <SUBJECT>Notice of Authorized Disclosure of Information for Litigation Support.</SUBJECT>
                            <P>As prescribed in 204.7403(b), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Notice of Authorized Disclosure of Information for Litigation Support (JAN 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Computer software</E>
                                     means computer programs, source code, source code listings, object code listings, design details, algorithms, processes, flow charts, formulae, and related material that would enable the software to be reproduced, recreated, or recompiled. Computer software does not include computer data bases or computer software documentation.
                                </P>
                                <P>
                                    <E T="03">Litigation support</E>
                                     means administrative, technical, or professional services provided in support of the Government during or in anticipation of litigation.
                                </P>
                                <P>
                                    <E T="03">Litigation support contractor</E>
                                     means a contractor (including its experts, technical consultants, subcontractors, and suppliers) providing litigation support under a contract that contains the clause at 252.204-7014, Limitations on the Use or Disclosure of Information by Litigation Support Contractors.
                                </P>
                                <P>
                                    <E T="03">Sensitive information</E>
                                     means controlled unclassified information of a commercial, financial, proprietary, or privileged nature. 
                                    <PRTPAGE P="449"/>
                                    The term includes technical data and computer software, but does not include information that is lawfully, publicly available without restriction.
                                </P>
                                <P>
                                    <E T="03">Technical data</E>
                                     means recorded information, regardless of the form or method of the recording, of a scientific or technical nature (including computer software documentation). The term does not include computer software or data incidental to contract administration, such as financial and/or management information.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Notice of authorized disclosures</E>
                                     Notwithstanding any other provision of this solicitation or contract, the Government may disclose to a litigation support contractor, for the sole purpose of litigation support activities, any information, including sensitive information, received—
                                </P>
                                <P>(1) Within or in connection with a quotation or offer; or</P>
                                <P>(2) In the performance of or in connection with a contract.</P>
                                <P>
                                    (c) 
                                    <E T="03">Subcontracts.</E>
                                     Include the substance of this clause, including this paragraph (c), in all subcontracts, including subcontracts for commercial products or commercial services.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[79 FR 11341, Feb. 28, 2014, as amended at 81 FR 28729, May 10, 2016; 84 FR 58332, Oct. 31, 2019; 88 FR 6589, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.204-7016</SECTNO>
                            <SUBJECT>Covered Defense Telecommunications Equipment or Services—Representation.</SUBJECT>
                            <P>As prescribed in 204.2105(a), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Covered Defense Telecommunications Equipment or Services—Representation (DEC 2019)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this provision, 
                                    <E T="03">covered defense telecommunications equipment or services</E>
                                     has the meaning provided in the clause 252.204-7018, Prohibition on the Acquisition of Covered Defense Telecommunications Equipment or Services.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Procedures.</E>
                                     The Offeror shall review the list of excluded parties in the System for Award Management (SAM) (
                                    <E T="03">https://www.sam.gov</E>
                                    ) for entities excluded from receiving federal awards for “covered defense telecommunications equipment or services”.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Representation.</E>
                                     The Offeror represents that it [ ] does, [ ] does not provide covered defense telecommunications equipment or services as a part of its offered products or services to the Government in the performance of any contract, subcontract, or other contractual instrument.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[84 FR 72237, Dec. 31, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.204-7017</SECTNO>
                            <SUBJECT>Prohibition on the Acquisition of Covered Defense Telecommunications Equipment or Services—Representation.</SUBJECT>
                            <P>As prescribed in 204.2105(b), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Prohibition on the Acquisition of Covered Defense Telecommunications Equipment or Services—Representation (May 2021)</HD>
                                <P>The Offeror is not required to complete the representation in this provision if the Offeror has represented in the provision at 252.204-7016, Covered Defense Telecommunications Equipment or Services—Representation, that it “does not provide covered defense telecommunications equipment or services as a part of its offered products or services to the Government in the performance of any contract, subcontract, or other contractual instrument.”</P>
                                <P>
                                    (a) 
                                    <E T="03">Definitions. Covered defense telecommunications equipment or services, covered mission, critical technology,</E>
                                     and 
                                    <E T="03">substantial or essential component,</E>
                                     as used in this provision, have the meanings given in the 252.204-7018 clause, Prohibition on the Acquisition of Covered Defense Telecommunications Equipment or Services, of this solicitation.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Prohibition.</E>
                                     Section 1656 of the National Defense Authorization Act for Fiscal Year 2018 (Pub. L. 115-91) prohibits agencies from procuring or obtaining, or extending or renewing a contract to procure or obtain, any equipment, system, or service to carry out covered missions that uses covered defense telecommunications equipment or services as a substantial or essential component of any system, or as critical technology as part of any system.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Procedures.</E>
                                     The Offeror shall review the list of excluded parties in the System for Award Management (SAM) at 
                                    <E T="03">https://www.sam.gov</E>
                                     for entities that are excluded when providing any equipment, system, or service to carry out covered missions that uses covered defense telecommunications equipment or services as a substantial or essential component of any system, or as critical technology as part of any system, unless a waiver is granted.
                                </P>
                                <P>
                                    (d) 
                                    <E T="03">Representation.</E>
                                     If in its annual representations and certifications in SAM the Offeror has represented in paragraph (c) of the provision at 252.204-7016, Covered Defense Telecommunications Equipment or Services—Representation, that it “does” provide covered defense telecommunications equipment or services as a part of its offered products or services to the Government in the performance of any contract, subcontract, or other contractual instrument, then the Offeror 
                                    <PRTPAGE P="450"/>
                                    shall complete the following additional representation:
                                </P>
                                <P>The Offeror represents that it [ ] will [ ] will not provide covered defense telecommunications equipment or services as a part of its offered products or services to DoD in the performance of any award resulting from this solicitation.</P>
                                <P>
                                    (e) 
                                    <E T="03">Disclosures.</E>
                                     If the Offeror has represented in paragraph (d) of this provision that it “will provide covered defense telecommunications equipment or services,” the Offeror shall provide the following information as part of the offer:
                                </P>
                                <P>(1) A description of all covered defense telecommunications equipment and services offered (include brand or manufacturer; product, such as model number, original equipment manufacturer (OEM) number, manufacturer part number, or wholesaler number; and item description, as applicable).</P>
                                <P>(2) An explanation of the proposed use of covered defense telecommunications equipment and services and any factors relevant to determining if such use would be permissible under the prohibition referenced in paragraph (b) of this provision.</P>
                                <P>(3) For services, the entity providing the covered defense telecommunications services (include entity name, unique entity identifier, and Commercial and Government Entity (CAGE) code, if known).</P>
                                <P>(4) For equipment, the entity that produced or provided the covered defense telecommunications equipment (include entity name, unique entity identifier, CAGE code, and whether the entity was the OEM or a distributor, if known).</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[84 FR 72237, Dec. 31, 2019, as amended at 86 FR 27278, May 20, 2021]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.204-7018</SECTNO>
                            <SUBJECT>Prohibition on the Acquisition of Covered Defense Telecommunications Equipment or Services.</SUBJECT>
                            <P>As prescribed in 204.2105(c), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Prohibition on the Acquisition of Covered Defense Telecommunications Equipment or Services (JAN 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Covered defense telecommunications equipment or services</E>
                                     means—
                                </P>
                                <P>(1) Telecommunications equipment produced by Huawei Technologies Company or ZTE Corporation, or any subsidiary or affiliate of such entities;</P>
                                <P>(2) Telecommunications services provided by such entities or using such equipment; or</P>
                                <P>(3) Telecommunications equipment or services produced or provided by an entity that the Secretary of Defense reasonably believes to be an entity owned or controlled by, or otherwise connected to, the government of a covered foreign country.</P>
                                <P>
                                    <E T="03">Covered foreign country</E>
                                     means—
                                </P>
                                <P>(1) The People's Republic of China; or</P>
                                <P>(2) The Russian Federation.</P>
                                <P>
                                    <E T="03">Covered missions</E>
                                     means—
                                </P>
                                <P>(1) The nuclear deterrence mission of DoD, including with respect to nuclear command, control, and communications, integrated tactical warning and attack assessment, and continuity of Government; or</P>
                                <P>(2) The homeland defense mission of DoD, including with respect to ballistic missile defense.</P>
                                <P>“Critical technology” means—</P>
                                <P>(1) Defense articles or defense services included on the United States Munitions List set forth in the International Traffic in Arms Regulations under subchapter M of chapter I of title 22, Code of Federal Regulations;</P>
                                <P>(2) Items included on the Commerce Control List set forth in Supplement No. 1 to part 774 of the Export Administration Regulations under subchapter C of chapter VII of title 15, Code of Federal Regulations, and controlled—</P>
                                <P>(i) Pursuant to multilateral regimes, including for reasons relating to national security, chemical and biological weapons proliferation, nuclear nonproliferation, or missile technology; or</P>
                                <P>(ii) For reasons relating to regional stability or surreptitious listening;</P>
                                <P>(3) Specially designed and prepared nuclear equipment, parts and components, materials, software, and technology covered by part 810 of title 10, Code of Federal Regulations (relating to assistance to foreign atomic energy activities);</P>
                                <P>(4) Nuclear facilities, equipment, and material covered by part 110 of title 10, Code of Federal Regulations (relating to export and import of nuclear equipment and material);</P>
                                <P>(5) Select agents and toxins covered by part 331 of title 7, Code of Federal Regulations, part 121 of title 9 of such Code, or part 73 of title 42 of such Code; or</P>
                                <P>(6) Emerging and foundational technologies controlled pursuant to section 1758 of the Export Control Reform Act of 2018 (50 U.S.C. 4817).</P>
                                <P>
                                    <E T="03">Substantial or essential component</E>
                                     means any component necessary for the proper function or performance of a piece of equipment, system, or service.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Prohibition.</E>
                                     In accordance with section 1656 of the National Defense Authorization Act for Fiscal Year 2018 (Pub. L. 115-91), the contractor shall not provide to the Government any equipment, system, or service to carry out covered missions that uses covered defense telecommunications equipment or services as a substantial or essential component of any system, or as critical technology 
                                    <PRTPAGE P="451"/>
                                    as part of any system, unless the covered defense telecommunication equipment or services are covered by a waiver described in Defense Federal Acquisition Regulation Supplement 204.2104.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Procedures.</E>
                                     The Contractor shall review the list of excluded parties in the System for Award Management (SAM) at 
                                    <E T="03">https://www.sam.gov</E>
                                     for entities that are excluded when providing any equipment, system, or service, to carry out covered missions, that uses covered defense telecommunications equipment or services as a substantial or essential component of any system, or as critical technology as part of any system, unless a waiver is granted.
                                </P>
                                <P>
                                    (d) 
                                    <E T="03">Reporting.</E>
                                     (1) In the event the Contractor identifies covered defense telecommunications equipment or services used as a substantial or essential component of any system, or as critical technology as part of any system, during contract performance, the Contractor shall report at 
                                    <E T="03">https://dibnet.dod.mil</E>
                                     the information in paragraph (d)(2) of this clause.
                                </P>
                                <P>(2) The Contractor shall report the following information pursuant to paragraph (d)(1) of this clause:</P>
                                <P>(i) Within 3 business days from the date of such identification or notification: The contract number; the order number(s), if applicable; supplier name; brand; model number (original equipment manufacturer number, manufacturer part number, or wholesaler number); item description; and any readily available information about mitigation actions undertaken or recommended.</P>
                                <P>(ii) Within 30 business days of submitting the information in paragraph (d)(2)(i) of this clause: Any further available information about mitigation actions undertaken or recommended. In addition, the Contractor shall describe the efforts it undertook to prevent use or submission of a covered defense telecommunications equipment or services, and any additional efforts that will be incorporated to prevent future use or submission of covered telecommunications equipment or services.</P>
                                <P>
                                    (e) 
                                    <E T="03">Subcontracts.</E>
                                     The Contractor shall insert the substance of this clause, including this paragraph (e), in all subcontracts and other contractual instruments, including subcontracts for the acquisition of commercial products or commercial services.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[84 FR 72237, Dec. 31, 2019, as amended at 86 FR 3835, Jan. 15, 2021; 88 FR 6589, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.204-7019</SECTNO>
                            <SUBJECT>Notice of NIST SP 800-171 DoD Assessment Requirements.</SUBJECT>
                            <P>As prescribed in 204.7304(d), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">NOTICE OF NIST SP 800-171 DOD ASSESSMENT REQUIREMENTS (NOV 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                </P>
                                <P>
                                    <E T="03">Basic Assessment, Medium</E>
                                     Assessment, and 
                                    <E T="03">High Assessment</E>
                                     have the meaning given in the clause 252.204-7020, NIST SP 800-171 DoD Assessments.
                                </P>
                                <P>
                                    <E T="03">Covered contractor information system</E>
                                     has the meaning given in the clause 252.204-7012, Safeguarding Covered Defense Information and Cyber Incident Reporting, of this solicitation.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Requirement.</E>
                                     In order to be considered for award, if the Offeror is required to implement NIST SP 800-171, the Offeror shall have a current assessment (
                                    <E T="03">i.e.,</E>
                                     not more than 3 years old unless a lesser time is specified in the solicitation) (see 252.204-7020) for each covered contractor information system that is relevant to the offer, contract, task order, or delivery order. The Basic, Medium, and High NIST SP 800-171 DoD Assessments are described in the NIST SP 800-171 DoD Assessment Methodology located at 
                                    <E T="03">https://www.acq.osd.mil/asda/dpc/cp/cyber/docs/safeguarding/NIST-SP-800-171-Assessment-Methodology-Version-1.2.1-6.24.2020.pdf</E>
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Procedures.</E>
                                     (1) The Offeror shall verify that summary level scores of a current NIST SP 800-171 DoD Assessment (
                                    <E T="03">i.e.,</E>
                                     not more than 3 years old unless a lesser time is specified in the solicitation) are posted in the Supplier Performance Risk System (SPRS) (
                                    <E T="03">https://www.sprs.csd.disa.mil/</E>
                                    ) for all covered contractor information systems relevant to the offer.
                                </P>
                                <P>
                                    (2) If the Offeror does not have summary level scores of a current NIST SP 800-171 DoD Assessment (
                                    <E T="03">i.e.,</E>
                                     not more than 3 years old unless a lesser time is specified in the solicitation) posted in SPRS, the Offeror may conduct and submit a Basic Assessment to 
                                    <E T="03">webptsmh@navy.mil</E>
                                     for posting to SPRS in the format identified in paragraph (d) of this provision.
                                </P>
                                <P>
                                    (d) 
                                    <E T="03">Summary level scores.</E>
                                     Summary level scores for all assessments will be posted 30 days post-assessment in SPRS to provide DoD Components visibility into the summary level scores of strategic assessments.
                                </P>
                                <P>
                                    (1) 
                                    <E T="03">Basic Assessments.</E>
                                     An Offeror may follow the procedures in paragraph (c)(2) of this provision for posting Basic Assessments to SPRS.
                                </P>
                                <P>(i) The email shall include the following information:</P>
                                <P>
                                    (A) Cybersecurity standard assessed (
                                    <E T="03">e.g.,</E>
                                     NIST SP 800-171 Rev 1).
                                </P>
                                <P>
                                    (B) Organization conducting the assessment (
                                    <E T="03">e.g.,</E>
                                     Contractor self-assessment).
                                </P>
                                <P>(C) For each system security plan (security requirement 3.12.4) supporting the performance of a DoD contract—</P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) All industry Commercial and Government Entity (CAGE) code(s) associated with 
                                    <PRTPAGE P="452"/>
                                    the information system(s) addressed by the system security plan; and
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) A brief description of the system security plan architecture, if more than one plan exists.
                                </P>
                                <P>(D) Date the assessment was completed.</P>
                                <P>
                                    (E) Summary level score (
                                    <E T="03">e.g.,</E>
                                     95 out of 110, NOT the individual value for each requirement).
                                </P>
                                <P>
                                    (F) Date that all requirements are expected to be implemented (
                                    <E T="03">i.e.,</E>
                                     a score of 110 is expected to be achieved) based on information gathered from associated plan(s) of action developed in accordance with NIST SP 800-171.
                                </P>
                                <P>(ii) If multiple system security plans are addressed in the email described at paragraph (d)(1)(i) of this section, the Offeror shall use the following format for the report:</P>
                                <GPOTABLE COLS="6" OPTS="L2" CDEF="s50,xl50,xl50,xl50,xl25,xl50">
                                    <BOXHD>
                                        <CHED H="1">System security plan</CHED>
                                        <CHED H="1">CAGE codes supported by this plan</CHED>
                                        <CHED H="1">Brief description of the plan architecture</CHED>
                                        <CHED H="1">
                                            Date of
                                            <LI>assessment</LI>
                                        </CHED>
                                        <CHED H="1">Total score</CHED>
                                        <CHED H="1">Date score of 110 will achieved</CHED>
                                    </BOXHD>
                                    <ROW RUL="s">
                                        <ENT I="22"> </ENT>
                                        <ENT/>
                                        <ENT/>
                                        <ENT/>
                                    </ROW>
                                    <ROW RUL="s">
                                        <ENT I="22"> </ENT>
                                        <ENT/>
                                        <ENT/>
                                        <ENT/>
                                    </ROW>
                                    <ROW>
                                        <ENT I="22"> </ENT>
                                        <ENT/>
                                        <ENT/>
                                        <ENT/>
                                        <ENT/>
                                        <ENT/>
                                    </ROW>
                                </GPOTABLE>
                                <P>
                                    (2) 
                                    <E T="03">Medium and High Assessments.</E>
                                     DoD will post the following Medium and/or High Assessment summary level scores to SPRS for each system assessed:
                                </P>
                                <P>
                                    (i) The standard assessed (
                                    <E T="03">e.g.,</E>
                                     NIST SP 800-171 Rev 1).
                                </P>
                                <P>
                                    (ii) Organization conducting the assessment, 
                                    <E T="03">e.g.,</E>
                                     DCMA, or a specific organization (identified by Department of Defense Activity Address Code (DoDAAC)).
                                </P>
                                <P>(iii) All industry CAGE code(s) associated with the information system(s) addressed by the system security plan.</P>
                                <P>(iv) A brief description of the system security plan architecture, if more than one system security plan exists.</P>
                                <P>
                                    (v) Date and level of the assessment, 
                                    <E T="03">i.e.,</E>
                                     medium or high.
                                </P>
                                <P>
                                    (vi) Summary level score (
                                    <E T="03">e.g.,</E>
                                     105 out of 110, not the individual value assigned for each requirement).
                                </P>
                                <P>
                                    (vii) Date that all requirements are expected to be implemented (
                                    <E T="03">i.e.,</E>
                                     a score of 110 is expected to be achieved) based on information gathered from associated plan(s) of action developed in accordance with NIST SP 800-171.
                                </P>
                                <P>
                                    (3) 
                                    <E T="03">Accessibility.</E>
                                     (i) Assessment summary level scores posted in SPRS are available to DoD personnel, and are protected, in accordance with the standards set forth in DoD Instruction 5000.79, Defense-wide Sharing and Use of Supplier and Product Performance Information (PI).
                                </P>
                                <P>
                                    (ii) Authorized representatives of the Offeror for which the assessment was conducted may access SPRS to view their own summary level scores, in accordance with the SPRS Software User's Guide for Awardees/Contractors available at 
                                    <E T="03">https://www.sprs.csd.disa.mil/pdf/SPRS_Awardee.pdf.</E>
                                </P>
                                <P>
                                    (iii) A High NIST SP 800-171 DoD Assessment may result in documentation in addition to that listed in this section. DoD will retain and protect any such documentation as “Controlled Unclassified Information (CUI)” and intended for internal DoD use only. The information will be protected against unauthorized use and release, including through the exercise of applicable exemptions under the Freedom of Information Act (
                                    <E T="03">e.g.,</E>
                                     Exemption 4 covers trade secrets and commercial or financial information obtained from a contractor that is privileged or confidential).
                                </P>
                            </EXTRACT>
                            <FP SOURCE="FP-1">(End of provision)</FP>
                            <CITA>[85 FR 61520, Sept. 29, 2020, as amended at 87 FR 15818, Mar. 18, 2022; 88 FR 80466, Nov. 17, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.204-7020</SECTNO>
                            <SUBJECT>NIST SP 800-171 DoD Assessment Requirements.</SUBJECT>
                            <P>As prescribed in 204.7304(e), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">NIST SP 800-171 DOD Assessment Requirements (NOV 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                </P>
                                <P>
                                    <E T="03">Basic Assessment</E>
                                     means a contractor's self-assessment of the contractor's implementation of NIST SP 800-171 that—
                                </P>
                                <P>(1) Is based on the Contractor's review of their system security plan(s) associated with covered contractor information system(s);</P>
                                <P>(2) Is conducted in accordance with the NIST SP 800-171 DoD Assessment Methodology; and</P>
                                <P>(3) Results in a confidence level of “Low” in the resulting score, because it is a self-generated score.</P>
                                <P>
                                    <E T="03">Covered contractor information system</E>
                                     has the meaning given in the clause 252.204-7012, Safeguarding Covered Defense Information and Cyber Incident Reporting, of this contract.
                                </P>
                                <P>
                                    <E T="03">High Assessment</E>
                                     means an assessment that is conducted by Government personnel using NIST SP 800-171A, Assessing Security Requirements for Controlled Unclassified Information that—
                                    <PRTPAGE P="453"/>
                                </P>
                                <P>(1) Consists of—</P>
                                <P>(i) A review of a contractor's Basic Assessment;</P>
                                <P>(ii) A thorough document review;</P>
                                <P>(iii) Verification, examination, and demonstration of a Contractor's system security plan to validate that NIST SP 800-171 security requirements have been implemented as described in the contractor's system security plan; and</P>
                                <P>(iv) Discussions with the contractor to obtain additional information or clarification, as needed; and</P>
                                <P>(2) Results in a confidence level of “High” in the resulting score.</P>
                                <P>
                                    <E T="03">Medium Assessment</E>
                                     means an assessment conducted by the Government that—
                                </P>
                                <P>(1) Consists of—</P>
                                <P>(i) A review of a contractor's Basic Assessment;</P>
                                <P>(ii) A thorough document review; and</P>
                                <P>(iii) Discussions with the contractor to obtain additional information or clarification, as needed; and</P>
                                <P>(2) Results in a confidence level of “Medium” in the resulting score.</P>
                                <P>
                                    (b) 
                                    <E T="03">Applicability.</E>
                                     This clause applies to covered contractor information systems that are required to comply with the National Institute of Standards and Technology (NIST) Special Publication (SP) 800-171, in accordance with Defense Federal Acquisition Regulation System (DFARS) clause at 252.204-7012, Safeguarding Covered Defense Information and Cyber Incident Reporting, of this contract.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Requirements.</E>
                                     The Contractor shall provide access to its facilities, systems, and personnel necessary for the Government to conduct a Medium or High NIST SP 800-171 DoD Assessment, as described in NIST SP 800-171 DoD Assessment Methodology at 
                                    <E T="03">https://www.acq.osd.mil/asda/dpc/cp/cyber/docs/safeguarding/NIST-SP-800-171-Assessment-Methodology-Version-1.2.1-6.24.2020.pdf,</E>
                                     if necessary.
                                </P>
                                <P>
                                    (d) 
                                    <E T="03">Procedures.</E>
                                     Summary level scores for all assessments will be posted in the Supplier Performance Risk System (SPRS) (
                                    <E T="03">https://www.sprs.csd.disa.mil/</E>
                                    ) to provide DoD Components visibility into the summary level scores of strategic assessments.
                                </P>
                                <P>
                                    (1) 
                                    <E T="03">Basic Assessments.</E>
                                     A contractor may submit, via encrypted email, summary level scores of Basic Assessments conducted in accordance with the NIST SP 800-171 DoD Assessment Methodology to 
                                    <E T="03">webptsmh@navy.mil</E>
                                     for posting to SPRS.
                                </P>
                                <P>(i) The email shall include the following information:</P>
                                <P>(A) Version of NIST SP 800-171 against which the assessment was conducted.</P>
                                <P>
                                    (B) Organization conducting the assessment (
                                    <E T="03">e.g.,</E>
                                     Contractor self-assessment).
                                </P>
                                <P>(C) For each system security plan (security requirement 3.12.4) supporting the performance of a DoD contract—</P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) All industry Commercial and Government Entity (CAGE) code(s) associated with the information system(s) addressed by the system security plan; and
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) A brief description of the system security plan architecture, if more than one plan exists.
                                </P>
                                <P>(D) Date the assessment was completed.</P>
                                <P>
                                    (E) Summary level score (
                                    <E T="03">e.g.,</E>
                                     95 out of 110, NOT the individual value for each requirement).
                                </P>
                                <P>
                                    (F) Date that all requirements are expected to be implemented (
                                    <E T="03">i.e.,</E>
                                     a score of 110 is expected to be achieved) based on information gathered from associated plan(s) of action developed in accordance with NIST SP 800-171.
                                </P>
                                <P>(ii) If multiple system security plans are addressed in the email described at paragraph (b)(1)(i) of this section, the Contractor shall use the following format for the report:</P>
                                <GPOTABLE COLS="6" OPTS="L2" CDEF="s50,xl50,xl50,xl50,xl25,xl50">
                                    <BOXHD>
                                        <CHED H="1">System security plan</CHED>
                                        <CHED H="1">CAGE codes supported by this plan</CHED>
                                        <CHED H="1">Brief description of the plan architecture</CHED>
                                        <CHED H="1">
                                            Date of
                                            <LI>assessment</LI>
                                        </CHED>
                                        <CHED H="1">Total score</CHED>
                                        <CHED H="1">Date score of 110 will achieved</CHED>
                                    </BOXHD>
                                    <ROW RUL="s">
                                        <ENT I="22"> </ENT>
                                        <ENT/>
                                        <ENT/>
                                        <ENT/>
                                    </ROW>
                                    <ROW RUL="s">
                                        <ENT I="22"> </ENT>
                                        <ENT/>
                                        <ENT/>
                                        <ENT/>
                                    </ROW>
                                    <ROW>
                                        <ENT I="22"> </ENT>
                                        <ENT/>
                                        <ENT/>
                                        <ENT/>
                                        <ENT/>
                                        <ENT/>
                                    </ROW>
                                </GPOTABLE>
                                <P>
                                    (2) 
                                    <E T="03">Medium and High Assessments.</E>
                                     DoD will post the following Medium and/or High Assessment summary level scores to SPRS for each system security plan assessed:
                                </P>
                                <P>
                                    (i) The standard assessed (
                                    <E T="03">e.g.,</E>
                                     NIST SP 800-171 Rev 1).
                                </P>
                                <P>
                                    (ii) Organization conducting the assessment, 
                                    <E T="03">e.g.,</E>
                                     DCMA, or a specific organization (identified by Department of Defense Activity Address Code (DoDAAC)).
                                </P>
                                <P>(iii) All industry CAGE code(s) associated with the information system(s) addressed by the system security plan.</P>
                                <P>(iv) A brief description of the system security plan architecture, if more than one system security plan exists.</P>
                                <P>
                                    (v) Date and level of the assessment, 
                                    <E T="03">i.e.,</E>
                                     medium or high.
                                </P>
                                <P>
                                    (vi) Summary level score (
                                    <E T="03">e.g.,</E>
                                     105 out of 110, not the individual value assigned for each requirement).
                                    <PRTPAGE P="454"/>
                                </P>
                                <P>
                                    (vii) Date that all requirements are expected to be implemented (
                                    <E T="03">i.e.,</E>
                                     a score of 110 is expected to be achieved) based on information gathered from associated plan(s) of action developed in accordance with NIST SP 800-171.
                                </P>
                                <P>
                                    (e) 
                                    <E T="03">Rebuttals.</E>
                                     (1) DoD will provide Medium and High Assessment summary level scores to the Contractor and offer the opportunity for rebuttal and adjudication of assessment summary level scores prior to posting the summary level scores to SPRS (see SPRS User's Guide 
                                    <E T="03">https://www.sprs.csd.disa.mil/pdf/SPRS_Awardee.pdf</E>
                                    ).
                                </P>
                                <P>(2) Upon completion of each assessment, the contractor has 14 business days to provide additional information to demonstrate that they meet any security requirements not observed by the assessment team or to rebut the findings that may be of question.</P>
                                <P>
                                    (f) 
                                    <E T="03">Accessibility.</E>
                                     (1) Assessment summary level scores posted in SPRS are available to DoD personnel, and are protected, in accordance with the standards set forth in DoD Instruction 5000.79, Defense-wide Sharing and Use of Supplier and Product Performance Information (PI).
                                </P>
                                <P>
                                    (2) Authorized representatives of the Contractor for which the assessment was conducted may access SPRS to view their own summary level scores, in accordance with the SPRS Software User's Guide for Awardees/Contractors available at 
                                    <E T="03">https://www.sprs.csd.disa.mil/pdf/SPRS_Awardee.pdf.</E>
                                </P>
                                <P>
                                    (3) A High NIST SP 800-171 DoD Assessment may result in documentation in addition to that listed in this clause. DoD will retain and protect any such documentation as “Controlled Unclassified Information (CUI)” and intended for internal DoD use only. The information will be protected against unauthorized use and release, including through the exercise of applicable exemptions under the Freedom of Information Act (
                                    <E T="03">e.g.,</E>
                                     Exemption 4 covers trade secrets and commercial or financial information obtained from a contractor that is privileged or confidential).
                                </P>
                                <P>
                                    (g) 
                                    <E T="03">Subcontracts.</E>
                                     (1) The Contractor shall insert the substance of this clause, including this paragraph (g), in all subcontracts and other contractual instruments, including subcontracts for the acquisition of commercial products or commercial services (excluding commercially available off-the-shelf items).
                                </P>
                                <P>
                                    (2) The Contractor shall not award a subcontract or other contractual instrument, that is subject to the implementation of NIST SP 800-171 security requirements, in accordance with DFARS clause 252.204-7012 of this contract, unless the subcontractor has completed, within the last 3 years, at least a Basic NIST SP 800-171 DoD Assessment, as described in 
                                    <E T="03">https://www.acq.osd.mil/asda/dpc/cp/cyber/docs/safeguarding/NIST-SP-800-171-Assessment-Methodology-Version-1.2.1-6.24.2020.pdf,</E>
                                     for all covered contractor information systems relevant to its offer that are not part of an information technology service or system operated on behalf of the Government.
                                </P>
                                <P>
                                    (3) If a subcontractor does not have summary level scores of a current NIST SP 800-171 DoD Assessment (
                                    <E T="03">i.e.,</E>
                                     not more than 3 years old unless a lesser time is specified in the solicitation) posted in SPRS, the subcontractor may conduct and submit a Basic Assessment, in accordance with the NIST SP 800-171 DoD Assessment Methodology, to 
                                    <E T="03">webptsmh@navy.mil</E>
                                     for posting to SPRS along with the information required by paragraph (d) of this clause.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[85 FR 61520, Sept. 29, 2020, as amended at 87 FR 15818, Mar. 18, 2022; 88 FR 6589, Jan. 31, 2023; 88 FR 80466, Nov. 17, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.204-7021</SECTNO>
                            <SUBJECT>Contractor Compliance with the Cybersecurity Maturity Model Certification Level Requirement.</SUBJECT>
                            <P>As prescribed in 204.7503(a) and (b), insert the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Contractor Compliance With the Cybersecurity Maturity Model Certification Level Requirement (JAN 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Scope.</E>
                                     The Cybersecurity Maturity Model Certification (CMMC) CMMC is a framework that measures a contractor's cybersecurity maturity to include the implementation of cybersecurity practices and institutionalization of processes (see 
                                    <E T="03">https://www.acq.osd.mil/cmmc/index.html</E>
                                    ).
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Requirements.</E>
                                     The Contractor shall have a current (
                                    <E T="03">i.e.</E>
                                     not older than 3 years) CMMC certificate at the CMMC level required by this contract and maintain the CMMC certificate at the required level for the duration of the contract.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Subcontracts.</E>
                                     The Contractor shall—
                                </P>
                                <P>(1) Insert the substance of this clause, including this paragraph (c), in all subcontracts and other contractual instruments, including subcontracts for the acquisition of commercial products or commercial services, excluding commercially available off-the-shelf items; and</P>
                                <P>
                                    (2) Prior to awarding to a subcontractor, ensure that the subcontractor has a current (
                                    <E T="03">i.e.,</E>
                                     not older than 3 years) CMMC certificate at the CMMC level that is appropriate for the information that is being flowed down to the subcontractor.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[85 FR 61520, Sept. 29, 2020, as amended at 88 FR 6589, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="455"/>
                            <SECTNO>252.204-7022</SECTNO>
                            <SUBJECT>Expediting Contract Closeout.</SUBJECT>
                            <P>As prescribed in 204.804-70, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Expediting Contract Closeout (MAY 2021)</HD>
                                <P>(a) At the conclusion of all applicable closeout requirements of Federal Acquisition Regulation 4.804, the Government and Contractor shall mutually agree on the residual dollar amount remaining on the contract. Both the Government and Contractor agree to waive payment of any residual dollar amount of $1,000 or less to which either party may be entitled at the time of contract closeout.</P>
                                <P>(b) A residual dollar amount includes all money owed to either party at the end of the contract and as a result of the contract, excluding amounts connected in any way with taxation or a violation of law or regulation.</P>
                                <P>(c) For purposes of determining residual dollar amounts, offsets (e.g., across multiple contracts or orders) may be considered only to the extent permitted by law.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[86 FR 27277, May 20, 2021]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.204-7023</SECTNO>
                            <SUBJECT>Reporting Requirements for Contracted Services.</SUBJECT>
                            <P>
                                <E T="03">Basic.</E>
                                 As prescribed in 204.1705(a)(i) and (ii), use the following clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Reporting Requirements for Contracted Services—Basic (Jul 2021)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">First-tier subcontract</E>
                                     means a subcontract awarded directly by the contractor for the purpose of acquiring services for performance of a prime contract. It does not include the contractor's supplier agreements with vendors, such as long-term arrangements for materials or supplies or services that benefit multiple contracts and/or the costs of which are normally applied to a contractor's general and administrative expenses or indirect costs.
                                </P>
                                <P>
                                    (b) The Contractor shall report annually, by October 31, at 
                                    <E T="03">https://www.sam.gov,</E>
                                     on the services performed under this contract or order, including any first-tier subcontracts, during the preceding Government fiscal year (October 1-September 30).
                                </P>
                                <P>(c) The Contractor shall report the following information for the contract or order:</P>
                                <P>(1) The total dollar amount invoiced for services performed during the preceding Government fiscal year under the contract or order.</P>
                                <P>(2) The number of Contractor direct labor hours, to include first-tier subcontractor direct labor hours, as applicable, expended on the services performed under the contract or order during the previous Government fiscal year.</P>
                                <P>(d) The Government will review the Contractor's reported information for reasonableness and consistency with available contract information. In the event the Government believes that revisions to the Contractor's reported information are warranted, the Government will notify the Contractor. Upon notification, the Contractor shall revise the reported information or provide the Government with a supporting rationale for the information.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate I.</E>
                                 As prescribed in 204.1705 (a)(i) and (iii), use the following clause, which substitutes “contract or agreement for each order” in lieu of “contract or order” in paragraph (b) and “order” in lieu of “contract or order” in paragraphs (c) and (c)(1) and (2), and identifies the dollar threshold and service acquisition portfolio groups for which orders under the contract or agreement require service contract reporting.
                            </P>
                            <HD SOURCE="HD1">Reporting Requirements for Contracted Services—Alternate I (Jul 2021)</HD>
                            <EXTRACT>
                                <P>
                                    (a) 
                                    <E T="03">Definition.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">First-tier subcontract</E>
                                     means a subcontract awarded directly by the contractor for the purpose of acquiring services for performance of a prime contract. It does not include the contractor's supplier agreements with vendors, such as long-term arrangements for materials or supplies or services that benefit multiple contracts and/or the costs of which are normally applied to a contractor's general and administrative expenses or indirect costs.
                                </P>
                                <P>
                                    (b) The contractor shall report annually, by October 31, at 
                                    <E T="03">https://www.sam.gov,</E>
                                     on services performed during the preceding Government fiscal year (October 1-September 30) under this contract or agreement for each order, including any first-tier subcontract, which exceeds $3 million for services in the following service acquisition portfolio groups:
                                </P>
                                <P>(1) Logistics management services.</P>
                                <P>(2) Equipment-related services.</P>
                                <P>(3) Knowledge-based services.</P>
                                <P>(4) Electronics and communications services.</P>
                                <P>(c) The Contractor shall report the following information for the order:</P>
                                <P>
                                    (1) The total dollar amount invoiced for services performed during the preceding Government fiscal year under the order.
                                    <PRTPAGE P="456"/>
                                </P>
                                <P>(2) The number of Contractor direct labor hours, to include first-tier subcontractor direct labor hours, as applicable, expended on the services performed under the order during the previous Government fiscal year.</P>
                                <P>(d) The Government will review the Contractor's reported information for reasonableness and consistency with available contract information. In the event the Government believes that revisions to the Contractor's reported information are warranted, the Government will notify the Contractor. Upon notification, the Contractor shall revise the reported information or provide the Government with a supporting rationale for the information.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[86 FR 36236, July 9, 2021]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.204-7024</SECTNO>
                            <SUBJECT>Notice on the Use of the Supplier Performance Risk System.</SUBJECT>
                            <P>As prescribed in 204.7604, use the following provision:</P>
                            <HD SOURCE="HD1">Notice on the Use of the Supplier Performance Risk System (MAR 2023)</HD>
                            <EXTRACT>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this provision—
                                </P>
                                <P>
                                    <E T="03">Item risk</E>
                                     means the probability that a product, based on intended use, will introduce performance risk resulting in safety issues, mission degradation, or monetary loss.
                                </P>
                                <P>
                                    <E T="03">Price risk</E>
                                     means a measure of whether a proposed price for a product or service is consistent with historical prices paid for that item or service.
                                </P>
                                <P>
                                    <E T="03">Supplier risk</E>
                                     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).
                                </P>
                                <P>
                                    (b) The Supplier Performance Risk System (SPRS), available at 
                                    <E T="03">https://piee.eb.mil/,</E>
                                     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 reporting systems in order to develop risk assessments.
                                </P>
                                <P>(c) The Contracting Officer will consider SPRS risk assessments during the evaluation of quotations or offers received in response to this solicitation as follows:</P>
                                <P>(1) Item risk will be considered to determine whether the procurement represents a high performance risk to the Government.</P>
                                <P>(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.</P>
                                <P>(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.</P>
                                <P>
                                    (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 
                                    <E T="03">https://www.sprs.csd.disa.mil/reference.htm.</E>
                                     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 
                                    <E T="03">https://www.sprs.csd.disa.mil/pdf/SPRS_DataEvaluationCriteria.pdf.</E>
                                </P>
                                <P>(e) The Contracting Officer may consider any other available and relevant information when evaluating a quotation or an offer.</P>
                            </EXTRACT>
                            <P>(End of provision)</P>
                            <CITA>[88 FR 17339, Mar. 22, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.205-7000</SECTNO>
                            <SUBJECT>Provision of information to cooperative agreement holders.</SUBJECT>
                            <P>As prescribed in 205.470, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Provision of Information to Cooperative Agreement Holders (JUN 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition. Cooperative agreement holder</E>
                                     means a State or local government; a private, nonprofit organization; a tribal organization (as defined in section 4(c) of the Indian Self-Determination and Education Assistance Act (25 U.S.C. 5304(l)); or an economic enterprise (as defined in section 3(e) of the Indian Financing Act of 1974 (25 U.S.C. 1452(e))) whether such economic enterprise is organized for profit or nonprofit purposes; which has an agreement with the Under Secretary of Defense for Acquisition and Sustainment to furnish procurement technical assistance to business entities.
                                </P>
                                <P>(b) The Contractor shall provide cooperative agreement holders, upon their request, with a list of those appropriate employees or offices responsible for entering into subcontracts under defense contracts. The list shall include the business address, telephone number, and area of responsibility of each employee or office.</P>
                                <P>(c) The Contractor need not provide the listing to a particular cooperative agreement holder more frequently than once a year.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 69 FR 63328, Nov. 1, 2004; 88 FR 37799, June 9, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="457"/>
                            <SECTNO>252.206-7000</SECTNO>
                            <SUBJECT>Domestic Source Restriction.</SUBJECT>
                            <P>As prescribed at 206.302-3-70, use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Domestic Source Restriction (AUG 2023)</HD>
                                <P>This solicitation is restricted to domestic sources under the authority of 10 U.S.C. 3204(a)(3). Foreign sources, except Canadian sources, are not eligible for award.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 87 FR 76996, Dec. 16, 2022; 88 FR 55940, Aug. 17, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.208-7000</SECTNO>
                            <SUBJECT>Intent to furnish precious metals as Government-furnished material.</SUBJECT>
                            <P>As prescribed in 208.7305(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Intent To Furnish Precious Metals as Government-Furnished Material (DEC 1991)</HD>
                                <P>(a) The Government intends to furnish precious metals required in the manufacture of items to be delivered under the contract if the Contracting Officer determines it to be in the Government's best interest. The use of Government-furnished silver is mandatory when the quantity required is one hundred troy ounces or more. The precious metal(s) will be furnished pursuant to the Government Furnished Property clause of the contract.</P>
                                <P>(b) The Offeror shall cite the type (silver, gold, platinum, palladium, iridium, rhodium, and ruthenium) and quantity in whole troy ounces of precious metals required in the performance of this contract (including precious metals required for any first article or production sample), and shall specify the national stock number (NSN) and nomenclature, if known, of the deliverable item requiring precious metals.</P>
                                <GPOTABLE COLS="3" OPTS="L1" CDEF="s10,r10,r10">
                                    <BOXHD>
                                        <CHED H="1">Precious metal*</CHED>
                                        <CHED H="1">Quantity</CHED>
                                        <CHED H="1">Deliverable item (NSN and nomenclature)!!rs</CHED>
                                    </BOXHD>
                                    <ROW EXPSTB="02">
                                        <ENT I="01"> </ENT>
                                    </ROW>
                                    <TNOTE>*If platinum or palladium, specify whether sponge or granules are required.</TNOTE>
                                </GPOTABLE>
                                <P>(c) Offerors shall submit two prices for each deliverable item which contains precious metals—one based on the Government furnishing precious metals, and one based on the Contractor furnishing precious metals. Award will be made on the basis which is in the best interest of the Government.</P>
                                <P>(d) The Contractor agrees to insert this clause, including this paragraph (d), in solicitations for subcontracts and purchase orders issued in performance of this contract, unless the Contractor knows that the item being purchased contains no precious metals.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.209-7000—252.209-7001</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.209-7002</SECTNO>
                            <SUBJECT>Disclosure of Ownership or Control by a Foreign Government.</SUBJECT>
                            <P>As prescribed in 209.104-70, use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Disclosure of Ownership or Control by a Foreign Government (DEC 2022)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this provision—
                                </P>
                                <P>
                                    (1) 
                                    <E T="03">Effectively owned or controlled</E>
                                     means that a foreign government or any entity controlled by a foreign government has the power, either directly or indirectly, whether exercised or exercisable, to control the election, appointment, or tenure of the Offeror's officers or a majority of the Offeror's board of directors by any means, e.g., ownership, contract, or operation of law (or equivalent power for unincorporated organizations).
                                </P>
                                <P>
                                    (2) 
                                    <E T="03">Entity controlled by a foreign government</E>
                                    —
                                </P>
                                <P>(i) Means—</P>
                                <P>(A) Any domestic or foreign organization or corporation that is effectively owned or controlled by a foreign government; or</P>
                                <P>(B) Any individual acting on behalf of a foreign government.</P>
                                <P>(ii) Does not include an organization or corporation that is owned, but is not controlled, either directly or indirectly, by a foreign government if the ownership of that organization or corporation by that foreign government was effective before October 23, 1992.</P>
                                <P>
                                    (3) 
                                    <E T="03">Foreign government</E>
                                     includes the state and the government of any country (other than the United States and its outlying areas) as well as any political subdivision, agency, or instrumentality thereof.
                                </P>
                                <P>
                                    (4) 
                                    <E T="03">Proscribed information</E>
                                     means—
                                </P>
                                <P>(i) Top Secret information;</P>
                                <P>(ii) Communications security (COMSEC) material, excluding controlled cryptographic items when unkeyed or utilized with unclassified keys;</P>
                                <P>(iii) Restricted Data as defined in the U.S. Atomic Energy Act of 1954, as amended;</P>
                                <P>(iv) Special Access Program (SAP) information; or</P>
                                <P>(v) Sensitive Compartmented Information (SCI).</P>
                                <P>
                                    (b) 
                                    <E T="03">Prohibition on award.</E>
                                     No contract under a national security program may be awarded to an entity controlled by a foreign government if that entity requires access to proscribed information to perform the contract, unless the Secretary of Defense or a designee has waived application of 10 U.S.C. 4874.
                                    <PRTPAGE P="458"/>
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Disclosure.</E>
                                     The Offeror shall disclose any interest a foreign government has in the Offeror when that interest constitutes control by a foreign government as defined in this provision. If the Offeror is a subsidiary, it shall also disclose any reportable interest a foreign government has in any entity that owns or controls the subsidiary, including reportable interest concerning the Offeror's immediate parent, intermediate parents, and the ultimate parent. Use separate paper as needed, and provide the information in the following format: Offeror's Point of Contact for Questions about Disclosure (Name and Phone Number with Country Code, City Code and Area Code, as applicable)
                                </P>
                                <GPOTABLE COLS="2" OPTS="L0,7/8,g1,t1" CDEF="s25,r25">
                                    <ROW>
                                        <ENT I="01">Name and Address of Offeror</ENT>
                                    </ROW>
                                    <ROW>
                                        <ENT I="01">Name and Address of Entity Controlled by a Foreign Government</ENT>
                                        <ENT>Description of Interest, Ownership Percentage, and Identification of Foreign Government</ENT>
                                    </ROW>
                                </GPOTABLE>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[58 FR 28471, May 13, 1993, as amended at 59 FR 51133, Oct. 7, 1994; 70 FR 35546, June 21, 2005; 75 FR 35685, June 23, 2010; 79 FR 73490, Dec. 11, 2014; 87 FR 76996, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.209-7003</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.209-7004</SECTNO>
                            <SUBJECT>Subcontracting with Firms that are Owned or Controlled by the Government of a Country that is a State Sponsor of Terrorism.</SUBJECT>
                            <P>As prescribed in 209.409, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Subcontracting With Firms That Are Owned or Controlled by the Government of a Country That Is a State Sponsor of Terrorism (MAY 2019)</HD>
                                <P>(a) Unless the Government determines that there is a compelling reason to do so, the Contractor shall not enter into any subcontract in excess of the threshold specified in Federal Acquisition Regulation 9.405-2(b) on the date of subcontract award with a firm, or a subsidiary of a firm, that is identified in the Exclusions section of the System for Award Management System (SAM Exclusions) as being ineligible for the award of Defense contracts or subcontracts because it is owned or controlled by the government of a country that is a state sponsor of terrorism.</P>
                                <P>(b) A corporate officer or a designee of the Contractor shall notify the Contracting Officer, in writing, before entering into a subcontract with a party that is identified, in SAM Exclusions, as being ineligible for the award of Defense contracts or subcontracts because it is owned or controlled by the government of a country that is a state sponsor of terrorism. The notice must include the name of the proposed subcontractor and the compelling reason(s) for doing business with the subcontractor notwithstanding its inclusion in SAM Exclusions.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[79 FR 73490, Dec. 11, 2014, as amended at 80 FR 36905, June 26, 2015; 84 FR 25187, May 31, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.209-7005</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.209-7006</SECTNO>
                            <SUBJECT>Limitations on Contractors Acting as Lead System Integrators.</SUBJECT>
                            <P>As prescribed in 209.570-4(a), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Limitations on Contractors Acting As Lead System Integrators (DEC 2022)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions. Lead system integrator, lead system integrator with system responsibility,</E>
                                     and 
                                    <E T="03">lead system integrator without system responsibility,</E>
                                     as used in this provision, have the meanings given in the clause of this solicitation entitled “Prohibited Financial Interests for Lead System Integrators” (DFARS 252.209-7007).
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">General.</E>
                                     Unless an exception is granted, no contractor performing lead system integrator functions in the acquisition of a major system by the Department of Defense may have any direct financial interest in the development or construction of any individual system or element of any system of systems.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Representations.</E>
                                     (1) The offeror represents that it does
                                </P>
                                <P>[ ] does not [ ] propose to perform this contract as a lead system integrator with system responsibility.</P>
                                <P>(2) The offeror represents that it does [ ] does not [ ] propose to perform this contract as a lead system integrator without system responsibility.</P>
                                <P>(3) If the offeror answered in the affirmative in paragraph (c)(1) or (2) of this provision, the offeror represents that it does [ ] does not [ ] have any direct financial interest as described in paragraph (b) of this provision with respect to the system(s), subsystem(s), system of systems, or services described in this solicitation.</P>
                                <P>(d) If the offeror answered in the affirmative in paragraph (c)(3) of this provision, the offeror should contact the Contracting Officer for guidance on the possibility of submitting a mitigation plan and/or requesting an exception.</P>
                                <P>
                                    (e) If the offeror does have a direct financial interest, the offeror may be prohibited 
                                    <PRTPAGE P="459"/>
                                    from receiving an award under this solicitation, unless the offeror submits to the Contracting Officer appropriate evidence that the offeror was selected by a subcontractor to serve as a lower-tier subcontractor through a process over which the offeror exercised no control.
                                </P>
                                <P>(f) This provision implements the requirements of10 U.S.C. 4292.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[73 FR 1825, Jan. 10, 2007, as amended at 87 FR 76996, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.209-7007</SECTNO>
                            <SUBJECT>Prohibited Financial Interests for Lead System Integrators.</SUBJECT>
                            <P>As prescribed in 209.570-4(b), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Prohibited Financial Interests for Lead System Integrators (DEC 2022)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    (1) 
                                    <E T="03">Lead system integrator</E>
                                     includes 
                                    <E T="03">lead system integrator with system responsibility</E>
                                     and 
                                    <E T="03">lead system integrator without system responsibility.</E>
                                </P>
                                <P>
                                    (2) 
                                    <E T="03">Lead system integrator with system responsibility</E>
                                     means a prime contractor for the development or production of a major system, if the prime contractor is not expected at the time of award to perform a substantial portion of the work on the system and the major subsystems.
                                </P>
                                <P>
                                    (3) 
                                    <E T="03">Lead system integrator without system responsibility</E>
                                     means a prime contractor under a contract for the procurement of services, the primary purpose of which is to perform acquisition functions closely associated with inherently governmental functions (see section 7.503(d) of the Federal Acquisition Regulation) with respect to the development or production of a major system.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Limitations.</E>
                                     The Contracting Officer has determined that the Contractor meets the definition of lead system integrator with [ ] without [ ] system responsibility. Unless an exception is granted, the Contractor shall not have any direct financial interest in the development or construction of any individual system or element of any system of systems while performing lead system integrator functions in the acquisition of a major system by the Department of Defense under this contract.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Agreement.</E>
                                     The Contractor agrees that during performance of this contract it will not acquire any direct financial interest as described in paragraph (b) of this clause, or, if it does acquire or plan to acquire such interest, it will immediately notify the Contracting Officer. The Contractor further agrees to provide to the Contracting Officer all relevant information regarding the change in financial interests so that the Contracting Officer can determine whether an exception applies or whether the Contractor will be allowed to continue performance on this contract. If a direct financial interest cannot be avoided, eliminated, or mitigated to the Contracting Officer's satisfaction, the Contracting Officer may terminate this contract for default for the Contractor's material failure to comply with the terms and conditions of award or may take other remedial measures as appropriate in the Contracting Officer's sole discretion.
                                </P>
                                <P>(d) Notwithstanding any other clause of this contract, if the Contracting Officer determines that the Contractor misrepresented its financial interests at the time of award or has violated the agreement in paragraph (c) of this clause, the Government may terminate this contract for default for the Contractor's material failure to comply with the terms and conditions of award or may take other remedial measures as appropriate in the Contracting Officer's sole discretion.</P>
                                <P>(e) This clause implements the requirements of10 U.S.C. 4292.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[73 FR 1825, Jan. 10, 2007, as amended at 74 FR 34269, July 15, 2009; 87 FR 76996, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.209-7008</SECTNO>
                            <SUBJECT>Notice of Prohibition Relating to Organizational Conflict of Interest—Major Defense Acquisition Program.</SUBJECT>
                            <P>As prescribed in 209.571-8(a), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Notice of Prohibition Relating to Organizational Conflict of Interest—Major Defense Acquisition Program (DEC 2010)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     “Major subcontractor” is defined in the clause at 252.209-7009, Organizational Conflict of Interest—Major Defense Acquisition Program.
                                </P>
                                <P>(b) This solicitation is for the performance of systems engineering and technical assistance for a major defense acquisition program or a pre-major defense acquisition program.</P>
                                <P>
                                    (c) 
                                    <E T="03">Prohibition.</E>
                                     As required by paragraph (b)(3) of section 207 of the Weapons System Acquisition Reform Act of 2009 (Pub. L. 111-23), if awarded the contract, the contractor or any affiliate of the contractor is prohibited from participating as a prime contractor or a major subcontractor in the development or production of a weapon system under the major defense acquisition program or pre-major defense acquisition program, unless the offeror submits, and the Government approves, an Organizational Conflict of Interest Mitigation Plan.
                                </P>
                                <P>
                                    (d) 
                                    <E T="03">Request for an exception.</E>
                                     If the offeror requests an exception to the prohibition of paragraph (c) of this provision, then the offeror shall submit an Organizational Conflict 
                                    <PRTPAGE P="460"/>
                                    of Interest Mitigation Plan with its offer for evaluation.
                                </P>
                                <P>
                                    (e) 
                                    <E T="03">Incorporation of Organizational Conflict of Interest Mitigation Plan in contract.</E>
                                     If the apparently successful offeror submitted an acceptable Organizational Conflict of Interest Mitigation Plan, and the head of the contracting activity determines that DoD needs the domain experience and expertise of the highly qualified, apparently successful offeror in accordance with FAR 209.571-7(c), then the Contracting Officer will incorporate the Organizational Conflict of Interest Mitigation Plan into the resultant contract, and paragraph (d) of the clause at 252.209-7009 will become applicable.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[75 FR 81914, Dec. 29, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.209-7009</SECTNO>
                            <SUBJECT>Organizational Conflict of Interest—Major Defense Acquisition Program.</SUBJECT>
                            <P>As prescribed in 209.571-8(b), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Organizational Conflict of Interest—Major Defense Acquisition Program (MAY 2019)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Major subcontractor</E>
                                     means a subcontractor that is awarded a subcontract that equals or exceeds—
                                </P>
                                <P>(1) Both the certified cost or pricing data threshold and 10 percent of the value of the contract under which the subcontract is awarded; or</P>
                                <P>(2) The threshold specified in the definition of “major subcontractor” at Defense Federal Acquisition Regulation Supplement 209.571-1 on the date of subcontract award.</P>
                                <P>(b) This contract is for the performance of systems engineering and technical assistance for a major defense acquisition program or a pre-major defense acquisition program.</P>
                                <P>
                                    (c) 
                                    <E T="03">Prohibition.</E>
                                     Except as provided in paragraph (d) of this clause, as required by paragraph (b)(3) of section 207 of the Weapons System Acquisition Reform Act of 2009 (Pub. L. 111-23), the Contractor or any affiliate of the Contractor is prohibited from participating as a prime contractor or major subcontractor in the development or production of a weapon system under the major defense acquisition program or pre-major defense acquisition program.
                                </P>
                                <P>
                                    (d) 
                                    <E T="03">Organizational Conflict of Interest Mitigation Plan.</E>
                                     If the Contractor submitted an acceptable Organizational Conflict of Interest Mitigation Plan that has been incorporated into this contract, then the prohibition in paragraph (c) of this clause does not apply. The Contractor shall comply with the Organizational Conflict of Interest Mitigation Plan. Compliance with the Organizational Conflict of Interest Mitigation Plan is a material requirement of the contract. Failure to comply may result in the Contractor or any affiliate of the Contractor being prohibited from participating as a contractor or major subcontractor in the development or production of a weapon system under the program, in addition to any other remedies available to the Government for noncompliance with a material requirement of a contract.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[75 FR 81914, Dec. 29, 2010, as amended at 77 FR 76940, Dec. 31, 2012; 80 FR 36905, June 26, 2015; 84 FR 25187, May 31, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.209-7010</SECTNO>
                            <SUBJECT>Critical Safety Items.</SUBJECT>
                            <P>As prescribed in 209.270-5, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Critical Safety Items (AUG 2011)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                </P>
                                <P>
                                    <E T="03">Aviation critical safety item</E>
                                     means a part, an assembly, installation equipment, launch equipment, recovery equipment, or support equipment for an aircraft or aviation weapon system if the part, assembly, or equipment contains a characteristic any failure, malfunction, or absence of which could cause—
                                </P>
                                <P>(i) A catastrophic or critical failure resulting in the loss of, or serious damage to, the aircraft or weapon system;</P>
                                <P>(ii) An unacceptable risk of personal injury or loss of life; or</P>
                                <P>(iii) An uncommanded engine shutdown that jeopardizes safety.</P>
                                <P>
                                    <E T="03">Design control activity.</E>
                                     (i) With respect to an aviation critical safety item, means the systems command of a military department that is specifically responsible for ensuring the airworthiness of an aviation system or equipment, in which an aviation critical safety item is to be used; and
                                </P>
                                <P>(ii) With respect to a ship critical safety item, means the systems command of a military department that is specifically responsible for ensuring the seaworthiness of a ship or ship equipment, in which a ship critical safety item is to be used.</P>
                                <P>
                                    <E T="03">Ship critical safety item</E>
                                     means any ship part, assembly, or support equipment containing a characteristic, the failure, malfunction, or absence of which could cause—
                                </P>
                                <P>(i) A catastrophic or critical failure resulting in loss of, or serious damage to, the ship; or</P>
                                <P>(ii) An unacceptable risk of personal injury or loss of life.</P>
                                <P>
                                    (b) 
                                    <E T="03">Identification of critical safety items.</E>
                                     One or more of the items being procured under this contract is an aviation or ship critical safety item. The following items have been designated aviation critical safety items or 
                                    <PRTPAGE P="461"/>
                                    ship critical safety items by the designated design control activity:
                                </P>
                                <FP SOURCE="FP-DASH"/>
                                <FP SOURCE="FP-DASH"/>
                                <FP SOURCE="FP-DASH"/>
                                <FP SOURCE="FP-DASH"/>
                                <FP>
                                    (
                                    <E T="03">Insert additional lines as necessary</E>
                                    )
                                </FP>
                                <P>
                                    (c) 
                                    <E T="03">Heightened quality assurance surveillance.</E>
                                     Items designated in paragraph (b) of this clause are subject to heightened, risk-based surveillance by the designated quality assurance representative.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[76 FR 52139, Aug. 19, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.209-7011</SECTNO>
                            <SUBJECT>Representation for Restriction on the Use of Certain Institutions of Higher Education.</SUBJECT>
                            <P>As prescribed in 209.170-4, use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Representation for Restriction on the Use of Certain Institutions of Higher Education (Oct 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this provision—
                                </P>
                                <P>
                                    <E T="03">Confucius Institute</E>
                                     means a cultural institute directly or indirectly funded by the government of the People's Republic of China.
                                </P>
                                <P>
                                    <E T="03">Institution of higher educati</E>
                                    on has the meaning given in 20 U.S.C. 1002.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Restriction.</E>
                                     As required by section 1062 of the National Defense Authorization Act for Fiscal Year 2021 (Pub. L. 116-283), DoD may not award a contract with any institution of higher education that hosts a Confucius Institute. Section 1062 prohibits DoD from providing funding to any U.S. institution of higher education hosting a Confucius Institute unless that institution receives a waiver from the Department of Defense Office of the Under Secretary of Defense for Research and Engineering (OUSD(R&amp;E)). See the OUSD(R&amp;E) Confucius Institute Waiver Program Guidance to U.S. Institutions of Higher Education at 
                                    <E T="03">https://rt.cto.mil/wp-content/uploads/Confucius-Institute-Waiver-Program-Guidance-28Mar2023.pdf.</E>
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Representation.</E>
                                     By submission of an offer, the Offeror represents that—
                                </P>
                                <P>(1) It is not an institution of higher education that hosts a Confucius Institute; or</P>
                                <P>(2) The Offeror has obtained a waiver approved by OUSD(R&amp;E).</P>
                            </EXTRACT>
                            <FP>(End of provision)</FP>
                            <CITA>[88 FR 67609, Sept. 29, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.211-7000—252.211-7001</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.211-7002</SECTNO>
                            <SUBJECT>Availability for examination of specifications, standards, plans, drawings, data item descriptions, and other pertinent documents.</SUBJECT>
                            <P>As prescribed in 211.204(c), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Availability for Examination of Specifications, Standards, Plans, Drawings, Data Item Descriptions, and Other Pertinent Documents (DEC 1991)</HD>
                                <P>The specifications, standards, plans, drawings, data item descriptions, and other pertinent documents cited in this solicitation are not available for distribution but may be examined at the following location:</P>
                                <FP SOURCE="FP-DASH"> </FP>
                                <FP>(Insert complete address)</FP>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[56 FR 36479, July 31, 1991. Redesignated and amended at 60 FR 61600, Nov. 30, 1995]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.211-7003</SECTNO>
                            <SUBJECT>Item Unique Identification and Valuation.</SUBJECT>
                            <P>As prescribed in 211.274-5(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Item Unique Identification and Valuation (JAN 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Automatic identification device</E>
                                     means a device, such as a reader or interrogator, used to retrieve data encoded on machine-readable media.
                                </P>
                                <P>
                                    <E T="03">Concatenated unique item identifier</E>
                                     means—
                                </P>
                                <P>(1) For items that are serialized within the enterprise identifier, the linking together of the unique identifier data elements in order of the issuing agency code, enterprise identifier, and unique serial number within the enterprise identifier; or</P>
                                <P>(2) For items that are serialized within the original part, lot, or batch number, the linking together of the unique identifier data elements in order of the issuing agency code; enterprise identifier; original part, lot, or batch number; and serial number within the original part, lot, or batch number.</P>
                                <P>
                                    <E T="03">Data matrix</E>
                                     means a two-dimensional matrix symbology, which is made up of square or, in some cases, round modules arranged within a perimeter finder pattern and uses the Error Checking and Correction 200 (ECC200) specification found within International Standards Organization (ISO)/International Electrotechnical Commission (IEC) 16022.
                                </P>
                                <P>
                                    <E T="03">Data qualifier</E>
                                     means a specified character (or string of characters) that immediately 
                                    <PRTPAGE P="462"/>
                                    precedes a data field that defines the general category or intended use of the data that follows.
                                </P>
                                <P>
                                    <E T="03">DoD recognized unique identification equivalent</E>
                                     means a unique identification method that is in commercial use and has been recognized by DoD. All DoD recognized unique identification equivalents are listed at 
                                    <E T="03">https://www.acq.osd.mil/asda/dpc/ce/ds/unique-id.html.</E>
                                </P>
                                <P>
                                    <E T="03">DoD item unique identification</E>
                                     means a system of marking items delivered to DoD with unique item identifiers that have machine-readable data elements to distinguish an item from all other like and unlike items. For items that are serialized within the enterprise identifier, the unique item identifier shall include the data elements of the enterprise identifier and a unique serial number. For items that are serialized within the part, lot, or batch number within the enterprise identifier, the unique item identifier shall include the data elements of the enterprise identifier; the original part, lot, or batch number; and the serial number.
                                </P>
                                <P>
                                    <E T="03">Enterprise</E>
                                     means the entity (
                                    <E T="03">e.g.</E>
                                    , a manufacturer or vendor) responsible for assigning unique item identifiers to items.
                                </P>
                                <P>
                                    <E T="03">Enterprise identifier</E>
                                     means a code that is uniquely assigned to an enterprise by an issuing agency.
                                </P>
                                <P>
                                    <E T="03">Government's unit acquisition cost</E>
                                     means—
                                </P>
                                <P>(1) For fixed-price type line, subline, or exhibit line items, the unit price identified in the contract at the time of delivery;</P>
                                <P>(2) For cost-type or undefinitized line, subline, or exhibit line items, the Contractor's estimated fully burdened unit cost to the Government at the time of delivery; and</P>
                                <P>(3) For items produced under a time-and-materials contract, the Contractor's estimated fully burdened unit cost to the Government at the time of delivery.</P>
                                <P>
                                    <E T="03">Issuing agency</E>
                                     means an organization responsible for assigning a globally unique identifier to an enterprise, as indicated in the Register of Issuing Agency Codes for ISO/IEC 15459, located at 
                                    <E T="03">http://www.aimglobal.org/?Reg_Authority15459.</E>
                                </P>
                                <P>
                                    <E T="03">Issuing agency code</E>
                                     means a code that designates the registration (or controlling) authority for the enterprise identifier.
                                </P>
                                <P>
                                    <E T="03">Item</E>
                                     means a single hardware article or a single unit formed by a grouping of subassemblies, components, or constituent parts.
                                </P>
                                <P>
                                    <E T="03">Lot or batch number</E>
                                     means an identifying number assigned by the enterprise to a designated group of items, usually referred to as either a lot or a batch, all of which were manufactured under identical conditions.
                                </P>
                                <P>
                                    <E T="03">Machine-readable</E>
                                     means an automatic identification technology media, such as bar codes, contact memory buttons, radio frequency identification, or optical memory cards.
                                </P>
                                <P>
                                    <E T="03">Original part number</E>
                                     means a combination of numbers or letters assigned by the enterprise at item creation to a class of items with the same form, fit, function, and interface.
                                </P>
                                <P>
                                    <E T="03">Parent item</E>
                                     means the item assembly, intermediate component, or subassembly that has an embedded item with a unique item identifier or DoD recognized unique identification equivalent.
                                </P>
                                <P>
                                    <E T="03">Serial number within the enterprise identifier</E>
                                     means a combination of numbers, letters, or symbols assigned by the enterprise to an item that provides for the differentiation of that item from any other like and unlike item and is never used again within the enterprise.
                                </P>
                                <P>
                                    <E T="03">Serial number within the part, lot, or batch number</E>
                                     means a combination of numbers or letters assigned by the enterprise to an item that provides for the differentiation of that item from any other like item within a part, lot, or batch number assignment.
                                </P>
                                <P>
                                    <E T="03">Serialization within the enterprise identifier</E>
                                     means each item produced is assigned a serial number that is unique among all the tangible items produced by the enterprise and is never used again. The enterprise is responsible for ensuring unique serialization within the enterprise identifier.
                                </P>
                                <P>
                                    <E T="03">Serialization within the part, lot, or batch number</E>
                                     means each item of a particular part, lot, or batch number is assigned a unique serial number within that part, lot, or batch number assignment. The enterprise is responsible for ensuring unique serialization within the part, lot, or batch number within the enterprise identifier.
                                </P>
                                <P>
                                    <E T="03">Type designation</E>
                                     means a combination of letters and numerals assigned by the Government to a major end item, assembly or subassembly, as appropriate, to provide a convenient means of differentiating between items having the same basic name and to indicate modifications and changes thereto.
                                </P>
                                <P>
                                    <E T="03">Unique item identifier</E>
                                     means a set of data elements marked on items that is globally unique and unambiguous. The term includes a concatenated unique item identifier or a DoD recognized unique identification equivalent.
                                </P>
                                <P>
                                    <E T="03">Unique item identifier type</E>
                                     means a designator to indicate which method of uniquely identifying a part has been used. The current list of accepted unique item identifier types is maintained at 
                                    <E T="03">https://www.acq.osd.mil/asda/dpc/ce/ds/unique-id.html .</E>
                                </P>
                                <P>(b) The Contractor shall deliver all items under a contract line, subline, or exhibit line item.</P>
                                <P>
                                    (c) 
                                    <E T="03">Unique item identifier.</E>
                                     (1) The Contractor shall provide a unique item identifier for the following:
                                </P>
                                <P>
                                    (i) Delivered items for which the Government's unit acquisition cost is $5,000 or more, except for the following line items:
                                    <PRTPAGE P="463"/>
                                </P>
                                <GPOTABLE COLS="2" OPTS="L1" CDEF="xl50,xl50">
                                    <BOXHD>
                                        <CHED H="1">Contract line, subline, or exhibit line item No.</CHED>
                                        <CHED H="1">Item description</CHED>
                                    </BOXHD>
                                    <ROW>
                                        <ENT I="01"/>
                                        <ENT/>
                                    </ROW>
                                </GPOTABLE>
                                <P>(ii) Items for which the Government's unit acquisition cost is less than $5,000 that are identified in the Schedule or the following table:</P>
                                <GPOTABLE COLS="2" OPTS="L1" CDEF="xl50,xl50">
                                    <BOXHD>
                                        <CHED H="1">Contract line, subline, or exhibit line item No.</CHED>
                                        <CHED H="1">Item description</CHED>
                                    </BOXHD>
                                    <ROW>
                                        <ENT I="01"/>
                                        <ENT/>
                                    </ROW>
                                </GPOTABLE>
                                <FP>
                                    (
                                    <E T="03">If items are identified in the Schedule, insert “See Schedule” in this table.</E>
                                    )
                                </FP>
                                <P>(iii) Subassemblies, components, and parts embedded within delivered items, items with warranty requirements, DoD serially managed reparables and DoD serially managed nonreparables as specified in Attachment Number ____.</P>
                                <P>(iv) Any item of special tooling or special test equipment as defined in FAR 2.101 that have been designated for preservation and storage for a Major Defense Acquisition Program as specified in Attachment Number ____.</P>
                                <P>(v) Any item not included in paragraphs (c)(1)(i), (ii), (iii), or (iv) of this clause for which the contractor creates and marks a unique item identifier for traceability.</P>
                                <P>(2) The unique item identifier assignment and its component data element combination shall not be duplicated on any other item marked or registered in the DoD Item Unique Identification Registry by the contractor.</P>
                                <P>(3) The unique item identifier component data elements shall be marked on an item using two dimensional data matrix symbology that complies with ISO/IEC International Standard 16022, Information technology—International symbology specification—Data matrix; ECC200 data matrix specification.</P>
                                <P>
                                    (4) 
                                    <E T="03">Data syntax and semantics of unique item identifiers.</E>
                                     The Contractor shall ensure that—
                                </P>
                                <P>(i) The data elements (except issuing agency code) of the unique item identifier are encoded within the data matrix symbol that is marked on the item using one of the following three types of data qualifiers, as determined by the Contractor:</P>
                                <P>(A) Application Identifiers (AIs) (Format Indicator 05 of ISO/IEC International Standard 15434), in accordance with ISO/IEC International Standard 15418, Information Technology—EAN/UCC Application Identifiers and Fact Data Identifiers and Maintenance and ANSI MH 10.8.2 Data Identifier and Application Identifier Standard.</P>
                                <P>(B) Data Identifiers (DIs) (Format Indicator 06 of ISO/IEC International Standard 15434), in accordance with ISO/IEC International Standard 15418, Information Technology—EAN/UCC Application Identifiers and Fact Data Identifiers and Maintenance and ANSI MH 10.8.2 Data Identifier and Application Identifier Standard.</P>
                                <P>(C) Text Element Identifiers (TEIs) (Format Indicator 12 of ISO/IEC International Standard 15434), in accordance with the Air Transport Association Common Support Data Dictionary; and</P>
                                <P>(ii) The encoded data elements of the unique item identifier conform to the transfer structure, syntax, and coding of messages and data formats specified for Format Indicators 05, 06, and 12 in ISO/IEC International Standard 15434, Information Technology-Transfer Syntax for High Capacity Automatic Data Capture Media.</P>
                                <P>
                                    (5) 
                                    <E T="03">Unique item identifier.</E>
                                </P>
                                <P>(i) The Contractor shall—</P>
                                <P>(A) Determine whether to—</P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) Serialize within the enterprise identifier;
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) Serialize within the part, lot, or batch number; or
                                </P>
                                <P>
                                    (
                                    <E T="03">3</E>
                                    ) Use a DoD recognized unique identification equivalent (e.g. Vehicle Identification Number); and
                                </P>
                                <P>(B) Place the data elements of the unique item identifier (enterprise identifier; serial number; DoD recognized unique identification equivalent; and for serialization within the part, lot, or batch number only: Original part, lot, or batch number) on items requiring marking by paragraph (c)(1) of this clause, based on the criteria provided in MIL-STD-130, Identification Marking of U.S. Military Property, latest version;</P>
                                <P>(C) Label shipments, storage containers and packages that contain uniquely identified items in accordance with the requirements of MIL-STD-129, Military Marking for Shipment and Storage, latest version; and</P>
                                <P>(D) Verify that the marks on items and labels on shipments, storage containers, and packages are machine readable and conform to the applicable standards. The contractor shall use an automatic identification technology device for this verification that has been programmed to the requirements of Appendix A, MIL-STD-130, latest version.</P>
                                <P>(ii) The issuing agency code—</P>
                                <P>(A) Shall not be placed on the item; and</P>
                                <P>(B) Shall be derived from the data qualifier for the enterprise identifier.</P>
                                <P>(d) For each item that requires item unique identification under paragraph (c)(1)(i), (ii), or (iv) of this clause or when item unique identification is provided under paragraph (c)(1)(v), in addition to the information provided as part of the Material Inspection and Receiving Report specified elsewhere in this contract, the Contractor shall report at the time of delivery, as part of the Material Inspection and Receiving Report, the following information:</P>
                                <P>(1) Unique item identifier.</P>
                                <P>
                                    (2) Unique item identifier type.
                                    <PRTPAGE P="464"/>
                                </P>
                                <P>(3) Issuing agency code (if concatenated unique item identifier is used).</P>
                                <P>(4) Enterprise identifier (if concatenated unique item identifier is used).</P>
                                <P>(5) Original part number (if there is serialization within the original part number).</P>
                                <P>(6) Lot or batch number (if there is serialization within the lot or batch number).</P>
                                <P>(7) Current part number (optional and only if not the same as the original part number).</P>
                                <P>(8) Current part number effective date (optional and only if current part number is used).</P>
                                <P>(9) Serial number (if concatenated unique item identifier is used).</P>
                                <P>(10) Government's unit acquisition cost.</P>
                                <P>(11) Unit of measure.</P>
                                <P>(12) Type designation of the item as specified in the contract schedule, if any.</P>
                                <P>(13) Whether the item is an item of Special Tooling or Special Test Equipment.</P>
                                <P>(14) Whether the item is covered by a warranty.</P>
                                <P>(e) For embedded subassemblies, components, and parts that require DoD item unique identification under paragraph (c)(1)(iii) of this clause or when item unique identification is provided under paragraph (c)(1)(v), the Contractor shall report as part of the Material Inspection and Receiving Report specified elsewhere in this contract, the following information:</P>
                                <P>(1) Unique item identifier of the parent item under paragraph (c)(1) of this clause that contains the embedded subassembly, component, or part.</P>
                                <P>(2) Unique item identifier of the embedded subassembly, component, or part.</P>
                                <P>(3) Unique item identifier type.**</P>
                                <P>(4) Issuing agency code (if concatenated unique item identifier is used).**</P>
                                <P>(5) Enterprise identifier (if concatenated unique item identifier is used).**</P>
                                <P>(6) Original part number (if there is serialization within the original part number).**</P>
                                <P>(7) Lot or batch number (if there is serialization within the lot or batch number).**</P>
                                <P>(8) Current part number (optional and only if not the same as the original part number).**</P>
                                <P>(9) Current part number effective date (optional and only if current part number is used).**</P>
                                <P>(10) Serial number (if concatenated unique item identifier is used).**</P>
                                <P>(11) Description.</P>
                                <FP>** Once per item.</FP>
                                <P>(f) The Contractor shall submit the information required by paragraphs (d) and (e) of this clause as follows:</P>
                                <P>
                                    (1) End items shall be reported using the receiving report capability in Wide Area WorkFlow (WAWF) in accordance with the clause at 252.232-7003. If WAWF is not required by this contract, and the contractor is not using WAWF, follow the procedures at 
                                    <E T="03">http://dodprocurementtoolbox.com/site/uidregistry/.</E>
                                </P>
                                <P>(2) Embedded items shall be reported by one of the following methods—</P>
                                <P>(i) Use of the embedded items capability in WAWF;</P>
                                <P>
                                    (ii) Direct data submission to the IUID Registry following the procedures and formats at 
                                    <E T="03">http://dodprocurementtoolbox.com/site/uidregistry/;</E>
                                     or
                                </P>
                                <P>
                                    (iii) Via WAWF as a deliverable attachment for exhibit line item number (
                                    <E T="03">fill in</E>
                                    ) ____, Unique Item Identifier Report for Embedded Items, Contract Data Requirements List, DD Form 1423.
                                </P>
                                <P>
                                    (g) 
                                    <E T="03">Subcontracts.</E>
                                     If the Contractor acquires by subcontract any item(s) for which item unique identification is required in accordance with paragraph (c)(1) of this clause, the Contractor shall include this clause, including this paragraph (g), in the applicable subcontract(s), including subcontracts for commercial products or commercial services.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[70 FR 20836, Apr. 22, 2005, as amended at 70 FR 35549, June 21, 2005; 72 FR 52298, Sept. 13, 2007; 73 FR 27464, May 13, 2008; 73 FR 46820, Aug. 12, 2008; 75 FR 59103, Sept. 27, 2010; 76 FR 33169, June 8, 2011; 76 FR 76320, Dec. 7, 2011; 78 FR 37990, June 25, 2013; 78 FR 76072, Dec. 16, 2013; 79 FR 30474, May 28, 2014; 81 FR 17043, Mar. 25, 2016; 87 FR 15818, Mar. 18, 2022; 88 FR 6589, Jan. 31, 2023; 88 FR 88537, Dec. 22, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.211-7004—252.211-7007</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.211-7008</SECTNO>
                            <SUBJECT>Use of Government-assigned Serial Numbers.</SUBJECT>
                            <P>As prescribed in 211.274-5(b), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Use of Government-assigned Serial Numbers (SEP 2010)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Government-assigned serial number</E>
                                     means a combination of letters or numerals in a fixed human-readable information format (text) conveying information about a major end item, which is provided to a contractor by the requiring activity with accompanying technical data instructions for marking the Government-assigned serial number on major end items to be delivered to the Government.
                                </P>
                                <P>
                                    <E T="03">Major end item</E>
                                     means a final combination of component parts and/or materials which is ready for its intended use and of such importance to operational readiness that review and control of inventory management functions (procurement, distribution, maintenance, disposal, and asset reporting) is required at all levels of life cycle management. Major end items include aircraft; ships; boats; motorized wheeled, tracked, and 
                                    <PRTPAGE P="465"/>
                                    towed vehicles for use on highway or rough terrain; weapon and missile end items; ammunition; and sets, assemblies, or end items having a major end item as a component.
                                </P>
                                <P>
                                    <E T="03">Unique item identifier (UII)</E>
                                     means a set of data elements permanently marked on an item that is globally unique and unambiguous and never changes in order to provide traceability of the item throughout its total life cycle. The term includes a concatenated UII or a DoD-recognized unique identification equivalent.
                                </P>
                                <P>(b) The Contractor shall mark the Government-assigned serial numbers on those major end items as specified by line item in the Schedule, in accordance with the technical instructions for the placement and method of application identified in the terms and conditions of the contract.</P>
                                <P>(c) The Contractor shall register the Government-assigned serial number along with the major end item's UII at the time of delivery in accordance with the provisions of the clause at DFARS 252.211-7003(d).</P>
                                <P>(d) The Contractor shall establish the UII for major end items for use throughout the life of the major end item. The Contractor may elect, but is not required, to use the Government-assigned serial number to construct the UII.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[75 FR 59103, Sept. 27, 2010, as amended at 88 FR 88537, Dec. 22, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.212-7000—252.212-7001</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.212-7002</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.213-7000</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.215-7000—252.215-7001</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.215-7002</SECTNO>
                            <SUBJECT>Cost estimating system requirements.</SUBJECT>
                            <P>As prescribed in 215.408(1), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Cost Estimating System Requirements (DEC 2012)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                </P>
                                <P>
                                    <E T="03">Acceptable estimating system</E>
                                     means an estimating system that complies with the system criteria in paragraph (d) of this clause, and provides for a system that—
                                </P>
                                <P>(1) Is maintained, reliable, and consistently applied;</P>
                                <P>(2) Produces verifiable, supportable, documented, and timely cost estimates that are an acceptable basis for negotiation of fair and reasonable prices;</P>
                                <P>(3) Is consistent with and integrated with the Contractor's related management systems; and</P>
                                <P>(4) Is subject to applicable financial control systems.</P>
                                <P>
                                    <E T="03">Estimating system</E>
                                     means the Contractor's policies, procedures, and practices for budgeting and planning controls, and generating estimates of costs and other data included in proposals submitted to customers in the expectation of receiving contract awards. Estimating system includes the Contractor's—
                                </P>
                                <P>(1) Organizational structure;</P>
                                <P>(2) Established lines of authority, duties, and responsibilities;</P>
                                <P>(3) Internal controls and managerial reviews;</P>
                                <P>(4) Flow of work, coordination, and communication; and</P>
                                <P>(5) Budgeting, planning, estimating methods, techniques, accumulation of historical costs, and other analyses used to generate cost estimates.</P>
                                <P>
                                    <E T="03">Significant deficiency</E>
                                     means a shortcoming in the system that materially affects the ability of officials of the Department of Defense to rely upon data and information produced by the system that is needed for management purposes.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">General.</E>
                                     The Contractor shall establish, maintain, and comply with an acceptable estimating system.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Applicability.</E>
                                     Paragraphs (d) and (e) of this clause apply if the Contractor is a large business and either—
                                </P>
                                <P>(1) In its fiscal year preceding award of this contract, received Department of Defense (DoD) prime contracts or subcontracts, totaling $50 million or more for which certified cost or pricing data were required; or</P>
                                <P>(2) In its fiscal year preceding award of this contract—</P>
                                <P>(i) Received DoD prime contracts or subcontracts totaling $10 million or more (but less than $50 million) for which certified cost or pricing data were required; and</P>
                                <P>(ii) Was notified, in writing, by the Contracting Officer that paragraphs (d) and (e) of this clause apply.</P>
                                <P>
                                    (d) 
                                    <E T="03">System requirements.</E>
                                     (1) The Contractor shall disclose its estimating system to the Administrative Contracting Officer (ACO), in writing. If the Contractor wishes the Government to protect the data and information as privileged or confidential, the Contractor must mark the documents with the appropriate legends before submission.
                                </P>
                                <P>(2) An estimating system disclosure is acceptable when the Contractor has provided the ACO with documentation that—</P>
                                <P>(i) Accurately describes those policies, procedures, and practices that the Contractor currently uses in preparing cost proposals; and</P>
                                <P>(ii) Provides sufficient detail for the Government to reasonably make an informed judgment regarding the acceptability of the Contractor's estimating practices.</P>
                                <P>
                                    (3) The Contractor shall—
                                    <PRTPAGE P="466"/>
                                </P>
                                <P>(i) Comply with its disclosed estimating system; and</P>
                                <P>(ii) Disclose significant changes to the cost estimating system to the ACO on a timely basis.</P>
                                <P>(4) The Contractor's estimating system shall provide for the use of appropriate source data, utilize sound estimating techniques and good judgment, maintain a consistent approach, and adhere to established policies and procedures. An acceptable estimating system shall accomplish the following functions:</P>
                                <P>(i) Establish clear responsibility for preparation, review, and approval of cost estimates and budgets.</P>
                                <P>(ii) Provide a written description of the organization and duties of the personnel responsible for preparing, reviewing, and approving cost estimates and budgets.</P>
                                <P>(iii) Ensure that relevant personnel have sufficient training, experience, and guidance to perform estimating and budgeting tasks in accordance with the Contractor's established procedures.</P>
                                <P>(iv) Identify and document the sources of data and the estimating methods and rationale used in developing cost estimates and budgets.</P>
                                <P>(v) Provide for adequate supervision throughout the estimating and budgeting process.</P>
                                <P>(vi) Provide for consistent application of estimating and budgeting techniques.</P>
                                <P>(vii) Provide for detection and timely correction of errors.</P>
                                <P>(viii) Protect against cost duplication and omissions.</P>
                                <P>(ix) Provide for the use of historical experience, including historical vendor pricing data, where appropriate.</P>
                                <P>(x) Require use of appropriate analytical methods.</P>
                                <P>(xi) Integrate data and information available from other management systems.</P>
                                <P>(xii) Require management review, including verification of compliance with the company's estimating and budgeting policies, procedures, and practices.</P>
                                <P>(xiii) Provide for internal review of, and accountability for, the acceptability of the estimating system, including the budgetary data supporting indirect cost estimates and comparisons of projected results to actual results, and an analysis of any differences.</P>
                                <P>(xiv) Provide procedures to update cost estimates and notify the Contracting Officer in a timely manner throughout the negotiation process.</P>
                                <P>(xv) Provide procedures that ensure subcontract prices are reasonable based on a documented review and analysis provided with the prime proposal, when practicable.</P>
                                <P>(xvi) Provide estimating and budgeting practices that consistently generate sound proposals that are compliant with the provisions of the solicitation and are adequate to serve as a basis to reach a fair and reasonable price.</P>
                                <P>(xvii) Have an adequate system description, including policies, procedures, and estimating and budgeting practices, that comply with the Federal Acquisition Regulation and Defense Federal Acquisition Regulation Supplement.</P>
                                <P>
                                    (e) 
                                    <E T="03">Significant deficiencies.</E>
                                     (1) The Contracting Officer will provide an initial determination to the Contractor, in writing, of any significant deficiencies. The initial determination will describe the deficiency in sufficient detail to allow the Contractor to understand the deficiency.
                                </P>
                                <P>(2) The Contractor shall respond within 30 days to a written initial determination from the Contracting Officer that identifies significant deficiencies in the Contractor's estimating system. If the Contractor disagrees with the initial determination, the Contractor shall state, in writing, its rationale for disagreeing.</P>
                                <P>(3) The Contracting Officer will evaluate the Contractor's response and notify the Contractor, in writing, of the Contracting Officer's final determination concerning—</P>
                                <P>(i) Remaining significant deficiencies;</P>
                                <P>(ii) The adequacy of any proposed or completed corrective action; and</P>
                                <P>(iii) System disapproval, if the Contracting Officer determines that one or more significant deficiencies remain.</P>
                                <P>(f) If the Contractor receives the Contracting Officer's final determination of significant deficiencies, the Contractor shall, within 45 days of receipt of the final determination, either correct the significant deficiencies or submit an acceptable corrective action plan showing milestones and actions to eliminate the significant deficiencies.</P>
                                <P>
                                    (g) 
                                    <E T="03">Withholding payments.</E>
                                     If the Contracting Officer makes a final determination to disapprove the Contractor's estimating system, and the contract includes the clause at 252.242-7005, Contractor Business Systems, the Contracting Officer will withhold payments in accordance with that clause.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[76 FR 28873, May 18, 2011, as amended at 77 FR 11366, Feb. 24, 2012; 77 FR 11775, Feb. 28, 2012; 77 FR 76941, Dec. 31, 2012; 83 FR 30825, June 29, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.215-7003</SECTNO>
                            <SUBJECT>Requirement for Submission of Data Other Than Certified Cost or Pricing Data—Canadian Commercial Corporation.</SUBJECT>
                            <P>As prescribed at 215.408(2)(i), use the following provision:</P>
                            <EXTRACT>
                                <PRTPAGE P="467"/>
                                <HD SOURCE="HD1">Requirement for Submission of Data Other Than Certified Cost or Pricing Data—Canadian Commercial Corporation (JUL 2012)</HD>
                                <P>(a) Submission of certified cost or pricing data is not required.</P>
                                <P>(b) Canadian Commercial Corporation shall obtain and provide the following:</P>
                                <P>(i) Profit rate or fee (as applicable).</P>
                                <P>(ii) Analysis provided by Public Works and Government Services Canada to the Canadian Commercial Corporation to determine a fair and reasonable price (comparable to the analysis required at FAR 15.404-1).</P>
                                <P>
                                    (iii) Data other than certified cost or pricing data necessary to permit a determination by the U.S. Contracting Officer that the proposed price is fair and reasonable [
                                    <E T="03">U.S. Contracting Officer to insert description of the data required in accordance with FAR 15.403-3(a)(1)</E>
                                    ].
                                </P>
                                <P>(c) As specified in FAR 15.403-3(a)(4), an offeror who does not comply with a requirement to submit data that the U.S. Contracting Officer has deemed necessary to determine price reasonableness or cost realism is ineligible for award unless the head of the contracting activity determines that it is in the best interest of the Government to make the award to that offeror.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[77 FR 43473, July 24, 2012, as amended at 78 FR 65217, Oct. 31, 2013; 83 FR 30825, June 29, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.215-7004</SECTNO>
                            <SUBJECT>Requirement for Submission of Data Other Than Certified Cost or Pricing Data—Modifications-Canadian Commercial Corporation.</SUBJECT>
                            <P>As prescribed at 215.408(2)(ii), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Requirement for Submission of Data Other Than Certified Cost or Pricing Data—Modifications—Canadian Commercial Corporation (OCT 2013)</HD>
                                <P>This clause, in lieu of FAR 52.215-21, applies only if award is to the Canadian Commercial Corporation.</P>
                                <P>(a) Submission of certified cost or pricing data is not required.</P>
                                <P>
                                    (b) Canadian Commercial Corporation shall obtain and provide the following for modifications that exceed $150,000 [
                                    <E T="03">or higher dollar value specified by the U.S. Contracting Officer in the solicitation</E>
                                    ].
                                </P>
                                <P>(i) Profit rate or fee (as applicable).</P>
                                <P>(ii) Analysis provided by Public Works and Government Services Canada to the Canadian Commercial Corporation to determine a fair and reasonable price (comparable to the analysis required at FAR 15.404-1).</P>
                                <P>
                                    (iii) Data other than certified cost or pricing data necessary to permit a determination by the U.S. Contracting Officer that the proposed price is fair and reasonable [
                                    <E T="03">U.S. Contracting Officer to insert description of the data required in accordance with FAR 15.403-3(a)(1)</E>
                                    ].
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[77 FR 43473, July 24, 2012, as amended at 78 FR 65217, Oct. 31, 2013; 83 FR 30825, June 29, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.215-7005</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.215-7006</SECTNO>
                            <SUBJECT>Use of Employees or Individual Subcontractors Who Are Members of the Selected Reserve.</SUBJECT>
                            <P>As prescribed in 215.370-3, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Use of Employees or Individual Subcontractors Who Are Members of the Selected Reserve (MAR 2022)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Selected Reserve</E>
                                     has the meaning given that term in 10 U.S.C. 10143. Selected Reserve members normally attend regular drills throughout the year and are the group of Reserves most readily available to the President.
                                </P>
                                <P>(b) If the Contractor stated in its offer that it intends to use members of the Selected Reserve in the performance of this contract—</P>
                                <P>(1) The Contractor shall use employees, or individual subcontractors, who are members of the Selected Reserve in the performance of the contract to the fullest extent consistent with efficient contract performance; and</P>
                                <P>(2) The Government has the right to terminate the contract for default if the Contractor willfully or intentionally fails to use members of the Selected Reserve, as employees or individual subcontractors, in the performance of the contract.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[73 FR 62212, Oct. 20, 2008, as amended at 87 FR 15814, Mar. 18, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.215-7007</SECTNO>
                            <SUBJECT>Notice of Intent to Resolicit.</SUBJECT>
                            <P>As prescribed at 215.371-6, use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Notice of Intent To Resolicit (JUN 2012)</HD>
                                <P>
                                    This solicitation provides offerors fewer than 30 days to submit proposals. In the event that only one offer is received in response to this solicitation, the Contracting 
                                    <PRTPAGE P="468"/>
                                    Officer may cancel the solicitation and resolicit for an additional period of at least 30 days in accordance with 215.371-2.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[77 FR 39139, June 29, 2012, as amended at 78 FR 65217, Oct. 31, 2013]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.215-7008</SECTNO>
                            <SUBJECT>Only One Offer.</SUBJECT>
                            <P>As prescribed at 215.408(3), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Only One Offer (DEC 2022)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Cost or pricing data requirements.</E>
                                     After initial submission of offers, if the Contracting Officer notifies the Offeror that only one offer was received, the Offeror agrees to—
                                </P>
                                <P>(1) Submit any additional cost or pricing data that is required in order to determine whether the price is fair and reasonable (10 U.S.C. 3705) or to comply with the statutory requirement for certified cost or pricing data (10 U.S.C. 3702 and FAR 15.403-3); and</P>
                                <P>(2) Except as provided in paragraph (b) of this provision, if the acquisition exceeds the certified cost or pricing data threshold and an exception to the requirement for certified cost or pricing data at FAR 15.403-1(b)(2) through (5) does not apply, certify all cost or pricing data in accordance with paragraph (c) of DFARS provision 252.215-7010, Requirements for Certified Cost or Pricing Data and Data Other Than Certified Cost or Pricing Data, of this solicitation.</P>
                                <P>
                                    (b) 
                                    <E T="03">Canadian Commercial Corporation.</E>
                                     If the Offeror is the Canadian Commercial Corporation, certified cost or pricing data are not required. If the Contracting Officer notifies the Canadian Commercial Corporation that additional data other than certified cost or pricing data are required in accordance with DFARS 225.870-4(c), the Canadian Commercial Corporation shall obtain and provide the following:
                                </P>
                                <P>(1) Profit rate or fee (as applicable).</P>
                                <P>(2) Analysis provided by Public Works and Government Services Canada to the Canadian Commercial Corporation to determine a fair and reasonable price (comparable to the analysis required at FAR 15.404-1).</P>
                                <P>
                                    (3) Data other than certified cost or pricing data necessary to permit a determination by the U.S. Contracting Officer that the proposed price is fair and reasonable 
                                    <E T="03">[U.S. Contracting Officer to provide description of the data required in accordance with FAR 15.403-3(a)(1) with the notification].</E>
                                </P>
                                <P>(4) As specified in FAR 15.403-3(a)(4), an offeror who does not comply with a requirement to submit data that the U.S. Contracting Officer has deemed necessary to determine price reasonableness or cost realism is ineligible for award unless the head of the contracting activity determines that it is in the best interest of the Government to make the award to that offeror.</P>
                                <P>
                                    (c) 
                                    <E T="03">Subcontracts.</E>
                                     Unless the Offeror is the Canadian Commercial Corporation, the Offeror shall insert the substance of this provision, including this paragraph (c), in all subcontracts exceeding the simplified acquisition threshold defined in FAR part 2.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[78 FR 65217, Oct. 31, 2013, as amended at 83 FR 30825, June 29, 2018; 84 FR 30950, June 28, 2019; 84 FR 33858, July 16, 2019; 87 FR 76997, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.215-7009</SECTNO>
                            <SUBJECT>Proposal Adequacy Checklist.</SUBJECT>
                            <P>As prescribed in 215.408(4), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Proposal Adequacy Checklist (MAR 2023)</HD>
                                <P>The offeror shall complete the following checklist, providing location of requested information, or an explanation of why the requested information is not provided. In preparation of the offeror's checklist, offerors may elect to have their prospective subcontractors use the same or similar checklist as appropriate.</P>
                            </EXTRACT>
                            <GPOTABLE COLS="4" OPTS="L2" CDEF="s100,xl100,10,xs60">
                                <TTITLE>Proposal Adequacy Checklist</TTITLE>
                                <BOXHD>
                                    <CHED H="1">References</CHED>
                                    <CHED H="1">Submission item</CHED>
                                    <CHED H="1">Proposal page No.</CHED>
                                    <CHED H="1">
                                        If not provided
                                        <LI>EXPLAIN</LI>
                                        <LI>(may use</LI>
                                        <LI>continuation</LI>
                                        <LI>pages)</LI>
                                    </CHED>
                                </BOXHD>
                                <ROW EXPSTB="03" RUL="s">
                                    <ENT I="21">
                                        <E T="03">GENERAL INSTRUCTIONS</E>
                                    </ENT>
                                </ROW>
                                <ROW EXPSTB="00">
                                    <ENT I="01">1. FAR 15.408, Table 15-2, Section I Paragraph A</ENT>
                                    <ENT>Is there a properly completed first page of the proposal per FAR 15.408 Table 15-2 I.A or as specified in the solicitation?</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">2. FAR 15.408, Table 15-2, Section I Paragraph A(7)</ENT>
                                    <ENT>Does the proposal identify the need for Government-furnished material/tooling/test equipment? Include the accountable contract number and contracting officer contact information if known.</ENT>
                                </ROW>
                                <ROW>
                                    <PRTPAGE P="469"/>
                                    <ENT I="01">3. FAR 15.408, Table 15-2, Section I Paragraph A(8)</ENT>
                                    <ENT>Does the proposal identify and explain notifications of noncompliance with Cost Accounting Standards Board or Cost Accounting Standards (CAS); any proposal inconsistencies with your disclosed practices or applicable CAS; and inconsistencies with your established estimating and accounting principles and procedures?</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">4. FAR 15.408, Table 15-2, Section I, Paragraph C(1)</ENT>
                                    <ENT>Does the proposal disclose any other known activity that could materially impact the costs?</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">FAR 2.101, “Cost or pricing data”</ENT>
                                    <ENT>
                                        This may include, but is not limited to, such factors as—
                                        <LI>(1) Vendor quotations;</LI>
                                        <LI>(2) Nonrecurring costs;</LI>
                                        <LI>(3) Information on changes in production methods and in production or purchasing volume;</LI>
                                        <LI>(4) Data supporting projections of business prospects and objectives and related operations costs;</LI>
                                    </ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="22"> </ENT>
                                    <ENT>
                                        (5) Unit-cost trends such as those associated with labor efficiency;
                                        <LI>(6) Make-or-buy decisions;</LI>
                                    </ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="22"> </ENT>
                                    <ENT>(7) Estimated resources to attain business goals; and</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="22"> </ENT>
                                    <ENT>(8) Information on management decisions that could have a significant bearing on costs.</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">5. FAR 15.408, Table 15-2, Section I Paragraph B</ENT>
                                    <ENT>Is an Index of all certified cost or pricing data and information accompanying or identified in the proposal provided and appropriately referenced?</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">6. FAR 15.403-1(b)</ENT>
                                    <ENT>Are there any exceptions to submission of certified cost or pricing data pursuant to FAR 15.403-1(b)? If so, is supporting documentation included in the proposal? (Note questions 18-20.)</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">7. FAR 15.408, Table 15-2, Section I Paragraph C(2)(i)</ENT>
                                    <ENT>Does the proposal disclose the judgmental factors applied and the mathematical or other methods used in the estimate, including those used in projecting from known data?</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">8. FAR 15.408, Table 15-2, Section I Paragraph C(2)(ii)</ENT>
                                    <ENT>Does the proposal disclose the nature and amount of any contingencies included in the proposed price?</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">9. FAR 15.408 Table 15-2, Section II, Paragraph A or B</ENT>
                                    <ENT>Does the proposal explain the basis of all cost estimating relationships (labor hours or material) proposed on other than a discrete basis?</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">10. FAR 15.408, Table 15-2, Section I Paragraphs D and E</ENT>
                                    <ENT>Is there a summary of total cost by element of cost and are the elements of cost cross-referenced to the supporting cost or pricing data? (Breakdowns for each cost element must be consistent with your cost accounting system, including breakdown by year.)</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">11. FAR 15.408, Table 15-2, Section I Paragraphs D and E</ENT>
                                    <ENT>If more than one Contract Line Item Number (CLIN) or sub Contract Line Item Number (sub-CLIN) is proposed as required by the RFP, are there summary total amounts covering all line items for each element of cost and is it cross-referenced to the supporting cost or pricing data?</ENT>
                                </ROW>
                                <ROW>
                                    <PRTPAGE P="470"/>
                                    <ENT I="01">12. FAR 15.408, Table 15-2, Section I Paragraph F</ENT>
                                    <ENT>Does the proposal identify any incurred costs for work performed before the submission of the proposal?</ENT>
                                </ROW>
                                <ROW RUL="s">
                                    <ENT I="01">13. FAR 15.408, Table 15-2, Section I Paragraph G</ENT>
                                    <ENT>Is there a Government forward pricing rate agreement (FPRA)? If so, the offeror shall identify the official submittal of such rate and factor data. If not, does the proposal include all rates and factors by year that are utilized in the development of the proposal and the basis for those rates and factors?</ENT>
                                </ROW>
                                <ROW EXPSTB="03" RUL="s">
                                    <ENT I="21">
                                        <E T="03">COST ELEMENTS</E>
                                    </ENT>
                                </ROW>
                                <ROW RUL="s">
                                    <ENT I="21">MATERIALS AND SERVICES</ENT>
                                </ROW>
                                <ROW EXPSTB="00" RUL="s">
                                    <ENT I="01">14. FAR 15.408, Table 15-2, Section II Paragraph A</ENT>
                                    <ENT>Does the proposal include a consolidated summary of individual material and services, frequently referred to as a Consolidated Bill of Material (CBOM), to include the basis for pricing? The offeror's consolidated summary shall include raw materials, parts, components, assemblies, subcontracts and services to be produced or performed by others, identifying as a minimum the item, source, quantity, and price.</ENT>
                                </ROW>
                                <ROW EXPSTB="03" RUL="s">
                                    <ENT I="21">SUBCONTRACTS (Purchased materials or services)</ENT>
                                </ROW>
                                <ROW EXPSTB="00">
                                    <ENT I="01">15. DFARS 215.404-3</ENT>
                                    <ENT>Has the offeror identified in the proposal those subcontractor proposals, for which the contracting officer has initiated or may need to request field pricing analysis?</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">
                                        16. FAR 15.404-3(c)
                                        <LI O="xl">FAR 52.244-2</LI>
                                    </ENT>
                                    <ENT>Per the thresholds of FAR 15.404-3(c), Subcontract Pricing Considerations, does the proposal include a copy of the applicable subcontractor's certified cost or pricing data?</ENT>
                                </ROW>
                                <ROW RUL="s">
                                    <ENT I="01">17. FAR 15.408, Table 15-2, Note 1; Section II Paragraph A</ENT>
                                    <ENT>Is there a price/cost analysis establishing the reasonableness of each of the proposed subcontracts included with the proposal? If the offeror's price/cost analyses are not provided with the proposal, does the proposal include a matrix identifying dates for receipt of subcontractor proposal, completion of fact finding for purposes of price/cost analysis, and submission of the price/cost analysis?</ENT>
                                </ROW>
                                <ROW EXPSTB="03" RUL="s">
                                    <ENT I="21">
                                        <E T="03">EXCEPTIONS TO CERTIFIED COST OR PRICING DATA</E>
                                    </ENT>
                                </ROW>
                                <ROW EXPSTB="00">
                                    <ENT I="01">18. FAR 52.215-20, FAR 2.101, “commercial product” or “commercial service”</ENT>
                                    <ENT>Has the offeror submitted an exception to the submission of certified cost or pricing data for commercial products or commercial services proposed either at the prime or subcontractor level, in accordance with provision 52.215-20?</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="22"> </ENT>
                                    <ENT>a. Has the offeror specifically identified the type of commercial product or commercial service claim (FAR 2.101 “commercial product” or “commercial service” definition), and the basis on which the commercial product or commercial service meets the definition?</ENT>
                                </ROW>
                                <ROW>
                                    <PRTPAGE P="471"/>
                                    <ENT I="22"> </ENT>
                                    <ENT>b. For modified commercial products (FAR 2.101 “commercial product” definition); did the offeror classify the modification(s) as either—</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="22"> </ENT>
                                    <ENT>i. A modification of a type customarily available in the commercial marketplace (paragraph (3)(i)); or</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="22"> </ENT>
                                    <ENT>ii. A minor modification (paragraph (3)(ii)) of a type not customarily available in the commercial marketplace made to meet Federal Government requirements not exceeding the thresholds in FAR 15.403-1(c)(3)(iii)(B)?</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="22"> </ENT>
                                    <ENT>c. For proposed commercial products “of a type”, or “evolved” or modified (FAR 2.101 “commercial product” definition), did the contractor provide a technical description of the differences between the proposed item and the comparison item(s)?</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">19.</ENT>
                                    <ENT>[Reserved]</ENT>
                                </ROW>
                                <ROW RUL="s">
                                    <ENT I="01">20. FAR 15.408, Table 15-2, Section II Paragraph A(1)</ENT>
                                    <ENT>Does the proposal support the degree of competition and the basis for establishing the source and reasonableness of price for each subcontract or purchase order priced on a competitive basis exceeding the threshold for certified cost or pricing data?</ENT>
                                </ROW>
                                <ROW EXPSTB="03" RUL="s">
                                    <ENT I="21">INTERORGANIZATIONAL TRANSFERS</ENT>
                                </ROW>
                                <ROW EXPSTB="00">
                                    <ENT I="01">21. FAR 15.408, Table 15-2, Section II Paragraph A.(2)</ENT>
                                    <ENT>For inter-organizational transfers proposed at cost, does the proposal include a complete cost proposal in compliance with Table 15-2?</ENT>
                                </ROW>
                                <ROW RUL="s">
                                    <ENT I="01">22. FAR 15.408, Table 15-2, Section II Paragraph A(1)</ENT>
                                    <ENT>For inter-organizational transfers proposed at price in accordance with FAR 31.205-26(e), does the proposal provide an analysis by the prime that supports the exception from certified cost or pricing data in accordance with FAR 15.403-1?</ENT>
                                </ROW>
                                <ROW EXPSTB="03" RUL="s">
                                    <ENT I="21">DIRECT LABOR</ENT>
                                </ROW>
                                <ROW EXPSTB="00">
                                    <ENT I="01">23. FAR 15.408, Table 15-2, Section II Paragraph B</ENT>
                                    <ENT>
                                        Does the proposal include a time phased (
                                        <E T="03">i.e.</E>
                                        ; monthly, quarterly) breakdown of labor hours, rates and costs by category or skill level? If labor is the allocation base for indirect costs, the labor cost must be summarized in order that the applicable overhead rate can be applied.
                                    </ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">24. FAR 15.408, Table 15-2, Section II Paragraph B</ENT>
                                    <ENT>For labor Basis of Estimates (BOEs), does the proposal include labor categories, labor hours, and task descriptions—(e.g.; Statement of Work reference, applicable CLIN, Work Breakdown Structure, rationale for estimate, applicable history, and time-phasing)?</ENT>
                                </ROW>
                                <ROW RUL="s">
                                    <ENT I="01">25. FAR subpart 22.10</ENT>
                                    <ENT>If covered by the Service Contract Labor Standards statute (41 U.S.C. chapter 67), are the rates in the proposal in compliance with the minimum rates specified in the statute?</ENT>
                                </ROW>
                                <ROW EXPSTB="03" RUL="s">
                                    <PRTPAGE P="472"/>
                                    <ENT I="21">
                                        <E T="03">INDIRECT COSTS</E>
                                    </ENT>
                                </ROW>
                                <ROW EXPSTB="00" RUL="s">
                                    <ENT I="01">26. FAR 15.408, Table 15-2, Section II Paragraph C</ENT>
                                    <ENT>Does the proposal indicate the basis of estimate for proposed indirect costs and how they are applied? (Support for the indirect rates could consist of cost breakdowns, trends, and budgetary data.)</ENT>
                                </ROW>
                                <ROW EXPSTB="03" RUL="s">
                                    <ENT I="21">
                                        <E T="03">OTHER COSTS</E>
                                    </ENT>
                                </ROW>
                                <ROW EXPSTB="00">
                                    <ENT I="01">27. FAR 15.408, Table 15-2, Section II Paragraph D</ENT>
                                    <ENT>Does the proposal include other direct costs and the basis for pricing? If travel is included does the proposal include number of trips, number of people, number of days per trip, locations, and rates (e.g. airfare, per diem, hotel, car rental, etc)?</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">28. FAR 15.408, Table 15-2, Section II Paragraph E</ENT>
                                    <ENT>If royalties exceed $1,500 does the proposal provide the information/data identified by Table 15-2?</ENT>
                                </ROW>
                                <ROW RUL="s">
                                    <ENT I="01">29. FAR 15.408, Table 15-2, Section II Paragraph F</ENT>
                                    <ENT>When facilities capital cost of money is proposed, does the proposal include submission of Form CASB-CMF or reference to an FPRA/FPRP and show the calculation of the proposed amount?</ENT>
                                </ROW>
                                <ROW EXPSTB="03" RUL="s">
                                    <ENT I="21">
                                        <E T="03">FORMATS FOR SUBMISSION OF LINE ITEM SUMMARIES</E>
                                    </ENT>
                                </ROW>
                                <ROW EXPSTB="00">
                                    <ENT I="01">30. FAR 15.408, Table 15-2, Section III</ENT>
                                    <ENT>Are all cost element breakdowns provided using the applicable format prescribed in FAR 15.408, Table 15-2 III? (or alternative format if specified in the request for proposal)</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">31. FAR 15.408, Table 15-2, Section III Paragraph B</ENT>
                                    <ENT>If the proposal is for a modification or change order, have cost of work deleted (credits) and cost of work added (debits) been provided in the format described in FAR 15.408, Table 15-2.III.B?</ENT>
                                </ROW>
                                <ROW RUL="s">
                                    <ENT I="01">32. FAR 15.408, Table 15-2, Section III Paragraph C</ENT>
                                    <ENT>For price revisions/redeterminations, does the proposal follow the format in FAR 15.408, Table 15-2.III.C?</ENT>
                                </ROW>
                                <ROW EXPSTB="03" RUL="s">
                                    <ENT I="21">
                                        <E T="03">OTHER</E>
                                    </ENT>
                                </ROW>
                                <ROW EXPSTB="00">
                                    <ENT I="01">33. FAR 16.4</ENT>
                                    <ENT>If an incentive contract type, does the proposal include offeror proposed target cost, target profit or fee, share ratio, and, when applicable, minimum/maximum fee, ceiling price?</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">34. FAR 16.203-4 and FAR 15.408 Table 15-2, Section II, Paragraphs A, B, C, and D</ENT>
                                    <ENT>If Economic Price Adjustments are being proposed, does the proposal show the rationale and application for the economic price adjustment?</ENT>
                                </ROW>
                                <ROW>
                                    <ENT I="01">35. FAR 52.232-28</ENT>
                                    <ENT>If the offeror is proposing Performance-Based Payments—did the offeror comply with FAR 52.232-28?</ENT>
                                </ROW>
                                <ROW>
                                    <PRTPAGE P="473"/>
                                    <ENT I="01">
                                        36. FAR 15.408(n)
                                        <LI O="xl">FAR 52.215-22</LI>
                                        <LI O="xl">FAR 52.215-23</LI>
                                    </ENT>
                                    <ENT>
                                        Excessive Pass-through Charges—Identification of Subcontract Effort: If the offeror intends to subcontract more than 70% of the total cost of work to be performed, does the proposal identify:
                                        <LI>(i) the amount of the offeror's indirect costs and profit applicable to the work to be performed by the proposed subcontractor(s); and (ii) a description of the added value provided by the offeror as related to the work to be performed by the proposed subcontractor(s)?</LI>
                                    </ENT>
                                </ROW>
                            </GPOTABLE>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[78 FR 18872, Mar. 28, 2013, as amended at 78 FR 65218, Oct. 31, 2013; 79 FR 4633, Jan. 29, 2014; 83 FR 30825, June 29, 2018; 88 FR 6589, Jan. 31, 2023; 88 FR 17356, Mar. 22, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.215-7010</SECTNO>
                            <SUBJECT>Requirements for Certified Cost or Pricing Data and Data Other Than Certified Cost or Pricing Data.</SUBJECT>
                            <P>
                                <E T="03">Basic.</E>
                                 As prescribed in 215.408(5)(i) and (5)(i)(A), use the following provision:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Requirements for Certified Cost or Pricing Data and Data Other Than Certified Cost or Pricing Data—Basic (MAY 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this provision—
                                </P>
                                <P>
                                    <E T="03">Market prices</E>
                                     means current prices that are established in the course of ordinary trade between buyers and sellers free to bargain and that can be substantiated through competition or from sources independent of the offerors.
                                </P>
                                <P>
                                    <E T="03">Non-Government sales</E>
                                     means sales of the supplies or services to non-Governmental entities for purposes other than governmental purposes.
                                </P>
                                <P>
                                    <E T="03">Relevant sales data</E>
                                     means information provided by an offeror on sales of the same or similar items that can be used to establish price reasonableness taking into consideration the age, volume, and nature of the transactions (including any related discounts, refunds, rebates, offsets, or other adjustments).
                                </P>
                                <P>
                                    <E T="03">Sufficient non-Government sales</E>
                                     means relevant sales data that reflects market pricing and contains enough information to make adjustments covered by Federal Acquisition Regulation (FAR) 15.404-1(b)(2)(ii)(B).
                                </P>
                                <P>
                                    <E T="03">Uncertified cost data</E>
                                     means the subset of “data other than certified cost or pricing data” (see FAR 2.101) that relates to cost.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Exceptions from certified cost or pricing data.</E>
                                     (1) In lieu of submitting certified cost or pricing data, the Offeror may submit a written request for exception by submitting the information described in paragraphs (b)(1)(i) and (ii) of this provision. The Contracting Officer may require additional supporting information, but only to the extent necessary to determine whether an exception should be granted and whether the price is fair and reasonable.
                                </P>
                                <P>
                                    (i) 
                                    <E T="03">Exception for prices set by law or regulation—Identification of the law or regulation establishing the prices offered.</E>
                                     If the prices are controlled under law by periodic rulings, reviews, or similar actions of a governmental body, attach a copy of the controlling document, unless it was previously submitted to the contracting office.
                                </P>
                                <P>
                                    (ii) 
                                    <E T="03">Commercial product or commercial service exception.</E>
                                     For a commercial product or commercial service exception, the Offeror shall submit, at a minimum, information that is adequate for determining commerciality and evaluating the reasonableness of the price for this acquisition, including prices at which the same product or service or similar products or services have been sold in the commercial market. Such information shall include—
                                </P>
                                <P>(A) For products or services previously determined to be commercial, the contract number and military department, defense agency, or other DoD component that rendered such determination, and if available, a Government point of contact;</P>
                                <P>(B) For subsystems of a major weapon system and components and spare parts of a major weapon system or subsystem of a major weapon system that have not previously been determined to be commercial—</P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) The comparable commercial product the Offeror sells to the general public or nongovernmental entities;
                                    <PRTPAGE P="474"/>
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) A comparison between the physical characteristics and functionality of the comparable commercial product and the subsystem, component, or spare part, including—
                                </P>
                                <P>
                                    (
                                    <E T="03">i</E>
                                    ) For products under paragraph (3)(i) of the “commercial product” definition at FAR 2.101, a description of the modification and documentation to support that the modification is customarily available in the marketplace; or
                                </P>
                                <P>
                                    (
                                    <E T="03">ii</E>
                                    ) For products under paragraph (3)(ii) of the “commercial product” definition at FAR 2.101, a detailed description of the modification and detailed technical data to demonstrate that the modification is minor (e.g., information on production processes and material differences); and
                                </P>
                                <P>
                                    (
                                    <E T="03">3</E>
                                    ) The national stock number (NSN) for the comparable commercial product, if one is assigned, and the NSN for the subsystem, component, or spare part, if one is assigned; or
                                </P>
                                <P>
                                    (
                                    <E T="03">4</E>
                                    ) If the Offeror does not sell a comparable commercial product to the general public or nongovernmental entities for purposes other than government purposes, the Offeror shall—
                                </P>
                                <P>
                                    (
                                    <E T="03">i</E>
                                    ) Notify the Contracting Officer in writing that it does not sell such a comparable product; and
                                </P>
                                <P>
                                    (
                                    <E T="03">ii</E>
                                    ) Provide the Contracting Officer with a comparison of the physical characteristics and functionality of the most comparable commercial product in the commercial market.
                                </P>
                                <P>(C) For items priced based on a catalog—</P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) A copy of or identification of the Offeror's current catalog showing the price for that item; and
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) If the catalog pricing provided with this proposal is not consistent with all relevant sales data, a detailed description of differences or inconsistencies between or among the relevant sales data, the proposed price, and the catalog price (including any related discounts, refunds, rebates, offsets, or other adjustments);
                                </P>
                                <P>(D) For items priced based on market pricing, a description of the nature of the commercial market, the methodology used to establish a market price, and all relevant sales data. The description shall be adequate to permit the DoD to verify the accuracy of the description;</P>
                                <P>(E) For items included on an active Federal Supply Service Multiple Award Schedule contract, proof that an exception has been granted for the schedule item; or</P>
                                <P>(F) For items provided by nontraditional defense contractors, a statement that the entity is not currently performing and has not performed, for at least the 1-year period preceding the solicitation of sources by DoD for the procurement or transaction, any contract or subcontract for DoD that is subject to full coverage under the cost accounting standards prescribed pursuant to 41 U.S.C. 1502 and the regulations implementing such section.</P>
                                <P>
                                    (c) 
                                    <E T="03">Requirements for certified cost or pricing data.</E>
                                     If the Offeror is not granted an exception from the requirement to submit certified cost or pricing data, the following applies:
                                </P>
                                <P>(1) The Offeror shall prepare and submit certified cost or pricing data and supporting attachments in accordance with the instructions contained in Table 15-2 of FAR 15.408, which is incorporated by reference with the same force and effect as though it were inserted here in full text. The instructions in Table 15-2 are incorporated as a mandatory format to be used in any resultant contract, unless the Contracting Officer and the Offeror agree to a different format and change this provision to use Alternate I.</P>
                                <P>(2) As soon as practicable after agreement on price, but before contract award (except for unpriced actions such as letter contracts), the Offeror shall submit a Certificate of Current Cost or Pricing Data, as prescribed by FAR 15.406-2.</P>
                                <P>
                                    (3) The Offeror is responsible for determining whether a subcontractor qualifies for an exception from the requirement for submission of certified cost or pricing data on the basis of adequate price competition, 
                                    <E T="03">i.e.,</E>
                                     two or more responsible offerors, competing independently, submit priced offers that satisfy the Government's expressed requirement in accordance with FAR 15.403-1(c)(1)(i).
                                </P>
                                <P>
                                    (d) 
                                    <E T="03">Requirements for data other than certified cost or pricing data.</E>
                                     (1) Data other than certified cost or pricing data submitted in accordance with this provision shall include the minimum information necessary to permit a determination that the proposed price is fair and reasonable, to include the requirements in Defense Federal Acquisition Regulation Supplement (DFARS) 215.402(a)(i), 215.404-1(b), and 234.7002(e).
                                </P>
                                <P>(2) In cases in which uncertified cost data is required, the information shall be provided in the form in which it is regularly maintained by the Offeror or prospective subcontractor in its business operations.</P>
                                <P>(3) If the Offeror redacts data that identifies the customer (see DFARS 234.7002(e)(2)), then the Offeror shall include, for each sale, the following signed statement with the data submitted:</P>
                                <P>
                                    “By submission of this data, the Offeror 
                                    <E T="03">[Offeror insert company name]</E>
                                     certifies that the customer was 
                                    <E T="03">[Offeror insert one or more of the following as applicable: a government customer; a commercial customer purchasing the same or similar product for governmental purposes (e.g., Federal, state, local, or foreign government); or a commercial customer purchasing the same or similar product for a commercial, mixed, or unknown purpose].</E>
                                    ”
                                    <PRTPAGE P="475"/>
                                </P>
                                <P>(4) Within 10 days of a written request from the Contracting Officer for additional information to permit an adequate evaluation of the proposed price in accordance with FAR 15.403-3 or DFARS 234.7002(e), the Offeror shall provide either the requested information, or a written explanation for the inability to fully comply.</P>
                                <P>
                                    (5) 
                                    <E T="03">Subcontract price evaluation.</E>
                                     (i) Offerors shall obtain from subcontractors the minimum information necessary to support a determination of price reasonableness, as described in FAR part 15 and DFARS part 215.
                                </P>
                                <P>(ii) No cost data may be required from a prospective subcontractor in any case in which there are sufficient non-Government sales of the same item to establish reasonableness of price.</P>
                                <P>(iii) If the Offeror relies on relevant sales data for similar items to determine the price is reasonable, the Offeror shall obtain only that technical information necessary—</P>
                                <P>(A) To support the conclusion that items are technically similar; and</P>
                                <P>(B) To explain any technical differences that account for variances between the proposed prices and the sales data presented.</P>
                                <P>
                                    (e) 
                                    <E T="03">Subcontracts.</E>
                                     The Offeror shall insert the substance of this provision, including this paragraph (e), in subcontracts exceeding the simplified acquisition threshold defined in FAR part 2. The Offeror shall require prospective subcontractors to adhere to the requirements of—
                                </P>
                                <P>(1) Paragraphs (c) and (d) of this provision for subcontracts above the threshold for submission of certified cost or pricing data in FAR 15.403-4; and</P>
                                <P>(2) Paragraph (d) of this provision for subcontracts exceeding the simplified acquisition threshold defined in FAR part 2.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <P>
                                <E T="03">Alternate I.</E>
                                 As prescribed in 215.408(5)(i) and (5)(i)(B), use the following provision, which includes a different paragraph (c)(1).
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Requirements for Certified Cost or Pricing Data and Data Other Than Certified Cost or Pricing Data—Alternate I (Aug 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this provision—
                                </P>
                                <P>
                                    <E T="03">Market prices</E>
                                     means current prices that are established in the course of ordinary trade between buyers and sellers free to bargain and that can be substantiated through competition or from sources independent of the offerors.
                                </P>
                                <P>
                                    <E T="03">Non-Government sales</E>
                                     means sales of the supplies or services to non-Governmental entities for purposes other than governmental purposes.
                                </P>
                                <P>
                                    <E T="03">Relevant sales data</E>
                                     means information provided by an offeror on sales of the same or similar items that can be used to establish price reasonableness taking into consideration the age, volume, and nature of the transactions (including any related discounts, refunds, rebates, offsets, or other adjustments).
                                </P>
                                <P>
                                    <E T="03">Sufficient non-Government sales</E>
                                     means relevant sales data that reflects market pricing and contains enough information to make adjustments covered by Federal Acquisition Regulation (FAR) 15.404-1(b)(2)(ii)(B).
                                </P>
                                <P>
                                    <E T="03">Uncertified cost data</E>
                                     means the subset of “data other than certified cost or pricing data” (see FAR 2.101) that relates to cost.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Exceptions from certified cost or pricing data.</E>
                                     (1) In lieu of submitting certified cost or pricing data, the Offeror may submit a written request for exception by submitting the information described in paragraphs (b)(1)(i) and (ii) of this provision. The Contracting Officer may require additional supporting information, but only to the extent necessary to determine whether an exception should be granted and whether the price is fair and reasonable.
                                </P>
                                <P>
                                    (i) 
                                    <E T="03">Exception for price set by law or regulation—Identification of the law or regulation establishing the price offered.</E>
                                     If the price is controlled under law by periodic rulings, reviews, or similar actions of a governmental body, attach a copy of the controlling document, unless it was previously submitted to the contracting office.
                                </P>
                                <P>
                                    (ii) 
                                    <E T="03">Commercial product or commercial service exception.</E>
                                     For a commercial product or commercial service exception, the Offeror shall submit, at a minimum, information that is adequate for determining commerciality and evaluating the reasonableness of the price for this acquisition, including prices at which the same product or service or similar products or services have been sold in the commercial market. Such information shall include—
                                </P>
                                <P>(A) For products or services previously determined to be commercial, the contract number and military department, defense agency, or other DoD component that rendered such determination, and if available, a Government point of contact;</P>
                                <P>(B) For subsystems of a major weapon system and components and spare parts of a major weapon system or subsystem of a major weapon system that have not previously been determined to be commercial—</P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) The comparable commercial product the Offeror sells to the general public or nongovernmental entities;
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) A comparison between the physical characteristics and functionality of the comparable commercial product and the subsystem, component, or spare part, including—
                                </P>
                                <P>
                                    (
                                    <E T="03">i</E>
                                    ) For products under paragraph (3)(i) of the “commercial product” definition at FAR 2.101, a description of the modification and 
                                    <PRTPAGE P="476"/>
                                    documentation to support that the modification is customarily available in the marketplace; or
                                </P>
                                <P>
                                    (
                                    <E T="03">ii</E>
                                    ) For products under paragraph (3)(ii) of the “commercial product” definition at FAR 2.101, a detailed description of the modification and detailed technical data to demonstrate that the modification is minor (e.g., information on production processes and material differences); and
                                </P>
                                <P>
                                    (
                                    <E T="03">3</E>
                                    ) The national stock number (NSN) for the comparable commercial product, if one is assigned, and the NSN for the subsystem, component, or spare part; or
                                </P>
                                <P>
                                    (
                                    <E T="03">4</E>
                                    ) If the Offeror does not sell a comparable commercial product to the general public or nongovernmental entities for purposes other than government purposes, the Offeror shall—
                                </P>
                                <P>
                                    (
                                    <E T="03">i</E>
                                    ) Notify the Contracting Officer in writing that it does not sell such a comparable product; and
                                </P>
                                <P>
                                    (
                                    <E T="03">ii</E>
                                    ) Provide the Contracting Officer with a comparison of the physical characteristics and functionality of the most comparable commercial product in the commercial market.
                                </P>
                                <P>(C) For items priced based on a catalog—</P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) A copy of or identification of the Offeror's current catalog showing the price for that item; and
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) If the catalog pricing provided with this proposal is not consistent with all relevant sales data, a detailed description of differences or inconsistencies between or among the relevant sales data, the proposed price, and the catalog price (including any related discounts, refunds, rebates, offsets, or other adjustments);
                                </P>
                                <P>(D) For items priced based on market pricing, a description of the nature of the commercial market, the methodology used to establish a market price, and all relevant sales data. The description shall be adequate to permit the DoD to verify the accuracy of the description;</P>
                                <P>(E) For items included on an active Federal Supply Service Multiple Award Schedule contract, proof that an exception has been granted for the schedule item; or</P>
                                <P>(F) For items provided by nontraditional defense contractors, a statement that the entity is not currently performing and has not performed, for at least the 1-year period preceding the solicitation of sources by the DoD for the procurement or transaction, any contract or subcontract for the DoD that is subject to full coverage under the cost accounting standards prescribed pursuant to 41 U.S.C. 1502 and the regulations implementing such section.</P>
                                <P>(2) The Offeror grants the Contracting Officer or an authorized representative the right to examine, at any time before award, books, records, documents, or other directly pertinent records to verify any request for an exception under this provision, and to determine the reasonableness of price.</P>
                                <P>
                                    (c) 
                                    <E T="03">Requirements for certified cost or pricing data.</E>
                                     If the Offeror is not granted an exception from the requirement to submit certified cost or pricing data, the following applies:
                                </P>
                                <P>
                                    (1) The Offeror shall submit certified cost or pricing data and supporting attachments in the following format: 
                                    <E T="03">[Insert description of the data and format that are required, and include access to records necessary to permit an adequate evaluation of the proposed price in accordance with FAR 15.408, Table 15-2, Note 2. The Contracting Officer shall insert the description at the time of issuing the solicitation or specify that the format regularly maintained by the offeror or prospective subcontractor in its business operations will be acceptable. The Contracting Officer may amend the description as the result of negotiations.]</E>
                                </P>
                                <P>(2) As soon as practicable after agreement on price, but before contract award (except for unpriced actions such as letter contracts), the Offeror shall submit a Certificate of Current Cost or Pricing Data, as prescribed by FAR 15.406-2.</P>
                                <P>
                                    (3) The Offeror is responsible for determining whether a subcontractor qualifies for an exception from the requirement for submission of certified cost or pricing data on the basis of adequate price competition, 
                                    <E T="03">i.e.,</E>
                                     two or more responsible offerors, competing independently, submit priced offers that satisfy the Government's expressed requirement in accordance with FAR 15.403-1(c)(1)(i).
                                </P>
                                <P>
                                    (d) 
                                    <E T="03">Requirements for data other than certified cost or pricing data.</E>
                                     (1) Data other than certified cost or pricing data submitted in accordance with this provision shall include all data necessary to permit a determination that the proposed price is fair and reasonable, to include the requirements in Defense Federal Acquisition Regulation Supplement (DFARS) 215.402(a)(i), 215.404-1(b), and 234.7002(e).
                                </P>
                                <P>(2) In cases in which uncertified cost data is required, the information shall be provided in the form in which it is regularly maintained by the Offeror or prospective subcontractor in its business operations.</P>
                                <P>(3) If the Offeror redacts data that identifies the customer (see DFARS 234.7002(e)(2)), then the Offeror shall include, for each sale, the following signed statement with the data submitted:</P>
                                <P>
                                    “By submission of this data, the Offeror 
                                    <E T="03">[Offeror insert company name]</E>
                                     certifies that the customer was 
                                    <E T="03">[Offeror insert one or more of the following as applicable: a government customer (e.g., Federal, state, local, or foreign government); a commercial customer purchasing the same or similar product for governmental purposes; or a commercial customer purchasing the same or similar product for a commercial, mixed, or unknown purpose]</E>
                                    .”
                                    <PRTPAGE P="477"/>
                                </P>
                                <P>
                                    (4) The Offeror shall provide information described as follows: 
                                    <E T="03">[Insert description of the data and the format that are required, including access to records necessary to permit an adequate evaluation of the proposed price in accordance with FAR 15.403-3 or DFARS 234.7002(e).]</E>
                                </P>
                                <P>(5) Within 10 days of a written request from the Contracting Officer for additional information to support proposal analysis, the Offeror shall provide either the requested information, or a written explanation for the inability to fully comply.</P>
                                <P>
                                    (6) 
                                    <E T="03">Subcontract price evaluation.</E>
                                     (i) Offerors shall obtain from subcontractors the information necessary to support a determination of price reasonableness, as described in FAR part 15 and DFARS part 215.
                                </P>
                                <P>(ii) No cost information may be required from a prospective subcontractor in any case in which there are sufficient non-Government sales of the same item to establish reasonableness of price.</P>
                                <P>(iii) If the Offeror relies on relevant sales data for similar items to determine the price is reasonable, the Offeror shall obtain only that technical information necessary—</P>
                                <P>(A) To support the conclusion that items are technically similar; and</P>
                                <P>(B) To explain any technical differences that account for variances between the proposed prices and the sales data presented.</P>
                                <P>
                                    (e) 
                                    <E T="03">Subcontracts.</E>
                                     The Offeror shall insert the substance of this provision, including this paragraph (e), in all subcontracts exceeding the simplified acquisition threshold defined in FAR part 2. The Offeror shall require prospective subcontractors to adhere to the requirements of—
                                </P>
                                <P>(1) Paragraph (c) and (d) of this provision for subcontracts above the threshold for submission of certified cost or pricing data in FAR 15.403-4; and</P>
                                <P>(2) Paragraph (d) of this provision for subcontracts exceeding the simplified acquisition threshold defined in FAR part 2.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[83 FR 4445, Jan. 31, 2018, as amended at 83 FR 30825, June 29, 2018; 84 FR 30950, June 28, 2019; 84 FR 33858, July 16, 2019; 88 FR 6590, Jan. 31, 2023; 89 FR 46809, May 30, 2024; 89 FR 66285, Aug. 15, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.215-7011</SECTNO>
                            <SUBJECT>Requirements for Submission of Proposals to the Administrative Contracting Officer and Contract Auditor.</SUBJECT>
                            <P>As prescribed in 215.408(5)(ii), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Requirements for Submission of Proposals to the Administrative Contracting Officer and Contract Auditor (JAN 2018)</HD>
                                <P>When the proposal is submitted, the Offeror shall also submit one copy each to—</P>
                                <P>(a) The Administrative Contracting Officer; and</P>
                                <P>(b) The Contract Auditor.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[83 FR 4447, Jan. 31, 2018, as amended at 83 FR 30825, June 29, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.215-7012</SECTNO>
                            <SUBJECT>Requirements for Submission of Proposals via Electronic Media.</SUBJECT>
                            <P>As prescribed in 215.408(5)(iii), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Requirements for Submission of Proposals Via Electronic Media (JAN 2018)</HD>
                                <P>
                                    The Offeror shall submit the cost portion of the proposal via the following electronic media: [
                                    <E T="03">Insert media format, e.g., electronic spreadsheet format, electronic mail, etc.</E>
                                    ]
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[83 FR 4447, Jan. 31, 2018, as amended at 83 FR 30825, June 29, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.215-7013</SECTNO>
                            <SUBJECT>Supplies and Services Provided by Nontraditional Defense Contractors.</SUBJECT>
                            <P>As prescribed in 215.408(6), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Supplies and Services Provided by Nontraditional Defense Contractors (JAN 2023)</HD>
                                <P>Offerors are advised that in accordance with 10 U.S.C. 3457, supplies and services provided by a nontraditional defense contractor, as defined in DFARS 202.101, may be treated as commercial products or commercial services. The decision to apply commercial product or commercial service procedures to the procurement of supplies and services from a nontraditional defense contractor does not require a commercial item determination and does not mean the supplies or services are commercial.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[83 FR 4447, Jan. 31, 2018, as amended at 83 FR 30825, June 29, 2018; 87 FR 76997, Dec. 16, 2022; 88 FR 6590, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="478"/>
                            <SECTNO>252.215-7014</SECTNO>
                            <SUBJECT>Exception from Certified Cost or Pricing Data Requirements for Foreign Military Sales Indirect Offsets.</SUBJECT>
                            <P>As prescribed in 215.408(8), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Exception From Certified Cost or Pricing Data Requirements for Foreign Military Sales Indirect Offsets (DEC 2022)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Offset</E>
                                     means a benefit or obligation agreed to by a contractor and a foreign government or international organization as an inducement or condition to purchase supplies or services pursuant to a foreign military sale (FMS). There are two types of offsets: Direct offsets and indirect offsets.
                                </P>
                                <P>(i) A direct offset involves benefits or obligations, including supplies or services that are directly related to the item being purchased and are integral to the deliverable of the FMS contract. For example, as a condition of a foreign military sale, the contractor may require or agree to permit the customer to produce in its country certain components or subsystems of the item being sold. Generally, direct offsets must be performed within a specified period, because they are integral to the deliverable of the FMS contract.</P>
                                <P>
                                    (ii) An indirect offset involves benefits or obligations, including supplies or services that are not directly related to the specific item(s) being purchased and are not integral to the deliverable of the FMS contract. For example, as a condition of a foreign military sale, the contractor may agree to purchase certain manufactured products, agricultural commodities, raw materials, or services, or make an equity investment or grant of equipment required by the FMS customer, or may agree to build a school, road or other facility. Indirect offsets would also include projects that are related to the FMS contract but not purchased under said contract (
                                    <E T="03">e.g.,</E>
                                     a project to develop or advance a capability, technology transfer, or know-how in a foreign company). Indirect offsets may be accomplished without a clearly defined period of performance.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Exceptions from certified cost or pricing data requirements.</E>
                                     Notwithstanding the requirements of Federal Acquisition Regulation (FAR) 52.215-20, Requirements for Certified Cost or Pricing Data and Data Other Than Certified Cost or Pricing Data, in the case of this contract or a subcontract, and FAR 52.215-21, Requirements for Certified Cost or Pricing Data and Data Other Than Certified Cost or Pricing Data—Modifications, in the case of modification of this contract or a subcontract, submission of certified cost or pricing data shall not be required to the extent such data relates to an indirect offset (10 U.S.C. 3703(a)(4)).
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[83 FR 30829, June 29, 2018; as amended at 87 FR 76997, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.215-7015</SECTNO>
                            <SUBJECT>Program Should-Cost Review.</SUBJECT>
                            <P>As prescribed in 215.408(8), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Program Should-Cost Review (NOV 2019)</HD>
                                <P>(a) The Government has the right to perform a program should-cost review, as described in Federal Acquisition Regulation (FAR) 15.407-4(b). The review may be conducted in support of a particular contract proposal or during contract performance to find opportunities to reduce program costs. The Government will communicate the elements of the proposed should-cost review to the prime contractor (Pub. L. 115-91).</P>
                                <P>(b) If the Government performs a program should-cost review, upon the Government's request, the Contractor shall provide access to accurate and complete cost data and Contractor facilities and personnel necessary to permit the Government to perform the program should-cost review.</P>
                                <P>(c) The Government has the right to use third-party experts to supplement the program should-cost review team. The Contractor shall provide access to the Contractor's facilities and information necessary to support the program should-cost review to any third-party experts who have signed non-disclosure agreements in accordance with the FAR 52.203-16.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[84 FR 65309, Nov. 27, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.215-7016</SECTNO>
                            <SUBJECT>Notification to Offerors—Postaward Debriefings.</SUBJECT>
                            <P>As prescribed in 215.570, use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Notification to Offerors—Postaward Debriefings (DEC 2022)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition.</E>
                                     As used in this provision—
                                </P>
                                <P>
                                    <E T="03">Nontraditional defense contractor</E>
                                     means an entity that is not currently performing and has not performed any contract or subcontract for DoD that is subject to full coverage under the cost accounting standards prescribed pursuant to 41 U.S.C. 1502 and the regulations implementing such section, for at least the 1-year period preceding the solicitation of sources by DoD for the procurement (10 U.S.C. 3014).
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Postaward debriefing.</E>
                                </P>
                                <P>
                                    (1) Upon timely request, the Government will provide a written or oral postaward debriefing to successful or unsuccessful 
                                    <PRTPAGE P="479"/>
                                    offerors for contract awards valued at $10 million or more, while protecting the confidential and proprietary information of other offerors. The request is considered timely if received within 3 days of notification of contract award.
                                </P>
                                <P>(2) When required, the minimum postaward debriefing information will include the following:</P>
                                <P>(i) For contracts in excess of $10 million and not in excess of $100 million with a small business or nontraditional defense contractor, an option for the small business or nontraditional defense contractor to request disclosure of the agency's written source selection decision document, redacted to protect the confidential and proprietary information of other offerors for the contract award.</P>
                                <P>(ii) For contracts in excess of $100 million, disclosure of the agency's written source selection decision document, redacted to protect the confidential and proprietary information of other offerors for the contract award.</P>
                                <P>(3) If a required postaward debriefing is provided—</P>
                                <P>(i) The debriefed Offeror may submit additional written questions related to the debriefing not later than 2 business days after the date of the debriefing;</P>
                                <P>(ii) The agency will respond in writing to timely submitted additional questions within 5 business days after receipt by the contracting officer; and</P>
                                <P>(iii) The postaward debriefing will not be considered to be concluded until the later of—</P>
                                <P>(A) The date that the postaward debriefing is delivered, orally or in writing; or</P>
                                <P>(B) If additional written questions related to the debriefing are timely received, the date the agency delivers its written response.</P>
                                <P>
                                    (c) 
                                    <E T="03">Contract performance.</E>
                                     The Government may suspend performance of or terminate the awarded contract upon notice from the Government Accountability Office of a protest filed within the time periods listed in paragraphs (c)(1) through (3) of this provision, whichever is later:
                                </P>
                                <P>(1) Within 10 days after the date of contract award.</P>
                                <P>(2) Within 5 days after a debriefing date offered to the protestor under a timely debriefing request in accordance with Federal Acquisition Regulation (FAR) 15.506 unless an earlier debriefing date is negotiated as a result.</P>
                                <P>(3) Within 5 days after a postaward debriefing under FAR 15.506 is concluded in accordance with Defense Federal Acquisition Regulation Supplement 215.506-70(b).</P>
                            </EXTRACT>
                            <FP>(End of provision)</FP>
                            <CITA>[87 FR 15811, Mar. 18, 2022, as amended at 87 FR 76997, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.216-7000</SECTNO>
                            <SUBJECT>Economic Price Adjustment—Basic Steel, Aluminum, Brass, Bronze, or Copper Mill Products.</SUBJECT>
                            <P>As prescribed in 216.203-4-70(a)(1), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Economic Price Adjustment—Basic Steel, Aluminum, Brass, Bronze, or Copper Mill Products (JAN 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Established price</E>
                                     means a price which is an established catalog or market price for a commercial product sold in substantial quantities to the general public.
                                </P>
                                <P>
                                    <E T="03">Unit price</E>
                                     excludes any part of the price which reflects requirements for preservation, packaging, and packing beyond standard commercial practice.
                                </P>
                                <P>
                                    (b) As represented by the Contractor in its offer, the unit price stated for ________________ (
                                    <E T="03">Identify the item</E>
                                    ) is not in excess of the Contractor's established price in effect on the date set for opening of bids (or the contract date if this is a negotiated contract) for like quantities of the same item. This price is the net price after applying any applicable standard trade discounts offered by the Contractor from its catalog, list, or schedule price.
                                </P>
                                <P>(c) The Contractor shall promptly notify the Contracting Officer of the amount and effective date of each decrease in any established price.</P>
                                <P>(1) Each corresponding contract unit price shall be decreased by the same percentage that the established price is decreased.</P>
                                <P>(2) This decrease shall apply to items delivered on or after the effective date of the decrease in the Contractor's established price.</P>
                                <P>(3) This contract shall be modified accordingly.</P>
                                <P>(d) If the Contractor's established price is increased after the date set for opening of bids (or the contract date if this is a negotiated contract), upon the Contractor's written request to the Contracting Officer, the corresponding contract unit price shall be increased by the same percentage that the established price is increased, and this contract shall be modified accordingly, provided—</P>
                                <P>(1) The aggregate of the increases in any contract unit price under this contract shall not exceed 10 percent of the original contract unit price;</P>
                                <P>
                                    (2) The increased contract unit price shall be effective on the effective date of the increase in the applicable established price if the Contractor's written request is received by the Contracting Officer within ten days of the change. If it is not, the effective date of the increased unit price shall be the date of receipt of the request by the Contracting Officer; and
                                    <PRTPAGE P="480"/>
                                </P>
                                <P>(3) The increased contract unit price shall not apply to quantities scheduled for delivery before the effective date of the increased contract unit price unless the Contractor's failure to deliver before that date results from causes beyond the control and without the fault or negligence of the Contractor, within the meaning of the Default clause of this contract.</P>
                                <P>(4) The Contracting Officer shall not execute a modification incorporating an increase in a contract unit price under this clause until the increase is verified.</P>
                                <P>(e) Within 30 days after receipt of the Contractor's written request, the Contracting Officer may cancel, without liability to either party, any portion of the contract affected by the requested increase and not delivered at the time of such cancellation, except as follows—</P>
                                <P>(1) The Contractor may, after that time, deliver any items that were completed or in the process of manufacture at the time of receipt of the cancellation notice, provided the Contractor notifies the Contracting Officer of such items within 10 days after the Contractor receives the cancellation notice.</P>
                                <P>(2) The Government shall pay for those items at the contract unit price increased to the extent provided by paragraph (d) of this clause.</P>
                                <P>(3) Any standard steel supply item shall be deemed to be in the process of manufacture when the steel for that item is in the state of processing after the beginning of the furnace melt.</P>
                                <P>(f) Pending any cancellation of this contract under paragraph (e) of this clause, or if there is no cancellation, the Contractor shall continue deliveries according to the delivery schedule of the contract. The Contractor shall be paid for those deliveries at the contract unit price increased to the extent provided by paragraph (d) of this clause.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 62 FR 2614, Jan. 17, 1997; 62 FR 40473, July 29, 1997; 77 FR 19130, Mar. 30, 2012; 88 FR 6590, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.216-7001</SECTNO>
                            <SUBJECT>Economic Price Adjustment-Nonstandard Steel Items.</SUBJECT>
                            <P>As prescribed in 216.203-4-70(b), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Economic Price Adjustment—Nonstandard Steel Items (JAN 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Base labor index</E>
                                     means the average of the labor indices for the three months which consist of the month of bid opening (or offer submission) and the months immediately preceding and following that month.
                                </P>
                                <P>
                                    <E T="03">Base steel index</E>
                                     means the Contractor's established price (see note 6) including all applicable extras of $________ per __________ (see note 1) for __________ (see note 2) on the date set for bid opening (or the date of submission of the offer).
                                </P>
                                <P>
                                    <E T="03">Current labor index</E>
                                     means the average of the labor indices for the month in which delivery of supplies is required to be made and the month preceding.
                                </P>
                                <P>
                                    <E T="03">Current steel index</E>
                                     means the Contractor's established price (see note 6) for that item, including all applicable extras in effect ________ days (see note 3) prior to the first day of the month in which delivery is required.
                                </P>
                                <P>
                                    <E T="03">Established price is</E>
                                    —
                                </P>
                                <P>(1) A price which is an established catalog or market price of a commercial product sold in substantial quantities to the general public; and</P>
                                <P>(2) The net price after applying any applicable standard trade discounts offered by the Contractor from its catalog, list, or schedule price. (But see Note 6.)</P>
                                <P>
                                    <E T="03">Labor index</E>
                                     means the average straight time hourly earnings of the Contractor's employees in the ________ shop of the Contractor's __________ plant (see note 4) for any particular month.
                                </P>
                                <P>
                                    <E T="03">Month</E>
                                     means calendar month. However, if the Contractor's accounting period does not coincide with the calendar month, then that accounting period shall be used in lieu of 
                                    <E T="03">month.</E>
                                </P>
                                <P>
                                    (b) Each contract unit price shall be subject to revision, under the terms of this clause, to reflect changes in the cost of labor and steel. For purpose of this price revision, the proportion of the contract unit price attributable to costs of labor not otherwise included in the price of the steel item identified under the 
                                    <E T="03">base steel index</E>
                                     definition in paragraph (a) shall be ______ percent, and the proportion of the contract unit price attributable to the cost of steel shall be ______ percent. (See note 5.)
                                </P>
                                <P>(c)(1) Unless otherwise specified in this contract, the labor index shall be computed by dividing the total straight time earnings of the Contractor's employees in the shop identified in paragraph (a) for any given month by the total number of straight time hours worked by those employees in that month.</P>
                                <P>
                                    (2) Any revision in a contract unit price to reflect changes in the cost of labor shall be computed solely by reference to the “
                                    <E T="03">base labor index</E>
                                    ” and the “
                                    <E T="03">current labor index.</E>
                                    ”
                                </P>
                                <P>
                                    (d) Any revision in a contract unit price to reflect changes in the cost of steel shall be computed solely by reference to the “
                                    <E T="03">base steel index</E>
                                    ” and the “
                                    <E T="03">current steel index.</E>
                                    ”
                                </P>
                                <P>
                                    (e)(1) Each contract unit price shall be revised for each month in which delivery of supplies is required to be made.
                                    <PRTPAGE P="481"/>
                                </P>
                                <P>(2) The revised contract unit price shall apply to the deliveries of those quantities required to be made in that month regardless of when actual delivery is made.</P>
                                <P>(3) Each revised contract unit price shall be computed by adding—</P>
                                <P>(i) The adjusted cost of labor (obtained by multiplying ______ percent of the contract unit price by a fraction, of which the numerator shall be the current labor index and the denominator shall be the base labor index);</P>
                                <P>(ii) The adjusted cost of steel (obtained by multiplying ______ percent of the contract unit price by a fraction, of which the numerator shall be the current steel index and the denominator shall be the base steel index); and</P>
                                <P>(iii) The amount equal to ______ percent of the original contract unit price (representing that portion of the unit price which relates neither to the cost of labor nor the cost of steel, and which is therefore not subject to revision (see note 5)).</P>
                                <P>(4) The aggregate of the increases in any contract unit price under this contract shall not exceed ten percent of the original contract unit price.</P>
                                <P>(5) Computations shall be made to the nearest one-hundredth of one cent.</P>
                                <P>(f)(1) Pending any revisions of the contract unit prices, the Contractor shall be paid the contract unit price for deliveries made.</P>
                                <P>(2) Within 30 days after final delivery (or such other period as may be authorized by the Contracting Officer), the Contractor shall furnish a statement identifying the correctness of—</P>
                                <P>
                                    (i) The average straight time hourly earnings of the Contractor's employees in the shop identified in paragraph (a) that are relevant to the computations of the 
                                    <E T="03">base labor index</E>
                                     and the 
                                    <E T="03">current labor index;</E>
                                     and
                                </P>
                                <P>
                                    (ii) The Contractor's established prices (see note 6), including all applicable extras for like quantities of the item that are relevant to the computation of the 
                                    <E T="03">base steel index</E>
                                     and the 
                                    <E T="03">current steel index.</E>
                                </P>
                                <P>(3) Upon request of the Contracting Officer, the Contractor shall make available all records used in the computation of the labor indices.</P>
                                <P>(4) Upon receipt of the statement, the Contracting Officer will compute the revised contract unit prices and modify the contract accordingly. No modification to this contract will be made pursuant to this clause until the Contracting Officer has verified the revised established price (see note 6).</P>
                                <P>(g)(1) In the event any item of this contract is subject to a total or partial termination for convenience, the month in which the Contractor receives notice of the termination, if prior to the month in which delivery is required, shall be considered the month in which delivery of the terminated item is required for the purposes of determining the current labor and steel indices under paragraphs (c) and (d).</P>
                                <P>(2) For any item which is not terminated for convenience, the month in which delivery is required under the contract shall continue to apply for determining those indices with respect to the quantity of the non-terminated item.</P>
                                <P>(3) If this contract is terminated for default, any price revision shall be limited to the quantity of the item which has been delivered by the Contractor and accepted by the Government prior to receipt by the Contractor of the notice of termination.</P>
                                <P>
                                    (h) If the Contractor's failure to make delivery of any required quantity arises out of causes beyond the control and without the fault or negligence of the Contractor, within the meaning of the clause of this contract entitled “
                                    <E T="03">Default</E>
                                    ,” the quantity not delivered shall be delivered as promptly as possible after the cessation of the cause of the failure, and the delivery schedule set forth in this contract shall be amended accordingly.
                                </P>
                                <P>Notes:</P>
                                <P>1 Offeror insert the unit price and unit measure of the standard steel mill item to be used in the manufacture of the contract item.</P>
                                <P>2 Offeror identify the standard steel mill item to be used in the manufacture of the contract item.</P>
                                <P>
                                    3 Offeror insert best estimate of the number of days required for processing the standard steel mill item in the shop identified under the 
                                    <E T="03">labor index</E>
                                     definition.
                                </P>
                                <P>
                                    4 Offeror identify the shop and plant in which the standard steel mill item identified under the 
                                    <E T="03">base steel index</E>
                                     definition will be finally fabricated or processed into the contract item.
                                </P>
                                <P>5 Offeror insert the same percentage figures for the corresponding blanks in paragraphs (b), (e)(3)(i), and (e)(3)(ii). In paragraph (e)(3)(iii), insert the percentage representing the difference between the sum of the percentages inserted in paragraph (b) and 100 percent.</P>
                                <P>
                                    6 In negotiated acquisitions of nonstandard steel items, when there is no 
                                    <E T="03">established price</E>
                                     or when it is not desirable to use this price, this paragraph may refer to another appropriate price basis, e.g., an established interplant price.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 62 FR 2614, Jan. 17, 1997; 62 FR 40473, July 29, 1997; 88 FR 6590, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="482"/>
                            <SECTNO>252.216-7002</SECTNO>
                            <SUBJECT>Alternate A, Time-and-Materials/Labor-Hour Proposal Requirements—Other Than Commercial Acquisition with Adequate Price Competition.</SUBJECT>
                            <P>As prescribed in 216.601(e), substitute the following paragraph (c) for paragraph (c) of the provision at FAR 52.216-29:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Alternate A, Time-and-Materials/Labor-Hour Proposal Requirements—Other Than Commercial Acquisition With Adequate Price Competition (JAN 2023)</HD>
                                <P>(c) The offeror must establish fixed hourly rates using separate rates for each category of labor to be performed by each subcontractor and for each category of labor to be performed by the offeror, and for each category of labor to be transferred between divisions, subsidiaries, or affiliates of the offeror under a common control.</P>
                            </EXTRACT>
                            <CITA>[71 FR 74471, Dec. 12, 2006, as amended at 88 FR 6591, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.216-7003</SECTNO>
                            <SUBJECT>Economic price adjustment—wage rates or material prices controlled by a foreign government.</SUBJECT>
                            <P>As prescribed in 216.203-4-70(c)(1), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Economic Price Adjustment—Wage Rates or Material Prices Controlled by a Foreign Government (MAR 2012)</HD>
                                <P>(a) As represented by the Contractor in its offer, the prices set forth in this contract—</P>
                                <P>(1) Are based on the wage rates or material prices established and controlled by the government of the country specified by the Contractor in its offer; and</P>
                                <P>(2) Do not include contingency allowances to pay for possible increases in wage rates or material prices.</P>
                                <P>(b) If wage rates or material prices are revised by the government named in paragraph (a) of this clause, the Contracting Officer shall make an equitable adjustment in the contract price and shall modify the contract to the extent that the Contractor's actual costs of performing this contract are increased or decreased, as a direct result of the revision, subject to the following:</P>
                                <P>(1) For increases in established wage rates or material prices, the increase in contract unit price(s) shall be effective on the same date that the government named in paragraph (a) of this clause increased the applicable wage rate(s) or material price(s), but only if the Contracting Officer receives the Contractor's written request for contract adjustment within 10 days of the change. If the Contractor's request is received later, the effective date shall be the date that the Contracting Officer received the Contractor's request.</P>
                                <P>(2) For decreases in established wage rates or material prices, the decrease in contract unit price(s) shall be effective on the same date that the government named in paragraph (a) of this clause decreased the applicable wage rate(s) or material price(s). The decrease in contract unit price(s) shall apply to all items delivered on and after the effective date of the government's rate or price decrease.</P>
                                <P>(c) No modification changing the contract unit price(s) shall be executed until the Contracting Officer has verified the applicable change in the rates or prices set by the government named in paragraph (a) of this clause. The Contractor shall make available its books and records that support a requested change in contract price.</P>
                                <P>(d) Failure to agree to any adjustment shall be a dispute under the Disputes clause of this contract.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[62 FR 34128, June 24, 1997]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.216-7004</SECTNO>
                            <SUBJECT>Award Fee Reduction or Denial for Jeopardizing the Health or Safety of Government Personnel.</SUBJECT>
                            <P>As prescribed in 216.406(e) use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Award Fee Reduction or Denial for Jeopardizing the Health or Safety of Government Personnel (SEP 2011)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Covered incident</E>
                                    —
                                </P>
                                <P>(i) Means any incident in which the Contractor, through a criminal, civil, or administrative proceeding that results in a disposition listed in paragraph (a)(ii) of this definition—</P>
                                <P>(A) Has been determined in the performance of this contract to have caused serious bodily injury or death of any civilian or military personnel of the Government through gross negligence or with reckless disregard for the safety of such personnel; or</P>
                                <P>(B) Has been determined to be liable for actions of a subcontractor of the Contractor that caused serious bodily injury or death of any civilian or military personnel of the Government through gross negligence or with reckless disregard for the safety of such personnel.</P>
                                <P>(ii) Includes those incidents that have resulted in any of the following dispositions:</P>
                                <P>(A) In a criminal proceeding, a conviction.</P>
                                <P>(B) In a civil proceeding, a finding of fault or liability that results in the payment of a monetary fine, penalty, reimbursement, restitution, or damage of $5,000 or more.</P>
                                <P>
                                    (C) In an administrative proceeding, a finding of fault and liability that results in—
                                    <PRTPAGE P="483"/>
                                </P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) The payment of a monetary fine or penalty of $5,000 or more; or
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) The payment of a reimbursement, restitution, or damages in excess of $100,000.
                                </P>
                                <P>(D) In a criminal, civil, or administrative proceeding, a disposition of the matter by consent or compromise with an acknowledgment of fault by the Contractor if the proceeding could have led to any of the outcomes specified in subparagraphs (a)(ii)(A), (a)(ii)</P>
                                <P>(B), or (a)(ii)(C).</P>
                                <P>(E) In a DoD investigation of the Contractor or its subcontractors at any tier not subject to the jurisdiction of the U.S. courts, a final determination by the Secretary of Defense of Contractor or subcontractor fault (see DFARS 216.405-2-70.</P>
                                <P>
                                    <E T="03">Serious bodily injury</E>
                                     means a grievous physical harm that results in a permanent disability.
                                </P>
                                <P>(b) If, in the performance of this contract, the Contractor's or its subcontractor's actions cause serious bodily injury or death of civilian or military Government personnel, the Government may reduce or deny the award fee for the period in which the covered incident occurred, including the recovery of all or part of any award fees paid for any previous period during which the covered incident occurred.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[76 FR 57677, Sept. 16, 2011, as amended at 83 FR 49181, Sept. 28, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.216-7006</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.216-7007</SECTNO>
                            <SUBJECT>Economic price adjustment—basic steel, aluminum, brass, bronze, or copper mill products-representation.</SUBJECT>
                            <P>As prescribed in 216.203-4-70(a)(2), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Economic Price Adjustment—Basic Steel, Aluminum, Brass, Bronze, or Copper Mill Products—Representation (MAR 2012)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     The terms “established price” and “unit price,” as used in this provision, have the meaning given in the clause 252.216-7000, Economic Price Adjustment—Basic Steel, Aluminum, Brass, Bronze, or Copper Mill Products.
                                </P>
                                <P>
                                    (b) By submission of its offer, the offeror represents that the unit price stated in this offer for ________________ (
                                    <E T="03">Identify the item</E>
                                    ) is not in excess of the offeror's established price in effect on the date set for opening of bids (or the contract date if this is to be a negotiated contract) for like quantities of the same item. This price is the net price after applying any applicable standard trade discounts offered by the offeror from its catalog, list, or schedule price.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[77 FR 19131, Mar. 30, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.216-7008</SECTNO>
                            <SUBJECT>Economic price adjustment—wage rates or material prices controlled by a foreign government—representation.</SUBJECT>
                            <P>As prescribed in 216.203-4-70(c)(2), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Economic Price Adjustment—Wage Rates or Material Prices Controlled by a Foreign Government—Representation (MAR 2012)</HD>
                                <P>(a) By submission of its offer, the offeror represents that the prices set forth in this offer—</P>
                                <P>
                                    (1) Are based on the wage rate(s) or material price(s) established and controlled by the government of ________________ (
                                    <E T="03">Offeror insert name of host country</E>
                                    ), and
                                </P>
                                <P>(2) Do not include contingency allowances to pay for possible increases in wage rates or material prices.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[77 FR 19131, Mar. 30, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.216-7009</SECTNO>
                            <SUBJECT>Allowability of Legal Costs Incurred in Connection with a Whistleblower Proceeding.</SUBJECT>
                            <P>As prescribed in 216.307(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Allowability of Legal Costs Incurred in Connection With a Whistleblower Proceeding (DEC 2022)</HD>
                                <P>Pursuant to 10 U.S.C. 3750, notwithstanding FAR clause 52.216-7, Allowable Cost and Payment—</P>
                                <P>(a) The restrictions of FAR 31.205-47(b) on allowability of costs related to legal and other proceedings also apply to any proceeding brought by a contractor employee submitting a complaint under 10 U.S.C. 4701, entitled “Contractor employees: protection from reprisal for disclosure of certain information;” and</P>
                                <P>(b) Costs incurred in connection with a proceeding that is brought by a contractor employee submitting a complaint under 10 U.S.C. 4701 are also unallowable if the result is an order to take corrective action under 10 U.S.C. 4701.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[78 FR 59861, Sept. 30, 2013, as amended at 87 FR 76997, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="484"/>
                            <SECTNO>252.216-7010</SECTNO>
                            <SUBJECT>Postaward Debriefings for Task Orders and Delivery Orders.</SUBJECT>
                            <P>As prescribed at 216.506-70(b), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Postaward Debriefings for Task Orders and Delivery Orders (DEC 2022)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Postaward debriefing.</E>
                                </P>
                                <P>(1) Upon timely request, the Government will provide a written or oral postaward debriefing for task orders or delivery orders valued at $10 million or more to the Contractor, regardless of whether the Contractor's offer for the task order or delivery order was successful or unsuccessful, while protecting the confidential and proprietary information of other contractors. The request is considered timely if received within 3 days of notification of task order or delivery order award.</P>
                                <P>(2) If a required postaward debriefing is provided—</P>
                                <P>(i) The debriefed Contractor may submit additional written questions related to the required and provided debriefing within 2 business days after the date of the debriefing;</P>
                                <P>(ii) The agency will respond in writing to timely submitted additional questions within 5 business days after receipt; and</P>
                                <P>(iii) The postaward debriefing will not be considered to be concluded until the later of—</P>
                                <P>(A) The date that the postaward debriefing is delivered, orally or in writing; or</P>
                                <P>(B) If additional written questions related to the debriefing are timely received, the date the agency delivers its written response.</P>
                                <P>
                                    (b) 
                                    <E T="03">Task order or delivery order performance.</E>
                                     The Government may suspend performance of or terminate the awarded task order or delivery order upon notice from the Government Accountability Office of a protest filed within the time periods listed in paragraphs (b)(1) through (3) of this clause, whichever is later:
                                </P>
                                <P>(1) Within 10 days after the date a task order or delivery order is issued, where the value exceeds $25 million (10 U.S.C. 3406(e)).</P>
                                <P>(2) Within 5 days after a debriefing date offered to the protestor under a timely debriefing request in accordance with Federal Acquisition Regulation (FAR) 15.506 unless an earlier debriefing date is negotiated as a result.</P>
                                <P>(3) Within 5 days after a postaward debriefing under FAR 15.506 is concluded in accordance with Defense Federal Acquisition Regulation Supplement 215.506-70(b).</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[87 FR 15811, Mar. 18, 2022, as amended at 87 FR 76997, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.217-7000</SECTNO>
                            <SUBJECT>Exercise of option to fulfill foreign military sales commitments.</SUBJECT>
                            <P>
                                <E T="03">Basic.</E>
                                 As prescribed in 217.208-70(a) and (a)(1), use the following clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Exercise of Option To Fulfill Foreign Military Sales Commitments—Basic (NOV 2014)</HD>
                                <P>(a) The Government may exercise the option(s) of this contract to fulfill foreign military sales commitments.</P>
                                <P>(b) The foreign military sales commitments are for:</P>
                                <FP SOURCE="FP-DASH"/>
                                <FP>(Insert name of country)</FP>
                                <FP SOURCE="FP-DASH"/>
                                <FP>(Insert applicable CLIN)</FP>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate I.</E>
                                 As prescribed in 217.208(a) and (a)(2), use the following clause, which uses a different paragraph (b) than paragraph (b) of the basic clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Exercise of Option to Fulfill Foreign Military Sales Commitments—Alternate I (NOV 2014)</HD>
                                <P>(a) The Government may exercise the option(s) of this contract to fulfill foreign military sales commitments.</P>
                                <P>(b) On the date the option is exercised, the Government shall identify the foreign country for the purpose of negotiating any equitable adjustment attributable to foreign military sales. Failure to agree on an equitable adjustment shall be treated as a dispute under the Disputes clause of this contract.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">End of clause</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 79 FR 65594, Nov. 5, 2014; 80 FR 36898, June 26, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.217-7001</SECTNO>
                            <SUBJECT>Surge option.</SUBJECT>
                            <P>As prescribed in 217.208-70(b), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Surge Option (DEC 2018)</HD>
                                <P>
                                    (a) 
                                    <E T="03">General.</E>
                                     The Government has the option to—
                                </P>
                                <P>
                                    (1) Increase the quantity of supplies or services called for under this contract by no more than ____percent or ____
                                    <E T="03">[insert quantity and description of services or supplies to be increased];</E>
                                     and/or
                                    <PRTPAGE P="485"/>
                                </P>
                                <P>(2) Accelerate the rate of delivery called for under this contract, at a price or cost established before contract award or to be established by negotiation as provided in this clause.</P>
                                <P>
                                    (b) 
                                    <E T="03">Schedule.</E>
                                     (1) When the Capabilities Analysis Plan (CAP) is included in the contract, the option delivery schedule shall be the production rate provided with the Plan. If the Plan was negotiated before contract award, then the negotiated schedule shall be used.
                                </P>
                                <P>(2) If there is no CAP in the contract, the Contractor shall, within 30 days from the date of award, furnish the Contracting Officer a delivery schedule showing the maximum sustainable rate of delivery for items in this contract. This delivery schedule shall provide acceleration by month up to the maximum sustainable rate of delivery achievable within the Contractor's existing facilities, equipment, and subcontracting structure.</P>
                                <P>(3) The Contractor shall not revise the option delivery schedule without approval from the Contracting Officer.</P>
                                <P>
                                    (c) 
                                    <E T="03">Exercise of option.</E>
                                     (1) The Contracting Officer may exercise this option at any time before acceptance by the Government of the final scheduled delivery.
                                </P>
                                <P>(2) The Contracting Officer will provide a preliminary oral or written notice to the Contractor stating the quantities to be added or accelerated under the terms of this clause, followed by a contract modification incorporating the transmitted information and instructions. The notice and modification will establish a not-to-exceed price equal to the highest contract unit price or cost of the added or accelerated items as of the date of the notice.</P>
                                <P>(3) The Contractor will not be required to deliver at a rate greater than the maximum sustainable delivery rate under paragraph (b)(2) of this clause, nor will the exercise of this option extend delivery more than 24 months beyond the scheduled final delivery.</P>
                                <P>
                                    (d) 
                                    <E T="03">Price negotiation.</E>
                                     (1) Unless the option cost or price was previously agreed upon, the Contractor shall, within 30 days from the date of option exercise, submit to the Contracting Officer a cost or price proposal (including a cost breakdown) for the added or accelerated items.
                                </P>
                                <P>(2) Failure to agree on a cost or price in negotiations resulting from the exercise of this option shall constitute a dispute concerning a question of fact within the meaning of the Disputes clause of this contract. However, nothing in this clause shall excuse the Contractor from proceeding with the performance of the contract, as modified, while any resulting claim is being settled.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 57 FR 42633, Sept. 15, 1992; 83 FR 62503, Dec. 4, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.217-7002</SECTNO>
                            <SUBJECT>Offering property for exchange.</SUBJECT>
                            <P>As prescribed in 217.7005, use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Offering Property for Exchange (JUN 2012)</HD>
                                <P>(a) The property described in item number ________, is being offered in accordance with the exchange provisions of 40 U.S.C. 503.</P>
                                <P>(b) The property is located at (insert address). Offerors may inspect the property during the period (insert beginning and ending dates and insert hours during day).</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 77 FR 35882, June 15, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.217-7003</SECTNO>
                            <SUBJECT>Changes.</SUBJECT>
                            <P>As prescribed in 217.7104(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Changes (DEC 1991)</HD>
                                <P>(a) The Contracting Officer may, at any time and without notice to the sureties, by written change order, make changes within the general scope of any job order issued under the Master Agreement in—</P>
                                <P>(1) Drawings, designs, plans, and specifications;</P>
                                <P>(2) Work itemized;</P>
                                <P>(3) Place of performance of the work;</P>
                                <P>(4) Time of commencement or completion of the work; and</P>
                                <P>(5) Any other requirement of the job order.</P>
                                <P>(b) If a change causes an increase or decrease in the cost of, or time required for, performance of the job order, whether or not changed by the order, the Contracting Officer shall make an equitable adjustment in the price or date of completion, or both, and shall modify the job order in writing.</P>
                                <P>(1) Within ten days after the Contractor receives notification of the change, the Contractor shall submit to the Contracting Officer a request for price adjustment, together with a written estimate of the increased cost.</P>
                                <P>(2) The Contracting Officer may grant an extension of this period if the Contractor requests it within the ten day period.</P>
                                <P>
                                    (3) If the circumstances justify it, the Contracting Officer may accept and grant a request for equitable adjustment at any later time prior to final payment under the job order, except that the Contractor may not 
                                    <PRTPAGE P="486"/>
                                    receive profit on a payment under a late request.
                                </P>
                                <P>(c) If the Contractor includes in its claim the cost of property made obsolete or excess as a result of a change, the Contracting Officer shall have the right to prescribe the manner of disposition of that property.</P>
                                <P>(d) Failure to agree to any adjustment shall be a dispute within the meaning of the Disputes clause.</P>
                                <P>(e) Nothing in this clause shall excuse the Contractor from proceeding with the job order as changed.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[75 FR 49849, Aug. 16, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.217-7004</SECTNO>
                            <SUBJECT>Job orders and compensation.</SUBJECT>
                            <P>As prescribed in 217.7104(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Job Orders and Compensation (MAY 2006)</HD>
                                <P>(a) The Contracting Officer shall solicit bids or proposals and make award of job orders. The issuance of a job order signed by the Contracting Officer constitutes award. The job order shall incorporate the terms and conditions of the Master Agreement.</P>
                                <P>(b) Whenever the Contracting Officer determines that a vessel, its cargo or stores, would be endangered by delay, or whenever the Contracting Officer determines that military necessity requires that immediate work on a vessel is necessary, the Contracting Officer may issue a written order to perform that work and the Contractor hereby agrees to comply with that order and to perform work on such vessel within its capabilities.</P>
                                <P>(1) As soon as practicable after the issuance of the order, the Contracting Officer and the Contractor shall negotiate a price for the work and the Contracting Officer shall issue a job order covering the work.</P>
                                <P>(2) The Contractor shall, upon request, furnish the Contracting Officer with a breakdown of costs incurred by the Contractor and an estimate of costs expected to be incurred in the performance of the work. The Contractor shall maintain, and make available for inspection by the Contracting Officer or the Contracting Officer's representative, records supporting the cost of performing the work.</P>
                                <P>(3) Failure of the parties to agree upon the price of the work shall constitute a dispute within the meaning of the Disputes clause of the Master Agreement. In the meantime, the Contractor shall diligently proceed to perform the work ordered.</P>
                                <P>(c)(1) If the nature of any repairs is such that their extent and probable cost cannot be ascertained readily, the Contracting Officer may issue a job order (on a sealed bid or negotiated basis) to determine the nature and extent of required repairs.</P>
                                <P>(2) Upon determination by the Contracting Officer of what work is necessary, the Contractor, if requested by the Contracting Officer, shall negotiate prices for performance of that work. The prices agreed upon shall be set forth in a modification of the job order.</P>
                                <P>(3) Failure of the parties to agree upon the price shall constitute a dispute under the Disputes clause. In the meantime, the Contractor shall diligently proceed to perform the work ordered.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[75 FR 49849, Aug. 16, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.217-7005</SECTNO>
                            <SUBJECT>Inspection and manner of doing work.</SUBJECT>
                            <P>As prescribed in 217.7104(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Inspection and Manner of Doing Work (JUL 2009)</HD>
                                <P>(a) The Contractor shall perform work in accordance with the job order, any drawings and specifications made a part of the job order, and any change or modification issued under the Changes clause of the Master Agreement.</P>
                                <P>(b)(1) Except as provided in paragraph (b) (2) of this clause, and unless otherwise specifically provided in the job order, all operational practices of the Contractor and all workmanship, material, equipment, and articles used in the performance of work under the Master Agreement shall be in accordance with the best commercial marine practices and the rules and requirements of the American Bureau of Shipping, the U.S. Coast Guard, and the Institute of Electrical and Electronic Engineers, in effect at the time of Contractor's submission of bid (or acceptance of the job order, if negotiated).</P>
                                <P>(2) When Navy specifications are specified in the job order, the Contractor shall follow Navy standards of material and workmanship. The solicitation shall prescribe the Navy standard whenever applicable.</P>
                                <P>(c) The Government may inspect and test all material and workmanship at any time during the Contractor's performance of the work.</P>
                                <P>(1) If, prior to delivery, the Government finds any material or workmanship is defective or not in accordance with the job order, in addition to its rights under the Guarantees clause of the Master Agreement, the Government may reject the defective or nonconforming material or workmanship and require the Contractor to correct or replace it at the Contractor's expense.</P>
                                <P>
                                    (2) If the Contractor fails to proceed promptly with the replacement or correction 
                                    <PRTPAGE P="487"/>
                                    of the material or workmanship, the Government may replace or correct the defective or nonconforming material or workmanship and charge the Contractor the excess costs incurred.
                                </P>
                                <P>(3) As specified in the job order, the Contractor shall provide and maintain an inspection system acceptable to the Government.</P>
                                <P>(4) The Contractor shall maintain complete records of all inspection work and shall make them available to the Government during performance of the job order and for 90 days after the completion of all work required.</P>
                                <P>(d) The Contractor shall not permit any welder to work on a vessel unless the welder is, at the time of the work, qualified to the standards established by the U.S. Coast Guard, American Bureau of Shipping, or Department of the Navy for the type of welding being performed. Qualifications of a welder shall be as specified in the job order.</P>
                                <P>(e) The Contractor shall—</P>
                                <P>(1) Exercise reasonable care to protect the vessel from fire;</P>
                                <P>(2) Maintain a reasonable system of inspection over activities taking place in the vicinity of the vessel's magazines, fuel oil tanks, or storerooms containing flammable materials;</P>
                                <P>(3) Maintain a reasonable number of hose lines ready for immediate use on the vessel at all times while the vessel is berthed alongside the Contractor's pier or in dry dock or on a marine railway;</P>
                                <P>(4) Unless otherwise provided in a job order, provide sufficient security patrols to reasonably maintain a fire watch for protection of the vessel when it is in the Contractor's custody;</P>
                                <P>(5) To the extent necessary, clean, wash, and steam out or otherwise make safe, all tanks under alteration or repair;</P>
                                <P>(6) Furnish the Contracting Officer or designated representative with a copy of the “gas-free” or “safe-for-hotwork” certificate, provided by a Marine Chemist or Coast Guard authorized person in accordance with Occupational Safety and Health Administration regulations (29 CFR 1915.14) before any hot work is done on a tank;</P>
                                <P>(7) Treat the contents of any tank as Government property in accordance with the Government Property clause; and</P>
                                <P>(8) Dispose of the contents of any tank only at the direction, or with the concurrence, of the Contracting Officer.</P>
                                <P>(f) Except as otherwise provided in the job order, when the vessel is in the custody of the Contractor or in dry dock or on a marine railway and the temperature is expected to go as low as 35 °F, the Contractor shall take all necessary steps to—</P>
                                <P>(1) Keep all hose pipe lines, fixtures, traps, tanks, and other receptacles on the vessel from freezing; and</P>
                                <P>(2) Protect the stern tube and propeller hubs from frost damage.</P>
                                <P>(g) The Contractor shall, whenever practicable—</P>
                                <P>(1) Perform the required work in a manner that will not interfere with the berthing and messing of Government personnel attached to the vessel; and</P>
                                <P>(2) Provide Government personnel attached to the vessel access to the vessel at all times.</P>
                                <P>(h) Government personnel attached to the vessel shall not interfere with the Contractor's work or workers.</P>
                                <P>(i)(1) The Government does not guarantee the correctness of the dimensions, sizes, and shapes set forth in any job order, sketches, drawings, plans, or specifications prepared or furnished by the Government, unless the job order requires that the Contractor perform the work prior to any opportunity to inspect.</P>
                                <P>(2) Except as stated in paragraph (i)(1) of this clause, and other than those parts furnished by the Government, the Contractor shall be responsible for the correctness of the dimensions, sizes, and shapes of parts furnished under this agreement.</P>
                                <P>(j) The Contractor shall at all times keep the site of the work on the vessel free from accumulation of waste material or rubbish caused by its employees or the work. At the completion of the work, unless the job order specifies otherwise, the Contractor shall remove all rubbish from the site of the work and leave the immediate vicinity of the work area “broom clean.”</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 62 FR 2614, Jan. 17, 1997; 74 FR 37647, July 29, 2009]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.217-7006</SECTNO>
                            <SUBJECT>Title.</SUBJECT>
                            <P>As prescribed in 217.7104(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Title (DEC 1991)</HD>
                                <P>(a) Unless otherwise provided, title to all materials and equipment to be incorporated in a vessel in the performance of a job order shall vest in the Government upon delivery at the location specified for the performance of the work.</P>
                                <P>(b) Upon completion of the job order, or with the approval of the Contracting Officer during performance of the job order, all Contractor-furnished materials and equipment not incorporated in, or placed on, any vessel, shall become the property of the Contractor, unless the Government has reimbursed the Contractor for the cost of the materials and equipment.</P>
                                <P>
                                    (c) The vessel, its equipment, movable stores, cargo, or other ship's materials shall 
                                    <PRTPAGE P="488"/>
                                    not be considered Government-furnished property.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.217-7007</SECTNO>
                            <SUBJECT>Payments.</SUBJECT>
                            <P>As prescribed in 217.7104(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Payments (DEC 1991)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Progress payments,</E>
                                     as used in this clause, means payments made before completion of work in progress under a job order.
                                </P>
                                <P>(b) Upon submission by the Contractor of invoices in the form and number of copies directed by the Contracting Officer, and as approved by the Contracting Officer, the Government will make progress payments as work progresses under the job order.</P>
                                <P>(1) Generally, the Contractor may submit invoices on a semi-monthly basis, unless expenditures justify a more frequent submission.</P>
                                <P>(2) The Government need not make progress payments for invoices aggregating less than $5,000.</P>
                                <P>(3) The Contracting Officer shall approve progress payments based on the value, computed on the price of the job order, of labor and materials incorporated in the work, materials suitably stored at the site of the work, and preparatory work completed, less the aggregate of any previous payments.</P>
                                <P>(4) Upon request, the Contractor will furnish the Contracting Officer any reports concerning expenditures on the work to date that the Contracting Officer may require.</P>
                                <P>(c) The Government will retain until final completion and acceptance of all work covered by the job order, an amount estimated or approved by the Contracting Officer under paragraph (b) of this clause. The amount retained will be in accordance with the rate authorized by Congress for Naval vessel repair contracts at the time of job order award.</P>
                                <P>(d) The Contracting Officer may direct that progress payments be based on the price of the job order as adjusted as a result of change orders under the Changes clause of the Master Agreement. If the Contracting Officer does not so direct—</P>
                                <P>(1) Payments of any increases shall be made from time to time after the amount of the increase is determined under the Changes clause of the Master Agreement; and</P>
                                <P>(2) Reductions resulting from decreases shall be made for the purposes of subsequent progress payments as soon as the amounts are determined under the Changes clause of the Master Agreement.</P>
                                <P>(e) Upon completion of the work under a job order and final inspection and acceptance, and upon submission of invoices in such form and with such copies as the Contracting Officer may prescribe, the Contractor shall be paid for the price of the job order, as adjusted pursuant to the Changes clause of the Master Agreement, less any performance reserves deemed necessary by the Contracting Officer, and less the amount of any previous payments.</P>
                                <P>(f) All materials, equipment, or any other property or work in process covered by the progress payments made by the Government, upon the making of those progress payments, shall become the sole property of the Government, and are subject to the provisions of the Title clause of the Master Agreement.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.217-7008</SECTNO>
                            <SUBJECT>Bonds.</SUBJECT>
                            <P>As prescribed in 217.7104(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Bonds (DEC 1991)</HD>
                                <P>(a) If the solicitation requires an offeror to submit a bid bond, the Offeror may furnish, instead, an annual bid bond (or evidence thereof) or an annual performance and payment bond (or evidence thereof).</P>
                                <P>(b) If the solicitation does not require a bid bond, the Offeror shall not include in the price any contingency to cover the premium of such a bond.</P>
                                <P>(c) Even if the solicitation does not require bonds, the Contracting Officer may nevertheless require a performance and payment bond, in form, amount, and with a surety acceptable to the Contracting Officer. Where performance and payment bond is required, the offer price shall be increased upon the award of the job order in an amount not to exceed the premium of a corporate surety bond.</P>
                                <P>(d) If any surety upon any bond furnished in connection with a job order under this agreement fails to submit requested reports as to its financial condition or otherwise becomes unacceptable to the Government, the Contracting Officer may require the Contractor to furnish whatever additional security the Contracting Officer determines necessary to protect the interests of the Government and of persons supplying labor or materials in the performance of the work contemplated under the Master Agreement.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.217-7009</SECTNO>
                            <SUBJECT>Default.</SUBJECT>
                            <P>As prescribed in 217.7104(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Default (DEC 1991)</HD>
                                <P>
                                    (a) The Government may, subject to the provisions of paragraph (b) of this clause, by written notice of default to the Contractor, 
                                    <PRTPAGE P="489"/>
                                    terminate the whole or any part of a job order if the Contractor fails to—
                                </P>
                                <P>(1) Make delivery of the supplies or to perform the services within the time specified in a job order or any extension;</P>
                                <P>(2) Make progress, so as to endanger performance of the job order; or</P>
                                <P>(3) Perform any of the other provisions of this agreement or a job order.</P>
                                <P>(b) Except for defaults of subcontractors, the Contractor shall not be liable for any excess costs if failure to perform the job order arises from causes beyond the control and without the fault or negligence of the Contractor. Examples of such causes include acts of God or of the public enemy, acts of the Government in either its sovereign or contractual capacity, fires, floods, epidemics, quarantine restrictions, strikes, freight embargoes, and unusually severe weather.</P>
                                <P>(c) If the Contractor's failure to perform is caused by the default of a subcontractor, and if such default arises out of causes beyond the control of both the Contractor and subcontractor, and without the fault or negligence of either, the Contractor shall not be liable for any excess costs for failure to perform, unless the supplies or services to be furnished by the subcontractor were obtainable from other sources in sufficient time to permit the Contractor to perform the job order within the time specified.</P>
                                <P>(d) If the Government terminates the job order in whole or in part as provided in paragraph (a) of this clause—</P>
                                <P>(1) The Government may, upon such terms and in such manner as the Contracting Officer may deem appropriate, arrange for the completion of the work so terminated, at such plant or plants, including that of the Contractor, as may be designated by the Contracting Officer.</P>
                                <P>(i) The Contractor shall continue the performance of the job order to the extent not terminated under the provisions of this clause.</P>
                                <P>(ii) If the work is to be completed at the plant, the Government may use all tools, machinery, facilities, and equipment of the Contractor determined by the Contracting Office to be necessary for that purpose.</P>
                                <P>(iii) If the cost to the Government of the work procured or completed (after adjusting such cost to exclude the effect of changes in the plans and specifications made subsequent to the date of termination) exceeds the price fixed for work under the job order (after adjusting such price on account of changes in the plans and specifications made before the date of termination), the Contractor, or the Contractor's surety, if any, shall be liable for such excess.</P>
                                <P>(2) The Government, in addition to any other rights provided in this clause, may require the Contractor to transfer title and delivery to the Government, in the manner and to the extent directed by the Contracting Officer, any completed supplies and such partially completed supplies and materials, parts, tools, dies, jigs, fixtures, plans, drawings, information and contract rights (hereinafter called “manufacturing materials”) as the Contractor has specifically produced or specifically acquired for the performance of the terminated part of the job order.</P>
                                <P>(i) The Contractor shall, upon direction of the Contracting Officer, protect and preserve property in possession of the Contractor in which the Government has an interest.</P>
                                <P>(ii) The Government shall pay to the Contractor the job order price for completed items of work delivered to and accepted by the Government, and the amount agreed upon by the Contractor and the Contracting Officer for manufacturing materials delivered to and accepted by the Government, and for the protection and preservation of property. Failure to agree shall be a dispute concerning a question of fact within the meaning of the Disputes clause.</P>
                                <P>(e) If, after notice of termination of the job order, it is determined that the Contractor was not in default, or that the default was excusable, the rights and obligations of the parties shall be the same as if the notice of termination had been issued for the convenience of the Government.</P>
                                <P>(f) If the Contractor fails to complete the performance of a job order within the time specified, or any extension, the actual damage to the Government for the delay will be difficult or impossible to determine.</P>
                                <P>(1) In lieu of actual damage, the Contractor shall pay to the Government as fixed, agreed, and liquidated damages for each calendar day of delay the amount, if any, set forth in the job order (prorated to the nearest hour for fractional days).</P>
                                <P>(2) If the Government terminates the job order, the Contractor shall be liable, in addition to the excess costs provided in paragraph (d) of this clause, for liquidated damages accruing until such time as the Government may reasonably obtain completion of the work.</P>
                                <P>(3) The Contractor shall not be charged with liquidated damages when the delay arises out of causes beyond the control and without the fault or negligence of the Contractor. Subject to the provisions of the Disputes clause of the Master Agreement, the Contracting Officer shall ascertain the facts and the extent of the delay and shall extend the time for performance when in the judgment of the Contracting Officer, the findings of fact justify an extension.</P>
                                <P>(g) The rights and remedies of the Government provided in this clause shall not be exclusive and are in addition to any other rights and remedies provided by law under this agreement.</P>
                            </EXTRACT>
                            <PRTPAGE P="490"/>
                            <HD SOURCE="HD3">(End of clause)</HD>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.217-7010</SECTNO>
                            <SUBJECT>Performance.</SUBJECT>
                            <P>As prescribed in 217.7104(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Performance (JUL 2009)</HD>
                                <P>(a) Upon the award of a job order, the Contractor shall promptly start the work specified and shall diligently prosecute the work to completion. The Contractor shall not start work until the job order has been awarded except in the case of emergency work ordered by the Contracting Officer under the Job Orders and Compensation clause of the Master Agreement.</P>
                                <P>(b) The Government shall deliver the vessel described in the job order at the time and location specified in the job order. Upon completion of the work, the Government shall accept delivery of the vessel at the time and location specified in the job order.</P>
                                <P>(c) The Contractor shall, without charge and without specific requirement in a job order,—</P>
                                <P>(1) Make available at the plant to personnel of the vessel while in dry dock or on a marine railway, sanitary lavatory and similar facilities acceptable to the Contracting Officer;</P>
                                <P>(2) Supply and maintain suitable brows and gangways from the pier, dry dock, or marine railway to the vessel;</P>
                                <P>(3) Treat salvage, scrap or other ship's material of the Government resulting from performance of the work as items of Government-furnished property, in accordance with the Government Property clause;</P>
                                <P>(4) Perform, or pay the cost of, any repair, reconditioning or replacement made necessary as the result of the use by the Contractor of any of the vessel's machinery, equipment or fittings, including, but not limited to, winches, pumps, rigging, or pipe lines; and</P>
                                <P>(5) Furnish suitable offices, office equipment and telephones at or near the site of the work for the Government's use.</P>
                                <P>(d) The job order will state whether dock and sea trials are required to determine whether or not the Contractor has satisfactorily performed the work.</P>
                                <P>(1) If dock and sea trials are required, the vessel shall be under the control of the vessel's commander and crew.</P>
                                <P>(2) The Contractor shall not conduct dock and sea trials not specified in the job order without advance approval of the Contracting Officer. Dock and sea trials not specified in the job order shall be at the Contractor's expense and risk.</P>
                                <P>(3) The Contractor shall provide and install all fittings and appliances necessary for dock and sea trials. The Contractor shall be responsible for care, installation, and removal of instruments and apparatus furnished by the Government for use in the trials.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 74 FR 37648, July 29, 2009]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.217-7011</SECTNO>
                            <SUBJECT>Access to vessel.</SUBJECT>
                            <P>As prescribed at 217.7104(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Access to Vessel (DEC 1991)</HD>
                                <P>(a) Upon the request of the Contracting Officer, the Contractor shall grant admission to the Contractor's facilities and access to vessel, on a non-interference basis, as necessary to perform their respective responsibilities, to a reasonable number of:</P>
                                <P>(1) Government and other Government contractor employees (in addition to those Government employees attached to the vessel); and</P>
                                <P>(2) Representatives of offerors on other contemplated Government work.</P>
                                <P>(b) All personnel granted access shall comply with Contractor rules governing personnel at its shipyard.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.217-7012</SECTNO>
                            <SUBJECT>Liability and insurance.</SUBJECT>
                            <P>As prescribed in 217.7104(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Liability and Insurance (AUG 2003)</HD>
                                <P>(a) The Contractor shall exercise its best efforts to prevent accidents, injury, or damage to all employees, persons, and property, in and about the work, and to the vessel or part of the vessel upon which work is done.</P>
                                <P>
                                    (b) 
                                    <E T="03">Loss or damage to the vessel, materials, or equipment.</E>
                                     (1) Unless otherwise directed or approved in writing by the Contracting Officer, the Contractor shall not carry insurance against any form of loss or damage to the vessel(s) or to the materials or equipment to which the Government has title or which have been furnished by the Government for installation by the Contractor. The Government assumes the risks of loss of and damage to that property.
                                </P>
                                <P>(2) The Government does not assume any risk with respect to loss or damage compensated for by insurance or otherwise or resulting from risks with respect to which the Contractor has failed to maintain insurance, if available, as required or approved by the Contracting Officer.</P>
                                <P>(3) The Government does not assume risk of and will not pay for any costs of the following:</P>
                                <P>
                                    (i) Inspection, repair, replacement, or renewal of any defects in the vessel(s) or material and equipment due to—
                                    <PRTPAGE P="491"/>
                                </P>
                                <P>(A) Defective workmanship performed by the Contractor or its subcontractors;</P>
                                <P>(B) Defective materials or equipment furnished by the Contractor or its subcontracts; or</P>
                                <P>(C) Workmanship, materials, or equipment which do not conform to the requirements of the contract, whether or not the defect is latent or whether or not the nonconformance is the result of negligence.</P>
                                <P>(ii) Loss, damage, liability, or expense caused by, resulting from, or incurred as a consequence of any delay or disruption, willful misconduct or lack of good faith by the Contractor or any of its representatives that have supervision or direction of—</P>
                                <P>(A) All or substantially all of the Contractor's business; or</P>
                                <P>(B) All or substantially all of the Contractor's operation at any one plant.</P>
                                <P>(4) As to any risk that is assumed by the Government, the Government shall be subrogated to any claim, demand or cause of action against third parties that exists in favor of the Contractor. If required by the Contracting Officer, the Contractor shall execute a formal assignment or transfer of the claim, demand, or cause of action.</P>
                                <P>(5) No party other than the Contractor shall have any right to proceed directly against the Government or join the Government as a co-defendant in any action.</P>
                                <P>(6) Notwithstanding the foregoing, the Contractor shall bear the first $50,000 of loss or damage from each occurrence or incident, the risk of which the Government would have assumed under the provisions of this paragraph (b).</P>
                                <P>
                                    (c) 
                                    <E T="03">Indemnification.</E>
                                     The Contractor indemnifies the Government and the vessel and its owners against all claims, demands, or causes of action to which the Government, the vessel or its owner(s) might be subject as a result of damage or injury (including death) to the property or person of anyone other than the Government or its employees, or the vessel or its owner, arising in whole or in part from the negligence or other wrongful act of the Contractor or its agents or employees, or any subcontractor, or its agents or employees.
                                </P>
                                <P>(1) The Contractor's obligation to indemnify under this paragraph shall not exceed the sum of $300,000 as a consequence of any single occurrence with respect to any one vessel.</P>
                                <P>(2) The indemnity includes, without limitation, suits, actions, claims, costs, or demands of any kind, resulting from death, personal injury, or property damage occurring during the period of performance of work on the vessel or within 90 days after redelivery of the vessel. For any claim, etc., made after 90 days, the rights of the parties shall be as determined by other provisions of this agreement and by law. The indemnity does apply to death occurring after 90 days where the injury was received during the period covered by the indemnity.</P>
                                <P>
                                    (d) 
                                    <E T="03">Insurance.</E>
                                     (1) The Contractor shall, at its own expense, obtain and maintain the following insurance—
                                </P>
                                <P>(i) Casualty, accident, and liability insurance, as approved by the Contracting Officer, insuring the performance of its obligations under paragraph (c) of this clause.</P>
                                <P>(ii) Workers Compensation Insurance (or its equivalent) covering the employees engaged on the work.</P>
                                <P>(2) The Contractor shall ensure that all subcontractors engaged on the work obtain and maintain the insurance required in paragraph (d)(1) of this clause.</P>
                                <P>(3) Upon request of the Contracting Officer, the Contractor shall provide evidence of the insurance required by paragraph (d) of this clause.</P>
                                <P>(e) The Contractor shall not make any allowance in the job order price for the inclusion of any premium expense or charge for any reserve made on account of self-insurance for coverage against any risk assumed by the Government under this clause.</P>
                                <P>(f) The Contractor shall give the Contracting Officer written notice as soon as practicable after the occurrence of a loss or damage for which the Government has assumed the risk.</P>
                                <P>(1) The notice shall contain full details of the loss or damage.</P>
                                <P>(2) If a claim or suit is later filed against the Contractor as a result of the event, the Contractor shall immediately deliver to the Government every demand, notice, summons, or other process received by the Contractor or its employees or representatives.</P>
                                <P>(3) The Contractor shall cooperate with the Government and, upon request, shall assist in effecting settlements, securing and giving evidence, obtaining the attendance of witnesses, and in the conduct of suits. The Government shall reimburse the Contractor for expenses incurred in this effort, other than the cost of maintaining the Contractor's usual organization.</P>
                                <P>(4) The Contractor shall not, except at its own expense, voluntarily make any payment, assume any obligation, or incur any expense other than what would be imperative for the protection of the vessel(s) at the time of the event.</P>
                                <P>(g) In the event or loss of or damage to any vessel(s), material, or equipment which may result in a claim against the Government under the insurance provisions of this contract, the Contractor shall promptly notify the Contracting Officer of the loss or damage. The Contracting Officer may, without prejudice to any other right of the Government, either—</P>
                                <P>
                                    (1) Order the Contractor to proceed with replacement or repair, in which event the Contractor shall effect the replacement or repair;
                                    <PRTPAGE P="492"/>
                                </P>
                                <P>(i) The Contractor shall submit to the Contracting Officer a request for reimbursement of the cost of the replacement or repair together with whatever supporting documentation the Contracting Officer may reasonably require, and shall identify the request as being submitted under the Insurance clause of the agreement.</P>
                                <P>(ii) If the Government determines that the risk of the loss or damage is within the scope of the risks assumed by the Government under this clause, the Government will reimburse the Contractor for the reasonable, allowable cost of the replacement or repair, plus a reasonable profit (if the work or replacement or repair was performed by the Contractor) less the deductible amount specified in paragraph (b) of this clause.</P>
                                <P>(iii) Payments by the Government to the Contractor under this clause are outside the scope of and shall not affect the pricing structure of the contract, and are additional to the compensation otherwise payable to the Contractor under this contract; or</P>
                                <P>(2) In the event the Contracting Officer decides that the loss or damage shall not be replaced or repaired, the Contracting Officer shall—</P>
                                <P>(i) Modify the contract appropriately, consistent with the reduced requirements reflected by the unreplaced or unrepaired loss or damage; or</P>
                                <P>(ii) Terminate the repair of any part or all of the vessel(s) under the Termination for Convenience of the Government clause of this agreement.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 68 FR 50478, Aug. 21, 2003]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.217-7013</SECTNO>
                            <SUBJECT>Guarantees.</SUBJECT>
                            <P>As prescribed in 217.7104(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Guarantees (DEC 1991)</HD>
                                <P>(a) In the event any work performed or materials furnished by the contractor under the Master Agreement prove defective or deficient within 90 days from the date of redelivery of the vessel(s), the Contractor, as directed by the Contracting Officer and at its own expense, shall correct and repair the deficiency to the satisfaction of the Contracting Officer.</P>
                                <P>(b) If the Contractor or any subcontractor has a guarantee for work performed or materials furnished that exceeds the 90 day period, the Government shall be entitled to rely upon the longer guarantee until its expiration.</P>
                                <P>(c) With respect to any individual work item identified as incomplete at the time of redelivery of the vessel(s), the guarantee period shall run from the date the item is completed.</P>
                                <P>(d) If practicable, the Government shall give the Contractor an opportunity to correct the deficiency.</P>
                                <P>(1) If the Contracting Officer determines it is not practicable or is otherwise not advisable to return the vessel(s) to the Contractor, or the Contractor fails to proceed with the repairs promptly, the Contracting Officer may direct that the repairs be performed elsewhere, at the Contractor's expense.</P>
                                <P>(2) If correction and repairs are performed by other than the Contractor, the Contracting Officer may discharge the Contractor's liability by making an equitable deduction in the price of the job order.</P>
                                <P>(e) The Contractor's liability shall extend for an additional 90 day guarantee period on those defects or deficiencies that the Contractor corrected.</P>
                                <P>(f) At the option of the Contracting Officer, defects and deficiencies may be left uncorrected. In that event, the Contractor and Contracting Officer shall negotiate an equitable reduction in the job price. Failure to agree upon an equitable reduction shall constitute a dispute under the Disputes clause of this agreement.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.217-7014</SECTNO>
                            <SUBJECT>Discharge of liens.</SUBJECT>
                            <P>As prescribed in 217.7104(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Discharge of Liens (DEC 1991)</HD>
                                <P>
                                    (a) The Contractor shall immediately discharge, or cause to be discharged, any lien or right 
                                    <E T="03">in rem</E>
                                     of any kind, other than in favor of the Government, that exists or arises in connection with work done or material furnished under any job order under this agreement.
                                </P>
                                <P>
                                    (b) If any lien or right 
                                    <E T="03">in rem</E>
                                     is not immediately discharged, the Government, at the expense of the Contractor, may discharge, or cause to be discharged, the lien or right.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.217-7015</SECTNO>
                            <SUBJECT>Safety and health.</SUBJECT>
                            <P>As prescribed in 217.7104(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Safety and Health (DEC 1991)</HD>
                                <P>Nothing contained in the Master Agreement or any job order shall relieve the Contractor of any obligations it may have to comply with—</P>
                                <P>
                                    (a) The Occupational Safety and Health Act of 1970 (29 U.S.C. 651, 
                                    <E T="03">et seq.</E>
                                    );
                                </P>
                                <P>
                                    (b) The Safety and Health Regulations for Ship Repairing (29 CFR part 1915); or
                                    <PRTPAGE P="493"/>
                                </P>
                                <P>(c) Any other applicable Federal, State, and local laws, codes, ordinances, and regulations.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.217-7016</SECTNO>
                            <SUBJECT>Plant protection.</SUBJECT>
                            <P>As prescribed in 217.7104(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Plant Protection (DEC 1991)</HD>
                                <P>(a) The Contractor shall provide, for the plant and work in process, reasonable safeguards against all hazards, including unauthorized entry, malicious mischief, theft, vandalism, and fire.</P>
                                <P>(b) The Contractor shall also provide whatever additional safeguards are necessary to protect the plant and work in process from espionage, sabotage, and enemy action.</P>
                                <P>(1) The Government shall reimburse the Contractor for that portion of the costs of the additional safeguards that is allocable to the contract in the same manner as if the Contracting Officer had issued a change order for the additional safeguards.</P>
                                <P>(2) The costs reimbursed shall not include any overhead allowance, unless the overhead is incident to the construction or installation of necessary security devices or equipment.</P>
                                <P>(c) Upon payment by the Government of the cost of any device or equipment required or approved under paragraph (b) of this clause, title shall vest in the Government.</P>
                                <P>(1) The Contractor shall comply with the instructions of the Contracting Officer concerning its identification and disposition.</P>
                                <P>(2) No such device or equipment shall become a fixture as a result of its being affixed to realty not owned by the Government.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.217-7017—252.217-7025</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.217-7026</SECTNO>
                            <SUBJECT>Identification of Sources of Supply.</SUBJECT>
                            <P>As prescribed in 217.7303, use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Identification of Sources of Supply (JAN 2023)</HD>
                                <P>(a) The Government is required under 10 U.S.C. 4753 to obtain certain information on the actual manufacturer or sources of supplies it acquires.</P>
                                <P>(b) The apparently successful Offeror agrees to complete and submit the following table before award:</P>
                                <GPOTABLE COLS="7" OPTS="L2(4,0,4)" CDEF="s25,r25,r25,r25,r25,r25,r25">
                                    <TTITLE>Table</TTITLE>
                                    <BOXHD>
                                        <CHED H="1">Line items</CHED>
                                        <CHED H="1">National stock No.</CHED>
                                        <CHED H="1">Commercial item (Y or N)</CHED>
                                        <CHED H="1">Source of supply</CHED>
                                        <CHED H="2">Company</CHED>
                                        <CHED H="2">Address</CHED>
                                        <CHED H="2">Part No.</CHED>
                                        <CHED H="1">Actual mfg?</CHED>
                                    </BOXHD>
                                    <ROW RUL="s">
                                        <ENT I="25">(1)</ENT>
                                        <ENT>(2)</ENT>
                                        <ENT>(3)</ENT>
                                        <ENT>(4)</ENT>
                                        <ENT>(4)</ENT>
                                        <ENT>(5)</ENT>
                                        <ENT>(6)</ENT>
                                    </ROW>
                                    <ROW>
                                        <ENT I="01">______</ENT>
                                        <ENT>______</ENT>
                                        <ENT>______</ENT>
                                        <ENT>______</ENT>
                                        <ENT>______</ENT>
                                        <ENT>______</ENT>
                                        <ENT>______</ENT>
                                    </ROW>
                                    <TNOTE>(1) List each deliverable item of supply and item of technical data.</TNOTE>
                                    <TNOTE>(2) If there is no national stock number, list “none”.;</TNOTE>
                                    <TNOTE>(3) Use “Y” if the item is a commercial product or commercial service; otherwise use “N.” If “Y” is listed, the Offeror need not complete the remaining columns in the table.</TNOTE>
                                    <TNOTE>(4) For items of supply, list all sources. For technical data, list the source.</TNOTE>
                                    <TNOTE>(5) For items of supply, list each source's part number for the item.</TNOTE>
                                    <TNOTE>(6) Use “Y” if the source of supply is the actual manufacturer; “N” if it is not; and “U” if unknown.</TNOTE>
                                </GPOTABLE>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 59 FR 27675, May 27, 1994; 60 FR 61601, Nov. 30, 1995; 87 FR 76997, Dec. 16, 2022; 88 FR 6591, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.217-7027</SECTNO>
                            <SUBJECT>Contract Definitization.</SUBJECT>
                            <P>As prescribed in 217.7406(b), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Contract Definitization (MAY 2023)</HD>
                                <P>
                                    (a) A___ 
                                    <E T="03">[insert specific type of contract action]</E>
                                     is contemplated. The Contractor agrees to begin promptly negotiating with the Contracting Officer the terms of a definitive contract that will include—
                                </P>
                                <P>(1) All clauses required by the Federal Acquisition Regulation (FAR) on the date of execution of the undefinitized contract action;</P>
                                <P>(2) All clauses required by law on the date of execution of the definitive contract action; and</P>
                                <P>(3) Any other mutually agreeable clauses, terms, and conditions.</P>
                                <P>
                                    (b) The Contractor agrees to submit a___ 
                                    <E T="03">[insert type of proposal; e.g., fixed-price or cost-and-fee]</E>
                                     proposal and certified cost or pricing data supporting its proposal. Notwithstanding FAR 52.216-26, Payments of Allowable Costs Before Definitization, failure to meet the qualifying proposal date in the contract definitization schedule could result in the Contracting Officer withholding an 
                                    <PRTPAGE P="494"/>
                                    amount up to 5 percent of all subsequent requests for financing until the Contracting Officer determines that a proposal is qualifying.
                                </P>
                                <P>
                                    (c) The schedule for definitizing this contract action is as follows 
                                    <E T="03">[insert target date for definitization of the contract action and dates for submission of proposal, beginning of negotiations, and, if appropriate, submission of the make-or-buy and subcontracting plans and certified cost or pricing data]:</E>
                                </P>
                                <FP SOURCE="FP-DASH"/>
                                <FP SOURCE="FP-DASH"/>
                                <FP SOURCE="FP-DASH"/>
                                <FP SOURCE="FP-DASH"/>
                                <P>(d) If agreement on a definitive contract action to supersede this undefinitized contract action is not reached by the target date in paragraph (c) of this clause, or within any extension of it granted by the Contracting Officer, the Contracting Officer may, with the approval of the head of the contracting activity, determine a reasonable price or fee in accordance with FAR subpart 15.4 and part 31, subject to Contractor appeal as provided in the Disputes clause. In any event, the Contractor shall proceed with completion of the contract, subject only to the Limitation of Government Liability clause.</P>
                                <P>(1) After the Contracting Officer's determination of price or fee, the contract shall be governed by—</P>
                                <P>(i) All clauses required by the FAR on the date of execution of this undefinitized contract action for either fixed-price or cost-reimbursement contracts, as determined by the Contracting Officer under this paragraph (d);</P>
                                <P>(ii) All clauses required by law as of the date of the Contracting Officer's determination; and</P>
                                <P>(iii) Any other clauses, terms, and conditions mutually agreed upon.</P>
                                <P>(2) To the extent consistent with paragraph (d)(1) of this clause, all clauses, terms, and conditions included in this undefinitized contract action shall continue in effect, except those that by their nature apply only to an undefinitized contract action.</P>
                                <P>
                                    (e) The definitive contract resulting from this undefinitized contract action will include a negotiated___ 
                                    <E T="03">[insert “cost/price ceiling” or “firm-fixed price”]</E>
                                     in no event to exceed__
                                    <E T="03">[insert the not-to-exceed amount].</E>
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[88 FR 33838, May 25, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.217-7028</SECTNO>
                            <SUBJECT>Over and above work.</SUBJECT>
                            <P>As prescribed in 217.7702, use a clause substantially as follows:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Over and Above Work (DEC 1991)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    (1) 
                                    <E T="03">Over and above work</E>
                                     means work discovered during the course of performing overhaul, maintenance, and repair efforts that is—
                                </P>
                                <P>(i) Within the general scope of the contract;</P>
                                <P>(ii) Not covered by the line item(s) for the basic work under the contract; and</P>
                                <P>(iii) Necessary in order to satisfactorily complete the contract.</P>
                                <P>
                                    (2) 
                                    <E T="03">Work request</E>
                                     means a document prepared by the Contractor which describes over and above work being proposed.
                                </P>
                                <P>(b) The Contractor and Administrative Contracting Officer shall mutually agree to procedures for Government administration and Contractor performance of over and above work requests. If the parties cannot agree upon the procedures, the Administrative Contracting Officer has the unilateral right to direct the over and above work procedures to be followed. These procedures shall, as a minimum, cover—</P>
                                <P>(1) The format, content, and submission of work requests by the Contractor. Work requests shall contain data on the type of discrepancy disclosed, the specific location of the discrepancy, and the estimated labor hours and material required to correct the discrepancy. Data shall be sufficient to satisfy contract requirements and obtain the authorization of the Contracting Officer to perform the proposed work;</P>
                                <P>(2) Government review, verification, and authorization of the work; and</P>
                                <P>(3) Proposal pricing, submission, negotiation, and definitization.</P>
                                <P>(c) Upon discovery of the need for over and above work, the Contractor shall prepare and furnish to the Government a work request in accordance with the agreed-to procedures.</P>
                                <P>(d) The Government shall—</P>
                                <P>(1) Promptly review the work request;</P>
                                <P>(2) Verify that the proposed work is required and not covered under the basic contract line item(s);</P>
                                <P>(3) Verify that the proposed corrective action is appropriate; and</P>
                                <P>(4) Authorize over and above work as necessary.</P>
                                <P>(e) The Contractor shall promptly submit to the Contracting Officer, a proposal for the over and above work. The Government and Contractor will then negotiate a settlement for the over and above work. Contract modifications will be executed to definitize all over and above work.</P>
                                <P>(f) Failure to agree on the price of over and above work shall be a dispute within the meaning of the Disputes clause of this contract.</P>
                            </EXTRACT>
                            <PRTPAGE P="495"/>
                            <HD SOURCE="HD3">(End of clause)</HD>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.219-7000</SECTNO>
                            <SUBJECT>Advancing Small Business Growth.</SUBJECT>
                            <P>As prescribed in 219.309(1), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Advancing Small Business Growth (JUN 2023)</HD>
                                <P>(a) This provision implements 10 U.S.C. 4959.</P>
                                <P>
                                    (b) The Offeror acknowledges by submission of its offer that by acceptance of the contract resulting from this solicitation, the Offeror may exceed the applicable small business size standard of the North American Industry Classification System (NAICS) code assigned to the contract and would no longer qualify as a small business concern for that NAICS code. Small business size standards matched to industry NAICS codes are published by the Small Business Administration and are available at 13 CFR 121.201 and 
                                    <E T="03">https://www.sba.gov/document/support-table-size-standards.</E>
                                     The Offeror is therefore encouraged to develop the capabilities and characteristics typically desired in contractors that are competitive as other-than-small contractors in this industry.
                                </P>
                                <P>
                                    (c) For procurement technical assistance, the Offeror may contact the nearest APEX Accelerator. APEX Accelerator locations are available at 
                                    <E T="03">https://www.apexaccelerators.us.</E>
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[80 FR 30116, May 26, 2015, as amended at 81 FR 65563, Sept. 23, 2016; 87 FR 76997, Dec. 16, 2022; 88 FR 37799, June 9, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.219-7001—252.219-7002</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.219-7003</SECTNO>
                            <SUBJECT>Small Business Subcontracting Plan (DoD Contracts).</SUBJECT>
                            <P>
                                <E T="03">Basic.</E>
                                 As prescribed in 219.708(b)(1)(A) and (b)(1)(A)(
                                <E T="03">1</E>
                                ), use the following clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Small Business Subcontracting Plan (DoD Contracts)—BASIC (DEC 2019)</HD>
                                <P>This clause supplements the Federal Acquisition Regulation 52.219-9, Small Business Subcontracting Plan, clause of this contract.</P>
                                <P>
                                    (a) 
                                    <E T="03">Definition.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Summary Subcontract Report (SSR) Coordinator</E>
                                     means the individual who is registered in the Electronic Subcontracting Reporting System (eSRS) at the Department of Defense level and is responsible for acknowledging receipt or rejecting SSRs submitted under an individual subcontracting plan in eSRS for the Department of Defense.
                                </P>
                                <P>(b) Subcontracts awarded to qualified nonprofit agencies designated by the Committee for Purchase From People Who Are Blind or Severely Disabled (41 U.S.C. 8502-8504), may be counted toward the Contractor's small business subcontracting goal (section 8025 of Pub. L. 108-87).</P>
                                <P>(c) A mentor firm, under the Pilot Mentor-Protégé Program established under section 831 of Public Law 101-510, as amended, may count toward its small disadvantaged business goal, subcontracts awarded to—</P>
                                <P>(1) Protégé firms which are qualified organizations employing the severely disabled; and</P>
                                <P>(2) Former protégé firms that meet the criteria in section 831(g)(4) of Public Law 101-510.</P>
                                <P>(d) The master plan is approved by the cognizant contract administration activity for the Contractor.</P>
                                <P>(e) In those subcontracting plans which specifically identify small businesses, the Contractor shall notify the Administrative Contracting Officer of any substitutions of firms that are not small business firms, for the small business firms specifically identified in the subcontracting plan. Notifications shall be in writing and shall occur within a reasonable period of time after award of the subcontract. Contractor-specified formats shall be acceptable.</P>
                                <P>(f)(1) For DoD, the Contractor shall submit reports in eSRS as follows:</P>
                                <P>(i) The Individual Subcontract Report (ISR) shall be submitted to the contracting officer at the procuring contracting office, even when contract administration has been delegated to the Defense Contract Management Agency.</P>
                                <P>(ii) Submit the consolidated SSR for an individual subcontracting plan to the “Department of Defense.”</P>
                                <P>(2) For DoD, the authority to acknowledge receipt or reject reports in eSRS is as follows:</P>
                                <P>(i) The authority to acknowledge receipt or reject the ISR resides with the contracting officer who receives it, as described in paragraph (f)(1)(i) of this clause.</P>
                                <P>(ii) The authority to acknowledge receipt of or reject SSRs submitted under an individual subcontracting plan resides with the SSR Coordinator.</P>
                                <P>(g) Include the clause at Defense Federal Acquisition Regulation Supplement (DFARS) 252.219-7004, Small Business Subcontracting Plan (Test Program), in subcontracts with subcontractors that participate in the Test Program described in DFARS 219.702-70, if the subcontract is expected to exceed the applicable threshold specified in Federal Acquisition Regulation 19.702(a), and to have further subcontracting opportunities.</P>
                            </EXTRACT>
                            <PRTPAGE P="496"/>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <HD SOURCE="HD1">Alternate I.</HD>
                            <P>
                                <E T="03">Alternate I.</E>
                                 As prescribed in 219.708(b)(1)(A) and (b)(1)(A)(
                                <E T="03">2</E>
                                ), use the following clause, which uses a different paragraph (f) than the basic clause.
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Small Business Subcontracting Plan (DoD Contracts)—Alternate I (DEC 2019)</HD>
                                <P>This clause supplements the Federal Acquisition Regulation 52.219-9, Small Business Subcontracting Plan, clause of this contract.</P>
                                <P>
                                    (a) 
                                    <E T="03">Definition.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Summary Subcontract Report (SSR) Coordinator</E>
                                     means the individual who is registered in the Electronic Subcontracting Reporting System (eSRS) at the Department of Defense level and is responsible for acknowledging receipt or rejecting SSRs submitted under an individual subcontracting plan in eSRS for the Department of Defense.
                                </P>
                                <P>(b) Subcontracts awarded to qualified nonprofit agencies designated by the Committee for Purchase From People Who Are Blind or Severely Disabled (41 U.S.C. 8502-8504), may be counted toward the Contractor's small business subcontracting goal (section 8025 of Pub. L. 108-87).</P>
                                <P>(c) A mentor firm, under the Pilot Mentor-Protege Program established under section 831 of Public Law 101-510, as amended, may count toward its small disadvantaged business goal, subcontracts awarded to—</P>
                                <P>(1) Protege firms which are qualified organizations employing the severely disabled; and</P>
                                <P>(2) Former protege firms that meet the criteria in section 831(g)(4) of Public Law 101-510.</P>
                                <P>(d) The master plan is approved by the cognizant contract administration activity for the Contractor.</P>
                                <P>(e) In those subcontracting plans which specifically identify small businesses, the Contractor shall notify the Administrative Contracting Officer of any substitutions of firms that are not small business firms, for the small business firms specifically identified in the subcontracting plan. Notifications shall be in writing and shall occur within a reasonable period of time after award of the subcontract. Contractor-specified formats shall be acceptable.</P>
                                <P>(f)(1) For DoD, the Contractor shall submit reports in eSRS as follows:</P>
                                <P>(i) The Standard Form 294, Subcontracting Report for Individual Contracts, shall be submitted in accordance with the instructions on that form.</P>
                                <P>(ii) Submit the consolidated SSR to the “Department of Defense.”</P>
                                <P>(2) For DoD, the authority to acknowledge receipt of or reject SSRs submitted under an individual subcontracting plan in eSRS resides with the SSR Coordinator.</P>
                                <P>(g) Include the clause at Defense Federal Acquisition Regulation Supplement (DFARS) 252.219-7004, Small Business Subcontracting Plan (Test Program), in subcontracts with subcontractors that participate in the Test Program described in DFARS 219.702-70, if the subcontract is expected to exceed the applicable threshold specified in Federal Acquisition Regulation 19.702(a), and to have further subcontracting opportunities.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate II.</E>
                                 As prescribed in 219.708(b)(1)(A) and (b)(1)(A)(
                                <E T="03">3</E>
                                ), use the following clause, which uses different paragraphs (a) and (b) than the basic clause.
                            </P>
                            <HD SOURCE="HD3">Small Business Subcontracting Plan (DoD Contracts)—Alternate II (DEC 2019)</HD>
                            <EXTRACT>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Eligible contractor</E>
                                     means a business entity operated on a for-profit or nonprofit basis that—
                                </P>
                                <P>(1) Employs severely disabled individuals at a rate that averages not less than 33 percent of its total workforce over the 12-month period prior to issuance of the solicitation;</P>
                                <P>(2) Pays not less than the minimum wage prescribed pursuant to 29 U.S.C. 206 to the employees who are severely disabled individuals; and</P>
                                <P>(3) Provides, for its employees, health insurance and a retirement plan comparable to those provided for employees by business entities of similar size in its industrial sector or geographic region.</P>
                                <P>
                                    <E T="03">Summary Subcontract Report (SSR) Coordinator</E>
                                     means the individual who is registered in the Electronic Subcontracting Reporting System (eSRS) at the Department of Defense level and is responsible for acknowledging receipt or rejecting SSRs submitted under an individual subcontracting plan in eSRS for the Department of Defense.
                                </P>
                                <P>(b)(1) Subcontracts awarded to qualified nonprofit agencies designated by the Committee for Purchase From People Who are Blind or Severely Disabled (41 U.S.C. 8502-8504), may be counted toward the Contractor's small business subcontracting goal (section 8025 of Pub. L. 108-87).</P>
                                <P>
                                    (2) Subcontracts awarded to eligible contractors under the Demonstration Project for Contractors Employing Persons with Disabilities (see Defense Federal Acquisition Regulation Supplement (DFARS) 226.72) may be counted toward the Contractor's small disadvantaged business subcontracting goal (section 853 of Pub. L. 108-136, as amended by division H, section 110 of Pub. L. 108-199).
                                    <PRTPAGE P="497"/>
                                </P>
                                <P>(c) A mentor firm, under the Pilot Mentor-Protege Program established under section 831 of Public Law 101-510, may count toward its small disadvantaged business goal, subcontracts awarded to—</P>
                                <P>(1) Protege firms which are qualified organizations employing the severely disabled; and</P>
                                <P>(2) Former protege firms that meet the criteria in section 831(g)(4) of Public Law 101-510.</P>
                                <P>(d) The master plan is approved by the cognizant contract administration activity for the Contractor.</P>
                                <P>(e) In those subcontracting plans which specifically identify small businesses, the Contractor shall notify the Administrative Contracting Officer of any substitutions of firms that are not small business firms, for the small business firms specifically identified in the subcontracting plan. Notifications shall be in writing and shall occur within a reasonable period of time after award of the subcontract. Contractor-specified formats shall be acceptable.</P>
                                <P>(f)(1) For DoD, the Contractor shall submit reports in eSRS as follows:</P>
                                <P>(i) The Individual Subcontract Report (ISR) shall be submitted to the contracting officer at the procuring contracting office, even when contract administration has been delegated to the Defense Contract Management Agency.</P>
                                <P>(ii) Submit the consolidated SSR for an individual subcontracting plan to the “Department of Defense.”</P>
                                <P>(2) For DoD, the authority to acknowledge receipt or reject reports in eSRS is as follows:</P>
                                <P>(i) The authority to acknowledge receipt or reject the ISR resides with the contracting officer who receives it, as described in paragraph (f)(1)(i) of this clause.</P>
                                <P>(ii) The authority to acknowledge receipt of or reject SSRs submitted under an individual subcontracting plan resides with the SSR Coordinator.</P>
                                <P>(g) Include the clause at DFARS 252.219-7004, Small Business Subcontracting Plan (Test Program), in subcontracts with subcontractors that participate in the Test Program described in DFARS 219.702-70, if the subcontract is expected to exceed the applicable threshold specified in Federal Acquisition Regulation 19.702(a) and to have further subcontracting opportunities.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <EXTRACT>
                                <P>(f)(1)(i) The Standard Form 294 Subcontracting Report for Individual Contracts shall be submitted in accordance with the instructions on that form; paragraph (f)(2)(i) is inapplicable.</P>
                            </EXTRACT>
                            <CITA>[75 FR 65440, Oct. 25, 2010, as amended at 76 FR 58138, Sept. 20, 2011; 77 FR 35882, June 15, 2012; 77 FR 52254, Aug. 29, 2012; 79 FR 61582, Oct. 14, 2014; 81 FR 17046, Mar. 25, 2016; 83 FR 15999, Apr. 13, 2018; 83 FR 65564, Dec. 21, 2018; 84 FR 25187, May 31, 2019; 84 FR 72560, Dec. 31, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.219-7004</SECTNO>
                            <SUBJECT>Small Business Subcontracting Plan (Test Program).</SUBJECT>
                            <P>As prescribed in 219.708(b)(1)(B), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Small Business Subcontracting Plan (Test Program) (DEC 2022)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Covered small business concern</E>
                                     means a small business concern, veteran-owned small business concern, service-disabled veteran-owned small business concern, HUBZone small business concern, women-owned small business concern, or small disadvantaged business concern, as these terms are defined in FAR 2.101.
                                </P>
                                <P>
                                    <E T="03">Electronic Subcontracting Reporting System (eSRS)</E>
                                     means the Governmentwide, electronic, web-based system for small business subcontracting program reporting. The eSRS is located at 
                                    <E T="03">http://www.esrs.gov</E>
                                    .
                                </P>
                                <P>
                                    <E T="03">Failure to make a good faith effort to comply with a comprehensive subcontracting plan</E>
                                     means a willful or intentional failure to perform in accordance with the requirements of the Contractor's approved comprehensive subcontracting plan or willful or intentional action to frustrate the plan.
                                </P>
                                <P>
                                    <E T="03">Subcontract</E>
                                     means any agreement (other than one involving an employer-employee relationship) entered into by a Federal Government prime Contractor or subcontractor calling for supplies or services required for performance of the contract or subcontract.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Test Program.</E>
                                     The Contractor's comprehensive small business subcontracting plan and its successors, which are authorized by and approved under the Test Program of 15 U.S.C. 637 note, as amended, shall be included in and made a part of this contract. Upon expulsion from the Test Program or expiration of the Test Program, the Contractor shall negotiate an individual subcontracting plan for all future contracts that meet the requirements of 15 U.S.C. 637(d).
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Eligibility requirements.</E>
                                     To become and remain eligible to participate in the Test Program, a business concern is required to have furnished supplies or services (including construction) under at least three DoD contracts during the preceding fiscal year, having an aggregate value of at least $100 million.
                                </P>
                                <P>
                                    (d) 
                                    <E T="03">Reports.</E>
                                     (1) The Contractor shall report semiannually for the 6-month periods ending 
                                    <PRTPAGE P="498"/>
                                    March 31 and September 30, the information in paragraphs (d)(1)(i) through (v) of this section within 30 days after the end of the reporting period. Submit the report at 
                                    <E T="03">https://www.esrs.gov</E>
                                    .
                                </P>
                                <P>(i) A list of contracts covered under its comprehensive small business subcontracting plan, to include the Commercial and Government Entity (CAGE) code and unique entity identifier.</P>
                                <P>(ii) The amount of first-tier subcontract dollars awarded during the 6-month period covered by the report to covered small business concerns, with the information set forth separately by—</P>
                                <P>(A) North American Industrial Classification System (NAICS) code;</P>
                                <P>(B) Major defense acquisition program, as defined in 10 U.S.C. 4201;</P>
                                <P>(C) Contract number, if the contract is for maintenance, overhaul, repair, servicing, rehabilitation, salvage, modernization, or modification of supplies, systems, or equipment, and the total value of the contract, including options, exceeds $100 million; and</P>
                                <P>(D) Military department.</P>
                                <P>(iii) Total number of subcontracts active under the Test Program that would have otherwise required a subcontracting plan.</P>
                                <P>(iv) Costs incurred in negotiating, complying with, and reporting on its comprehensive subcontracting plan.</P>
                                <P>(v) Costs avoided through the use of a comprehensive subcontracting plan.</P>
                                <P>(2) The Contractor shall—</P>
                                <P>(i) Ensure that subcontractors with subcontracting plans agree to submit an Individual Subcontract Report (ISR) and/or Summary Subcontract Report (SSR) using the Electronic Subcontracting Reporting System (eSRS).</P>
                                <P>(ii) Provide its contract number, its unique entity identifier, and the email address of the Contractor's official responsible for acknowledging or rejecting the ISR to all first-tier subcontractors, who will be required to submit ISRs, so they can enter this information into the eSRS when submitting their reports.</P>
                                <P>(iii) Require that each subcontractor with a subcontracting plan provide the prime contract number, its own unique entity identifier, and the email address of the subcontractor's official responsible for acknowledging or rejecting the ISRs to its subcontractors with subcontracting plans who will be required to submit ISRs.</P>
                                <P>(iv) Acknowledge receipt or reject all ISRs submitted by its subcontractors using eSRS.</P>
                                <P>
                                    (3) The Contractor shall submit SSRs using eSRS at 
                                    <E T="03">http://www.esrs.gov</E>
                                    . The reports shall provide information on subcontract awards to small business concerns, veteran-owned small business concerns, service-disabled veteran-owned small business concerns, HUBZone small business concerns, small disadvantaged business concerns, and women-owned small business concerns. Purchases from a corporation, company, or subdivision that is an affiliate of the prime Contractor or subcontractor are not included in these reports. Subcontract award data reported by prime contractors and subcontractors shall be limited to awards made to their immediate next-tier subcontractors. Credit cannot be taken for awards made to lower-tier subcontractors unless the Contractor or subcontractor has been designated to receive a small business or small disadvantaged business credit from a member firm of the Alaska Native—Corporations or an Indian tribe. Only subcontracts involving performance in the U.S. or its outlying areas should be included in these reports.
                                </P>
                                <P>(i) This report may be submitted on a corporate, company, or subdivision (e.g., plant or division operating as a separate profit center) basis, as negotiated in the comprehensive subcontracting plan with the Defense Contract Management Agency.</P>
                                <P>(ii) This report encompasses all subcontracting under prime contracts and subcontracts with the Department of Defense, regardless of the dollar value of the subcontracts, and is based on the negotiated comprehensive subcontracting plan.</P>
                                <P>(iii) The report shall be submitted semiannually for the six months ending March 31 and the twelve months ending September 30. Reports are due 30 days after the close of each reporting period.</P>
                                <P>(iv) The authority to acknowledge receipt of or reject the SSR resides with the Defense Contract Management Agency.</P>
                                <P>
                                    (e) 
                                    <E T="03">Failure to comply.</E>
                                     The failure of the Contractor or subcontractor to comply in good faith with the clause of this contract entitled “Utilization of Small Business Concerns,” or an approved plan required by this clause, shall be a material breach of the contract.
                                </P>
                                <P>
                                    (f) 
                                    <E T="03">Liquidated damages.</E>
                                     The Contracting Officer designated to manage the comprehensive subcontracting plan will exercise the functions of the Contracting Officer, as identified in paragraphs (f)(1) through (4) of this clause, on behalf of all DoD departments and agencies that awarded contracts covered by the Contractor's comprehensive subcontracting plan.
                                </P>
                                <P>(1) To determine the need for liquidated damages, the Contracting Officer will conduct a compliance review during the fiscal year after the close of the fiscal year for which the plan is applicable. The Contracting Officer will compare the approved percentage or dollar goals to the total, actual subcontracting dollars covered by the plan.</P>
                                <P>
                                    (2) If the Contractor has failed to meet its approved subcontracting goal(s), the Contracting Officer will provide the Contractor 
                                    <PRTPAGE P="499"/>
                                    written notice specifying the failure, advising of the potential for assessment of liquidated damages, and permitting the Contractor to demonstrate what good faith efforts have been made. The Contracting Officer may take the Contractor's failure to respond to the notice within 15 working days (or longer period at the Contracting Officer's discretion) as an admission that no valid explanation exists.
                                </P>
                                <P>(3) If, after consideration of all relevant information, the Contracting Officer determines that the Contractor failed to make a good faith effort to comply with the comprehensive subcontracting plan, the Contracting Officer will issue a final decision to the Contractor to that effect and require the Contractor to pay liquidated damages to the Government in the amount identified in the comprehensive subcontracting plan.</P>
                                <P>(4) The Contractor shall have the right of appeal under the clause in this contract entitled “Disputes” from any final decision of the Contracting Officer.</P>
                                <P>
                                    (g) 
                                    <E T="03">Subcontracts.</E>
                                     The Contractor shall include in subcontracts that offer subcontracting opportunities, are expected to exceed the applicable threshold specified in FAR 19.702(a) on the date of subcontract award, and are required to include the clause at FAR 52.219-8, Utilization of Small Business Concerns, the clauses at—
                                </P>
                                <P>(1) FAR 52.219-9, Small Business Subcontracting Plan, and Defense Federal Acquisition Regulation Supplement (DFARS) 252.219-7003, Small Business Subcontracting Plan (DoD Contracts)—Basic;</P>
                                <P>(2) FAR 52.219-9, Small Business Subcontracting Plan, with its Alternate III, and DFARS 252.219-7003, Small Business Subcontracting Plan (DoD Contracts)—Alternate I, to allow for submission of SF 294s in lieu of ISRs; or</P>
                                <P>(3) DFARS 252.219-7004, Small Business Subcontracting Plan (Test Program), in subcontracts with subcontractors that participate in the Test Program described in DFARS 219.702-70.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[83 FR 15999, Apr. 13, 2018, as amended at 84 FR 25188, May 31, 2019; 87 FR 76997, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.219-7005—252.219-7008</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.219-7009</SECTNO>
                            <SUBJECT>Section 8(a) direct award.</SUBJECT>
                            <P>As prescribed in 219.811-3(1), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">
                                    Section 8(
                                    <E T="01">a</E>
                                    ) Direct Award (OCT 2018)
                                </HD>
                                <P>(a) This contract is issued as a direct award between the contracting office and the 8(a) Contractor pursuant to the Partnership Agreement between the Small Business Administration (SBA) and the Department of Defense. Accordingly, the SBA, even if not identified in Section A of this contract, is the prime contractor and retains responsibility for 8(a) certification, for 8(a) eligibility determinations and related issues, and for providing counseling and assistance to the 8(a) Contractor under the 8(a) Program. The cognizant SBA district office is:</P>
                                <FP SOURCE="FP-DASH"/>
                                <FP SOURCE="FP-DASH"/>
                                <FP SOURCE="FP-DASH"/>
                                <FP SOURCE="FP-DASH"/>
                                <FP>
                                    [
                                    <E T="03">To be completed by the Contracting Officer at the time of award</E>
                                    ]
                                </FP>
                                <P>(b) The contracting office is responsible for administering the contract and for taking any action on behalf of the Government under the terms and conditions of the contract; provided that the contracting office shall give advance notice to the SBA before it issues a final notice terminating performance, either in whole or in part, under the contract. The contracting office also shall coordinate with the SBA prior to processing any novation agreement. The contracting office may assign contract administration functions to a contract administration office.</P>
                                <P>(c) The 8(a) Contractor agrees that it will notify the Contracting Officer, simultaneous with its notification to the SBA (as required by SBA's 8(a) regulations at 13 CFR 124.515), when the owner or owners upon whom 8(a) eligibility is based plan to relinquish ownership or control of the concern. Consistent with section 407 of Public Law 100-656, transfer of ownership or control shall result in termination of the contract for convenience, unless the SBA waives the requirement for termination prior to the actual relinquishing of ownership and control.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[63 FR 33588, June 19, 1998, as amended at 67 FR 11437, Mar. 14, 2002; 72 FR 51188, Sept. 6, 2007; 83 FR 54682, Oct. 31, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.219-7010</SECTNO>
                            <SUBJECT>Notification of Competition Limited to Eligible 8(a) Participants—Partnership Agreement</SUBJECT>
                            <P>As prescribed in 219.811-3(2), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Notification of Competition Limited to Eligible 8(A) Participants—Partnership Agreement (OCT 2019)</HD>
                                <P>
                                    (a) Offers are solicited only from small business concerns expressly certified by the Small Business Administration (SBA) for participation in SBA's 8(a) Program and 
                                    <PRTPAGE P="500"/>
                                    which meet the following criteria at the time of submission of offer:
                                </P>
                                <P>(1) The Offeror is in conformance with the 8(a) support limitation set forth in its approved business plan.</P>
                                <P>(2) The Offeror is in conformance with the Business Activity Targets set forth in its approved business plan or any remedial action directed by SBA.</P>
                                <P>
                                    (3) If the competition is to be limited to 8(a) concerns within one or more specific SBA regions or districts, then the offeror's approved business plan is on the file and serviced by ________. 
                                    <E T="03">[Contracting Officer completes by inserting the appropriate SBA District and/or Regional Office(s) as identified by SBA.]</E>
                                </P>
                                <P>(b) By submission of its offer, the Offeror represents that it meets all of the criteria set forth in paragraph (a) of this clause.</P>
                                <P>(c) Any award resulting from this solicitation will be made directly by the Contracting Officer to the successful 8(a) offeror selected through the evaluation criteria set forth in this solicitation.</P>
                                <P>(d)(1) Unless SBA has waived the requirements of paragraphs (d)(1)(i) through (iii) and (d)(2) of this clause in accordance with 13 CFR 121.1204, a small business concern that provides an end item it did not manufacture, process, or produce, shall—</P>
                                <P>(i) Provide an end item that a small business has manufactured, processed, or produced in the United States or its outlying areas; for kit assemblers, see paragraph (d)(2) of this clause instead;</P>
                                <P>(ii) Be primarily engaged in the retail or wholesale trade and normally sell the type of item being supplied; and</P>
                                <P>(iii) Take ownership or possession of the item(s) with its personnel, equipment, or facilities in a manner consistent with industry practice; for example, providing storage, transportation, or delivery.</P>
                                <P>(2) When the end item being acquired is a kit of supplies, at least 50 percent of the total cost of the components of the kit shall be manufactured, processed, or produced by small businesses in the United States or its outlying areas.</P>
                                <P>(3) The requirements of paragraphs (d)(1)(i) through (iii) and (d)(2) of this clause do not apply to construction or service contracts.</P>
                                <P>
                                    (e) The ________ 
                                    <E T="03">[insert name of SBA's contractor]</E>
                                     will notify the ________ 
                                    <E T="03">[insert name of contracting agency]</E>
                                     Contracting Officer in writing immediately upon entering an agreement (either oral or written) to transfer all or part of its stock or other ownership interest to any other party.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[81 FR 17047, Mar. 25, 2016, as amended at 84 FR 58336, Oct. 31, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.219-7011</SECTNO>
                            <SUBJECT>Notification to delay performance.</SUBJECT>
                            <P>As prescribed in 219.811-3 (3), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Notification To Delay Performance (JUN 1998)</HD>
                                <P>The Contractor shall not begin performance under this purchase order until 2 working days have passed from the date of its receipt. Unless the Contractor receives notification from the Small Business Administration that it is ineligible for this 8(a) award, or otherwise receives instructions from the Contracting Officer, performance under this purchase order may begin on the third working day following receipt of the purchase order. If a determination of ineligibility is issued within the 2-day period, the purchase order shall be considered canceled.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[63 FR 33588, June 19, 1998]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.219-7012</SECTNO>
                            <SUBJECT>Competition for Religious-Related Services.</SUBJECT>
                            <P>As prescribed in 219.270-3, use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Competition for Religious-Related Services (APR 2018)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition.</E>
                                     As used in this provision—
                                </P>
                                <P>
                                    <E T="03">Nonprofit organization</E>
                                     means any organization that is—
                                </P>
                                <P>(1) Described in section 501(c) of the Internal Revenue Code of 1986; and</P>
                                <P>(2) Exempt from tax under section 501(a) of that Code.</P>
                                <P>(b) A nonprofit organization is not precluded from competing for a contract for religious-related services to be performed on a U.S. military installation notwithstanding that a nonprofit organization is not a small business concern as identified in FAR 19.000(a)(3).</P>
                                <P>(c) If the apparently successful offeror has not represented in its offer or quotation that it is a small business concern identified in FAR 19.000(a)(3), as appropriate to the solicitation, the Contracting Officer will verify that the offeror is registered in the System for Award Management (SAM) database as a nonprofit organization.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[83 FR 16003, Apr. 13, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.222-7000</SECTNO>
                            <SUBJECT>Restrictions on employment of personnel.</SUBJECT>
                            <P>As prescribed in 222.7004, use the following clause:</P>
                            <EXTRACT>
                                <PRTPAGE P="501"/>
                                <HD SOURCE="HD1">Restrictions on Employment of Personnel (MAR 2000)</HD>
                                <P>(a) The Contractor shall employ, for the purpose of performing that portion of the contract work in ________, individuals who are residents thereof and who, in the case of any craft or trade, possess or would be able to acquire promptly the necessary skills to perform the contract.</P>
                                <P>(b) The Contractor shall insert the substance of this clause, including this paragraph (b), in each subcontract awarded under this contract.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[65 FR 14403, Mar. 16, 2000]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.222-7001</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.222-7002</SECTNO>
                            <SUBJECT>Compliance with local labor laws (overseas).</SUBJECT>
                            <P>As prescribed in 222.7201(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Compliance With Local Labor Laws (Overseas) (JUN 1997)</HD>
                                <P>(a) The Contractor shall comply with all—</P>
                                <P>(1) Local laws, regulations, and labor union agreements governing work hours; and</P>
                                <P>(2) Labor regulations including collective bargaining agreements, workers' compensation, working conditions, fringe benefits, and labor standards or labor contract matters.</P>
                                <P>(b) The Contractor indemnifies and holds harmless the United States Government from all claims arising out of the requirements of this clause. This indemnity includes the Contractor's obligation to handle and settle, without cost to the United States Government, any claims or litigation concerning allegations that the Contractor or the United States Government, or both, have not fully complied with local labor laws or regulations relating to the performance of work required by this contract.</P>
                                <P>(c) Notwithstanding paragraph (b) of this clause, consistent with paragraphs 31.205-15(a) and 31.205-47(d) of the Federal Acquisition Regulation, the Contractor will be reimbursed for the costs of all fines, penalties, and reasonable litigation expenses incurred as a result of compliance with specific contract terms and conditions or written instructions from the Contracting officer.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[62 FR 34129, June 24, 1997]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.222-7003</SECTNO>
                            <SUBJECT>Permit from Italian Inspectorate of Labor.</SUBJECT>
                            <P>As prescribed in 222.7201(b), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Permit From Italian Inspectorate of Labor (JUN 1997)</HD>
                                <P>Prior to the date set for commencement of work and services under this contract, the Contractor shall obtain the prescribed permit from the Inspectorate of Labor having jurisdiction over the work site, in accordance with Article 5g of Italian Law Number 1369, dated October 23, 1960. The Contractor shall ensure that a copy of the permit is available at all reasonable times for inspection by the Contracting Officer or an authorized representative. Failure to obtain such permit may result in termination of the contract for the convenience of the United States Government, at no cost to the United States Government.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[62 FR 34129, June 24, 1997]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.222-7004</SECTNO>
                            <SUBJECT>Compliance with Spanish social security laws and regulations.</SUBJECT>
                            <P>As prescribed in 222.7201(c), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Compliance with Spanish Social Security Laws and Regulations (JUN 1997)</HD>
                                <P>(a) The Contractor shall comply with all Spanish Government social security laws and regulations. Within 30 calendar days after the start of contract performance, the Contractor shall ensure that copies of the documents identified in paragraph (a)(1) through (a)(5) of this clause are available at all reasonable times for inspection by the Contracting Officer or an authorized representative. The Contractor shall retain the records in accordance with the Audit and Records clause of this contract.</P>
                                <P>(1) TC1—Certificate of Social Security Payments;</P>
                                <P>(2) TC2—List of Employees;</P>
                                <P>(3) TC2/1—Certificate of Social Security Payments for Trainees;</P>
                                <P>(4) Nominal (pay statements) signed by both the employee and the Contractor; and</P>
                                <P>(5) Informa de Situacion de Empressa (Report of the Condition of the Enterprise) from the Ministerio de Trabajo y S.S., Tesoreria General de la Seguridad Social (annotated with the pertinent contract number(s) next to the employee's name).</P>
                                <P>(b) All TC1's, TC2's, and TC2/1's shall contain a representation that they have been paid by either the Social Security Administration office or the Contractor's bank or savings institution. Failure by the Contractor to comply with the requirements of this clause may result in termination of the contract under the clause of the contract entitled “Default.”</P>
                            </EXTRACT>
                            <PRTPAGE P="502"/>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[62 FR 34129, June 24, 1997]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.222-7005</SECTNO>
                            <SUBJECT>Prohibition on use of nonimmigrant aliens—Guam.</SUBJECT>
                            <P>As prescribed in 222.7302, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Prohibition on Use of Nonimmigrant Aliens—Guam (SEP 1999)</HD>
                                <P>The work required by this contract shall not be performed by any alien who is issued a visa or otherwise provided nonimmigrant status under Section 101(a)(15)(H)(ii) of the Immigration and Nationality Act (8 U.S.C. 1101(a)(15)(H)(ii)). This prohibition does not apply to the performance of work by lawfully admitted citizens of the freely associated states of the Republic of the Marshall Islands, the Federated States of Micronesia, or the Republic of Palau.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[64 FR 52673, Sept. 30, 1999, as amended at 72 FR 20764, Apr. 26, 2007]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.222-7006</SECTNO>
                            <SUBJECT>Restrictions on the Use of Mandatory Arbitration Agreements.</SUBJECT>
                            <P>As prescribed in 222.7405, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Restrictions on the Use of Mandatory Arbitration Agreements (JAN 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Covered subcontractor</E>
                                     means any entity that has a subcontract valued in excess of $1 million, except a subcontract for the acquisition of commercial products or commercial services, including commercially available off-the-shelf items.
                                </P>
                                <P>
                                    <E T="03">Subcontract</E>
                                     means any contract, as defined in Federal Acquisition Regulation subpart 2.1, to furnish supplies or services for performance of this contract or a higher-tier subcontract thereunder.
                                </P>
                                <P>(b) The Contractor—</P>
                                <P>(1) Agrees not to—</P>
                                <P>(i) Enter into any agreement with any of its employees or independent contractors that requires, as a condition of employment, that the employee or independent contractor agree to resolve through arbitration—</P>
                                <P>(A) Any claim under title VII of the Civil Rights Act of 1964; or</P>
                                <P>(B) Any tort related to or arising out of sexual assault or harassment, including assault and battery, intentional infliction of emotional distress, false imprisonment, or negligent hiring, supervision, or retention; or</P>
                                <P>(ii) Take any action to enforce any provision of an existing agreement with an employee or independent contractor that mandates that the employee or independent contractor resolve through arbitration—</P>
                                <P>(A) Any claim under title VII of the Civil Rights Act of 1964; or</P>
                                <P>(B) Any tort related to or arising out of sexual assault or harassment, including assault and battery, intentional infliction of emotional distress, false imprisonment, or negligent hiring, supervision, or retention; and</P>
                                <P>(2) Certifies, by signature of the contract, that it requires each covered subcontractor to agree not to enter into, and not to take any action to enforce, any provision of any existing agreements, as described in paragraph (b)(1) of this clause, with respect to any employee or independent contractor performing work related to such subcontract.</P>
                                <P>(c) The prohibitions of this clause do not apply with respect to a contractor's or subcontractor's agreements with employees or independent contractors that may not be enforced in a court of the United States.</P>
                                <P>(d) The Secretary of Defense may waive the applicability of the restrictions of paragraph (b) of this clause in accordance with Defense Federal Acquisition Regulation Supplement 222.7404.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[75 FR 27948, May 19, 2010, as amended at 75 FR 40717, July 13, 2010; 75 FR 76297, Dec. 8, 2010; 88 FR 6591, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.223-7000</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.223-7001</SECTNO>
                            <SUBJECT>Hazard warning labels.</SUBJECT>
                            <P>As prescribed in 223.304, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Hazard Warning Labels (DEC 1991)</HD>
                                <P>(a) “Hazardous material,” as used in this clause, is defined in the Hazardous Material Identification and Material Safety Data clause of this contract.</P>
                                <P>
                                    (b) The Contractor shall label the item package (unit container) of any hazardous material to be delivered under this contract in accordance with the Hazard Communication Standard (29 CFR 1910.1200 
                                    <E T="03">et seq</E>
                                    ). The Standard requires that the hazard warning label conform to the requirements of the standard unless the material is otherwise subject to the labelling requirements of one of the following statutes:
                                </P>
                                <P>(1) Federal Insecticide, Fungicide and Rodenticide Act;</P>
                                <P>(2) Federal Food, Drug and Cosmetics Act;</P>
                                <P>(3) Consumer Product Safety Act;</P>
                                <P>(4) Federal Hazardous Substances Act; or</P>
                                <P>
                                    (5) Federal Alcohol Administration Act.
                                    <PRTPAGE P="503"/>
                                </P>
                                <P>(c) The Offeror shall list which hazardous material listed in the Hazardous Material Identification and Material Safety Data clause of this contract will be labelled in accordance with one of the Acts in paragraphs (b) (1) through (5) of this clause instead of the Hazard Communication Standard. Any hazardous material not listed will be interpreted to mean that a label is required in accordance with the Hazard Communication Standard.</P>
                                <GPOTABLE COLS="2" OPTS="L2" CDEF="s10,r10">
                                    <BOXHD>
                                        <CHED H="1">Material (if none, insert “none.”)</CHED>
                                        <CHED H="1">Act</CHED>
                                    </BOXHD>
                                    <ROW>
                                        <ENT I="01" O="xl">________</ENT>
                                        <ENT>________</ENT>
                                    </ROW>
                                    <ROW>
                                        <ENT I="01" O="xl">________</ENT>
                                        <ENT>________</ENT>
                                    </ROW>
                                </GPOTABLE>
                                <P>(d) The apparently successful Offeror agrees to submit, before award, a copy of the hazard warning label for all hazardous materials not listed in paragraph (c) of this clause. The Offeror shall submit the label with the Material Safety Data Sheet being furnished under the Hazardous Material Identification and Material Safety Data clause of this contract.</P>
                                <P>(e) The Contractor shall also comply with MIL-STD-129, Marking for Shipment and Storage (including revisions adopted during the term of this contract).</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 89 FR 66284, Aug. 15, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.223-7002</SECTNO>
                            <SUBJECT>Safety Precautions for Ammunition and Explosives.</SUBJECT>
                            <P>As prescribed in 223.370-5, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Safety Precautions for Ammunition and Explosives (NOV 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition. Ammunition and explosives,</E>
                                     as used in this clause—
                                </P>
                                <P>(1) Means liquid and solid propellants and explosives, pyrotechnics, incendiaries and smokes in the following forms:</P>
                                <P>(i) Bulk,</P>
                                <P>(ii) Ammunition;</P>
                                <P>(iii) Rockets;</P>
                                <P>(iv) Missiles;</P>
                                <P>(v) Warheads;</P>
                                <P>(vi) Devices; and</P>
                                <P>(vii) Components of (i) through (vi), except for wholly inert items.</P>
                                <P>(2) This definition does not include the following, unless the Contractor is using or incorporating these materials for initiation, propulsion, or detonation as an integral or component part of an explosive, an ammunition or explosive end item, or of a weapon system—</P>
                                <P>(i) Inert components containing no explosives, propellants, or pyrotechnics;</P>
                                <P>(ii) Flammable liquids;</P>
                                <P>(iii) Acids;</P>
                                <P>(iv) Oxidizers;</P>
                                <P>(v) Powdered metals; or</P>
                                <P>(vi) Other materials having fire or explosive characteristics.</P>
                                <P>
                                    (b) 
                                    <E T="03">Safety requirements.</E>
                                     (1) The Contractor shall comply with the requirements of DoD Manual 4145.26, DoD Contractors' Safety Manual for Ammunition and Explosives, hereafter referred to as “the manual,” in effect on the date of the solicitation for this contract. The Contractor shall also comply with any other additional requirements included in the schedule of this contract.
                                </P>
                                <P>(2) The Contractor shall allow the Government access to the Contractor's facilities, personnel, and safety program documentation. The Contractor shall allow authorized Government representatives to evaluate safety programs, implementation, and facilities.</P>
                                <P>
                                    (c) 
                                    <E T="03">Noncompliance with the manual.</E>
                                     (1) If the Contracting Officer notifies the Contractor of any noncompliance with the manual or schedule provisions, the Contractor shall take immediate steps to correct the noncompliance. The Contractor is not entitled to reimbursement of costs incurred to correct noncompliances unless such reimbursement is specified elsewhere in the contract.
                                </P>
                                <P>(2) The Contractor has 30 days from the date of notification by the Contracting Officer to correct the noncompliance and inform the Contracting Officer of the actions taken. The Contracting Officer may direct a different time period for the correction of noncompliances.</P>
                                <P>(3) If the Contractor refuses or fails to correct noncompliances within the time period specified by the Contracting Officer, the Government has the right to direct the Contractor to cease performance on all or part of this contract. The Contractor shall not resume performance until the Contracting Officer is satisfied that the corrective action was effective and the Contracting Officer so informs the Contractor.</P>
                                <P>(4) The Contracting Officer may remove Government personnel at any time the Contractor is in noncompliance with any safety requirement of this clause.</P>
                                <P>(5) If the direction to cease work or the removal of Government personnel results in increased costs to the Contractor, the Contractor shall not be entitled to an adjustment in the contract price or a change in the delivery or performance schedule unless the Contracting Officer later determines that the Contractor had in fact complied with the manual or schedule provisions. If the Contractor is entitled to an equitable adjustment, it shall be made in accordance with the Changes clause of this contract.</P>
                                <P>
                                    (d) 
                                    <E T="03">Mishaps.</E>
                                     If a mishap involving ammunition or explosives occurs, the Contractor shall—
                                    <PRTPAGE P="504"/>
                                </P>
                                <P>(1) Notify the Contracting Officer immediately;</P>
                                <P>(2) Conduct an investigation in accordance with other provisions of this contract or as required by the Contracting Officer; and</P>
                                <P>(3) Submit a written report to the Contracting Officer.</P>
                                <P>
                                    (e) 
                                    <E T="03">Contractor responsibility for safety.</E>
                                     (1) Nothing in this clause, nor any Government action or failure to act in surveillance of this contract, shall relieve the Contractor of its responsibility for the safety of—
                                </P>
                                <P>(i) The Contractor's personnel and property;</P>
                                <P>(ii) The Government's personnel and property; or</P>
                                <P>(iii) The general public.</P>
                                <P>(2) Nothing in this clause shall relieve the Contractor of its responsibility for complying with applicable Federal, State, and local laws, ordinances, codes, and regulations (including those requiring the obtaining of licenses and permits) in connection with the performance of this contract.</P>
                                <P>
                                    (f) 
                                    <E T="03">Contractor responsibility for contract performance.</E>
                                     (1) Neither the number or frequency of inspections performed by the Government, nor the degree of surveillance exercised by the Government, relieve the Contractor of its responsibility for contract performance.
                                </P>
                                <P>(2) If the Government acts or fails to act in surveillance or enforcement of the safety requirements of this contract, this does not impose or add to any liability of the Government.</P>
                                <P>
                                    (g) 
                                    <E T="03">Subcontractors.</E>
                                     (1) The Contractor shall insert this clause, including this paragraph (g), in every subcontract that involves ammunition or explosives.
                                </P>
                                <P>(i) The clause shall include a provision allowing authorized Government safety representatives to evaluate subcontractor safety programs, implementation, and facilities as the Government determines necessary.</P>
                                <P>
                                    (ii) 
                                    <E T="04">Note:</E>
                                     The Government Contracting Officer or authorized representative shall notify the prime Contractor of all findings concerning subcontractor safety and compliance with the manual. The Contracting Officer or authorized representative may furnish copies to the subcontractor. The Contractor in turn shall communicate directly with the subcontractor, substituting its name for references to “the Government”. The Contractor and higher tier subcontractors shall also include provisions to allow direction to cease performance of the subcontract if a serious uncorrected or recurring safety deficiency potentially causes an imminent hazard to DoD personnel, property, or contract performance.
                                </P>
                                <P>(2) The Contractor agrees to ensure that the subcontractor complies with all contract safety requirements. The Contractor will determine the best method for verifying the adequacy of the subcontractor's compliance.</P>
                                <P>(3) The Contractor shall ensure that the subcontractor understands and agrees to the Government's right to access to the subcontractor's facilities, personnel, and safety program documentation to perform safety surveys. The Government performs these safety surveys of subcontractor facilities solely to prevent the occurrence of any mishap which would endanger the safety of DoD personnel or otherwise adversely impact upon the Government's contractual interests.</P>
                                <P>(4) The Contractor shall notify the Contracting Officer or authorized representative before issuing any subcontract when it involves ammunition or explosives. If the proposed subcontract represents a change in the place of performance, the Contractor shall request approval for such change in accordance with the clause of this contract entitled “Change in Place of Performance—Ammunition and Explosives”.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 59 FR 27675, May 27, 1994; 88 FR 80466, Nov. 17, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.223-7003</SECTNO>
                            <SUBJECT>Change in place of performance—ammunition and explosives.</SUBJECT>
                            <P>As prescribed in 223.370-5, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Change in Place of Performance—Ammunition and Explosives (DEC 1991)</HD>
                                <P>(a) The Offeror shall identify, in the “Place of Performance” provision of this solicitation, the place of performance of all ammunition and explosives work covered by the Safety Precautions for Ammunition and Explosives clause of this solicitation. Failure to furnish this information with the offer may result in rejection of the offer.</P>
                                <P>(b) The Offeror agrees not to change the place of performance of any portion of the offer covered by the Safety Precautions for Ammunition and Explosives clause contained in this solicitation after the date set for receipt of offers without the written approval of the Contracting Officer. The Contracting Officer shall grant approval only if there is enough time for the Government to perform the necessary safety reviews on the new proposed place of performance.</P>
                                <P>(c) If a contract results from this offer, the Contractor agrees not to change any place of performance previously cited without the advance written approval of the Contracting Officer.</P>
                            </EXTRACT>
                            <PRTPAGE P="505"/>
                            <HD SOURCE="HD3">(End of clause)</HD>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.223-7004-252.223-7005</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.223-7006</SECTNO>
                            <SUBJECT>Prohibition on Storage, Treatment, and Disposal of Toxic or Hazardous Materials.</SUBJECT>
                            <P>
                                <E T="03">Basic.</E>
                                 As prescribed in 223.7106 and 223.7106(a), use the following clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Prohibition on Storage, Treatment, and Disposal of Toxic or Hazardous Materials—Basic (SEP 2014)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Storage</E>
                                     means a non-transitory, semi-permanent or permanent holding, placement, or leaving of material. It does not include a temporary accumulation of a limited quantity of a material used in or a waste generated or resulting from authorized activities, such as servicing, maintenance, or repair of Department of Defense (DoD) items, equipment, or facilities.
                                </P>
                                <P>
                                    <E T="03">Toxic or hazardous materials</E>
                                     means—
                                </P>
                                <P>(i) Materials referred to in section 101(14) of the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) of 1980 (42 U.S.C. 9601(14)) and materials designated under section 102 of CERCLA (42 U.S.C. 9602) (40 CFR Part 302);</P>
                                <P>(ii) Materials that are of an explosive, flammable, or pyrotechnic nature; or</P>
                                <P>(iii) Materials otherwise identified by the Secretary of Defense as specified in DoD regulations.</P>
                                <P>(b) In accordance with 10 U.S.C. 2692, the Contractor is prohibited from storing, treating, or disposing of toxic or hazardous materials not owned by DoD on a DoD installation, except to the extent authorized by a statutory exception to 10 U.S.C. 2692 or as authorized by the Secretary of Defense. A charge may be assessed for any storage or disposal authorized under any of the exceptions to 10 U.S.C. 2692. If a charge is to be assessed, then such assessment shall be identified elsewhere in the contract with payment to the Government on a reimbursable cost basis.</P>
                                <P>(c) The Contractor shall include the substance of this clause, including this paragraph (c), in all subcontracts that require, may require, or permit a subcontractor access to a DoD installation, at any subcontract tier.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate I.</E>
                                 As prescribed in 223.7106 and 223.7106(b), use the following clause, which adds a new paragraph (c) and revises and redesignates paragraph (c) of the basic clause as paragraph (d):
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Prohibition on Storage, Treatment, and Disposal of Toxic or Hazardous Materials—Alternate I (SEP 2014)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Storage</E>
                                     means a non-transitory, semi-permanent or permanent holding, placement, or leaving of material. It does not include a temporary accumulation of a limited quantity of a material used in or a waste generated or resulting from authorized activities, such as servicing, maintenance, or repair of Department of Defense (DoD) items, equipment, or facilities.
                                </P>
                                <P>
                                    <E T="03">Toxic or hazardous materials</E>
                                     means—
                                </P>
                                <P>(i) Materials referred to in section 101(14) of the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) of 1980 (42 U.S.C. 9601(14)) and materials designated under section 102 of CERCLA (42 U.S.C. 9602) (40 CFR Part 302);</P>
                                <P>(ii) Materials that are of an explosive, flammable, or pyrotechnic nature; or</P>
                                <P>(iii) Materials otherwise identified by the Secretary of Defense as specified in DoD regulations.</P>
                                <P>(b) In accordance with 10 U.S.C. 2692, the Contractor is prohibited from storing, treating, or disposing of toxic or hazardous materials not owned by DoD on a DoD installation, except to the extent authorized by a statutory exception to 10 U.S.C. 2692 or as authorized by the Secretary of Defense. A charge may be assessed for any storage or disposal authorized under any of the exceptions to 10 U.S.C. 2692. If a charge is to be assessed, then such assessment shall be identified elsewhere in the contract with payment to the Government on a reimbursable cost basis.</P>
                                <P>(c) With respect to treatment or disposal authorized pursuant to DFARS 223.7104(10) (10 U.S.C. 2692(b)(10), and notwithstanding any other provision of the contract, the Contractor assumes all financial and environmental responsibility and liability resulting from any treatment or disposal of toxic or hazardous materials not owned by DoD on a military installation. The Contractor shall indemnify, defend, and hold the Government harmless for all costs, liability, or penalties resulting from the Contractor's treatment or disposal of toxic or hazardous materials not owned by DoD on a military installation.</P>
                                <P>(d) The Contractor shall include the substance of this clause, including this paragraph (d), in all subcontracts that require, may require, or permit a subcontractor access to a DoD installation, at any tier. Inclusion of the substance of this clause in subcontracts does not relieve the prime Contractor of liability to the Government under paragraph (c) of this clause.</P>
                            </EXTRACT>
                            <CITA>[79 FR 58698, Sept. 30, 2014, as amended at 80 FR 36898, June 26, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="506"/>
                            <SECTNO>252.223-7007</SECTNO>
                            <SUBJECT>Safeguarding Sensitive Conventional Arms, Ammunition, and Explosives.</SUBJECT>
                            <P>As prescribed in 223.7203, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Safeguarding Sensitive Conventional Arms, Ammunition, and Explosives (NOV 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition.</E>
                                     As used in this clause—
                                    <E T="03">Arms, ammunition, and explosives (AA&amp;E)</E>
                                     means those items within the scope of DoD Manual 5100.76, Physical Security of Sensitive Conventional Arms, Ammunition, and Explosives.
                                </P>
                                <P>(b) The requirements of DoD Manual 5100.76 apply to the following items of AA&amp;E being developed, produced, manufactured, or purchased for the Government, or provided to the Contractor as Government-furnished property under this contract:</P>
                                <GPOTABLE COLS="3" OPTS="L2" CDEF="s25,10,10">
                                    <BOXHD>
                                        <CHED H="1">Nomenclature</CHED>
                                        <CHED H="1">
                                            National stock
                                            <LI>number</LI>
                                        </CHED>
                                        <CHED H="1">Sensitivity category</CHED>
                                    </BOXHD>
                                    <ROW>
                                        <ENT I="22"> </ENT>
                                    </ROW>
                                    <ROW>
                                        <ENT I="22"> </ENT>
                                    </ROW>
                                </GPOTABLE>
                                <P>(c) The Contractor shall comply with the requirements of DoD Manual 5100.76, as specified in the statement of work. The edition of DoD Manual 5100.76 in effect on the date of issuance of the solicitation for this contract shall apply.</P>
                                <P>(d) The Contractor shall allow representatives of the Defense Counterintelligence and Security Agency (DCSA), and representatives of other appropriate offices of the Government, access at all reasonable times into its facilities and those of its subcontractors, for the purpose of performing surveys, inspections, and investigations necessary to review compliance with the physical security standards applicable to this contract.</P>
                                <P>(e) The Contractor shall notify the cognizant DCSA field office of any subcontract involving AA&amp;E within 10 days after award of the subcontract.</P>
                                <P>
                                    (f) 
                                    <E T="03">Subcontracts.</E>
                                     The Contractor shall ensure that the requirements of this clause are included in all subcontracts, at every tier—
                                </P>
                                <P>(1) For the development, production, manufacture, or purchase of AA&amp;E; or</P>
                                <P>(2) When AA&amp;E will be provided to the subcontractor as Government-furnished property.</P>
                                <P>(g) Nothing in this clause shall relieve the Contractor of its responsibility for complying with applicable Federal, state, and local laws, ordinances, codes, and regulations (including requirements for obtaining licenses and permits) in connection with the performance of this contract.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[61 FR 7750, Feb. 29, 1996, as amended at 64 FR 51077, Sept. 21, 1999; 88 FR 80466, Nov. 17, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.223-7008</SECTNO>
                            <SUBJECT>Prohibition of Hexavalent Chromium.</SUBJECT>
                            <P>As prescribed in 223.7306, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Prohibition of Hexavalent Chromium (JAN 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Homogeneous material</E>
                                     means a material that cannot be mechanically disjointed into different materials and is of uniform composition throughout.
                                </P>
                                <P>(1) Examples of homogeneous materials include individual types of plastics, ceramics, glass, metals, alloys, paper, board, resins, and surface coatings.</P>
                                <P>
                                    (2) Homogeneous material does not include conversion coatings that chemically modify the substrate. 
                                    <E T="03">Mechanically disjointed</E>
                                     means that the materials can, in principle, be separated by mechanical actions such as unscrewing, cutting, crushing, grinding, and abrasive processes.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Prohibition.</E>
                                     (1) Unless otherwise specified by the Contracting Officer, the Contractor shall not provide any deliverable or construction material under this contract that—
                                </P>
                                <P>(i) Contains hexavalent chromium in a concentration greater than 0.1 percent by weight in any homogenous material; or</P>
                                <P>(ii) Requires the removal or reapplication of hexavalent chromium materials during subsequent sustainment phases of the deliverable or construction material.</P>
                                <P>(2) This prohibition does not apply to hexavalent chromium produced as a by-product of manufacturing processes.</P>
                                <P>(c) If authorization for incorporation of hexavalent chromium in a deliverable or construction material is required, the Contractor shall submit a request to the Contracting Officer.</P>
                                <P>
                                    (d) 
                                    <E T="03">Subcontracts.</E>
                                     The Contractor shall include the substance of this clause, including this paragraph (d), in all subcontracts, including subcontracts for commercial products or commercial services, that are for supplies, maintenance and repair services, or construction materials.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[76 FR 25576, May 5, 2011, as amended at 78 FR 37990, June 25, 2013; 88 FR 6591, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="507"/>
                            <SECTNO>252.223-7009</SECTNO>
                            <SUBJECT>Prohibition of Procurement of Fluorinated Fire-Fighting Agent for Use on Military Installations.</SUBJECT>
                            <P>As prescribed in 223.7404, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Prohibition of Procurement of Fluorinated Fire-Fighting Agent for Use on Military Installations (MAR 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause, 
                                    <E T="03">perfluoroalkyl substances</E>
                                     and 
                                    <E T="03">polyfluoroalkyl substances</E>
                                     have the meanings given in section 322(f) of the National Defense Authorization Act for Fiscal Year 2020 (Pub. L. 116-92).
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Prohibition.</E>
                                     The Contractor shall not provide or use under this contract any fire-fighting agent that contains perfluoroalkyl substances or polyfluoroalkyl substances in excess of one part per billion.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Subcontracts.</E>
                                     The Contractor shall include the substance of this clause, including this paragraph (c), in all subcontracts, including subcontracts for commercial products and commercial services, relating to fire-fighting on a military installation.
                                </P>
                            </EXTRACT>
                            <FP>(End of clause)</FP>
                            <CITA>[89 FR 20871, Mar. 26, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7000</SECTNO>
                            <SUBJECT>Buy American—Balance of Payments Program Certificate.</SUBJECT>
                            <P>
                                <E T="03">Basic.</E>
                                 As prescribed in 225.1101(1) and (1)(i), use the following provision:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Buy American—Balance of Payments Program Certificate—Basic (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions. Commercially available off-the-shelf (COTS) item, component, critical component, critical item, domestic end product, foreign end product, qualifying country, qualifying country end product,</E>
                                     and 
                                    <E T="03">United States,</E>
                                     as used in this provision, have the meanings given in the 252.225-7001, Buy American and Balance of Payments Program—Basic clause of this solicitation.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Evaluation.</E>
                                     The Government—
                                </P>
                                <P>(1) Will evaluate offers in accordance with the policies and procedures of Part 225 of the Defense Federal Acquisition Regulation Supplement; and</P>
                                <P>(2) Will evaluate offers of qualifying country end products without regard to the restrictions of the Buy American statute or the Balance of Payments Program.</P>
                                <P>
                                    (c) 
                                    <E T="03">Certifications and identification of country of origin.</E>
                                </P>
                                <P>(1) For all line items subject to the Buy American and Balance of Payments Program—Basic clause of this solicitation, the Offeror certifies that—</P>
                                <P>(i) Each end product, except those listed in paragraphs (c)(2) or (3) of this provision, is a domestic end product and that each domestic end product listed in paragraph (c)(4) of this provision contains a critical component or a critical item; and</P>
                                <P>(ii) For end products other than COTS items, components of unknown origin are considered to have been mined, produced, or manufactured outside the United States or a qualifying country. For those end products that do not consist wholly or predominantly of iron or steel or a combination of both, the Offeror shall also indicate whether these foreign end products exceed 55 percent domestic content, except for those that are COTS items. If the percentage of the domestic content is unknown, select “no”.</P>
                                <P>(2) The Offeror certifies that the following end products are qualifying country end products:</P>
                                <GPOTABLE COLS="2" OPTS="L2" CDEF="s100,r100">
                                    <BOXHD>
                                        <CHED H="1">Line item No.</CHED>
                                        <CHED H="1">Country of origin</CHED>
                                    </BOXHD>
                                    <ROW RUL="s">
                                        <ENT I="22"> </ENT>
                                    </ROW>
                                    <ROW RUL="s">
                                        <ENT I="22"> </ENT>
                                    </ROW>
                                    <ROW>
                                        <ENT I="22"> </ENT>
                                    </ROW>
                                </GPOTABLE>
                                <P>(3) The following end products are other foreign end products, including end products manufactured in the United States that do not qualify as domestic end products. For those foreign end products that do not consist wholly or predominantly of iron or steel or a combination of both, the Offeror shall also indicate whether these foreign end products exceed 55 percent domestic content, except for those that are COTS items. If the percentage of the domestic content is unknown, select “no”.</P>
                                <GPOTABLE COLS="3" OPTS="L2" CDEF="s75,r75,r75">
                                    <BOXHD>
                                        <CHED H="1">Line item No.</CHED>
                                        <CHED H="1">
                                            Country of origin
                                            <LI>(If known)</LI>
                                        </CHED>
                                        <CHED H="1">
                                            Exceeds 55% domestic content
                                            <LI>(yes/no)</LI>
                                        </CHED>
                                    </BOXHD>
                                    <ROW RUL="s">
                                        <ENT I="22"> </ENT>
                                    </ROW>
                                    <ROW RUL="s">
                                        <PRTPAGE P="508"/>
                                        <ENT I="22"> </ENT>
                                    </ROW>
                                    <ROW>
                                        <ENT I="22"> </ENT>
                                    </ROW>
                                </GPOTABLE>
                                <P>(4) The Offeror shall separately list the line item numbers of domestic end products that contain a critical component or a critical item (see Federal Acquisition Regulation 25.105).</P>
                                <P>
                                    Domestic end products containing a critical component or a critical item: Line Item Number [
                                    <E T="03">List as necessary</E>
                                    ]
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <P>
                                <E T="03">Alternate I.</E>
                                 As prescribed in 225.1101(1) and (1)(ii), use the following provision, which adds 
                                <E T="03">South Caucasus/Central and South Asian (SC/CASA) state</E>
                                 and 
                                <E T="03">South Caucasus/Central and South Asian (SC/CASA) state end product</E>
                                 in paragraph (a), and replaces “qualifying country end products” in paragraphs (b)(2) and (c)(2) with “qualifying country end products or SC/CASA state end products”:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Buy American—Balance of Payments Program Certificate—Alternate I (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions. Commercially available off-the-shelf (COTS) item, component, critical component, critical item, domestic end product, foreign end product, qualifying country, qualifying country end product, South Caucasus/Central and South Asian (SC/CASA) state, South Caucasus/Central and South Asian (SC/CASA) state end product,</E>
                                     and 
                                    <E T="03">United States,</E>
                                     as used in this provision, have the meanings given in the 252.225-7001, Buy American and Balance of Payments Program—Alternate I clause of this solicitation.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Evaluation.</E>
                                     The Government—
                                </P>
                                <P>(1) Will evaluate offers in accordance with the policies and procedures of part 225 of the Defense Federal Acquisition Regulation Supplement; and</P>
                                <P>(2) Will evaluate offers of qualifying country end products or SC/CASA state end products without regard to the restrictions of the Buy American statute or the Balance of Payments Program.</P>
                                <P>
                                    (c) 
                                    <E T="03">Certifications and identification of country of origin.</E>
                                </P>
                                <P>(1) For all line items subject to the Buy American and Balance of Payments Program—Alternate I clause of this solicitation, the Offeror certifies that—</P>
                                <P>(i) Each end product, except those listed in paragraphs (c)(2) or (3) of this provision, is a domestic end product and that each domestic end product listed in paragraph (c)(4) of this provision contains a critical component or a critical item; and</P>
                                <P>(ii) For end products other than COTS items, components of unknown origin are considered to have been mined, produced, or manufactured outside the United States or a qualifying country. For those end products that do not consist wholly or predominantly of iron or steel or a combination of both, the Offeror shall also indicate whether these foreign end products exceed 55 percent domestic content, except for those that are COTS items. If the percentage of the domestic content is unknown, select “no”.</P>
                                <P>(2) The Offeror certifies that the following end products are qualifying country end products or SC/CASA state end products:</P>
                                <GPOTABLE COLS="2" OPTS="L2" CDEF="s100,r100">
                                    <BOXHD>
                                        <CHED H="1">Line item No.</CHED>
                                        <CHED H="1">Country of origin</CHED>
                                    </BOXHD>
                                    <ROW>
                                        <ENT I="22"> </ENT>
                                        <ENT>.</ENT>
                                    </ROW>
                                </GPOTABLE>
                                <P>(3) The following end products are other foreign end products, including end products manufactured in the United States that do not qualify as domestic end products. For those foreign end products that do not consist wholly or predominantly of iron or steel or a combination of both, the Offeror shall also indicate whether these foreign end products exceed 55 percent domestic content, except for those that are COTS items. If the percentage of the domestic content is unknown, select “no”.</P>
                                <GPOTABLE COLS="3" OPTS="L2" CDEF="s75,r75,r75">
                                    <BOXHD>
                                        <CHED H="1">Line item No.</CHED>
                                        <CHED H="1">
                                            Country of origin
                                            <LI>(if known)</LI>
                                        </CHED>
                                        <CHED H="1">
                                            Exceeds 55% domestic content
                                            <LI>(yes/no)</LI>
                                        </CHED>
                                    </BOXHD>
                                    <ROW RUL="s">
                                        <ENT I="22"> </ENT>
                                        <ENT O="xl"/>
                                        <ENT O="xl"/>
                                    </ROW>
                                    <ROW RUL="s">
                                        <ENT I="22"> </ENT>
                                        <ENT O="xl"/>
                                        <ENT O="xl"/>
                                    </ROW>
                                    <ROW>
                                        <PRTPAGE P="509"/>
                                        <ENT I="22"> </ENT>
                                        <ENT O="xl"/>
                                        <ENT O="xl"/>
                                    </ROW>
                                </GPOTABLE>
                                <P>(4) The Offeror shall separately list the line item numbers of domestic end products that contain a critical component or a critical item (see Federal Acquisition Regulation 25.105).</P>
                                <P>
                                    Domestic end products containing a critical component or a critical item: Line Item Number [
                                    <E T="03">List as necessary</E>
                                    ].
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[68 FR 15634, Mar. 31, 2003; 68 FR 25088, May 9, 2003, as amended at 70 FR 35546, June 21, 2005; 74 FR 2423, Jan. 15, 2009; 74 FR 68384, Dec. 24, 2009; 75 FR 81918, Dec. 29, 2010; 77 FR 35882, June 15, 2012; 79 FR 3520, Jan. 22, 2014; 79 FR 65818, Nov. 5, 2014; 80 FR 36899, June 26, 2015; 89 FR 11956, Feb. 15, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7001</SECTNO>
                            <SUBJECT>Buy American and Balance of Payments Program.</SUBJECT>
                            <P>
                                <E T="03">Basic.</E>
                                 As prescribed in 225.1101(2)(i) and (2)(ii), use the following clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Buy American and Balance of Payments Program—Basic (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Commercially available off-the-shelf (COTS) item</E>
                                    —
                                </P>
                                <P>(1) Means any item of supply (including construction material) that is—</P>
                                <P>(i) A commercial product (as defined in paragraph (1) of the definition of “ commercial product” in section 2.101 of the Federal Acquisition Regulation (FAR));</P>
                                <P>(ii) Sold in substantial quantities in the commercial marketplace; and</P>
                                <P>(iii) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and</P>
                                <P>(2) Does not include bulk cargo, as defined in 46 U.S.C. 40102(4), such as agricultural products and petroleum products.</P>
                                <P>
                                    <E T="03">Component</E>
                                     means an article, material, or supply incorporated directly into an end product.
                                </P>
                                <P>
                                    <E T="03">Critical component</E>
                                     means a component that is mined, produced, or manufactured in the United States and deemed critical to the U.S. supply chain. The list of critical components is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Critical item</E>
                                     means a domestic construction material or domestic end product that is deemed critical to the U.S. supply chain. The list of critical items is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Domestic end product</E>
                                     means—
                                </P>
                                <P>(1) For an end product that does not consist wholly or predominantly of iron or steel or a combination of both—</P>
                                <P>(i) An unmanufactured end product mined or produced in the United States; or</P>
                                <P>(ii) An end product manufactured in the United States if—</P>
                                <P>(A) The cost of its qualifying country components and its components that are mined, produced, or manufactured in the United States exceeds 60 percent of the cost of all its components, except that the percentage will be 65 percent for items delivered in calendar years 2024 through 2028 and 75 percent for items delivered starting in calendar year 2029, unless an alternate percentage is established for a contract in accordance with FAR 25.101(d), or award is made before January 1, 2030, for a foreign end product that exceeds 55 percent domestic content (see Defense Federal Acquisition Regulation Supplement 225.103(b)(ii)). The cost of components includes transportation costs to the place of incorporation into the end product and U.S. duty (whether or not a duty-free entry certificate is issued). Components of unknown origin are treated as foreign. Scrap generated, collected, and prepared for processing in the United States is considered domestic. A component is considered to have been mined, produced, or manufactured in the United States (regardless of its source in fact) if the end product in which it is incorporated is manufactured in the United States and the component is of a class or kind for which the Government has determined that—</P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) Sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States; or
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) It is inconsistent with the public interest to apply the restrictions of the Buy American statute; or
                                </P>
                                <P>(B) The end product is a COTS item; or</P>
                                <P>
                                    (2) For an end product that consists wholly or predominantly of iron or steel or a combination of both, an end product manufactured in the United States, if the cost of iron and steel not produced in the United States or a qualifying country constitutes less than 5 percent of the cost of all the components used in the end product (produced in the United States or a qualifying country means that all manufacturing processes of the iron or steel must take place in the United States or a qualifying country, except metallurgical processes involving refinement of steel additives). The cost of iron and steel not produced in the United States or a qualifying 
                                    <PRTPAGE P="510"/>
                                    country includes but is not limited to the cost of iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings, not produced in the United States or a qualifying country, utilized in the manufacture of the end product and a good faith estimate of the cost of all iron or steel components not produced in the United States or a qualifying country, excluding COTS fasteners. Iron or steel components of unknown origin are treated as foreign. If the end product contains multiple components, the cost of all the materials used in such end product is calculated in accordance with the explanation of cost of components in paragraph (1)(ii)(A) of this definition.
                                </P>
                                <P>
                                    <E T="03">End product</E>
                                     means those articles, materials, and supplies to be acquired under this contract for public use.
                                </P>
                                <P>
                                    <E T="03">Foreign end product</E>
                                     means an end product other than a domestic end product.
                                </P>
                                <P>
                                    <E T="03">Predominantly of iron or steel or a combination of both</E>
                                     means that the cost of the iron and steel content exceeds 50 percent of the total cost of all its components. The cost of iron and steel is the cost of the iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings utilized in the manufacture of the product and a good faith estimate of the cost of iron or steel components excluding COTS fasteners.
                                </P>
                                <P>
                                    <E T="03">Qualifying country</E>
                                     means a country with a reciprocal defense procurement memorandum of understanding or international agreement with the United States in which both countries agree to remove barriers to purchases of supplies produced in the other country or services performed by sources of the other country, and the memorandum or agreement complies, where applicable, with the requirements of section 36 of the Arms Export Control Act (22 U.S.C. 2776) and with 10 U.S.C. 2457. Accordingly, the following are qualifying countries:
                                </P>
                                <SCOL2>
                                    <LI>Australia</LI>
                                    <LI>Austria</LI>
                                    <LI>Belgium</LI>
                                    <LI>Canada</LI>
                                    <LI>Czech Republic</LI>
                                    <LI>Denmark</LI>
                                    <LI>Egypt</LI>
                                    <LI>Estonia</LI>
                                    <LI>Finland</LI>
                                    <LI>France</LI>
                                    <LI>Germany</LI>
                                    <LI>Greece</LI>
                                    <LI>Israel</LI>
                                    <LI>Italy</LI>
                                    <LI>Japan</LI>
                                    <LI>Latvia</LI>
                                    <LI>Lithuania</LI>
                                    <LI>Luxembourg</LI>
                                    <LI>Netherlands</LI>
                                    <LI>Norway</LI>
                                    <LI>Poland</LI>
                                    <LI>Portugal</LI>
                                    <LI>Slovenia</LI>
                                    <LI>Spain</LI>
                                    <LI>Sweden</LI>
                                    <LI>Switzerland</LI>
                                    <LI>Turkey</LI>
                                    <LI>United Kingdom of Great Britain and Northern Ireland.</LI>
                                </SCOL2>
                                <P>
                                    <E T="03">Qualifying country component</E>
                                     means a component mined, produced, or manufactured in a qualifying country.
                                </P>
                                <P>
                                    <E T="03">Qualifying country end product</E>
                                     means—
                                </P>
                                <P>(1) An unmanufactured end product mined or produced in a qualifying country; or</P>
                                <P>(2) An end product manufactured in a qualifying country if—</P>
                                <P>(i) The cost of the following types of components exceeds 60 percent of the cost of all its components, except that the percentage will be 65 percent for items delivered in calendar years 2024 through 2028 and 75 percent for items delivered starting in calendar year 2029, unless an alternate percentage is established for a contract:</P>
                                <P>(A) Components mined, produced, or manufactured in a qualifying country.</P>
                                <P>(B) Components mined, produced, or manufactured in the United States.</P>
                                <P>(C) Components of foreign origin of a class or kind for which the Government has determined that sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States. Components of unknown origin are treated as foreign; or</P>
                                <P>(ii) The end product is a COTS item.</P>
                                <P>
                                    <E T="03">Steel</E>
                                     means an alloy that includes at least 50 percent iron, between 0.02 and 2 percent carbon, and may include other elements.
                                </P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>(b) This clause implements 41 U.S.C. chapter 83, Buy American. In accordance with 41 U.S.C. 1907, the component test of the Buy American statute is waived for an end product that is a COTS item (see FAR 12.505(a)(1)). Unless otherwise specified, this clause applies to all line items in the contract.</P>
                                <P>(c) The Contractor shall deliver only domestic end products unless, in its offer, it specified delivery of other end products in the Buy American —Balance of Payments Program Certificate provision of the solicitation. If the Contractor certified in its offer that it will deliver a qualifying country end product, the Contractor shall deliver a qualifying country end product or, at the Contractor's option, a domestic end product.</P>
                                <P>(d) The contract price does not include duty for end products or components for which the Contractor will claim duty-free entry.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate I.</E>
                                 As prescribed in 225.1101(2)(i) and (2)(iii), use the following clause, which adds 
                                <E T="03">South Caucasus/Central and South Asian (SC/CASA) state</E>
                                 and 
                                <E T="03">South Caucasus/Central and South Asian (SC/CASA) state end product</E>
                                 to paragraph (a), and uses different paragraphs (b) and (c) than the basic clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Buy American and Balance of Payments Program—Alternate I (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                    <PRTPAGE P="511"/>
                                </P>
                                <P>
                                    <E T="03">Commercially available off-the-shelf (COTS) item</E>
                                    —
                                </P>
                                <P>(1) Means any item of supply (including construction material) that is—</P>
                                <P>(i) A commercial product (as defined in paragraph (1) of the definition of “commercial product” in section 2.101 of the Federal Acquisition Regulation (FAR));</P>
                                <P>(ii) Sold in substantial quantities in the commercial marketplace; and</P>
                                <P>(iii) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and</P>
                                <P>(2) Does not include bulk cargo, as defined in 46 U.S.C. 40102(4), such as agricultural products and petroleum products.</P>
                                <P>
                                    <E T="03">Component</E>
                                     means an article, material, or supply incorporated directly into an end product.
                                </P>
                                <P>
                                    <E T="03">Critical component</E>
                                     means a component that is mined, produced, or manufactured in the United States and deemed critical to the U.S. supply chain. The list of critical components is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Critical item</E>
                                     means a domestic construction material or domestic end product that is deemed critical to the U.S. supply chain. The list of critical items is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Domestic end product</E>
                                     means—
                                </P>
                                <P>(1) For an end product that does not consist wholly or predominantly of iron or steel or a combination of both—</P>
                                <P>(i) An unmanufactured end product mined or produced in the United States; or</P>
                                <P>(ii) An end product manufactured in the United States if—</P>
                                <P>(A) The cost of its qualifying country components and its components that are mined, produced, or manufactured in the United States exceeds 60 percent of the cost of all its components, except that the percentage will be 65 percent for items delivered in calendar years 2024 through 2028 and 75 percent for items delivered starting in calendar year 2029, unless an alternate percentage is established for a contract in accordance with FAR 25.101(d), or award is made before January 1, 2030, for a foreign end product that exceeds 55 percent domestic content (see Defense Federal Acquisition Regulation Supplement 225.103(b)(ii)).The cost of components includes transportation costs to the place of incorporation into the end product and U.S. duty (whether or not a duty-free entry certificate is issued). Components of unknown origin are treated as foreign. Scrap generated, collected, and prepared for processing in the United States is considered domestic. A component is considered to have been mined, produced, or manufactured in the United States (regardless of its source in fact) if the end product in which it is incorporated is manufactured in the United States and the component is of a class or kind for which the Government has determined that—</P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) Sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States; or
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) It is inconsistent with the public interest to apply the restrictions of the Buy American statute; or
                                </P>
                                <P>(B) The end product is a COTS item; or</P>
                                <P>(2) For an end product that consists wholly or predominantly of iron or steel or a combination of both, an end product manufactured in the United States, if the cost of iron and steel not produced in the United States or a qualifying country constitutes less than 5 percent of the cost of all the components used in the end product (produced in the United States or a qualifying country means that all manufacturing processes of the iron or steel must take place in the United States or a qualifying country, except metallurgical processes involving refinement of steel additives). The cost of iron and steel not produced in the United States or a qualifying country includes but is not limited to the cost of iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings, not produced in the United States or a qualifying country, utilized in the manufacture of the end product and a good faith estimate of the cost of all iron or steel components not produced in the United States or a qualifying country, excluding COTS fasteners. Iron or steel components of unknown origin are treated as foreign. If the end product contains multiple components, the cost of all the materials used in such end product is calculated in accordance with the explanation of cost of components in paragraph (1)(ii)(A) of this definition.</P>
                                <P>
                                    <E T="03">End product</E>
                                     means those articles, materials, and supplies to be acquired under this contract for public use.
                                </P>
                                <P>
                                    <E T="03">Foreign end product</E>
                                     means an end product other than a domestic end product.
                                </P>
                                <P>
                                    <E T="03">Predominantly of iron or steel or a combination of both</E>
                                     means that the cost of the iron and steel content exceeds 50 percent of the total cost of all its components. The cost of iron and steel is the cost of the iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings utilized in the manufacture of the product and a good faith estimate of the cost of iron or steel components excluding COTS fasteners.
                                </P>
                                <P>
                                    <E T="03">Qualifying country</E>
                                     means a country with a reciprocal defense procurement memorandum of understanding or international agreement with the United States in which both countries agree to remove barriers to purchases of supplies produced in the other country or services performed by sources of the other country, and the memorandum or agreement complies, where applicable, with the requirements of section 36 of the Arms Export Control Act (22 U.S.C. 2776) and with 10 U.S.C. 2457. Accordingly, the following are qualifying countries:
                                    <PRTPAGE P="512"/>
                                </P>
                                <SCOL2>
                                    <LI>Australia</LI>
                                    <LI>Austria</LI>
                                    <LI>Belgium</LI>
                                    <LI>Canada</LI>
                                    <LI>Czech Republic</LI>
                                    <LI>Denmark</LI>
                                    <LI>Egypt</LI>
                                    <LI>Estonia</LI>
                                    <LI>Finland</LI>
                                    <LI>France</LI>
                                    <LI>Germany</LI>
                                    <LI>Greece</LI>
                                    <LI>Israel</LI>
                                    <LI>Italy</LI>
                                    <LI>Japan</LI>
                                    <LI>Latvia</LI>
                                    <LI>Lithuania</LI>
                                    <LI>Luxembourg</LI>
                                    <LI>Netherlands</LI>
                                    <LI>Norway</LI>
                                    <LI>Poland</LI>
                                    <LI>Portugal</LI>
                                    <LI>Slovenia</LI>
                                    <LI>Spain</LI>
                                    <LI>Sweden</LI>
                                    <LI>Switzerland</LI>
                                    <LI>Turkey</LI>
                                    <LI>United Kingdom of Great Britain and Northern Ireland.</LI>
                                </SCOL2>
                                <P>
                                    <E T="03">Qualifying country component</E>
                                     means a component mined, produced, or manufactured in a qualifying country.
                                </P>
                                <P>
                                    <E T="03">Qualifying country end product</E>
                                     means—
                                </P>
                                <P>(1) An unmanufactured end product mined or produced in a qualifying country; or</P>
                                <P>(2) An end product manufactured in a qualifying country if—</P>
                                <P>(i) The cost of the following types of components exceeds 60 percent of the cost of all its components, except that the percentage will be 65 percent for items delivered in calendar years 2024 through 2028 and 75 percent for items delivered starting in calendar year 2029, unless an alternate percentage is established for a contract:</P>
                                <P>(A) Components mined, produced, or manufactured in a qualifying country.</P>
                                <P>(B) Components mined, produced, or manufactured in the United States.</P>
                                <P>(C) Components of foreign origin of a class or kind for which the Government has determined that sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States. Components of unknown origin are treated as foreign; or</P>
                                <P>(ii) The end product is a COTS item.</P>
                                <P>
                                    <E T="03">South Caucasus/Central and South Asian (SC/CASA) state</E>
                                     means Armenia, Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, Pakistan, Tajikistan, Turkmenistan, or Uzbekistan.
                                </P>
                                <P>
                                    <E T="03">South Caucasus/Central and South Asian (SC/CASA) state end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of an SC/CASA state; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in an SC/CASA state into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Steel</E>
                                     means an alloy that includes at least 50 percent iron, between 0.02 and 2 percent carbon, and may include other elements.
                                </P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>(b) This clause implements the Balance of Payments Program. Unless otherwise specified, this clause applies to all line items in the contract.</P>
                                <P>(c) The Contractor shall deliver only domestic end products unless, in its offer, it specified delivery of other end products in the Buy American Balance of Payments Program Certificate provision of the solicitation. If the Contractor certified in its offer that it will deliver a qualifying country end product or an SC/CASA state end product, the Contractor shall deliver a qualifying country end product, an SC/CASA state end product, or, at the Contractor's option, a domestic end product.</P>
                                <P>(d) The contract price does not include duty for end products or components for which the Contractor will claim duty-free entry.</P>
                                <P>
                                    <E T="03">Alternate II.</E>
                                     As prescribed in 225.1101(2)(i) and (2)(iv), use the following clause, which includes, in the definitions of “domestic end product” at paragraph (1)(ii)(A) and “qualifying country end product” at paragraph (2)(i), the domestic content threshold that will apply to the entire contract period of performance.
                                </P>
                                <HD SOURCE="HD1">Buy American and Balance of Payments Program—Alternate II (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Commercially available off-the-shelf (COTS) item</E>
                                    —
                                </P>
                                <P>(1) Means any item of supply (including construction material) that is—</P>
                                <P>(i) A commercial product (as defined in paragraph (1) of the definition of “commercial product” in section 2.101 of the Federal Acquisition Regulation (FAR));</P>
                                <P>(ii) Sold in substantial quantities in the commercial marketplace; and</P>
                                <P>(iii) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and</P>
                                <P>(2) Does not include bulk cargo, as defined in 46 U.S.C. 40102(4), such as agricultural products and petroleum products.</P>
                                <P>
                                    <E T="03">Component</E>
                                     means an article, material, or supply incorporated directly into an end product.
                                </P>
                                <P>
                                    <E T="03">Critical component</E>
                                     means a component that is mined, produced, or manufactured in the United States and deemed critical to the U.S. supply chain. The list of critical components is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Critical item</E>
                                     means a domestic construction material or domestic end product that is deemed critical to the U.S. supply chain. The list of critical items is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Domestic end product</E>
                                     means—
                                    <PRTPAGE P="513"/>
                                </P>
                                <P>(1) For an end product that does not consist wholly or predominantly of iron or steel or a combination of both—</P>
                                <P>(i) An unmanufactured end product mined or produced in the United States; or</P>
                                <P>(ii) An end product manufactured in the United States if—</P>
                                <P>(A) The cost of its qualifying country components and its components that are mined, produced, or manufactured in the United States exceeds, for the entire period of performance for a contract awarded in: calendar year 2023, 60 percent of the cost of all its components; calendar years 2024 through 2028, 65 percent of the cost of all its components; or calendar year 2029 or later, 75 percent of the cost of all its components. The cost of components includes transportation costs to the place of incorporation into the end product and U.S. duty (whether or not a duty-free entry certificate is issued). Components of unknown origin are treated as foreign. Scrap generated, collected, and prepared for processing in the United States is considered domestic. A component is considered to have been mined, produced, or manufactured in the United States (regardless of its source in fact) if the end product in which it is incorporated is manufactured in the United States and the component is of a class or kind for which the Government has determined that—</P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) Sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States; or
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) It is inconsistent with the public interest to apply the restrictions of the Buy American statute; or
                                </P>
                                <P>(B) The end product is a COTS item; or</P>
                                <P>(2) For an end product that consists wholly or predominantly of iron or steel or a combination of both, an end product manufactured in the United States, if the cost of iron and steel not produced in the United States or a qualifying country constitutes less than 5 percent of the cost of all the components used in the end product (produced in the United States or a qualifying country means that all manufacturing processes of the iron or steel must take place in the United States or a qualifying country, except metallurgical processes involving refinement of steel additives). The cost of iron and steel not produced in the United States or a qualifying country includes but is not limited to the cost of iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings, not produced in the United States or a qualifying country, utilized in the manufacture of the end product and a good faith estimate of the cost of all iron or steel components not produced in the United States or a qualifying country, excluding COTS fasteners. Iron or steel components of unknown origin are treated as foreign. If the end product contains multiple components, the cost of all the materials used in such end product is calculated in accordance with the explanation of cost of components in paragraph (1)(ii)(A) of this definition.</P>
                                <P>
                                    <E T="03">End product</E>
                                     means those articles, materials, and supplies to be acquired under this contract for public use.
                                </P>
                                <P>
                                    <E T="03">Foreign end product</E>
                                     means an end product other than a domestic end product.
                                </P>
                                <P>
                                    <E T="03">Predominantly of iron or steel or a combination of both</E>
                                     means that the cost of the iron and steel content exceeds 50 percent of the total cost of all its components. The cost of iron and steel is the cost of the iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings utilized in the manufacture of the product and a good faith estimate of the cost of iron or steel components excluding COTS fasteners.
                                </P>
                                <P>
                                    <E T="03">Qualifying country</E>
                                     means a country with a reciprocal defense procurement memorandum of understanding or international agreement with the United States in which both countries agree to remove barriers to purchases of supplies produced in the other country or services performed by sources of the other country, and the memorandum or agreement complies, where applicable, with the requirements of section 36 of the Arms Export Control Act (22 U.S.C. 2776) and with 10 U.S.C. 2457. Accordingly, the following are qualifying countries:
                                </P>
                                <FP SOURCE="FP-1">Australia</FP>
                                <FP SOURCE="FP-1">Austria</FP>
                                <FP SOURCE="FP-1">Belgium</FP>
                                <FP SOURCE="FP-1">Canada</FP>
                                <FP SOURCE="FP-1">Czech Republic</FP>
                                <FP SOURCE="FP-1">Denmark</FP>
                                <FP SOURCE="FP-1">Egypt</FP>
                                <FP SOURCE="FP-1">Estonia</FP>
                                <FP SOURCE="FP-1">Finland</FP>
                                <FP SOURCE="FP-1">France</FP>
                                <FP SOURCE="FP-1">Germany</FP>
                                <FP SOURCE="FP-1">Greece</FP>
                                <FP SOURCE="FP-1">Israel</FP>
                                <FP SOURCE="FP-1">Italy</FP>
                                <FP SOURCE="FP-1">Japan</FP>
                                <FP SOURCE="FP-1">Latvia</FP>
                                <FP SOURCE="FP-1">Lithuania</FP>
                                <FP SOURCE="FP-1">Luxembourg</FP>
                                <FP SOURCE="FP-1">Netherlands</FP>
                                <FP SOURCE="FP-1">Norway</FP>
                                <FP SOURCE="FP-1">Poland</FP>
                                <FP SOURCE="FP-1">Portugal</FP>
                                <FP SOURCE="FP-1">Slovenia</FP>
                                <FP SOURCE="FP-1">Spain</FP>
                                <FP SOURCE="FP-1">Sweden</FP>
                                <FP SOURCE="FP-1">Switzerland</FP>
                                <FP SOURCE="FP-1">Turkey</FP>
                                <FP SOURCE="FP-1">United Kingdom of Great Britain and Northern Ireland.</FP>
                                <P>
                                    <E T="03">Qualifying country component</E>
                                     means a component mined, produced, or manufactured in a qualifying country.
                                </P>
                                <P>
                                    <E T="03">Qualifying country end product</E>
                                     means—
                                </P>
                                <P>
                                    (1) An unmanufactured end product mined or produced in a qualifying country; or
                                    <PRTPAGE P="514"/>
                                </P>
                                <P>(2) An end product manufactured in a qualifying country if—</P>
                                <P>(i) The cost of the following types of components exceeds, for the entire period of performance for a contract awarded in calendar year 2023, 60 percent of the cost of all its components; calendar years 2024 through 2028, 65 percent of the cost of all its components; or calendar year 2029 or later, 75 percent of the cost of all its components:</P>
                                <P>(A) Components mined, produced, or manufactured in a qualifying country.</P>
                                <P>(B) Components mined, produced, or manufactured in the United States.</P>
                                <P>(C) Components of foreign origin of a class or kind for which the Government has determined that sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States. Components of unknown origin are treated as foreign; or</P>
                                <P>(ii) The end product is a COTS item.</P>
                                <P>
                                    <E T="03">Steel</E>
                                     means an alloy that includes at least 50 percent iron, between 0.02 and 2 percent carbon, and may include other elements.
                                </P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>(b) This clause implements 41 U.S.C. chapter 83, Buy American. In accordance with 41 U.S.C. 1907, the component test of the Buy American statute is waived for an end product that is a COTS item (see FAR 12.505(a)(1)). Unless otherwise specified, this clause applies to all line items in the contract.</P>
                                <P>(c) The Contractor shall deliver only domestic end products unless, in its offer, it specified delivery of other end products in the Buy American—Balance of Payments Program Certificate provision of the solicitation. If the Contractor certified in its offer that it will deliver a qualifying country end product, the Contractor shall deliver a qualifying country end product or, at the Contractor's option, a domestic end product.</P>
                                <P>(d) The contract price does not include duty for end products or components for which the Contractor will claim duty-free entry.</P>
                                <HD SOURCE="HD3">(End of clause)</HD>
                                <P>
                                    <E T="03">Alternate III.</E>
                                     As prescribed in 225.1101(2)(i) and (2)(v), use the following clause, which includes, in the definitions of “domestic end product” at paragraph (1)(ii)(A) and “qualifying country end product” at paragraph (2)(i), the domestic content threshold that will apply to the entire contract period of performance; adds “South Caucasus/Central and South Asian (SC/CASA) state” and “South Caucasus/Central and South Asian (SC/CASA) state end product” to paragraph (a); and uses different paragraphs (b) and (c) than the basic clause:
                                </P>
                                <HD SOURCE="HD1">Buy American and Balance of Payments Program—Alternate III (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Commercially available off-the-shelf (COTS) item</E>
                                    —
                                </P>
                                <P>(1) Means any item of supply (including construction material) that is—</P>
                                <P>(i) A commercial product (as defined in paragraph (1) of the definition of “commercial product” in section 2.101 of the Federal Acquisition Regulation (FAR));</P>
                                <P>(ii) Sold in substantial quantities in the commercial marketplace; and</P>
                                <P>(iii) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and</P>
                                <P>(2) Does not include bulk cargo, as defined in 46 U.S.C. 40102(4), such as agricultural products and petroleum products.</P>
                                <P>
                                    <E T="03">Component</E>
                                     means an article, material, or supply incorporated directly into an end product.
                                </P>
                                <P>
                                    <E T="03">Critical component</E>
                                     means a component that is mined, produced, or manufactured in the United States and deemed critical to the U.S. supply chain. The list of critical components is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Critical item</E>
                                     means a domestic construction material or domestic end product that is deemed critical to the U.S. supply chain. The list of critical items is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Domestic end product</E>
                                     means—
                                </P>
                                <P>(1) For an end product that does not consist wholly or predominantly of iron or steel or a combination of both—</P>
                                <P>(i) An unmanufactured end product mined or produced in the United States; or</P>
                                <P>(ii) An end product manufactured in the United States if—</P>
                                <P>
                                    (A) The cost of its qualifying country components and its components that are mined, produced, or manufactured in the United States exceeds, for the entire period of performance for a contract awarded in: calendar year 2023, 60 percent of the cost of all its components; calendar years 2024 through 2028, 65 percent of the cost of all its components; or calendar year 2029 or later, 75 percent of the cost of all its components. The cost of components includes transportation costs to the place of incorporation into the end product and U.S. duty (whether or not a duty-free entry certificate is issued). Components of unknown origin are treated as foreign. Scrap generated, collected, and prepared for processing in the United States is considered domestic. A component is considered to have been mined, produced, or manufactured in the United States (regardless of its source in fact) if the end product in which it is incorporated is manufactured in the United States and the component is of a class or kind for which the Government has determined that—
                                    <PRTPAGE P="515"/>
                                </P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) Sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States; or
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) It is inconsistent with the public interest to apply the restrictions of the Buy American statute; or
                                </P>
                                <P>(B) The end product is a COTS item; or</P>
                                <P>(2) For an end product that consists wholly or predominantly of iron or steel or a combination of both, an end product manufactured in the United States, if the cost of iron and steel not produced in the United States or a qualifying country constitutes less than 5 percent of the cost of all the components used in the end product (produced in the United States or a qualifying country means that all manufacturing processes of the iron or steel must take place in the United States or a qualifying country, except metallurgical processes involving refinement of steel additives). The cost of iron and steel not produced in the United States or a qualifying country includes but is not limited to the cost of iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings, not produced in the United States or a qualifying country, utilized in the manufacture of the end product and a good faith estimate of the cost of all iron or steel components not produced in the United States or a qualifying country, excluding COTS fasteners. Iron or steel components of unknown origin are treated as foreign. If the end product contains multiple components, the cost of all the materials used in such end product is calculated in accordance with the explanation of cost of components in paragraph (1)(ii)(A) of this definition.</P>
                                <P>
                                    <E T="03">End product</E>
                                     means those articles, materials, and supplies to be acquired under this contract for public use.
                                </P>
                                <P>
                                    <E T="03">Foreign end product</E>
                                     means an end product other than a domestic end product.
                                </P>
                                <P>
                                    <E T="03">Predominantly of iron or steel or a combination of both</E>
                                     means that the cost of the iron and steel content exceeds 50 percent of the total cost of all its components. The cost of iron and steel is the cost of the iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings utilized in the manufacture of the product and a good faith estimate of the cost of iron or steel components excluding COTS fasteners.
                                </P>
                                <P>
                                    <E T="03">Qualifying country</E>
                                     means a country with a reciprocal defense procurement memorandum of understanding or international agreement with the United States in which both countries agree to remove barriers to purchases of supplies produced in the other country or services performed by sources of the other country, and the memorandum or agreement complies, where applicable, with the requirements of section 36 of the Arms Export Control Act (22 U.S.C. 2776) and with 10 U.S.C. 2457. Accordingly, the following are qualifying countries:
                                </P>
                                <FP SOURCE="FP-1">Australia</FP>
                                <FP SOURCE="FP-1">Austria</FP>
                                <FP SOURCE="FP-1">Belgium</FP>
                                <FP SOURCE="FP-1">Canada</FP>
                                <FP SOURCE="FP-1">Czech Republic</FP>
                                <FP SOURCE="FP-1">Denmark</FP>
                                <FP SOURCE="FP-1">Egypt</FP>
                                <FP SOURCE="FP-1">Estonia</FP>
                                <FP SOURCE="FP-1">Finland</FP>
                                <FP SOURCE="FP-1">France</FP>
                                <FP SOURCE="FP-1">Germany</FP>
                                <FP SOURCE="FP-1">Greece</FP>
                                <FP SOURCE="FP-1">Israel</FP>
                                <FP SOURCE="FP-1">Italy</FP>
                                <FP SOURCE="FP-1">Japan</FP>
                                <FP SOURCE="FP-1">Latvia</FP>
                                <FP SOURCE="FP-1">Lithuania</FP>
                                <FP SOURCE="FP-1">Luxembourg</FP>
                                <FP SOURCE="FP-1">Netherlands</FP>
                                <FP SOURCE="FP-1">Norway</FP>
                                <FP SOURCE="FP-1">Poland</FP>
                                <FP SOURCE="FP-1">Portugal</FP>
                                <FP SOURCE="FP-1">Slovenia</FP>
                                <FP SOURCE="FP-1">Spain</FP>
                                <FP SOURCE="FP-1">Sweden</FP>
                                <FP SOURCE="FP-1">Switzerland</FP>
                                <FP SOURCE="FP-1">Turkey</FP>
                                <FP SOURCE="FP-1">United Kingdom of Great Britain and Northern Ireland.</FP>
                                <P>
                                    <E T="03">Qualifying country component</E>
                                     means a component mined, produced, or manufactured in a qualifying country.
                                </P>
                                <P>
                                    <E T="03">Qualifying country end product</E>
                                     means—
                                </P>
                                <P>(1) An unmanufactured end product mined or produced in a qualifying country; or</P>
                                <P>(2) An end product manufactured in a qualifying country if—</P>
                                <P>(i) The cost of the following types of components exceeds, for the entire period of performance for a contract awarded in: calendar year 2023, 60 percent of the cost of all its components; calendar years 2024 through 2028, 65 percent of the cost of all its components; or calendar year 2029 or later, 75 percent of the cost of all its components:</P>
                                <P>(A) Components mined, produced, or manufactured in a qualifying country.</P>
                                <P>(B) Components mined, produced, or manufactured in the United States.</P>
                                <P>(C) Components of foreign origin of a class or kind for which the Government has determined that sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States. Components of unknown origin are treated as foreign; or</P>
                                <P>(ii) The end product is a COTS item.</P>
                                <P>
                                    <E T="03">South Caucasus/Central and South Asian (SC/CASA) state</E>
                                     means Armenia, Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, Pakistan, Tajikistan, Turkmenistan, or Uzbekistan.
                                </P>
                                <P>
                                    <E T="03">South Caucasus/Central and South Asian (SC/CASA) state end product</E>
                                     means an article that—
                                </P>
                                <P>
                                    (1) Is wholly the growth, product, or manufacture of an SC/CASA state; or
                                    <PRTPAGE P="516"/>
                                </P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in an SC/CASA state into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Steel</E>
                                     means an alloy that includes at least 50 percent iron, between 0.02 and 2 percent carbon, and may include other elements.
                                </P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>(b) This clause implements the Balance of Payments Program. Unless otherwise specified, this clause applies to all line items in the contract.</P>
                                <P>(c) The Contractor shall deliver only domestic end products unless, in its offer, it specified delivery of other end products in the Buy American—Balance of Payments Program Certificate provision of the solicitation. If the Contractor certified in its offer that it will deliver a qualifying country end product or an SC/CASA state end product, the Contractor shall deliver a qualifying country end product, an SC/CASA state end product, or, at the Contractor's option, a domestic end product.</P>
                                <P>(d) The contract price does not include duty for end products or components for which the Contractor will claim duty-free entry.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[68 FR 15634, Mar. 31, 2003, as amended at 70 FR 35546, June 21, 2005; 74 FR 2423, Jan. 15, 2009; 75 FR 81918, Dec. 29, 2010; 76 FR 58138, Sept. 20, 2011; 77 FR 35882, June 15, 2012; 77 FR 76942, Dec. 31, 2012; 79 FR 3520, Jan. 22, 2014; 79 FR 65819, Nov. 5, 2014; 80 FR 36899, June 26, 2015; 81 FR 50651, Aug. 2, 2016; 81 FR 93840, Dec. 22, 2016; 82 FR 61484, Dec. 28, 2017; 87 FR 37443, June 23, 2022; 88 FR 6591, Jan. 31, 2023; 89 FR 11957, Feb. 15, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7002</SECTNO>
                            <SUBJECT>Qualifying Country Sources as Subcontractors.</SUBJECT>
                            <P>As prescribed in 225.1101(3), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Qualifying Country Sources as Subcontractors (MAR 2022)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition. Qualifying country,</E>
                                     as used in this clause, means a country with a reciprocal defense procurement memorandum of understanding or international agreement with the United States in which both countries agree to remove barriers to purchases of supplies produced in the other country or services performed by sources of the other country, and the memorandum or agreement complies, where applicable, with the requirements of section 36 of the Arms Export Control Act (22 U.S.C. 2776) and with 10 U.S.C. 2457. Accordingly, the following are qualifying countries:
                                </P>
                                <SCOL2>
                                    <LI>Australia</LI>
                                    <LI>Austria</LI>
                                    <LI>Belgium</LI>
                                    <LI>Canada</LI>
                                    <LI>Czech Republic</LI>
                                    <LI>Denmark</LI>
                                    <LI>Egypt</LI>
                                    <LI>Estonia</LI>
                                    <LI>Finland</LI>
                                    <LI>France</LI>
                                    <LI>Germany</LI>
                                    <LI>Greece</LI>
                                    <LI>Israel</LI>
                                    <LI>Italy</LI>
                                    <LI>Japan</LI>
                                    <LI>Latvia</LI>
                                    <LI>Lithuania</LI>
                                    <LI>Luxembourg</LI>
                                    <LI>Netherlands</LI>
                                    <LI>Norway</LI>
                                    <LI>Poland</LI>
                                    <LI>Portugal</LI>
                                    <LI>Slovenia</LI>
                                    <LI>Spain</LI>
                                    <LI>Sweden</LI>
                                    <LI>Switzerland</LI>
                                    <LI>Turkey</LI>
                                    <LI>United Kingdom of Great Britain and Northern Ireland</LI>
                                </SCOL2>
                                <P>(b) Subject to the restrictions in section 225.872 of the Defense FAR Supplement, the Contractor shall not preclude qualifying country sources or U.S. sources from competing for subcontracts under this contract.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[68 FR 15634, Mar. 31, 2003, as amended at 77 FR 38737, June 29, 2012; 77 FR 76942, Dec. 31, 2012; 81 FR 50651, Aug. 2, 2016: 81 FR 93841, Dec. 22, 2016; 82 FR 61484, Dec. 28, 2017; 87 FR 15816, Mar. 18, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7003</SECTNO>
                            <SUBJECT>Report of intended performance outside the United States and Canada—Submission with offer.</SUBJECT>
                            <P>As prescribed in 225.7204(a), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Report of Intended Performance Outside the United States and Canada—Submission With Offer (OCT 2020)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition. United States</E>
                                    , as used in this provision, means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>(b) The offeror shall submit, with its offer, a report of intended performance outside the United States and Canada if—</P>
                                <P>(1) The offer exceeds $15 million in value; and</P>
                                <P>(2) The offeror is aware that the offeror or a first-tier subcontractor intends to perform any part of the contract outside the United States and Canada that—</P>
                                <P>(i) Exceeds $750,000 in value; and</P>
                                <P>(ii) Could be performed inside the United States or Canada.</P>
                                <P>(c) Information to be reported includes that for—</P>
                                <P>
                                    (1) Subcontracts;
                                    <PRTPAGE P="517"/>
                                </P>
                                <P>(2) Purchases; and</P>
                                <P>(3) Intracompany transfers when transfers originate in a foreign location.</P>
                                <P>(d) The offeror shall submit the report using—</P>
                                <P>(1) DD Form 2139, Report of Contract Performance Outside the United States; or</P>
                                <P>(2) A computer-generated report that contains all information required by DD Form 2139.</P>
                                <P>
                                    (e) The offeror may obtain a copy of DD Form 2139 from the Contracting Officer or via the Internet at 
                                    <E T="03">http://www.dtic.mil/whs/directives/infomgt/forms/formsprogram.htm.</E>
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[70 FR 20839, Apr. 22, 2005, as amended at 70 FR 35546, June 21, 2005; 71 FR 75893, Dec. 19, 2006; 75 FR 45074, Aug. 2, 2010; 80 FR 36905, June 26, 2015; 85 FR 61504, Sept. 29, 2020]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7004</SECTNO>
                            <SUBJECT>Report of Intended Performance Outside the United States and Canada—Submission after Award.</SUBJECT>
                            <P>As prescribed in 225.7204(b), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Report of Intended Performance Outside the United States and Canada—Submission After Award (Jul 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Reporting requirement.</E>
                                     The Contractor shall submit a report in accordance with this clause, if the Contractor or a first-tier subcontractor will perform any part of this contract outside the United States and Canada that—
                                </P>
                                <P>(1) Exceeds the threshold specified in Defense Federal Acquisition Regulation Supplement 225.7201(a) on the date of award of this contract; and</P>
                                <P>(2) Could be performed inside the United States or Canada.</P>
                                <P>
                                    (c) 
                                    <E T="03">Submission of reports.</E>
                                     The Contractor—
                                </P>
                                <P>(1) Shall submit a report as soon as practical after the information is known;</P>
                                <P>(2) To the maximum extent practicable, shall submit a report regarding a first-tier subcontractor at least 30 days before award of the subcontract;</P>
                                <P>(3) Need not resubmit information submitted with its offer, unless the information changes;</P>
                                <P>(4) Shall submit all reports to the Contracting Officer; and</P>
                                <P>(5) Shall submit a copy of each report to: Principal Director, Defense Pricing, Contracting, and Acquisition Policy (Contract Policy), OUSD(A&amp;S) DPCAP/CP, Washington, DC 20301-3060.</P>
                                <P>
                                    (d) 
                                    <E T="03">Report format.</E>
                                     The Contractor—
                                </P>
                                <P>(1) Shall submit reports using—</P>
                                <P>(i) DD Form 2139, Report of Contract Performance Outside the United States; or</P>
                                <P>(ii) A computer-generated report that contains all information required by DD Form 2139; and</P>
                                <P>
                                    (2) May obtain copies of DD Form 2139 from the Contracting Officer or via the Internet at 
                                    <E T="03">https://www.esd.whs.mil/Directives/forms/. </E>
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[70 FR 20839, Apr. 22, 2005, as amended at 70 FR 35546, June 21, 2005; 71 FR 75893, Dec. 19, 2006; 72 FR 30278, May 31, 2007; 75 FR 45074, Aug. 2, 2010; 78 FR 73450, Dec. 6, 2013; 80 FR 36905, June 26, 2015; 84 FR 25188, May 31, 2019; 85 FR 61504, Sept. 29, 2020; 89 FR 60832, July 29, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7005</SECTNO>
                            <SUBJECT>Identification of Expenditures in the United States.</SUBJECT>
                            <P>As prescribed in 225.1103(1), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Identification of Expenditures In The United States (JUN 2005)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition. United States,</E>
                                     as used in this clause, means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>(b) This clause applies only if the Contractor is—</P>
                                <P>(1) A concern incorporated in the United States (including a subsidiary that is incorporated in the United States, even if the parent corporation is not incorporated in the United States); or</P>
                                <P>(2) An unincorporated concern having its principal place of business in the United States.</P>
                                <P>(c) On each invoice, voucher, or other request for payment under this contract, the Contractor shall identify that part of the requested payment that represents estimated expenditures in the United States. The identification—</P>
                                <P>(1) May be expressed either as dollar amounts or as percentages of the total amount of the request for payment;</P>
                                <P>(2) Should be based on reasonable estimates; and</P>
                                <P>(3) Shall state the full amount of the payment requested, subdivided into the following categories:</P>
                                <P>(i) U.S. products—expenditures for material and equipment manufactured or produced in the United States, including end products, components, or construction material, but excluding transportation;</P>
                                <P>(ii) U.S. services—expenditures for services performed in the United States, including all charges for overhead, other indirect costs, and profit under construction or service contracts;</P>
                                <P>
                                    (iii) Transportation on U.S. carriers—expenditures for transportation furnished by 
                                    <PRTPAGE P="518"/>
                                    U.S. flag, ocean, surface, and air carriers; and
                                </P>
                                <P>(iv) Expenditures not identified under paragraphs (c)(3)(i) through (iii) of this clause.</P>
                                <P>(d) Nothing in this clause requires the establishment or maintenance of detailed accounting records or gives the U.S. Government any right to audit the Contractor's books or records.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[79 FR 75757, Dec. 19, 2014]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7006</SECTNO>
                            <SUBJECT>Acquisition of the American flag.</SUBJECT>
                            <P>As prescribed in 225.7002-3(c), insert the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Acquisition of the American Flag (DEC 2022)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition. United States,</E>
                                     as used in this clause, means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>(b) If the Contractor is required to deliver under this contract one or more American flags (Product or Service Code 8345), such flag(s), including the materials and components thereof, shall be manufactured in the United States, consistent with the requirements at 10 U.S.C. 4862 (commonly known as the “Berry Amendment”).</P>
                                <P>
                                    (c) This clause does not apply to the acquisition of any end items or components related to flying or displaying the flag (
                                    <E T="03">e.g.,</E>
                                     flagpoles and accessories).
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[80 FR 51749, Aug. 26, 2015, as amended at 87 FR 76997, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7007</SECTNO>
                            <SUBJECT>Prohibition on Acquisition of Certain Items from Communist Chinese Military Companies.</SUBJECT>
                            <P>As prescribed in 225.1103(4), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Prohibition on Acquisition of Certain Items From Communist Chinese Military Companies (DEC 2018)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">600 series of the Commerce Control List</E>
                                     means the series of 5-character export control classification numbers (ECCNs) of the Commerce Control List of the Export Administration Regulations in 15 CFR part 774, supplement no. 1, that have a “6” as the third character. The 600 series constitutes the munitions and munitions-related ECCNs within the larger Commerce Control List. (See definition of “600 series” in 15 CFR 772.)
                                </P>
                                <P>
                                    <E T="03">Communist Chinese military company</E>
                                     means any entity, regardless of geographic location, that is—
                                </P>
                                <P>(1) A part of the commercial or defense industrial base of the People's Republic of China (including a subsidiary or affiliate of such entity); or</P>
                                <P>(2) Owned or controlled by, or affiliated with, an element of the Government or armed forces of the People's Republic of China.</P>
                                <P>
                                    <E T="03">Item</E>
                                     means—
                                </P>
                                <P>(1) A USML defense article, as defined at 22 CFR 120.6;</P>
                                <P>(2) A USML defense service, as defined at 22 CFR 120.9; or</P>
                                <P>(3) A 600 series item, as defined at 15 CFR 772.1.</P>
                                <P>
                                    <E T="03">United States Munitions List</E>
                                     means the munitions list of the International Traffic in Arms Regulation in 22 CFR part 121.
                                </P>
                                <P>(b) Any items covered by the United States Munitions List or the 600 series of the Commerce Control List that are delivered under this contract may not be acquired, directly or indirectly, from a Communist Chinese military company.</P>
                                <P>(c) The Contractor shall insert the substance of this clause, including this paragraph (c), in all subcontracts for items covered by the United States Munitions List or the 600 series of the Commerce Control List.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[83 FR 66073, Dec. 21, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7008</SECTNO>
                            <SUBJECT>Restriction on Acquisition of Specialty Metals.</SUBJECT>
                            <P>As prescribed in 225.7003-5(a)(1), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Restriction on Acquisition of Specialty Metals (MAR 2013)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Alloy</E>
                                     means a metal consisting of a mixture of a basic metallic element and one or more metallic, or non-metallic, alloying elements.
                                </P>
                                <P>
                                    (i) For alloys named by a single metallic element (
                                    <E T="03">e.g.,</E>
                                     titanium alloy), it means that the alloy contains 50 percent or more of the named metal (by mass).
                                </P>
                                <P>
                                    (ii) If two metals are specified in the name (
                                    <E T="03">e.g.,</E>
                                     nickel-iron alloy), those metals are the two predominant elements in the alloy, and together they constitute 50 percent or more of the alloy (by mass).
                                </P>
                                <P>
                                    <E T="03">Produce</E>
                                     means—
                                </P>
                                <P>(i) Atomization;</P>
                                <P>(ii) Sputtering; or</P>
                                <P>(iii) Final consolidation of non-melt derived metal powders.</P>
                                <P>
                                    <E T="03">Specialty metal</E>
                                     means—
                                </P>
                                <P>
                                    (i) Steel—
                                    <PRTPAGE P="519"/>
                                </P>
                                <P>(A) With a maximum alloy content exceeding one or more of the following limits: Manganese, 1.65 percent; silicon, 0.60 percent; or copper, 0.60 percent; or</P>
                                <P>(B) Containing more than 0.25 percent of any of the following elements: Aluminum, chromium, cobalt, molybdenum, nickel, niobium (columbium), titanium, tungsten, or vanadium;</P>
                                <P>(ii) Metal alloys consisting of—</P>
                                <P>(A) Nickel or iron-nickel alloys that contain a total of alloying metals other than nickel and iron in excess of 10 percent; or</P>
                                <P>(B) Cobalt alloys that contain a total of alloying metals other than cobalt and iron in excess of 10 percent;</P>
                                <P>(iii) Titanium and titanium alloys; or</P>
                                <P>(iv) Zirconium and zirconium alloys.</P>
                                <P>
                                    <E T="03">Steel</E>
                                     means an iron alloy that includes between .02 and 2 percent carbon and may include other elements.
                                </P>
                                <P>(b) Any specialty metal delivered under this contract shall be melted or produced in the United States or its outlying areas.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[74 FR 37639, July 29, 2009, as amended at 78 FR 18879, Mar. 28, 2013]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7009</SECTNO>
                            <SUBJECT>Restriction on Acquisition of Certain Articles Containing Specialty Metals.</SUBJECT>
                            <P>As prescribed in 225.7003-5(a)(2), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Restriction on Acquisition of Certain Articles Containing Specialty Metals (JAN 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Alloy</E>
                                     means a metal consisting of a mixture of a basic metallic element and one or more metallic, or non-metallic, alloying elements.
                                </P>
                                <P>(i) For alloys named by a single metallic element (e.g., titanium alloy), it means that the alloy contains 50 percent or more of the named metal (by mass).</P>
                                <P>(ii) If two metals are specified in the name (e.g., nickel-iron alloy), those metals are the two predominant elements in the alloy, and together they constitute 50 percent or more of the alloy (by mass).</P>
                                <P>
                                    <E T="03">Assembly</E>
                                     means an item forming a portion of a system or subsystem that—
                                </P>
                                <P>(i) Can be provisioned and replaced as an entity; and</P>
                                <P>(ii) Incorporates multiple, replaceable parts.</P>
                                <P>
                                    <E T="03">Commercial derivative military article</E>
                                     means an item acquired by the Department of Defense that is or will be produced using the same production facilities, a common supply chain, and the same or similar production processes that are used for the production of articles predominantly used by the general public or by nongovernmental entities for purposes other than governmental purposes.
                                </P>
                                <P>
                                    <E T="03">Commercially available off-the-shelf item</E>
                                    —
                                </P>
                                <P>(i) Means any item of supply that is—</P>
                                <P>(A) A commercial product (as defined in paragraph (1) of the definition of “commercial product” in section 2.101 of the Federal Acquisition Regulation);</P>
                                <P>(B) Sold in substantial quantities in the commercial marketplace; and</P>
                                <P>(C) Offered to the Government, under this contract or a subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and</P>
                                <P>(ii) Does not include bulk cargo, as defined in 46 U.S.C. 40102(4), such as agricultural products and petroleum products.</P>
                                <P>
                                    <E T="03">Component</E>
                                     means any item supplied to the Government as part of an end item or of another component.
                                </P>
                                <P>
                                    <E T="03">Electronic component</E>
                                     means an item that operates by controlling the flow of electrons or other electrically charged particles in circuits, using interconnections of electrical devices such as resistors, inductors, capacitors, diodes, switches, transistors, or integrated circuits. The term does not include structural or mechanical parts of an assembly containing an electronic component, and does not include any high performance magnets that may be used in the electronic component.
                                </P>
                                <P>
                                    <E T="03">End item</E>
                                     means the final production product when assembled or completed and ready for delivery under a line item of this contract.
                                </P>
                                <P>
                                    <E T="03">High performance magnet</E>
                                     means a permanent magnet that obtains a majority of its magnetic properties from rare earth metals (such as samarium).
                                </P>
                                <P>
                                    <E T="03">Produce</E>
                                     means—
                                </P>
                                <P>(i) Atomization;</P>
                                <P>(ii) Sputtering; or</P>
                                <P>(iii) Final consolidation of non-melt derived metal powders.</P>
                                <P>
                                    <E T="03">Qualifying country</E>
                                     means any country listed in the definition of “Qualifying country” at 225.003 of the Defense Federal Acquisition Regulation Supplement (DFARS).
                                </P>
                                <P>
                                    <E T="03">Specialty metal</E>
                                     means—
                                </P>
                                <P>(i) Steel—</P>
                                <P>(A) With a maximum alloy content exceeding one or more of the following limits: Manganese, 1.65 percent; silicon, 0.60 percent; or copper, 0.60 percent; or</P>
                                <P>(B) Containing more than 0.25 percent of any of the following elements: Aluminum, chromium, cobalt, molybdenum, nickel, niobium (columbium), titanium, tungsten, or vanadium;</P>
                                <P>(ii) Metal alloys consisting of—</P>
                                <P>
                                    (A) Nickel or iron-nickel alloys that contain a total of alloying metals other than nickel and iron in excess of 10 percent; or
                                    <PRTPAGE P="520"/>
                                </P>
                                <P>(B) Cobalt alloys that contain a total of alloying metals other than cobalt and iron in excess of 10 percent;</P>
                                <P>(iii) Titanium and titanium alloys; or</P>
                                <P>(iv) Zirconium and zirconium alloys.</P>
                                <P>
                                    <E T="03">Steel</E>
                                     means an iron alloy that includes between .02 and 2 percent carbon and may include other elements.
                                </P>
                                <P>
                                    <E T="03">Subsystem</E>
                                     means a functional grouping of items that combine to perform a major function within an end item, such as electrical power, attitude control, and propulsion.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Restriction.</E>
                                     Except as provided in paragraph (c) of this clause, any specialty metals incorporated in items delivered under this contract shall be melted or produced in the United States, its outlying areas, or a qualifying country.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Exceptions.</E>
                                     The restriction in paragraph (b) of this clause does not apply to—
                                </P>
                                <P>(1) Electronic components.</P>
                                <P>(2)(i) Commercially available off-the-shelf (COTS) items, other than—</P>
                                <P>(A) Specialty metal mill products, such as bar, billet, slab, wire, plate, or sheet, that have not been incorporated into COTS end items, subsystems, assemblies, or components;</P>
                                <P>(B) Forgings or castings of specialty metals, unless the forgings or castings are incorporated into COTS end items, subsystems, or assemblies;</P>
                                <P>(C) Commercially available high performance magnets that contain specialty metal, unless such high performance magnets are incorporated into COTS end items or subsystems; and</P>
                                <P>(D) COTS fasteners, unless—</P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) The fasteners are incorporated into COTS end items, subsystems, assemblies, or components; or
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) The fasteners qualify for the commercial product  exception in paragraph (c)(3) of this clause.
                                </P>
                                <P>(ii) A COTS item is considered to be “without modification” if it is not modified prior to contractual acceptance by the next higher tier in the supply chain.</P>
                                <P>
                                    (A) Specialty metals in a COTS item that was accepted without modification by the next higher tier are excepted from the restriction in paragraph (b) of this clause, and remain excepted, even if a piece of the COTS item subsequently is removed (
                                    <E T="03">e.g.,</E>
                                     the end is removed from a COTS screw or an extra hole is drilled in a COTS bracket).
                                </P>
                                <P>
                                    (B) Specialty metals that were not contained in a COTS item upon acceptance, but are added to the COTS item after acceptance, are subject to the restriction in paragraph (b) of this clause (
                                    <E T="03">e.g.</E>
                                    , a special reinforced handle made of specialty metal is added to a COTS item).
                                </P>
                                <P>
                                    (C) If two or more COTS items are combined in such a way that the resultant item is not a COTS item, only the specialty metals involved in joining the COTS items together are subject to the restriction in paragraph (b) of this clause (
                                    <E T="03">e.g.</E>
                                    , a COTS aircraft is outfitted with a COTS engine that is not the COTS engine normally provided with the aircraft).
                                </P>
                                <P>
                                    (D) For COTS items that are normally sold in the commercial marketplace with various options, items that include such options are also COTS items. However, if a COTS item is offered to the Government with an option that is not normally offered in the commercial marketplace, that option is subject to the restriction in paragraph (b) of this clause (
                                    <E T="03">e.g. </E>
                                     An aircraft is normally sold to the public with an option for installation kits. The Department of Defense requests a military-unique kit. The aircraft is still a COTS item, but the military-unique kit is not a COTS item and must comply with the restriction in paragraph (b) of this clause unless another exception applies).
                                </P>
                                <P>(3) Fasteners that are commercial products, if the manufacturer of the fasteners certifies it will purchase, during the relevant calendar year, an amount of domestically melted or produced specialty metal, in the required form, for use in the production of fasteners for sale to the Department of Defense and other customers, that is not less than 50 percent of the total amount of the specialty metal that it will purchase to carry out the production of such fasteners for all customers.</P>
                                <P>(4) Items manufactured in a qualifying country.</P>
                                <P>(5) Specialty metals for which the Government has determined in accordance with DFARS 225.7003-3 that specialty metal melted or produced in the United States, its outlying areas, or a qualifying country cannot be acquired as and when needed in—</P>
                                <P>(i) A satisfactory quality;</P>
                                <P>(ii) A sufficient quantity; and</P>
                                <P>(iii) The required form. In accordance with 10 U.S.C. 4863(m)(4), the term “required form” in this clause refers to the form of the mill product, such as bar, billet, wire, slab, plate, or sheet, in the grade appropriate for the production of a finished end item to be delivered to the Government under this contract; or a finished component assembled into an end item to be delivered to the Government under this contract.</P>
                                <P>
                                    (6) End items containing a minimal amount of otherwise noncompliant specialty metals (
                                    <E T="03">i.e.</E>
                                    , specialty metals not melted or produced in the United States, an outlying area, or a qualifying country, that are not covered by one of the other exceptions in this paragraph (c)), if the total weight of such noncompliant metals does not exceed 2 percent of the total weight of all specialty metals in the end item, as estimated in good faith by the Contractor. This exception does not apply to high performance magnets containing specialty metals.
                                    <PRTPAGE P="521"/>
                                </P>
                                <P>
                                    (d) 
                                    <E T="03">Compliance for commercial derivative military articles.</E>
                                     (1) As an alternative to the compliance required in paragraph (b) of this clause, the Contractor may purchase an amount of domestically melted or produced specialty metals in the required form, for use during the period of contract performance in the production of the commercial derivative military article and the related commercial article, if—
                                </P>
                                <P>(i) The Contracting Officer has notified the Contractor of the items to be delivered under this contract that have been determined by the Government to meet the definition of “commercial derivative military article”; and</P>
                                <P>(ii) For each item that has been determined by the Government to meet the definition of “commercial derivative military article,” the Contractor has certified, as specified in the provision of the solicitation entitled “Commercial Derivative Military Article—Specialty Metals Compliance Certificate” (DFARS 252.225-7010), that the Contractor and its subcontractor(s) will enter into a contractual agreement or agreements to purchase an amount of domestically melted or produced specialty metal in the required form, for use during the period of contract performance in the production of each commercial derivative military article and the related commercial article, that is not less than the Contractor's good faith estimate of the greater of—</P>
                                <P>(A) An amount equivalent to 120 percent of the amount of specialty metal that is required to carry out the production of the commercial derivative military article (including the work performed under each subcontract); or</P>
                                <P>(B) An amount equivalent to 50 percent of the amount of specialty metal that will be purchased by the Contractor and its subcontractors for use during such period in the production of the commercial derivative military article and the related commercial article.</P>
                                <P>(2) For the purposes of this alternative, the amount of specialty metal that is required to carry out production of the commercial derivative military article includes specialty metal contained in any item, including COTS items.</P>
                                <P>
                                    (e) 
                                    <E T="03">Subcontracts.</E>
                                     (1) The Contractor shall exclude and reserve paragraph (d) and this paragraph (e)(1) when flowing down this clause to subcontracts.
                                </P>
                                <P>(2) The Contractor shall insert paragraphs (a) through (c) and this paragraph (e)(2) of this clause in subcontracts, including subcontracts for commercial products, that are for items containing specialty metals to ensure compliance of the end products that the Contractor will deliver to the Government. When inserting this clause in subcontracts, the Contractor shall—</P>
                                <P>(i) Modify paragraph (c)(6) of this clause only as necessary to facilitate management of the minimal content exception at the prime contract level. The minimal content exception does not apply to specialty metals contained in high-performance magnets; and</P>
                                <P>(ii) Not further alter the clause other than to identify the appropriate parties.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[74 FR 37639, July 29, 2009, as amended at 76 FR 3538, Jan. 20, 2011; 77 FR 35882, June 15, 2012; 78 FR 18879, Mar. 28, 2013; 78 FR 37990, June 25, 2013; 79 FR 61585, Oct. 14, 2014; 84 FR 72244, Dec. 31, 2019; 87 FR 76997, Dec. 16, 2022; 88 FR 6591, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7010</SECTNO>
                            <SUBJECT>Commercial Derivative Military Article—Specialty Metals Compliance Certificate.</SUBJECT>
                            <P>As prescribed in 225.7003-5(b), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Commercial Derivative Military Article—Specialty Metals Compliance Certificate (JUL 2009)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     
                                    <E T="03">Commercial derivative military article,</E>
                                     
                                    <E T="03">commercially available off-the-shelf item,</E>
                                     
                                    <E T="03">produce,</E>
                                     
                                    <E T="03">required form,</E>
                                     and 
                                    <E T="03">specialty metal,</E>
                                     as used in this provision, have the meanings given in the clause of this solicitation entitled “Restriction on Acquisition of Certain Articles Containing Specialty Metals” (DFARS 252.225-7009).
                                </P>
                                <P>(b) The offeror shall list in this paragraph any commercial derivative military articles it intends to deliver under any contract resulting from this solicitation using the alternative compliance for commercial derivative military articles, as specified in paragraph (d) of the clause of this solicitation entitled “Restriction on Acquisition of Certain Articles Containing Specialty Metals” (DFARS 252.225-7009). The offeror's designation of an item as a “commercial derivative military article” will be subject to Government review and approval.</P>
                                <FP SOURCE="FP-DASH"/>
                                <FP SOURCE="FP-DASH"/>
                                <P>
                                    (c) If the offeror has listed any commercial derivative military articles in paragraph (b) of this provision, the offeror certifies that, if awarded a contract as a result of this solicitation, and if the Government approves the designation of the listed item(s) as commercial derivative military articles, the offeror and its subcontractor(s) will demonstrate that individually or collectively they have entered into a contractual agreement or agreements to purchase an amount of domestically melted or produced specialty metal in the required form, for use during the period of contract performance in the production of each commercial derivative military article and the related commercial article, that is 
                                    <PRTPAGE P="522"/>
                                    not less than the Contractor's good faith estimate of the greater of—
                                </P>
                                <P>(1) An amount equivalent to 120 percent of the amount of specialty metal that is required to carry out the production of the commercial derivative military article (including the work performed under each subcontract); or</P>
                                <P>(2) An amount equivalent to 50 percent of the amount of specialty metal that will be purchased by the Contractor and its subcontractors for use during such period in the production of the commercial derivative military article and the related commercial article.</P>
                                <P>(d) For the purposes of this provision, the amount of specialty metal that is required to carry out the production of the commercial derivative military article includes specialty metal contained in any item, including commercially available off-the-shelf items, incorporated into such commercial derivative military articles.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[74 FR 37639, July 29, 2009]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7011</SECTNO>
                            <SUBJECT>Restriction on acquisition of supercomputers.</SUBJECT>
                            <P>As prescribed in 225.7012-3, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Restriction on Acquisition of Supercomputers (JUN 2005)</HD>
                                <P>Supercomputers delivered under this contract shall be manufactured in the United States or its outlying areas.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[70 FR 35547, June 21, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7012</SECTNO>
                            <SUBJECT>Preference for Certain Domestic Commodities.</SUBJECT>
                            <P>As prescribed in 225.7002-3(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Preference for Certain Domestic Commodities (APR 2022)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Component</E>
                                     means any item supplied to the Government as part of an end product or of another component.
                                </P>
                                <P>
                                    <E T="03">End product</E>
                                     means supplies delivered under a line item of this contract.
                                </P>
                                <P>
                                    <E T="03">Qualifying country</E>
                                     means a country with a reciprocal defense procurement memorandum of understanding or international agreement with the United States in which both countries agree to remove barriers to purchases of supplies produced in the other country or services performed by sources of the other country, and the memorandum or agreement complies, where applicable, with the requirements of section 36 of the Arms Export Control Act (22 U.S.C. 2776) and with 10 U.S.C. 2457. Accordingly, the following are qualifying countries:
                                </P>
                                <SCOL2>
                                    <LI>Australia</LI>
                                    <LI>Austria</LI>
                                    <LI>Belgium</LI>
                                    <LI>Canada</LI>
                                    <LI>Czech Republic</LI>
                                    <LI>Denmark</LI>
                                    <LI>Egypt</LI>
                                    <LI>Estonia</LI>
                                    <LI>Finland</LI>
                                    <LI>France</LI>
                                    <LI>Germany</LI>
                                    <LI>Greece</LI>
                                    <LI>Israel</LI>
                                    <LI>Italy</LI>
                                    <LI>Japan</LI>
                                    <LI>Latvia</LI>
                                    <LI>Lithuania</LI>
                                    <LI>Luxembourg</LI>
                                    <LI>Netherlands</LI>
                                    <LI>Norway</LI>
                                    <LI> Poland</LI>
                                    <LI>Portugal</LI>
                                    <LI>Slovenia</LI>
                                    <LI>Spain</LI>
                                    <LI>Sweden</LI>
                                    <LI>Switzerland</LI>
                                    <LI>Turkey</LI>
                                    <LI>United Kingdom of Great Britain and Northern Ireland.</LI>
                                </SCOL2>
                                <P>
                                    <E T="03">Structural component of a tent</E>
                                    —
                                </P>
                                <P>(1) Means a component that contributes to the form and stability of the tent (e.g., poles, frames, flooring, guy ropes, pegs); and</P>
                                <P>(2) Does not include equipment such as heating, cooling, or lighting.</P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>
                                    <E T="03">U.S.-flag vessel</E>
                                     means a vessel of the United States or belonging to the United States, including any vessel registered or having national status under the laws of the United States.
                                </P>
                                <P>(b) The Contractor shall deliver under this contract only such of the following items, either as end products or components, that have been grown, reprocessed, reused, or produced in the United States:</P>
                                <P>(1) Food.</P>
                                <P>(2) Clothing and the materials and components thereof, other than sensors, electronics, or other items added to, and not normally associated with, clothing and the materials and components thereof. Clothing includes items such as outerwear, headwear, underwear, nightwear, footwear, hosiery, handwear, belts, badges, and insignia.</P>
                                <P>(3)(i) Tents and structural components of tents;</P>
                                <P>(ii) Tarpaulins; or</P>
                                <P>(iii) Covers.</P>
                                <P>(4) Cotton and other natural fiber products.</P>
                                <P>(5) Woven silk or woven silk blends.</P>
                                <P>(6) Spun silk yarn for cartridge cloth.</P>
                                <P>(7) Synthetic fabric, and coated synthetic fabric, including all textile fibers and yarns that are for use in such fabrics.</P>
                                <P>(8) Canvas products.</P>
                                <P>(9) Wool (whether in the form of fiber or yarn or contained in fabrics, materials, or manufactured articles).</P>
                                <P>(10) Any item of individual equipment (Federal Supply Class 8465) manufactured from or containing fibers, yarns, fabrics, or materials listed in this paragraph (b).</P>
                                <P>
                                    (c) This clause does not apply—
                                    <PRTPAGE P="523"/>
                                </P>
                                <P>(1) To items listed in section 25.104(a) of the Federal Acquisition Regulation, or other items for which the Government has determined that a satisfactory quality and sufficient quantity cannot be acquired as and when needed at U.S. market prices;</P>
                                <P>(2) To incidental amounts of cotton, other natural fibers, or wool incorporated in an end product, for which the estimated value of the cotton, other natural fibers, or wool—</P>
                                <P>(i) Is not more than 10 percent of the total price of the end product; and</P>
                                <P>(ii) Does not exceed the threshold at Defense Federal Acquisition Regulation Supplement 225.7002-2(a);</P>
                                <P>(3) To waste and byproducts of cotton or wool fiber for use in the production of propellants and explosives;</P>
                                <P>(4) To foods, other than fish, shellfish, or seafood, that have been manufactured or processed in the United States, regardless of where the foods (and any component if applicable) were grown or produced. Fish, shellfish, or seafood manufactured or processed in the United States and fish, shellfish, or seafood contained in foods manufactured or processed in the United States shall be provided in accordance with paragraph (d) of this clause;</P>
                                <P>(5) To chemical warfare protective clothing produced in a qualifying country; or</P>
                                <P>(6) To fibers and yarns that are for use in synthetic fabric or coated synthetic fabric (but does apply to the synthetic or coated synthetic fabric itself), if—</P>
                                <P>(i) The fabric is to be used as a component of an end product that is not a textile product. Examples of textile products, made in whole or in part of fabric, include—</P>
                                <P>(A) Draperies, floor coverings, furnishings, and bedding (Federal Supply Group 72, Household and Commercial Furnishings and Appliances);</P>
                                <P>(B) Items made in whole or in part of fabric in Federal Supply Group 83, Textile/leather/furs/apparel/findings/ tents/flags, or Federal Supply Group 84, Clothing, Individual Equipment and Insignia;</P>
                                <P>(C) Upholstered seats (whether for household, office, or other use); and</P>
                                <P>(D) Parachutes (Federal Supply Class 1670); or</P>
                                <P>(ii) The fibers and yarns are para-aramid fibers and continuous filament para-aramid yarns manufactured in a qualifying country.</P>
                                <P>(d)(1) Fish, shellfish, and seafood delivered under this contract, or contained in foods delivered under this contract—</P>
                                <P>(i) Shall be taken from the sea by U.S.-flag vessels; or</P>
                                <P>(ii) If not taken from the sea, shall be obtained from fishing within the United States; and</P>
                                <P>(2) Any processing or manufacturing of the fish, shellfish, or seafood shall be performed on a U.S.-flag vessel or in the United States.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[67 FR 20698, Apr. 26, 2002, as amended at 68 FR 7442, Feb. 14, 2003; 69 FR 26509, May 13, 2004; 69 FR 31910, June 8, 2004; 72 FR 2638, Jan. 22, 2007; 73 FR 11356, Mar. 3, 2008; 73 FR 76971, Dec. 18, 2008; 75 FR 34945, June 21, 2010; 77 FR 38736, 38737, June 29, 2012; 77 FR 76942, Dec. 31, 2012; 78 FR 13546, Feb. 28, 2013; 81 FR 50651, Aug. 2, 2016; 81 FR 93841, Dec. 22, 2016; 82 FR 61484, Dec. 28, 2017; 87 FR 15816, Mar. 18, 2022; 87 FR 25147, Apr. 28, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7013</SECTNO>
                            <SUBJECT>Duty-Free Entry.</SUBJECT>
                            <P>As prescribed in 225.1101(4), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Duty-Free Entry (NOV 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>“Component” means any item supplied to the Government as part of an end product or of another component.</P>
                                <P>
                                    <E T="03">Customs territory of the United States</E>
                                     means the 50 States, the District of Columbia, and Puerto Rico.
                                </P>
                                <P>
                                    <E T="03">Eligible product</E>
                                     means—
                                </P>
                                <P>
                                    (1) 
                                    <E T="03">Designated country end product,</E>
                                     as defined in the Trade Agreements (either basic or alternate) clause of this contract;
                                </P>
                                <P>
                                    (2) 
                                    <E T="03">Free Trade Agreement country end product,</E>
                                     other than a 
                                    <E T="03">Bahraini end product,</E>
                                     a 
                                    <E T="03">Moroccan end product,</E>
                                     a 
                                    <E T="03">Panamanian end product,</E>
                                     or a 
                                    <E T="03">Peruvian end product,</E>
                                     as defined in the Buy American—Free Trade Agreements—Balance of Payments Program (either basic or alternate II) clause of this contract; or
                                </P>
                                <P>
                                    (3) 
                                    <E T="03">Free Trade Agreement country end product</E>
                                     other than a 
                                    <E T="03">Bahraini end product, Korean end product,</E>
                                     
                                    <E T="03">Moroccan end product, Panamanian end product,</E>
                                     or 
                                    <E T="03">Peruvian end product,</E>
                                     as defined in the Buy American—Free Trade Agreements—Balance of Payments Program (either alternate IV or alternate V) clause of this contract.
                                </P>
                                <P>
                                    <E T="03">Qualifying country</E>
                                     and 
                                    <E T="03">qualifying country end product</E>
                                     have the meanings given in the Trade Agreements clause, the Buy American and Balance of Payments Program clause, or the Buy American —Free Trade Agreements—Balance of Payments Program clause of this contract, basic or alternate.
                                </P>
                                <P>(b) Except as provided in paragraph (i) of this clause, or unless supplies were imported into the customs territory of the United States before the date of this contract or the applicable subcontract, the price of this contract shall not include any amount for duty on—</P>
                                <P>(1) End items that are eligible products or qualifying country end products;</P>
                                <P>
                                    (2) Components (including, without limitation, raw materials and intermediate assemblies) produced or made in qualifying countries, that are to be incorporated in U.S.-
                                    <PRTPAGE P="524"/>
                                    made end products to be delivered under this contract; or
                                </P>
                                <P>(3) Other supplies for which the Contractor estimates that duty will exceed $300 per shipment into the customs territory of the United States.</P>
                                <P>(c) The Contractor shall—</P>
                                <P>(1) Claim duty-free entry only for supplies that the Contractor intends to deliver to the Government under this contract, either as end items or components of end items; and</P>
                                <P>(2) Pay duty on supplies, or any portion thereof, that are diverted to nongovernmental use, other than—</P>
                                <P>(i) Scrap or salvage; or</P>
                                <P>(ii) Competitive sale made, directed, or authorized by the Contracting Officer.</P>
                                <P>(d) Except as the Contractor may otherwise agree, the Government will execute duty-free entry certificates and will afford such assistance as appropriate to obtain the duty-free entry of supplies—</P>
                                <P>(1) For which no duty is included in the contract price in accordance with paragraph (b) of this clause; and</P>
                                <P>(2) For which shipping documents bear the notation specified in paragraph (e) of this clause.</P>
                                <P>(e) For foreign supplies for which the Government will issue duty-free entry certificates in accordance with this clause, shipping documents submitted to Customs shall—</P>
                                <P>(1) Consign the shipments to the appropriate—</P>
                                <P>(i) Military department in care of the Contractor, including the Contractor's delivery address; or</P>
                                <P>(ii) Military installation; and</P>
                                <P>(2) Include the following information:</P>
                                <P>(i) Prime contract number and, if applicable, delivery order number.</P>
                                <P>(ii) Number of the subcontract for foreign supplies, if applicable.</P>
                                <P>(iii) Identification of the carrier.</P>
                                <P>(iv)(A) For direct shipments to a U.S. military installation, the notation: “UNITED STATES GOVERNMENT, DEPARTMENT OF DEFENSE Duty-Free Entry to be claimed pursuant to Section XXII, Chapter 98, Subchapter VIII, Item 9808.00.30 of the Harmonized Tariff Schedule of the United States. Upon arrival of shipment at the appropriate port of entry, District Director of Customs, please release shipment under 19 CFR part 142 and notify Commander, Defense Contract Management Agency (DCMA), St. Louis, MO, ATTN: Duty Free Entry Team, 1222 Spruce Street, Room 9.300, St. Louis, MO 63103-2812, for execution of Customs Form 7501, 7501A, or 7506 and any required duty-free entry certificates.”</P>
                                <P>
                                    (B) If the shipment will be consigned to other than a military installation, 
                                    <E T="03">e.g.,</E>
                                     a domestic contractor's plant, the shipping document notation shall be altered to include the name and address of the contractor, agent, or broker who will notify Commander, DCMA New York, for execution of the duty-free entry certificate. (If the shipment will be consigned to a contractor's plant and no duty-free entry certificate is required due to a trade agreement, the Contractor shall claim duty-free entry under the applicable trade agreement and shall comply with the U.S. Customs Service requirements. No notification to Commander, DCMA New York, is required.)
                                </P>
                                <P>(v) Gross weight in pounds (if freight is based on space tonnage, state cubic feet in addition to gross shipping weight).</P>
                                <P>(vi) Estimated value in U.S. dollars.</P>
                                <P>
                                    (vii) Activity address number of the contract administration office administering the prime contract, 
                                    <E T="03">e.g.,</E>
                                     for DCMA Dayton, S3605A.
                                </P>
                                <P>
                                    (f) 
                                    <E T="03">Preparation of customs forms.</E>
                                     (1)(i) Except for shipments consigned to a military installation, the Contractor shall—
                                </P>
                                <P>(A) Prepare any customs forms required for the entry of foreign supplies into the customs territory of the United States in connection with this contract; and</P>
                                <P>(B) Submit the completed customs forms to the District Director of Customs, with a copy to DCMA NY for execution of any required duty-free entry certificates.</P>
                                <P>(ii) Shipments consigned directly to a military installation will be released in accordance with sections 10.101 and 10.102 of the U.S. Customs regulations.</P>
                                <P>(2) For shipments containing both supplies that are to be accorded duty-free entry and supplies that are not, the Contractor shall identify on the customs forms those items that are eligible for duty-free entry.</P>
                                <P>(g) The Contractor shall—</P>
                                <P>(1) Prepare (if the Contractor is a foreign supplier), or shall instruct the foreign supplier to prepare, a sufficient number of copies of the bill of lading (or other shipping document) so that at least two of the copies accompanying the shipment will be available for use by the District Director of Customs at the port of entry;</P>
                                <P>(2) Consign the shipment as specified in paragraph (e) of this clause; and</P>
                                <P>(3) Mark on the exterior of all packages—</P>
                                <P>(i) “UNITED STATES GOVERNMENT, DEPARTMENT OF DEFENSE”; and</P>
                                <P>(ii) The activity address number of the contract administration office administering the prime contract.</P>
                                <P>
                                    (h) The Contractor shall notify the Administrative Contracting Officer (ACO) in writing of any purchase of eligible products or qualifying country supplies to be accorded duty-free entry, that are to be imported into the customs territory of the United States for delivery to the Government or for incorporation in end items to be delivered to the Government. The Contractor shall furnish the notice to the ACO immediately upon 
                                    <PRTPAGE P="525"/>
                                    award to the supplier and shall include in the notice—
                                </P>
                                <P>(1) The Contractor's name, address, and Commercial and Government Entity (CAGE) code;</P>
                                <P>(2) Prime contract number and, if applicable, delivery order number;</P>
                                <P>(3) Total dollar value of the prime contract or delivery order;</P>
                                <P>(4) Date of the last scheduled delivery under the prime contract or delivery order;</P>
                                <P>(5) Foreign supplier's name and address;</P>
                                <P>(6) Number of the subcontract for foreign supplies;</P>
                                <P>(7) Total dollar value of the subcontract for foreign supplies;</P>
                                <P>(8) Date of the last scheduled delivery under the subcontract for foreign supplies;</P>
                                <P>(9) List of items purchased;</P>
                                <P>(10) An agreement that the Contractor will pay duty on supplies, or any portion thereof, that are diverted to nongovernmental use other than—</P>
                                <P>(i) Scrap or salvage; or</P>
                                <P>(ii) Competitive sale made, directed, or authorized by the Contracting Officer;</P>
                                <P>(11) Country of origin; and</P>
                                <P>(12) Scheduled delivery date(s).</P>
                                <P>(i) This clause does not apply to purchases of eligible products or qualifying country supplies in connection with this contract if—</P>
                                <P>(1) The supplies are identical in nature to supplies purchased by the Contractor or any subcontractor in connection with its commercial business; and</P>
                                <P>(2) It is not economical or feasible to account for such supplies so as to ensure that the amount of the supplies for which duty-free entry is claimed does not exceed the amount purchased in connection with this contract.</P>
                                <P>(j) The Contractor shall—</P>
                                <P>(1) Insert the substance of this clause, including this paragraph (j), in all subcontracts for—</P>
                                <P>(i) Qualifying country components; or</P>
                                <P>(ii) Nonqualifying country components for which the Contractor estimates that duty will exceed $200 per unit;</P>
                                <P>(2) Require subcontractors to include the number of this contract on all shipping documents submitted to Customs for supplies for which duty-free entry is claimed pursuant to this clause; and</P>
                                <P>(3) Include in applicable subcontracts—</P>
                                <P>(i) The name and address of the ACO for this contract;</P>
                                <P>(ii) The name, address, and activity address number of the contract administration office specified in this contract; and</P>
                                <P>(iii) The information required by paragraphs (h)(1), (2), and (3) of this clause.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[68 FR 15635, Mar. 31, 2003, as amended at 69 FR 1928, Jan. 13, 2004; 70 FR 2363, Jan. 13, 2005; 70 FR 35547, June 21, 2005; 71 FR 34835, June 16, 2006; 71 FR 58542, Oct. 4, 2006; 74 FR 68384, Dec. 24, 2009; 77 FR 35882, June 15, 2012; 78 FR 65222, Oct. 31, 2013; 79 FR 65820, Nov. 5, 2014; 81 FR 28732, May 10, 2016; 85 FR 19681, Apr. 8, 2020; 85 FR 34536, June 5, 2020; 87 FR 15819, Mar. 18, 2022; 87 FR 76986, Dec. 16, 2022; 88 FR 80467, Nov. 17, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7014</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7015</SECTNO>
                            <SUBJECT>Restriction on acquisition of hand or measuring tools.</SUBJECT>
                            <P>As prescribed in 225.7002-3(b), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Restriction on Acquisition of Hand or Measuring Tools (JUN 2005)</HD>
                                <P>Hand or measuring tools delivered under this contract shall be produced in the United States or its outlying areas.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[70 FR 35547, June 21, 2005, as amended at 74 FR 37641, July 29, 2009]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7016</SECTNO>
                            <SUBJECT>Restriction on Acquisition of Ball and Roller Bearings.</SUBJECT>
                            <P>As prescribed in 225.7009-5, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Restriction on Acquisition of Ball and Roller Bearings (JAN 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    (1) 
                                    <E T="03">Bearing component</E>
                                     means the bearing element, retainer, inner race, or outer race.
                                </P>
                                <P>
                                    (2) 
                                    <E T="03">Component,</E>
                                     other than a bearing component, means any item supplied to the Government as part of an end product or of another component.
                                </P>
                                <P>
                                    (3) 
                                    <E T="03">End product</E>
                                     means supplies delivered under a line item of this contract.
                                </P>
                                <P>(b) Except as provided in paragraph (c) of this clause—</P>
                                <P>(1) Each ball and roller bearing delivered under this contract shall be manufactured in the United States, its outlying areas, or Canada; and</P>
                                <P>(2) For each ball or roller bearing, the cost of the bearing components manufactured in the United States, its outlying areas, or Canada shall exceed 50 percent of the total cost of the bearing components of that ball or roller bearing.</P>
                                <P>(c) The restriction in paragraph (b) of this clause does not apply to ball or roller bearings that are acquired as—</P>
                                <P>
                                    (1) Commercial components of an other than commercial end product; or
                                    <PRTPAGE P="526"/>
                                </P>
                                <P>(2) Commercial or other than commercial components of a commercial component of an other than commercial end product.</P>
                                <P>(d) The restriction in paragraph (b) of this clause may be waived upon request from the Contractor in accordance with subsection 225.7009-4 of the Defense Federal Acquisition Regulation Supplement.</P>
                                <P>(e) If this contract includes DFARS clause 252.225-7009, Restriction on Acquisition of Certain Articles Containing Specialty Metals, all bearings that contain specialty metals, as defined in that clause, must meet the requirements of that clause.</P>
                                <P>
                                    (f) 
                                    <E T="03">Subcontracts.</E>
                                     The Contractor shall insert the substance of this clause, including this paragraph (f), in all subcontracts, except those for—
                                </P>
                                <P>(1) Commercial products; or</P>
                                <P>(2) Items that do not contain ball or roller bearings.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[75 FR 76300, Dec. 8, 2010, as amended at 76 FR 32843, June 6, 2011; 88 FR 6591, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7017</SECTNO>
                            <SUBJECT>Photovoltaic Devices.</SUBJECT>
                            <P>As prescribed in 225.7017-4(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Photovoltaic Devices (MAR 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Bahraini photovoltaic device</E>
                                     means a photovoltaic device that—
                                </P>
                                <P>(1) Is wholly manufactured in Bahrain; or</P>
                                <P>(2) In the case of a photovoltaic device that consists in whole or in part of materials from another country, has been substantially transformed in Bahrain into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed, provided that the photovoltaic device is not subsequently substantially transformed outside of Bahrain.</P>
                                <P>
                                    <E T="03">Caribbean Basin country photovoltaic device</E>
                                     means a photovoltaic device that—
                                </P>
                                <P>(1) Is wholly manufactured in a Caribbean Basin country; or</P>
                                <P>(2) In the case of a photovoltaic device that consists in whole or in part of materials from another country, has been substantially transformed in a Caribbean Basin country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed, provided that the photovoltaic device is not subsequently substantially transformed outside of a Caribbean Basin country.</P>
                                <P>
                                    <E T="03">Designated country</E>
                                     means—
                                </P>
                                <P>(1) A World Trade Organization Government Procurement Agreement (WTO GPA) country (Armenia, Aruba, Australia, Austria, Belgium, Bulgaria, Canada, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hong Kong, Hungary, Iceland, Ireland, Israel, Italy, Japan, Korea (Republic of), Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Moldova, Montenegro, Netherlands, New Zealand, North Macedonia, Norway, Poland, Portugal, Romania, Singapore, Slovak Republic, Slovenia, Spain, Sweden, Switzerland, Taiwan (known in the World Trade Organization as “the Separate Customs Territory of Taiwan, Penghu, Kinmen, and Matsu” (Chinese Taipei)), Ukraine, or the United Kingdom);</P>
                                <P>(2) A Free Trade Agreement country (Australia, Bahrain, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua, Panama, Peru, or Singapore);</P>
                                <P>(3) A least developed country (Afghanistan, Angola, Bangladesh, Benin, Bhutan, Burkina Faso, Burundi, Cambodia, Central African Republic, Chad, Comoros, Democratic Republic of Congo, Djibouti, Equatorial Guinea, Eritrea, Ethiopia, Gambia, Guinea, Guinea-Bissau, Haiti, Kiribati, Laos, Lesotho, Liberia, Madagascar, Malawi, Mali, Mauritania, Mozambique, Nepal, Niger, Rwanda, Samoa, Sao Tome and Principe, Senegal, Sierra Leone, Solomon Islands, Somalia, South Sudan, Tanzania, Timor-Leste, Togo, Tuvalu, Uganda, Vanuatu, Yemen, or Zambia); or</P>
                                <P>(4) A Caribbean Basin country (Antigua and Barbuda, Aruba, Bahamas, Barbados, Belize, Bonaire, British Virgin Islands, Curacao, Dominica, Grenada, Guyana, Haiti, Jamaica, Montserrat, Saba, St. Kitts and Nevis, St. Lucia, St. Vincent and the Grenadines, Sint Eustatius, Sint Maarten, or Trinidad and Tobago).</P>
                                <P>
                                    <E T="03">Designated country photovoltaic device</E>
                                     means a WTO GPA country photovoltaic device, a Free Trade Agreement country photovoltaic device, a least developed country photovoltaic device, or a Caribbean Basin country photovoltaic device.
                                </P>
                                <P>
                                    <E T="03">Domestic photovoltaic device</E>
                                     means a photovoltaic device that is manufactured in the United States.
                                </P>
                                <P>
                                    <E T="03">Foreign photovoltaic device</E>
                                     means a photovoltaic device other than a domestic photovoltaic device.
                                </P>
                                <P>
                                    <E T="03">Free Trade Agreement country</E>
                                     means Australia, Bahrain, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua, Panama, Peru, or Singapore.
                                </P>
                                <P>
                                    <E T="03">Free Trade Agreement country photovoltaic device</E>
                                     means a photovoltaic device that—
                                </P>
                                <P>(1) Is wholly manufactured in a Free Trade Agreement country; or</P>
                                <P>
                                    (2) In the case of a photovoltaic device that consists in whole or in part of materials 
                                    <PRTPAGE P="527"/>
                                    from another country, has been substantially transformed in a Free Trade Agreement country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed, provided that the photovoltaic device is not subsequently substantially transformed outside of a Free Trade Agreement country.
                                </P>
                                <P>
                                    <E T="03">Korean photovoltaic device</E>
                                     means a photovoltaic device that—
                                </P>
                                <P>(1) Is wholly manufactured in Korea; or</P>
                                <P>(2) In the case of a photovoltaic device that consists in whole or in part of materials from another country, has been substantially transformed in Korea (Republic of) into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed, provided that the photovoltaic device is not subsequently substantially transformed outside of Korea (Republic of).</P>
                                <P>
                                    <E T="03">Least developed country photovoltaic device</E>
                                     means a photovoltaic device that—
                                </P>
                                <P>(1) Is wholly manufactured in a least developed country; or</P>
                                <P>(2) In the case of a photovoltaic device thatconsists in whole or in part of materials from another country, has been substantially transformed in a least developed country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed, provided that the photovoltaic device is not subsequently substantially transformed outside of a least developed country.</P>
                                <P>
                                    <E T="03">Moroccan photovoltaic device</E>
                                     means a photovoltaic device that—
                                </P>
                                <P>(1) Is wholly manufactured in Morocco; or</P>
                                <P>(2) In the case of a photovoltaic device that consists in whole or in part of materials from another country, has been substantially transformed in Morocco into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed, provided that the photovoltaic device is not subsequently substantially transformed outside of Morocco.</P>
                                <P>
                                    <E T="03">Panamanian photovoltaic device</E>
                                     means a photovoltaic device that—
                                </P>
                                <P>(1) Is wholly manufactured in Panama; or</P>
                                <P>(2) In the case of a photovoltaic device that consists in whole or in part of materials from another country, has been substantially transformed in Panama into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed, provided that the photovoltaic device is not subsequently substantially transformed outside of Panama.</P>
                                <P>
                                    <E T="03">Peruvian photovoltaic device</E>
                                     means a photovoltaic device that—
                                </P>
                                <P>(1) Is wholly manufactured in Peru; or</P>
                                <P>(2) In the case of a photovoltaic device that consists in whole or in part of materials from another country, has been substantially transformed in Peru into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed, provided that the photovoltaic device is not subsequently substantially transformed outside of Peru.</P>
                                <P>
                                    <E T="03">Photovoltaic device</E>
                                     means a device that converts light directly into electricity through a solid-state, semiconductor process.
                                </P>
                                <P>
                                    <E T="03">Qualifying country</E>
                                     means a country with a reciprocal defense procurement memorandum of understanding or international agreement with the United States in which both countries agree to remove barriers to purchases of supplies produced in the other country or services performed by sources of the other country, and the memorandum or agreement complies, where applicable, with the requirements of section 36 of the Arms Export Control Act (22 U.S.C. 2776) and with 10 U.S.C. 2457. Accordingly, the following are qualifying countries:
                                </P>
                                <SCOL2>
                                    <LI>Australia</LI>
                                    <LI>Austria</LI>
                                    <LI>Belgium</LI>
                                    <LI>Canada</LI>
                                    <LI>Czech Republic</LI>
                                    <LI>Denmark</LI>
                                    <LI>Estonia</LI>
                                    <LI>Egypt</LI>
                                    <LI>Finland</LI>
                                    <LI>France</LI>
                                    <LI>Germany</LI>
                                    <LI>Greece</LI>
                                    <LI>Israel</LI>
                                    <LI>Italy</LI>
                                    <LI>Japan</LI>
                                    <LI>Latvia</LI>
                                    <LI>Lithuania</LI>
                                    <LI>Luxembourg</LI>
                                    <LI>Netherlands</LI>
                                    <LI>Norway</LI>
                                    <LI>Poland</LI>
                                    <LI>Portugal</LI>
                                    <LI>Slovenia</LI>
                                    <LI>Spain</LI>
                                    <LI>Sweden</LI>
                                    <LI>Switzerland</LI>
                                    <LI>Turkey</LI>
                                    <LI>United Kingdom of Great Britain and Northern Ireland</LI>
                                </SCOL2>
                                <P>
                                    <E T="03">Qualifying country photovoltaic device</E>
                                     means a photovoltaic device manufactured in a qualifying country.
                                </P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>
                                    <E T="03">U.S.-made photovoltaic device</E>
                                     means a photovoltaic device that—
                                </P>
                                <P>(1) Is manufactured in the United States; or</P>
                                <P>(2) Is substantially transformed in the United States into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed, provided that the photovoltaic device is not subsequently substantially transformed outside of the United States.</P>
                                <P>
                                    <E T="03">WTO GPA country photovoltaic device</E>
                                     means a photovoltaic device that—
                                </P>
                                <P>(1) Is wholly manufactured in a WTO GPA country; or</P>
                                <P>
                                    (2) In the case of a photovoltaic device that consists in whole or in part of materials 
                                    <PRTPAGE P="528"/>
                                    from another country, has been substantially transformed in a WTO GPA country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed, provided that the photovoltaic device is not subsequently substantially transformed outside of a WTO GPA country.
                                </P>
                                <P>(b) This clause implements section 846 of the National Defense Authorization Act for Fiscal Year 2011 (Pub. L. 111-383)).</P>
                                <P>
                                    (c) 
                                    <E T="03">Restriction.</E>
                                     If the Contractor specified in its offer in the Photovoltaic Devices—Certificate provision of the solicitation that the estimated value of the photovoltaic devices to be utilized in performance of this contract would be—
                                </P>
                                <P>(1) More than the micro-purchase threshold but less than $100,000, then the Contractor shall utilize only domestic photovoltaic devices unless, in its offer, it specified utilization of qualifying country or other foreign photovoltaic devices in paragraph (d)(2) of the Photovoltaic Devices—Certificate provision of the solicitation.</P>
                                <P>(2) $100,000 or more but less than $102,280, then the Contractor shall utilize under this contract only domestic photovoltaic devices, unless, in its offer, it specified utilization of Free Trade Agreement country photovoltaic devices (other than Bahraini, Korean, Moroccan, Panamanian, or Peruvian photovoltaic devices), qualifying country photovoltaic devices, or other foreign photovoltaic devices in paragraph (d)(4) of the Photovoltaic Devices—Certificate provision of the solicitation. If the Contractor certified in its offer that it will utilize a Free Trade Agreement country photovoltaic device (other than a Bahraini, Korean, Moroccan, Panamanian, or Peruvian photovoltaic device) or a qualifying country photovoltaic device, then the Contractor shall utilize a Free Trade Agreement country photovoltaic device (other than a Bahraini, Korean, Moroccan, Panamanian, or Peruvian photovoltaic device) or a qualifying country photovoltaic device; or, at the Contractor's option, a domestic photovoltaic device;</P>
                                <P>(3) $100,000 or more but less than $174,000, then the Contractor shall utilize under this contract only domestic photovoltaic devices, unless, in its offer it specified utilization of Free Trade Agreement country photovoltaic devices (other than Bahraini, Moroccan, Panamanian, or Peruvian photovoltaic devices), qualifying country photovoltaic devices, or other foreign photovoltaic devices in paragraph (d)(5) of the Photovoltaic Devices—Certificate provision of the solicitation. If the Contractor certified in its offer that it will utilize a Free Trade Agreement country photovoltaic device (other than a Bahraini, Moroccan, Panamanian, or Peruvian photovoltaic device) or a qualifying country photovoltaic device, then the Contractor shall utilize a Free Trade Agreement country photovoltaic device (other than a Bahraini, Moroccan, Panamanian, or Peruvian photovoltaic device) or a qualifying country photovoltaic device; or, at the Contractor's option, a domestic photovoltaic device; or</P>
                                <P>(4) $174,000 or more, then the Contractor shall utilize under this contract only U.S.-made, designated country, or qualifying country photovoltaic devices.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[76 FR 78861, Dec. 20, 2011]</CITA>
                            <EDNOTE>
                                <HD SOURCE="HED">Editorial Note:</HD>
                                <P>
                                    For 
                                    <E T="04">Federal Register</E>
                                     citations affecting section 252.225-7017, see the List of CFR Sections Affected, which appears in the Finding Aids section of the printed volume and at 
                                    <E T="03">www.govinfo.gov.</E>
                                </P>
                            </EDNOTE>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7018</SECTNO>
                            <SUBJECT>Photovoltaic Devices—Certificate.</SUBJECT>
                            <P>As prescribed in 225.7017-4(b), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Photovoltaic Devices—Certificate (MAR 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     “Bahraini photovoltaic device,” “Caribbean Basin photovoltaic device,” “designated country,” “designated country photovoltaic device,” “domestic photovoltaic device,” “foreign photovoltaic device,” “Free Trade Agreement country,” “Free Trade Agreement photovoltaic device,” “Korean photovoltaic device,” “least developed country photovoltaic device,” “Moroccan photovoltaic device,” “Panamanian photovoltaic device,” “Peruvian photovoltaic device,” “photovoltaic device,” “qualifying country,” “qualifying country photovoltaic device,” “United States,” “U.S.-made photovoltaic device,” and “WTO GPA country photovoltaic device” have the meanings given in the Photovoltaic Devices clause of this solicitation.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Restrictions.</E>
                                     The following restrictions apply, depending on the estimated aggregate value of photovoltaic devices to be utilized under a resultant contract:
                                </P>
                                <P>(1) If more than the micro-purchase threshold but less than $174,000, then the Government will not accept an offer specifying the use of other foreign photovoltaic devices in paragraph (d)(2)(ii), (d)(3)(ii), (d)(4)(ii), or (d)(5)(ii) of this provision, unless the Offeror documents to the satisfaction of the Contracting Officer that the price of the foreign photovoltaic device plus 50 percent is less than the price of a comparable domestic photovoltaic device.</P>
                                <P>
                                    (2) If $174,000 or more, then the Government will consider only offers that utilize photovoltaic devices that are U.S.-made, 
                                    <PRTPAGE P="529"/>
                                    qualifying country, or designated country photovoltaic devices.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Country in which a designated country photovoltaic device was wholly manufactured or was substantially transformed.</E>
                                     If the estimated value of the photovoltaic devices to be utilized under a resultant contract exceeds $102,280, the Offeror's certification that such photovoltaic device (
                                    <E T="03">e.g.,</E>
                                     solar panel) is a designated country photovoltaic device shall be consistent with country of origin determinations by the U.S. Customs and Border Protection with regard to importation of the same or similar photovoltaic devices into the United States. If the Offeror is uncertain as to what the country of origin would be determined to be by the U.S. Customs and Border Protection, the Offeror shall request a determination from U.S. Customs and Border Protection. (See 
                                    <E T="03">https://www.cbp.gov/trade/rulings.</E>
                                    )
                                </P>
                                <P>
                                    (d) 
                                    <E T="03">Certification and identification of country of origin. [The Offeror shall check the block and fill in the blank for one of the following paragraphs, based on the estimated value and the country of origin of photovoltaic devices to be utilized in performance of the contract:]</E>
                                </P>
                                <P>(1) No photovoltaic devices will be utilized in performance of the contract, or such photovoltaic devices have an estimated value that does not exceed the micro-purchase threshold.</P>
                                <P>(2) If more than the micro-purchase threshold but less than $100,000—</P>
                                <P>__(i) The Offeror certifies that each photovoltaic device to be utilized in performance of the contract is a domestic photovoltaic device;</P>
                                <P>
                                    __(ii) The Offeror certifies that each photovoltaic device to be utilized in performance of the contract is a qualifying country photovoltaic device 
                                    <E T="03">[Offeror to specify country of origin___];</E>
                                     or
                                </P>
                                <P>
                                    __(iii) The foreign (other than qualifying country) photovoltaic devices to be utilized in performance of the contract are the product of ___. 
                                    <E T="03">[Offeror to specify country of origin, if known, and provide documentation that the cost of a domestic photovoltaic device would be unreasonable in comparison to the cost of the proposed foreign photovoltaic device, i.e., that the price of the foreign photovoltaic device plus 50 percent is less than the price of a comparable domestic photovoltaic device.]</E>
                                </P>
                                <P>(3) If less than $100,000—</P>
                                <P>__(i) The Offeror certifies that each photovoltaic device to be utilized in performance of the contract is a domestic photovoltaic device;</P>
                                <P>
                                    __(ii) The Offeror certifies that each photovoltaic device to be utilized in performance of the contract is a qualifying country photovoltaic device 
                                    <E T="03">[Offeror to specify country of origin___];</E>
                                     or
                                </P>
                                <P>
                                    __(iii) The foreign photovoltaic devices to be utilized in performance of the contract are the product of___. 
                                    <E T="03">[Offeror to specify country of origin, if known, and provide documentation that the cost of a domestic photovoltaic device would be unreasonable in comparison to the cost of the proposed foreign photovoltaic device, i.e., that the price of the foreign photovoltaic device plus 50 percent is less than the price of a comparable domestic photovoltaic device.]</E>
                                </P>
                                <P>(4) If $100,000 or more but less than $102,280—</P>
                                <P>__(i) The Offeror certifies that each photovoltaic device to be utilized in performance of the contract is a domestic photovoltaic device;</P>
                                <P>
                                    __(ii) The Offeror certifies that each photovoltaic device to be utilized in performance of the contract is a Free Trade Agreement country photovoltaic device (other than a Bahraini, Korean, Moroccan, Panamanian, or Peruvian photovoltaic device) or a qualifying country photovoltaic device 
                                    <E T="03">[Offeror to specify country of origin___];</E>
                                     or
                                </P>
                                <P>
                                    __(iii) The offered foreign photovoltaic devices (other than those from countries listed in paragraph (d)(4)(ii) of this provision) are the product of ___. 
                                    <E T="03">[Offeror to specify country of origin, if known, and provide documentation that the cost of a domestic photovoltaic device would be unreasonable in comparison to the cost of the proposed foreign photovoltaic device, i.e. that the price of the foreign photovoltaic device plus 50 percent is less than the price of a comparable domestic photovoltaic device.]</E>
                                </P>
                                <P>(5) If $100,000 or more but less than $174,000—</P>
                                <P>__(i) The Offeror certifies that each photovoltaic device to be utilized in performance of the contract is a domestic photovoltaic device;</P>
                                <P>
                                    __(ii) The Offeror certifies that each photovoltaic device to be utilized in performance of the contract is a Free Trade Agreement country photovoltaic device (other than a Bahraini, Moroccan, Panamanian, or Peruvian photovoltaic device) or a qualifying country photovoltaic device 
                                    <E T="03">[Offeror to specify country of origin___];</E>
                                     or
                                </P>
                                <P>
                                    __(iii) The offered foreign photovoltaic devices (other than those from countries listed in paragraph (d)(5)(ii) of this provision) are the product of ___. 
                                    <E T="03">Offeror to specify country of origin, if known, and provide documentation that the cost of a domestic photovoltaic device would be unreasonable in comparison to the cost of the proposed foreign photovoltaic device, i.e., that the price of the foreign photovoltaic device plus 50 percent is less than the price of a comparable domestic photovoltaic device.]</E>
                                </P>
                                <P>(6) If $174,000 or more, the Offeror certifies that each photovoltaic device to be used in performance of the contract is—</P>
                                <P>__(i) A U.S.-made photovoltaic device; or</P>
                                <P>
                                    __(ii) A designated country photovoltaic device or a qualifying country photovoltaic 
                                    <PRTPAGE P="530"/>
                                    device. 
                                    <E T="03">[Offeror to specify country of origin___.]</E>
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[76 FR 78861, Dec. 20, 2011]</CITA>
                            <EDNOTE>
                                <HD SOURCE="HED">Editorial Note:</HD>
                                <P>
                                    For 
                                    <E T="04">Federal Register</E>
                                     citations affecting section 252.225-7018, see the List of CFR Sections Affected, which appears in the Finding Aids section of the printed volume and at 
                                    <E T="03">www.govinfo.gov.</E>
                                </P>
                            </EDNOTE>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7019</SECTNO>
                            <SUBJECT>Restriction on Acquisition of Anchor and Mooring Chain.</SUBJECT>
                            <P>As prescribed in 225.7004-7(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Restriction on Acquisition of Anchor and Mooring Chain (MAY 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Component</E>
                                     means an article, material, or supply incorporated directly into an end product.
                                </P>
                                <P>(b) Welded shipboard anchor and mooring chain delivered under this contract—</P>
                                <P>(1) Shall be manufactured in the United States or its outlying areas, including cutting, heat treating, quality control, testing, and welding (both forging and shot blasting process); and</P>
                                <P>(2) The cost of the components manufactured in the United States or its outlying areas shall exceed 50 percent of the total cost of components.</P>
                                <P>(c) The Contractor may request a waiver of this restriction if adequate domestic supplies meeting the requirements in paragraph (b) of this clause are not available to meet the contract delivery schedule.</P>
                                <P>(d) The Contractor shall insert the substance of this clause, including this paragraph (d), in all subcontracts for items containing welded shipboard anchor and mooring chain.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[68 FR 15637, Mar. 31, 2003, as amended at 70 FR 35547, June 21, 2005; 74 FR 68384, Dec. 24, 2009; 89 FR 46815, May 30, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7020</SECTNO>
                            <SUBJECT>Trade Agreements Certificate.</SUBJECT>
                            <P>
                                <E T="03">Basic.</E>
                                 As prescribed in 225.1101(5) and (5)(i), use the following provision:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Trade Agreements Certificate—Basic (NOV 2014)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions. Designated country end product, nondesignated country end product,</E>
                                     
                                    <E T="03">qualifying country end product,</E>
                                     and 
                                    <E T="03">U.S.-made end product,</E>
                                     as used in this provision have the meanings given in the Trade Agreements—Basic clause of this solicitation.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Evaluation.</E>
                                     The Government—
                                </P>
                                <P>(1) Will evaluate offers in accordance with the policies and procedures of part 225 of the Defense Federal Acquisition Regulation Supplement; and</P>
                                <P>(2) Will consider only offers of end products that are U.S.-made, qualifying country, or designated country end products unless—</P>
                                <P>(i) There are no offers of such end products;</P>
                                <P>(ii) The offers of such end products are insufficient to fulfill the Government's requirements; or</P>
                                <P>(iii) A national interest waiver has been granted.</P>
                                <P>
                                    (c) 
                                    <E T="03">Certification and identification of country of origin.</E>
                                     (1) For all line items subject to the Trade Agreements—Basic of this solicitation, the offeror certifies that each end product to be delivered under this contract, except those listed in paragraph (c)(2) of this provision, is a U.S.-made, qualifying country, or designated country end product.
                                </P>
                                <P>(2) The following supplies are other nondesignated country end products:</P>
                                <FP>
                                    (
                                    <E T="03">Line Item Number</E>
                                    )  (
                                    <E T="03">Country of Origin</E>
                                    )
                                </FP>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <P>
                                <E T="03">Alternate I.</E>
                                 As prescribed in 225.1101(5) and (5)(ii), use the following provision, which uses different paragraphs (a), (b)(2), and (c) than the basic provision:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Trade Agreements Certificate—Alternate I (NOV 2014)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions. Designated country end product, nondesignated country end product, qualifying country end product, South Caucasus/Central and South Asian (SC/CASA) state, South Caucasus/Central and South Asian (SC/CASA) state end product,</E>
                                     and 
                                    <E T="03">U.S.-made end product,</E>
                                     as used in this provision, have the meanings given in the Trade Agreements—Alternate I clause of this solicitation.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Evaluation.</E>
                                     The Government—
                                </P>
                                <P>(1) Will evaluate offers in accordance with the policies and procedures of part 225 of the Defense Federal Acquisition Regulation Supplement; and</P>
                                <P>(2) Will consider only offers of end products that are U.S.-made, qualifying country, SC/CASA state, or designated country end products unless—</P>
                                <P>(i) There are no offers of such end products;</P>
                                <P>(ii) The offers of such end products are insufficient to fulfill the Government's requirements; or</P>
                                <P>(iii) A national interest waiver has been granted.</P>
                                <P>
                                    (c) 
                                    <E T="03">Certification and identification of country of origin.</E>
                                </P>
                                <P>
                                    (1) For all line items subject to the Trade Agreement—Alternate I clause of this solicitation, the offeror certifies that each end product to be delivered under this contract, 
                                    <PRTPAGE P="531"/>
                                    except those listed in paragraph (c)(2)(ii) of this provision, is a U.S.-made, qualifying country, SC/CASA state, or designated country end product.
                                </P>
                                <P>(2)(i) The following supplies are SC/CASA state end products:</P>
                                <GPOTABLE COLS="2" OPTS="L0,8/9,g1,t1" CDEF="s50,r50">
                                    <ROW>
                                        <ENT I="21">(Line Item Number)</ENT>
                                        <ENT O="oi0">(Country of Origin)</ENT>
                                    </ROW>
                                </GPOTABLE>
                                <P>(ii) The following are other nondesignated country end products:</P>
                            </EXTRACT>
                            <GPOTABLE COLS="2" OPTS="L0,8/9,g1,t1" CDEF="s50,r50">
                                <ROW>
                                    <ENT I="21">(Line Item Number)</ENT>
                                    <ENT O="oi0">(Country of Origin)</ENT>
                                </ROW>
                            </GPOTABLE>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[70 FR 2363, Jan. 13, 2005, as amended at 75 FR 81919, Dec. 29, 2010; 79 FR 65820, Nov. 5, 2014; 80 FR 36899, June 26, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7021</SECTNO>
                            <SUBJECT>Trade Agreements.</SUBJECT>
                            <P>
                                <E T="03">Basic.</E>
                                 As prescribed in 225.1101(6) and (6)(i), use the following clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Trade Agreements—Basic (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Caribbean Basin country end product</E>
                                    —
                                </P>
                                <P>(1) Means an article that—</P>
                                <P>(i) Is wholly the growth, product, or manufacture of a Caribbean Basin country; or</P>
                                <P>(ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in a Caribbean Basin country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself; and</P>
                                <P>(2) Excludes products, other than petroleum and any product derived from petroleum, that are not granted duty-free treatment under the Caribbean Basin Economic Recovery Act (19 U.S.C. 2703(b)). These exclusions presently consist of—</P>
                                <P>(i) Textiles, apparel articles, footwear, handbags, luggage, flat goods, work gloves, leather wearing apparel, and handloomed, handmade, or folklore articles that are not granted duty-free status in the Harmonized Tariff Schedule of the United States (HTSUS);</P>
                                <P>(ii) Tuna, prepared or preserved in any manner in airtight containers; and</P>
                                <P>(iii) Watches and watch parts (including cases, bracelets, and straps) of whatever type, including, but not limited to, mechanical, quartz digital, or quartz analog, if such watches or watch parts contain any material that is the product of any country to which the HTSUS column 2 rates of duty (HTSUS General Note 3(b)) apply.</P>
                                <P>
                                    <E T="03">Commercially available off-the-shelf (COTS) item.</E>
                                     (1) Means any item of supply (including construction material) that is—
                                </P>
                                <P>(i) A commercial product (as defined in paragraph (1) of the definition of “commercial product” in section 2.101 of the Federal Acquisition Regulation);</P>
                                <P>(ii) Sold in substantial quantities in the commercial marketplace; and</P>
                                <P>(iii) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and</P>
                                <P>(2) Does not include bulk cargo, as defined in 46 U.S.C. 40102(4), such as agricultural products and petroleum products.</P>
                                <P>
                                    <E T="03">Component</E>
                                     means an article, material, or supply incorporated directly into an end product.
                                </P>
                                <P>
                                    <E T="03">Designated country</E>
                                     means—
                                </P>
                                <P>(1) A World Trade Organization Government Procurement Agreement (WTO GPA) country (Armenia, Aruba, Australia, Austria, Belgium, Bulgaria, Canada, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hong Kong, Hungary, Iceland, Ireland, Israel, Italy, Japan, Korea (Republic of), Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Moldova, Montenegro, Netherlands, New Zealand, North Macedonia, Norway, Poland, Portugal, Romania, Singapore, Slovak Republic, Slovenia, Spain, Sweden, Switzerland, Taiwan (known in the World Trade Organization as “the Separate Customs Territory of Taiwan, Penghu, Kinmen, and Matsu” (Chinese Taipei)), Ukraine, or the United Kingdom);</P>
                                <P>(2) A Free Trade Agreement country (Australia, Bahrain, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua, Panama, Peru, or Singapore);</P>
                                <P>(3) A least developed country (Afghanistan, Angola, Bangladesh, Benin, Bhutan, Burkina Faso, Burundi, Cambodia, Central African Republic, Chad, Comoros, Democratic Republic of Congo, Djibouti, Equatorial Guinea, Eritrea, Ethiopia, Gambia, Guinea, Guinea-Bissau, Haiti, Kiribati, Laos, Lesotho, Liberia, Madagascar, Malawi, Mali, Mauritania, Mozambique, Nepal, Niger, Rwanda, Samoa, Sao Tome and Principe, Senegal, Sierra Leone, Solomon Islands, Somalia, South Sudan, Tanzania, Timor-Leste, Togo, Tuvalu, Uganda, Vanuatu, Yemen, or Zambia); or</P>
                                <P>
                                    (4) A Caribbean Basin country (Antigua and Barbuda, Aruba, Bahamas, Barbados, Belize, Bonaire, British Virgin Islands, Curacao, Dominica, Grenada, Guyana, Haiti, Jamaica, Montserrat, Saba, St. Kitts and 
                                    <PRTPAGE P="532"/>
                                    Nevis, St. Lucia, St. Vincent and the Grenadines, Sint Eustatius, Sint Maarten, or Trinidad and Tobago).
                                </P>
                                <P>
                                    <E T="03">Designated country end product</E>
                                     means a WTO GPA country end product, a Free Trade Agreement country end product, a least developed country end product, or a Caribbean Basin country end product.
                                </P>
                                <P>
                                    <E T="03">End product</E>
                                     means those articles, materials, and supplies to be acquired under this contract for public use.
                                </P>
                                <P>
                                    <E T="03">Free Trade Agreement country end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a Free Trade Agreement country; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in a Free Trade Agreement country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Least developed country end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a least developed country; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in a least developed country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Nondesignated country end product</E>
                                     means any end product that is not a U.S.-made end product or a designated country end product.
                                </P>
                                <P>
                                    <E T="03">Qualifying country</E>
                                     means a country with a reciprocal defense procurement memorandum of understanding or international agreement with the United States in which both countries agree to remove barriers to purchases of supplies produced in the other country or services performed by sources of the other country, and the memorandum or agreement complies, where applicable, with the requirements of section 36 of the Arms Export Control Act (22 U.S.C. 2776) and with 10 U.S.C. 2457. Accordingly, the following are qualifying countries:
                                </P>
                                <SCOL2>
                                    <LI>Australia</LI>
                                    <LI>Austria</LI>
                                    <LI>Belgium</LI>
                                    <LI>Canada</LI>
                                    <LI>Czech Republic</LI>
                                    <LI>Denmark</LI>
                                    <LI>Egypt</LI>
                                    <LI>Estonia</LI>
                                    <LI>Finland</LI>
                                    <LI>France</LI>
                                    <LI>Germany</LI>
                                    <LI>Greece</LI>
                                    <LI>Israel</LI>
                                    <LI>Italy</LI>
                                    <LI>Japan</LI>
                                    <LI>Latvia</LI>
                                    <LI>Lithuania</LI>
                                    <LI>Luxembourg</LI>
                                    <LI>Netherlands</LI>
                                    <LI>Norway</LI>
                                    <LI>Poland</LI>
                                    <LI>Portugal</LI>
                                    <LI>Slovenia</LI>
                                    <LI>Spain</LI>
                                    <LI>Sweden</LI>
                                    <LI>Switzerland</LI>
                                    <LI>Turkey</LI>
                                    <LI>United Kingdom of Great Britain and Northern Ireland</LI>
                                </SCOL2>
                                <P>
                                    <E T="03">Qualifying country end product</E>
                                     means—
                                </P>
                                <P>(1) An unmanufactured end product mined or produced in a qualifying country; or</P>
                                <P>(2) An end product manufactured in a qualifying country if—</P>
                                <P>(i) The cost of the following types of components exceeds 60 percent of the cost of all its components, except that the percentage will be 65 percent for items delivered in calendar years 2024 through 2028 and 75 percent for items delivered starting in calendar year 2029, unless an alternate percentage is established for a contract:</P>
                                <P>
                                    (
                                    <E T="03">A</E>
                                    ) Components mined, produced, or manufactured in a qualifying country.
                                </P>
                                <P>
                                    (
                                    <E T="03">B</E>
                                    ) Components mined, produced, or manufactured in the United States.
                                </P>
                                <P>
                                    (
                                    <E T="03">C</E>
                                    ) Components of foreign origin of a class or kind for which the Government has determined that sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States; or
                                </P>
                                <P>(ii) The end product is a COTS item.</P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>
                                    <E T="03">U.S.-made end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is mined, produced, or manufactured in the United States; or</P>
                                <P>(2) Is substantially transformed in the United States into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed.</P>
                                <P>
                                    <E T="03">WTO GPA country end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a WTO GPA country; or</P>
                                <P>
                                    (2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in a WTO GPA country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end 
                                    <PRTPAGE P="533"/>
                                    product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.
                                </P>
                                <P>(b) Unless otherwise specified, this clause applies to all items in the Schedule.</P>
                                <P>(c) The Contractor shall deliver under this contract only U.S.-made, qualifying country, or designated country end products unless—</P>
                                <P>(1) In its offer, the Contractor specified delivery of other nondesignated country end products in the Trade Agreements Certificate provision of the solicitation; and</P>
                                <P>(2)(i) Offers of U.S.-made, qualifying country, or designated country end products from responsive, responsible offerors are either not received or are insufficient to fill the Government's requirements; or</P>
                                <P>(ii) A national interest waiver has been granted.</P>
                                <P>(d) The contract price does not include duty for end products or components for which the Contractor will claim duty-free entry.</P>
                                <P>
                                    (e) The HTSUS is available at 
                                    <E T="03">http://www.usitc.gov/tata/hts/bychapter/index.htm.</E>
                                     The following sections of the HTSUS provide information regarding duty-free status of articles specified in the definition of “Caribbean Basin country end product” within paragraph (a) of this clause:
                                </P>
                                <P>(1) General Note 3(c), Products Eligible for Special Tariff Treatment.</P>
                                <P>(2) General Note 17, Products of Countries Designated as Beneficiary Countries Under the United States-Caribbean Basin Trade Partnership Act of 2000.</P>
                                <P>(3) Section XXII, Chapter 98, Subchapter II, Articles Exported and Returned, Advanced or Improved Abroad, U.S. Note 7(b).</P>
                                <P>(4) Section XXII, Chapter 98, Subchapter XX, Goods Eligible for Special Tariff Benefits Under the United States-Caribbean Basin Trade Partnership Act.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate I</E>
                                 [Reserved]
                            </P>
                            <P>
                                <E T="03">Alternate II.</E>
                                 As prescribed in 225.1101(6) and (6)(ii), use the following clause, which (i) adds 
                                <E T="03">South Caucasus/Central and South Asian (SC/CASA) state</E>
                                 and 
                                <E T="03">South Caucasus/Central and South Asian (SC/CASA) state end product</E>
                                 to paragraph (a); (ii) uses a different paragraph (c) than the basic clause; (iii) adds a new paragraph (d); and (iv) includes paragraphs (e) and (f) which are the same paragraphs (d) and (e) of the basic clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Trade Agreements—Alternate II (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions. As used in this clause—Caribbean Basin country end product</E>
                                    —
                                </P>
                                <P>(1) Means an article that—</P>
                                <P>(i) Is wholly the growth, product, or manufacture of a Caribbean Basin country; or</P>
                                <P>(ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in a Caribbean Basin country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself; and</P>
                                <P>(2) Excludes products, other than petroleum and any product derived from petroleum, that are not granted duty-free treatment under the Caribbean Basin Economic Recovery Act (19 U.S.C. 2703(b)). These exclusions presently consist of—</P>
                                <P>(i) Textiles, apparel articles, footwear, handbags, luggage, flat goods, work gloves, leather wearing apparel, and handloomed, handmade, or folklore articles that are not granted duty-free status in the Harmonized Tariff Schedule of the United States (HTSUS);</P>
                                <P>(ii) Tuna, prepared or preserved in any manner in airtight containers; and</P>
                                <P>(iii) Watches and watch parts (including cases, bracelets, and straps) of whatever type, including, but not limited to, mechanical, quartz digital, or quartz analog, if such watches or watch parts contain any material that is the product of any country to which the HTSUS column 2 rates of duty (HTSUS General Note 3(b)) apply.</P>
                                <P>
                                    <E T="03">Commercially available off-the-shelf (COTS) item</E>
                                    —
                                </P>
                                <P>(1) Means any item of supply (including construction material) that is—</P>
                                <P>
                                    (i) A commercial product (as defined in paragraph (1) of the definition of 
                                    <E T="03">commercial product</E>
                                     in section 2.101 of the Federal Acquisition Regulation);
                                </P>
                                <P>(ii) Sold in substantial quantities in the commercial marketplace; and</P>
                                <P>(iii) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and</P>
                                <P>(2) Does not include bulk cargo, as defined in 46 U.S.C. 40102(4), such as agricultural products and petroleum products.</P>
                                <P>
                                    <E T="03">Component</E>
                                     means an article, material, or supply incorporated directly into an end product.
                                </P>
                                <P>
                                    <E T="03">Designated country</E>
                                     means—
                                    <PRTPAGE P="534"/>
                                </P>
                                <P>(1) A World Trade Organization Government Procurement Agreement (WTO GPA) country (Armenia, Aruba, Australia, Austria, Belgium, Bulgaria, Canada, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hong Kong, Hungary, Iceland, Ireland, Israel, Italy, Japan, Korea (Republic of), Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Moldova, Montenegro, Netherlands, New Zealand, North Macedonia, Norway, Poland, Portugal, Romania, Singapore, Slovak Republic, Slovenia, Spain, Sweden, Switzerland, Taiwan (known in the World Trade Organization as “the Separate Customs Territory of Taiwan, Penghu, Kinmen, and Matsu” (Chinese Taipei)), Ukraine, or the United Kingdom);</P>
                                <P>(2) A Free Trade Agreement country (Australia, Bahrain,  Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua, Peru, or Singapore);</P>
                                <P>(3) A least developed country (Afghanistan, Angola, Bangladesh, Benin, Bhutan, Burkina Faso, Burundi, Cambodia, Central African Republic, Chad, Comoros, Democratic Republic of Congo, Djibouti, East Timor, Equatorial Guinea, Eritrea, Ethiopia, Gambia, Guinea, Guinea-Bissau, Haiti, Kiribati, Laos, Lesotho, Liberia, Madagascar, Malawi, Maldives, Mali, Mauritania, Mozambique, Nepal, Niger, Rwanda, Samoa, Sao Tome and Principe, Senegal, Sierra Leone, Solomon Islands, Somalia, Tanzania, Togo, Tuvalu, Uganda, Vanuatu, Yemen, or Zambia); or</P>
                                <P>(4) A Caribbean Basin country (Antigua and Barbuda, Aruba, Bahamas, Barbados, Belize, Bonaire, British Virgin Islands, Curacao, Dominica, Grenada, Guyana, Haiti, Jamaica, Montserrat, Saba, St. Kitts and Nevis, St. Lucia, St. Vincent and the Grenadines, Sint Eustatius, Sint Maarten, or Trinidad and Tobago).</P>
                                <P>
                                    <E T="03">Designated country end product</E>
                                     means a WTO GPA country end product, a Free Trade Agreement country end product, a least developed country end product, or a Caribbean Basin country end product.
                                </P>
                                <P>
                                    <E T="03">End product</E>
                                     means those articles, materials, and supplies to be acquired under this contract for public use.
                                </P>
                                <P>
                                    <E T="03">Free Trade Agreement country end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a Free Trade Agreement country; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in a Free Trade Agreement country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Least developed country end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a least developed country; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in a least developed country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Nondesignated country end product</E>
                                     means any end product that is not a U.S.-made end product or a designated country end product.
                                </P>
                                <P>
                                    <E T="03">Qualifying country</E>
                                     means a country with a reciprocal defense procurement memorandum of understanding or international agreement with the United States in which both countries agree to remove barriers to purchases of supplies produced in the other country or services performed by sources of the other country, and the memorandum or agreement complies, where applicable, with the requirements of section 36 of the Arms Export Control Act (22 U.S.C. 2776) and with 10 U.S.C. 2457. Accordingly, the following are qualifying countries:
                                </P>
                                <SCOL2>
                                    <LI>Australia</LI>
                                    <LI>Austria</LI>
                                    <LI>Belgium</LI>
                                    <LI>Canada</LI>
                                    <LI>Czech Republic</LI>
                                    <LI>Denmark</LI>
                                    <LI>Egypt</LI>
                                    <LI>Estonia</LI>
                                    <LI>Finland</LI>
                                    <LI>France</LI>
                                    <LI>Germany</LI>
                                    <LI>Greece</LI>
                                    <LI>Israel</LI>
                                    <LI>Italy</LI>
                                    <LI>Japan</LI>
                                    <LI>Latvia</LI>
                                    <LI>Lithuania</LI>
                                    <LI>Luxembourg</LI>
                                    <LI>Netherlands</LI>
                                    <LI>Norway</LI>
                                    <LI>Poland</LI>
                                    <LI>Portugal</LI>
                                    <LI>Slovenia</LI>
                                    <LI>Spain</LI>
                                    <LI>Sweden</LI>
                                    <LI>Switzerland</LI>
                                    <LI>Turkey</LI>
                                    <LI>United Kingdom of Great Britain and Northern Ireland.</LI>
                                </SCOL2>
                                <P>
                                    <E T="03">Qualifying country end product</E>
                                     means—
                                </P>
                                <P>(1) An unmanufactured end product mined or produced in a qualifying country; or</P>
                                <P>(2) An end product manufactured in a qualifying country if—</P>
                                <P>
                                    (i) The cost of the following types of components exceeds 60 percent of the cost of all its components, except that the percentage will be 65 percent for items delivered in calendar years 2024 through 2028 and 75 percent for items delivered starting in calendar year 
                                    <PRTPAGE P="535"/>
                                    2029, unless an alternate percentage is established for a contract:
                                </P>
                                <P>
                                    (
                                    <E T="03">A</E>
                                    ) Components mined, produced, or manufactured in a qualifying country.
                                </P>
                                <P>
                                    (
                                    <E T="03">B</E>
                                    ) Components mined, produced, or manufactured in the United States.
                                </P>
                                <P>
                                    (
                                    <E T="03">C</E>
                                    ) Components of foreign origin of a class or kind for which the Government has determined that sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States; or
                                </P>
                                <P>(ii) The end product is a COTS item.</P>
                                <P>
                                    <E T="03">South Caucasus/Central and South Asian (SC/CASA) state</E>
                                     means Armenia, Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, Pakistan, Tajikistan, Turkmenistan, or Uzbekistan.
                                </P>
                                <P>
                                    <E T="03">South Caucasus/Central and South Asian (SC/CASA) state end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of an SC/CASA state; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in an SC/CASA state into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>
                                    <E T="03">U.S.-made end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is mined, produced, or manufactured in the United States; or</P>
                                <P>(2) Is substantially transformed in the United States into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed.</P>
                                <P>
                                    <E T="03">WTO GPA country end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a WTO GPA country; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in a WTO GPA country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>(b) Unless otherwise specified, this clause applies to all items in the Schedule.</P>
                                <P>(c) The Contractor shall deliver under this contract only U.S.-made, qualifying country, SC/CASA state, or designated country end products unless—</P>
                                <P>(1) In its offer, the Contractor specified delivery of other nondesignated country end products in the Trade Agreements Certificate provision of the solicitation; and</P>
                                <P>(2)(i) Offers of U.S.-made, qualifying country, SC/CASA state, or designated country end products from responsive, responsible offerors are either not received or are insufficient to fill the Government's requirements; or</P>
                                <P>(ii) A national interest waiver has been granted.</P>
                                <P>(d) If the Contractor is from an SC/CASA state, the Contractor shall inform its government of its participation in this acquisition and that it generally will not have such opportunity in the future unless its government provides reciprocal procurement opportunities to U.S. products and services and suppliers of such products and services.</P>
                                <P>(e) The contract price does not include duty for end products or components for which the Contractor will claim duty-free entry.</P>
                                <P>
                                    (f) The HTSUS is available at 
                                    <E T="03">http://www.usitc.gov/tata/hts/bychapter/index.htm.</E>
                                     The following sections of the HTSUS provide information regarding duty-free status of articles specified in the definition of “Caribbean Basin country end product” within paragraph (a) of this clause:
                                </P>
                                <P>(1) General Note 3(c), Products Eligible for Special Tariff Treatment.</P>
                                <P>(2) General Note 17, Products of Countries Designated as Beneficiary Countries Under the United States—Caribbean Basin Trade Partnership Act of 2000.</P>
                                <P>(3) Section XXII, Chapter 98, Subchapter II, Articles Exported and Returned, Advanced or Improved Abroad, U.S. Note 7(b).</P>
                                <P>(4) Section XXII, Chapter 98, Subchapter XX, Goods Eligible for Special Tariff Benefits Under the United States—Caribbean Basin Trade Partnership Act.</P>
                                <P>
                                    <E T="03">Alternate III.</E>
                                     As prescribed in 225.1101(6) and (6)(iii), use the following clause, which includes, in the definition of “qualifying country end product” at paragraph (2)(i), the domestic content threshold that will apply to the entire contract period of performance.
                                </P>
                                <HD SOURCE="HD1">Trade Agreements—Alternate III (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Caribbean Basin country end product</E>
                                    —
                                </P>
                                <P>(1) Means an article that—</P>
                                <P>(i) Is wholly the growth, product, or manufacture of a Caribbean Basin country; or</P>
                                <P>
                                    (ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed 
                                    <PRTPAGE P="536"/>
                                    in a Caribbean Basin country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself; and
                                </P>
                                <P>(2) Excludes products, other than petroleum and any product derived from petroleum, that are not granted duty-free treatment under the Caribbean Basin Economic Recovery Act (19 U.S.C. 2703(b)). These exclusions presently consist of—</P>
                                <P>(i) Textiles, apparel articles, footwear, handbags, luggage, flat goods, work gloves, leather wearing apparel, and handloomed, handmade, or folklore articles that are not granted duty-free status in the Harmonized Tariff Schedule of the United States (HTSUS);</P>
                                <P>(ii) Tuna, prepared or preserved in any manner in airtight containers; and</P>
                                <P>(iii) Watches and watch parts (including cases, bracelets, and straps) of whatever type, including, but not limited to, mechanical, quartz digital, or quartz analog, if such watches or watch parts contain any material that is the product of any country to which the HTSUS column 2 rates of duty (HTSUS General Note 3(b)) apply.</P>
                                <P>
                                    <E T="03">Commercially available off-the-shelf (COTS) item</E>
                                    —
                                </P>
                                <P>(1) Means any item of supply (including construction material) that is—</P>
                                <P>(i) A commercial product (as defined in paragraph (1) of the definition of “commercial product” in section 2.101 of the Federal Acquisition Regulation);</P>
                                <P>(ii) Sold in substantial quantities in the commercial marketplace; and</P>
                                <P>(iii) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and</P>
                                <P>(2) Does not include bulk cargo, as defined in 46 U.S.C. 40102(4), such as agricultural products and petroleum products.</P>
                                <P>
                                    <E T="03">Component</E>
                                     means an article, material, or supply incorporated directly into an end product.
                                </P>
                                <P>“Designated country” means—</P>
                                <P>(1) A World Trade Organization Government Procurement Agreement (WTO GPA) country (Armenia, Aruba, Australia, Austria, Belgium, Bulgaria, Canada, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hong Kong, Hungary, Iceland, Ireland, Israel, Italy, Japan, Korea (Republic of), Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Moldova, Montenegro, Netherlands, New Zealand, North Macedonia, Norway, Poland, Portugal, Romania, Singapore, Slovak Republic, Slovenia, Spain, Sweden, Switzerland, Taiwan (known in the World Trade Organization as “the Separate Customs Territory of Taiwan, Penghu, Kinmen, and Matsu” (Chinese Taipei)), Ukraine, or the United Kingdom);</P>
                                <P>(2) A Free Trade Agreement country (Australia, Bahrain, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua, Panama, Peru, or Singapore);</P>
                                <P>(3) A least developed country (Afghanistan, Angola, Bangladesh, Benin, Bhutan, Burkina Faso, Burundi, Cambodia, Central African Republic, Chad, Comoros, Democratic Republic of Congo, Djibouti, Equatorial Guinea, Eritrea, Ethiopia, Gambia, Guinea, Guinea-Bissau, Haiti, Kiribati, Laos, Lesotho, Liberia, Madagascar, Malawi, Mali, Mauritania, Mozambique, Nepal, Niger, Rwanda, Samoa, Sao Tome and Principe, Senegal, Sierra Leone, Solomon Islands, Somalia, South Sudan, Tanzania, Timor-Leste, Togo, Tuvalu, Uganda, Vanuatu, Yemen, or Zambia); or</P>
                                <P>(4) A Caribbean Basin country (Antigua and Barbuda, Aruba, Bahamas, Barbados, Belize, Bonaire, British Virgin Islands, Curacao, Dominica, Grenada, Guyana, Haiti, Jamaica, Montserrat, Saba, St. Kitts and Nevis, St. Lucia, St. Vincent and the Grenadines, Sint Eustatius, Sint Maarten, or Trinidad and Tobago).</P>
                                <P>
                                    <E T="03">Designated country end product</E>
                                     means a WTO GPA country end product, a Free Trade Agreement country end product, a least developed country end product, or a Caribbean Basin country end product.
                                </P>
                                <P>
                                    <E T="03">End product</E>
                                     means those articles, materials, and supplies to be acquired under this contract for public use.
                                </P>
                                <P>
                                    <E T="03">Free Trade Agreement country end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a Free Trade Agreement country; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in a Free Trade Agreement country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Least developed country end product</E>
                                     means an article that—
                                </P>
                                <P>
                                    (1) Is wholly the growth, product, or manufacture of a least developed country; or
                                    <PRTPAGE P="537"/>
                                </P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in a least developed country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Nondesignated country end product</E>
                                     means any end product that is not a U.S.-made end product or a designated country end product.
                                </P>
                                <P>
                                    <E T="03">Qualifying country</E>
                                     means a country with a reciprocal defense procurement memorandum of understanding or international agreement with the United States in which both countries agree to remove barriers to purchases of supplies produced in the other country or services performed by sources of the other country, and the memorandum or agreement complies, where applicable, with the requirements of section 36 of the Arms Export Control Act (22 U.S.C. 2776) and with 10 U.S.C. 2457. Accordingly, the following are qualifying countries:
                                </P>
                                <FP SOURCE="FP-1">Australia</FP>
                                <FP SOURCE="FP-1">Austria</FP>
                                <FP SOURCE="FP-1">Belgium</FP>
                                <FP SOURCE="FP-1">Canada</FP>
                                <FP SOURCE="FP-1">Czech Republic</FP>
                                <FP SOURCE="FP-1">Denmark</FP>
                                <FP SOURCE="FP-1">Egypt</FP>
                                <FP SOURCE="FP-1">Estonia</FP>
                                <FP SOURCE="FP-1">Finland</FP>
                                <FP SOURCE="FP-1">France</FP>
                                <FP SOURCE="FP-1">Germany</FP>
                                <FP SOURCE="FP-1">Greece</FP>
                                <FP SOURCE="FP-1">Israel</FP>
                                <FP SOURCE="FP-1">Italy</FP>
                                <FP SOURCE="FP-1">Japan</FP>
                                <FP SOURCE="FP-1">Latvia</FP>
                                <FP SOURCE="FP-1">Lithuania</FP>
                                <FP SOURCE="FP-1">Luxembourg</FP>
                                <FP SOURCE="FP-1">Netherlands</FP>
                                <FP SOURCE="FP-1">Norway</FP>
                                <FP SOURCE="FP-1">Poland</FP>
                                <FP SOURCE="FP-1">Portugal</FP>
                                <FP SOURCE="FP-1">Slovenia</FP>
                                <FP SOURCE="FP-1">Spain</FP>
                                <FP SOURCE="FP-1">Sweden</FP>
                                <FP SOURCE="FP-1">Switzerland</FP>
                                <FP SOURCE="FP-1">Turkey</FP>
                                <FP SOURCE="FP-1">United Kingdom of Great Britain and Northern Ireland.</FP>
                                <P>
                                    <E T="03">Qualifying country end product</E>
                                     means—
                                </P>
                                <P>(1) An unmanufactured end product mined or produced in a qualifying country; or</P>
                                <P>(2) An end product manufactured in a qualifying country if—</P>
                                <P>(i) The cost of the following types of components exceeds, for the entire period of performance for a contract awarded in: calendar year 2023, 60 percent of the cost of all its components; calendar years 2024 through 2028, 65 percent of the cost of all its components; or calendar year 2029 or later, 75 percent of the cost of all its components:</P>
                                <P>(A) Components mined, produced, or manufactured in a qualifying country.</P>
                                <P>(B) Components mined, produced, or manufactured in the United States.</P>
                                <P>(C) Components of foreign origin of a class or kind for which the Government has determined that sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States; or</P>
                                <P>(ii) The end product is a COTS item.</P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>
                                    <E T="03">U.S.-made end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is mined, produced, or manufactured in the United States; or</P>
                                <P>(2) Is substantially transformed in the United States into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed.</P>
                                <P>
                                    <E T="03">WTO GPA country end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a WTO GPA country; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in a WTO GPA country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>(b) Unless otherwise specified, this clause applies to all items in the Schedule.</P>
                                <P>(c) The Contractor shall deliver under this contract only U.S.-made, qualifying country, or designated country end products unless—</P>
                                <P>(1) In its offer, the Contractor specified delivery of other nondesignated country end products in the Trade Agreements Certificate provision of the solicitation; and</P>
                                <P>(2)(i) Offers of U.S.-made, qualifying country, or designated country end products from responsive, responsible offerors are either not received or are insufficient to fill the Government's requirements; or</P>
                                <P>(ii) A national interest waiver has been granted.</P>
                                <P>
                                    (d) The contract price does not include duty for end products or components for which the Contractor will claim duty-free entry.
                                    <PRTPAGE P="538"/>
                                </P>
                                <P>
                                    (e) The HTSUS is available at 
                                    <E T="03">http://www.usitc.gov/tata/hts/bychapter/index.htm.</E>
                                     The following sections of the HTSUS provide information regarding duty-free status of articles specified in the definition of “Caribbean Basin country end product” within paragraph (a) of this clause:
                                </P>
                                <P>(1) General Note 3(c), Products Eligible for Special Tariff Treatment.</P>
                                <P>(2) General Note 17, Products of Countries Designated as Beneficiary Countries Under the United States-Caribbean Basin Trade Partnership Act of 2000.</P>
                                <P>(3) Section XXII, Chapter 98, Subchapter II, Articles Exported and Returned, Advanced or Improved Abroad, U.S. Note 7(b).</P>
                                <P>(4) Section XXII, Chapter 98, Subchapter XX, Goods Eligible for Special Tariff Benefits Under the United States-Caribbean Basin Trade Partnership Act.</P>
                                <HD SOURCE="HD3">(End of clause)</HD>
                                <P>
                                    <E T="03">Alternate IV.</E>
                                     As prescribed in 225.1101(6) and (6)(iv), use the following clause, which (i) includes, in the definition of “qualifying country end product” at paragraph (2)(i), the domestic content threshold that will apply to the entire contract period of performance; (ii) adds “South Caucasus/Central and South Asian (SC/CASA) state” and “South Caucasus/Central and South Asian (SC/CASA) state end product” to paragraph (a); (iii) uses a different paragraph (c) than the basic clause; (iv) adds a new paragraph (d); and (v) includes paragraphs (e) and (f) which are the same paragraphs (d) and (e) of the basic clause:
                                </P>
                                <HD SOURCE="HD1">Trade Agreements—Alternate IV (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Caribbean Basin country end product</E>
                                    —
                                </P>
                                <P>(1) Means an article that—</P>
                                <P>(i) Is wholly the growth, product, or manufacture of a Caribbean Basin country; or</P>
                                <P>(ii) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in a Caribbean Basin country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself; and</P>
                                <P>(2) Excludes products, other than petroleum and any product derived from petroleum, that are not granted duty-free treatment under the Caribbean Basin Economic Recovery Act (19 U.S.C. 2703(b)). These exclusions presently consist of—</P>
                                <P>(i) Textiles, apparel articles, footwear, handbags, luggage, flat goods, work gloves, leather wearing apparel, and handloomed, handmade, or folklore articles that are not granted duty-free status in the Harmonized Tariff Schedule of the United States (HTSUS);</P>
                                <P>(ii) Tuna, prepared or preserved in any manner in airtight containers; and</P>
                                <P>(iii) Watches and watch parts (including cases, bracelets, and straps) of whatever type, including, but not limited to, mechanical, quartz digital, or quartz analog, if such watches or watch parts contain any material that is the product of any country to which the HTSUS column 2 rates of duty (HTSUS General Note 3(b)) apply.</P>
                                <P>
                                    <E T="03">Commercially available off-the-shelf (COTS) item</E>
                                    —
                                </P>
                                <P>(1) Means any item of supply (including construction material) that is—</P>
                                <P>(i) A commercial product (as defined in paragraph (1) of the definition of commercial product in section 2.101 of the Federal Acquisition Regulation);</P>
                                <P>(ii) Sold in substantial quantities in the commercial marketplace; and</P>
                                <P>(iii) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and</P>
                                <P>(2) Does not include bulk cargo, as defined in 46 U.S.C. 40102(4), such as agricultural products and petroleum products.</P>
                                <P>
                                    <E T="03">Component</E>
                                     means an article, material, or supply incorporated directly into an end product.
                                </P>
                                <P>
                                    <E T="03">Designated country</E>
                                     means—
                                </P>
                                <P>(1) A World Trade Organization Government Procurement Agreement (WTO GPA) country (Armenia, Aruba, Australia, Austria, Belgium, Bulgaria, Canada, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hong Kong, Hungary, Iceland, Ireland, Israel, Italy, Japan, Korea (Republic of), Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Moldova, Montenegro, Netherlands, New Zealand, North Macedonia, Norway, Poland, Portugal, Romania, Singapore, Slovak Republic, Slovenia, Spain, Sweden, Switzerland, Taiwan (known in the World Trade Organization as “the Separate Customs Territory of Taiwan, Penghu, Kinmen, and Matsu” (Chinese Taipei)), Ukraine, or the United Kingdom);</P>
                                <P>(2) A Free Trade Agreement country (Australia, Bahrain, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua, Peru, or Singapore);</P>
                                <P>
                                    (3) A least developed country (Afghanistan, Angola, Bangladesh, Benin, Bhutan, Burkina Faso, Burundi, Cambodia, Central African Republic, Chad, Comoros, Democratic Republic of Congo, Djibouti, East Timor, Equatorial Guinea, Eritrea, Ethiopia, Gambia, 
                                    <PRTPAGE P="539"/>
                                    Guinea, Guinea-Bissau, Haiti, Kiribati, Laos, Lesotho, Liberia, Madagascar, Malawi, Maldives, Mali, Mauritania, Mozambique, Nepal, Niger, Rwanda, Samoa, Sao Tome and Principe, Senegal, Sierra Leone, Solomon Islands, Somalia, Tanzania, Togo, Tuvalu, Uganda, Vanuatu, Yemen, or Zambia); or
                                </P>
                                <P>(4) A Caribbean Basin country (Antigua and Barbuda, Aruba, Bahamas, Barbados, Belize, Bonaire, British Virgin Islands, Curacao, Dominica, Grenada, Guyana, Haiti, Jamaica, Montserrat, Saba, St. Kitts and Nevis, St. Lucia, St. Vincent and the Grenadines, Sint Eustatius, Sint Maarten, or Trinidad and Tobago).</P>
                                <P>
                                    <E T="03">Designated country end product</E>
                                     means a WTO GPA country end product, a Free Trade Agreement country end product, a least developed country end product, or a Caribbean Basin country end product.
                                </P>
                                <P>
                                    <E T="03">End product</E>
                                     means those articles, materials, and supplies to be acquired under this contract for public use.
                                </P>
                                <P>
                                    <E T="03">Free Trade Agreement country end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a Free Trade Agreement country; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in a Free Trade Agreement country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Least developed country end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a least developed country; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in a least developed country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Nondesignated country end product</E>
                                     means any end product that is not a U.S.-made end product or a designated country end product.
                                </P>
                                <P>
                                    <E T="03">Qualifying country</E>
                                     means a country with a reciprocal defense procurement memorandum of understanding or international agreement with the United States in which both countries agree to remove barriers to purchases of supplies produced in the other country or services performed by sources of the other country, and the memorandum or agreement complies, where applicable, with the requirements of section 36 of the Arms Export Control Act (22 U.S.C. 2776) and with 10 U.S.C. 2457. Accordingly, the following are qualifying countries:
                                </P>
                                <FP SOURCE="FP-1">Australia</FP>
                                <FP SOURCE="FP-1">Austria</FP>
                                <FP SOURCE="FP-1">Belgium</FP>
                                <FP SOURCE="FP-1">Canada</FP>
                                <FP SOURCE="FP-1">Czech Republic</FP>
                                <FP SOURCE="FP-1">Denmark</FP>
                                <FP SOURCE="FP-1">Egypt</FP>
                                <FP SOURCE="FP-1">Estonia</FP>
                                <FP SOURCE="FP-1">Finland</FP>
                                <FP SOURCE="FP-1">France</FP>
                                <FP SOURCE="FP-1">Germany</FP>
                                <FP SOURCE="FP-1">Greece</FP>
                                <FP SOURCE="FP-1">Israel</FP>
                                <FP SOURCE="FP-1">Italy</FP>
                                <FP SOURCE="FP-1">Japan</FP>
                                <FP SOURCE="FP-1">Latvia</FP>
                                <FP SOURCE="FP-1">Lithuania</FP>
                                <FP SOURCE="FP-1">Luxembourg</FP>
                                <FP SOURCE="FP-1">Netherlands</FP>
                                <FP SOURCE="FP-1">Norway</FP>
                                <FP SOURCE="FP-1">Poland</FP>
                                <FP SOURCE="FP-1">Portugal</FP>
                                <FP SOURCE="FP-1">Slovenia</FP>
                                <FP SOURCE="FP-1">Spain</FP>
                                <FP SOURCE="FP-1">Sweden</FP>
                                <FP SOURCE="FP-1">Switzerland</FP>
                                <FP SOURCE="FP-1">Turkey</FP>
                                <FP SOURCE="FP-1">United Kingdom of Great Britain and Northern Ireland.</FP>
                                <P>
                                    <E T="03">Qualifying country end product</E>
                                     means—
                                </P>
                                <P>(1) An unmanufactured end product mined or produced in a qualifying country; or</P>
                                <P>(2) An end product manufactured in a qualifying country if—</P>
                                <P>(i) The cost of the following types of components exceeds, for the entire period of performance for a contract awarded in: calendar year 2023, 60 percent of the cost of all its components; calendar years 2024 through 2028, 65 percent of the cost of all its components; or calendar year 2029 or later, 75 percent of the cost of all its components:</P>
                                <P>(A) Components mined, produced, or manufactured in a qualifying country.</P>
                                <P>(B) Components mined, produced, or manufactured in the United States.</P>
                                <P>(C) Components of foreign origin of a class or kind for which the Government has determined that sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States; or</P>
                                <P>(ii) The end product is a COTS item.</P>
                                <P>
                                    <E T="03">South Caucasus/Central and South Asian (SC/CASA) state</E>
                                     means Armenia, Azerbaijan, 
                                    <PRTPAGE P="540"/>
                                    Georgia, Kazakhstan, Kyrgyzstan, Pakistan, Tajikistan, Turkmenistan, or Uzbekistan.
                                </P>
                                <P>
                                    <E T="03">South Caucasus/Central and South Asian (SC/CASA) state end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of an SC/CASA state; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in an SC/CASA state into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>
                                    <E T="03">U.S.-made end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is mined, produced, or manufactured in the United States; or</P>
                                <P>(2) Is substantially transformed in the United States into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed.</P>
                                <P>
                                    <E T="03">WTO GPA country end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a WTO GPA country; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in a WTO GPA country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>(b) Unless otherwise specified, this clause applies to all items in the Schedule.</P>
                                <P>(c) The Contractor shall deliver under this contract only U.S.-made, qualifying country, SC/CASA state, or designated country end products unless—</P>
                                <P>(1) In its offer, the Contractor specified delivery of other nondesignated country end products in the Trade Agreements Certificate provision of the solicitation; and</P>
                                <P>(2)(i) Offers of U.S.-made, qualifying country, SC/CASA state, or designated country end products from responsive, responsible offerors are either not received or are insufficient to fill the Government's requirements; or</P>
                                <P>(ii) A national interest waiver has been granted.</P>
                                <P>(d) If the Contractor is from an SC/CASA state, the Contractor shall inform its government of its participation in this acquisition and that it generally will not have such opportunity in the future unless its government provides reciprocal procurement opportunities to U.S. products and services and suppliers of such products and services.</P>
                                <P>(e) The contract price does not include duty for end products or components for which the Contractor will claim duty-free entry.</P>
                                <P>
                                    (f) The HTSUS is available at 
                                    <E T="03">http://www.usitc.gov/tata/hts/bychapter/index.htm.</E>
                                     The following sections of the HTSUS provide information regarding duty-free status of articles specified in the definition of “Caribbean Basin country end product” within paragraph (a) of this clause:
                                </P>
                                <P>(1) General Note 3(c), Products Eligible for Special Tariff Treatment.</P>
                                <P>(2) General Note 17, Products of Countries Designated as Beneficiary Countries Under the United States—Caribbean Basin Trade Partnership Act of 2000.</P>
                                <P>(3) Section XXII, Chapter 98, Subchapter II, Articles Exported and Returned, Advanced or Improved Abroad, U.S. Note 7(b).</P>
                                <P>(4) Section XXII, Chapter 98, Subchapter XX, Goods Eligible for Special Tariff Benefits Under the United States—Caribbean Basin Trade Partnership Act.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[68 FR 15637, Mar. 31, 2003]</CITA>
                            <EDNOTE>
                                <HD SOURCE="HED">Editorial Note:</HD>
                                <P>
                                    For 
                                    <E T="04">Federal Register</E>
                                     citations affecting section 252.225-7021, see the List of CFR Sections Affected, which appears in the Finding Aids section of the printed volume and at 
                                    <E T="03">www.govinfo.gov.</E>
                                </P>
                            </EDNOTE>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7022</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7023</SECTNO>
                            <SUBJECT>Preference for Products or Services from Afghanistan.</SUBJECT>
                            <P>
                                As prescribed in 225.7703-
                                <E T="03">4</E>
                                (a), use the following provision:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Preference for Products or Services From Afghanistan (SEP 2013)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     “Product from Afghanistan” and “service from Afghanistan,” as used in this provision, are defined in the clause of this solicitation entitled “Requirement for Products or Services from Afghanistan” (DFARS 252.225-7024).
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Representation.</E>
                                     The offeror represents that all products or services to be delivered under a contract resulting from this solicitation are products from Afghanistan or services from Afghanistan, except those listed in—
                                    <PRTPAGE P="541"/>
                                </P>
                                <P>(1) Paragraph (c) of this provision; or</P>
                                <P>(2) Paragraph (c)(2) of the provision entitled “Trade Agreements Certificate,” if included in this solicitation.</P>
                                <P>
                                    (c) 
                                    <E T="03">Other products or services.</E>
                                     The following offered products or services are not products from Afghanistan or services from Afghanistan:
                                </P>
                                <FP SOURCE="FP-1">
                                    (
                                    <E T="03">Line Item Number</E>
                                    ) (
                                    <E T="03">Country of Origin</E>
                                    )
                                </FP>
                                <P>
                                    (d) 
                                    <E T="03">Evaluation.</E>
                                     For the purpose of evaluating competitive offers, the Contracting Officer will increase by 50 percent the prices of offers of products or services that are not products or services from Afghanistan.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[78 FR 59859, Sept. 30, 2013]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7024</SECTNO>
                            <SUBJECT>Requirement for Products or Services from Afghanistan.</SUBJECT>
                            <P>
                                As prescribed in 225.7703-
                                <E T="03">4</E>
                                (b), use the following clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Requirement for Products or Services From Afghanistan (SEP 2013)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>(1) “Product from Afghanistan” means a product that is mined, produced, or manufactured in Afghanistan.</P>
                                <P>(2) “Service from Afghanistan” means a service including construction that is performed in Afghanistan predominantly by citizens or permanent resident aliens of Afghanistan.</P>
                                <P>(b) The Contractor shall provide only products from Afghanistan or services from Afghanistan under this contract, unless, in its offer, it specified that it would provide products or services other than products from Afghanistan or services from Afghanistan.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[78 FR 59859, Sept. 30, 2013]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7025</SECTNO>
                            <SUBJECT>Restriction on acquisition of forgings.</SUBJECT>
                            <P>As prescribed in 225.7102-4, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Restriction on Acquisition of Forgings (DEC 2009)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>(1) Component means any item supplied to the Government as part of an end product or of another component.</P>
                                <P>(2) Domestic manufacture means manufactured in the United States, its outlying areas, or Canada.</P>
                                <P>
                                    (3) 
                                    <E T="03">Forging items</E>
                                     means—
                                </P>
                                <GPOTABLE COLS="2" OPTS="L2" CDEF="s50,r50">
                                    <BOXHD>
                                        <CHED H="1">Items</CHED>
                                        <CHED H="1">Categories</CHED>
                                    </BOXHD>
                                    <ROW>
                                        <ENT I="01">Ship propulsion shafts</ENT>
                                        <ENT>Excludes service and landing craft shafts.</ENT>
                                    </ROW>
                                    <ROW>
                                        <ENT I="01">Periscope tubes</ENT>
                                        <ENT>All.</ENT>
                                    </ROW>
                                    <ROW>
                                        <ENT I="01">Ring forgings for bull gears</ENT>
                                        <ENT>All greater than 120 inches in diameter.</ENT>
                                    </ROW>
                                </GPOTABLE>
                                <P>(b) End products and their components delivered under this contract shall contain forging items that are of domestic manufacture only.</P>
                                <P>(c) The restriction in paragraph (b) of this clause may be waived upon request from the Contractor in accordance with subsection 225.7102-3 of the Defense Federal Acquisition Regulation Supplement.</P>
                                <P>(d) The Contractor shall retain records showing compliance with the restriction in paragraph (b) of this clause until 3 years after final payment and shall make the records available upon request of the Contracting Officer.</P>
                                <P>(e) The Contractor shall insert the substance of this clause, including this paragraph (e), in subcontracts for forging items or for other items that contain forging items.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[68 FR 15639, Mar. 31, 2003, as amended at 70 FR 35548, June 21, 2005; 71 FR 39005, July 11, 2006; 74 FR 68384, Dec. 24, 2009]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7026</SECTNO>
                            <SUBJECT>Acquisition Restricted to Products or Services from Afghanistan.</SUBJECT>
                            <P>
                                As prescribed in 225.7703-
                                <E T="03">4</E>
                                (c), use the following clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Acquisition Restricted to Products or Services From Afghanistan (SEP 2013)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>(1) “Product from Afghanistan” means a product that is mined, produced, or manufactured in Afghanistan.</P>
                                <P>(2) “Service from Afghanistan” means a service including construction that is performed in Afghanistan predominantly by citizens or permanent resident aliens of Afghanistan.</P>
                                <P>(b) The Contractor shall provide only products from Afghanistan or services from Afghanistan under this contract.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[78 FR 59859, Sept. 30, 2013]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7027</SECTNO>
                            <SUBJECT>Restriction on contingent fees for foreign military sales.</SUBJECT>
                            <P>As prescribed in 225.7307(a), use the following clause.</P>
                            <EXTRACT>
                                <PRTPAGE P="542"/>
                                <HD SOURCE="HD1">Restriction on Contingent Fees for Foreign Military Sales (APR 2003)</HD>
                                <P>(a) Except as provided in paragraph (b) of this clause, contingent fees, as defined in the Covenant Against Contingent Fees clause of this contract, are generally an allowable cost, provided the fees are paid to—</P>
                                <P>(1) A bona fide employee of the Contractor; or</P>
                                <P>(2) A bona fide established commercial or selling agency maintained by the Contractor for the purpose of securing business.</P>
                                <P>(b) For foreign military sales, unless the contingent fees have been identified and payment approved in writing by the foreign customer before contract award, the following contingent fees are unallowable under this contract:</P>
                                <P>(1) For sales to the Government(s) of ____________________________, contingent fees in any amount.</P>
                                <P>(2) For sales to Governments not listed in paragraph (b)(1) of this clause, contingent fees exceeding $50,000 per foreign military sale case.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[68 FR 15639, Mar. 31, 2003, as amended at 70 FR 73156, Dec. 9, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7028</SECTNO>
                            <SUBJECT>Exclusionary policies and practices of foreign governments.</SUBJECT>
                            <P>As prescribed in 225.7307(b), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Exclusionary Policies and Practices of Foreign Governments (APR 2003)</HD>
                                <P>The Contractor and its subcontractors shall not take into account the exclusionary policies or practices of any foreign government in employing or assigning personnel, if—</P>
                                <P>(a) The personnel will perform functions required by this contract, either in the United States or abroad; and</P>
                                <P>(b) The exclusionary policies or practices of the foreign government are based on race, religion, national origin, or sex.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[68 FR 15639, Mar. 31, 2003, as amended at 70 FR 73156, Dec. 9, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7029</SECTNO>
                            <SUBJECT>Acquisition of Uniform Components for Afghan Military or Afghan National Police.</SUBJECT>
                            <P>As prescribed in 225.7703-4(d), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Acquisition of Uniform Components for Afghan Military or Afghan National Police (SEP 2013)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>“Textile component” means any item consisting of fibers, yarns, or fabric, supplied for incorporation into a uniform or a component of a uniform. It does not include items that do not contain fibers, yarns, or fabric, such as the metallic or plastic elements of buttons, zippers, or other clothing fasteners.</P>
                                <P>“United States” means the 50 States, the District of Columbia, and outlying areas.</P>
                                <P>(b) As required by section 826 of the National Defense Authorization Act for Fiscal Year 2013 (Pub. L. 112-239), the Contractor shall deliver under this contract only textile components that have been produced in the United States.</P>
                                <P>(c) There are no exceptions or waivers to this requirement.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[78 FR 59859, Sept. 30, 2013, as amended at 79 FR 11342, Feb. 28, 2014]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7030</SECTNO>
                            <SUBJECT>Restriction on Acquisition of Carbon, Alloy, and Armor Steel Plate.</SUBJECT>
                            <P>As prescribed in 225.7011-3, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Restriction on Acquisition of Carbon, Alloy, and Armor Steel Plate (DEC 2006)</HD>
                                <P>(a) Carbon, alloy, and armor steel plate shall be melted and rolled in the United States or Canada if the carbon, alloy, or armor steel plate—</P>
                                <P>(1) Is in Federal Supply Class 9515 or is described by specifications of the American Society for Testing Materials or the American Iron and Steel Institute; and</P>
                                <P>(2)(i) Will be delivered to the Government for use in a Government-owned facility or a facility under the control of the Department of Defense; or</P>
                                <P>(ii) Will be purchased by the Contractor for use in a Government-owned facility or a facility under the control of the Department of Defense.</P>
                                <P>(b) This restriction—</P>
                                <P>(1) Applies to the acquisition of carbon, alloy, or armor steel plate as a finished steel mill product that may be used “as is” or may be used as an intermediate material for the fabrication of an end product; and</P>
                                <P>
                                    (2) Does not apply to the acquisition of an end product (
                                    <E T="03">e.g.</E>
                                    , a machine tool), to be used in the facility, that contains carbon, alloy, or armor steel plate as a component.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[71 FR 75894, Dec. 19, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="543"/>
                            <SECTNO>252.225-7031</SECTNO>
                            <SUBJECT>Secondary Arab boycott of Israel.</SUBJECT>
                            <P>As prescribed in 225.7605, use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Secondary Arab Boycott of Israel (JUN 2005)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this provision—
                                </P>
                                <P>
                                    (1) 
                                    <E T="03">Foreign person</E>
                                     means any person (including any individual, partnership, corporation, or other form of association) other than a United States person.
                                </P>
                                <P>
                                    (2) 
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, outlying areas, and the outer Continental Shelf as defined in 43 U.S.C. 1331.
                                </P>
                                <P>
                                    (3) 
                                    <E T="03">United States person</E>
                                     is defined in 50 U.S.C. App. 2415(2) and means—
                                </P>
                                <P>(i) Any United States resident or national (other than an individual resident outside the United States who is employed by other than a United States person);</P>
                                <P>(ii) Any domestic concern (including any permanent domestic establishment of any foreign concern); and</P>
                                <P>(iii) Any foreign subsidiary or affiliate (including any permanent foreign establishment) of any domestic concern that is controlled in fact by such domestic concern.</P>
                                <P>
                                    (b) 
                                    <E T="03">Certification.</E>
                                     If the offeror is a foreign person, the offeror certifies, by submission of an offer, that it—
                                </P>
                                <P>(1) Does not comply with the Secondary Arab Boycott of Israel; and</P>
                                <P>(2) Is not taking or knowingly agreeing to take any action, with respect to the Secondary Boycott of Israel by Arab countries, which 50 U.S.C. App. 2407(a) prohibits a United States person from taking.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[68 FR 15639, Mar. 31, 2003, as amended at 70 FR 35548, June 21, 2005; 71 FR 39006, July 11, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7032</SECTNO>
                            <SUBJECT>Waiver of United Kingdom Levies—Evaluation of offers.</SUBJECT>
                            <P>As prescribed in 225.1101(7), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Waiver of United Kingdom Levies—Evaluation of Offers (APR 2003)</HD>
                                <P>(a) Offered prices for contracts or subcontracts with United Kingdom (U.K.) firms may contain commercial exploitation levies assessed by the Government of the U.K. The offeror shall identify to the Contracting Officer all levies included in the offered price by describing—</P>
                                <P>(1) The name of the U.K. firm;</P>
                                <P>(2) The item to which the levy applies and the item quantity; and</P>
                                <P>(3) The amount of levy plus any associated indirect costs and profit or fee.</P>
                                <P>(b) In the event of difficulty in identifying levies included in a price from a prospective subcontractor, the offeror may seek advice through the Director of Procurement, United Kingdom Defence Procurement Office, British Embassy, 3100 Massachusetts Avenue NW., Washington, DC 20006.</P>
                                <P>(c) The U.S. Government may attempt to obtain a waiver of levies pursuant to the U.S./U.K. reciprocal waiver agreement of July 1987.</P>
                                <P>(1) If the U.K. waives levies before award of a contract, the Contracting Officer will evaluate the offer without the levy.</P>
                                <P>(2) If levies are identified but not waived before award of a contract, the Contracting Officer will evaluate the offer inclusive of the levies.</P>
                                <P>(3) If the U.K. grants a waiver of levies after award of a contract, the U.S. Government reserves the right to reduce the contract price by the amount of the levy waived plus associated indirect costs and profit or fee.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[68 FR 15639, Mar. 31, 2003, as amended at 73 FR 53155, Sept. 15, 2008; 78 FR 59859, Sept. 30, 2013]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7033</SECTNO>
                            <SUBJECT>Waiver of United Kingdom levies.</SUBJECT>
                            <P>As prescribed in 225.1101(8), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Waiver of United Kingdom Levies (APR 2003)</HD>
                                <P>(a) The U.S. Government may attempt to obtain a waiver of any commercial exploitation levies included in the price of this contract, pursuant to the U.S./United Kingdom (U.K.) reciprocal waiver agreement of July 1987. If the U.K. grants a waiver of levies included in the price of this contract, the U.S. Government reserves the right to reduce the contract price by the amount of the levy waived plus associated indirect costs and profit or fee.</P>
                                <P>(b) If the Contractor contemplates award of a subcontract exceeding $1 million to a U.K. firm, the Contractor shall provide the following information to the Contracting Officer before award of the subcontract:</P>
                                <P>(1) Name of the U.K. firm.</P>
                                <P>(2) Prime contract number.</P>
                                <P>(3) Description of item to which the levy applies.</P>
                                <P>(4) Quantity being acquired.</P>
                                <P>(5) Amount of levy plus any associated indirect costs and profit or fee.</P>
                                <P>
                                    (c) In the event of difficulty in identifying levies included in a price from a prospective subcontractor, the Contractor may seek advice through the Director of Procurement, 
                                    <PRTPAGE P="544"/>
                                    United Kingdom Defence Procurement Office, British Embassy, 3100 Massachusetts Avenue NW., Washington, DC 20006.
                                </P>
                                <P>(d) The Contractor shall insert the substance of this clause, including this paragraph (d), in any subcontract for supplies where a lower-tier subcontract exceeding $1 million with a U.K. firm is anticipated.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[68 FR 15639, Mar. 31, 2003, as amended at 73 FR 53155, Sept. 15, 2008; 78 FR 59859, Sept. 30, 2013]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7034</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7035</SECTNO>
                            <SUBJECT>Buy American—Free Trade Agreements—Balance of Payments Program Certificate.</SUBJECT>
                            <P>
                                <E T="03">Basic.</E>
                                 As prescribed in 225.1101(9) and (9)(i), use the following provision:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Buy American—Free Trade Agreements—Balance of Payments Program Certificate—Basic (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     “Bahraini end product,” “commercially available off-the-shelf (COTS) item,” “component,” “critical component,” “critical item,” “domestic end product,” “Free Trade Agreement country,” “Free Trade Agreement country end product,” “foreign end product,” “Moroccan end product,” “Panamanian end product,” “Peruvian end product,” “qualifying country end product,” and “United States,” as used in this provision, have the meanings given in the “252.225-7036, Buy American”—Free Trade Agreements—Balance of Payments Program—Basic clause of this solicitation.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Evaluation.</E>
                                     The Government—
                                </P>
                                <P>(1) Will evaluate offers in accordance with the policies and procedures of part 225 of the Defense Federal Acquisition Regulation Supplement; and</P>
                                <P>(2) For line items subject to Buy American—Free Trade Agreements—Balance of Payments Program—Basic clause of this solicitation, will evaluate offers of qualifying country end products or Free Trade Agreement country end products other than Bahraini end products, Moroccan end products, Panamanian end products, or Peruvian end products without regard to the restrictions of the Buy American or the Balance of Payments Program.</P>
                                <P>
                                    (c) 
                                    <E T="03">Certifications and identification of country of origin.</E>
                                </P>
                                <P>(1) For all line items subject to the Buy American—Free Trade Agreements—Balance of Payments Program—Basic clause of this solicitation, the Offeror certifies that—</P>
                                <P>(i) Each end product, except the end products listed in paragraph (c)(2) of this provision, is a domestic end product;</P>
                                <P>(ii) Each domestic end product listed in paragraph (c)(3) of this provision contains a critical component or a critical item; and</P>
                                <P>(iii) Components of unknown origin are considered to have been mined, produced, or manufactured outside the United States or a qualifying country.</P>
                                <P>(2) The Offeror shall identify all end products that are not domestic end products.</P>
                                <P>(i) The Offeror certifies that the following supplies are qualifying country (except Australian) end products:</P>
                                <GPOTABLE COLS="2" OPTS="L0,tp0,p0,8/9,g1,t1" CDEF="10C,10C">
                                    <BOXHD>
                                        <CHED H="1"> </CHED>
                                        <CHED H="1"> </CHED>
                                    </BOXHD>
                                    <ROW>
                                        <ENT I="01">Line item No.</ENT>
                                        <ENT>Country of origin</ENT>
                                    </ROW>
                                </GPOTABLE>
                                <P>(ii) The Offeror certifies that the following supplies are Free Trade Agreement country end products other than Bahraini end products, Moroccan end products, Panamanian end products or Peruvian end products:</P>
                                <GPOTABLE COLS="2" OPTS="L0,tp0,p0,8/9,g1,t1" CDEF="10C,10C">
                                    <BOXHD>
                                        <CHED H="1"> </CHED>
                                        <CHED H="1"> </CHED>
                                    </BOXHD>
                                    <ROW>
                                        <ENT I="01">Line item No.</ENT>
                                        <ENT>Country of origin</ENT>
                                    </ROW>
                                </GPOTABLE>
                                <P>(iii) The following supplies are other foreign end products, including end products manufactured in the United States that do not qualify as domestic end products. For those foreign end products that do not consist wholly or predominantly of iron or steel or a combination of both, the Offeror shall also indicate whether these foreign end products exceed 55 percent domestic content, except those that are COTS items. If the percentage of the domestic content is unknown, select “no”.</P>
                                <GPOTABLE COLS="3" OPTS="L2" CDEF="s75,r75,r75">
                                    <BOXHD>
                                        <CHED H="1">Line item No.</CHED>
                                        <CHED H="1">
                                            Country of origin
                                            <LI>(if known)</LI>
                                        </CHED>
                                        <CHED H="1">
                                            Exceeds 55% domestic content
                                            <LI>(yes/no)</LI>
                                        </CHED>
                                    </BOXHD>
                                    <ROW RUL="s">
                                        <ENT I="22"> </ENT>
                                    </ROW>
                                    <ROW RUL="s">
                                        <ENT I="22"> </ENT>
                                    </ROW>
                                    <ROW>
                                        <ENT I="22"> </ENT>
                                    </ROW>
                                </GPOTABLE>
                                <P>(3) The Offeror shall list the line item numbers of domestic end products that contain a critical component or a critical item (see section 25.105 of the Federal Acquisition Regulation).</P>
                                <FP SOURCE="FP-DASH">Line Item Number:</FP>
                                <FP>
                                    <E T="03">[List as necessary]</E>
                                </FP>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <P>
                                <E T="03">Alternate I.</E>
                                 As prescribed in 225.1101(9) and (9)(ii), use the following 
                                <PRTPAGE P="545"/>
                                provision, which does not use the phrases “Bahraini end product,” “Free Trade Agreement country,” “Free Trade Agreement country end product,” “Moroccan end product,” “Panamanian end product,” and “Peruvian end products” in paragraph (a); does not use “Free Trade Agreement country end products other than Bahraini end products, Moroccan end products, Panamanian end products, or Peruvian end products” in paragraphs (b)(2) and (c)(2)(ii); does not use “Australian or” in paragraph (c)(2)(i); and includes “that are mined, produced, or manufactured in the United States” in paragraph (c)(2)(ii):
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Buy American—Free Trade Agreements—Balance of Payments Program Certificate—Alternate I (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions. Commercially available off-the-shelf (COTS) item,</E>
                                     
                                    <E T="03">component, critical component, critical item, domestic end product,</E>
                                     
                                    <E T="03">foreign end product, qualifying country end product,</E>
                                     and 
                                    <E T="03">United States,</E>
                                     as used in this provision, have the meanings given in the 252.225-7036, Buy American—Free Trade Agreements—Balance of Payments Program—Alternate I clause of this solicitation.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Evaluation.</E>
                                     The Government—
                                </P>
                                <P>(1) Will evaluate offers in accordance with the policies and procedures of part 225 of the Defense Federal Acquisition Regulation Supplement; and</P>
                                <P>(2) For line items subject to the Buy American—Free Trade Agreements—Balance of Payments Program—Alternate I clause of this solicitation, will evaluate offers of qualifying country end products without regard to the restrictions of the Buy American or the Balance of Payments Program.</P>
                                <P>
                                    (c) 
                                    <E T="03">Certifications and identification of country of origin.</E>
                                </P>
                                <P>(1) For all line items subject to the Buy American—Free Trade Agreements—Balance of Payments Program—Alternate I clause of this solicitation, the Offeror certifies that—</P>
                                <P>(i) Each end product, except the end products listed in paragraph (c)(2) of this provision, is a domestic end product;</P>
                                <P>(ii) Each domestic end product listed in paragraph (c)(3) of this provision contains a critical component or a critical item; and</P>
                                <P>(iii) Components of unknown origin are considered to have been mined, produced, or manufactured outside the United States or a qualifying country.</P>
                                <P>(2) The Offeror shall identify all end products that are not domestic end products.</P>
                                <P>(i) The Offeror certifies that the following supplies are qualifying country end products:</P>
                                <GPOTABLE COLS="2" OPTS="L0,tp0,p0,8/9,g1,t1" CDEF="10C,10C">
                                    <BOXHD>
                                        <CHED H="1"> </CHED>
                                        <CHED H="1"> </CHED>
                                    </BOXHD>
                                    <ROW>
                                        <ENT I="01">Line item No.</ENT>
                                        <ENT>Country of origin</ENT>
                                    </ROW>
                                </GPOTABLE>
                                <P>(ii) The following supplies are other foreign end products, including end products manufactured in the United States that do not qualify as domestic end products. For those foreign end products that do not consist wholly or predominantly of iron or steel or a combination of both, the Offeror shall also indicate whether these foreign end products exceed 55 percent domestic content, except those that are COTS items that are mined, produced, or manufactured in the United States. If the percentage of the domestic content is unknown, select “no”.</P>
                                <GPOTABLE COLS="3" OPTS="L2" CDEF="s75,r75,r75">
                                    <BOXHD>
                                        <CHED H="1">Line item No.</CHED>
                                        <CHED H="1">
                                            Country of origin
                                            <LI>(if known)</LI>
                                        </CHED>
                                        <CHED H="1">
                                            Exceeds 55% domestic content
                                            <LI>(yes/no)</LI>
                                        </CHED>
                                    </BOXHD>
                                    <ROW RUL="s">
                                        <ENT I="22"> </ENT>
                                    </ROW>
                                    <ROW RUL="s">
                                        <ENT I="22"> </ENT>
                                    </ROW>
                                    <ROW>
                                        <ENT I="22"> </ENT>
                                    </ROW>
                                </GPOTABLE>
                                <P>(3) The Offeror shall list the line item numbers of domestic end products that contain a critical component or a critical item (see section 25.105 of the Federal Acquisition Regulation).</P>
                                <FP SOURCE="FP-DASH">Line Item Number:</FP>
                                <FP>
                                    <E T="03">[List as necessary]</E>
                                </FP>
                                <HD SOURCE="HD3">(End of provision)</HD>
                                <P>
                                    <E T="03">Alternate II.</E>
                                     As prescribed in 225.1101(9) and (9)(iii), use the following provision, which adds 
                                    <E T="03">South Caucasus/Central and South Asian (SC/CASA) state</E>
                                     and 
                                    <E T="03">South Caucasus/Central and South Asian (SC/CASA) state end product</E>
                                     to paragraph (a), and uses different paragraphs (b)(2) and (c)(2)(i) than the basic provision:
                                </P>
                                <HD SOURCE="HD1">Buy American—Free Trade Agreements—Balance of Payments Program Certificate—Alternate II (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions. Bahraini end product, commercially available off-the-shelf (COTS) item,</E>
                                     
                                    <E T="03">component, critical component, critical item, domestic end product,</E>
                                     
                                    <E T="03">Free Trade Agreement country, Free Trade Agreement country end product,</E>
                                     
                                    <E T="03">foreign end product, Moroccan end product,</E>
                                     
                                    <E T="03">Panamanian end product, Peruvian end product,</E>
                                     
                                    <E T="03">qualifying country end product, South Caucasus/Central and South Asian (SC/CASA) state,</E>
                                     
                                    <E T="03">
                                        South Caucasus/Central and South Asian 
                                        <PRTPAGE P="546"/>
                                        (SC/CASA) state end product,
                                    </E>
                                     and 
                                    <E T="03">United States,</E>
                                     as used in this provision, have the meanings given in the 252.225-7036, Buy American—Free Trade Agreements—Balance of Payments Program—Alternate II clause of this solicitation.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Evaluation.</E>
                                     The Government—
                                </P>
                                <P>(1) Will evaluate offers in accordance with the policies and procedures of part 225 of the Defense Federal Acquisition Regulation Supplement; and</P>
                                <P>(2) For line items subject to the Buy American—Free Trade Agreements—Balance of Payments Program—Alternate II clause of this solicitation, will evaluate offers of qualifying country end products, SC/CASA state end products, or Free Trade Agreement country end products other than Bahraini end products, Moroccan end products, Panamanian end products, or Peruvian end products without regard to the restrictions of the Buy American or the Balance of Payments Program.</P>
                                <P>
                                    (c) 
                                    <E T="03">Certifications and identification of country of origin.</E>
                                </P>
                                <P>(1) For all line items subject to the Buy American—Free Trade Agreements—Balance of Payments Program—Alternate II clause of this solicitation, the Offeror certifies that—</P>
                                <P>(i) Each end product, except the end products listed in paragraph (c)(2) of this provision, is a domestic end product;</P>
                                <P>(ii) Each domestic end product listed in paragraph (c)(3) of this provision contains a critical component or a critical item; and</P>
                                <P>(iii) Components of unknown origin are considered to have been mined, produced, or manufactured outside the United States or a qualifying country.</P>
                                <P>(2) The Offeror shall identify all end products that are not domestic end products.</P>
                                <P>(i) The Offeror certifies that the following supplies are qualifying country (except Australian) or SC/CASA state end products:</P>
                                <GPOTABLE COLS="2" OPTS="L0,tp0,p0,8/9,g1,t1" CDEF="10C,10C">
                                    <BOXHD>
                                        <CHED H="1"> </CHED>
                                        <CHED H="1"> </CHED>
                                    </BOXHD>
                                    <ROW>
                                        <ENT I="01">Line item No.</ENT>
                                        <ENT>Country of origin</ENT>
                                    </ROW>
                                </GPOTABLE>
                                <P>(ii) The Offeror certifies that the following supplies are Free Trade Agreement country end products other than Bahraini end products, Moroccan end products, Panamanian end products, or Peruvian end products:</P>
                                <GPOTABLE COLS="2" OPTS="L0,tp0,p0,8/9,g1,t1" CDEF="10C,10C">
                                    <BOXHD>
                                        <CHED H="1"> </CHED>
                                        <CHED H="1"> </CHED>
                                    </BOXHD>
                                    <ROW>
                                        <ENT I="01">Line item No.</ENT>
                                        <ENT>Country of origin</ENT>
                                    </ROW>
                                </GPOTABLE>
                                <P>(iii) The following supplies are other foreign end products, including end products manufactured in the United States that do not qualify as domestic end products. For those foreign end products that do not consist wholly or predominantly of iron or steel or a combination of both, the Offeror shall also indicate whether these foreign end products exceed 55 percent domestic content, except those that are COTS items. If the percentage of the domestic content is unknown, select “no”.</P>
                                <GPOTABLE COLS="3" OPTS="L2" CDEF="s75,r75,r75">
                                    <BOXHD>
                                        <CHED H="1">Line item No.</CHED>
                                        <CHED H="1">
                                            Country of origin
                                            <LI>(if known)</LI>
                                        </CHED>
                                        <CHED H="1">
                                            Exceeds 55% domestic content
                                            <LI>(yes/no)</LI>
                                        </CHED>
                                    </BOXHD>
                                    <ROW RUL="s">
                                        <ENT I="22"> </ENT>
                                    </ROW>
                                    <ROW RUL="s">
                                        <ENT I="22"> </ENT>
                                    </ROW>
                                    <ROW>
                                        <ENT I="22"> </ENT>
                                    </ROW>
                                </GPOTABLE>
                                <P>(3) The Offeror shall list the line item numbers of domestic end products that contain a critical component or a critical item (see section 25.105 of the Federal Acquisition Regulation).</P>
                                <FP SOURCE="FP-DASH">Line Item Number:</FP>
                                <FP>
                                    <E T="03">[List as necessary]</E>
                                </FP>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <P>
                                <E T="03">Alternate III.</E>
                                 As prescribed in 225.1101(9) and (9)(iv), use the following provision, which uses different paragraphs (a), (b)(2), (c)(2)(i), and (c)(2)(ii) than the basic provision:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Buy American—Free Trade Agreements—Balance of Payments Program Certificate—Alternate III (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions. Commercially available off-the-shelf (COTS) item,</E>
                                     
                                    <E T="03">domestic end product, foreign end product,</E>
                                     
                                    <E T="03">qualifying country end product, South Caucasus/Central and South Asian (SC/CASA) state end product,</E>
                                     and 
                                    <E T="03">United States,</E>
                                     as used in this provision have the meanings given in the 252.225-7036, Buy American—Free Trade Agreements—Balance of Payments Program—Alternate III clause of this solicitation.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Evaluation.</E>
                                     The Government—
                                </P>
                                <P>(1) Will evaluate offers in accordance with the policies and procedures of part 225 of the Defense Federal Acquisition Regulation Supplement; and</P>
                                <P>(2) For line items subject to the Buy American—Free Trade Agreements—Balance of Payments Program—Alternate III clause of this solicitation, will evaluate offers of qualifying country end products or SC/CASA state end products without regard to the restrictions of the Buy American or the Balance of Payments Program.</P>
                                <P>
                                    (c) Certifications and identification of country of origin.
                                    <PRTPAGE P="547"/>
                                </P>
                                <P>(1) For all line items subject to the Buy American—Free Trade Agreements—Balance of Payments Program—Alternate III clause of this solicitation, the Offeror certifies that—</P>
                                <P>(i) Each end product, except the end products listed in paragraph (c)(2) of this provision, is a domestic end product;</P>
                                <P>(ii) Each domestic end product listed in paragraph (c)(3) of this provision contains a critical component or a critical item; and</P>
                                <P>(iii) Components of unknown origin are considered to have been mined, produced, or manufactured outside the United States or a qualifying country.</P>
                                <P>(2) The Offeror shall identify all end products that are not domestic end products.</P>
                                <P>(i) The Offeror certifies that the following supplies are qualifying country or SC/CASA state end products:</P>
                                <GPOTABLE COLS="2" OPTS="L0,tp0,p0,8/9,g1,t1" CDEF="10C,10C">
                                    <BOXHD>
                                        <CHED H="1"> </CHED>
                                        <CHED H="1"> </CHED>
                                    </BOXHD>
                                    <ROW>
                                        <ENT I="01">Line item No.</ENT>
                                        <ENT>Country of origin</ENT>
                                    </ROW>
                                </GPOTABLE>
                                <P>(ii) The Offeror certifies that the following supplies are Free Trade Agreement country end products other than Bahraini end products, Moroccan end products, Panamanian end products, or Peruvian end products:</P>
                                <GPOTABLE COLS="2" OPTS="L0,tp0,p0,8/9,g1,t1" CDEF="10C,10C">
                                    <BOXHD>
                                        <CHED H="1"> </CHED>
                                        <CHED H="1"> </CHED>
                                    </BOXHD>
                                    <ROW>
                                        <ENT I="01">Line item No.</ENT>
                                        <ENT>Country of origin</ENT>
                                    </ROW>
                                </GPOTABLE>
                                <P>(iii) The following supplies are other foreign end products, including end products manufactured in the United States that do not qualify as domestic end products. For those foreign end products that do not consist wholly or predominantly of iron or steel or a combination of both, the Offeror shall also indicate whether these foreign end products exceed 55 percent domestic content, except those that are COTS items. If the percentage of the domestic content is unknown, select “no”.</P>
                                <GPOTABLE COLS="3" OPTS="L2" CDEF="s75,r75,r75">
                                    <BOXHD>
                                        <CHED H="1">Line item No.</CHED>
                                        <CHED H="1">
                                            Country of origin
                                            <LI>(if known)</LI>
                                        </CHED>
                                        <CHED H="1">
                                            Exceeds 55% domestic content
                                            <LI>(yes/no)</LI>
                                        </CHED>
                                    </BOXHD>
                                    <ROW RUL="s">
                                        <ENT I="22"> </ENT>
                                    </ROW>
                                    <ROW RUL="s">
                                        <ENT I="22"> </ENT>
                                    </ROW>
                                    <ROW>
                                        <ENT I="22"> </ENT>
                                    </ROW>
                                </GPOTABLE>
                                <P>(3) The Offeror shall list the line item numbers of domestic end products that contain a critical component or a critical item (see section 25.105 of the Federal Acquisition Regulation).</P>
                                <FP SOURCE="FP-DASH">Line Item Number:</FP>
                                <FP>
                                    <E T="03">[List as necessary]</E>
                                </FP>
                                <HD SOURCE="HD3">(End of provision)</HD>
                                <P>
                                    <E T="03">Alternate IV.</E>
                                     As prescribed in 225.1101(9) and (9)(v), use the following provision, which adds 
                                    <E T="03">Korean end product</E>
                                     to paragraph (a); and uses “Free Trade Agreement country end products other than Bahraini end products, Korean end products, Moroccan end products, Panamanian end products, or Peruvian end products” in paragraphs (b)(2) and (c)(2)(ii), rather than “Free Trade Agreement country end products other than Bahraini end products, Moroccan end products, Panamanian end products, or Peruvian end products” in paragraphs (b)(2) and (c)(2)(ii) of the basic provision:
                                </P>
                                <HD SOURCE="HD1">Buy American—Free Trade Agreements—Balance of Payments Program Certificate—Alternate IV (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions. Bahraini end product, commercially available off-the-shelf (COTS) item,</E>
                                     
                                    <E T="03">component, critical component, critical item,  domestic end product,</E>
                                     
                                    <E T="03">Free Trade Agreement country, Free Trade Agreement country end product,</E>
                                     
                                    <E T="03">foreign end product, Korean end product,</E>
                                     
                                    <E T="03">Moroccan end product, Panamanian end product,</E>
                                     
                                    <E T="03">Peruvian end product, qualifying country end product,</E>
                                     and 
                                    <E T="03">United States,</E>
                                     as used in this provision, have the meanings given in the 252-225-7036, Buy American—Free Trade Agreements—Balance of Payments Program—Alternate IV clause of this solicitation.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Evaluation.</E>
                                     The Government—
                                </P>
                                <P>(1) Will evaluate offers in accordance with the policies and procedures of part 225 of the Defense Federal Acquisition Regulation Supplement; and</P>
                                <P>(2) For line items subject to the Buy American—Free Trade Agreements—Balance of Payments Program—Alternate IV clause of this solicitation, will evaluate offers of qualifying country end products or Free Trade Agreement country end products other than Bahraini end products, Korean end products, Moroccan end products, Panamanian end products, or Peruvian end products without regard to the restrictions of the Buy American or the Balance of Payments Program.</P>
                                <P>
                                    (c) 
                                    <E T="03">Certifications and identification of country of origin.</E>
                                </P>
                                <P>(1) For all line items subject to the Buy American—Free Trade Agreements—Balance of Payments Program—Alternate IV clause of this solicitation, the Offeror certifies that—</P>
                                <P>
                                    (i) Each end product, except the end products listed in paragraph (c)(2) of this provision, is a domestic end product;
                                    <PRTPAGE P="548"/>
                                </P>
                                <P>(ii) Each domestic end product listed in paragraph (c)(3) of this provision contains a critical component or a critical item; and</P>
                                <P>(iii) Components of unknown origin are considered to have been mined, produced, or manufactured outside the United States or a qualifying country.</P>
                                <P>(2) The Offeror shall identify all end products that are not domestic end products.</P>
                                <P>(i) The Offeror certifies that the following supplies are qualifying country (except Australian) end products:</P>
                                <GPOTABLE COLS="2" OPTS="L0,tp0,p0,8/9,g1,t1" CDEF="10C,10C">
                                    <BOXHD>
                                        <CHED H="1"> </CHED>
                                        <CHED H="1"> </CHED>
                                    </BOXHD>
                                    <ROW>
                                        <ENT I="01">Line item No.</ENT>
                                        <ENT>Country of origin</ENT>
                                    </ROW>
                                </GPOTABLE>
                                <P>(ii) The Offeror certifies that the following supplies are Free Trade Agreement country end products other than Bahraini end products, Korean end products, Moroccan end products, Panamanian end products, or Peruvian end products:</P>
                                <GPOTABLE COLS="2" OPTS="L0,tp0,p0,8/9,g1,t1" CDEF="10C,10C">
                                    <BOXHD>
                                        <CHED H="1"> </CHED>
                                        <CHED H="1"> </CHED>
                                    </BOXHD>
                                    <ROW>
                                        <ENT I="01">Line item No.</ENT>
                                        <ENT>Country of origin</ENT>
                                    </ROW>
                                </GPOTABLE>
                                <P>(iii) The following supplies are other foreign end products, including end products manufactured in the United States that do not qualify as domestic end products. For those foreign end products that do not consist wholly or predominantly of iron or steel or a combination of both, the Offeror shall also indicate whether these foreign end products exceed 55 percent domestic content, except those that are COTS items. If the percentage of the domestic content is unknown, select “no”.</P>
                                <GPOTABLE COLS="3" OPTS="L2" CDEF="s75,r75,r75">
                                    <BOXHD>
                                        <CHED H="1">Line item No.</CHED>
                                        <CHED H="1">
                                            Country of origin
                                            <LI>(if known)</LI>
                                        </CHED>
                                        <CHED H="1">
                                            Exceeds 55% domestic content
                                            <LI>(yes/no)</LI>
                                        </CHED>
                                    </BOXHD>
                                    <ROW RUL="s">
                                        <ENT I="22"> </ENT>
                                    </ROW>
                                    <ROW RUL="s">
                                        <ENT I="22"> </ENT>
                                    </ROW>
                                    <ROW>
                                        <ENT I="22"> </ENT>
                                    </ROW>
                                </GPOTABLE>
                                <P>(3) The Offeror shall list the line item numbers of domestic end products that contain a critical component or a critical item (see section 25.105 of the Federal Acquisition Regulation).</P>
                                <FP SOURCE="FP-DASH">Line Item Number:</FP>
                                <FP>
                                    <E T="03">[List as necessary]</E>
                                </FP>
                                <P>
                                    <E T="03">Alternate V.</E>
                                     As prescribed in 225.1101(9) and (9)(vi), use the following provision, which uses different paragraphs (a), (b)(2), (c)(2)(i), and (c)(2)(ii) than the basic provision:
                                </P>
                                <HD SOURCE="HD1">Buy American—Free Trade Agreements—Balance of Payments Program Certificate—Alternate V (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions. Bahraini end product, commercially available off-the-shelf (COTS) item,</E>
                                     
                                    <E T="03">component, critical component, critical item, domestic end product,</E>
                                     “
                                    <E T="03">Free Trade Agreement country, Free Trade Agreement country end product,</E>
                                     
                                    <E T="03">foreign end product, Korean end product,</E>
                                     
                                    <E T="03">Moroccan end product, Panamanian end product,</E>
                                     
                                    <E T="03">Peruvian end product, qualifying country end product,</E>
                                     
                                    <E T="03">South Caucasus/Central and South Asian (SC/CASA) state end product,</E>
                                     and 
                                    <E T="03">United States,</E>
                                     as used in this provision, have the meanings given in the 252.225-7036, Buy American—Free Trade Agreements—Balance of Payments Program—Alternate V clause of this solicitation.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Evaluation.</E>
                                     The Government—
                                </P>
                                <P>(1) Will evaluate offers in accordance with the policies and procedures of part 225 of the Defense Federal Acquisition Regulation Supplement; and</P>
                                <P>(2) For line items subject to the Buy American—Free Trade Agreements—Balance of Payments Program—Alternate V clause of this solicitation, will evaluate offers of qualifying country end products, SC/CASA state end products, or Free Trade Agreement end products other than Bahraini end products, Korean end products, Moroccan end products, Panamanian end products, or Peruvian end products without regard to the restrictions of the Buy American statute or the Balance of Payments Program.</P>
                                <P>
                                    (c) 
                                    <E T="03">Certifications and identification of country of origin.</E>
                                </P>
                                <P>(1) For all line items subject to the Buy American—Free Trade Agreements—Balance of Payments Program—Alternate V clause of this solicitation, the Offeror certifies that—</P>
                                <P>(i) Each end product, except the end products listed in paragraph (c)(2) of this provision, is a domestic end product;</P>
                                <P>(ii) Each domestic end product listed in paragraph (c)(3) of this provision contains a critical component or a critical item; and</P>
                                <P>(iii) Components of unknown origin are considered to have been mined, produced, or manufactured outside the United States or a qualifying country.</P>
                                <P>(2) The Offeror shall identify all end products that are not domestic end products.</P>
                                <P>(i) The Offeror certifies that the following supplies are qualifying country (except Australian) or SC/CASA state end products:</P>
                                <GPOTABLE COLS="2" OPTS="L0,tp0,p0,8/9,g1,t1" CDEF="10C,10C">
                                    <BOXHD>
                                        <CHED H="1"> </CHED>
                                        <CHED H="1"> </CHED>
                                    </BOXHD>
                                    <ROW>
                                        <ENT I="01">Line item No.</ENT>
                                        <ENT>Country of origin</ENT>
                                    </ROW>
                                </GPOTABLE>
                                <P>(ii) The Offeror certifies that the following supplies are Free Trade Agreement country end products other than Bahraini end products, Korean end products, Moroccan end products, Panamanian end products, or Peruvian end products:</P>
                                <GPOTABLE COLS="2" OPTS="L0,tp0,p0,8/9,g1,t1" CDEF="10C,10C">
                                    <BOXHD>
                                        <CHED H="1"> </CHED>
                                        <CHED H="1"> </CHED>
                                    </BOXHD>
                                    <ROW>
                                        <ENT I="01">Line item No.</ENT>
                                        <ENT>Country of origin</ENT>
                                    </ROW>
                                </GPOTABLE>
                                <PRTPAGE P="549"/>
                                <P>(iii) The following supplies are other foreign end products, including end products manufactured in the United States that do not qualify as domestic end products. For those foreign end products that do not consist wholly or predominantly of iron or steel or a combination of both, the Offeror shall also indicate whether these foreign end products exceed 55 percent domestic content, except those that are COTS items. If the percentage of the domestic content is unknown, select “no”.</P>
                                <GPOTABLE COLS="3" OPTS="L2" CDEF="s75,r75,r75">
                                    <BOXHD>
                                        <CHED H="1">Line item No.</CHED>
                                        <CHED H="1">
                                            Country of origin
                                            <LI>(if known)</LI>
                                        </CHED>
                                        <CHED H="1">
                                            Exceeds 55% domestic content
                                            <LI>(yes/no)</LI>
                                        </CHED>
                                    </BOXHD>
                                    <ROW RUL="s">
                                        <ENT I="22"> </ENT>
                                    </ROW>
                                    <ROW RUL="s">
                                        <ENT I="22"> </ENT>
                                    </ROW>
                                    <ROW>
                                        <ENT I="22"> </ENT>
                                    </ROW>
                                </GPOTABLE>
                                <P>(3) The Offeror shall list the line item numbers of domestic end products that contain a critical component or a critical item (see section 25.105 of the Federal Acquisition Regulation).</P>
                                <FP SOURCE="FP-DASH">Line Item Number:</FP>
                                <FP>
                                    <E T="03">[List as necessary]</E>
                                </FP>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[70 FR 2364, Jan. 13, 2005]</CITA>
                            <EDNOTE>
                                <HD SOURCE="HED">Editorial Note:</HD>
                                <P>
                                    For 
                                    <E T="04">Federal Register</E>
                                     citations affecting section 252.225-7035, see the List of CFR Sections Affected, which appears in the Finding Aids section of the printed volume and at 
                                    <E T="03">www.govinfo.gov.</E>
                                </P>
                            </EDNOTE>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7036</SECTNO>
                            <SUBJECT>Buy American—Free Trade Agreements—Balance of Payments Program.</SUBJECT>
                            <P>
                                <E T="03">Basic.</E>
                                 As prescribed in 225.1101(10)(i) and (10)(i)(A), use the following clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Buy American—Free Trade Agreements—Balance of Payments Program—Basic (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Bahraini end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Bahrain; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Bahrain into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Commercially available off-the-shelf (COTS) item</E>
                                    —
                                </P>
                                <P>(1) Means any item of supply (including construction material) that is—</P>
                                <P>(i) A commercial product (as defined in paragraph (1) of the definition of “commercial product” in section 2.101 of the Federal Acquisition Regulation (FAR));</P>
                                <P>(ii) Sold in substantial quantities in the commercial marketplace; and</P>
                                <P>(iii) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and</P>
                                <P>(2) Does not include bulk cargo, as defined in 46 U.S.C. 40102(4), such as agricultural products and petroleum products.</P>
                                <P>
                                    <E T="03">Component</E>
                                     means an article, material, or supply incorporated directly into an end product.
                                </P>
                                <P>
                                    <E T="03">Critical component</E>
                                     means a component that is mined, produced, or manufactured in the United States and deemed critical to the U.S. supply chain. The list of critical components is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Critical item</E>
                                     means domestic construction material or a domestic end product that is deemed critical to the U.S. supply chain. The list of critical items is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Domestic end product</E>
                                     means—
                                </P>
                                <P>(1) For an end product that does not consist wholly or predominantly of iron or steel or a combination of both—</P>
                                <P>(i) An unmanufactured end product mined or produced in the United States; or</P>
                                <P>(ii) An end product manufactured in the United States if—</P>
                                <P>
                                    (A) The cost of its qualifying country components and its components that are mined, produced, or manufactured in the United States exceeds 60 percent of the cost of all its components, except that the percentage will be 65 percent for items delivered in calendar years 2024 through 2028 and 75 percent for items delivered starting in calendar year 2029, unless an alternate percentage is established for a contract in accordance with Defense Federal Acquisition Regulation Supplement (DFARS) 225.101(d); or award is made before January 1, 2030, for a foreign end product that exceeds 55 percent domestic content (see DFARS 225.103(b)(ii)). The cost 
                                    <PRTPAGE P="550"/>
                                    of components includes transportation costs to the place of incorporation into the end product and U.S. duty (whether or not a duty-free entry certificate is issued). Components of unknown origin are treated as foreign. Scrap generated, collected, and prepared for processing in the United States is considered domestic. A component is considered to have been mined, produced, or manufactured in the United States (regardless of its source in fact) if the end product in which it is incorporated is manufactured in the United States and the component is of a class or kind for which the Government has determined that—
                                </P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) Sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States; or
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) It is inconsistent with the public interest to apply the restrictions of the Buy American statute; or
                                </P>
                                <P>(B) The end product is a COTS item; or</P>
                                <P>(2) For an end product that consists wholly or predominantly of iron or steel or a combination of both, an end product manufactured in the United States, if the cost of iron and steel not produced in the United States or a qualifying country constitutes less than 5 percent of the cost of all the components used in the end product (produced in the United States or a qualifying country means that all manufacturing processes of the iron or steel must take place in the United States or a qualifying country, except metallurgical processes involving refinement of steel additives). The cost of iron and steel not produced in the United States or a qualifying country includes but is not limited to the cost of iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings, not produced in the United States or a qualifying country, utilized in the manufacture of the end product and a good faith estimate of the cost of all iron or steel components not produced in the United States or a qualifying country, excluding COTS fasteners. Iron or steel components of unknown origin are treated as foreign. If the end product contains multiple components, the cost of all the materials used in such end product is calculated in accordance with the explanation of cost of components in paragraph (1)(ii)(A) of this definition.</P>
                                <P>
                                    <E T="03">End product</E>
                                     means those articles, materials, and supplies to be acquired under this contract for public use.
                                </P>
                                <P>
                                    <E T="03">Foreign end product</E>
                                     means an end product other than a domestic end product.
                                </P>
                                <P>
                                    <E T="03">Free Trade Agreement country</E>
                                     means Australia, Bahrain, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua, Panama, Peru, or Singapore.
                                </P>
                                <P>
                                    <E T="03">Free Trade Agreement country end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a Free Trade Agreement country; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in a Free Trade Agreement country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Moroccan end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Morocco; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Morocco into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Panamanian end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Panama; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Panama into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Peruvian end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Peru; or</P>
                                <P>
                                    (2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Peru into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under 
                                    <PRTPAGE P="551"/>
                                    a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.
                                </P>
                                <P>
                                    <E T="03">Predominantly of iron or steel or a combination of both</E>
                                     means that the cost of the iron and steel content exceeds 50 percent of the total cost of all its components. The cost of iron and steel is the cost of the iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings utilized in the manufacture of the product and a good faith estimate of the cost of iron or steel components excluding COTS fasteners.
                                </P>
                                <P>
                                    <E T="03">Qualifying country</E>
                                     means a country with a reciprocal defense procurement memorandum of understanding or international agreement with the United States in which both countries agree to remove barriers to purchases of supplies produced in the other country or services performed by sources of the other country, and the memorandum or agreement complies, where applicable, with the requirements of section 36 of the Arms Export Control Act (22 U.S.C. 2776) and with 10 U.S.C. 2457. Accordingly, the following are qualifying countries:
                                </P>
                                <FP SOURCE="FP-1">Australia</FP>
                                <FP SOURCE="FP-1">Austria</FP>
                                <FP SOURCE="FP-1">Belgium</FP>
                                <FP SOURCE="FP-1">Canada</FP>
                                <FP SOURCE="FP-1">Czech Republic</FP>
                                <FP SOURCE="FP-1">Denmark</FP>
                                <FP SOURCE="FP-1">Egypt</FP>
                                <FP SOURCE="FP-1">Estonia</FP>
                                <FP SOURCE="FP-1">Finland</FP>
                                <FP SOURCE="FP-1">France</FP>
                                <FP SOURCE="FP-1">Germany</FP>
                                <FP SOURCE="FP-1">Greece</FP>
                                <FP SOURCE="FP-1">Israel</FP>
                                <FP SOURCE="FP-1">Italy</FP>
                                <FP SOURCE="FP-1">Japan</FP>
                                <FP SOURCE="FP-1">Latvia</FP>
                                <FP SOURCE="FP-1">Lithuania</FP>
                                <FP SOURCE="FP-1">Luxembourg</FP>
                                <FP SOURCE="FP-1">Netherlands</FP>
                                <FP SOURCE="FP-1">Norway</FP>
                                <FP SOURCE="FP-1">Poland</FP>
                                <FP SOURCE="FP-1">Portugal</FP>
                                <FP SOURCE="FP-1">Slovenia</FP>
                                <FP SOURCE="FP-1">Spain</FP>
                                <FP SOURCE="FP-1">Sweden</FP>
                                <FP SOURCE="FP-1">Switzerland</FP>
                                <FP SOURCE="FP-1">Turkey</FP>
                                <FP SOURCE="FP-1">United Kingdom of Great Britain and Northern Ireland.</FP>
                                <P>
                                    <E T="03">Qualifying country component</E>
                                     means a component mined, produced, or manufactured in a qualifying country.
                                </P>
                                <P>
                                    <E T="03">Qualifying country end product</E>
                                     means—
                                </P>
                                <P>(1) An unmanufactured end product mined or produced in a qualifying country; or</P>
                                <P>(2) An end product manufactured in a qualifying country if—</P>
                                <P>(i) The cost of the following types of components exceeds 60 percent of the cost of all its components, except that the percentage will be 65 percent for items delivered in calendar years 2024 through 2028 and 75 percent for items delivered starting in calendar year 2029, unless an alternate percentage is established for a contract:</P>
                                <P>(A) Components mined, produced, or manufactured in a qualifying country.</P>
                                <P>(B) Components mined, produced, or manufactured in the United States.</P>
                                <P>(C) Components of foreign origin of a class or kind for which the Government has determined that sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States. Components of unknown origin are treated as foreign; or</P>
                                <P>(ii) The end product is a COTS item.</P>
                                <P>
                                    <E T="03">Steel</E>
                                     means an alloy that includes at least 50 percent iron, between 0.02 and 2 percent carbon, and may include other elements.
                                </P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>(b) Unless otherwise specified, this clause applies to all items in the Schedule.</P>
                                <P>(c) The Contractor shall deliver under this contract only domestic end products unless, in its offer, it specified delivery of qualifying country end products, Free Trade Agreement country end products other than Bahraini end products, Moroccan end products, Panamanian end products, or Peruvian end products, or other foreign end products in the Buy American—Free Trade Agreements—Balance of Payments Program Certificate—Basic provision of the solicitation. If the Contractor certified in its offer that it will deliver a qualifying country end product or a Free Trade Agreement country end product other than a Bahraini end product, a Moroccan end product, a Panamanian end product, or a Peruvian end product, the Contractor shall deliver a qualifying country end product, a Free Trade Agreement country end product other than a Bahraini end product, a Moroccan end product, a Panamanian end product, or a Peruvian end product, or, at the Contractor's option, a domestic end product.</P>
                                <P>(d) The contract price does not include duty for end products or components for which the Contractor will claim duty-free entry.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate I.</E>
                                 As prescribed in 225.1101(10)(i) and (10)(i)(B), use the following clause, which uses a different paragraph (c) than the basic clause:
                            </P>
                            <EXTRACT>
                                <PRTPAGE P="552"/>
                                <HD SOURCE="HD1">Buy American—Free Trade Agreements—Balance of Payments Program—Alternate I (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Bahraini end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Bahrain; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Bahrain into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Commercially available off-the-shelf (COTS) item</E>
                                    —
                                </P>
                                <P>(1) Means any item of supply (including construction material) that is—</P>
                                <P>
                                    (i) A commercial product (as defined in paragraph (1) of the definition of 
                                    <E T="03">commercial product</E>
                                     in section 2.101 of the Federal Acquisition Regulation (FAR));
                                </P>
                                <P>(ii) Sold in substantial quantities in the commercial marketplace; and</P>
                                <P>(iii) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and</P>
                                <P>(2) Does not include bulk cargo, as defined in 46 U.S.C. 40102(4), such as agricultural products and petroleum products.</P>
                                <P>
                                    <E T="03">Component</E>
                                     means an article, material, or supply incorporated directly into an end product.
                                </P>
                                <P>
                                    <E T="03">Critical component</E>
                                     means a component that is mined, produced, or manufactured in the United States and deemed critical to the U.S. supply chain. The list of critical components is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Critical item</E>
                                     means domestic construction material or a domestic end product that is deemed critical to the U.S. supply chain. The list of critical items is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Domestic end product</E>
                                     means—
                                </P>
                                <P>(1) For an end product that does not consist wholly or predominantly of iron or steel or a combination of both—</P>
                                <P>(i) An unmanufactured end product mined or produced in the United States; or</P>
                                <P>(ii) An end product manufactured in the United States if—</P>
                                <P>(A) The cost of its qualifying country components and its components that are mined, produced, or manufactured in the United States exceeds 60 percent of the cost of all its components, except that the percentage will be 65 percent for items delivered in calendar years 2024 through 2028 and 75 percent for items delivered starting in calendar year 2029, unless an alternate percentage is established for a contract in accordance with Defense Federal Acquisition Regulation Supplement (DFARS) 225.101(d); or award is made before January 1, 2030, for a foreign end product that exceeds 55 percent domestic content (see DFARS 225.103(b)(ii)). The cost of components includes transportation costs to the place of incorporation into the end product and U.S. duty (whether or not a duty-free entry certificate is issued). Components of unknown origin are treated as foreign. Scrap generated, collected, and prepared for processing in the United States is considered domestic. A component is considered to have been mined, produced, or manufactured in the United States (regardless of its source in fact) if the end product in which it is incorporated is manufactured in the United States and the component is of a class or kind for which the Government has determined that—</P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) Sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States; or
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) It is inconsistent with the public interest to apply the restrictions of the Buy American statute; or
                                </P>
                                <P>(B) The end product is a COTS item; or</P>
                                <P>(2) For an end product that consists wholly or predominantly of iron or steel or a combination of both, an end product manufactured in the United States, if the cost of iron and steel not produced in the United States or a qualifying country constitutes less than 5 percent of the cost of all the components used in the end product (produced in the United States or a qualifying country means that all manufacturing processes of the iron or steel must take place in the United States or a qualifying country, except metallurgical processes involving refinement of steel additives). The cost of iron and steel not produced in the United States or a qualifying country includes but is not limited to the cost of iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings, not produced in the United States or a qualifying country, utilized in the manufacture of the end product and a good faith estimate of the cost of all iron or steel components not produced in the United States or a qualifying country, excluding COTS fasteners. Iron or steel components of unknown origin are treated as foreign. If the end product contains multiple components, the cost of all the materials used in such end product is calculated in accordance with the explanation of cost of components in paragraph (1)(ii)(A) of this definition.</P>
                                <P>
                                    <E T="03">End product</E>
                                     means those articles, materials, and supplies to be acquired under this contract for public use.
                                </P>
                                <P>
                                    <E T="03">Foreign end product</E>
                                     means an end product other than a domestic end product.
                                    <PRTPAGE P="553"/>
                                </P>
                                <P>
                                    <E T="03">Free Trade Agreement country</E>
                                     means Australia, Bahrain, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua, Panama, Peru, or Singapore.
                                </P>
                                <P>
                                    <E T="03">Free Trade Agreement country end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a Free Trade Agreement country; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in a Free Trade Agreement country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Moroccan end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Morocco; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Morocco into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Panamanian end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Panama; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Panama into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Peruvian end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Peru; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Peru into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Predominantly of iron or steel or a combination of both</E>
                                     means that the cost of the iron and steel content exceeds 50 percent of the total cost of all its components. The cost of iron and steel is the cost of the iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings utilized in the manufacture of the product and a good faith estimate of the cost of iron or steel components excluding COTS fasteners.
                                </P>
                                <P>
                                    <E T="03">Qualifying country</E>
                                     means a country with a reciprocal defense procurement memorandum of understanding or international agreement with the United States in which both countries agree to remove barriers to purchases of supplies produced in the other country or services performed by sources of the other country, and the memorandum or agreement complies, where applicable, with the requirements of section 36 of the Arms Export Control Act (22 U.S.C. 2776) and with 10 U.S.C. 2457. Accordingly, the following are qualifying countries:
                                </P>
                                <FP SOURCE="FP-1">Australia</FP>
                                <FP SOURCE="FP-1">Austria</FP>
                                <FP SOURCE="FP-1">Belgium</FP>
                                <FP SOURCE="FP-1">Canada</FP>
                                <FP SOURCE="FP-1">Czech Republic</FP>
                                <FP SOURCE="FP-1">Denmark</FP>
                                <FP SOURCE="FP-1">Egypt</FP>
                                <FP SOURCE="FP-1">Estonia</FP>
                                <FP SOURCE="FP-1">Finland</FP>
                                <FP SOURCE="FP-1">France</FP>
                                <FP SOURCE="FP-1">Germany</FP>
                                <FP SOURCE="FP-1">Greece</FP>
                                <FP SOURCE="FP-1">Israel</FP>
                                <FP SOURCE="FP-1">Italy</FP>
                                <FP SOURCE="FP-1">Japan</FP>
                                <FP SOURCE="FP-1">Latvia</FP>
                                <FP SOURCE="FP-1">Lithuania</FP>
                                <FP SOURCE="FP-1">Luxembourg</FP>
                                <FP SOURCE="FP-1">Netherlands</FP>
                                <FP SOURCE="FP-1">Norway</FP>
                                <FP SOURCE="FP-1">Poland</FP>
                                <FP SOURCE="FP-1">Portugal</FP>
                                <FP SOURCE="FP-1">Slovenia</FP>
                                <FP SOURCE="FP-1">Spain</FP>
                                <FP SOURCE="FP-1">Sweden</FP>
                                <FP SOURCE="FP-1">Switzerland</FP>
                                <FP SOURCE="FP-1">Turkey</FP>
                                <FP SOURCE="FP-1">United Kingdom of Great Britain and Northern Ireland.</FP>
                                <PRTPAGE P="554"/>
                                <P>
                                    <E T="03">Qualifying country component</E>
                                     means a component mined, produced, or manufactured in a qualifying country.
                                </P>
                                <P>
                                    <E T="03">Qualifying country end product</E>
                                     means—
                                </P>
                                <P>(1) An unmanufactured end product mined or produced in a qualifying country; or</P>
                                <P>(2) An end product manufactured in a qualifying country if—</P>
                                <P>(i) The cost of the following types of components exceeds 60 percent of the cost of all its components, except that the percentage will be 65 percent for items delivered in calendar years 2024 through 2028 and 75 percent for items delivered starting in calendar year 2029, unless an alternate percentage is established for a contract:</P>
                                <P>(A) Components mined, produced, or manufactured in a qualifying country.</P>
                                <P>(B) Components mined, produced, or manufactured in the United States.</P>
                                <P>(C) Components of foreign origin of a class or kind for which the Government has determined that sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States. Components of unknown origin are treated as foreign; or</P>
                                <P>(ii) The end product is a COTS item.</P>
                                <P>
                                    <E T="03">Steel</E>
                                     means an alloy that includes at least 50 percent iron, between 0.02 and 2 percent carbon, and may include other elements.
                                </P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>(b) Unless otherwise specified, this clause applies to all items in the Schedule.</P>
                                <P>(c) The Contractor shall deliver under this contract only domestic end products unless, in its offer, it specified delivery of qualifying country, or other foreign end products in the Buy American—Free Trade Agreements—Balance of Payments Program Certificate—Alternate I provision of the solicitation. If the Contractor certified in its offer that it will deliver a qualifying country end product, the Contractor shall deliver a qualifying country end product or, at the Contractor's option, a domestic end product.</P>
                                <P>(d) The contract price does not include duty for end products or components for which the Contractor will claim duty-free entry.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate II.</E>
                                 As prescribed in 225.1101(10)(i) and (10)(i)(C), use the following clause, which adds South Caucasus/Central and South Asian (SC/CASA) state and South Caucasus/Central and South Asian (SC/CASA) state end product to paragraph (a), and uses a different paragraph (c) than the basic clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Buy American—Free Trade Agreements—Balance of Payments Program—Alternate II (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Bahraini end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Bahrain; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Bahrain into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Commercially available off-the-shelf (COTS) item</E>
                                    —
                                </P>
                                <P>(1) Means any item of supply (including construction material) that is—</P>
                                <P>
                                    (i) A commercial product (as defined in paragraph (1) of the definition of 
                                    <E T="03">commercial product</E>
                                     in section 2.101 of the Federal Acquisition Regulation (FAR));
                                </P>
                                <P>(ii) Sold in substantial quantities in the commercial marketplace; and</P>
                                <P>(iii) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and</P>
                                <P>(2) Does not include bulk cargo, as defined in 46 U.S.C. 40102(4), such as agricultural products and petroleum products.</P>
                                <P>
                                    <E T="03">Component</E>
                                     means an article, material, or supply incorporated directly into an end product.
                                </P>
                                <P>
                                    <E T="03">Critical component</E>
                                     means a component that is mined, produced, or manufactured in the United States and deemed critical to the U.S. supply chain. The list of critical components is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Critical item</E>
                                     means domestic construction material or a domestic end product that is deemed critical to the U.S. supply chain. The list of critical items is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Domestic end product</E>
                                     means—
                                </P>
                                <P>(1) For an end product that does not consist wholly or predominantly of iron or steel or a combination of both—</P>
                                <P>(i) An unmanufactured end product mined or produced in the United States; or</P>
                                <P>(ii) An end product manufactured in the United States if—</P>
                                <P>
                                    (A) The cost of its qualifying country components and its components that are mined, produced, or manufactured in the United States exceeds 60 percent of the cost of all its components, except that the percentage will be 65 percent for items delivered in calendar years 2024 through 2028 and 75 percent 
                                    <PRTPAGE P="555"/>
                                    for items delivered starting in calendar year 2029, unless an alternate percentage is established for a contract in accordance with Defense Federal Acquisition Regulation Supplement (DFARS) 225.101(d); or award is made before January 1, 2030, for a foreign end product that exceeds 55 percent domestic content (see DFARS 225.103(b)(ii)). The cost of components includes transportation costs to the place of incorporation into the end product and U.S. duty (whether or not a duty-free entry certificate is issued). Components of unknown origin are treated as foreign. Scrap generated, collected, and prepared for processing in the United States is considered domestic. A component is considered to have been mined, produced, or manufactured in the United States (regardless of its source in fact) if the end product in which it is incorporated is manufactured in the United States and the component is of a class or kind for which the Government has determined that—
                                </P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) Sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States; or
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) It is inconsistent with the public interest to apply the restrictions of the Buy American statute; or
                                </P>
                                <P>(B) The end product is a COTS item; or</P>
                                <P>(2) For an end product that consists wholly or predominantly of iron or steel or a combination of both, an end product manufactured in the United States, if the cost of iron and steel not produced in the United States or a qualifying country constitutes less than 5 percent of the cost of all the components used in the end product (produced in the United States or a qualifying country means that all manufacturing processes of the iron or steel must take place in the United States or a qualifying country, except metallurgical processes involving refinement of steel additives). The cost of iron and steel not produced in the United States or a qualifying country includes but is not limited to the cost of iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings, not produced in the United States or a qualifying country, utilized in the manufacture of the end product and a good faith estimate of the cost of all iron or steel components not produced in the United States or a qualifying country, excluding COTS fasteners. Iron or steel components of unknown origin are treated as foreign. If the end product contains multiple components, the cost of all the materials used in such end product is calculated in accordance with the explanation of cost of components in paragraph (1)(ii)(A) of this definition.</P>
                                <P>
                                    <E T="03">End product</E>
                                     means those articles, materials, and supplies to be acquired under this contract for public use.
                                </P>
                                <P>
                                    <E T="03">Foreign end product</E>
                                     means an end product other than a domestic end product.
                                </P>
                                <P>
                                    <E T="03">Free Trade Agreement country</E>
                                     means Australia, Bahrain, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua, Panama, Peru, or Singapore.
                                </P>
                                <P>
                                    <E T="03">Free Trade Agreement country end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a Free Trade Agreement country; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in a Free Trade Agreement country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Moroccan end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Morocco; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Morocco into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Panamanian end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Panama; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Panama into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Peruvian end product</E>
                                     means an article that—
                                </P>
                                <P>
                                    (1) Is wholly the growth, product, or manufacture of Peru; or
                                    <PRTPAGE P="556"/>
                                </P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Peru into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Predominantly of iron or steel or a combination of both</E>
                                     means that the cost of the iron and steel content exceeds 50 percent of the total cost of all its components. The cost of iron and steel is the cost of the iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings utilized in the manufacture of the product and a good faith estimate of the cost of iron or steel components excluding COTS fasteners.
                                </P>
                                <P>
                                    <E T="03">Qualifying country</E>
                                     means a country with a reciprocal defense procurement memorandum of understanding or international agreement with the United States in which both countries agree to remove barriers to purchases of supplies produced in the other country or services performed by sources of the other country, and the memorandum or agreement complies, where applicable, with the requirements of section 36 of the Arms Export Control Act (22 U.S.C. 2776) and with 10 U.S.C. 2457. Accordingly, the following are qualifying countries:
                                </P>
                                <FP SOURCE="FP-1">Australia</FP>
                                <FP SOURCE="FP-1">Austria</FP>
                                <FP SOURCE="FP-1">Belgium</FP>
                                <FP SOURCE="FP-1">Canada</FP>
                                <FP SOURCE="FP-1">Czech Republic</FP>
                                <FP SOURCE="FP-1">Denmark</FP>
                                <FP SOURCE="FP-1">Egypt</FP>
                                <FP SOURCE="FP-1">Estonia</FP>
                                <FP SOURCE="FP-1">Finland</FP>
                                <FP SOURCE="FP-1">France</FP>
                                <FP SOURCE="FP-1">Germany</FP>
                                <FP SOURCE="FP-1">Greece</FP>
                                <FP SOURCE="FP-1">Israel</FP>
                                <FP SOURCE="FP-1">Italy</FP>
                                <FP SOURCE="FP-1">Japan</FP>
                                <FP SOURCE="FP-1">Latvia</FP>
                                <FP SOURCE="FP-1">Lithuania</FP>
                                <FP SOURCE="FP-1">Luxembourg</FP>
                                <FP SOURCE="FP-1">Netherlands</FP>
                                <FP SOURCE="FP-1">Norway</FP>
                                <FP SOURCE="FP-1">Poland</FP>
                                <FP SOURCE="FP-1">Portugal</FP>
                                <FP SOURCE="FP-1">Slovenia</FP>
                                <FP SOURCE="FP-1">Spain</FP>
                                <FP SOURCE="FP-1">Sweden</FP>
                                <FP SOURCE="FP-1">Switzerland</FP>
                                <FP SOURCE="FP-1">Turkey</FP>
                                <FP SOURCE="FP-1">United Kingdom of Great Britain and Northern Ireland.</FP>
                                <P>
                                    <E T="03">Qualifying country component</E>
                                     means a component mined, produced, or manufactured in a qualifying country.
                                </P>
                                <P>
                                    <E T="03">Qualifying country end product</E>
                                     means—
                                </P>
                                <P>(1) An unmanufactured end product mined or produced in a qualifying country; or</P>
                                <P>(2) An end product manufactured in a qualifying country if—</P>
                                <P>(i) The cost of the following types of components exceeds 60 percent of the cost of all its components, except that the percentage will be 65 percent for items delivered in calendar years 2024 through 2028 and 75 percent for items delivered starting in calendar year 2029, unless an alternate percentage is established for a contract:</P>
                                <P>(A) Components mined, produced, or manufactured in a qualifying country.</P>
                                <P>(B) Components mined, produced, or manufactured in the United States.</P>
                                <P>(C) Components of foreign origin of a class or kind for which the Government has determined that sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States. Components of unknown origin are treated as foreign; or</P>
                                <P>(ii) The end product is a COTS item.</P>
                                <P>
                                    <E T="03">South Caucasus/Central and South Asian (SC/CASA) state</E>
                                     means Armenia, Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, Pakistan, Tajikistan, Turkmenistan, or Uzbekistan.
                                </P>
                                <P>
                                    <E T="03">South Caucasus/Central and South Asian (SC/CASA) state end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of an SC/CASA state; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in an SC/CASA state into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Steel</E>
                                     means an alloy that includes at least 50 percent iron, between 0.02 and 2 percent carbon, and may include other elements.
                                </P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>(b) Unless otherwise specified, this clause applies to all items in the Schedule.</P>
                                <P>
                                    (c) The Contractor shall deliver under this contract only domestic end products unless, in its offer, it specified delivery of qualifying country end products, SC/CASA state end products, Free Trade Agreement country end products other than Bahraini end products, Moroccan end products, Panamanian end products, or Peruvian end products, or other foreign end products in the Buy American—
                                    <PRTPAGE P="557"/>
                                    Free Trade Agreements—Balance of Payments Program Certificate—Alternate II provision of the solicitation. If the Contractor certified in its offer that it will deliver a qualifying country end product, SC/CASA state end products, or a Free Trade Agreement country end product other than a Bahraini end product, a Moroccan end product, a Panamanian end product, or a Peruvian end product, the Contractor shall deliver a qualifying country end product, an SC/CASA state end product, a Free Trade Agreement country end product other than a Bahraini end product, a Moroccan end product, a Panamanian end product, or a Peruvian end product or, at the Contractor's option, a domestic end product.
                                </P>
                                <P>(d) The contract price does not include duty for end products or components for which the Contractor will claim duty-free entry.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate III.</E>
                                 As prescribed in 225.1101(10)(i) and (10)(i)(D), use the following clause, which adds 
                                <E T="03">South Caucasus/Central and South Asian (SC/CASA) state</E>
                                 and 
                                <E T="03">South Caucasus/Central and South Asian (SC/CASA) state end product</E>
                                 to paragraph (a) and uses a different paragraph (c) than the basic clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Buy American—Free Trade Agreements—Balance Of Payments Program—Alternate III (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Bahraini end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Bahrain; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Bahrain into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Commercially available off-the-shelf (COTS) item</E>
                                    —
                                </P>
                                <P>(1) Means any item of supply (including construction material) that is—</P>
                                <P>
                                    (i) A commercial product (as defined in paragraph (1) of the definition of 
                                    <E T="03">commercial product</E>
                                     in section 2.101 of the Federal Acquisition Regulation (FAR));
                                </P>
                                <P>(ii) Sold in substantial quantities in the commercial marketplace; and</P>
                                <P>(iii) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and</P>
                                <P>(2) Does not include bulk cargo, as defined in 46 U.S.C. 40102(4), such as agricultural products and petroleum products.</P>
                                <P>
                                    <E T="03">Component</E>
                                     means an article, material, or supply incorporated directly into an end product.
                                </P>
                                <P>
                                    <E T="03">Critical component</E>
                                     means a component that is mined, produced, or manufactured in the United States and deemed critical to the U.S. supply chain. The list of critical components is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Critical item</E>
                                     means domestic construction material or a domestic end product that is deemed critical to the U.S. supply chain. The list of critical items is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Domestic end product</E>
                                     means—
                                </P>
                                <P>(1) For an end product that does not consist wholly or predominantly of iron or steel or a combination of both—</P>
                                <P>(i) An unmanufactured end product mined or produced in the United States; or</P>
                                <P>(ii) An end product manufactured in the United States if—</P>
                                <P>(A) The cost of its qualifying country components and its components that are mined, produced, or manufactured in the United States exceeds 60 percent of the cost of all its components, except that the percentage will be 65 percent for items delivered in calendar years 2024 through 2028 and 75 percent for items delivered starting in calendar year 2029, unless an alternate percentage is established for a contract in accordance with Defense Federal Acquisition Regulation Supplement (DFARS) 225.101(d); or award is made before January 1, 2030, for a foreign end product that exceeds 55 percent domestic content (see DFARS 225.103(b)(ii)). The cost of components includes transportation costs to the place of incorporation into the end product and U.S. duty (whether or not a duty-free entry certificate is issued). Components of unknown origin are treated as foreign. Scrap generated, collected, and prepared for processing in the United States is considered domestic. A component is considered to have been mined, produced, or manufactured in the United States (regardless of its source in fact) if the end product in which it is incorporated is manufactured in the United States and the component is of a class or kind for which the Government has determined that—</P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) Sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States; or
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) It is inconsistent with the public interest to apply the restrictions of the Buy American statute; or
                                </P>
                                <P>
                                    (B) The end product is a COTS item; or
                                    <PRTPAGE P="558"/>
                                </P>
                                <P>(2) For an end product that consists wholly or predominantly of iron or steel or a combination of both, an end product manufactured in the United States, if the cost of iron and steel not produced in the United States or a qualifying country constitutes less than 5 percent of the cost of all the components used in the end product (produced in the United States or a qualifying country means that all manufacturing processes of the iron and steel must take place in the United States or a qualifying country, except metallurgical processes involving refinement of steel additives). The cost of iron and steel not produced in the United States or a qualifying country includes but is not limited to the cost of iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings, not produced in the United States or a qualifying country, utilized in the manufacture of the end product and a good faith estimate of the cost of all iron or steel components not produced in the United States or a qualifying country, excluding COTS fasteners. Iron or steel components of unknown origin are treated as foreign. If the end product contains multiple components, the cost of all the materials used in such end product is calculated in accordance with the explanation of cost of components in paragraph (1)(ii)(A) of this definition.</P>
                                <P>
                                    <E T="03">End product</E>
                                     means those articles, materials, and supplies to be acquired under this contract for public use.
                                </P>
                                <P>
                                    <E T="03">Foreign end product</E>
                                     means an end product other than a domestic end product.
                                </P>
                                <P>
                                    <E T="03">Free Trade Agreement country</E>
                                     means Australia, Bahrain, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua, Panama, Peru, or Singapore.
                                </P>
                                <P>
                                    <E T="03">Free Trade Agreement country end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a Free Trade Agreement country; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in a Free Trade Agreement country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Moroccan end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Morocco; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Morocco into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Panamanian end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Panama; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Panama into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Peruvian end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Peru; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Peru into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Predominantly of iron or steel or a combination of both</E>
                                     means that the cost of the iron and steel content exceeds 50 percent of the total cost of all its components. The cost of iron and steel is the cost of the iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings utilized in the manufacture of the product and a good faith estimate of the cost of iron or steel components excluding COTS fasteners.
                                </P>
                                <P>
                                    <E T="03">Qualifying country</E>
                                     means a country with a reciprocal defense procurement memorandum of understanding or international agreement with the United States in which both countries agree to remove barriers to purchases of supplies produced in the other country or services performed by sources of 
                                    <PRTPAGE P="559"/>
                                    the other country, and the memorandum or agreement complies, where applicable, with the requirements of section 36 of the Arms Export Control Act (22 U.S.C. 2776) and with 10 U.S.C. 2457. Accordingly, the following are qualifying countries:
                                </P>
                                <FP SOURCE="FP-1">Australia</FP>
                                <FP SOURCE="FP-1">Austria</FP>
                                <FP SOURCE="FP-1">Belgium</FP>
                                <FP SOURCE="FP-1">Canada</FP>
                                <FP SOURCE="FP-1">Czech Republic</FP>
                                <FP SOURCE="FP-1">Denmark</FP>
                                <FP SOURCE="FP-1">Egypt</FP>
                                <FP SOURCE="FP-1">Estonia</FP>
                                <FP SOURCE="FP-1">Finland</FP>
                                <FP SOURCE="FP-1">France</FP>
                                <FP SOURCE="FP-1">Germany</FP>
                                <FP SOURCE="FP-1">Greece</FP>
                                <FP SOURCE="FP-1">Israel</FP>
                                <FP SOURCE="FP-1">Italy</FP>
                                <FP SOURCE="FP-1">Japan</FP>
                                <FP SOURCE="FP-1">Latvia</FP>
                                <FP SOURCE="FP-1">Lithuania</FP>
                                <FP SOURCE="FP-1">Luxembourg</FP>
                                <FP SOURCE="FP-1">Netherlands</FP>
                                <FP SOURCE="FP-1">Norway</FP>
                                <FP SOURCE="FP-1">Poland</FP>
                                <FP SOURCE="FP-1">Portugal</FP>
                                <FP SOURCE="FP-1">Slovenia</FP>
                                <FP SOURCE="FP-1">Spain</FP>
                                <FP SOURCE="FP-1">Sweden</FP>
                                <FP SOURCE="FP-1">Switzerland</FP>
                                <FP SOURCE="FP-1">Turkey</FP>
                                <FP SOURCE="FP-1">United Kingdom of Great Britain and Northern Ireland.</FP>
                                <P>
                                    <E T="03">Qualifying country component</E>
                                     means a component mined, produced, or manufactured in a qualifying country.
                                </P>
                                <P>
                                    <E T="03">Qualifying country end product</E>
                                     means—
                                </P>
                                <P>(1) An unmanufactured end product mined or produced in a qualifying country; or</P>
                                <P>(2) An end product manufactured in a qualifying country if—</P>
                                <P>(i) The cost of the following types of components exceeds 60 percent of the cost of all its components, except that the percentage will be 65 percent for items delivered in calendar years 2024 through 2028 and 75 percent for items delivered starting in calendar year 2029, unless an alternate percentage is established for a contract:</P>
                                <P>(A) Components mined, produced, or manufactured in a qualifying country.</P>
                                <P>(B) Components mined, produced, or manufactured in the United States.</P>
                                <P>(C) Components of foreign origin of a class or kind for which the Government has determined that sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States. Components of unknown origin are treated as foreign; or</P>
                                <P>(ii) The end product is a COTS item.</P>
                                <P>
                                    <E T="03">South Caucasus/Central and South Asian (SC/CASA) state</E>
                                     means Armenia, Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, Pakistan, Tajikistan, Turkmenistan, or Uzbekistan.
                                </P>
                                <P>
                                    <E T="03">South Caucasus/Central and South Asian (SC/CASA) state end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of an SC/CASA state; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in an SC/CASA state into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Steel</E>
                                     means an alloy that includes at least 50 percent iron, between 0.02 and 2 percent carbon, and may include other elements.
                                </P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>(b) Unless otherwise specified, this clause applies to all items in the Schedule.</P>
                                <P>(c) The Contractor shall deliver under this contract only domestic end products unless, in its offer, it specified delivery of qualifying country end products, SC/CASA state end products, or other foreign end products in the Buy American—Free Trade Agreements—Balance of Payments Program Certificate—Alternate III provision of the solicitation. If the Contractor certified in its offer that it will deliver a qualifying country end product or SC/CASA state end products, the Contractor shall deliver a qualifying country end product, an SC/CASA state end product, or, at the Contractor's option, a domestic end product.</P>
                                <P>(d) The contract price does not include duty for end products or components for which the Contractor will claim duty-free entry.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate IV.</E>
                                 As prescribed in 225.1101(10)(i) and (10)(i)(E), use the following clause, which adds 
                                <E T="03">Korean end product</E>
                                 to paragraph (a), and uses a different paragraph (c) than the basic clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Buy American—Free Trade Agreements—Balance of Payments Program—Alternate IV (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Bahraini end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Bahrain; or</P>
                                <P>
                                    (2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed 
                                    <PRTPAGE P="560"/>
                                    in Bahrain into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.
                                </P>
                                <P>
                                    <E T="03">Commercially available off-the-shelf (COTS) item</E>
                                    —
                                </P>
                                <P>(1) Means any item of supply (including construction material) that is—</P>
                                <P>
                                    (i) A commercial product (as defined in paragraph (1) of the definition of 
                                    <E T="03">commercial product</E>
                                     in section 2.101 of the Federal Acquisition Regulation (FAR));
                                </P>
                                <P>(ii) Sold in substantial quantities in the commercial marketplace; and</P>
                                <P>(iii) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and</P>
                                <P>(2) Does not include bulk cargo, as defined in 46 U.S.C. 40102(4), such as agricultural products and petroleum products.</P>
                                <P>
                                    <E T="03">Component</E>
                                     means an article, material, or supply incorporated directly into an end product.
                                </P>
                                <P>
                                    <E T="03">Critical component</E>
                                     means a component that is mined, produced, or manufactured in the United States and deemed critical to the U.S. supply chain. The list of critical components is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Critical item</E>
                                     means domestic construction material or a domestic end product that is deemed critical to the U.S. supply chain. The list of critical items is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Domestic end product</E>
                                     means—
                                </P>
                                <P>(1) For an end product that does not consist wholly or predominantly of iron or steel or a combination of both—</P>
                                <P>(i) An unmanufactured end product mined or produced in the United States; or</P>
                                <P>(ii) An end product manufactured in the United States if—</P>
                                <P>(A) The cost of its qualifying country components and its components that are mined, produced, or manufactured in the United States exceeds 60 percent of the cost of all its components, except that the percentage will be 65 percent for items delivered in calendar years 2024 through 2028 and 75 percent for items delivered starting in calendar year 2029, unless an alternate percentage is established for a contract in accordance with Defense Federal Acquisition Regulation Supplement (DFARS) 225.101(d); or award is made before January 1, 2030, for a foreign end product that exceeds 55 percent domestic content (see DFARS 225.103(b)(ii)). The cost of components includes transportation costs to the place of incorporation into the end product and U.S. duty (whether or not a duty-free entry certificate is issued). Components of unknown origin are treated as foreign. Scrap generated, collected, and prepared for processing in the United States is considered domestic. A component is considered to have been mined, produced, or manufactured in the United States (regardless of its source in fact) if the end product in which it is incorporated is manufactured in the United States and the component is of a class or kind for which the Government has determined that—</P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) Sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States; or
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) It is inconsistent with the public interest to apply the restrictions of the Buy American statute; or
                                </P>
                                <P>(B) The end product is a COTS item; or</P>
                                <P>(2) For an end product that consists wholly or predominantly of iron or steel or a combination of both, an end product manufactured in the United States, if the cost of iron and steel not produced in the United States or a qualifying country constitutes less than 5 percent of the cost of all the components used in the end product (produced in the United States or a qualifying country means that all manufacturing processes of the iron or steel must take place in the United States or a qualifying country, except metallurgical processes involving refinement of steel additives). The cost of iron and steel not produced in the United States or a qualifying country includes but is not limited to the cost of iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings, not produced in the United States or a qualifying country, utilized in the manufacture of the end product and a good faith estimate of the cost of all iron or steel components not produced in the United States or a qualifying country, excluding COTS fasteners. Iron or steel components of unknown origin are treated as foreign. If the end product contains multiple components, the cost of all the materials used in such end product is calculated in accordance with the explanation of cost of components in paragraph (1)(ii)(A) of this definition.</P>
                                <P>
                                    <E T="03">End product</E>
                                     means those articles, materials, and supplies to be acquired under this contract for public use.
                                </P>
                                <P>
                                    <E T="03">Foreign end product</E>
                                     means an end product other than a domestic end product.
                                </P>
                                <P>
                                    <E T="03">Free Trade Agreement country</E>
                                     means Australia, Bahrain, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua, Panama, Peru, or Singapore.
                                </P>
                                <P>
                                    <E T="03">Free Trade Agreement country end product</E>
                                     means an article that—
                                </P>
                                <P>
                                    (1) Is wholly the growth, product, or manufacture of a Free Trade Agreement country; or
                                    <PRTPAGE P="561"/>
                                </P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in a Free Trade Agreement country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Korean end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Korea; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Korea (Republic of) into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product, includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Moroccan end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Morocco; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Morocco into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Panamanian end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Panama; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Panama into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Peruvian end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Peru; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Peru into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Predominantly of iron or steel or a combination of both</E>
                                     means that the cost of the iron and steel content exceeds 50 percent of the total cost of all its components. The cost of iron and steel is the cost of the iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings utilized in the manufacture of the product and a good faith estimate of the cost of iron or steel components excluding COTS fasteners.
                                </P>
                                <P>
                                    <E T="03">Qualifying country</E>
                                     means a country with a reciprocal defense procurement memorandum of understanding or international agreement with the United States in which both countries agree to remove barriers to purchases of supplies produced in the other country or services performed by sources of the other country, and the memorandum or agreement complies, where applicable, with the requirements of section 36 of the Arms Export Control Act (22 U.S.C. 2776) and with 10 U.S.C. 2457. Accordingly, the following are qualifying countries:
                                </P>
                                <FP SOURCE="FP-1">Australia</FP>
                                <FP SOURCE="FP-1">Austria</FP>
                                <FP SOURCE="FP-1">Belgium</FP>
                                <FP SOURCE="FP-1">Canada</FP>
                                <FP SOURCE="FP-1">Czech Republic</FP>
                                <FP SOURCE="FP-1">Denmark</FP>
                                <FP SOURCE="FP-1">Egypt</FP>
                                <FP SOURCE="FP-1">Estonia</FP>
                                <FP SOURCE="FP-1">Finland</FP>
                                <FP SOURCE="FP-1">France</FP>
                                <FP SOURCE="FP-1">Germany</FP>
                                <FP SOURCE="FP-1">Greece</FP>
                                <FP SOURCE="FP-1">Israel</FP>
                                <FP SOURCE="FP-1">Italy</FP>
                                <FP SOURCE="FP-1">Japan</FP>
                                <FP SOURCE="FP-1">Latvia</FP>
                                <FP SOURCE="FP-1">Lithuania</FP>
                                <FP SOURCE="FP-1">Luxembourg</FP>
                                <FP SOURCE="FP-1">Netherlands</FP>
                                <FP SOURCE="FP-1">Norway</FP>
                                <FP SOURCE="FP-1">Poland</FP>
                                <FP SOURCE="FP-1">Portugal</FP>
                                <FP SOURCE="FP-1">Slovenia</FP>
                                <FP SOURCE="FP-1">
                                    Spain
                                    <PRTPAGE P="562"/>
                                </FP>
                                <FP SOURCE="FP-1">Sweden</FP>
                                <FP SOURCE="FP-1">Switzerland</FP>
                                <FP SOURCE="FP-1">Turkey</FP>
                                <FP SOURCE="FP-1">United Kingdom of Great Britain and Northern Ireland.</FP>
                                <P>
                                    <E T="03">Qualifying country component</E>
                                     means a component mined, produced, or manufactured in a qualifying country.
                                </P>
                                <P>
                                    <E T="03">Qualifying country end product</E>
                                     means—
                                </P>
                                <P>(1) An unmanufactured end product mined or produced in a qualifying country; or</P>
                                <P>(2) An end product manufactured in a qualifying country if—</P>
                                <P>(i) The cost of the following types of components exceeds 60 percent of the cost of all its components, except that the percentage will be 65 percent for items delivered in calendar years 2024 through 2028 and 75 percent for items delivered starting in calendar year 2029, unless an alternate percentage is established for a contract:</P>
                                <P>(A) Components mined, produced, or manufactured in a qualifying country.</P>
                                <P>(B) Components mined, produced, or manufactured in the United States.</P>
                                <P>(C) Components of foreign origin of a class or kind for which the Government has determined that sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States. Components of unknown origin are treated as foreign; or</P>
                                <P>(ii) The end product is a COTS item.</P>
                                <P>
                                    <E T="03">Steel</E>
                                     means an alloy that includes at least 50 percent iron, between 0.02 and 2 percent carbon, and may include other elements.
                                </P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>(b) Unless otherwise specified, this clause applies to all items in the Schedule.</P>
                                <P>(c) The Contractor shall deliver under this contract only domestic end products unless, in its offer, it specified delivery of qualifying country end products, Free Trade Agreement country end products other than Bahraini end products, Korean end products, Moroccan end products, Panamanian end products, or Peruvian end products, or other foreign end products in the Buy American—Free Trade Agreements—Balance of Payments Program Certificate—Alternate IV provision of the solicitation. If the Contractor certified in its offer that it will deliver a qualifying country end product or a Free Trade Agreement country end product other than a Bahraini end product, a Korean end product, a Moroccan end product, a Panamanian end product, or a Peruvian end product, the Contractor shall deliver a qualifying country end product, a Free Trade Agreement country end product other than a Bahraini end product, a Korean end product, a Moroccan end product, a Panamanian end product, or a Peruvian end product, or, at the Contractor's option, a domestic end product.</P>
                                <P>(d) The contract price does not include duty for end products or components for which the Contractor will claim duty-free entry.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate V.</E>
                                 As prescribed in 225.1101(10)(i) and (10)(i)(F), use the following clause, which adds 
                                <E T="03">Korean end product, South Caucasus/Central and South Asian (SC/CASA) state,</E>
                                 and 
                                <E T="03">South Caucasus/Central and South Asian (SC/CASA) state end product</E>
                                 to paragraph (a), and uses a different paragraph (c) than the basic clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Buy American—Free Trade Agreements—Balance of Payments Program—Alternate V (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Bahraini end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Bahrain; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Bahrain into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Commercially available off-the-shelf (COTS) item</E>
                                    —
                                </P>
                                <P>(1) Means any item of supply (including construction material) that is—</P>
                                <P>
                                    (i) A commercial product (as defined in paragraph (1) of the definition of 
                                    <E T="03">commercial product</E>
                                     in section 2.101 of the Federal Acquisition Regulation (FAR));
                                </P>
                                <P>(ii) Sold in substantial quantities in the commercial marketplace; and</P>
                                <P>(iii) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and</P>
                                <P>(2) Does not include bulk cargo, as defined in 46 U.S.C. 40102(4), such as agricultural products and petroleum products.</P>
                                <P>
                                    <E T="03">Component</E>
                                     means an article, material, or supply incorporated directly into an end product.
                                </P>
                                <P>
                                    <E T="03">Critical component</E>
                                     means a component that is mined, produced, or manufactured in the United States and deemed critical to the U.S. supply chain. The list of critical components is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Critical item</E>
                                     means domestic construction material or a domestic end product that is deemed critical to the U.S. supply chain. The list of critical items is at FAR 25.105.
                                    <PRTPAGE P="563"/>
                                </P>
                                <P>
                                    <E T="03">Domestic end product</E>
                                     means—
                                </P>
                                <P>(1) For an end product that does not consist wholly or predominantly of iron or steel or a combination of both—</P>
                                <P>(i) An unmanufactured end product mined or produced in the United States; or</P>
                                <P>(ii) An end product manufactured in the United States if—</P>
                                <P>(A) The cost of its qualifying country components and its components that are mined, produced, or manufactured in the United States exceeds 60 percent of the cost of all its components, except that the percentage will be 65 percent for items delivered in calendar years 2024 through 2028 and 75 percent for items delivered starting in calendar year 2029, unless an alternate percentage is established for a contract in accordance with Defense Federal Acquisition Regulation Supplement (DFARS) 225.101(d); or award is made before January 1, 2030, for a foreign end product that exceeds 55 percent domestic content (see DFARS 225.103(b)(ii)). The cost of components includes transportation costs to the place of incorporation into the end product and U.S. duty (whether or not a duty-free entry certificate is issued). Components of unknown origin are treated as foreign. Scrap generated, collected, and prepared for processing in the United States is considered domestic. A component is considered to have been mined, produced, or manufactured in the United States (regardless of its source in fact) if the end product in which it is incorporated is manufactured in the United States and the component is of a class or kind for which the Government has determined that—</P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) Sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States; or
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) It is inconsistent with the public interest to apply the restrictions of the Buy American statute; or
                                </P>
                                <P>(B) The end product is a COTS item; or</P>
                                <P>(2) For an end product that consists wholly or predominantly of iron or steel or a combination of both, an end product manufactured in the United States, if the cost of iron and steel not produced in the United States or a qualifying country constitutes less than 5 percent of the cost of all the components used in the end product (produced in the United States or a qualifying country means that all manufacturing processes of the iron or steel must take place in the United States or a qualifying country, except metallurgical processes involving refinement of steel additives). The cost of iron and steel not produced in the United States or a qualifying country includes but is not limited to the cost of iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings, not produced in the United States or a qualifying country, utilized in the manufacture of the end product and a good faith estimate of the cost of all iron or steel components not produced in the United States or a qualifying country, excluding COTS fasteners. Iron or steel components of unknown origin are treated as foreign. If the end product contains multiple components, the cost of all the materials used in such end product is calculated in accordance with the explanation of cost of components in paragraph (1)(ii)(A) of this definition.</P>
                                <P>
                                    <E T="03">End product</E>
                                     means those articles, materials, and supplies to be acquired under this contract for public use.
                                </P>
                                <P>
                                    <E T="03">Foreign end product</E>
                                     means an end product other than a domestic end product.
                                </P>
                                <P>
                                    <E T="03">Free Trade Agreement country</E>
                                     means Australia, Bahrain, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua, Panama, Peru, or Singapore.
                                </P>
                                <P>
                                    <E T="03">Free Trade Agreement country end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a Free Trade Agreement country; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in a Free Trade Agreement country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Korean end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Korea; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Korea (Republic of) into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product, includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Moroccan end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Morocco; or</P>
                                <P>
                                    (2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Morocco into a new and different article 
                                    <PRTPAGE P="564"/>
                                    of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.
                                </P>
                                <P>
                                    <E T="03">Panamanian end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Panama; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Panama into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Peruvian end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Peru; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Peru into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Predominantly of iron or steel or a combination of both</E>
                                     means that the cost of the iron and steel content exceeds 50 percent of the total cost of all its components. The cost of iron and steel is the cost of the iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings utilized in the manufacture of the product and a good faith estimate of the cost of iron or steel components excluding COTS fasteners.
                                </P>
                                <P>
                                    <E T="03">Qualifying country</E>
                                     means a country with a reciprocal defense procurement memorandum of understanding or international agreement with the United States in which both countries agree to remove barriers to purchases of supplies produced in the other country or services performed by sources of the other country, and the memorandum or agreement complies, where applicable, with the requirements of section 36 of the Arms Export Control Act (22 U.S.C. 2776) and with 10 U.S.C. 2457. Accordingly, the following are qualifying countries:
                                </P>
                                <FP SOURCE="FP-1">Australia</FP>
                                <FP SOURCE="FP-1">Austria</FP>
                                <FP SOURCE="FP-1">Belgium</FP>
                                <FP SOURCE="FP-1">Canada</FP>
                                <FP SOURCE="FP-1">Czech Republic</FP>
                                <FP SOURCE="FP-1">Denmark</FP>
                                <FP SOURCE="FP-1">Egypt</FP>
                                <FP SOURCE="FP-1">Estonia</FP>
                                <FP SOURCE="FP-1">Finland</FP>
                                <FP SOURCE="FP-1">France</FP>
                                <FP SOURCE="FP-1">Germany</FP>
                                <FP SOURCE="FP-1">Greece</FP>
                                <FP SOURCE="FP-1">Israel</FP>
                                <FP SOURCE="FP-1">Italy</FP>
                                <FP SOURCE="FP-1">Japan</FP>
                                <FP SOURCE="FP-1">Latvia</FP>
                                <FP SOURCE="FP-1">Lithuania</FP>
                                <FP SOURCE="FP-1">Luxembourg</FP>
                                <FP SOURCE="FP-1">Netherlands</FP>
                                <FP SOURCE="FP-1">Norway</FP>
                                <FP SOURCE="FP-1">Poland</FP>
                                <FP SOURCE="FP-1">Portugal</FP>
                                <FP SOURCE="FP-1">Slovenia</FP>
                                <FP SOURCE="FP-1">Spain</FP>
                                <FP SOURCE="FP-1">Sweden</FP>
                                <FP SOURCE="FP-1">Switzerland</FP>
                                <FP SOURCE="FP-1">Turkey</FP>
                                <FP SOURCE="FP-1">United Kingdom of Great Britain and Northern Ireland.</FP>
                                <P>
                                    <E T="03">Qualifying country component</E>
                                     means a component mined, produced, or manufactured in a qualifying country.
                                </P>
                                <P>
                                    <E T="03">Qualifying country end product</E>
                                     means—
                                </P>
                                <P>(1) An unmanufactured end product mined or produced in a qualifying country; or</P>
                                <P>(2) An end product manufactured in a qualifying country if—</P>
                                <P>(i) The cost of the following types of components exceeds 60 percent of the cost of all its components, except that the percentage will be 65 percent for items delivered in calendar years 2024 through 2028 and 75 percent for items delivered starting in calendar year 2029, unless an alternate percentage is established for a contract:</P>
                                <P>(A) Components mined, produced, or manufactured in a qualifying country.</P>
                                <P>(B) Components mined, produced, or manufactured in the United States.</P>
                                <P>(C) Components of foreign origin of a class or kind for which the Government has determined that sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States. Components of unknown origin are treated as foreign; or</P>
                                <P>(ii) The end product is a COTS item.</P>
                                <P>
                                    <E T="03">South Caucasus/Central and South Asian (SC/CASA) state</E>
                                     means Armenia, Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, Pakistan, Tajikistan, Turkmenistan, or Uzbekistan.
                                </P>
                                <P>
                                    <E T="03">South Caucasus/Central and South Asian (SC/CASA) state end product</E>
                                     means an article that—
                                    <PRTPAGE P="565"/>
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of an SC/CASA state; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in an SC/CASA state into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product, includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Steel</E>
                                     means an alloy that includes at least 50 percent iron, between 0.02 and 2 percent carbon, and may include other elements.
                                </P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>(b) Unless otherwise specified, this clause applies to all items in the Schedule.</P>
                                <P>(c) The Contractor shall deliver under this contract only domestic end products unless, in its offer, it specified delivery of qualifying country end products, SC/CASA state end products, Free Trade Agreement country end products other than Bahraini end products, Korean end products, Moroccan end products, Panamanian end products, or Peruvian end products, or other foreign end products in the Buy American—Free Trade Agreements—Balance of Payments Program Certificate—Alternate V provision of the solicitation. If the Contractor certified in its offer that it will deliver a qualifying country end product, SC/CASA state end products, or a Free Trade Agreement country end product other than a Bahraini end product, a Korean end product, a Moroccan end product, a Panamanian end product, or a Peruvian end product, the Contractor shall deliver a qualifying country end product, an SC/CASA state end product, a Free Trade Agreement country end product other than a Bahraini end product, a Korean end product, a Moroccan end product, a Panamanian end product, or a Peruvian end product or, at the Contractor's option, a domestic end product.</P>
                                <P>(d) The contract price does not include duty for end products or components for which the Contractor will claim duty-free entry.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate VI.</E>
                                 As prescribed in 225.1101(10)(i) and (10)(i)(G), use the following clause, which includes, in the definitions of “domestic end product” at paragraph (1)(ii)(A) and “qualifying country end product” at paragraph (2)(i), the domestic content threshold that will apply to the entire contract period of performance:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Buy American—Free Trade Agreements—Balance of Payments Program—Alternate VI (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Bahraini end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Bahrain; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Bahrain into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Commercially available off-the-shelf (COTS) item</E>
                                    —
                                </P>
                                <P>(1) Means any item of supply (including construction material) that is—</P>
                                <P>(i) A commercial product (as defined in paragraph (1) of the definition of “commercial product” in section 2.101 of the Federal Acquisition Regulation (FAR));</P>
                                <P>(ii) Sold in substantial quantities in the commercial marketplace; and</P>
                                <P>(iii) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and</P>
                                <P>(2) Does not include bulk cargo, as defined in 46 U.S.C. 40102(4), such as agricultural products and petroleum products.</P>
                                <P>
                                    <E T="03">Component</E>
                                     means an article, material, or supply incorporated directly into an end product.
                                </P>
                                <P>
                                    <E T="03">Critical component</E>
                                     means a component that is mined, produced, or manufactured in the United States and deemed critical to the U.S. supply chain. The list of critical components is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Critical item</E>
                                     means domestic construction material or a domestic end product that is deemed critical to the U.S. supply chain. The list of critical items is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Domestic end product</E>
                                     means—
                                </P>
                                <P>(1) For an end product that does not consist wholly or predominantly of iron or steel or a combination of both—</P>
                                <P>(i) An unmanufactured end product mined or produced in the United States; or</P>
                                <P>(ii) An end product manufactured in the United States if—</P>
                                <P>
                                    (A) The cost of its qualifying country components and its components that are mined, produced, or manufactured in the United States exceeds, for the entire period of performance for a contract awarded in: calendar year 2023, 60 percent of the cost of all its components; calendar years 2024 through 
                                    <PRTPAGE P="566"/>
                                    2028, 65 percent of the cost of all its components; or calendar year 2029 or later, 75 percent of the cost of all its components. The cost of components includes transportation costs to the place of incorporation into the end product and U.S. duty (whether or not a duty-free entry certificate is issued). Components of unknown origin are treated as foreign. Scrap generated, collected, and prepared for processing in the United States is considered domestic. A component is considered to have been mined, produced, or manufactured in the United States (regardless of its source in fact) if the end product in which it is incorporated is manufactured in the United States and the component is of a class or kind for which the Government has determined that—
                                </P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) Sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States; or
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) It is inconsistent with the public interest to apply the restrictions of the Buy American statute; or
                                </P>
                                <P>(B) The end product is a COTS item; or</P>
                                <P>(2) For an end product that consists wholly or predominantly of iron or steel or a combination of both, an end product manufactured in the United States, if the cost of iron and steel not produced in the United States or a qualifying country constitutes less than 5 percent of the cost of all the components used in the end product (produced in the United States or a qualifying country means that all manufacturing processes of the iron or steel must take place in the United States or a qualifying country, except metallurgical processes involving refinement of steel additives). The cost of iron and steel not produced in the United States or a qualifying country includes but is not limited to the cost of iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings, not produced in the United States or a qualifying country, utilized in the manufacture of the end product and a good faith estimate of the cost of all iron or steel components not produced in the United States or a qualifying country, excluding COTS fasteners. Iron or steel components of unknown origin are treated as foreign. If the end product contains multiple components, the cost of all the materials used in such end product is calculated in accordance with the explanation of cost of components in paragraph (1)(ii)(A) of this definition.</P>
                                <P>
                                    <E T="03">End product</E>
                                     means those articles, materials, and supplies to be acquired under this contract for public use.
                                </P>
                                <P>
                                    <E T="03">Foreign end product</E>
                                     means an end product other than a domestic end product.
                                </P>
                                <P>
                                    <E T="03">Free Trade Agreement country</E>
                                     means Australia, Bahrain, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua, Panama, Peru, or Singapore.
                                </P>
                                <P>
                                    <E T="03">Free Trade Agreement country end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a Free Trade Agreement country; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in a Free Trade Agreement country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Moroccan end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Morocco; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Morocco into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Panamanian end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Panama; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Panama into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Peruvian end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Peru; or</P>
                                <P>
                                    (2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Peru into a new and different article of commerce with a name, character, or use 
                                    <PRTPAGE P="567"/>
                                    distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.
                                </P>
                                <P>
                                    <E T="03">Predominantly of iron or steel or a combination of both</E>
                                     means that the cost of the iron and steel content exceeds 50 percent of the total cost of all its components. The cost of iron and steel is the cost of the iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings utilized in the manufacture of the product and a good faith estimate of the cost of iron or steel components excluding COTS fasteners.
                                </P>
                                <P>
                                    <E T="03">Qualifying country</E>
                                     means a country with a reciprocal defense procurement memorandum of understanding or international agreement with the United States in which both countries agree to remove barriers to purchases of supplies produced in the other country or services performed by sources of the other country, and the memorandum or agreement complies, where applicable, with the requirements of section 36 of the Arms Export Control Act (22 U.S.C. 2776) and with 10 U.S.C. 2457. Accordingly, the following are qualifying countries:
                                </P>
                                <FP SOURCE="FP-1">Australia</FP>
                                <FP SOURCE="FP-1">Austria</FP>
                                <FP SOURCE="FP-1">Belgium</FP>
                                <FP SOURCE="FP-1">Canada</FP>
                                <FP SOURCE="FP-1">Czech Republic</FP>
                                <FP SOURCE="FP-1">Denmark</FP>
                                <FP SOURCE="FP-1">Egypt</FP>
                                <FP SOURCE="FP-1">Estonia</FP>
                                <FP SOURCE="FP-1">Finland</FP>
                                <FP SOURCE="FP-1">France</FP>
                                <FP SOURCE="FP-1">Germany</FP>
                                <FP SOURCE="FP-1">Greece</FP>
                                <FP SOURCE="FP-1">Israel</FP>
                                <FP SOURCE="FP-1">Italy</FP>
                                <FP SOURCE="FP-1">Japan</FP>
                                <FP SOURCE="FP-1">Latvia</FP>
                                <FP SOURCE="FP-1">Lithuania</FP>
                                <FP SOURCE="FP-1">Luxembourg</FP>
                                <FP SOURCE="FP-1">Netherlands</FP>
                                <FP SOURCE="FP-1">Norway</FP>
                                <FP SOURCE="FP-1">Poland</FP>
                                <FP SOURCE="FP-1">Portugal</FP>
                                <FP SOURCE="FP-1">Slovenia</FP>
                                <FP SOURCE="FP-1">Spain</FP>
                                <FP SOURCE="FP-1">Sweden</FP>
                                <FP SOURCE="FP-1">Switzerland</FP>
                                <FP SOURCE="FP-1">Turkey</FP>
                                <FP SOURCE="FP-1">United Kingdom of Great Britain and Northern Ireland.</FP>
                                <P>
                                    <E T="03">Qualifying country component</E>
                                     means a component mined, produced, or manufactured in a qualifying country.
                                </P>
                                <P>
                                    <E T="03">Qualifying country end product</E>
                                     means—
                                </P>
                                <P>(1) An unmanufactured end product mined or produced in a qualifying country; or</P>
                                <P>(2) An end product manufactured in a qualifying country if—</P>
                                <P>(i) The cost of the following types of components exceeds, for the entire period of performance for a contract awarded in: calendar year 2023, 60 percent of the cost of all its components; calendar years 2024 through 2028, 65 percent of the cost of all its components; or calendar year 2029 or later, 75 percent of the cost of all its components:</P>
                                <P>(A) Components mined, produced, or manufactured in a qualifying country.</P>
                                <P>(B) Components mined, produced, or manufactured in the United States.</P>
                                <P>(C) Components of foreign origin of a class or kind for which the Government has determined that sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States. Components of unknown origin are treated as foreign; or</P>
                                <P>(ii) The end product is a COTS item.</P>
                                <P>
                                    <E T="03">Steel</E>
                                     means an alloy that includes at least 50 percent iron, between 0.02 and 2 percent carbon, and may include other elements.
                                </P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>(b) Unless otherwise specified, this clause applies to all items in the Schedule.</P>
                                <P>(c) The Contractor shall deliver under this contract only domestic end products unless, in its offer, it specified delivery of qualifying country end products, Free Trade Agreement country end products other than Bahraini end products, Moroccan end products, Panamanian end products, or Peruvian end products, or other foreign end products in the Buy American—Free Trade Agreements—Balance of Payments Program Certificate—Basic provision of the solicitation. If the Contractor certified in its offer that it will deliver a qualifying country end product or a Free Trade Agreement country end product other than a Bahraini end product, a Moroccan end product, a Panamanian end product, or a Peruvian end product, the Contractor shall deliver a qualifying country end product, a Free Trade Agreement country end product other than a Bahraini end product, a Moroccan end product, a Panamanian end product, or a Peruvian end product, or, at the Contractor's option, a domestic end product.</P>
                                <P>(d) The contract price does not include duty for end products or components for which the Contractor will claim duty-free entry.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate VII.</E>
                                 As prescribed in 225.1101(10)(i) and (10)(i)(H), use the following clause, which includes, in the definitions of “domestic end product” at paragraph (1)(ii)(A) and “qualifying country end product” at paragraph 
                                <PRTPAGE P="568"/>
                                (2)(i), the domestic content threshold that will apply to the entire contract period of performance and uses a different paragraph (c) than the basic clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Buy American—Free Trade Agreements—Balance of Payments Program—Alternate VII (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Bahraini end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Bahrain; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Bahrain into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Commercially available off-the-shelf (COTS) item</E>
                                    —
                                </P>
                                <P>(1) Means any item of supply (including construction material) that is—</P>
                                <P>(i) A commercial product (as defined in paragraph (1) of the definition of “commercial product” in section 2.101 of the Federal Acquisition Regulation (FAR));</P>
                                <P>(ii) Sold in substantial quantities in the commercial marketplace; and</P>
                                <P>(iii) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and</P>
                                <P>(2) Does not include bulk cargo, as defined in 46 U.S.C. 40102(4), such as agricultural products and petroleum products.</P>
                                <P>
                                    <E T="03">Component</E>
                                     means an article, material, or supply incorporated directly into an end product.
                                </P>
                                <P>
                                    <E T="03">Critical component</E>
                                     means a component that is mined, produced, or manufactured in the United States and deemed critical to the U.S. supply chain. The list of critical components is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Critical item</E>
                                     means domestic construction material or a domestic end product that is deemed critical to the U.S. supply chain. The list of critical items is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Domestic end product</E>
                                     means—
                                </P>
                                <P>(1) For an end product that does not consist wholly or predominantly of iron or steel or a combination of both—</P>
                                <P>(i) An unmanufactured end product mined or produced in the United States; or</P>
                                <P>(ii) An end product manufactured in the United States if—</P>
                                <P>(A) The cost of its qualifying country components and its components that are mined, produced, or manufactured in the United States exceeds, for the entire period of performance for a contract awarded in: calendar year 2023, 60 percent of the cost of all its components; calendar years 2024 through 2028, 65 percent of the cost of all its components; or calendar year 2029 or later, 75 percent of the cost of all its components. The cost of components includes transportation costs to the place of incorporation into the end product and U.S. duty (whether or not a duty-free entry certificate is issued). Components of unknown origin are treated as foreign. Scrap generated, collected, and prepared for processing in the United States is considered domestic. A component is considered to have been mined, produced, or manufactured in the United States (regardless of its source in fact) if the end product in which it is incorporated is manufactured in the United States and the component is of a class or kind for which the Government has determined that—</P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) Sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States; or
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) It is inconsistent with the public interest to apply the restrictions of the Buy American statute; or
                                </P>
                                <P>(B) The end product is a COTS item; or</P>
                                <P>(2) For an end product that consists wholly or predominantly of iron or steel or a combination of both, an end product manufactured in the United States, if the cost of iron and steel not produced in the United States or a qualifying country constitutes less than 5 percent of the cost of all the components used in the end product (produced in the United States or a qualifying country means that all manufacturing processes of the iron or steel must take place in the United States or a qualifying country, except metallurgical processes involving refinement of steel additives). The cost of iron and steel not produced in the United States or a qualifying country includes but is not limited to the cost of iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings, not produced in the United States or a qualifying country, utilized in the manufacture of the end product and a good faith estimate of the cost of all iron or steel components not produced in the United States or a qualifying country, excluding COTS fasteners. Iron or steel components of unknown origin are treated as foreign. If the end product contains multiple components, the cost of all the materials used in such end product is calculated in accordance with the explanation of cost of components in paragraph (1)(ii)(A) of this definition.</P>
                                <P>
                                    <E T="03">End product</E>
                                     means those articles, materials, and supplies to be acquired under this contract for public use.
                                    <PRTPAGE P="569"/>
                                </P>
                                <P>
                                    <E T="03">Foreign end product</E>
                                     means an end product other than a domestic end product.
                                </P>
                                <P>
                                    <E T="03">Free Trade Agreement country</E>
                                     means Australia, Bahrain, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua, Panama, Peru, or Singapore.
                                </P>
                                <P>
                                    <E T="03">Free Trade Agreement country end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a Free Trade Agreement country; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in a Free Trade Agreement country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Moroccan end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Morocco; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Morocco into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Panamanian end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Panama; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Panama into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Peruvian end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Peru; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Peru into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Predominantly of iron or steel or a combination of both</E>
                                     means that the cost of the iron and steel content exceeds 50 percent of the total cost of all its components. The cost of iron and steel is the cost of the iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings utilized in the manufacture of the product and a good faith estimate of the cost of iron or steel components excluding COTS fasteners.
                                </P>
                                <P>
                                    <E T="03">Qualifying country</E>
                                     means a country with a reciprocal defense procurement memorandum of understanding or international agreement with the United States in which both countries agree to remove barriers to purchases of supplies produced in the other country or services performed by sources of the other country, and the memorandum or agreement complies, where applicable, with the requirements of section 36 of the Arms Export Control Act (22 U.S.C. 2776) and with 10 U.S.C. 2457. Accordingly, the following are qualifying countries:
                                </P>
                                <FP SOURCE="FP-1">Australia</FP>
                                <FP SOURCE="FP-1">Austria</FP>
                                <FP SOURCE="FP-1">Belgium</FP>
                                <FP SOURCE="FP-1">Canada</FP>
                                <FP SOURCE="FP-1">Czech Republic</FP>
                                <FP SOURCE="FP-1">Denmark</FP>
                                <FP SOURCE="FP-1">Egypt</FP>
                                <FP SOURCE="FP-1">Estonia</FP>
                                <FP SOURCE="FP-1">Finland</FP>
                                <FP SOURCE="FP-1">France</FP>
                                <FP SOURCE="FP-1">Germany</FP>
                                <FP SOURCE="FP-1">Greece</FP>
                                <FP SOURCE="FP-1">Israel</FP>
                                <FP SOURCE="FP-1">Italy</FP>
                                <FP SOURCE="FP-1">Japan</FP>
                                <FP SOURCE="FP-1">Latvia</FP>
                                <FP SOURCE="FP-1">Lithuania</FP>
                                <FP SOURCE="FP-1">Luxembourg</FP>
                                <FP SOURCE="FP-1">Netherlands</FP>
                                <FP SOURCE="FP-1">Norway</FP>
                                <FP SOURCE="FP-1">Poland</FP>
                                <FP SOURCE="FP-1">Portugal</FP>
                                <FP SOURCE="FP-1">Slovenia</FP>
                                <FP SOURCE="FP-1">Spain</FP>
                                <FP SOURCE="FP-1">Sweden</FP>
                                <FP SOURCE="FP-1">Switzerland</FP>
                                <FP SOURCE="FP-1">
                                    Turkey
                                    <PRTPAGE P="570"/>
                                </FP>
                                <FP SOURCE="FP-1">United Kingdom of Great Britain and Northern Ireland.</FP>
                                <P>
                                    <E T="03">Qualifying country component</E>
                                     means a component mined, produced, or manufactured in a qualifying country.
                                </P>
                                <P>
                                    <E T="03">Qualifying country end product</E>
                                     means—
                                </P>
                                <P>(1) An unmanufactured end product mined or produced in a qualifying country; or</P>
                                <P>(2) An end product manufactured in a qualifying country if—</P>
                                <P>(i) The cost of the following types of components exceeds, for the entire period of performance for a contract awarded in: calendar year 2023, 60 percent of the cost of all its components; calendar years 2024 through 2028, 65 percent of the cost of all its components; or calendar year 2029 or later, 75 percent of the cost of all its components:</P>
                                <P>(A) Components mined, produced, or manufactured in a qualifying country.</P>
                                <P>(B) Components mined, produced, or manufactured in the United States.</P>
                                <P>(C) Components of foreign origin of a class or kind for which the Government has determined that sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States. Components of unknown origin are treated as foreign; or</P>
                                <P>(ii) The end product is a COTS item.</P>
                                <P>
                                    <E T="03">Steel</E>
                                     means an alloy that includes at least 50 percent iron, between 0.02 and 2 percent carbon, and may include other elements.
                                </P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>(b) Unless otherwise specified, this clause applies to all items in the Schedule.</P>
                                <P>(c) The Contractor shall deliver under this contract only domestic end products unless, in its offer, it specified delivery of qualifying country or other foreign end products in the Buy American—Free Trade Agreements—Balance of Payments Program Certificate—Alternate I provision of the solicitation. If the Contractor certified in its offer that it will deliver a qualifying country end product, the Contractor shall deliver a qualifying country end product or, at the Contractor's option, a domestic end product.</P>
                                <P>(d) The contract price does not include duty for end products or components for which the Contractor will claim duty-free entry.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate VIII.</E>
                                 As prescribed in 225.1101(10)(i) and (10)(i)(I), use the following clause, which includes, in the definitions of “domestic end product” at paragraph (1)(ii)(A) and “qualifying country end product” at paragraph (2)(i), the domestic content threshold that will apply to the entire contract period of performance; adds “South Caucasus/Central and South Asian (SC/CASA) state” and “South Caucasus/Central and South Asian (SC/CASA) state end product” to paragraph (a); and uses a different paragraph (c) than the basic clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Buy American—Free Trade Agreements—Balance of Payments Program—Alternate VIII (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Bahraini end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Bahrain; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Bahrain into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Commercially available off-the-shelf (COTS) item</E>
                                    —
                                </P>
                                <P>(1) Means any item of supply (including construction material) that is—</P>
                                <P>(i) A commercial product (as defined in paragraph (1) of the definition of “commercial product” in section 2.101 of the Federal Acquisition Regulation (FAR));</P>
                                <P>(ii) Sold in substantial quantities in the commercial marketplace; and</P>
                                <P>(iii) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and</P>
                                <P>(2) Does not include bulk cargo, as defined in 46 U.S.C. 40102(4), such as agricultural products and petroleum products.</P>
                                <P>
                                    <E T="03">Component</E>
                                     means an article, material, or supply incorporated directly into an end product.
                                </P>
                                <P>
                                    <E T="03">Critical component</E>
                                     means a component that is mined, produced, or manufactured in the United States and deemed critical to the U.S. supply chain. The list of critical components is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Critical item</E>
                                     means domestic construction material or a domestic end product that is deemed critical to the U.S. supply chain. The list of critical items is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Domestic end product</E>
                                     means—
                                </P>
                                <P>(1) For an end product that does not consist wholly or predominantly of iron or steel or a combination of both—</P>
                                <P>(i) An unmanufactured end product mined or produced in the United States; or</P>
                                <P>
                                    (ii) An end product manufactured in the United States if—
                                    <PRTPAGE P="571"/>
                                </P>
                                <P>(A) The cost of its qualifying country components and its components that are mined, produced, or manufactured in the United States exceeds, for the entire period of performance for a contract awarded in: calendar year 2023, 60 percent of the cost of all its components; calendar years 2024 through 2028, 65 percent of the cost of all its components; or calendar year 2029 or later, 75 percent of the cost of all its components. The cost of components includes transportation costs to the place of incorporation into the end product and U.S. duty (whether or not a duty-free entry certificate is issued). Components of unknown origin are treated as foreign. Scrap generated, collected, and prepared for processing in the United States is considered domestic. A component is considered to have been mined, produced, or manufactured in the United States (regardless of its source in fact) if the end product in which it is incorporated is manufactured in the United States and the component is of a class or kind for which the Government has determined that—</P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) Sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States; or
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) It is inconsistent with the public interest to apply the restrictions of the Buy American statute; or
                                </P>
                                <P>(B) The end product is a COTS item; or</P>
                                <P>(2) For an end product that consists wholly or predominantly of iron or steel or a combination of both, an end product manufactured in the United States, if the cost of iron and steel not produced in the United States or a qualifying country constitutes less than 5 percent of the cost of all the components used in the end product (produced in the United States or a qualifying country means that all manufacturing processes of the iron or steel must take place in the United States or a qualifying country, except metallurgical processes involving refinement of steel additives). The cost of iron and steel not produced in the United States or a qualifying country includes but is not limited to the cost of iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings, not produced in the United States or a qualifying country, utilized in the manufacture of the end product and a good faith estimate of the cost of all iron or steel components not produced in the United States or a qualifying country, excluding COTS fasteners. Iron or steel components of unknown origin are treated as foreign. If the end product contains multiple components, the cost of all the materials used in such end product is calculated in accordance with the explanation of cost of components in paragraph (1)(ii)(A) of this definition.</P>
                                <P>
                                    <E T="03">End product</E>
                                     means those articles, materials, and supplies to be acquired under this contract for public use.
                                </P>
                                <P>
                                    <E T="03">Foreign end product</E>
                                     means an end product other than a domestic end product.
                                </P>
                                <P>
                                    <E T="03">Free Trade Agreement country</E>
                                     means Australia, Bahrain, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua, Panama, Peru, or Singapore.
                                </P>
                                <P>
                                    <E T="03">Free Trade Agreement country end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a Free Trade Agreement country; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in a Free Trade Agreement country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Moroccan end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Morocco; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Morocco into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Panamanian end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Panama; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Panama into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Peruvian end product</E>
                                     means an article that—
                                    <PRTPAGE P="572"/>
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Peru; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Peru into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Predominantly of iron or steel or a combination of both</E>
                                     means that the cost of the iron and steel content exceeds 50 percent of the total cost of all its components. The cost of iron and steel is the cost of the iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings utilized in the manufacture of the product and a good faith estimate of the cost of iron or steel components excluding COTS fasteners.
                                </P>
                                <P>
                                    <E T="03">Qualifying country</E>
                                     means a country with a reciprocal defense procurement memorandum of understanding or international agreement with the United States in which both countries agree to remove barriers to purchases of supplies produced in the other country or services performed by sources of the other country, and the memorandum or agreement complies, where applicable, with the requirements of section 36 of the Arms Export Control Act (22 U.S.C. 2776) and with 10 U.S.C. 2457. Accordingly, the following are qualifying countries:
                                </P>
                                <FP SOURCE="FP-1">Australia</FP>
                                <FP SOURCE="FP-1">Austria</FP>
                                <FP SOURCE="FP-1">Belgium</FP>
                                <FP SOURCE="FP-1">Canada</FP>
                                <FP SOURCE="FP-1">Czech Republic</FP>
                                <FP SOURCE="FP-1">Denmark</FP>
                                <FP SOURCE="FP-1">Egypt</FP>
                                <FP SOURCE="FP-1">Estonia</FP>
                                <FP SOURCE="FP-1">Finland</FP>
                                <FP SOURCE="FP-1">France</FP>
                                <FP SOURCE="FP-1">Germany</FP>
                                <FP SOURCE="FP-1">Greece</FP>
                                <FP SOURCE="FP-1">Israel</FP>
                                <FP SOURCE="FP-1">Italy</FP>
                                <FP SOURCE="FP-1">Japan</FP>
                                <FP SOURCE="FP-1">Latvia</FP>
                                <FP SOURCE="FP-1">Lithuania</FP>
                                <FP SOURCE="FP-1">Luxembourg</FP>
                                <FP SOURCE="FP-1">Netherlands</FP>
                                <FP SOURCE="FP-1">Norway</FP>
                                <FP SOURCE="FP-1">Poland</FP>
                                <FP SOURCE="FP-1">Portugal</FP>
                                <FP SOURCE="FP-1">Slovenia</FP>
                                <FP SOURCE="FP-1">Spain</FP>
                                <FP SOURCE="FP-1">Sweden</FP>
                                <FP SOURCE="FP-1">Switzerland</FP>
                                <FP SOURCE="FP-1">Turkey</FP>
                                <FP SOURCE="FP-1">United Kingdom of Great Britain and Northern Ireland</FP>
                                <P>
                                    <E T="03">Qualifying country component</E>
                                     means a component mined, produced, or manufactured in a qualifying country.
                                </P>
                                <P>
                                    <E T="03">Qualifying country end product</E>
                                     means—
                                </P>
                                <P>(1) An unmanufactured end product mined or produced in a qualifying country; or</P>
                                <P>(2) An end product manufactured in a qualifying country if—</P>
                                <P>(i) The cost of the following types of components exceeds, for the entire period of performance for a contract awarded in: calendar year 2023, 60 percent of the cost of all its components; calendar years 2024 through 2028, 65 percent of the cost of all its components; or calendar year 2029 or later, 75 percent of the cost of all its components:</P>
                                <P>(A) Components mined, produced, or manufactured in a qualifying country.</P>
                                <P>(B) Components mined, produced, or manufactured in the United States.</P>
                                <P>(C) Components of foreign origin of a class or kind for which the Government has determined that sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States. Components of unknown origin are treated as foreign; or</P>
                                <P>(ii) The end product is a COTS item.</P>
                                <P>
                                    <E T="03">South Caucasus/Central and South Asian (SC/CASA) state</E>
                                     means Armenia, Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, Pakistan, Tajikistan, Turkmenistan, or Uzbekistan.
                                </P>
                                <P>
                                    <E T="03">South Caucasus/Central and South Asian (SC/CASA) state end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of an SC/CASA state; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in an SC/CASA state into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Steel</E>
                                     means an alloy that includes at least 50 percent iron, between 0.02 and 2 percent carbon, and may include other elements.
                                </P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>(b) Unless otherwise specified, this clause applies to all items in the Schedule.</P>
                                <P>
                                    (c) The Contractor shall deliver under this contract only domestic end products unless, in its offer, it specified delivery of qualifying country end products, SC/CASA state end products, Free Trade Agreement country end products other than Bahraini end products, Moroccan end products, Panamanian end 
                                    <PRTPAGE P="573"/>
                                    products, or Peruvian end products, or other foreign end products in the Buy American—Free Trade Agreements—Balance of Payments Program Certificate—Alternate II provision of the solicitation. If the Contractor certified in its offer that it will deliver a qualifying country end product, SC/CASA state end products, or a Free Trade Agreement country end product other than a Bahraini end product, a Moroccan end product, a Panamanian end product, or a Peruvian end product, the Contractor shall deliver a qualifying country end product, an SC/CASA state end product, a Free Trade Agreement country end product other than a Bahraini end product, a Moroccan end product, a Panamanian end product, or a Peruvian end product or, at the Contractor's option, a domestic end product.
                                </P>
                                <P>(d) The contract price does not include duty for end products or components for which the Contractor will claim duty-free entry.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate IX.</E>
                                 As prescribed in 225.1101(10)(i) and (10)(i)(J), use the following clause, which includes in the definitions of “domestic end product” at paragraph (1)(ii)(A) and “qualifying country end product” at paragraph (2)(i) the domestic content threshold that will apply to the entire contract period of performance; adds “South Caucasus/Central and South Asian (SC/CASA) state” and “South Caucasus/Central and South Asian (SC/CASA) state end product” to paragraph (a); and uses a different paragraph (c) than the basic clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Buy American—Free Trade Agreements—Balance of Payments Program—Alternate IX (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Bahraini end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Bahrain; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Bahrain into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Commercially available off-the-shelf (COTS) item</E>
                                    —
                                </P>
                                <P>(1) Means any item of supply (including construction material) that is—</P>
                                <P>(i) A commercial product (as defined in paragraph (1) of the definition of “commercial product” in section 2.101 of the Federal Acquisition Regulation (FAR));</P>
                                <P>(ii) Sold in substantial quantities in the commercial marketplace; and</P>
                                <P>(iii) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and</P>
                                <P>(2) Does not include bulk cargo, as defined in 46 U.S.C. 40102(4), such as agricultural products and petroleum products.</P>
                                <P>
                                    <E T="03">Component</E>
                                     means an article, material, or supply incorporated directly into an end product.
                                </P>
                                <P>
                                    <E T="03">Critical component</E>
                                     means a component that is mined, produced, or manufactured in the United States and deemed critical to the U.S. supply chain. The list of critical components is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Critical item</E>
                                     means domestic construction material or a domestic end product that is deemed critical to the U.S. supply chain. The list of critical items is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Domestic end product</E>
                                     means—
                                </P>
                                <P>(1) For an end product that does not consist wholly or predominantly of iron or steel or a combination of both—</P>
                                <P>(i) An unmanufactured end product mined or produced in the United States; or</P>
                                <P>(ii) An end product manufactured in the United States if—</P>
                                <P>(A) The cost of its qualifying country components and its components that are mined, produced, or manufactured in the United States exceeds, for the entire period of performance for a contract awarded in: calendar year 2023, 60 percent of the cost of all its components; calendar years 2024 through 2028, 65 percent of the cost of all its components; or calendar year 2029 or later, 75 percent of the cost of all its components. The cost of components includes transportation costs to the place of incorporation into the end product and U.S. duty (whether or not a duty-free entry certificate is issued). Components of unknown origin are treated as foreign. Scrap generated, collected, and prepared for processing in the United States is considered domestic. A component is considered to have been mined, produced, or manufactured in the United States (regardless of its source in fact) if the end product in which it is incorporated is manufactured in the United States and the component is of a class or kind for which the Government has determined that—</P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) Sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States; or
                                    <PRTPAGE P="574"/>
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) It is inconsistent with the public interest to apply the restrictions of the Buy American statute; or
                                </P>
                                <P>(B) The end product is a COTS item; or</P>
                                <P>(2) For an end product that consists wholly or predominantly of iron or steel or a combination of both, an end product manufactured in the United States, if the cost of iron and steel not produced in the United States or a qualifying country constitutes less than 5 percent of the cost of all the components used in the end product (produced in the United States or a qualifying country means that all manufacturing processes of the iron and steel must take place in the United States or a qualifying country, except metallurgical processes involving refinement of steel additives). The cost of iron and steel not produced in the United States or a qualifying country includes but is not limited to the cost of iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings, not produced in the United States or a qualifying country, utilized in the manufacture of the end product and a good faith estimate of the cost of all iron or steel components not produced in the United States or a qualifying country, excluding COTS fasteners. Iron or steel components of unknown origin are treated as foreign. If the end product contains multiple components, the cost of all the materials used in such end product is calculated in accordance with the explanation of cost of components in paragraph (1)(ii)(A) of this definition.</P>
                                <P>
                                    <E T="03">End product</E>
                                     means those articles, materials, and supplies to be acquired under this contract for public use.
                                </P>
                                <P>
                                    <E T="03">Foreign end product</E>
                                     means an end product other than a domestic end product.
                                </P>
                                <P>
                                    <E T="03">Free Trade Agreement country</E>
                                     means Australia, Bahrain, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua, Panama, Peru, or Singapore.
                                </P>
                                <P>
                                    <E T="03">Free Trade Agreement country end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a Free Trade Agreement country; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in a Free Trade Agreement country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Moroccan end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Morocco; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Morocco into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Panamanian end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Panama; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Panama into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Peruvian end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Peru; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Peru into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Predominantly of iron or steel or a combination of both</E>
                                     means that the cost of the iron and steel content exceeds 50 percent of the total cost of all its components. The cost of iron and steel is the cost of the iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings utilized in the manufacture of the product and a good faith estimate of the cost of iron or steel components excluding COTS fasteners.
                                </P>
                                <P>
                                    <E T="03">Qualifying country</E>
                                     means a country with a reciprocal defense procurement memorandum of understanding or international 
                                    <PRTPAGE P="575"/>
                                    agreement with the United States in which both countries agree to remove barriers to purchases of supplies produced in the other country or services performed by sources of the other country, and the memorandum or agreement complies, where applicable, with the requirements of section 36 of the Arms Export Control Act (22 U.S.C. 2776) and with 10 U.S.C. 2457. Accordingly, the following are qualifying countries:
                                </P>
                                <FP SOURCE="FP-1">Australia</FP>
                                <FP SOURCE="FP-1">Austria</FP>
                                <FP SOURCE="FP-1">Belgium</FP>
                                <FP SOURCE="FP-1">Canada</FP>
                                <FP SOURCE="FP-1">Czech Republic</FP>
                                <FP SOURCE="FP-1">Denmark</FP>
                                <FP SOURCE="FP-1">Egypt</FP>
                                <FP SOURCE="FP-1">Estonia</FP>
                                <FP SOURCE="FP-1">Finland</FP>
                                <FP SOURCE="FP-1">France</FP>
                                <FP SOURCE="FP-1">Germany</FP>
                                <FP SOURCE="FP-1">Greece</FP>
                                <FP SOURCE="FP-1">Israel</FP>
                                <FP SOURCE="FP-1">Italy</FP>
                                <FP SOURCE="FP-1">Japan</FP>
                                <FP SOURCE="FP-1">Latvia</FP>
                                <FP SOURCE="FP-1">Lithuania</FP>
                                <FP SOURCE="FP-1">Luxembourg</FP>
                                <FP SOURCE="FP-1">Netherlands</FP>
                                <FP SOURCE="FP-1">Norway</FP>
                                <FP SOURCE="FP-1">Poland</FP>
                                <FP SOURCE="FP-1">Portugal</FP>
                                <FP SOURCE="FP-1">Slovenia</FP>
                                <FP SOURCE="FP-1">Spain</FP>
                                <FP SOURCE="FP-1">Sweden</FP>
                                <FP SOURCE="FP-1">Switzerland</FP>
                                <FP SOURCE="FP-1">Turkey</FP>
                                <FP SOURCE="FP-1">United Kingdom of Great Britain and Northern Ireland.</FP>
                                <P>
                                    <E T="03">Qualifying country component</E>
                                     means a component mined, produced, or manufactured in a qualifying country.
                                </P>
                                <P>
                                    <E T="03">Qualifying country end product</E>
                                     means—
                                </P>
                                <P>(1) An unmanufactured end product mined or produced in a qualifying country; or</P>
                                <P>(2) An end product manufactured in a qualifying country if—</P>
                                <P>(i) The cost of the following types of components exceeds, for the entire period of performance for a contract awarded in: calendar year 2023, 60 percent of the cost of all its components; calendar years 2024 through 2028, 65 percent of the cost of all its components; or calendar year 2029 or later, 75 percent of the cost of all its components:</P>
                                <P>(A) Components mined, produced, or manufactured in a qualifying country.</P>
                                <P>(B) Components mined, produced, or manufactured in the United States.</P>
                                <P>(C) Components of foreign origin of a class or kind for which the Government has determined that sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States. Components of unknown origin are treated as foreign; or</P>
                                <P>(ii) The end product is a COTS item.</P>
                                <P>
                                    <E T="03">South Caucasus/Central and South Asian (SC/CASA) state</E>
                                     means Armenia, Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, Pakistan, Tajikistan, Turkmenistan, or Uzbekistan.
                                </P>
                                <P>
                                    <E T="03">South Caucasus/Central and South Asian (SC/CASA) state end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of an SC/CASA state; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in an SC/CASA state into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Steel</E>
                                     means an alloy that includes at least 50 percent iron, between 0.02 and 2 percent carbon, and may include other elements.
                                </P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>(b) Unless otherwise specified, this clause applies to all items in the Schedule.</P>
                                <P>(c) The Contractor shall deliver under this contract only domestic end products unless, in its offer, it specified delivery of qualifying country end products, SC/CASA state end products, or other foreign end products in the Buy American—Free Trade Agreements—Balance of Payments Program Certificate—Alternate III provision of the solicitation. If the Contractor certified in its offer that it will deliver a qualifying country end product or SC/CASA state end products, the Contractor shall deliver a qualifying country end product, an SC/CASA state end product, or, at the Contractor's option, a domestic end product.</P>
                                <P>(d) The contract price does not include duty for end products or components for which the Contractor will claim duty-free entry.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate X.</E>
                                 As prescribed in 225.1101(10)(i) and (10)(i)(K), use the following clause, which includes, in the definitions of “domestic end product” at paragraph (1)(ii)(A) and “qualifying country end product” at paragraph (2)(i), the domestic content threshold that will apply to the entire contract period of performance; adds “Korean end product” to paragraph (a); and uses a different paragraph (c) than the basic clause:
                            </P>
                            <EXTRACT>
                                <PRTPAGE P="576"/>
                                <HD SOURCE="HD1">Buy American—Free Trade Agreements—Balance of Payments Program—Alternate X (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Bahraini end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Bahrain; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Bahrain into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>Commercially available off-the-shelf (COTS) item—</P>
                                <P>(1) Means any item of supply (including construction material) that is—</P>
                                <P>(i) A commercial product (as defined in paragraph (1) of the definition of “commercial product” in section 2.101 of the Federal Acquisition Regulation (FAR));</P>
                                <P>(ii) Sold in substantial quantities in the commercial marketplace; and</P>
                                <P>(iii) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and</P>
                                <P>(2) Does not include bulk cargo, as defined in 46 U.S.C. 40102(4), such as agricultural products and petroleum products.</P>
                                <P>
                                    <E T="03">Component</E>
                                     means an article, material, or supply incorporated directly into an end product.
                                </P>
                                <P>
                                    <E T="03">Critical component</E>
                                     means a component that is mined, produced, or manufactured in the United States and deemed critical to the U.S. supply chain. The list of critical components is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Critical item</E>
                                     means domestic construction material or a domestic end product that is deemed critical to the U.S. supply chain. The list of critical items is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Domestic end product</E>
                                     means—
                                </P>
                                <P>(1) For an end product that does not consist wholly or predominantly of iron or steel or a combination of both—</P>
                                <P>(i) An unmanufactured end product mined or produced in the United States; or</P>
                                <P>(ii) An end product manufactured in the United States if—</P>
                                <P>(A) The cost of its qualifying country components and its components that are mined, produced, or manufactured in the United States exceeds, for the entire period of performance for a contract awarded in: calendar year 2023, 60 percent of the cost of all its components; calendar years 2024 through 2028, 65 percent of the cost of all its components; or calendar year 2029 or later, 75 percent of the cost of all its components. The cost of components includes transportation costs to the place of incorporation into the end product and U.S. duty (whether or not a duty-free entry certificate is issued). Components of unknown origin are treated as foreign. Scrap generated, collected, and prepared for processing in the United States is considered domestic. A component is considered to have been mined, produced, or manufactured in the United States (regardless of its source in fact) if the end product in which it is incorporated is manufactured in the United States and the component is of a class or kind for which the Government has determined that—</P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) Sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States; or
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) It is inconsistent with the public interest to apply the restrictions of the Buy American statute; or
                                </P>
                                <P>(B) The end product is a COTS item; or</P>
                                <P>(2) For an end product that consists wholly or predominantly of iron or steel or a combination of both, an end product manufactured in the United States, if the cost of iron and steel not produced in the United States or a qualifying country constitutes less than 5 percent of the cost of all the components used in the end product (produced in the United States or a qualifying country means that all manufacturing processes of the iron or steel must take place in the United States or a qualifying country, except metallurgical processes involving refinement of steel additives). The cost of iron and steel not produced in the United States or a qualifying country includes but is not limited to the cost of iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings, not produced in the United States or a qualifying country, utilized in the manufacture of the end product and a good faith estimate of the cost of all iron or steel components not produced in the United States or a qualifying country, excluding COTS fasteners. Iron or steel components of unknown origin are treated as foreign. If the end product contains multiple components, the cost of all the materials used in such end product is calculated in accordance with the explanation of cost of components in paragraph (1)(ii)(A) of this definition.</P>
                                <P>
                                    <E T="03">End product</E>
                                     means those articles, materials, and supplies to be acquired under this contract for public use.
                                </P>
                                <P>
                                    <E T="03">Foreign end product</E>
                                     means an end product other than a domestic end product.
                                </P>
                                <P>
                                    <E T="03">Free Trade Agreement coun</E>
                                    try means Australia, Bahrain, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, 
                                    <PRTPAGE P="577"/>
                                    Morocco, Nicaragua, Panama, Peru, or Singapore.
                                </P>
                                <P>
                                    <E T="03">Free Trade Agreement country end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a Free Trade Agreement country; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in a Free Trade Agreement country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Korean end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Korea; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Korea (Republic of) into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product, includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Moroccan end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Morocco; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Morocco into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Panamanian end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Panama; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Panama into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Peruvian end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Peru; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Peru into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Predominantly of iron or steel or a combination of both</E>
                                     means that the cost of the iron and steel content exceeds 50 percent of the total cost of all its components. The cost of iron and steel is the cost of the iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings utilized in the manufacture of the product and a good faith estimate of the cost of iron or steel components excluding COTS fasteners.
                                </P>
                                <P>
                                    <E T="03">Qualifying country</E>
                                     means a country with a reciprocal defense procurement memorandum of understanding or international agreement with the United States in which both countries agree to remove barriers to purchases of supplies produced in the other country or services performed by sources of the other country, and the memorandum or agreement complies, where applicable, with the requirements of section 36 of the Arms Export Control Act (22 U.S.C. 2776) and with 10 U.S.C. 2457. Accordingly, the following are qualifying countries:
                                </P>
                                <FP SOURCE="FP-1">Australia</FP>
                                <FP SOURCE="FP-1">Austria</FP>
                                <FP SOURCE="FP-1">Belgium</FP>
                                <FP SOURCE="FP-1">Canada</FP>
                                <FP SOURCE="FP-1">Czech Republic</FP>
                                <FP SOURCE="FP-1">Denmark</FP>
                                <FP SOURCE="FP-1">Egypt</FP>
                                <FP SOURCE="FP-1">Estonia</FP>
                                <FP SOURCE="FP-1">Finland</FP>
                                <FP SOURCE="FP-1">France</FP>
                                <FP SOURCE="FP-1">Germany</FP>
                                <FP SOURCE="FP-1">Greece</FP>
                                <FP SOURCE="FP-1">Israel</FP>
                                <FP SOURCE="FP-1">Italy</FP>
                                <FP SOURCE="FP-1">Japan</FP>
                                <FP SOURCE="FP-1">Latvia</FP>
                                <FP SOURCE="FP-1">
                                    Lithuania
                                    <PRTPAGE P="578"/>
                                </FP>
                                <FP SOURCE="FP-1">Luxembourg</FP>
                                <FP SOURCE="FP-1">Netherlands</FP>
                                <FP SOURCE="FP-1">Norway</FP>
                                <FP SOURCE="FP-1">Poland</FP>
                                <FP SOURCE="FP-1">Portugal</FP>
                                <FP SOURCE="FP-1">Slovenia</FP>
                                <FP SOURCE="FP-1">Spain</FP>
                                <FP SOURCE="FP-1">Sweden</FP>
                                <FP SOURCE="FP-1">Switzerland</FP>
                                <FP SOURCE="FP-1">Turkey</FP>
                                <FP SOURCE="FP-1">United Kingdom of Great Britain and Northern Ireland.</FP>
                                <P>
                                    <E T="03">Qualifying country component</E>
                                     means a component mined, produced, or manufactured in a qualifying country.
                                </P>
                                <P>
                                    <E T="03">Qualifying country end product</E>
                                     means—
                                </P>
                                <P>(1) An unmanufactured end product mined or produced in a qualifying country; or</P>
                                <P>(2) An end product manufactured in a qualifying country if—</P>
                                <P>(i) The cost of the following types of components exceeds, for the entire period of performance for a contract awarded in: calendar year 2023, 60 percent of the cost of all its components; calendar years 2024 through 2028, 65 percent of the cost of all its components; or calendar year 2029 or later, 75 percent of the cost of all its components:</P>
                                <P>(A) Components mined, produced, or manufactured in a qualifying country.</P>
                                <P>(B) Components mined, produced, or manufactured in the United States.</P>
                                <P>(C) Components of foreign origin of a class or kind for which the Government has determined that sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States. Components of unknown origin are treated as foreign; or</P>
                                <P>(ii) The end product is a COTS item.</P>
                                <P>
                                    <E T="03">Steel</E>
                                     means an alloy that includes at least 50 percent iron, between 0.02 and 2 percent carbon, and may include other elements.
                                </P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>(b) Unless otherwise specified, this clause applies to all items in the Schedule.</P>
                                <P>(c) The Contractor shall deliver under this contract only domestic end products unless, in its offer, it specified delivery of qualifying country end products, Free Trade Agreement country end products other than Bahraini end products, Korean end products, Moroccan end products, Panamanian end products, or Peruvian end products, or other foreign end products in the Buy American—Free Trade Agreements—Balance of Payments Program Certificate—Alternate IV provision of the solicitation. If the Contractor certified in its offer that it will deliver a qualifying country end product or a Free Trade Agreement country end product other than a Bahraini end product, a Korean end product, a Moroccan end product, a Panamanian end product, or a Peruvian end product, the Contractor shall deliver a qualifying country end product, a Free Trade Agreement country end product other than a Bahraini end product, a Korean end product, a Moroccan end product, a Panamanian end product, or a Peruvian end product, or, at the Contractor's option, a domestic end product.</P>
                                <P>(d) The contract price does not include duty for end products or components for which the Contractor will claim duty-free entry.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate XI.</E>
                                 As prescribed in 225.1101(10)(i) and (10)(i)(L), use the following clause, which includes, in the definitions of “domestic end product” at paragraph (1)(ii)(A) and “qualifying country end product” at paragraph (2)(i), the domestic content threshold that will apply to the entire contract period of performance; adds “Korean end product,” “South Caucasus/Central and South Asian (SC/CASA) state,” and “South Caucasus/Central and South Asian (SC/CASA) state end product” to paragraph (a); and uses a different paragraph (c) than the basic clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Buy American—Free Trade Agreements—Balance of Payments Program—Alternate XI (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Bahraini end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Bahrain; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Bahrain into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Commercially available off-the-shelf (COTS) item</E>
                                    —
                                </P>
                                <P>(1) Means any item of supply (including construction material) that is—</P>
                                <P>(i) A commercial product (as defined in paragraph (1) of the definition of “commercial product” in section 2.101 of the Federal Acquisition Regulation (FAR));</P>
                                <P>(ii) Sold in substantial quantities in the commercial marketplace; and</P>
                                <P>
                                    (iii) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and
                                    <PRTPAGE P="579"/>
                                </P>
                                <P>(2) Does not include bulk cargo, as defined in 46 U.S.C. 40102(4), such as agricultural products and petroleum products.</P>
                                <P>
                                    <E T="03">Component</E>
                                     means an article, material, or supply incorporated directly into an end product.
                                </P>
                                <P>
                                    <E T="03">Critical component</E>
                                     means a component that is mined, produced, or manufactured in the United States and deemed critical to the U.S. supply chain. The list of critical components is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Critical item</E>
                                     means domestic construction material or a domestic end product that is deemed critical to the U.S. supply chain. The list of critical items is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Domestic end product</E>
                                     means—
                                </P>
                                <P>(1) For an end product that does not consist wholly or predominantly of iron or steel or a combination of both—</P>
                                <P>(i) An unmanufactured end product mined or produced in the United States; or</P>
                                <P>(ii) An end product manufactured in the United States if—</P>
                                <P>(A) The cost of its qualifying country components and its components that are mined, produced, or manufactured in the United States exceeds, for the entire period of performance for a contract awarded in: calendar year 2023, 60 percent of the cost of all its components; calendar years 2024 through 2028, 65 percent of the cost of all its components; or calendar year 2029 or later, 75 percent of the cost of all its components. The cost of components includes transportation costs to the place of incorporation into the end product and U.S. duty (whether or not a duty-free entry certificate is issued). Components of unknown origin are treated as foreign. Scrap generated, collected, and prepared for processing in the United States is considered domestic. A component is considered to have been mined, produced, or manufactured in the United States (regardless of its source in fact) if the end product in which it is incorporated is manufactured in the United States and the component is of a class or kind for which the Government has determined that—</P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) Sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States; or
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) It is inconsistent with the public interest to apply the restrictions of the Buy American statute; or
                                </P>
                                <P>(B) The end product is a COTS item; or</P>
                                <P>(2) For an end product that consists wholly or predominantly of iron or steel or a combination of both, an end product manufactured in the United States, if the cost of iron and steel not produced in the United States or a qualifying country constitutes less than 5 percent of the cost of all the components used in the end product (produced in the United States or a qualifying country means that all manufacturing processes of the iron or steel must take place in the United States or a qualifying country, except metallurgical processes involving refinement of steel additives). The cost of iron and steel not produced in the United States or a qualifying country includes but is not limited to the cost of iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings, not produced in the United States or a qualifying country, utilized in the manufacture of the end product and a good faith estimate of the cost of all iron or steel components not produced in the United States or a qualifying country, excluding COTS fasteners. Iron or steel components of unknown origin are treated as foreign. If the end product contains multiple components, the cost of all the materials used in such end product is calculated in accordance with the explanation of cost of components in paragraph (1)(ii)(A) of this definition.</P>
                                <P>
                                    <E T="03">End product</E>
                                     means those articles, materials, and supplies to be acquired under this contract for public use.
                                </P>
                                <P>
                                    <E T="03">Foreign end product</E>
                                     means an end product other than a domestic end product.
                                </P>
                                <P>
                                    <E T="03">Free Trade Agreement country</E>
                                     means Australia, Bahrain, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua, Panama, Peru, or Singapore.
                                </P>
                                <P>
                                    <E T="03">Free Trade Agreement country end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a Free Trade Agreement country; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in a Free Trade Agreement country into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Korean end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Korea; or</P>
                                <P>
                                    (2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Korea (Republic of) into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end 
                                    <PRTPAGE P="580"/>
                                    product, includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.
                                </P>
                                <P>
                                    <E T="03">Moroccan end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Morocco; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Morocco into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Panamanian end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Panama; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Panama into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Peruvian end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Peru; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in Peru into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Predominantly of iron or steel or a combination of both</E>
                                     means that the cost of the iron and steel content exceeds 50 percent of the total cost of all its components. The cost of iron and steel is the cost of the iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings utilized in the manufacture of the product and a good faith estimate of the cost of iron or steel components excluding COTS fasteners.
                                </P>
                                <P>
                                    <E T="03">Qualifying country</E>
                                     means a country with a reciprocal defense procurement memorandum of understanding or international agreement with the United States in which both countries agree to remove barriers to purchases of supplies produced in the other country or services performed by sources of the other country, and the memorandum or agreement complies, where applicable, with the requirements of section 36 of the Arms Export Control Act (22 U.S.C. 2776) and with 10 U.S.C. 2457. Accordingly, the following are qualifying countries:
                                </P>
                                <FP SOURCE="FP-1">Australia</FP>
                                <FP SOURCE="FP-1">Austria</FP>
                                <FP SOURCE="FP-1">Belgium</FP>
                                <FP SOURCE="FP-1">Canada</FP>
                                <FP SOURCE="FP-1">Czech Republic</FP>
                                <FP SOURCE="FP-1">Denmark</FP>
                                <FP SOURCE="FP-1">Egypt</FP>
                                <FP SOURCE="FP-1">Estonia</FP>
                                <FP SOURCE="FP-1">Finland</FP>
                                <FP SOURCE="FP-1">France</FP>
                                <FP SOURCE="FP-1">Germany</FP>
                                <FP SOURCE="FP-1">Greece</FP>
                                <FP SOURCE="FP-1">Israel</FP>
                                <FP SOURCE="FP-1">Italy</FP>
                                <FP SOURCE="FP-1">Japan</FP>
                                <FP SOURCE="FP-1">Latvia</FP>
                                <FP SOURCE="FP-1">Lithuania</FP>
                                <FP SOURCE="FP-1">Luxembourg</FP>
                                <FP SOURCE="FP-1">Netherlands</FP>
                                <FP SOURCE="FP-1">Norway</FP>
                                <FP SOURCE="FP-1">Poland</FP>
                                <FP SOURCE="FP-1">Portugal</FP>
                                <FP SOURCE="FP-1">Slovenia</FP>
                                <FP SOURCE="FP-1">Spain</FP>
                                <FP SOURCE="FP-1">Sweden</FP>
                                <FP SOURCE="FP-1">Switzerland</FP>
                                <FP SOURCE="FP-1">Turkey</FP>
                                <FP SOURCE="FP-1">United Kingdom of Great Britain and Northern Ireland.</FP>
                                <P>
                                    <E T="03">Qualifying country component</E>
                                     means a component mined, produced, or manufactured in a qualifying country.
                                </P>
                                <P>
                                    <E T="03">Qualifying country end product</E>
                                     means—
                                </P>
                                <P>(1) An unmanufactured end product mined or produced in a qualifying country; or</P>
                                <P>(2) An end product manufactured in a qualifying country if—</P>
                                <P>(i) The cost of the following types of components exceeds, for the entire period of performance for a contract awarded in: calendar year 2023, 60 percent of the cost of all its components; calendar years 2024 through 2028, 65 percent of the cost of all its components; or calendar year 2029 or later, 75 percent of the cost of all its components:</P>
                                <P>(A) Components mined, produced, or manufactured in a qualifying country.</P>
                                <P>
                                    (B) Components mined, produced, or manufactured in the United States.
                                    <PRTPAGE P="581"/>
                                </P>
                                <P>(C) Components of foreign origin of a class or kind for which the Government has determined that sufficient and reasonably available commercial quantities of a satisfactory quality are not mined, produced, or manufactured in the United States. Components of unknown origin are treated as foreign; or</P>
                                <P>(ii) The end product is a COTS item.</P>
                                <P>
                                    <E T="03">South Caucasus/Central and South Asian (SC/CASA) state</E>
                                     means Armenia, Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, Pakistan, Tajikistan, Turkmenistan, or Uzbekistan.
                                </P>
                                <P>
                                    <E T="03">South Caucasus/Central and South Asian (SC/CASA) state end product</E>
                                     means an article that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of an SC/CASA state; or</P>
                                <P>(2) In the case of an article that consists in whole or in part of materials from another country, has been substantially transformed in an SC/CASA state into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was transformed. The term refers to a product offered for purchase under a supply contract, but for purposes of calculating the value of the end product, includes services (except transportation services) incidental to its supply, provided that the value of those incidental services does not exceed the value of the product itself.</P>
                                <P>
                                    <E T="03">Steel</E>
                                     means an alloy that includes at least 50 percent iron, between 0.02 and 2 percent carbon, and may include other elements.
                                </P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>(b) Unless otherwise specified, this clause applies to all items in the Schedule.</P>
                                <P>(c) The Contractor shall deliver under this contract only domestic end products unless, in its offer, it specified delivery of qualifying country end products, SC/CASA state end products, Free Trade Agreement country end products other than Bahraini end products, Korean end products, Moroccan end products, Panamanian end products, or Peruvian end products, or other foreign end products in the Buy American—Free Trade Agreements—Balance of Payments Program Certificate—Alternate V provision of the solicitation. If the Contractor certified in its offer that it will deliver a qualifying country end product, SC/CASA state end products, or a Free Trade Agreement country end product other than a Bahraini end product, a Korean end product, a Moroccan end product, a Panamanian end product, or a Peruvian end product, the Contractor shall deliver a qualifying country end product, an SC/CASA state end product, a Free Trade Agreement country end product other than a Bahraini end product, a Korean end product, a Moroccan end product, a Panamanian end product, or a Peruvian end product or, at the Contractor's option, a domestic end product.</P>
                                <P>(d) The contract price does not include duty for end products or components for which the Contractor will claim duty-free entry.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[89 FR 11966, Feb. 15, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7037—252.225-7038</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7039</SECTNO>
                            <SUBJECT>Defense Contractors Performing Private Security Functions Outside the United States.</SUBJECT>
                            <P>As prescribed in 225.302-6, insert the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Defense Contractors Performing Private Security Functions Outside the United States (JAN 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Full cooperation</E>
                                    —(1) Means disclosure to the Government of the information sufficient to identify the nature and extent of the incident and the individuals responsible for the conduct. It includes providing timely and complete response to Government auditors' and investigators' requests for documents and access to employees with information;
                                </P>
                                <P>(2) Does not foreclose any contractor rights arising in law, the FAR or the terms of the contract. It does not require—</P>
                                <P>(i) The contractor to waive its attorney-client privilege or the protections afforded by the attorney work product doctrine; or</P>
                                <P>(ii) Any officer, director, owner, or employee of the contractor, including a sole proprietor, to waive his or her attorney-client privilege or Fifth Amendment rights; and</P>
                                <P>(3) Does not restrict the contractor from—</P>
                                <P>(i) Conducting an internal investigation; or</P>
                                <P>(ii) Defending a proceeding or dispute arising under the contract or related to a potential or disclosed violation.</P>
                                <P>
                                    <E T="03">Private security functions</E>
                                     means the following activities engaged in by a contractor:
                                </P>
                                <P>(1) Guarding of personnel, facilities, designated sites or property of a Federal agency, the contractor or subcontractor, or a third party.</P>
                                <P>(2) Any other activity for which personnel are required to carry weapons in the performance of their duties in accordance with the terms of this contract.</P>
                                <P>
                                    (b) 
                                    <E T="03">Applicability.</E>
                                     If this contract is performed both in a designated area and in an area that is not designated, the clause only applies to performance in the designated area. Designated areas are areas outside the United States of—
                                </P>
                                <P>(1) Contingency operations;</P>
                                <P>(2) Combat operations, as designated by the Secretary of Defense;</P>
                                <P>
                                    (3) Other significant military operations (as defined in 32 CFR part 159), designated by the Secretary of Defense upon agreement of the Secretary of State;
                                    <PRTPAGE P="582"/>
                                </P>
                                <P>(4) Peace operations, consistent with Joint Publication 3-07.3; or</P>
                                <P>(5) Other military operations or military exercises, when designated by the Combatant Commander.</P>
                                <P>
                                    (c) 
                                    <E T="03">Requirements.</E>
                                     The Contractor shall—
                                </P>
                                <P>(1) Ensure that all Contractor personnel who are responsible for performing private security functions under this contract comply with 32 CFR part 159 and any orders, directives, or instructions to contractors performing private security functions that are identified in the contract for—</P>
                                <P>(i) Registering, processing, accounting for, managing, overseeing and keeping appropriate records of personnel performing private security functions;</P>
                                <P>(ii) Authorizing, accounting for and registering in Synchronized Predeployment and Operational Tracker (SPOT), weapons to be carried by or available to be used by personnel performing private security functions;</P>
                                <P>(iii) Identifying and registering in SPOT armored vehicles, helicopters and other military vehicles operated by Contractors performing private security functions; and</P>
                                <P>(iv) In accordance with orders and instructions established by the applicable Combatant Commander, reporting incidents in which—</P>
                                <P>(A) A weapon is discharged by personnel performing private security functions;</P>
                                <P>(B) Personnel performing private security functions are attacked, killed, or injured;</P>
                                <P>(C) Persons are killed or injured or property is destroyed as a result of conduct by Contractor personnel;</P>
                                <P>(D) A weapon is discharged against personnel performing private security functions or personnel performing such functions believe a weapon was so discharged; or</P>
                                <P>(E) Active, non-lethal countermeasures (other than the discharge of a weapon) are employed by personnel performing private security functions in response to a perceived immediate threat;</P>
                                <P>(2) Ensure that Contractor personnel who are responsible for performing private security functions under this contract are briefed on and understand their obligation to comply with—</P>
                                <P>(i) Qualification, training, screening (including, if applicable, thorough background checks) and security requirements established by 32 CFR part 159;</P>
                                <P>(ii) Applicable laws and regulations of the United States and the host country and applicable treaties and international agreements regarding performance of private security functions;</P>
                                <P>(iii) Orders, directives, and instructions issued by the applicable Combatant Commander or relevant Chief of Mission relating to weapons, equipment, force protection, security, health, safety, or relations and interaction with locals; and</P>
                                <P>(iv) Rules on the use of force issued by the applicable Combatant Commander or relevant Chief of Mission for personnel performing private security functions;</P>
                                <P>(3) Provide full cooperation with any Government-authorized investigation of incidents reported pursuant to paragraph (c)(1)(iv) of this clause and incidents of alleged misconduct by personnel performing private security functions under this contract by providing—</P>
                                <P>(i) Access to employees performing private security functions; and</P>
                                <P>(ii) Relevant information in the possession of the Contractor regarding the incident concerned; and</P>
                                <P>
                                    (4) Comply with ANSI/ASIS PSC.1-2012, American National Standard, Management System for Quality of Private Security Company Operations—Requirements with Guidance or the International Standard ISO 18788, Management System for Private Security Operations—Requirements with Guidance (located at 
                                    <E T="03">http://www.acq.osd.mil/log/PS/psc.html</E>
                                    ).
                                </P>
                                <P>
                                    (d) 
                                    <E T="03">Remedies.</E>
                                     In addition to other remedies available to the Government—
                                </P>
                                <P>(1) The Contracting Officer may direct the Contractor, at its own expense, to remove and replace any Contractor or subcontractor personnel performing private security functions who fail to comply with or violate applicable requirements of this clause or 32 CFR part 159. Such action may be taken at the Government's discretion without prejudice to its rights under any other provision of this contract;</P>
                                <P>(2) The Contractor's failure to comply with the requirements of this clause will be included in appropriate databases of past performance and considered in any responsibility determination or evaluation of past performance; and</P>
                                <P>(3) If this is an award-fee contract, the Contractor's failure to comply with the requirements of this clause shall be considered in the evaluation of the Contractor's performance during the relevant evaluation period, and the Contracting Officer may treat such failure to comply as a basis for reducing or denying award fees for such period or for recovering all or part of award fees previously paid for such period.</P>
                                <P>
                                    (e) 
                                    <E T="03">Rule of construction.</E>
                                     The duty of the Contractor to comply with the requirements of this clause shall not be reduced or diminished by the failure of a higher- or lower-tier Contractor or subcontractor to comply with the clause requirements or by a failure of the contracting activity to provide required oversight.
                                </P>
                                <P>
                                    (f) 
                                    <E T="03">Subcontracts.</E>
                                     The Contractor shall include the substance of this clause, including this paragraph (f), in subcontracts, including subcontracts for commercial products or commercial services, when private security 
                                    <PRTPAGE P="583"/>
                                    functions will be performed outside the United States in areas of—
                                </P>
                                <P>(1) Contingency operations;</P>
                                <P>(2) Combat operations, as designated by the Secretary of Defense;</P>
                                <P>(3) Other significant military operations (as defined in 32 CFR part 159), designated by the Secretary of Defense upon agreement of the Secretary of State;</P>
                                <P>(4) Peace operations, consistent with Joint Publication 3-07.3; or</P>
                                <P>(5) Other military operations or military exercises, when designated by the Combatant Commander.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[80 FR 4999, Jan. 29, 2015, as amended at 81 FR 42560, June 30, 2016; 88 FR 6592, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7040</SECTNO>
                            <SUBJECT>Contractor Personnel Supporting U.S. Armed Forces Deployed Outside the United States.</SUBJECT>
                            <P>As prescribed in 225.371-5(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Contractor Personnel Supporting U.S. Armed Forces Deployed Outside the United States (OCT 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Combatant Commander</E>
                                     means the commander of a unified or specified combatant command established in accordance with 10 U.S.C. 161.
                                </P>
                                <P>
                                    <E T="03">Contractors authorized to accompany the Force,</E>
                                     or 
                                    <E T="03">CAAF,</E>
                                     means contractor personnel, including all tiers of subcontractor personnel, who are authorized to accompany U.S. Armed Forces in applicable operations and have been afforded CAAF status through a letter of authorization. CAAF generally include all U.S. citizen and third-country national employees not normally residing within the operational area whose area of performance is in the direct vicinity of U.S. Armed Forces and who routinely are collocated with the U.S. Armed Forces (especially in non-permissive environments). Personnel collocated with U.S. Armed Forces shall be afforded CAAF status through a letter of authorization. In some cases, Combatant Commander subordinate commanders may designate mission-essential host nation or local national contractor employees (e.g., interpreters) as CAAF. CAAF includes contractors previously identified as contractors deploying with the U.S. Armed Forces. CAAF status does not apply to contractor personnel in support of applicable operations within the boundaries and territories of the United States.
                                </P>
                                <P>
                                    <E T="03">Designated operational area</E>
                                     means a geographic area designated by the combatant commander or subordinate joint force commander for the conduct or support of specified military operations.
                                </P>
                                <P>
                                    <E T="03">Designated reception site</E>
                                     means the designated place for the reception, staging, integration, and onward movement of contractors deploying during a contingency. The designated reception site includes assigned joint reception centers and other Service or private reception sites.
                                </P>
                                <P>
                                    <E T="03">Law of war</E>
                                     means that part of international law that regulates the conduct of armed hostilities. The law of war encompasses all international law for the conduct of hostilities binding on the United States or its individual citizens, including treaties and international agreements to which the United States is a party, and applicable customary international law.
                                </P>
                                <P>
                                    <E T="03">Non-CAAF</E>
                                     means personnel who are not designated as CAAF, such as local national (LN) employees and non-LN employees who are permanent residents in the operational area or third-country nationals not routinely residing with U.S. Armed Forces (and third-country national expatriates who are permanent residents in the operational area) who perform support functions away from the close proximity of, and do not reside with, U.S. Armed Forces. Government-furnished support to non-CAAF is typically limited to force protection, emergency medical care, and basic human needs (e.g., bottled water, latrine facilities, security, and food when necessary) when performing their jobs in the direct vicinity of U.S. Armed Forces. Non-CAAF status does not apply to contractor personnel in support of applicable operations within the boundaries and territories of the United States.
                                </P>
                                <P>
                                    <E T="03">Subordinate joint force commander</E>
                                     means a sub-unified commander or joint task force commander.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">General.</E>
                                     (1) This clause applies to both CAAF and non-CAAF when performing in a designated operational area outside the United States to support U.S. Armed Forces deployed outside the United States in—
                                </P>
                                <P>(i) Contingency operations;</P>
                                <P>(ii) Peace operations, consistent with Joint Publication 3-07.3; or</P>
                                <P>(iii) Other military operations or military exercises, when designated by the Combatant Commander or as directed by the Secretary of Defense.</P>
                                <P>(2) Contract performance in support of U.S. Armed Forces deployed outside the United States may require work in dangerous or austere conditions. Except as otherwise provided in the contract, the Contractor accepts the risks associated with required contract performance in such operations.</P>
                                <P>
                                    (3) When authorized in accordance with paragraph (j) of this clause to carry arms for personal protection, Contractor personnel are only authorized to use force for individual self-defense.
                                    <PRTPAGE P="584"/>
                                </P>
                                <P>(4) Unless immune from host nation jurisdiction by virtue of an international agreement or international law, inappropriate use of force by contractor personnel supporting the U.S. Armed Forces can subject such personnel to United States or host nation prosecution and civil liability (see paragraphs (d) and (j)(3) of this clause).</P>
                                <P>(5) Service performed by Contractor personnel subject to this clause is not active duty or service under 38 U.S.C. 106 note.</P>
                                <P>
                                    (c) 
                                    <E T="03">Support.</E>
                                     (1)(i) The Combatant Commander will develop a security plan for protection of Contractor personnel in locations where there is not sufficient or legitimate civil authority, when the Combatant Commander decides it is in the interests of the Government to provide security because—
                                </P>
                                <P>(A) The Contractor cannot obtain effective security services;</P>
                                <P>(B) Effective security services are unavailable at a reasonable cost; or</P>
                                <P>(C) Threat conditions necessitate security through military means.</P>
                                <P>(ii) In appropriate cases, the Combatant Commander may provide security through military means, commensurate with the level of security provided DoD civilians.</P>
                                <P>(2)(i) Generally, CAAF will be afforded emergency medical and dental care if injured while supporting applicable operations. Additionally, non-CAAF employees who are injured while in the vicinity of U.S. Armed Forces will normally receive emergency medical and dental care. Emergency medical and dental care includes medical care situations in which life, limb, or eyesight is jeopardized. Examples of emergency medical and dental care include examination and initial treatment of victims of sexual assault; refills of prescriptions for life-dependent drugs; repair of broken bones, lacerations, infections; and traumatic injuries to the dentition. Hospitalization will be limited to stabilization and short-term medical treatment with an emphasis on return to duty or placement in the patient movement system.</P>
                                <P>(ii) When the Government provides medical treatment or transportation of Contractor personnel to a selected civilian facility, the Contractor shall ensure that the Government is reimbursed for any costs associated with such treatment or transportation.</P>
                                <P>(iii) Medical or dental care beyond this standard is not authorized.</P>
                                <P>(3) Contractor personnel must have a Synchronized Predeployment and Operational Tracker (SPOT)-generated letter of authorization signed by the Contracting Officer in order to process through a deployment center or to travel to, from, or within the designated operational area. The letter of authorization also will identify any additional authorizations, privileges, or Government support that Contractor personnel are entitled to under this contract. Contractor personnel who are issued a letter of authorization shall carry it with them at all times while deployed.</P>
                                <P>(4) Unless specified elsewhere in this contract, the Contractor is responsible for all other support required for its personnel engaged in the designated operational area under this contract.</P>
                                <P>
                                    (d) 
                                    <E T="03">Compliance with laws and regulations.</E>
                                     (1) The Contractor shall comply with, and shall ensure that its personnel supporting U.S. Armed Forces deployed outside the United States as specified in paragraph (b)(1) of this clause are familiar with and comply with, all applicable—
                                </P>
                                <P>(i) United States, host country, and third country national laws;</P>
                                <P>(ii) Provisions of the law of war, as well as any other applicable treaties and international agreements;</P>
                                <P>(iii) United States regulations, directives, instructions, policies, and procedures; and</P>
                                <P>(iv) Orders, directives, and instructions issued by the Combatant Commander, including those relating to force protection, security, health, safety, or relations and interaction with local nationals.</P>
                                <P>(2) The Contractor shall institute and implement an effective program to prevent violations of the law of war by its employees and subcontractors, including law of war training in accordance with paragraph (e)(1)(vii) of this clause.</P>
                                <P>(3) The Contractor shall ensure that CAAF and non-CAAF are aware—</P>
                                <P>(i) Of the DoD definition of “sexual assault” in DoDD Directive 6495.01, Sexual Assault Prevention and Response Program;</P>
                                <P>(ii) That many of the offenses addressed by the definition are covered under the Uniform Code of Military Justice (see paragraph (e)(2)(iv) of this clause). Other sexual misconduct may constitute offenses under the Uniform Code of Military Justice, Federal law, such as the Military Extraterritorial Jurisdiction Act, or host nation laws;</P>
                                <P>(iii) That the offenses not covered by the Uniform Code of Military Justice may nevertheless have consequences to the contractor employees (see paragraph (h)(1) of this clause).</P>
                                <P>(4) The Contractor shall report to the appropriate investigative authorities, identified in paragraph (d)(6) of this clause, any alleged offenses under—</P>
                                <P>(i) The Uniform Code of Military Justice (chapter 47 of title 10, United States Code) (applicable to contractors serving with or accompanying an armed force in the field during a declared war or contingency operations); or</P>
                                <P>(ii) The Military Extraterritorial Jurisdiction Act (chapter 212 of title 18, United States Code).</P>
                                <P>
                                    (5) The Contractor shall provide to all contractor personnel who will perform work on 
                                    <PRTPAGE P="585"/>
                                    a contract in the deployed area, before beginning such work, information on the following:
                                </P>
                                <P>(i) How and where to report an alleged crime described in paragraph (d)(4) of this clause.</P>
                                <P>(ii) Where to seek victim and witness protection and assistance available to contractor personnel in connection with an alleged offense described in paragraph (d)(4) of this clause.</P>
                                <P>(iii) That this section does not create any rights or privileges that are not authorized by law or DoD policy.</P>
                                <P>(6) The appropriate investigative authorities to which suspected crimes shall be reported include the following—</P>
                                <P>
                                    (i) US Army Criminal Investigation Command at 
                                    <E T="03">http://www.cid.army.mil/reportacrime.html;</E>
                                </P>
                                <P>
                                    (ii) Air Force Office of Special Investigations at 
                                    <E T="03">http://www.osi.andrews.af.mil/library/factsheets/factsheet.asp?id=14522;</E>
                                </P>
                                <P>
                                    (iii) Navy Criminal Investigative Service at 
                                    <E T="03">http://www.ncis.navy.mil/Pages/publicdefault.aspx;</E>
                                </P>
                                <P>
                                    (iv) Defense Criminal Investigative Service at 
                                    <E T="03">http://www.dodig.mil/HOTLINE/index.html;</E>
                                </P>
                                <P>(v) To any command of any supported military element or the command of any base.</P>
                                <P>
                                    (7) Personnel seeking whistleblower protection from reprisals for reporting criminal acts shall seek guidance through the DoD Inspector General hotline at 800-424-9098 or 
                                    <E T="03">www.dodig.mil/HOTLINE/index.html.</E>
                                     Personnel seeking other forms of victim or witness protections should contact the nearest military law enforcement office.
                                </P>
                                <P>(8)(i) The Contractor shall ensure that Contractor employees supporting the U.S. Armed Forces are aware of their rights to—</P>
                                <P>(A) Hold their own identity or immigration documents, such as passport or driver's license, regardless of the documents' issuing authority;</P>
                                <P>(B) Receive agreed upon wages on time;</P>
                                <P>(C) Take lunch and work-breaks;</P>
                                <P>(D) Elect to terminate employment at any time;</P>
                                <P>(E) Identify grievances without fear of reprisal;</P>
                                <P>(F) Have a copy of their employment contract in a language they understand;</P>
                                <P>(G) Receive wages that are not below the legal host-country minimum wage;</P>
                                <P>(H) Be notified of their rights, wages, and prohibited activities prior to signing their employment contract; and</P>
                                <P>(I) If housing is provided, live in housing that meets host-country housing and safety standards.</P>
                                <P>(ii) The Contractor shall post these rights in employee work spaces in English and in any foreign language(s) spoken by a significant portion of the workforce.</P>
                                <P>(iii) The Contractor shall enforce the rights of Contractor personnel supporting the U.S. Armed Forces.</P>
                                <P>
                                    (e) 
                                    <E T="03">Preliminary personnel requirements.</E>
                                     (1) The Contractor shall ensure that the following requirements are met prior to deploying CAAF (specific requirements for each category will be specified in the statement of work or elsewhere in the contract):
                                </P>
                                <P>(i) All required security and background checks are complete and acceptable.</P>
                                <P>(ii) All CAAF deploying in support of an applicable operation—</P>
                                <P>(A) Are medically, dentally, and psychologically fit for deployment and performance of their contracted duties;</P>
                                <P>(B) Meet the minimum medical screening requirements, including theater-specific medical qualifications as established by the geographic Combatant Commander (as posted to the Geographic Combatant Commander's Web site or other venue); and</P>
                                <P>(C) Have received all required immunizations as specified in the contract.</P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) During predeployment processing, the Government will provide, at no cost to the Contractor, any military-specific immunizations and/or medications not available to the general public.
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) All other immunizations shall be obtained prior to arrival at the deployment center.
                                </P>
                                <P>
                                    (
                                    <E T="03">3</E>
                                    ) All CAAF and selected non-CAAF, as specified in the statement of work, shall bring to the designated operational area a copy of the U.S. Centers for Disease Control and Prevention (CDC) Form 731, International Certificate of Vaccination or Prophylaxis as Approved by the World Health Organization, (also known as “shot record” or “Yellow Card”) that shows vaccinations are current.
                                </P>
                                <P>(iii) Deploying personnel have all necessary passports, visas, and other documents required to enter and exit a designated operational area and have a Geneva Conventions identification card, or other appropriate DoD identity credential, from the deployment center.</P>
                                <P>(iv) Special area, country, and theater clearance is obtained for all personnel deploying. Clearance requirements are inDoD Directive 4500.54E, DoD Foreign Clearance Program. For this purpose, CAAF are considered non-DoD contractor personnel traveling under DoD sponsorship.</P>
                                <P>(v) All deploying personnel have received personal security training. At a minimum, the training shall—</P>
                                <P>(A) Cover safety and security issues facing employees overseas;</P>
                                <P>(B) Identify safety and security contingency planning activities; and</P>
                                <P>
                                    (C) Identify ways to utilize safety and security personnel and other resources appropriately.
                                    <PRTPAGE P="586"/>
                                </P>
                                <P>(vi) All personnel have received isolated personnel training, if specified in the contract, in accordance with DoD Instruction 1300.23, Isolated Personnel Training for DoD Civilian and Contractors.</P>
                                <P>(vii) Personnel have received law of war training as follows:</P>
                                <P>(A) Basic training is required for all CAAF deployed outside the United States. The basic training will be provided through—</P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) A military-run training center; or
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) A web-based source, if specified in the contract or approved by the Contracting Officer.
                                </P>
                                <P>(B) Advanced training, commensurate with their duties and responsibilities, may be required for some Contractor personnel as specified in the contract.</P>
                                <P>(2) The Contractor shall notify all personnel who are not a host country national, or who are not ordinarily resident in the host country, that—</P>
                                <P>
                                    (i) Such employees, and dependents residing with such employees, who engage in conduct outside the United States that would constitute an offense punishable by imprisonment for more than one year if the conduct had been engaged in within the special maritime and territorial jurisdiction of the United States, may potentially be subject to the criminal jurisdiction of the United States in accordance with the Military Extraterritorial Jurisdiction Act of 2000 (18 U.S.C. 3621, 
                                    <E T="03">et seq.</E>
                                    );
                                </P>
                                <P>(ii) Pursuant to the War Crimes Act (18 U.S.C. 2441), Federal criminal jurisdiction also extends to conduct that is determined to constitute a war crime when committed by a civilian national of the United States;</P>
                                <P>(iii) Other laws may provide for prosecution of U.S. nationals who commit offenses on the premises of U.S. diplomatic, consular, military or other U.S. Government missions outside the United States (18 U.S.C. 7(9)); and</P>
                                <P>(iv) In time of declared war or a contingency operation, CAAF are subject to the jurisdiction of the Uniform Code of Military Justice under 10 U.S.C. 802(a)(10).</P>
                                <P>(v) Such employees are required to report offenses alleged to have been committed by or against Contractor personnel to appropriate investigative authorities.</P>
                                <P>(vi) Such employees will be provided victim and witness protection and assistance.</P>
                                <P>
                                    (f) 
                                    <E T="03">Processing and departure points.</E>
                                     CAAF shall—
                                </P>
                                <P>(1) Process through the deployment center designated in the contract, or as otherwise directed by the Contracting Officer, prior to deploying. The deployment center will conduct deployment processing to ensure visibility and accountability of Contractor personnel and to ensure that all deployment requirements are met, including the requirements specified in paragraph (e)(1) of this clause;</P>
                                <P>(2) Use the point of departure and transportation mode directed by the Contracting Officer; and</P>
                                <P>(3) Process through a designated reception site (DRS) upon arrival at the deployed location. The DRS will validate personnel accountability, ensure that specific designated operational area entrance requirements are met, and brief Contractor personnel on theater-specific policies and procedures.</P>
                                <P>
                                    (g) 
                                    <E T="03">Personnel data.</E>
                                     (1) The Contractor shall use the Synchronized Predeployment and Operational Tracker (SPOT) web-based system, to enter and maintain the data for all CAAF and, as designated by the Under Secretary of Defense (Acquisition and Sustainment) or the Combatant Commander, non-CAAF supporting U.S. Armed Forces deployed outside the United States as specified in paragraph (b)(1) of this clause.
                                </P>
                                <P>
                                    (2) The Contractor shall enter the required information about their contractor personnel prior to deployment and shall continue to use the SPOT web-based system at 
                                    <E T="03">https://spot.dmdc.mil</E>
                                     to maintain accurate, up-to-date information throughout the deployment for all Contractor personnel. Changes to status of individual Contractor personnel relating to their in-theater arrival date and their duty location, to include closing out the deployment with their proper status (e.g., mission complete, killed, wounded) shall be annotated within the SPOT database in accordance with the timelines established in the SPOT Business Rules at 
                                    <E T="03">http://www.acq.osd.mil/log/PS/ctr_mgt_accountability.html</E>
                                    .
                                </P>
                                <P>
                                    (h) 
                                    <E T="03">Contractor personnel.</E>
                                     (1) The Contracting Officer may direct the Contractor, at its own expense, to remove and replace any Contractor personnel who jeopardize or interfere with mission accomplishment or who fail to comply with or violate applicable requirements of this contract. Such action may be taken at the Government's discretion without prejudice to its rights under any other provision of this contract, including the Termination for Default clause.
                                </P>
                                <P>(2) The Contractor shall identify all personnel who occupy a position designated as mission essential and ensure the continuity of essential Contractor services during designated operations, unless, after consultation with the Contracting Officer, Contracting Officer's representative, or local commander, the Contracting Officer directs withdrawal due to security conditions.</P>
                                <P>
                                    (3) The Contractor shall ensure that Contractor personnel follow the guidance at paragraph (e)(2)(v) of this clause and any specific Combatant Commander guidance on reporting offenses alleged to have been committed by or against Contractor personnel to appropriate investigative authorities.
                                    <PRTPAGE P="587"/>
                                </P>
                                <P>(4) Contractor personnel shall return all U.S. Government-issued identification, to include the Common Access Card, to appropriate U.S. Government authorities at the end of their deployment (or, for non-CAAF, at the end of their employment under this contract).</P>
                                <P>
                                    (i) 
                                    <E T="03">Military clothing and protective equipment.</E>
                                     (1) Contractor personnel are prohibited from wearing military clothing unless specifically authorized in writing by the Combatant Commander. If authorized to wear military clothing, Contractor personnel must—
                                </P>
                                <P>(i) Wear distinctive patches, arm bands, nametags, or headgear, in order to be distinguishable from military personnel, consistent with force protection measures; and</P>
                                <P>(ii) Carry the written authorization with them at all times.</P>
                                <P>(2) Contractor personnel may wear military-unique organizational clothing and individual equipment (OCIE) required for safety and security, such as ballistic, nuclear, biological, or chemical protective equipment.</P>
                                <P>(3) The deployment center, or the Combatant Commander, shall issue OCIE and shall provide training, if necessary, to ensure the safety and security of Contractor personnel.</P>
                                <P>(4) The Contractor shall ensure that all issued OCIE is returned to the point of issue, unless otherwise directed by the Contracting Officer.</P>
                                <P>
                                    (j) 
                                    <E T="03">Weapons.</E>
                                     (1) If the Contractor requests that its personnel performing in the designated operational area be authorized to carry weapons for individual self-defense, the request shall be made through the Contracting Officer to the Combatant Commander, in accordance with DoD Instruction 3020.41, Operational Contractor Support. The Combatant Commander will determine whether to authorize in-theater Contractor personnel to carry weapons and what weapons and ammunition will be allowed.
                                </P>
                                <P>(2) If Contractor personnel are authorized to carry weapons in accordance with paragraph (j)(1) of this clause, the Contracting Officer will notify the Contractor what weapons and ammunition are authorized.</P>
                                <P>(3) The Contractor shall ensure that its personnel who are authorized to carry weapons—</P>
                                <P>(i) Are adequately trained to carry and use them—</P>
                                <P>(A) Safely;</P>
                                <P>(B) With full understanding of, and adherence to, the rules of the use of force issued by the Combatant Commander; and</P>
                                <P>(C) In compliance with applicable agency policies, agreements, rules, regulations, and other applicable law;</P>
                                <P>(ii) Are not barred from possession of a firearm by 18 U.S.C. 922;</P>
                                <P>(iii) Adhere to all guidance and orders issued by the Combatant Commander regarding possession, use, safety, and accountability of weapons and ammunition;</P>
                                <P>(iv) Comply with applicable Combatant Commander and local commander force-protection policies; and</P>
                                <P>(v) Understand that the inappropriate use of force could subject them to U.S. or host-nation prosecution and civil liability.</P>
                                <P>(4) Whether or not weapons are Government-furnished, all liability for the use of any weapon by Contractor personnel rests solely with the Contractor and the Contractor employee using such weapon.</P>
                                <P>(5) Upon redeployment or revocation by the Combatant Commander of the Contractor's authorization to issue firearms, the Contractor shall ensure that all Government-issued weapons and unexpended ammunition are returned as directed by the Contracting Officer.</P>
                                <P>
                                    (k) 
                                    <E T="03">Vehicle or equipment licenses.</E>
                                     Contractor personnel shall possess the required licenses to operate all vehicles or equipment necessary to perform the contract in the designated operational area.
                                </P>
                                <P>
                                    (l) 
                                    <E T="03">Purchase of scarce goods and services.</E>
                                     If the Combatant Commander has established an organization for the designated operational area whose function is to determine that certain items are scarce goods or services, the Contractor shall coordinate with that organization local purchases of goods and services designated as scarce, in accordance with instructions provided by the Contracting Officer.
                                </P>
                                <P>
                                    (m) 
                                    <E T="03">Evacuation.</E>
                                     (1) If the Combatant Commander orders a mandatory evacuation of some or all personnel, the Government will provide assistance, to the extent available, to United States and third country national Contractor personnel.
                                </P>
                                <P>(2) In the event of a non-mandatory evacuation order, unless authorized in writing by the Contracting Officer, the Contractor shall maintain personnel on location sufficient to meet obligations under this contract.</P>
                                <P>
                                    (n) 
                                    <E T="03">Next of kin notification and personnel recovery.</E>
                                     (1) The Contractor shall be responsible for notification of the employee-designated next of kin in the event an employee dies, requires evacuation due to an injury, or is isolated, missing, detained, captured, or abducted.
                                </P>
                                <P>(2) In the case of isolated, missing, detained, captured, or abducted Contractor personnel, the Government will assist in personnel recovery actions in accordance with DoD Directive 3002.01E, Personnel Recovery in the Department of Defense.</P>
                                <P>
                                    (o) 
                                    <E T="03">Mortuary affairs.</E>
                                     Contractor personnel who die while in support of the U.S. Armed Forces shall be covered by the DoD mortuary affairs program as described in DoD Directive 1300.22, Mortuary Affairs Policy, and DoD Instruction 3020.41, Operational Contractor Support.
                                    <PRTPAGE P="588"/>
                                </P>
                                <P>
                                    (p) 
                                    <E T="03">Changes.</E>
                                     In addition to the changes otherwise authorized by the Changes clause of this contract, the Contracting Officer may, at any time, by written order identified as a change order, make changes in the place of performance or Government-furnished facilities, equipment, material, services, or site. Any change order issued in accordance with this paragraph (p) shall be subject to the provisions of the Changes clause of this contract.
                                </P>
                                <P>
                                    (q) 
                                    <E T="03">Subcontracts.</E>
                                     The Contractor shall incorporate the substance of this clause, including this paragraph (q), in all subcontracts when subcontractor personnel are supporting U.S. Armed Forces deployed outside the United States in—
                                </P>
                                <P>(1) Contingency operations;</P>
                                <P>(2) Peace operations consistent with Joint Publication 3-07.3; or</P>
                                <P>(3) Other military operations or military exercises, when designated by the Combatant Commander or as directed by the Secretary of Defense.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[73 FR 16775, Mar. 31, 2008, as amended at 74 FR 34265, July 15, 2009; 76 FR 36884, June 23, 2011; 76 FR 38052, June 29, 2011; 78 FR 13548, Feb. 28, 2013; 79 FR 30472, May 28, 2014; 80 FR 5001, Jan. 29, 2015; 80 FR 36903, June 26, 2015; 80 FR 51753, Aug. 26, 2015; 80 FR 67255, Oct. 30, 2015; 88 FR 73238, Oct. 25, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7041</SECTNO>
                            <SUBJECT>Correspondence in English.</SUBJECT>
                            <P>As prescribed in 225.1103(2), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Correspondence in English (JUN 1997)</HD>
                                <P>The Contractor shall ensure that all contract correspondence that is addressed to the United States Government is submitted in English or with an English translation.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[62 FR 34132, June 24, 1997, as amended at 65 FR 19858, Apr. 13, 2000; 68 FR 15641, Mar. 31, 2003; 71 FR 39006, July 11, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7042</SECTNO>
                            <SUBJECT>Authorization to perform.</SUBJECT>
                            <P>As prescribed in 225.1103(3), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Authorization to Perform (APR 2003)</HD>
                                <P>The offeror represents that it has been duly authorized to operate and to do business in the country or countries in which the contract is to be performed.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[68 FR 15641, Mar. 31, 2003, as amended at 71 FR 39006, July 11, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7043</SECTNO>
                            <SUBJECT>Antiterrorism/force protection policy for defense contractors outside the United States.</SUBJECT>
                            <P>As prescribed in 225.372-2, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Antiterrorism/Force Protection Policy for Defense Contractors Outside the United States (JUN 2015)</HD>
                                <P>
                                    <E T="03">Definition. United States,</E>
                                     as used in this clause, means, the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>(b) Except as provided in paragraph (c) of this clause, the Contractor and its subcontractors, if performing or traveling outside the United States under this contract, shall—</P>
                                <P>(1) Affiliate with the Overseas Security Advisory Council, if the Contractor or subcontractor is a U.S. entity;</P>
                                <P>(2) Ensure that Contractor and subcontractor personnel who are U.S. nationals and are in-country on a non-transitory basis, register with the U.S. Embassy, and that Contractor and subcontractor personnel who are third country nationals comply with any security related requirements of the Embassy of their nationality;</P>
                                <P>(3) Provide, to Contractor and subcontractor personnel, antiterrorism/force protection awareness information commensurate with that which the Department of Defense (DoD) provides to its military and civilian personnel and their families, to the extent such information can be made available prior to travel outside the United States; and</P>
                                <P>(4) Obtain and comply with the most current antiterrorism/force protection guidance for Contractor and subcontractor personnel.</P>
                                <P>(c) The requirements of this clause do not apply to any subcontractor that is—</P>
                                <P>(1) A foreign government;</P>
                                <P>(2) A representative of a foreign government; or</P>
                                <P>(3) A foreign corporation wholly owned by a foreign government.</P>
                                <P>
                                    (d) Information and guidance pertaining to DoD antiterrorism/force protection can be obtained from [
                                    <E T="03">Contracting Officer to insert applicable information cited in PGI 225.372-1</E>
                                    ].
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[63 FR 31937, June 11, 1998, as amended at 70 FR 23803, May 5, 2005; 70 FR 35548, June 21, 2005; 71 FR 14100, Mar. 21, 2006; 80 FR 36903, June 26, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="589"/>
                            <SECTNO>252.225-7044</SECTNO>
                            <SUBJECT>Balance of Payments Program—Construction Material.</SUBJECT>
                            <P>
                                <E T="03">Basic.</E>
                                 As prescribed in 225.7503(a) and (a)(1), use the following clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Balance of Payments Program—Construction Material—Basic (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Commercially available off-the-shelf (COTS) item</E>
                                    —
                                </P>
                                <P>(1) Means any item of supply (including construction material) that is—</P>
                                <P>(i) A commercial product (as defined in paragraph (1) of the definition of “commercial product” in section 2.101 of the Federal Acquisition Regulation (FAR);</P>
                                <P>(ii) Sold in substantial quantities in the commercial marketplace; and</P>
                                <P>(iii) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and</P>
                                <P>(2) Does not include bulk cargo, as defined in 46 U.S.C. 40102(4), such as agricultural products and petroleum products.</P>
                                <P>
                                    <E T="03">Component</E>
                                     means any article, material, or supply incorporated directly into construction material.
                                </P>
                                <P>
                                    <E T="03">Construction material</E>
                                     means an article, material, or supply brought to the construction site by the Contractor or a subcontractor for incorporation into the building or work. The term also includes an item brought to the site preassembled from articles, materials, or supplies. However, emergency life safety systems, such as emergency lighting, fire alarm, and audio evacuation systems, that are discrete systems incorporated into a public building or work and that are produced as complete systems, are evaluated as a single and distinct construction material regardless of when or how the individual parts or components of those systems are delivered to the construction site. Materials purchased directly by the Government are supplies, not construction material.
                                </P>
                                <P>
                                    <E T="03">Cost of components</E>
                                     means—
                                </P>
                                <P>(1) For components purchased by the Contractor, the acquisition cost, including transportation costs to the place of incorporation into the end product (whether or not such costs are paid to a domestic firm), and any applicable duty (whether or not a duty-free entry certificate is issued); or</P>
                                <P>(2) For components manufactured by the Contractor, all costs associated with the manufacture of the component, including transportation costs as described in paragraph (1) of this definition, plus allocable overhead costs, but excluding profit. Cost of components does not include any costs associated with the manufacture of the construction material.</P>
                                <P>
                                    <E T="03">Critical component</E>
                                     means a component that is mined, produced, or manufactured in the United States and deemed critical to the U.S. supply chain. The list of critical components is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Critical item</E>
                                     means domestic construction material or a domestic end product that is deemed critical to the U.S. supply chain. The list of critical items is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Domestic construction material</E>
                                     means—
                                </P>
                                <P>(1) For construction material that does not consist wholly or predominantly of iron or steel or a combination of both—</P>
                                <P>(i) An unmanufactured construction material mined or produced in the United States; or</P>
                                <P>(ii) A construction material manufactured in the United States, if—</P>
                                <P>(A) The cost of its components mined, produced, or manufactured in the United States exceeds 60 percent of the cost of all its components, except that the percentage will be 65 percent for items delivered in calendar years 2024 through 2028 and 75 percent for items delivered starting in calendar year 2029, unless an alternate percentage is established for a contract in accordance with FAR 25.201(c). Components of foreign origin of the same class or kind for which nonavailability determinations have been made are treated as domestic. Components of unknown origin are treated as foreign; or</P>
                                <P>(B) The construction material is a COTS item; or</P>
                                <P>(2) For construction material that consists wholly or predominantly of iron or steel or a combination of both, a construction material manufactured in the United States if the cost of iron and steel not produced in the United States (excluding fasteners) as estimated in good faith by the contractor, constitutes less than 5 percent of the cost of all the components used in such construction material (produced in the United States means that all manufacturing processes of the iron or steel must take place in the United States, except metallurgical processes involving refinement of steel additives). The cost of iron and steel not produced in the United States includes but is not limited to the cost of iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings, not produced in the United States, utilized in the manufacture of the end product and a good faith estimate of the cost of all iron or steel components not produced in the United States, excluding COTS fasteners. Iron or steel components of unknown origin are treated as foreign. If the construction material contains multiple components, the cost of all the materials used in such construction material is calculated in accordance with the definition of “cost of components” in this clause.</P>
                                <P>
                                    <E T="03">Predominantly of iron or steel or a combination of both</E>
                                     means that the cost of the iron and steel content exceeds 50 percent of the total cost of all its components. The cost of iron and steel is the cost of the iron or steel 
                                    <PRTPAGE P="590"/>
                                    mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings utilized in the manufacture of the product and a good faith estimate of the cost of iron or steel components excluding COTS fasteners.
                                </P>
                                <P>
                                    <E T="03">Steel</E>
                                     means an alloy that includes at least 50 percent iron, between 0.02 and 2 percent carbon, and may include other elements.
                                </P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Domestic preference.</E>
                                     This clause implements the Balance of Payments Program by providing a preference for domestic construction material. The Contractor shall use only domestic construction material in performing this contract, except for—
                                </P>
                                <P>(1) Construction material valued at or below the simplified acquisition threshold in part 2 of the Federal Acquisition Regulation;</P>
                                <P>(2) Information technology that is a commercial product; or</P>
                                <P>(3) The construction material or components listed by the Government as follows:</P>
                                <FP>
                                    [
                                    <E T="03">Contracting Officer to list applicable excepted materials or indicate “none”</E>
                                    ]
                                </FP>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <EXTRACT>
                                <HD SOURCE="HD1">Balance of Payments Program—Construction Material—Alternate I (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Commercially available off-the-shelf (COTS) item</E>
                                    —
                                </P>
                                <P>(1) Means any item of supply (including construction material) that is—</P>
                                <P>
                                    (i) A commercial product (as defined in paragraph (1) of the definition of 
                                    <E T="03">commercial product</E>
                                     in section 2.101 of the Federal Acquisition Regulation (FAR);
                                </P>
                                <P>(ii) Sold in substantial quantities in the commercial marketplace; and</P>
                                <P>(iii) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and</P>
                                <P>(2) Does not include bulk cargo, as defined in 46 U.S.C. 40102(4), such as agricultural products and petroleum products.</P>
                                <P>
                                    <E T="03">Component</E>
                                     means any article, material, or supply incorporated directly into construction material.
                                </P>
                                <P>
                                    <E T="03">Construction material</E>
                                     means an article, material, or supply brought to the construction site by the Contractor or a subcontractor for incorporation into the building or work. The term also includes an item brought to the site preassembled from articles, materials, or supplies. However, emergency life safety systems, such as emergency lighting, fire alarm, and audio evacuation systems, that are discrete systems incorporated into a public building or work and that are produced as complete systems, are evaluated as a single and distinct construction material regardless of when or how the individual parts or components of those systems are delivered to the construction site. Materials purchased directly by the Government are supplies, not construction material.
                                </P>
                                <P>
                                    <E T="03">Cost of components</E>
                                     means—
                                </P>
                                <P>(1) For components purchased by the Contractor, the acquisition cost, including transportation costs to the place of incorporation into the end product (whether or not such costs are paid to a domestic firm), and any applicable duty (whether or not a duty-free entry certificate is issued); or</P>
                                <P>(2) For components manufactured by the Contractor, all costs associated with the manufacture of the component, including transportation costs as described in paragraph (1) of this definition, plus allocable overhead costs, but excluding profit. Cost of components does not include any costs associated with the manufacture of the construction material.</P>
                                <P>
                                    <E T="03">Critical component</E>
                                     means a component that is mined, produced, or manufactured in the United States and deemed critical to the U.S. supply chain. The list of critical components is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Critical item</E>
                                     means domestic construction material or a domestic end product that is deemed critical to the U.S. supply chain. The list of critical items is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Domestic construction material</E>
                                     means—
                                </P>
                                <P>(1) For construction material that does not consist wholly or predominantly of iron or steel or a combination of both—</P>
                                <P>(i) An unmanufactured construction material mined or produced in the United States; or</P>
                                <P>(ii) A construction material manufactured in the United States, if—</P>
                                <P>(A) The cost of its components mined, produced, or manufactured in the United States exceeds 60 percent of the cost of all its components, except that the percentage will be 65 percent for items delivered in calendar years 2024 through 2028 and 75 percent for items delivered starting in calendar year 2029, unless an alternate percentage is established for a contract in accordance with FAR 25.201(c). Components of foreign origin of the same class or kind for which nonavailability determinations have been made are treated as domestic. Components of unknown origin are treated as foreign; or</P>
                                <P>(B) The construction material is a COTS item; or</P>
                                <P>
                                    (2) For construction material that consists wholly or predominantly of iron or steel or a combination of both, a construction material manufactured in the United States if the cost of iron and steel not produced in the United States (excluding fasteners) as estimated in good faith by the contractor, constitutes less than 5 percent of the cost of all the components used in such construction material (produced in the United States means that all manufacturing processes of the iron or steel must take place in the 
                                    <PRTPAGE P="591"/>
                                    United States, except metallurgical processes involving refinement of steel additives). The cost of iron and steel not produced in the United States includes but is not limited to the cost of iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings, not produced in the United States, utilized in the manufacture of the construction material and a good faith estimate of the cost of all iron or steel components not produced in the United States, excluding COTS fasteners. Iron or steel components of unknown origin are treated as foreign. If the construction material contains multiple components, the cost of all the materials used in such construction material is calculated in accordance with the definition of “cost of components” in this clause.
                                </P>
                                <P>
                                    <E T="03">Predominantly of iron or steel or a combination of both</E>
                                     means that the cost of the iron and steel content exceeds 50 percent of the total cost of all its components. The cost of iron and steel is the cost of the iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings utilized in the manufacture of the product and a good faith estimate of the cost of iron or steel components excluding COTS fasteners.
                                </P>
                                <P>
                                    <E T="03">South Caucasus/Central and South Asian (SC/CASA) state</E>
                                     means Armenia, Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, Pakistan, Tajikistan, Turkmenistan, or Uzbekistan.
                                </P>
                                <P>
                                    <E T="03">SC/CASA state construction material</E>
                                     means construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of an SC/CASA state; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in an SC/CASA state into a new and different construction material distinct from the material from which it was transformed.</P>
                                <P>
                                    <E T="03">Steel</E>
                                     means an alloy that includes at least 50 percent iron, between 0.02 and 2 percent carbon, and may include other elements.
                                </P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Domestic preference.</E>
                                     This clause implements the Balance of Payments Program by providing a preference for domestic construction material. The Contractor shall use only domestic construction material or SC/CASA state construction material in performing this contract, except for—
                                </P>
                                <P>(1) Construction material valued at or below the simplified acquisition threshold in part 2 of the Federal Acquisition Regulation;</P>
                                <P>(2) Information technology that is a commercial product; or</P>
                                <P>(3) The construction material or components listed by the Government as follows:</P>
                                <FP SOURCE="FP-DASH"/>
                                <FP>
                                    [
                                    <E T="03">Contracting Officer to list applicable excepted materials or indicate “none”</E>
                                    ].
                                </FP>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate II.</E>
                                 As prescribed in 225.7503(a) and (a)(3), use the following clause, which includes, in the definition of “domestic construction material” at paragraph (1)(ii)(A), the domestic content threshold that will apply to the entire contract period of performance:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Balance of Payments Program—Construction Material—Alternate II (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>Commercially available off-the-shelf (COTS) item—</P>
                                <P>(1) Means any item of supply (including construction material) that is—</P>
                                <P>(i) A commercial product (as defined in paragraph (1) of the definition of “commercial product” in section 2.101 of the Federal Acquisition Regulation (FAR));</P>
                                <P>(ii) Sold in substantial quantities in the commercial marketplace; and</P>
                                <P>(iii) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and</P>
                                <P>(2) Does not include bulk cargo, as defined in 46 U.S.C. 40102(4), such as agricultural products and petroleum products.</P>
                                <P>
                                    <E T="03">Component</E>
                                     means any article, material, or supply incorporated directly into construction material.
                                </P>
                                <P>
                                    <E T="03">Construction material</E>
                                     means an article, material, or supply brought to the construction site by the Contractor or a subcontractor for incorporation into the building or work. The term also includes an item brought to the site preassembled from articles, materials, or supplies. However, emergency life safety systems, such as emergency lighting, fire alarm, and audio evacuation systems, that are discrete systems incorporated into a public building or work and that are produced as complete systems, are evaluated as a single and distinct construction material regardless of when or how the individual parts or components of those systems are delivered to the construction site. Materials purchased directly by the Government are supplies, not construction material.
                                </P>
                                <P>
                                    <E T="03">Cost of components</E>
                                     means—
                                </P>
                                <P>(1) For components purchased by the Contractor, the acquisition cost, including transportation costs to the place of incorporation into the end product (whether or not such costs are paid to a domestic firm), and any applicable duty (whether or not a duty-free entry certificate is issued); or</P>
                                <P>
                                    (2) For components manufactured by the Contractor, all costs associated with the manufacture of the component, including transportation costs as described in paragraph (1) of this definition, plus allocable overhead costs, but excluding profit. Cost of 
                                    <PRTPAGE P="592"/>
                                    components does not include any costs associated with the manufacture of the construction material.
                                </P>
                                <P>
                                    <E T="03">Critical component</E>
                                     means a component that is mined, produced, or manufactured in the United States and deemed critical to the U.S. supply chain. The list of critical components is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Critical item</E>
                                     means domestic construction material or a domestic end product that is deemed critical to the U.S. supply chain. The list of critical items is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Domestic construction material</E>
                                     means—
                                </P>
                                <P>(1) For construction material that does not consist wholly or predominantly of iron or steel or a combination of both—</P>
                                <P>(i) An unmanufactured construction material mined or produced in the United States; or</P>
                                <P>(ii) A construction material manufactured in the United States, if—</P>
                                <P>(A) The cost of its components mined, produced, or manufactured in the United States exceeds, for the entire period of performance for a contract awarded in: calendar year 2023, 60 percent of the cost of all its components; calendar years 2024 through 2028, 65 percent of the cost of all its components; or calendar year 2029 or later, 75 percent of the cost of all its components. Components of foreign origin of the same class or kind for which nonavailability determinations have been made are treated as domestic. Components of unknown origin are treated as foreign; or</P>
                                <P>(B) The construction material is a COTS item; or</P>
                                <P>(2) For construction material that consists wholly or predominantly of iron or steel or a combination of both, a construction material manufactured in the United States if the cost of iron and steel not produced in the United States (excluding fasteners) as estimated in good faith by the contractor, constitutes less than 5 percent of the cost of all the components used in such construction material (produced in the United States means that all manufacturing processes of the iron or steel must take place in the United States, except metallurgical processes involving refinement of steel additives). The cost of iron and steel not produced in the United States includes but is not limited to the cost of iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings, not produced in the United States, utilized in the manufacture of the end product and a good faith estimate of the cost of all iron or steel components not produced in the United States, excluding COTS fasteners. Iron or steel components of unknown origin are treated as foreign. If the construction material contains multiple components, the cost of all the materials used in such construction material is calculated in accordance with the definition of “cost of components” in this clause.</P>
                                <P>
                                    <E T="03">Predominantly of iron or steel or a combination of both</E>
                                     means that the cost of the iron and steel content exceeds 50 percent of the total cost of all its components. The cost of iron and steel is the cost of the iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings utilized in the manufacture of the product and a good faith estimate of the cost of iron or steel components excluding COTS fasteners.
                                </P>
                                <P>
                                    <E T="03">Steel</E>
                                     means an alloy that includes at least 50 percent iron, between 0.02 and 2 percent carbon, and may include other elements.
                                </P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Domestic preference.</E>
                                     This clause implements the Balance of Payments Program by providing a preference for domestic construction material. The Contractor shall use only domestic construction material in performing this contract, except for—
                                </P>
                                <P>(1) Construction material valued at or below the simplified acquisition threshold in FAR part 2;</P>
                                <P>(2) Information technology that is a commercial product; or</P>
                                <P>(3) The construction material or components listed by the Government as follows:</P>
                                <P>
                                    <E T="03">[Contracting Officer to list applicable excepted materials or indicate “none”].</E>
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate III.</E>
                                 As prescribed in 225.7503(a) and (a)(4), use the following clause, which includes, in the definition of “domestic construction material” at paragraph (1)(ii)(A), the domestic content threshold that will apply to the entire period of performance; adds definitions for “South Caucasus/Central and South Asian (SC/CASA) state” and “SC/CASA state construction material” to paragraph (a); and uses “domestic construction material or SC/CASA state construction material” instead of “domestic construction material” in the second sentence of paragraph (b):
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Balance of Payments Program—Construction Material—Alternate III (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>Commercially available off-the-shelf (COTS) item—</P>
                                <P>(1) Means any item of supply (including construction material) that is—</P>
                                <P>(i) A commercial product (as defined in paragraph (1) of the definition of “commercial product” in section 2.101 of the Federal Acquisition Regulation (FAR));</P>
                                <P>(ii) Sold in substantial quantities in the commercial marketplace; and</P>
                                <P>
                                    (iii) Offered to the Government, under a contract or subcontract at any tier, without 
                                    <PRTPAGE P="593"/>
                                    modification, in the same form in which it is sold in the commercial marketplace; and
                                </P>
                                <P>(2) Does not include bulk cargo, as defined in 46 U.S.C. 40102(4), such as agricultural products and petroleum products.</P>
                                <P>
                                    <E T="03">Component</E>
                                     means any article, material, or supply incorporated directly into construction material.
                                </P>
                                <P>
                                    <E T="03">Construction material</E>
                                     means an article, material, or supply brought to the construction site by the Contractor or a subcontractor for incorporation into the building or work. The term also includes an item brought to the site preassembled from articles, materials, or supplies. However, emergency life safety systems, such as emergency lighting, fire alarm, and audio evacuation systems, that are discrete systems incorporated into a public building or work and that are produced as complete systems, are evaluated as a single and distinct construction material regardless of when or how the individual parts or components of those systems are delivered to the construction site. Materials purchased directly by the Government are supplies, not construction material.
                                </P>
                                <P>
                                    <E T="03">Cost of components</E>
                                     means—
                                </P>
                                <P>(1) For components purchased by the Contractor, the acquisition cost, including transportation costs to the place of incorporation into the end product (whether or not such costs are paid to a domestic firm), and any applicable duty (whether or not a duty-free entry certificate is issued); or</P>
                                <P>(2) For components manufactured by the Contractor, all costs associated with the manufacture of the component, including transportation costs as described in paragraph (1) of this definition, plus allocable overhead costs, but excluding profit. Cost of components does not include any costs associated with the manufacture of the construction material.</P>
                                <P>
                                    <E T="03">Critical component</E>
                                     means a component that is mined, produced, or manufactured in the United States and deemed critical to the U.S. supply chain. The list of critical components is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Critical item</E>
                                     means domestic construction material or a domestic end product that is deemed critical to the U.S. supply chain. The list of critical items is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Domestic construction material</E>
                                     means—
                                </P>
                                <P>(1) For construction material that does not consist wholly or predominantly of iron or steel or a combination of both—</P>
                                <P>(i) An unmanufactured construction material mined or produced in the United States; or</P>
                                <P>(ii) A construction material manufactured in the United States, if—</P>
                                <P>(A) The cost of its components mined, produced, or manufactured in the United States exceeds, for the entire period of performance for a contract awarded in: calendar year 2023, 60 percent of the cost of all its components; calendar years 2024 through 2028, 65 percent of the cost of all its components; or calendar year 2029 or later, 75 percent of the cost of all its components. Components of foreign origin of the same class or kind for which nonavailability determinations have been made are treated as domestic. Components of unknown origin are treated as foreign; or</P>
                                <P>(B) The construction material is a COTS item; or</P>
                                <P>(2) For construction material that consists wholly or predominantly of iron or steel or a combination of both, a construction material manufactured in the United States if the cost of iron and steel not produced in the United States (excluding fasteners) as estimated in good faith by the contractor, constitutes less than 5 percent of the cost of all the components used in such construction material (produced in the United States means that all manufacturing processes of the iron or steel must take place in the United States, except metallurgical processes involving refinement of steel additives). The cost of iron and steel not produced in the United States includes but is not limited to the cost of iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings, not produced in the United States, utilized in the manufacture of the construction material and a good faith estimate of the cost of all iron or steel components not produced in the United States, excluding COTS fasteners. Iron or steel components of unknown origin are treated as foreign. If the construction material contains multiple components, the cost of all the materials used in such construction material is calculated in accordance with the definition of “cost of components” in this clause.</P>
                                <P>
                                    <E T="03">Predominantly of iron or steel or a combination of both</E>
                                     means that the cost of the iron and steel content exceeds 50 percent of the total cost of all its components. The cost of iron and steel is the cost of the iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings utilized in the manufacture of the product and a good faith estimate of the cost of iron or steel components excluding COTS fasteners.
                                </P>
                                <P>
                                    <E T="03">South Caucasus/Central and South Asian (SC/CASA) state</E>
                                     means Armenia, Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, Pakistan, Tajikistan, Turkmenistan, or Uzbekistan.
                                </P>
                                <P>
                                    <E T="03">SC/CASA state construction material</E>
                                     means construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of an SC/CASA state; or</P>
                                <P>
                                    (2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in an SC/CASA state into a new and different construction material distinct from the material from which it was transformed.
                                    <PRTPAGE P="594"/>
                                </P>
                                <P>
                                    <E T="03">Steel</E>
                                     means an alloy that includes at least 50 percent iron, between 0.02 and 2 percent carbon, and may include other elements.
                                </P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Domestic preference.</E>
                                     This clause implements the Balance of Payments Program by providing a preference for domestic construction material. The Contractor shall use only domestic construction material or SC/CASA state construction material in performing this contract, except for—
                                </P>
                                <P>(1) Construction material valued at or below the simplified acquisition threshold in FAR part 2;</P>
                                <P>(2) Information technology that is a commercial product; or</P>
                                <P>(3) The construction material or components listed by the Government as follows:</P>
                                <P>
                                    <E T="03">[Contracting Officer to list applicable excepted materials or indicate “none”].</E>
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[67 FR 20695, Apr. 26, 2002, as amended at 70 FR 2365, Jan. 13, 2005; 70 FR 35548, June 21, 2005; 74 FR 2424, Jan. 15, 2009; 75 FR 66686, Oct. 29, 2010; 75 FR 81920, Dec. 29, 2010; 77 FR 35882, June 15, 2012; 79 FR 65830, Nov. 5, 2014; 80 FR 36899, June 26, 2015; 87 FR 37450, June 23, 2022; 88 FR 6592, Jan. 31, 2023; 89 FR 11985, Feb. 15, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7045</SECTNO>
                            <SUBJECT>Balance of Payments Program—Construction Material Under Trade Agreements.</SUBJECT>
                            <P>
                                <E T="03">Basic.</E>
                                 As prescribed in 225.7503(b) and (b)(1), use the following clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Balance of Payments Program—Construction Material Under Trade Agreements—Basic (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Caribbean Basin country construction material</E>
                                     means a construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a Caribbean Basin country; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in a Caribbean Basin country into a new and different construction material distinct from the materials from which it was transformed.</P>
                                <P>
                                    <E T="03">Commercially available off-the-shelf (COTS) item</E>
                                    —
                                </P>
                                <P>(1) Means any item of supply (including construction material) that is—</P>
                                <P>(i) A commercial product (as defined in paragraph (1) of the definition of “commercial product” in section 2.101 of the Federal Acquisition Regulation (FAR));</P>
                                <P>(ii) Sold in substantial quantities in the commercial marketplace; and</P>
                                <P>(iii) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and</P>
                                <P>(2) Does not include bulk cargo, as defined in section 3 of the Shipping Act of 1984 (46 U.S.C. 40102), such as agricultural products and petroleum products.</P>
                                <P>
                                    <E T="03">Component</E>
                                     means any article, material, or supply incorporated directly into construction material.
                                </P>
                                <P>
                                    <E T="03">Construction material</E>
                                     means an article, material, or supply brought to the construction site by the Contractor or a subcontractor for incorporation into the building or work. The term also includes an item brought to the site preassembled from articles, materials, or supplies. However, emergency life safety systems, such as emergency lighting, fire alarm, and audio evacuation systems, that are discrete systems incorporated into a public building or work and that are produced as complete systems, are evaluated as a single and distinct construction material regardless of when or how the individual parts or components of those systems are delivered to the construction site. Materials purchased directly by the Government are supplies, not construction material.
                                </P>
                                <P>
                                    <E T="03">Cost of components</E>
                                     means—
                                </P>
                                <P>(1) For components purchased by the Contractor, the acquisition cost, including transportation costs to the place of incorporation into the end product (whether or not such costs are paid to a domestic firm), and any applicable duty (whether or not a duty-free entry certificate is issued); or</P>
                                <P>(2) For components manufactured by the Contractor, all costs associated with the manufacture of the component, including transportation costs as described in paragraph (1) of this definition, plus allocable overhead costs, but excluding profit. Cost of components does not include any costs associated with the manufacture of the construction material.</P>
                                <P>
                                    <E T="03">Critical component</E>
                                     means a component that is mined, produced, or manufactured in the United States and deemed critical to the U.S. supply chain. The list of critical components is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Critical item</E>
                                     means domestic construction material or a domestic end product that is deemed critical to the U.S. supply chain. The list of critical items is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Designated country</E>
                                     means—
                                </P>
                                <P>
                                    (1) A World Trade Organization Government Procurement Agreement (WTO GPA) country (Armenia, Aruba, Australia, Austria, Belgium, Bulgaria, Canada, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hong Kong, Hungary, Iceland, Ireland, Israel, Italy, Japan, Korea (Republic of), Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Moldova, Montenegro, Netherlands, New Zealand, North Macedonia, Norway, Poland, Portugal, Romania, Singapore, Slovak 
                                    <PRTPAGE P="595"/>
                                    Republic, Slovenia, Spain, Sweden, Switzerland, Taiwan (known in the World Trade Organization as “the Separate Customs Territory of Taiwan, Penghu, Kinmen, and Matsu” (Chinese Taipei)), Ukraine, or the United Kingdom);
                                </P>
                                <P>(2) A Free Trade Agreement country (Australia, Bahrain, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua, Panama, Peru, or Singapore);</P>
                                <P>(3) A least developed country (Afghanistan, Angola, Bangladesh, Benin, Bhutan, Burkina Faso, Burundi, Cambodia, Central African Republic, Chad, Comoros, Democratic Republic of Congo, Djibouti, Equatorial Guinea, Eritrea, Ethiopia, Gambia, Guinea, Guinea-Bissau, Haiti, Kiribati, Laos, Lesotho, Liberia, Madagascar, Malawi, Mali, Mauritania, Mozambique, Nepal, Niger, Rwanda, Samoa, Sao Tome and Principe, Senegal, Sierra Leone, Solomon Islands, Somalia, South Sudan, Tanzania, Timor-Leste, Togo, Tuvalu, Uganda, Vanuatu, Yemen, or Zambia); or</P>
                                <P>(4) A Caribbean Basin country (Antigua and Barbuda, Aruba, Bahamas, Barbados, Belize, Bonaire, British Virgin Islands, Curacao, Dominica, Grenada, Guyana, Haiti, Jamaica, Montserrat, Saba, St. Kitts and Nevis, St. Lucia, St. Vincent and the Grenadines, Sint Eustatius, Sint Maarten, or Trinidad and Tobago).</P>
                                <P>
                                    <E T="03">Designated country construction material</E>
                                     means a construction material that is a WTO GPA country construction material, a Free Trade Agreement country construction material, a least developed country construction material, or a Caribbean Basin country construction material.
                                </P>
                                <P>
                                    <E T="03">Domestic construction material</E>
                                     means—
                                </P>
                                <P>(1) For construction material that does not consist wholly or predominantly of iron or steel or a combination of both—</P>
                                <P>(i) An unmanufactured construction material mined or produced in the United States; or</P>
                                <P>(ii) A construction material manufactured in the United States, if—</P>
                                <P>(A) The cost of its components mined, produced, or manufactured in the United States exceeds 60 percent of the cost of all its components, except that the percentage will be 65 percent for items delivered in calendar years 2024 through 2028 and 75 percent for items delivered starting in calendar year 2029, unless an alternate percentage is established for a contract in accordance with FAR 25.201(c).Components of foreign origin of the same class or kind for which nonavailability determinations have been made are treated as domestic. Components of unknown origin are treated as foreign; or</P>
                                <P>(B) The construction material is a COTS item; or</P>
                                <P>(2) For construction material that consists wholly or predominantly of iron or steel or a combination of both, a construction material manufactured in the United States if the cost of iron and steel not produced in the United States (excluding fasteners) as estimated in good faith by the contractor, constitutes less than 5 percent of the cost of all the components used in such construction material (produced in the United States means that all manufacturing processes of the iron or steel must take place in the United States, except metallurgical processes involving refinement of steel additives). The cost of iron and steel not produced in the United States includes but is not limited to the cost of iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings, not produced in the United States, utilized in the manufacture of the construction material and a good faith estimate of the cost of all iron or steel components not produced in the United States, excluding COTS fasteners. Iron or steel components of unknown origin are treated as foreign. If the construction material contains multiple components, the cost of all the materials used in such construction material is calculated in accordance with the definition of “cost of components” in this clause.</P>
                                <P>
                                    <E T="03">Free Trade Agreement country construction material</E>
                                     means a construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a Free Trade Agreement country; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in a Free Trade Agreement country into a new and different construction material distinct from the material from which it was transformed.</P>
                                <P>
                                    <E T="03">Least developed country construction material</E>
                                     means a construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a least developed country; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country has been substantially transformed in a least developed country into a new and different construction material distinct from the materials from which it was transformed.</P>
                                <P>
                                    <E T="03">Predominantly of iron or steel or a combination of both</E>
                                     means that the cost of the iron and steel content exceeds 50 percent of the total cost of all its components. The cost of iron and steel is the cost of the iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings utilized in the manufacture of the product and a good faith estimate of the cost of iron or steel components excluding COTS fasteners.
                                    <PRTPAGE P="596"/>
                                </P>
                                <P>
                                    <E T="03">Steel</E>
                                     means an alloy that includes at least 50 percent iron, between 0.02 and 2 percent carbon, and may include other elements.
                                </P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>
                                    <E T="03">WTO GPA country construction material</E>
                                     means a construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a WTO GPA country; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in a WTO GPA country into a new and different construction material distinct from the materials from which it was transformed.</P>
                                <P>(b) This clause implements the Balance of Payments Program by providing a preference for domestic construction material. In addition, the Contracting Officer has determined that the WTO GPA and Free Trade Agreements apply to this acquisition. Therefore, the Balance of Payments Program restrictions are waived for designated country construction materials.</P>
                                <P>(c) The Contractor shall use only domestic or designated country construction material in performing this contract, except for—</P>
                                <P>(1) Construction material valued at or below the simplified acquisition threshold in part 2 of the Federal Acquisition Regulation;</P>
                                <P>(2) Information technology that is a commercial product; or</P>
                                <P>(3) The construction material or components listed by the Government as follows:</P>
                                <P>
                                    [
                                    <E T="03">Contracting Officer to list applicable excepted materials or indicate “none”</E>
                                    ]
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate I.</E>
                                 As prescribed in 225.7503(b) and (b)(2), use the following clause, which adds 
                                <E T="03">Bahraini or Mexican construction material</E>
                                 to paragraph (a), and uses a different paragraph (b) and (c) than the basic clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Balance of Payments Program—Construction Material Under Trade Agreements—Alternate I (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Bahraini or Mexican construction material</E>
                                     means a construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Bahrain or Mexico; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in Bahrain or Mexico into a new and different construction material distinct from the materials from which it was transformed.</P>
                                <P>
                                    <E T="03">Caribbean Basin country construction material</E>
                                     means a construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a Caribbean Basin country; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in a Caribbean Basin country into a new and different construction material distinct from the materials from which it was transformed.</P>
                                <P>
                                    <E T="03">Commercially available off-the-shelf (COTS) item</E>
                                    —
                                </P>
                                <P>(1) Means any item of supply (including construction material) that is—</P>
                                <P>
                                    (i) A commercial product (as defined in paragraph (1) of the definition of 
                                    <E T="03">commercial product</E>
                                     in section 2.101 of the Federal Acquisition Regulation (FAR));
                                </P>
                                <P>(ii) Sold in substantial quantities in the commercial marketplace; and</P>
                                <P>(iii) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and</P>
                                <P>(2) Does not include bulk cargo, as defined in section 3 of the Shipping Act of 1984 (46 U.S.C. 40102), such as agricultural products and petroleum products.</P>
                                <P>
                                    <E T="03">Component</E>
                                     means any article, material, or supply incorporated directly into construction material.
                                </P>
                                <P>
                                    <E T="03">Construction material</E>
                                     means an article, material, or supply brought to the construction site by the Contractor or a subcontractor for incorporation into the building or work. The term also includes an item brought to the site preassembled from articles, materials, or supplies. However, emergency life safety systems, such as emergency lighting, fire alarm, and audio evacuation systems, that are discrete systems incorporated into a public building or work and that are produced as complete systems, are evaluated as a single and distinct construction material regardless of when or how the individual parts or components of those systems are delivered to the construction site. Materials purchased directly by the Government are supplies, not construction material.
                                </P>
                                <P>
                                    <E T="03">Cost of components</E>
                                     means—
                                </P>
                                <P>(1) For components purchased by the Contractor, the acquisition cost, including transportation costs to the place of incorporation into the end product (whether or not such costs are paid to a domestic firm), and any applicable duty (whether or not a duty-free entry certificate is issued); or</P>
                                <P>(2) For components manufactured by the Contractor, all costs associated with the manufacture of the component, including transportation costs as described in paragraph (1) of this definition, plus allocable overhead costs, but excluding profit. Cost of components does not include any costs associated with the manufacture of the construction material.</P>
                                <P>
                                    <E T="03">Critical component</E>
                                     means a component that is mined, produced, or manufactured in the United States and deemed critical to the 
                                    <PRTPAGE P="597"/>
                                    U.S. supply chain. The list of critical components is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Critical item</E>
                                     means domestic construction material or a domestic end product that is deemed critical to the U.S. supply chain. The list of critical items is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Designated country</E>
                                     means—
                                </P>
                                <P>(1) A World Trade Organization Government Procurement Agreement (WTO GPA) country (Armenia, Aruba, Australia, Austria, Belgium, Bulgaria, Canada, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hong Kong, Hungary, Iceland, Ireland, Israel, Italy, Japan, Korea (Republic of), Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Moldova, Montenegro, Netherlands, New Zealand, North Macedonia, Norway, Poland, Portugal, Romania, Singapore, Slovak Republic, Slovenia, Spain, Sweden, Switzerland, Taiwan (known in the World Trade Organization as “the Separate Customs Territory of Taiwan, Penghu, Kinmen, and Matsu” (Chinese Taipei)), Ukraine, or the United Kingdom);</P>
                                <P>(2) A Free Trade Agreement country (Australia, Bahrain, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua, Panama, Peru, or Singapore);</P>
                                <P>(3) A least developed country (Afghanistan, Angola, Bangladesh, Benin, Bhutan, Burkina Faso, Burundi, Cambodia, Central African Republic, Chad, Comoros, Democratic Republic of Congo, Djibouti, Equatorial Guinea, Eritrea, Ethiopia, Gambia, Guinea, Guinea-Bissau, Haiti, Kiribati, Laos, Lesotho, Liberia, Madagascar, Malawi, Mali, Mauritania, Mozambique, Nepal, Niger, Rwanda, Samoa, Sao Tome and Principe, Senegal, Sierra Leone, Solomon Islands, Somalia, South Sudan, Tanzania, Timor-Leste, Togo, Tuvalu, Uganda, Vanuatu, Yemen, or Zambia); or</P>
                                <P>(4) A Caribbean Basin country (Antigua and Barbuda, Aruba, Bahamas, Barbados, Belize, Bonaire, British Virgin Islands, Curacao, Dominica, Grenada, Guyana, Haiti, Jamaica, Montserrat, Saba, St. Kitts and Nevis, St. Lucia, St. Vincent and the Grenadines, Sint Eustatius, Sint Maarten, or Trinidad and Tobago).</P>
                                <P>
                                    <E T="03">Designated country construction material</E>
                                     means a construction material that is a WTO GPA country construction material, a Free Trade Agreement country construction material, a least developed country construction material, or a Caribbean Basin country construction material.
                                </P>
                                <P>
                                    <E T="03">Domestic construction material</E>
                                     means—
                                </P>
                                <P>(1) For construction material that does not consist wholly or predominantly of iron or steel or a combination of both—</P>
                                <P>(i) An unmanufactured construction material mined or produced in the United States; or</P>
                                <P>(ii) A construction material manufactured in the United States, if—</P>
                                <P>(A) The cost of its components mined, produced, or manufactured in the United States exceeds 60 percent of the cost of all its components, except that the percentage will be 65 percent for items delivered in calendar years 2024 through 2028 and 75 percent for items delivered starting in calendar year 2029, unless an alternate percentage is established for a contract in accordance with FAR 25.201(c).Components of foreign origin of the same class or kind for which nonavailability determinations have been made are treated as domestic. Components of unknown origin are treated as foreign; or</P>
                                <P>(B) The construction material is a COTS item; or</P>
                                <P>(2) For construction material that consists wholly or predominantly of iron or steel or a combination of both, a construction material manufactured in the United States if the cost of iron and steel not produced in the United States (excluding fasteners) as estimated in good faith by the contractor, constitutes less than 5 percent of the cost of all the components used in such construction material (produced in the United States means that all manufacturing processes of the iron or steel must take place in the United States, except metallurgical processes involving refinement of steel additives). The cost of iron and steel not produced in the United States includes but is not limited to the cost of iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings, not produced in the United States, utilized in the manufacture of the construction material and a good faith estimate of the cost of all iron or steel components not produced in the United States, excluding COTS fasteners. Iron or steel components of unknown origin are treated as foreign. If the construction material contains multiple components, the cost of all the materials used in such construction material is calculated in accordance with the definition of “cost of components” in this clause.</P>
                                <P>
                                    <E T="03">Free Trade Agreement country construction material</E>
                                     means a construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a Free Trade Agreement country; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in a Free Trade Agreement country into a new and different construction material distinct from the material from which it was transformed.</P>
                                <P>
                                    <E T="03">Least developed country construction material</E>
                                     means a construction material that—
                                </P>
                                <P>
                                    (1) Is wholly the growth, product, or manufacture of a least developed country; or
                                    <PRTPAGE P="598"/>
                                </P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in a least developed country into a new and different construction material distinct from the materials from which it was transformed.</P>
                                <P>
                                    <E T="03">Predominantly of iron or steel or a combination of both</E>
                                     means that the cost of the iron and steel content exceeds 50 percent of the total cost of all its components. The cost of iron and steel is the cost of the iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings utilized in the manufacture of the product and a good faith estimate of the cost of iron or steel components excluding COTS fasteners.
                                </P>
                                <P>
                                    <E T="03">Steel</E>
                                     means an alloy that includes at least 50 percent iron, between 0.02 and 2 percent carbon, and may include other elements.
                                </P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>
                                    <E T="03">WTO GPA country construction material</E>
                                     means a construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a WTO GPA country; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in a WTO GPA country into a new and different construction material distinct from the materials from which it was transformed.</P>
                                <P>(b) This clause implements the Balance of Payments Program by providing a preference for domestic construction material. In addition, the Contracting Officer has determined that the WTO GPA and all Free Trade Agreements except United States-Mexico-Canada Agreement and the Bahrain Free Trade Agreement apply to this acquisition. Therefore, the Balance of Payments Program restrictions are waived for designated country construction material other than Bahraini or Mexican construction material.</P>
                                <P>(c) The Contractor shall use only domestic or designated country construction material other than Bahraini or Mexican construction material in performing this contract, except for—</P>
                                <P>(1) Construction material valued at or below the simplified acquisition threshold in part 2 of the Federal Acquisition Regulation; or</P>
                                <P>(2) Information technology that is a commercial product; or</P>
                                <P>(3) The construction material or components listed by the Government as follows:</P>
                                <FP SOURCE="FP-DASH"/>
                                <FP>
                                    [
                                    <E T="03">Contracting Officer to list applicable excepted materials or indicate “none”</E>
                                    ].
                                </FP>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate II.</E>
                                 As prescribed in 225.7503(b) and (b)(3), use the following clause, which adds 
                                <E T="03">South Caucasus/Central and South Asian (SC/CASA) state</E>
                                 and 
                                <E T="03">SC/CASA state construction material</E>
                                 to paragraph (a), uses a different paragraph (b) and introductory text for paragraph (c) than the basic clause, and adds paragraph (d):
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Balance of Payments Program—Construction Material Under Trade Agreements—Alternate II (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Caribbean Basin country construction material</E>
                                     means a construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a Caribbean Basin country; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in a Caribbean Basin country into a new and different construction material distinct from the materials from which it was transformed.</P>
                                <P>
                                    <E T="03">Commercially available off-the-shelf (COTS) item</E>
                                    —
                                </P>
                                <P>(1) Means any item of supply (including construction material) that is—</P>
                                <P>
                                    (i) A commercial product (as defined in paragraph (1) of the definition of 
                                    <E T="03">commercial product</E>
                                     in section 2.101 of the Federal Acquisition Regulation (FAR));
                                </P>
                                <P>(ii) Sold in substantial quantities in the commercial marketplace; and</P>
                                <P>(iii) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and</P>
                                <P>(2) Does not include bulk cargo, as defined in section 3 of the Shipping Act of 1984 (46 U.S.C. 40102), such as agricultural products and petroleum products.</P>
                                <P>
                                    <E T="03">Component</E>
                                     means any article, material, or supply incorporated directly into construction material.
                                </P>
                                <P>
                                    <E T="03">Construction material</E>
                                     means an article, material, or supply brought to the construction site by the Contractor or a subcontractor for incorporation into the building or work. The term also includes an item brought to the site preassembled from articles, materials, or supplies. However, emergency life safety systems, such as emergency lighting, fire alarm, and audio evacuation systems, that are discrete systems incorporated into a public building or work and that are produced as complete systems, are evaluated as a single and distinct construction material regardless of when or how the individual parts or components of those systems are delivered to the construction site. Materials purchased directly by the Government are supplies, not construction material.
                                </P>
                                <P>
                                    <E T="03">Cost of components</E>
                                     means—
                                </P>
                                <P>
                                    (1) For components purchased by the Contractor, the acquisition cost, including transportation costs to the place of incorporation into the end product (whether or not 
                                    <PRTPAGE P="599"/>
                                    such costs are paid to a domestic firm), and any applicable duty (whether or not a duty-free entry certificate is issued); or
                                </P>
                                <P>(2) For components manufactured by the Contractor, all costs associated with the manufacture of the component, including transportation costs as described in paragraph (1) of this definition, plus allocable overhead costs, but excluding profit. Cost of components does not include any costs associated with the manufacture of the construction material.</P>
                                <P>
                                    <E T="03">Critical component</E>
                                     means a component that is mined, produced, or manufactured in the United States and deemed critical to the U.S. supply chain. The list of critical components is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Critical item</E>
                                     means domestic construction material or a domestic end product that is deemed critical to the U.S. supply chain. The list of critical items is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Designated country</E>
                                     means—
                                </P>
                                <P>(1) A World Trade Organization Government Procurement Agreement (WTO GPA) country (Armenia, Aruba, Australia, Austria, Belgium, Bulgaria, Canada, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hong Kong, Hungary, Iceland, Ireland, Israel, Italy, Japan, Korea (Republic of), Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Moldova, Montenegro, Netherlands, New Zealand, North Macedonia, Norway, Poland, Portugal, Romania, Singapore, Slovak Republic, Slovenia, Spain, Sweden, Switzerland, Taiwan (known in the World Trade Organization as “the Separate Customs Territory of Taiwan, Penghu, Kinmen, and Matsu” (Chinese Taipei)), Ukraine, or the United Kingdom);</P>
                                <P>(2) A Free Trade Agreement country (Australia, Bahrain, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua, Panama, Peru, or Singapore);</P>
                                <P>(3) A least developed country (Afghanistan, Angola, Bangladesh, Benin, Bhutan, Burkina Faso, Burundi, Cambodia, Central African Republic, Chad, Comoros, Democratic Republic of Congo, Djibouti, Equatorial Guinea, Eritrea, Ethiopia, Gambia, Guinea, Guinea-Bissau, Haiti, Kiribati, Laos, Lesotho, Liberia, Madagascar, Malawi, Mali, Mauritania, Mozambique, Nepal, Niger, Rwanda, Samoa, Sao Tome and Principe, Senegal, Sierra Leone, Solomon Islands, Somalia, South Sudan, Tanzania, Timor-Leste, Togo, Tuvalu, Uganda, Vanuatu, Yemen, or Zambia); or</P>
                                <P>(4) A Caribbean Basin country (Antigua and Barbuda, Aruba, Bahamas, Barbados, Belize, Bonaire, British Virgin Islands, Curacao, Dominica, Grenada, Guyana, Haiti, Jamaica, Montserrat, Saba, St. Kitts and Nevis, St. Lucia, St. Vincent and the Grenadines, Sint Eustatius, Sint Maarten, or Trinidad and Tobago).</P>
                                <P>
                                    <E T="03">Designated country construction material</E>
                                     means a construction material that is a WTO GPA country construction material, a Free Trade Agreement country construction material, a least developed country construction material, or a Caribbean Basin country construction material.
                                </P>
                                <P>
                                    <E T="03">Domestic construction material</E>
                                     means—
                                </P>
                                <P>(1) For construction material that does not consist wholly or predominantly of iron or steel or a combination of both—</P>
                                <P>(i) An unmanufactured construction material mined or produced in the United States; or</P>
                                <P>(ii) A construction material manufactured in the United States, if—</P>
                                <P>(A) The cost of its components mined, produced, or manufactured in the United States exceeds 60 percent of the cost of all its components, except that the percentage will be 65 percent for items delivered in calendar years 2024 through 2028 and 75 percent for items delivered starting in calendar year 2029, unless an alternate percentage is established for a contract in accordance with FAR 25.201(c).Components of foreign origin of the same class or kind for which nonavailability determinations have been made are treated as domestic. Components of unknown origin are treated as foreign; or</P>
                                <P>(B) The construction material is a COTS item; or</P>
                                <P>
                                    (2) For construction material that consists wholly or predominantly of iron or steel or a combination of both, a construction material manufactured in the United States if the cost of iron and steel not produced in the United States (excluding fasteners) as estimated in good faith by the contractor, constitutes less than 5 percent of the cost of all the components used in such construction material (produced in the United States means that all manufacturing processes of the iron or steel must take place in the United States, except metallurgical processes involving refinement of steel additives). The cost of iron and steel not produced in the United States includes but is not limited to the cost of iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings, not produced in the United States, utilized in the manufacture of the construction material and a good faith estimate of the cost of all iron or steel components not produced in the United States, excluding COTS fasteners. Iron or steel components of unknown origin are treated as foreign. If the construction material contains multiple components, the cost of all the materials used in such construction material is calculated in accordance with the definition of “cost of components” in this clause.
                                    <PRTPAGE P="600"/>
                                </P>
                                <P>
                                    <E T="03">Free Trade Agreement country construction material</E>
                                     means a construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a Free Trade Agreement country; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in a Free Trade Agreement country into a new and different construction material distinct from the material from which it was transformed.</P>
                                <P>
                                    <E T="03">Least developed country construction material</E>
                                     means a construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a least developed country; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in a least developed country into a new and different construction material distinct from the materials from which it was transformed.</P>
                                <P>
                                    <E T="03">Predominantly of iron or steel or a combination of both</E>
                                     means that the cost of the iron and steel content exceeds 50 percent of the total cost of all its components. The cost of iron and steel is the cost of the iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings utilized in the manufacture of the product and a good faith estimate of the cost of iron or steel components excluding COTS fasteners.
                                </P>
                                <P>
                                    <E T="03">South Caucasus/Central and South Asian (SC/CASA) state</E>
                                     means Armenia, Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, Pakistan, Tajikistan, Turkmenistan, or Uzbekistan.
                                </P>
                                <P>
                                    <E T="03">SC/CASA state construction material</E>
                                     means construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of an SC/CASA state; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in an SC/CASA state into a new and different construction material distinct from the material from which it was transformed.</P>
                                <P>
                                    <E T="03">Steel</E>
                                     means an alloy that includes at least 50 percent iron, between 0.02 and 2 percent carbon, and may include other elements.
                                </P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>
                                    <E T="03">WTO GPA country construction material</E>
                                     means a construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a WTO GPA country; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in a WTO GPA country into a new and different construction material distinct from the materials from which it was transformed.</P>
                                <P>(b) This clause implements the Balance of Payments Program by providing a preference for domestic construction material. In addition, the Contracting Officer has determined that the WTO GPA, Free Trade Agreements, and other waivers relating to acquisitions in support of operations in Afghanistan apply to this acquisition. Therefore, the Balance of Payments Program restrictions are waived for SC/CASA state and designated country construction materials.</P>
                                <P>(c) The Contractor shall use only domestic, SC/CASA state, or designated country construction material in performing this contract, except for—</P>
                                <P>(1) Construction material valued at or below the simplified acquisition threshold in part 2 of the Federal Acquisition Regulation;</P>
                                <P>(2) Information technology that is a commercial product; or</P>
                                <P>(3) The construction material or components listed by the Government as follows:</P>
                                <FP SOURCE="FP-DASH"/>
                                <FP>
                                    [
                                    <E T="03">Contracting Officer to list applicable excepted materials or indicate “none”</E>
                                    ].
                                </FP>
                                <P>(d) If the Contractor is from an SC/CASA state, the Contractor shall inform its government of its participation in this acquisition and that it generally will not have such opportunity in the future unless its government provides reciprocal procurement opportunities to U.S. products and services and suppliers of such products and services.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate III.</E>
                                 As prescribed in 225.7503(b) and (b)(4), use the following clause, which adds 
                                <E T="03">South Caucasus/Central and South Asian (SC/CASA) state</E>
                                 and 
                                <E T="03">SC/CASA state construction material</E>
                                 to paragraph (a), uses a different paragraph (b) and introductory text for paragraph (c) than the basic clause, and adds paragraph (d):
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Balance of Payments Program—Construction Material Under Trade Agreements—Alternate III (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Caribbean Basin country construction material</E>
                                     means a construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a Caribbean Basin country; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in a Caribbean Basin country into a new and different construction material distinct from the materials from which it was transformed.</P>
                                <P>
                                    <E T="03">Commercially available off-the-shelf (COTS) item</E>
                                    —
                                </P>
                                <P>(1) Means any item of supply (including construction material) that is—</P>
                                <P>
                                    (i) A commercial product (as defined in paragraph (1) of the definition of 
                                    <E T="03">
                                        commercial 
                                        <PRTPAGE P="601"/>
                                        product
                                    </E>
                                     in section 2.101 of the Federal Acquisition Regulation (FAR));
                                </P>
                                <P>(ii) Sold in substantial quantities in the commercial marketplace; and</P>
                                <P>(iii) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and</P>
                                <P>(2) Does not include bulk cargo, as defined in section 3 of the Shipping Act of 1984 (46 U.S.C. 40102), such as agricultural products and petroleum products.</P>
                                <P>
                                    <E T="03">Component</E>
                                     means any article, material, or supply incorporated directly into construction material.
                                </P>
                                <P>
                                    <E T="03">Construction material</E>
                                     means an article, material, or supply brought to the construction site by the Contractor or a subcontractor for incorporation into the building or work. The term also includes an item brought to the site preassembled from articles, materials, or supplies. However, emergency life safety systems, such as emergency lighting, fire alarm, and audio evacuation systems, that are discrete systems incorporated into a public building or work and that are produced as complete systems, are evaluated as a single and distinct construction material regardless of when or how the individual parts or components of those systems are delivered to the construction site. Materials purchased directly by the Government are supplies, not construction material.
                                </P>
                                <P>
                                    <E T="03">Cost of components</E>
                                     means—
                                </P>
                                <P>(1) For components purchased by the Contractor, the acquisition cost, including transportation costs to the place of incorporation into the end product (whether or not such costs are paid to a domestic firm), and any applicable duty (whether or not a duty-free entry certificate is issued); or</P>
                                <P>(2) For components manufactured by the Contractor, all costs associated with the manufacture of the component, including transportation costs as described in paragraph (1) of this definition, plus allocable overhead costs, but excluding profit. Cost of components does not include any costs associated with the manufacture of the construction material.</P>
                                <P>
                                    <E T="03">Critical component</E>
                                     means a component that is mined, produced, or manufactured in the United States and deemed critical to the U.S. supply chain. The list of critical components is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Critical item</E>
                                     means domestic construction material or a domestic end product that is deemed critical to the U.S. supply chain. The list of critical items is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Designated country</E>
                                     means—
                                </P>
                                <P>(1) A World Trade Organization Government Procurement Agreement (WTO GPA) country (Armenia, Aruba, Australia, Austria, Belgium, Bulgaria, Canada, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hong Kong, Hungary, Iceland, Ireland, Israel, Italy, Japan, Korea (Republic of), Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Moldova, Montenegro, Netherlands, New Zealand, North Macedonia, Norway, Poland, Portugal, Romania, Singapore, Slovak Republic, Slovenia, Spain, Sweden, Switzerland, Taiwan (known in the World Trade Organization as “the Separate Customs Territory of Taiwan, Penghu, Kinmen, and Matsu” (Chinese Taipei)), Ukraine, or the United Kingdom);</P>
                                <P>(2) A Free Trade Agreement country (Australia, Bahrain, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua, Panama, Peru, or Singapore);</P>
                                <P>(3) A least developed country (Afghanistan, Angola, Bangladesh, Benin, Bhutan, Burkina Faso, Burundi, Cambodia, Central African Republic, Chad, Comoros, Democratic Republic of Congo, Djibouti, Equatorial Guinea, Eritrea, Ethiopia, Gambia, Guinea, Guinea-Bissau, Haiti, Kiribati, Laos, Lesotho, Liberia, Madagascar, Malawi, Mali, Mauritania, Mozambique, Nepal, Niger, Rwanda, Samoa, Sao Tome and Principe, Senegal, Sierra Leone, Solomon Islands, Somalia, South Sudan, Tanzania, Timor-Leste, Togo, Tuvalu, Uganda, Vanuatu, Yemen, or Zambia); or</P>
                                <P>(4) A Caribbean Basin country (Antigua and Barbuda, Aruba, Bahamas, Barbados, Belize, Bonaire, British Virgin Islands, Curacao, Dominica, Grenada, Guyana, Haiti, Jamaica, Montserrat, Saba, St. Kitts and Nevis, St. Lucia, St. Vincent and the Grenadines, Sint Eustatius, Sint Maarten, or Trinidad and Tobago).</P>
                                <P>
                                    <E T="03">Designated country construction material</E>
                                     means a construction material that is a WTO GPA country construction material, a Free Trade Agreement country construction material, a least developed country construction material, or a Caribbean Basin country construction material.
                                </P>
                                <P>
                                    <E T="03">Domestic construction material</E>
                                     means—
                                </P>
                                <P>(1) For construction material that does not consist wholly or predominantly of iron or steel or a combination of both—</P>
                                <P>(i) An unmanufactured construction material mined or produced in the United States; or</P>
                                <P>(ii) A construction material manufactured in the United States, if—</P>
                                <P>
                                    (A) The cost of its components mined, produced, or manufactured in the United States exceeds 60 percent of the cost of all its components, except that the percentage will be 65 percent for items delivered in calendar years 2024 through 2028 and 75 percent for items delivered starting in calendar year 2029, unless an alternate percentage is established for a contract in accordance with FAR 25.201(c).Components of foreign origin of the same class or kind for which nonavailability determinations have been made are treated 
                                    <PRTPAGE P="602"/>
                                    as domestic. Components of unknown origin are treated as foreign; or
                                </P>
                                <P>(B) The construction material is a COTS item; or</P>
                                <P>(2) For construction material that consists wholly or predominantly of iron or steel or a combination of both, a construction material manufactured in the United States if the cost of iron and steel not produced in the United States (excluding fasteners) as estimated in good faith by the contractor, constitutes less than 5 percent of the cost of all the components used in such construction material (produced in the United States means that all manufacturing processes of the iron or steel must take place in the United States, except metallurgical processes involving refinement of steel additives). The cost of iron and steel not produced in the United States includes but is not limited to the cost of iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings, not produced in the United States, utilized in the manufacture of the construction material and a good faith estimate of the cost of iron or steel components not produced in the United States, excluding COTS fasteners. Iron or steel components of unknown origin are treated as foreign. If the construction material contains multiple components, the cost of all the materials used in such construction material is calculated in accordance with the definition of “cost of components” in this clause.</P>
                                <P>
                                    <E T="03">Free Trade Agreement country construction material</E>
                                     means a construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a Free Trade Agreement country; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in a Free Trade Agreement country into a new and different construction material distinct from the material from which it was transformed.</P>
                                <P>
                                    <E T="03">Least developed country construction material</E>
                                     means a construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a least developed country; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in a least developed country into a new and different construction material distinct from the materials from which it was transformed.</P>
                                <P>
                                    <E T="03">Predominantly of iron or steel or a combination of both</E>
                                     means that the cost of the iron and steel content exceeds 50 percent of the total cost of all its components. The cost of iron and steel is the cost of the iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings utilized in the manufacture of the product and a good faith estimate of the cost of iron or steel components excluding COTS fasteners.
                                </P>
                                <P>
                                    <E T="03">South Caucasus/Central and South Asian (SC/CASA) state</E>
                                     means Armenia, Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, Pakistan, Tajikistan, Turkmenistan, or Uzbekistan.
                                </P>
                                <P>
                                    <E T="03">SC/CASA state construction material</E>
                                     means construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of An SC/CASA state; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in an SC/CASA state into a new and different construction material distinct from the material from which it was transformed.</P>
                                <P>
                                    <E T="03">Steel</E>
                                     means an alloy that includes at least 50 percent iron, between 0.02 and 2 percent carbon, and may include other elements.
                                </P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>
                                    <E T="03">WTO GPA country construction material</E>
                                     means a construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a WTO GPA country; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in a WTO GPA country into a new and different construction material distinct from the materials from which it was transformed.</P>
                                <P>(b) This clause implements the Balance of Payments Program by providing a preference for domestic construction material. In addition, the Contracting Officer has determined that the WTO GPA, all Free Trade Agreements except United States-Mexico-Canada Agreement and the Bahrain Free Trade Agreement, and other waivers relating to acquisitions in support of operations in Afghanistan apply to this acquisition. Therefore, the Balance of Payments Program restrictions are waived for SC/CASA state and designated country construction material other than Bahraini or Mexican construction material.</P>
                                <P>(c) The Contractor shall use only domestic, SC/CASA state, or designated country construction material other than Bahraini or Mexican construction material in performing this contract, except for—</P>
                                <P>(1) Construction material valued at or below the simplified acquisition threshold in part 2 of the Federal Acquisition Regulation;</P>
                                <P>(2) Information technology that is a commercial product; or</P>
                                <P>(3) The construction material or components listed by the Government as follows:</P>
                                <FP SOURCE="FP-DASH"/>
                                <FP>
                                    [
                                    <E T="03">Contracting Officer to list applicable excepted materials or indicate “none”</E>
                                    ].
                                </FP>
                                <P>
                                    (d) If the Contractor is from an SC/CASA state, the Contractor shall inform its government of its participation in this acquisition and that it generally will not have such 
                                    <PRTPAGE P="603"/>
                                    opportunity in the future unless its government provides reciprocal procurement opportunities to U.S. products and services and suppliers of such products and services.
                                </P>
                                <P>
                                    <E T="03">Alternate IV.</E>
                                     As prescribed in 225.7503(b) and (b)(5), use the following clause, which includes, in the definition of “domestic construction material” at paragraph (1)(ii)(A), the domestic content threshold that will apply to the entire contract period of performance:
                                </P>
                                <HD SOURCE="HD1">Balance of Payments Program—Construction Material Under Trade Agreements—Alternate IV (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Caribbean Basin country construction material</E>
                                     means a construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a Caribbean Basin country; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in a Caribbean Basin country into a new and different construction material distinct from the materials from which it was transformed.</P>
                                <P>
                                    <E T="03">Commercially available off-the-shelf (COTS) item</E>
                                    —
                                </P>
                                <P>(1) Means any item of supply (including construction material) that is—</P>
                                <P>(i) A commercial product (as defined in paragraph (1) of the definition of “commercial product” in section 2.101 of the Federal Acquisition Regulation (FAR));</P>
                                <P>(ii) Sold in substantial quantities in the commercial marketplace; and</P>
                                <P>(iii) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and</P>
                                <P>(2) Does not include bulk cargo, as defined in section 3 of the Shipping Act of 1984 (46 U.S.C. 40102), such as agricultural products and petroleum products.</P>
                                <P>
                                    <E T="03">Component</E>
                                     means any article, material, or supply incorporated directly into construction material.
                                </P>
                                <P>
                                    <E T="03">Construction material</E>
                                     means an article, material, or supply brought to the construction site by the Contractor or a subcontractor for incorporation into the building or work. The term also includes an item brought to the site preassembled from articles, materials, or supplies. However, emergency life safety systems, such as emergency lighting, fire alarm, and audio evacuation systems, that are discrete systems incorporated into a public building or work and that are produced as complete systems, are evaluated as a single and distinct construction material regardless of when or how the individual parts or components of those systems are delivered to the construction site. Materials purchased directly by the Government are supplies, not construction material.
                                </P>
                                <P>
                                    <E T="03">Cost of components</E>
                                     means—
                                </P>
                                <P>(1) For components purchased by the Contractor, the acquisition cost, including transportation costs to the place of incorporation into the end product (whether or not such costs are paid to a domestic firm), and any applicable duty (whether or not a duty-free entry certificate is issued); or</P>
                                <P>(2) For components manufactured by the Contractor, all costs associated with the manufacture of the component, including transportation costs as described in paragraph (1) of this definition, plus allocable overhead costs, but excluding profit. Cost of components does not include any costs associated with the manufacture of the construction material.</P>
                                <P>
                                    <E T="03">Critical component</E>
                                     means a component that is mined, produced, or manufactured in the United States and deemed critical to the U.S. supply chain. The list of critical components is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Critical item</E>
                                     means domestic construction material or a domestic end product that is deemed critical to the U.S. supply chain. The list of critical items is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Designated country</E>
                                     means—
                                </P>
                                <P>(1) A World Trade Organization Government Procurement Agreement (WTO GPA) country (Armenia, Aruba, Australia, Austria, Belgium, Bulgaria, Canada, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hong Kong, Hungary, Iceland, Ireland, Israel, Italy, Japan, Korea (Republic of), Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Moldova, Montenegro, Netherlands, New Zealand, North Macedonia, Norway, Poland, Portugal, Romania, Singapore, Slovak Republic, Slovenia, Spain, Sweden, Switzerland, Taiwan (known in the World Trade Organization as “the Separate Customs Territory of Taiwan, Penghu, Kinmen, and Matsu” (Chinese Taipei)), Ukraine, or the United Kingdom);</P>
                                <P>(2) A Free Trade Agreement country (Australia, Bahrain, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua, Panama, Peru, or Singapore);</P>
                                <P>(3) A least developed country (Afghanistan, Angola, Bangladesh, Benin, Bhutan, Burkina Faso, Burundi, Cambodia, Central African Republic, Chad, Comoros, Democratic Republic of Congo, Djibouti, Equatorial Guinea, Eritrea, Ethiopia, Gambia, Guinea, Guinea-Bissau, Haiti, Kiribati, Laos, Lesotho, Liberia, Madagascar, Malawi, Mali, Mauritania, Mozambique, Nepal, Niger, Rwanda, Samoa, Sao Tome and Principe, Senegal, Sierra Leone, Solomon Islands, Somalia, South Sudan, Tanzania, Timor-Leste, Togo, Tuvalu, Uganda, Vanuatu, Yemen, or Zambia); or</P>
                                <P>
                                    (4) A Caribbean Basin country (Antigua and Barbuda, Aruba, Bahamas, Barbados, 
                                    <PRTPAGE P="604"/>
                                    Belize, Bonaire, British Virgin Islands, Curacao, Dominica, Grenada, Guyana, Haiti, Jamaica, Montserrat, Saba, St. Kitts and Nevis, St. Lucia, St. Vincent and the Grenadines, Sint Eustatius, Sint Maarten, or Trinidad and Tobago).
                                </P>
                                <P>
                                    <E T="03">Designated country construction material</E>
                                     means a construction material that is a WTO GPA country construction material, a Free Trade Agreement country construction material, a least developed country construction material, or a Caribbean Basin country construction material.
                                </P>
                                <P>
                                    <E T="03">Domestic construction material</E>
                                     means—
                                </P>
                                <P>(1) For construction material that does not consist wholly or predominantly of iron or steel or a combination of both—</P>
                                <P>(i) An unmanufactured construction material mined or produced in the United States; or</P>
                                <P>(ii) A construction material manufactured in the United States, if—</P>
                                <P>(A) The cost of its components mined, produced, or manufactured in the United States exceeds, for the entire period of performance for a contract awarded in: calendar year 2023, 60 percent of the cost of all its components; calendar years 2024 through 2028, 65 percent of the cost of all its components; or calendar year 2029 or later, 75 percent of the cost of all its components. Components of foreign origin of the same class or kind for which nonavailability determinations have been made are treated as domestic. Components of unknown origin are treated as foreign; or</P>
                                <P>(B) The construction material is a COTS item; or</P>
                                <P>(2) For construction material that consists wholly or predominantly of iron or steel or a combination of both, a construction material manufactured in the United States if the cost of iron and steel not produced in the United States (excluding fasteners) as estimated in good faith by the contractor, constitutes less than 5 percent of the cost of all the components used in such construction material (produced in the United States means that all manufacturing processes of the iron or steel must take place in the United States, except metallurgical processes involving refinement of steel additives). The cost of iron and steel not produced in the United States includes but is not limited to the cost of iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings, not produced in the United States, utilized in the manufacture of the construction material and a good faith estimate of the cost of all iron or steel components not produced in the United States, excluding COTS fasteners. Iron or steel components of unknown origin are treated as foreign. If the construction material contains multiple components, the cost of all the materials used in such construction material is calculated in accordance with the definition of “cost of components” in this clause.</P>
                                <P>
                                    <E T="03">Free Trade Agreement country construction material</E>
                                     means a construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a Free Trade Agreement country; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in a Free Trade Agreement country into a new and different construction material distinct from the material from which it was transformed.</P>
                                <P>
                                    <E T="03">Least developed country construction material</E>
                                     means a construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a least developed country; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country has been substantially transformed in a least developed country into a new and different construction material distinct from the materials from which it was transformed.</P>
                                <P>
                                    <E T="03">Predominantly of iron or steel or a combination of both</E>
                                     means that the cost of the iron and steel content exceeds 50 percent of the total cost of all its components. The cost of iron and steel is the cost of the iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings utilized in the manufacture of the product and a good faith estimate of the cost of iron or steel components excluding COTS fasteners.
                                </P>
                                <P>
                                    <E T="03">Steel</E>
                                     means an alloy that includes at least 50 percent iron, between 0.02 and 2 percent carbon, and may include other elements.
                                </P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>
                                    <E T="03">WTO GPA country construction material</E>
                                     means a construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a WTO GPA country; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in a WTO GPA country into a new and different construction material distinct from the materials from which it was transformed.</P>
                                <P>(b) This clause implements the Balance of Payments Program by providing a preference for domestic construction material. In addition, the Contracting Officer has determined that the WTO GPA and Free Trade Agreements apply to this acquisition. Therefore, the Balance of Payments Program restrictions are waived for designated country construction materials.</P>
                                <P>(c) The Contractor shall use only domestic or designated country construction material in performing this contract, except for—</P>
                                <P>
                                    (1) Construction material valued at or below the simplified acquisition threshold in FAR part 2;
                                    <PRTPAGE P="605"/>
                                </P>
                                <P>(2) Information technology that is a commercial product; or</P>
                                <P>(3) The construction material or components listed by the Government as follows:</P>
                                <P>
                                    <E T="03">[Contracting Officer to list applicable excepted materials or indicate “none”].</E>
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate V.</E>
                                 As prescribed in 225.7503(b) and (b)(6), use the following clause, which includes, in the definition of “domestic construction material” at paragraph (1)(ii)(A), the domestic content threshold that will apply to the entire contract period of performance; adds “Bahraini or Mexican construction material” to paragraph (a); and uses different paragraphs (b) and (c) than the basic clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Balance of Payments Program—Construction Material Under Trade Agreements—Alternate V (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Bahraini or Mexican construction material</E>
                                     means a construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of Bahrain or Mexico; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in Bahrain or Mexico into a new and different construction material distinct from the materials from which it was transformed.</P>
                                <P>
                                    <E T="03">Caribbean Basin country construction material</E>
                                     means a construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a Caribbean Basin country; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in a Caribbean Basin country into a new and different construction material distinct from the materials from which it was transformed.</P>
                                <P>
                                    <E T="03">Commercially available off-the-shelf (COTS) item</E>
                                    —
                                </P>
                                <P>(1) Means any item of supply (including construction material) that is—</P>
                                <P>(i) A commercial product (as defined in paragraph (1) of the definition of “commercial product” in section 2.101 of the Federal Acquisition Regulation (FAR));</P>
                                <P>(ii) Sold in substantial quantities in the commercial marketplace; and</P>
                                <P>(iii) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and</P>
                                <P>(2) Does not include bulk cargo, as defined in section 3 of the Shipping Act of 1984 (46 U.S.C. 40102), such as agricultural products and petroleum products.</P>
                                <P>
                                    <E T="03">Component</E>
                                     means any article, material, or supply incorporated directly into construction material.
                                </P>
                                <P>
                                    <E T="03">Construction material</E>
                                     means an article, material, or supply brought to the construction site by the Contractor or a subcontractor for incorporation into the building or work. The term also includes an item brought to the site preassembled from articles, materials, or supplies. However, emergency life safety systems, such as emergency lighting, fire alarm, and audio evacuation systems, that are discrete systems incorporated into a public building or work and that are produced as complete systems, are evaluated as a single and distinct construction material regardless of when or how the individual parts or components of those systems are delivered to the construction site. Materials purchased directly by the Government are supplies, not construction material.
                                </P>
                                <P>
                                    <E T="03">Cost of components</E>
                                     means—
                                </P>
                                <P>(1) For components purchased by the Contractor, the acquisition cost, including transportation costs to the place of incorporation into the end product (whether or not such costs are paid to a domestic firm), and any applicable duty (whether or not a duty-free entry certificate is issued); or</P>
                                <P>(2) For components manufactured by the Contractor, all costs associated with the manufacture of the component, including transportation costs as described in paragraph (1) of this definition, plus allocable overhead costs, but excluding profit. Cost of components does not include any costs associated with the manufacture of the construction material.</P>
                                <P>
                                    <E T="03">Critical component</E>
                                     means a component that is mined, produced, or manufactured in the United States and deemed critical to the U.S. supply chain. The list of critical components is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Critical item</E>
                                     means domestic construction material or a domestic end product that is deemed critical to the U.S. supply chain. The list of critical items is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Designated country</E>
                                     means—
                                </P>
                                <P>
                                    (1) A World Trade Organization Government Procurement Agreement (WTO GPA) country (Armenia, Aruba, Australia, Austria, Belgium, Bulgaria, Canada, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hong Kong, Hungary, Iceland, Ireland, Israel, Italy, Japan, Korea (Republic of), Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Moldova, Montenegro, Netherlands, New Zealand, North Macedonia, Norway, Poland, Portugal, Romania, Singapore, Slovak Republic, Slovenia, Spain, Sweden, Switzerland, Taiwan (known in the World Trade Organization as “the Separate Customs Territory of Taiwan, Penghu, Kinmen, and Matsu” (Chinese Taipei)), Ukraine, or the United Kingdom);
                                    <PRTPAGE P="606"/>
                                </P>
                                <P>(2) A Free Trade Agreement country (Australia, Bahrain, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua, Panama, Peru, or Singapore);</P>
                                <P>(3) A least developed country (Afghanistan, Angola, Bangladesh, Benin, Bhutan, Burkina Faso, Burundi, Cambodia, Central African Republic, Chad, Comoros, Democratic Republic of Congo, Djibouti, Equatorial Guinea, Eritrea, Ethiopia, Gambia, Guinea, Guinea-Bissau, Haiti, Kiribati, Laos, Lesotho, Liberia, Madagascar, Malawi, Mali, Mauritania, Mozambique, Nepal, Niger, Rwanda, Samoa, Sao Tome and Principe, Senegal, Sierra Leone, Solomon Islands, Somalia, South Sudan, Tanzania, Timor-Leste, Togo, Tuvalu, Uganda, Vanuatu, Yemen, or Zambia); or</P>
                                <P>(4) A Caribbean Basin country (Antigua and Barbuda, Aruba, Bahamas, Barbados, Belize, Bonaire, British Virgin Islands, Curacao, Dominica, Grenada, Guyana, Haiti, Jamaica, Montserrat, Saba, St. Kitts and Nevis, St. Lucia, St. Vincent and the Grenadines, Sint Eustatius, Sint Maarten, or Trinidad and Tobago).</P>
                                <P>
                                    <E T="03">Designated country construction material</E>
                                     means a construction material that is a WTO GPA country construction material, a Free Trade Agreement country construction material, a least developed country construction material, or a Caribbean Basin country construction material.
                                </P>
                                <P>
                                    <E T="03">Domestic construction material</E>
                                     means—
                                </P>
                                <P>(1) For construction material that does not consist wholly or predominantly of iron or steel or a combination of both—</P>
                                <P>(i) An unmanufactured construction material mined or produced in the United States; or</P>
                                <P>(ii) A construction material manufactured in the United States, if—</P>
                                <P>(A) The cost of its components mined, produced, or manufactured in the United States exceeds, for the entire period of performance for a contract awarded in: calendar year 2023, 60 percent of the cost of all its components; calendar years 2024 through 2028, 65 percent of the cost of all its components; or calendar year 2029 or later, 75 percent of the cost of all its components. Components of foreign origin of the same class or kind for which nonavailability determinations have been made are treated as domestic. Components of unknown origin are treated as foreign; or</P>
                                <P>(B) The construction material is a COTS item; or</P>
                                <P>(2) For construction material that consists wholly or predominantly of iron or steel or a combination of both, a construction material manufactured in the United States if the cost of iron and steel not produced in the United States (excluding fasteners) as estimated in good faith by the contractor, constitutes less than 5 percent of the cost of all the components used in such construction material (produced in the United States means that all manufacturing processes of the iron or steel must take place in the United States, except metallurgical processes involving refinement of steel additives). The cost of iron and steel not produced in the United States includes but is not limited to the cost of iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings, not produced in the United States, utilized in the manufacture of the construction material and a good faith estimate of the cost of all iron or steel components not produced in the United States, excluding COTS fasteners. Iron or steel components of unknown origin are treated as foreign. If the construction material contains multiple components, the cost of all the materials used in such construction material is calculated in accordance with the definition of “cost of components” in this clause.</P>
                                <P>
                                    <E T="03">Free Trade Agreement country construction material</E>
                                     means a construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a Free Trade Agreement country; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in a Free Trade Agreement country into a new and different construction material distinct from the material from which it was transformed.</P>
                                <P>
                                    <E T="03">Least developed country construction material</E>
                                     means a construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a least developed country; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country has been substantially transformed in a least developed country into a new and different construction material distinct from the materials from which it was transformed.</P>
                                <P>
                                    <E T="03">Predominantly of iron or steel or a combination of both</E>
                                     means that the cost of the iron and steel content exceeds 50 percent of the total cost of all its components. The cost of iron and steel is the cost of the iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings utilized in the manufacture of the product and a good faith estimate of the cost of iron or steel components excluding COTS fasteners.
                                </P>
                                <P>
                                    <E T="03">Steel</E>
                                     means an alloy that includes at least 50 percent iron, between 0.02 and 2 percent carbon, and may include other elements.
                                </P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>
                                    <E T="03">WTO GPA country construction material</E>
                                     means a construction material that—
                                </P>
                                <P>
                                    (1) Is wholly the growth, product, or manufacture of a WTO GPA country; or
                                    <PRTPAGE P="607"/>
                                </P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in a WTO GPA country into a new and different construction material distinct from the materials from which it was transformed.</P>
                                <P>(b) This clause implements the Balance of Payments Program by providing a preference for domestic construction material. In addition, the Contracting Officer has determined that the WTO GPA and all Free Trade Agreements except United States-Mexico-Canada Agreement and the Bahrain Free Trade Agreement apply to this acquisition. Therefore, the Balance of Payments Program restrictions are waived for designated country construction material other than Bahraini or Mexican construction material.</P>
                                <P>(c) The Contractor shall use only domestic or designated country construction material other than Bahraini or Mexican construction material in performing this contract, except for—</P>
                                <P>(1) Construction material valued at or below the simplified acquisition threshold in FAR part 2; or</P>
                                <P>(2) Information technology that is a commercial product; or</P>
                                <P>(3) The construction material or components listed by the Government as follows:</P>
                                <P>
                                    <E T="03">[Contracting Officer to list applicable excepted materials or indicate “none”].</E>
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate VI.</E>
                                 As prescribed in 225.7503(b) and (b)(7), use the following clause, which includes, in the definition of “domestic construction material” at paragraph (1)(ii)(A), the domestic content threshold that will apply to the entire contract period of performance; adds “South Caucasus/Central and South Asian (SC/CASA) state” and “SC/CASA state construction material” to paragraph (a); uses a different paragraph (b) and introductory text for paragraph (c) than the basic clause; and adds paragraph (d):
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Balance of Payments Program—Construction Material Under Trade Agreements—Alternate VI (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Caribbean Basin country construction material</E>
                                     means a construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a Caribbean Basin country; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in a Caribbean Basin country into a new and different construction material distinct from the materials from which it was transformed.</P>
                                <P>
                                    <E T="03">Commercially available off-the-shelf (COTS) item</E>
                                    —
                                </P>
                                <P>(1) Means any item of supply (including construction material) that is—</P>
                                <P>(i) A commercial product (as defined in paragraph (1) of the definition of “commercial product” in section 2.101 of the Federal Acquisition Regulation (FAR));</P>
                                <P>(ii) Sold in substantial quantities in the commercial marketplace; and</P>
                                <P>(iii) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and</P>
                                <P>(2) Does not include bulk cargo, as defined in section 3 of the Shipping Act of 1984 (46 U.S.C. 40102), such as agricultural products and petroleum products.</P>
                                <P>
                                    <E T="03">Component</E>
                                     means any article, material, or supply incorporated directly into construction material.
                                </P>
                                <P>
                                    <E T="03">Construction material</E>
                                     means an article, material, or supply brought to the construction site by the Contractor or a subcontractor for incorporation into the building or work. The term also includes an item brought to the site preassembled from articles, materials, or supplies. However, emergency life safety systems, such as emergency lighting, fire alarm, and audio evacuation systems, that are discrete systems incorporated into a public building or work and that are produced as complete systems, are evaluated as a single and distinct construction material regardless of when or how the individual parts or components of those systems are delivered to the construction site. Materials purchased directly by the Government are supplies, not construction material.
                                </P>
                                <P>
                                    <E T="03">Cost of components</E>
                                     means—
                                </P>
                                <P>(1) For components purchased by the Contractor, the acquisition cost, including transportation costs to the place of incorporation into the end product (whether or not such costs are paid to a domestic firm), and any applicable duty (whether or not a duty-free entry certificate is issued); or</P>
                                <P>(2) For components manufactured by the Contractor, all costs associated with the manufacture of the component, including transportation costs as described in paragraph (1) of this definition, plus allocable overhead costs, but excluding profit. Cost of components does not include any costs associated with the manufacture of the construction material.</P>
                                <P>
                                    <E T="03">Critical component</E>
                                     means a component that is mined, produced, or manufactured in the United States and deemed critical to the U.S. supply chain. The list of critical components is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Critical item</E>
                                     means domestic construction material or a domestic end product that is deemed critical to the U.S. supply chain. The list of critical items is at FAR 25.105.
                                    <PRTPAGE P="608"/>
                                </P>
                                <P>
                                    <E T="03">Designated country</E>
                                     means—
                                </P>
                                <P>(1) A World Trade Organization Government Procurement Agreement (WTO GPA) country (Armenia, Aruba, Australia, Austria, Belgium, Bulgaria, Canada, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hong Kong, Hungary, Iceland, Ireland, Israel, Italy, Japan, Korea (Republic of), Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Moldova, Montenegro, Netherlands, New Zealand, North Macedonia, Norway, Poland, Portugal, Romania, Singapore, Slovak Republic, Slovenia, Spain, Sweden, Switzerland, Taiwan (known in the World Trade Organization as “the Separate Customs Territory of Taiwan, Penghu, Kinmen, and Matsu” (Chinese Taipei)), Ukraine, or the United Kingdom);</P>
                                <P>(2) A Free Trade Agreement country (Australia, Bahrain, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua, Panama, Peru, or Singapore);</P>
                                <P>(3) A least developed country (Afghanistan, Angola, Bangladesh, Benin, Bhutan, Burkina Faso, Burundi, Cambodia, Central African Republic, Chad, Comoros, Democratic Republic of Congo, Djibouti, Equatorial Guinea, Eritrea, Ethiopia, Gambia, Guinea, Guinea-Bissau, Haiti, Kiribati, Laos, Lesotho, Liberia, Madagascar, Malawi, Mali, Mauritania, Mozambique, Nepal, Niger, Rwanda, Samoa, Sao Tome and Principe, Senegal, Sierra Leone, Solomon Islands, Somalia, South Sudan, Tanzania, Timor-Leste, Togo, Tuvalu, Uganda, Vanuatu, Yemen, or Zambia); or</P>
                                <P>(4) A Caribbean Basin country (Antigua and Barbuda, Aruba, Bahamas, Barbados, Belize, Bonaire, British Virgin Islands, Curacao, Dominica, Grenada, Guyana, Haiti, Jamaica, Montserrat, Saba, St. Kitts and Nevis, St. Lucia, St. Vincent and the Grenadines, Sint Eustatius, Sint Maarten, or Trinidad and Tobago).</P>
                                <P>
                                    <E T="03">Designated country construction material</E>
                                     means a construction material that is a WTO GPA country construction material, a Free Trade Agreement country construction material, a least developed country construction material, or a Caribbean Basin country construction material.
                                </P>
                                <P>
                                    <E T="03">Domestic construction material</E>
                                     means—
                                </P>
                                <P>(1) For construction material that does not consist wholly or predominantly of iron or steel or a combination of both—</P>
                                <P>(i) An unmanufactured construction material mined or produced in the United States; or</P>
                                <P>(ii) A construction material manufactured in the United States, if—</P>
                                <P>(A) The cost of its components mined, produced, or manufactured in the United States exceeds, for the entire period of performance for a contract awarded in: calendar year 2023, 60 percent of the cost of all its components; calendar years 2024 through 2028, 65 percent of the cost of all its components; or calendar year 2029 or later, 75 percent of the cost of all its components. Components of foreign origin of the same class or kind for which nonavailability determinations have been made are treated as domestic. Components of unknown origin are treated as foreign; or</P>
                                <P>(B) The construction material is a COTS item; or</P>
                                <P>(2) For construction material that consists wholly or predominantly of iron or steel or a combination of both, a construction material manufactured in the United States if the cost of iron and steel not produced in the United States (excluding fasteners) as estimated in good faith by the contractor, constitutes less than 5 percent of the cost of all the components used in such construction material (produced in the United States means that all manufacturing processes of the iron or steel must take place in the United States, except metallurgical processes involving refinement of steel additives). The cost of iron and steel not produced in the United States includes but is not limited to the cost of iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings, not produced in the United States, utilized in the manufacture of the construction material and a good faith estimate of the cost of all iron or steel components not produced in the United States, excluding COTS fasteners. Iron or steel components of unknown origin are treated as foreign. If the construction material contains multiple components, the cost of all the materials used in such construction material is calculated in accordance with the definition of “cost of components” in this clause.</P>
                                <P>
                                    <E T="03">Free Trade Agreement country construction material</E>
                                     means a construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a Free Trade Agreement country; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in a Free Trade Agreement country into a new and different construction material distinct from the material from which it was transformed.</P>
                                <P>
                                    <E T="03">Least developed country construction material</E>
                                     means a construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a least developed country; or</P>
                                <P>
                                    (2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in a least developed country into a new and different construction material distinct from the materials from which it was transformed.
                                    <PRTPAGE P="609"/>
                                </P>
                                <P>
                                    <E T="03">Predominantly of iron or steel or a combination of both</E>
                                     means that the cost of the iron and steel content exceeds 50 percent of the total cost of all its components. The cost of iron and steel is the cost of the iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings utilized in the manufacture of the product and a good faith estimate of the cost of iron or steel components excluding COTS fasteners.
                                </P>
                                <P>
                                    <E T="03">South Caucasus/Central and South Asian (SC/CASA) state</E>
                                     means Armenia, Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, Pakistan, Tajikistan, Turkmenistan, or Uzbekistan.
                                </P>
                                <P>
                                    <E T="03">SC/CASA state construction material</E>
                                     means construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of an SC/CASA state; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in an SC/CASA state into a new and different construction material distinct from the material from which it was transformed.</P>
                                <P>
                                    <E T="03">Steel</E>
                                     means an alloy that includes at least 50 percent iron, between 0.02 and 2 percent carbon, and may include other elements.
                                </P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>
                                    <E T="03">WTO GPA country construction material</E>
                                     means a construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a WTO GPA country; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in a WTO GPA country into a new and different construction material distinct from the materials from which it was transformed.</P>
                                <P>(b) This clause implements the Balance of Payments Program by providing a preference for domestic construction material. In addition, the Contracting Officer has determined that the WTO GPA, Free Trade Agreements, and other waivers relating to acquisitions in support of operations in Afghanistan apply to this acquisition. Therefore, the Balance of Payments Program restrictions are waived for SC/CASA state and designated country construction materials.</P>
                                <P>(c) The Contractor shall use only domestic, SC/CASA state, or designated country construction material in performing this contract, except for—</P>
                                <P>(1) Construction material valued at or below the simplified acquisition threshold in FAR part 2;</P>
                                <P>(2) Information technology that is a commercial product; or</P>
                                <P>(3) The construction material or components listed by the Government as follows:</P>
                                <P>
                                    <E T="03">[Contracting Officer to list applicable excepted materials or indicate “none”].</E>
                                </P>
                                <P>(d) If the Contractor is from an SC/CASA state, the Contractor shall inform its government of its participation in this acquisition and that it generally will not have such opportunity in the future unless its government provides reciprocal procurement opportunities to U.S. products and services and suppliers of such products and services.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate VII.</E>
                                 As prescribed in 225.7503(b) and (b)(8), use the following clause, which includes, in the definition of “domestic construction material” at paragraph (1)(ii)(A), the domestic content threshold that will apply to the entire contract period of performance; adds “South Caucasus/Central and South Asian (SC/CASA state)” and “SC/CASA state construction material” to paragraph (a); uses a different paragraph (b) and introductory text for paragraph (c) than the basic clause; and adds paragraph (d):
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Balance of Payments Program—Construction Material Under Trade Agreements—Alternate VII (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Caribbean Basin country construction material</E>
                                     means a construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a Caribbean Basin country; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in a Caribbean Basin country into a new and different construction material distinct from the materials from which it was transformed.</P>
                                <P>
                                    <E T="03">Commercially available off-the-shelf (COTS) item</E>
                                    —
                                </P>
                                <P>(1) Means any item of supply (including construction material) that is—</P>
                                <P>(i) A commercial product (as defined in paragraph (1) of the definition of “commercial product” in section 2.101 of the Federal Acquisition Regulation (FAR));</P>
                                <P>(ii) Sold in substantial quantities in the commercial marketplace; and</P>
                                <P>(iii) Offered to the Government, under a contract or subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and</P>
                                <P>(2) Does not include bulk cargo, as defined in section 3 of the Shipping Act of 1984 (46 U.S.C. 40102), such as agricultural products and petroleum products.</P>
                                <P>
                                    <E T="03">Component</E>
                                     means any article, material, or supply incorporated directly into construction material.
                                </P>
                                <P>
                                    <E T="03">Construction material</E>
                                     means an article, material, or supply brought to the construction site by the Contractor or a subcontractor for incorporation into the building or work. The term also includes an item brought to the 
                                    <PRTPAGE P="610"/>
                                    site preassembled from articles, materials, or supplies. However, emergency life safety systems, such as emergency lighting, fire alarm, and audio evacuation systems, that are discrete systems incorporated into a public building or work and that are produced as complete systems, are evaluated as a single and distinct construction material regardless of when or how the individual parts or components of those systems are delivered to the construction site. Materials purchased directly by the Government are supplies, not construction material.
                                </P>
                                <P>
                                    <E T="03">Cost of components</E>
                                     means—
                                </P>
                                <P>(1) For components purchased by the Contractor, the acquisition cost, including transportation costs to the place of incorporation into the end product (whether or not such costs are paid to a domestic firm), and any applicable duty (whether or not a duty-free entry certificate is issued); or</P>
                                <P>(2) For components manufactured by the Contractor, all costs associated with the manufacture of the component, including transportation costs as described in paragraph (1) of this definition, plus allocable overhead costs, but excluding profit. Cost of components does not include any costs associated with the manufacture of the construction material.</P>
                                <P>
                                    <E T="03">Critical component</E>
                                     means a component that is mined, produced, or manufactured in the United States and deemed critical to the U.S. supply chain. The list of critical components is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Critical item</E>
                                     means domestic construction material or a domestic end product that is deemed critical to the U.S. supply chain. The list of critical items is at FAR 25.105.
                                </P>
                                <P>
                                    <E T="03">Designated country</E>
                                     means—
                                </P>
                                <P>(1) A World Trade Organization Government Procurement Agreement (WTO GPA) country (Armenia, Aruba, Australia, Austria, Belgium, Bulgaria, Canada, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hong Kong, Hungary, Iceland, Ireland, Israel, Italy, Japan, Korea (Republic of), Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Moldova, Montenegro, Netherlands, New Zealand, North Macedonia, Norway, Poland, Portugal, Romania, Singapore, Slovak Republic, Slovenia, Spain, Sweden, Switzerland, Taiwan (known in the World Trade Organization as “the Separate Customs Territory of Taiwan, Penghu, Kinmen, and Matsu” (Chinese Taipei)), Ukraine, or the United Kingdom);</P>
                                <P>(2) A Free Trade Agreement country (Australia, Bahrain, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, Nicaragua, Panama, Peru, or Singapore);</P>
                                <P>(3) A least developed country (Afghanistan, Angola, Bangladesh, Benin, Bhutan, Burkina Faso, Burundi, Cambodia, Central African Republic, Chad, Comoros, Democratic Republic of Congo, Djibouti, Equatorial Guinea, Eritrea, Ethiopia, Gambia, Guinea, Guinea-Bissau, Haiti, Kiribati, Laos, Lesotho, Liberia, Madagascar, Malawi, Mali, Mauritania, Mozambique, Nepal, Niger, Rwanda, Samoa, Sao Tome and Principe, Senegal, Sierra Leone, Solomon Islands, Somalia, South Sudan, Tanzania, Timor-Leste, Togo, Tuvalu, Uganda, Vanuatu, Yemen, or Zambia); or</P>
                                <P>(4) A Caribbean Basin country (Antigua and Barbuda, Aruba, Bahamas, Barbados, Belize, Bonaire, British Virgin Islands, Curacao, Dominica, Grenada, Guyana, Haiti, Jamaica, Montserrat, Saba, St. Kitts and Nevis, St. Lucia, St. Vincent and the Grenadines, Sint Eustatius, Sint Maarten, or Trinidad and Tobago).</P>
                                <P>
                                    <E T="03">Designated country construction material</E>
                                     means a construction material that is a WTO GPA country construction material, a Free Trade Agreement country construction material, a least developed country construction material, or a Caribbean Basin country construction material.
                                </P>
                                <P>
                                    <E T="03">Domestic construction material</E>
                                     means—
                                </P>
                                <P>(1) For construction material that does not consist wholly or predominantly of iron or steel or a combination of both—</P>
                                <P>(i) An unmanufactured construction material mined or produced in the United States; or</P>
                                <P>(ii) A construction material manufactured in the United States, if—</P>
                                <P>(A) The cost of its components mined, produced, or manufactured in the United States exceeds, for the entire period of performance for a contract awarded in: calendar year 2023, 60 percent of the cost of all its components; calendar years 2024 through 2028, 65 percent of the cost of all its components; or calendar year 2029 or later, 75 percent of the cost of all its components. Components of foreign origin of the same class or kind for which nonavailability determinations have been made are treated as domestic. Components of unknown origin are treated as foreign; or</P>
                                <P>(B) The construction material is a COTS item; or</P>
                                <P>
                                    (2) For construction material that consists wholly or predominantly of iron or steel or a combination of both, a construction material manufactured in the United States if the cost of iron and steel not produced in the United States (excluding fasteners) as estimated in good faith by the contractor, constitutes less than 5 percent of the cost of all the components used in such construction material (produced in the United States means that all manufacturing processes of the iron or steel must take place in the United States, except metallurgical processes involving refinement of steel additives). The cost of iron and steel not produced in the United States includes but is not limited to the cost of iron or steel mill 
                                    <PRTPAGE P="611"/>
                                    products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings, not produced in the United States, utilized in the manufacture of the construction material and a good faith estimate of the cost of iron or steel components not produced in the United States, excluding COTS fasteners. Iron or steel components of unknown origin are treated as foreign. If the construction material contains multiple components, the cost of all the materials used in such construction material is calculated in accordance with the definition of “cost of components” in this clause.
                                </P>
                                <P>
                                    <E T="03">Free Trade Agreement country construction material</E>
                                     means a construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a Free Trade Agreement country; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in a Free Trade Agreement country into a new and different construction material distinct from the material from which it was transformed.</P>
                                <P>
                                    <E T="03">Least developed country construction material</E>
                                     means a construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a least developed country; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in a least developed country into a new and different construction material distinct from the materials from which it was transformed.</P>
                                <P>
                                    <E T="03">Predominantly of iron or steel or a combination of both</E>
                                     means that the cost of the iron and steel content exceeds 50 percent of the total cost of all its components. The cost of iron and steel is the cost of the iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings utilized in the manufacture of the product and a good faith estimate of the cost of iron or steel components excluding COTS fasteners.
                                </P>
                                <P>
                                    <E T="03">South Caucasus/Central and South Asian (SC/CASA) state</E>
                                     means Armenia, Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, Pakistan, Tajikistan, Turkmenistan, or Uzbekistan.
                                </P>
                                <P>
                                    <E T="03">SC/CASA state construction material</E>
                                     means construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of an SC/CASA state; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in an SC/CASA state into a new and different construction material distinct from the material from which it was transformed.</P>
                                <P>
                                    <E T="03">Steel</E>
                                     means an alloy that includes at least 50 percent iron, between 0.02 and 2 percent carbon, and may include other elements.
                                </P>
                                <P>
                                    <E T="03">United States</E>
                                     means the 50 States, the District of Columbia, and outlying areas.
                                </P>
                                <P>
                                    <E T="03">WTO GPA country construction material</E>
                                     means a construction material that—
                                </P>
                                <P>(1) Is wholly the growth, product, or manufacture of a WTO GPA country; or</P>
                                <P>(2) In the case of a construction material that consists in whole or in part of materials from another country, has been substantially transformed in a WTO GPA country into a new and different construction material distinct from the materials from which it was transformed.</P>
                                <P>(b) This clause implements the Balance of Payments Program by providing a preference for domestic construction material. In addition, the Contracting Officer has determined that the WTO GPA, all Free Trade Agreements except United States-Mexico-Canada Agreement and the Bahrain Free Trade Agreement, and other waivers relating to acquisitions in support of operations in Afghanistan apply to this acquisition. Therefore, the Balance of Payments Program restrictions are waived for SC/CASA state and designated country construction material other than Bahraini or Mexican construction material.</P>
                                <P>(c) The Contractor shall use only domestic, SC/CASA state, or designated country construction material other than Bahraini or Mexican construction material in performing this contract, except for—</P>
                                <P>(1) Construction material valued at or below the simplified acquisition threshold in FAR part 2;</P>
                                <P>(2) Information technology that is a commercial product; or</P>
                                <P>(3) The construction material or components listed by the Government as follows:</P>
                                <P>
                                    <E T="03">[Contracting Officer to list applicable excepted materials or indicate “none”].</E>
                                </P>
                                <P>(d) If the Contractor is from an SC/CASA state, the Contractor shall inform its government of its participation in this acquisition and that it generally will not have such opportunity in the future unless its government provides reciprocal procurement opportunities to U.S. products and services and suppliers of such products and services.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[70 FR 2365, Jan. 13, 2005]</CITA>
                            <EDNOTE>
                                <HD SOURCE="HED">Editorial Note:</HD>
                                <P>
                                    For 
                                    <E T="04">Federal Register</E>
                                     citations affecting section 252.225-7045, see the List of CFR Sections Affected, which appears in the Finding Aids section of the printed volume and at 
                                    <E T="03">www.govinfo.gov.</E>
                                </P>
                            </EDNOTE>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7046</SECTNO>
                            <SUBJECT>Exports by Approved Community Members in Response to the Solicitation.</SUBJECT>
                            <P>
                                As prescribed in 
                                <E T="03">225.7902-5</E>
                                (a), use the following provision:
                            </P>
                            <EXTRACT>
                                <PRTPAGE P="612"/>
                                <HD SOURCE="HD1">Exports by Approved Community Members in Response to the Solicitation (JUN 2013)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     The definitions of “Approved Community”, “defense articles”, “Defense Trade Cooperation (DTC) Treaty”, “export”, “Implementing Arrangement”, “qualifying defense articles”, “transfer”, and “U.S. DoD Treaty-eligible requirements” in DFARS clause 
                                    <E T="03">252.225-7047</E>
                                     apply to this provision.
                                </P>
                                <P>(b) All contract line items in the contemplated contract, except any identified in this paragraph, are intended to satisfy U.S. DoD Treaty-eligible requirements. Specific defense articles that are not U.S. DoD Treaty-eligible will be identified as such in those contract line items that are otherwise U.S. DoD Treaty-eligible.</P>
                                <FP SOURCE="FP-1">CONTRACT LINE ITEMS NOT INTENDED TO SATISFY U.S. DoD TREATY-ELIGIBLE REQUIREMENTS:</FP>
                                <FP SOURCE="FP-DASH"/>
                                <FP>
                                    [
                                    <E T="03">Enter Contract Line Item Number(s) or enter “None”</E>
                                    ]
                                </FP>
                                <P>(c) Approved Community members responding to the solicitation may only export or transfer defense articles that specifically respond to the stated requirements of the solicitation.</P>
                                <P>(d) Subject to the other terms and conditions of the solicitation and the contemplated contract that affect the acceptability of foreign sources or foreign end products, components, parts, or materials, Approved Community members are permitted, but not required, to use the DTC Treaties for exports or transfers of qualifying defense articles in preparing a response to this solicitation.</P>
                                <P>(e) Any conduct by an offeror responding to this solicitation that falls outside the scope of the DTC Treaties, the Implementing Arrangements, and the implementing regulations of the Department of State in 22 CFR 126.16 (Australia), 22 CFR 126.17 (United Kingdom), and 22 CFR 126 Supplement No. 1 (exempted technologies list) is subject to all applicable International Traffic in Arms Regulations (ITAR) requirements, including any criminal, civil, and administrative penalties or sanctions, as well as all other United States statutory and regulatory requirements outside of ITAR.</P>
                                <P>(f) If the offeror uses the procedures established pursuant to the DTC Treaties, the offeror agrees that, with regard to the export or transfer of a qualifying defense article associated with responding to the solicitation, the offeror shall—</P>
                                <P>(1) Comply with the requirements and provisions of the applicable DTC Treaties, the Implementing Arrangements, and corresponding regulations (including the ITAR) of the U.S. Government and the government of Australia or of the United Kingdom, as applicable; and</P>
                                <P>(2) Prior to the export or transfer of a qualifying defense article—</P>
                                <P>(i) Mark, identify, transmit, store, and handle any defense articles provided for the purpose of responding to such solicitations, as well as any defense articles provided with or developed pursuant to their responses to such solicitations, in accordance with the DTC Treaties, the Implementing Arrangements, and corresponding regulations of the United States Government and the government of Australia or the government of the United Kingdom, as applicable, including, but not limited to, the marking and classification requirements described in the applicable regulations;</P>
                                <P>(ii) Comply with the re-transfer or re-export provisions of the DTC Treaties, the Implementing Arrangements, and corresponding regulations of the United States Government and the government of Australia or the government of the United Kingdom, as applicable, including, but not limited to, the re-transfer and re-export requirements described in the applicable regulations; and</P>
                                <P>(iii) Acknowledge that any conduct that falls outside or in violation of the DTC Treaties, Implementing Arrangements, and implementing regulations of the applicable government including, but not limited to, unauthorized re-transfer or re-export in violation of the procedures established in the applicable Implementing Arrangement and implementing regulations, remains subject to applicable licensing requirements of the government of Australia, the government of the United Kingdom, and the United States Government, as applicable, including any criminal, civil, and administrative penalties or sanctions contained therein.</P>
                                <P>
                                    (g) 
                                    <E T="03">Representation.</E>
                                     The offeror shall check one of the following boxes and sign the representation:
                                </P>
                                <P>□ The offeror represents that export(s) or transfer(s) of qualifying defense articles were made in preparing its response to this solicitation and that such export(s) or transfer(s) complied with the requirements of this provision.</P>
                                <FP SOURCE="FP-DASH"/>
                                <FP>Name/Title of Duly Authorized Representative   Date</FP>
                                <P>□ The offeror represents that no export(s) or transfer(s) of qualifying defense articles were made in preparing its response to this solicitation.</P>
                                <FP SOURCE="FP-DASH"/>
                                <FP>Name/Title of Duly Authorized Representative   Date</FP>
                                <P>
                                    (h) 
                                    <E T="03">Subcontracts.</E>
                                     The offeror shall flow down the substance of this provision, including this paragraph (h), but excluding the representation at paragraph (g), to any subcontractor at any tier intending to use the DTC Treaties in responding to this solicitation.
                                </P>
                            </EXTRACT>
                            <PRTPAGE P="613"/>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[78 FR 36111, June 17, 2013]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7047</SECTNO>
                            <SUBJECT>Exports by Approved Community Members in Performance of the Contract.</SUBJECT>
                            <P>
                                As prescribed in 
                                <E T="03">225.7902-5</E>
                                (b), use the following clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Exports by Approved Community Members in Performance of the Contract (JUN 2013)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>“Approved Community” means the U.S. Government, U.S. entities that are registered and eligible exporters, and certain government and industry facilities in Australia or the United Kingdom that are approved and listed by the U.S. Government.</P>
                                <P>
                                    “Australia Community member” means an Australian government authority or nongovernmental entity or facility on the Australia Community list accessible at 
                                    <E T="03">http://pmddtc.state.gov/treaties/index.html.</E>
                                </P>
                                <P>“Defense articles” means articles, services, and related technical data, including software, in tangible or intangible form, listed on the United States Munitions List of the International Traffic in Arms Regulations (ITAR), as modified or amended.</P>
                                <P>“Defense Trade Cooperation (DTC) Treaty” means—</P>
                                <P>(1) The Treaty Between the Government of the United States of America and the government of the United Kingdom of Great Britain and Northern Ireland concerning Defense Trade Cooperation, signed at Washington and London on June 21 and 26, 2007; or</P>
                                <P>(2) The Treaty Between the Government of the United States of America and the Government of Australia Concerning Defense Trade Cooperation, signed at Sydney on September 5, 2007].</P>
                                <P>“Export” means the initial movement of defense articles from the United States Community to the United Kingdom Community and the Australia Community.</P>
                                <P>“Implementing Arrangement” means—</P>
                                <P>(1) The Implementing Arrangement Pursuant to the Treaty between the Government of the United States of America and the Government of the United Kingdom of Great Britain and Northern Ireland Concerning Defense Trade Cooperation, signed on February 14, 2008; or</P>
                                <P>(2) The Implementing Arrangement Pursuant to the Treaty between the Government of the United States of America and the Government of Australia Concerning Defense Trade Cooperation, signed on March 14, 2008.</P>
                                <P>“Qualifying defense articles” means defense articles that are not exempt from the scope of the DTC Treaties as defined in 22 CFR 126.16(g) and 22 CFR 126.17(g).</P>
                                <P>“Transfer” means the movement of previously exported defense articles within the Approved Community.</P>
                                <P>
                                    “United Kingdom Community member” means a United Kingdom government authority or nongovernmental entity or facility on the United Kingdom Community list accessible at 
                                    <E T="03">http://pmddtc.state.gov.</E>
                                </P>
                                <P>“United States Community” means—</P>
                                <P>(1) Departments and agencies of the U.S. Government, including their personnel, with, as appropriate, security accreditation and a need-to-know; and</P>
                                <P>(2) Nongovernmental U.S. entities registered with the Department of State and eligible to export defense articles under U.S. law and regulation, including their employees, with, as appropriate, security accreditation and a need-to-know.</P>
                                <P>“U.S. DoD Treaty-eligible requirements” means any defense article acquired by the DoD for use in a combined military or counterterrorism operation, cooperative research, development, production or support program, or DoD end use, as described in Article 3 of the U.S.-U.K. DTC Treaty and sections 2 and 3 of the associated Implementing Arrangement; and Article 3 of the U.S.-Australia DTC Treaty and sections 2 and 3 of the associated Implementing Arrangement.</P>
                                <P>(b) All contract line items in this contract, except any identified in this paragraph, are intended to satisfy U.S. DoD Treaty-eligible requirements. Specific defense articles that are not U.S. DoD Treaty-eligible will be identified as such in those contract line items that are otherwise U.S. DoD Treaty-eligible.</P>
                                <FP SOURCE="FP-1">CONTRACT LINE ITEMS NOT INTENDED TO SATISFY U.S. DoD TREATY-ELIGIBLE REQUIREMENTS:</FP>
                                <FP SOURCE="FP-DASH"/>
                                <FP>
                                    [
                                    <E T="03">Enter Contract Line Item Number(s) or enter “None”</E>
                                    ]
                                </FP>
                                <P>(c) Subject to the other terms and conditions of this contract that affect the acceptability of foreign sources or foreign end products, components, parts, or materials, Approved Community members are permitted, but not required, to use the DTC Treaties for exports or transfers of qualifying defense articles in performance of the contract.</P>
                                <P>
                                    (d) Any conduct by the Contractor that falls outside the scope of the DTC Treaties, the Implementing Arrangements, and 22 CFR 126.16(g) and 22 CFR 126.17(g) is subject to all applicable ITAR requirements, including any criminal, civil, and administrative penalties or sanctions, as well as all other United States statutory and regulatory requirements outside of ITAR, including, but not limited to, regulations issued by the Bureau of Alcohol, Tobacco, Firearms and Explosives found at 27 CFR parts 447, 478, and 479, which are unaffected by the DTC Treaties.
                                    <PRTPAGE P="614"/>
                                </P>
                                <P>(e) If the Contractor is an Approved Community member, the Contractor agrees that—</P>
                                <P>(1) The Contractor shall comply with the requirements of the DTC Treaties, the Implementing Arrangements, the ITAR, and corresponding regulations of the U.S. Government and the government of Australia or the government of the United Kingdom, as applicable; and</P>
                                <P>(2) Prior to the export or transfer of a qualifying defense article the Contractor—</P>
                                <P>(i) Shall mark, identify, transmit, store, and handle any defense articles provided for the purpose of responding to such solicitations, as well as any defense articles provided with or developed pursuant to their responses to such solicitations, in accordance with the DTC Treaties, the Implementing Arrangements, and corresponding regulations of the United States Government and the government of Australia or the government of the United Kingdom, as applicable, including, but not limited to, the marking and classification requirements described in the applicable regulations;</P>
                                <P>(ii) Shall comply with the re-transfer or re-export provisions of the DTC Treaties, the Implementing Arrangements, and corresponding regulations of the United States Government and the government of Australia or the government of the United Kingdom, as applicable, including, but not limited to, the re-transfer and re-export requirements described in the applicable regulations; and</P>
                                <P>(iii) Shall acknowledge that any conduct that falls outside or in violation of the DTC Treaties, Implementing Arrangements, and implementing regulations of the applicable government including, but not limited to, unauthorized re-transfer or re-export in violation of the procedures established in the applicable Implementing Arrangement and implementing regulations, remains subject to applicable licensing requirements of the government of Australia, the government of the United Kingdom, and the United States Government, including any criminal, civil, and administrative penalties or sanctions contained therein.</P>
                                <P>(f) The contractor shall include the substance of this clause, including this paragraph (f), in all subcontracts that may require exports or transfers of qualifying defense articles in connection with deliveries under the contract.</P>
                            </EXTRACT>
                            <CITA>[78 FR 36112, June 17, 2013, as amended at 78 FR 38235, June 26, 2013]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7048</SECTNO>
                            <SUBJECT>Export-Controlled Items.</SUBJECT>
                            <P>
                                As prescribed in 
                                <E T="03">225.7901-4</E>
                                , use the following clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Export-Controlled Items (JUN 2013)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition.</E>
                                     “Export-controlled items,” as used in this clause, means items subject to the Export Administration Regulations (EAR) (15 CFR Parts 730-774) or the International Traffic in Arms Regulations (ITAR) (22 CFR Parts 120-130). The term includes—
                                </P>
                                <P>(1) “Defense items,” defined in the Arms Export Control Act, 22 U.S.C. 2778(j)(4)(A), as defense articles, defense services, and related technical data, and further defined in the ITAR, 22 CFR Part 120; and</P>
                                <P>(2) “Items,” defined in the EAR as “commodities”, “software”, and “technology,” terms that are also defined in the EAR, 15 CFR 772.1.</P>
                                <P>(b) The Contractor shall comply with all applicable laws and regulations regarding export-controlled items, including, but not limited to, the requirement for contractors to register with the Department of State in accordance with the ITAR. The Contractor shall consult with the Department of State regarding any questions relating to compliance with the ITAR and shall consult with the Department of Commerce regarding any questions relating to compliance with the EAR.</P>
                                <P>(c) The Contractor's responsibility to comply with all applicable laws and regulations regarding export-controlled items exists independent of, and is not established or limited by, the information provided by this clause.</P>
                                <P>(d) Nothing in the terms of this contract adds, changes, supersedes, or waives any of the requirements of applicable Federal laws, Executive orders, and regulations, including but not limited to—</P>
                                <P>
                                    (1) The Export Administration Act of 1979, as amended (50 U.S.C. App. 2401, 
                                    <E T="03">et seq.</E>
                                    );
                                </P>
                                <P>
                                    (2) The Arms Export Control Act (22 U.S.C. 2751, 
                                    <E T="03">et seq.</E>
                                    );
                                </P>
                                <P>
                                    (3) The International Emergency Economic Powers Act (50 U.S.C. 1701, 
                                    <E T="03">et seq.</E>
                                    );
                                </P>
                                <P>(4) The Export Administration Regulations (15 CFR Parts 730-774);</P>
                                <P>(5) The International Traffic in Arms Regulations (22 CFR Parts 120-130); and</P>
                                <P>(6) Executive Order 13222, as extended.</P>
                                <P>(e) The Contractor shall include the substance of this clause, including this paragraph (e), in all subcontracts.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[78 FR 36113, June 17, 2013]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7049</SECTNO>
                            <SUBJECT>Prohibition on Acquisition of Certain Foreign Commercial Satellite Services—Representations.</SUBJECT>
                            <P>As prescribed in 225.772-5(a), use the following provision:</P>
                            <EXTRACT>
                                <PRTPAGE P="615"/>
                                <HD SOURCE="HD1">Prohibition on Acquisition of Certain Foreign Commercial Satellite Services—Representations (DEC 2018)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this provision—
                                </P>
                                <P>
                                    <E T="03">Covered foreign country, foreign entity,</E>
                                     
                                    <E T="03">government of a covered foreign country, launch vehicle,</E>
                                     
                                    <E T="03">satellite services,</E>
                                     and 
                                    <E T="03">state sponsor of terrorism</E>
                                     are defined in the clause at Defense Federal Acquisition Regulation Supplement (DFARS) 252.225-7051, Prohibition on Acquisition of Certain Commercial Satellite Services.
                                </P>
                                <P>
                                    <E T="03">Cybersecurity risk</E>
                                     means threats to and vulnerabilities of information or information systems and any related consequences caused by or resulting from unauthorized access, use, disclosure, degradation, disruption, modification, or destruction of such information or information systems, including such related consequences caused by an act of terrorism. (10 U.S.C. 2279)]
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Prohibition on award.</E>
                                     In accordance with 10 U.S.C. 2279, unless an exception is determined to apply in accordance with DFARS 225.772-4, no contract for commercial satellite services may be awarded to—
                                </P>
                                <P>(1)(i) A foreign entity if the Under Secretary of Defense for Acquisition and Sustainment or the Under Secretary of Defense for Policy reasonably believes that—</P>
                                <P>(A) The foreign entity is an entity in which the government of a covered foreign country has an ownership interest that enables the government to affect satellite operations;</P>
                                <P>(B) The foreign entity plans to, or is expected to, provide satellite services under the contract from a covered foreign country; or</P>
                                <P>(C) Entering into such contract would create an unacceptable cybersecurity risk for DoD; or</P>
                                <P>(ii) An offeror that is offering to provide the commercial satellite services of a foreign entity as described in paragraph (b)(1) of this provision; or</P>
                                <P>(2)(i) Any entity, except as provided in paragraph (b)(2)(ii) of this provision, for a launch that occurs on or after December 31, 2022, if the Under Secretary of Defense for Acquisition and Sustainment or the Under Secretary of Defense for Policy reasonably believes that such satellite service will be provided using satellites that will be—</P>
                                <P>(A) Designed or manufactured—</P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) In a covered foreign country; or
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) By an entity controlled in whole or in part by, or acting on behalf of, the government of a covered foreign country; or
                                </P>
                                <P>(B) Launched outside the United States using a launch vehicle that is—</P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) Designed or manufactured in a covered foreign country; or
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) Provided by—
                                </P>
                                <P>
                                    (
                                    <E T="03">i</E>
                                    ) The government of a covered foreign country; or
                                </P>
                                <P>
                                    (
                                    <E T="03">ii</E>
                                    ) An entity controlled in whole or in part by, or acting on behalf of, the government of a covered foreign country.
                                </P>
                                <P>(ii) The prohibition in paragraph (b)(2)(i)(B) of this provision does not apply with respect to launch vehicles for which the satellite service provider has a contract or other agreement relating to launch services that, prior to June 10, 2018, was either fully paid for by the satellite service provider or covered by a legally binding commitment of the satellite service provider to pay for such services.</P>
                                <P>
                                    (c) 
                                    <E T="03">Representations.</E>
                                     The Offeror represents that—
                                </P>
                                <P>(1) It [ ] is, [ ] is not a foreign entity in which the government of a covered foreign country has an ownership interest that enables the government to affect satellite operations. If affirmative, identify the covered foreign country: ________;</P>
                                <P>(2) It [ ] is, [ ] is not a foreign entity that plans to provide satellite services under the contract from a covered foreign country. If affirmative, identify the covered foreign country: ________;</P>
                                <P>(3) It [ ] is, [ ] is not offering commercial satellite services provided by a foreign entity in which the government of a covered foreign country has an ownership interest that enables the government to affect satellite operations. If affirmative, identify the foreign entity and the covered foreign country: ________;</P>
                                <P>(4) It [ ] is, [ ] is not offering commercial satellite services provided by a foreign entity that plans to or is expected to provide satellite services under the contract from a covered foreign country. If affirmative, identify the foreign entity and the covered foreign country: ________;</P>
                                <P>(5) It [ ] is, [ ] is not offering commercial satellite services that will use satellites, launched on or after December 31, 2022, that will be designed or manufactured in a covered foreign country. If affirmative, identify the covered foreign country: ________;</P>
                                <P>(6) It [ ] is, [ ] is not offering commercial satellite services that will use satellites, launched on or after December 31, 2022, that will be designed or manufactured by an entity controlled in whole or in part by, or acting on behalf of, the government of a covered foreign country. If affirmative, identify the entity, the covered foreign country, and the relationship of the entity to the government of the covered foreign country: ________;</P>
                                <P>(7) It [ ] is, [ ] is not offering commercial satellite services that will use satellites, launched outside the United States on or after December 31, 2022, using a launch vehicle that is designed or manufactured in a covered foreign country. If affirmative, identify the covered foreign country: ________;</P>
                                <P>
                                    (8) It [ ] is, [ ] is not offering commercial satellite services that will use satellites, launched outside the United States on or 
                                    <PRTPAGE P="616"/>
                                    after December 31, 2022, using a launch vehicle that is provided by the government of a covered foreign country. If affirmative, identify the covered foreign country: ________; and
                                </P>
                                <P>(9) It [ ] is, [ ] is not offering commercial satellite services that will use satellites, launched outside the United States on or after December 31, 2022, using a launch vehicle that is provided by an entity controlled in whole or in part by, or acting on behalf of, the government of a covered foreign country. If affirmative, identify the entity, the covered foreign country, and the relationship of the entity to the government of the covered foreign country: ________;</P>
                                <P>(d) If the Offeror has responded affirmatively to any representation in paragraphs (c)(7) through (9) of this provision, and if such launches are covered in whole or in part by a contract or other agreement relating to launch services that, prior to June 10, 2018, was either fully paid for by the satellite service provider or covered by a legally binding commitment of the satellite service provider to pay for such services, provide the following information:</P>
                                <P>(1) The entity awarded the contract or other agreement: ________.</P>
                                <P>(2) The date the contract or other agreement was awarded: ________.</P>
                                <P>(3) The period of performance for the contract or other agreement: ________.</P>
                                <P>(e) The representations in paragraph (c) of this provision are a material representation of fact upon which reliance will be placed when making award. If it is later determined that the Offeror knowingly rendered an erroneous representation, in addition to other remedies available to the Government, the Contracting Officer may terminate the contract resulting from this solicitation for default.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[83 FR 66073, Dec. 21, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7050</SECTNO>
                            <SUBJECT>Disclosure of Ownership or Control by the Government of a Country that is a State Sponsor of Terrorism.</SUBJECT>
                            <P>As prescribed in 225.771-5, use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Disclosure of Ownership or Control by the Government of a Country that is a State Sponsor of Terrorism (DEC 2022)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this provision—
                                </P>
                                <P>
                                    <E T="03">Government of a country that is a state sponsor of terrorism</E>
                                     includes the state and the government of a country that is a state sponsor of terrorism, as well as any political subdivision, agency, or instrumentality thereof.
                                </P>
                                <P>
                                    <E T="03">Significant interest</E>
                                     means—
                                </P>
                                <P>(1) Ownership of or beneficial interest in 5 percent or more of the firm's or subsidiary's securities. Beneficial interest includes holding 5 percent or more of any class of the firm's securities in “nominee shares,” “street names,” or some other method of holding securities that does not disclose the beneficial owner;</P>
                                <P>(2) Holding a management position in the firm, such as a director or officer;</P>
                                <P>(3) Ability to control or influence the election, appointment, or tenure of directors or officers in the firm;</P>
                                <P>(4) Ownership of 10 percent or more of the assets of a firm such as equipment, buildings, real estate, or other tangible assets of the firm; or</P>
                                <P>(5) Holding 50 percent or more of the indebtedness of a firm.</P>
                                <P>
                                    <E T="03">State sponsor of terrorism</E>
                                     means a country determined by the Secretary of State, under section 1754(c)(1)(A)(i) of the Export Control Reform Act of 2018 (Title XVII, Subtitle B, of the National Defense Authorization Act for Fiscal Year 2019, Pub. L. 115-232), to be a country the government of which has repeatedly provided support for acts of international terrorism. As of the date of this provision, state sponsors of terrorism include Iran, North Korea, and Syria.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Prohibition on award.</E>
                                     In accordance with 10 U.S.C. 4871, unless a waiver is granted by the Secretary of Defense, no contract may be awarded to a firm if the government of a country that is a state sponsor of terrorism owns or controls a significant interest in—
                                </P>
                                <P>(1) The firm;</P>
                                <P>(2) A subsidiary of the firm; or</P>
                                <P>(3) Any other firm that owns or controls the firm.</P>
                                <P>
                                    (c) 
                                    <E T="03">Representation.</E>
                                     Unless the Offeror submits with its offer the disclosure required in paragraph (d) of this provision, the Offeror represents, by submission of its offer, that the government of a country that is a state sponsor of terrorism does not own or control a significant interest in—
                                </P>
                                <P>(1) The Offeror;</P>
                                <P>(2) A subsidiary of the Offeror; or</P>
                                <P>(3) Any other firm that owns or controls the Offeror.</P>
                                <P>
                                    (d) 
                                    <E T="03">Disclosure.</E>
                                     (1) The Offeror shall disclose in an attachment to its offer if the government of a country that is a state sponsor of terrorism owns or controls a significant interest in the Offeror; a subsidiary of the Offeror; or any other firm that owns or controls the Offeror.
                                </P>
                                <P>(2) The disclosure shall include—</P>
                                <P>(i) Identification of each government holding a significant interest; and</P>
                                <P>(ii) A description of the significant interest held by each government.</P>
                            </EXTRACT>
                            <PRTPAGE P="617"/>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[79 FR 73490, Dec. 11, 2014, as amended at 80 FR 67253, Oct. 30, 2015; 83 FR 4448, Jan. 31, 2018; 83 FR 66074, Dec. 21, 2018; 86 FR 53883, Sept. 29, 2021; 87 FR 76997, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7051</SECTNO>
                            <SUBJECT>Prohibition on Acquisition of Certain Foreign Commercial Satellite Services.</SUBJECT>
                            <P>As prescribed in 225.772-5, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Prohibition on Acquisition of Certain Foreign Commerical Satellite Services (DEC 2022)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Covered foreign country</E>
                                     means—
                                </P>
                                <P>(1) The People's Republic of China;</P>
                                <P>(2) North Korea;</P>
                                <P>(3) The Russian Federation; or</P>
                                <P>(4) Any country that is a state sponsor of terrorism. (10 U.S.C. 2279)</P>
                                <P>
                                    <E T="03">Foreign entity</E>
                                     means—
                                </P>
                                <P>(1) Any branch, partnership, group or sub-group, association, estate, trust, corporation or division of a corporation, or organization organized under the laws of a foreign state if either its principal place of business is outside the United States or its equity securities are primarily traded on one or more foreign exchanges.</P>
                                <P>(2) Notwithstanding paragraph (1) of this definition, any branch, partnership, group or sub-group, association, estate, trust, corporation or division of a corporation, or organization that demonstrates that a majority of the equity interest in such entity is ultimately owned by U.S. nationals is not a foreign entity. (31 CFR 800.212)</P>
                                <P>
                                    <E T="03">Government of a covered foreign country</E>
                                     includes the state and the government of a covered foreign country, as well as any political subdivision, agency, or instrumentality thereof.
                                </P>
                                <P>
                                    <E T="03">Launch vehicle</E>
                                     means a fully integrated space launch vehicle. (10 U.S.C. 2279)
                                </P>
                                <P>
                                    <E T="03">Satellite services</E>
                                     means communications capabilities that utilize an on-orbit satellite for transmitting the signal from one location to another.
                                </P>
                                <P>
                                    <E T="03">State sponsor of terrorism</E>
                                     means a country determined by the Secretary of State, under section 1754(c)(1)(A)(i) of the Export Control Reform Act of 2018 (Title XVII, Subtitle B, of the National Defense Authorization Act for Fiscal Year 2019, Pub. L. 115-232), to be a country the government of which has repeatedly provided support for acts of international terrorism. As of the date of this provision, state sponsors of terrorism include Iran, North Korea, and Syria. (10 U.S.C. 4871)
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Limitation.</E>
                                     Unless specified in its offer, the Contractor shall not provide satellite services under this contract that—
                                </P>
                                <P>(1) Are from a covered foreign country; or</P>
                                <P>(2) Except as provided in paragraph (c) of this provision, use satellites that will be—</P>
                                <P>(i) Designed or manufactured—</P>
                                <P>(A) In a covered foreign country; or</P>
                                <P>(B) By an entity controlled in whole or in part by, or acting on behalf of, the government of a covered foreign country; or</P>
                                <P>(ii) Launched outside the United States using a launch vehicle that is designed or manufactured—</P>
                                <P>(A) In a covered foreign country; or</P>
                                <P>(B) Provided by—</P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) The government of a covered foreign country; or
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) An entity controlled in whole or in part by, or acting on behalf of, the government of a covered foreign country.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Exception.</E>
                                     The limitation in paragraph (b)(2) of this provision shall not apply with respect to—
                                </P>
                                <P>(1) A launch that occurs prior to December 31, 2022; or</P>
                                <P>(2) A satellite service provider that has a contract or other agreement relating to launch services that, prior to June 10, 2018, was either fully paid for by the satellite service provider or covered by a legally binding commitment of the satellite service provider to pay for such services.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[83 FR 66074, Dec. 21, 2018, as amended at 86 FR 53883, Sept. 29, 2021; 87 FR 76997, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7052</SECTNO>
                            <SUBJECT>Restriction on the Acquisition of Certain Magnets, Tantalum, and Tungsten.</SUBJECT>
                            <P>As prescribed in 225.7018-5, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Restriction on the Acquisition of Certain Magnets, Tantalum, and Tungsten (May 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Assembly</E>
                                     means an item forming a portion of a system or subsystem that—
                                </P>
                                <P>(1) Can be provisioned and replaced as an entity; and</P>
                                <P>(2) Incorporates multiple, replaceable parts.</P>
                                <P>
                                    <E T="03">Commercially available off-the-shelf item</E>
                                    —
                                </P>
                                <P>(1) Means any item of supply that is—</P>
                                <P>(i) A commercial products (as defined in paragraph (1) of the definition of “commercial products” in section 2.101 of the Federal Acquisition Regulation);</P>
                                <P>(ii) Sold in substantial quantities in the commercial marketplace; and</P>
                                <P>
                                    (iii) Offered to the Government, under this contract or a subcontract at any tier, without modification, in the same form in which it is sold in the commercial marketplace; and
                                    <PRTPAGE P="618"/>
                                </P>
                                <P>(2) Does not include bulk cargo, as defined in 46 U.S.C. 40102(4), such as agricultural products and petroleum products.</P>
                                <P>
                                    <E T="03">Component</E>
                                     means any item supplied to the Government as part of an end item or of another component.
                                </P>
                                <P>
                                    <E T="03">Covered country</E>
                                     means—
                                </P>
                                <P>(1) The Democratic People's Republic of North Korea;</P>
                                <P>(2) The People's Republic of China;</P>
                                <P>(3) The Russian Federation; and</P>
                                <P>(4) The Islamic Republic of Iran.</P>
                                <P>
                                    <E T="03">Covered material</E>
                                     means—
                                </P>
                                <P>(1) Samarium-cobalt magnets;</P>
                                <P>(2) Neodymium-iron-boron magnets;</P>
                                <P>(3) Tantalum metals and alloys;</P>
                                <P>(4) Tungsten metal powder; and</P>
                                <P>(5) Tungsten heavy alloy or any finished or semi-finished component containing tungsten heavy alloy.</P>
                                <P>
                                    <E T="03">Electronic device</E>
                                     means an item that operates by controlling the flow of electrons or other electrically charged particles in circuits, using interconnections such as resistors, inductors, capacitors, diodes, switches, transistors, or integrated circuits.
                                </P>
                                <P>
                                    <E T="03">End item</E>
                                     means the final production product when assembled or completed and ready for delivery under a line item of this contract.
                                </P>
                                <P>
                                    <E T="03">Subsystem</E>
                                     means a functional grouping of items that combine to perform a major function within an end item, such as electrical power, attitude control, and propulsion.
                                </P>
                                <P>
                                    <E T="03">Tungsten heavy alloy</E>
                                     means a tungsten base pseudo alloy that—
                                </P>
                                <P>(1) Meets the specifications of ASTM B777 or SAE-AMS-T-21014 for a particular class of tungsten heavy alloy; or</P>
                                <P>(2) Contains at least 90 percent tungsten in a matrix of other metals (such as nickel-iron or nickel-copper) and has density of at least 16.5 g/cm3).</P>
                                <P>
                                    (b) 
                                    <E T="03">Restriction.</E>
                                     (1) Except as provided in paragraph (c) of this clause—
                                </P>
                                <P>(i) Effective through December 31, 2026, the Contractor shall not deliver under this contract any covered material melted or produced in any covered country, or any end item, manufactured in any covered country, that contains a covered material; and</P>
                                <P>(ii) Effective January 1, 2027, the Contractor shall not deliver under this contract any covered material mined, refined, separated, melted, or produced in any covered country, or any end item, manufactured in any covered country, that contains a covered material (section 854, Pub. L. 118-31; 10 U.S.C. 4872).</P>
                                <P>(2)(i)(A) Effective through December 31, 2026, for samarium-cobalt magnets and neodymium-iron-boron magnets, this restriction includes—</P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) Melting samarium with cobalt to produce the samarium-cobalt alloy or melting neodymium with iron and boron to produce the neodymium-iron-boron alloy; and
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) All subsequent phases of production of the magnets, such as powder formation, pressing, sintering or bonding, and magnetization.
                                </P>
                                <P>(B) Effective January 1, 2027, for samarium-cobalt magnets this restriction includes the entire supply chain from mining or production of a cobalt and samarium ore or feedstock, including recycled material, through production of finished magnets.</P>
                                <P>(ii) The restriction on melting and producing of samarium-cobalt magnets is in addition to any applicable restrictions on melting of specialty metals if the clause at 252.225-7009, Restriction on Acquisition of Certain Articles Containing Specialty Metals, is included in the contract.</P>
                                <P>(3) Effective January 1, 2027, for neodymium-iron-boron magnets, this restriction includes entire supply chain from mining of neodymium, iron, and boron through production of finished magnets.</P>
                                <P>(4)(i) Effective through December 31, 2026, for production of tantalum metals of any kind and alloys, this restriction includes the reduction or melting of any form of tantalum to create tantalum metal including unwrought, powder, mill products, and alloys. The restriction also covers all subsequent phases of production of tantalum metals and alloys.</P>
                                <P>(ii) Effective January 1, 2027, for production of tantalum metals of any kind and alloys, this restriction includes mining or production of a tantalum ore or feedstock, including recycled material, through production of metals of any kind and alloys.</P>
                                <P>(5)(i) Effective through December 31, 2026, for production of tungsten metal powder and tungsten heavy alloy, this restriction includes—</P>
                                <P>(A) Atomization;</P>
                                <P>(B) Calcination and reduction into powder;</P>
                                <P>(C) Final consolidation of non-melt derived metal powders; and</P>
                                <P>(D) All subsequent phases of production of tungsten metal powder, tungsten heavy alloy, or any finished or semi-finished component containing tungsten heavy alloy.</P>
                                <P>(ii) Effective January 1, 2027, for production of tungsten metal powder, tungsten heavy alloy, or any finished or semi-finished component containing tungsten heavy alloy, this restriction includes mining or production of a tungsten ore or feedstock, including recycled material, through production of tungsten metal powders, tungsten heavy alloy, or any finished or semi-finished component containing tungsten heavy alloy.</P>
                                <P>
                                    (c) 
                                    <E T="03">Exceptions.</E>
                                     This clause does not apply—
                                </P>
                                <P>(1) To an end item containing a covered material that is—</P>
                                <P>
                                    (i) A commercially available off-the-shelf item, other than—
                                    <PRTPAGE P="619"/>
                                </P>
                                <P>(A) A commercially available off-the-shelf item that is—</P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) 50 percent or more tungsten by weight effective through December 31, 2026; or
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) 50 percent or more covered material by weight effective January 1, 2027;
                                </P>
                                <P>(B) Effective through December 31, 2026, a tantalum metal, tantalum alloy, or tungsten heavy alloy mill product, such as bar, billet, slab, wire, cube, sphere, block, blank, plate, or sheet, that has not been incorporated into an end item, subsystem, assembly, or component;</P>
                                <P>(ii) Effective January 1, 2027, a covered material that is a mill product such as bar, billet, slab, wire, cube, sphere, block, blank, plate, or sheet, that has not been incorporated into an end item, subsystem, assembly, or component;</P>
                                <P>(iii) An electronic device, unless otherwise specified in the contract; or</P>
                                <P>(iv) A neodymium-iron-boron magnet manufactured from recycled material if the milling of the recycled material and sintering of the final magnet takes place in the United States.</P>
                                <P>(2) If the authorized agency official concerned has made a nonavailability determination, in accordance with section 225.7018-4 of the Defense Federal Acquisition Regulation Supplement, that compliant covered materials of satisfactory quality and quantity, in the required form, cannot be procured as and when needed at a reasonable price.</P>
                                <P>(i) For tantalum metal, tantalum alloy, or tungsten heavy alloy, the term “required form” refers to the form of the mill product, such as bar, billet, wire, slab, plate, or sheet, in the grade appropriate for the production of a finished end item to be delivered to the Government under this contract; or a finished component assembled into an end item to be delivered to the Government under the contract.</P>
                                <P>(ii) For samarium-cobalt magnets or neodymium-iron-boron magnets, the term “required form” refers to the form and properties of the magnets.</P>
                                <P>
                                    (d) 
                                    <E T="03">Subcontracts.</E>
                                     The Contractor shall insert the substance of this clause, including this paragraph (d), in subcontracts and other contractual instruments that are for items containing a covered material, including subcontracts and other contractual instruments for commercial products, unless an exception in paragraph (c) of this clause applies. The Contractor shall not alter this clause other than to identify the appropriate parties.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[84 FR 18159, Apr. 30, 2019, as amended at 84 FR 72245, Dec. 31, 2019; 85 FR 61502, Sept. 29, 2020; 87 FR 52347, Aug. 25, 2022; 87 FR 76997, Dec. 16, 2022; 88 FR 6593, Jan. 31, 2023; 89 FR 46821, May 30, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7053</SECTNO>
                            <SUBJECT>Representation Regarding Prohibition on Use of Certain Energy Sourced from Inside the Russian Federation.</SUBJECT>
                            <P>As prescribed in 225.7019-4(a), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Representation Regarding Prohibition on Use of Certain Energy Sourced From Inside the Russian Federation (AUG 2021)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this provision—
                                </P>
                                <P>
                                    <E T="03">Covered military installation</E>
                                     means a military installation in Europe identified by DoD as a main operating base.
                                </P>
                                <P>
                                    <E T="03">Furnished energy</E>
                                     means energy furnished to a covered military installation in any form and for any purpose, including heating, cooling, and electricity.
                                </P>
                                <P>
                                    <E T="03">Main operating base</E>
                                     means a facility outside the United States and its territories with permanently stationed operating forces and robust infrastructure.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Prohibition.</E>
                                     In accordance with section 2821 of the National Defense Authorization Act for Fiscal Year 2020 (Pub. L. 116-92), contracts for the acquisition of furnished energy for a covered military installation shall not use any energy sourced from inside the Russian Federation as a means of generating the furnished energy for the covered military installation, unless a waiver is approved. The prohibition—
                                </P>
                                <P>(1) Applies to all forms of energy that are furnished to a covered military installation; and</P>
                                <P>(2) Does not apply to energy converted by a third party into another form of energy and not directly delivered to a covered military installation.</P>
                                <P>
                                    (c) 
                                    <E T="03">Representation.</E>
                                     By submission of its offer, the Offeror represents that the Offeror will not use or provide any energy sourced from inside the Russian Federation as a means of generating the furnished energy for the covered military installation in the performance of any contract, subcontract, or other contractual instrument resulting from this solicitation.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[86 FR 48339, Aug. 30, 2021]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="620"/>
                            <SECTNO>252.225-7054</SECTNO>
                            <SUBJECT>Prohibition on Use of Certain Energy Sourced from Inside the Russian Federation.</SUBJECT>
                            <P>As prescribed in 225.7019-4(b), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Prohibition on Use of Certain Energy Sourced From Inside the Russian Federation (JAN 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Covered military installation</E>
                                     means a military installation in Europe identified by DoD as a main operating base.
                                </P>
                                <P>
                                    <E T="03">Furnished energy</E>
                                     means energy furnished to a covered military installation in any form and for any purpose, including heating, cooling, and electricity.
                                </P>
                                <P>
                                    <E T="03">Main operating base</E>
                                     means a facility outside the United States and its territories with permanently stationed operating forces and robust infrastructure.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Prohibition.</E>
                                     In accordance with section 2821 of the National Defense Authorization Act for Fiscal Year 2020 (Pub. L. 116-92), the Contractor shall not use in the performance of this contract any energy sourced from inside the Russian Federation as a means of generating the furnished energy for the covered military installation unless a waiver is approved. The prohibition—
                                </P>
                                <P>(1) Applies to all forms of energy that are furnished to a covered military installation; and</P>
                                <P>(2) Does not apply to energy converted by a third party into another form of energy and not directly delivered to a covered military installation.</P>
                                <P>
                                    (c) 
                                    <E T="03">Subcontracts.</E>
                                     The Contractor shall insert the substance of this clause, including this paragraph (c), in subcontracts and other commercial instruments that are for furnished energy at a covered military installation, including subcontracts and commercial instruments for commercial products .
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[86 FR 48339, Aug. 30, 2021, as amended at 88 FR 6593, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7055</SECTNO>
                            <SUBJECT>Representation Regarding Business Operations with the Maduro Regime.</SUBJECT>
                            <P>As prescribed in 225.7020-5(a), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Representation Regarding Business Operations With the Maduro Regime (MAY 2022)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this provision—
                                </P>
                                <P>
                                    <E T="03">Agency or instrumentality of the government of Venezuela, business operations, government of Venezuela,</E>
                                     and 
                                    <E T="03">person</E>
                                     have the meaning given in the clause 252.225-7056, Prohibition Regarding Business Operations with the Maduro Regime, of this solicitation.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Prohibition.</E>
                                     In accordance with section 890 of the National Defense Authorization Act for Fiscal Year 2020 (Pub. L. 116-92), DoD is prohibited from entering into a contract for the procurement of products or services with any person that has business operations with an authority of the government of Venezuela that is not recognized as the legitimate government of Venezuela by the U.S. Government, unless the person has a valid license to operate in Venezuela issued by the Office of Foreign Assets Control of the Department of the Treasury.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Representation.</E>
                                     By submission of its offer, the Offeror represents that the Offeror is a person that—
                                </P>
                                <P>(1) Does not have any business operations with an authority of the Maduro regime or the government of Venezuela that is not recognized as the legitimate government of Venezuela by the U.S. Government; or</P>
                                <P>(2) Has a valid license to operate in Venezuela issued by the Office of Foreign Assets Control of the Department of the Treasury.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[87 FR 31961, May 26, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7056</SECTNO>
                            <SUBJECT>Prohibition Regarding Business Operations with the Maduro Regime.</SUBJECT>
                            <P>As prescribed in 225.7020-5(b), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Prohibition Regarding Business Operations With the Maduro Regime (JAN 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Agency or instrumentality of the government of Venezuela</E>
                                     means an agency or instrumentality of a foreign state as defined in 28 U.S.C. 1603(b), with each reference in section 1603(b) to a foreign state deemed to be a reference to Venezuela.
                                </P>
                                <P>
                                    <E T="03">Business operations</E>
                                     means engaging in commerce in any form, including acquiring, developing, maintaining, owning, selling, possessing, leasing, or operating equipment, facilities, personnel, products, services, personal property, real property, or any other apparatus of business or commerce.
                                </P>
                                <P>
                                    <E T="03">Government of Venezuela</E>
                                     means the government of any political subdivision of Venezuela, and any agency or instrumentality of the government of Venezuela.
                                </P>
                                <P>
                                    <E T="03">Person</E>
                                     means—
                                </P>
                                <P>(1) A natural person, corporation, company, business association, partnership, society, trust, or any other nongovernmental entity, organization, or group;</P>
                                <P>
                                    (2) Any governmental entity or instrumentality of a government, including a multilateral development institution (as defined in 
                                    <PRTPAGE P="621"/>
                                    section 1701(c)(3) of the International Financial Institutions Act (22 U.S.C. 262r(c)(3)); and
                                </P>
                                <P>(3) Any successor, subunit, parent entity, or subsidiary of, or any entity under common ownership or control with, any entity described in paragraph (1) or (2) of this definition.</P>
                                <P>
                                    (b) 
                                    <E T="03">Prohibition.</E>
                                     In accordance with section 890 of the National Defense Authorization Act for Fiscal Year 2020 (Pub. L. 116-92), DoD is prohibited from entering into a contract for the procurement of products or services with any person that has business operations with an authority of the government of Venezuela that is not recognized as the legitimate government of Venezuela by the U.S. Government, unless the person has a valid license to operate in Venezuela issued by the Office of Foreign Assets Control of the Department of the Treasury.
                                </P>
                                <P>(c) The Contractor shall—</P>
                                <P>(1) Not have any business operations with an authority of the Maduro regime or the government of Venezuela that is not recognized as the legitimate government of Venezuela by the U.S. Government; or</P>
                                <P>(2) Have a valid license to operate in Venezuela issued by the Office of Foreign Assets Control of the Department of the Treasury.</P>
                                <P>
                                    (d) 
                                    <E T="03">Subcontracts.</E>
                                     The Contractor shall insert the substance of this clause, including this paragraph (d), in all subcontracts, including subcontracts for the acquisition of commercial products.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[87 FR 31961, May 26, 2022, as amended at 88 FR 6593, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7057</SECTNO>
                            <SUBJECT>Preaward Disclosure of Employment of Individuals Who Work in the People's Republic of China.</SUBJECT>
                            <P>As prescribed in 225.7021-4(a), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Preaward Disclosure of Employment of Individuals Who Work in the People's Republic of China (Aug 2022)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this provision—
                                </P>
                                <P>
                                    <E T="03">Covered contract</E>
                                     and 
                                    <E T="03">covered entity</E>
                                     have the meaning given in the clause 252.225-7058, Postaward Disclosure of Employment of Individuals Who Work in the People's Republic of China.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Prohibition on award.</E>
                                     In accordance with section 855 of the National Defense Authorization Act for Fiscal Year 2022 (Pub. L. 117-81, 10 U.S.C. 4651 note prec.), DoD may not award a contract to the Offeror if it is a covered entity and proposes to employ one or more individuals who will perform work in the People's Republic of China on a covered contract, unless the Offeror has disclosed its use of workforce and facilities in the People's Republic of China.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Preaward disclosure requirement.</E>
                                     At the time of submission of an offer for a covered contract, an Offeror that is a covered entity shall provide disclosures to include—
                                </P>
                                <P>(1) The proposed use of workforce on a covered contract or subcontract, if the Offeror employs one or more individuals who perform work in the People's Republic of China;</P>
                                <P>(2) The total number of such individuals who will perform work in the People's Republic of China; and</P>
                                <P>(3) A description of the physical presence, including street address or addresses, in the People's Republic of China, where work on the covered contract will be performed.</P>
                            </EXTRACT>
                            <FP>(End of provision)</FP>
                            <CITA>[87 FR 52342, Aug. 25, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7058</SECTNO>
                            <SUBJECT>Postaward Disclosure of Employment of Individuals Who Work in the People's Republic of China.</SUBJECT>
                            <P>As prescribed in 225.7021-4(b), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Postaward Disclosure of Employment of Individuals Who Work In the People's Republic of China (JAN 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Covered contract</E>
                                     means any DoD contract or subcontract with a value in excess of $5 million, not including contracts for commercial products and commercial services.
                                </P>
                                <P>
                                    <E T="03">Covered entity</E>
                                     means any corporation, company, limited liability company, limited partnership, business trust, business association, or other similar entity, including any subsidiary thereof, performing work on a covered contract in the People's Republic of China, including by leasing or owning real property used in the performance of the covered contract in the People's Republic of China.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Disclosure requirement.</E>
                                     (1) In accordance with section 855 of the National Defense Authorization Act for Fiscal Year 2022 (Pub. L. 117-81, 10 U.S.C. 4651 note prec.), DoD may not award, extend, or exercise an option on a covered contract with a covered entity unless such covered entity submits each required disclosure of its use of workforce and facilities in the People's Republic of China, if it employs one or more individuals who perform work in the People's Republic of China on a covered contract.
                                </P>
                                <P>
                                    (2) If the Contractor is a covered entity, the Contractor shall disclose for the Government's fiscal years 2023 and 2024, the Contractor's employment of one or more individuals who perform work in the People's Republic of China on any covered contract. The disclosures shall include—
                                    <PRTPAGE P="622"/>
                                </P>
                                <P>(i) The total number of such individuals who perform work in the People's Republic of China on the covered contracts funded by DoD; and</P>
                                <P>(ii) A description of the physical presence, including street address or addresses in the People's Republic of China, where work on the covered contract is performed.</P>
                                <P>
                                    (c) 
                                    <E T="03">Subcontracts.</E>
                                     The Contractor shall insert this clause, including this paragraph (c), without alteration other than to identify the appropriate parties, in all subcontracts that meet the definition of a covered contract.
                                </P>
                            </EXTRACT>
                            <FP>(End of clause)</FP>
                            <CITA>[87 FR 52342, Aug. 25, 2022, as amended at 88 FR 6593, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7059</SECTNO>
                            <SUBJECT>Prohibition on Certain Procurements from the Xinjiang Uyghur Autonomous Region-Representation.</SUBJECT>
                            <P>As prescribed in 225.7022-5(a), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Prohibition on Certain Procurements From the Xinjiang Uyghur Autonomous Region—Representation (Jun 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     
                                    <E T="03">Forced labor,</E>
                                     and 
                                    <E T="03">XUAR,</E>
                                     as used in this provision, have the meaning given in the 252.225-7060, Prohibition on Certain Procurements from the Xinjiang Uyghur Autonomous Region, clause of this solicitation.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Prohibition.</E>
                                     DoD may not knowingly procure any products mined, produced, or manufactured wholly or in part by forced labor from XUAR or from an entity that has used labor from within or transferred from XUAR as part of any forced labor programs, as specified in paragraph (b) of the 252.225-7060, Prohibition on certain procurements from the Xinjiang Uyghur Autonomous Region, clause of this solicitation.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Representation.</E>
                                     By submission of its offer, the Offeror represents that it has made a good faith effort to determine that forced labor from XUAR will not be used in the performance of a contract resulting from this solicitation.
                                </P>
                            </EXTRACT>
                            <FP SOURCE="FP-1">(End of provision)</FP>
                            <CITA>[87 FR 76984, Dec. 16, 2022, as amended at 88 FR 37797, June 9, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7060</SECTNO>
                            <SUBJECT>Prohibition on Certain Procurements from the Xinjiang Uyghur Autonomous Region.</SUBJECT>
                            <P>As prescribed in 225.7022-5(b), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD2">Prohibition on Certain Procurements From the Xinjiang Uyghur Autonomous Region (Jun 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Forced labor</E>
                                     means any work or service that is exacted from any person under the menace of any penalty for nonperformance and that the worker does not offer to perform (10 U.S.C. 2496).
                                </P>
                                <P>
                                    <E T="03">XUAR</E>
                                     means the Xinjiang Uyghur Autonomous Region of the People's Republic of China (10 U.S.C. 2496).
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Prohibition.</E>
                                     In accordance with 10 U.S.C. 4661, none of the funds appropriated or otherwise made available for DoD may be used to knowingly procure any products mined, produced, or manufactured wholly or in part by forced labor from XUAR or from an entity that has used labor from within or transferred from XUAR. The Contractor shall make a good faith effort to determine that forced labor from XUAR will not be used in the performance of this contract (section 855, Pub. L. 117-263).
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Subcontracts.</E>
                                     The Contractor shall insert this clause, including this paragraph (c), without alteration other than to identify the appropriate parties, in subcontracts including subcontracts for commercial products, commercial services, and commercially available off-the-shelf items.
                                </P>
                            </EXTRACT>
                            <FP SOURCE="FP-1">(End of clause)</FP>
                            <CITA>[87 FR 76984, Dec. 16, 2022, as amended at 88 FR 6593, Jan. 31, 2023; 88 FR 37797, June 9, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7061</SECTNO>
                            <SUBJECT>Restriction on the Acquisition of Personal Protective Equipment and Certain Other Items from Non-Allied Foreign Nations.</SUBJECT>
                            <P>As prescribed in 225.7023-4, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Restriction on the Acquisition of Personal Protective Equipment and Certain Other Items From Non-Allied Foreign Nations (JAN 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Covered country</E>
                                     means—
                                </P>
                                <P>(1) The Democratic People's Republic of North Korea;</P>
                                <P>(2) The People's Republic of China;</P>
                                <P>(3) The Russian Federation; and</P>
                                <P>(4) The Islamic Republic of Iran.</P>
                                <P>
                                    <E T="03">Covered item</E>
                                     means an article or item of—
                                </P>
                                <P>(1) Personal protective equipment for use in preventing spread of disease, such as by exposure to infected individuals or contamination or infection by infectious material, including—</P>
                                <P>(i) Nitrile and vinyl gloves;</P>
                                <P>(ii) Surgical masks;</P>
                                <P>(iii) Respirator masks and powered air purifying respirators and required filters;</P>
                                <P>(iv) Face shields and protective eyewear;</P>
                                <P>(v) Surgical and isolation gowns and head and foot coverings; or</P>
                                <P>
                                    (vi) Clothing; and
                                    <PRTPAGE P="623"/>
                                </P>
                                <P>(vii) The materials and components thereof, other than sensors, electronics, or other items added to and not normally associated with such personal protective equipment or clothing; or</P>
                                <P>(2) Sanitizing and disinfecting wipes, testing swabs, gauze, and bandages.</P>
                                <P>
                                    (b) 
                                    <E T="03">Restriction.</E>
                                     The Contractor shall not deliver under this contract a covered item from a covered country (10 U.S.C. 4875).
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Subcontracts.</E>
                                     The Contractor shall insert this clause, including this paragraph (c), without alteration other than to identify the appropriate parties, in subcontracts valued above $150,000 that are for the acquisition of covered items, including subcontracts for commercial products, including commercially available off-the-shelf items, and commercial services.
                                </P>
                            </EXTRACT>
                            <P>(End of clause)</P>
                            <CITA>[88 FR 6603, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7062</SECTNO>
                            <SUBJECT>Restriction on Acquisition of Large Medium-Speed Diesel Engines.</SUBJECT>
                            <P>As prescribed in 225.7004-7(b), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Restriction on Acquisition of Large Medium-Speed Diesel Engines (Jul 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Large medium-speed diesel engines</E>
                                     means diesel engines whose revolutions per minute (RPM) fall between 300 and 1500 RPM with a displacement greater than 1500 cubic inches per cylinder.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Restriction.</E>
                                     As required by 10 U.S.C. 4864, the Contractor shall deliver under this contract large medium-speed diesel engines manufactured in the United States, Australia, Canada, New Zealand, or the United Kingdom.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Subcontracts.</E>
                                     The Contractor shall include the substance of this clause, including this paragraph (c), in subcontracts that exceed the simplified acquisition threshold, including subcontracts for commercial products and commercial services, that require large medium-speed diesel engines for new construction of auxiliary ships.
                                </P>
                            </EXTRACT>
                            <FP>(End of clause)</FP>
                            <CITA>[88 FR 46903, July 20, 2023, as amended at 89 FR 46816, May 30, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7063</SECTNO>
                            <SUBJECT>Restriction on Acquisition of Components of T-AO 205 and T-ARC Class Vessels.</SUBJECT>
                            <P>As prescribed in 225.7004-7(c), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Restriction on Acquisition of Components of T-AO 205 AND T-ARC Class Vessels (MAY 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Restriction.</E>
                                </P>
                                <P>(1) In accordance with 10 U.S.C. 4864, the following components of T-AO 205 and T-ARC class vessels must be manufactured in the United States, Australia, Canada, New Zealand, or the United Kingdom of Great Britain and Northern Ireland (United Kingdom):</P>
                                <P>(i) Auxiliary equipment, including pumps, for all shipboard services.</P>
                                <P>(ii) Propulsion system components, including engines, reduction gears, and propellers.</P>
                                <P>(iii) Shipboard cranes.</P>
                                <P>(iv) Spreaders for shipboard cranes.</P>
                                <P>(2) The Contractor shall deliver under this contract only T-AO 205 and T-ARC class vessel components, as described in paragraph (a)(1) of this clause, manufactured in the United States, Australia, Canada, New Zealand, or the United Kingdom (10 U.S.C. 4864).</P>
                                <P>
                                    (b) 
                                    <E T="03">Subcontracts.</E>
                                     The Contractor shall insert the substance of this clause, including this paragraph (b), in subcontracts for the components described in paragraph (a)(1) of this clause that exceed the simplified acquisition threshold, including subcontracts for commercial products and commercial services.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of Clause)</HD>
                            <CITA>[89 FR 46816, May 30, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7064</SECTNO>
                            <SUBJECT>Restriction on Acquisition of Certain Satellite Components.</SUBJECT>
                            <P>As prescribed in 225.7004-7(d), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Restriction On Acquisition of Certain Satellite Components (MAY 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Star tracker</E>
                                     means a navigational tool used in a satellite weighing more than 400 pounds whose principal purpose is to support the national security, defense, or intelligence needs of the U.S. Government.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Restriction.</E>
                                     In accordance with 10 U.S.C. 4864, a star tracker must be manufactured in the United States, Australia, Canada, New Zealand, or the United Kingdom of Great Britain and Northern Ireland (United Kingdom). The Contractor shall deliver under this contract only star trackers manufactured in the United States, Australia, Canada, New Zealand, or the United Kingdom.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Subcontracts.</E>
                                     The Contractor shall insert the substance of this clause, including this paragraph (c), in subcontracts for star trackers that exceed the simplified acquisition threshold, including subcontracts for 
                                    <PRTPAGE P="624"/>
                                    commercial products and commercial services.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[89 FR 46816, May 30, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.225-7065</SECTNO>
                            <SUBJECT>Restriction on Acquisition of Fuel for Overseas Contingency Operations.</SUBJECT>
                            <P>As prescribed in 225.7024-4, use the following provision:</P>
                            <HD SOURCE="HD1">Restriction on Acquisition of Fuel for Overseas Contingency Operations (Oct 2024)</HD>
                            <EXTRACT>
                                <P>
                                    (a) 
                                    <E T="03">Prohibition.</E>
                                     For an overseas contingency operation, DoD may not procure fuel in whole or in part, or derivatives of such fuel, that is sourced from nations or regions prohibited from selling petroleum to the United States. See Federal Acquisition Regulation subpart 25.7 and the Office of Foreign Assets Control website at 
                                    <E T="03">https://ofac.treasury.gov/sanctions-programs-and-country-information</E>
                                     for prohibited sources.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Certification.</E>
                                     Offerors shall complete the certification in paragraph (b)(1) of this provision and submit the certification with their offer.
                                </P>
                                <P>(1) The Offeror does [ ] does not [ ] certify that the fuel, in whole or in part, or derivatives of such fuel, to be provided under any contract resulting from this solicitation is not sourced from a nation or region prohibited from selling petroleum to the United States.</P>
                                <P>(2) Only Offerors who certify that the fuel to be provided is not sourced from a prohibited nation or region will be eligible for award.</P>
                                <P>
                                    (c) 
                                    <E T="03">Compliance.</E>
                                </P>
                                <P>(1) When requested by the Contracting Officer, the prospective Contractor shall submit records necessary to demonstrate compliance with applicable laws and regulations regarding export-controlled items and anticorruption statutes and regulations including—</P>
                                <P>
                                    (i) The Foreign Corrupt Practices Act (15 U.S.C. 78dd-1 
                                    <E T="03">et seq.</E>
                                    );
                                </P>
                                <P>(ii) International Traffic in Arms Regulations (ITAR) at 22 CFR parts 120 through 130 (also see Defense Federal Acquisition Regulation Supplement (DFARS) clause 252.225-7048, Export-Controlled Items);</P>
                                <P>(iii) Export Administration Regulations (EAR) at 15 CFR parts 730 through 774 (also see DFARS clause 252.225-7048); and</P>
                                <P>
                                    (iv) Relevant regulations promulgated by the Office of Foreign Assets Control of the Department of the Treasury. Sanction information for specific countries and programs is available at 
                                    <E T="03">https://ofac.treasury.gov/sanctions-programs-and-country-information.</E>
                                </P>
                                <P>(2) The Offeror shall contact the Department of State regarding ITAR compliance and the Department of Commerce regarding EAR compliance.</P>
                                <P>
                                    (d) 
                                    <E T="03">Reporting requirement.</E>
                                     The Offeror shall, prior to contract award, promptly report to the Contracting Officer any instance of unsupported denial of access to a facility or equipment by a host-nation government that may prevent it from complying with the terms and conditions of the solicitation.
                                </P>
                            </EXTRACT>
                            <FP>(End of provision)</FP>
                            <CITA>[89 FR 78999, Sept. 26, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.226-7001</SECTNO>
                            <SUBJECT>Utilization of Indian Organizations, Indian-Owned Economic Enterprises, and Native Hawaiian Small Business Concerns.</SUBJECT>
                            <P>As prescribed in 226.104, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Utilization of Indian Organizations, Indian-Owned Economic Enterprises, and Native Hawaiian Small Business Concerns (JAN 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Indian</E>
                                     means—
                                </P>
                                <P>(1) Any person who is a member of any Indian tribe, band, group, pueblo, or community that is recognized by the Federal Government as eligible for services from the Bureau of Indian Affairs (BIA) in accordance with 25 U.S.C. 1452(c); and</P>
                                <P>
                                    (2) Any “Native” as defined in the Alaska Native Claims Settlement Act (43 U.S.C. 1601 
                                    <E T="03">et seq.</E>
                                    ).
                                </P>
                                <P>
                                    <E T="03">Indian organization</E>
                                     means the governing body of any Indian tribe or entity established or recognized by the governing body of an Indian tribe for the purposes of 25 U.S.C. chapter 17.
                                </P>
                                <P>
                                    <E T="03">Indian-owned economic enterprise</E>
                                     means any Indian-owned (as determined by the Secretary of the Interior) commercial, industrial, or business activity established or organized for the purpose of profit, provided that Indian ownership constitutes not less than 51 percent of the enterprise.
                                </P>
                                <P>
                                    <E T="03">Indian tribe</E>
                                     means any Indian tribe, band, group, pueblo, or community, including native villages and native groups (including corporations organized by Kenai, Juneau, Sitka, and Kodiak) as defined in the Alaska Native Claims Settlement Act, that is recognized by the Federal Government as eligible for services from BIA in accordance with 25 U.S.C. 1452(c).
                                </P>
                                <P>
                                    <E T="03">Interested party</E>
                                     means a contractor or an actual or prospective offeror whose direct economic interest would be affected by the award of a subcontract or by the failure to award a subcontract.
                                </P>
                                <P>
                                    <E T="03">Native Hawaiian small business concern</E>
                                     means an entity that is—
                                    <PRTPAGE P="625"/>
                                </P>
                                <P>(1) A small business concern as defined in section 3 of the Small Business Act (15 U.S.C. 632) and relevant implementing regulations; and</P>
                                <P>(2) Owned and controlled by a Native Hawaiian as defined in 25 U.S.C. 4221(9).</P>
                                <P>(b) The Contractor shall use its best efforts to give Indian organizations, Indian-owned economic enterprises, and Native Hawaiian small business concerns the maximum practicable opportunity to participate in the subcontracts it awards, to the fullest extent consistent with efficient performance of the contract.</P>
                                <P>(c) The Contracting Officer and the Contractor, acting in good faith, may rely on the representation of an Indian organization, Indian-owned economic enterprise, or Native Hawaiian small business concern as to its eligibility, unless an interested party challenges its status or the Contracting Officer has independent reason to question that status.</P>
                                <P>(d) In the event of a challenge to the representation of a subcontractor, the Contracting Officer will refer the matter to—</P>
                                <P>(1)(i) For matters relating to Indian organizations or Indian-owned economic enterprises:</P>
                                <P>
                                    U.S. Department of the Interior, Bureau of Indian Affairs, Attn: Bureau Procurement Chief, 12220 Sunrise Valley Drive, Reston, VA 20191, Phone: 703-390-6433, Website: 
                                    <E T="03">https://www.bia.gov/</E>
                                    .
                                </P>
                                <P>(ii) The BIA will determine the eligibility and will notify the Contracting Officer.</P>
                                <P>(2)(i) For matters relating to Native Hawaiian small business concerns:</P>
                                <P>
                                    Department of Hawaiian Home Lands, P.O. Box 1879, Honolulu, HI 96805, Phone: 808-620-9500, Website: 
                                    <E T="03">http://dhhl.hawaii.gov/</E>
                                    .
                                </P>
                                <P>(ii) The Department of Hawaiian Home Lands will determine the eligibility and will notify the Contracting Officer.</P>
                                <P>(e) No incentive payment will be made—</P>
                                <P>(1) While a challenge is pending; or</P>
                                <P>(2) If a subcontractor is determined to be an ineligible participant.</P>
                                <P>(f)(1) The Contractor, on its own behalf or on behalf of a subcontractor at any tier, may request an incentive payment in accordance with this clause.</P>
                                <P>(2) The incentive amount that may be requested is 5 percent of the estimated cost, target cost, or fixed price included in the subcontract at the time of award to the Indian organization, Indian-owned economic enterprise, or Native Hawaiian small business concern.</P>
                                <P>(3) In the case of a subcontract for commercial products or commercial services, the Contractor may receive an incentive payment only if the subcontracted items are produced or manufactured in whole or in part by an Indian organization, Indian-owned economic enterprise, or Native Hawaiian small business concern.</P>
                                <P>(4) The Contractor has the burden of proving the amount claimed and shall assert its request for an incentive payment prior to completion of contract performance.</P>
                                <P>(5) The Contracting Officer, subject to the terms and conditions of the contract and the availability of funds, will authorize an incentive payment of 5 percent of the estimated cost, target cost, or fixed price included in the subcontract awarded to the Indian organization, Indian-owned economic enterprise, or Native Hawaiian small business concern.</P>
                                <P>(6) If the Contractor requests and receives an incentive payment on behalf of a subcontractor, the Contractor is obligated to pay the subcontractor the incentive amount.</P>
                                <P>(g) The Contractor shall insert the substance of this clause, including this paragraph (g), in all subcontracts exceeding $500,000.</P>
                            </EXTRACT>
                            <CITA>[68 FR 56562, Oct. 1, 2003, as amended at 69 FR 55991, Sept. 17, 2004; 84 FR 12142, Apr. 1, 2019; 88 FR 6593, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.226-7002</SECTNO>
                            <SUBJECT>Representation for Demonstration Project for Contractors Employing Persons with Disabilities.</SUBJECT>
                            <P>As prescribed in 226.7203, use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Representation for Demonstration Project for Contractors Employing Persons With Disabilities (DEC 2019)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this provision—
                                </P>
                                <P>
                                    <E T="03">Eligible contractor</E>
                                     means a business entity operated on a for-profit or nonprofit basis that—
                                </P>
                                <P>(1) Employs severely disabled individuals at a rate that averages not less than 33 percent of its total workforce over the 12-month period prior to issuance of the solicitation;</P>
                                <P>(2) Pays not less than the minimum wage prescribed pursuant to 29 U.S.C. 206 to the employees who are severely disabled individuals; and</P>
                                <P>(3) Provides, for its employees, health insurance and a retirement plan comparable to those provided for employees by business entities of similar size in its industrial sector or geographic region.</P>
                                <P>
                                    <E T="03">Severely disabled individual</E>
                                     means an individual with a disability (as defined in 42 U.S.C. 12102) who has a severe physical or mental impairment that seriously limits one or more functional capacities.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Demonstration Project.</E>
                                     This solicitation is issued pursuant to the Demonstration Project for Contractors Employing Persons 
                                    <PRTPAGE P="626"/>
                                    with Disabilities. The purpose of the Demonstration Project is to provide defense contracting opportunities for entities that employ severely disabled individuals. To be eligible for award, an offeror must be an eligible contractor as defined in paragraph (a) of this provision.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Representation.</E>
                                     The offeror represents that it [] is [] is not an eligible contractor as defined in paragraph (a) of this provision.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[84 FR 72561, Dec. 31, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.226-7003</SECTNO>
                            <SUBJECT>Drug-Free Work Force.</SUBJECT>
                            <P>As prescribed in 226.570-2, use the following clause:</P>
                            <HD SOURCE="HD1">Drug-Free Work Force (Aug 2024)</HD>
                            <P>
                                (a) 
                                <E T="03">Definitions.</E>
                                 As used in this clause—
                            </P>
                            <P>
                                <E T="03">Employee in a sensitive position</E>
                                 means an employee who has been granted access to classified information; or employees in other positions that the Contractor determines involve national security, health or safety, or functions other than the foregoing requiring a high degree of trust and confidence.
                            </P>
                            <P>
                                <E T="03">Illegal drugs</E>
                                 means controlled substances included in Schedules I and II, as defined by section 802(6) of title 21 of the United States Code, the possession of which is unlawful under chapter 13 of that title. The term “illegal drugs” does not mean the use of a controlled substance pursuant to a valid prescription or other uses authorized by law.
                            </P>
                            <P>(b) The Contractor agrees to institute and maintain a program for achieving the objective of a drug-free work force. While this clause defines criteria for such a program, contractors are encouraged to implement alternative approaches comparable to the criteria in paragraph (c) that are designed to achieve the objectives of this clause.</P>
                            <P>(c) Contractor programs shall include the following, or appropriate alternatives:</P>
                            <P>(1) Employee assistance programs emphasizing high level direction, education, counseling, rehabilitation, and coordination with available community resources;</P>
                            <P>(2) Supervisory training to assist in identifying and addressing illegal drug use by Contractor employees;</P>
                            <P>(3) Provision for self-referrals as well as supervisory referrals to treatment with maximum respect for individual confidentiality consistent with safety and security issues;</P>
                            <P>(4) Provision for identifying illegal drug users, including testing on a controlled and carefully monitored basis. Employee drug testing programs shall be established taking account of the following:</P>
                            <P>(i) The Contractor shall establish a program that provides for testing for the use of illegal drugs by employees in sensitive positions. The extent of and criteria for such testing shall be determined by the Contractor based on considerations that include the nature of the work being performed under the contract, the employee's duties, the efficient use of Contractor resources, and the risks to health, safety, or national security that could result from the failure of an employee adequately to discharge his or her position.</P>
                            <P>(ii) In addition, the Contractor may establish a program for employee drug testing—</P>
                            <P>(A) When there is a reasonable suspicion that an employee uses illegal drugs; or</P>
                            <P>(B) When an employee has been involved in an accident or unsafe practice;</P>
                            <P>(C) As part of or as a follow-up to counseling or rehabilitation for illegal drug use;</P>
                            <P>(D) As part of a voluntary employee drug testing program.</P>
                            <P>(iii) The Contractor may establish a program to test applicants for employment for illegal drug use.</P>
                            <P>(iv) For the purpose of administering this clause, testing for illegal drugs may be limited to those substances for which testing is prescribed by section 2.1 of subpart B of the “Mandatory Guidelines for Federal Workplace Drug Testing Programs” (53 FR 11980 (April 11 1988)), issued by the Department of Health and Human Services.</P>
                            <P>
                                (d) Contractors shall adopt appropriate personnel procedures to deal with employees who are found to be using drugs illegally. Contractors shall not allow any employee to remain on 
                                <PRTPAGE P="627"/>
                                duty or perform in a sensitive position who is found to use illegal drugs until such times as the Contractor, in accordance with procedures established by the Contractor, determines that the employee may perform in such a position.
                            </P>
                            <P>(e) The provisions of this clause pertaining to drug testing program shall not apply to the extent they are inconsistent with state or local law, or with an existing collective bargaining agreement; provided that with respect to the latter, the Contractor agrees that those issues that are in conflict will be a subject of negotiation at the next collective bargaining session.</P>
                            <FP>(End of clause)</FP>
                            <CITA>[89 FR 66284, Aug. 15, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7000</SECTNO>
                            <SUBJECT>Non-estoppel.</SUBJECT>
                            <P>As prescribed at 227.7009-1, insert the following clause in patent releases, license agreements, and assignments:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Non-Estoppel (OCT 1966)</HD>
                                <P>The Government reserves the right at any time to contest the enforceability, validity, scope of, or the title to any patent or patent application herein licensed without waiving or forfeiting any right under this contract.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7001</SECTNO>
                            <SUBJECT>Release of past infringement.</SUBJECT>
                            <P>As prescribed at 227.7009-2(a), insert the following clause in patent releases, license agreements, and assignments:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Release of Past Infringement (SEP 2019)</HD>
                                <P>
                                    The Contractor hereby releases each and every claim and demand which the Contractor now has or may hereafter have against the Government for the manufacture or use by or for the Government prior to the effective date of this contract, of any inventions covered by (i) any of the patents and applications for patent identified in this contract, and (ii) any other patent or application for patent owned or hereafter acquired by the Contractor, insofar as and only to the extent that such other patent or patent application covers the manufacture, use, or disposition of [description of subject matter].*
                                    <FTREF/>
                                </P>
                                <FTNT>
                                    <P>*Bracketed portions of the clause may be omitted when not appropriate or not encompassed by the release as negotiated.</P>
                                </FTNT>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 84 FR 48500, Sept. 13, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7002</SECTNO>
                            <SUBJECT>Readjustment of payments.</SUBJECT>
                            <P>As prescribed at 227.7009-2(b), insert the following clause in patent releases, license agreements, and assignments:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Readjustment of Payments (SEP 2019)</HD>
                                <P>(a) If any license, under substantially the same patents and authorizing substantially the same acts which are authorized under this contract, has been or shall hereafter be granted within the United States, on royalty terms which are more favorable to the licensee than those contained herein, the Government shall be entitled to the benefit of such more favorable terms with respect to all royalties accruing under this contract after the date such more favorable terms become effective, and the Contractor shall promptly notify the Contracting Officer in writing of the granting of such more favorable terms.</P>
                                <P>
                                    (b) In the event any claim of any patent hereby licensed is construed or held invalid by decision of a court of competent jurisdiction, the requirement to pay royalties under this contract insofar as its arises solely by reason of such claim, and any other claim not materially different therefrom, shall be interpreted in conformity with the court's decision as to the scope of validity of such claims; 
                                    <E T="03">Provided,</E>
                                     however, that in the event such decision is modified or reversed on appeal, the requirement to pay royalties under this contract shall be interpreted in conformity with the final decision rendered on such appeal.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[50 FR 12272, Mar. 28, 1985, as amended at 84 FR 48503, Sept. 13, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7003</SECTNO>
                            <SUBJECT>Termination.</SUBJECT>
                            <P>As prescribed at 227.7009-2(c), insert the following clause in patent releases, license agreements, and assignments:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Termination (AUG 1984)</HD>
                                <P>
                                    Notwithstanding any other provision of this contract, the Government shall have the right to terminate the within license, in whole or in part, by giving the Contractor not less than thirty (30) days notice in writing of the date such termination is to be effective; provided, however, that such termination shall not affect the obligation of the 
                                    <PRTPAGE P="628"/>
                                    Government to pay royalties which have accrued prior to the effective date of such termination.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7004</SECTNO>
                            <SUBJECT>License grant.</SUBJECT>
                            <P>As prescribed at 227.7009-3(a), insert the following clause in patent releases, license agreements, and assignments:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">License Grant (AUG 1984)</HD>
                                <P>(a) The Contractor hereby grants to the Government an irrevocable, nonexclusive, nontransferable, and paid up license under the following patents, applications for patent, and any patents granted on such applications, and under any patents which may issue as the result of any reissue, division or continuation thereof, to practice by or cause to be practiced for the Government throughout the world, any and all of the inventions thereunder, in the manufacture and use of any article or material, in the use of any method or process, and in the disposition of any article or material in accordance with law:</P>
                                <FP SOURCE="FP-DASH">U.S. Patent No.</FP>
                                <FP SOURCE="FP-DASH">Date</FP>
                                <FP SOURCE="FP-DASH">Application Serial No.</FP>
                                <FP SOURCE="FP-DASH">Filing Date</FP>
                                <FP>together with corresponding foreign patents and foreign applications for patents, insofar as the Contractor has the right to grant licenses thereunder without incurring an obligation to pay royalties or other compensation to others solely on account of such grant.</FP>
                                <P>(b) No rights are granted or implied by the agreement under any other patents other than as provided above or by operation of law.</P>
                                <P>(c) Nothing contained herein shall limit any rights which the Government may have obtained by virtue of prior contracts or by operation of law or otherwise.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7005</SECTNO>
                            <SUBJECT>License term.</SUBJECT>
                            <P>As prescribed at 227.7009-3(b), insert one of the following clauses in patent releases, license agreements, and assignments:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">License Term (OCT 2001)</HD>
                            </EXTRACT>
                            <P>
                                <E T="03">Alternate I</E>
                                 (AUG 1984). The license hereby granted shall remain in full force and effect for the full term of each of the patents referred to in the “License Grant” clause of this contract and any and all patents hereafter issued on applications for patent referred to in such “License Grant” clause.
                            </P>
                            <P>
                                <E T="03">Alternate II</E>
                                 (OCT 2001). The license hereby granted shall terminate on the ________ day of ________ ,________; 
                                <E T="03">Provided,</E>
                                 however, that said termination shall be without prejudice to the completion of any contract entered into by the Government prior to said date of termination or to the use or disposition thereafter of any articles or materials manufactured by or for the Government under this license.
                            </P>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 66 FR 49861, Oct. 1, 2001]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7006</SECTNO>
                            <SUBJECT>License grant—running royalty.</SUBJECT>
                            <P>As prescribed at 227.7009-4(a), insert the following clause in patent releases, license agreements, and assignments:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">License Grant—Running Royalty (AUG 1984)</HD>
                                <P>(a) The Contractor hereby grants to the Government, as represented by the Secretary of __________, an irrevocable, nonexclusive, nontransferable license under the following patents, applications for patent, and any patents granted on such applications, and under any patents which may issue as the result of any reissue, division, or continuation thereunder to practice by or cause to be practiced for the Department of ________, throughout the world, any and all of the inventions thereunder in the manufacture and use of any article or material, in the use of any method or process, and in the disposition of any article or material in accordance with law:</P>
                                <FP SOURCE="FP-DASH">U.S. Patent No.</FP>
                                <FP SOURCE="FP-DASH">Date</FP>
                                <FP SOURCE="FP-DASH">Application Serial No.</FP>
                                <FP SOURCE="FP-DASH">Filing Date</FP>
                                <FP>together with corresponding foreign patents and foreign applications for patent, insofar as the Contractor has the right to grant licenses thereunder without incurring an obligation to pay royalties or other compensation to others solely on account of such grant.</FP>
                                <P>(b) No rights are granted or implied by the agreement under any other patents other than as provided above or by operation of law.</P>
                                <P>(c) Nothing contained herein shall limit any rights which the Government may have obtained by virtue of prior contracts or by operation of law or otherwise.</P>
                            </EXTRACT>
                            <PRTPAGE P="629"/>
                            <HD SOURCE="HD3">(End of clause)</HD>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7007</SECTNO>
                            <SUBJECT>License term—running royalty.</SUBJECT>
                            <P>As prescribed at 227.7009-4(b), insert the following clause in patent releases, license agreements, and assignments:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">License Term—Running Royalty (AUG 1984)</HD>
                                <P>The license hereby granted shall remain in full force and effect for the full term of each of the patents referred to in the “License Grant” clause of this contract and any and all patents hereafter issued on applications for patent referred to above unless sooner terminated as elsewhere herein provided.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7008</SECTNO>
                            <SUBJECT>Computation of royalties.</SUBJECT>
                            <P>As prescribed at 227.7009-4(c), insert the following clause in patent releases, license agreements, and assignments:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Computation of Royalties (AUG 1984)</HD>
                                <P>
                                    Subject to the conditions hereinafter stated, royalties shall accrue to the Contractor under this agreement on all articles or materials embodying, or manufactured by the use of, any or all inventions claimed under any unexpired United States patent licensed herein, upon acceptance thereof by the Department of ____________, at the rate of ________ percent of the net selling price of such articles or materials (amount) per (name of item) *
                                    <FTREF/>
                                     whether manufactured by the Government or procured under a fixed price contract, and at the rate of (amount) per (name of item) acquired or manufactured by a Contractor performing under a cost-reimbursement contract. With respect to such articles or materials made by the Department of ____________, “net selling price,” as used in this paragraph, means the actual cost of direct labor and materials without allowance for overhead and supervision.
                                </P>
                                <FTNT>
                                    <P>* Use bracketed matter as appropriate.</P>
                                </FTNT>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7009</SECTNO>
                            <SUBJECT>Reporting and payment of royalties.</SUBJECT>
                            <P>As prescribed at 227.7009-4(d), insert the following clause in patent releases, license agreements, and assignments:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Reporting and Payment of Royalties (SEP 2019)</HD>
                                <P>
                                    (a) The 
                                    <E T="03">[insert the Contracting Officer or the name of the designated office, in accordance with agency procedures]</E>
                                     shall, on or before the sixtieth (60th) day next following the end of each yearly*
                                    <FTREF/>
                                     period ending ____________ during which royalties have accrued under this license, deliver to the Contractor, subject to military security regulations, a report in writing furnishing necessary information relative to royalties which have accrued under this contract.
                                </P>
                                <FTNT>
                                    <P>* The frequency, date, and length of reporting periods should be selected as appropriate to the particular circumstances of the contract.</P>
                                </FTNT>
                                <P>
                                    (b) Royalties which have accrued under this contract during the yearly* period ending ____________ shall be paid to the Contractor (if appropriations therefor are available or become available) within sixty (60) days next following the receipt of a voucher from the Contractor submitted in accordance with the report referred to in (a) of this clause; 
                                    <E T="03">Provided,</E>
                                     that the Government shall not be obligated to pay, in respect of any such yearly period, on account of the combined royalties accruing under this contract directly and under any separate licenses granted pursuant to the “License to Other Government Agencies” clause (if any) of this contract, an amount greater than ____________ dollars ($____________), and if such combined royalties exceed the said maximum yearly obligation, each department or agency shall pay a pro rata share of the said maximum yearly obligation as determined by the proportion its accrued royalties bear to the combined total of accrued royalties.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[50 FR 12272, Mar. 28, 1985, as amended at 84 FR 48504, Sept. 13, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7010</SECTNO>
                            <SUBJECT>License to other Government agencies.</SUBJECT>
                            <P>As prescribed at 227.7009-4(e), insert the following clause in patent releases, license agreements, and assignments:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">License to Other Government Agencies (AUG 1984)</HD>
                                <P>
                                    The Contractor hereby agrees to grant a separate license under the patents, applications for patents, and improvements referred to in the “License Grant” clause of this contract, on the same terms and conditions as appear in this license contract, to any other department or agency of the Government at any time on receipt of a written request for such a license from such department or agency; 
                                    <E T="03">Provided,</E>
                                     however, that as to royalties which accrue under such separate licenses, reports and payments shall be made directly to the Contractor by each such other department or agency pursuant to the terms of such separate licenses. The Contractor shall 
                                    <PRTPAGE P="630"/>
                                    notify the Licensee hereunder promptly upon receipt of any request for license hereunder.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7011</SECTNO>
                            <SUBJECT>Assignments.</SUBJECT>
                            <P>As prescribed at 227.7010, insert the following clause in assignments.</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Assignment (AUG 1984)</HD>
                                <P>The Contractor hereby conveys to the Government, as represented by the Secretary of ____________, the entire right, title, and interest in and to the following patents (and applications for patent), in and to the inventions thereof, and in and to all claims and demands whatsoever for infringement thereof heretofore accrued, the same to be held and enjoyed by the Government through its duly appointed representatives to the full end of the term of said patents (and to the full end of the terms of all patents which may be granted upon said applications for patent, or upon any division, continuation-in-part or continuation thereof):</P>
                                <FP SOURCE="FP-DASH">U.S. Patent No.</FP>
                                <FP SOURCE="FP-DASH">Date</FP>
                                <FP SOURCE="FP-DASH">Name of Inventor</FP>
                                <FP SOURCE="FP-DASH">U.S. Application Serial No.</FP>
                                <FP SOURCE="FP-DASH">Filing Date</FP>
                                <FP SOURCE="FP-DASH">Name of Inventor</FP>
                                <FP>together with corresponding foreign patents and applications for patent insofar as the Contractor has the right to assign the same.</FP>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7012</SECTNO>
                            <SUBJECT>Patent License and Release Contract.</SUBJECT>
                            <P>As prescribed at 227.7012, insert the following clause in patent releases, license agreements, and assignments:</P>
                            <EXTRACT>
                                <FP SOURCE="FP-DASH"/>
                                <FP>(Contract No.)</FP>
                                <HD SOURCE="HD1">Patent License and Release Contract (DEC 2022)</HD>
                                <P>This CONTRACT is effective as of the ____ day of [month, year], between the UNITED STATES OF AMERICA (hereinafter called the Government), and __________ (hereinafter called the Contractor), (a corporation organized and existing under the laws of the State of __________), (a partnership consisting of __________), (an individual trading as __________), of the City of __________, in the State of __________.</P>
                                <P>Whereas, the Contractor warrants that it has the right to grant the within license and release, and the Government desires to procure the same, and</P>
                                <P>Whereas, this contract is authorized by law, including 10 U.S.C. 3793.</P>
                                <P>Now Therefore, in consideration of the grant, release and agreements hereinafter recited, the parties have agreed as follows:</P>
                                <P>Article 1. License Grant.*</P>
                                <P>(Insert the clause at 252.227-7004 for a paid up license, or the clause at 252.227-7006 for a license on a running royalty basis.)</P>
                                <P>Article 2. License Term.*</P>
                                <P>(Insert the appropriate alternative clause at 252.227-7005 for a paid up license, or the clause at 252.227-7007 for a license on a running royalty basis.)</P>
                                <P>Article 3. Release of Past Infringement.</P>
                                <P>(Insert the clause at 252.227-7001.)</P>
                                <P>Article 4. Non-Estoppel.</P>
                                <P>(Insert the clause at 252.227-7000.)</P>
                                <P>Article 5. Payment.</P>
                                <P>The Contractor shall be paid the sum of ______ Dollars ($______) in full compensation for the rights herein granted and agreed to be granted. (For a license on a running royalty basis, insert the clause at 252.227-7006 in accordance with the instructions therein, and also the clause as specified at 252.227-7002 and 252.227-7009 and 252.227-7010.)</P>
                                <P>Article 6. Covenant Against Contingent Fees.</P>
                                <P>(Insert the clause at FAR 52.203-5.)</P>
                                <P>Article 7. Assignment of Claims.</P>
                                <P>(Insert the clause at FAR 52.232-23.)</P>
                                <P>Article 8. Gratuities.</P>
                                <P>(Insert the clause at FAR 52.203-3.)</P>
                                <P>Article 9. Disputes.</P>
                                <P>(Insert the clause at FAR 52.233-1.)</P>
                                <P>Article 10. Successors and Assignees.</P>
                                <P>This Agreement shall be binding upon the Contractor, its successors** and assignees, but nothing contained in this Article shall authorize an assignment of any claim against the Government otherwise than as permitted by law.</P>
                                <P>In Witness Whereof, the parties hereto have executed this contract.</P>
                                <FP>THE UNITED STATES OF AMERICA</FP>
                                <FP SOURCE="FP-DASH">By</FP>
                                <FP SOURCE="FP-DASH">Date</FP>
                                <FP>(Signature and Title of</FP>
                                <FP SOURCE="FP-DASH">Contractor Representative)</FP>
                                <FP SOURCE="FP-DASH">By</FP>
                                <FP SOURCE="FP-DASH">Date</FP>
                                <P>*If only a release is procured, delete this article; if an assignment is procured, use the clause at 252.227-7011.</P>
                                <P>**When the Contractor is an individual, change “successors” to “heirs”; if a partnership, modify appropriately.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[64 FR 49685, Sept. 14, 1999, as amended at 87 FR 76997, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="631"/>
                            <SECTNO>252.227-7013</SECTNO>
                            <SUBJECT>Rights in Technical Data—Other Than Commercial Products and Commercial Services.</SUBJECT>
                            <P>As prescribed in 227.7103-6(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Rights in Technical Data—Other Than Commercial Products or Commercial Services (MAR 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    (1) 
                                    <E T="03">Computer data base</E>
                                     means a collection of data recorded in a form capable of being processed by a computer. The term does not include computer software.
                                </P>
                                <P>
                                    (2) 
                                    <E T="03">Computer program</E>
                                     means a set of instructions, rules, or routines recorded in a form that is capable of causing a computer to perform a specific operation or series of operations.
                                </P>
                                <P>
                                    (3) 
                                    <E T="03">Computer software</E>
                                     means computer programs, source code, source code listings, object code listings, design details, algorithms, processes, flow charts, formulae and related material that would enable the software to be reproduced, recreated, or recompiled. Computer software does not include computer data bases or computer software documentation.
                                </P>
                                <P>
                                    (4) 
                                    <E T="03">Computer software documentation</E>
                                     means owner's manuals, user's manuals, installation instructions, operating instructions, and other similar items, regardless of storage medium, that explain the capabilities of the computer software or provide instructions for using the software.
                                </P>
                                <P>
                                    (5) 
                                    <E T="03">Covered Government support contractor</E>
                                     means a contractor (other than a litigation support contractor covered by 252.204-7014)under a contract, the primary purpose of which is to furnish independent and impartial advice or technical assistance directly to the Government in support of the Government's management and oversight of a program or effort (rather than to directly furnish an end item or service to accomplish a program or effort), provided that the contractor—
                                </P>
                                <P>(i) Is not affiliated with the prime contractor or a first-tier subcontractor on the program or effort, or with any direct competitor of such prime contractor or any such first-tier subcontractor in furnishing end items or services of the type developed or produced on the program or effort; and</P>
                                <P>(ii) Receives access to technical data or computer software for performance of a Government contract that contains the clause at 252.227-7025, Limitations on the Use or Disclosure of Government-Furnished Information Marked with Restrictive Legends.</P>
                                <P>
                                    (6) 
                                    <E T="03">Detailed manufacturing or process data</E>
                                     means technical data that describe the steps, sequences, and conditions of manufacturing, processing or assembly used by the manufacturer to produce an item or component or to perform a process.
                                </P>
                                <P>
                                    (7) 
                                    <E T="03">Developed</E>
                                     means that an item, component, or process exists and is workable. Thus, the item or component must have been constructed or the process practiced. Workability is generally established when the item, component, or process has been analyzed or tested sufficiently to demonstrate to reasonable people skilled in the applicable art that there is a high probability that it will operate as intended. Whether, how much, and what type of analysis or testing is required to establish workability depends on the nature of the item, component, or process, and the state of the art. To be considered “developed,” the item, component, or process need not be at the stage where it could be offered for sale or sold on the commercial market, nor must the item, component, or process be actually reduced to practice within the meaning of Title 35 of the United States Code.
                                </P>
                                <P>
                                    (8) 
                                    <E T="03">Developed exclusively at private expense</E>
                                     means development was accomplished entirely with costs charged to indirect cost pools, costs not allocated to a government contract, or any combination thereof.
                                </P>
                                <P>(i) Private expense determinations should be made at the lowest practicable level.</P>
                                <P>(ii) Under fixed-price contracts, when total costs are greater than the firm-fixed-price or ceiling price of the contract, the additional development costs necessary to complete development shall not be considered when determining whether development was at government, private, or mixed expense.</P>
                                <P>
                                    (9) 
                                    <E T="03">Developed exclusively with government funds</E>
                                     means development was not accomplished exclusively or partially at private expense.
                                </P>
                                <P>
                                    (10) 
                                    <E T="03">Developed with mixed funding</E>
                                     means development was accomplished partially with costs charged to indirect cost pools and/or costs not allocated to a government contract, and partially with costs charged directly to a government contract.
                                </P>
                                <P>
                                    (11) 
                                    <E T="03">Form, fit, and function data</E>
                                     means technical data that describes the required overall physical, functional, and performance characteristics (along with the qualification requirements, if applicable) of an item, component, or process to the extent necessary to permit identification of physically and functionally interchangeable items.
                                </P>
                                <P>
                                    (12) 
                                    <E T="03">Government purpose</E>
                                     means any activity in which the United States Government is a party, including cooperative agreements with international or multi-national defense organizations, or sales or transfers by the United States Government to foreign governments or international organizations. Government purposes include competitive procurement, but do not include the rights to use, modify, reproduce, release, perform, display, or disclose technical data for commercial purposes or authorize others to do so.
                                </P>
                                <P>
                                    (13) 
                                    <E T="03">Government purpose rights</E>
                                     means the rights to—
                                    <PRTPAGE P="632"/>
                                </P>
                                <P>(i) Use, modify, reproduce, release, perform, display, or disclose technical data within the Government without restriction; and</P>
                                <P>(ii) Release or disclose technical data outside the Government and authorize persons to whom release or disclosure has been made to use, modify, reproduce, release, perform, display, or disclose that data for United States government purposes.</P>
                                <P>
                                    (14) 
                                    <E T="03">Limited rights</E>
                                     means the rights to use, modify, reproduce, release, perform, display, or disclose technical data, in whole or in part, within the Government. The Government may not, without the written permission of the party asserting limited rights, release or disclose the technical data outside the Government, use the technical data for manufacture, or authorize the technical data to be used by another party, except that the Government may reproduce, release, or disclose such data or authorize the use or reproduction of the data by persons outside the Government if—
                                </P>
                                <P>(i) The reproduction, release, disclosure, or use is—</P>
                                <P>(A) Necessary for emergency repair and overhaul; or</P>
                                <P>(B) A release or disclosure to—</P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) A covered Government support contractor in performance of its covered Government support contract for use, modification, reproduction, performance, display, or release or disclosure to a person authorized to receive limited rights technical data; or
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) A foreign government, of technical data other than detailed manufacturing or process data, when use of such data by the foreign government is in the interest of the Government and is required for evaluational or informational purposes;
                                </P>
                                <P>(ii) The recipient of the technical data is subject to a prohibition on the further reproduction, release, disclosure, or use of the technical data; and</P>
                                <P>(iii) The contractor or subcontractor asserting the restriction is notified of such reproduction, release, disclosure, or use.</P>
                                <P>
                                    (15) 
                                    <E T="03">Technical data</E>
                                     means recorded information, regardless of the form or method of the recording, of a scientific or technical nature (including computer software documentation). The term does not include computer software or financial, administrative, cost or pricing, or management information, or information incidental to contract administration.
                                </P>
                                <P>
                                    (16) 
                                    <E T="03">Unlimited rights</E>
                                     means rights to use, modify, reproduce, perform, display, release, or disclose technical data in whole or in part, in any manner, and for any purpose whatsoever, and to have or authorize others to do so.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Rights in technical data.</E>
                                     The Contractor grants or shall obtain for the Government the following royalty free, worldwide , nonexclusive, irrevocable license rights in technical data other than computer software documentation (see the Rights in Other Than Commercial Computer Software and Other Than Commercial Computer Software Documentation clause of this contract for rights in computer software documentation):
                                </P>
                                <P>
                                    (1) 
                                    <E T="03">Unlimited rights.</E>
                                     The Government shall have unlimited rights in technical data that are—
                                </P>
                                <P>(i) Data pertaining to an item, component, or process which has been or will be developed exclusively with Government funds;</P>
                                <P>(ii) Studies, analyses, test data, or similar data produced for this contract, when the study, analysis, test, or similar work was specified as an element of performance;</P>
                                <P>(iii) Created exclusively with Government funds in the performance of a contract that does not require the development, manufacture, construction, or production of items, components, or processes;</P>
                                <P>(iv) Form, fit, and function data;</P>
                                <P>(v) Necessary for installation, operation, maintenance, or training purposes (other than detailed manufacturing or process data);</P>
                                <P>(vi) Corrections or changes to technical data furnished to the Contractor by the Government;</P>
                                <P>(vii) Otherwise publicly available or have been released or disclosed by the Contractor or subcontractor without restrictions on further use, release or disclosure, other than a release or disclosure resulting from the sale, transfer, or other assignment of interest in the technical data to another party or the sale or transfer of some or all of a business entity or its assets to another party;</P>
                                <P>(viii) Data in which the Government has obtained unlimited rights under another Government contract or as a result of negotiations; or</P>
                                <P>(ix) Data furnished to the Government, under this or any other Government contract or subcontract thereunder, with—</P>
                                <P>(A) Government purpose license rights or limited rights and the restrictive condition(s) has/have expired; or</P>
                                <P>(B) Government purpose rights and the Contractor's exclusive right to use such data for commercial purposes has expired.</P>
                                <P>
                                    (2) 
                                    <E T="03">Government purpose rights.</E>
                                     (i) The Government shall have government purpose rights for a five-year period, or such other period as may be negotiated, in technical data—
                                </P>
                                <P>(A) That pertain to items, components, or processes developed with mixed funding except when the Government is entitled to unlimited rights in such data as provided in paragraphs (b)(1)(ii) and (b)(1)(iv) through (b)(1)(ix) of this clause; or</P>
                                <P>
                                    (B) Created with mixed funding in the performance of a contract that does not require the development, manufacture, construction, or production of items, components, or processes.
                                    <PRTPAGE P="633"/>
                                </P>
                                <P>(ii) The five-year period, or such other period as may have been negotiated, shall commence upon execution of the contract, subcontract, letter contract (or similar contractual instrument), contract modification, or option exercise that required development of the items, components, or processes or creation of the data described in paragraph (b)(2)(i)(B) of this clause. Upon expiration of the five-year or other negotiated period, the Government shall have unlimited rights in the technical data.</P>
                                <P>(iii) The Government shall not release or disclose technical data in which it has government purpose rights unless—</P>
                                <P>(A) Prior to release or disclosure, the intended recipient is subject to the non-disclosure agreement at 227.7103-7 of the Defense Federal Acquisition Regulation Supplement (DFARS); or</P>
                                <P>(B) The recipient is a Government contractor receiving access to the data for performance of a Government contract that contains the clause at DFARS 252.227-7025, Limitations on the Use or Disclosure of Government-Furnished Information Marked with Restrictive Legends.</P>
                                <P>(iv) The Contractor has the exclusive right, including the right to license others, to use technical data in which the Government has obtained government purpose rights under this contract for any commercial purpose during the time period specified in the government purpose rights legend prescribed in paragraph (f)(2) of this clause.</P>
                                <P>
                                    (3) 
                                    <E T="03">Limited rights.</E>
                                     (i) Except as provided in paragraphs (b)(1)(ii) and (b)(1)(iv) through (b)(1)(ix) of this clause, the Government shall have limited rights in technical data—
                                </P>
                                <P>(A) Pertaining to items, components, or processes developed exclusively at private expense and marked with the limited rights legend prescribed in paragraph (f) of this clause; or</P>
                                <P>(B) Created exclusively at private expense in the performance of a contract that does not require the development, manufacture, construction, or production of items, components, or processes.</P>
                                <P>(ii) The Government shall require a recipient of limited rights data for emergency repair or overhaul to destroy the data and all copies in its possession promptly following completion of the emergency repair/overhaul and to notify the Contractor that the data have been destroyed.</P>
                                <P>(iii) The Contractor, its subcontractors, and suppliers are not required to provide the Government additional rights to use, modify, reproduce, release, perform, display, or disclose technical data furnished to the Government with limited rights. However, if the Government desires to obtain additional rights in technical data in which it has limited rights, the Contractor agrees to promptly enter into negotiations with the Contracting Officer to determine whether there are acceptable terms for transferring such rights. All technical data in which the Contractor has granted the Government additional rights shall be listed or described in a license agreement made part of the contract. The license shall enumerate the additional rights granted the Government in such data.</P>
                                <P>(iv) The Contractor acknowledges that—</P>
                                <P>(A) Limited rights data are authorized to be released or disclosed to covered Government support contractors;</P>
                                <P>(B) The Contractor will be notified of such release or disclosure;</P>
                                <P>(C) The Contractor (or the party asserting restrictions as identified in the limited rights legend) may require each such covered Government support contractor to enter into a non-disclosure agreement directly with the Contractor (or the party asserting restrictions) regarding the covered Government support contractor's use of such data, or alternatively, that the Contractor (or party asserting restrictions) may waive in writing the requirement for a non-disclosure agreement; and</P>
                                <P>(D) Any such non-disclosure agreement shall address the restrictions on the covered Government support contractor's use of the limited rights data as set forth in the clause at 252.227-7025, Limitations on the Use or Disclosure of Government-Furnished Information Marked with Restrictive Legends. The non-disclosure agreement shall not include any additional terms and conditions unless mutually agreed to by the parties to the non-disclosure agreement.</P>
                                <P>
                                    (4) 
                                    <E T="03">Specifically negotiated license rights.</E>
                                     The standard license rights granted to the Government under paragraphs (b)(1) through (b)(3) of this clause, including the period during which the Government shall have government purpose rights in technical data, may be modified by mutual agreement to provide such rights as the parties consider appropriate but shall not provide the Government lesser rights than are enumerated in paragraph (a)(14) of this clause. Any rights so negotiated shall be identified in a license agreement made part of this contract.
                                </P>
                                <P>
                                    (5) 
                                    <E T="03">Prior government rights.</E>
                                     Technical data that will be delivered, furnished, or otherwise provided to the Government under this contract, in which the Government has previously obtained rights shall be delivered, furnished, or provided with the pre-existing rights, unless—
                                </P>
                                <P>(i) The parties have agreed otherwise; or</P>
                                <P>
                                    (ii) Any restrictions on the Government's rights to use, modify, reproduce, release, perform, display, or disclose the data have expired or no longer apply.
                                    <PRTPAGE P="634"/>
                                </P>
                                <P>
                                    (6) 
                                    <E T="03">Release from liability.</E>
                                     The Contractor agrees to release the Government from liability for any release or disclosure of technical data made in accordance with paragraph (a)(14) or (b)(2)(iii) of this clause, in accordance with the terms of a license negotiated under paragraph (b)(4) of this clause, or by others to whom the recipient has released or disclosed the data and to seek relief solely from the party who has improperly used, modified, reproduced, released, performed, displayed, or disclosed Contractor data marked with restrictive legends.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Contractor rights in technical data.</E>
                                     All rights not granted to the Government are retained by the Contractor.
                                </P>
                                <P>
                                    (d) 
                                    <E T="03">Third party copyrighted data.</E>
                                     The Contractor shall not, without the written approval of the Contracting Officer, incorporate any copyrighted data in the technical data to be delivered under this contract unless the Contractor is the copyright owner or has obtained for the Government the license rights necessary to perfect a license or licenses in the deliverable data of the appropriate scope set forth in paragraph (b) of this clause, and has affixed a statement of the license or licenses obtained on behalf of the Government and other persons to the data transmittal document.
                                </P>
                                <P>
                                    (e) 
                                    <E T="03">Identification and delivery of data to be furnished with restrictions on use, release, or disclosure.</E>
                                     (1) This paragraph does not apply to restrictions based solely on copyright.
                                </P>
                                <P>(2) Except as provided in paragraph (e)(3) of this clause, technical data that the Contractor asserts should be furnished to the Government with restrictions on use, release, or disclosure are identified in an attachment to this contract (the Attachment). The Contractor shall not deliver any data with restrictive markings unless the data are listed on the Attachment.</P>
                                <P>(3) In addition to the assertions made in the Attachment, other assertions may be identified after award when based on new information or inadvertent omissions unless the inadvertent omissions would have materially affected the source selection decision. Such identification and assertion shall be submitted to the Contracting Officer as soon as practicable prior to the scheduled date for delivery of the data, in the following format, and signed by an official authorized to contractually obligate the Contractor: Identification and Assertion of Restrictions on the Government's Use, Release, or Disclosure of Technical Data.</P>
                                <P>The Contractor asserts for itself, or the persons identified below, that the Government's rights to use, release, or disclose the following technical data should be restricted—</P>
                                <GPOTABLE COLS="4" OPTS="L2" CDEF="s25,xs36,xs36,xs36">
                                    <BOXHD>
                                        <CHED H="1">
                                            Technical data to be furnished with restrictions 
                                            <SU>1</SU>
                                        </CHED>
                                        <CHED H="1">
                                            Basis for assertion 
                                            <SU>2</SU>
                                        </CHED>
                                        <CHED H="1">
                                            Asserted rights category 
                                            <SU>3</SU>
                                        </CHED>
                                        <CHED H="1">
                                            Name of person asserting restrictions 
                                            <SU>4</SU>
                                        </CHED>
                                    </BOXHD>
                                    <ROW>
                                        <ENT I="01">(LIST)</ENT>
                                        <ENT>(LIST)</ENT>
                                        <ENT>(LIST)</ENT>
                                        <ENT>(LIST)</ENT>
                                    </ROW>
                                    <TNOTE>
                                        <SU>1</SU>
                                         If the assertion is applicable to items, components or processes developed at private expense, identify both the data and each such item, component, or process.
                                    </TNOTE>
                                    <TNOTE>
                                        <SU>2</SU>
                                         Generally, the development of an item, component, or process at private expense, either exclusively or partially, is the only basis for asserting restrictions on the Government's rights to use, release, or disclose technical data pertaining to such items, components, or processes. Indicate whether development was exclusively or partially at private expense. If development was not at private expense, enter the specific reason for asserting that the Government's rights should be restricted.
                                    </TNOTE>
                                    <TNOTE>
                                        <SU>3</SU>
                                         Enter asserted rights category (e.g., government purpose license rights from a prior contract, rights in SBIR data generated under another contract, limited or government purpose rights under this or a prior contract, or specifically negotiated licenses).
                                    </TNOTE>
                                    <TNOTE>
                                        <SU>4</SU>
                                         Corporation, individual, or other person, as appropriate.
                                    </TNOTE>
                                </GPOTABLE>
                                <FP SOURCE="FP-DASH">Date</FP>
                                <FP SOURCE="FP-DASH">Printed Name and Title</FP>
                                <FP SOURCE="FP-DASH"/>
                                <FP SOURCE="FP-DASH">Signature</FP>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of identification and assertion)</HD>
                            <EXTRACT>
                                <P>(4) When requested by the Contracting Officer, the Contractor shall provide sufficient information to enable the Contracting Officer to evaluate the Contractor's assertions. The Contracting Officer reserves the right to add the Contractor's assertions to the Attachment and validate any listed assertion, at a later date, in accordance with the procedures of the Validation of Restrictive Markings on Technical Data clause of this contract.</P>
                                <P>
                                    (f) 
                                    <E T="03">Marking requirements.</E>
                                     The Contractor, and its subcontractors or suppliers, may only assert restrictions on the Government's rights to use, modify, reproduce, release, perform, display, or disclose technical data to be delivered under this contract by marking the deliverable data subject to restriction. Except as provided in paragraph (f)(5) of this clause, only the following legends are authorized under this contract: the government purpose rights legend at paragraph (f)(2) of this clause; the limited rights legend at paragraph (f)(3) of this clause; or the special license rights legend at paragraph (f)(4) of this clause; and/or a notice of copyright as prescribed under 17 U.S.C. 401 or 402.
                                </P>
                                <P>
                                    (1) 
                                    <E T="03">General marking instructions.</E>
                                     The Contractor, or its subcontractors or suppliers, shall conspicuously and legibly mark the appropriate legend on all technical data that qualify for such markings. The authorized legends shall be placed on the transmittal document or storage container and, for printed material, each page of the printed material containing technical data for which restrictions are asserted. When only portions of a page of printed material are subject to the asserted restrictions, such portions shall 
                                    <PRTPAGE P="635"/>
                                    be identified by circling, underscoring, with a note, or other appropriate identifier. Technical data transmitted directly from one computer or computer terminal to another shall contain a notice of asserted restrictions. Reproductions of technical data or any portions thereof subject to asserted restrictions shall also reproduce the asserted restrictions.
                                </P>
                                <P>
                                    (2) 
                                    <E T="03">Government purpose rights markings.</E>
                                     Data delivered or otherwise furnished to the Government with government purpose rights  shall be marked as follows:
                                </P>
                                <HD SOURCE="HD3">Government Purpose Rights</HD>
                                <FP SOURCE="FP-DASH">Contract No.</FP>
                                <FP SOURCE="FP-DASH">Contractor Name</FP>
                                <FP SOURCE="FP-DASH">Contractor Address</FP>
                                <FP SOURCE="FP-DASH"/>
                                <FP SOURCE="FP-DASH">Expiration Date</FP>
                                <P>The Government's rights to use, modify, reproduce, release, perform, display, or disclose these technical data are restricted by paragraph (b)(2) of the Rights in Technical Data—Other Than Commercial Products or Commercial Services clause contained in the above identified contract. No restrictions apply after the expiration date shown above. Any reproduction of technical data or portions thereof marked with this legend must also reproduce the markings.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of legend)</HD>
                            <EXTRACT>
                                <P>
                                    (3) 
                                    <E T="03">Limited rights markings.</E>
                                     Data delivered or otherwise furnished to the Government with limited rights shall be marked with the following legend:
                                </P>
                                <HD SOURCE="HD3">Limited Rights</HD>
                                <FP SOURCE="FP-DASH">Contract No.</FP>
                                <FP SOURCE="FP-DASH">Contractor Name</FP>
                                <FP SOURCE="FP-DASH">Contractor Address</FP>
                                <FP SOURCE="FP-DASH"/>
                                <P>The Government's rights to use, modify, reproduce, release, perform, display, or disclose these technical data are restricted by paragraph (b)(3) of the Rights in Technical Data—Other Than Commercial Products or Commercial Services clause contained in the above identified contract. Any reproduction of technical data or portions thereof marked with this legend must also reproduce the markings. Any person, other than the Government, who has been provided access to such data must promptly notify the above named Contractor.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of legend)</HD>
                            <EXTRACT>
                                <P>
                                    (4) 
                                    <E T="03">Special license rights markings.</E>
                                     (i) Data in which the Government's rights stem from a specifically negotiated license shall be marked with the following legend:
                                </P>
                                <HD SOURCE="HD3">Special License Rights</HD>
                                <P>The Government's rights to use, modify, reproduce, release, perform, display, or disclose these data are restricted by Contract No. ________________ (Insert contract number) ________________, License No. ________________ (Insert license identifier) ________________. Any reproduction of technical data or portions thereof marked with this legend must also reproduce the markings.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of legend)</HD>
                            <EXTRACT>
                                <P>(ii) For purposes of this clause, special licenses do not include government purpose license rights acquired under a prior contract (see paragraph (b)(5) of this clause).</P>
                                <P>
                                    (5) 
                                    <E T="03">Pre-existing data markings.</E>
                                     If the terms of a prior contract or license permitted the Contractor to restrict the Government's rights to use, modify, reproduce, release, perform, display, or disclose technical data deliverable under this contract, and those restrictions are still applicable, the Contractor may mark such data with the appropriate restrictive legend for which the data qualified under the prior contract or license. The marking procedures in paragraph (f)(1) of this clause shall be followed.
                                </P>
                                <P>
                                    (g) 
                                    <E T="03">Contractor procedures and records.</E>
                                     Throughout performance of this contract, the Contractor and its subcontractors or suppliers that will deliver technical data with other than unlimited rights, shall—
                                </P>
                                <P>(1) Have, maintain, and follow written procedures sufficient to assure that restrictive markings are used only when authorized by the terms of this clause; and</P>
                                <P>(2) Maintain records sufficient to justify the validity of any restrictive markings on technical data delivered under this contract.</P>
                                <P>
                                    (h) 
                                    <E T="03">Removal of unjustified and nonconforming markings</E>
                                    —(1) 
                                    <E T="03">Unjustified technical data markings.</E>
                                     The rights and obligations of the parties regarding the validation of restrictive markings on technical data furnished or to be furnished under this contract are contained in the Validation of Restrictive Markings on Technical Data clause of this contract. Notwithstanding any provision of this contract concerning inspection and acceptance, the Government may ignore or, at the Contractor's expense, correct or strike a marking if, in accordance with the procedures in the Validation of Restrictive Markings on Technical Data clause of this contract, a restrictive marking is determined to be unjustified.
                                </P>
                                <P>
                                    (2) 
                                    <E T="03">Nonconforming technical data markings.</E>
                                     A nonconforming marking is a marking placed on technical data delivered or otherwise furnished to the Government under this contract that is not in the format authorized by this contract. Correction of nonconforming markings is not subject to the Validation of Restrictive Markings on Technical Data clause of this contract. If the Contracting 
                                    <PRTPAGE P="636"/>
                                    Officer notifies the Contractor of a nonconforming marking and the Contractor fails to remove or correct such marking within sixty (60) days, the Government may ignore or, at the Contractor's expense, remove or correct any nonconforming marking.
                                </P>
                                <P>
                                    (i) 
                                    <E T="03">Relation to patents.</E>
                                     Nothing contained in this clause shall imply a license to the Government under any patent or be construed as affecting the scope of any license or other right otherwise granted to the Government under any patent.
                                </P>
                                <P>
                                    (j) 
                                    <E T="03">Limitation on charges for rights in technical data.</E>
                                     (1) The Contractor shall not charge to this contract any cost, including, but not limited to, license fees, royalties, or similar charges, for rights in technical data to be delivered under this contract when—
                                </P>
                                <P>(i) The Government has acquired, by any means, the same or greater rights in the data; or</P>
                                <P>(ii) The data are available to the public without restrictions.</P>
                                <P>(2) The limitation in paragraph (j)(1) of this clause—</P>
                                <P>(i) Includes costs charged by a subcontractor or supplier, at any tier, or costs incurred by the Contractor to acquire rights in subcontractor or supplier technical data, if the subcontractor or supplier has been paid for such rights under any other Government contract or under a license conveying the rights to the Government; and</P>
                                <P>(ii) Does not include the reasonable costs of reproducing, handling, or mailing the documents or other media in which the technical data will be delivered.</P>
                                <P>
                                    (k) 
                                    <E T="03">Applicability to subcontractors or suppliers.</E>
                                     (1) The Contractor shall ensure that the rights afforded its subcontractors and suppliers under 10 U.S.C. 3771-3775, 10 U.S.C. 3781-3786, and the identification, assertion, and delivery processes of paragraph (e) of this clause are recognized and protected.
                                </P>
                                <P>(2) Whenever any technical data for other than commercial products or commercial services, or for commercial products or commercial services developed in any part at Government expense, is to be obtained from a subcontractor or supplier for delivery to the Government under this contract, the Contractor shall use this same clause in the subcontract or other contractual instrument, including subcontracts or other contractual instruments for commercial products or commercial services, and require its subcontractors or suppliers to do so, without alteration, except to identify the parties. This clause will govern the technical data pertaining to noncommercial items or to any portion of a commercial product or commercial service  that was developed in any part at Government expense, and the clause at 252.227-7015 will govern the technical data pertaining to any portion of a commercial item that was developed exclusively at private expense. No other clause shall be used to enlarge or diminish the Government's, the Contractor's, or a higher-tier subcontractor's or supplier's rights in a subcontractor's or supplier's technical data.</P>
                                <P>(3) Technical data required to be delivered by a subcontractor or supplier shall normally be delivered to the next higher-tier contractor, subcontractor, or supplier. However, when there is a requirement in the prime contract for data which may be submitted with other than unlimited rights by a subcontractor or supplier, then said subcontractor or supplier may fulfill its requirement by submitting such data directly to the Government, rather than through a higher-tier contractor, subcontractor, or supplier.</P>
                                <P>(4) The Contractor and higher-tier subcontractors or suppliers shall not use their power to award contracts as economic leverage to obtain rights in technical data from their subcontractors or suppliers.</P>
                                <P>(5) In no event shall the Contractor use its obligation to recognize and protect subcontractor or supplier rights in technical data as an excuse for failing to satisfy its contractual obligations to the Government.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate I</E>
                                 (JUN 1995). As prescribed in 227.7103-6(b)(1)), add the following paragraph (l) to the basic clause:
                            </P>
                            <EXTRACT>
                                <P>
                                    (l) 
                                    <E T="03">Publication for sale.</E>
                                     (1) This paragraph only applies to technical data in which the Government has obtained unlimited rights or a license to make an unrestricted release of technical data.
                                </P>
                                <P>(2) The Government shall not publish a deliverable technical data item or items identified in this contract as being subject to paragraph (l) of this clause or authorize others to publish such data on its behalf if, prior to publication for sale by the Government and within twenty-four (24) months following the date specified in this contract for delivery of such data or the removal of any national security or export control restrictions, whichever is later, the Contractor publishes that item or items for sale and promptly notifies the Contracting Officer of such publication(s). Any such publication shall include a notice identifying the number of this contract and the Government's rights in the published data.</P>
                                <P>(3) This limitation on the Government's right to publish for sale shall continue as long as the data are reasonably available to the public for purchase.</P>
                            </EXTRACT>
                            <P>
                                <E T="03">Alternate II</E>
                                 (MAR 2022)
                            </P>
                            <P>As prescribed in 227.7103-6(b)(2), add the following paragraphs (a)(17) and (b)(7) to the basic clause:</P>
                            <EXTRACT>
                                <P>
                                    (a)(17) “Vessel design” means the design of a vessel, boat, or craft, and its components, 
                                    <PRTPAGE P="637"/>
                                    including the hull, decks, superstructure, and the exterior surface shape of all external shipboard equipment and systems. The term includes designs covered by 10 U.S.C. 8687, and designs protectable under 17 U.S.C. 1301, 
                                    <E T="03">et seq.</E>
                                </P>
                                <P>
                                    (b)(7) 
                                    <E T="03">Vessel designs.</E>
                                     For a vessel design (including a vessel design embodied in a useful article) that is developed or delivered under this contract, the Government shall have the right to make and have made any useful article that embodies the vessel design, to import the article, to sell the article, and to distribute the article for sale or to use the article in trade, to the same extent that the Government is granted rights in the technical data pertaining to the vessel design.
                                </P>
                            </EXTRACT>
                            <CITA>[60 FR 33490, June 28, 1995, as amended at 60 FR 61602, Nov. 30, 1995; 74 FR 61044, Nov. 23, 2009; 76 FR 11367, Mar. 2, 2011; 76 FR 58148, Sept. 20, 2011; 77 FR 10976, Feb. 24, 2012; 78 FR 30238, May 22, 2013; 78 FR 37990, June 25, 2013; 79 FR 11341, Feb. 28, 2014; 87 FR 15819, Mar. 18, 2022; 87 FR 76997, Dec. 16, 2022; 88 FR 6593, Jan. 31, 2023; 88 FR 17345, Mar. 22, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7014</SECTNO>
                            <SUBJECT>Rights in Other Than Commercial Computer Software and Other Than Commercial Computer Software Documentation.</SUBJECT>
                            <P>As prescribed in 227.7203-6(a)(1), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Rights in Other Than Commercial Computer Software and Other Than Commercial Computer Software Documentation (MAR 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    (1) 
                                    <E T="03">Commercial computer software</E>
                                     means software developed or regularly used for nongovernmental purposes which—
                                </P>
                                <P>(i) Has been sold, leased, or licensed to the public;</P>
                                <P>(ii) Has been offered for sale, lease, or license to the public;</P>
                                <P>(iii) Has not been offered, sold, leased, or licensed to the public but will be available for commercial sale, lease, or license in time to satisfy the delivery requirements of this contract; or</P>
                                <P>(iv) Satisfies a criterion expressed in paragraph (a)(1) (i), (ii), or (iii) of this clause and would require only minor modification to meet the requirements of this contract.</P>
                                <P>
                                    (2) 
                                    <E T="03">Computer database</E>
                                     means a collection of recorded data in a form capable of being processed by a computer. The term does not include computer software.
                                </P>
                                <P>
                                    (3) 
                                    <E T="03">Computer program</E>
                                     means a set of instructions, rules, or routines, recorded in a form that is capable of causing a computer to perform a specific operation or series of operations.
                                </P>
                                <P>
                                    (4) 
                                    <E T="03">Computer software</E>
                                     means computer programs, source code, source code listings, object code listings, design details, algorithms, processes, flow charts, formulae, and related material that would enable the software to be reproduced, recreated, or recompiled. Computer software does not include computer databases or computer software documentation.
                                </P>
                                <P>
                                    (5) 
                                    <E T="03">Computer software documentation</E>
                                     means owner's manuals, user's manuals, installation instructions, operating instructions, and other similar items, regardless of storage medium, that explain the capabilities of the computer software or provide instructions for using the software.
                                </P>
                                <P>
                                    (6) 
                                    <E T="03">Covered Government support contractor</E>
                                     means a contractor (other than a litigation support contractor covered by 252.204-7014) under a contract, the primary purpose of which is to furnish independent and impartial advice or technical assistance directly to the Government in support of the Government's management and oversight of a program or effort (rather than to directly furnish an end item or service to accomplish a program or effort), provided that the contractor—
                                </P>
                                <P>(i) Is not affiliated with the prime contractor or a first-tier subcontractor on the program or effort, or with any direct competitor of such prime contractor or any such first-tier subcontractor in furnishing end items or services of the type developed or produced on the program or effort; and</P>
                                <P>(ii) Receives access to technical data or computer software for performance of a Government contract that contains the clause at 252.227-7025, Limitations on the Use or Disclosure of Government-Furnished Information Marked with Restrictive Legends.</P>
                                <P>
                                    (7) 
                                    <E T="03">Developed</E>
                                     means that—
                                </P>
                                <P>(i) A computer program has been successfully operated in a computer and tested to the extent sufficient to demonstrate to reasonable persons skilled in the art that the program can reasonably be expected to perform its intended purpose;</P>
                                <P>(ii) Computer software, other than computer programs, has been tested or analyzed to the extent sufficient to demonstrate to reasonable persons skilled in the art that the software can reasonably be expected to perform its intended purpose; or</P>
                                <P>(iii) Computer software documentation required to be delivered under a contract has been written, in any medium, in sufficient detail to comply with requirements under that contract.</P>
                                <P>
                                    (8) 
                                    <E T="03">Developed exclusively at private expense</E>
                                     means development was accomplished entirely with costs charged to indirect cost pools, costs not allocated to a government contract, or any combination thereof.
                                </P>
                                <P>(i) Private expense determinations should be made at the lowest practicable level.</P>
                                <P>
                                    (ii) Under fixed-price contracts, when total costs are greater than the firm-fixed-price or ceiling price of the contract, the additional 
                                    <PRTPAGE P="638"/>
                                    development costs necessary to complete development shall not be considered when determining whether development was at government, private, or mixed expense.
                                </P>
                                <P>
                                    (9) 
                                    <E T="03">Developed exclusively with government funds</E>
                                     means development was not accomplished exclusively or partially at private expense.
                                </P>
                                <P>
                                    (10) 
                                    <E T="03">Developed with mixed funding</E>
                                     means development was accomplished partially with costs charged to indirect cost pools and/or costs not allocated to a government contract, and partially with costs charged directly to a government contract.
                                </P>
                                <P>
                                    (11) 
                                    <E T="03">Government purpose</E>
                                     means any activity in which the United States Government is a party, including cooperative agreements with international or multi-national defense organizations or sales or transfers by the United States Government to foreign governments or international organizations. Government purposes include competitive procurement, but do not include the rights to use, modify, reproduce, release, perform, display, or disclose computer software or computer software documentation for commercial purposes or authorize others to do so.
                                </P>
                                <P>
                                    (12) 
                                    <E T="03">Government purpose rights</E>
                                     means the rights to—
                                </P>
                                <P>(i) Use, modify, reproduce, release, perform, display, or disclose computer software or computer software documentation within the Government without restriction; and</P>
                                <P>(ii) Release or disclose computer software or computer software documentation outside the Government and authorize persons to whom release or disclosure has been made to use, modify, reproduce, release, perform, display, or disclose the software or documentation for United States government purposes.</P>
                                <P>
                                    (13) 
                                    <E T="03">Minor modification</E>
                                     means a modification that does not significantly alter the nongovernmental function or purpose of the software or is of the type customarily provided in the commercial marketplace.
                                </P>
                                <P>
                                    (14) 
                                    <E T="03">Other than commercial computer software</E>
                                     means software that does not qualify as commercial computer software under the definition of “commercial computer software” of this clause.
                                </P>
                                <P>
                                    (15) 
                                    <E T="03">Restricted rights</E>
                                     apply only to other than commercial computer software and mean the Government's rights to—
                                </P>
                                <P>(i) Use a computer program with one computer at one time. The program may not be accessed by more than one terminal or central processing unit or time shared unless otherwise permitted by this contract;</P>
                                <P>(ii) Transfer a computer program to another Government agency without the further permission of the Contractor if the transferor destroys all copies of the program and related computer software documentation in its possession and notifies the licensor of the transfer. Transferred programs remain subject to the provisions of this clause;</P>
                                <P>(iii) Make a reasonable number of copies of the computer software required for the purposes of safekeeping (archive), backup, modification, or other activities authorized in paragraphs (a)(15)(i), (ii), and (iv) through (vii) of this clause;</P>
                                <P>(iv) Modify computer software provided that the Government may—</P>
                                <P>(A) Use the modified software only as provided in paragraphs (a)(15)(i) and (iii) of this clause; and</P>
                                <P>(B) Not release or disclose the modified software except as provided in paragraphs (a)(15)(ii), (v), (vi) and (vii) of this clause;</P>
                                <P>(v) Use, and permit contractors or subcontractors performing service contracts (see 37.101 of the Federal Acquisition Regulation) in support of this or a related contract to use, computer software to diagnose and correct deficiencies in a computer program, to modify computer software to enable a computer program to be combined with, adapted to, or merged with other computer programs or when necessary to respond to urgent tactical situations, provided that—</P>
                                <P>(A) The Government notifies the party which has granted restricted rights that any such release or disclosure to particular contractors or subcontractors was made;</P>
                                <P>(B) Such contractors or subcontractors are subject to the use and nondisclosure agreement at 227.7103-7 of the Defense Federal Acquisition Regulation Supplement (DFARS) or are Government contractors receiving access to the software for performance of a Government contract that contains the clause at DFARS 252.227-7025, Limitations on the Use or Disclosure of Government-Furnished Information Marked with Restrictive Legends;</P>
                                <P>(C) The Government shall not permit the recipient to decompile, disassemble, or reverse engineer the software, or use software decompiled, disassembled, or reverse engineered by the Government pursuant to paragraph (a)(15)(iv) of this clause, for any other purpose; and</P>
                                <P>(D) Such use is subject to the limitations in paragraphs (a)(15)(i) through (iii) of this clause;</P>
                                <P>(vi) Use, and permit contractors or subcontractors performing emergency repairs or overhaul of items or components of items procured under this or a related contract to use, the computer software when necessary to perform  or overhaul, or to modify the computer software to reflect the emergency repairs or overhaul made, provided that—</P>
                                <P>
                                    (A) The intended recipient is subject to the use and non-disclosure agreement at DFARS 227.7103-7 or is a Government contractor receiving access to the software for performance of a Government contract that contains the clause at DFARS 252.227-7025, Limitations on the Use or Disclosure of Government-Furnished Information Marked with Restrictive Legends;
                                    <PRTPAGE P="639"/>
                                </P>
                                <P>(B) The Government shall not permit the recipient to decompile, disassemble, or reverse engineer the software, or use software decompiled, disassembled, or reverse engineered by the Government pursuant to paragraph (a)(15)(iv) of this clause, for any other purpose; and</P>
                                <P>(C) Such use is subject to the limitations in paragraphs (a)(15)(i) through (iii) of this clause; and</P>
                                <P>(vii) Use, modify, reproduce, perform, display, or release or disclose computer software to a person authorized to receive restricted rights computer software for management and oversight of a program or effort, and permit covered Government support contractors in the performance of covered Government support contracts that contain the clause at 252.227-7025, Limitations on the Use or Disclosure of Government-Furnished Information Marked with Restrictive Legends, to use, modify, reproduce, perform, display, or release or disclose the computer software to a person authorized to receive restricted rights computer software, provided that—</P>
                                <P>(A) The Government shall not permit the covered Government support contractor to decompile, disassemble, or reverse engineer the software, or use software decompiled, disassembled, or reverse engineered by the Government pursuant to paragraph (a)(15)(iv) of this clause, for any other purpose; and</P>
                                <P>(B) Such use is subject to the limitations in paragraphs (a)(15)(i) through (iv) of this clause.</P>
                                <P>
                                    (16) 
                                    <E T="03">Unlimited rights</E>
                                     means rights to use, modify, reproduce, release, perform, display, or disclose computer software or computer software documentation in whole or in part, in any manner and for any purpose whatsoever, and to have or authorize others to do so.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Rights in computer software or computer software documentation.</E>
                                     The Contractor grants or shall obtain for the Government the following royalty free, worldwide , nonexclusive, irrevocable license rights in other than commercial computer software or computer software documentation. All rights not granted to the Government are retained by the Contractor.
                                </P>
                                <P>
                                    (1) 
                                    <E T="03">Unlimited rights.</E>
                                     The Government shall have unlimited rights in—
                                </P>
                                <P>(i) Computer software developed exclusively with Government funds;</P>
                                <P>(ii) Computer software documentation required to be delivered under this contract;</P>
                                <P>(iii) Corrections or changes to computer software or computer software documentation furnished to the Contractor by the Government;</P>
                                <P>(iv) Computer software or computer software documentation that is otherwise publicly available or has been released or disclosed by the Contractor or subcontractor without restriction on further use, release or disclosure, other than a release or disclosure resulting from the sale, transfer, or other assignment of interest in the software to another party or the sale or transfer of some or all of a business entity or its assets to another party;</P>
                                <P>(v) Computer software or computer software documentation obtained with unlimited rights under another Government contract or as a result of negotiations; or</P>
                                <P>(vi) Computer software or computer software documentation furnished to the Government, under this or any other Government contract or subcontract thereunder with—</P>
                                <P>(A) Restricted rights in computer software, limited rights in technical data, or government purpose license rights and the restrictive conditions have expired; or</P>
                                <P>(B) Government purpose rights and the Contractor's exclusive right to use such software or documentation for commercial purposes has expired.</P>
                                <P>
                                    (2) 
                                    <E T="03">Government purpose rights.</E>
                                     (i) Except as provided in paragraph (b)(1) of this clause, the Government shall have government purpose rights in computer software development with mixed funding.
                                </P>
                                <P>(ii) Government purpose rights shall remain in effect for a period of five years unless a different period has been negotiated. Upon expiration of the five-year or other negotiated period, the Government shall have unlimited rights in the computer software or computer software documentation. The government purpose rights period shall commence upon execution of the contract, subcontract, letter contract (or similar contractual instrument), contract modification, or option exercise that required development of the computer software.</P>
                                <P>(iii) The Government shall not release or disclose computer software in which it has government purpose rights to any other person unless—</P>
                                <P>(A) Prior to release or disclosure, the intended recipient is subject to the use and non-disclosure agreement at DFARS 227.7103-7; or</P>
                                <P>(B) The recipient is a Government contractor receiving access to the software or documentation for performance of a Government contract that contains the clause at DFARS 252.227-7025, Limitations on the Use or Disclosure of Government Furnished Information Marked with Restrictive Legends.</P>
                                <P>
                                    (3) 
                                    <E T="03">Restricted rights.</E>
                                     (i) The Government shall have restricted rights in other than commercial computer software  required to be delivered or otherwise provided to the Government under this contract that were developed exclusively at private expense.
                                </P>
                                <P>
                                    (ii) The Contractor, its subcontractors, or suppliers are not required to provide the Government additional rights in other than commercial computer software delivered or 
                                    <PRTPAGE P="640"/>
                                    otherwise provided to the Government with restricted rights. However, if the Government desires to obtain additional rights in such software, the Contractor agrees to promptly enter into negotiations with the Contracting Officer to determine whether there are acceptable terms for transferring such rights. All noncommercial computer software in which the Contractor has granted the Government additional rights shall be listed or described in a license agreement made part of the contract (see paragraph (b)(4) of this clause). The license shall enumerate the additional rights granted the Government.
                                </P>
                                <P>(iii) The Contractor acknowledges that—</P>
                                <P>(A) Restricted rights computer software is authorized to be released or disclosed to covered Government support contractors;</P>
                                <P>(B) The Contractor will be notified of such release or disclosure;</P>
                                <P>(C) The Contractor (or the party asserting restrictions, as identified in the restricted rights legend) may require each such covered Government support contractor to enter into a non-disclosure agreement directly with the Contractor (or the party asserting restrictions) regarding the covered Government support contractor's use of such software, or alternatively, that the Contractor (or party asserting restrictions) may waive in writing the requirement for a non-disclosure agreement; and</P>
                                <P>(D) Any such non-disclosure agreement shall address the restrictions on the covered Government support contractor's use of the restricted rights software as set forth in the clause at 252.227-7025, Limitations on the Use or Disclosure of Government-Furnished Information Marked with Restrictive Legends. The non-disclosure agreement shall not include any additional terms and conditions unless mutually agreed to by the parties to the non-disclosure agreement.</P>
                                <P>
                                    (4) 
                                    <E T="03">Specifically negotiated license rights.</E>
                                    (i) The standard license rights granted to the Government under paragraphs (b)(1) through (3) of this clause, including the period during which the Government shall have government purpose rights in computer software, may be modified by mutual agreement to provide such rights as the parties consider appropriate but shall not provide the Government lesser rights in computer software than are enumerated in the definition of “restricted rights” of this clause or lesser rights in computer software documentation than are enumerated in the definition of “limited rights” of the Rights in Technical Data—Other Than Commercial Products and Commercial Services clause of this contract.
                                </P>
                                <P>(ii) Any rights so negotiated shall be identified in a license agreement made part of this contract.</P>
                                <P>
                                    (5) 
                                    <E T="03">Prior government rights.</E>
                                     Computer software or computer software documentation that will be delivered, furnished, or otherwise provided to the Government under this contract, in which the Government has previously obtained rights shall be delivered, furnished, or provided with the pre-existing rights, unless—
                                </P>
                                <P>(i) The parties have agreed otherwise; or</P>
                                <P>(ii) Any restrictions on the Government's rights to use, modify, reproduce, release, perform, display, or disclose the data have expired or no longer apply.</P>
                                <P>
                                    (6) 
                                    <E T="03">Release from liability.</E>
                                     The Contractor agrees to release the Government from liability for any release or disclosure of computer software made in accordance with paragraph (a)(15) or (b)(2)(iii) of this clause, in accordance with the terms of a license negotiated under paragraph (b)(4) of this clause, or by others to whom the recipient has released or disclosed the software, and to seek relief solely from the party who has improperly used, modified, reproduced, released, performed, displayed, or disclosed Contractor software marked with restrictive legends.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Rights in derivative computer software or computer software documentation.</E>
                                     The Government shall retain its rights in the unchanged portions of any computer software or computer software documentation delivered under this contract that the Contractor uses to prepare, or includes in, derivative computer software or computer software documentation.
                                </P>
                                <P>
                                    (d) 
                                    <E T="03">Third party copyrighted computer software or computer software documentation.</E>
                                     The Contractor shall not, without the written approval of the Contracting Officer, incorporate any copyrighted computer software or computer software documentation in the software or documentation to be delivered under this contract unless the Contractor is the copyright owner or has obtained for the Government the license rights necessary to perfect a license or licenses in the deliverable software or documentation of the appropriate scope set forth in paragraph (b) of this clause, and prior to delivery of such—
                                </P>
                                <P>(1) Computer software, has provided a statement of the license rights obtained in a form acceptable to the Contracting Officer; or</P>
                                <P>(2) Computer software documentation, has affixed to the transmittal document a statement of the license rights obtained.</P>
                                <P>
                                    (e) 
                                    <E T="03">Identification and delivery of computer software and computer software documentation to be furnished with restrictions on use, release, or disclosure.</E>
                                     (1) This paragraph does not apply to restrictions based solely on copyright.
                                </P>
                                <P>
                                    (2) Except as provided in paragraph (e)(3) of this clause, computer software that the Contractor asserts should be furnished to the Government with restrictions on use, release, or disclosure is identified in an attachment to this contract (the Attachment). The Contractor shall not deliver any software 
                                    <PRTPAGE P="641"/>
                                    with restrictive markings unless the software is listed on the Attachment.
                                </P>
                                <P>(3) In addition to the assertions made in the Attachment, other assertions may be identified after award when based on new information or inadvertent omissions unless the inadvertent omissions would have materially affected the source selection decision. Such identification and assertion shall be submitted to the Contracting Officer as soon as practicable prior to the scheduled data for delivery of the software, in the following format, and signed by an official authorized to contractually obligate the Contractor: Identification and Assertion of Restrictions on the Government's Use, Release, or Disclosure of Computer Software.</P>
                                <P>The Contractor asserts for itself, or the persons identified below, that the Government's rights to use, release, or disclose the following computer software should be restricted:</P>
                                <GPOTABLE COLS="4" OPTS="L2" CDEF="s25,r25,r25,r25">
                                    <BOXHD>
                                        <CHED H="1">Computer Software to be Furnished With Restrictions*</CHED>
                                        <CHED H="1">Basis for Assertion**</CHED>
                                        <CHED H="1">Asserted Rights Category***</CHED>
                                        <CHED H="1">Name of Person Asserting Restrictions****</CHED>
                                    </BOXHD>
                                    <ROW>
                                        <ENT I="01" O="xl">(LIST)</ENT>
                                        <ENT O="xl">(LIST)</ENT>
                                        <ENT O="xl">(LIST)</ENT>
                                        <ENT O="xl">(LIST)</ENT>
                                    </ROW>
                                    <TNOTE>*Generally, development at private expense, either exclusively or partially, is the only basis for asserting restrictions on the Government's rights to use, release, or disclose computer software.</TNOTE>
                                    <TNOTE>**Indicate whether development was exclusively or partially at private expense. If development was not at private expense, enter the specific reason for asserting that the Government's rights should be restricted.</TNOTE>
                                    <TNOTE>***Enter asserted rights category (e.g., restricted or government purpose rights in computer software, government purpose license rights from a prior contract, rights in SBIR software generated under another contract, or specifically negotiated licenses).</TNOTE>
                                    <TNOTE>****Corporation, individual, or other person, as appropriate.</TNOTE>
                                </GPOTABLE>
                                <FP SOURCE="FP-DASH">Date</FP>
                                <FP SOURCE="FP-DASH">Printed Name and Title</FP>
                                <FP SOURCE="FP-DASH"/>
                                <FP SOURCE="FP-DASH">Signature</FP>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of identification and assertion)</HD>
                            <EXTRACT>
                                <P>(4) When requested by the Contracting Officer, the Contractor shall provide sufficient information to enable the Contracting Officer to evaluate the Contractor's assertions. The Contracting Officer reserves the right to add the Contractor's assertions to the Attachment and validate any listed assertion, at a later date, in accordance with the procedures of the Validation of Asserted Restrictions—Computer Software clause of this contract.</P>
                                <P>
                                    (f) 
                                    <E T="03">Marking requirements.</E>
                                     The Contractor, and its subcontractors or suppliers, may only assert restrictions on the Government's rights to use, modify, reproduce, release, perform, display, or disclose computer software by marking the deliverable software or documentation subject to restriction. Except as provided in paragraph (f)(5) of this clause, only the following legends are authorized under this contract; the government purpose rights legend at paragraph (f)(2) of this clause; the restricted rights legend at paragraph (f)(3) of this clause; or the special license rights legend at paragraph (f)(4) of this clause; and/or a notice of copyright as prescribed under 17 U.S.C. 401 or 402.
                                </P>
                                <P>
                                    (1) 
                                    <E T="03">General marking instructions.</E>
                                     The Contractor, or its subcontractors or suppliers, shall conspicuously and legibly mark the appropriate legend on all computer software that qualify for such markings. The authorized legends shall be placed on the transmitted document or software storage container and each page, or portions thereof, of printed material containing computer software for which restrictions are asserted. Computer software transmitted directly from one computer or computer terminal to another shall contain a notice of asserted restrictions. However, instructions that interfere with or delay the operation of computer software in order to display a restrictive rights legend or other license statement at any time prior to or during use of the computer software, or otherwise cause such interference or delay, shall not be inserted in software that will or might be used in combat or situations that simulate combat conditions, unless the Contracting Officer's written permission to deliver such software has been obtained prior to delivery. Reproductions of computer software or any portions thereof subject to asserted restrictions, shall also reproduce the asserted restrictions.
                                </P>
                                <P>
                                    (2) 
                                    <E T="03">Government purpose rights markings.</E>
                                     Computer software delivered or otherwise furnished to the Government with government purpose rights shall be marked as follows:
                                </P>
                                <HD SOURCE="HD1">Government Purpose Rights</HD>
                                <FP SOURCE="FP-DASH">Contract No.</FP>
                                <FP SOURCE="FP-DASH">Contractor Name</FP>
                                <FP SOURCE="FP-DASH">Contractor Address</FP>
                                <FP SOURCE="FP-DASH"/>
                                <FP SOURCE="FP-DASH">Expiration Date</FP>
                                <P>The Government's rights to use, modify, reproduce, release, perform, display, or disclose this software are restricted by paragraph (b)(2) of the Rights in Other Than Commercial Computer Software and Other Than Commercial Computer Software Documentation clause contained in the above identified contract. No restrictions apply after the expiration date shown above. Any reproduction of the software or portions thereof marked with this legend must also reproduce the markings.</P>
                            </EXTRACT>
                            <PRTPAGE P="642"/>
                            <HD SOURCE="HD3">(End of legend)</HD>
                            <EXTRACT>
                                <P>
                                    (3) 
                                    <E T="03">Restricted rights markings.</E>
                                     Software delivered or otherwise furnished to the Government with restricted rights shall be marked with the following legend:
                                </P>
                                <HD SOURCE="HD1">Restricted Rights</HD>
                                <FP SOURCE="FP-DASH">Contract No.</FP>
                                <FP SOURCE="FP-DASH">Contractor Name</FP>
                                <FP SOURCE="FP-DASH">Contractor Address</FP>
                                <FP SOURCE="FP-DASH"/>
                                <P>The Government's rights to use, modify, reproduce, release, perform, display, or disclose this software are restricted by paragraph (b)(3) of the Rights in Other Than Commercial Computer Software and Other Than Commercial Computer Software Documentation clause contained in the above identified contract. Any reproduction of computer software or portions thereof marked with this legend must also reproduce the markings. Any person, other than the Government, who has been provided access to such software must promptly notify the above named Contractor.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of legend)</HD>
                            <EXTRACT>
                                <P>
                                    (4) 
                                    <E T="03">Special license rights markings.</E>
                                     (i) Computer software or computer documentation in which the Government's rights stem from a specifically negotiated license shall be marked with the following legend:
                                </P>
                                <HD SOURCE="HD1">Special License Rights</HD>
                                <P>The Government's rights to use, modify, reproduce, release, perform, display, or disclose this software are restricted by Contract No. ________(Insert contract number)________, License No.________(Insert license identifier)________. Any reproduction of computer software, computer software documentation, or portions thereof marked with this legend must also reproduce the markings.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of legend)</HD>
                            <EXTRACT>
                                <P>(ii) For purposes of this clause, special licenses do not include government purpose license rights acquired under a prior contract (see paragraph (b)(5) of this clause).</P>
                                <P>
                                    (5) 
                                    <E T="03">Pre-existing markings.</E>
                                     If the terms of a prior contract or license permitted the Contractor to restrict the Government's rights to use, modify, release, perform, display, or disclose computer software or computer software documentation and those restrictions are still applicable, the Contractor may mark such software or documentation with the appropriate restrictive legend for which the software qualified under the prior contract or license. The marking procedures in paragraph (f)(1) of this clause shall be followed.
                                </P>
                                <P>
                                    (g) 
                                    <E T="03">Contractor procedures and records.</E>
                                     Throughout performance of this contract, the Contractor and its subcontractors or suppliers that will deliver computer software or computer software documentation with other than unlimited rights, shall—
                                </P>
                                <P>(1) Have, maintain, and follow written procedures sufficient to assure that restrictive markings are used only when authorized by the terms of this clause; and</P>
                                <P>(2) Maintain records sufficient to justify the validity of any restrictive markings on computer software or computer software documentation delivered under this contract.</P>
                                <P>
                                    (h) 
                                    <E T="03">Removal of unjustified and nonconforming markings</E>
                                    —(1) 
                                    <E T="03">Unjustified computer software or computer software documentation markings.</E>
                                     The rights and obligations of the parties regarding the validation of restrictive markings on computer software or computer software documentation furnished or to be furnished under this contract are contained in the Validation of Asserted Restrictions—Computer Software and the Validation of Restrictive Markings on Technical Data clauses of this contract, respectively. Notwithstanding any provision of this contract concerning inspection and acceptance, the Government may ignore or, at the Contractor's expense, correct or strike a marking if, in accordance with the procedures of those clauses, a restrictive marking is determined to be unjustified.
                                </P>
                                <P>
                                    (2) 
                                    <E T="03">Nonconforming computer software or computer software documentation markings.</E>
                                     A nonconforming marking is a marking placed on computer software or computer software documentation delivered or otherwise furnished to the Government under this contract that is not in the format authorized by this contract. Correction of nonconforming markings is not subject to the Validation of Asserted Restrictions—Computer Software or the Validation of Restrictive Markings on Technical Data clause of this contract. If the Contracting Officer notifies the Contractor of a nonconforming marking or markings and the Contractor fails to remove or correct such markings within sixty (60) days, the Government may ignore or, at the Contractor's expense, remove or correct any nonconforming markings.
                                </P>
                                <P>
                                    (i) 
                                    <E T="03">Relation to patents.</E>
                                     Nothing contained in this clause shall imply a license to the Government under any patent or be construed as affecting the scope of any license or other right otherwise granted to the Government under any patent.
                                </P>
                                <P>
                                    (j) 
                                    <E T="03">Limitation on charges for rights in computer software or computer software documentation.</E>
                                     (1) The Contractor shall not charge to this contract any cost, including but not limited to license fees, royalties, or similar charges, for rights in computer software or computer software documentation to be delivered under this contract when—
                                    <PRTPAGE P="643"/>
                                </P>
                                <P>(i) The Government has acquired, by any means, the same or greater rights in the software or documentation; or</P>
                                <P>(ii) The software or documentation are available to the public without restrictions.</P>
                                <P>(2) The limitation in paragraph (j)(1) of this clause—</P>
                                <P>(i) Includes costs charged by a subcontractor or supplier, at any tier, or costs incurred by the Contractor to acquire rights in subcontractor or supplier computer software or computer software documentation, if the subcontractor or supplier has been paid for such rights under any other Government contract or under a license conveying the rights to the Government; and</P>
                                <P>(ii) Does not include the reasonable costs of reproducing, handling, or mailing the documents or other media in which the software or documentation will be delivered.</P>
                                <P>
                                    (k) 
                                    <E T="03">Applicability to subcontractors or suppliers.</E>
                                     (1) Whenever any other than commercial computer software  or computer software documentation is to be obtained from a subcontractor or supplier for delivery to the Government under this contract, the Contractor shall use this same clause in its subcontracts or other contractual instruments, and require its subcontractors or suppliers to do so, without alteration, except to identify the parties. No other clause shall be used to enlarge or diminish the Government's, the Contractor's, or a higher tier subcontractor's or supplier's rights in a subcontractor's or supplier's computer software or computer software documentation.
                                </P>
                                <P>(2) The Contractor and higher tier subcontractors or suppliers shall not use their power to award contracts as economic leverage to obtain rights in computer software or computer software documentation from their subcontractors or suppliers.</P>
                                <P>(3) The Contractor shall ensure that subcontractor or supplier rights are recognized and protected in the identification, assertion, and delivery processes required by paragraph (e) of this clause.</P>
                                <P>(4) In no event shall the Contractor use its obligation to recognize and protect subcontractor or supplier rights in computer software or computer software documentation as an excuse for failing to satisfy its contractual obligation to the Government.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate I</E>
                                 (JUN 1995). As prescribed in 227.7203-6(a)(2), add the following paragraph (l) to the basic clause:
                            </P>
                            <EXTRACT>
                                <P>
                                    (l) 
                                    <E T="03">Publication for sale.</E>
                                     (1) This paragraph only applies to computer software or computer software documentation in which the Government has obtained unlimited rights or a license to make an unrestricted release of the software or documentation.
                                </P>
                                <P>(2) The Government shall not publish a deliverable item or items of computer software or computer software documentation identified in this contract as being subject to paragraph (l) of this clause or authorize others to publish such software or documentation on its behalf if, prior to publication for sale by the Government and within twenty-four (24) months following the date specified in this contract for delivery of such software or documentation, or the removal of any national security or export control restrictions, whichever is later, the Contractor publishes that item or items for sale and promptly notifies the Contracting Officer of such publication(s). Any such publication shall include a notice identifying the number of this contract and the Government's rights in the published software or documentation.</P>
                                <P>(3) This limitation on the Government's rights to publish for sale shall continue as long as the software or documentation are reasonably available to the public for purchase.</P>
                            </EXTRACT>
                            <CITA>[60 FR 33493, June 28, 1995, as amended at 76 FR 11368, Mar. 2, 2011; 77 FR 10976, Feb. 24, 2012; 78 FR 30238, May 22, 2013; 79 FR 11341, Feb. 28, 2014; 88 FR 6593, Jan. 31, 2023; 88 FR 17345, Mar. 22, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7015</SECTNO>
                            <SUBJECT>Technical Data—Commercial Products and Commercial Services.</SUBJECT>
                            <P>As prescribed in 227.7102-4(a)(1), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Technical Data—Commercial Products and Commercial Services (MAR 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    (1) 
                                    <E T="03">Commercial product and commercial service</E>
                                     includes commercial components and commercial processes but does not include commercial computer software.
                                </P>
                                <P>
                                    (2) 
                                    <E T="03">Covered Government support contractor</E>
                                     means a contractor (other than a litigation support contractor covered by 252.204-7014) under a contract, the primary purpose of which is to furnish independent and impartial advice or technical assistance directly to the Government in support of the Government's management and oversight of a program or effort (rather than to directly furnish an end item or service to accomplish a program or effort), provided that the contractor—
                                </P>
                                <P>(i) Is not affiliated with the prime contractor or a first-tier subcontractor on the program or effort, or with any direct competitor of such prime contractor or any such first-tier subcontractor in furnishing end items or services of the type developed or produced on the program or effort; and</P>
                                <P>
                                    (ii) Receives access to technical data or computer software for performance of a Government contract that contains the clause at 
                                    <PRTPAGE P="644"/>
                                    252.227-7025, Limitations on the Use or Disclosure of Government-Furnished Information Marked with Restrictive Legends.
                                </P>
                                <P>
                                    (3) 
                                    <E T="03">Form, fit, and function data</E>
                                     means technical data that describes the required overall physical, functional, and performance characteristics (along with the qualification requirements, if applicable) of an item, component, or process to the extent necessary to permit identification of physically and functionally interchangeable items.
                                </P>
                                <P>
                                    (4) 
                                    <E T="03">Technical data</E>
                                     means recorded information, regardless of the form or method of recording, of a scientific or technical nature (including computer software documentation). The term does not include computer software or financial, administrative, cost or pricing, or management information, or information incidental to contract administration.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">License.</E>
                                     (1) The Government shall have the unrestricted right to use, modify, reproduce, release, perform, display, or disclose technical data, and to permit others to do so, that—
                                </P>
                                <P>(i) Have been provided to the Government or others without restrictions on use, modification, reproduction, release, or further disclosure other than a release or disclosure resulting from the sale, transfer, or other assignment of interest in the technical data to another party or the sale or transfer of some or all of a business entity or its assets to another party;</P>
                                <P>(ii) Are form, fit, and function data;</P>
                                <P>(iii) Are a correction or change to technical data furnished to the Contractor by the Government;</P>
                                <P>(iv) Are necessary for operation, maintenance, installation, or training (other than detailed manufacturing or process data); or</P>
                                <P>(v) Have been provided to the Government under a prior contract or licensing agreement through which the Government has acquired the rights to use, modify, reproduce, release, perform, display, or disclose the data without restrictions.</P>
                                <P>(2) Except as provided in paragraph (b)(1) of this clause, the Government may use, modify, reproduce, release, perform, display, or disclose technical data within the Government only. The Government shall not—</P>
                                <P>(i) Use the technical data to manufacture additional quantities of the commercial products; or</P>
                                <P>(ii) Release, perform, display, disclose, or authorize use of the technical data outside the Government without the Contractor's written permission unless a release, disclosure, or permitted use is necessary for emergency repair or overhaul of the commercial products furnished under this contract, or for performance of work by covered Government support contractors.</P>
                                <P>(3) The Contractor acknowledges that—</P>
                                <P>(i) Technical data covered by paragraph (b)(2) of this clause are authorized to be released or disclosed to covered Government support contractors;</P>
                                <P>(ii) The Contractor will be notified of such release or disclosure;</P>
                                <P>
                                    (iii) The Contractor (or the party asserting restrictions as identified in a restrictive legend) may require each such covered Government support contractor to enter into a non-disclosure agreement directly with the Contractor (or the party asserting restrictions) regarding the covered Government support contractor's use of such data, or alternatively, that the Contractor (or party asserting restrictions) may waive in writing the requirement for a
                                    <E T="0511">n</E>
                                     non-disclosure agreement; and
                                </P>
                                <P>(iv) Any such non-disclosure agreement shall address the restrictions on the covered Government support contractor's use of the data as set forth in the clause at 252.227-7025, Limitations on the Use or Disclosure of Government-Furnished Information Marked with Restrictive Legends. The non-disclosure agreement shall not include any additional terms and conditions unless mutually agreed to by the parties to the non-disclosure agreement.</P>
                                <P>
                                    (c) 
                                    <E T="03">Additional license rights.</E>
                                     The Contractor, its subcontractors, and suppliers are not required to provide the Government additional rights to use, modify, reproduce, release, perform, display, or disclose technical data. However, if the Government desires to obtain additional rights in technical data, the Contractor agrees to promptly enter into negotiations with the Contracting Officer to determine whether there are acceptable terms for transferring such rights. All technical data in which the Contractor has granted the Government additional rights shall be listed or described in a special license agreement made part of this contract. The license shall enumerate the additional rights granted the Government in such data.
                                </P>
                                <P>
                                    (d) 
                                    <E T="03">Release from liability.</E>
                                     The Contractor agrees that the Government, and other persons to whom the Government may have released or disclosed technical data delivered or otherwise furnished under this contract, shall have no liability for any release or disclosure of technical data that are not marked to indicate that such data are licensed data subject to use, modification, reproduction, release, performance, display, or disclosure restrictions.
                                </P>
                            </EXTRACT>
                            <P>
                                (e) 
                                <E T="03">Applicability to subcontractors or suppliers.</E>
                                 (1) The Contractor shall recognize and protect the rights afforded its subcontractors and suppliers under 10 U.S.C. 3771-3775 and 10 U.S.C. 3781-3786.
                            </P>
                            <P>
                                (2) Whenever any technical data related to commercial items developed in any part at private expense will be obtained from a subcontractor or supplier 
                                <PRTPAGE P="645"/>
                                for delivery to the Government under this contract, the Contractor shall use this same clause in the subcontract or other contractual instrument, including subcontracts and other contractual instruments for commercial products or commercial services, and require its subcontractors or suppliers to do so, without alteration, except to identify the parties. This clause will govern the technical data pertaining to any portion of a commercial product or commercial service that was developed exclusively at private expense, and the clause at 252.227-7013 will govern the technical data pertaining to any portion of a commercial item that was developed in any part at Government expense.
                            </P>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate I</E>
                                 (MAR 2022) As prescribed in 227.7102-4(a)(2), add the following paragraphs (a)(6) and (b)(4) to the basic clause:
                            </P>
                            <EXTRACT>
                                <P>
                                    (a)(6) 
                                    <E T="03">Vessel design</E>
                                     means the design of a vessel, boat, or craft, and its components, including the hull, decks, superstructure, and the exterior surface shape of all external shipboard equipment and systems. The term includes designs covered by 10 U.S.C. 8687, and designs protectable under 17 U.S.C. 1301, 
                                    <E T="03">et seq.</E>
                                </P>
                                <P>
                                    (b)(4) 
                                    <E T="03">Vessel designs.</E>
                                     For a vessel design (including a vessel design embodied in a useful article) that is developed or delivered under this contract, the Government shall have the right to make and have made any useful article that embodies the vessel design, to import the article, to sell the article, and to distribute the article for sale or to use the article in trade, to the same extent that the Government is granted rights in the technical data pertaining to the vessel design.
                                </P>
                            </EXTRACT>
                            <CITA>[60 FR 33497, June 28, 1995, as amended at 60 FR 61602, Nov. 30, 1995; 74 FR 61045, Nov. 23, 2009; 76 FR 11368, Mar. 2, 2011; 76 FR 58148, Sept. 20, 2011; 76 FR 76320, Dec. 7, 2011; 78 FR 30239, May 22, 2013; 78 FR 37990, June 25, 2013; 79 FR 11341, Feb. 28, 2014; 87 FR 15819, Mar. 18, 2022; 87 FR 76997, Dec. 16, 2022; 88 FR 6594, Jan. 31, 2023; 88 FR 17345, Mar. 22, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7016</SECTNO>
                            <SUBJECT>Rights in Bid or Proposal Information.</SUBJECT>
                            <P>As prescribed in 227.7103-6(e)(1), 227.7104(e)(1), or 227.7203-6(b), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Rights In Bid or Proposal Information (JAN 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                </P>
                                <P>(1) For contracts that require the delivery of technical data, the terms “technical data” and “computer software” are defined in the Rights in Technical Data—Other Than Commercial Products and Commercial Services clause of this contract or, if this is a contract awarded under the Small Business Innovation Research Program, the Rights in Other Than Commercial Technical Data and Computer Software—Small Business Innovation Research (SBIR) Program clause of this contract.</P>
                                <P>(2) For contracts that do not require the delivery of technical data, the term “computer software” is defined in the Rights in Other Than Commercial Computer Software and Other Than Commercial Computer Software Documentation clause of this contract or, if this is a contract awarded under the Small Business Innovation Research Program, the Rights in Other Than Commercial Technical Data and Computer Software—Small Business Innovation Research (SBIR) Program clause of this contract.</P>
                                <P>
                                    (b) 
                                    <E T="03">Government rights to contract award.</E>
                                     By submission of its offer, the Offeror agrees that the Government—
                                </P>
                                <P>(1) May reproduce the bid or proposal, or any portions thereof, to the extent necessary to evaluate the offer.</P>
                                <P>(2) Except as provided in paragraph (d) of this clause, shall use information contained in the bid or proposal only for evaluational purposes and shall not disclose, directly or indirectly, such information to any person including potential evaluators, unless that person has been authorized by the head of the agency, his or her designee, or the Contracting Officer to receive such information.</P>
                                <P>
                                    (c) 
                                    <E T="03">Government rights subsequent to contract award.</E>
                                     The Contractor agrees—
                                </P>
                                <P>(1) Except as provided in paragraphs (c)(2), (d), and (e) of this clause, the Government shall have the rights to use, modify, reproduce, release, perform, display, or disclose information contained in the Contractor's bid or proposal within the Government. The Government shall not release, perform, display, or disclose such information outside the Government without the Contractor's written permission.</P>
                                <P>
                                    (2) The Government's right to use, modify, reproduce, release, perform, display, or disclose information that is technical data or computer software required to be delivered under this contract are determined by the Rights in Technical Data—Other Than Commercial Products and Commercial Services, Rights in Other Than Commercial Computer Software and Other Than Commercial Computer Software Documentation, or Rights in Other Than Commercial Technical Data and 
                                    <PRTPAGE P="646"/>
                                    Computer Software—Small Business Innovation Research (SBIR) Program clause(s) of this contract.
                                </P>
                                <P>
                                    (d) 
                                    <E T="03">Government-furnished information.</E>
                                     The Government's rights with respect to technical data or computer software contained in the Contractor's bid or proposal that were provided to the Contractor by the Government are subject only to restrictions on use, modification, reproduction, release, performance, display, or disclosure, if any, imposed by the developer or licensor of such data or software.
                                </P>
                                <P>
                                    (e) 
                                    <E T="03">Information available without restrictions.</E>
                                     The Government's rights to use, modify, reproduce, release, perform, display, or, disclose information contained in a bid or proposal, including technical data or computer software, and to permit others to do so, shall not be restricted in any manner if such information has been released or disclosed to the Government or to other persons without restrictions other than a release or disclosure resulting from the sale, transfer, or other assignment of interest in the information to another party or the sale or transfer of some or all of a business entity or its assets to another party.
                                </P>
                                <P>
                                    (f) 
                                    <E T="03">Flowdown.</E>
                                     Contractor shall include this clause in all subcontracts or similar contractual instruments and require its subcontractors or suppliers to do so without alteration, except to identify the parties.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[60 FR 33498, June 28, 1995, as amended at 76 FR 3538, Jan. 20, 2011; 88 FR 6594, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7017</SECTNO>
                            <SUBJECT>Identification and Assertion of Use, Release, or Disclosure Restrictions.</SUBJECT>
                            <P>As prescribed in 227.7103-3(b), 227.7104(e)(2), or 227.7203-3(a), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Identification and Assertion of Use, Release, or Disclosure Restrictions (JAN 2023)</HD>
                                <P>(a) The terms used in this provision are defined in the following clause or clauses contained in this solicitation:</P>
                                <P>(1) If a successful offeror will be required to deliver technical data, the Rights in Technical Data—Other Than Commercial Products and Commercial Services clause, or, if this solicitation contemplates a contract under the Small Business Innovation Research Program, the Rights in Other Than Commercial Technical Data and Computer Software—Small Business Innovation Research (SBIR) Program clause.</P>
                                <P>(2) If a successful offeror will not be required to deliver technical data, the Rights in Other Than Commercial Computer Software and Other Than Commercial Computer Software Documentation clause, or, if this solicitation contemplates a contract under the Small Business Innovation Research Program, the Rights in Other Than Commercial Technical Data and Computer Software—Small Business Innovation Research (SBIR) Program clause.</P>
                                <P>(b) The identification and assertion requirements in this provision apply only to technical data, including computer software documents, or computer software to be delivered with other than unlimited rights. For contracts to be awarded under the Small Business Innovation Research Program, the notification requirements do not apply to technical data or computer software that will be generated under the resulting contract. Notification and identification is not required for restrictions based solely on copyright.</P>
                                <P>(c) Offers submitted in response to this solicitation shall identify, to the extent known at the time an offer is submitted to the Government, the technical data or computer software that the Offeror, its subcontractors or suppliers, or potential subcontractors or suppliers, assert should be furnished to the Government with restrictions on use, release, or disclosure.</P>
                                <P>(d) The Offeror's assertions, including the assertions of its subcontractors or suppliers or potential subcontractors or suppliers shall be submitted as an attachment to its offer in the following format, dated and signed by an official authorized to contractually obligate the Offeror:</P>
                                <HD SOURCE="HD3">Identification and Assertion of Restrictions on the Government's Use, Release, or Disclosure of Technical Data or Computer Software</HD>
                                <P>The Offeror asserts for itself, or the persons identified below, that the Government's rights to use, release, or disclose the following technical data or computer software should be restricted:</P>
                                <GPOTABLE COLS="4" OPTS="L2" CDEF="s25,25,25,25">
                                    <BOXHD>
                                        <CHED H="1">Technical Data or Computer Software to be Furnished With Restrictions*</CHED>
                                        <CHED H="1">Basis for Assertion**</CHED>
                                        <CHED H="1">Asserted Rights Category***</CHED>
                                        <CHED H="1">Name of Person Asserting Restrictions****</CHED>
                                    </BOXHD>
                                    <ROW>
                                        <ENT I="11" O="oi0">(LIST)*****</ENT>
                                        <ENT O="oi0">(LIST)</ENT>
                                        <ENT O="oi0">(LIST)</ENT>
                                        <ENT O="oi0">(LIST)</ENT>
                                    </ROW>
                                    <TNOTE>
                                        *For technical data (other than computer software documentation) pertaining to items, components, or processes developed at private expense, identify both the deliverable technical data and each such items, component, or process. For computer software or computer software documentation identify the software or documentation.
                                        <PRTPAGE P="647"/>
                                    </TNOTE>
                                    <TNOTE>**Generally, development at private expense, either exclusively or partially, is the only basis for asserting restrictions. For technical data, other than computer software documentation, development refers to development of the item, component, or process to which the data pertain. The Government's rights in computer software documentation generally may not be restricted. For computer software, development refers to the software. Indicate whether development was accomplished exclusively or partially at private expense. If development was not accomplished at private expense, or for computer software documentation, enter the specific basis for asserting restrictions.</TNOTE>
                                    <TNOTE>***Enter asserted rights category (e.g., government purpose license rights from a prior contract, rights in SBIR data generated under another contract, limited, restricted, or government purpose rights under this or a prior contract, or specially negotiated licenses).</TNOTE>
                                    <TNOTE>****Corporation, individual, or other person, as appropriate.</TNOTE>
                                    <TNOTE>*****Enter “none” when all data or software will be submitted without restrictions.</TNOTE>
                                </GPOTABLE>
                                <FP SOURCE="FP-DASH">Date</FP>
                                <FP SOURCE="FP-DASH">Printed Name and Title</FP>
                                <FP SOURCE="FP-DASH"/>
                                <FP SOURCE="FP-DASH">Signature</FP>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of identification and assertion)</HD>
                            <EXTRACT>
                                <P>(e) An offeror's failure to submit, complete, or sign the notification and identification required by paragraph (d) of this provision with its offer may render the offer ineligible for award.</P>
                                <P>(f) If the Offeror is awarded a contract, the assertions identified in paragraph (d) of this provision shall be listed in an attachment to that contract. Upon request by the Contracting Officer, the Offeror shall provide sufficient information to enable the Contracting Officer to evaluate any listed assertion.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[60 FR 33498, June 28, 1994, as amended at 76 FR 3538, Jan. 20, 2011; 88 FR 6594, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7018</SECTNO>
                            <SUBJECT>Rights in Other Than Commercial Technical Data and Computer Software—Small Business Innovation Research (SBIR) Program.</SUBJECT>
                            <P>As prescribed in 227.7104(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Rights in Other Than Commercial Technical Data and Computer Software—Small Business Innovation Research (SBIR) Program (NOV 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    (1) 
                                    <E T="03">Commercial computer software</E>
                                     means software developed or regularly used for nongovernmental purposes which—
                                </P>
                                <P>(i) Has been sold, leased, or licensed to the public;</P>
                                <P>(ii) Has been offered for sale, lease, or license to the public;</P>
                                <P>(iii) Has not been offered, sold, leased, or licensed to the public but will be available for commercial sale, lease, or license in time to satisfy the delivery requirements of this contract; or</P>
                                <P>(iv) Satisfies a criterion expressed in paragraph (a)(1)(i), (ii), or (iii) of this clause and would require only minor modification to meet the requirements of this contract.</P>
                                <P>
                                    (2) 
                                    <E T="03">Computer database</E>
                                     means a collection of recorded data in a form capable of being processed by a computer. The term does not include computer software.
                                </P>
                                <P>
                                    (3) 
                                    <E T="03">Computer program</E>
                                     means a set of instructions, rules, or routines, recorded in a form that is capable of causing a computer to perform a specific operation or series of operations.
                                </P>
                                <P>
                                    (4) 
                                    <E T="03">Computer software</E>
                                     means computer programs, source code, source code listings, object code listings, design details, algorithms, processes, flow charts, formulae, and related material that would enable the software to be reproduced, re-created, or recompiled. Computer software does not include computer databases or computer software documentation.
                                </P>
                                <P>
                                    (5) 
                                    <E T="03">Computer software documentation</E>
                                     means owner's manuals, user's manuals, installation instructions, operating instructions, and other similar items, regardless of storage medium, that explain the capabilities of the computer software or provide instructions for using the software.
                                </P>
                                <P>
                                    (6) 
                                    <E T="03">Covered Government support contractor</E>
                                     means a contractor (other than a litigation support contractor covered by 252.204-7014) under a contract, the primary purpose of which is to furnish independent and impartial advice or technical assistance directly to the Government in support of the Government's management and oversight of a program or effort (rather than to directly furnish an end item or service to accomplish a program or effort), provided that the contractor—
                                </P>
                                <P>(i) Is not affiliated with the prime contractor or a first-tier subcontractor on the program or effort, or with any direct competitor of such prime contractor or any such first-tier subcontractor in furnishing end items or services of the type developed or produced on the program or effort; and</P>
                                <P>(ii) Receives access to the technical data or computer software for performance of a Government contract that contains the clause at 252.227-7025, Limitations on the Use or Disclosure of Government-Furnished Information Marked with Restrictive Legends.</P>
                                <P>
                                    (7) 
                                    <E T="03">Detailed manufacturing or process data</E>
                                     means technical data that describe the steps, sequences, and conditions of manufacturing, 
                                    <PRTPAGE P="648"/>
                                    processing or assembly used by the manufacturer to produce an item or component or to perform a process.
                                </P>
                                <P>
                                    (8) 
                                    <E T="03">Developed</E>
                                     means—
                                </P>
                                <P>(i) (Applicable to technical data other than computer software documentation.) An item, component, or process, exists and is workable. Thus, the item or component must have been constructed or the process practiced. Workability is generally established when the item, component, or process has been analyzed or tested sufficiently to demonstrate to reasonable people skilled in the applicable art that there is a high probability that it will operate as intended. Whether, how much, and what type of analysis or testing is required to establish workability depends on the nature of the item, component, or process, and the state of the art. To be considered “developed,” the item, component, or process need not be at the stage where it could be offered for sale or sold on the commercial market, nor must the item, component or process be actually reduced to practice within the meaning of Title 35 of the United States Code;</P>
                                <P>(ii) A computer program has been successfully operated in a computer and tested to the extent sufficient to demonstrate to reasonable persons skilled in the art that the program can reasonably be expected to perform its intended purpose;</P>
                                <P>(iii) Computer software, other than computer programs, has been tested or analyzed to the extent sufficient to demonstrate to reasonable persons skilled in the art that the software can reasonably be expected to perform its intended purpose; or</P>
                                <P>(iv) Computer software documentation required to be delivered under a contract has been written, in any medium, in sufficient detail to comply with requirements under that contract.</P>
                                <P>
                                    (9) 
                                    <E T="03">Developed exclusively at private expense</E>
                                     means development was accomplished entirely with costs charged to indirect cost pools, costs not allocated to a government contract, or any combination thereof.
                                </P>
                                <P>(i) Private expense determinations should be made at the lowest practicable level.</P>
                                <P>(ii) Under fixed-price contracts, when total costs are greater than the firm-fixed-price or ceiling price of the contract, the additional development costs necessary to complete development shall not be considered when determining whether development was at government, private, or mixed expense.</P>
                                <P>
                                    (10) 
                                    <E T="03">Developed exclusively with government funds</E>
                                     means development was not accomplished exclusively or partially at private expense.
                                </P>
                                <P>
                                    (11) 
                                    <E T="03">Developed with mixed funding</E>
                                     means development was accomplished partially with costs charged to indirect cost pools and/or costs not allocated to a government contract, and partially with costs charged directly to a government contract.
                                </P>
                                <P>
                                    (12) 
                                    <E T="03">Form, fit, and function data</E>
                                     means technical data that describe the required overall physical, functional, and performance characteristics (along with the qualification requirements, if applicable) of an item, component, or process to the extent necessary to permit identification of physically and functionally interchangeable items.
                                </P>
                                <P>
                                    (13) 
                                    <E T="03">Generated</E>
                                     means technical data or computer software first created in the performance of this contract.
                                </P>
                                <P>
                                    (14) 
                                    <E T="03">Government purpose</E>
                                     means any activity in which the United States Government is a party, including cooperative agreements with international or multi-national defense organizations or sales or transfers by the United States Government to foreign governments or international organizations. Government purposes include competitive procurement, but do not include the rights to use, modify, reproduce, release, perform, display, or disclose technical data or computer software for commercial purposes or authorize others to do so.
                                </P>
                                <P>(15) “Limited rights” means the rights to use, modify, reproduce, release, perform, display, or disclose technical data, in whole or in part, within the Government. The Government may not, without the written permission of the party asserting limited rights, release or disclose the technical data outside the Government, use the technical data for manufacture, or authorize the technical data to be used by another party, except that the Government may reproduce, release, or disclose such data or authorize the use or reproduction of the data by persons outside the Government if—</P>
                                <P>(i) The reproduction, release, disclosure, or use is—</P>
                                <P>(A) Necessary for emergency repair and overhaul; or</P>
                                <P>(B) A release or disclosure to—</P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) A covered Government support contractor in performance of its covered Government support contracts for use, modification, reproduction, performance, display, or release or disclosure to a person authorized to receive limited rights technical data; or
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) A foreign government, of technical data other than detailed manufacturing or process data, when use of such data by the foreign government is in the interest of the Government and is required for evaluational or informational purposes;
                                </P>
                                <P>(ii) The recipient of the technical data is subject to a prohibition on the further reproduction, release, disclosure, or use of the technical data; and</P>
                                <P>(iii) The contractor or subcontractor asserting the restriction is notified of such reproduction, release, disclosure, or use.</P>
                                <P>
                                    (16) 
                                    <E T="03">Minor modification</E>
                                     means a modification that does not significantly alter the nongovernmental function or purpose of 
                                    <PRTPAGE P="649"/>
                                    computer software or is of the type customarily provided in the commercial marketplace.
                                </P>
                                <P>
                                    (17) 
                                    <E T="03">Other than commercial computer software</E>
                                     means software that does not qualify as commercial computer software under the definition of “commercial computer software” of this clause.
                                </P>
                                <P>
                                    (18) 
                                    <E T="03">Restricted rights</E>
                                     apply only to other than commercial computer software and mean the Government's rights to—
                                </P>
                                <P>(i) Use a computer program with one computer at one time. The program may not be accessed by more than one terminal or central processing unit or time shared unless otherwise permitted by this contract;</P>
                                <P>(ii) Transfer a computer program to another Government agency without the further permission of the Contractor if the transferor destroys all copies of the program and related computer software documentation in its possession and notifies the licensor of the transfer. Transferred programs remain subject to the provisions of this clause;</P>
                                <P>(iii) Make a reasonable number of copies of the computer software required for the purposes of safekeeping (archive), backup, modification, or other activities authorized in paragraphs (a)(18)(i), (ii), and (iv) through (vii) of this clause;</P>
                                <P>(iv) Modify computer software provided that the Government may—</P>
                                <P>(A) Use the modified software only as provided in paragraphs (a)(18)(i) and (iii) of this clause; and</P>
                                <P>(B) Not release or disclose the modified software except as provided in paragraphs (a)(18)(ii), (v), (vi), and (vii) of this clause;</P>
                                <P>(v) Use, and permit contractors or subcontractors performing service contracts (see 37.101 of the Federal Acquisition Regulation) in support of this or a related contract to use, computer software to diagnose and correct deficiencies in a computer program, to modify computer software to enable a computer program to be combined with, adapted to, or merged with other computer programs or when necessary to respond to urgent tactical situations, provided that—</P>
                                <P>(A) The Government notifies the party which has granted restricted rights that any such release or disclosure to particular contractors or subcontractors was made;</P>
                                <P>(B) Such contractors or subcontractors are subject to the nondisclosure agreement at 227.7103-7 of the Defense Federal Acquisition Regulation Supplement or are Government contractors receiving access to the software for performance of a Government contract that contains the clause at 252.227-7025, Limitations on the Use or Disclosure of Government-Furnished Information Marked with Restrictive Legends;</P>
                                <P>(C) The Government shall not permit the recipient to decompile, disassemble, or reverse engineer the software, or use software decompiled, disassembled, or reverse engineered by the Government pursuant to paragraph (a)(18)(iv) of this clause, for any other purpose; and</P>
                                <P>(D) Such use is subject to the limitations in paragraphs (a)(18)(i) through (iii) of this clause;</P>
                                <P>(vi) Use, and permit contractors or subcontractors performing emergency repairs or overhaul of items or components of items procured under this or a related contract to use, the computer software when necessary to perform the emergency repairs or overhaul, or to modify the computer software to reflect the repairs or overhaul made, provided that—</P>
                                <P>(A) The intended recipient is subject to the nondisclosure agreement at 227.7103-7 or is a Government contractor receiving access to the software for performance of a Government contract that contains the clause at 252.227-7025, Limitations on the Use or Disclosure of Government Furnished Information Marked with Restrictive Legends;</P>
                                <P>(B) The Government shall not permit the recipient to decompile, disassemble, or reverse engineer the software, or use software decompiled, disassembled, or reverse engineered by the Government pursuant to paragraph (a)(18)(iv) of this clause, for any other purpose; and</P>
                                <P>(C) Such use is subject to the limitations in paragraphs (a)(18)(i) through (iii) of this clause; and</P>
                                <P>(vii) Use, modify, reproduce, perform, display, or release or disclose computer software to a person authorized to receive restricted rights computer software for management and oversight of a program or effort, and permit covered Government support contractors in the performance of covered Government support contracts that contain the clause at 252.227-7025, Limitations on the Use or Disclosure of Government-Furnished Information Marked with Restrictive Legends, to use, modify, reproduce, perform, display, or release or disclose the computer software to a person authorized to receive restricted rights computer software, provided that—</P>
                                <P>(A) The Government shall not permit the covered Government support contractor to decompile, disassemble, or reverse engineer the software, or use software decompiled, disassembled, or reverse engineered by the Government pursuant to paragraph (a)(18)(iv) of this clause, for any other purpose; and</P>
                                <P>(B) Such use is subject to the limitations in paragraphs (a)(18)(i) through (iv) of this clause.</P>
                                <P>
                                    (19) “SBIR data rights” means the Government's rights during the SBIR data protection period (specified in paragraph (b)(4) of this clause) to use, modify, reproduce, release, perform, display, or disclose technical data or computer software generated a SBIR award as follows:
                                    <PRTPAGE P="650"/>
                                </P>
                                <P>(i) Limited rights in such SBIR technical data; and</P>
                                <P>(ii) Restricted rights in such SBIR computer software.</P>
                                <P>
                                    (20) 
                                    <E T="03">Technical data</E>
                                     means recorded information, regardless of the form or method of the recording, of a scientific or technical nature (including computer software documentation). The term does not include computer software or financial, administrative, cost or pricing, or management information, or information incidental to contract administration.
                                </P>
                                <P>
                                    (21) 
                                    <E T="03">Unlimited rights</E>
                                     means rights to use, modify, reproduce, release, perform, display, or disclose, technical data or computer software in whole or in part, in any manner and for any purpose whatsoever, and to have or authorize others to do so.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Rights in technical data and computer software.</E>
                                     The Contractor grants or shall obtain for the Government the following royalty-free, worldwide , nonexclusive, irrevocable license rights in technical data or other than commercial computer software . All rights not granted to the Government are retained by the Contractor.
                                </P>
                                <P>
                                    (1) 
                                    <E T="03">Unlimited rights.</E>
                                     The Government shall have unlimited rights in technical data, including computer software documentation, or computer software generated under this contract that are—
                                </P>
                                <P>(i) Form, fit, and function data;</P>
                                <P>(ii) Necessary for installation, operation, maintenance, or training purposes (other than detailed manufacturing or process data);</P>
                                <P>(iii) Corrections or changes to Government-furnished technical data or computer software;</P>
                                <P>(iv) Otherwise publicly available or have been released or disclosed by the Contractor or a subcontractor without restrictions on further use, release or disclosure other than a release or disclosure resulting from the sale, transfer, or other assignment of interest in the technical data or computer software to another party or the sale or transfer of some or all of a business entity or its assets to another party;</P>
                                <P>(v) Data or software in which the Government has acquired previously unlimited rights under another Government contract or through a specific license; and</P>
                                <P>(vi) SBIR data upon expiration of the SBIR data rights period.</P>
                                <P>
                                    (2) 
                                    <E T="03">Limited rights.</E>
                                     The Government shall have limited rights in technical data, that were not generated under this contract, pertain to items, components or processes developed exclusively at private expense, and are marked, in accordance with the marking instructions in paragraph (f)(1) of this clause, with the legend prescribed in paragraph (f)(2) of this clause.
                                </P>
                                <P>
                                    (3) 
                                    <E T="03">Restricted rights in computer software.</E>
                                     The Government shall have restricted rights in other than commercial computer software  required to be delivered or otherwise furnished to the Government under this contract that were developed exclusively at private expense and were not generated under this contract.
                                </P>
                                <P>
                                    (4) 
                                    <E T="03">SBIR data rights.</E>
                                     Except for technical data, including computer software documentation, or computer software in which the Government has unlimited rights under paragraph (b)(1) of this clause, the Government shall have SBIR data rights in all technical data or computer software generated under this contract during the period commencing with contract award and ending upon the date five years after completion of the project from which such data were generated.
                                </P>
                                <P>(5) Specifically negotiated license rights. The standard license rights granted to the Government under paragraphs (b)(1) through (b)(4) of this clause may be modified by mutual agreement to provide such rights as the parties consider appropriate but shall not provide the Government lesser rights in technical data, including computer software documentation, than are enumerated in paragraph (a)(15) of this clause or lesser rights in computer software than are enumerated in paragraph (a)(18) of this clause. Any rights so negotiated shall be identified in a license agreement made part of this contract.</P>
                                <P>
                                    (6) 
                                    <E T="03">Prior government rights.</E>
                                     Technical data, including computer software documentation, or computer software that will be delivered, furnished, or otherwise provided to the Government under this contract, in which the Government has previously obtained rights shall be delivered, furnished, or provided with the pre-existing rights, unless—
                                </P>
                                <P>(i) The parties have agreed otherwise; or</P>
                                <P>(ii) Any restrictions on the Government's rights to use, modify, release, perform, display, or disclose the technical data or computer software have expired or no longer apply.</P>
                                <P>
                                    (7) 
                                    <E T="03">Release from liability.</E>
                                     The Contractor agrees to release the Government from liability for any release or disclosure of technical data, computer software, or computer software documentation made in accordance with paragraph (a)(14), (a)(17), or (b)(4) of this clause, or in accordance with the terms of a license negotiated under paragraph (b)(5) of this clause, or by others to whom the recipient has released or disclosed the data, software, or documentation and to seek relief solely from the party who has improperly used, modified, reproduced, released, performed, displayed, or disclosed Contractor data or software marked with restrictive legends.
                                </P>
                                <P>
                                    (8) 
                                    <E T="03">Covered Government support contractors.</E>
                                     The Contractor acknowledges that—
                                    <PRTPAGE P="651"/>
                                </P>
                                <P>(i) Limited rights technical data and restricted rights computer software are authorized to be released or disclosed to covered Government support contractors;</P>
                                <P>(ii) The Contractor will be notified of such release or disclosure;</P>
                                <P>(iii) The Contractor may require each such covered Government support contractor to enter into a non-disclosure agreement directly with the Contractor (or the party asserting restrictions as identified in a restrictive legend) regarding the covered Government support contractor's use of such data or software, or alternatively that the Contractor (or party asserting restrictions) may waive in writing the requirement for a non-disclosure agreement; and</P>
                                <P>(iv) Any such non-disclosure agreement shall address the restrictions on the covered Government support contractor's use of the data or software as set forth in the clause at 252.227-7025, Limitations on the Use or Disclosure of Government-Furnished Information Marked with Restrictive Legends. The non-disclosure agreement shall not include any additional terms and conditions unless mutually agreed to by the parties to the non-disclosure agreement.</P>
                                <P>
                                    (c) 
                                    <E T="03">Rights in derivative computer software or computer software documentation.</E>
                                     The Government shall retain its rights in the unchanged portions of any computer software or computer software documentation delivered under this contract that the Contractor uses to prepare, or includes in, derivative software or documentation.
                                </P>
                                <P>
                                    (d) 
                                    <E T="03">Third party copyrighted technical data and computer software.</E>
                                     The Contractor shall not, without the written approval of the Contracting Officer, incorporate any copyrighted technical data, including computer software documentation, or computer software in the data or software to be delivered under this contract unless the Contractor is the copyright owner or has obtained for the Government the license rights necessary to perfect a license or licenses in the deliverable data or software of the appropriate scope set forth in paragraph (b) of this clause and, prior to delivery of such—
                                </P>
                                <P>(1) Technical data, has affixed to the transmittal document a statement of the license rights obtained; or</P>
                                <P>(2) Computer software, has provided a statement of the license rights obtained in a form acceptable to the Contracting Officer.</P>
                                <P>
                                    (e) 
                                    <E T="03">Identification and delivery of technical data or computer software to be furnished with restrictions on use, release, or disclosure.</E>
                                     (1) This paragraph does not apply to technical data or computer software that were or will be generated under this contract or to restrictions based solely on copyright.
                                </P>
                                <P>(2) Except as provided in paragraph (e)(3) of this clause, technical data or computer software that the Contractor asserts should be furnished to the Government with restrictions on use, release, or disclosure is identified in an attachment to this contract (the Attachment). The Contractor shall not deliver any technical data or computer software with restrictive markings unless the technical data or computer software are listed on the Attachment.</P>
                                <P>(3) In addition to the assertions made in the Attachment, other assertions may be identified after award when based on new information or inadvertent omissions unless the inadvertent omissions would have materially affected the source selection decision. Such identification and assertion shall be submitted to the Contracting Officer as soon as practicable prior to the scheduled date for delivery of the technical data or computer software, in the following format, and signed by an official authorized to contractually obligate the Contractor:</P>
                                <HD SOURCE="HD3">Identification and Assertion of Restrictions on the Government's Use, Release, or Disclosure of Technical Data or Computer Software</HD>
                                <P>The Contractor asserts for itself, or the persons identified below, that the Government's rights to use, release, or disclose the following technical data or computer software should be restricted:</P>
                                <GPOTABLE COLS="4" OPTS="L2" CDEF="s25,xs36,xs36,xs36">
                                    <BOXHD>
                                        <CHED H="1">
                                            Technical data or computer software to be furnished with restrictions 
                                            <SU>1</SU>
                                        </CHED>
                                        <CHED H="1">
                                            Basis for assertion 
                                            <SU>2</SU>
                                        </CHED>
                                        <CHED H="1">
                                            Asserted rights category 
                                            <SU>3</SU>
                                        </CHED>
                                        <CHED H="1">
                                            Name of person asserting restrictions 
                                            <SU>4</SU>
                                        </CHED>
                                    </BOXHD>
                                    <ROW>
                                        <ENT I="01">(LIST)</ENT>
                                        <ENT>(LIST)</ENT>
                                        <ENT>(LIST)</ENT>
                                        <ENT>(LIST)</ENT>
                                    </ROW>
                                    <TNOTE>
                                        <SU>1</SU>
                                         If the assertion is applicable to items, components, or processes developed at private expense, identify both the technical data and each such item, component, or process.
                                    </TNOTE>
                                    <TNOTE>
                                        <SU>2</SU>
                                         Generally, development at private expense, either exclusively or partially, is the only basis for asserting restrictions on the Government's rights to use, release, or disclose technical data or computer software. Indicate whether development was exclusively or partially at private expense. If development was not at private expense, enter the specific reason for asserting that the Government's rights should be restricted.
                                    </TNOTE>
                                    <TNOTE>
                                        <SU>3</SU>
                                         Enter asserted rights category (e.g., limited rights, restricted rights, government purpose rights, or government purpose license rights from a prior contract, SBIR data rights under another contract, or specifically negotiated licenses).
                                    </TNOTE>
                                    <TNOTE>
                                        <SU>4</SU>
                                         Corporation, individual, or other person, as appropriate.
                                    </TNOTE>
                                </GPOTABLE>
                                <FP SOURCE="FP-DASH">Date</FP>
                                <FP SOURCE="FP-DASH">Printed Name and Title</FP>
                                <FP SOURCE="FP-DASH">Signature</FP>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of identification and assertion)</HD>
                            <EXTRACT>
                                <P>
                                    (4) When requested by the Contracting Officer, the Contractor shall provide sufficient information to enable the Contracting Officer to evaluate the Contractor's assertions. The Contracting Officer reserves the right to add the Contractor's assertions to the Attachment and validate any listed assertions, at a later date, in accordance with the procedures of the Validation of Asserted Restrictions—Computer Software and/or Validation 
                                    <PRTPAGE P="652"/>
                                    of Restrictive Markings on Technical Data clauses of this contract.
                                </P>
                                <P>
                                    (f) 
                                    <E T="03">Marking requirements.</E>
                                     The Contractor, and its subcontractors or suppliers, may only assert restrictions on the Government's rights to use, modify, reproduce, release, perform, display, or disclose technical data or computer software to be delivered under this contract by marking the deliverable data or software subject to restriction. Except as provided in paragraph (f)(6) of this clause, only the following markings are authorized under this contract: the limited rights legend at paragraph (f)(2) of this clause; the restricted rights legend at paragraph (f)(3) of this clause, the SBIR data rights legend at paragraph (f)(4) of this clause, or the special license rights legend at paragraphs (f)(5) of this clause; and/or a notice of copyright as prescribed under 17 U.S.C. 401 or 402.
                                </P>
                                <P>
                                    (1) 
                                    <E T="03">General marking instructions.</E>
                                     The Contractor, or its subcontractors or suppliers, shall conspicuously and legibly mark the appropriate legend to all technical data and computer software that qualify for such markings. The authorized legends shall be placed on the transmittal document or storage container and, for printed material, each page of the printed material containing technical data or computer software for which restrictions are asserted. When only portions of a page of printed material are subject to the asserted restrictions, such portions shall be identified by circling, underscoring, with a note, or other appropriate identifier. Technical data or computer software transmitted directly from one computer or computer terminal to another shall contain a notice of asserted restrictions. However, instructions that interfere with or delay the operation of computer software in order to display a restrictive rights legend or other license statement at any time prior to or during use of the computer software, or otherwise cause such interference or delay, shall not be inserted in software that will or might be used in combat or situations that simulate combat conditions, unless the Contracting Officer's written permission to deliver such software has been obtained prior to delivery. Reproductions of technical data, computer software, or any portions thereof subject to asserted restrictions shall also reproduce the asserted restrictions.
                                </P>
                                <P>
                                    (2) 
                                    <E T="03">Limited rights markings.</E>
                                     Technical data not generated under this contract that pertain to items, components, or processes developed exclusively at private expense and delivered or otherwise furnished with limited rights shall be marked with the following legend:
                                </P>
                                <HD SOURCE="HD3">Limited Rights</HD>
                                <FP SOURCE="FP-DASH">Contract No.</FP>
                                <FP SOURCE="FP-DASH">Contractor Name</FP>
                                <FP SOURCE="FP-DASH">Contractor Address</FP>
                                <FP SOURCE="FP-DASH"/>
                                <FP>The Government's rights to use, modify, reproduce, release, perform, display, or disclose these technical data are restricted by paragraph (b)(2) of the  Rights in Other Than Commercial Technical Data and Computer Software—Small Business Innovation Research (SBIR) Program clause contained in the above identified contract. Any reproduction of technical data or portions thereof marked with this legend must also reproduce the markings. Any person, other than the Government, who has been provided access to such data must promptly notify the above named Contractor.</FP>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of legend)</HD>
                            <EXTRACT>
                                <P>
                                    (3) 
                                    <E T="03">Restricted rights markings.</E>
                                     Computer software delivered or otherwise furnished to the Government with restricted rights shall be marked with the following legend:
                                </P>
                                <HD SOURCE="HD3">Restricted Rights</HD>
                                <FP SOURCE="FP-DASH">Contract No.</FP>
                                <FP SOURCE="FP-DASH">Contractor Name</FP>
                                <FP SOURCE="FP-DASH">Contractor Address</FP>
                                <FP SOURCE="FP-DASH"/>
                                <FP>The Government's rights to use, modify, reproduce, release, perform, display, or disclose this software are restricted by paragraph (b)(3) of the Rights in Other Than Commercial Technical Data and Computer Software—Small Business Innovation Research (SBIR) Program clause contained in the above identified contract. Any reproduction of computer software or portions thereof marked with this legend must also reproduce the markings. Any person, other than the Government, who has been provided access to such data must promptly notify the above named Contractor.</FP>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of legend)</HD>
                            <EXTRACT>
                                <P>
                                    (4) 
                                    <E T="03"> SBIR data rights markings.</E>
                                     Except for technical data or computer software in which the Government has acquired unlimited rights under paragraph (b)(1) of this clause, or negotiated special license rights as provided in paragraph (b)(5) of this clause, technical data or computer software generated under this contract shall be marked with the following legend. The Contractor shall enter the expiration date for the SBIR data rights period on the legend:
                                </P>
                                <HD SOURCE="HD3">SBIR Data Rights</HD>
                                <FP SOURCE="FP-DASH">Contract No.</FP>
                                <FP SOURCE="FP-DASH">Contractor Name</FP>
                                <FP SOURCE="FP-DASH">Address</FP>
                                <FP SOURCE="FP-DASH"/>
                                <FP SOURCE="FP-DASH">Expiration of SBIR Data Rights Period</FP>
                                <PRTPAGE P="653"/>
                                <FP>The Government's rights to use, modify, reproduce, release, perform, display, or disclose technical data or computer software marked with this legend are restricted during the period shown as provided in paragraph (b)(4) of the Rights in Other Than Commercial Technical Data and Computer Software—Small Business Innovation Research (SBIR) Program  clause contained in the above identified contract. No restrictions apply after the expiration date shown above. Any reproduction of technical data, computer software, or portions thereof marked with this legend must also reproduce the markings.</FP>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of legend)</HD>
                            <EXTRACT>
                                <P>
                                    (5) 
                                    <E T="03">Special license rights markings.</E>
                                     (i) Technical data or computer software in which the Government's rights stem from a specifically negotiated license shall be marked with the following legend:
                                </P>
                                <HD SOURCE="HD3">Special License Rights</HD>
                                <P>The Government's rights to use, modify, reproduce, release, perform, display, or disclose this technical data or computer software are restricted by Contract No. ________________ (Insert contract number) ________________, License No. ________________ (Insert license identifier) ________________. Any reproduction of technical data, computer software, or portions thereof marked with this legend must also reproduce the markings.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of legend)</HD>
                            <EXTRACT>
                                <P>(ii) For purposes of this clause, special licenses do not include government purpose license rights acquired under a prior contract (see paragraph (b)(6) of this clause).</P>
                                <P>
                                    (6) 
                                    <E T="03">Pre-existing data markings.</E>
                                     If the terms of a prior contract or license permitted the Contractor to restrict the Government's rights to use, modify, reproduce, release, perform, display, or disclose technical data or computer software, and those restrictions are still applicable, the Contractor may mark such data or software with the appropriate restrictive legend for which the data or software qualified under the prior contract or license. The marking procedures in paragraph (f)(1) of this clause shall be followed.
                                </P>
                                <P>
                                    (g) 
                                    <E T="03">Contractor procedures and records.</E>
                                     Throughout performance of this contract, the Contractor, and its subcontractors or suppliers that will deliver technical data or computer software with other than unlimited rights, shall—
                                </P>
                                <P>(1) Have, maintain, and follow written procedures sufficient to assure that restrictive markings are used only when authorized by the terms of this clause; and</P>
                                <P>(2) Maintain records sufficient to justify the validity of any restrictive markings on technical data or computer software delivered under this contract.</P>
                                <P>
                                    (h) 
                                    <E T="03">Removal of unjustified and nonconforming markings</E>
                                    —(1) 
                                    <E T="03">Unjustified markings.</E>
                                     The rights and obligations of the parties regarding the validation of restrictive markings on technical data or computer software furnished or to be furnished under this contract are contained in the Validation of Restrictive Markings on Technical Data and the Validation of Asserted Restrictions—Computer Software clauses of this contract, respectively. Notwithstanding any provision of this contract concerning inspection and acceptance, the Government may ignore or, at the Contractor's expense, correct or strike a marking if, in accordance with the applicable procedures of those clauses, a restrictive marking is determined to be unjustified.
                                </P>
                                <P>
                                    (2) 
                                    <E T="03">Nonconforming markings.</E>
                                     A nonconforming marking is a marking placed on technical data or computer software delivered or otherwise furnished to the Government under this contract that is not in the format authorized by this contract. Correction of nonconforming markings is not subject to the Validation of Restrictive Markings on Technical Data or the Validation of Asserted Restrictions—Computer Software clause of this contract. If the Contracting Officer notifies the Contractor of a nonconforming marking or markings and the Contractor fails to remove or correct such markings within sixty days, the Government may ignore or, at the Contractor's expense, remove or correct any nonconforming markings.
                                </P>
                                <P>
                                    (i) 
                                    <E T="03">Relation to patents.</E>
                                     Nothing contained in this clause shall imply a license to the Government under any patent or be construed as affecting the scope of any license or other right otherwise granted to the Government under any patent.
                                </P>
                                <P>
                                    (j) 
                                    <E T="03">Limitation on charges for rights in technical data or computer software.</E>
                                     (1) The Contractor shall not charge to this contract any cost, including but not limited to, license fees, royalties, or similar charges, for rights in technical data or computer software to be delivered under this contract when—
                                </P>
                                <P>(i) The Government has acquired, by any means, the same or greater rights in the data or software; or</P>
                                <P>(ii) The data are available to the public without restrictions.</P>
                                <P>(2) The limitation in paragraph (j)(1) of this clause—</P>
                                <P>
                                    (i) Includes costs charged by a subcontractor or supplier, at any tier, or costs incurred by the Contractor to acquire rights in subcontractor of supplier technical data or computer software, if the subcontractor or supplier has been paid for such rights under any other Government contract or under a 
                                    <PRTPAGE P="654"/>
                                    license conveying the rights to the Government; and
                                </P>
                                <P>(ii) Does not include the reasonable costs of reproducing, handling, or mailing the documents or other media in which the technical data or computer software will be delivered.</P>
                                <P>
                                    (k) 
                                    <E T="03">Applicability to subcontractors or suppliers.</E>
                                     (1) The Contractor shall assure that the rights afforded its subcontractors and suppliers under 10 U.S.C. 3771-3775, 10 U.S.C. 3781-3786, and the identification, assertion, and delivery processes required by paragraph (e) of this clause are recognized and protected.
                                </P>
                                <P>(2) Whenever any other than commercial technical data or computer software is to be obtained from a subcontractor or supplier for delivery to the Government under this contract, the Contractor shall use this same clause in the subcontract or other contractual instrument, and require its subcontractors or suppliers to do so, without alteration, except to identify the parties. The Contractor shall use the Technical Data—Commercial Products and Commercial Services clause of this contract to obtain technical data pertaining to commercial products, commercial components, commercial services, or commercial processes. No other clause shall be used to enlarge or diminish the Government's, the Contractor's, or a higher tier subcontractor's or supplier's rights in a subcontractor's or supplier's technical data or computer software.</P>
                                <P>(3) Technical data required to be delivered by a subcontractor or supplier shall normally be delivered to the next higher tier contractor, subcontractor, or supplier. However, when there is a requirement in the prime contract for technical data which may be submitted with other than unlimited rights by a subcontractor or supplier, then said subcontractor or supplier may fulfill its requirement by submitting such technical data directly to the Government, rather than through a higher tier contractor, subcontractor, or supplier.</P>
                                <P>(4) The Contractor and higher tier subcontractors or suppliers shall not use their power to award contracts as economic leverage to obtain rights in technical data or computer software from their subcontractors or suppliers.</P>
                                <P>(5) In no event shall the Contractor use its obligation to recognize and protect subcontractor or supplier rights in technical data or computer software as an excuse for failing to satisfy its contractual obligation to the Government.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate I</E>
                                 (JUN 1995). As prescribed in 227.7104(d), add the following paragraph (l) to the basic clause:
                            </P>
                            <EXTRACT>
                                <P>
                                    (l) 
                                    <E T="03">Publication for sale.</E>
                                     (1) This paragraph applies only to technical data or computer software delivered to the Government with SBIR data rights.
                                </P>
                                <P>(2) Upon expiration of the SBIR data rights period, the Government will not exercise its right to publish or authorize others to publish an item of technical data or computer software identified in this contract as being subject to paragraph (l) of this clause if the Contractor, prior to the expiration of the SBIR data rights period, or within two years following delivery of the data or software item, or within twenty-four months following the removal of any national security or export control restrictions, whichever is later, publishes such data or software item(s) and promptly notifies the Contracting Officer of such publication(s). Any such publication(s) shall include a notice identifying the number of this contract and the Government's rights in the published data.</P>
                                <P>(3) This limitation on the Government's right to publish for sale shall continue as long as the technical data or computer software are reasonably available to the public for purchase.</P>
                            </EXTRACT>
                            <CITA>[60 FR 33499, June 28, 1995, as amended at 60 FR 61602, Nov. 30, 1995; 76 FR 3538, Jan. 20, 2011; 76 FR 11369, Mar. 2, 2011; 78 FR 30239, May 22, 2013; 79 FR 11341, Feb. 28, 2014; 87 FR 76997, Dec. 16, 2022; 88 FR 6594, Jan. 31, 2023; 88 FR 17345, Mar. 22, 2023; 88 FR 80467, Nov. 17, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7019</SECTNO>
                            <SUBJECT>Validation of Asserted Restrictions—Computer Software.</SUBJECT>
                            <P>As prescribed in 227.7104(e)(3) or 227.7203-6(c), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Validation of Asserted Restrictions—Computer Software (JAN 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     (1) As used in this clause, unless otherwise specifically indicated, the term “Contractor” means the Contractor and its subcontractors or suppliers.
                                </P>
                                <P>(2) Other terms used in this clause are defined in the Rights in Other Than Commercial Computer Software and Other Than Commercial Computer Software Documentation clause of this contract.</P>
                                <P>
                                    (b) 
                                    <E T="03">Justification.</E>
                                     The Contractor shall maintain records sufficient to justify the validity of any markings that assert restrictions on the Government's rights to use, modify, reproduce, perform, display, release, or disclose computer software delivered or required to be delivered under this contract and shall be prepared to furnish to the Contracting Officer a written justification for such restrictive markings in response to a request for information under paragraph (d) or a challenge under paragraph (f) of this clause.
                                    <PRTPAGE P="655"/>
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Direct contact with subcontractors or suppliers.</E>
                                     The Contractor agrees that the Contracting Officer may transact matters under this clause directly with subcontractors or suppliers at any tier who assert restrictions on the Government's right to use, modify, reproduce, release, perform, display, or disclose computer software. Neither this clause, nor any action taken by the Government under this clause, creates or implies privity of contract between the Government and the Contractor's subcontractors or suppliers.
                                </P>
                                <P>
                                    (d) 
                                    <E T="03">Requests for information.</E>
                                     (1) The Contracting Officer may request the Contractor to provide sufficient information to enable the Contracting Officer to evaluate the Contractor's asserted restrictions. Such information shall be based upon the records required by this clause or other information reasonably available to the Contractor.
                                </P>
                                <P>(2) Based upon the information provided, if the—</P>
                                <P>(i) Contractor agrees that an asserted restriction is not valid, the Contracting Officer may—</P>
                                <P>(A) Strike or correct the unjustified marking at the Contractor's expense; or</P>
                                <P>(B) Return the computer software to the Contractor for correction at the Contractor's expense. If the Contractor fails to correct or strike the unjustified restrictions and return the corrected software to the Contracting Officer within sixty (60) days following receipt of the software, the Contracting Officer may correct the strike the markings at the Contractor's expense.</P>
                                <P>(ii) Contracting Officer concludes that the asserted restriction is appropriate for this contract, the Contracting Officer shall so notify the Contractor in writing.</P>
                                <P>(3) The Contractor's failure to provide a timely response to a Contracting Officer's request for information or failure to provide sufficient information to enable the Contracting Officer to evaluate an asserted restriction shall constitute reasonable grounds for questioning the validity of an asserted restriction.</P>
                                <P>
                                    (e) 
                                    <E T="03">Government right to challenge and validate asserted restrictions.</E>
                                     (1) The Government, when there are reasonable grounds to do so, has the right to review and challenge the validity of any restrictions asserted by the Contractor on the Government's rights to use, modify, reproduce, release, perform, display, or disclose computer software delivered, to be delivered under this contract, or otherwise provided to the Government in the performance of this contract. Except for software that is publicly available, has been furnished to the Government without restrictions, or has been otherwise made available without restrictions, the Government may exercise this right only within three years after the date(s) the software is delivered or otherwise furnished to the Government, or three years following final payment under this contract, whichever is later.
                                </P>
                                <P>(2) The absence of a challenge to an asserted restriction shall not constitute validation under this clause. Only a Contracting Officer's final decision or actions of an agency Board of Contract Appeals or a court of competent jurisdiction that sustain the validity of an asserted restriction constitute validation of the restriction.</P>
                                <P>
                                    (f) 
                                    <E T="03">Challenge procedures.</E>
                                     (1) A challenge must be in writing and shall—
                                </P>
                                <P>(i) State the specific grounds for challenging the asserted restriction;</P>
                                <P>(ii) Require the Contractor to respond within sixty (60) days;</P>
                                <P>(iii) Require the Contractor to provide justification for the assertion based upon records kept in accordance with paragraph (b) of this clause and such other documentation that are reasonably available to the Contractor, in sufficient detail to enable the Contracting Officer to determine the validity of the asserted restrictions; and</P>
                                <P>(iv) State that a Contracting Officer's final decision, during the three-year period preceding this challenge, or action of a court of competent jurisdiction or Board of Contract Appeals that sustained the validity of an identical assertion made by the Contractor (or a licensee) shall serve as justification for the asserted restriction.</P>
                                <P>(2) The Contracting Officer shall extend the time for response if the Contractor submits a written request showing the need for additional time to prepare a response.</P>
                                <P>(3) The Contracting Officer may request additional supporting documentation if, in the Contracting Officer's opinion, the Contractor's explanation does not provide sufficient evidence to justify the validity of the asserted restrictions. The Contractor agrees to promptly respond to the Contracting Officer's request for additional supporting documentation.</P>
                                <P>(4) Notwithstanding challenge by the Contracting Officer, the parties may agree on the disposition of an asserted restriction at any time prior to a Contracting Officer's final decision or, if the Contractor has appealed that decision, filed suit, or provided notice of an intent to file suit, at any time prior to a decision by a court of competent jurisdiction or Board of Contract Appeals.</P>
                                <P>(5) If the Contractor fails to respond to the Contracting Officer's request for information or additional information under paragraph (f)(1) of this clause, the Contracting Officer shall issue a final decision, in accordance with the Disputes clause of this contract, pertaining to the validity of the asserted restriction.</P>
                                <P>
                                    (6) If the Contracting Officer, after reviewing any available information pertaining to the validity of an asserted restriction, determines that the asserted restriction has—
                                    <PRTPAGE P="656"/>
                                </P>
                                <P>(i) Not been justified, the Contracting Officer shall issue promptly a final decision, in accordance with the Disputes clause of this contract, denying the validity of the asserted restriction; or</P>
                                <P>(ii) Been justified, the Contracting Officer shall issue promptly a final decision, in accordance with the Disputes clause of this contract, validating the asserted restriction.</P>
                                <P>(7) A Contractor receiving challenges to the same asserted restriction(s) from more than one Contracting Officer shall notify each Contracting Officer of the other challenges. The notice shall also state which Contracting Officer initiated the first in time unanswered challenge. The Contracting Officer who initiated the first in time unanswered challenge, after consultation with the other Contracting Officers who have challenged the restrictions and the Contractor, shall formulate and distribute a schedule that provides the contractor a reasonable opportunity for responding to each challenge.</P>
                                <P>
                                    (g) 
                                    <E T="03">Contractor appeal—Government obligation.</E>
                                     (1) The Government agrees that, notwithstanding a Contracting Officer's final decision denying the validity of an asserted restriction and except as provided in paragraph (g)(3) of this clause, it will honor the asserted restriction—
                                </P>
                                <P>(i) For a period of ninety (90) days from the date of the Contracting Officer's final decision to allow the Contractor to appeal to the appropriate Board of Contract Appeals or to file suit in an appropriate court;</P>
                                <P>(ii) For a period of one year from the date of the Contracting Officer's final decision if, within the first ninety (90) days following the Contracting Officer's final decision, the Contractor has provided notice of an intent to file suit in an appropriate court; or</P>
                                <P>(iii) Until final disposition by the appropriate Board of Contract Appeals or court of competent jurisdiction, if the Contractor has: (A) appealed to the Board of Contract Appeals or filed suit an appropriate court within ninety (90) days; or (B) submitted, within ninety (90) days, a notice of intent to file suit in an appropriate court and filed suit within one year.</P>
                                <P>(2) The Contractor agrees that the Government may strike, correct, or ignore the restrictive markings if the Contractor fails to—</P>
                                <P>(i) Appeal to a Board of Contract Appeals within ninety (90) days from the date of the Contracting Officer's final decision;</P>
                                <P>(ii) File suit in an appropriate court within ninety (90) days from such date; or</P>
                                <P>(iii) File suit within one year after the date of the Contracting Officer's final decision if the Contractor had provided notice of intent to file suit within ninety (90) days following the date of the Contracting Officer's final decision.</P>
                                <P>(3) The agency head, on a nondelegable basis, may determine that urgent or compelling circumstances do not permit awaiting the filing of suit in an appropriate court, or the rendering of a decision by a court of competent jurisdiction or Board of Contract Appeals. In that event, the agency head shall notify the Contractor of the urgent or compelling circumstances. Notwithstanding paragraph (g)(1) of this clause, the Contractor agrees that the agency may use, modify, reproduce, release, perform, display, or disclose computer software marked with (i) government purpose legends for any purpose, and authorize others to do so; or (ii) restricted or special license rights for government purposes only. The Government agrees not to release or disclose such software unless, prior to release or disclosure, the intended recipient is subject to the use and non-disclosure agreement at 227.7103-7 of the Defense Federal Acquisition Regulation Supplement (DFARS), or is a Government contractor receiving access to the software for performance of a Government contract that contains the clause at DFARS 252.227-7025, Limitations on the Use or Disclosure of Government-Furnished Information Marked with Restrictive Legends. The agency head's determination may be made at any time after the date of the Contracting Officer's final decision and shall not affect the Contractor's right to damages against the United States, or other relief provided by law, if its asserted restrictions are ultimately upheld.</P>
                                <P>
                                    (h) 
                                    <E T="03">Final disposition of appeal or suit.</E>
                                     If the Contractor appeals or files suit and if, upon final disposition of the appeal or suit, the Contracting Officer's decision is:
                                </P>
                                <P>(1) Sustained—</P>
                                <P>(i) Any restrictive marking on such computer software shall be struck or corrected at the contractor's expense or ignored; and</P>
                                <P>(ii) If the asserted restriction is found not to be substantially justified, the Contractor shall be liable to the Government for payment of the cost to the Government of reviewing the asserted restriction and the fees and other expenses (as defined in 28 U.S.C. 2412(d)(2)(A)) incurred by the Government in challenging the restriction, unless special circumstances would make such payment unjust.</P>
                                <P>(2) Not sustained—</P>
                                <P>(i) The Government shall be bound by the asserted restriction; and</P>
                                <P>(ii) If the challenge by the Government is found not to have been made in good faith, the Government shall be liable to the Contractor for payment of fees and other expenses (as defined in 28 U.S.C. 2412(d)(2)(A)) incurred by the Contractor in defending the restriction.</P>
                                <P>
                                    (i) 
                                    <E T="03">Flowdown.</E>
                                     The Contractor shall insert this clause in all contracts, purchase orders, and other similar instruments with its subcontractors or suppliers, at any tier, who will be furnishing computer software to the 
                                    <PRTPAGE P="657"/>
                                    Government in the performance of this contract. The clause may not be altered other than to identify the appropriate parties.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[60 FR 33503, June 28, 1995, as amended at 76 FR 58148, Sept. 20, 2011; 81 FR 65566, Sept. 23, 2016; 88 FR 6595, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7020</SECTNO>
                            <SUBJECT>Rights in special works.</SUBJECT>
                            <P>As prescribed in 227.7105-3, 227.7106(a) or 227.7205(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Rights in Special Works (JUN 1995)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Applicability.</E>
                                     This clause applies to works first created, generated, or produced and required to be delivered under this contract.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause:
                                </P>
                                <P>(1) “Computer data base” means a collection of data recorded in a form capable of being processed by a computer. The term does not include computer software.</P>
                                <P>(2) “Computer program” means a set of instructions, rules, or routines recorded in a form that is capable of causing a computer to perform a specific operation or series of operations.</P>
                                <P>(3) “Computer software” means computer programs, source code, source code listings, object code listings, design details, algorithms, processes, flow charts, formulae and related material that would enable the software to be reproduced, recreated, or recompiled. Computer software does not include computer data bases or computer software documentation.</P>
                                <P>(4) “Computer software documentation” means owner's manuals, user's manuals, installation instructions, operating instructions, and other similar items, regardless of storage medium, that explain the capabilities of the computer software or provide instructions for using the software.</P>
                                <P>(5) “Unlimited rights” means the rights to use, modify, reproduce, perform, display, release, or disclose a work in whole or in part, in any manner, and for any purpose whatsoever, and to have or authorize others to do so.</P>
                                <P>(6) The term “works” includes computer data bases, computer software, or computer software documentation; literary, musical, choreographic, or dramatic compositions; pantomimes; pictorial, graphic, or sculptural compositions; motion pictures and other audiovisual compositions; sound recordings in any medium; or, items of similar nature.</P>
                                <P>
                                    (c) 
                                    <E T="03">License rights.</E>
                                     (1) The Government shall have unlimited rights in works first produced, created, or generated and required to be delivered under this contract.
                                </P>
                                <P>
                                    (2) When a work is first produced, created, or generated under this contract, and such work is required to be delivered under this contract, the Contractor shall assign copyright in those works to the Government. The Contractor, unless directed to the contrary by the Contracting Officer, shall place the following notice on such works: “
                                    <E T="51">©</E>
                                     (
                                    <E T="03">Year date of delivery</E>
                                    ) United States Government, as represented by the Secretary of (
                                    <E T="03">department</E>
                                    ). All rights reserved.”
                                </P>
                                <P>
                                    For phonorecords, the “
                                    <E T="51">©</E>
                                    ” markings shall be replaced by a “P”.
                                </P>
                                <P>(3) The Contractor grants to the Government a royalty-free, world-wide, nonexclusive, irrevocable license to reproduce, prepare derivative works from, distribute, perform, or display, and to have or authorize others to do so, the Contractor's copyrighted works not first produced, created, or generated under this contract that have been incorporated into the works deliverable under this contract.</P>
                                <P>
                                    (d) 
                                    <E T="03">Third party copyrighted data.</E>
                                     The Contractor shall not incorporate, without the written approval of the Contracting Officer, any copyrighted works in the works to be delivered under this contract unless the Contractor is the copyright owner or has obtained for the Government the license rights necessary to perfect a license of the scope identified in paragraph (c)(3) of this clause and, prior to delivery of such works—
                                </P>
                                <P>(1) Has affixed to the transmittal document a statement of the license rights obtained; or</P>
                                <P>(2) For computer software, has provided a statement of the license rights obtained in a form acceptable to the Contracting Officer.</P>
                                <P>
                                    (e) 
                                    <E T="03">Indemnification.</E>
                                     The Contractor shall indemnify and save and hold harmless the Government, and its officers, agents and employees acting for the Government, against any liability, including costs and expenses, (1) for violation of proprietary rights, copyrights, or rights of privacy or publicity, arising out of the creation, delivery, use, modification, reproduction, release, performance, display, or disclosure of any works furnished under this contract, or (2) based upon any libelous or other unlawful matter contained in such works.
                                </P>
                                <P>
                                    (f) 
                                    <E T="03">Government-furnished information.</E>
                                     Paragraphs (d) and (e) of this clause are not applicable to information furnished to the Contractor by the Government and incorporated in the works delivered under this contract.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[60 FR 33504, June 28, 1995]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7021</SECTNO>
                            <SUBJECT>Rights in data—existing works.</SUBJECT>
                            <P>As prescribed at 227.7105-2(a), use the following clause:</P>
                            <EXTRACT>
                                <PRTPAGE P="658"/>
                                <HD SOURCE="HD1">Rights in Data—Existing Works (MAR 1979)</HD>
                                <P>
                                    (a) The term 
                                    <E T="03">works</E>
                                     as used herein includes literary, musical, and dramatic works; pantomimes and choreographic works; pictorial, graphic and sculptural works; motion pictures and other audiovisual works; sound recordings; and works of a similar nature. The term does not include financial reports, cost analyses, and other information incidental to contract administration.
                                </P>
                                <P>(b) Except as otherwise provided in this contract, the Contractor hereby grants to the Government a nonexclusive, paid-up license throughout the world (1) to distribute, perform publicly, and display publicly the works called for under this contract and (2) to authorize others to do so for Government purposes.</P>
                                <P>(c) The Contractor shall indemnify and save and hold harmless the Government, and its officers, agents, and employees acting for the Government, against any liability, including costs and expenses, (1) for violation of proprietary rights, copyrights, or rights of privacy or publicity arising out of the creation, delivery, or use, of any works furnished under this contract, or (2) based upon any libelous or other unlawful matter contained in same works.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 60 FR 33504, June 28, 1994]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7022</SECTNO>
                            <SUBJECT>Government rights (unlimited).</SUBJECT>
                            <P>As prescribed at 227.7107-1(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Government Rights (Unlimited) (MAR 1979)</HD>
                                <P>The Government shall have unlimited rights, in all drawings, designs, specifications, notes and other works developed in the performance of this contract, including the right to use same on any other Government design or construction without additional compensation to the Contractor. The Contractor hereby grants to the Government a paid-up license throughout the world to all such works to which he may assert or establish any claim under design patent or copyright laws. The Contractor for a period of three (3) years after completion of the project agrees to furnish the original or copies of all such works on the request of the Contracting Officer.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 60 FR 33504, June 28, 1994]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7023</SECTNO>
                            <SUBJECT>Drawings and other data to become property of Government.</SUBJECT>
                            <P>As prescribed at 227.7107-1(b), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Drawings and Other Data to Become Property of Government (MAR 1979)</HD>
                                <P>All designs, drawings, specifications, notes and other works developed in the performance of this contract shall become the sole property of the Government and may be used on any other design or construction without additional compensation to the Contractor. The Government shall be considered the “person for whom the work was prepared” for the purpose of authorship in any copyrightable work under 17 U.S.C. 201(b). With respect thereto, the Contractor agrees not to assert or authorize others to assert any rights nor establish any claim under the design patent or copyright laws. The Contractor for a period of three (3) years after completion of the project agrees to furnish all retained works on the request of the Contracting Officer. Unless otherwise provided in this contract, the Contractor shall have the right to retain copies of all works beyond such period.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 60 FR 33505, June 28, 1995]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7024</SECTNO>
                            <SUBJECT>Notice and approval of restricted designs.</SUBJECT>
                            <P>As prescribed at 227.7107-3, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Notice and Approval of Restricted Designs (APR 1984)</HD>
                                <P>In the performance of this contract, the Contractor shall, to the extent practicable, make maximum use of structures, machines, products, materials, construction methods, and equipment that are readily available through Government or competitive commercial channels, or through standard or proven production techniques, methods, and processes. Unless approved by the Contracting Officer, the Contractor shall not produce a design or specification that requires in this construction work the use of structures, products, materials, construction equipment, or processes that are known by the Contractor to be available only from a sole source. The Contractor shall promptly report any such design or specification to the Contracting Officer and give the reason why it is considered necessary to so restrict the design or specification.</P>
                            </EXTRACT>
                            <PRTPAGE P="659"/>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 60 FR 33505, June 28, 1995]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7025</SECTNO>
                            <SUBJECT>Limitations on the Use or Disclosure of Government-Furnished Information Marked with Restrictive Legends.</SUBJECT>
                            <P>As prescribed in 227.7103-6(c), 227.7104(f)(1), or 227.7203-6(d), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Limitations on the Use or Disclosure of Government-Furnished Information Marked With Restrictive Legends (JAN 2023)</HD>
                                <P>(a)(1) For contracts in which the Government will furnish the Contractor with technical data, the terms “covered Government support contractor,” “limited rights,” and “Government purpose rights” are defined in the clause at 252.227-7013, Rights in Technical Data—Other Than Commercial Products and Commercial Services.</P>
                                <P>(2) For contracts in which the Government will furnish the Contractor with computer software or computer software documentation, the terms “covered Government support contractor,” “government purpose rights,” and “restricted rights” are defined in the clause at 252.227-7014, Rights in Other Than Commercial Computer Software and Other Than Commercial Computer Software Documentation.</P>
                                <P>(3) For Small Business Innovation Research program contracts, the terms “covered Government support contractor,” “limited rights,” “restricted rights,” and “SBIR data rights” are defined in the clause at 252.227-7018, Rights in Other Than Commercial Technical Data and Computer Software—Small Business Innovation Research (SBIR) Program.</P>
                                <P>(b) Technical data or computer software provided to the Contractor as Government-furnished information (GFI) under this contract may be subject to restrictions on use, modification, reproduction, release, performance, display, or further disclosure.</P>
                                <P>
                                    (1) 
                                    <E T="03">GFI marked with limited rights, restricted rights, or SBIR data rights legends.</E>
                                     (i) The Contractor shall use, modify, reproduce, perform, or display technical data received from the Government with limited rights legends, computer software received with restricted rights legends, or SBIR technical data or computer software received with SBIR data rights legends (during the SBIR data protection period) only in the performance of this contract. The Contractor shall not, without the express written permission of the party whose name appears in the legend, release or disclose such data or software to any unauthorized person.
                                </P>
                                <P>(ii) If the Contractor is a covered Government support contractor, the Contractor is also subject to the additional terms and conditions at paragraph (b)(5) of this clause.</P>
                                <P>
                                    (2) 
                                    <E T="03">GFI marked with government purpose rights legends.</E>
                                     The Contractor shall use technical data or computer software received from the Government with government purpose rights legends for government purposes only. The Contractor shall not, without the express written permission of the party whose name appears in the restrictive legend, use, modify, reproduce, release, perform, or display such data or software for any commercial purpose or disclose such data or software to a person other than its subcontractors, suppliers, or prospective subcontractors or suppliers, who require the data or software to submit offers for, or perform, contracts under this contract. Prior to disclosing the data or software, the Contractor shall require the persons to whom disclosure will be made to complete and sign the non-disclosure agreement at 227.7103-7.
                                </P>
                                <P>
                                    (3) 
                                    <E T="03">GFI marked with specially negotiated license rights legends.</E>
                                     (i) The Contractor shall use, modify, reproduce, release, perform, or display technical data or computer software received from the Government with specially negotiated license legends only as permitted in the license. Such data or software may not be released or disclosed to other persons unless permitted by the license and, prior to release or disclosure, the intended recipient has completed the non-disclosure agreement at 227.7103-7. The Contractor shall modify paragraph (1)(c) of the non-disclosure agreement to reflect the recipient's obligations regarding use, modification, reproduction, release, performance, display, and disclosure of the data or software.
                                </P>
                                <P>(ii) If the Contractor is a covered Government support contractor, the Contractor may also be subject to some or all of the additional terms and conditions at paragraph (b)(5) of this clause, to the extent such terms and conditions are required by the specially negotiated license.</P>
                                <P>
                                    (4) 
                                    <E T="03">GFI technical data marked with commercial restrictive legends.</E>
                                     (i) The Contractor shall use, modify, reproduce, perform, or display technical data that is or pertains to a commercial product or commercial service  and is received from the Government with a commercial restrictive legend (i.e., marked to indicate that such data are subject to use, modification, reproduction, release, performance, display, or disclosure restrictions) only in the performance of this contract. The Contractor shall not, without the express written permission of the party whose name appears in the legend, use the technical data to manufacture additional quantities of the commercial products or commercial services, or release or disclose such data to any unauthorized person.
                                    <PRTPAGE P="660"/>
                                </P>
                                <P>(ii) If the Contractor is a covered Government support contractor, the Contractor is also subject to the additional terms and conditions at paragraph (b)(5) of this clause</P>
                                <P>
                                    (5) 
                                    <E T="03">Covered Government support contractors.</E>
                                     If the Contractor is a covered Government support contractor receiving technical data or computer software marked with restrictive legends pursuant to paragraphs (b)(1)(ii), (b)(3)(ii), or (b)(4)(ii) of this clause, the Contractor further agrees and acknowledges that—
                                </P>
                                <P>(i) The technical data or computer software will be accessed and used for the sole purpose of furnishing independent and impartial advice or technical assistance directly to the Government in support of the Government's management and oversight of the program or effort to which such technical data or computer software relates, as stated in this contract, and shall not be used to compete for any Government or non-Government contract;</P>
                                <P>(ii) The Contractor will take all reasonable steps to protect the technical data or computer software against any unauthorized release or disclosure;</P>
                                <P>(iii) The Contractor will ensure that the party whose name appears in the legend is notified of the access or use within thirty (30) days of the Contractor's access or use of such data or software;</P>
                                <P>(iv) The Contractor will enter into a non-disclosure agreement with the party whose name appears in the legend, if required to do so by that party, and that any such non-disclosure agreement will implement the restrictions on the Contractor's use of such data or software as set forth in this clause. The non-disclosure agreement shall not include any additional terms and conditions unless mutually agreed to by the parties to the non-disclosure agreement; and</P>
                                <P>(v) That a breach of these obligations or restrictions may subject the Contractor to—</P>
                                <P>(A) Criminal, civil, administrative, and contractual actions in law and equity for penalties, damages, and other appropriate remedies by the United States; and</P>
                                <P>(B) Civil actions for damages and other appropriate remedies by the party whose name appears in the legend.</P>
                                <P>
                                    (c) 
                                    <E T="03">Indemnification and creation of third party beneficiary rights.</E>
                                     The Contractor agrees—
                                </P>
                                <P>(1) To indemnify and hold harmless the Government, its agents, and employees from every claim or liability, including attorneys fees, court costs, and expenses, arising out of, or in any way related to, the misuse or unauthorized modification, reproduction, release, performance, display, or disclosure of technical data or computer software received from the Government with restrictive legends by the Contractor or any person to whom the Contractor has released or disclosed such data or software; and</P>
                                <P>(2) That the party whose name appears on the restrictive legend, in addition to any other rights it may have, is a third party beneficiary who has the right of direct action against the Contractor, or any person to whom the Contractor has released or disclosed such data or software, for the unauthorized duplication, release, or disclosure of technical data or computer software subject to restrictive legends.</P>
                                <P>(d) The Contractor shall ensure that its employees are subject to use and non-disclosure obligations consistent with this clause prior to the employees being provided access to or use of any GFI covered by this clause.</P>
                            </EXTRACT>
                            <CITA>[78 FR 30241, May 22, 2013, as amended at 88 FR 6595, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7026</SECTNO>
                            <SUBJECT>Deferred delivery of technical data or computer software.</SUBJECT>
                            <P>As prescribed at 227.7103-8(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Deferred Delivery of Technical Data or Computer Software (APR 1988)</HD>
                                <P>The Government shall have the right to require, at any time during the performance of this contract, within two (2) years after either acceptance of all items (other than data or computer software) to be delivered under this contract or termination of this contract, whichever is later, delivery of any technical data or computer software item identified in this contract as “deferred delivery” data or computer software. The obligation to furnish such technical data required to be prepared by a subcontractor and pertaining to an item obtained from him shall expire two (2) years after the date Contractor accepts the last delivery of that item from that subcontractor for use in performing this contract.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 60 FR 33505, June 28, 1995]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7027</SECTNO>
                            <SUBJECT>Deferred ordering of technical data or computer software.</SUBJECT>
                            <P>As prescribed at 227.7103-8(b), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Deferred Ordering of Technical Data or Computer Software (APR 1988)</HD>
                                <P>
                                    In addition to technical data or computer software specified elsewhere in this contract to be delivered hereunder, the Government may, at any time during the performance of this contract or within a period of three (3) years after acceptance of all items (other than technical data or computer software) to 
                                    <PRTPAGE P="661"/>
                                    be delivered under this contract or the termination of this contract, order any technical data or computer software generated in the performance of this contract or any subcontract hereunder. When the technical data or computer software is ordered, the Contractor shall be compensated for converting the data or computer software into the prescribed form, for reproduction and delivery. The obligation to deliver the technical data of a subcontractor and pertaining to an item obtained from him shall expire three (3) years after the date the Contractor accepts the last delivery of that item from that subcontractor under this contract. The Government's rights to use said data or computer software shall be pursuant to the “Rights in Technical Data and Computer Software” clause of this contract.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 60 FR 33505, June 28, 1995]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7028</SECTNO>
                            <SUBJECT>Technical data or computer software previously delivered to the government.</SUBJECT>
                            <P>As prescribed in 227.7103-6(d), 227.7104(f)(2), or 227.7203-6(e), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Technical Data or Computer Software Previously Delivered to the Government (JUN 1995)</HD>
                                <P>The Offeror shall attach to its offer an identification of all documents or other media incorporating technical data or computer software it intends to deliver under this contract with other than unlimited rights that are identical or substantially similar to documents or other media that the Offeror has produced for, delivered to, or is obligated to deliver to the Government under any contract or subcontract. The attachment shall identify—</P>
                                <P>(a) The contract number under which the data or software were produced;</P>
                                <P>(b) The contract number under which, and the name and address of the organization to whom, the data or software were most recently delivered or will be delivered; and</P>
                                <P>(c) Any limitations on the Government's rights to use or disclose the data or software, including, when applicable, identification of the earliest date the limitations expire.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[60 FR 33505, June 28, 1995]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7029</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7030</SECTNO>
                            <SUBJECT>Technical data—withholding of payment.</SUBJECT>
                            <P>As prescribed at 227.7103-6(e)(2) or 227.7104(e)(4), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Technical Data—Withholding of Payment (MAR 2000)</HD>
                                <P>(a) If technical data specified to be delivered under this contract, is not delivered within the time specified by this contract or is deficient upon delivery (including having restrictive markings not identified in the list described in the clause at 252.227-7013(e)(2) or 252.227-7018(e)(2) of this contract), the Contracting Officer may until such data is accepted by the Government, withhold payment to the Contractor of ten percent (10%) of the total contract price or amount unless a lesser withholding is specified in the contract. Payments shall not be withheld nor any other action taken pursuant to this paragraph when the Contractor's failure to make timely delivery or to deliver such data without deficiencies arises out of causes beyond the control and without the fault or negligence of the Contractor.</P>
                                <P>(b) The withholding of any amount or subsequent payment to the Contractor shall not be construed as a waiver of any rights accruing to the Government under this contract.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 60 FR 33505, June 28, 1995; 62 FR 34132, June 24, 1997; 65 FR 14398, Mar. 16, 2000]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7031</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7032</SECTNO>
                            <SUBJECT>Rights in technical data and computer software (foreign).</SUBJECT>
                            <P>As prescribed in 227.7103-17, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Rights in Technical Data and Computer Software (Foreign) (JUN 1975)</HD>
                                <P>The United States Government may duplicate, use, and disclose in any manner for any purposes whatsoever, including delivery to other governments for the furtherance of mutual defense of the United States Government and other governments, all technical data including reports, drawings and blueprints, and all computer software, specified to be delivered by the Contractor to the United States Government under this contract.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 60 FR 33505, June 28, 1995]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="662"/>
                            <SECTNO>252.227-7033</SECTNO>
                            <SUBJECT>Rights in shop drawings.</SUBJECT>
                            <P>As prescribed in 227.7107-(1)(c), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Rights in Shop Drawings (APR 1966)</HD>
                                <P>(a) Shop drawings for construction means drawings, submitted to the Government by the Construction Contractor, subcontractor or any lower-tier subcontractor pursuant to a construction contract, showing in detail (i) the proposed fabrication and assembly of structural elements and (ii) the installation (i.e., form, fit, and attachment details) of materials or equipment. The Government may duplicate, use, and disclose in any manner and for any purpose shop drawings delivered under this contract.</P>
                                <P>(b) This clause, including this paragraph (b), shall be included in all subcontracts hereunder at any tier.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 60 FR 33505, June 28, 1995]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7034—252.227-7036</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7037</SECTNO>
                            <SUBJECT>Validation of Restrictive Markings on Technical Data.</SUBJECT>
                            <P>As prescribed in 227.7102-4(c), 227.7103-6(e)(3),227.7104(e)(5), or 227.7203-6(f), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Validation of Restrictive Markings on Technical Data (JAN 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     The terms used in this clause are defined in the Rights in Technical Data—Other Than Commercial Products and Commercial Services  clause of this contract.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Commercial products or commercial services—presumption regarding development exclusively at private expense..</E>
                                     The Contracting Officer will presume that the Contractor's or a subcontractor's asserted use or release restrictions with respect to a commercial product or commercial service  are justified on the basis that the item was developed exclusively at private expense. The Contracting Officer will not issue a challenge unless there are reasonable grounds to question the validity of the assertion that the commercial item was developed exclusively at private expense.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Justification.</E>
                                     The Contractor or subcontractor at any tier is responsible for maintaining records sufficient to justify the validity of its markings that impose restrictions on the Government and others to use, duplicate, or disclose technical data delivered or required to be delivered under the contract or subcontract. Except as provided in paragraph (b) of this clause, the Contractor or subcontractor shall be prepared to furnish to the Contracting Officer a written justification for such restrictive markings in response to a challenge under paragraph (e) of this clause.
                                </P>
                                <P>
                                    (d) 
                                    <E T="03">Prechallenge request for information.</E>
                                     (1) The Contracting Officer may request the Contractor or subcontractor to furnish a written explanation for any restriction asserted by the Contractor or subcontractor on the right of the United States or others to use technical data. If, upon review of the explanation submitted, the Contracting Officer remains unable to ascertain the basis of the restrictive marking, the Contracting Officer may further request the Contractor or subcontractor to furnish additional information in the records of, or otherwise in the possession of or reasonably available to, the Contractor or subcontractor to justify the validity of any restrictive marking on technical data delivered or to be delivered under the contract or subcontract (e.g., a statement of facts accompanied with supporting documentation). The Contractor or subcontractor shall submit such written data as requested by the Contracting Officer within the time required or such longer period as may be mutually agreed.
                                </P>
                                <P>(2) If the Contracting Officer, after reviewing the written data furnished pursuant to paragraph (d)(1) of this clause, or any other available information pertaining to the validity of a restrictive marking, determines that reasonable grounds exist to question the current validity of the marking and that continued adherence to the marking would make impracticable the subsequent competitive acquisition of the item, component, or process to which the technical data relates, the Contracting Officer will follow the procedures in paragraph (e) of this clause.</P>
                                <P>(3) If the Contractor or subcontractor fails to respond to the Contracting Officer's request for information under paragraph (d)(1) of this clause, and the Contracting Officer determines that continued adherence to the marking would make impracticable the subsequent competitive acquisition of the item, component, or process to which the technical data relates, the Contracting Officer may challenge the validity of the marking as described in paragraph (e) of this clause.</P>
                                <P>
                                    (e) 
                                    <E T="03">Challenge.</E>
                                     (1) Notwithstanding any provision of this contract concerning inspection and acceptance, if the Contracting Officer determines that a challenge to the restrictive marking is warranted, the Contracting Officer will send a written challenge notice to the Contractor or subcontractor asserting the restrictive markings. The challenge notice and all related correspondence shall be subject to handling procedures for classified information and controlled unclassified information. Such challenge will—
                                </P>
                                <P>
                                    (i) State the specific grounds for challenging the asserted restriction including, 
                                    <PRTPAGE P="663"/>
                                    for commercial products or commercial services, sufficient information to reasonably demonstrate that the commercial product or commercial service was not developed exclusively at private expense;
                                </P>
                                <P>(ii) Require a response within 60 days justifying and providing sufficient evidence as to the current validity of the asserted restriction;</P>
                                <P>(iii) State that a DoD Contracting Officer's final decision, issued pursuant to paragraph (g) of this clause, sustaining the validity of a restrictive marking identical to the asserted restriction, within the three-year period preceding the challenge, shall serve as justification for the asserted restriction if the validated restriction was asserted by the same Contractor or subcontractor (or any licensee of such Contractor or subcontractor) to which such notice is being provided; and</P>
                                <P>(iv) State that failure to respond to the challenge notice may result in issuance of a final decision pursuant to paragraph (f) of this clause.</P>
                                <P>(2) The Contracting Officer will extend the time for response as appropriate if the Contractor or subcontractor submits a written request showing the need for additional time to prepare a response.</P>
                                <P>(3) The Contractor's or subcontractor's written response shall be considered a claim within the meaning of the 41 U.S.C. 7101, Contract Disputes, and shall be certified in the form prescribed at 33.207 of the Federal Acquisition Regulation, regardless of dollar amount.</P>
                                <P>(4) A Contractor or subcontractor receiving challenges to the same restrictive markings from more than one Contracting Officer shall notify each Contracting Officer of the existence of more than one challenge. The notice shall also state which Contracting Officer initiated the first in time unanswered challenge. The Contracting Officer initiating the first in time unanswered challenge after consultation with the Contractor or subcontractor and the other Contracting Officers, will formulate and distribute a schedule for responding to each of the challenge notices to all interested parties. The schedule will afford the Contractor or subcontractor an opportunity to respond to each challenge notice. All parties will be bound by this schedule.</P>
                                <P>
                                    (f) 
                                    <E T="03">Final decision when Contractor or subcontractor fails to respond.</E>
                                     Upon a failure of a Contractor or subcontractor to submit any response to the challenge notice the Contracting Officer will issue a final decision to the Contractor or subcontractor in accordance with the Disputes clause of this contract. In order to sustain the challenge for  commercial products or commercial services, the Contracting Officer will provide information demonstrating that the commercial product or commercial service was not developed exclusively at private expense. This final decision will be issued as soon as possible after the expiration of the time period of paragraph (e)(1)(ii) or (e)(2) of this clause. Following issuance of the final decision, the Contracting Officer will comply with the procedures in paragraphs (g)(2)(ii) through (iv) of this clause.
                                </P>
                                <P>
                                    (g) 
                                    <E T="03">Final decision when Contractor or subcontractor responds.</E>
                                     (1) if the Contracting Officer determines that the Contractor or subcontractor has justified the validity of the restrictive marking, the Contracting Officer will issue a final decision to the Contractor or subcontractor sustaining the validity of the restrictive marking, and stating that the Government will continue to be bound by the restrictive marking. This final decision will be issued within 60 days after receipt of the Contractor's or subcontractor's response to the challenge notice, or within such longer period that the Contracting Officer has notified the Contractor or subcontractor that the Government will require. The notification of a longer period for issuance of a final decision will be made within 60 days after receipt of the response to the challenge notice.
                                </P>
                                <P>(2)(i) If the Contracting Officer determines that the validity of the restrictive marking is not justified, the Contracting Officer will issue a final decision to the Contractor or subcontractor in accordance with the Disputes clause of this contract. In order to sustain the challenge for  commercial products or commercial services, the Contracting Officer will provide information demonstrating that the  commercial product or commercial service was not developed exclusively at private expense. Notwithstanding paragraph (e) of the Disputes clause, the final decision will be issued within 60 days after receipt of the Contractor's or subcontractor's response to the challenge notice, or within such longer period that the Contracting Officer has notified the Contractor or subcontractor that the Government will require. The notification of a longer period for issuance of a final decision will be made within 60 days after receipt of the response to the challenge notice.</P>
                                <P>
                                    (ii) The Government agrees that it will continue to be bound by the restrictive marking of a period of 90 days from the issuance of the Contracting Officer's final decision under paragraph (g)(2)(i) of this clause. The Contractor or subcontractor agrees that, if it intends to file suit in the United States Claims Court it will provide a notice of intent to file suit to the Contracting Officer within 90 days from the issuance of the Contracting Officer's final decision under paragraph (g)(2)(i) of this clause. If the Contractor or subcontractor fails to appeal, file suit, or provide a notice of intent to file suit to the Contracting Officer within the 90-day period, the Government may cancel or ignore the restrictive markings, and the failure of the Contractor or subcontractor to take the required action 
                                    <PRTPAGE P="664"/>
                                    constitutes agreement with such Government action.
                                </P>
                                <P>(iii) The Government agrees that it will continue to be bound by the restrictive marking where a notice of intent to file suit in the United States Claims Court is provided to the Contracting Officer within 90 days from the issuance of the final decision under paragraph (g)(2)(i) of this clause. The Government will no longer be bound, and the Contractor or subcontractor agrees that the Government may strike or ignore the restrictive markings, if the Contractor or subcontractor fails to file its suit within one 1 year after issuance of the final decision. Notwithstanding the foregoing, where the head of an agency determines, on a nondelegable basis, that urgent or compelling circumstances will not permit waiting for the filing of a suit in the United States Claims Court, the Contractor or subcontractor agrees that the agency may, following notice to the Contractor or subcontractor, authorize release or disclosure of the technical data. Such agency determination may be made at any time after issuance of the final decision and will not affect the Contractor's or subcontractor's right to damages against the United States where its restrictive markings are ultimately upheld or to pursue other relief, if any, as may be provided by law.</P>
                                <P>(iv) The Government agrees that it will be bound by the restrictive marking where an appeal or suit is filed pursuant to the Contract Disputes statute until final disposition by an agency Board of Contract Appeals or the United States Claims Court. Notwithstanding the foregoing, where the head of an agency determines, on a nondelegable basis, following notice to the Contractor that urgent or compelling circumstances will not permit awaiting the decision by such Board of Contract Appeals or the United States Claims Court, the Contractor or subcontractor agrees that the agency may authorize release or disclosure of the technical data. Such agency determination may be made at any time after issuance of the final decision and will not affect the Contractor's or subcontractor's right to damages against the United States where its restrictive markings are ultimately upheld or to pursue other relief, if any, as may be provided by law.</P>
                                <P>
                                    (h) 
                                    <E T="03">Final disposition of appeal or suit.</E>
                                     (1) If the Contractor or subcontractor appeals or files suit and if, upon final disposition of the appeal or suit, the Contracting Officer's decision is sustained—
                                </P>
                                <P>(i) The restrictive marking on the technical data shall be cancelled, corrected or ignored; and</P>
                                <P>(ii) If the restrictive marking is found not to be substantially justified, the Contractor or subcontractor, as appropriate, shall be liable to the Government for payment of the cost to the Government of reviewing the restrictive marking and the fees and other expenses (as defined in 28 U.S.C. 2412(d)(2)(A)) incurred by the Government in challenging the marking, unless special circumstances would make such payment unjust.</P>
                                <P>(2) If the Contractor or subcontractor appeals or files suit and if, upon final disposition of the appeal or suit, the Contracting Officer's decision is not sustained—</P>
                                <P>(i) The Government will continue to be bound by the restrictive marking; and</P>
                                <P>(ii) The Government will be liable to the Contractor or subcontractor for payment of fees and other expenses (as defined in 28 U.S.C. 2412(d)(2)(A)) incurred by the Contractor or subcontractor in defending the marking, if the challenge by the Government is found not to have been made in good faith.</P>
                                <P>
                                    (i) 
                                    <E T="03">Duration of right to challenge.</E>
                                     The Government may review the validity of any restriction on technical data, delivered or to be delivered under a contract, asserted by the Contractor or subcontractor. During the period within 3 years of final payment on a contract or within 3 years of delivery of the technical data to the Government, whichever is later, the Contracting Officer may review and make a written determination to challenge the restriction. The Government may, however, challenge a restriction on the release, disclosure, or use of technical data at any time if such technical data—
                                </P>
                                <P>(1) Is publicly available;</P>
                                <P>(2) Has been furnished to the United States without restriction; or</P>
                                <P>(3) Has been otherwise made available without restriction. Only the Contracting Officer's final decision resolving a formal challenge by sustaining the validity of a restrictive marking constitutes “validation” as addressed in 10 U.S.C. 3785(c).</P>
                                <P>
                                    (j) 
                                    <E T="03">Decision not to challenge.</E>
                                     A decision by the Government, or a determination by the Contracting Officer, to not challenge the restrictive marking or asserted restriction shall not constitute “validation.”
                                </P>
                                <P>
                                    (k) 
                                    <E T="03">Privity of contract.</E>
                                     The Contractor or subcontractor agrees that the Contracting Officer may transact matters under this clause directly with subcontractors at any tier that assert restrictive markings. However, this clause neither creates nor implies privity of contract between the Government and subcontractors.
                                </P>
                                <P>
                                    (l) 
                                    <E T="03">Flowdown.</E>
                                     The Contractor or subcontractor agrees to insert this clause in contractual instruments, including subcontracts and other contractual instruments for commercial products or commercial services, with its subcontractors or suppliers at any tier requiring the delivery of technical data.
                                </P>
                            </EXTRACT>
                            <PRTPAGE P="665"/>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[60 FR 33505, June 28, 1995, as amended at 60 FR 61602, Nov. 30, 1995; 64 FR 51077, Sept. 21, 1999; 69 FR 31912, June 8, 2004; 76 FR 58138, 58149, Sept. 20, 2011; 77 FR 23632, Apr. 20, 2012; 77 FR 76938, Dec. 31, 2012; 78 FR 37990, June 25, 2013; 81 FR 65567, Sept. 23, 2016; 87 FR 25151, Apr. 28, 2022; 87 FR 76998, Dec. 16, 2022; 88 FR 6595, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7038</SECTNO>
                            <SUBJECT>Patent Rights—Ownership by the Contractor (Large Business).</SUBJECT>
                            <P>As prescribed in 227.303(2), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Patent Rights—Ownership by the Contractor (Large Business) (JUN 2012)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                    <E T="03">Invention</E>
                                     means—
                                </P>
                                <P>(1) Any invention or discovery that is or may be patentable or otherwise protectable under Title 35 of the United States Code; or</P>
                                <P>
                                    (2) Any variety of plant that is or may be protectable under the Plant Variety Protection Act (7 U.S.C. 2321, 
                                    <E T="03">et seq.</E>
                                    ).
                                </P>
                                <P>
                                    <E T="03">Made</E>
                                    —
                                </P>
                                <P>(1) When used in relation to any invention other than a plant variety, means the conception or first actual reduction to practice of the invention; or</P>
                                <P>(2) When used in relation to a plant variety, means that the Contractor has at least tentatively determined that the variety has been reproduced with recognized characteristics.</P>
                                <P>
                                    <E T="03">Nonprofit organization</E>
                                     means—
                                </P>
                                <P>(1) A university or other institution of higher education;</P>
                                <P>(2) An organization of the type described in the Internal Revenue Code at 26 U.S.C. 501(c)(3) and exempt from taxation under 26 U.S.C. 501(a); or</P>
                                <P>(3) Any nonprofit scientific or educational organization qualified under a State nonprofit organization statute.</P>
                                <P>
                                    <E T="03">Practical application</E>
                                     means—
                                </P>
                                <P>(1)(i) To manufacture, in the case of a composition or product;</P>
                                <P>(ii) To practice, in the case of a process or method; or</P>
                                <P>(iii) To operate, in the case of a machine or system; and</P>
                                <P>(2) In each case, under such conditions as to establish that—</P>
                                <P>(i) The invention is being utilized; and</P>
                                <P>(ii) The benefits of the invention are, to the extent permitted by law or Government regulations, available to the public on reasonable terms.</P>
                                <P>
                                    <E T="03">Subject invention</E>
                                     means any invention of the Contractor made in the performance of work under this contract.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Contractor's rights</E>
                                    —(1) 
                                    <E T="03">Ownership.</E>
                                     The Contractor may elect to retain ownership of each subject invention throughout the world in accordance with the provisions of this clause.
                                </P>
                                <P>
                                    (2) 
                                    <E T="03">License.</E>
                                     (i) The Contractor shall retain a nonexclusive royalty-free license throughout the world in each subject invention to which the Government obtains title, unless the Contractor fails to disclose the invention within the times specified in paragraph (c) of this clause. The Contractor's license-
                                </P>
                                <P>(A) Extends to any domestic subsidiaries and affiliates within the corporate structure of which the Contractor is a part;</P>
                                <P>(B) Includes the right to grant sublicenses to the extent the Contractor was legally obligated to do so at the time of contract award; and</P>
                                <P>(C) Is transferable only with the approval of the agency, except when transferred to the successor of that part of the Contractor's business to which the invention pertains.</P>
                                <P>(ii) The agency—</P>
                                <P>(A) May revoke or modify the Contractor's domestic license to the extent necessary to achieve expeditious practical application of the subject invention pursuant to an application for an exclusive license submitted in accordance with 37 CFR Part 404 and agency licensing regulations;</P>
                                <P>(B) Will not revoke the license in that field of use or the geographical areas in which the Contractor has achieved practical application and continues to make the benefits of the invention reasonably accessible to the public; and</P>
                                <P>(C) May revoke or modify the license in any foreign country to the extent the Contractor, its licensees, or the domestic subsidiaries or affiliates have failed to achieve practical application in that foreign country.</P>
                                <P>(iii) Before revoking or modifying the license, the agency—</P>
                                <P>(A) Will furnish the Contractor a written notice of its intention to revoke or modify the license; and</P>
                                <P>(B) Will allow the Contractor 30 days (or such other time as the funding agency may authorize for good cause shown by the Contractor) after the notice to show cause why the license should not be revoked or modified.</P>
                                <P>(iv) The Contractor has the right to appeal, in accordance with 37 CFR part 404 and agency regulations, concerning the licensing of Government-owned inventions, any decision concerning the revocation or modification of the license.</P>
                                <P>
                                    (c) 
                                    <E T="03">Contractor's obligations.</E>
                                     (1) The Contractor shall—
                                </P>
                                <P>
                                    (i) Disclose, in writing, each subject invention to the Contracting Officer within 2 months after the inventor discloses it in writing to Contractor personnel responsible for patent matters, or within 6 months after the Contractor first becomes aware that a 
                                    <PRTPAGE P="666"/>
                                    subject invention has been made, whichever is earlier;
                                </P>
                                <P>(ii) Include in the disclosure—</P>
                                <P>(A) The inventor(s) and the contract under which the invention was made;</P>
                                <P>(B) Sufficient technical detail to convey a clear understanding of the invention; and</P>
                                <P>(C) Any publication, on sale (i.e., sale or offer for sale), or public use of the invention and whether a manuscript describing the invention has been submitted for publication and, if so, whether it has been accepted for publication; and</P>
                                <P>(iii) After submission of the disclosure, promptly notify the Contracting Officer of the acceptance of any manuscript describing the invention for publication and of any on sale or public use.</P>
                                <P>(2) The Contractor shall elect in writing whether or not to retain ownership of any subject invention by notifying the Contracting Officer at the time of disclosure or within 8 months of disclosure, as to those countries (including the United States) in which the Contractor will retain ownership. However, in any case where publication, on sale, or public use has initiated the 1-year statutory period during which valid patent protection can be obtained in the United States, the agency may shorten the period of election of title to a date that is no more than 60 days prior to the end of the statutory period.</P>
                                <P>(3) The Contractor shall—</P>
                                <P>(i) File either a provisional or a nonprovisional patent application on an elected subject invention within 1 year after election, provided that in all cases the application is filed prior to the end of any statutory period wherein valid patent protection can be obtained in the United States after a publication, on sale, or public use;</P>
                                <P>(ii) File a nonprovisional application within 10 months of the filing of any provisional application; and</P>
                                <P>(iii) File patent applications in additional countries or international patent offices within either 10 months of the first filed patent application (whether provisional or nonprovisional) or 6 months from the date the Commissioner of Patents grants permission to file foreign patent applications where such filing has been prohibited by a Secrecy Order.</P>
                                <P>(4) The Contractor may request extensions of time for disclosure, election, or filing under paragraphs (c)(1), (2), and (3) of this clause. The Contracting Officer will normally grant the extension unless there is reason to believe the extension would prejudice the Government's interests.</P>
                                <P>
                                    (d) 
                                    <E T="03">Government's rights</E>
                                    —(1) 
                                    <E T="03">Ownership.</E>
                                     The Contractor shall assign to the agency, upon written request, title to any subject invention—
                                </P>
                                <P>(i) If the Contractor elects not to retain title to a subject invention;</P>
                                <P>(ii) If the Contractor fails to disclose or elect the subject invention within the times specified in paragraph (c) of this clause and the agency requests title within 60 days after learning of the Contractor's failure to report or elect within the specified times;</P>
                                <P>(iii) In those countries in which the Contractor fails to file patent applications within the times specified in paragraph (c) of this clause, provided that, if the Contractor has filed a patent application in a country after the times specified in paragraph (c) of this clause, but prior to its receipt of the written request of the agency, the Contractor shall continue to retain ownership in that country; and</P>
                                <P>(iv) In any country in which the Contractor decides not to continue the prosecution of any application for, to pay the maintenance fees on, or defend in reexamination or opposition proceeding on, a patent on a subject invention.</P>
                                <P>
                                    (2) 
                                    <E T="03">License.</E>
                                     If the Contractor retains ownership of any subject invention, the Government shall have a nonexclusive, nontransferable, irrevocable, paid-up license to practice, or have practiced for or on behalf of the United States, the subject invention throughout the world.
                                </P>
                                <P>
                                    (e) 
                                    <E T="03">Contractor action to protect the Government's interest.</E>
                                     (1) The Contractor shall execute or have executed and promptly deliver to the agency all instruments necessary to—
                                </P>
                                <P>(i) Establish or confirm the rights the Government has throughout the world in those subject inventions in which the Contractor elects to retain ownership; and</P>
                                <P>(ii) Assign title to the agency when requested under paragraph (d)(1) of this clause and enable the Government to obtain patent protection for that subject invention in any country.</P>
                                <P>(2) The Contractor shall—</P>
                                <P>(i) Require, by written agreement, its employees, other than clerical and nontechnical employees, to—</P>
                                <P>(A) Disclose each subject invention promptly in writing to personnel identified as responsible for the administration of patent matters, so that the Contractor can comply with the disclosure provisions in paragraph (c) of this clause; and</P>
                                <P>(B) Provide the disclosure in the Contractor's format, which should require, as a minimum, the information required by paragraph (c)(1) of this clause;</P>
                                <P>(ii) Instruct its employees, through employee agreements or other suitable educational programs, as to the importance of reporting inventions in sufficient time to permit the filing of patent applications prior to U.S. or statutory foreign bars; and</P>
                                <P>
                                    (iii) Execute all papers necessary to file patent applications on subject inventions and to establish the Government's rights in the subject inventions.
                                    <PRTPAGE P="667"/>
                                </P>
                                <P>(3) The Contractor shall notify the Contracting Officer of any decisions not to file a nonprovisional patent application, continue the prosecution of a patent application, pay maintenance fees, or defend in a reexamination or opposition proceeding on a patent, in any country, not less than 30 days before the expiration of the response or filing period required by the relevant patent office.</P>
                                <P>(4) The Contractor shall include, within the specification of any United States nonprovisional patent application and any patent issuing thereon covering a subject invention, the following statement: “This invention was made with Government support under (identify the contract) awarded by (identify the agency). The Government has certain rights in this invention.”</P>
                                <P>(5) The Contractor shall—</P>
                                <P>(i) Establish and maintain active and effective procedures to ensure that subject inventions are promptly identified and disclosed to Contractor personnel responsible for patent matters;</P>
                                <P>(ii) Include in these procedures the maintenance of—</P>
                                <P>(A) Laboratory notebooks or equivalent records and other records as are reasonably necessary to document the conception and/or the first actual reduction to practice of subject inventions; and</P>
                                <P>(B) Records that show that the procedures for identifying and disclosing the inventions are followed; and</P>
                                <P>(iii) Upon request, furnish the Contracting Officer a description of these procedures for evaluation and for determination as to their effectiveness.</P>
                                <P>(6) The Contractor shall, when licensing a subject invention, arrange to—</P>
                                <P>(i) Avoid royalty charges on acquisitions involving Government funds, including funds derived through the Government's Military Assistance Program or otherwise derived through the Government;</P>
                                <P>(ii) Refund any amounts received as royalty charges on the subject inventions in acquisitions for, or on behalf of, the Government; and</P>
                                <P>(iii) Provide for the refund in any instrument transferring rights in the invention to any party.</P>
                                <P>(7) The Contractor shall furnish to the Contracting Officer the following:</P>
                                <P>(i) Interim reports every 12 months (or any longer period as may be specified by the Contracting Officer) from the date of the contract, listing subject inventions during that period and stating that all subject inventions have been disclosed or that there are no subject inventions.</P>
                                <P>(ii) A final report, within 3 months after completion of the contracted work, listing all subject inventions or stating that there were no subject inventions, and listing all subcontracts at any tier containing a patent rights clause or stating that there were no subcontracts.</P>
                                <P>(8)(i) The Contractor shall promptly notify the Contracting Officer in writing upon the award of any subcontract at any tier containing a patent rights clause by identifying—</P>
                                <P>(A) The subcontractor;</P>
                                <P>(B) The applicable patent rights clause;</P>
                                <P>(C) The work to be performed under the subcontract; and</P>
                                <P>(D) The dates of award and estimated completion.</P>
                                <P>(ii) The Contractor shall furnish, upon request, a copy of the subcontract, and no more frequently than annually, a listing of the subcontracts that have been awarded.</P>
                                <P>(9) In the event of a refusal by a prospective subcontractor to accept one of the clauses specified in paragraph (l)(1) of this clause, the Contractor—</P>
                                <P>(i) Shall promptly submit a written notice to the Contracting Officer setting forth the subcontractor's reasons for the refusal and other pertinent information that may expedite disposition of the matter; and</P>
                                <P>(ii) Shall not proceed with that subcontract without the written authorization of the Contracting Officer.</P>
                                <P>(10) The Contractor shall provide to the Contracting Officer, upon request, the following information for any subject invention for which the Contractor has retained ownership:</P>
                                <P>(i) Filing date.</P>
                                <P>(ii) Serial number and title.</P>
                                <P>(iii) A copy of any patent application (including an English-language version if filed in a language other than English).</P>
                                <P>(iv) Patent number and issue date.</P>
                                <P>(11) The Contractor shall furnish to the Government, upon request, an irrevocable power to inspect and make copies of any patent application file.</P>
                                <P>
                                    (f) 
                                    <E T="03">Reporting on utilization of subject inventions.</E>
                                     (1) The Contractor shall—
                                </P>
                                <P>(i) Submit upon request periodic reports no more frequently than annually on the utilization of a subject invention or on efforts in obtaining utilization of the subject invention that are being made by the Contractor or its licensees or assignees;</P>
                                <P>(ii) Include in the reports information regarding the status of development, date of first commercial sale or use, gross royalties received by the Contractor, and other information as the agency may reasonably specify; and</P>
                                <P>(iii) Provide additional reports that the agency may request in connection with any march-in proceedings undertaken by the agency in accordance with paragraph (h) of this clause.</P>
                                <P>
                                    (2) To the extent permitted by law, the agency shall not disclose the information provided under paragraph (f)(1) of this clause to persons outside the Government without 
                                    <PRTPAGE P="668"/>
                                    the Contractor's permission, if the data or information is considered by the Contractor or its licensee or assignee to be “privileged and confidential” (see 5 U.S.C. 552(b)(4)) and is so marked.
                                </P>
                                <P>
                                    (g) 
                                    <E T="03">Preference for United States industry.</E>
                                     Notwithstanding any other provision of this clause, the Contractor agrees that neither the Contractor nor any assignee shall grant to any person the exclusive right to use or sell any subject invention in the United States unless the person agrees that any products embodying the subject invention or produced through the use of the subject invention will be manufactured substantially in the United States. However, in individual cases, the agency may waive the requirement for an exclusive license agreement upon a showing by the Contractor or its assignee that—
                                </P>
                                <P>(1) Reasonable but unsuccessful efforts have been made to grant licenses on similar terms to potential licensees that would be likely to manufacture substantially in the United States; or</P>
                                <P>(2) Under the circumstances, domestic manufacture is not commercially feasible.</P>
                                <P>
                                    (h) 
                                    <E T="03">March-in rights.</E>
                                     The Contractor acknowledges that, with respect to any subject invention in which it has retained ownership, the agency has the right to require licensing pursuant to 35 U.S.C. 203 and 210(c), 37 CFR 401.6, and any supplemental regulations of the agency in effect on the date of contract award.
                                </P>
                                <P>
                                    (i) 
                                    <E T="03">Other inventions.</E>
                                     Nothing contained in this clause shall be deemed to grant to the Government any rights with respect to any invention other than a subject invention.
                                </P>
                                <P>
                                    (j) 
                                    <E T="03">Examination of records relating to inventions.</E>
                                     (1) The Contracting Officer or any authorized representative shall, until 3 years after final payment under this contract, have the right to examine any books (including laboratory notebooks), records, and documents of the Contractor relating to the conception or first reduction to practice of inventions in the same field of technology as the work under this contract to determine whether—
                                </P>
                                <P>(i) Any inventions are subject inventions;</P>
                                <P>(ii) The Contractor has established procedures required by paragraph (e)(5) of this clause; and</P>
                                <P>(iii) The Contractor and its inventors have complied with the procedures.</P>
                                <P>(2) If the Contracting Officer learns of an unreported Contractor invention that the Contracting Officer believes may be a subject invention, the Contractor shall be required to disclose the invention to the agency for a determination of ownership rights.</P>
                                <P>(3) Any examination of records under this paragraph (j) shall be subject to appropriate conditions to protect the confidentiality of the information involved.</P>
                                <P>
                                    (k) 
                                    <E T="03">Withholding of payment (this paragraph does not apply to subcontracts).</E>
                                     (1) Any time before final payment under this contract, the Contracting Officer may, in the Government's interest, withhold payment until a reserve not exceeding $50,000 or 5 percent of the amount of the contract, whichever is less, is set aside if, in the Contracting Officer's opinion, the Contractor fails to—
                                </P>
                                <P>(i) Establish, maintain, and follow effective procedures for identifying and disclosing subject inventions pursuant to paragraph (e)(5) of this clause;</P>
                                <P>(ii) Disclose any subject invention pursuant to paragraph (c)(1) of this clause;</P>
                                <P>(iii) Deliver acceptable interim reports pursuant to paragraph (e)(7)(i) of this clause; or</P>
                                <P>(iv) Provide the information regarding subcontracts pursuant to paragraph (e)(8) of this clause.</P>
                                <P>(2) The reserve or balance shall be withheld until the Contracting Officer has determined that the Contractor has rectified whatever deficiencies exist and has delivered all reports, disclosures, and other information required by this clause.</P>
                                <P>(3) The Government will not make final payment under this contract before the Contractor delivers to the Contracting Officer—</P>
                                <P>(i) All disclosures of subject inventions required by paragraph (c)(1) of this clause;</P>
                                <P>(ii) An acceptable final report pursuant to paragraph (e)(7)(ii) of this clause; and</P>
                                <P>(iii) All past due confirmatory instruments.</P>
                                <P>(4) The Contracting Officer may decrease or increase the sums withheld up to the maximum authorized in paragraph (k)(1) of this clause. No amount shall be withheld under this paragraph while the amount specified by this paragraph is being withheld under other provisions of the contract. The withholding of any amount or the subsequent payment thereof shall not be construed as a waiver of any Government right.</P>
                                <P>
                                    (l) 
                                    <E T="03">Subcontracts.</E>
                                     (1) The Contractor—
                                </P>
                                <P>(i) Shall include the substance of the Patent Rights-Ownership by the Contractor clause set forth at 52.227-11 of the Federal Acquisition Regulation (FAR), in all subcontracts for experimental, developmental, or research work to be performed by a small business concern or nonprofit organization; and</P>
                                <P>(ii) Shall include the substance of this clause, including this paragraph (l), in all other subcontracts for experimental, developmental, or research work, unless a different patent rights clause is required by FAR 27.303.</P>
                                <P>(2) For subcontracts at any tier—</P>
                                <P>
                                    (i) The patents rights clause included in the subcontract shall retain all references to the Government and shall provide to the subcontractor all the rights and obligations provided to the Contractor in the clause. The 
                                    <PRTPAGE P="669"/>
                                    Contractor shall not, as consideration for awarding the subcontract, obtain rights in the subcontractor's subject inventions; and
                                </P>
                                <P>(ii) The Government, the Contractor, and the subcontractor agree that the mutual obligations of the parties created by this clause constitute a contract between the subcontractor and the Government with respect to those matters covered by this clause. However, nothing in this paragraph is intended to confer any jurisdiction under the Contract Disputes statute in connection with proceedings under paragraph (h) of this clause.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate I</E>
                                 (DEC 2007). As prescribed in 227.303(2)(ii), add the following paragraph (b)(2)(v) to the basic clause:
                            </P>
                            <EXTRACT>
                                <P>(v) The license shall include the right of the Government to sublicense foreign governments, their nationals, and international organizations pursuant to the following treaties or international agreements: ________________*.</P>
                                <P>
                                    <E T="03">[* Contracting Officer to complete with the names of applicable existing treaties or international agreements. This paragraph is not intended to apply to treaties or agreements that are in effect on the date of the award but are not listed.]</E>
                                </P>
                            </EXTRACT>
                            <P>
                                <E T="03">Alternate II</E>
                                 (DEC 2007). As prescribed in 227.303(2)(iii), add the following paragraph (b)(2)(v) to the basic clause:
                            </P>
                            <EXTRACT>
                                <P>(v) The agency reserves the right to—</P>
                                <P>(A) Unilaterally amend this contract to identify specific treaties or international agreements entered into or to be entered into by the Government after the effective date of this contract; and</P>
                                <P>(B) Exercise those license or other rights that are necessary for the Government to meet its obligations to foreign governments, their nationals, and international organizations under any treaties or international agreement with respect to subject inventions made after the date of the amendment.</P>
                            </EXTRACT>
                            <CITA>[72 FR 69160, Dec. 7, 2007, as amended at 77 FR 76938, Dec. 31, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.227-7039</SECTNO>
                            <SUBJECT>Patents—reporting of subject inventions.</SUBJECT>
                            <P>As prescribed in 227.303(1), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Patents—Reporting of Subject Inventions (APR 1990)</HD>
                                <P>The Contractor shall furnish the Contracting Officer the following:</P>
                                <P>(a) Interim reports every twelve (12) months (or such longer period as may be specified by the Contracting Officer) from the date of the contract, listing subject inventions during that period and stating that all subject inventions have been disclosed or that there are no such inventions.</P>
                                <P>(b) A final report, within three (3) months after completion of the contracted work, listing all subject inventions or stating that there were no such inventions.</P>
                                <P>(c) Upon request, the filing date, serial number and title, a copy of the patent application and patent number, and issue data for any subject invention for which the Contractor has retained title.</P>
                                <P>(d) Upon request, the Contractor shall furnish the Government an irrevocable power to inspect and make copies of the patent application file.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 72 FR 69162, Dec. 7, 2007]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.228-7000</SECTNO>
                            <SUBJECT>Reimbursement for War-Hazard Losses.</SUBJECT>
                            <P>As prescribed in 228.371(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Reimbursement for War-Hazard Losses (DEC 1991)</HD>
                                <P>(a) Costs for providing employee war-hazard benefits in accordance with paragraph (b) of the Workers' Compensation and War-Hazard Insurance clause of this contract are allowable if the Contractor—</P>
                                <P>(1) Submits proof of loss files to support payment or denial of each claim;</P>
                                <P>(2) Subject to Contracting Officer approval, makes lump sum final settlement of any open claims and obtains necessary release documents within one year of the expiration or termination of this contract, unless otherwise extended by the Contracting Officer; and</P>
                                <P>(3) Provides the Contracting Officer at the time of final settlement of this contract—</P>
                                <P>(i) An investigation report and evaluation of any potential claim; and</P>
                                <P>(ii) An estimate of the dollar amount involved should the potential claim mature.</P>
                                <P>(b) The cost of insurance for liabilities reimbursable under this clause is not allowable.</P>
                                <P>(c) The Contracting Officer may require the Contractor to assign to the Government all right, title, and interest to any refund, rebate, or recapture arising out of any claim settlements.</P>
                                <P>(d) The Contractor agrees to—</P>
                                <P>(1) Investigate and promptly notify the Contracting Officer in writing of any occurrence which may give rise to a claim or potential claim, including the estimated amount of the claim;</P>
                                <P>
                                    (2) Give the Contracting Officer immediate written notice of any suit or action filed 
                                    <PRTPAGE P="670"/>
                                    which may result in a payment under this clause; and
                                </P>
                                <P>(3) Provide assistance to the Government in connection with any third party suit or claim relating to this clause which the Government elects to prosecute or defend in its own behalf.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 88 FR 17352, Mar. 22, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.228-7001</SECTNO>
                            <SUBJECT>Ground and Flight Risk.</SUBJECT>
                            <P>As prescribed in 228.371(b), use the following clause:</P>
                            <HD SOURCE="HD1">Ground and Flight Risk (MAR 2023)</HD>
                            <EXTRACT>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Aircraft</E>
                                     means, unless otherwise provided in the contract Schedule, any item, other than a rocket or missile, intended for flight (
                                    <E T="03">e.g.,</E>
                                     fixed-winged aircraft, blended wing/lifting bodies, helicopters, vertical take-off or landing aircraft, lighter-than-air airships, and unmanned aerial vehicles), including emerging technologies that would commonly be considered aircraft. New production articles become aircraft at a stage of manufacture or production when a wing, portion of a wing, or engine is attached to a fuselage. Blended wing/lifting bodies become aircraft at a stage of manufacture or production when the center portion and a lifting surface become attached.
                                </P>
                                <P>
                                    <E T="03">Contractor's managerial personnel</E>
                                     means the Contractor's directors, officers, managers, superintendents, or equivalent representatives who have supervision or direction of—
                                </P>
                                <P>(1) All, or substantially all, of the Contractor's business;</P>
                                <P>(2) All, or substantially all, of the Contractor's operation at any one plant or separate location; or</P>
                                <P>(3) A separate and complete major industrial operation.</P>
                                <P>
                                    <E T="03">Contractor's premises</E>
                                     means those premises, including subcontractors' premises, designated in the Schedule or in writing by the Contracting Officer, and any other place the aircraft is moved for safeguarding.
                                </P>
                                <P>
                                    <E T="03">Covered aircraft</E>
                                     means an aircraft owned by or to be delivered to the Government and, when determined by the contracting officer and specifically identified as such in the contract Schedule, may include contractor-furnished aircraft that are not intended for induction into the DoD inventory, including—
                                </P>
                                <P>(1) Aircraft furnished by the Government to the Contractor under this contract while in the Contractor's possession, care, custody, or control regardless of their location or state of disassembly or reassembly;</P>
                                <P>(2) Items removed from a Government furnished aircraft that are—</P>
                                <P>(i) Intended for reinstallation on that particular aircraft, which retain their status as covered aircraft while awaiting installation; and</P>
                                <P>(ii) Not intended for reinstallation on that particular aircraft, which lose their status as covered aircraft once removal is complete;</P>
                                <P>
                                    (3) New production aircraft when wholly outside of buildings on the Contractor's premises or other places described in the Schedule (
                                    <E T="03">e.g.,</E>
                                     hush houses, run stations, and paint facilities); and
                                </P>
                                <P>(4) Commercial aircraft, to include commercially available off-the-shelf aircraft, become covered aircraft when the commercial aircraft arrives at the Contractor's place of performance for modification under the terms of the contract.</P>
                                <P>
                                    <E T="03">Crewmember</E>
                                     means, unless otherwise provided in the Schedule, personnel required in the flight manual, assigned for the purpose of conducting any flight on behalf of the Contractor. It also includes any operator of an unmanned aerial vehicle.
                                </P>
                                <P>
                                    <E T="03">Flight</E>
                                     means any flight approved in writing by the Government flight representative, to include taxi test made in the performance of this contract, or flight for the purpose of safeguarding the aircraft. All aircraft off the Contractor's premises shall be considered to be in flight when on the ground or water for reasonable periods of time following emergency landings, landings made in performance of the contract, or landings approved in writing by the contracting officer.
                                </P>
                                <P>
                                    <E T="03">Workmanship error</E>
                                     means damage to the aircraft that is the result of an incorrectly performed skill-based task, operation, or action that was originally planned or intended.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Combined regulation/instruction.</E>
                                     The Contractor shall be bound by the operating procedures contained in the combined regulation/instruction entitled “Contractor's Flight and Ground Operations” (Air Force Instruction 10-220, Army Regulation 95-20, NAVAIR Instruction 3710.1 (Series), Coast Guard Instruction M13020.3 (Series), and Defense Contract Management Agency Instruction 8210-1 (Series) in effect on the date of contract award. Compliance with the combined regulation/instruction is required from the time of contract award throughout the period of performance of the contract, regardless of the Government's assumption of risk under the contract.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Government as self-insurer.</E>
                                     The Government self-insures and assumes the risk of damage to, or loss or destruction of, covered aircraft subject to the following conditions:
                                </P>
                                <P>(1) The Contractor's liability to the Government for damage, loss, or destruction of covered aircraft is limited to the Contractor's share of loss as defined at paragraph (h) of this clause, except when one of the exclusions at paragraph (d) applies.</P>
                                <P>
                                    (2) The liability provisions of this clause take precedence over the liability provisions 
                                    <PRTPAGE P="671"/>
                                    of Federal Acquisition Regulation (FAR) clause 52.245-1, Government Property, with respect to covered aircraft.
                                </P>
                                <P>(3) The Contractor is not liable for loss, damage, or destruction of covered aircraft as the result of normal wear and tear, or intentional damage or destruction as required in the Schedule.</P>
                                <P>(4) Conditions for Government assumption of risk in flight are as follows:</P>
                                <P>(i) The Contractor's crewmembers are approved in writing by the Government flight representative (GFR).</P>
                                <P>(ii) The flight is approved in writing by the GFR.</P>
                                <P>
                                    (d) 
                                    <E T="03">Exclusions from the Government's assumption of risk.</E>
                                     The Government's assumption of risk under this clause shall not extend to damage, loss, or destruction of covered aircraft which—
                                </P>
                                <P>(1) Is the result of willful misconduct or lack of good faith on the part of the Contractor's managerial personnel, including the Contractor's oversight of subcontractors;</P>
                                <P>(2) Is sustained during flight if either the flight or the crewmembers have not been approved in advance and in writing by the GFR, who has been authorized in accordance with the combined regulation/instruction entitled “Contractor's Flight and Ground Operations”;</P>
                                <P>(3) Occurs in the course of transportation by rail, or by conveyance on public streets, highways, or waterways, unless the transportation is limited to the vicinity of the Contractor's premises, and incidental to work performed under the contract as described in the Schedule;</P>
                                <P>(4) Is covered by insurance;</P>
                                <P>(5) Occurs after the Contracting Officer has, in writing, revoked the Government's assumption of risk in accordance with paragraph (e)(3) of this clause; or</P>
                                <P>(6) Is sustained due to workmanship errors.</P>
                                <P>
                                    (e) 
                                    <E T="03">Revoking the Government's assumption of risk.</E>
                                </P>
                                <P>(1) The Contracting Officer, when finding that the Contractor's managerial personnel have failed to comply with paragraph (b) of this clause, will issue a preliminary notice of revocation requiring the Contractor to comply with contract requirements within a timeframe specified by the Contracting Officer. In determining exposure to unreasonable conditions, the Contracting Officer will consider factors including, but not limited to, the following: lack of adequate hangar fire suppression or firefighting vehicles, failure to provide adequate procedures to the GFR, or systemic failure to comply with approved procedures.</P>
                                <P>(2) Upon receipt of the preliminary notice of revocation, the Contractor shall promptly correct the noncompliance or cited conditions, regardless of whether there is agreement that the conditions are unreasonable.</P>
                                <P>(3) If the Contracting Officer finds that the Contractor failed to correct the cited noncompliance or conditions within the specified timeframe, the Contracting Officer will issue a notice of revocation of the Government's assumption of risk for any covered aircraft.</P>
                                <P>(4) If the Contracting Officer issues a notice of revocation pursuant to the terms of this clause—</P>
                                <P>(i) The Contractor shall thereafter assume the entire risk for damage, loss, or destruction of the previously covered aircraft;</P>
                                <P>(ii) Any costs incurred by the Contractor (including the costs of the Contractor's self-insurance, insurance premiums paid to insure the Contractor's assumption of risk, deductibles associated with such purchased insurance, etc.) to mitigate its risk are unallowable costs; and</P>
                                <P>(iii) The liability provisions of the clause at FAR 52.245-1, Government Property, are not applicable to the aircraft impacted by the notice of revocation.</P>
                                <P>(5) The Contractor shall promptly notify the Contracting Officer when the noncompliance or cited conditions have been corrected. Within 3 days of receipt of the Contractor's notice of correction, the Contracting Officer will notify the Contractor whether the Government will resume risk of loss. The Contracting Officer will determine that the noncompliance or cited conditions have been corrected prior to resuming assumption of risk.</P>
                                <P>(6) The notice of revocation does not relieve the Contractor of its obligation to comply with all other provisions of this clause, including the combined regulation/instruction entitled “Contractor's Flight and Ground Operations.”</P>
                                <P>(7) Any disputes regarding the Contracting Officer's notice of revocation shall be subject to FAR clause 52.233-1, Disputes.</P>
                                <P>
                                    (f) 
                                    <E T="03">Contractor's exclusion of insurance costs.</E>
                                     The Contractor warrants that the contract price does not and will not include, except as may be authorized in this clause, any charge or contingency reserve for insurance (including the Contractor's share of loss) covering damage, loss, or destruction of covered aircraft when the risk has been assumed by the Government, even if the assumption may be terminated for covered aircraft.
                                </P>
                                <P>
                                    (g) 
                                    <E T="03">Procedures in the event of damage, loss, or destruction.</E>
                                </P>
                                <P>(1) In the event of damage, loss, or destruction of covered aircraft, the Contractor shall take all reasonable steps to protect the aircraft from further damage, to separate damaged and undamaged aircraft, and to put all aircraft in the best possible order. Except in cases covered by paragraph (h)(2) of this clause, the Contractor shall furnish to the Contracting Officer a statement of—</P>
                                <P>
                                    (i) The damaged, lost, or destroyed aircraft;
                                    <PRTPAGE P="672"/>
                                </P>
                                <P>(ii) The time and origin of the damage, loss, or destruction;</P>
                                <P>(iii) All known interests in commingled property of which aircraft are a part; and</P>
                                <P>(iv) The insurance, if any, covering the interest in commingled property.</P>
                                <P>(2) If a new production aircraft is damaged, lost, or destroyed before it has become a covered aircraft, the Government bears no responsibility for risk of loss.</P>
                                <P>(3) If a new production aircraft is damaged, lost, or destroyed after it has become a covered aircraft, the Contractor shall take action in accordance with the Contracting Officer's written direction that the aircraft shall be—</P>
                                <P>(i) Replaced;</P>
                                <P>(ii) Repaired to the condition immediately prior to the damage; or</P>
                                <P>(iii) Considered beyond economic repair. The Contracting Officer will decide whether further actions are required under the contract.</P>
                                <P>(4) If a covered aircraft that has been furnished by the Government to the Contractor is damaged, lost, or destroyed while covered, the Contractor shall take action in accordance with the Contracting Officer's written direction that the aircraft shall be—</P>
                                <P>(i) Repaired; or</P>
                                <P>(ii) Considered beyond economic repair. The Contracting Officer will decide further actions required under the contract.</P>
                                <P>(5) The Contracting Officer will make an equitable adjustment for expenditures made in performing the obligations under this paragraph (g).</P>
                                <P>
                                    (h) 
                                    <E T="03">Contractor's share of loss.</E>
                                </P>
                                <P>(1) The Contractor's share of loss or damage to covered aircraft, except for loss or damage caused by negligence of Government personnel, is the least of—</P>
                                <P>(i) $200,000;</P>
                                <P>(ii) 20 percent of the price or estimated acquisition cost of affected aircraft; or</P>
                                <P>(iii) 20 percent of the price or estimated cost of the contract, task order, or delivery order.</P>
                                <P>(2) If the Government requires covered aircraft be replaced or repaired by the Contractor, any resulting equitable adjustment shall not include reimbursement of the Contractor's share of loss.</P>
                                <P>(3) In the event the Government does not decide to replace or repair, the Contractor agrees to credit the contract price or pay the Government, as directed by the Contracting Officer, the least of—</P>
                                <P>(i) $200,000;</P>
                                <P>(ii) 20 percent of the price or estimated acquisition cost of affected aircraft; or</P>
                                <P>(iii) 20 percent of the price or estimated cost of the contract, task order, or delivery order.</P>
                                <P>(4) The costs incurred by the Contractor for its share of the loss and for insuring against that loss are unallowable costs, including but not limited to—</P>
                                <P>(i) The Contractor's share of loss under the Government's self-insurance;</P>
                                <P>(ii) The costs of the Contractor's self-insurance;</P>
                                <P>(iii) The deductible for any Contractor-purchased insurance;</P>
                                <P>(iv) Insurance premiums paid for Contractor-purchased insurance; and</P>
                                <P>(v) Costs associated with determining, litigating, and defending against the Contractor's liability.</P>
                                <P>
                                    (i) 
                                    <E T="03">Reimbursement from a third party.</E>
                                     In the event the Contractor is reimbursed or compensated by a third party for damage, loss, or destruction of covered aircraft and has also been compensated by the Government, the Contractor shall equitably reimburse the Government. The Contractor shall do nothing to prejudice the Government's right to recover against third parties for damage, loss, or destruction. Upon the request of the Contracting Officer or authorized representative, the Contractor shall at Government expense furnish to the Government all reasonable assistance and cooperation (including the prosecution of suit and the execution of instruments of assignment or subrogation) in obtaining recovery.
                                </P>
                                <P>
                                    (j) 
                                    <E T="03">Liability to third parties.</E>
                                     Unless the flight and crewmembers have been approved in writing by the GFR, the Contractor shall not be reimbursed for liability to third parties for loss or damage to property or for death or bodily injury caused by covered aircraft during flight, even if the Government has accepted such liability under any other provisions of the contract.
                                </P>
                                <P>
                                    (k) 
                                    <E T="03">Subcontracts.</E>
                                     The Contractor shall incorporate the requirements of this clause, including this paragraph (k), in subcontracts to include subcontracts for commercial products and commercial services, except—
                                </P>
                                <P>(1) The Contractor shall not include paragraph (f) of this clause in subcontracts for commercial products or commercial services; and</P>
                                <P>(2) The Contractor shall not incorporate the requirements of this clause in subcontracts with Federal Aviation Administration (FAA) part 145 repair stations performing work pursuant to their FAA license.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[88 FR 17352, Mar. 22, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.228-7002</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.228-7003</SECTNO>
                            <SUBJECT>Capture and Detention.</SUBJECT>
                            <P>As prescribed in 228.371(c), use the following clause:</P>
                            <EXTRACT>
                                <PRTPAGE P="673"/>
                                <HD SOURCE="HD1">Capture and Detention (DEC 1991)</HD>
                                <P>(a) As used in this clause—</P>
                                <P>
                                    (1) 
                                    <E T="03">Captured person</E>
                                     means any employee of the Contractor who is—
                                </P>
                                <P>(i) Assigned to duty outside the United States for the performance of this contract; and</P>
                                <P>(ii) Found to be missing from his or her place of employment under circumstances that make it appear probable that the absence is due to the action of the force of any power not allied with the United States in a common military effort; or</P>
                                <P>(iii) Known to have been taken prisoner, hostage, or otherwise detained by the force of such power, whether or not actually engaged in employment at the time of capture; provided, that at the time of capture or detention, the person was either—</P>
                                <P>(A) Engaged in activity directly arising out of and in the course of employment under this contract; or</P>
                                <P>(B) Captured in an area where required to be only in order to perform this contract.</P>
                                <P>
                                    (2) A 
                                    <E T="03">period of detention</E>
                                     begins with the day of capture and continues until the captured person is returned to the place of employment, the United States, or is able to be returned to the jurisdiction of the United States, or until the person's death is established or legally presumed to have occurred by evidence satisfactory to the Contracting Officer, whichever occurs first.
                                </P>
                                <P>
                                    (3) 
                                    <E T="03">United States</E>
                                     comprises geographically the 50 states and the District of Columbia.
                                </P>
                                <P>
                                    (4) 
                                    <E T="03">War Hazards Compensation Act</E>
                                     refers to the statute compiled in chapter 12 of title 42, U.S. Code (sections 1701-1717), as amended.
                                </P>
                                <P>(b) If pursuant to an agreement entered into prior to capture, the Contractor is obligated to pay and has paid detention benefits to a captured person, or the person's dependents, the Government will reimburse the Contractor up to an amount equal to the lesser of—</P>
                                <P>(1) Total wage or salary being paid at the time of capture due from the Contractor to the captured person for the period of detention; or</P>
                                <P>(2) That amount which would have been payable if the detention had occurred under circumstances covered by the War Hazards Compensation Act.</P>
                                <P>(c) The period of detention shall not be considered as time spent in contract performance, and the Government shall not be obligated to make payment for that time except as provided in this clause.</P>
                                <P>(d) The obligation of the Government shall apply to the entire period of detention, except that it is subject to the availability of funds from which payment can be made. The rights and obligations of the parties under this clause shall survive prior expiration, completion, or termination of this contract.</P>
                                <P>(e) The Contractor shall not be reimbursed under this clause for payments made if the employees were entitled to compensation for capture and detention under the War Hazards Compensation Act, as amended.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 57 FR 42633, Sept. 15, 1992; 75 FR 32647, June 8, 2010; 88 FR 17353, Mar. 22, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.228-7004</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.228-7005</SECTNO>
                            <SUBJECT>Mishap Reporting and Investigation Involving Aircraft, Missiles, and Space Launch Vehicles.</SUBJECT>
                            <P>As prescribed in 228.371(d), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Mishap Reporting and Investigation Involving Aircraft, Missiles, and Space Launch Vehicles (NOV 2019)</HD>
                                <P>(a) The Contractor shall report promptly to the Administrative Contracting Officer all pertinent facts relating to each mishap involving an aircraft, missile, or space launch vehicle being manufactured, modified, repaired, or overhauled in connection with this contract.</P>
                                <P>(b) If the Government conducts an investigation of the mishap, the Contractor shall cooperate and assist the Government's personnel until the investigation is complete.</P>
                                <P>(c) The Contractor shall include a clause in subcontracts under this contract to require subcontractor cooperation and assistance in mishap investigations.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 75 FR 32647, June 8, 2010, 84 FR 65312, Nov. 27, 2019; 88 FR 17354, Mar. 22, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.228-7006</SECTNO>
                            <SUBJECT>Compliance with Spanish Laws and Insurance.</SUBJECT>
                            <P>As prescribed at 228.371(e), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Compliance with Spanish Laws and Insurance (DEC 1998)</HD>
                                <P>(a) The requirements of this clause apply only if the Contractor is not a Spanish concern.</P>
                                <P>
                                    (b) The Contractor shall, without additional expense to the United States Government, comply with all applicable Spanish Government laws pertaining to sanitation, traffic, security, employment of labor, and all other laws relevant to the performance of this contract. The Contractor shall hold the United States Government harmless and free 
                                    <PRTPAGE P="674"/>
                                    from any liability resulting from the Contractor's failure to comply with such laws.
                                </P>
                                <P>(c) The contractor shall, at its own expense, provide and maintain during the entire performance of this contract, all workmen's compensation, employees' liability, bodily injury insurance, and other required insurance adequate to cover the risk assumed by the Contractor. The Contractor shall indemnify and hold harmless the United States Government from liability resulting from all claims for damages as a result of death or injury to personnel or damage to real or personal property related to the performance of this contract.</P>
                                <P>(d) The Contractor agrees to represent in writing to the Contracting Officer, prior to commencement of work and not later than 15 days after the date of the Notice to Proceed, that the Contractor has obtained the required types of insurance in the following minimum amounts. The representation also shall state that the Contractor will promptly notify the Contracting Officer of any notice of cancellation of insurance or material change in insurance coverage that could affect the United States Government's interests.</P>
                            </EXTRACT>
                            <GPOTABLE COLS="4" OPTS="L2" CDEF="s10,10,10,10">
                                <BOXHD>
                                    <CHED H="1">Type of insurance</CHED>
                                    <CHED H="1">Coverage per person</CHED>
                                    <CHED H="1">Coverage per accident</CHED>
                                    <CHED H="1">Property damage</CHED>
                                </BOXHD>
                                <ROW>
                                    <ENT I="01">Comprehensive General Liability</ENT>
                                    <ENT>$300,000</ENT>
                                    <ENT>$1,000,000</ENT>
                                    <ENT>$100,000</ENT>
                                </ROW>
                            </GPOTABLE>
                            <EXTRACT>
                                <P>(e) The Contractor shall provide the Contracting Officer with a similar representation for all subcontracts with non-Spanish concerns that will perform work in Spain under this contract.</P>
                                <P>(f) Insurance policies required herein shall be purchased from Spanish insurance companies or other insurance companies legally authorized to conduct business in Spain. Such policies shall conform to Spanish laws and regulations and shall—</P>
                                <P>(1) Contain provisions requiring submission to Spanish law and jurisdiction of any problem that may arise with regard to the interpretation or application of the clauses and conditions of the insurance policy;</P>
                                <P>(2) Contain a provision authorizing the insurance company, as subrogee of the insured entity, to assume and attend to directly, with respect to any person damaged, the legal consequences arising from the occurrence of such damages;</P>
                                <P>(3) Contain a provision worded as follows: “The insurance company waives any right of subrogation against the United States of America that may arise by reason of any payment under this policy.”;</P>
                                <P>(4) Not contain any deductible amount or similar limitation; and</P>
                                <P>(5) Not contain any provisions requiring submission to any type of arbitration.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[62 FR 34132, June 24, 1997, as amended at 63 FR 69006, Dec. 15, 1998; 75 FR 32647, June 8, 2010; 88 FR 17354, Mar. 22, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.228-7007</SECTNO>
                            <SUBJECT>Public Aircraft and State Aircraft Operations—Liability.</SUBJECT>
                            <P>As prescribed in 228.371(f), use the following clause:</P>
                            <HD SOURCE="HD1">Public Aircraft and State Aircraft Operations—Liability (MAR 2023)</HD>
                            <EXTRACT>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Civil aircraft</E>
                                     means an aircraft other than a public aircraft or state aircraft.
                                </P>
                                <P>
                                    <E T="03">Public aircraft</E>
                                     means an aircraft that meets the definition in 49 U.S.C. 40102(a)(41) and the qualifications in 49 U.S.C. 40125. Specifically, a public aircraft means any of the following:
                                </P>
                                <P>(1) An aircraft used only for the Government, except as provided in paragraphs (5) and (7) of this definition.</P>
                                <P>(2) An aircraft owned by the Government and operated by any person for purposes related to crew training, equipment development, or demonstration, except as provided in paragraph (7) of this definition.</P>
                                <P>(3) An aircraft owned and operated by the government of a State, the District of Columbia, or a territory or possession of the United States or a political subdivision of one of these governments, except as provided in paragraph (7) of this definition.</P>
                                <P>(4) An aircraft exclusively leased for at least 90 continuous days by the government of a State, the District of Columbia, or a territory or possession of the United States or a political subdivision of one of these governments, except as provided in paragraph (7) of this definition.</P>
                                <P>(5) An aircraft owned or operated by the armed forces or chartered to provide transportation or other commercial air service to the armed forces under the conditions specified by 49 U.S.C. 40125(c). In the preceding sentence, the term “other commercial air service” means an aircraft operation that—</P>
                                <P>(i) Is within the United States territorial airspace;</P>
                                <P>(ii) The Administrator of the Federal Aviation Administration determines is available for compensation or hire to the public; and</P>
                                <P>(iii) Must comply with all applicable civil aircraft rules under title 14, Code of Federal Regulations.</P>
                                <P>(6) An unmanned aircraft that is owned and operated, or exclusively leased for at least 90 continuous days, by an Indian Tribal government, as defined in section 102 of the Robert T. Stafford Disaster Relief and Emergency Assistance Act (42 U.S.C. 5122), except as provided in paragraph (7) of this definition.</P>
                                <P>
                                    (7) As described in 49 U.S.C. 40125(b), an aircraft described in paragraph (1), (2), (3), or (4) 
                                    <PRTPAGE P="675"/>
                                    of this definition does not qualify as a public aircraft when the aircraft is used for commercial purposes or to carry an individual other than a crewmember or a qualified non-crewmember.
                                </P>
                                <P>
                                    <E T="03">Public aircraft operation</E>
                                     means operation of an aircraft that meets the legal definition of public aircraft established in 49 U.S.C. 40102(a)(41) and the legal qualifications for public aircraft status outlined in 49 U.S.C. 40125.
                                </P>
                                <P>
                                    <E T="03">State aircraft</E>
                                     means an aircraft operated by the Government for sovereign, noncommercial purposes such as military, customs, and police services. Military aircraft are afforded status as state aircraft. In very rare circumstances, DoD-contracted aircraft may be designated, in writing, by a responsible Government official pursuant to DoD Directive 4500.54E, DoD Foreign Clearance Program, to be operated in state aircraft status, and such status cannot be deemed without a written designation by an authorized Government official.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Combined regulation/instruction.</E>
                                     Upon award, for contract performance to be conducted as a public aircraft operation, the Contractor shall be bound by the operating procedures contained in the combined regulation/instruction entitled “Contractor's Flight and Ground Operations” (Air Force Instruction 10-220, Army Regulation 95-20, NAVAIR Instruction 3710.1 (Series), Coast Guard Instruction M13020.3 (Series), and Defense Contract Management Agency Instruction 8210-1 (Series)) in effect on the date of contract award.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Contractor liability for operations for contract performance conducted as public aircraft operations or state aircraft operations.</E>
                                </P>
                                <P>(1) The Contractor assumes responsibility for all damage or injury to persons or property, including the Contractor's employees and property, and Government personnel and property, occasioned through the use, maintenance, and operation of the Contractor's aircraft or other equipment by, or the action of, the Contractor or the Contractor's employees and agents.</P>
                                <P>(2) The Contractor, at the Contractor's expense, shall maintain adequate public liability and property damage insurance, including hull insurance for the Contractor's aircraft, during the duration of this contract, insuring the Contractor against all claims for injury or damage.</P>
                                <P>(3) The Contractor shall maintain workers' compensation and other legally required insurance with respect to the Contractor's own employees and agents.</P>
                                <P>(4) The Government will in no event be liable or responsible for damage or injury to any person or property occasioned through the use, maintenance, or operation of any aircraft or other equipment by, or the action of, the Contractor or the Contractor's employees and agents in performing under this contract, and the Government shall be indemnified and saved harmless against claims for damage or injury in such cases.</P>
                            </EXTRACT>
                            <P>(End of clause)</P>
                            <CITA>[88 FR 17354, Mar. 22, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.229-7000</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.229-7001</SECTNO>
                            <SUBJECT>Tax Relief.</SUBJECT>
                            <P>
                                <E T="03">Basic.</E>
                                 As prescribed in 229.402-70(a) and (a)(1), use the following clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Tax Relief—Basic (APR 2020)</HD>
                                <P>(a) Prices set forth in this contract are exclusive of all taxes and duties from which the United States Government is exempt by virtue of tax agreements between the United States Government and the Contractor's government. The following taxes or duties have been excluded from the contract price:</P>
                                <HD SOURCE="HD3">NAME OF TAX: (Offeror Insert) RATE (PERCENTAGE): (Offeror Insert)</HD>
                                <P>(b) Invoices submitted in accordance with the terms and conditions of this contract shall be exclusive of all taxes or duties for which relief is available. The Contractor's invoice shall list separately the gross price, amount of tax deducted, and net price charged.</P>
                                <P>(c) When items manufactured to United States Government specifications are being acquired, the Contractor shall identify the materials or components intended to be imported in order to ensure that relief from import duties is obtained. If the Contractor intends to use imported products from inventories on hand, the price of which includes a factor for import duties, the Contractor shall ensure the United States Government's exemption from these taxes. The Contractor may obtain a refund of the import duties from its government or request the duty-free import of an amount of supplies or components corresponding to that used from inventory for this contract.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate I.</E>
                                 As prescribed in 229.402-70(a) and (a)(2), use the following clause, which adds a paragraph (d) not included in the basic clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Tax Relief—Alternate I (APR 2020)</HD>
                                <P>(a) Prices set forth in this contract are exclusive of all taxes and duties from which the United States Government is exempt by virtue of tax agreements between the United States Government and the Contractor's government. The following taxes or duties have been excluded from the contract price:</P>
                                <FP SOURCE="FP-1">
                                    NAME OF TAX: 
                                    <E T="03">[Offeror insert]</E>
                                    <PRTPAGE P="676"/>
                                </FP>
                                <FP SOURCE="FP-1">
                                    RATE (PERCENTAGE): 
                                    <E T="03">[Offeror insert]</E>
                                </FP>
                                <P>(b) Invoices submitted in accordance with the terms and conditions of this contract shall be exclusive of all taxes or duties for which relief is available. The Contractor's invoice shall list separately the gross price, amount of tax deducted, and net price charged.</P>
                                <P>(c) When items manufactured to United States Government specifications are being acquired, the Contractor shall identify the materials or components intended to be imported in order to ensure that relief from import duties is obtained. If the Contractor intends to use imported products from inventories on hand, the price of which includes a factor for import duties, the Contractor shall ensure the United States Government's exemption from these taxes. The Contractor may obtain a refund of the import duties from its government or request the duty-free import of an amount of supplies or components corresponding to that used from inventory for this contract.</P>
                                <P>(d) Tax relief will be claimed in Germany pursuant to the provisions of the Agreement Between the United States of America and Germany Concerning Tax Relief to be Accorded by Germany to United States Expenditures in the Interest of Common Defense. The Contractor shall use Abwicklungsschein fuer abgabenbeguenstigte Lieferungen/Leistungen nach dem Offshore Steuerabkommen (Performance Certificate for Tax-Free Deliveries/Performance according to the Offshore Tax Relief Agreement) or other documentary evidence acceptable to the German tax authorities. All purchases made and paid for on a tax-free basis during a 30-day period may be accumulated, totaled, and reported as tax-free.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[62 FR 34132, June 24, 1997, as amended at 79 FR 58700, Sept. 30, 2014; 80 FR 36899, June 26, 2015; 85 FR 19698, Apr. 8, 2020]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.229-7002</SECTNO>
                            <SUBJECT>Customs exemptions (Germany).</SUBJECT>
                            <P>As prescribed in 229.402-70(b), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Customs Exemptions (Germany) (JUN 1997)</HD>
                                <P>Imported products required for the direct benefit of the United States Forces are authorized to be acquired duty-free by the Contractor in accordance with the provisions of the Agreement Between the United States of America and Germany Concerning Tax Relief to be Accorded by Germany to United States Expenditures in the Interest of Common Defense.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[62 FR 34133, June 24, 1997]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.229-7003</SECTNO>
                            <SUBJECT>Tax Exemptions (Italy).</SUBJECT>
                            <P>As prescribed in 229.402-70(c)(1), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Tax Exemptions (Italy) (MAR 2012)</HD>
                                <P>(a) As the Contractor represented in its offer, the contract price, including the prices in subcontracts awarded under this contract, does not include taxes from which the United States Government is exempt.</P>
                                <P>(b) The United States Government is exempt from payment of Imposta Valore Aggiunto (IVA) tax in accordance with Article 72 of the IVA implementing decree on all supplies and services sold to United States Military Commands in Italy.</P>
                                <P>(1) The Contractor shall include the following information on invoices submitted to the United States Government:</P>
                                <P>(i) The contract number.</P>
                                <P>(ii) The IVA tax exemption claimed pursuant to Article 72 of Decree Law 633, dated October 26, 1972.</P>
                                <P>
                                    (iii) The following fiscal code(s): [
                                    <E T="03">Contracting Officer must insert the applicable fiscal code(s) for military activities within Italy: 80028250241 for Army, 80156020630 for Navy, or 91000190933 for Air Force</E>
                                    ].
                                </P>
                                <P>(2)(i) Upon receipt of the invoice, the paying office will include the following certification on one copy of the invoice:</P>
                                <P>“I certify that this invoice is true and correct and reflects expenditures made in Italy for the Common Defense by the United States Government pursuant to international agreements. The amount to be paid does not include the IVA tax, because this transaction is not subject to the tax in accordance with Article 72 of Decree Law 633, dated October 26, 1972.” An authorized United States Government official will sign the copy of the invoice containing this certification.</P>
                                <P>(ii) The paying office will return the certified copy together with payment to the Contractor. The payment will not include the amount of the IVA tax.</P>
                                <P>(iii) The Contractor shall retain the certified copy to substantiate non-payment of the IVA tax.</P>
                                <P>(3) The Contractor may address questions regarding the IVA tax to the Ministry of Finance, IVA Office, Rome (06) 520741.</P>
                                <P>(c) In addition to the IVA tax, purchases by the United States Forces in Italy are exempt from the following taxes:</P>
                                <P>(1) Imposta di Fabbricazione (Production Tax for Petroleum Products).</P>
                                <P>(2) Imposta di Consumo (Consumption Tax for Electrical Power).</P>
                                <P>
                                    (3) Dazi Doganali (Customs Duties).
                                    <PRTPAGE P="677"/>
                                </P>
                                <P>(4) Tassa di Sbarco e d'Imbarco sulle Merci Transportate per Via Aerea e per Via Maritima (Port Fees).</P>
                                <P>(5) Tassa de Circolazione sui Veicoli (Vehicle Circulation Tax).</P>
                                <P>(6) Imposta di Registro (Registration Tax).</P>
                                <P>(7) Imposta di Bollo (Stamp Tax).</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[67 FR 4210, Jan. 29, 2002, as amended at 77 FR 19131, Mar. 30, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.229-7004</SECTNO>
                            <SUBJECT>Status of contractors as a direct contractor (Spain).</SUBJECT>
                            <P>As prescribed in 229.402-70(d), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Status of Contractor as a Director Contractor (Spain) (JUN 1997)</HD>
                                <P>(a) “Direct Contractor,” as used in this clause, means an individual, company, or entity with whom an agency of the United States Department of Defense has executed a written agreement that allows duty-free import of equipment, materials, and supplies into Spain for the construction, development, maintenance, and operation of Spanish-American installations and facilities.</P>
                                <P>(b) The Contractor is hereby designated as a Direct Contractor under the provisions of Complementary Agreement 5, articles 11, 14, 15, 17, and 18 of the Agreement on Friendship, Defense and Cooperation between the United States Government and the Kingdom of Spain, dated July 2, 1982. The Agreement relates to contacts to be performed in whole or part in Spain, the provisions of which are hereby incorporated into and made a part of this contract by reference.</P>
                                <P>(c) The Contractor shall apply to the appropriate Spanish authorities for approval of status as a Direct Contractor in order to complete duty-free import of non-Spanish equipment, materials, and supplies represented as necessary for contract performance by the Contracting Officer. Orders for equipment, materials, and supplies placed prior to official notification of such approval shall be at the Contractor's own risk. The Contractor must submit its documentation in sufficient time to permit processing by the appropriate United States and Spanish Government agencies prior to the arrival of the equipment, material, or supplies in Spain. Seasonal variations in processing times are common, and the Contractor should program its projects accordingly. Any delay or expense arising directly or indirectly from this process shall not excuse untimely performance (except as expressly allowed in other provisions of this contract), constitute a direct or constructive change, or otherwise provide a basis for additional compensation or adjustment of any kind.</P>
                                <P>(d) To ensure that all duty-free imports are properly accounted for, exported, or disposed of, in accordance with Spanish law, the Contractor shall obtain a written bank letter of guaranty payable to the Treasurer of the United States, or such other authority as may be designated by the Contracting Officer, in the amount set forth in paragraph (g) of this clause, prior to effecting any duty-free imports for the performance of this contract.</P>
                                <P>(e) If the Contractor fails to obtain the required guaranty, the Contractor agrees that the Contracting Officer may withhold a portion of the contract payments in order to establish a fund in the amount set forth in paragraph (g) of this clause. The fund shall be used for the payment of import taxes in the event that the Contractor fails to properly account for, export, or dispose of equipment, materials, or supplies imported on a duty-free basis.</P>
                                <P>(f) The amount of the bank letter of guaranty or size of the fund required under paragraph (d) or (e) of this clause normally shall be 5 percent of the contract value. However, if the Contractor demonstrates to the Contracting Officer's satisfaction that the amount retained by the United States Government or guaranteed by the bank is excessive, the amount shall be reduced to an amount commensurate with contingent import tax and duty-free liability. This bank guaranty or fund shall not be released to the Contractor until the Spanish General Directorate of Customs verifies the accounting, export, or disposition of the equipment, material, or supplies imported on a duty-free basis.</P>
                                <P>
                                    (g) The amount required under paragraph (d), (e), or (f) of this clause is (
                                    <E T="03">Contracting Officer insert amount at time of contract award).</E>
                                </P>
                                <P>(h) The Contractor agrees to insert the provisions of this clause, including this paragraph (h), in all subcontracts.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[62 FR 34133, June 24, 1997, as amended at 63 FR 11548, Mar. 9, 1998]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.229-7005</SECTNO>
                            <SUBJECT>Tax exemptions (Spain).</SUBJECT>
                            <P>As prescribed in 229.402-70(e)(1), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Tax Exemptions (Spain) (MAR 2012)</HD>
                                <P>(a) As the Contractor represented in its offer, the contract price, including the prices in subcontracts awarded under this contract, does not include taxes from which the United States Government is exempt.</P>
                                <P>
                                    (b) In accordance with tax relief agreements between the United States Government and the Spanish Government, and because the incumbent contract arises from the activities of the United States Forces in 
                                    <PRTPAGE P="678"/>
                                    Spain, the contract will be exempt from the following excise, luxury, and transaction taxes:
                                </P>
                                <P>(1) Derechos de Aduana (Customs Duties).</P>
                                <P>(2) Impuesto de Compensacion a la Importacion (Compensation Tax on Imports).</P>
                                <P>(3) Transmissiones Patrionomiales (Property Transfer Tax).</P>
                                <P>(4) Impuesto Sobre el Lujo (Luxury Tax).</P>
                                <P>(5) Actos Juridocos Documentados (Legal Official Transactions).</P>
                                <P>(6) Impuesto Sobre el Trafico de Empresas (Business Trade Tax).</P>
                                <P>(7) Impuestos Especiales de Fabricacion (Special Products Tax).</P>
                                <P>(8) Impuesto Sobre el Petroleo y Derivados (Tax on Petroleum and its By-Products).</P>
                                <P>(9) Impuesto Sobre el Uso de Telefona (Telephone Tax).</P>
                                <P>(10) Impuesto General Sobre la Renta de Sociedades y demas Entidades Juridicas (General Corporation Income Tax).</P>
                                <P>(11) Impuesto Industrial (Industrial Tax).</P>
                                <P>(12) Impuesto de Rentas Sobre el Capital (Capital Gains Tax).</P>
                                <P>(13) Plus Vailia (Increase on Real Property).</P>
                                <P>(14) Contribucion Territorial Urbana (Metropolitan Real Estate Tax).</P>
                                <P>(15) Contribucion Territorial Rustica y Pecuaria (Farmland Real Estate Tax).</P>
                                <P>(16) Impuestos de la Diputacion (County Service Charges).</P>
                                <P>(17) Impuestos Municipal y Tasas Parafiscales (Municipal Tax and Charges).</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[62 FR 34133, June 24, 1997, as amended at 77 FR 19131, Mar. 30, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.229-7006</SECTNO>
                            <SUBJECT>Value Added Tax Exclusion (United Kingdom)</SUBJECT>
                            <P>As prescribed in 229.402-70(f), use the follow clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Value Added Tax Exclusion (United Kingdom) (DEC 2011)</HD>
                                <P>The supplies or services identified in this contract are to be delivered at a price exclusive of value added tax under arrangements between the appropriate United States authorities and Her Majesty's Revenue and Customs (HMRC) (Reference HMRC Notice 431, entitled “Relief from Customs Duty and/or Value Added Tax on United States Government Expenditures in the United Kingdom”). By executing this contract, the Contracting Officer certifies that these supplies or services are being purchased for United States Government official purposes only.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[76 FR 76320, Dec. 7, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.229-7007</SECTNO>
                            <SUBJECT>Verification of United States receipt of goods.</SUBJECT>
                            <P>As prescribed in 229.402-70(g), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Verification of United States Receipt of Goods (JUN 1997)</HD>
                                <P>The Contractor shall insert the following statement on all Material Inspection and Receiving Reports (DD Form 250 series) for Contracting Officer approval: “I certify that the items listed on this invoice have been received by the United States.”</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[62 FR 34134, June 24, 1997]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.229-7008</SECTNO>
                            <SUBJECT>Relief from Import Duty (United Kingdom)</SUBJECT>
                            <P>As prescribed in 229.402-70(h), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Relief from Import Duty (United Kingdom) (DEC 2011)</HD>
                                <P>Any import dutiable articles, components, or raw materials supplied to the United States Government under this contract shall be exclusive of any United Kingdom import duties. Any imported items supplied for which import duty already has been paid will be supplied at a price exclusive of the amount of import duty paid. The Contractor is advised to contact Her Majesty's Revenue and Customs (HMRC) to obtain a refund upon completion of the contract (Reference HMRC Notice No. 431, entitled “Relief from Customs Duty and/or Value Added Tax on United States Government Expenditures in the United Kingdom”).</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[76 FR 76320, Dec. 7, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.229-7009</SECTNO>
                            <SUBJECT>Relief from customs duty and value added tax on fuel (passenger vehicles) (United Kingdom).</SUBJECT>
                            <P>As prescribed in 229.402-70(i), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Relief from Customs Duty and Value Added Tax on Fuel (Passenger Vehicles) (United Kingdom) (JUN 1997)</HD>
                                <P>
                                    (a) Pursuant to an agreement between the United States Government and Her Majesty's (HM) Customs and Excise, fuels and lubricants used by passenger vehicles (except taxis) in the performance of this contract will be exempt from customs duty and value added tax. Therefore, the procedures outlined in HM Customs and Excise Notice No. 
                                    <PRTPAGE P="679"/>
                                    431B, August 1982, and any amendment thereto, shall be used to obtain relief from both customs duty and value added tax for fuel used under the contract. These procedures shall apply to both loaded and unloaded miles. The unit prices shall be based on the recoupment by the Contractor of customs duty in accordance with the following allowances:
                                </P>
                                <P>(1) Vehicles (except taxis) with a seating capacity of less than 29, one gallon for every 27 miles.</P>
                                <P>(2) Vehicles with a seating capacity of 29-53, one gallon for every 13 miles.</P>
                                <P>(3) Vehicles with a seating capacity of 54 or more, one gallon for every 10 miles.</P>
                                <P>(b) In the event the mileage of any route is increased or decreased within 10 percent, resulting in no change in route price, the customs duty shall be reclaimed from HM Customs and Excise on actual mileage performed.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[62 FR 34134, June 24, 1997]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.229-7010</SECTNO>
                            <SUBJECT>Relief from customs duty on fuel (United Kingdom).</SUBJECT>
                            <P>As prescribed in 229.402-70(j), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Relief from Customs Duty on Fuel (United Kingdom) (JUN 1997)</HD>
                                <P>(a) Pursuant to an agreement between the United States Government and Her Majesty's (HM) Customs and Excise, it is possible to obtain relief from customs duty on fuels and lubricants used in support of certain contracts. If vehicle fuels and lubricants are used in support of this contract, the Contractor shall seek relief from customs duty in accordance with HM Customs Notice No. 431, February 1973, entitled “Relief from Customs Duty and/or Value Added Tax on United States Government Expenditures in the United Kingdom.” Application should be sent to the Contractor's local Customs and Excise Office.</P>
                                <P>(b) Specific information should be included in the request for tax relief, such as the number of vehicles involved, types of vehicles, rating of vehicles, fuel consumption, estimated mileage per contract period, and any other information that will assist HM Customs and Excise in determining the amount of relief to be granted.</P>
                                <P>(c) Within 30 days after the award of this contract, the Contractor shall provide the Contracting Officer with evidence that an attempt to obtain such relief has been initiated. In the event the Contractor does not attempt to obtain relief within the time specified, the Contracting Officer may deduct from the contract price the amount of relief that would have been allowed if HM Customs and Excise had favorably considered the request for relief.</P>
                                <P>(d) The amount of any rebate granted by HM Customs and Excise shall be paid in full to the United States Government. Checks shall be made payable to the Treasurer of the United States and forwarded to the Administrative Contracting Officer.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[62 FR 34134, June 24, 1997]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.229-7011</SECTNO>
                            <SUBJECT>Reporting of Foreign Taxes—U.S. Assistance Programs.</SUBJECT>
                            <P>As prescribed in 229.170-4, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Reporting of Foreign Taxes—U.S. Assistance Programs (SEP 2005)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition. Commodities,</E>
                                     as used in this clause, means any materials, articles, supplies, goods, or equipment.
                                </P>
                                <P>(b) Commodities acquired under this contract shall be exempt from all value added taxes and customs duties imposed by the recipient country. This exemption is in addition to any other tax exemption provided through separate agreements or other means.</P>
                                <P>(c) The Contractor shall inform the foreign government of the tax exemption, as documented in the Letter of Offer and Acceptance, country-to-country agreement, or interagency agreement.</P>
                                <P>(d) If the foreign government or entity nevertheless imposes taxes, the Contractor shall promptly notify the Contracting Officer and shall provide documentation showing that the foreign government was apprised of the tax exemption in accordance with paragraph (c) of this clause.</P>
                                <P>(e) The Contractor shall insert the substance of this clause, including this paragraph (e), in all subcontracts for commodities that exceed $500.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[70 FR 57192, Sept. 30, 2005]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.229-7012</SECTNO>
                            <SUBJECT>Tax exemptions (Italy)—representation.</SUBJECT>
                            <P>As prescribed in 229.402-70(c)(2), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Tax Exemptions (Italy)—Representation (MAR 2012)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Exemptions.</E>
                                     The United States Government is exempt from payment of—
                                </P>
                                <P>
                                    (1) Imposta Valore Aggiunto (IVA) tax in accordance with Article 72 of the IVA implementing decree on all supplies and services sold to United States Military Commands in Italy; and
                                    <PRTPAGE P="680"/>
                                </P>
                                <P>(2) The other taxes specified in paragraph (c) of the clause DFARS 252.229-7003, Tax Exemptions (Italy).</P>
                                <P>
                                    (b) 
                                    <E T="03">Representation.</E>
                                     By submission of its offer, the offeror represents that the offered price, including the prices of subcontracts to be awarded under the contract, does not include the taxes identified herein, or any other taxes from which the United States Government is exempt.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[77 FR 19131, Mar. 30, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.229-7013</SECTNO>
                            <SUBJECT>Tax exemptions (Spain)—representation.</SUBJECT>
                            <P>As prescribed in 229.402-70(e)(2), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Tax Exemptions (Spain)—Representation (APR 2012)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Exemptions.</E>
                                     In accordance with tax relief agreements between the United States Government and the Spanish Government, and because the resultant contract arises from the activities of the United States Forces in Spain, the contract will be exempt from the excise, luxury, and transaction taxes listed in paragraph (b) of the clause DFARS 252.229-7005, Tax Exemptions (Spain).
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Representation.</E>
                                     By submission of its offer, the offeror represents that the offered price, including the prices of subcontracts to be awarded under the contract, does not include the taxes identified herein, or any other taxes from which the United States Government is exempt.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[77 FR 19131, Mar. 30, 2012, as amended at 77 FR 23632, Apr. 20, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.229-7014</SECTNO>
                            <SUBJECT>Full Exemption from Two-Percent Excise Tax on Certain Foreign Procurements.</SUBJECT>
                            <P>As prescribed in 229.402-70(k), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Full Exemption From Two-Percent Excise Tax on Certain Foreign Procurements (OCT 2022)</HD>
                                <P>(a) As the Contractor represented in its offer, any item, including any item delivered under subcontract; any service; or any combination thereof delivered under this contract is fully exempt from the 2-percent excise tax withholding imposed by 26 U.S.C. 5000C and implemented by Federal Acquisition Regulation (FAR) 52.229-12, Tax on Certain Foreign Procurements.</P>
                                <P>(b) If the full exemption no longer applies due to a change in circumstances during the performance of the contract, causing the Contractor to become subject to the withholding for the 2-percent excise tax as imposed by 26 U.S.C. 5000C, then the Contractor shall immediately comply with the notification and billing requirements of FAR clause 52.229-12.</P>
                            </EXTRACT>
                            <HD SOURCE="HD2">(End of clause)</HD>
                            <CITA>[87 FR 65517, Oct. 28, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.231-7000</SECTNO>
                            <SUBJECT>Supplemental cost principles.</SUBJECT>
                            <P>As prescribed in 231.100-70, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Supplemental Cost Principles (DEC 1991)</HD>
                                <P>When the allowability of costs under this contract is determined in accordance with part 31 of the Federal Acquisition Regulation (FAR), allowability shall also be determined in accordance with part 231 of the Defense FAR Supplement, in effect on the date of this contract.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.232-7000</SECTNO>
                            <SUBJECT>Advance payment pool.</SUBJECT>
                            <P>As prescribed in 232.412-70(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Advance Payment Pool (APR 2020)</HD>
                                <P>(a) Notwithstanding any other provision of this contract, advance payments will be made for contract performance in accordance with the Determinations, Findings, and Authorization for Advance payment dated ______________.</P>
                                <P>
                                    (b) Payments made in accordance with this clause shall be governed by the terms and conditions of the Advance Payment Pool Agreement between the United States of America and 
                                    <E T="03">[insert the name of the Contractor]”</E>
                                    . The Agreement is incorporated in the contract by reference.
                                </P>
                            </EXTRACT>
                            <P>(c) When a letter of credit has not been issued to the Contractor in conjunction with the contract, payment will be by a dual payee Treasury check made payable to the Contractor or the disbursing office in the Advance Payment Pool Agreement and will be forwarded to that disbursing office for appropriate disposition.</P>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 85 FR 19700, Apr. 8, 2020]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="681"/>
                            <SECTNO>252.232-7001</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.232-7002</SECTNO>
                            <SUBJECT>Progress Payments for Foreign Military Sales Acquisitions.</SUBJECT>
                            <P>As prescribed in 232.502-4-70(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Progress Payments for Foreign Military Sales Acquisitions (MAY 2023)</HD>
                                <P>If this contract includes foreign military sales (FMS) requirements, the Contractor shall—</P>
                                <P>(a) Submit separate progress payment requests for the FMS and U.S. line items in the contract;</P>
                                <P>(b) Submit a supporting schedule showing the amount of each request distributed to each country's requirements;</P>
                                <P>
                                    (c) Identify in each progress payment request the contract requirements to which it applies (
                                    <E T="03">i.e.,</E>
                                     FMS or U.S.);
                                </P>
                                <P>(d) Calculate each request on the basis of the prices, costs (including costs to complete), subcontract financing, and progress payment liquidations of the contract requirements to which it applies; and</P>
                                <P>(e) Distribute costs among the countries in a manner acceptable to the Administrative Contracting Officer.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[88 FR 33833, May 25, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.232-7003</SECTNO>
                            <SUBJECT>Electronic Submission of Payment Requests and Receiving Reports.</SUBJECT>
                            <P>As prescribed in 232.7004(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Electronic Submission of Payment Requests and Receiving Reports (DEC 2018)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Contract financing payment</E>
                                     means an authorized Government disbursement of monies to a contractor prior to acceptance of supplies or services by the Government.
                                </P>
                                <P>(1) Contract financing payments include—</P>
                                <P>(i) Advance payments;</P>
                                <P>(ii) Performance-based payments;</P>
                                <P>(iii) Commercial advance and interim payments;</P>
                                <P>(iv) Progress payments based on cost under the clause at Federal Acquisition Regulation (FAR) 52.232-16, Progress Payments;</P>
                                <P>(v) Progress payments based on a percentage or stage of completion (see FAR 32.102(e)), except those made under the clause at FAR 52.232-5, Payments Under Fixed-Price Construction Contracts, or the clause at FAR 52.232-10, Payments Under Fixed-Price Architect-Engineer Contracts; and</P>
                                <P>(vi) Interim payments under a cost reimbursement contract, except for a cost reimbursement contract for services when Alternate I of the clause at FAR 52.232-25, Prompt Payment, is used.</P>
                                <P>(2) Contract financing payments do not include—</P>
                                <P>(i) Invoice payments;</P>
                                <P>(ii) Payments for partial deliveries; or</P>
                                <P>(iii) Lease and rental payments.</P>
                                <P>
                                    <E T="03">Electronic form</E>
                                     means any automated system that transmits information electronically from the initiating system to affected systems.
                                </P>
                                <P>
                                    <E T="03">Invoice payment</E>
                                     means a Government disbursement of monies to a contractor under a contract or other authorization for supplies or services accepted by the Government.
                                </P>
                                <P>(1) Invoice payments include—</P>
                                <P>(i) Payments for partial deliveries that have been accepted by the Government;</P>
                                <P>(ii) Final cost or fee payments where amounts owed have been settled between the Government and the contractor;</P>
                                <P>(iii) For purposes of subpart 32.9 only, all payments made under the clause at 52.232-5, Payments Under Fixed-Price Construction Contracts, and the clause at 52.232-10, Payments Under Fixed-Price Architect-Engineer Contracts; and</P>
                                <P>(iv) Interim payments under a cost-reimbursement contract for services when Alternate I of the clause at 52.232-25, Prompt Payment, is used.</P>
                                <P>(2) Invoice payments do not include contract financing payments.</P>
                                <P>
                                    <E T="03">Payment request</E>
                                     means any request for contract financing payment or invoice payment submitted by the Contractor under this contract or task or delivery order.
                                </P>
                                <P>
                                    <E T="03">Receiving report</E>
                                     means the data prepared in the manner and to the extent required by Appendix F, Material Inspection and Receiving Report, of the Defense Federal Acquisition Regulation Supplement.
                                </P>
                                <P>(b) Except as provided in paragraph (d) of this clause, the Contractor shall submit payment requests and receiving reports in electronic form using Wide Area WorkFlow (WAWF). The Contractor shall prepare and furnish to the Government a receiving report at the time of each delivery of supplies or services under this contract or task or delivery order.</P>
                                <P>(c) Submit payment requests and receiving reports to WAWF in one of the following electronic formats:</P>
                                <P>(1) Electronic Data Interchange.</P>
                                <P>(2) Secure File Transfer Protocol.</P>
                                <P>(3) Direct input through the WAWF website.</P>
                                <P>(d) The Contractor may submit a payment request and receiving report using methods other than WAWF only when—</P>
                                <P>
                                    (1) The Contractor has requested permission in writing to do so, and the Contracting Officer has provided instructions for a temporary alternative method of submission of payment requests and receiving reports in 
                                    <PRTPAGE P="682"/>
                                    the contract administration data section of this contract or task or delivery order;
                                </P>
                                <P>
                                    (2) DoD makes payment for commercial transportation services provided under a Government rate tender or a contract for transportation services using a DoD-approved electronic third party payment system or other exempted vendor payment/invoicing system (
                                    <E T="03">e.g.,</E>
                                     PowerTrack, Transportation Financial Management System, and Cargo and Billing System);
                                </P>
                                <P>(3) DoD makes payment on a contract or task or delivery order for rendered health care services using the TRICARE Encounter Data System; or</P>
                                <P>(4) The Governmentwide commercial purchase card is used as the method of payment, in which case submission of only the receiving report in WAWF is required.</P>
                                <P>
                                    (e) Information regarding WAWF is available at 
                                    <E T="03">https://wawf.eb.mil/.</E>
                                </P>
                                <P>(f) In addition to the requirements of this clause, the Contractor shall meet the requirements of the appropriate payment clauses in this contract when submitting payment requests.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[83 FR 66064, Dec. 21, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.232-7004</SECTNO>
                            <SUBJECT>DoD Progress Payment Rates.</SUBJECT>
                            <P>As prescribed in 232.502-4-70(b), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">DoD Progress Payment Rates (OCT 2014)</HD>
                                <P>If the Contractor is a small business concern, the Progress Payments clause of this contract is modified to change each mention of the progress payment rate and liquidations rate (excepting paragraph (k), Limitations on Undefinitized Contract Actions) to 90 percent. </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[79 FR 61582, Oct. 14, 2014]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.232-7005</SECTNO>
                            <SUBJECT>Reimbursement of Subcontractor Advance Payments—DoD Mentor-Protégé Program.</SUBJECT>
                            <P>As prescribed in 232.412-70(b), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Reimbursement of Subcontractor Advance Payments—DoD Mentor-Protégé Program (MAR 2024)</HD>
                                <P>(a) The Government will reimburse the Contractor for any advance payments made by the Contractor, as a mentor firm, to a protégé firm, pursuant to an approved mentor-protégé agreement, provided—</P>
                                <P>(1) The Contractor's subcontract with the protégé firm includes a provision substantially the same as FAR 52.232-12, Advance Payments;</P>
                                <P>(2) The Contractor has administered the advance payments in accordance with the policies of FAR subpart 32.4; and</P>
                                <P>(3) The Contractor agrees that any financial loss resulting from the failure or inability of the protégé firm to repay any unliquidated advance payments is the sole financial responsibility of the Contractor.</P>
                                <P>(b) For a fixed price type contract, advance payments made to a protégé firm shall be paid and administered as if there were 100 percent progress payments. The Contractor shall include as a separate attachment with each Standard Form (SF) 1443, Contractor's Request for Progress Payment, a request for reimbursement of advance payments made to a protégé firm. The attachment shall provide a separate calculation of lines 14a through 14e of SF 1443 for each protégé, reflecting the status of advance payments made to that protégé.</P>
                                <P>(c) For cost reimbursable, contracts, reimbursement of advance payments shall be made via public voucher. The Contractor shall show the amounts of advance payments made to each protégé on the public voucher, in the form and detail directed by the cognizant contracting officer or contract auditor.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 67221, Dec. 30, 1991, as amended at 57 FR 53602, Nov. 12, 1992; 66 FR 47109, Sept. 11, 2001; 85 FR 19700, Apr. 8, 2020; 89 FR 20876, Mar. 26, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.232-7006</SECTNO>
                            <SUBJECT>Wide Area WorkFlow Payment Instructions.</SUBJECT>
                            <P>As prescribed in 232.7004(b), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Wide Area Workflow Payment Instructions (JAN 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Department of Defense Activity Address Code (DoDAAC)</E>
                                     is a six position code that uniquely identifies a unit, activity, or organization.
                                </P>
                                <P>
                                    <E T="03">Document type</E>
                                     means the type of payment request or receiving report available for creation in Wide Area WorkFlow (WAWF).
                                </P>
                                <P>
                                    <E T="03">Local processing office (LPO)</E>
                                     is the office responsible for payment certification when payment certification is done external to the entitlement system.
                                </P>
                                <P>
                                    <E T="03">Payment request</E>
                                     and 
                                    <E T="03">receiving report</E>
                                     are defined in the clause at 252.232-7003, Electronic Submission of Payment Requests and Receiving Reports.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Electronic invoicing.</E>
                                     The WAWF system provides the method to electronically process vendor payment requests and receiving reports, as authorized by Defense Federal Acquisition Regulation System (DFARS) 
                                    <PRTPAGE P="683"/>
                                    252.232-7003, Electronic Submission of Payment Requests and Receiving Reports.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">WAWF access.</E>
                                     To access WAWF, the Contractor shall—
                                </P>
                                <P>
                                    (1) Have a designated electronic business point of contact in the System for Award Management at 
                                    <E T="03">https://www.sam.gov</E>
                                     and
                                </P>
                                <P>
                                    (2) Be registered to use WAWF at 
                                    <E T="03">https://wawf.eb.mil/</E>
                                     following the step-by-step procedures for self-registration available at this Web site.
                                </P>
                                <P>
                                    (d) 
                                    <E T="03">WAWF training.</E>
                                     The Contractor should follow the training instructions of the WAWF Web-Based Training Course and use the Practice Training Site before submitting payment requests through WAWF. Both can be accessed by selecting the “Web Based Training” link on the WAWF home page at 
                                    <E T="03">https://wawf.eb.mil/.</E>
                                </P>
                                <P>
                                    (e) 
                                    <E T="03">WAWF methods of document submission.</E>
                                     Document submissions may be via Web entry, Electronic Data Interchange, or File Transfer Protocol.
                                </P>
                                <P>
                                    (f) 
                                    <E T="03">WAWF payment instructions.</E>
                                     The Contractor shall use the following information when submitting payment requests and receiving reports in WAWF for this contract or task or delivery order:
                                </P>
                                <P>
                                    (1) 
                                    <E T="03">Document type.</E>
                                     The Contractor shall submit payment requests using the following document type(s):
                                </P>
                                <P>(i) For cost-type line items, including labor-hour or time-and-materials, submit a cost voucher.</P>
                                <P>(ii) For fixed price line items—</P>
                                <P>(A) That require shipment of a deliverable, submit the invoice and receiving report specified by the Contracting Officer.</P>
                                <FP>(Contracting Officer: Insert applicable invoice and receiving report document type(s) for fixed price line items that require shipment of a deliverable.)</FP>
                                <P>(B) For services that do not require shipment of a deliverable, submit either the Invoice 2in1, which meets the requirements for the invoice and receiving report, or the applicable invoice and receiving report, as specified by the Contracting Officer.</P>
                                <FP>(Contracting Officer: Insert either “Invoice 2in1” or the applicable invoice and receiving report document type(s) for fixed price line items for services.)</FP>
                                <P>(iii) For customary progress payments based on costs incurred, submit a progress payment request.</P>
                                <P>(iv) For performance based payments, submit a performance based payment request.</P>
                                <P>(v) For commercial financing, submit a commercial financing request.</P>
                                <P>(2) Fast Pay requests are only permitted when Federal Acquisition Regulation (FAR) 52.213-1 is included in the contract.</P>
                                <FP>[Note: The Contractor may use a WAWF “combo” document type to create some combinations of invoice and receiving report in one step.]</FP>
                                <P>
                                    (3) 
                                    <E T="03">Document routing.</E>
                                     The Contractor shall use the information in the Routing Data Table below only to fill in applicable fields in WAWF when creating payment requests and receiving reports in the system.
                                </P>
                                <GPOTABLE COLS="2" OPTS="L2" CDEF="s25,xs48">
                                    <TTITLE>Routing Data Table *</TTITLE>
                                    <BOXHD>
                                        <CHED H="1">Field name in WAWF</CHED>
                                        <CHED H="1">
                                            Data to be
                                            <LI>entered in</LI>
                                            <LI>WAWF</LI>
                                        </CHED>
                                    </BOXHD>
                                    <ROW>
                                        <ENT I="01">Pay Official DoDAAC</ENT>
                                    </ROW>
                                    <ROW>
                                        <ENT I="01">Issue By DoDAAC</ENT>
                                    </ROW>
                                    <ROW>
                                        <ENT I="01">Admin DoDAAC **</ENT>
                                    </ROW>
                                    <ROW>
                                        <ENT I="01">Inspect By DoDAAC</ENT>
                                    </ROW>
                                    <ROW>
                                        <ENT I="01">Ship To Code</ENT>
                                    </ROW>
                                    <ROW>
                                        <ENT I="01">Ship From Code</ENT>
                                    </ROW>
                                    <ROW>
                                        <ENT I="01">Mark For Code</ENT>
                                    </ROW>
                                    <ROW>
                                        <ENT I="01">Service Approver (DoDAAC)</ENT>
                                    </ROW>
                                    <ROW>
                                        <ENT I="01">Service Acceptor (DoDAAC)</ENT>
                                    </ROW>
                                    <ROW>
                                        <ENT I="01">Accept at Other DoDAAC</ENT>
                                    </ROW>
                                    <ROW>
                                        <ENT I="01">LPO DoDAAC</ENT>
                                    </ROW>
                                    <ROW>
                                        <ENT I="01">DCAA Auditor DoDAAC</ENT>
                                    </ROW>
                                    <ROW>
                                        <ENT I="01">Other DoDAAC(s)</ENT>
                                    </ROW>
                                    <TNOTE>(* Contracting Officer: Insert applicable DoDAAC information. If multiple ship to/acceptance locations apply, insert “See Schedule” or “Not applicable.”)</TNOTE>
                                    <TNOTE>(** Contracting Officer: If the contract provides for progress payments or performance-based payments, insert the DoDAAC for the contract administration office assigned the functions under FAR 42.302(a)(13).)</TNOTE>
                                </GPOTABLE>
                                <P>
                                    (4) 
                                    <E T="03">Payment request.</E>
                                     The Contractor shall ensure a payment request includes documentation appropriate to the type of payment request in accordance with the payment clause, contract financing clause, or Federal Acquisition Regulation 52.216-7, Allowable Cost and Payment, as applicable.
                                </P>
                                <P>
                                    (5) 
                                    <E T="03">Receiving report.</E>
                                     The Contractor shall ensure a receiving report meets the requirements of DFARS Appendix F.
                                </P>
                                <P>
                                    (g) 
                                    <E T="03">WAWF point of contact.</E>
                                     (1) The Contractor may obtain clarification regarding invoicing in WAWF from the following contracting activity's WAWF point of contact.
                                </P>
                                <FP SOURCE="FP-DASH"/>
                                <FP>
                                    (
                                    <E T="03">Contracting Officer: Insert applicable information or “Not applicable.”</E>
                                    )
                                </FP>
                                <P>(2) Contact the WAWF helpdesk at 866-618-5988, if assistance is needed.</P>
                            </EXTRACT>
                            <CITA>[77 FR 38734, June 29, 2012, as amended at 78 FR 28758, May 16, 2013; 78 FR 30232, May 22, 2013; 83 FR 66064, Dec. 21, 2018; 88 FR 6595, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.232-7007</SECTNO>
                            <SUBJECT>Limitation of Government's obligation.</SUBJECT>
                            <P>As prescribed in 232.706-70, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Limitation of Government's Obligation (APR 2014)</HD>
                                <P>
                                    (a) Contract line item(s) 
                                    <E T="03">[Contracting Officer insert after negotiations]</E>
                                     is/are incrementally funded. For this/these item(s), the sum 
                                    <PRTPAGE P="684"/>
                                    of $____ 
                                    <E T="03">[Contracting Officer insert after negotiations]</E>
                                     of the total price is presently available for payment and allotted to this contract. An allotment schedule is set forth in paragraph (j) of this clause.
                                </P>
                                <P>(b) For item(s) identified in paragraph (a) of this clause, the Contractor agrees to perform up to the point at which the total amount payable by the Government, including reimbursement in the event of termination of those item(s) for the Government's convenience, approximates the total amount currently allotted to the contract. The Contractor is not authorized to continue work on those item(s) beyond that point. The Government will not be obligated in any event to reimburse the Contractor in excess of the amount allotted to the contract for those item(s) regardless of anything to the contrary in the clause entitled “Termination for Convenience of the Government.” As used in this clause, the total amount payable by the Government in the event of termination of applicable contract line item(s) for convenience includes costs, profit, and estimated termination settlement costs for those items(s).</P>
                                <P>(c) Notwithstanding the dates specified in the allotment schedule in paragraph (j) of this clause, the Contractor will notify the Contracting Officer in writing at least ninety days prior to the date when, in the Contractor's best judgment, the work will reach the point at which the total amount payable by the Government, including any cost for termination for convenience, will approximate 85 percent of the total amount then allotted to the contract for performance of the applicable item(s). The notification will state (1) the estimated date when that point will be reached and (2) an estimate of additional funding, if any, needed to continue performance of applicable line items up to the next scheduled date for allotment of funds identified in paragraph (j) of this clause, or to a mutually agreed upon substitute date. The notification will also advise the Contracting Officer of the estimated amount of additional funds that will be required for the timely performance of the item(s) funded pursuant to this clause, for a subsequent period as may be specified in the allotment schedule in paragraph (j) of this clause, or otherwise agreed to by the parties. If after such notification additional funds are not allotted by the date identified in the Contractor's notification, or by an agreed substitute date, the Contracting Officer will terminate any item(s) for which additional funds have not been allotted, pursuant to the clause of this contract entitled “Termination for Convenience of the Government.”</P>
                                <P>(d) When additional funds are allotted for continued performance of the contract line item(s) identified in paragraph (a) of this clause, the parties will agree as to the period of contract performance which will be covered by the funds. The provisions of paragraph (b) through (d) of this clause will apply in like manner to the additional allotted funds and agreed substitute date, and the contract will be modified accordingly.</P>
                                <P>(e) If, solely by reason of failure of the Government to allot additional funds, by the dates indicated below, in amounts sufficient for timely performance of the contract line item(s) identified in paragraph (a) of this clause, the Contractor incurs additional costs or is delayed in the performance of the work under this contract and if additional funds are allotted, an equitable adjustment will be made in the price or prices (including appropriate target, billing, and ceiling prices where applicable) of the item(s), or in the time of delivery, or both. Failure to agree to any such equitable adjustment hereunder will be a dispute concerning a question of fact within the meaning of the clause entitled “Disputes.”</P>
                                <P>(f) The Government may at any time prior to termination allot additional funds for the performance of the contract line item(s) identified in paragraph (a) of this clause.</P>
                                <P>(g) The termination provisions of this clause do not limit the rights of the Government under the clause entitled “Default.” The provisions of this clause are limited to the work and allotment of funds for the contract line item(s) set forth in paragraph (a) of this clause. This clause no longer applies once the contract is fully funded except with regard to the rights or obligations of the parties concerning equitable adjustments negotiated under paragraphs (d) or (e) of this clause.</P>
                                <P>(h) Nothing in this clause affects the right of the Government to terminate this contract pursuant to the clause of this contract entitled “Termination for Convenience of the Government.”</P>
                                <P>(i) Nothing in this clause shall be construed as authorization of voluntary services whose acceptance is otherwise prohibited under 31 U.S.C. 1342.</P>
                                <P>(j) The parties contemplate that the Government will allot funds to this contract in accordance with the following schedule:</P>
                                <P>On execution of contract $____</P>
                                <P>(month) (day), (year) $____</P>
                                <P>(month) (day), (year) $____</P>
                                <P>(month) (day), (year) $____</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[58 FR 46093, Sept. 1, 1993, as amended at 71 FR 18673, Apr. 12, 2006; 71 FR 27644, May 12, 2006; 79 FR 22042, Apr. 21, 2014; 86 FR 59871, Oct. 29, 2021]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.232-7008</SECTNO>
                            <SUBJECT>Assignment of claims (overseas).</SUBJECT>
                            <P>As prescribed in 232.806(a)(1), use the following clause:</P>
                            <EXTRACT>
                                <PRTPAGE P="685"/>
                                <HD SOURCE="HD1">Assignment of Claims (Overseas) (JUN 1997)</HD>
                                <P>(a) No claims for monies due, or to become due, shall be assigned by the Contractor unless—</P>
                                <P>(1) Approved in writing by the Contracting Officer;</P>
                                <P>(2) Made in accordance with the laws and regulations of the United States of America; and</P>
                                <P>(3) Permitted by the laws and regulations of the Contractor's country.</P>
                                <P>(b) In no event shall copies of this contract of any plans, specifications, or other similar documents relating to work under this contract, if marked “Top Secret,” “Secret,” or “Confidential” be furnished to any assignee of any claim arising under this contract or to any other person not entitled to receive such documents. However, a copy of any part or all of this contract so marked may be furnished, or any information contained herein may be disclosed, to such assignee upon the Contracting Officer's prior written authorization.</P>
                                <P>(c) Any assignment under this contract shall cover all amounts payable under this contract and not already paid, and shall not be made to more than one party, except that any such assignment may be made to one party as agent or trustee for two or more parties participating in such financing. On each invoice or voucher submitted for payment under this contract to which any assignment applies, and for which direct payment thereof is to be made to an assignee, the Contractor shall—</P>
                                <P>(1) Identify the assignee by name and complete address; and</P>
                                <P>(2) Acknowledge the validity of the assignment and the right of the named assignee to receive payment in the amount invoiced or vouchered.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[62 FR 34134, June 24, 1997]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.232-7009</SECTNO>
                            <SUBJECT>Mandatory payment by Governmentwide commercial purchase card.</SUBJECT>
                            <P>As prescribed in 232.1110, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Mandatory Payment by Governmentwide Commercial Purchase Card (MAY 2018)</HD>
                                <P>The Contractor agrees to accept the Governmentwide commercial purchase card as the method of payment for orders or calls valued at or below the micro-purchase threshold in part 202 of the Defense Federal Acquisition Regulation Supplement, under this contract or agreement.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[65 FR 46626, July 31, 2000, as amended at 71 FR 75893, Dec. 19, 2006; 83 FR 24896, May 30, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.232-7010</SECTNO>
                            <SUBJECT>Levies on Contract Payments.</SUBJECT>
                            <P>As prescribed in 232.7102, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Levies on Contract Payments (DEC 2006)</HD>
                                <P>(a) 26 U.S.C. 6331(h) authorizes the Internal Revenue Service (IRS) to continuously levy up to 100 percent of contract payments, up to the amount of tax debt.</P>
                                <P>(b) When a levy is imposed on a payment under this contract and the Contractor believes that the levy may result in an inability to perform the contract, the Contractor shall promptly notify the Procuring Contracting Officer in writing, with a copy to the Administrative Contracting Officer, and shall provide—</P>
                                <P>(1) The total dollar amount of the levy;</P>
                                <P>(2) A statement that the Contractor believes that the levy may result in an inability to perform the contract, including rationale and adequate supporting documentation; and</P>
                                <P>(3) Advice as to whether the inability to perform may adversely affect national security, including rationale and adequate supporting documentation.</P>
                                <P>(c) DoD shall promptly review the Contractor's assessment, and the Procuring Contracting Officer shall provide a written notification to the Contractor including—</P>
                                <P>(1) A statement as to whether DoD agrees that the levy may result in an inability to perform the contract; and</P>
                                <P>(2)(i) If the levy may result in an inability to perform the contract and the lack of performance will adversely affect national security, the total amount of the monies collected that should be returned to the Contractor; or</P>
                                <P>(ii) If the levy may result in an inability to perform the contract but will not impact national security, a recommendation that the Contractor promptly notify the IRS to attempt to resolve the tax situation.</P>
                                <P>(d) Any DoD determination under this clause is not subject to appeal under the Contract Disputes Act.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[70 FR 52032, Sept. 1, 2005, as amended at 71 FR 69492, Dec. 1, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="686"/>
                            <SECTNO>252.232-7011</SECTNO>
                            <SUBJECT>Payments in Support of Emergencies and Contingency Operations.</SUBJECT>
                            <P>As prescribed in section 232.908, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Payments in Support of Emergencies and Contingency Operations (MAY 2013)</HD>
                                <P>(a) Definitions of pertinent terms are set forth in sections 2.101, 32.001, and 32.902 of the Federal Acquisition Regulation.</P>
                                <P>(b) Notwithstanding any other payment clause in this contract, the Government will make invoice payments under the terms and conditions specified in this clause. The Government considers payment as being made on the day a check is dated or the date of an electronic funds transfer</P>
                                <P>
                                    (c) 
                                    <E T="03">Invoice payments</E>
                                    —(1) 
                                    <E T="03">Due date.</E>
                                     (i) Payment will be made as soon as possible once a proper invoice is received and matched with the contract and the receiving/acceptance report.
                                </P>
                                <P>
                                    (ii) If the contract does not require submission of an invoice for payment (
                                    <E T="03">e.g.,</E>
                                     periodic lease payments), the due date will be as specified in the contract.
                                </P>
                                <P>
                                    (2) 
                                    <E T="03">Contractor's invoice.</E>
                                     The Contractor shall prepare and submit invoices to the designated billing office specified in the contract. A proper invoice should include the items listed in paragraphs (c)(2)(i) through (c)(2)(x) of this clause.
                                </P>
                                <P>(i) Name and address of the Contractor.</P>
                                <P>(ii) Invoice date and invoice number. (The Contractor should date invoices as close as possible to the date of the mailing or transmission.)</P>
                                <P>(iii) Contract number or other authorization for supplies delivered or services performed (including order number and contract line item number).</P>
                                <P>(iv) Description, quantity, unit of measure, unit price, and extended price of supplies delivered or services performed.</P>
                                <P>
                                    (v) Shipping and payment terms (
                                    <E T="03">e.g.,</E>
                                     shipment number and date of shipment, discount for prompt payment terms). Bill of lading number and weight of shipment will be shown for shipments on Government bills of lading.
                                </P>
                                <P>(vi) Name and address of Contractor official to whom payment is to be sent (must be the same as that in the contract or in a proper notice of assignment).</P>
                                <P>(vii) Name (where practicable), title, phone number, and mailing address of person to notify in the event of a defective invoice.</P>
                                <P>(viii) Taxpayer Identification Number (when required). The taxpayer identification number is required for all payees subject to the U.S. Internal Revenue Code.</P>
                                <P>(ix) Electronic funds transfer banking information.</P>
                                <P>(A) The Contractor shall include electronic funds transfer banking information on the invoice only if required elsewhere in this contract.</P>
                                <P>(B) If electronic funds transfer banking information is not required to be on the invoice, in order for the invoice to be a proper invoice, the Contractor shall have submitted correct electronic funds transfer banking information in accordance with the applicable solicitation provision (e.g., FAR 52.232-38, Submission of Electronic Funds Transfer Information with Offer), contract clause (e.g., FAR 52.232-33, Payment by Electronic Funds Transfer—System for Award Management, or FAR 52.232-34, Payment by Electronic Funds Transfer—Other Than System for Award Management), or applicable agency procedures.</P>
                                <P>(C) Electronic funds transfer banking information is not required if the Government waived the requirement to pay by electronic funds transfer.</P>
                                <P>
                                    (x) Any other information or documentation required by the contract (
                                    <E T="03">e.g.,</E>
                                     evidence of shipment).
                                </P>
                                <P>
                                    (3) 
                                    <E T="03">Discounts for prompt payment.</E>
                                     The designated payment office will take cost-effective discounts if the payment is made within the discount terms of the contract.
                                </P>
                                <P>
                                    (4) 
                                    <E T="03">Contract financing payment.</E>
                                     If this contract provides for contract financing, the Government will make contract financing payments in accordance with the applicable contract financing clause.
                                </P>
                                <P>
                                    (5) 
                                    <E T="03">Overpayments.</E>
                                     If the Contractor becomes aware of a duplicate contract financing or invoice payment or that the Government has otherwise overpaid on a contract financing or invoice payment, the Contractor shall—
                                </P>
                                <P>(i) Remit the overpayment amount to the payment office cited in the contract along with a description of the overpayment, including the—</P>
                                <P>
                                    (A) Circumstances of the overpayment (
                                    <E T="03">e.g.,</E>
                                     duplicate payment, erroneous payment, liquidation errors, date(s) of overpayment);
                                </P>
                                <P>(B) Affected contract number and delivery order number, if applicable;</P>
                                <P>(C) Affected contract line item or subline item, if applicable; and</P>
                                <P>(D) Contractor point of contact; and</P>
                                <P>(ii) Provide a copy of the remittance and supporting documentation to the Contracting Officer.</P>
                                <P>(d) This clause is applicable until otherwise notified by the Contracting Officer. Upon notification by issuance of a contract modification, the appropriate FAR Prompt Payment clause in the contract becomes applicable.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[75 FR 40714, July 13, 2010, as amended at 78 FR 28758, May 16, 2013; 78 FR 30232, May 22, 2013]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="687"/>
                            <SECTNO>252.232-7012</SECTNO>
                            <SUBJECT>Performance-Based Payments—Whole-Contract Basis.</SUBJECT>
                            <P>As prescribed in 232.1005-70(a)(1), use the following clause: PERFORMANCE-BASED PAYMENTS—WHOLE-CONTRACT BASIS (DEC 2022)</P>
                            <EXTRACT>
                                <P>(a) Performance-based payments shall form the basis for the contract financing payments provided under this contract, and shall apply to the whole contract. The performance-based payments schedule (Contract Attachment ______) describes the basis for payment, to include identification of the individual payment events, evidence of completion, and amount of payment due upon completion of each event.</P>
                                <P>(b) In accordance with 10 U.S.C. 3802(c), the Contractor's financial statements shall be in compliance with Generally Accepted Accounting Principles in order to receive performance-based payments.</P>
                                <P>(c)(1) The Contractor shall, in addition to providing the information required by FAR 52.232-32, submit information for all payment requests using the following format:</P>
                                <GPH SPAN="2" DEEP="275">
                                    <GID>ER08AP20.002</GID>
                                </GPH>
                                <P>(2) Incurred cost is determined by the Contractor's accounting books and records, to which the Contractor shall provide access upon request of the Contracting Officer. An acceptable accounting system in accordance with DFARS 252.242-7006 is not required for reporting of incurred costs under this clause. If the Contractor's accounting system is not capable of tracking costs on a job order basis, the Contractor shall provide a realistic approximation of the allocation of incurred costs attributable to this contract in accordance with the Contractor's accounting system. FAR 52.232-32(m) does not require certification of incurred costs.</P>
                                <P>
                                    (d) 
                                    <E T="03">Security for financing.</E>
                                     (1) Title to the property described in paragraph (f) of the clause at FAR 52.232-32, Performance-Based Payments, is the preferred security for receipt of performance-based payments.
                                </P>
                                <P>
                                    (2)(i) If the Contractor's accounting system is not capable of identifying and tracking through the build cycle the property that is allocable and properly chargeable to this contract, the Contracting Officer may consider acceptance of one or a combination of 
                                    <PRTPAGE P="688"/>
                                    the following alternative forms of security sufficient to constitute adequate security for the performance-based payments and so specify in the contract, consistent with FAR 32.202-4:
                                </P>
                                <P>(A) A paramount lien on assets.</P>
                                <P>(B) An irrevocable letter of credit from a federally insured financial institution.</P>
                                <P>(C) A bond from a surety, acceptable in accordance with FAR part 28.</P>
                                <P>(D) A guarantee of repayment from a person or corporation of demonstrated liquid net worth, connected by significant ownership interest to the Contractor.</P>
                                <P>(E) Title to identified Contractor assets of adequate worth.</P>
                                <P>(ii) Paragraph (f) of the clause at FAR 52.232-32 does not apply to the extent that the Contractor and the Contracting Officer agree on alternative forms of security. In the event the Contractor fails to provide adequate security, as required in this contract, no financing payment will be made under this contract. Upon receipt of adequate security, financing payments will be made, including all previous payments to which the Contractor is entitled, in accordance with the terms of the provisions for contract financing. If at any time the Contracting Officer determines that the security provided by the Contractor is insufficient, the Contractor shall promptly provide such additional security as the Contracting Officer determines necessary. In the event the Contractor fails to provide such additional security, the Contracting Officer may collect or liquidate such security that has been provided and suspend further payments to the Contractor; and the Contractor shall repay to the Government the amount of unliquidated financing payments as the Contracting Officer at his sole discretion deems repayable.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[79 FR 17936, Mar. 31, 2014, as amended at 85 FR 19688, Apr. 8, 2020; 87 FR 76998, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.232-7013</SECTNO>
                            <SUBJECT>Performance-Based Payments—Deliverable-Item Basis.</SUBJECT>
                            <P>As prescribed in 232.1005-70(a)(2), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Performance-Based Payments—Deliverable-Item Basis (DEC 2022)</HD>
                                <P>(a) Performance-based payments shall form the basis for the contract financing payments provided under this contract and shall apply to Contract Line Item Number(s) (CLIN(s)) [Contracting Officer insert applicable CLIN(s)]. The performance-based payments schedule (Contract Attachment ____) describes the basis for payment, to include identification of the individual payment events, CLINs to which each event applies, evidence of completion, and amount of payment due upon completion of each event.</P>
                                <P>(b) In accordance with 10 U.S.C. 3802(c), the Contractor's financial statements shall be in compliance with Generally Accepted Accounting Principles in order to receive performance-based payments.</P>
                                <P>(c)(1) The Contractor shall, in addition to providing the information required by FAR 52.232-32, submit information for all payment requests using the following format:</P>
                                <GPH SPAN="2" DEEP="306">
                                    <PRTPAGE P="689"/>
                                    <GID>ER08AP20.003</GID>
                                </GPH>
                                <P>(2) Incurred cost is determined by the Contractor's accounting books and records, to which the Contractor shall provide access upon request of the Contracting Officer. An acceptable accounting system in accordance with DFARS 252.242-7006 is not required for reporting of incurred costs under this clause. If the Contractor's accounting system is not capable of tracking costs on a job order basis, the Contractor shall provide a realistic approximation of the allocation of incurred costs attributable to this contract in accordance with the Contractor's accounting system. FAR 52.232-32(m) does not require certification of incurred costs.</P>
                                <P>
                                    (d) 
                                    <E T="03">Security for financing.</E>
                                     (1) Title to the property described in paragraph (f) of the clause at FAR 52.232-32, Performance-Based Payments, is the preferred security for receipt of performance-based payments.
                                </P>
                                <P>(2)(i) If the Contractor's accounting system is not capable of identifying and tracking through the build cycle the property that is allocable and properly chargeable to this contract, the Contracting Officer may consider acceptance of one or a combination of the following alternative forms of security sufficient to constitute adequate security for the performance-based payments and so specify in the contract, consistent with FAR 32.202-4:</P>
                                <P>(A) A paramount lien on assets.</P>
                                <P>(B) An irrevocable letter of credit from a federally insured financial institution.</P>
                                <P>(C) A bond from a surety, acceptable in accordance with FAR part 28.</P>
                                <P>(D) A guarantee of repayment from a person or corporation of demonstrated liquid net worth, connected by significant ownership interest to the Contractor.</P>
                                <P>(E) Title to identified Contractor assets of adequate worth.</P>
                                <P>
                                    (ii) Paragraph (f) of the clause at FAR 52.232-32 does not apply to the extent that the Contractor and the Contracting Officer agree on alternative forms of security. In the event the Contractor fails to provide adequate security, as required in this contract, no financing payment will be made under 
                                    <PRTPAGE P="690"/>
                                    this contract. Upon receipt of adequate security, financing payments will be made, including all previous payments to which the Contractor is entitled, in accordance with the terms of the provisions for contract financing. If at any time the Contracting Officer determines that the security provided by the Contractor is insufficient, the Contractor shall promptly provide such additional security as the Contracting Officer determines necessary. In the event the Contractor fails to provide such additional security, the Contracting Officer may collect or liquidate such security that has been provided and suspend further payments to the Contractor; and the Contractor shall repay to the Government the amount of unliquidated financing payments as the Contracting Officer at his sole discretion deems repayable.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[79 FR 17936, Mar. 31, 2014, as amended at 79 FR 23278, Apr. 28, 2014; 85 FR 19689, Apr. 8, 2020; 87 FR 76998, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.232-7014</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.232-7015</SECTNO>
                            <SUBJECT>Performance-Based Payments—Representation.</SUBJECT>
                            <P>As prescribed in 232.1005-70(b), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Performance-Based Payments—Representation (DEC 2022)</HD>
                                <P>(a) In accordance with 10 U.S.C. 3802(c), the Contractor's financial statements shall be in compliance with Generally Accepted Accounting Principles in order to receive performance-based payments.</P>
                                <P>(b) The Offeror represents that its financial statements are [ ] are not [ ] in compliance with Generally Accepted Accounting Principles.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[85 FR 19691, Apr. 8, 2020, as amended at 87 FR 76998, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.232-7016</SECTNO>
                            <SUBJECT>Notice of Progress Payments or Performance-Based Payments.</SUBJECT>
                            <P>As prescribed in 232.1005-70(c), insert the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Notice of Progress Payments or Performance-Based Payments (APR 2020)</HD>
                                <P>(a) The need for customary progress payments in accordance with subpart 32.5 of the Federal Acquisition Regulation (FAR) or performance-based payments in accordance with FAR subpart 32.10 will not be considered as a handicap or adverse factor in the award of the contract.</P>
                                <P>(b) This solicitation includes a FAR and Defense Federal Acquisition Regulation Supplement (DFARS) clause for performance-based payments and a FAR clause for progress payments. The resultant contract will include either performance-based payments or progress payments, not both, except as may be authorized on separate orders subject to FAR 32.1003(c).</P>
                                <P>(1) The performance-based payments clauses will be included in the contract if—</P>
                                <P>(i) The Offeror has provided positive representation in response to DFARS 252.232-7015, Performance-Based Payments—Representation;</P>
                                <P>(ii) The Offeror proposes a performance-based payment arrangement in accordance with FAR 52.232-28, Invitation to Propose Performance-Based Payments, including proposed events and timing, event completion criteria, event values, and expected expenditure profile; and</P>
                                <P>(iii) The Offeror and the Government reach agreement on all aspects of the arrangement.</P>
                                <P>(2) If performance-based payments clauses are not included in the resultant contract, the progress payments clause included in this solicitation will be included in any resultant contract, modified or altered if necessary in accordance with FAR 52.232-16 and its Alternate I. Even though the progress payments clause is included in the contract, the clause shall be inoperative during any time the contractor's accounting system and controls are determined by the Government to be inadequate for segregation and accumulation of contract costs.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[85 FR 19691, Apr. 8, 2020]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.232-7017</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.232-7018</SECTNO>
                            <SUBJECT>Progress Payments—Multiple Lots.</SUBJECT>
                            <P>As prescribed in 232.502-4-70(c), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Progress Payments—Multiple Lots (MAY 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Lot</E>
                                     means one or more fixed-price deliverable line items or deliverable subline items representing a single, severable group where the sum of the costs for each group is segregated and a single progress payment rate is used.
                                </P>
                                <P>
                                    <E T="03">Multiple lots</E>
                                     means more than one lot on a single contract where progress payment proration is performed on a lot-wide, versus contract-wide, basis.
                                    <PRTPAGE P="691"/>
                                </P>
                                <P>(b) When submitting progress payment requests under the billing instructions in Federal Acquisition Regulation (FAR) clause 52.232-16, Progress Payments, or Defense Federal Acquisition Regulation Supplement (DFARS) clause 252.232-7002, Progress Payments for Foreign Military Sales Acquisitions, of this contract, the Contractor shall—</P>
                                <P>(1) Submit separate progress payment requests for each lot identified in the contract;</P>
                                <P>(2) Identify the contract price for the lot as the sum of all fixed-priced line items identified to the lot, in accordance with FAR 32.501-3;</P>
                                <P>(3) Identify the lot on each progress payment request to which the request applies;</P>
                                <P>(4) Calculate each request on the basis of the price, costs (including the cost to complete), subcontractor financing, and progress payment liquidations of the lot to which it applies; and</P>
                                <P>(5) Distribute costs among lots in a manner acceptable to the Administrative Contracting Officer.</P>
                                <P>(c) Submit a separate progress payment request for U.S. and FMS requirements in accordance with the DFARS clause 252.232-7002, Progress Payments for Foreign Military Sales Acquisitions, of this contract.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[88 FR 33833, May 25, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.233-7000</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.233-7001</SECTNO>
                            <SUBJECT>Choice of law (overseas).</SUBJECT>
                            <P>As prescribed in 233.215-70, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Choice of Law (Overseas) (JUN 1997)</HD>
                                <P>This contract shall be construed and interpreted in accordance with the substantive laws of the United States of America. By the execution of this contract, the Contractor expressly agrees to waive any rights to invoke the jurisdiction of local national courts where this contract is performed and agrees to accept the exclusive jurisdiction of the United States Armed Services Board of Contract Appeals and the United States Court of Federal Claims for hearing and determination of any and all disputes that may arise under the Disputes clause of this contract.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[62 FR 34135, June 24, 1997]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.234-7001</SECTNO>
                            <SUBJECT>Notice of Earned Value Management System.</SUBJECT>
                            <P>As prescribed in 234.203(1), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Notice of Earned Value Management System (APR 2008)</HD>
                                <P>(a) If the offeror submits a proposal in the amount of $50,000,000 or more—</P>
                                <P>(1) The offeror shall provide documentation that the Cognizant Federal Agency (CFA) has determined that the proposed Earned Value Management System (EVMS) complies with the EVMS guidelines in the American National Standards Institute/Electronic Industries Alliance Standard 748, Earned Value Management Systems (ANSI/EIA-748) (current version at time of solicitation). The Government reserves the right to perform reviews of the EVMS when deemed necessary to verify compliance.</P>
                                <P>(2) If the offeror proposes to use a system that has not been determined to be in compliance with the requirements of paragraph (a)(1) of this provision, the offeror shall submit a comprehensive plan for compliance with the guidelines in ANSI/EIA-748.</P>
                                <P>(i) The plan shall—</P>
                                <P>(A) Describe the EVMS the offeror intends to use in performance of the contract, and how the proposed EVMS complies with the EVMS guidelines in ANSI/EIA-748;</P>
                                <P>(B) Distinguish between the offeror's existing management system and modifications proposed to meet the EVMS guidelines;</P>
                                <P>(C) Describe the management system and its application in terms of the EVMS guidelines;</P>
                                <P>(D) Describe the proposed procedure for administration of the EVMS guidelines as applied to subcontractors; and</P>
                                <P>(E) Describe the process the offeror will use to determine subcontractor compliance with ANSI/EIA-748.</P>
                                <P>(ii) The offeror shall provide information and assistance as required by the Contracting Officer to support review of the plan.</P>
                                <P>(iii) The offeror's EVMS plan must provide milestones that indicate when the offeror anticipates that the EVMS will be compliant with the guidelines in ANSI/EIA-748.</P>
                                <P>(b) If the offeror submits a proposal in an amount less than $50,000,000—</P>
                                <P>(1) The offeror shall submit a written description of the management procedures it will use and maintain in the performance of any resultant contract to comply with the requirements of the Earned Value Management System clause of the contract. The description shall include—</P>
                                <P>(i) A matrix that correlates each guideline in ANSI/EIA-748 (current version at time of solicitation) to the corresponding process in the offeror's written management procedures; and</P>
                                <P>(ii) The process the offeror will use to determine subcontractor compliance with ANSI/EIA-748.</P>
                                <P>
                                    (2) If the offeror proposes to use an EVMS that has been determined by the CFA to be 
                                    <PRTPAGE P="692"/>
                                    in compliance with the EVMS guidelines in ANSI/EIA-748, the offeror may submit a copy of the documentation of such determination instead of the written description required by paragraph (b)(1) of this provision.
                                </P>
                                <P>(c) The offeror shall identify the subcontractors (or the subcontracted effort if subcontractors have not been selected) to whom the EVMS requirements will apply. The offeror and the Government shall agree to the subcontractors or the subcontracted effort selected for application of the EVMS requirements. The offeror shall be responsible for ensuring that the selected subcontractors comply with the requirements of the Earned Value Management System clause of the contract.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[73 FR 21848, Apr. 23, 2008]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.234-7002</SECTNO>
                            <SUBJECT>Earned Value Management System.</SUBJECT>
                            <P>As prescribed in 234.203(2), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Earned Value Management System (MAY 2011)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Acceptable earned value management system</E>
                                     means an earned value management system that generally complies with system criteria in paragraph (b) of this clause.
                                </P>
                                <P>
                                    <E T="03">Earned value management system</E>
                                     means an earned value management system that complies with the earned value management system guidelines in the ANSI/EIA-748.
                                </P>
                                <P>
                                    <E T="03">Significant deficiency</E>
                                     means a shortcoming in the system that materially affects the ability of officials of the Department of Defense to rely upon information produced by the system that is needed for management purposes.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">System criteria.</E>
                                     In the performance of this contract, the Contractor shall use—
                                </P>
                                <P>(1) An Earned Value Management System (EVMS) that complies with the EVMS guidelines in the American National Standards Institute/Electronic Industries Alliance Standard 748, Earned Value Management Systems (ANSI/EIA-748); and</P>
                                <P>(2) Management procedures that provide for generation of timely, reliable, and verifiable information for the Contract Performance Report (CPR) and the Integrated Master Schedule (IMS) required by the CPR and IMS data items of this contract.</P>
                                <P>(c) If this contract has a value of $50 million or more, the Contractor shall use an EVMS that has been determined to be acceptable by the Cognizant Federal Agency (CFA). If, at the time of award, the Contractor's EVMS has not been determined by the CFA to be in compliance with the EVMS guidelines as stated in paragraph (b)(1) of this clause, the Contractor shall apply its current system to the contract and shall take necessary actions to meet the milestones in the Contractor's EVMS plan.</P>
                                <P>(d) If this contract has a value of less than $50 million, the Government will not make a formal determination that the Contractor's EVMS complies with the EVMS guidelines in ANSI/EIA-748 with respect to the contract. The use of the Contractor's EVMS for this contract does not imply a Government determination of the Contractor's compliance with the EVMS guidelines in ANSI/EIA-748 for application to future contracts. The Government will allow the use of a Contractor's EVMS that has been formally reviewed and determined by the CFA to be in compliance with the EVMS guidelines in ANSI/EIA-748.</P>
                                <P>(e) The Contractor shall submit notification of any proposed substantive changes to the EVMS procedures and the impact of those changes to the CFA. If this contract has a value of $50 million or more, unless a waiver is granted by the CFA, any EVMS changes proposed by the Contractor require approval of the CFA prior to implementation. The CFA will advise the Contractor of the acceptability of such changes as soon as practicable (generally within 30 calendar days) after receipt of the Contractor's notice of proposed changes. If the CFA waives the advance approval requirements, the Contractor shall disclose EVMS changes to the CFA at least 14 calendar days prior to the effective date of implementation.</P>
                                <P>(f) The Government will schedule integrated baseline reviews as early as practicable, and the review process will be conducted not later than 180 calendar days after—</P>
                                <P>(1) Contract award;</P>
                                <P>(2) The exercise of significant contract options; and</P>
                                <P>(3) The incorporation of major modifications.</P>
                                <FP>During such reviews, the Government and the Contractor will jointly assess the Contractor's baseline to be used for performance measurement to ensure complete coverage of the statement of work, logical scheduling of the work activities, adequate resourcing, and identification of inherent risks.</FP>
                                <P>(g) The Contractor shall provide access to all pertinent records and data requested by the Contracting Officer or duly authorized representative as necessary to permit Government surveillance to ensure that the EVMS complies, and continues to comply, with the performance criteria referenced in paragraph (b) of this clause.</P>
                                <P>
                                    (h) When indicated by contract performance, the Contractor shall submit a request for approval to initiate an over-target baseline or over-target schedule to the Contracting Officer. The request shall include a top-level projection of cost and/or schedule growth, a determination of whether or not 
                                    <PRTPAGE P="693"/>
                                    performance variances will be retained, and a schedule of implementation for the rebaselining. The Government will acknowledge receipt of the request in a timely manner (generally within 30 calendar days).
                                </P>
                                <P>
                                    (i) 
                                    <E T="03">Significant deficiencies.</E>
                                     (1) The Contracting Officer will provide an initial determination to the Contractor, in writing, on any significant deficiencies. The initial determination will describe the deficiency in sufficient detail to allow the Contractor to understand the deficiency.
                                </P>
                                <P>(2) The Contractor shall respond within 30 days to a written initial determination from the Contracting Officer that identifies significant deficiencies in the Contractor's EVMS. If the Contractor disagrees with the initial determination, the Contractor shall state, in writing, its rationale for disagreeing.</P>
                                <P>(3) The Contracting Officer will evaluate the Contractor's response and notify the Contractor, in writing, of the Contracting Officer's final determination concerning—</P>
                                <P>(i) Remaining significant deficiencies;</P>
                                <P>(ii) The adequacy of any proposed or completed corrective action;</P>
                                <P>(iii) System noncompliance, when the Contractor's existing EVMS fails to comply with the earned value management system guidelines in the ANSI/EIA-748; and</P>
                                <P>(iv) System disapproval, if initial EVMS validation is not successfully completed within the timeframe approved by the Contracting Officer, or if the Contracting Officer determines that the Contractor's earned value management system contains one or more significant deficiencies in high-risk guidelines in ANSI/EIA-748 standards (guidelines 1, 3, 6, 7, 8, 9, 10, 12, 16, 21, 23, 26, 27, 28, 30, or 32). When the Contracting Officer determines that the existing earned value management system contains one or more significant deficiencies in one or more of the remaining 16 guidelines in ANSI/EIA-748 standards, the contracting officer will use discretion to disapprove the system based on input received from functional specialists and the auditor.</P>
                                <P>(4) If the Contractor receives the Contracting Officer's final determination of significant deficiencies, the Contractor shall, within 45 days of receipt of the final determination, either correct the significant deficiencies or submit an acceptable corrective action plan showing milestones and actions to eliminate the significant deficiencies.</P>
                                <P>
                                    (j) 
                                    <E T="03">Withholding payments.</E>
                                     If the Contracting Officer makes a final determination to disapprove the Contractor's EVMS, and the contract includes the clause at 252.242-7005, Contractor Business Systems, the Contracting Officer will withhold payments in accordance with that clause.
                                </P>
                                <P>(k) With the exception of paragraphs (i) and (j) of this clause, the Contractor shall require its subcontractors to comply with EVMS requirements as follows:</P>
                                <P>(1) For subcontracts valued at $50 million or more, the following subcontractors shall comply with the requirements of this clause:</P>
                                <P>
                                    <E T="03">[Contracting Officer to insert names of subcontractors (or subcontracted effort if subcontractors have not been selected) designated for application of the EVMS requirements of this clause.]</E>
                                </P>
                                <FP SOURCE="FP-DASH"/>
                                <FP SOURCE="FP-DASH"/>
                                <FP SOURCE="FP-DASH"/>
                                <FP SOURCE="FP-DASH"/>
                                <P>(2) For subcontracts valued at less than $50 million, the following subcontractors shall comply with the requirements of this clause, excluding the requirements of paragraph (c) of this clause:</P>
                                <P>
                                    <E T="03">[Contracting Officer to insert names of subcontractors (or subcontracted effort if subcontractors have not been selected) designated for application of the EVMS requirements of this clause.]</E>
                                </P>
                                <FP SOURCE="FP-DASH"/>
                                <FP SOURCE="FP-DASH"/>
                                <FP SOURCE="FP-DASH"/>
                                <FP SOURCE="FP-DASH"/>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[76 FR 28873, May 18, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.234-7003</SECTNO>
                            <SUBJECT>Notice of Cost and Software Data Reporting System.</SUBJECT>
                            <P>
                                <E T="03">Basic.</E>
                                 As prescribed in 234.7101(a) and (a)(1), use the following provision:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Notice of Cost and Software Data Reporting System—Basic (NOV 2014)</HD>
                                <P>(a) This solicitation includes—</P>
                                <P>(1) The Government-approved cost and software data reporting (CSDR) plan for the contract, DD Form 2794; and</P>
                                <P>(2) The related Resource Distribution Table.</P>
                                <P>(b) As part of its proposal, the Offeror shall—</P>
                                <P>(1) Describe the process to be used to satisfy the requirements of the DoD 5000.04-M-1, CSDR Manual, and the Government-approved CSDR plan for the proposed contract;</P>
                                <P>(2) Demonstrate how contractor cost and data reporting (CCDR) will be based, to the maximum extent possible, upon actual cost transactions and not cost allocations;</P>
                                <P>(3) Demonstrate how the data from its accounting system will be mapped into the standard reporting categories required in the CCDR data item descriptions;</P>
                                <P>
                                    (4) Describe how recurring and nonrecurring costs will be segregated;
                                    <PRTPAGE P="694"/>
                                </P>
                                <P>(5) Provide comments on the adequacy of the CSDR contract plan and related Resource Distribution Table; and</P>
                                <P>(6) Submit the DD Form 1921, Cost Data Summary Report, and DD Form 1921-1, Functional Cost-Hour Report, with its pricing proposal.</P>
                                <P>(c) CSDR reporting will be required for subcontractors at any tier with a subcontract that exceeds $50 million. The offeror shall identify, by providing comments on the Resource Distribution Table, the subcontractors, or, if the subcontractors have not been selected, the subcontracted effort in this category.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <P>
                                <E T="03">Alternate I.</E>
                                 As prescribed in 234.7101(a) and (a)(2), use the following provision, which uses a different paragraph (c) than the basic provision:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Notice of Cost and Software Data Reporting System—Alternate I (NOV 2014)</HD>
                                <P>(a) This solicitation includes—</P>
                                <P>(1) The Government-approved cost and software data reporting (CSDR) plan for the contract, DD Form 2794; and</P>
                                <P>(2) The related Resource Distribution Table.</P>
                                <P>(b) As part of its proposal, the Offeror shall—</P>
                                <P>(1) Describe the process to be used to satisfy the requirements of the DoD 5000.04-M-1, CSDR Manual, and the Government-approved CSDR plan for the proposed contract;</P>
                                <P>(2) Demonstrate how contractor cost and data reporting (CCDR) will be based, to the maximum extent possible, upon actual cost transactions and not cost allocations;</P>
                                <P>(3) Demonstrate how the data from its accounting system will be mapped into the standard reporting categories required in the CCDR data item descriptions;</P>
                                <P>(4) Describe how recurring and nonrecurring costs will be segregated;</P>
                                <P>(5) Provide comments on the adequacy of the CSDR contract plan and related Resource Distribution Table; and</P>
                                <P>(6) Submit the DD Form 1921, Cost Data Summary Report, and DD Form 1921-1, Functional Cost-Hour Report, with its pricing proposal.</P>
                                <P>(c) CSDR reporting will be required for subcontractors for selected subcontracts identified in the CSDR contract plan as requiring such reporting. The offeror shall identify, by providing comments on the Resource Distribution Table, the subcontractors, or, if the subcontractors have not been selected, the subcontracted effort.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[75 FR 71562, Nov. 24, 2010, as amended at 79 FR 65594, Nov. 5, 2014; 80 FR 36899, June 26, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.234-7004</SECTNO>
                            <SUBJECT>Cost and Software Data Reporting System.</SUBJECT>
                            <P>
                                <E T="03">Basic.</E>
                                 As prescribed in 234.7101(b) and (b)(1), use the following clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Cost and Software Data Reporting System—Basic (NOV 2014)</HD>
                                <P>(a) In the performance of this contract, the Contractor shall use—</P>
                                <P>(1) A documented standard cost and software data reporting (CSDR) process that satisfies the guidelines contained in the DoD 5000.04-M-1, CSDR Manual;</P>
                                <P>(2) Management procedures that provide for generation of timely and reliable information for the contractor cost data reports (CCDRs) and software resources data reports (SRDRs) required by the CCDR and SRDR data items of this contract; and</P>
                                <P>(3) The Government-approved CSDR plan for this contract, DD Form 2794, and the related Resource Distribution Table as the basis for reporting in accordance with the required CSDR data item descriptions.</P>
                                <P>(b) The Contractor shall require CSDR reporting from subcontractors at any tier with a subcontract that exceeds $50 million. If, for subcontracts that exceed $50 million, the Contractor changes subcontractors or makes new subcontract awards, the Contractor shall notify the Government.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate I.</E>
                                 As prescribed in 234.7101(b) and (b)(2), use the following clause, which uses a different paragraph (b) than the basic clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Cost and Software Data Reporting System—Alternate I (NOV 2014)</HD>
                                <P>(a) In the performance of this contract, the Contractor shall use—</P>
                                <P>(1) A documented standard cost and software data reporting (CSDR) process that satisfies the guidelines contained in the DoD 5000.04-M-1, CSDR Manual;</P>
                                <P>(2) Management procedures that provide for generation of timely and reliable information for the contractor cost data reports (CCDRs) and software resources data reports (SRDRs) required by the CCDR and SRDR data items of this contract; and</P>
                                <P>
                                    (3) The Government-approved CSDR plan for this contract, DD Form 2794, and the related Resource Distribution Table as the basis for reporting in accordance with the required CSDR data item descriptions (DIDs).
                                    <PRTPAGE P="695"/>
                                </P>
                                <P>(b) The Contractor shall require CSDR reporting from selected subcontractors identified in the CSDR contract plan as requiring such reporting. If the Contractor changes subcontractors or makes new awards for selected subcontract effort, the Contractor shall notify the Government.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[75 FR 71562, Nov. 24, 2010, as amended at 79 FR 65594, Nov. 5, 2014; 80 FR 36900, June 26, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.235-7000</SECTNO>
                            <SUBJECT>Indemnification Under 10 U.S.C. 3861—Fixed Price.</SUBJECT>
                            <P>As prescribed in 235.070-3, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Indemnification Under 10 U.S.C. 3861—Fixed Price (DEC 2022)</HD>
                                <P>(a) This clause provides for indemnification under 10 U.S.C. 3861 if the Contractor meets all the terms and conditions of this clause.</P>
                                <P>(b) Claims, losses, and damages covered—</P>
                                <P>
                                    (1) Claims by third persons for death, bodily injury, sickness, or disease, or the loss, damage, or lost use of property. Claims include those for reasonable expenses of litigation or settlement. The term 
                                    <E T="03">third persons</E>
                                     includes employees of the contractor;
                                </P>
                                <P>(2) The loss, damage, and lost use of the Contractor's property, but excluding lost profit; and</P>
                                <P>(3) Loss, damage, or lost use of the Government's property.</P>
                                <P>(c) The claim, loss, or damage—</P>
                                <P>(1) Must arise from the direct performance of this contract;</P>
                                <P>(2) Must not be compensated by insurance or other means, or be within deductible amounts of the Contractor's insurance;</P>
                                <P>(3) Must result from an unusually hazardous risk as specifically defined in the contract;</P>
                                <P>(4) Must not result from willful misconduct or lack of good faith on the part of any of the Contractor's directors or officers, managers, superintendents, or other equivalent representatives who have supervision or direction of—</P>
                                <P>(i) All or substantially all of the Contractor's business;</P>
                                <P>(ii) All or substantially all of the Contractor's operations at any one plant or separate location where this contract is being performed; or</P>
                                <P>(iii) A separate and complete major industrial operation connected with the performance of this contract;</P>
                                <P>(5) Must not be a liability assumed under any contract or agreement (except for subcontracts covered by paragraph (h) of this clause), unless the Contracting Officer (or in contracts with the Department of the Navy, the Department) specifically approved the assumption of liability; and</P>
                                <P>(6) Must be certified as just and reasonable by the Secretary of the department or designated representative.</P>
                                <P>(d) The Contractor shall buy and maintain, to the extent available, insurance against unusually hazardous risks in the form, amount, period(s) of time, at the rate(s), and with such insurers, as the Contracting Officer (or, for Navy contracts, the Department) may from time to time require and approve. If the cost of this insurance is higher than the cost of the insurance the Contractor had as of the date of the contract, the Government shall reimburse the Contractor for the difference in cost, as long as it is properly allocable to this contract and is not included in the contract price. The Government shall not be liable for claims, loss, or damage if insurance was available and is either required or approved under this paragraph.</P>
                                <P>(e) A reduction of the insurance coverage maintained by the Contractor on the date of the execution of this contract shall not increase the Government's liability under this clause unless the Contracting Officer consents, and the contract price is equitably adjusted, if appropriate, to reflect the Contractor's consideration for the Government's assumption of increased liability.</P>
                                <P>
                                    (f) 
                                    <E T="03">Notice.</E>
                                     The Contractor shall—
                                </P>
                                <P>(1) Promptly notify the Contracting Officer of any occurrence, action, or claim that might trigger the Government's liability under this clause;</P>
                                <P>(2) Furnish the proof or evidence of any claim, loss, or damage in the form and manner that the Government requires; and</P>
                                <P>(3) Immediately provide copies of all pertinent papers that the Contractor receives or has received.</P>
                                <P>(g) The Government may direct, participate in, and supervise the settlement or defense of the claim or action. The Contractor shall comply with the Government's directions and execute any authorizations required.</P>
                                <P>
                                    (h) 
                                    <E T="03">Flowdown.</E>
                                     The Government shall indemnify the Contractor if the Contractor has an obligation to indemnify a subcontractor under any subcontract at any tier under this contract for the unusually hazardous risk identified in this contract only if—
                                </P>
                                <P>(1) The Contracting Officer gave prior written approval for the Contractor to provide in a subcontract for the Contractor to indemnify the subcontractor for unusually hazardous risks defined in this contract;</P>
                                <P>(2) The Contracting Officer approved those indemnification provisions;</P>
                                <P>
                                    (3) The subcontract indemnification provisions entitle the Contractor, or the Government, or both, to direct, participate in, and supervise the settlement or defense of relevant actions and claims; and
                                    <PRTPAGE P="696"/>
                                </P>
                                <P>(4) The subcontract provides the same rights and duties, the same provisions for notice, furnishing of papers and the like, between the Contractor and the subcontractor, as exist between the Government and the Contractor under this clause.</P>
                                <P>(i) The Government may discharge its obligations under paragraph (h) of this clause by making payments directly to subcontractors or to persons to whom the subcontractors may be liable.</P>
                                <P>(j) The rights and obligations of the parties under this clause shall survive the termination, expiration, or completion of this contract.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36284, 36479, July 31, 1991, as amended at 87 FR 76998, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.235-7001</SECTNO>
                            <SUBJECT>Indemnification Under 10 U.S.C. 3861—Cost Reimbursement.</SUBJECT>
                            <P>As prescribed in 235.070-3, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Indemnification Under 10 U.S.C. 3861—Cost Reimbursement (DEC 2022)</HD>
                                <P>(a) This clause provides for indemnification under 10 U.S.C. 3861 if the Contractor meets all the terms and conditions of this clause.</P>
                                <P>(b) Claims, losses, and damages covered—</P>
                                <P>(1) Claims by third persons for death, bodily injury, sickness, or disease, or the loss, damage, or lost use of property. Claims include those for reasonable expenses of litigation or settlement. The term “third persons” includes employees of the Contractor;</P>
                                <P>(2) The loss, damage, and lost use of the Contractor's property, but excluding lost profit; and</P>
                                <P>(3) Loss, damage, or lost use of the Government's property.</P>
                                <P>(c) The claim, loss, or damage—</P>
                                <P>(1) Must arise from the direct performance of this contract;</P>
                                <P>(2) Must not be compensated by insurance or other means, or be within deductible amounts of the Contractor's insurance;</P>
                                <P>(3) Must result from an unusually hazardous risk as specifically defined in the contract;</P>
                                <P>(4) Must not result from willful misconduct or lack of good faith on the part of any of the Contractor's directors or officers, managers, superintendents, or other equivalent representatives who have supervision or direction of—</P>
                                <P>(i) All or substantially all of the Contractor's business;</P>
                                <P>(ii) All or substantially all of the Contractor's operations at any one plant or separate location where this contract is being performed; or</P>
                                <P>(iii) A separate and complete major industrial operation connected with the performance of this contract;</P>
                                <P>(5) Must not be a liability assumed under any contract or agreement (except for subcontracts covered by paragraph (i) of this clause), unless the Contracting Officer (or in contracts with the Department of the Navy, the Department) specifically approved the assumption of liability; and</P>
                                <P>(6) Must be certified as just and reasonable by the Secretary of the department or designated representative.</P>
                                <P>(d) A reduction of the insurance coverage maintained by the Contractor on the date of the execution of this contract shall not increase the Government's liability under this clause unless the Contracting Officer consents, and the contract price is equitably adjusted, if appropriate, to reflect the Contractor's consideration for the Government's assumption of increased liability.</P>
                                <P>
                                    (e) 
                                    <E T="03">Notice.</E>
                                     The Insurance—Liability to Third Persons clause of this contract applies also to claims under this clause. In addition, the Contractor shall—
                                </P>
                                <P>(1) Promptly notify the Contracting Officer of any occurrence, action, or claim that might trigger the Government's liability under this clause;</P>
                                <P>(2) Furnish the proof or evidence of any claim, loss, or damage in the form and manner that the Government requires; and</P>
                                <P>(3) Immediately provide copies of all pertinent papers that the contractor receives or has received.</P>
                                <P>(f) The Government may direct, participate in, and supervise the settlement or defense of the claim or action. The Contractor shall comply with the Government's directions, and execute any authorizations required.</P>
                                <P>(g) The Limitation of Cost clause of this contract does not apply to the Government's obligations under this clause. The obligations under this clause are excepted from the release required by the Allowable Cost, Fee, and Payment clause of this contract.</P>
                                <P>(h) Under this clause, a claim, loss, or damage arises from the direct performance of this contract if the cause of the claim, loss, or damage occurred during the period of performance of this contract or as a result of the performance of this contract.</P>
                                <P>
                                    (i) 
                                    <E T="03">Flowdown.</E>
                                     The Government shall indemnify the Contractor if the Contractor has an obligation to indemnify a subcontractor under any subcontract at any tier under this contract for the unusually hazardous risk identified in this contract only if—
                                </P>
                                <P>(1) The Contracting Officer gave prior written approval for the Contractor to provide in a subcontract for the Contractor to indemnify the subcontractor for unusually hazardous risks defined in this contract;</P>
                                <P>
                                    (2) The Contracting Officer approved those indemnification provisions;
                                    <PRTPAGE P="697"/>
                                </P>
                                <P>(3) The subcontract indemnification provisions entitle the Contractor, or the Government, or both, to direct, participate in, and supervise the settlement or defense of relevant actions and claims; and</P>
                                <P>(4) The subcontract provides the same rights and duties, the same provisions for notice, furnishing of paper and the like, between the Contractor and the subcontractor, as exist between the Government and the Contractor under this clause.</P>
                                <P>(j) The Government may discharge its obligations under paragraph (i) of this clause by making payments directly to subcontractors or to persons to whom the subcontractors may be liable.</P>
                                <P>(k) The rights and obligations of the parties under this clause shall survive the termination, expiration, or completion of this contract.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36284, 36479, July 31, 1991, as amended at 87 FR 76998, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.235-7002</SECTNO>
                            <SUBJECT>Animal welfare.</SUBJECT>
                            <P>As prescribed in 235.072(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Animal Welfare (DEC 2014)</HD>
                                <P>(a)(1) The Contractor shall register its research, development, test, and evaluation or training facility with the Secretary of Agriculture in accordance with 7 U.S.C. 2136 and 9 CFR subpart C, and section 2.30, unless otherwise exempt from this requirement by meeting the conditions in 7 U.S.C. 2136 and 9 CFR parts 1 through 4 for the duration of the activity. The Contractor shall have its proposed animal use approved in accordance with Department of Defense Instruction (DoDI) 3216.01, Use of Animals in DoD Programs, by a DoD Component Headquarters Oversight Office. The Contractor shall furnish evidence of such registration and approval to the Contracting Officer before beginning work under this contract.</P>
                                <P>(2) The Contractor shall make its animals, and all premises, facilities, vehicles, equipment, and records that support animal care available during business hours and at other times mutually agreeable to the Contractor and the United States Department of Agriculture Office of Animal and Plant Health Inspection Service (USDA/APHIS) representative, personnel representing the DoD component oversight offices, as well as the Contracting Officer, to ascertain that the Contractor is compliant with 7 U.S.C. 2131-2159 and 9 CFR parts 1 through 4.</P>
                                <P>
                                    (b) The Contractor shall acquire animals in accordance with DoDI 3216.01, current at time of award (
                                    <E T="03">http://www.dtic.mil/whs/directives/corres/pdf/321601p.pdf</E>
                                    ).
                                </P>
                                <P>
                                    (c) The Contractor agrees that the care and use of animals will conform with the pertinent laws of the United States, regulations of the Department of Agriculture, and policies and procedures of the Department of Defense (see 7 U.S.C. 2131 
                                    <E T="03">et seq.,</E>
                                     and 9 CFR subchapter A, parts 1 through 4, DoDI 3216.01, Army Regulation 40-33/SECNAVINST 3900.38C/AFMAN 40-401(I)/DARPAINST 18/USUHSINST 3203). The Contractor shall also comply with DoDI 1322.24, Medical Readiness Training, if this contract includes acquisition of training.
                                </P>
                                <P>(d) The Contracting Officer may immediately suspend, in whole or in part, work and further payments under this contract for failure to comply with the requirements of paragraphs (a) through (c) of this clause.</P>
                                <P>(1) The suspension will stay in effect until the Contractor complies with the requirements.</P>
                                <P>(2) Failure to complete corrective action within the time specified by the Contracting Officer may result in termination of this contract and, if applicable, removal of the Contractor's name from the approved vendor list for live animals used in medical training.</P>
                                <P>
                                    (e) The Contractor may request registration of its facility by contacting USDA/APHIS/AC, 4700 River Road, Unit 84, Riverdale, MD 20737-1234, or via the APHIS Animal Care Web site at: 
                                    <E T="03">http://www.aphis.usda.gov/wps/portal/aphis/ourfocus/animalwelfare.</E>
                                </P>
                                <P>(f) The Contractor shall include the substance of this clause, including this paragraph (f), in all subcontracts involving research, development, test, and evaluation or training that use live vertebrate animals.</P>
                            </EXTRACT>
                            <CITA>[79 FR 73501, Dec. 11, 2014]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.235-7003</SECTNO>
                            <SUBJECT>Frequency Authorization.</SUBJECT>
                            <P>
                                <E T="03">Basic.</E>
                                 As prescribed in 234.7101(b) and (b)(1), use the following clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Frequency Authorization—Basic (MAR 2014)</HD>
                                <P>(a) The Contractor shall obtain authorization for radio frequencies required in support of this contract.</P>
                                <P>(b) For any experimental, developmental, or operational equipment for which the appropriate frequency allocation has not been made, the Contractor shall provide the technical operating characteristics of the proposed electromagnetic radiating device to the Contracting Officer during the initial planning, experimental, or developmental phase of contract performance.</P>
                                <P>(c) The Contracting Officer shall furnish the procedures for obtaining radio frequency authorization.</P>
                                <P>
                                    (d) The Contractor shall include this clause, including this paragraph (d), in all 
                                    <PRTPAGE P="698"/>
                                    subcontracts requiring the development, production, construction, testing, or operation of a device for which a radio frequency authorization is required.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate I.</E>
                                 As prescribed in 234.072(b) and (b)(2), use the following clause, which uses a different paragraph (c) than the basic clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Frequency Authorization—Alternate I (MAR 2014)</HD>
                                <P>(a) The Contractor shall obtain authorization for radio frequencies required in support of this contract.</P>
                                <P>(b) For any experimental, developmental, or operational equipment for which the appropriate frequency allocation has not been made, the Contractor shall provide the technical operating characteristics of the proposed electromagnetic radiating device to the Contracting Officer during the initial planning, experimental, or developmental phase of contract performance.</P>
                                <P>(c) The Contractor shall use DD Form 1494, Application for Equipment Frequency Allocation, to obtain radio frequency authorization.</P>
                                <P>(d) The Contractor shall include this clause, including this paragraph (d), in all subcontracts requiring the development, production, construction, testing, or operation of a device for which a radio frequency authorization is required.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 73 FR 42279, July 21, 2008; 79 FR 17448, Mar. 28, 2014; 80 FR 36900, June 26, 2015; 86 FR 27278, May 20, 2021]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.235-7004</SECTNO>
                            <SUBJECT>Protection of Human Subjects.</SUBJECT>
                            <P>As prescribed in 235.072(e), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Protection of Human Subjects (JUL 2009)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    (1) 
                                    <E T="03">Assurance of compliance</E>
                                     means a written assurance that an institution will comply with requirements of 32 CFR Part 219, as well as the terms of the assurance, which the Human Research Protection Official determines to be appropriate for the research supported by the Department of Defense (DoD) component (32 CFR 219.103).
                                </P>
                                <P>
                                    (2) 
                                    <E T="03">Human Research Protection Official (HRPO)</E>
                                     means the individual designated by the head of the applicable DoD component and identified in the component's Human Research Protection Management Plan as the official who is responsible for the oversight and execution of the requirements of this clause, although some DoD components may use a different title for this position.
                                </P>
                                <P>
                                    (3) 
                                    <E T="03">Human subject</E>
                                     means a living individual about whom an investigator (whether professional or student) conducting research obtains data through intervention or interaction with the individual, or identifiable private information (32 CFR 219.102(f)). For example, this could include the use of human organs, tissue, and body fluids from individually identifiable living human subjects as well as graphic, written, or recorded information derived from individually identifiable living human subjects.
                                </P>
                                <P>
                                    (4) 
                                    <E T="03">Institution</E>
                                     means any public or private entity or agency (32 CFR 219.102(b)).
                                </P>
                                <P>
                                    (5) 
                                    <E T="03">Institutional Review Board (IRB)</E>
                                     means a board established for the purposes expressed in 32 CFR Part 219 (32 CFR 219.102(g)).
                                </P>
                                <P>
                                    (6) 
                                    <E T="03">IRB approval</E>
                                     means the determination of the IRB that the research has been reviewed and may be conducted at an institution within the constraints set forth by the IRB and by other institutional and Federal requirements (32 CFR 219.102(h)).
                                </P>
                                <P>
                                    (7) 
                                    <E T="03">Research</E>
                                     means a systematic investigation, including research, development, testing, and evaluation, designed to develop or contribute to generalizable knowledge. Activities that meet this definition constitute research for purposes of 32 CFR Part 219, whether or not they are conducted or supported under a program that is considered research for other purposes. For example, some demonstration and service programs may include research activities (32 CFR 219.102(d)).
                                </P>
                                <P>(b) The Contractor shall oversee the execution of the research to ensure compliance with this clause. The Contractor shall comply fully with 32 CFR Part 219 and DoD Directive 3216.02, applicable DoD component policies, 10 U.S.C. 980, and, when applicable, Food and Drug Administration policies and regulations.</P>
                                <P>(c) The Contractor shall not commence performance of research involving human subjects that is covered under 32 CFR Part 219 or that meets exemption criteria under 32 CFR 219.101(b), or expend funding on such effort, until and unless the conditions of either the following paragraph (c)(1) or (c)(2) have been met:</P>
                                <P>
                                    (1) The Contractor furnishes to the HRPO, with a copy to the Contracting Officer, an assurance of compliance and IRB approval and receives notification from the Contracting Officer that the HRPO has approved the assurance as appropriate for the research under the Statement of Work and also that the HRPO has reviewed the protocol and accepted the IRB approval for compliance with the DoD component policies. The Contractor may furnish evidence of an existing assurance of compliance for acceptance by the HRPO, if an appropriate assurance has been 
                                    <PRTPAGE P="699"/>
                                    approved in connection with previous research. The Contractor shall notify the Contracting Officer immediately of any suspensions or terminations of the assurance.
                                </P>
                                <P>(2) The Contractor furnishes to the HRPO, with a copy to the Contracting Officer, a determination that the human research proposed meets exemption criteria in 32 CFR 219.101(b) and receives written notification from the Contracting Officer that the exemption is determined acceptable. The determination shall include citation of the exemption category under 32 CFR 219.101(b) and a rationale statement. In the event of a disagreement regarding the Contractor's furnished exemption determination, the HRPO retains final judgment on what research activities or classes of research are covered or are exempt under the contract.</P>
                                <P>(d) DoD staff, consultants, and advisory groups may independently review and inspect the Contractor's research and research procedures involving human subjects and, based on such findings, DoD may prohibit research that presents unacceptable hazards or otherwise fails to comply with DoD procedures.</P>
                                <P>(e) Failure of the Contractor to comply with the requirements of this clause will result in the issuance of a stop-work order under Federal Acquisition Regulation clause 52.242-15 to immediately suspend, in whole or in part, work and further payment under this contract, or will result in other issuance of suspension of work and further payment for as long as determined necessary at the discretion of the Contracting Officer.</P>
                                <P>(f) The Contractor shall include the substance of this clause, including this paragraph (f), in all subcontracts that may include research involving human subjects in accordance with 32 CFR Part 219, DoD Directive 3216.02, and 10 U.S.C. 980, including research that meets exemption criteria under 32 CFR 219.101(b). This clause does not apply to subcontracts that involve only the use of cadaver materials.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[74 FR 37648, July 29, 2009]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.235-7005—252.235-7009</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.235-7010</SECTNO>
                            <SUBJECT>Acknowledgment of support and disclaimer.</SUBJECT>
                            <P>As prescribed in 235.072(c), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Acknowledgment of Support and Disclaimer (MAY 1995)</HD>
                                <P>(a) The Contractor shall include an acknowledgment of the Government's support in the publication of any material based on or developed under this contract, stated in the following terms: This material is based upon work supported by the (name of contracting agency(ies)) under Contract No. (Contracting agency(ies) contract number(s)).</P>
                                <P>(b) All material, except scientific articles or papers published in scientific journals, must, in addition to any notices or disclaimers by the Contractor, also contain the following disclaimer: Any opinions, findings and conclusions or recommendations expressed in this material are those of the author(s) and do not necessarily reflect the views of the (name of contracting agency(ies)).</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[60 FR 29503, June 5, 1995, as amended at 73 FR 42279, July 21, 2008]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.235-7011</SECTNO>
                            <SUBJECT>Final scientific or technical report.</SUBJECT>
                            <P>As prescribed in 235.072(d), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Final Scientific or Technical Report (DEC 2019)</HD>
                                <P>The Contractor shall—</P>
                                <P>
                                    (a) Submit an electronic copy of the approved final scientific or technical report, not a summary, delivered under this contract to the Defense Technical Information Center (DTIC) through the web-based input system at 
                                    <E T="03">https://discover.dtic.mil/submit-documents/</E>
                                     as required by DoD Instruction 3200.12, DoD Scientific and Technical Information Program (STIP). Include a completed Standard Form (SF) 298, Report Documentation Page, in the document, or complete the web-based SF 298.
                                </P>
                                <P>
                                    (b) For instructions on submitting multi-media reports, follow the instructions at 
                                    <E T="03">https://discover.dtic.mil/submit-documents/</E>
                                    .
                                </P>
                                <P>
                                    (c) Email classified reports (up to Secret) to 
                                    <E T="03">dtic.belvoir.da.mbx.tr@mail.smil.mil</E>
                                    . If a SIPRNET email capability is not available, follow the classified submission instructions at 
                                    <E T="03">https://discover.dtic.mil/submit-documents/</E>
                                    .
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[80 FR 4806, Jan. 29, 2015, as amended at 84 FR 72563, Dec. 31, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.236-7000</SECTNO>
                            <SUBJECT>Modification proposals—price breakdown.</SUBJECT>
                            <P>As prescribed in 236.570(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Modification Proposals—Price Breakdown (DEC 1991)</HD>
                                <P>
                                    (a) The Contractor shall furnish a price breakdown, itemized as required and within 
                                    <PRTPAGE P="700"/>
                                    the time specified by the Contracting Officer, with any proposal for a contract modification.
                                </P>
                                <P>(b) The price breakdown—</P>
                                <P>(1) Must include sufficient detail to permit an analysis of profit, and of all costs for—</P>
                                <P>(i) Material;</P>
                                <P>(ii) Labor;</P>
                                <P>(iii) Equipment;</P>
                                <P>(iv) Subcontracts; and</P>
                                <P>(v) Overhead; and</P>
                                <P>(2) Must cover all work involved in the modification, whether the work was deleted, added, or changed.</P>
                                <P>(c) The Contractor shall provide similar price breakdowns to support any amounts claimed for subcontracts.</P>
                                <P>(d) The Contractor's proposal shall include a justification for any time extension proposed.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.236-7001</SECTNO>
                            <SUBJECT>Contract drawings and specifications.</SUBJECT>
                            <P>As prescribed in 236.570(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Contract Drawings and Specifications (AUG 2000)</HD>
                                <P>(a) The Government will provide to the Contractor, without charge, one set of contract drawings and specifications, except publications incorporated into the technical provisions by reference, in electronic or paper media as chosen by the Contracting Officer.</P>
                                <P>(b) The Contractor shall—</P>
                                <P>(1) Check all drawings furnished immediately upon receipt;</P>
                                <P>(2) Compare all drawings and verify the figures before laying out the work;</P>
                                <P>(3) Promptly notify the Contracting Officer of any discrepancies;</P>
                                <P>(4) Be responsible for any errors that might have been avoided by complying with this paragraph (b); and</P>
                                <P>(5) Reproduce and print contract drawings and specifications as needed.</P>
                                <P>(c) In general—</P>
                                <P>(1) Large-scale drawings shall govern small-scale drawings; and</P>
                                <P>(2) The Contractor shall follow figures marked on drawings in preference to scale measurements.</P>
                                <P>(d) Omissions from the drawings or specifications or the misdescription of details of work that are manifestly necessary to carry out the intent of the drawings and specifications, or that are customarily performed, shall not relieve the Contractor from performing such omitted or misdescribed details of the work. The Contractor shall perform such details as if fully and correctly set forth and described in the drawings and specifications.</P>
                                <P>(e) The work shall conform to the specifications and the contract drawings identified on the following index of drawings:</P>
                                <FP>Title  File  Drawing No.</FP>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[65 FR 50152, Aug. 17, 2000]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.236-7002</SECTNO>
                            <SUBJECT>Obstruction of navigable waterways.</SUBJECT>
                            <P>As prescribed in 236.570(b)(1), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Obstruction of Navigable Waterways (DEC 1991)</HD>
                                <P>(a) The Contractor shall—</P>
                                <P>(1) Promptly recover and remove any material, plant, machinery, or appliance which the contractor loses, dumps, throws overboard, sinks, or misplaces, and which, in the opinion of the Contracting Officer, may be dangerous to or obstruct navigation;</P>
                                <P>(2) Give immediate notice, with description and locations of any such obstructions, to the Contracting Officer; and</P>
                                <P>(3) When required by the Contracting Officer, mark or buoy such obstructions until the same are removed.</P>
                                <P>(b) The Contracting Officer may—</P>
                                <P>(1) Remove the obstructions by contract or otherwise should the Contractor refuse, neglect, or delay compliance with paragraph (a) of this clause; and</P>
                                <P>(2) Deduct the cost of removal from any monies due or to become due to the Contractor; or</P>
                                <P>(3) Recover the cost of removal under the Contractor's bond.</P>
                                <P>
                                    (c) The Contractor's liability for the removal of a vessel wrecked or sunk without fault or negligence is limited to that provided in sections 15, 19, and 20 of the River and Harbor Act of March 3, 1899 (33 U.S.C. 410 
                                    <E T="03">et seq.</E>
                                    ).
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.236-7003</SECTNO>
                            <SUBJECT>Payment for mobilization and preparatory work.</SUBJECT>
                            <P>As prescribed in 236.570(b)(2), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Payment for Mobilization and Preparatory Work (JAN 1997)</HD>
                                <P>(a) The Government will make payment to the Contractor under the procedures in this clause for mobilization and preparatory work under item no. __________.</P>
                                <P>
                                    (b) Payments will be made for actual payments by the Contractor on work preparatory to commencing actual work on the construction items for which payment is provided under the terms of this contract, as follows—
                                    <PRTPAGE P="701"/>
                                </P>
                                <P>(1) For construction plant and equipment exceeding $25,000 in value per unit (as appraised by the Contracting Officer at the work site) acquired for the execution of the work;</P>
                                <P>(2) Transportation of all plant and equipment to the site;</P>
                                <P>(3) Material purchased for the prosecution of the contract, but not to be incorporated in the work;</P>
                                <P>(4) Construction of access roads or railroads, camps, trailer courts, mess halls, dormitories or living quarters, field headquarters facilities, and construction yards;</P>
                                <P>(5) Personal services; and</P>
                                <P>(6) Hire of plant.</P>
                                <P>(c) Requests for payment must include—</P>
                                <P>(1) An account of the Contractor's actual expenditures;</P>
                                <P>(2) Supporting documentation, including receipted bills or copies of payrolls and freight bills; and</P>
                                <P>(3) The Contractor's documentation—</P>
                                <P>(i) Showing that it has acquired the construction plant, equipment, and material free from all encumbrances;</P>
                                <P>(ii) Agreeing that the construction plant, equipment, and material will not be removed from the site without the written permission of the Contracting Officer; and</P>
                                <P>(iii) Agreeing that structures and facilities prepared or erected for the prosecution of the contract work will be maintained and not dismantled prior to the completion and acceptance of the entire work, without the written permission of the Contracting Officer.</P>
                                <P>(d) Upon receiving a request for payment, the Government will make payment, less any prescribed retained percentage, if—</P>
                                <P>(1) The Contracting Officer finds the—</P>
                                <P>(i) Construction plant, material, equipment, and the mobilization and preparatory work performed are suitable and necessary to the efficient prosecution of the contract; and</P>
                                <P>(ii) Preparatory work has been done with proper economy and efficiency.</P>
                                <P>(2) Payments for construction plant, equipment, material, and structures and facilities prepared or erected for prosecution of the contract work do not exceed—</P>
                                <P>(i) The Contractor's cost for the work performed less the estimated value upon completion of the contract; and</P>
                                <P>(ii) 100 percent of the cost to the contractor of any items having no appreciable salvage value; and</P>
                                <P>(iii) 75 percent of the cost to the contractor of items which do have an appreciable salvage value.</P>
                                <P>(e) (1) Payments will continue to be made for item no. ________, and all payments will be deducted from the contract price for this item, until the total deductions reduce this item to zero, after which no further payments will be made under this item.</P>
                                <P>(2) If the total of payments so made does not reduce this item to zero, the balance will be paid to the Contractor in the final payment under the contract.</P>
                                <P>(3) The retained percentage will be paid in accordance with the Payments to Contractor clause of this contract.</P>
                                <P>(f) The Contracting Officer shall determine the value and suitability of the construction plant, equipment, materials, structures and facilities. The Contracting Officer's determinations are not subject to appeal.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 62 FR 2614, Jan. 17, 1997]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.236-7004</SECTNO>
                            <SUBJECT>Payment for mobilization and demobilization.</SUBJECT>
                            <P>As prescribed in 236.570(b)(2), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Payment for Mobilization and Demobilization (DEC 1991)</HD>
                                <P>(a) The Government will pay all costs for the mobilization and demobilization of all of the Contractor's plant and equipment at the contract lump sum price for this item.</P>
                                <P>(1) ________ percent of the lump sum price upon completion of the contractor's mobilization at the work site.</P>
                                <P>(2) The remaining ________ percent upon completion of demobilization.</P>
                                <P>(b) The Contracting Officer may require the Contractor to furnish cost data to justify this portion of the bid if the Contracting Officer believes that the percentages in paragraphs (a) (1) and (2) of this clause do not bear a reasonable relation to the cost of the work in this contract.</P>
                                <P>(1) Failure to justify such price to the satisfaction of the Contracting Officer will result in payment, as determined by the Contracting Officer, of—</P>
                                <P>(i) Actual mobilization costs at completion of mobilization;</P>
                                <P>(ii) Actual demobilization costs at completion of demobilization; and</P>
                                <P>(iii) The remainder of this item in the final payment under this contract.</P>
                                <P>(2) The Contracting Officer's determination of the actual costs in paragraph (b)(1) of this clause is not subject to appeal.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.236-7005</SECTNO>
                            <SUBJECT>Airfield safety precautions.</SUBJECT>
                            <P>As prescribed in 236.570(b)(3), use the following clause. At some airfields, the width of the primary surface is 1,500 feet (750 feet on each side of the runway centerline). In such instances, substitute the proper width in the clause.</P>
                            <EXTRACT>
                                <PRTPAGE P="702"/>
                                <HD SOURCE="HD1">Airfield Safety Precautions (DEC 1991)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    (1) 
                                    <E T="03">Landing areas</E>
                                     means—
                                </P>
                                <P>(i) The primary surfaces, comprising the surface of the runway, runway shoulders, and lateral safety zones. The length of each primary surface is the same as the runway length. The width of each primary surface is 2,000 feet (1,000 feet on each side of the runway centerline);</P>
                                <P>
                                    (ii) The 
                                    <E T="03">clear zone</E>
                                     beyond the ends of each runway, i.e., the extension of the primary surface for a distance of 1,000 feet beyond each end of each runway;
                                </P>
                                <P>(iii) All taxiways, plus the lateral clearance zones along each side for the length of the taxiways (the outer edge of each lateral clearance zone is laterally 250 feet from the far or opposite edge of the taxiway, e.g., a 75-foot-wide taxiway would have a combined width of taxiway and lateral clearance zones of 425 feet); and</P>
                                <P>(iv) All aircraft parking aprons, plus the area 125 feet in width extending beyond each edge all around the aprons.</P>
                                <P>
                                    (2) 
                                    <E T="03">Safety precaution areas</E>
                                     means those portions of approach-departure clearance zones and transitional zones where placement of objects incident to contract performance might result in vertical projections at or above the approach-departure clearance, or the transitional surface.
                                </P>
                                <P>
                                    (i) The 
                                    <E T="03">approach-departure clearance surface</E>
                                     is an extension of the primary surface and the clear zone at each end of each runway, for a distance of 50,000 feet, first along an inclined (glide angle) and then along a horizontal plane, both flaring symmetrically about the runway centerline extended.
                                </P>
                                <P>(A) The inclined plane (glide angle) begins in the clear zone 200 feet past the end of the runway (and primary surface) at the same elevation as the end of the runway. It continues upward at a slope of 50:1 (1 foot vertically for each 50 feet horizontally) to an elevation of 500 feet above the established airfield elevation. At that point the plane becomes horizontal, continuing at that same uniform elevation to a point 50,000 feet longitudinally from the beginning of the inclined plane (glide angle) and ending there.</P>
                                <P>(B) The width of the surface at the beginning of the inclined plane (glide angle) is the same as the width of the clear zone. It then flares uniformly, reaching the maximum width of 16,000 feet at the end.</P>
                                <P>
                                    (ii) The 
                                    <E T="03">approach-departure clearance zone</E>
                                     is the ground area under the approach-departure clearance surface.
                                </P>
                                <P>
                                    (iii) The 
                                    <E T="03">transitional surface</E>
                                     is a sideways extension of all primary surfaces, clear zones, and approach-departure clearance surfaces along inclined planes.
                                </P>
                                <P>(A) The inclined plane in each case begins at the edge of the surface.</P>
                                <P>(B) The slope of the incline plane is 7:1 (1 foot vertically for each 7 feet horizontally). It continues to the point of intersection with the—</P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) Inner horizontal surface (which is the horizontal plane 150 feet above the established airfield elevation); or
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) Outer horizontal surface (which is the horizontal plane 500 feet above the established airfield elevation), whichever is applicable.
                                </P>
                                <P>(iv) The “transitional zone” is the ground area under the transitional surface. (It adjoins the primary surface, clear zone, and approach-departure clearance zone.)</P>
                                <P>
                                    (b) 
                                    <E T="03">General.</E>
                                     (1) The Contractor shall comply with the requirements of this clause while—
                                </P>
                                <P>(i) Operating all ground equipment (mobile or stationary);</P>
                                <P>(ii) Placing all materials; and</P>
                                <P>(iii) Performing all work, upon and around all airfields.</P>
                                <P>(2) The requirements of this clause are in addition to any other safety requirements of this contract.</P>
                                <P>(c) The Contractor shall—</P>
                                <P>(1) Report to the Contracting Officer before initiating any work;</P>
                                <P>(2) Notify the Contracting Officer of proposed changes to locations and operations;</P>
                                <P>(3) Not permit either its equipment or personnel to use any runway for purposes other than aircraft operation without permission of the Contracting Officer, unless the runway is—</P>
                                <P>(i) Closed by order of the Contracting Officer; and</P>
                                <P>(ii) Marked as provided in paragraph (d)(2) of this clause;</P>
                                <P>(4) Keep all paved surfaces, such as runways, taxiways, and hardstands, clean at all times and, specifically, free from small stones which might damage aircraft propellers or jet aircraft;</P>
                                <P>(5) Operate mobile equipment according to the safety provisions of this clause, while actually performing work on the airfield. At all other times, the Contractor shall remove all mobile equipment to locations—</P>
                                <P>(i) Approved by the Contracting Officer;</P>
                                <P>(ii) At a distance of at least 750 feet from the runway centerline, plus any additional distance; and</P>
                                <P>(iii) Necessary to ensure compliance with the other provisions of this clause; and</P>
                                <P>(6) Not open a trench unless material is on hand and ready for placing in the trench. As soon as practicable after material has been placed and work approved, the Contractor shall backfill and compact trenches as required by the contract. Meanwhile, all hazardous conditions shall be marked and lighted in accordance with the other provisions of this clause.</P>
                                <P>
                                    (d) 
                                    <E T="03">Landing areas.</E>
                                     The Contractor shall—
                                    <PRTPAGE P="703"/>
                                </P>
                                <P>(1) Place nothing upon the landing areas without the authorization of the Contracting Officer;</P>
                                <P>(2) Outline those landing areas hazardous to aircraft, using (unless otherwise authorized by the Contracting Officer) red flags by day, and electric, battery-operated low-intensity red flasher lights by night;</P>
                                <P>(3) Obtain, at an airfield where flying is controlled, additional permission from the control tower operator every time before entering any landing area, unless the landing area is marked as hazardous in accordance with paragraph (d)(2) of this clause;</P>
                                <P>(4) Identify all vehicles it operates in landing areas by means of a flag on a staff attached to, and flying above, the vehicle. The flag shall be three feet square, and consist of a checkered pattern of international orange and white squares of 1 foot on each side (except that the flag may vary up to ten percent from each of these dimensions);</P>
                                <P>(5) Mark all other equipment and materials in the landing areas, using the same marking devices as in paragraph (d)(2) of this clause; and</P>
                                <P>(6) Perform work so as to leave that portion of the landing area which is available to aircraft free from hazards, holes, piles of material, and projecting shoulders that might damage an airplane tire.</P>
                                <P>
                                    (e) 
                                    <E T="03">Safety precaution areas.</E>
                                     The Contractor shall—
                                </P>
                                <P>(1) Place nothing upon the safety precaution areas without authorization of the Contracting Officer;</P>
                                <P>(2) Mark all equipment and materials in safety precaution areas, using (unless otherwise authorized by the Contracting Officer) red flags by day, and electric, battery-operated, low-intensity red flasher lights by night; and</P>
                                <P>(3) Provide all objects placed in safety precaution areas with a red light or red lantern at night, if the objects project above the approach-departure clearance surface or above the transitional surface.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.236-7006</SECTNO>
                            <SUBJECT>Cost limitation.</SUBJECT>
                            <P>As prescribed in 236.570(b)(4), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Cost Limitation (JAN 1997)</HD>
                                <P>(a) Certain items in this solicitation are subject to statutory cost limitations. The limitations are stated in the Schedule.</P>
                                <P>(b) An offer which does not state separate prices for the items identified in the Schedule as subject to a cost limitation may be considered nonresponsive.</P>
                                <P>(c) Prices stated in offers for items subject to cost limitations shall include an appropriate apportionment of all costs, direct and indirect, overhead, and profit.</P>
                                <P>(d) Offers may be rejected which—</P>
                                <P>(1) Are materially unbalanced for the purpose of bringing items within cost limitations; or</P>
                                <P>(2) Exceed the cost limitations, unless the limitations have been waived by the Government prior to award.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 62 FR 2615, Jan. 17, 1997]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.236-7007</SECTNO>
                            <SUBJECT>Additive or deductive items.</SUBJECT>
                            <P>As prescribed in 236.570(b)(5), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Additive or Deductive Items (DEC 1991)</HD>
                                <P>(a) The low offeror and the items to be awarded shall be determined as follows—</P>
                                <P>(1) Prior to the opening of bids, the Government will determine the amount of funds available for the project.</P>
                                <P>(2) The low offeror shall be the Offeror that—</P>
                                <P>(i) Is otherwise eligible for award; and</P>
                                <P>(ii) Offers the lowest aggregate amount for the first or base bid item, plus or minus (in the order stated in the list of priorities in the bid schedule) those additive or deductive items that provide the most features within the funds determined available.</P>
                                <P>(3) The Contracting Officer shall evaluate all bids on the basis of the same additive or deductive items.</P>
                                <P>(i) If adding another item from the bid schedule list of priorities would make the award exceed the available funds for all offerors, the Contracting Officer will skip that item and go to the next item from the bid schedule of priorities; and</P>
                                <P>(ii) Add that next item if an award may be made that includes that item and is within the available funds.</P>
                                <P>(b) The Contracting Officer will use the list of priorities in the bid schedule only to determine the low offeror. After determining the low offeror, an award may be made on any combination of items if—</P>
                                <P>(1) It is in the best interest of the Government;</P>
                                <P>(2) Funds are available at the time of award; and</P>
                                <P>(3) The low offeror's price for the combination to be awarded is less than the price offered by any other responsive, responsible offeror.</P>
                                <P>
                                    (c) 
                                    <E T="03">Example.</E>
                                     The amount available is $100,000. Offeror A's base bid and four additives (in the order stated in the list of priorities in the bid Schedule) are $85,000, $10,000, $8,000, $6,000, and $4,000. Offeror B's base bid and four additives are $80,000, $16,000, $9,000, $7,000, and $4,000. Offeror A is the low offeror. The aggregate amount of offeror A's bid for 
                                    <PRTPAGE P="704"/>
                                    purposes of award would be $99,000, which includes a base bid plus the first and fourth additives. The second and third additives were skipped because each of them would cause the aggregate bid to exceed $100,000.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.236-7008</SECTNO>
                            <SUBJECT>Contract prices—bidding schedules.</SUBJECT>
                            <P>As prescribed in 236.570(b)(6), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Contract Prices—Bidding Schedules (DEC 1991)</HD>
                                <P>(a) The Government's payment for the items listed in the Bidding Schedule shall constitute full compensation to the Contractor for—</P>
                                <P>(1) Furnishing all plant, labor, equipment, appliances, and materials; and</P>
                                <P>(2) Performing all operations required to complete the work in conformity with the drawings and specifications.</P>
                                <P>(b) The Contractor shall include in the prices for the items listed in the Bidding Schedule all costs for work in the specifications, whether or not specifically listed in the Bidding Schedule.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.236-7009</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.236-7010</SECTNO>
                            <SUBJECT>Overseas military construction—Preference for United States firms.</SUBJECT>
                            <P>As prescribed in 236.570(c)(1), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Overseas Military Construction—Preference for United States Firms (JAN 1997)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition.</E>
                                     “United States firm,” as used in this provision, means a firm incorporated in the United States that complies with the following:
                                </P>
                                <P>(1) The corporate headquarters are in the United States;</P>
                                <P>(2) The firm has filed corporate and employment tax returns in the United States for a minimum of 2 years (if required), has filed State and Federal income tax returns (if required) for 2 years, and has paid any taxes due as a result of these filings; and</P>
                                <P>(3) The firm employs United States citizens in key management positions.</P>
                                <P>
                                    (b) 
                                    <E T="03">Evaluation.</E>
                                     Offers from firms that do not qualify as United States firms will be evaluated by adding 20 percent to the offer.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Status.</E>
                                     The offeror ______ is, ______ is not a United States firm.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[62 FR 2857, Jan. 17, 1997, as amended at 63 FR 11549, Mar. 9, 1998]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.236-7011</SECTNO>
                            <SUBJECT>Overseas architect-engineer services—Restriction to United States firms.</SUBJECT>
                            <P>As prescribed in 236.609-70, use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Overseas Architect-Engineer Services—Restriction to United States Firms (JAN 1997)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition. United States firm,</E>
                                     as used in this provision, means a firm incorporated in the United States that complies with the following:
                                </P>
                                <P>(1) The corporate headquarters are in the United States;</P>
                                <P>(2) The firm has filed corporate and employment tax returns in the United States for a minimum of 12 years (if required), has filed State and Federal income tax returns (if required) for 2 years, and has paid any taxes due as a result of these filings; and</P>
                                <P>(3) The firm employs United States citizens in key management positions.</P>
                                <P>
                                    (b) 
                                    <E T="03">Restriction.</E>
                                     Military construction appropriations acts restrict award of a contract, resulting from this solicitation, to a United States firm or a joint venture of United States and host nation firms.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Status.</E>
                                     The offeror confirms, by submission of its offer, that it is a United States firm or a joint venture of United States and host nation firms.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[62 FR 2858, Jan. 17, 1997, as amended at 83 FR 54681, Oct. 31, 2018]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.236-7012</SECTNO>
                            <SUBJECT>Military construction on Kwajalein Atoll—evaluation preference.</SUBJECT>
                            <P>As prescribed in 236.570(c)(2), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Military Construction on Kwajalein Atoll—Evaluation Preference (MAR 1998)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this provision—
                                </P>
                                <P>
                                    (1) 
                                    <E T="03">Marshallese firm</E>
                                     means a local firm incorporated in the Marshall Islands, or otherwise legally organized under the laws of the Marshall Islands, that—
                                </P>
                                <P>(i) Is more than 50 percent owned by citizens of the Marshall Islands; or</P>
                                <P>(ii) Complies with the following:</P>
                                <P>
                                    (A) The firm has done business in the Marshall Islands on a continuing basis for not less than 3 years prior to the date of issuance of this solicitation;
                                    <PRTPAGE P="705"/>
                                </P>
                                <P>(B) Substantially all of the firm's directors of local operations, senior staff, and operating personnel are resident in the Marshall Islands or are U.S. citizens; and</P>
                                <P>(C) Most of the operating equipment and physical plant are in the Marshall Islands.</P>
                                <P>
                                    (2) 
                                    <E T="03">United States firm</E>
                                     means a firm incorporated in the United States that complies with the following:
                                </P>
                                <P>(i) The corporate headquarters are in the United States;</P>
                                <P>(ii) The firm has filed corporate and employment tax returns in the United States for a minimum of 2 years (if required), has filed State and Federal income tax returns (if required) for 2 years, and has paid any taxes due as a result of these filings; and</P>
                                <P>(iii) The firm employs United States citizens in key management positions.</P>
                                <P>
                                    (b) 
                                    <E T="03">Evaluation.</E>
                                     Offers from firms that do not qualify as United States firms or Marshallese firms will be evaluated by adding 20 percent to the offer, unless application of the factor would not result in award to a United States firm.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Status.</E>
                                     The offeror is ________ a United States firm; ________ a Marshallese firm; ________ Other.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[63 FR 11549, Mar. 9, 1998]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.236-7013</SECTNO>
                            <SUBJECT>Requirement for Competition Opportunity for American Steel Producers, Fabricators, and Manufacturers.</SUBJECT>
                            <P>As prescribed in 236.570(d), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Requirement for Competition Opportunity for American Steel Producers, Fabricators, and Manufacturers (JAN 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition. Construction material,</E>
                                     as used in this clause, means an article, material, or supply brought to the construction site by the Contractor or a subcontractor for incorporation into the building or work.
                                </P>
                                <P>(b) The Contractor shall provide American steel producers, fabricators, and manufacturers the opportunity to compete when acquiring steel as a construction material (e.g., steel beams, rods, cables, plates).</P>
                                <P>(c) The Contractor shall insert the substance of this clause, including this paragraph (c), in any subcontract that involves the acquisition of steel as a construction material, including subcontracts for the acquisition of commercial products.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[74 FR 2418, Jan. 15, 2009, as amended at 78 FR 37990, June 25, 2013; 88 FR 6596, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.237-7000</SECTNO>
                            <SUBJECT>Notice of special standards of responsibility.</SUBJECT>
                            <P>As prescribed in 237.270(e)(1), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Notice of Special Standards of Responsibility (DEC 1991)</HD>
                                <P>(a) To be determined responsible, the Offeror must meet the general standards of responsibility set forth at FAR 9.104-1 and the following criteria, as described in Chapter 3, General Standards, of “Government Auditing Standards.”</P>
                                <P>(1) Qualifications;</P>
                                <P>(2) Independence; and</P>
                                <P>(3) Quality Control.</P>
                                <P>(b) “Government Auditing Standards” is issued by the Comptroller General of the United States and is available for sale from the: Superintendent of Documents, U.S. Government Printing Office. Washington, DC 20401, Stock number 020-000-00243-3.</P>
                                <P>(c) The apparently successful Offeror, before award, shall give the Contracting Officer evidence that it is licensed by the cognizant licensing authority in the state or other political jurisdiction where the Offeror operates its professional practice.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 66 FR 49861, Oct. 1, 2001; 87 FR 65501, Oct. 28, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.237-7001</SECTNO>
                            <SUBJECT>Compliance with audit standards.</SUBJECT>
                            <P>As prescribed in 237.270(e)(2), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Compliance With Audit Standards (MAY 2000)</HD>
                                <P>The Contractor, in performance of all audit services under this contract, shall comply with “Government Auditing Standards” issued by the Comptroller General of the United States.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[65 FR 32041, May 22, 2000, as amended at 87 FR 65501, Oct. 28, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.237-7002</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.237-7003</SECTNO>
                            <SUBJECT>Requirements.</SUBJECT>
                            <P>As prescribed in 237.7003(a) and (a)(1), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Requirements (DEC 1991)</HD>
                                <P>
                                    (a) Except as provided in paragraphs (c) and (d) of this clause, the Government will 
                                    <PRTPAGE P="706"/>
                                    order from the Contractor all of its requirements in the area of performance for the supplies and services listed in the schedule of this contract.
                                </P>
                                <P>(b) Each order will be issued as a delivery order and will list—</P>
                                <P>(1) The supplies or services being ordered;</P>
                                <P>(2) The quantities to be furnished;</P>
                                <P>(3) Delivery or performance dates;</P>
                                <P>(4) Place of delivery or performance;</P>
                                <P>(5) Packing and shipping instructions;</P>
                                <P>(6) The address to send invoices; and</P>
                                <P>(7) The funds from which payment will be made.</P>
                                <P>(c) The Government may elect not to order supplies and services under this contract in instances where the body is removed from the area for medical, scientific, or other reason.</P>
                                <P>(d) In an epidemic or other emergency, the contracting activity may obtain services beyond the capacity of the Contractor's facilities from other sources.</P>
                                <P>(e) Contracting Officers of the following activities may order services and supplies under this contract—</P>
                                <FP SOURCE="FP-DASH"/>
                                <FP SOURCE="FP-DASH"/>
                                <FP SOURCE="FP-DASH"/>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 71 FR 3416, Jan. 23, 2006; 84 FR 48505, Sept. 13, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.237-7004</SECTNO>
                            <SUBJECT>Area of performance.</SUBJECT>
                            <P>As prescribed in 237.7003(a) and (a)(2), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Area of Performance (DEC 1991)</HD>
                                <P>(a) The area of performance is as specified in the contract.</P>
                                <P>(b) The Contractor shall take possession of the remains at the place where they are located, transport them to the Contractor's place of preparation, and later transport them to a place designated by the Contracting Officer.</P>
                                <P>(c) The Contractor will not be reimbursed for transportation when both the place where the remains were located and the delivery point are within the area of performance.</P>
                                <P>(d) If remains are located outside the area of performance, the Contracting Officer may place an order with the Contractor under this contract or may obtain the services elsewhere. If the Contracting Officer requires the Contractor to transport the remains into the area of performance, the Contractor shall be paid the amount per mile in the schedule for the number of miles required to transport the remains by a reasonable route from the point where located to the boundary of the area of performance.</P>
                                <P>(e) The Contracting Officer may require the Contractor to deliver remains to any point within 100 miles of the area of performance. In this case, the Contractor shall be paid the amount per mile in the schedule for the number of miles required to transport the remains by a reasonable route from the boundary of the area of performance to the delivery point.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 71 FR 3416, Jan. 23, 2006; 84 FR 48505, Sept. 13, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.237-7005</SECTNO>
                            <SUBJECT>Performance and delivery.</SUBJECT>
                            <P>As prescribed in 237.7003(a) and (a)(3), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Performance and Delivery (DEC 1991)</HD>
                                <P>(a) The Contractor shall furnish the material ordered and perform the services specified as promptly as possible but not later than 36 hours after receiving notification to remove the remains, excluding the time necessary for the Government to inspect and check results of preparation.</P>
                                <P>(b) The Government may, at no additional charge, require the Contractor to hold the remains for an additional period not to exceed 72 hours from the time the remains are casketed and final inspection completed.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 71 FR 3416, Jan. 23, 2006; 84 FR 48505, Sept. 13, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.237-7006</SECTNO>
                            <SUBJECT>Subcontracting.</SUBJECT>
                            <P>As prescribed in 237.7003(a) and (a)(4), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Subcontracting (DEC 1991)</HD>
                                <P>The Contractor shall not subcontract any work under this contract without the Contracting Officer's written approval. This clause does not apply to contracts of employment between the Contractor and its personnel.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 71 FR 3416, Jan. 23, 2006; 84 FR 48505, Sept. 13, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.237-7007</SECTNO>
                            <SUBJECT>Termination for default.</SUBJECT>
                            <P>As prescribed in 237.7003(a) and (a)(5), use the following clause:</P>
                            <EXTRACT>
                                <PRTPAGE P="707"/>
                                <HD SOURCE="HD1">Termination for Default (DEC 1991)</HD>
                                <P>(a) This clause supplements and is in addition to the Default clause of this contract.</P>
                                <P>(b) The Contracting Officer may terminate this contract for default by written notice without the ten day notice required by paragraph (a)(2) of the Default clause if—</P>
                                <P>(1) The Contractor, through circumstances reasonably within its control or that of its employees, performs any act under or in connection with this contract, or fails in the performance of any service under this contract and the act or failures may reasonably be considered to reflect discredit upon the Department of Defense in fulfilling its responsibility for proper care of remains;</P>
                                <P>(2) The Contractor, or its employees, solicits relatives or friends of the deceased to purchase supplies or services not under this contract. (The Contractor may furnish supplies or arrange for services not under this contract, only if representatives of the deceased voluntarily request, select, and pay for them.);</P>
                                <P>(3) The services or any part of the services are performed by anyone other than the Contractor or the Contractor's employees without the written authorization of the Contracting Officer;</P>
                                <P>(4) The Contractor refuses to perform the services required for any particular remains; or</P>
                                <P>(5) The Contractor mentions or otherwise uses this contract in its advertising in any way.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 71 FR 3416, Jan. 23, 2006; 84 FR 48505, Sept. 13, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.237-7008</SECTNO>
                            <SUBJECT>Group interment.</SUBJECT>
                            <P>As prescribed in 237.7003(a) and (a)(6), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Group Interment (DEC 1991)</HD>
                                <P>The Government will pay the Contractor for supplies and services provided for remains interred as a group on the basis of the number of caskets furnished, rather than on the basis of the number of persons in the group.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 71 FR 3416, Jan. 23, 2006; 84 FR 48506, Sept. 13, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.237-7009</SECTNO>
                            <SUBJECT>Permits.</SUBJECT>
                            <P>As prescribed in 237.7003(a) and (a)(7), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Permits (DEC 1991)</HD>
                                <P>The Contractor shall meet all State and local licensing requirements and obtain and furnish all necessary health department and shipping permits at no additional cost to the Government. The Contractor shall ensure that all necessary health department permits are in order for disposition of the remains.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 71 FR 3416, Jan. 23, 2006; 84 FR 48505, Sept. 13, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.237-7010</SECTNO>
                            <SUBJECT>Prohibition on Interrogation of Detainees by Contractor Personnel.</SUBJECT>
                            <P>As prescribed in 237.173-5, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Prohibition on Interrogation of Detainees by Contractor Personnel (JAN 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Detainee</E>
                                     means any person captured, detained, held, or otherwise under the effective control of DoD personnel (military or civilian) in connection with hostilities. This includes, but is not limited to, enemy prisoners of war, civilian internees, and retained personnel. This does not include DoD personnel or DoD contractor personnel being held for law enforcement purposes.
                                </P>
                                <P>
                                    <E T="03">Interrogation of detainees</E>
                                     means a systematic process of formally and officially questioning a detainee for the purpose of obtaining reliable information to satisfy foreign intelligence collection requirements.
                                </P>
                                <P>(b) Contractor personnel shall not interrogate detainees.</P>
                                <P>(c) Subcontracts. The Contractor shall include the substance of this clause, including this paragraph (c), in all subcontracts, including subcontracts for commercial services, that may require subcontractor personnel to interact with detainees in the course of their duties.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[75 FR 67634, Nov. 3, 2010, as amended at 78 FR 37991, June 25, 2013; 88 FR 6596, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.237-7011</SECTNO>
                            <SUBJECT>Preparation history.</SUBJECT>
                            <P>As prescribed in 237.7003(a) and (a)(8), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Preparation History (DEC 1991)</HD>
                                <P>
                                    For each body prepared, or for each casket handled in a group interment, the Contractor shall state briefly the results of the 
                                    <PRTPAGE P="708"/>
                                    embalming process on a certificate furnished by the Contracting Officer.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 71 FR 3416, Jan. 23, 2006; 84 FR 48505, Sept. 13, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.237-7012</SECTNO>
                            <SUBJECT>Instruction to offerors (count-of-articles).</SUBJECT>
                            <P>As prescribed in 237.7101(a), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Instruction to Offerors (Count-of-Articles) (DEC 1991)</HD>
                                <P>(a) The Offeror shall include unit prices for each item in a lot. Unit prices shall include all costs to the Government of providing the services, including pickup and delivery charges.</P>
                                <P>(b) Failure to offer on any item in a lot shall be cause for rejection of the offer on that lot. The Contracting Officer will evaluate offers based on the estimated quantities in the solicitation.</P>
                                <P>(c) Award generally will be made to a single offeror for all lots. However, the Contracting Officer may award by individual lot when it is more advantageous to the Government.</P>
                                <P>(d) Prospective offerors may inspect the types of articles to be serviced. Contact the Contracting Officer to make inspection arrangements.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 71 FR 3416, Jan. 23, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.237-7013</SECTNO>
                            <SUBJECT>Instruction to offerors (bulk weight).</SUBJECT>
                            <P>As prescribed in 237.7101(b), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Instruction to Offerors (Bulk Weight) (DEC 1991)</HD>
                                <P>(a) Offers shall be submitted on a unit price per pound of serviced laundry. Unit prices shall include all costs to the Government of providing the service, including pickup and delivery charges.</P>
                                <P>(b) The Contracting Officer will evaluate bids based on the estimated pounds of serviced laundry stated in the solicitation.</P>
                                <P>(c) Award generally will be made to a single offeror for all lots. However, the Contracting Officer may award by individual lot when it is more advantageous to the Government.</P>
                                <P>(d) Prospective offerors may inspect the types of articles to be serviced. Contact the Contracting Officer to make inspection arrangements.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 71 FR 3416, Jan. 23, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.237-7014</SECTNO>
                            <SUBJECT>Loss or damage (count-of-articles).</SUBJECT>
                            <P>As prescribed in 237.7101(c), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Loss or Damage (Count-of-Articles) (DEC 1991)</HD>
                                <P>(a) The count-of-articles will be—</P>
                                <P>(1) The count of the Contracting Officer; or</P>
                                <P>(2) The count agreed upon as a result of a joint count by the Contractor and the Contracting Officer at the time of delivery to the Contractor.</P>
                                <P>(b) The Contractor shall—</P>
                                <P>(1) Be liable for return of the number and kind of articles furnished for service under this contract; and</P>
                                <P>(2) Shall indemnify the Government for any loss or damage to such articles.</P>
                                <P>(c) The Contractor shall pay to the Government the value of any lost or damaged property using Federal supply schedule price lists. If the property is not on these price lists, the Contracting Officer shall determine a fair and reasonable price.</P>
                                <P>(d) The Contracting Officer will allow credit for any depreciation in the value of the property at the time of loss or damage. The Contracting Officer and the Contractor shall mutually determine the amount of the allowable credit.</P>
                                <P>(e) Failure to agree upon the value of the property or on the amount of credit due will be treated as a dispute under the Disputes clause of this contract.</P>
                                <P>(f) In case of damage to any property that the Contracting Officer and the Contractor agree can be satisfactorily repaired, the Contractor may repair the property at its expense in a manner satisfactory to the Contracting Officer, rather than make payment under paragraph (c) of this clause.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 71 FR 3416, Jan. 23, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.237-7015</SECTNO>
                            <SUBJECT>Loss or damage (weight of articles).</SUBJECT>
                            <P>As prescribed in 237.7101(d), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Loss or Damage (Weight of Articles) (DEC 1991)</HD>
                                <P>(a) The Contractor shall—</P>
                                <P>
                                    (1) Be liable for return of the articles furnished for service under this contract; and
                                    <PRTPAGE P="709"/>
                                </P>
                                <P>(2) Indemnify the Government for any articles delivered to the Contractor for servicing under this contract that are lost or damaged, and in the opinion of the Contracting Officer, cannot be repaired satisfactorily.</P>
                                <P>(b) The Contractor shall pay to the Government ________ per pound for lost or damaged articles. The Contractor shall pay the Government only for losses which exceed the maximum weight loss in paragraph (e) of this clause.</P>
                                <P>(c) Failure to agree on the amount of credit due will be treated as a dispute under the Disputes clause of this contract.</P>
                                <P>(d) In the case of damage to any articles that the Contracting Officer and the Contractor agree can be satisfactorily repaired, the Contractor shall repair the articles at its expense in a manner satisfactory to the Contracting Officer.</P>
                                <P>(e) The maximum weight loss allowable in servicing the laundry is ________ percent of the weight recorded on delivery tickets when the laundry is picked up. Any weight loss in excess of this amount shall be subject to the loss provisions of this clause.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 71 FR 3416, Jan. 23, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.237-7016</SECTNO>
                            <SUBJECT>Delivery tickets.</SUBJECT>
                            <P>
                                <E T="03">Basic.</E>
                                 As prescribed in 237.7101(e) and (e)(1), use the following clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Delivery Tickets—Basic (NOV 2014)</HD>
                                <P>(a) The Contractor shall complete delivery tickets in the number of copies required and in the form approved by the Contracting Officer, when it receives the articles to be serviced.</P>
                                <P>(b) The Contractor shall include one copy of each delivery ticket with its invoice for payment.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate I.</E>
                                 As prescribed in 237.7101(e) and (e)(2), use the following clause, which includes paragraphs (c), (d), and (e) not included in the basic clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Delivery Tickets—Alternate I (NOV 2014)</HD>
                                <P>(a) The Contractor shall complete delivery tickets in the number of copies required and in the form approved by the Contracting Officer, when it receives the articles to be serviced.</P>
                                <P>(b) The Contractor shall include one copy of each delivery ticket with its invoice for payment.</P>
                                <P>(c) Before the Contractor picks up articles for service under this contract, the Contracting Officer will ensure that—</P>
                                <P>(1) Each bag contains only articles within a single bag type as specified in the schedule; and</P>
                                <P>(2) Each bag is weighed and the weight and bag type are identified on the bag.</P>
                                <P>(d) The Contractor shall, at time of pickup—</P>
                                <P>(1) Verify the weight and bag type and record them on the delivery ticket; and</P>
                                <P>(2) Provide the Contracting Officer, or representative, a copy of the delivery ticket.</P>
                                <P>(e) At the time of delivery, the Contractor shall record the weight and bag type of serviced laundry on the delivery ticket. The Contracting Officer will ensure that this weight and bag type are verified at time of delivery.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate II.</E>
                                 As prescribed in 237.7101(e) and (e)(3), use the following clause, which includes paragraphs (c), (d), and (e) not included in the basic clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Delivery Tickets—Alternate II (NOV 2014)</HD>
                                <P>(a) The Contractor shall complete delivery tickets in the number of copies required and in the form approved by the Contracting Officer, when it receives the articles to be serviced.</P>
                                <P>(b) The Contractor shall include one copy of each delivery ticket with its invoice for payment.</P>
                                <P>(c) Before the Contractor picks up articles for service under this contract, the Contracting Officer will ensure that each bag is weighed and that the weight is identified on the bag.</P>
                                <P>(d) The Contractor, at time of pickup, shall verify and record the weight on the delivery ticket and shall provide the Contracting Officer, or representative, a copy of the delivery ticket.</P>
                                <P>(e) At the time of delivery, the Contractor shall record the weight of serviced laundry on the delivery ticket. The Contracting Officer will ensure that this weight is verified at time of delivery.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 71 FR 3416, Jan. 23, 2006; 79 FR 65594, Nov. 5, 2014; 80 FR 36900, June 26, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.237-7017</SECTNO>
                            <SUBJECT>Individual laundry.</SUBJECT>
                            <P>As prescribed in 237.7101(f), use the following clause:</P>
                            <EXTRACT>
                                <PRTPAGE P="710"/>
                                <HD SOURCE="HD1">Individual Laundry (DEC 1991)</HD>
                                <P>(a) The Contractor shall provide laundry service under this contract on both a unit bundle and on a piece-rate bundle basis for individual personnel.</P>
                                <P>(b) The total number of pieces listed in the “Estimated Quantity” column in the schedule is the estimated amount of individual laundry for this contract. The estimate is for information only and is not a representation of the amount of individual laundry to be ordered. Individuals may elect whether or not to use the laundry services.</P>
                                <P>(c) Charges for individual laundry will be on a per unit bundle or a piece-rate basis. The Contractor shall provide individual laundry bundle delivery tickets for use by the individuals in designating whether the laundry is a unit bundle or a piece-rate bundle. An individual laundry bundle will be accompanied by a delivery ticket listing the contents of the bundle.</P>
                                <P>(d) The maximum number of pieces to be allowed per bundle is as specified in the schedule and as follows—</P>
                                <P>
                                    (1) 
                                    <E T="03">Bundle consisting of 26 pieces, including laundry bag.</E>
                                     This bundle will contain approximately ________ pieces of outer garments which shall be starched and pressed. Outer garments include, but are not limited to, shirts, trousers, jackets, dresses, and coats.
                                </P>
                                <P>
                                    (2) 
                                    <E T="03">Bundle consisting of 13 pieces, including laundry bag.</E>
                                     This bundle will contain approximately ________ pieces of outer garments which shall be starched and pressed. Outer garments include, but are not limited to, shirts, trousers, jackets, dresses, and coats.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 71 FR 3416, Jan. 23, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.237-7018</SECTNO>
                            <SUBJECT>Special definitions of Government property.</SUBJECT>
                            <P>As prescribed in 237.7101(g), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Special Definitions of Government Property (DEC 1991)</HD>
                                <P>Articles delivered to the Contractor to be laundered or dry-cleaned, including any articles which are actually owned by individual Government personnel, are Government-owned property, not Government-furnished property. Government-owned property does not fall under the requirements of any Government-furnished property clause of this contract.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 71 FR 3416, Jan. 23, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.237-7019</SECTNO>
                            <SUBJECT>Training for Contractor Personnel Interacting with Detainees.</SUBJECT>
                            <P>As prescribed in 237.171-4, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Training for Contractor Personnel Interacting With Detainees (JAN 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Combatant Commander</E>
                                     means the commander of a unified or specified combatant command established in accordance with 10 U.S.C. 161.
                                </P>
                                <P>
                                    <E T="03">Detainee</E>
                                     means a person in the custody or under the physical control of the Department of Defense on behalf of the United States Government as a result of armed conflict or other military operation by United States armed forces.
                                </P>
                                <P>
                                    <E T="03">Personnel interacting with detainees</E>
                                     means personnel who, in the course of their duties, are expected to interact with detainees.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Training requirement.</E>
                                     This clause implements Section 1092 of the National Defense Authorization Act for Fiscal Year 2005 (Pub. L. 108-375).
                                </P>
                                <P>(1) The Combatant Commander responsible for the area where a detention or interrogation facility is located will arrange for training to be provided to contractor personnel interacting with detainees. The training will address the international obligations and laws of the United States applicable to the detention of personnel, including the Geneva Conventions. The Combatant Commander will arrange for a training receipt document to be provided to personnel who have completed the training.</P>
                                <P>(2)(i) The Contractor shall arrange for its personnel interacting with detainees to—</P>
                                <P>(A) Receive the training specified in paragraph (b)(1) of this clause—</P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) Prior to interacting with detainees, or as soon as possible if, for compelling reasons, the Contracting Officer authorizes interaction with detainees prior to receipt of such training; and
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) Annually thereafter; and
                                </P>
                                <P>(B) Provide a copy of the training receipt document specified in paragraph (b)(1) of this clause to the Contractor for retention.</P>
                                <P>(ii) To make these arrangements, the following points of contact apply:</P>
                                <P>
                                    <E T="03">[Contracting Officer to insert applicable point of contact information cited in PGI 237.171-3(b).]</E>
                                </P>
                                <P>
                                    (3) The Contractor shall retain a copy of the training receipt document(s) provided in accordance with paragraphs (b)(1) and (2) of this clause until the contract is closed, or 3 
                                    <PRTPAGE P="711"/>
                                    years after all work required by the contract has been completed and accepted by the Government, whichever is sooner.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Subcontracts.</E>
                                     The Contractor shall include the substance of this clause, including this paragraph (c), in all subcontracts, including subcontracts for commercial services, that may require subcontractor personnel to interact with detainees in the course of their duties.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[70 FR 52034, Sept. 1, 2005, as amended at 71 FR 53049, Sept. 8, 2006; 78 FR 37991, June 25, 2013; 88 FR 6596, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.237-7020—252.237-7021</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.237-7022</SECTNO>
                            <SUBJECT>Services at installations being closed.</SUBJECT>
                            <P>As prescribed in 237.7402, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Services at Installations Being Closed (MAY 1995)</HD>
                                <P>Professional employees shall be used by the local government to provide services under this contract to the extent that professionals are available in the area under the jurisdiction of such government.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[59 FR 36090, July 15, 1994, as amended at 60 FR 29503, June 5, 1995]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.237-7023</SECTNO>
                            <SUBJECT>Continuation of Essential Contractor Services.</SUBJECT>
                            <P>As prescribed in 237.7603(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Continuation of Essential Contractor Services (OCT 2010)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause-
                                </P>
                                <P>
                                    (1) 
                                    <E T="03">Essential contractor service</E>
                                     means a service provided by a firm or individual under contract to DoD to support mission-essential functions, such as support of vital systems, including ships owned, leased, or operated in support of military missions or roles at sea; associated support activities, including installation, garrison, and base support services; and similar services provided to foreign military sales customers under the Security Assistance Program. Services are essential if the effectiveness of defense systems or operations has the potential to be seriously impaired by the interruption of these services, as determined by the appropriate functional commander or civilian equivalent.
                                </P>
                                <P>
                                    (2) 
                                    <E T="03">Mission-essential functions</E>
                                     means those organizational activities that must be performed under all circumstances to achieve DoD component missions or responsibilities, as determined by the appropriate functional commander or civilian equivalent. Failure to perform or sustain these functions would significantly affect DoD's ability to provide vital services or exercise authority, direction, and control.
                                </P>
                                <P>(b) The Government has identified all or a portion of the contractor services performed under this contract as essential contractor services in support of mission-essential functions. These services are listed in attachment __, Mission-Essential Contractor Services, dated ________.</P>
                                <P>(c)(1) The Mission-Essential Contractor Services Plan submitted by the Contractor, is incorporated in this contract.</P>
                                <P>(2) The Contractor shall maintain and update its plan as necessary. The Contractor shall provide all plan updates to the Contracting Officer for approval.</P>
                                <P>(3) As directed by the Contracting Officer, the Contractor shall participate in training events, exercises, and drills associated with Government efforts to test the effectiveness of continuity of operations procedures and practices.</P>
                                <P>(d)(1) Notwithstanding any other clause of this contract, the Contractor shall be responsible to perform those services identified as essential contractor services during crisis situations (as directed by the Contracting Officer), in accordance with its Mission-Essential Contractor Services Plan.</P>
                                <P>(2) In the event the Contractor anticipates not being able to perform any of the essential contractor services identified in accordance with paragraph (b) of this clause during a crisis situation, the Contractor shall notify the Contracting Officer or other designated representative as expeditiously as possible and use its best efforts to cooperate with the Government in the Government's efforts to maintain the continuity of operations.</P>
                                <P>(e) The Government reserves the right in such crisis situations to use Federal employees, military personnel, or contract support from other contractors, or to enter into new contracts for essential contractor services.</P>
                                <P>
                                    (f) 
                                    <E T="03">Changes.</E>
                                     The Contractor shall segregate and separately identify all costs incurred in continuing performance of essential services in a crisis situation. The Contractor shall notify the Contracting Officer of an increase or decrease in costs within ninety days after continued performance has been directed by the Contracting Officer, or within any additional period that the Contracting Officer approves in writing, but not later than the date of final payment under the contract. The Contractor's notice shall include the Contractor's proposal for an equitable adjustment and any data supporting the increase or decrease in the form prescribed by the Contracting Officer. The parties shall negotiate an equitable price adjustment to the contract price, delivery schedule, or both as 
                                    <PRTPAGE P="712"/>
                                    soon as is practicable after receipt of the Contractor's proposal.
                                </P>
                                <P>(g) The Contractor shall include the substance of this clause, including this paragraph (g), in subcontracts for the essential services.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[75 FR 66682, Oct. 29, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.237-7024</SECTNO>
                            <SUBJECT>Notice of Continuation of Essential Contractor Services.</SUBJECT>
                            <P>As prescribed in 237.7603(b), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Notice of Continuation of Essential Contractor Services (OCT 2010)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions. Essential contractor service</E>
                                     and 
                                    <E T="03">mission-essential functions</E>
                                     have the meanings given in the clause at 252.237-7023, Continuation of Essential Contractor Services, in this solicitation.
                                </P>
                                <P>(b) The offeror shall provide with its offer a written plan describing how it will continue to perform the essential contractor services listed in attachment __, Mission Essential Contractor Services, dated ________, during periods of crisis. The offeror shall—</P>
                                <P>(1) Identify provisions made for the acquisition of essential personnel and resources, if necessary, for continuity of operations for up to 30 days or until normal operations can be resumed;</P>
                                <P>(2) Address in the plan, at a minimum—</P>
                                <P>(i) Challenges associated with maintaining essential contractor services during an extended event, such as a pandemic that occurs in repeated waves;</P>
                                <P>(ii) The time lapse associated with the initiation of the acquisition of essential personnel and resources and their actual availability on site;</P>
                                <P>(iii) The components, processes, and requirements for the identification, training, and preparedness of personnel who are capable of relocating to alternate facilities or performing work from home;</P>
                                <P>(iv) Any established alert and notification procedures for mobilizing identified “essential contractor service” personnel; and</P>
                                <P>(v) The approach for communicating expectations to contractor employees regarding their roles and responsibilities during a crisis.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[75 FR 66683, Oct. 29, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.237-7025</SECTNO>
                            <SUBJECT>Preaward Transparency Requirements for Firms Offering to Support Department of Defense Audits—Representation and Disclosure.</SUBJECT>
                            <P>As prescribed in 237.270(e)(3), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Preaward Transparency Requirements For Firms Offering To Support Department of Defense Audits—Representation and Disclosure (OCT 2022)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Representation.</E>
                                     The Offeror represents that within the 3-year period preceding this offer, the Offeror and/or any of its principals or employees have [ ] have not [ ] been the subject of disciplinary proceedings before an entity with the authority to enforce compliance with rules or laws applying to audit services or audit remediation services offered by the Offeror, that—
                                </P>
                                <P>(1) Are not yet fully adjudicated or settled; or</P>
                                <P>(2) Were fully adjudicated or settled against the Offeror and/or its principals or employees.</P>
                                <P>
                                    (b) 
                                    <E T="03">Disclosure.</E>
                                     If the Offeror checked “have” in the representation in paragraph (a) of this provision, the Offeror shall, at a minimum, disclose for each such proceeding—
                                </P>
                                <P>(1) The entity hearing the case;</P>
                                <P>(2) The case or file number; and</P>
                                <P>(3) The allegation or conduct at issue and, if fully adjudicated or settled, a brief description of the outcome.</P>
                                <P>
                                    (c) 
                                    <E T="03">Treatment of the statements.</E>
                                     The Government will safeguard and treat as confidential all statements provided pursuant to this provision where the statement has been marked “confidential” or “proprietary” by the Offeror. Statements so marked will not be released by the Government to the public pursuant to a request under the Freedom of Information Act, 5 U.S.C. 552, without prior notification to the Offeror and opportunity for the Offeror to claim an exemption from release. The Government will treat any statement provided pursuant to this provision as confidential to the extent required by any other applicable law.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[87 FR 65501, Oct. 28, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.237-7026</SECTNO>
                            <SUBJECT>Postaward Transparency Requirements for Firms that Support Department of Defense Audits.</SUBJECT>
                            <P>As prescribed in 237.270(e)(4), use the following clause:</P>
                            <EXTRACT>
                                <PRTPAGE P="713"/>
                                <HD SOURCE="HD1">Postaward Transparency Requirements for Firms That Support Department of Defense Audits (OCT 2022)</HD>
                                <P>(a) Prior to each contract action under this contract (including renewal or modification), the Contractor shall disclose the details of any disciplinary proceedings, with respect to the firm and/or its principals or employees, before an entity with the authority to enforce compliance with rules or laws applying to audit services or audit remediation services offered by the Contractor, and whether there has been any change with regard to previously reported proceedings since the last contract action.</P>
                                <P>(b) The disclosure shall, at a minimum, include—</P>
                                <P>(1) The entity hearing the case;</P>
                                <P>(2) The case or file number; and</P>
                                <P>(3) A brief description of the allegation or conduct at issue and, if fully adjudicated or settled, a brief description of the outcome.</P>
                                <P>(c) The Government will safeguard and treat as confidential all statements provided pursuant to this clause where the statement has been marked “confidential” or “proprietary” by the Contractor. Statements so marked will not be released by the Government to the public pursuant to a request under the Freedom of Information Act, 5 U.S.C. 552, without prior notification to the Contractor and opportunity for the Contractor to claim an exemption from release. The Government will treat any statement provided pursuant to this clause as confidential to the extent required by any other applicable law.</P>
                            </EXTRACT>
                            <FP>(End of clause)</FP>
                            <CITA>[87 FR 65502, Oct. 28, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.237-7027</SECTNO>
                            <SUBJECT>Transfer and Adoption of Military Animals.</SUBJECT>
                            <P>As prescribed in 237.7804, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Transfer and Adoption of Military Animals (FEB 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Contract working dog</E>
                                     means a dog that—
                                </P>
                                <P>(1) Performs a service for DoD pursuant to a contract; and</P>
                                <P>(2) Is trained and kenneled by an entity that provides such a dog pursuant to such a contract.</P>
                                <P>(b) In accordance with 10 U.S.C. 2387, if the Contracting Officer determines that the service life of a contract working dog has terminated, the dog will be transferred to the Department of the Air Force, 341st Training Squadron, for veterinary screening and care, reclassification as a military animal, and placement for adoption in accordance with 10 U.S.C. 2583.</P>
                                <P>(c) The service life of a contract working dog may be terminated if the Contracting Officer determines that—</P>
                                <P>(1) The final contractual obligation of the dog preceding transfer is with DoD; and</P>
                                <P>(2) The dog cannot be used by another department or agency of the Federal Government due to age, injury, or performance.</P>
                            </EXTRACT>
                            <FP>(End of clause)</FP>
                            <CITA>[89 FR 11747, Feb. 15, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.239-7000</SECTNO>
                            <SUBJECT>Protection against compromising emanations.</SUBJECT>
                            <P>As prescribed in 239.7103(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Protection Against Compromising Emanations (OCT 2019)</HD>
                                <P>(a) The Contractor shall provide or use only information technology, as specified by the Government, that has been accredited to meet the appropriate information assurance requirements of—</P>
                                <P>(1) The National Security Agency National TEMPEST Standards (NSTISSAM TEMPEST 1-92, Compromising Emanations Laboratory Test Requirements, Electromagnetics (U)); or</P>
                                <P>(2) Other standards specified by this contract, including the date through which the required accreditation is current or valid for the contract.</P>
                                <P>(b) Upon request of the Contracting Officer, the Contractor shall provide documentation supporting the accreditation.</P>
                                <P>(c) The Government may, as part of its inspection and acceptance, conduct additional tests to ensure that information technology delivered under this contract satisfies the information assurance standards specified. The Government may conduct additional tests—</P>
                                <P>(1) At the installation site or contractor's facility; and</P>
                                <P>(2) Notwithstanding the existence of valid accreditations of information technology prior to the award of this contract.</P>
                                <P>(d) Unless otherwise provided in this contract under the Warranty of Supplies or Warranty of Systems and Equipment clause, the Contractor shall correct or replace accepted information technology found to be deficient within 1 year after proper installations.</P>
                                <P>(1) The correction or replacement shall be at no cost to the Government.</P>
                                <P>(2) Should a modification to the delivered information technology be made by the Contractor, the 1-year period applies to the modification upon its proper installation.</P>
                                <P>(3) This paragraph (d) applies regardless of f.o.b. point or the point of acceptance of the deficient information technology.</P>
                            </EXTRACT>
                            <PRTPAGE P="714"/>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[69 FR 35535, June 25, 2004, as amended at 73 FR 1829, Jan. 10, 2008; 84 FR 58337, Oct. 31, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.239-7001</SECTNO>
                            <SUBJECT>Information Assurance Contractor Training and Certification.</SUBJECT>
                            <P>As prescribed in 239.7103(b), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Information Assurance Contractor Training and Certification (JAN 2008)</HD>
                                <P>(a) The Contractor shall ensure that personnel accessing information systems have the proper and current information assurance certification to perform information assurance functions in accordance with DoD 8570.01-M, Information Assurance Workforce Improvement Program. The Contractor shall meet the applicable information assurance certification requirements, including—</P>
                                <P>(1) DoD-approved information assurance workforce certifications appropriate for each category and level as listed in the current version of DoD 8570.01-M; and</P>
                                <P>(2) Appropriate operating system certification for information assurance technical positions as required by DoD 8570.01-M.</P>
                                <P>(b) Upon request by the Government, the Contractor shall provide documentation supporting the information assurance certification status of personnel performing information assurance functions.</P>
                                <P>(c) Contractor personnel who do not have proper and current certifications shall be denied access to DoD information systems for the purpose of performing information assurance functions.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[73 FR 1829, Jan. 10, 2008]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.239-7002</SECTNO>
                            <SUBJECT>Access.</SUBJECT>
                            <P>As prescribed in 239.7411(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Access (DEC 1991)</HD>
                                <P>(a) Subject to military security regulations, the Government shall permit the Contractor access at all reasonable times to Contractor furnished facilities. However, if the Government is unable to permit access, the Government at its own risk and expense shall maintain these facilities and the Contractor shall not be responsible for the service involving any of these facilities during the period of nonaccess, unless the service failure results from the Contractor's fault or negligence.</P>
                                <P>(b) During periods when the Government does not permit Contractor access, the Government will reimburse the Contractor at mutually acceptable rates for the loss of or damage to the equipment due to the fault or negligence of the Government. Failure to agree shall be a dispute concerning a question of fact within the meaning of the Disputes clause of this contract.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.239-7003</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.239-7004</SECTNO>
                            <SUBJECT>Orders for Facilities and Services.</SUBJECT>
                            <P>As prescribed in 239.7411(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">ORDERS FOR FACILITIES AND SERVICES (SEP 2019)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Governmental regulatory body</E>
                                     means the Federal Communications Commission, any statewide regulatory body, or any body with less than statewide jurisdiction when operating under the state authority. Regulatory bodies whose decisions are not subject to judicial appeal and regulatory bodies which regulate a company owned by the same entity that creates the regulatory body are not governmental regulatory bodies.
                                </P>
                                <P>(b) The Contractor shall acknowledge a communication service authorization or other type order for supplies and facilities by—</P>
                                <P>(1) Commencing performance after receipt of an order; or</P>
                                <P>(2) Written acceptance by a duly authorized representative.</P>
                                <P>(c) The Contractor shall furnish the services and facilities under this agreement/contract in accordance with all applicable tariffs, rates, charges, regulations, requirements, terms, and conditions of—</P>
                                <P>(1) Service and facilities furnished or offered by the Contractor to the general public or the Contractor's subscribers; or</P>
                                <P>(2) Service as lawfully established by a governmental regulatory body.</P>
                                <P>(d) The Government will not prepay for services.</P>
                                <P>(e) For nontariffed services, the Contractor shall charge the Government at the lowest rate and under the most favorable terms and conditions for similar service and facilities offered to any other customer.</P>
                                <P>(f) Recurring charges for services and facilities shall, in each case, start with the satisfactory beginning of service or provision of facilities or equipment and are payable monthly in arrears.</P>
                                <P>
                                    (g) Expediting charges are costs necessary to get services earlier than normal. Examples are overtime pay or special shipment. When authorized, expediting charges shall be 
                                    <PRTPAGE P="715"/>
                                    the additional costs incurred by the Contractor and the subcontractor. The Government shall pay expediting charges only when—
                                </P>
                                <P>(1) They are provided for in the tariff established by a governmental regulatory body; or</P>
                                <P>(2) They are authorized in a communication service authorization or other contractual document.</P>
                                <P>(h) When services normally provided are technically unacceptable and the development, fabrication, or manufacture of special equipment is required, the Government may—</P>
                                <P>(1) Provide the equipment; or</P>
                                <P>(2) Direct the Contractor to acquire the equipment or facilities. If the Contractor acquires the equipment or facilities, the acquisition shall be competitive, if practicable.</P>
                                <P>(i) If at any time the Government defers or changes its orders for any of the services but does not cancel or terminate them, the amount paid or payable to the Contractor for the services deferred or modified shall be equitably adjusted under applicable tariffs filed by the Contractor with the regulatory commission in effect at the time of deferral or change. If no tariffs are in effect, the Government and the Contractor shall equitably adjust the rates by mutual agreement. Failure to agree on any adjustment shall be a dispute concerning a question of fact within the meaning of the Disputes clause of this contract.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[84 FR 48499, Sept. 13, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.239-7005—252.239-7006</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.239-7007</SECTNO>
                            <SUBJECT>Cancellation or Termination of Orders.</SUBJECT>
                            <P>As prescribed in 239.7411(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD3">Cancellation or Termination of Orders (SEP 2019)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Actual nonrecoverable costs</E>
                                     means the installed costs of the facilities and equipment, less cost of reusable materials, and less net salvage value.
                                </P>
                                <P>
                                    <E T="03">Basic cancellation liability</E>
                                     means the actual nonrecoverable cost, which the Government shall reimburse the Contractor at the time services are cancelled.
                                </P>
                                <P>
                                    <E T="03">Basic termination liability</E>
                                     means the nonrecoverable cost amortized in equal monthly increments throughout the liability period.
                                </P>
                                <P>
                                    <E T="03">Installed costs</E>
                                     means the actual cost of equipment and materials specifically provided or used, plus the actual cost of installing (including engineering, labor, supervision, transportation, rights-of-way, and any other items which are chargeable to the capital accounts of the Contractor), less any costs the government may have directly reimbursed the Contractor under the Special Construction and Equipment Charges clause of this agreement/contract.
                                </P>
                                <P>
                                    <E T="03">Net salvage value</E>
                                     means the salvage value less the cost of removal.
                                </P>
                                <P>(b) If the Government cancels any of the services ordered under this agreement/contract, before the services are made available to the Government, or terminates any of these services after they are made available to the Government, the Government will reimburse the Contractor for the actual nonrecoverable costs the Contractor has reasonably incurred in providing facilities and equipment for which the Contractor has no foreseeable reuse. The Government will not reimburse the Contractor for any actual nonrecoverable costs incurred after notice of award, but prior to execution of the order.</P>
                                <P>(c) When feasible, the Contractor shall reuse cancelled or terminated facilities or equipment to minimize the charges to the Government.</P>
                                <P>(d) If at any time the Government requires that telecommunications facilities or equipment be relocated within the Contractor's service area, the Government will have the option of paying the costs of relocating the facilities or equipment in lieu of paying any termination or cancellation charge under this clause. The basic cancellation liability or basic termination liability applicable to the facilities or equipment in their former location shall continue to apply to the facilities and equipment in their new location. Monthly recurring charges shall continue to be paid during the period.</P>
                                <P>(e) When there is another requirement or foreseeable reuse in place of cancelled or terminated facilities or equipment, no charge shall apply and the basic cancellation liability or basic termination liability shall be appropriately reduced. When feasible, the Contractor shall promptly reuse discontinued channels or facilities, including equipment for which the Government is obligated to pay a minimum service charge.</P>
                                <P>(f) The amount of the Government's liability upon cancellation or termination of any of the services ordered under this agreement/contract will be determined under applicable tariffs governing cancellation and termination charges which—</P>
                                <P>(1) Are filed by the Contractor with a governmental regulatory body, as defined in the Orders For Facilities and Services clause of this agreement/contract;</P>
                                <P>(2) Are in effect on the date of termination; and</P>
                                <P>
                                    (3) Provide specific cancellation or termination charges for the facilities and equipment involved or show how to determine the charges.
                                    <PRTPAGE P="716"/>
                                </P>
                                <P>(g) The amount of the Government's liability upon cancellation or termination of any of the services ordered under this agreement/contract, which are not subject to a governmental regulatory body, will be determined under a mutually agreed schedule in the communication services authorization (CSA) or other contractual document.</P>
                                <P>(h) If no applicable tariffs are in effect on the date of cancellation or termination or set forth in the applicable CSA or other contractual document, the Government's liability will be determined under the following settlement procedures—</P>
                                <P>(1) The Contractor agrees to provide the Contracting Officer, in such reasonable detail as the Contracting Officer may require, inventory schedules covering all items of property or facilities in the Contractor's possession, the cost of which is included in the Basic Cancellation or Termination Liability for which the Contractor has no foreseeable reuse.</P>
                                <P>(2) The Contractor shall use its best efforts to sell property or facilities when the Contractor has no foreseeable reuse or when the Government has not exercised its option to take title under the Title to Telecommunications Facilities and Equipment clause of this agreement/contract. The Contractor shall apply any proceeds of the sale to reduce any payments by the Government to the Contractor under a cancellation or termination settlement.</P>
                                <P>(3) The Contractor shall record actual nonrecoverable costs under established accounting procedures prescribed by the cognizant governmental regulatory authority or, if no such procedures have been prescribed, under generally accepted accounting procedures applicable to the provision of telecommunication services for public use.</P>
                                <P>(4) The net salvage value shall be deducted from the Contractor's installed cost. In determining net salvage value, the Contractor shall consider the foreseeable reuse of the facilities and equipment by the Contractor. The Contractor shall make allowance for the cost of dismantling, removal, reconditioning, and disposal of the facilities and equipment when necessary either for the sale of facilities or their reuse by the Contractor in another location.</P>
                                <P>(5) Upon termination of services, the Government will reimburse the Contractor for the nonrecoverable cost less such costs amortized to the date services are terminated and establish the liability period as mutually agreed to but not to exceed ten years. In the case of either a cancellation or a termination, the Government's presumed maximum liability will be capped by the unpaid non-recurring charges and the monthly recurring charges set out in the contract/agreement. The presumed maximum liability for monthly recurring charges shall be capped at monthly recurring charges for the minimum service period and any required notice period.</P>
                                <P>(6) When the basic cancellation liability or basic termination liability established by the CSA or other contractual document is based on estimated costs, the Contractor agrees to settle on the basis of actual cost at the time of cancellation or termination.</P>
                                <P>(7) The Contractor agrees that, if after settlement but within the termination liability period of the services, should the Contractor make reuse of equipment or facilities which were treated as nonreusable or nonsalvable in the settlement, the Contractor shall reimburse the Government for the value of the equipment or facilities.</P>
                                <P>(8) The Contractor agrees to exclude—</P>
                                <P>(i) Any costs which are not included in determining cancellation and termination charges under the Contractor's standard practices or procedures; and</P>
                                <P>(ii) Charges not ordinarily made by the Contractor for similar facilities or equipment, furnished under similar circumstances.</P>
                                <P>(i) The Government may, under such terms and conditions as it may prescribe, make partial payments and payments on account against costs incurred by the Contractor in connection with the cancelled or terminated portion of this agreement/contract. The Government may make these payments if the Contracting Officer determines that the total of the payments is within the amount the Contractor is entitled. If the total of the payments is in excess of the amount finally agreed or determined to be due under this clause, the Contractor shall pay the excess to the Government upon demand.</P>
                                <P>(j) Failure to agree shall be a dispute concerning a question of fact within the meaning of the Disputes clause.</P>
                                <HD SOURCE="HD3">(End of clause)</HD>
                            </EXTRACT>
                            <CITA>[84 FR 48497, Sept. 13, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.239-7008</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.239-7009</SECTNO>
                            <SUBJECT>Representation of use of cloud computing.</SUBJECT>
                            <P>As prescribed in 239.7604(a), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Representation of Use of Cloud Computing (SEP 2015)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition. Cloud computing,</E>
                                     as used in this provision, means a model for enabling ubiquitous, convenient, on-demand network access to a shared pool of configurable computing resources (
                                    <E T="03">e.g.,</E>
                                     networks, servers, storage, applications, and services) that can be rapidly provisioned and released with 
                                    <PRTPAGE P="717"/>
                                    minimal management effort or service provider interaction. This includes other commercial terms, such as on-demand self-service, broad network access, resource pooling, rapid elasticity, and measured service. It also includes commercial offerings for software-as-a-service, infrastructure-as-a-service, and platform-as-a-service.
                                </P>
                                <P>(b) The Offeror shall indicate by checking the appropriate blank in paragraph (c) of this provision whether the use of cloud computing is anticipated under the resultant contract.</P>
                                <P>
                                    (c) 
                                    <E T="03">Representation.</E>
                                     The Offeror represents that it—
                                </P>
                                <P>____Does anticipate that cloud computing services will be used in the performance of any contract or subcontract resulting from this solicitation.</P>
                                <P>____Does not anticipate that cloud computing services will be used in the performance of any contract or subcontract resulting from this solicitation.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[80 FR 51745, Aug. 26, 2015, as amended at 80 FR 56930, Sept. 21, 2015; 80 FR 74695, Nov. 30, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.239-7010</SECTNO>
                            <SUBJECT>Cloud Computing Services.</SUBJECT>
                            <P>As prescribed in 239.7604(b), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Cloud Computing Services (JAN 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Authorizing official,</E>
                                     as described in DoD Instruction 8510.01, Risk Management Framework (RMF) for DoD Information Technology (IT), means the senior Federal official or executive with the authority to formally assume responsibility for operating an information system at an acceptable level of risk to organizational operations (including mission, functions, image, or reputation), organizational assets, individuals, other organizations, and the Nation.
                                </P>
                                <P>
                                    <E T="03">Cloud computing</E>
                                     means a model for enabling ubiquitous, convenient, on-demand network access to a shared pool of configurable computing resources (
                                    <E T="03">e.g.,</E>
                                     networks, servers, storage, applications, and services) that can be rapidly provisioned and released with minimal management effort or service provider interaction. This includes other commercial terms, such as on-demand self-service, broad network access, resource pooling, rapid elasticity, and measured service. It also includes commercial offerings for software-as-a-service, infrastructure-as-a-service, and platform-as-a-service.
                                </P>
                                <P>
                                    <E T="03">Compromise</E>
                                     means disclosure of information to unauthorized persons, or a violation of the security policy of a system, in which unauthorized intentional or unintentional disclosure, modification, destruction, or loss of an object, or the copying of information to unauthorized media may have occurred.
                                </P>
                                <P>
                                    <E T="03">Cyber incident</E>
                                     means actions taken through the use of computer networks that result in a compromise or an actual or potentially adverse effect on an information system and/or the information residing therein.
                                </P>
                                <P>
                                    <E T="03">Government data</E>
                                     means any information, document, media, or machine readable material regardless of physical form or characteristics, that is created or obtained by the Government in the course of official Government business.
                                </P>
                                <P>
                                    <E T="03">Government-related data</E>
                                     means any information, document, media, or machine readable material regardless of physical form or characteristics that is created or obtained by a contractor through the storage, processing, or communication of Government data. This does not include contractor's business records 
                                    <E T="03">e.g.</E>
                                     financial records, legal records etc. or data such as operating procedures, software coding or algorithms that are not uniquely applied to the Government data.
                                </P>
                                <P>
                                    <E T="03">Information system</E>
                                     means a discrete set of information resources organized for the collection, processing, maintenance, use, sharing, dissemination, or disposition of information.
                                </P>
                                <P>
                                    <E T="03">Media</E>
                                     means physical devices or writing surfaces including, but not limited to, magnetic tapes, optical disks, magnetic disks, large-scale integration memory chips, and printouts onto which information is recorded, stored, or printed within an information system.
                                </P>
                                <P>
                                    <E T="03">Spillage</E>
                                     security incident that results in the transfer of classified or controlled unclassified information onto an information system not accredited (
                                    <E T="03">i.e.,</E>
                                     authorized) for the appropriate security level.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Cloud computing security requirements.</E>
                                     The requirements of this clause are applicable when using cloud computing to provide information technology services in the performance of the contract.
                                </P>
                                <P>(1) If the Contractor indicated in its offer that it “does not anticipate the use of cloud computing services in the performance of a resultant contract,” in response to provision 252.239-7009, Representation of Use of Cloud Computing, and after the award of this contract, the Contractor proposes to use cloud computing services in the performance of the contract, the Contractor shall obtain approval from the Contracting Officer prior to utilizing cloud computing services in performance of the contract.</P>
                                <P>
                                    (2) The Contractor shall implement and maintain administrative, technical, and physical safeguards and controls with the security level and services required in accordance with the Cloud Computing Security Requirements Guide (SRG) (version in effect at 
                                    <PRTPAGE P="718"/>
                                    the time the solicitation is issued or as authorized by the Contracting Officer) found at 
                                    <E T="03">https://public.cyber.mil/dccs/dccs-documents/</E>
                                     unless notified by the Contracting Officer that this requirement has been waived by the DoD Chief Information Officer.
                                </P>
                                <P>(3) The Contractor shall maintain within the United States or outlying areas all Government data that is not physically located on DoD premises, unless the Contractor receives written notification from the Contracting Officer to use another location, in accordance with DFARS 239.7602-2(a).</P>
                                <P>
                                    (c) 
                                    <E T="03">Limitations on access to, and use and disclosure of Government data and Government-related data.</E>
                                </P>
                                <P>(1) The Contractor shall not access, use, or disclose Government data unless specifically authorized by the terms of this contract or a task order or delivery order issued hereunder.</P>
                                <P>(i) If authorized by the terms of this contract or a task order or delivery order issued hereunder, any access to, or use or disclosure of, Government data shall only be for purposes specified in this contract or task order or delivery order.</P>
                                <P>(ii) The Contractor shall ensure that its employees are subject to all such access, use, and disclosure prohibitions and obligations.</P>
                                <P>(iii) These access, use, and disclosure prohibitions and obligations shall survive the expiration or termination of this contract.</P>
                                <P>(2) The Contractor shall use Government-related data only to manage the operational environment that supports the Government data and for no other purpose unless otherwise permitted with the prior written approval of the Contracting Officer.</P>
                                <P>
                                    (d) 
                                    <E T="03">Cloud computing services cyber incident reporting.</E>
                                     The Contractor shall report all cyber incidents that are related to the cloud computing service provided under this contract. Reports shall be submitted to DoD via 
                                    <E T="03">http://dibnet.dod.mil/.</E>
                                </P>
                                <P>
                                    (e) 
                                    <E T="03">Malicious software.</E>
                                     The Contractor or subcontractors that discover and isolate malicious software in connection with a reported cyber incident shall submit the malicious software in accordance with instructions provided by the Contracting Officer.
                                </P>
                                <P>
                                    (f) 
                                    <E T="03">Media preservation and protection.</E>
                                     When a Contractor discovers a cyber incident has occurred, the Contractor shall preserve and protect images of all known affected information systems identified in the cyber incident report (see paragraph (d) of this clause) and all relevant monitoring/packet capture data for at least 90 days from the submission of the cyber incident report to allow DoD to request the media or decline interest.
                                </P>
                                <P>
                                    (g) 
                                    <E T="03">Access to additional information or equipment necessary for forensic analysis.</E>
                                     Upon request by DoD, the Contractor shall provide DoD with access to additional information or equipment that is necessary to conduct a forensic analysis.
                                </P>
                                <P>
                                    (h) 
                                    <E T="03">Cyber incident damage assessment activities.</E>
                                     If DoD elects to conduct a damage assessment, the Contracting Officer will request that the Contractor provide all of the damage assessment information gathered in accordance with paragraph (f) of this clause.
                                </P>
                                <P>
                                    (i) 
                                    <E T="03">Records management and facility access.</E>
                                </P>
                                <P>(1) The Contractor shall provide the Contracting Officer all Government data and Government-related data in the format specified in the contract.</P>
                                <P>(2) The Contractor shall dispose of Government data and Government-related data in accordance with the terms of the contract and provide the confirmation of disposition to the Contracting Officer in accordance with contract closeout procedures.</P>
                                <P>(3) The Contractor shall provide the Government, or its authorized representatives, access to all Government data and Government-related data, access to contractor personnel involved in performance of the contract, and physical access to any Contractor facility with Government data, for the purpose of audits, investigations, inspections, or other similar activities, as authorized by law or regulation.</P>
                                <P>
                                    (j) 
                                    <E T="03">Notification of third party access requests.</E>
                                     The Contractor shall notify the Contracting Officer promptly of any requests from a third party for access to Government data or Government-related data, including any warrants, seizures, or subpoenas it receives, including those from another Federal, State, or local agency. The Contractor shall cooperate with the Contracting Officer to take all measures to protect Government data and Government-related data from any unauthorized disclosure.
                                </P>
                                <P>
                                    (k) 
                                    <E T="03">Spillage.</E>
                                     Upon notification by the Government of a spillage, or upon the Contractor's discovery of a spillage, the Contractor shall cooperate with the Contracting Officer to address the spillage in compliance with agency procedures.
                                </P>
                                <P>
                                    (l) 
                                    <E T="03">Subcontracts.</E>
                                     The Contractor shall include this clause, including this paragraph (l), in all subcontracts that involve or may involve cloud services, including subcontracts for  commercial services.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[80 FR 51747, Aug. 26, 2015, as amended at 80 FR 74695, Nov. 30, 2015; 81 FR 73001, Oct. 21, 2016; 87 FR 59028, Sept. 29, 2022; 88 FR 6596, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.239-7011</SECTNO>
                            <SUBJECT>Special construction and equipment charges.</SUBJECT>
                            <P>As prescribed in 239.7411(b), use the following clause:</P>
                            <EXTRACT>
                                <PRTPAGE P="719"/>
                                <HD SOURCE="HD1">Special Construction and Equipment Charges (DEC 1991)</HD>
                                <P>(a) The Government will not directly reimburse the Contractor for the cost of constructing any facilities or providing any equipment, unless the Contracting Officer authorizes direct reimbursement.</P>
                                <P>(b) If the Contractor stops using facilities or equipment which the Government has, in whole or part, directly reimbursed, the Contractor shall allow the Government credit for the value of the facilities or equipment attributable to the Government's contribution. Determine the value of the facilities and equipment on the basis of their foreseeable reuse by the Contractor at the time their use is discontinued or on the basis of the net salvage value, whichever is greater. The Contractor shall promptly pay the Government the amount of any credit.</P>
                                <P>(c) The amount of the direct special construction charge shall not exceed—</P>
                                <P>(1) The actual costs to the Contractor; and</P>
                                <P>(2) An amount properly allocable to the services to be provided to the Government.</P>
                                <P>(d) The amount of the direct special construction charge shall not include costs incurred by the Contractor which are covered by—</P>
                                <P>(1) A cancellation or termination liability; or</P>
                                <P>(2) The Contractor's recurring or other nonrecurring charges.</P>
                                <P>(e) The Contractor represents that—</P>
                                <P>(1) Recurring charges for the services, facilities, and equipment do not include in the rate base any costs that have been reimbursed by the Government to the Contractor; and</P>
                                <P>(2) Depreciation charges are based only on the cost of facilities and equipment paid by the Contractor and not reimbursed by the Government.</P>
                                <P>(f) If it becomes necessary for the Contractor to incur costs to replace any facilities or equipment, the Government shall assume those costs or reimburse the Contractor for replacement costs at mutually acceptable rates under the following circumstances—</P>
                                <P>(1) The Government paid direct special construction charges; or</P>
                                <P>(2) The Government reimbursed the Contractor for those facilities or equipment as a part of the recurring charges; and</P>
                                <P>(3) The need for replacement was due to circumstances beyond the control and without the fault of the Contractor.</P>
                                <P>(g) Before incurring any costs under paragraph (f) of this clause, the Government shall have the right to terminate the service under the Cancellation or Termination of Orders clause of this contract.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.239-7012</SECTNO>
                            <SUBJECT>Title to telecommunication facilities and equipment.</SUBJECT>
                            <P>As prescribed in 239.7411(b), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Title to Telecommunication Facilities and Equipment (DEC 1991)</HD>
                                <P>(a) Title to all Contractor furnished facilities and equipment used under this agreement/contract shall remain with the Contractor even if the Government paid the costs of constructing the facilities or equipment. A mutually accepted communications service authorization may provide for exceptions.</P>
                                <P>(b) The Contractor shall operate and maintain all telecommunication facilities and equipment used under this agreement/contract whether the Government or the Contractor has title.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.239-7013</SECTNO>
                            <SUBJECT>Term of Agreement and Continuation of Services.</SUBJECT>
                            <P>
                                <E T="03">Basic.</E>
                                 As prescribed in 239.7411(c)(1), use the following clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Term of Agreement and Continuation of Services—Basic (OCT 2019</HD>
                                <P>(a) This basic agreement is not a contract. The Government incurs liability only upon issuance of a communication service authorization, which is a contract that incorporates the terms and conditions of this basic agreement.</P>
                                <P>(b) This agreement shall continue in force from year to year, unless terminated by either party by 30 days' written notice. Termination of this basic agreement does not terminate or cancel any communication service authorizations issued under this basic agreement prior to the termination.</P>
                                <P>(c) Communication service authorizations issued under this basic agreement may be modified to incorporate the terms and conditions of a new basic agreement negotiated with the Contractor.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate I.</E>
                                 As prescribed in 239.7411(c)(2), use the following clause, which uses a different paragraph (c) than the basic clause and adds a new paragraph (d).
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Term of Agreement and Continuation of Services—Alternate I (OCT 2019)</HD>
                                <P>
                                    (a) This basic agreement is not a contract. The Government incurs liability only upon 
                                    <PRTPAGE P="720"/>
                                    issuance of a communication service authorization, which is a contract that incorporates the terms and conditions of this basic agreement.
                                </P>
                                <P>(b) This agreement shall continue in force from year to year, unless terminated by either party by 30 days' written notice. Termination of this basic agreement does not terminate or cancel any communication service authorizations issued under this basic agreement prior to the termination.</P>
                                <P>(c) The Contractor's current communication services authorizations have been modified to incorporate the terms and conditions of this basic agreement.</P>
                                <P>(1) All current communication service authorizations issued by ________ that incorporate Basic Agreement Number ________, dated ________, are modified to incorporate this basic agreement.</P>
                                <P>(2) Current communication service authorizations, issued by the activity in paragraph (c)(1) of this clause, that incorporate other agreements with the Contractor may also be modified to incorporate this basic agreement.</P>
                                <P>(d) Communication service authorizations issued under this basic agreement may be modified to incorporate a new basic agreement with the Contractor.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[84 FR 58338, Oct. 31, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.239-7015</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.239-7016</SECTNO>
                            <SUBJECT>Telecommunications security equipment, devices, techniques, and services.</SUBJECT>
                            <P>As prescribed in 239.7411(d), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Telecommunications Security Equipment, Devices, Techniques, and Services (DEC 1991)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    (1) 
                                    <E T="03">Securing</E>
                                     means the application of Government-approved telecommunications security equipment, devices, techniques, or services to contractor telecommunications systems.
                                </P>
                                <P>
                                    (2) 
                                    <E T="03">Sensitive information</E>
                                     means any information the loss, misuse, or modification of which, or unauthorized access to, could adversely affect the national interest or the conduct of Federal programs, or the privacy to which individuals are entitled under 5 U.S.C. 552a (the Privacy Act), but which has not been specifically authorized under criteria established by an Executive Order or Act of Congress to be kept secret in the interest of national defense or foreign policy.
                                </P>
                                <P>
                                    (3) 
                                    <E T="03">Telecommunications systems</E>
                                     means voice, record, and data communications, including management information systems and local data networks that connect to external transmission media, when employed by Government agencies, contractors, and subcontractors to transmit—
                                </P>
                                <P>(i) Classified or sensitive information;</P>
                                <P>(ii) Matters involving intelligence activities, cryptologic activities related to national security, the command and control of military forces, or equipment that is an integral part of a weapon or weapons system; or</P>
                                <P>(iii) Matters critical to the direct fulfillment of military or intelligence missions.</P>
                                <P>(b) This solicitation/contract identifies classified or sensitive information that requires securing during telecommunications and requires the Contractor to secure telecommunications systems. The Contractor agrees to secure information and systems at the following location: (Identify the location.)</P>
                                <P>(c) To provide the security, the Contractor shall use Government-approved telecommunications equipment, devices, techniques, or services. A list of the approved equipment, etc. may be obtained from (identify where list can be obtained). Equipment, devices, techniques, or services used by the Contractor must be compatible or interoperable with (list and identify the location of any telecommunications security equipment, device, technique, or service currently being used by the technical or requirements organization or other offices with which the Contractor must communicate).</P>
                                <P>(d) Except as may be provided elsewhere in this contract, the Contractor shall furnish all telecommunications security equipment, devices, techniques, or services necessary to perform this contract. The Contractor must meet ownership eligibility conditions for communications security equipment designated as controlled cryptographic items.</P>
                                <P>(e) The Contractor agrees to include this clause, including this paragraph (e), in all subcontracts which require securing telecommunications.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.239-7017</SECTNO>
                            <SUBJECT>Notice of Supply Chain Risk.</SUBJECT>
                            <P>As prescribed in 239.7306(a), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Notice of Supply Chain Risk (DEC 2022) </HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition. Supply chain risk,</E>
                                     as used in this provision, means the risk that an adversary may sabotage, maliciously introduce unwanted function, or otherwise subvert the design, integrity, manufacturing, production, distribution, installation, operation, or maintenance of a covered system so as to surveil, deny, disrupt, or otherwise degrade the function, use, or operation of such system (see 10 U.S.C. 3252).
                                    <PRTPAGE P="721"/>
                                </P>
                                <P>(b) In order to manage supply chain risk, the Government may use the authorities provided by 10 U.S.C. 3252. In exercising these authorities, the Government may consider information, public and non-public, including all-source intelligence, relating to an offeror and its supply chain.</P>
                                <P>(c) If the Government exercises the authority provided in 10 U.S.C. 3252 to limit disclosure of information, no action undertaken by the Government under such authority shall be subject to review in a bid protest before the Government Accountability Office or in any Federal court.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[78 FR 69272, Nov. 18, 2013, as amended at 84 FR 4370, Feb. 15, 2019; 87 FR 76998, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.239-7018</SECTNO>
                            <SUBJECT>Supply Chain Risk.</SUBJECT>
                            <P>As prescribed in 239.7306(b), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Supply Chain Risk (DEC 2022)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Information technology</E>
                                     (see 40 U.S.C 11101(6)) means, in lieu of the definition at FAR 2.1, any equipment, or interconnected system(s) or subsystem(s) of equipment, that is used in the automatic acquisition, storage, analysis, evaluation, manipulation, management, movement, control, display, switching, interchange, transmission, or reception of data or information by the agency.
                                </P>
                                <P>(1) For purposes of this definition, equipment is used by an agency if the equipment is used by the agency directly or is used by a contractor under a contract with the agency that requires—</P>
                                <P>(i) Its use; or</P>
                                <P>(ii) To a significant extent, its use in the performance of a service or the furnishing of a product.</P>
                                <P>(2) The term “information technology” includes computers, ancillary equipment (including imaging peripherals, input, output, and storage devices necessary for security and surveillance), peripheral equipment designed to be controlled by the central processing unit of a computer, software, firmware and similar procedures, services (including support services), and related resources.</P>
                                <P>(3) The term “information technology” does not include any equipment acquired by a contractor incidental to a contract.</P>
                                <P>
                                    <E T="03">Supply chain risk</E>
                                     means the risk that an adversary may sabotage, maliciously introduce unwanted function, or otherwise subvert the design, integrity, manufacturing, production, distribution, installation, operation, or maintenance of a covered system so as to surveil, deny, disrupt, or otherwise degrade the function, use, or operation of such system (see 10 U.S.C. 3252).
                                </P>
                                <P>(b) The Contractor shall mitigate supply chain risk in the provision of supplies and services to the Government.</P>
                                <P>(c) In order to manage supply chain risk, the Government may use the authorities provided by 10 U.S.C. 3252. In exercising these authorities, the Government may consider information, public and non-public, including all-source intelligence, relating to a Contractor's supply chain.</P>
                                <P>(d) If the Government exercises the authority provided in 10 U.S.C. 3252 to limit disclosure of information, no action undertaken by the Government under such authority shall be subject to review in a bid protest before the Government Accountability Office or in any Federal court.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[78 FR 69272, Nov. 18, 2013, as amended at 80 FR 67252, Oct. 30, 2015; 84 FR 4370, Feb. 15, 2019; 87 FR 76998, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.241-7000</SECTNO>
                            <SUBJECT>Superseding contract.</SUBJECT>
                            <P>As prescribed in 241.501-70(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Superseding Contract (DEC 1991)</HD>
                                <P>This contract supersedes contract No. ______, dated ____ which provided similar services. Any capital credits accrued to the Government, any remaining credits due to the Government under the connection charge, or any termination liability are transferred to this contract, as follows:</P>
                                <HD SOURCE="HD1">Capital Credits</HD>
                                <P>(List years and accrued credits by year and separate delivery points.)</P>
                                <HD SOURCE="HD1">Outstanding Connection Charge Credits</HD>
                                <P>(List by month and year the amount credited and show the remaining amount of outstanding credits due the Government.)</P>
                                <HD SOURCE="HD1">Termination Liability Charges</HD>
                                <P>(List by month and year the amount of monthly facility cost recovered and show the remaining amount of facility cost to be recovered.)</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 63 FR 11549, Mar. 9, 1998]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.241-7001</SECTNO>
                            <SUBJECT>Government access.</SUBJECT>
                            <P>As prescribed in 241.501-70(b), use the following clause:</P>
                            <EXTRACT>
                                <PRTPAGE P="722"/>
                                <HD SOURCE="HD1">Government Access (DEC 1991)</HD>
                                <P>Authorized representatives of the Government may have access to the Contractor's on-base facilities upon reasonable notice or in case of emergency.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 63 FR 11549, Mar. 9, 1998]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.242-7000—252.242-7002</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.242-7004</SECTNO>
                            <SUBJECT>Material Management and Accounting System.</SUBJECT>
                            <P>As prescribed in 242.7204, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Material Management and Accounting System (MAY 2011)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    (1) 
                                    <E T="03">Material management and accounting system (MMAS)</E>
                                     means the Contractor's system or systems for planning, controlling, and accounting for the acquisition, use, issuing, and disposition of material. Material management and accounting systems may be manual or automated. They may be stand-alone systems or they may be integrated with planning, engineering, estimating, purchasing, inventory, accounting, or other systems.
                                </P>
                                <P>
                                    (2) 
                                    <E T="03">Valid time-phased requirements</E>
                                     means material that is—
                                </P>
                                <P>
                                    (i) Needed to fulfill the production plan, including reasonable quantities for scrap, shrinkage, yield, 
                                    <E T="03">etc.;</E>
                                     and
                                </P>
                                <P>(ii) Charged/billed to contracts or other cost objectives in a manner consistent with the need to fulfill the production plan.</P>
                                <P>
                                    (3) 
                                    <E T="03">Contractor</E>
                                     means a business unit as defined in section 31.001 of the Federal Acquisition Regulation (FAR).
                                </P>
                                <P>
                                    (4) 
                                    <E T="03">Acceptable material management and accounting system</E>
                                     means a MMAS that generally complies with the system criteria in paragraph (d) of this clause.
                                </P>
                                <P>
                                    (5) 
                                    <E T="03">Significant deficiency</E>
                                     means a shortcoming in the system that materially affects the ability of officials of the Department of Defense to rely upon information produced by the system that is needed for management purposes.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">General.</E>
                                     The Contractor shall—
                                </P>
                                <P>(1) Maintain an MMAS that—</P>
                                <P>(i) Reasonably forecasts material requirements;</P>
                                <P>(ii) Ensures that costs of purchased and fabricated material charged or allocated to a contract are based on valid time-phased requirements; and</P>
                                <P>(iii) Maintains a consistent, equitable, and unbiased logic for costing of material transactions; and</P>
                                <P>(2) Assess its MMAS and take reasonable action to comply with the MMAS standards in paragraph (e) of this clause.</P>
                                <P>
                                    (c) 
                                    <E T="03">Disclosure and maintenance requirements.</E>
                                     The Contractor shall—
                                </P>
                                <P>(1) Have policies, procedures, and operating instructions that adequately describe its MMAS;</P>
                                <P>(2) Provide to the Administrative Contracting Officer (ACO), upon request, the results of internal reviews that it has conducted to ensure compliance with established MMAS policies, procedures, and operating instructions; and</P>
                                <P>(3) Disclose significant changes in its MMAS to the ACO at least 30 days prior to implementation.</P>
                                <P>
                                    (d) 
                                    <E T="03">System criteria.</E>
                                     The MMAS shall have adequate internal controls to ensure system and data integrity, and shall—
                                </P>
                                <P>(1) Have an adequate system description including policies, procedures, and operating instructions that comply with the Federal Acquisition Regulation and Defense Federal Acquisition Regulation Supplement;</P>
                                <P>(2) Ensure that costs of purchased and fabricated material charged or allocated to a contract are based on valid time-phased requirements as impacted by minimum/economic order quantity restrictions.</P>
                                <P>(i) A 98 percent bill of material accuracy and a 95 percent master production schedule accuracy are desirable as a goal in order to ensure that requirements are both valid and appropriately time-phased.</P>
                                <P>(ii) If systems have accuracy levels below these, the Contractor shall provide adequate evidence that—</P>
                                <P>(A) There is no material harm to the Government due to lower accuracy levels; and</P>
                                <P>(B) The cost to meet the accuracy goals is excessive in relation to the impact on the Government;</P>
                                <P>(3) Provide a mechanism to identify, report, and resolve system control weaknesses and manual override. Systems should identify operational exceptions, such as excess/residual inventory, as soon as known;</P>
                                <P>(4) Provide audit trails and maintain records (manual and those in machine-readable form) necessary to evaluate system logic and to verify through transaction testing that the system is operating as desired;</P>
                                <P>(5) Establish and maintain adequate levels of record accuracy, and include reconciliation of recorded inventory quantities to physical inventory by part number on a periodic basis. A 95 percent accuracy level is desirable. If systems have an accuracy level below 95 percent, the Contractor shall provide adequate evidence that—</P>
                                <P>(i) There is no material harm to the Government due to lower accuracy levels; and</P>
                                <P>
                                    (ii) The cost to meet the accuracy goal is excessive in relation to the impact on the Government;
                                    <PRTPAGE P="723"/>
                                </P>
                                <P>(6) Provide detailed descriptions of circumstances that will result in manual or system generated transfers of parts;</P>
                                <P>(7) Maintain a consistent, equitable, and unbiased logic for costing of material transactions as follows:</P>
                                <P>(i) The Contractor shall maintain and disclose written policies describing the transfer methodology and the loan/pay-back technique.</P>
                                <P>(ii) The costing methodology may be standard or actual cost, or any of the inventory costing methods in 48 CFR 9904.411-50(b). The Contractor shall maintain consistency across all contract and customer types, and from accounting period to accounting period for initial charging and transfer charging.</P>
                                <P>(iii) The system should transfer parts and associated costs within the same billing period. In the few instances where this may not be appropriate, the Contractor may accomplish the material transaction using a loan/pay-back technique. The “loan/pay-back technique” means that the physical part is moved temporarily from the contract, but the cost of the part remains on the contract. The procedures for the loan/pay-back technique must be approved by the ACO. When the technique is used, the Contractor shall have controls to ensure—</P>
                                <P>(A) Parts are paid back expeditiously;</P>
                                <P>(B) Procedures and controls are in place to correct any overbilling that might occur;</P>
                                <P>(C) Monthly, at a minimum, identification of the borrowing contract and the date the part was borrowed; and</P>
                                <P>(D) The cost of the replacement part is charged to the borrowing contract;</P>
                                <P>(8) Where allocations from common inventory accounts are used, have controls (in addition to those in paragraphs (d)(2) and (7) of this clause) to ensure that—</P>
                                <P>(i) Reallocations and any credit due are processed no less frequently than the routine billing cycle;</P>
                                <P>(ii) Inventories retained for requirements that are not under contract are not allocated to contracts; and</P>
                                <P>(iii) Algorithms are maintained based on valid and current data;</P>
                                <P>(9) Have adequate controls to ensure that physically commingled inventories that may include material for which costs are charged or allocated to fixed-price, cost-reimbursement, and commercial contracts do not compromise requirements of any of the standards in paragraphs (d)(1) through (8) of this clause. Government-furnished material shall not be—</P>
                                <P>(i) Physically commingled with other material; or</P>
                                <P>(ii) Used on commercial work; and</P>
                                <P>(10) Be subjected to periodic internal reviews to ensure compliance with established policies and procedures.</P>
                                <P>
                                    (e) 
                                    <E T="03">Significant deficiencies.</E>
                                     (1) The Contracting Officer will provide an initial determination to the Contractor, in writing, of any significant deficiencies. The initial determination will describe the deficiency in sufficient detail to allow the Contractor to understand the deficiency.
                                </P>
                                <P>(2) The Contractor shall respond within 30 days to a written initial determination from the Contracting Officer that identifies significant deficiencies in the Contractor's MMAS. If the Contractor disagrees with the initial determination, the Contractor shall state, in writing, its rationale for disagreeing.</P>
                                <P>(3) The Contracting Officer will evaluate the Contractor's response and notify the Contractor, in writing, of the Contracting Officer's final determination concerning—</P>
                                <P>(i) Remaining significant deficiencies;</P>
                                <P>(ii) The adequacy of any proposed or completed corrective action; and</P>
                                <P>(iii) System disapproval if the Contracting Officer determines that one or more significant deficiencies remain.</P>
                                <P>(f) If the Contractor receives the Contracting Officer's final determination of significant deficiencies, the Contractor shall, within 45 days of receipt of the final determination, either correct the significant deficiencies or submit an acceptable corrective action plan showing milestones and actions to eliminate the significant deficiencies.</P>
                                <P>
                                    (g) 
                                    <E T="03">Withholding payments.</E>
                                     If the Contracting Officer makes a final determination to disapprove the Contractor's MMAS, and the contract includes the clause at 252.242-7005, Contractor Business Systems, the Contracting Officer will withhold payments in accordance with that clause.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[76 FR 28874, May 18, 2011]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.242-7005</SECTNO>
                            <SUBJECT>Contractor business systems.</SUBJECT>
                            <P>As prescribed in 242.7001, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Contractor Business Systems (FEB 2012)</HD>
                                <P>(a) This clause only applies to covered contracts that are subject to the Cost Accounting Standards under 41 U.S.C. chapter 15, as implemented in regulations found at 48 CFR 9903.201-1 (see the FAR Appendix).</P>
                                <P>
                                    (b) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Acceptable contractor business systems</E>
                                     means contractor business systems that comply with the terms and conditions of the applicable business system clauses listed in the definition of “contractor business systems” in this clause.
                                </P>
                                <P>
                                    <E T="03">Contractor business systems</E>
                                     means—
                                    <PRTPAGE P="724"/>
                                </P>
                                <P>(1) Accounting system, if this contract includes the clause at 252.242-7006, Accounting System Administration;</P>
                                <P>(2) Earned value management system, if this contract includes the clause at 252.234-7002, Earned Value Management System;</P>
                                <P>(3) Estimating system, if this contract includes the clause at 252.215-7002, Cost Estimating System Requirements;</P>
                                <P>(4) Material management and accounting system, if this contract includes the clause at 252.242-7004, Material Management and Accounting System;</P>
                                <P>(5) Property management system, if this contract includes the clause at 252.245-7003, Contractor Property Management System Administration; and</P>
                                <P>(6) Purchasing system, if this contract includes the clause at 252.244-7001, Contractor Purchasing System Administration.</P>
                                <P>
                                    <E T="03">Significant deficiency,</E>
                                     in the case of a contractor business system, means a shortcoming in the system that materially affects the ability of officials of the Department of Defense to rely upon information produced by the system that is needed for management purposes.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">General.</E>
                                     The Contractor shall establish and maintain acceptable business systems in accordance with the terms and conditions of this contract.
                                </P>
                                <P>
                                    (d) 
                                    <E T="03">Significant deficiencies.</E>
                                     (1) The Contractor shall respond, in writing, within 30 days to an initial determination that there are one or more significant deficiencies in one or more of the Contractor's business systems.
                                </P>
                                <P>(2) The Contracting Officer will evaluate the Contractor's response and notify the Contractor, in writing, of the final determination as to whether the Contractor's business system contains significant deficiencies. If the Contracting Officer determines that the Contractor's business system contains significant deficiencies, the final determination will include a notice to withhold payments.</P>
                                <P>
                                    (e) 
                                    <E T="03">Withholding payments.</E>
                                     (1) If the Contracting Officer issues the final determination with a notice to withhold payments for significant deficiencies in a contractor business system required under this contract, the Contracting Officer will withhold five percent of amounts due from progress payments and performance-based payments, and direct the Contractor, in writing, to withhold five percent from its billings on interim cost vouchers on cost-reimbursement, labor-hour, and time-and-materials contracts until the Contracting Officer has determined that the Contractor has corrected all significant deficiencies as directed by the Contracting Officer's final determination. The Contractor shall, within 45 days of receipt of the notice, either correct the deficiencies or submit an acceptable corrective action plan showing milestones and actions to eliminate the deficiencies.
                                </P>
                                <P>(2) If the Contractor submits an acceptable corrective action plan within 45 days of receipt of a notice of the Contracting Officer's intent to withhold payments, and the Contracting Officer, in consultation with the auditor or functional specialist, determines that the Contractor is effectively implementing such plan, the Contracting Officer will reduce withholding directly related to the significant deficiencies covered under the corrective action plan, to two percent from progress payments and performance-based payments, and direct the Contractor, in writing, to reduce the percentage withheld on interim cost vouchers to two percent until the Contracting Officer determines the Contractor has corrected all significant deficiencies as directed by the Contracting Officer's final determination. However, if at any time, the Contracting Officer determines that the Contractor has failed to follow the accepted corrective action plan, the Contracting Officer will increase withholding from progress payments and performance-based payments, and direct the Contractor, in writing, to increase the percentage withheld on interim cost vouchers to the percentage initially withheld, until the Contracting Officer determines that the Contractor has corrected all significant deficiencies as directed by the Contracting Officer's final determination.</P>
                                <P>
                                    (3) 
                                    <E T="03">Payment withhold percentage limits.</E>
                                </P>
                                <P>(i) The total percentage of payments withheld on amounts due under each progress payment, performance-based payment, or interim cost voucher, on this contract shall not exceed—</P>
                                <P>(A) Five percent for one or more significant deficiencies in any single contractor business system; and</P>
                                <P>(B) Ten percent for significant deficiencies in multiple contractor business systems.</P>
                                <P>(ii) If this contract contains pre-existing withholds, and the application of any subsequent payment withholds will cause withholding under this clause to exceed the payment withhold percentage limits in paragraph (e)(3)(i) of this clause, the Contracting Officer will reduce the payment withhold percentage in the final determination to an amount that will not exceed the payment withhold percentage limits.</P>
                                <P>(4) For the purpose of this clause, payment means any of the following payments authorized under this contract:</P>
                                <P>(i) Interim payments under—</P>
                                <P>(A) Cost-reimbursement contracts;</P>
                                <P>(B) Incentive type contracts;</P>
                                <P>(C) Time-and-materials contracts;</P>
                                <P>(D) Labor-hour contracts.</P>
                                <P>(ii) Progress payments.</P>
                                <P>(iii) Performance-based payments.</P>
                                <P>
                                    (5) Payment withholding shall not apply to payments on fixed-price line items where 
                                    <PRTPAGE P="725"/>
                                    performance is complete and the items were accepted by the Government.
                                </P>
                                <P>(6) The withholding of any amount or subsequent payment to the Contractor shall not be construed as a waiver of any rights or remedies the Government has under this contract.</P>
                                <P>(7) Notwithstanding the provisions of any clause in this contract providing for interim, partial, or other payment withholding on any basis, the Contracting Officer may withhold payment in accordance with the provisions of this clause.</P>
                                <P>(8) The payment withholding authorized in this clause is not subject to the interest-penalty provisions of the Prompt Payment Act.</P>
                                <P>
                                    (f) 
                                    <E T="03">Correction of deficiencies.</E>
                                     (1) The Contractor shall notify the Contracting Officer, in writing, when the Contractor has corrected the business system's deficiencies.
                                </P>
                                <P>(2) Once the Contractor has notified the Contracting Officer that all deficiencies have been corrected, the Contracting Officer will take one of the following actions:</P>
                                <P>(i) If the Contracting Officer determines that the Contractor has corrected all significant deficiencies as directed by the Contracting Officer's final determination, the Contracting Officer will, as appropriate, discontinue the withholding of progress payments and performance-based payments, and direct the Contractor, in writing, to discontinue the payment withholding from billings on interim cost vouchers under this contract associated with the Contracting Officer's final determination, and authorize the Contractor to bill for any monies previously withheld that are not also being withheld due to other significant deficiencies. Any payment withholding under this contract due to other significant deficiencies, will remain in effect until the Contracting Officer determines that those significant deficiencies are corrected.</P>
                                <P>(ii) If the Contracting Officer determines that the Contractor still has significant deficiencies, the Contracting Officer will continue the withholding of progress payments and performance-based payments, and the Contractor shall continue withholding amounts from its billings on interim cost vouchers n accordance with paragraph (e) of this clause, and not bill for any monies previously withheld.</P>
                                <P>(iii) If the Contracting Officer determines, based on the evidence submitted by the Contractor, that there is a reasonable expectation that the corrective actions have been implemented and are expected to correct the significant deficiencies, the Contracting Officer will discontinue withholding payments, and release any payments previously withheld directly related to the significant deficiencies identified in the Contractor notification, and direct the Contractor, in writing, to discontinue the payment withholding from billings on interim cost vouchers associated with the Contracting Officer's final determination, and authorize the Contractor to bill for any monies previously withheld.</P>
                                <P>(iv) If, within 90 days of receipt of the Contractor notification that the Contractor has corrected the significant deficiencies, the Contracting Officer has not made a determination in accordance with paragraphs (f)(2)(i), (ii), or (iii) of this clause, the Contracting Officer will reduce withholding directly related to the significant deficiencies identified in the Contractor notification by at least 50 percent of the amount being withheld from progress payments and performance-based payments, and direct the Contractor, in writing, to reduce the payment withholding from billings on interim cost vouchers directly related to the significant deficiencies identified in the Contractor notification by a specified percentage that is at least 50 percent, but not authorize the Contractor to bill for any monies previously withheld until the Contracting Officer makes a determination in accordance with paragraphs (f)(2)(i), (ii), or (iii) of this clause.</P>
                                <P>(v) At any time after the Contracting Officer reduces or discontinues the withholding of progress payments and performance-based payments, or directs the Contractor to reduce or discontinue the payment withholding from billings on interim cost vouchers under this contract, if the Contracting Officer determines that the Contractor has failed to correct the significant deficiencies identified in the Contractor's notification, the Contracting Officer will reinstate or increase withholding from progress payments and performance-based payments, and direct the Contractor, in writing, to reinstate or increase the percentage withheld on interim cost vouchers to the percentage initially withheld, until the Contracting Officer determines that the Contractor has corrected all significant deficiencies as directed by the Contracting Officer's final determination.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[76 FR 28875, May 18, 2011, as amended at 77 FR 11366, Feb. 24, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.242-7006</SECTNO>
                            <SUBJECT>Accounting system administration.</SUBJECT>
                            <P>As prescribed in 242.7503, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Accounting System Administration (FEB 2012)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    (1) 
                                    <E T="03">Acceptable accounting system</E>
                                     means a system that complies with the system criteria in paragraph (c) of this clause to provide reasonable assurance that—
                                </P>
                                <P>
                                    (i) Applicable laws and regulations are complied with;
                                    <PRTPAGE P="726"/>
                                </P>
                                <P>(ii) The accounting system and cost data are reliable;</P>
                                <P>(iii) Risk of misallocations and mischarges are minimized; and</P>
                                <P>(iv) Contract allocations and charges are consistent with billing procedures.</P>
                                <P>
                                    (2) 
                                    <E T="03">Accounting system</E>
                                     means the Contractor's system or systems for accounting methods, procedures, and controls established to gather, record, classify, analyze, summarize, interpret, and present accurate and timely financial data for reporting in compliance with applicable laws, regulations, and management decisions, and may include subsystems for specific areas such as indirect and other direct costs, compensation, billing, labor, and general information technology.
                                </P>
                                <P>
                                    (3) 
                                    <E T="03">Significant deficiency</E>
                                     means a shortcoming in the system that materially affects the ability of officials of the Department of Defense to rely upon information produced by the system that is needed for management purposes.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">General.</E>
                                     The Contractor shall establish and maintain an acceptable accounting system. Failure to maintain an acceptable accounting system, as defined in this clause, shall result in the withholding of payments if the contract includes the clause at 252.242-7005, Contractor Business Systems, and also may result in disapproval of the system.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">System criteria.</E>
                                     The Contractor's accounting system shall provide for—
                                </P>
                                <P>(1) A sound internal control environment, accounting framework, and organizational structure;</P>
                                <P>(2) Proper segregation of direct costs from indirect costs;</P>
                                <P>(3) Identification and accumulation of direct costs by contract;</P>
                                <P>(4) A logical and consistent method for the accumulation and allocation of indirect costs to intermediate and final cost objectives;</P>
                                <P>(5) Accumulation of costs under general ledger control;</P>
                                <P>(6) Reconciliation of subsidiary cost ledgers and cost objectives to general ledger;</P>
                                <P>(7) Approval and documentation of adjusting entries;</P>
                                <P>(8) Management reviews or internal audits of the system to ensure compliance with the Contractor's established policies, procedures, and accounting practices;</P>
                                <P>(9) A timekeeping system that identifies employees' labor by intermediate or final cost objectives;</P>
                                <P>(10) A labor distribution system that charges direct and indirect labor to the appropriate cost objectives;</P>
                                <P>(11) Interim (at least monthly) determination of costs charged to a contract through routine posting of books of account;</P>
                                <P>(12) Exclusion from costs charged to Government contracts of amounts which are not allowable in terms of Federal Acquisition Regulation (FAR) part 31, Contract Cost Principles and Procedures, and other contract provisions;</P>
                                <P>(13) Identification of costs by contract line item and by units (as if each unit or line item were a separate contract), if required by the contract;</P>
                                <P>(14) Segregation of preproduction costs from production costs, as applicable;</P>
                                <P>(15) Cost accounting information, as required—</P>
                                <P>(i) By contract clauses concerning limitation of cost (FAR 52.232-20), limitation of funds (FAR 52.232-22), or allowable cost and payment (FAR 52.216-7); and</P>
                                <P>(ii) To readily calculate indirect cost rates from the books of accounts;</P>
                                <P>(16) Billings that can be reconciled to the cost accounts for both current and cumulative amounts claimed and comply with contract terms;</P>
                                <P>(17) Adequate, reliable data for use in pricing follow-on acquisitions; and</P>
                                <P>(18) Accounting practices in accordance with standards promulgated by the Cost Accounting Standards Board, if applicable, otherwise, Generally Accepted Accounting Principles.</P>
                                <P>
                                    (d) 
                                    <E T="03">Significant deficiencies.</E>
                                     (1) The Contracting Officer will provide an initial determination to the Contractor, in writing, on any significant deficiencies. The initial determination will describe the deficiency in sufficient detail to allow the Contractor to understand the deficiency.
                                </P>
                                <P>(2) The Contractor shall respond within 30 days to a written initial determination from the Contracting Officer that identifies significant deficiencies in the Contractor's accounting system. If the Contractor disagrees with the initial determination, the Contractor shall state, in writing, its rationale for disagreeing.</P>
                                <P>(3) The Contracting Officer will evaluate the Contractor's response and notify the Contractor, in writing, of the Contracting Officer's final determination concerning—</P>
                                <P>(i) Remaining significant deficiencies;</P>
                                <P>(ii) The adequacy of any proposed or completed corrective action; and</P>
                                <P>(iii) System disapproval, if the Contracting Officer determines that one or more significant deficiencies remain.</P>
                                <P>(e) If the Contractor receives the Contracting Officer's final determination of significant deficiencies, the Contractor shall, within 45 days of receipt of the final determination, either correct the significant deficiencies or submit an acceptable corrective action plan showing milestones and actions to eliminate the significant deficiencies.</P>
                                <P>
                                    (f) 
                                    <E T="03">Withholding payments.</E>
                                     If the Contracting Officer makes a final determination to disapprove the Contractor's accounting system, and the contract includes the clause at 252.242-7005, Contractor Business Systems, 
                                    <PRTPAGE P="727"/>
                                    the Contracting Officer will withhold payments in accordance with that clause.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[76 FR 28877, May 18, 2011, as amended at 77 FR 11366, Feb. 24, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.243-7000</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.243-7001</SECTNO>
                            <SUBJECT>Pricing of contract modifications.</SUBJECT>
                            <P>As prescribed in 243.205-70, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Pricing of Contract Modifications (DEC 1991)</HD>
                                <P>When costs are a factor in any price adjustment under this contract, the contract cost principles and procedures in FAR part 31 and DFARS part 231, in effect on the date of this contract, apply.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 66 FR 49865, Oct. 1, 2001]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.243-7002</SECTNO>
                            <SUBJECT>Requests for Equitable Adjustment.</SUBJECT>
                            <P>As prescribed in 243.205-71, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Requests for Equitable Adjustment  (DEC 2022)</HD>
                                <P>(a) The amount of any request for equitable adjustment to contract terms shall accurately reflect the contract adjustment for which the Contractor believes the Government is liable. The request shall include only costs for performing the change, and shall not include any costs that already have been reimbursed or that have been separately claimed. All indirect costs included in the request shall be properly allocable to the change in accordance with applicable acquisition regulations.</P>
                                <P>(b) In accordance with 10 U.S.C. 3862(a), any request for equitable adjustment to contract terms that exceeds the simplified acquisition threshold shall bear, at the time of submission, the following certificate executed by an individual authorized to certify the request on behalf of the Contractor:</P>
                                <P>I certify that the request is made in good faith, and that the supporting data are accurate and complete to the best of my knowledge and belief.</P>
                                <FP SOURCE="FP-DASH"/>
                                <FP>(Official's Name)</FP>
                                <FP SOURCE="FP-DASH"/>
                                <FP>(Title)</FP>
                                <P>(c) The certification in paragraph (b) of this clause requires full disclosure of all relevant facts, including—</P>
                                <P>(1) Certified cost or pricing data if required in accordance with subsection 15.403-4 of the Federal Acquisition Regulation (FAR); and</P>
                                <P>(2) Data other than certified cost or pricing data, in accordance with subsection 15.403-3 of the FAR, including actual cost data and data to support any estimated costs, even if certified cost or pricing data are not required.</P>
                                <P>(d) The certification requirement in paragraph (b) of this clause does not apply to—</P>
                                <P>(1) Requests for routine contract payments; for example, requests for payment for accepted supplies and services, routine vouchers under a cost-reimbursement type contract, or progress payment invoices; or</P>
                                <P>(2) Final adjustment under an incentive provision of the contract.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[63 FR 11549, Mar. 9, 1998, as amended at 66 FR 49865, Oct. 1, 2001; 77 FR 76941, Dec. 31, 2012; 87 FR 76998, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.244-7000</SECTNO>
                            <SUBJECT>Subcontracts for Commercial Products or Commercial Services.</SUBJECT>
                            <P>As prescribed in 244.403, use the following clause:</P>
                            <HD SOURCE="HD1">Subcontracts for Commercial Products or Commercial Services (NOV 2023)</HD>
                            <EXTRACT>
                                <P>(a) The Contractor shall not include the terms of any Federal Acquisition Regulation (FAR) clause or Defense Federal Acquisition Regulation Supplement (DFARS) clause in subcontracts for commercial products or commercial services at any tier under this contract, unless—</P>
                                <P>(1) For DFARS clauses, it is so specified in the particular clause; or</P>
                                <P>(2) For FAR clauses, the clause is listed at FAR 12.301(d) or it is so specified in paragraph (e)(1) of the clause at FAR 52.212-5 or paragraph (b)(1) of the clause at FAR 52.244-6, as applicable. (Section 847(b)(1)(B), Pub. L. 114-328)</P>
                                <P>(b)(1) In accordance with 10 U.S.C. 3457(c), the Contractor shall treat as commercial products any items valued at less than $10,000 per item that were purchased by the Contractor for use in the performance of multiple contracts with the Department of Defense and other parties and are not identifiable to any particular contract when purchased.</P>
                                <P>
                                    (2) The Contractor shall ensure that any items to be used in performance of this contract, that are treated as commercial products pursuant to paragraph (b)(1) of this 
                                    <PRTPAGE P="728"/>
                                    clause, meet all terms and conditions of this contract that are applicable to commercial products or commercial services in accordance with the clause at FAR 52.244-6 and paragraph (a) of this clause.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Subcontracts.</E>
                                     The Contractor shall include the terms of this clause, including this paragraph (c), in subcontracts awarded under this contract, including subcontracts for the acquisition of commercial products or commercial services.
                                </P>
                                <FP>(End of clause)</FP>
                            </EXTRACT>
                            <CITA>[88 FR 80465, Nov. 17, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.244-7001</SECTNO>
                            <SUBJECT>Contractor purchasing system administration.</SUBJECT>
                            <P>
                                <E T="03">Basic.</E>
                                 As prescribed in 244.305-71 and 244.305-71(a), use the following clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Contractor Purchasing System Administration—Basic (MAY 2014)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Acceptable purchasing system</E>
                                     means a purchasing system that complies with the system criteria in paragraph (c) of this clause.
                                </P>
                                <P>
                                    <E T="03">Purchasing system</E>
                                     means the Contractor's system or systems for purchasing and subcontracting, including make-or-buy decisions, the selection of vendors, analysis of quoted prices, negotiation of prices with vendors, placing and administering of orders, and expediting delivery of materials.
                                </P>
                                <P>
                                    <E T="03">Significant deficiency</E>
                                     means a shortcoming in the system that materially affects the ability of officials of the Department of Defense to rely upon information produced by the system that is needed for management purposes.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">General.</E>
                                     The Contractor shall establish and maintain an acceptable purchasing system. Failure to maintain an acceptable purchasing system, as defined in this clause, may result in disapproval of the system by the Contracting Officer and/or withholding of payments.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">System criteria.</E>
                                     The Contractor's purchasing system shall—
                                </P>
                                <P>(1) Have an adequate system description including policies, procedures, and purchasing practices that comply with the Federal Acquisition Regulation (FAR) and the Defense Federal Acquisition Regulation Supplement (DFARS);</P>
                                <P>(2) Ensure that all applicable purchase orders and subcontracts contain all flowdown clauses, including terms and conditions and any other clauses needed to carry out the requirements of the prime contract;</P>
                                <P>(3) Maintain an organization plan that establishes clear lines of authority and responsibility;</P>
                                <P>(4) Ensure all purchase orders are based on authorized requisitions and include a complete and accurate history of purchase transactions to support vendor selected, price paid, and document the subcontract/purchase order files which are subject to Government review;</P>
                                <P>(5) Establish and maintain adequate documentation to provide a complete and accurate history of purchase transactions to support vendors selected and prices paid;</P>
                                <P>(6) Apply a consistent make-or-buy policy that is in the best interest of the Government;</P>
                                <P>(7) Use competitive sourcing to the maximum extent practicable, and ensure debarred or suspended contractors are properly excluded from contract award;</P>
                                <P>(8) Evaluate price, quality, delivery, technical capabilities, and financial capabilities of competing vendors to ensure fair and reasonable prices;</P>
                                <P>(9) Require management level justification and adequate cost or price analysis, as applicable, for any sole or single source award;</P>
                                <P>(10) Perform timely and adequate cost or price analysis and technical evaluation for each subcontractor and supplier proposal or quote to ensure fair and reasonable subcontract prices;</P>
                                <P>(11) Document negotiations in accordance with FAR 15.406-3;</P>
                                <P>(12) Seek, take, and document economically feasible purchase discounts, including cash discounts, trade discounts, quantity discounts, rebates, freight allowances, and company-wide volume discounts;</P>
                                <P>(13) Ensure proper type of contract selection and prohibit issuance of cost-plus-a-percentage-of-cost subcontracts;</P>
                                <P>(14) Maintain subcontract surveillance to ensure timely delivery of an acceptable product and procedures to notify the Government of potential subcontract problems that may impact delivery, quantity, or price;</P>
                                <P>(15) Document and justify reasons for subcontract changes that affect cost or price;</P>
                                <P>(16) Notify the Government of the award of all subcontracts that contain the FAR and DFARS flowdown clauses that allow for Government audit of those subcontracts, and ensure the performance of audits of those subcontracts;</P>
                                <P>(17) Enforce adequate policies on conflict of interest, gifts, and gratuities, including the requirements of the 41 U.S.C. chapter 87, Kickbacks;</P>
                                <P>(18) Perform internal audits or management reviews, training, and maintain policies and procedures for the purchasing department to ensure the integrity of the purchasing system;</P>
                                <P>
                                    (19) Establish and maintain policies and procedures to ensure purchase orders and subcontracts contain mandatory and applicable flowdown clauses, as required by the FAR and DFARS, including terms and conditions required by the prime contract and any clauses required to carry out the requirements of the prime contract, including the requirements of 252.246-7007, Contractor 
                                    <PRTPAGE P="729"/>
                                    Counterfeit Electronic Part Detection and Avoidance System, if applicable;
                                </P>
                                <P>(20) Provide for an organizational and administrative structure that ensures effective and efficient procurement of required quality materials and parts at the best value from responsible and reliable sources, including the requirements of 252.246-7007, Contractor Counterfeit Electronic Part Detection and Avoidance System, if applicable;</P>
                                <P>(21) Establish and maintain selection processes to ensure the most responsive and responsible sources for furnishing required quality parts and materials and to promote competitive sourcing among dependable suppliers so that purchases are reasonably priced and from sources that meet contractor quality requirements, including the requirements of 252.246-7007, Contractor Counterfeit Electronic Part Detection and Avoidance System, and the item marking requirements of 252.211-7003, Item Unique Identification and Valuation, if applicable;</P>
                                <P>(22) Establish and maintain procedures to ensure performance of adequate price or cost analysis on purchasing actions;</P>
                                <P>(23) Establish and maintain procedures to ensure that proper types of subcontracts are selected, and that there are controls over subcontracting, including oversight and surveillance of subcontracted effort; and</P>
                                <P>(24) Establish and maintain procedures to timely notify the Contracting Officer, in writing, if—</P>
                                <P>(i) The Contractor changes the amount of subcontract effort after award such that it exceeds 70 percent of the total cost of the work to be performed under the contract, task order, or delivery order. The notification shall identify the revised cost of the subcontract effort and shall include verification that the Contractor will provide added value; or</P>
                                <P>(ii) Any subcontractor changes the amount of lower-tier subcontractor effort after award such that it exceeds 70 percent of the total cost of the work to be performed under its subcontract. The notification shall identify the revised cost of the subcontract effort and shall include verification that the subcontractor will provide added value as related to the work to be performed by the lower-tier subcontractor(s).</P>
                                <P>
                                    (d) 
                                    <E T="03">Significant deficiencies.</E>
                                     (1) The Contracting Officer will provide notification of initial determination to the Contractor, in writing, of any significant deficiencies. The initial determination will describe the deficiency in sufficient detail to allow the Contractor to understand the deficiency.
                                </P>
                                <P>(2) The Contractor shall respond within 30 days to a written initial determination from the Contracting Officer that identifies significant deficiencies in the Contractor's purchasing system. If the Contractor disagrees with the initial determination, the Contractor shall state, in writing, its rationale for disagreeing.</P>
                                <P>(3) The Contracting Officer will evaluate the Contractor's response and notify the Contractor, in writing, of the Contracting Officer's final determination concerning—</P>
                                <P>(i) Remaining significant deficiencies;</P>
                                <P>(ii) The adequacy of any proposed or completed corrective action; and</P>
                                <P>(iii) System disapproval, if the Contracting Officer determines that one or more significant deficiencies remain.</P>
                                <P>(e) If the Contractor receives the Contracting Officer's final determination of significant deficiencies, the Contractor shall, within 45 days of receipt of the final determination, either correct the significant deficiencies or submit an acceptable corrective action plan showing milestones and actions to eliminate the deficiencies.</P>
                                <P>
                                    (f) 
                                    <E T="03">Withholding payments.</E>
                                     If the Contracting Officer makes a final determination to disapprove the Contractor's purchasing system, and the contract includes the clause at 252.242-7005, Contractor Business Systems, the Contracting Officer will withhold payments in accordance with that clause.
                                </P>
                            </EXTRACT>
                            <P>
                                <E T="03">Alternate I.</E>
                                 As prescribed in 244.305-71 and 244.305-71(b), use the following clause, which amends paragraph (c) of the basic clause by deleting paragraphs (c)(1) through (c)(18) and (c)(22) through (c)(24), and revising and renumbering paragraphs (c)(19) through (c)(21) of the basic clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Contractor Purchasing System Administration—Alternate I (MAY 2014)</HD>
                                <P>The following paragraphs (a) through (f) of this clause do not apply unless the Contractor is subject to the Cost Accounting Standards under 41 U.S.C. chapter 15, as implemented in regulations found at 48 CFR 9903.201-1.</P>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Acceptable purchasing system</E>
                                     means a purchasing system that complies with the system criteria in paragraph (c) of this clause.
                                </P>
                                <P>
                                    <E T="03">Purchasing system</E>
                                     means the Contractor's system or systems for purchasing and subcontracting, including make-or-buy decisions, the selection of vendors, analysis of quoted prices, negotiation of prices with vendors, placing and administering of orders, and expediting delivery of materials.
                                </P>
                                <P>
                                    <E T="03">Significant deficiency</E>
                                     means a shortcoming in the system that materially affects the ability of officials of the Department of Defense to rely upon information produced by the system that is needed for management purposes.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Acceptable purchasing system.</E>
                                     The Contractor shall establish and maintain an acceptable purchasing system. Failure to maintain an acceptable purchasing system, 
                                    <PRTPAGE P="730"/>
                                    as defined in this clause, may result in disapproval of the system by the Contracting Officer and/or withholding of payments.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">System criteria.</E>
                                     The Contractor's purchasing system shall—
                                </P>
                                <P>(1) Establish and maintain policies and procedures to ensure purchase orders and subcontracts contain mandatory and applicable flowdown clauses, as required by the FAR and DFARS, including terms and conditions required by the prime contract and any clauses required to carry out the requirements of the prime contract, including the requirements of 252.246-7007, Contractor Counterfeit Electronic Part Detection and Avoidance System;</P>
                                <P>(2) Provide for an organizational and administrative structure that ensures effective and efficient procurement of required quality materials and parts at the best value from responsible and reliable sources, including the requirements of 252.246-7007, Contractor Counterfeit Electronic Part Detection and Avoidance System, and, if applicable, the item marking requirements of 252.211-7003, Item Unique Identification and Valuation; and</P>
                                <P>(3) Establish and maintain selection processes to ensure the most responsive and responsible sources for furnishing required quality parts and materials and to promote competitive sourcing among dependable suppliers so that purchases are from sources that meet contractor quality requirements, including the requirements of 252.246-7007, Contractor Counterfeit Electronic Part Detection and Avoidance System.</P>
                                <P>
                                    (d) 
                                    <E T="03">Significant deficiencies.</E>
                                     (1) The Contracting Officer will provide notification of initial determination to the Contractor, in writing, of any significant deficiencies. The initial determination will describe the deficiency in sufficient detail to allow the Contractor to understand the deficiency.
                                </P>
                                <P>(2) The Contractor shall respond within 30 days to a written initial determination from the Contracting Officer that identifies significant deficiencies in the Contractor's purchasing system. If the Contractor disagrees with the initial determination, the Contractor shall state, in writing, its rationale for disagreeing.</P>
                                <P>(3) The Contracting Officer will evaluate the Contractor's response and notify the Contractor, in writing, of the Contracting Officer's final determination concerning—</P>
                                <P>(i) Remaining significant deficiencies;</P>
                                <P>(ii) The adequacy of any proposed or completed corrective action; and</P>
                                <P>(iii) System disapproval, if the Contracting Officer determines that one or more significant deficiencies remain.</P>
                                <P>(e) If the Contractor receives the Contracting Officer's final determination of significant deficiencies, the Contractor shall, within 45 days of receipt of the final determination, either correct the significant deficiencies or submit an acceptable corrective action plan showing milestones and actions to eliminate the deficiencies.</P>
                                <P>
                                    (f) 
                                    <E T="03">Withholding payments.</E>
                                     If the Contracting Officer makes a final determination to disapprove the Contractor's purchasing system, and the contract includes the clause at 252.242-7005, Contractor Business Systems, the Contracting Officer will withhold payments in accordance with that clause.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[76 FR 28877, May 18, 2011, as amended at 77 FR 35882, June 15, 2012; 79 FR 26107, May 6, 2014; 80 FR 36900, June 26, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.245-7000</SECTNO>
                            <SUBJECT>Government-furnished mapping, charting, and geodesy property.</SUBJECT>
                            <P>As prescribed in 245.107(2), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Government-Furnished Mapping, Charting, and Geodesy Property (APR 2012)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition—Mapping, charting, and geodesy (MC&amp;G) property</E>
                                     means geodetic, geomagnetic, gravimetric, aeronautical, topographic, hydrographic, cultural, and toponymic data presented in the form of topographic, planimetric, relief, or thematic maps and graphics; nautical and aeronautical charts and publications; and in simulated, photographic, digital, or computerized formats.
                                </P>
                                <P>(b) The Contractor shall not duplicate, copy, or otherwise reproduce MC&amp;G property for purposes other than those necessary for performance of the contract.</P>
                                <P>(c) At the completion of performance of the contract, the Contractor, as directed by the Contracting Officer, shall either destroy or return to the Government all Government-furnished MC&amp;G property not consumed in the performance of this contract.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 74 FR 37648, July 29, 2009; 76 FR 6006, Feb. 2, 2011; 77 FR 23632, Apr. 20, 2012; 85 FR 53683, Aug. 31, 2020]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.245-7001</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.245-7002</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.245-7003</SECTNO>
                            <SUBJECT>Contractor Property Management System Administration.</SUBJECT>
                            <P>As prescribed in 245.107(3), insert the following clause:</P>
                            <EXTRACT>
                                <PRTPAGE P="731"/>
                                <HD SOURCE="HD1">Contractor Property Management System Administration (APR 2012)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Acceptable property management system</E>
                                     means a property system that complies with the system criteria in paragraph (c) of this clause.
                                </P>
                                <P>
                                    <E T="03">Property management system</E>
                                     means the Contractor's system or systems for managing and controlling Government property.
                                </P>
                                <P>
                                    <E T="03">Significant deficiency</E>
                                     means a shortcoming in the system that materially affects the ability of officials of the Department of Defense to rely upon information produced by the system that is needed for management purposes.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">General.</E>
                                     The Contractor shall establish and maintain an acceptable property management system. Failure to maintain an acceptable property management system, as defined in this clause, may result in disapproval of the system by the Contracting Officer and/or withholding of payments.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">System criteria.</E>
                                     The Contractor's property management system shall be in accordance with paragraph (f) of the contract clause at Federal Acquisition Regulation 52.245-1.
                                </P>
                                <P>
                                    (d) 
                                    <E T="03">Significant deficiencies.</E>
                                     (1) The Contracting Officer will provide an initial determination to the Contractor, in writing, of any significant deficiencies. The initial determination will describe the deficiency in sufficient detail to allow the Contractor to understand the deficiency.
                                </P>
                                <P>(2) The Contractor shall respond within 30 days to a written initial determination from the Contracting Officer that identifies significant deficiencies in the Contractor's property management system. If the Contractor disagrees with the initial determination, the Contractor shall state, in writing, its rationale for disagreeing.</P>
                                <P>(3) The Contracting Officer will evaluate the Contractor's response and notify the Contractor, in writing, of the Contracting Officer's final determination concerning—</P>
                                <P>(i) Remaining significant deficiencies;</P>
                                <P>(ii) The adequacy of any proposed or completed corrective action; and</P>
                                <P>(iii) System disapproval, if the Contracting Officer determines that one or more significant deficiencies remain.</P>
                                <P>(e) If the Contractor receives the Contracting Officer's final determination of significant deficiencies, the Contractor shall, within 45 days of receipt of the final determination, either correct the significant deficiencies or submit an acceptable corrective action plan showing milestones and actions to eliminate the significant deficiencies.</P>
                                <P>
                                    (f) 
                                    <E T="03">Withholding payments.</E>
                                     If the Contracting Officer makes a final determination to disapprove the Contractor's property management system, and the contract includes the clause at 252.242-7005, Contractor Business Systems, the Contracting Officer will withhold payments in accordance with that clause.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[76 FR 28878, May 18, 2011, as amended at 77 FR 11366, Feb. 24, 2012; 77 FR 23632, Apr. 20, 2012; 85 FR 53683, Aug. 31, 2020; 88 FR 88537, Dec. 22, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.245-7004</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.245-7005</SECTNO>
                            <SUBJECT>Management and Reporting of Government Property.</SUBJECT>
                            <P>As prescribed in 245.107(4), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Management and Reporting of Government Property (Jan 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">As is</E>
                                     means that the Government makes no warranty with respect to the serviceability and/or suitability of the Government property for contract performance and that the Government will not pay for any repairs, replacement, and/or refurbishment of the property.
                                </P>
                                <P>
                                    <E T="03">Commercial and Government Entity (CAGE) code</E>
                                     means—
                                </P>
                                <P>(1) An identifier assigned to entities located in the United States or its outlying areas by the Defense Logistics Agency (DLA) Commercial and Government Entity (CAGE) Branch to identify a commercial or government entity by unique location; or</P>
                                <P>(2) An identifier assigned by a member of the North Atlantic Treaty Organization (NATO) or by the NATO Support and Procurement Agency (NSPA) to entities located outside the United States and its outlying areas that the DLA Commercial and Government Entity (CAGE) Branch records and maintains in the CAGE master file. This type of code is known as a NATO CAGE (NCAGE) code.</P>
                                <P>
                                    <E T="03">Contractor-acquired property, contractor inventory, Government property, Government-furnished property,</E>
                                     and 
                                    <E T="03">loss of Government property</E>
                                     have the meanings given in the Federal Acquisition Regulation (FAR) 52.245-1, Government Property, clause of this contract.
                                </P>
                                <P>
                                    <E T="03">Demilitarization</E>
                                     means the act of eliminating the functional capabilities and inherent military design features from DoD personal property. Methods and degree range from removal and destruction of critical features to total destruction by cutting, tearing, crushing, mangling, shredding, melting, burning, etc.
                                </P>
                                <P>
                                    <E T="03">Export-controlled items</E>
                                     has the meaning given in the Defense Federal Acquisition Regulation Supplement (DFARS) 252.225-7048, Export-Controlled Items, clause of this contract.
                                    <PRTPAGE P="732"/>
                                </P>
                                <P>
                                    <E T="03">Ineligible transferee</E>
                                     means an individual, an entity, or a country—
                                </P>
                                <P>
                                    (1) Excluded from Federal programs by the General Services Administration as identified in the System for Award Management Exclusions located at 
                                    <E T="03">https://sam.gov;</E>
                                </P>
                                <P>(2) Delinquent on obligations to the U.S. Government under surplus sales contracts;</P>
                                <P>(3) Designated by the Department of Defense as ineligible, debarred, or suspended from defense contracts; or</P>
                                <P>(4) Subject to denial, debarment, or other sanctions under export control laws and related laws and regulations, and orders administered by the Department of State, the Department of Commerce, the Department of Homeland Security, or the Department of the Treasury.</P>
                                <P>
                                    <E T="03">Item unique identification</E>
                                     means a system of assigning, reporting, and marking DoD property with unique item identifiers that have machine-readable data elements to distinguish an item from all other like and unlike items.
                                </P>
                                <P>
                                    <E T="03">National stock number</E>
                                     means a 13-digit stock number used to identify items of supply. It consists of a four-digit Federal Supply Code and a nine-digit National Item Identification Number.
                                </P>
                                <P>
                                    <E T="03">Reparable item</E>
                                     means an item, typically in unserviceable condition, furnished to the contractor for maintenance, repair, modification, or overhaul.
                                </P>
                                <P>
                                    <E T="03">Scrap</E>
                                     means property that has no value except for its basic material content. For purposes of demilitarization, scrap is defined as recyclable waste and discarded materials derived from items that have been rendered useless beyond repair, rehabilitation, or restoration such that the item's original identity, utility, form, fit, and function have been destroyed. Items can be classified as scrap if processed by cutting, tearing, crushing, mangling, shredding, or melting. Intact or recognizable components and parts are not “scrap.”
                                </P>
                                <P>
                                    <E T="03">Serially-managed item</E>
                                     means an item designated by DoD to be uniquely tracked, controlled, or managed in maintenance, repair, and/or supply systems by means of its serial number or unique item identifier.
                                </P>
                                <P>
                                    <E T="03">Serviceable or usable property</E>
                                     means property with potential for reutilization or sale as is or with minor repairs or alterations.
                                </P>
                                <P>
                                    <E T="03">Supply condition code</E>
                                     means a classification of materiel in terms of readiness for issue and use or to identify action underway to change the status of materiel.
                                </P>
                                <P>
                                    <E T="03">Unique item identifier (UII)</E>
                                     means a set of data elements marked on an item that is globally unique and unambiguous. The term includes a concatenated UII or a DoD recognized unique identification equivalent.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Reporting Government property.</E>
                                     (1) The Contractor shall use the Government Furnished Property (GFP) module of the Procurement Integrated Enterprise Environment (PIEE) to—
                                </P>
                                <P>(i) Report receipt of GFP;</P>
                                <P>(ii) Report the transfer of GFP to another DoD contract;</P>
                                <P>(iii) Report the shipment of GFP to the Government or to a contractor. The GFP module generates the electronic equivalent of the DD Form 1149, DD Form 1348-1, or other required shipping documents;</P>
                                <P>(iv) Report when serially-managed items of GFP are incorporated into a higher-level component, assembly, or end item;</P>
                                <P>(v) Report the loss of Government property in accordance with paragraph (f)(1)(vii) of the FAR 52.245-1 clause of this contract;</P>
                                <P>(vi) Complete the plant clearance inventory schedule in accordance with paragraph (j)(2) of the FAR 52.245-1 clause of this contract, unless disposition instructions are otherwise included in this contract. The GFP module generates the electronic equivalent of the Standard Form (SF) 1428, Inventory Disposal Schedule; and</P>
                                <P>(vii) Submit a request to buy back or to convert to GFP items of Contractor-acquired property.</P>
                                <P>
                                    (2) Information regarding the GFP module is available in the GFP Module Vendor Guide at 
                                    <E T="03">https://dodprocurementtoolbox.com/site-pages/gfp-resources.</E>
                                     Users may also register for access to the GFP module and obtain training on the PIEE home page at 
                                    <E T="03">https://piee.eb.mil.</E>
                                </P>
                                <P>(3) In complying with paragraphs (b)(1)(i) through (iv) of this clause, the Contractor shall report the updated status of the property to the GFP module within 7 business days of the date the change in status occurs, unless otherwise specified in the contract.</P>
                                <P>(4) The Contractor shall use Wide Area WorkFlow in accordance with DFARS Appendix F, Material Inspection and Receiving Report, to report the shipment of reparable items after completion of repair, maintenance, modification, or overhaul.</P>
                                <P>(5) When Government property is in the possession of subcontractors, the Contractor shall ensure that reporting is accomplished using the data elements required in paragraph (c) of this clause.</P>
                                <P>
                                    (c) 
                                    <E T="03">Records of Government property.</E>
                                     To facilitate reporting of Government property to the GFP module, the Contractor's property records, in addition to the requirements of paragraph (f)(1)(iii) of the FAR 52.245-1 clause of this contract, shall enable recording of the following data elements:
                                </P>
                                <P>(1) National stock number (NSN). If an NSN is not available, use either the combination of the manufacturer's CAGE code and part number, or model number.</P>
                                <P>(2) CAGE code on the accountable Government contract.</P>
                                <P>(3) Received/sent (shipped) date.</P>
                                <P>
                                    (4) Accountable Government contract number.
                                    <PRTPAGE P="733"/>
                                </P>
                                <P>(5) Serial number (for serially-managed items that do not have a UII); and</P>
                                <P>
                                    (6) Supply condition code (only required for reporting of reparable items). For information on Federal supply condition codes, see DLM 4000.25, Defense Logistics Management Standards (DLMS), Volume 2, Supply Standards and Procedures, Appendix 2.5 at 
                                    <E T="03">https://www.dla.mil/HQ/InformationOperations/DLMS/elibrary/manuals/v2/.</E>
                                </P>
                                <P>
                                    (d) 
                                    <E T="03">Marking, reporting, and UII registration of GFP requirements.</E>
                                     The Contractor—
                                </P>
                                <P>(1) Shall assign the UII and mark the reparable items identified as serially managed in the GFP attachment to this contract with an item unique identification (IUID) data matrix, when the technical drawing for the item is accessible to the Contractor and includes IUID data matrix location and marking method;</P>
                                <P>(2) Shall report the UII either before or during shipment of the repaired item;</P>
                                <P>(3) Is not required to mark items that were previously marked with an IUID data matrix and registered in accordance with DFARS 252.211-7003, Item Unique Identification and Valuation; and</P>
                                <P>(4) Shall assign a new UII, then mark and register the item, when the conditions of paragraph (d)(1) are met, if an item is found to be marked but not registered in the IUID Registry.</P>
                                <P>
                                    (e) 
                                    <E T="03">Disposing of Government property.</E>
                                     (1) The Contractor shall complete the plant clearance inventory schedule using the plant clearance capability of the GFP module of the PIEE to generate an electronic equivalent of the SF 1428, Inventory Disposal Schedule. The plant clearance inventory schedule requires the following:
                                </P>
                                <P>(i) If known, the applicable Federal supply code (FSC) for all items, except items in scrap condition.</P>
                                <P>(ii) If known, the manufacturer name for all aircraft components under Federal supply group 16 or 17 and FSCs 2620, 2810, 2915, 2925, 2935, 2945, 2995, 4920, 5821, 5826, 5841, 6340, and 6615.</P>
                                <P>(iii) The manufacturer name, make, model number, model year, and serial number for all aircraft under FSCs 1510 and 1520.</P>
                                <P>(2) If the schedules are acceptable, the plant clearance officer will confirm acceptance in the GFP module plant clearance capability, which will transmit a notification to the Contractor. The electronic acceptance is equivalent to the DD Form 1637, Notice of Acceptance of Inventory.</P>
                                <P>
                                    (f) 
                                    <E T="03">Demilitarization, mutilation, and destruction.</E>
                                     If demilitarization, mutilation, or destruction of contractor inventory is required, the Contractor shall demilitarize, mutilate, or destroy contractor inventory, in accordance with the terms and conditions of the contract and consistent with Defense Demilitarization Manual, DoD Manual (DoDM) 4160.28-M, edition in effect as of the date of this contract. If the property is available for purchase, the plant clearance officer may authorize the purchaser to demilitarize, mutilate, or destroy as a condition of sale provided the property is not inherently dangerous to public health and safety.
                                </P>
                                <P>
                                    (g) 
                                    <E T="03">Classified Contractor inventory.</E>
                                     The Contractor shall dispose of classified contractor inventory in accordance with applicable security guides and regulations or as directed by the Contracting Officer.
                                </P>
                                <P>
                                    (h) 
                                    <E T="03">Inherently dangerous Contractor inventory.</E>
                                     Contractor inventory that is dangerous to public health or safety shall not be disposed of unless rendered innocuous or until adequate safeguards are provided.
                                </P>
                                <P>
                                    (i) 
                                    <E T="03">Contractor inventory located in foreign countries.</E>
                                     Consistent with contract terms and conditions, property disposition shall be in accordance with foreign and U.S. laws and regulations, including laws and regulations involving export controls, host nation requirements, final governing standards, and government-to-government agreements. The Contractor's responsibility to comply with all applicable laws and regulations regarding export-controlled items exists independent of, and is not established or limited by, the information provided by this clause.
                                </P>
                                <P>
                                    (j) 
                                    <E T="03">Disposal of scrap</E>
                                    —(1) 
                                    <E T="03">Contractor scrap procedures.</E>
                                     (i) The Contractor shall include, within its property management procedure, a process for the accountability and management of Government-owned scrap. The process shall, at a minimum, provide for the effective and efficient disposition of scrap, including sales to scrap dealers, so as to minimize costs, maximize sales proceeds, and contain the necessary internal controls for mitigating the improper release of non-scrap property.
                                </P>
                                <P>(ii) The Contractor may commingle Government and contractor-owned scrap and provide routine disposal of scrap, with plant clearance officer concurrence, when determined to be effective and efficient.</P>
                                <P>
                                    (2) 
                                    <E T="03">Scrap warranty.</E>
                                     The plant clearance officer may require the Contractor to secure from scrap buyers a DD Form 1639, Scrap Warranty.
                                </P>
                                <P>
                                    (k) 
                                    <E T="03">Sale of surplus Contractor inventory</E>
                                    —(1)
                                    <E T="03">Sales procedures.</E>
                                     (i) The Contractor shall conduct sales of contractor inventory (both useable property and scrap) in accordance with the requirements of this contract and plant clearance officer direction. The Contractor shall include in its invitation for bids the sales terms and conditions provided by the plant clearance officer.
                                </P>
                                <P>(ii) The Contractor may conduct internet-based sales, to include use of a third party.</P>
                                <P>
                                    (iii) If the Contractor wishes to bid on the sale, the Contractor or its employees shall submit bids to the plant clearance officer prior to soliciting bids from other prospective bidders.
                                    <PRTPAGE P="734"/>
                                </P>
                                <P>(iv) The Contractor shall solicit bids to obtain adequate competition. Negotiated sales are subject to obtaining such competition as is feasible under the circumstances of the negotiated sale.</P>
                                <P>(v) The Contractor shall solicit bids at least 15 calendar days before bid opening to allow adequate opportunity to inspect the property and prepare bids.</P>
                                <P>(vi) For large sales, the Contractor may use summary lists of items offered as bid sheets with detailed descriptions attached.</P>
                                <P>
                                    (vii) In addition to providing notice of the proposed sale to prospective bidders, the Contractor may, when the results are expected to justify the additional expense, display a notice of the proposed sale in appropriate public places, 
                                    <E T="03">e.g.,</E>
                                     publish a sales notice on the internet, in appropriate trade journals or magazines, and in local newspapers.
                                </P>
                                <P>(viii) The plant clearance officer or designated Government representative will witness the bid opening. The Contractor shall submit the bid abstract in electronic format to the plant clearance officer within 2 days of bid opening. If the Contractor is unable to submit the bid abstract electronically, the Contractor may submit 2 copies of the abstract manually within 2 days of bid opening. The plant clearance officer will not approve award to any bidder who is an ineligible transferee.</P>
                                <P>
                                    (2) 
                                    <E T="03">Required terms and conditions for sales contracts.</E>
                                     The Contractor shall include the following terms and conditions in sales contracts:
                                </P>
                                <P>(i) For sales contracts or other documents transferring title:</P>
                                <P>
                                    “The Purchaser certifies that the property covered by this contract will be used in 
                                    <E T="03">[insert name of country].</E>
                                     In the event of resale or export by the Purchaser of any of the property, the Purchaser agrees to obtain the appropriate U.S. and foreign export or re-export license approval.”
                                </P>
                                <P>(ii) For sales contracts that require demilitarization, mutilation, or destruction of property:</P>
                                <P>
                                    “The following items 
                                    <E T="03">[insert list provided by plant clearance officer]</E>
                                     require demilitarization, mutilation, or destruction by the Purchaser. Additional instructions are provided in accordance with Defense Demilitarization Manual, DoDM 4160.28-M, edition in effect as of the date of this sales contract. A Government representative will certify and verify demilitarization of items. Prepare demilitarization certificates in accordance with DoDM 4160.28, Volume 2, section 4.5, DEMIL Certificate (see figure 2, Example DEMIL Certificate).”
                                </P>
                                <P>(iii) Removal and title transfer:</P>
                                <P>“Property requiring demilitarization shall not be removed, and title shall not pass to the Purchaser, until demilitarization has been accomplished and verified by a Government representative.”</P>
                                <P>(iv) Assumption of cost incident to demilitarization:</P>
                                <P>“The Purchaser agrees to assume all costs incident to the demilitarization and to restore the working area to its present condition after removing the demilitarized property.”</P>
                                <P>(v) Failure to demilitarize:</P>
                                <P>“If the Purchaser fails to demilitarize, mutilate, or destroy the property as specified in the sales contract, the Contractor may, upon giving 10 days written notice to the Purchaser—</P>
                                <P>(A) Repossess, demilitarize, and return the property to the Purchaser, in which case the Purchaser hereby agrees to pay to the Contractor, prior to the return of the property, all costs incurred by the Contractor in repossessing, demilitarizing, and returning the property;</P>
                                <P>(B) Repossess, demilitarize, and resell the property, and charge the defaulting Purchaser with all costs incurred by the Contractor. The Contractor shall deduct these costs from the purchase price and refund the balance of the purchase price, if any, to the Purchaser. In the event the costs exceed the purchase price, the defaulting Purchaser hereby agrees to pay these costs to the Contractor; or</P>
                                <P>(C) Repossess and resell the property under similar terms and conditions, and charge the defaulting Purchaser with all costs incurred by the Contractor. The Contractor shall deduct these costs from the original purchase price and refund the balance of the purchase price, if any, to the defaulting Purchaser. Should the excess costs to the Contractor exceed the purchase price, the defaulting Purchaser hereby agrees to pay these costs to the Contractor.”</P>
                                <P>
                                    (l) 
                                    <E T="03">Restrictions on purchase or retention of Contractor inventory.</E>
                                     The Contractor may not knowingly sell the inventory to any person or that person's agent, employee, or household member if that person—
                                </P>
                                <P>(1) Is a civilian employee of DoD or the U.S. Coast Guard;</P>
                                <P>(2) Is a member of the Armed Forces of the United States, including the U.S. Coast Guard; or</P>
                                <P>(3) Has any functional or supervisory responsibilities for or within DoD's property disposal, disposition, or plant clearance programs or for the disposal of contractor inventory.</P>
                                <P>
                                    (m) 
                                    <E T="03">Proceeds from sales of surplus property.</E>
                                     Unless otherwise provided in the contract, the proceeds of any sale, purchase, or retention shall be—
                                </P>
                                <P>(1) Forwarded to the Contracting Officer;</P>
                                <P>
                                    (2) Credited to the Government as part of the settlement agreement pursuant to the termination of the contract;
                                    <PRTPAGE P="735"/>
                                </P>
                                <P>(3) Credited to the price or cost of the contract; or</P>
                                <P>(4) Applied as otherwise directed by the Contracting Officer.</P>
                            </EXTRACT>
                            <FP>(End of clause)</FP>
                            <CITA>[88 FR 88537, Dec. 22, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.246-7000</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.246-7001</SECTNO>
                            <SUBJECT>Warranty of data.</SUBJECT>
                            <P>
                                <E T="03">Basic.</E>
                                 As prescribed in 246.710(1) and (1)(i), use the following clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Warranty of Data—Basic (MAR 2014)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition—Technical data</E>
                                     has the same meaning as given in the clause in this contract entitled, Rights in Technical Data and Computer Software.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Warranty.</E>
                                     Notwithstanding inspection and acceptance by the Government of technical data furnished under this contract, and notwithstanding any provision of this contract concerning the conclusiveness of acceptance, the Contractor warrants that all technical data delivered under this contract will at the time of delivery conform with the specifications and all other requirements of this contract. The warranty period shall extend for three years after completion of the delivery of the line item of data (as identified in DD Form 1423, Contract Data Requirements List) of which the data forms a part; or any longer period specified in the contract.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Contractor notification.</E>
                                     The Contractor agrees to notify the Contracting Officer in writing immediately of any breach of the above warranty which the Contractor discovers within the warranty period.
                                </P>
                                <P>
                                    (d) 
                                    <E T="03">Remedies.</E>
                                     The following remedies shall apply to all breaches of the warranty, whether the Contractor notifies the Contracting Officer in accordance with paragraph (c) of this clause or if the Government notifies the Contractor of the breach in writing within the warranty period:
                                </P>
                                <P>(1) Within a reasonable time after such notification, the Contracting Officer may—</P>
                                <P>(i) By written notice, direct the Contractor to correct or replace at the Contractor's expense the nonconforming technical data promptly; or</P>
                                <P>(ii) If the Contracting Officer determines that the Government no longer has a requirement for correction or replacement of the data, or that the data can be more reasonably corrected by the Government, inform the Contractor by written notice that the Government elects a price or fee adjustment instead of correction or replacement.</P>
                                <P>(2) If the Contractor refuses or fails to comply with a direction under paragraph (d) (1)(i) of this clause, the Contracting Officer may, within a reasonable time of the refusal or failure—</P>
                                <P>(i) By contract or otherwise, correct or replace the nonconforming technical data and charge the cost to the Contractor; or</P>
                                <P>(ii) Elect a price or fee adjustment instead of correction or replacement.</P>
                                <P>(3) The remedies in this clause represent the only way to enforce the Government's rights under this clause.</P>
                                <P>(e) The provisions of this clause apply anew to that portion of any corrected or replaced technical data furnished to the Government under paragraph (d)(1)(i) of this clause.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate I.</E>
                                 As prescribed in 246.710(1) and (1)(ii), use the following clause, which uses a different paragraph (d)(3) than the basic clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Warranty of Data—Alternate I (MAR 2014)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition. Technical data</E>
                                     has the same meaning as given in the clause in this contract entitled “Rights in Technical Data and Computer Software.”
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Warranty.</E>
                                     Notwithstanding inspection and acceptance by the Government of technical data furnished under this contract, and notwithstanding any provision of this contract concerning the conclusiveness of acceptance, the Contractor warrants that all technical data delivered under this contract will at the time of delivery conform with the specifications and all other requirements of this contract. The warranty period shall extend for three years after completion of the delivery of the line item of data (as identified in DD Form 1423, Contract Data Requirements List) of which the data forms a part; or any longer period specified in the contract.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Contractor Notification.</E>
                                     The Contractor agrees to notify the Contracting Officer in writing immediately of any breach of the above warranty which the Contractor discovers within the warranty period.
                                </P>
                                <P>
                                    (d) 
                                    <E T="03">Remedies.</E>
                                     The following remedies shall apply to all breaches of the warranty, whether the Contractor notifies the Contracting Officer in accordance with paragraph (c) of this clause or if the Government notifies the Contractor of the breach in writing within the warranty period:
                                </P>
                                <P>(1) Within a reasonable time after such notification, the Contracting Officer may—</P>
                                <P>(i) By written notice, direct the Contractor to correct or replace at the Contractor's expense the nonconforming technical data promptly; or</P>
                                <P>
                                    (ii) If the Contracting Officer determines that the Government no longer has a requirement for correction or replacement of 
                                    <PRTPAGE P="736"/>
                                    the data, or that the data can be more reasonably corrected by the Government, inform the Contractor by written notice that the Government elects a price or fee adjustment instead of correction or replacement.
                                </P>
                                <P>(2) If the Contractor refuses or fails to comply with a direction under paragraph (d)(1)(i) of this clause, the Contracting Officer may, within a reasonable time of the refusal or failure—</P>
                                <P>(i) By contract or otherwise, correct or replace the nonconforming technical data and charge the cost to the Contractor; or</P>
                                <P>(ii) Elect a price or fee adjustment instead of correction or replacement.]</P>
                                <P>(3) In addition to the remedies under paragraphs (d)(1) and (2) of this clause, the Contractor shall be liable to the Government for all damages to the Government as a result of the breach of warranty.</P>
                                <P>(i) The additional liability under paragraph (d)(3) of this clause shall not exceed 75 percent of the target profit.</P>
                                <P>(ii) If the breach of the warranty is with respect to the data supplied by an equipment subcontractor, the limit of the Contractor's liability shall be—</P>
                                <P>(A) Ten percent of the total subcontract price in a firm-fixed-price subcontract;</P>
                                <P>(B) Seventy-five percent of the total subcontract fee in a cost-plus-fixed-fee or cost-plus-award-fee subcontract; or</P>
                                <P>(C) Seventy-five percent of the total subcontract target profit or fee in a fixed-price-incentive or cost-plus-incentive subcontract.</P>
                                <P>(iii) Damages due the Government under the provisions of this warranty are not an allowable cost.</P>
                                <P>(iv) The additional liability in paragraph (d)(3) of this clause shall not apply—</P>
                                <P>(A) With respect to the requirements for product drawings and associated lists, special inspection equipment (SIE) drawings and associated lists, special tooling drawings and associated lists, SIE operating instructions, SIE descriptive documentation, and SIE calibration procedures under MIL-T-31000, General Specification for Technical Data Packages, Amendment 1, or MIL-T-47500, General Specification for Technical Data Packages, Supp 1, or drawings and associated lists under level 2 or level 3 of MIL-D-1000A, Engineering and Associated Data Drawings, or DoD-D-1000B, Engineering and Associated Lists Drawings (Inactive for New Design) Amendment 4, Notice 1; or drawings and associated lists under category E or I of MIL-D-1000, Engineering and Associated Lists Drawings, provided that the data furnished by the Contractor was current, accurate at time of submission, and did not involve a significant omission of data necessary to comply with the requirements; or</P>
                                <P>(B) To defects the Contractor discovers and gives written notice to the Government before the Government discovers the error.</P>
                                <P>(e) The provisions of this clause apply anew to that portion of any corrected or replaced technical data furnished to the Government under paragraph (d)(1)(i) of this clause.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate II.</E>
                                 As prescribed in 246.710(1) and (1)(iii), use the following clause, which uses a different paragraph (d)(3) than the basic clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Warranty of Data—Alternate II (MAR 2014)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition. Technical data</E>
                                     has the same meaning as given in the clause in this contract entitled “Rights in Technical Data and Computer Software.”
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Warranty.</E>
                                     Notwithstanding inspection and acceptance by the Government of technical data furnished under this contract, and notwithstanding any provision of this contract concerning the conclusiveness of acceptance, the Contractor warrants that all technical data delivered under this contract will at the time of delivery conform with the specifications and all other requirements of this contract. The warranty period shall extend for three years after completion of the delivery of the line item of data (as identified in DD Form 1423, Contract Data Requirements List) of which the data forms a part; or any longer period specified in the contract.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Contractor Notification.</E>
                                     The Contractor agrees to notify the Contracting Officer in writing immediately of any breach of the above warranty which the Contractor discovers within the warranty period.
                                </P>
                                <P>
                                    (d) 
                                    <E T="03">Remedies.</E>
                                     The following remedies shall apply to all breaches of the warranty, whether the Contractor notifies the Contracting Officer in accordance with paragraph (c) of this clause or if the Government notifies the Contractor of the breach in writing within the warranty period:
                                </P>
                                <P>(1) Within a reasonable time after such notification, the Contracting Officer may—</P>
                                <P>(i) By written notice, direct the Contractor to correct or replace at the Contractor's expense the nonconforming technical data promptly; or</P>
                                <P>(ii) If the Contracting Officer determines that the Government no longer has a requirement for correction or replacement of the data, or that the data can be more reasonably corrected by the Government, inform the Contractor by written notice that the Government elects a price or fee adjustment instead of correction or replacement.</P>
                                <P>
                                    (2) If the Contractor refuses or fails to comply with a direction under paragraph 
                                    <PRTPAGE P="737"/>
                                    (d)(1)(i) of this clause, the Contracting Officer may, within a reasonable time of the refusal or failure—
                                </P>
                                <P>(i) By contract or otherwise, correct or replace the nonconforming technical data and charge the cost to the Contractor; or</P>
                                <P>(ii) Elect a price or fee adjustment instead of correction or replacement.</P>
                                <P>(3) In addition to the remedies under paragraphs (d)(1) and (2) of this clause, the Contractor shall be liable to the Government for all damages to the Government as a result of the breach of the warranty.</P>
                                <P>(i) The additional liability under paragraph (d)(3) of this clause shall not exceed ten percent of the total contract price.</P>
                                <P>(ii) If the breach of the warranty is with respect to the data supplied by an equipment subcontractor, the limit of the Contractor's liability shall be—</P>
                                <P>(A) Ten percent of the total subcontract price in a firm[-]fixed[-]price subcontract;</P>
                                <P>(B) Seventy-five percent of the total subcontract fee in a cost-plus-fixed-fee or cost-plus-award-fee subcontract; or</P>
                                <P>(C) Seventy-five percent of the total subcontract target profit or fee in a fixed-price-incentive or cost-plus-incentive subcontract.</P>
                                <P>(iii) The additional liability specified in paragraph (d)(3) of this clause shall not apply—</P>
                                <P>(A) With respect to the requirements for product drawings and associated lists, special inspection equipment (SIE) drawings and associated lists, special tooling drawings and associated lists, SIE operating instructions, SIE descriptive documentation, and SIE calibration procedures under MIL-T-31000, General Specification for Technical Data Packages, Amendment 1, or MIL-T-47500, General Specification for Technical Data Packages, Supp 1, or drawings and associated lists under level 2 or level 3 of MIL-D-1000A, Engineering and Associated Data Drawings, or DoD-D-1000B, Engineering and Associated Lists Drawings (Inactive for New Design) Amendment 4, Notice 1; or drawings and associated lists under category E or I of MIL-D-1000, Engineering and Associated Lists Drawings, provided that the data furnished by the Contractor was current, accurate at time of submission, and did not involve a significant omission of data necessary to comply with the requirements; or</P>
                                <P>(B) To defects the Contractor discovers and gives written notice to the Government before the Government discovers the error.</P>
                                <P>(e) The provisions of this clause apply anew to that portion of any corrected or replaced technical data furnished to the Government under paragraph (d)(1)(i) of this clause.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 79 FR 17449, Mar. 28, 2014; 80 FR 36900, June 26, 2015]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.246-7002</SECTNO>
                            <SUBJECT>Warranty of construction (Germany).</SUBJECT>
                            <P>As prescribed in 246.710(2), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Warranty of Construction (Germany) (JUN 1997)</HD>
                                <P>(a) In addition to any other representations in this contract, the Contractor warrants, except as provided in paragraph (j) of this clause, that the work performed under this contract conforms to the contract requirements and is free of any defect of equipment, material, or design furnished or workmanship performed by the Contractor or any subcontractor or supplier at any tier.</P>
                                <P>(b) This warranty shall continue for the period(s) specified in Section 13, VOB, Part B, commencing from the date of final acceptance of the work under this contract. If the Government takes possession of any part of the work before final acceptance, this warranty shall continue for the period(s) specified in Section 13, VOB, Part B, from the date the Government takes possession.</P>
                                <P>(c) The Contractor shall remedy, at the Contractor's expense, any failure to conform or any defect. In addition, the Contractor shall remedy, at the Contractor's expense, any damage to Government-owned or -controlled real or personal property when that damage is the result of—</P>
                                <P>(1) The Contractor's failure to conform to contract requirements; or</P>
                                <P>(2) Any defect of equipment, material, or design furnished or workmanship performed.</P>
                                <P>(d) The Contractor shall restore any work damaged in fulfilling the terms and conditions of this clause.</P>
                                <P>(e) The Contracting Officer shall notify the Contractor, in writing, within a reasonable period of time after the discovery of any failure, defect, or damage.</P>
                                <P>(f) If the Contractor fails to remedy any failure, defect, or damage within a reasonable period of time after receipt of notice, the Government shall have the right to replace, repair, or otherwise remedy the failure, defect, or damage at the Contractor's expense.</P>
                                <P>(g) With respect to all warranties, express or implied, from subcontractors, manufacturers, or suppliers for work performed and materials furnished under this contract, the Contractor shall—</P>
                                <P>(1) Obtain all warranties that would be given in normal commercial practice;</P>
                                <P>
                                    (2) Require all warranties to be executed in writing, for the benefit of the Government, if directed by the Contracting Officer; and
                                    <PRTPAGE P="738"/>
                                </P>
                                <P>(3) Enforce all warranties for the benefit of the Government as directed by the Contracting Officer.</P>
                                <P>(h) In the event the Contractor's warranty under paragraph (b) of this clause has expired, the Government may bring suit at its expense to enforce a subcontractor's, manufacturer's, or supplier's warranty.</P>
                                <P>(i) Unless a defect is caused by the Contractor's negligence, or the negligence of a subcontractor or supplier at any tier, the Contractor shall not be liable for the repair of any defects of material or design furnished by the Government or for the repair of any damage resulting from any defeat in Government-furnished material or design.</P>
                                <P>(j) This warranty shall not limit the Government's right under the Inspection clause of this contract, with respect to latent defects, gross mistakes, or fraud.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[62 FR 34135, June 24, 1997; 62 FR 49306, Sept. 19, 1997; 79 FR 17450, Mar. 28, 2014]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.246-7003</SECTNO>
                            <SUBJECT>Notification of Potential Safety Issues.</SUBJECT>
                            <P>As prescribed in 246.370(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Notification of Potential Safety Issues (JAN 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Credible information</E>
                                     means information that, considering its source and the surrounding circumstances, supports a reasonable belief that an event has occurred or will occur.
                                </P>
                                <P>
                                    <E T="03">Critical safety item</E>
                                     means a part, subassembly, assembly, subsystem, installation equipment, or support equipment for a system that contains a characteristic, any failure, malfunction, or absence of which could have a safety impact.
                                </P>
                                <P>
                                    <E T="03">Safety impact</E>
                                     means the occurrence of death, permanent total disability, permanent partial disability, or injury or occupational illness requiring hospitalization; loss of a weapon system; or property damage exceeding $1,000,000.
                                </P>
                                <P>
                                    <E T="03">Subcontractor</E>
                                     means any supplier, distributor, vendor, or firm that furnishes supplies or services to or for the Contractor or another subcontractor under this contract.
                                </P>
                                <P>(b) The Contractor shall provide notification, in accordance with paragraph (c) of this clause, of—</P>
                                <P>(1) All nonconformances for parts identified as critical safety items acquired by the Government under this contract; and</P>
                                <P>(2) All nonconformances or deficiencies that may result in a safety impact for systems, or subsystems, assemblies, subassemblies, or parts integral to a system, acquired by or serviced for the Government under this contract.</P>
                                <P>(c) The Contractor—</P>
                                <P>(1) Shall notify the Administrative Contracting Officer (ACO) and the Procuring Contracting Officer (PCO) as soon as practicable, but not later than 72 hours, after discovering or acquiring credible information concerning nonconformances and deficiencies described in paragraph (b) of this clause; and</P>
                                <P>(2) Shall provide a written notification to the ACO and the PCO within 5 working days that includes—</P>
                                <P>(i) A summary of the defect or nonconformance;</P>
                                <P>(ii) A chronology of pertinent events;</P>
                                <P>(iii) The identification of potentially affected items to the extent known at the time of notification;</P>
                                <P>(iv) A point of contact to coordinate problem analysis and resolution; and</P>
                                <P>(v) Any other relevant information.</P>
                                <P>(d) The Contractor—</P>
                                <P>(1) Is responsible for the notification of potential safety issues occurring with regard to an item furnished by any subcontractor; and</P>
                                <P>(2) Shall facilitate direct communication between the Government and the subcontractor as necessary.</P>
                                <P>(e) Notification of safety issues under this clause shall be considered neither an admission of responsibility nor a release of liability for the defect or its consequences. This clause does not affect any right of the Government or the Contractor established elsewhere in this contract.</P>
                                <P>
                                    (f)(1) 
                                    <E T="03">Subcontracts.</E>
                                     The Contractor shall include the substance of this clause, including this paragraph (f), in subcontracts for—
                                </P>
                                <P>(i) Parts identified as critical safety items;</P>
                                <P>(ii) Systems and subsystems, assemblies, and subassemblies integral to a system; or</P>
                                <P>(iii) Repair, maintenance, logistics support, or overhaul services for systems and subsystems, assemblies, subassemblies, and parts integral to a system.</P>
                                <P>(2) For those subcontracts, including subcontracts for commercial products or commercial services, described in paragraph (f)(1) of this clause, the Contractor shall require the subcontractor to provide the notification required by paragraph (c) of this clause to—</P>
                                <P>(i) The Contractor or higher-tier subcontractor; and</P>
                                <P>(ii) The ACO and the PCO, if the subcontractor is aware of the ACO and the PCO for the contract.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[72 FR 2636, Jan. 22, 2007, as amended at 78 FR 37991, June 25, 2013; 83 FR 66065, Dec. 21, 2018; 88 FR 6596, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="739"/>
                            <SECTNO>252.246-7004</SECTNO>
                            <SUBJECT>Safety of Facilities, Infrastructure, and Equipment for Military Operations.</SUBJECT>
                            <P>As prescribed in 246.270-4, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Safety of Facilities, Infrastructure, and Equipment for Military Operations (OCT 2010)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition. Discipline Working Group,</E>
                                     as used in this clause, means representatives from the DoD Components, as defined in MIL-STD-3007F, who are responsible for the unification and maintenance of the Unified Facilities Criteria (UFC) documents for a particular discipline area.
                                </P>
                                <P>(b) The Contractor shall ensure, consistent with the requirements of the applicable inspection clause in this contract, that the facilities, infrastructure, and equipment acquired, constructed, installed, repaired, maintained, or operated under this contract comply with Unified Facilities Criteria (UFC) 1-200-01 for—</P>
                                <P>(1) Fire protection;</P>
                                <P>(2) Structural integrity;</P>
                                <P>(3) Electrical systems;</P>
                                <P>(4) Plumbing;</P>
                                <P>(5) Water treatment;</P>
                                <P>(6) Waste disposal; and</P>
                                <P>(7) Telecommunications networks.</P>
                                <P>(c) The Contractor may apply a standard equivalent to or more stringent than UFC 1-200-01 upon a written determination of the acceptability of the standard by the Contracting Officer with the concurrence of the relevant Discipline Working Group.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[75 FR 66685, Oct. 29, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.246-7005</SECTNO>
                            <SUBJECT>Notice of Warranty Tracking of Serialized Items.</SUBJECT>
                            <P>As prescribed in 246.710(3)(i), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Notice of Warranty Tracking of Serialized Items (MAR 2016)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions. Duration,</E>
                                     
                                    <E T="03">enterprise, enterprise identifier,</E>
                                     
                                    <E T="03">fixed expiration, item type,</E>
                                     
                                    <E T="03">serialized item, starting event,</E>
                                     
                                    <E T="03">unique item identifier, usage,</E>
                                     
                                    <E T="03">warranty administrator, warranty guarantor,</E>
                                     and 
                                    <E T="03">warranty tracking</E>
                                     are defined in the clause at 252.246-7006, Warranty Tracking of Serialized Items.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Reporting of data for warranty tracking and administration.</E>
                                     (1) The Offeror shall provide the information required by the attachment entitled “Warranty Tracking Information” on each contract line item number, subline item number, or exhibit line item number for warranted items with its offer. Information required in the warranty attachment for each warranted item shall include such information as duration, fixed expiration, item type, starting event, usage, warranty administrator enterprise identifier, and warranty guarantor enterprise identifier.
                                </P>
                                <P>(2) The successful offeror will be required to provide the following information no later than when the warranted items are presented for receipt and/or acceptance, in accordance with the clause at 252.246-7006—</P>
                                <P>(i) The unique item identifier for each warranted item required by the attachment entitled “Warranty Tracking Information;” and</P>
                                <P>(ii) All information required by the attachment entitled “Source of Repair Instructions” for each warranted item.</P>
                                <P>
                                    (3) For additional information on warranty attachments, see the “Warranty and Source of Repair” training and “Warranty and Source of Repair Tracking User Guide” accessible on the Product Data Reporting and Evaluation Program (PDREP) Web site at 
                                    <E T="03">https://www.pdrep.csd.disa.mil/pdrep_files/other/wsr.htm.</E>
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[76 FR 33170, June 8, 2011, as amended at 79 FR 17450, Mar. 28, 2014; 81 FR 17043, Mar. 25, 2016]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.246-7006</SECTNO>
                            <SUBJECT>Warranty Tracking of Serialized Items.</SUBJECT>
                            <P>As prescribed in 246.710(3)(ii), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Warranty Tracking of Serialized Items (MAR 2016)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Duration</E>
                                     means the warranty period. This period may be a stated period of time, amount of usage, or the occurrence of a specified event, after formal acceptance of delivery, for the Government to assert a contractual right for the correction of defects.
                                </P>
                                <P>
                                    <E T="03">Enterprise</E>
                                     means the entity (
                                    <E T="03">e.g.,</E>
                                     a manufacturer or vendor) responsible for granting the warranty and/or assigning unique item identifiers to serialized warranty items.
                                </P>
                                <P>
                                    <E T="03">Enterprise identifier</E>
                                     means a code that is uniquely assigned to an enterprise by an issuing agency.
                                </P>
                                <P>
                                    <E T="03">First use</E>
                                     means the initial or first-time use of a product by the Government.
                                </P>
                                <P>
                                    <E T="03">Fixed expiration</E>
                                     means the date the warranty expires and the Contractor's obligation to provide for a remedy or corrective action ends.
                                </P>
                                <P>
                                    <E T="03">Installation</E>
                                     means the date a unit is inserted into a higher level assembly in order to make that assembly operational.
                                </P>
                                <P>
                                    <E T="03">Issuing agency</E>
                                     means an organization responsible for assigning a globally unique identifier to an enterprise, as indicated in the Register of Issuing Agency Codes for 
                                    <PRTPAGE P="740"/>
                                    International Standards Organization/International Electrotechnical Commission 15459, located at 
                                    <E T="03">http://www.aimglobal.org/?Reg_Authority15459.</E>
                                </P>
                                <P>
                                    <E T="03">Item type</E>
                                     means a coded representation of the description of the item being warranted, consisting of the codes C—component procured separate from end item, S—subassembly procured separate from end item or subassembly, E—embedded in component, subassembly or end item parent, and P—parent end item.
                                </P>
                                <P>
                                    <E T="03">Starting event</E>
                                     means the event or action that initiates the warranty, such as first use or upon installation.
                                </P>
                                <P>
                                    <E T="03">Serialized item</E>
                                     means each item produced is assigned a serial number that is unique among all the collective tangible items produced by the enterprise, or each item of a particular part, lot, or batch number is assigned a unique serial number within that part, lot, or batch number assignment within the enterprise identifier. The enterprise is responsible for ensuring unique serialization within the enterprise identifier or within the part, lot, or batch numbers, and that serial numbers, once assigned, are never used again.
                                </P>
                                <P>
                                    <E T="03">Unique item identifier</E>
                                     means a set of data elements marked on an item that is globally unique and unambiguous.
                                </P>
                                <P>
                                    <E T="03">Usage</E>
                                     means the quantity and an associated unit of measure that specifies the amount of a characteristic subject to the contractor's obligation to provide for remedy or corrective action, such as a number of miles, hours, or cycles.
                                </P>
                                <P>
                                    <E T="03">Warranty administrator</E>
                                     means the organization specified by the guarantor for managing the warranty.
                                </P>
                                <P>
                                    <E T="03">Warranty guarantor</E>
                                     means the enterprise that provides the warranty under the terms and conditions of a contract.
                                </P>
                                <P>
                                    <E T="03">Warranty repair source</E>
                                     means the organization specified by a warranty guarantor for receiving and managing warranty items that are returned by a customer.
                                </P>
                                <P>
                                    <E T="03">Warranty tracking</E>
                                     means the ability to trace a warranted item from delivery through completion of the effectivity of the warranty.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Reporting of data for warranty tracking and administration.</E>
                                     (1) The Contractor shall provide the information required by the attachment entitled “Warranty Tracking Information” on each contract line item number, subline item number, or exhibit line item number for warranted items no later than the time of award. Information required in the warranty attachment shall include such information as duration, fixed expiration, item type, starting event, usage, warranty administrator enterprise identifier, and warranty guarantor enterprise identifier.
                                </P>
                                <P>(2) The Contractor shall provide the following information no later than when the warranted items are presented for receipt and/or acceptance—</P>
                                <P>(i) The unique item identifier for each warranted item required by the attachment entitled “Warranty Tracking Information;” and</P>
                                <P>(ii) The warranty repair source information and instructions for each warranted item required by the attachment entitled “Source of Repair Instructions.”</P>
                                <P>(3) The Contractor shall submit the data for warranty tracking to the Contracting Officer with a copy to the requiring activity and the Contracting Officer Representative.</P>
                                <P>
                                    (4) For additional information on warranty attachments, see the “Warranty and Source of Repair” training and “Warranty and Source of Repair Tracking User Guide” accessible on the Product Data Reporting and Evaluation Program (PDREP) Web site at 
                                    <E T="03">https://www.pdrep.csd.disa.mil/pdrep_files/other/wsr.htm.</E>
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Reservation of rights.</E>
                                     The terms of this clause shall not be construed to limit the Government's rights or remedies under any other contract clause.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[76 FR 33170, June 8, 2011, as amended at 79 FR 17450, Mar. 28, 2014; 81 FR 17044, Mar. 25, 2016]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.246-7007</SECTNO>
                            <SUBJECT>Contractor Counterfeit Electronic Part Detection and Avoidance System.</SUBJECT>
                            <P>As prescribed in 246.870-3(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Contractor Counterfeit Electronic Part Detection and Avoidance System (JAN 2023)</HD>
                                <P>The following paragraphs (a) through (e) of this clause do not apply unless the Contractor is subject to the Cost Accounting Standards under 41 U.S.C. chapter 15, as implemented in regulations found at 48 CFR 9903.201-1.</P>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Authorized aftermarket manufacturer</E>
                                     means an organization that fabricates a part under a contract with, or with the express written authority of, the original component manufacturer based on the original component manufacturer's designs, formulas, and/or specifications.
                                </P>
                                <P>
                                    <E T="03">Authorized supplier</E>
                                     means a supplier, distributor, or an aftermarket manufacturer with a contractual arrangement with, or the express written authority of, the original manufacturer or current design activity to buy, stock, repackage, sell, or distribute the part.
                                    <PRTPAGE P="741"/>
                                </P>
                                <P>
                                    <E T="03">Contract manufacturer</E>
                                     means a company that produces goods under contract for another company under the label or brand name of that company.
                                </P>
                                <P>
                                    <E T="03">Contractor-approved supplier</E>
                                     means a supplier that does not have a contractual agreement with the original component manufacturer for a transaction, but has been identified as trustworthy by a contractor or subcontractor.
                                </P>
                                <P>
                                    <E T="03">Counterfeit electronic part</E>
                                     means an unlawful or unauthorized reproduction, substitution, or alteration that has been knowingly mismarked, misidentified, or otherwise misrepresented to be an authentic, unmodified electronic part from the original manufacturer, or a source with the express written authority of the original manufacturer or current design activity, including an authorized aftermarket manufacturer. Unlawful or unauthorized substitution includes used electronic parts represented as new, or the false identification of grade, serial number, lot number, date code, or performance characteristics.
                                </P>
                                <P>
                                    <E T="03">Electronic part</E>
                                     means an integrated circuit, a discrete electronic component (including, but not limited to, a transistor, capacitor, resistor, or diode), or a circuit assembly (section 818(f)(2) of Pub. L. 112-81). 
                                </P>
                                <P>
                                    <E T="03">Obsolete electronic part</E>
                                     means an electronic part that is no longer available from the original manufacturer or an authorized aftermarket manufacturer.
                                </P>
                                <P>
                                    <E T="03">Original component manufacturer</E>
                                     means an organization that designs and/or engineers a part and is entitled to any intellectual property rights to that part.
                                </P>
                                <P>
                                    <E T="03">Original equipment manufacturer</E>
                                     means a company that manufactures products that it has designed from purchased components and sells those products under the company's brand name.
                                </P>
                                <P>
                                    <E T="03">Original manufacturer</E>
                                     means the original component manufacturer, the original equipment manufacturer, or the contract manufacturer.
                                </P>
                                <P>
                                    <E T="03">Suspect counterfeit electronic part</E>
                                     means an electronic part for which credible evidence (including, but not limited to, visual inspection or testing) provides reasonable doubt that the electronic part is authentic.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Acceptable counterfeit electronic part detection and avoidance system.</E>
                                     The Contractor shall establish and maintain an acceptable counterfeit electronic part detection and avoidance system. Failure to maintain an acceptable counterfeit electronic part detection and avoidance system, as defined in this clause, may result in disapproval of the purchasing system by the Contracting Officer and/or withholding of payments and affect the allowability of costs of counterfeit electronic parts or suspect counterfeit electronic parts and the cost of rework or corrective action that may be required to remedy the use or inclusion of such parts (see DFARS 231.205-71).
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">System criteria.</E>
                                     A counterfeit electronic part detection and avoidance system shall include risk-based policies and procedures that address, at a minimum, the following areas:
                                </P>
                                <P>(1) The training of personnel.</P>
                                <P>(2) The inspection and testing of electronic parts, including criteria for acceptance and rejection. Tests and inspections shall be performed in accordance with accepted Government- and industry-recognized techniques. Selection of tests and inspections shall be based on minimizing risk to the Government. Determination of risk shall be based on the assessed probability of receiving a counterfeit electronic part; the probability that the inspection or test selected will detect a counterfeit electronic part; and the potential negative consequences of a counterfeit electronic part being installed (e.g., human safety, mission success) where such consequences are made known to the Contractor.</P>
                                <P>(3) Processes to abolish counterfeit parts proliferation.</P>
                                <P>(4) Risk-based processes that enable tracking of electronic parts from the original manufacturer to product acceptance by the Government, whether the electronic parts are supplied as discrete electronic parts or are contained in assemblies, in accordance with paragraph (c) of the clause at 252.246-7008, Sources of Electronic Parts (also see paragraph (c)(2) of this clause).</P>
                                <P>(5) Use of suppliers in accordance with the clause at 252.246-7008.</P>
                                <P>(6) Reporting and quarantining of counterfeit electronic parts and suspect counterfeit electronic parts. Reporting is required to the Contracting Officer and to the Government-Industry Data Exchange Program (GIDEP) when the Contractor becomes aware of, or has reason to suspect that, any electronic part or end item, component, part, or assembly containing electronic parts purchased by the DoD, or purchased by a Contractor for delivery to, or on behalf of, the DoD, contains counterfeit electronic parts or suspect counterfeit electronic parts. Counterfeit electronic parts and suspect counterfeit electronic parts shall not be returned to the seller or otherwise returned to the supply chain until such time that the parts are determined to be authentic.</P>
                                <P>(7) Methodologies to identify suspect counterfeit parts and to rapidly determine if a suspect counterfeit part is, in fact, counterfeit.</P>
                                <P>
                                    (8) Design, operation, and maintenance of systems to detect and avoid counterfeit electronic parts and suspect counterfeit electronic parts. The Contractor may elect to use current Government- or industry-recognized standards to meet this requirement.
                                    <PRTPAGE P="742"/>
                                </P>
                                <P>(9) Flowdown of counterfeit detection and avoidance requirements, including applicable system criteria provided herein, to subcontractors at all levels in the supply chain that are responsible for buying or selling electronic parts or assemblies containing electronic parts, or for performing authentication testing.</P>
                                <P>(10) Process for keeping continually informed of current counterfeiting information and trends, including detection and avoidance techniques contained in appropriate industry standards, and using such information and techniques for continuously upgrading internal processes.</P>
                                <P>(11) Process for screening GIDEP reports and other credible sources of counterfeiting information to avoid the purchase or use of counterfeit electronic parts.</P>
                                <P>(12) Control of obsolete electronic parts in order to maximize the availability and use of authentic, originally designed, and qualified electronic parts throughout the product's life cycle.</P>
                                <P>(d) Government review and evaluation of the Contractor's policies and procedures will be accomplished as part of the evaluation of the Contractor's purchasing system in accordance with 252.244-7001, Contractor Purchasing System Administration—Basic, or Contractor Purchasing System Administration—Alternate I.</P>
                                <P>
                                    (e) (e) 
                                    <E T="03">Subcontracts.</E>
                                     The Contractor shall include the substance of this clause, excluding the introductory text and including only paragraphs (a) through (e), in subcontracts, including subcontracts for  commercial products, for electronic parts or assemblies containing electronic parts.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[79 FR 26108, May 6, 2014, as amended at 81 FR 50649, Aug. 2, 2016; 88 FR 6596, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.246-7008</SECTNO>
                            <SUBJECT>Sources of Electronic Parts.</SUBJECT>
                            <P>As prescribed in 246.870-3(b), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Sources of Electronic Parts (JAN 2023)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Authorized aftermarket manufacturer</E>
                                     means an organization that fabricates a part under a contract with, or with the express written authority of, the original component manufacturer based on the original component manufacturer's designs, formulas, and/or specifications.
                                </P>
                                <P>
                                    <E T="03">Authorized supplier</E>
                                     means a supplier, distributor, or an aftermarket manufacturer with a contractual arrangement with, or the express written authority of, the original manufacturer or current design activity to buy, stock, repackage, sell, or distribute the part.
                                </P>
                                <P>
                                    <E T="03">Contract manufacturer</E>
                                     means a company that produces goods under contract for another company under the label or brand name of that company.
                                </P>
                                <P>
                                    <E T="03">Contractor-approved supplier</E>
                                     means a supplier that does not have a contractual agreement with the original component manufacturer for a transaction, but has been identified as trustworthy by a contractor or subcontractor.
                                </P>
                                <P>
                                    <E T="03">Electronic part</E>
                                     means an integrated circuit, a discrete electronic component (including, but not limited to, a transistor, capacitor, resistor, or diode), or a circuit assembly (section 818(f)(2) of Pub. L. 112-81).
                                </P>
                                <P>
                                    <E T="03">Original component manufacturer</E>
                                     means an organization that designs and/or engineers a part and is entitled to any intellectual property rights to that part.
                                </P>
                                <P>
                                    <E T="03">Original equipment manufacturer</E>
                                     means a company that manufactures products that it has designed from purchased components and sells those products under the company's brand name.
                                </P>
                                <P>
                                    <E T="03">Original manufacturer</E>
                                     means the original component manufacturer, the original equipment manufacturer, or the contract manufacturer.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Selecting suppliers.</E>
                                     In accordance with section 818(c)(3) of the National Defense Authorization Act for Fiscal Year 2012 (Pub. L. 112-81), as amended by section 817 of the National Defense Authorization Act for Fiscal Year 2015 (Pub. L. 113-291 and section 885 of the National Defense Authorization Act for Fiscal Year 2016 (Pub. L. 114-92)), the Contractor shall—
                                </P>
                                <P>(1) First obtain electronic parts that are in production by the original manufacturer or an authorized aftermarket manufacturer or currently available in stock from—</P>
                                <P>(i) The original manufacturers of the parts;</P>
                                <P>(ii) Their authorized suppliers; or</P>
                                <P>(iii) Suppliers that obtain such parts exclusively from the original manufacturers of the parts or their authorized suppliers;</P>
                                <P>(2) If electronic parts are not available as provided in paragraph (b)(1) of this clause, obtain electronic parts that are not in production by the original manufacturer or an authorized aftermarket manufacturer, and that are not currently available in stock from a source listed in paragraph (b)(1) of this clause, from suppliers identified by the Contractor as contractor-approved suppliers, provided that—</P>
                                <P>
                                    (i) For identifying and approving such contractor-approved suppliers, the Contractor uses established counterfeit prevention industry standards and processes (including inspection, testing, and authentication), such as the DoD-adopted standards at 
                                    <E T="03">https://assist.dla.mil</E>
                                    ;
                                    <PRTPAGE P="743"/>
                                </P>
                                <P>(ii) The Contractor assumes responsibility for the authenticity of parts provided by such contractor-approved suppliers; and</P>
                                <P>(iii) The Contractor's selection of such contractor-approved suppliers is subject to review, audit, and approval by the Government, generally in conjunction with a contractor purchasing system review or other surveillance of purchasing practices by the contract administration office, or if the Government obtains credible evidence that a contractor-approved supplier has provided counterfeit parts. The Contractor may proceed with the acquisition of electronic parts from a contractor-approved supplier unless otherwise notified by DoD; or</P>
                                <P>(3)(i) Take the actions in paragraphs paragraph (b)(3)(ii) of this clause if the Contractor—</P>
                                <P>(A) Obtains an electronic part from—</P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) A source other than any of the sources identified in paragraph (b)(1) or (b)(2) of this clause, due to nonavailability from such sources; or
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) A subcontractor (other than the original manufacturer) that refuses to accept flowdown of this clause; or
                                </P>
                                <P>(B) Cannot confirm that an electronic part is new or previously unused and that it has not been comingled in supplier new production or stock with used, refurbished, reclaimed, or returned parts.</P>
                                <P>(ii) If the contractor obtains an electronic part or cannot confirm an electronic part pursuant to paragraph (b)(3)(i) of this clause—</P>
                                <P>
                                    (A) Promptly notify the Contracting Officer in writing. If such notification is required for an electronic part to be used in a designated lot of assemblies to be acquired under a single contract, the Contractor may submit one notification for the lot, providing identification of the assemblies containing the parts (
                                    <E T="03">e.g.</E>
                                    , serial numbers);
                                </P>
                                <P>(B) Be responsible for inspection, testing, and authentication, in accordance with existing applicable industry standards; and</P>
                                <P>(C) Make documentation of inspection, testing, and authentication of such electronic parts available to the Government upon request.</P>
                                <P>
                                    (c) 
                                    <E T="03">Traceability.</E>
                                     If the Contractor is not the original manufacturer of, or authorized supplier for, an electronic part, the Contractor shall—
                                </P>
                                <P>(1) Have risk-based processes (taking into consideration the consequences of failure of an electronic part) that enable tracking of electronic parts from the original manufacturer to product acceptance by the Government, whether the electronic part is supplied as a discrete electronic part or is contained in an assembly;</P>
                                <P>(2) If the Contractor cannot establish this traceability from the original manufacturer for a specific electronic part, be responsible for inspection, testing, and authentication, in accordance with existing applicable industry standards; and</P>
                                <P>(3)(i) Maintain documentation of traceability (paragraph (c)(1) of this clause) or the inspection, testing, and authentication required when traceability cannot be established (paragraph (c)(2) of this clause) in accordance with FAR subpart 4.7; and</P>
                                <P>(ii) Make such documentation available to the Government upon request.</P>
                                <P>
                                    (d) 
                                    <E T="03">Government sources.</E>
                                     Contractors and subcontractors are still required to comply with the requirements of paragraphs (b) and (c) of this clause, as applicable, if—
                                </P>
                                <P>(1) Authorized to purchase electronic parts from the Federal Supply Schedule;</P>
                                <P>(2) Purchasing electronic parts from suppliers accredited by the Defense Microelectronics Activity; or</P>
                                <P>(3) Requisitioning electronic parts from Government inventory/stock under the authority of 252.251-7000, Ordering from Government Supply Sources.</P>
                                <P>(i) The cost of any required inspection, testing, and authentication of such parts may be charged as a direct cost.</P>
                                <P>(ii) The Government is responsible for the authenticity of the requisitioned parts. If any such part is subsequently found to be counterfeit or suspect counterfeit, the Government will—</P>
                                <P>(A) Promptly replace such part at no charge; and</P>
                                <P>(B) Consider an adjustment in the contract schedule to the extent that replacement of the counterfeit or suspect counterfeit electronic parts caused a delay in performance.</P>
                                <P>
                                    (e) 
                                    <E T="03">Subcontracts.</E>
                                     The Contractor shall include the substance of this clause, including this paragraph (e), in subcontracts, including subcontracts for commercial products, that are for electronic parts or assemblies containing electronic parts, unless the subcontractor is the original manufacturer.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[81 FR 50649, Aug. 2, 2016, as amended at 81 FR 72738, Oct. 21, 2016; 82 FR 61481, Dec. 28, 2017; 83 FR 19645, May 4, 2018; 88 FR 6596, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.247-7000</SECTNO>
                            <SUBJECT>Hardship conditions.</SUBJECT>
                            <P>As prescribed in 247.270-4(a), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Hardship Conditions (AUG 2000)</HD>
                                <P>(a) If the Contractor finds unusual ship, dock, or cargo conditions associated with loading or unloading a particular cargo, that will work a hardship on the Contractor if loaded or unloaded at the basic commodity rates, the Contractor shall—</P>
                                <P>
                                    (1) Notify the Contracting Officer before performing the work, if feasible, but no later than the vessel sailing time; and
                                    <PRTPAGE P="744"/>
                                </P>
                                <P>(2) Submit any associated request for price adjustment to the Contracting Officer within 10 working days of the vessel sailing time.</P>
                                <P>(b) Unusual conditions include, but are not limited to, inaccessibility of place of stowage to the ship's cargo gear, side port operations, and small quantities of cargo in any one hatch.</P>
                                <P>(c) The Contracting Officer will investigate the conditions promptly after receiving the notice. If the Contracting Officer finds that the conditions are unusual and do materially affect the cost of loading or unloading, the Contracting Officer will authorize payment at the applicable man-hour rates set forth in the schedule of rates of this contract.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[65 FR 50147, Aug. 17, 2000, as amended at 75 FR 51418, Aug. 20, 2010]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.247-7001</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.247-7002</SECTNO>
                            <SUBJECT>Revision of prices.</SUBJECT>
                            <P>As prescribed in 247.270-4(b), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Revision of Prices (DEC 1991)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition. Wage adjustment,</E>
                                     as used in this clause, means a change in the wages, salaries, or other terms or conditions of employment which—
                                </P>
                                <P>(1) Substantially affects the cost of performing this contract;</P>
                                <P>(2) Is generally applicable to the port where work under this contract is performed; and</P>
                                <P>(3) Applies to operations by the Contractor on non-Government work as well as to work under this contract.</P>
                                <P>
                                    (b) 
                                    <E T="03">General.</E>
                                     The prices fixed in this contract are based on wages and working conditions established by collective bargaining agreements, and on other conditions in effect on the date of this contract. The Contracting Officer and the Contractor may agree to increase or decrease such prices in accordance with this clause.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Demand for negotiation.</E>
                                     (1) At any time, subject to the limitations specified in this clause, either the Contracting Officer or the Contractor may deliver to the other a written demand that the parties negotiate to revise the prices under this contract.
                                </P>
                                <P>(2) No such demand shall be made before 90 days after the date of this contract, and thereafter neither party shall make a demand having an effective date within 90 days of the effective date of any prior demand. However, this limitation does not apply to a wage adjustment during the 90 day period.</P>
                                <P>(3) Each demand shall specify a date (the same as or subsequent to the date of the delivery of the demand) as to when the revised prices shall be effective. This date is the effective date of the price revision.</P>
                                <P>(i) If the Contractor makes a demand under this clause, the demand shall briefly state the basis of the demand and include the statements and data referred to in paragraph (d) of this clause.</P>
                                <P>(ii) If the demand is made by the Contracting Officer, the Contractor shall furnish the statements and data within 30 days of the delivery of the demand.</P>
                                <P>
                                    (d) 
                                    <E T="03">Submission of data.</E>
                                     At the times specified in paragraphs (c)(3)(i) and (ii) of this clause, the Contractor shall submit—
                                </P>
                                <P>(1) A new estimate and breakdown of the unit cost and the proposed prices for the services the Contractor will perform under this contract after the effective date of the price revision, itemized to be consistent with the original negotiations of the contract;</P>
                                <P>(2) An explanation of the difference between the original (or last preceding) estimate and the new estimate;</P>
                                <P>(3) Such relevant operating data, cost records, overhead absorption reports, and accounting statements as may be of assistance in determining the accuracy and reliability of the new estimate;</P>
                                <P>(4) A statement of the actual costs of performance under this contract to the extent that they are available at the time of the negotiation of the revision of prices under this clause; and</P>
                                <P>(5) Any other relevant data usually furnished in the case of negotiations of prices under a new contract. The Government may examine and audit the Contractor's accounts, records, and books as the Contracting Officer considers necessary.</P>
                                <P>
                                    (e) 
                                    <E T="03">Negotiations.</E>
                                     (1) Upon the filing of the statements and data required by paragraph (d) of this clause, the Contractor and the Contracting Officer shall negotiate promptly in good faith to agree upon prices for services the Contractor will perform on and after the effective date of the price revision.
                                </P>
                                <P>(2) If the prices in this contract were established by competitive negotiation, they shall not be revised upward unless justified by changes in conditions occurring after the contract was awarded.</P>
                                <P>(3) The agreement reached after each negotiation will be incorporated into the contract by supplemental agreement.</P>
                                <P>
                                    (f) 
                                    <E T="03">Disagreements.</E>
                                     If, within 30 days after the date on which statements and data are required pursuant to paragraph (c) of this clause, the Contracting Officer and the Contractor fail to agree to revised prices, the failure to agree shall be resolved in accordance with the Disputes clause of this contract. The prices fixed by the Contracting Officer will remain in effect for the balance of the contract, and the Contractor shall continue performance.
                                </P>
                                <P>
                                    (g) 
                                    <E T="03">Retroactive changes in wages or working conditions.</E>
                                     (1) In the event of a retroactive 
                                    <PRTPAGE P="745"/>
                                    wage adjustment, the Contractor or the Contracting Officer may request an equitable adjustment in the prices in this contract.
                                </P>
                                <P>(2) The Contractor shall request a price adjustment within 30 days of any retroactive wage adjustment. The Contractor shall support its request with—</P>
                                <P>(i) An estimate of the changes in cost resulting from the retroactive wage adjustment;</P>
                                <P>(ii) Complete information upon which the estimate is based; and</P>
                                <P>(iii) A certified copy of the collective bargaining agreement, arbitration award, or other document evidencing the retroactive wage adjustment.</P>
                                <P>(3) Subject to the limitation in paragraph (g)(2) of this clause as to the time of making a request, completion or termination of this contract shall not affect the Contractor's right under paragraph (g) of this clause.</P>
                                <P>(4) In case of disagreement concerning any question of fact, including whether any adjustment should be made, or the amount of such adjustment, the disagreement will be resolved in accordance with the Disputes clause of this contract.</P>
                                <P>(5) The Contractor shall notify the Contracting Officer in writing of any request by or on behalf of the employees of the Contractor which may result in a retroactive wage adjustment. The notice shall be given within 20 days after the request, or if the request occurs before contract execution, at the time of execution.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 65 FR 50147, Aug. 17, 2000; 75 FR 51418, Aug. 20, 2010; 84 FR 30953, June 28, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.247-7003</SECTNO>
                            <SUBJECT>Pass-Through of Motor Carrier Fuel Surcharge Adjustment To The Cost Bearer.</SUBJECT>
                            <P>As prescribed in 247.207, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Pass-Through of Motor Carrier Fuel Surcharge Adjustment to the Cost Bearer (JAN 2023)</HD>
                                <P>(a) This clause implements section 884 of the National Defense Authorization Act for Fiscal Year 2009 (Pub. L. 110-417).</P>
                                <P>(b) Unless an exception is authorized by the Contracting Officer, the Contractor shall pass through any motor carrier fuel-related surcharge adjustments to the person, corporation, or entity that directly bears the cost of fuel for shipment(s) transported under this contract.</P>
                                <P>
                                    (c) 
                                    <E T="03">Subcontracts.</E>
                                     The Contractor shall insert the substance of this clause, including this paragraph (c), in all subcontracts, including subcontracts for commercial products or commercial services, with motor carriers, brokers, or freight forwarders.
                                </P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[75 FR 59105, Sept. 27, 2010, as amended at 78 FR 37991, June 25, 2013; 88 FR 6596, Jan. 31, 2023]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.247-7004—252.247-7006</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.247-7007</SECTNO>
                            <SUBJECT>Liability and insurance.</SUBJECT>
                            <P>As prescribed in 247.270-4(c), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Liability and Insurance (DEC 1991)</HD>
                                <P>(a) The Contractor shall be—</P>
                                <P>(1) Liable to the Government for loss or damage to property, real and personal, owned by the Government or for which the Government is liable;</P>
                                <P>(2) Responsible for, and hold the Government harmless from, loss of or damage to property not included in paragraph (a)(1); and</P>
                                <P>(3) Responsible for, and hold the Government harmless from, bodily injury and death of persons, resulting either in whole or in part from the negligence or fault of the Contractor, its officers, agents, or employees in the performance of work under this contract.</P>
                                <P>(b) For the purpose of this clause, all cargo loaded or unloaded under this contract is agreed to be property owned by the Government or property for which the Government is liable.</P>
                                <P>(1) The amount of the loss or damage as determined by the Contracting Officer will be withheld from payments otherwise due the Contractor.</P>
                                <P>(2) Determination of liability and responsibility by the Contracting Officer will constitute questions of fact within the meaning of the Disputes clause of this contract.</P>
                                <P>(c) The general liability and responsibility of the Contractor under this clause are subject only to the following specific limitations. The Contractor is not responsible to the Government for, and does not agree to hold the Government harmless from, loss or damage to property or bodily injury to or death of persons if—</P>
                                <P>(1) The unseaworthiness of the vessel, or failure or defect of the gear or equipment furnished by the Government, contributed jointly with the fault or negligence of the Contractor in causing such damage, injury, or death; and</P>
                                <P>(i) The Contractor, his officers, agents, and employees, by the exercise of due diligence, could not have discovered such unseaworthiness or defect of gear or equipment; or</P>
                                <P>
                                    (ii) Through the exercise of due diligence could not otherwise have avoided such damage, injury, or death.
                                    <PRTPAGE P="746"/>
                                </P>
                                <P>(2) The damage, injury, or death resulted solely from an act or omission of the Government or its employees, or resulted solely from proper compliance by officers, agents, or employees of the Contractor with specific directions of the Contracting Officer.</P>
                                <P>(d) The Contractor shall at its own expense acquire and maintain insurance during the term of this contract, as follows—</P>
                                <P>(1) Standard workmen's compensation and employer's liability insurance and longshoremen's and harbor workers' compensation insurance, or such of these as may be proper under applicable state or Federal statutes.</P>
                                <P>(i) The Contractor may, with the prior approval of the Contracting Officer, be a self-insurer against the risk of this paragraph (d)(1).</P>
                                <P>(ii) This approval will be given upon receipt of satisfactory evidence that the Contractor has qualified as a self-insurer under applicable provision of law.</P>
                                <P>(2) Bodily injury liability insurance in an amount of not less than $300,000 on account of any one occurrence.</P>
                                <P>(3) Property damage liability insurance (which shall include any and all property, whether or not in the care, custody, or control of the Contractor) in an amount of not less than $300,000 for any one occurrence.</P>
                                <P>(e) Each policy shall provide, by appropriate endorsement or otherwise, that cancellation or material change in the policy shall not be effective until after a 30 day written notice is furnished the Contracting Officer.</P>
                                <P>(f) The Contractor shall furnish the Contracting Officer with satisfactory evidence of the insurance required in paragraph (d) before performance of any work under this contract.</P>
                                <P>(g) The Contractor shall, at its own cost and expense, defend any suits, demands, claims, or actions, in which the United States might be named as a co-defendant of the Contractor, resulting from the Contractor's performance of work under this contract. This requirement is without regard to whether such suit, demand, claim, or action was the result of the Contractor's negligence. The Government shall have the right to appear in such suit, participate in defense, and take such actions as may be necessary to protect the interest of the United States.</P>
                                <P>(h) It is expressly agreed that the provisions in paragraphs (d) through (g) of this clause shall not in any manner limit the liability or extend the liability of the Contractor as provided in paragraphs (a) through (c) of this clause.</P>
                                <P>(i) The Contractor shall—</P>
                                <P>(1) Equitably reimburse the Government if the Contractor is indemnified, reimbursed, or relieved of any loss or damage to Government property;</P>
                                <P>(2) Do nothing to prevent the Government's right to recover against third parties for any such loss or damage; and</P>
                                <P>(3) Furnish the Government, upon the request of the Contracting Officer, at the Government's expense, all reasonable assistance and cooperation in obtaining recovery, including the prosecution of suit and the execution of instruments of assignment in favor of the Government.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 65 FR 50148, Aug. 17, 2000; 75 FR 51418, Aug. 20, 2010; 83 FR 42789, Aug. 24, 2018; 83 FR 49180, 49182, Sept. 28, 2018; 84 FR 30953, June 28, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.247-7008—252.247-7013</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.247-7014</SECTNO>
                            <SUBJECT>Demurrage.</SUBJECT>
                            <P>As prescribed in 247.271-3(c), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Demurrage (DEC 1991)</HD>
                                <P>The Contractor shall be liable for all demurrage, detention, or other charges as a result of its failure to load or unload trucks, freight cars, freight terminals, vessel piers, or warehouses within the free time allowed under applicable rules and tariffs.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 75 FR 51419, Aug. 20, 2010; 84 FR 25195, May 31, 2019; 84 FR 30952, June 28, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.247-7015</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.247-7016</SECTNO>
                            <SUBJECT>Contractor liability for loss or damage.</SUBJECT>
                            <P>As prescribed in 247.271-3(d), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Contractor Liability for Loss or Damage (DEC 1991)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Article</E>
                                     means any shipping piece or package and its contents.
                                </P>
                                <P>
                                    <E T="03">Schedule</E>
                                     means the level of service for which specific types of traffic apply as described in DoD 4500.34-R, Personal Property Traffic Management Regulation.
                                </P>
                                <P>(b) For shipments picked up under Schedule I, Outbound Services, or delivered under Schedule II, Inbound Services—</P>
                                <P>
                                    (1) If notified within one year after delivery that the owner has discovered loss or damage to the owner's property, the Contractor agrees to indemnify the Government for loss or damage to the property which arises from any cause while it is in the Contractor's possession. The Contractor's liability is—
                                    <PRTPAGE P="747"/>
                                </P>
                                <P>
                                    (i) 
                                    <E T="03">Non-negligent damage.</E>
                                     For any cause, other than the Contractor's negligence, indemnification shall be at a rate not to exceed sixty cents per pound per article.
                                </P>
                                <P>
                                    (ii) 
                                    <E T="03">Negligent damage.</E>
                                     When loss or damage is caused by the negligence of the Contractor, the liability is for the full cost of satisfactory repair or for the current replacement value of the article.
                                </P>
                                <P>(2) The Contractor shall make prompt payment to the owner of the property for any loss or damage for which the Contractor is liable.</P>
                                <P>(3) In the absence of evidence or supporting documentation which places liability on a carrier or another contractor, the destination contractor shall be presumed to be liable for the loss or damage, if timely notified.</P>
                                <P>(c) For shipments picked up or delivered under Schedule III, Intra-City and Intra-Area—</P>
                                <P>(1) If notified of loss or damage within 75 days following delivery, the Contractor agrees to indemnify the Government for loss or damage to the owner's property.</P>
                                <P>(2) The Contractor's liability shall be for the full cost of satisfactory repair, or for the current replacement value of the article less depreciation, up to a maximum liability of $1.25 per pound times the net weight of the shipment.</P>
                                <P>(3) The Contractor has full salvage rights to damaged items which are not repairable and for which the Government has received compensation at replacement value.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 75 FR 51419, Aug. 20, 2010; 84 FR 25195, May 31, 2019; 84 FR 30952, June 28, 2019]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.247-7017—252.247-7021</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.247-7022</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.247-7023</SECTNO>
                            <SUBJECT>Transportation of Supplies by Sea.</SUBJECT>
                            <P>As prescribed in 247.574(a) and (a)(1), use the following basic clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Transportation of Supplies by Sea—Basic (OCT 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Foreign-flag vessel</E>
                                     means any vessel that is not a U.S.-flag vessel.
                                </P>
                                <P>
                                    <E T="03">Ocean transportation</E>
                                     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.
                                </P>
                                <P>
                                    <E T="03">Subcontractor</E>
                                     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.
                                </P>
                                <P>
                                    <E T="03">Supplies</E>
                                     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.
                                </P>
                                <P>
                                    <E T="03">U.S.-flag vessel</E>
                                     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.
                                </P>
                                <P>(b) If the transportation of supplies by sea is anticipated under this contract, the Contractor shall—</P>
                                <P>
                                    (1) Notify the Contracting Officer and Maritime Administration (MARAD) at 
                                    <E T="03">Cargo.Marad@dot.gov</E>
                                    —
                                </P>
                                <P>(i) Within 3 business days after contract award; or</P>
                                <P>(ii) Immediately prior to the shipment departure date necessary to meet delivery schedules, whichever is earlier; and</P>
                                <P>(2) Include in the notification—</P>
                                <P>(i) A statement of the Contractor's intent to transport supplies by sea;</P>
                                <P>(ii) The contract number; and</P>
                                <P>(iii) The task-order or delivery-order number, when applicable.</P>
                                <P>(c)(1) The Contractor shall use U.S.-flag vessels when transporting any supplies by sea under this contract.</P>
                                <P>(2) A subcontractor transporting supplies by sea under this contract shall use U.S.-flag vessels if—</P>
                                <P>(i) This contract is a construction contract; or</P>
                                <P>(ii) The supplies being transported are—</P>
                                <P>(A) Other than commercial products or</P>
                                <P>(B) Commercial products that—</P>
                                <P>
                                    (
                                    <E T="03">1</E>
                                    ) The Contractor is reselling or distributing to the Government without adding value (generally, the Contractor does not add value to items that it contracts for f.o.b. destination shipment);
                                </P>
                                <P>
                                    (
                                    <E T="03">2</E>
                                    ) Are shipped in direct support of U.S. military contingency operations, exercises, or forces deployed in humanitarian or peacekeeping operations; or
                                </P>
                                <P>
                                    (
                                    <E T="03">3</E>
                                    ) Are commissary or exchange cargoes transported outside of the Defense Transportation System in accordance with 10 U.S.C. 2643.
                                </P>
                                <P>(d) 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—</P>
                                <P>
                                    (1) U.S.-flag vessels are not available at a fair and reasonable rate for commercial vessels of the United States; or
                                    <PRTPAGE P="748"/>
                                </P>
                                <P>(2) U.S.-flag vessels are otherwise not available.</P>
                                <P>(e) The Contractor must submit any request for use of foreign-flag vessels in writing to the Contracting Officer at least 45 days prior to the sailing date necessary to meet its delivery schedules. 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. Requests shall contain at a minimum—</P>
                                <P>(1) Type, weight, and cube of cargo;</P>
                                <P>(2) Required shipping date(s) and required delivery date(s);</P>
                                <P>(3) Special handling and discharge requirements;</P>
                                <P>(4) Loading and discharge points;</P>
                                <P>(5) Name of shipper and consignee;</P>
                                <P>(6) Prime contract number; and</P>
                                <P>(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.</P>
                                <P>
                                    (f) The Contractor shall, within 30 days after each shipment covered by this clause, provide the Contracting Officer and MARAD at 
                                    <E T="03">Cargo.Marad@dot.gov</E>
                                    , Attention: Military Team, one copy of the rated on board vessel operating carrier's ocean bill of lading, which shall contain the following information:
                                </P>
                                <P>(1) Prime contract number;</P>
                                <P>(2) Name of vessel;</P>
                                <P>(3) Vessel flag of registry;</P>
                                <P>(4) Date of loading;</P>
                                <P>(5) Port of loading;</P>
                                <P>(6) Port of final discharge;</P>
                                <P>(7) Description of commodity;</P>
                                <P>(8) Gross weight in pounds and cubic feet if available;</P>
                                <P>(9) Total ocean freight in U.S. dollars; and</P>
                                <P>(10) Name of the carrier.</P>
                                <P>(g) If this contract exceeds the simplified acquisition threshold, the Contractor shall provide with its final invoice under this contract a representation that to the best of its knowledge and belief—</P>
                                <P>(1) No ocean transportation was used in the performance of this contract;</P>
                                <P>(2) Ocean transportation was used and only U.S.-flag vessels were used for all ocean shipments under the contract;</P>
                                <P>(3) Ocean transportation was used, and the Contractor had received a prior-approved waiver for U.S.-flag vessels for all foreign-flag ocean transportation; or</P>
                                <P>(4) Ocean transportation was used and some or all of the shipments were made on foreign-flag vessels without the written consent of DoD. The Contractor shall describe these shipments in the following format:</P>
                                <GPOTABLE COLS="4" OPTS="L2" CDEF="s10,r10,r10,r10">
                                    <BOXHD>
                                        <CHED H="1"> </CHED>
                                        <CHED H="1">Item Description</CHED>
                                        <CHED H="1">Contract Line Items</CHED>
                                        <CHED H="1">Quantity</CHED>
                                    </BOXHD>
                                    <ROW>
                                        <ENT I="01">Total</ENT>
                                    </ROW>
                                </GPOTABLE>
                                <P>(h) If this contract exceeds the simplified acquisition threshold and the final invoice does not include the required representation, the Government will reject and return it to the Contractor as an improper invoice for the purposes of the Prompt Payment clause of this contract. In the event there has been unauthorized use of foreign-flag vessels in the performance of this contract, the Contracting Officer is entitled to equitably adjust the contract, based on the unauthorized use.</P>
                                <P>(i) If the Contractor did not anticipate transporting any supplies by sea at the time of contract award and, therefore, did not provide the notification required by paragraph (b) of this clause, but prior to shipment of supplies, the Contractor learns that supplies will be transported by sea, the Contractor shall—</P>
                                <P>(1) Provide the notification required by paragraph (b) of this clause to the Contracting Officer and MARAD as soon as it is known that supplies will be transported by sea; and</P>
                                <P>(2) Comply with all the terms and conditions of this clause.</P>
                                <P>
                                    (j) 
                                    <E T="03">Subcontracts.</E>
                                      In the award of subcontracts for the types of supplies described in paragraph (c)(2) of this clause, including subcontracts for commercial products, the Contractor shall flow down the requirements of this clause as follows:
                                </P>
                                <P>(1) The Contractor shall insert the substance of this clause, including this paragraph (j), in subcontracts that exceed the simplified acquisition threshold in part 2 of the Federal Acquisition Regulation.</P>
                                <P>(2) The Contractor shall insert the substance of paragraphs (a) through (f) of this clause, and this paragraph (j), in subcontracts that are at or below the simplified acquisition threshold in part 2 of the Federal Acquisition Regulation.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate I.</E>
                                 As prescribed in 247.574(a) and (a)(2), use the following clause, which uses a different paragraph (c) than the basic clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Transportation of Supplies by Sea—Alternate I (OCT 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Foreign-flag vessel</E>
                                     means any vessel that is not a U.S.-flag vessel.
                                    <PRTPAGE P="749"/>
                                </P>
                                <P>
                                    <E T="03">Ocean transportation</E>
                                     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.
                                </P>
                                <P>
                                    <E T="03">Subcontractor</E>
                                     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.
                                </P>
                                <P>
                                    <E T="03">Supplies</E>
                                     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.
                                </P>
                                <P>
                                    <E T="03">U.S.-flag vessel</E>
                                     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.
                                </P>
                                <P>(b) If the transportation of supplies by sea is anticipated under this contract, the Contractor shall—</P>
                                <P>
                                    (1) Notify the Contracting Officer and Maritime Administration (MARAD) at 
                                    <E T="03">Cargo.Marad@dot.gov</E>
                                    —
                                </P>
                                <P>(i) Within 3 business days after contract award; or</P>
                                <P>(ii) Immediately prior to the shipment departure date necessary to meet delivery schedules, whichever is earlier; and</P>
                                <P>(2) Include in the notification—</P>
                                <P>(i) A statement of the Contractor's intent to transport supplies by sea;</P>
                                <P>(ii) The contract number; and</P>
                                <P>(iii) The task-order or delivery-order number, when applicable.</P>
                                <P>(c)(1) The Contractor shall use U.S.-flag vessels when transporting any supplies by sea under this contract.</P>
                                <P>(2) A subcontractor transporting supplies by sea under this contract shall use U.S.-flag vessels if the supplies being transported are—</P>
                                <P>(i) Other than commercial products; or</P>
                                <P>(ii) Commercial products that—</P>
                                <P>(A) The Contractor is reselling or distributing to the Government without adding value (generally, the Contractor does not add value to items that it subcontracts for f.o.b. destination shipment);</P>
                                <P>(B) Are shipped in direct support of U.S. military contingency operations, exercises, or forces deployed in humanitarian or peacekeeping operations (Note: This contract requires shipment of commercial products  in direct support of U.S. military contingency operations, exercises, or forces deployed in humanitarian or peacekeeping operations); or</P>
                                <P>(C) Are commissary or exchange cargoes transported outside of the Defense Transportation System in accordance with 10 U.S.C. 2643.</P>
                                <P>(d) 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—</P>
                                <P>(1) U.S.-flag vessels are not available at a fair and reasonable rate for commercial vessels of the United States; or</P>
                                <P>(2) U.S.-flag vessels are otherwise not available.</P>
                                <P>(e) The Contractor must submit any request for use of foreign-flag vessels in writing to the Contracting Officer at least 45 days prior to the sailing date necessary to meet its delivery schedules. 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. Requests shall contain at a minimum—</P>
                                <P>(1) Type, weight, and cube of cargo;</P>
                                <P>(2) Required shipping date(s) and required delivery date(s);</P>
                                <P>(3) Special handling and discharge requirements;</P>
                                <P>(4) Loading and discharge points;</P>
                                <P>(5) Name of shipper and consignee;</P>
                                <P>(6) Prime contract number; and</P>
                                <P>(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.</P>
                                <P>
                                    (f) The Contractor shall, within 30 days after each shipment covered by this clause, provide the Contracting Officer and MARAD at 
                                    <E T="03">Cargo.Marad@dot.gov</E>
                                    , Attention: Military Team, one copy of the rated on board vessel operating carrier's ocean bill of lading, which shall contain the following information:
                                </P>
                                <P>(1) Prime contract number;</P>
                                <P>(2) Name of vessel;</P>
                                <P>(3) Vessel flag of registry;</P>
                                <P>(4) Date of loading;</P>
                                <P>(5) Port of loading;</P>
                                <P>(6) Port of final discharge;</P>
                                <P>(7) Description of commodity;</P>
                                <P>(8) Gross weight in pounds and cubic feet if available;</P>
                                <P>(9) Total ocean freight in U.S. dollars; and</P>
                                <P>(10) Name of the carrier.</P>
                                <P>
                                    (g) If this contract exceeds the simplified acquisition threshold, the Contractor shall 
                                    <PRTPAGE P="750"/>
                                    provide with its final invoice under this contract a representation that to the best of its knowledge and belief—
                                </P>
                                <P>(1) No ocean transportation was used in the performance of this contract;</P>
                                <P>(2) Ocean transportation was used and only U.S.-flag vessels were used for all ocean shipments under the contract;</P>
                                <P>(3) Ocean transportation was used, and the Contractor had had received a prior-approved waiver for U.S.-flag vessels for all foreign-flag ocean transportation; or</P>
                                <P>(4) Ocean transportation was used and some or all of the shipments were made on foreign-flag vessels without the written consent of the DoD. The Contractor shall describe these shipments in the following format:</P>
                                <GPOTABLE COLS="4" OPTS="L2" CDEF="s40,r60,r60,r60">
                                    <BOXHD>
                                        <CHED H="1"> </CHED>
                                        <CHED H="1">Item description</CHED>
                                        <CHED H="1">Contract line items</CHED>
                                        <CHED H="1">Quantity</CHED>
                                    </BOXHD>
                                    <ROW>
                                        <ENT I="01" O="xl"/>
                                        <ENT O="xl"/>
                                        <ENT O="xl"/>
                                        <ENT O="xl"/>
                                    </ROW>
                                    <ROW>
                                        <ENT I="03">TOTAL</ENT>
                                        <ENT O="xl"/>
                                        <ENT O="xl"/>
                                        <ENT O="xl"/>
                                    </ROW>
                                </GPOTABLE>
                                <P>(h) If this contract exceeds the simplified acquisition threshold and the final invoice does not include the required representation, the Government will reject and return it to the Contractor as an improper invoice for the purposes of the Prompt Payment clause of this contract. In the event there has been unauthorized use of foreign-flag vessels in the performance of this contract, the Contracting Officer is entitled to equitably adjust the contract, based on the unauthorized use.</P>
                                <P>(i) If the Contractor did not anticipate transporting any supplies by sea at the time of contract award and, therefore, did not provide the notification required by paragraph (b) of this clause, but prior to shipment of supplies, the Contractor learns that supplies will be transported by sea, the Contractor shall—</P>
                                <P>(1) Provide the notification required by paragraph (b) of this clause to the Contracting Officer and MARAD as soon as it is known that supplies will be transported by sea; and</P>
                                <P>(2) Comply with all the terms and conditions of this clause.</P>
                                <P>
                                    (j) 
                                    <E T="03">Subcontracts.</E>
                                     In the award of subcontracts for the types of supplies described in paragraph (c)(2) of this clause, including subcontracts for commercial products, the Contractor shall flow down the requirements of this clause as follows:
                                </P>
                                <P>(1) The Contractor shall insert the substance of this clause, including this paragraph (j), in subcontracts that exceed the simplified acquisition threshold in part 2 of the Federal Acquisition Regulation.</P>
                                <P>(2) The Contractor shall insert the substance of paragraphs (a) through (f) of this clause, and this paragraph (j), in subcontracts that are at or below the simplified acquisition threshold in part 2 of the Federal Acquisition Regulation.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <P>
                                <E T="03">Alternate II.</E>
                                 As prescribed in 247.574(a) and (a)(3), use the following clause, which uses a different paragraph (c) than the basic clause:
                            </P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Transportation of Supplies by Sea—Alternate II (OCT 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Foreign-flag vessel</E>
                                     means any vessel that is not a U.S.-flag vessel.
                                </P>
                                <P>
                                    <E T="03">Ocean transportation</E>
                                     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.
                                </P>
                                <P>
                                    <E T="03">Subcontractor</E>
                                     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.
                                </P>
                                <P>
                                    <E T="03">Supplies</E>
                                     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.
                                </P>
                                <P>
                                    <E T="03">U.S.-flag vessel</E>
                                     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.
                                </P>
                                <P>(b) If the transportation of supplies by sea is anticipated under this contract, the Contractor shall—</P>
                                <P>
                                    (1) Notify the Contracting Officer and Maritime Administration (MARAD) at 
                                    <E T="03">Cargo.Marad@dot.gov</E>
                                    —
                                </P>
                                <P>(i) Within 3 business days after contract award; or</P>
                                <P>(ii) Immediately prior to the shipment departure date necessary to meet delivery schedules, whichever is earlier; and</P>
                                <P>(2) Include in the notification—</P>
                                <P>(i) A statement of the Contractor's intent to transport supplies by sea;</P>
                                <P>
                                    (ii) The contract number; and
                                    <PRTPAGE P="751"/>
                                </P>
                                <P>(iii) The task-order or delivery-order number, when applicable.</P>
                                <P>(c)(1) The Contractor shall use U.S.-flag vessels when transporting any supplies by sea under this contract.</P>
                                <P>(2) A subcontractor transporting supplies by sea under this contract shall use U.S.-flag vessels if the supplies being transported are—</P>
                                <P>(i) Other than commercial products; or</P>
                                <P>(ii) Commercial products that—</P>
                                <P>(A) The Contractor is reselling or distributing to the Government without adding value (generally, the Contractor does not add value to items that it subcontracts for f.o.b. destination shipment);</P>
                                <P>(B) Are shipped in direct support of U.S. military contingency operations, exercises, or forces deployed in humanitarian or peacekeeping operations; or</P>
                                <P>(C) Are commissary or exchange cargoes transported outside of the Defense Transportation System in accordance with 10 U.S.C. 2643 (Note: This contract requires transportation of commissary or exchange cargoes outside of the Defense Transportation System in accordance with 10 U.S.C. 2643).</P>
                                <P>(d) 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—</P>
                                <P>(1) U.S.-flag vessels are not available at a fair and reasonable rate for commercial vessels of the United States; or</P>
                                <P>(2) U.S.-flag vessels are otherwise not available.</P>
                                <P>(e) The Contractor must submit any request for use of foreign-flag vessels in writing to the Contracting Officer at least 45 days prior to the sailing date necessary to meet its delivery schedules. 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.</P>
                                <P>(2) Required shipping date(s) and required delivery date(s);</P>
                                <P>(3) Special handling and discharge requirements;</P>
                                <P>(4) Loading and discharge points;</P>
                                <P>(5) Name of shipper and consignee;</P>
                                <P>(6) Prime contract number; and</P>
                                <P>(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.</P>
                                <P>
                                    (f) The Contractor shall, within 30 days after each shipment covered by this clause, provide the Contracting Officer and MARAD at 
                                    <E T="03">Cargo.Marad@dot.gov</E>
                                    , Attention: Military Team, one copy of the rated on board vessel operating carrier's ocean bill of lading, which shall contain the following information:
                                </P>
                                <P>(1) Prime contract number;</P>
                                <P>(2) Name of vessel;</P>
                                <P>(3) Vessel flag of registry;</P>
                                <P>(4) Date of loading;</P>
                                <P>(5) Port of loading;</P>
                                <P>(6) Port of final discharge;</P>
                                <P>(7) Description of commodity;</P>
                                <P>(8) Gross weight in pounds and cubic feet if available;</P>
                                <P>(9) Total ocean freight in U.S. dollars; and</P>
                                <P>(10) Name of steamship company.</P>
                                <P>(g) If this contract exceeds the simplified acquisition threshold, the Contractor shall provide with its final invoice under this contract a representation that to the best of its knowledge and belief—</P>
                                <P>(1) No ocean transportation was used in the performance of this contract;</P>
                                <P>(2) Ocean transportation was used and only U.S.-flag vessels were used for all ocean shipments under the contract;</P>
                                <P>(3) Ocean transportation was used, and the Contractor had the written consent of the Contracting Officer for all foreign-flag ocean transportation; or</P>
                                <P>(4) Ocean transportation was used and some or all of the shipments were made on foreign-flag vessels without the written consent of the Contracting Officer. The Contractor shall describe these shipments in the following format:</P>
                                <GPOTABLE COLS="4" OPTS="L2" CDEF="s40,r60,r60,r60">
                                    <BOXHD>
                                        <CHED H="1"> </CHED>
                                        <CHED H="1">Item description</CHED>
                                        <CHED H="1">Contract line items</CHED>
                                        <CHED H="1">Quantity</CHED>
                                    </BOXHD>
                                    <ROW>
                                        <ENT I="01" O="xl"/>
                                        <ENT O="xl"/>
                                        <ENT O="xl"/>
                                        <ENT O="xl"/>
                                    </ROW>
                                    <ROW>
                                        <ENT I="03">TOTAL</ENT>
                                        <ENT O="xl"/>
                                        <ENT O="xl"/>
                                        <ENT O="xl"/>
                                    </ROW>
                                </GPOTABLE>
                                <P>
                                    (h) If this contract exceeds the simplified acquisition threshold and the final invoice does not include the required representation, the Government will reject and return it to the Contractor as an improper invoice for the purposes of the Prompt Payment clause of this contract. In the event there has been unauthorized use of foreign-flag vessels in the performance of this contract, the Contracting Officer is entitled to equitably adjust the contract, based on the unauthorized use.
                                    <PRTPAGE P="752"/>
                                </P>
                                <P>(i) If the Contractor did not anticipate transporting any supplies by sea at the time of contract award, and, therefore, did not provide the notification required by paragraph (b) of this clause, but prior to shipment of the supplies, the Contractor learns after the award of the contract that supplies will be transported by sea, the Contractor shall—</P>
                                <P>(1) Provide the notification required by paragraph (b) of this clause to the Contracting Officer and MARAD as soon as it is known that supplies will be transported by sea; and</P>
                                <P>(2) Comply with all the terms and conditions of this clause.</P>
                                <P>
                                    (j) 
                                    <E T="03">Subcontracts.</E>
                                     In the award of subcontracts for the types of supplies described in paragraph (c)(2) of this clause, including subcontracts for commercial products, the Contractor shall flow down the requirements of this clause as follows:
                                </P>
                                <P>(1) The Contractor shall insert the substance of this clause, including this paragraph (j), in subcontracts that exceed the simplified acquisition threshold in part 2 of the Federal Acquisition Regulation.</P>
                                <P>(2) The Contractor shall insert the substance of paragraphs (a) through (f) of this clause, and this paragraph (j), in subcontracts that are at or below the simplified acquisition threshold in part 2 of the Federal Acquisition Regulation.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 60 FR 61602, Nov. 30, 1995; 65 FR 14401, Mar. 16, 2000; 67 FR 38022, May 31, 2002; 72 FR 49206, Aug. 28, 2007; 77 FR 76938, Dec. 31, 2012; 78 FR 37991, June 25, 2013; 79 FR 22039, Apr. 21, 2014; 80 FR 36900, June 26, 2015; 84 FR 4371, Feb. 15, 2019; 88 FR 6596, Jan. 31, 2023; 89 FR 78991, 78995, Sept. 26, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.247-7024</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.247-7025</SECTNO>
                            <SUBJECT>Reflagging or Repair Work.</SUBJECT>
                            <P>As prescribed in 247.574(b), use the following clause:</P>
                            <HD SOURCE="HD1">Reflagging or Repair Work (OCT 2024)</HD>
                            <EXTRACT>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Corrective and preventive maintenance or repair</E>
                                     means—
                                </P>
                                <P>(1) Maintenance or repair actions performed as a result of a failure in order to return or restore equipment to acceptable performance levels; and</P>
                                <P>(2) Scheduled maintenance or repair actions to prevent or discover functional failures.</P>
                                <P>
                                    <E T="03">Reflagging or repair work</E>
                                     means work performed on a vessel—
                                </P>
                                <P>(1) To enable the vessel to meet applicable standards to become a vessel of the United States; or</P>
                                <P>(2) To convert the vessel to a more useful military configuration.</P>
                                <P>
                                    (b) 
                                    <E T="03">Requirement.</E>
                                     Unless DoD waives this requirement, the Contractor shall ensure performance of the following in the United States or its outlying areas:
                                </P>
                                <P>(1) Reflagging or repair work, if the reflagging or repair work is performed—</P>
                                <P>(i) On a vessel for which the Contractor submitted an offer in response to the solicitation for this contract; and</P>
                                <P>(ii) Prior to acceptance of the vessel by the Government.</P>
                                <P>(2) Corrective and preventive maintenance or repair work for the duration of the contract, to the greatest extent practicable.</P>
                            </EXTRACT>
                            <FP>(End of clause)</FP>
                            <CITA>[89 FR 78996, Sept. 26, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.247-7026</SECTNO>
                            <SUBJECT>Evaluation Preference for Use of Domestic Shipyards—Applicable to Acquisition of Carriage by Vessel for DoD Cargo in the Coastwise or Noncontiguous Trade.</SUBJECT>
                            <P>As prescribed in 247.574(c), use the following provision:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Evaluation Preference for Use of Domestic Shipyards—Applicable To Acquisition of Carriage by Vessel for DOD Cargo in the Coastwise or Noncontiguous Trade (OCT 2024)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definitions.</E>
                                     As used in this provision—
                                </P>
                                <P>
                                    <E T="03">Covered vessel</E>
                                     means a vessel—
                                </P>
                                <P>(1) Owned, operated, or controlled by the offeror; and</P>
                                <P>(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.</P>
                                <P>
                                    <E T="03">Foreign shipyard</E>
                                     means a shipyard that is not a U.S. shipyard.
                                </P>
                                <P>
                                    <E T="03">Overhaul, repair, and maintenance work</E>
                                     means work requiring a shipyard period greater than or equal to 5 calendar days.
                                </P>
                                <P>
                                    <E T="03">U.S. shipyard</E>
                                     means a shipyard that is located in any State of the United States or in Guam.
                                </P>
                                <P>(b) This solicitation includes an evaluation criterion that considers the extent to which the Offeror has had overhaul, repair, and maintenance work for covered vessels performed in U.S. shipyards.</P>
                                <P>
                                    (c) The Offeror shall provide the following information with its offer, addressing all covered vessels for which overhaul, repair, and maintenance work has been performed 
                                    <PRTPAGE P="753"/>
                                    during the period covering the current calendar year, up to the date of proposal submission, and the preceding four calendar years:
                                </P>
                                <P>(1) Name of vessel.</P>
                                <P>(2) Description and cost of qualifying shipyard work performed in U.S. shipyards.</P>
                                <P>(3) Description and cost of qualifying shipyard work performed in foreign shipyards and whether—</P>
                                <P>(i) Such work was performed as emergency repairs in foreign shipyards due to accident, emergency, Act of God, or an infirmity to the vessel, and safety considerations warranted taking the vessel to a foreign shipyard; or</P>
                                <P>(ii) Such work was paid for or reimbursed by the U.S. Government.</P>
                                <P>(4) Names of shipyards that performed the work.</P>
                                <P>(5) Inclusive dates of work performed.</P>
                                <P>(d) Offerors are responsible for submitting accurate information. The Contracting Officer—</P>
                                <P>(1) Will use the information to evaluate offers in accordance with the criteria specified in the solicitation; and</P>
                                <P>(2) Reserves the right to request supporting documentation if determined necessary in the proposal evaluation process.</P>
                                <P>(e) The Department of Defense will provide the information submitted in response to this provision to the congressional defense committees, as required by section 1017 of Public Law 109-364 (10 U.S.C. 2631 note).</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of provision)</HD>
                            <CITA>[72 FR 49206, Aug. 28, 2007, as amended at 73 FR 70912, Nov. 24, 2008; 84 FR 4371, Feb. 15, 2019; 89 FR 78992, 78996, Sept. 26, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.247-7027</SECTNO>
                            <SUBJECT>Riding Gang Member Requirements.</SUBJECT>
                            <P>As prescribed in 247.574(d), use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Riding Gang Member Requirements (MAY 2018)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition. Riding gang member,</E>
                                     as used in this clause, has the same definition as “riding gang member” in title 46 U.S.C. 2101.
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Requirements relating to riding gang members.</E>
                                     Notwithstanding 46 U.S.C. 8106, the Contractor shall ensure each riding gang member holds a valid U.S. Merchant Mariner's Document issued under 46 U.S.C. chapter 73, or a transportation security card issued under section 70105 of such title.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Exemption.</E>
                                     (1) An individual is exempt from the requirements of paragraph (b) of this clause and shall not be treated as a riding gang member for the purposes of section 8106 of title 46, if that individual is on a vessel for purposes other than engaging in the operation or maintenance of the vessel and is—
                                </P>
                                <P>(i) One of the personnel who accompanies, supervises, guards, or maintains unit equipment aboard a ship, commonly referred to as supercargo personnel;</P>
                                <P>(ii) One of the force protection personnel of the vessel;</P>
                                <P>(iii) A specialized repair technician; or</P>
                                <P>(iv) An individual who is otherwise required by the Secretary of Defense or designee to be aboard the vessel.</P>
                                <P>(2) Any individual who is exempt under paragraph (c)(1) of this clause must pass a DoD background check before going aboard the vessel.</P>
                                <P>(i) The Contractor shall—</P>
                                <P>(A) Render all necessary assistance to U.S. Armed Forces personnel with respect to the identification and screening of exempted individuals. This will require, at a minimum, the Contractor to submit the name and other biographical information necessary to the Government official specified in the contract for the purposes of conducting a background check; and</P>
                                <P>(B) Deny access or immediately remove any individual(s) from the vessel deemed unsuitable for any reason by the Government agency conducting the background checks. The Contractor agrees to replace any such individual promptly and require such replacements to fully comply with all screening requirements.</P>
                                <P>(ii) The head of the contracting activity may waive this requirement if the individual possesses a valid U.S. Merchant Mariner's Document issued under 46 U.S.C. chapter 73, or a transportation security card issued under section 70105 of such title.</P>
                                <P>(3) An individual exempted under paragraph (c)(1) of this clause is not treated as a riding gang member and shall not be counted as an individual in addition to the crew for the purposes of 46 U.S.C. 3304.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[75 FR 65439, Oct. 25, 2010, as amended at 76 FR 61281, Oct. 4, 2011; 83 FR 24892, May 30, 2018; 84 FR 4371, Feb. 15, 2019; 89 FR 78992, Sept. 26, 2024]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.247-7028</SECTNO>
                            <SUBJECT>Application for U.S. Government Shipping Documentation/Instructions.</SUBJECT>
                            <P>As prescribed in 247.207, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Application for U.S. Government Shipping Documentation/Instructions (JUN 2012)</HD>
                                <P>
                                    (a) Except as provided in paragraph (b) of this clause, the Contractor shall request bills of lading by submitting a DD Form 1659, Application for U.S. Government Shipping Documentation/Instructions, to the—
                                    <PRTPAGE P="754"/>
                                </P>
                                <P>(1) Transportation Officer, if named in the contract schedule; or</P>
                                <P>(2) Contract administration office.</P>
                                <P>(b) If an automated system is available for shipment requests, use service/agency systems (e.g., Navy's Global Freight Management-Electronic Transportation Acquisition (GFM-ETA) and Financial Air Clearance Transportation System (FACTS) Shipment Processing Module, Air Force's Cargo Movement Operations System, DCMA's Shipment Instruction Request (SIR) E-tool, and DLA's Distribution Standard System Vendor Shipment Module in lieu of DD Form 1659.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[77 FR 39141, June 29, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.249-7000</SECTNO>
                            <SUBJECT>Special termination costs.</SUBJECT>
                            <P>As prescribed in 249.501-70, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Special Termination Costs (DEC 1991)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition. Special termination costs,</E>
                                     as used in this clause, means only costs in the following categories as defined in part 31 of the Federal Acquisition Regulation (FAR)—
                                </P>
                                <P>(1) Severance pay, as provided in FAR 31.205-6(g);</P>
                                <P>(2) Reasonable costs continuing after termination, as provided in FAR 31.205-42(b);</P>
                                <P>(3) Settlement of expenses, as provided in FAR 31.205-42(g);</P>
                                <P>(4) Costs of return of field service personnel from sites, as provided in FAR 31.205-35 and FAR 31.205-46(c); and</P>
                                <P>(5) Costs in paragraphs (a) (1), (2), (3), and (4) of this clause to which subcontractors may be entitled in the event of termination.</P>
                                <P>(b) Notwithstanding the Limitation of Cost/Limitation of Funds clause of this contract, the Contractor shall not include in its estimate of costs incurred or to be incurred, any amount for special termination costs to which the Contractor may be entitled in the event this contract is terminated for the convenience of the Government.</P>
                                <P>(c) The Contractor agrees to perform this contract in such a manner that the Contractor's claim for special termination costs will not exceed $________. The Government shall have no obligation to pay the Contractor any amount for the special termination costs in excess of this amount.</P>
                                <P>(d) In the event of termination for the convenience of the Government, this clause shall not be construed as affecting the allowability of special termination costs in any manner other than limiting the maximum amount of the costs payable by the Government.</P>
                                <P>(e) This clause shall remain in full force and effect until this contract is fully funded.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.249-7001</SECTNO>
                            <RESERVED>[Reserved]</RESERVED>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.249-7002</SECTNO>
                            <SUBJECT>Notification of Anticipated Contract Termination or Reduction.</SUBJECT>
                            <P>As prescribed in 249.7004, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Notification of Anticipated Contract Termination or Reduction (DEC 2022)</HD>
                                <P>
                                    (a) 
                                    <E T="03">Definition.</E>
                                     As used in this clause—
                                </P>
                                <P>
                                    <E T="03">Major defense program</E>
                                     means a program that is carried out to produce or acquire a major system (as defined in 10 U.S.C. 3041(a)).
                                </P>
                                <P>
                                    (b) 
                                    <E T="03">Scope.</E>
                                     This clause implements section 1372 of the National Defense Authorization Act for Fiscal Year 1994 (Pub. L. 103-160) and section 824 of the National Defense Authorization Act for Fiscal Year 1997 (Pub. L. 104-201), which are intended to help establish benefit eligibility under the Workforce Innovation and Opportunity Act (29 U.S.C. chapter 32) for employees of DoD contractors and subcontractors adversely affected by contract terminations or substantial reductions under major defense programs.
                                </P>
                                <P>
                                    (c) 
                                    <E T="03">Notice to employees and state and local officials.</E>
                                     (1) Within 2 weeks after the Contracting Officer notifies the Contractor that contract funding will be terminated or substantially reduced, the Contractor shall provide notice of such anticipated termination or reduction to—
                                </P>
                                <P>(i) Each employee representative of the Contractor's employees whose work is directly related to the defense contract; or</P>
                                <P>(ii) If there is no such representative, each such employee;</P>
                                <P>(iii) The State or entity designated by the State to carry out rapid response activities described in the Workforce Innovation and Opportunity Act (29 U.S.C. 3174(a)(2)(A)(i)); and</P>
                                <P>(iv) The chief elected official of the unit of general local government within which the adverse effect may occur.</P>
                                <P>(2) The notice provided an employee under paragraph (c)(1) of this clause shall have the same effect as a notice of termination to the employee for the purposes of determining whether such employee is eligible for training, adjustment assistance, and employment services under the Workforce Innovation and Opportunity Act (29 U.S.C. Chapter 32).</P>
                                <P>
                                    (d) 
                                    <E T="03">Notice to subcontractors.</E>
                                     Not later than 60 days after the Contractor receives the Contracting Officer's notice of the anticipated termination or reduction, the Contractor shall—
                                </P>
                                <P>
                                    (1) Provide notice of the anticipated termination or reduction to each first-tier subcontractor with a subcontract that equals or exceeds the threshold specified in Defense Federal Acquisition Regulation Supplement 
                                    <PRTPAGE P="755"/>
                                    (DFARS) 249.7003(c)(1) at the time of the notice; and
                                </P>
                                <P>(2) Require that each such subcontractor—</P>
                                <P>(i) Provide notice to each of its subcontractors with a subcontract that equals or exceeds the threshold specified in DFARS 249.7003(c)(2)(i) at the time of the notice; and</P>
                                <P>(ii) Impose a similar notice and flowdown requirement to subcontractors with subcontracts that equal or exceed the threshold specified in DFARS 249.7003(c)(2)(ii) at the time of the notice.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[61 FR 64637, Dec. 6, 1996, as amended at 71 FR 75893, Dec. 19, 2006; 75 FR 45074, Aug. 2, 2010; 80 FR 36905, June 26, 2015; 84 FR 25188, May 31, 2019; 85 FR 34536, June 5, 2020; 87 FR 76998, Dec. 16, 2022]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.251-7000</SECTNO>
                            <SUBJECT>Ordering from Government supply sources.</SUBJECT>
                            <P>As prescribed in 251.107, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Ordering From Government Supply Sources (AUG 2012)</HD>
                                <P>(a) When placing orders under Federal Supply Schedules, Personal Property Rehabilitation Price Schedules, or Enterprise Software Agreements, the Contractor shall follow the terms of the applicable schedule or agreement and authorization. Include in each order:</P>
                                <P>(1) A copy of the authorization (unless a copy was previously furnished to the Federal Supply Schedule, Personal Property Rehabilitation Price Schedule, or Enterprise Software Agreement contractor).</P>
                                <P>(2) The following statement: Any price reductions negotiated as part of an Enterprise Software Agreement issued under a Federal Supply Schedule contract shall control. In the event of any other inconsistencies between an Enterprise Software Agreement, established as a Federal Supply Schedule blanket purchase agreement, and the Federal Supply Schedule contract, the latter shall govern.</P>
                                <P>(3) The completed address(es) to which the Contractor's mail, freight, and billing documents are to be directed.</P>
                                <P>(b) When placing orders under nonmandatory schedule contracts and requirements contracts, issued by the General Services Administration (GSA) Office of Information Resources Management, for automated data processing equipment, software and maintenance, communications equipment and supplies, and teleprocessing services, the Contractor shall follow the terms of the applicable contract and the procedures in paragraph (a) of this clause.</P>
                                <P>(c) When placing orders for Government stock on a reimbursable basis, the Contractor shall—</P>
                                <P>(1) Comply with the requirements of the Contracting Officer's authorization, using FEDSTRIP or MILSTRIP procedures, as appropriate;</P>
                                <P>(2) Use only the GSA Form 1948-A, Retail Services Shopping Plate, when ordering from GSA Self-Service Stores;</P>
                                <P>(3) Order only those items required in the performance of Government contracts; and</P>
                                <P>(4) Pay invoices from Government supply sources promptly. For purchases made from DoD supply sources, this means within 30 days of the date of a proper invoice. The Contractor shall annotate each invoice with the date of receipt. For purposes of computing interest for late Contractor payments, the Government's invoice is deemed to be a demand for payment in accordance with the Interest clause of this contract. The Contractor's failure to pay may also result in the DoD supply source refusing to honor the requisition (see DFARS 251.102(f)) or in the Contracting Officer terminating the Contractor's authorization to use DoD supply sources. In the event the Contracting Officer decides to terminate the authorization due to the Contractor's failure to pay in a timely manner, the Contracting Officer shall provide the Contractor with prompt written notice of the intent to terminate the authorization and the basis for such action. The Contractor shall have 10 days after receipt of the Government's notice in which to provide additional information as to why the authorization should not be terminated. The termination shall not provide the Contractor with an excusable delay for failure to perform or complete the contract in accordance with the terms of the contract, and the Contractor shall be solely responsible for any increased costs.</P>
                                <P>(d) When placing orders for Government stock on a non-reimbursable basis, the Contractor shall—</P>
                                <P>(1) Comply with the requirements of the Contracting Officer's authorization; and</P>
                                <P>(2) When using electronic transactions to submit requisitions on a non-reimbursable basis only, place orders by authorizing contract number using the Defense Logistics Management System (DLMS) Supplement to Federal Implementation Convention 511R, Requisition; and acknowledge receipts by authorizing contract number using the DLMS Supplement 527R, Receipt, Inquiry, Response and Material Receipt Acknowledgement.</P>
                                <P>
                                    (e) Only the Contractor may request authorization for subcontractor use of Government supply sources. The Contracting Officer will not grant authorizations for subcontractor use without approval of the Contractor.
                                    <PRTPAGE P="756"/>
                                </P>
                                <P>(f) Government invoices shall be submitted to the Contractor's billing address, and Contractor payments shall be sent to the Government remittance address specified below:</P>
                                <FP SOURCE="FP-1">Contractor's Billing Address (include point of contact and telephone number):</FP>
                                <FP SOURCE="FP-1">Government Remittance Address (include point of contact and telephone number):</FP>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                            <CITA>[56 FR 36479, July 31, 1991, as amended at 60 FR 29503, June 5, 1995; 67 FR 65512, Oct. 25, 2002; 69 FR 67858, Nov. 22, 2004; 77 FR 52258, Aug. 29, 2012]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>252.251-7001</SECTNO>
                            <SUBJECT>Use of Interagency Fleet Management System (IFMS) vehicles and related services.</SUBJECT>
                            <P>As prescribed in 251.205, use the following clause:</P>
                            <EXTRACT>
                                <HD SOURCE="HD1">Use of Interagency Fleet Management System (IFMS) Vehicles and Related Services (DEC 1991)</HD>
                                <P>(a) The Contractor, if authorized use of IFMS vehicles, shall submit requests for five or fewer vehicles and related services in writing to the appropriate General Services Administration (GSA) Regional Customer Service Bureau, Attention: Motor Equipment Activity. Submit requests for more than five vehicles to GSA headquarters: General Services Administration, FTM, Washington, DC 20406. Include the following in each request:</P>
                                <P>(1) Two copies of the agency authorization to obtain vehicles and related services from GSA.</P>
                                <P>(2) The number of vehicles and related services required and the period of use.</P>
                                <P>(3) A list of the Contractor's employees authorized to request vehicles and related services.</P>
                                <P>(4) A list of the makes, models, and serial numbers of Contractor-owned or leased equipment authorized to be serviced.</P>
                                <P>(5) Billing instructions and address.</P>
                                <P>(b) The Contractor should make requests for any unusual quantities of vehicles as far in advance as possible.</P>
                                <P>(c) The Contractor shall establish and enforce suitable penalties for employees who use or authorize the use of Government vehicles for other than performance of Government contracts.</P>
                                <P>(d) The Contractor shall assume, without the right of reimbursement from the Government, the cost or expense of any use of IFMS vehicles and services not related to the performance of the contract.</P>
                                <P>(e) Only the Contractor may request authorization for subcontractor use of IFMS vehicles. The Contracting Officer will not grant authorization for subcontractor use without approval of the Contractor.</P>
                            </EXTRACT>
                            <HD SOURCE="HD3">(End of clause)</HD>
                        </SECTION>
                    </SUBPART>
                </PART>
                <PART>
                    <EAR>Pt. 253</EAR>
                    <HD SOURCE="HED">PART 253—FORMS</HD>
                    <CONTENTS>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 253.2—Prescription of Forms</HD>
                            <SECHD>Sec.</SECHD>
                            <SECTNO>253.208</SECTNO>
                            <SUBJECT>Required sources of supplies and services.</SUBJECT>
                            <SECTNO>253.208-1</SECTNO>
                            <SUBJECT>DD Form 448, Military Interdepartmental Purchase Request.</SUBJECT>
                            <SECTNO>253.208-2</SECTNO>
                            <SUBJECT>DD Form 448-2, Acceptance of MIPR.</SUBJECT>
                            <SECTNO>253.209</SECTNO>
                            <SUBJECT>Contractor qualifications.</SUBJECT>
                            <SECTNO>253.209-1</SECTNO>
                            <SUBJECT>Responsible prospective contractors.</SUBJECT>
                            <SECTNO>253.213</SECTNO>
                            <SUBJECT>Simplified acquisition procedures (SF's 18, 30, 44, 1165, 1449, and OF's 336, 347, and 348).</SUBJECT>
                            <SECTNO>253.213-70</SECTNO>
                            <SUBJECT>Completion of DD Form 1155, Order for Supplies or Services.</SUBJECT>
                            <SECTNO>253.215</SECTNO>
                            <SUBJECT>Contracting by negotiation.</SUBJECT>
                            <SECTNO>253.215-70</SECTNO>
                            <SUBJECT>DD Form 1547, Record of Weighted Guidelines Application.</SUBJECT>
                        </SUBPART>
                        <SUBPART>
                            <HD SOURCE="HED">Subpart 253.3—Illustration of Forms</HD>
                            <SECTNO>253.303</SECTNO>
                            <SUBJECT>Agency forms.</SUBJECT>
                        </SUBPART>
                    </CONTENTS>
                    <AUTH>
                        <HD SOURCE="HED">Authority:</HD>
                        <P>41 U.S.C. 421 and 48 CFR chapter 1.</P>
                    </AUTH>
                    <SOURCE>
                        <HD SOURCE="HED">Source:</HD>
                        <P>56 FR 36554, July 31, 1991, unless otherwise noted.</P>
                    </SOURCE>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 253.2—Prescription of Forms</HD>
                        <SECTION>
                            <SECTNO>253.208</SECTNO>
                            <SUBJECT>Required sources of supplies and services.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>253.208-1</SECTNO>
                            <SUBJECT>DD Form 448, Military Interdepartmental Purchase Request.</SUBJECT>
                            <P>Follow the procedures at PGI 253.208-1 for use of DD Form 448.</P>
                            <CITA>[71 FR 39005, July 11, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>253.208-2</SECTNO>
                            <SUBJECT>DD Form 448-2, Acceptance of MIPR.</SUBJECT>
                            <P>Follow the procedures at PGI 253.208-2 for use of DD Form 448-2.</P>
                            <CITA>[71 FR 39005, July 11, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>253.209</SECTNO>
                            <SUBJECT>Contractor qualifications.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>253.209-1</SECTNO>
                            <SUBJECT>Responsible prospective contractors.</SUBJECT>
                            <P>
                                (a) 
                                <E T="03">SF 1403, Preaward Survey of Prospective Contractor (General).</E>
                                 (i) The factors in Section III, Block 19, generally mean—
                            </P>
                            <P>
                                (A) 
                                <E T="03">Technical capability.</E>
                                 An assessment of the prospective contractor's 
                                <PRTPAGE P="757"/>
                                key management personnel to determine if they have the basic technical knowledge, experience, and understanding of the requirements necessary to produce the required product or provide the required service.
                            </P>
                            <P>
                                (B) 
                                <E T="03">Production capability.</E>
                                 An evaluation of the prospective contractor's ability to plan, control, and integrate manpower, facilities, and other resources necessary for successful contract completion. This includes—
                            </P>
                            <P>
                                (
                                <E T="03">1</E>
                                ) An assessment of the prospective contractor's possession of, or the ability to acquire, the necessary facilities, material, equipment, and labor; and
                            </P>
                            <P>
                                (
                                <E T="03">2</E>
                                ) A determination that the prospective contractor's system provides for timely placement of orders and for vendor follow-up and control.
                            </P>
                            <P>
                                (C) 
                                <E T="03">Quality assurance capability.</E>
                                 An assessment of the prospective contractor's capability to meet the quality assurance requirements of the proposed contract. It may involve an evaluation of the prospective contractor's quality assurance system, personnel, facilities, and equipment.
                            </P>
                            <P>
                                (D) 
                                <E T="03">Financial capability.</E>
                                 A determination that the prospective contractor has or can get adequate financial resources to obtain needed facilities, equipment, materials, etc.
                            </P>
                            <P>
                                (E) 
                                <E T="03">Accounting system and related internal controls.</E>
                                 An assessment by the auditor of the adequacy of the prospective contractor's accounting system and related internal controls as defined in 242.7501, Definition. Normally, a contracting officer will request an accounting system review when soliciting and awarding cost-reimbursement or incentive type contracts, or contracts which provide for progress payments based on costs or on a percentage or stage of completion.
                            </P>
                            <P>(ii) The factors in section III, Block 20, generally mean—</P>
                            <P>
                                (A) 
                                <E T="03">Government property control.</E>
                                 An assessment of the prospective contractor's capability to manage and control Government property.
                            </P>
                            <P>
                                (B) 
                                <E T="03">Transportation.</E>
                                 An assessment of the prospective contractor's capability to follow the laws and regulations applicable to the movement of Government material, or overweight, oversized, hazardous cargo, etc.
                            </P>
                            <P>
                                (C) 
                                <E T="03">Packaging.</E>
                                 An assessment of the prospective contractor's ability to meet all contractual packaging requirements including preservation, unit pack, packing, marking, and unitizing for shipment.
                            </P>
                            <P>
                                (D) 
                                <E T="03">Security clearance.</E>
                                 A determination that the prospective contractor's facility security clearance is adequate and current. (When checked, the surveying activity will refer this factor to the Defense Security Service (DSS)).
                            </P>
                            <P>
                                (E) 
                                <E T="03">Plant safety.</E>
                                 An assessment of the prospective contractor's ability to meet the safety requirements in the solicitation.
                            </P>
                            <P>
                                (F) 
                                <E T="03">Environmental/energy consideration.</E>
                                 An evaluation of the prospective contractor's ability to meet specific environmental and energy requirements in the solicitation.
                            </P>
                            <P>
                                (G) 
                                <E T="03">Flight operations and flight safety.</E>
                                 An evaluation of the prospective contractor's ability to meet flight operation and flight safety requirements on solicitations involving the overhaul and repair of aircraft.
                            </P>
                            <P>
                                (H) 
                                <E T="03">Other.</E>
                                 If the contracting officer wants an assessment of other than major factors A-E and other factors A-G, check this factor. Explain the desired information in the Remarks sections.
                            </P>
                            <CITA>[56 FR 36554, July 31, 1991, as amended at 60 FR 29504, June 5, 1995; 64 FR 51077, Sept. 21, 1999]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>253.213</SECTNO>
                            <SUBJECT>Simplified acquisition procedures (SF's 18, 30, 44, 1165, 1449, and OF's 336, 347, and 348).</SUBJECT>
                            <P>(f) DoD uses the DD Form 1155, Order for Supplies or Services, instead of OF 347; and OF 336, Continuation Sheet, instead of OF 348. Follow the procedures at PGI 253.213(f) for use of forms.</P>
                            <CITA>[71 FR 3413, Jan. 23, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <SECTNO>253.213-70</SECTNO>
                            <SUBJECT>Completion of DD Form 1155, Order for Supplies or Services.</SUBJECT>
                            <P>Follow the procedures at PGI 253.213-70 for completion of DD Form 1155.</P>
                            <CITA>[71 FR 3413, Jan. 23, 2006]</CITA>
                        </SECTION>
                        <SECTION>
                            <PRTPAGE P="758"/>
                            <SECTNO>253.215</SECTNO>
                            <SUBJECT>Contracting by negotiation.</SUBJECT>
                        </SECTION>
                        <SECTION>
                            <SECTNO>253.215-70</SECTNO>
                            <SUBJECT>DD Form 1547, Record of Weighted Guidelines Application.</SUBJECT>
                            <P>Follow the procedures at PGI 253.215-70 for completing DD Form 1547.</P>
                            <CITA>[71 FR 69495, Dec. 1, 2006]</CITA>
                        </SECTION>
                    </SUBPART>
                    <SUBPART>
                        <HD SOURCE="HED">Subpart 253.3—Illustration of Forms</HD>
                        <SECTION>
                            <SECTNO>253.303</SECTNO>
                            <SUBJECT>Agency forms.</SUBJECT>
                            <P>
                                DoD forms are available at 
                                <E T="03">https://www.esd.whs.mil/Directives/forms/.</E>
                            </P>
                            <CITA>[86 FR 27278, May 20, 2021]</CITA>
                        </SECTION>
                    </SUBPART>
                </PART>
            </SUBCHAP>
            <SUBCHAP TYPE="P">
                <PRTPAGE P="759"/>
                <HD SOURCE="HED">SUBCHAPTER I—AGENCY SUPPLEMENTARY REGULATIONS</HD>
                <PART>
                    <RESERVED>PARTS 254-299 [RESERVED]</RESERVED>
                    <APPENDIX>
                        <EAR>Ch. 2, App. A</EAR>
                        <HD SOURCE="HED">Appendix A to Chapter 2—Armed Services Board of Contract Appeals</HD>
                        <FP>Pt.</FP>
                        <FP SOURCE="FP-2">
                            <E T="05">Part 1—Charter</E>
                        </FP>
                        <FP SOURCE="FP-2">
                            <E T="05">Part 2—Rules</E>
                        </FP>
                        <AUTH>
                            <HD SOURCE="HED">Authority:</HD>
                            <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                        </AUTH>
                        <HD SOURCE="HD1">Armed Services Board of Contract Appeals</HD>
                        <FP SOURCE="FP-1">
                            <E T="03">Approved 1 May 1962</E>
                        </FP>
                        <FP SOURCE="FP-1">
                            <E T="03">Revised 1 May 1969</E>
                        </FP>
                        <FP SOURCE="FP-1">
                            <E T="03">Revised 1 September 1973</E>
                        </FP>
                        <FP SOURCE="FP-1">
                            <E T="03">Revised 1 July 1979</E>
                        </FP>
                        <FP SOURCE="FP-1">
                            <E T="03">Revised 14 May 2007</E>
                        </FP>
                        <FP SOURCE="FP-1">
                            <E T="03">Revised 9 April 2018</E>
                        </FP>
                        <FP SOURCE="FP-1">
                            <E T="03">Revised 23 May 2019</E>
                        </FP>
                        <HD SOURCE="HD1">Part 1—Charter</HD>
                        <P>1. There is created the Armed Services Board of Contract Appeals which is hereby designated as the authorized representative of the Secretary of Defense, the Secretary of the Army, the Secretary of the Navy, and the Secretary of the Air Force, in hearing, considering and determining appeals by contractors from decisions of contracting officers or their authorized representatives or other authorities on disputed questions. These appeals may be taken (a) pursuant to the Contract Disputes Act of 1978 (41 U.S.C. Sections 7101-7109), (b) pursuant to the provisions of contracts requiring the decision by the Secretary of Defense or by a Secretary of a Military Department or their duly authorized representative, or (c) pursuant to the provisions of any directive whereby the Secretary of Defense or the Secretary of a Military Department or their authorized representative has granted a right of appeal not contained in the contract on any matter consistent with the contract appeals procedure. The Board may determine contract disputes for other departments and agencies by agreement as permitted by law. The Board shall operate under general policies established or approved by the Under Secretary of Defense responsible for acquisition and may perform other duties as directed not inconsistent with the Contract Disputes Act of 1978. The Board shall decide the matters before it independently.</P>
                        <P>2. Membership of the Board shall consist of attorneys at law who have been qualified in the manner prescribed by the Contract Disputes Act of 1978. Appointment of Board members shall be made by the Secretary of Defense. Members of the Board are hereby designated Administrative Judges. There shall be designated from among the appointed Judges of the Board a Chairman and two or more Vice Chairmen. Designation of the Chairman and Vice Chairmen shall be made by the Secretary of Defense, of nominees from Judges of the Board recommended by the Under Secretary of Defense responsible for acquisition, in coordination with the General Counsel of the Department of Defense, and the Assistant Secretaries of the Military Departments responsible for acquisition. When there is a vacancy, the incumbent is unavailable, or for appropriate Board administrative reasons, the Under Secretary of Defense responsible for acquisition or the Chairman may designate a Judge of the Board to serve as an Acting Chairman or Acting Vice Chairman.</P>
                        <P>3. The Chairman of the Board shall be responsible for establishing appropriate divisions of the Board to provide for the most effective and expeditious handling of appeals. The Chairman shall have authority to establish procedures for the issuance of Board decisions. The Chairman may refer an appeal of unusual difficulty, significant precedential importance, or serious dispute within the normal decision process for decision by a Senior Deciding Group established by the Chairman which shall have the authority to overturn prior Board precedent.</P>
                        <P>4. It shall be the duty and obligation of the Judges of the Armed Services Board of Contract Appeals to decide appeals on the record of the appeal to the best of their knowledge and ability in accordance with applicable contract provisions and in accordance with law and regulation pertinent thereto.</P>
                        <P>5. Any Judge of the Board or any examiner, designated by the Chairman, shall be authorized to hold hearings, examine witnesses, and receive evidence and argument. A Judge of the Board shall have authority to administer oaths and issue subpoenas as specified in the Contract Disputes Act of 1978. In cases of contumacy or refusal to obey a subpoena, the Chairman may request orders of the court in the manner prescribed in the Contract Disputes Act of 1978.</P>
                        <P>6. The Board shall have all powers necessary and incident to the proper performance of its duties. The Board has the authority to issue methods of procedure and rules and regulations for its conduct and for the preparation and presentation of appeals and issuance of opinions.</P>
                        <P>
                            7. The Chairman shall be responsible for the internal organization of the Board and for its administration. The Chairman shall provide within approved ceilings for the staffing of the Board with non-Judge personnel, including hearing examiners, as may 
                            <PRTPAGE P="760"/>
                            be required for the performance of the functions of the Board. The Chairman shall appoint a Recorder of the Board. All personnel shall be responsible to and shall function under the direction, supervision and control of the Chairman.
                        </P>
                        <P>8. The Board will be serviced by the Department of the Army for administrative support as required for its operations. Administrative support will include budgeting, funding, fiscal control, manpower control and utilization, personnel administration, security administration, supplies, and other administrative services. The Departments of the Army, Navy, Air Force and the Office of the Secretary of Defense will participate in financing the Board's operations on an equal basis and to the extent determined by the Under Secretary of Defense (Comptroller). The cost of processing appeals for departments and agencies other than those in the Department of Defense will be reimbursed.</P>
                        <P>9. Within 30 days following the close of a fiscal year, the Chairman shall forward a report of the Board's transactions and proceedings for the preceding fiscal year to the Under Secretary of Defense responsible for acquisition, the General Counsel of the Department of Defense, and the Assistant Secretaries of the Military Departments responsible for acquisition.</P>
                        <P>10. The Board shall have a seal bearing the following inscription: “Armed Services Board of Contract Appeals.” This seal shall be affixed to all authentications of copies of records and to such other instruments as the Board may determine.</P>
                        <P>11. This revised charter is effective upon the date of the signature of the Secretary of Defense.</P>
                        <P>Approved:</P>
                        <HD SOURCE="HD3">(signed) Kenneth J. Krieg (14 May 2007),</HD>
                        <FP>
                            <E T="03">Under Secretary of Defense (Acquisition, Technology and Logistics).</E>
                        </FP>
                        <HD SOURCE="HD3">(signed) William J. Haynes II,</HD>
                        <FP>
                            <E T="03">General Counsel of the Department of Defense.</E>
                        </FP>
                        <HD SOURCE="HD3">(signed) Claude M. Bolton, Jr.,</HD>
                        <FP>
                            <E T="03">Assistant Secretary of the Army (Acquisition, Logistics, &amp; Technology).</E>
                        </FP>
                        <HD SOURCE="HD3">(signed) Delores M. Etter,</HD>
                        <FP>
                            <E T="03">Assistant Secretary of the Navy (Research, Development &amp; Acquisition).</E>
                        </FP>
                        <HD SOURCE="HD3">(signed) Sue C. Peyton,</HD>
                        <FP>
                            <E T="03">Assistant Secretary of the Air Force (Acquisition).</E>
                        </FP>
                        <HD SOURCE="HD1">Part 2—Rules</HD>
                        <FP SOURCE="FP-2">Approved 15 July 1963</FP>
                        <FP SOURCE="FP-2">Revised 1 May 1969</FP>
                        <FP SOURCE="FP-2">Revised 1 September 1973</FP>
                        <FP SOURCE="FP-2">Revised 30 June 1980</FP>
                        <FP SOURCE="FP-2">Revised 11 May 2011</FP>
                        <FP SOURCE="FP-2">Revised 21 July 2014</FP>
                        <HD SOURCE="HD1">Preface</HD>
                        <HD SOURCE="HD1">I. Jurisdiction for Considering Appeals</HD>
                        <P>The Armed Services Board of Contract Appeals (referred to herein as the Board) has jurisdiction to decide any appeal from a final decision of a contracting officer, pursuant to the Contract Disputes Act, 41 U.S.C. 7101-7109, or its Charter, 48 CFR Chap. 2, App. A, Pt. 1, relative to a contract made by the Department of Defense, the Department of the Army, the Department of the Navy, the Department of the Air Force, the National Aeronautics and Space Administration or any other department or agency, as permitted by law.</P>
                        <HD SOURCE="HD1">II. Location and Organization of the Board</HD>
                        <P>
                            (a) The Board's address is Skyline Six, Room 703, 5109 Leesburg Pike, Falls Church, VA 22041-3208; telephone 703-681-8500 (general), 703-681-8502 (Recorder). The Board's facsimile number is 703-681-8535. The Board's Recorder's email address is 
                            <E T="03">asbca.recorder@mail.mil.</E>
                             The Board's Web site address is 
                            <E T="03">http://www.asbca.mil.</E>
                        </P>
                        <P>(b) The Board consists of a Chairman, two or more Vice Chairmen, and other Members, all of whom are attorneys at law duly licensed by a state, commonwealth, territory, or the District of Columbia. Board Members are designated Administrative Judges.</P>
                        <P>(c) There are a number of divisions of the Board, established by the Chairman in such manner as to provide for the most effective and expeditious handling of appeals. The Chairman and a Vice Chairman act as members of each division. Hearings may be held by an Administrative Judge or by a duly authorized examiner. Except for appeals processed under the expedited or accelerated procedure (see Rules 12.2(c) and 12.3(c)), the decision of a majority of a division constitutes the decision of the Board, unless the Chairman refers the appeal to the Board's Senior Deciding Group (consisting of the Chairman, Vice Chairmen, all division heads, and the Judge who drafted the decision), in which event a decision of a majority of that group constitutes the decision of the Board. Appeals referred to the Senior Deciding Group are those of unusual difficulty or significant precedential importance, or that have occasioned serious dispute within the normal division decision process.</P>
                        <P>
                            (d) The Board will to the fullest extent practicable provide informal, expeditious, and inexpensive resolution of disputes.
                            <PRTPAGE P="761"/>
                        </P>
                        <HD SOURCE="HD1">Table of Contents</HD>
                        <HD SOURCE="HD1">Rules of the Armed Services Board of Contract Appeals</HD>
                        <FP SOURCE="FP-1">Rule 1 Appeals</FP>
                        <FP SOURCE="FP-1">Rule 2 Filing Documents</FP>
                        <FP SOURCE="FP-1">Rule 3 Service Upon Other Parties</FP>
                        <FP SOURCE="FP-1">Rule 4 Preparation, Content, Organization, Forwarding, and Status of Appeal File</FP>
                        <FP SOURCE="FP-1">Rule 5 Time, Computation, and Extensions</FP>
                        <FP SOURCE="FP-1">Rule 6 Pleadings</FP>
                        <FP SOURCE="FP-1">Rule 7 Motions</FP>
                        <FP SOURCE="FP-1">Rule 8 Discovery</FP>
                        <FP SOURCE="FP-1">Rule 9 Pre-Hearing or Pre-Submission Conference</FP>
                        <FP SOURCE="FP-1">Rule 10 Hearings</FP>
                        <FP SOURCE="FP-1">Rule 11 Submission Without a Hearing</FP>
                        <FP SOURCE="FP-1">Rule 12 Optional Small Claims (Expedited) and Accelerated Procedures</FP>
                        <FP SOURCE="FP-1">Rule 13 Settling the Record in Appeals with a Hearing</FP>
                        <FP SOURCE="FP-1">Rule 14 Briefs</FP>
                        <FP SOURCE="FP-1">Rule 15 Representation</FP>
                        <FP SOURCE="FP-1">Rule 16 Sanctions</FP>
                        <FP SOURCE="FP-1">Rule 17 Dismissal or Default for Failure to Prosecute or Defend</FP>
                        <FP SOURCE="FP-1">Rule 18 Suspensions; Dismissal without Prejudice</FP>
                        <FP SOURCE="FP-1">Rule 19 Decisions</FP>
                        <FP SOURCE="FP-1">Rule 20 Motion for Reconsideration</FP>
                        <FP SOURCE="FP-1">Rule 21 Remand from Court</FP>
                        <FP SOURCE="FP-1">Rule 22 Subpoenas</FP>
                        <FP SOURCE="FP-1">Rule 23 Ex Parte Communications</FP>
                        <FP SOURCE="FP-1">Rule 24 Effective Date</FP>
                        <HD SOURCE="HD1">Addendums</HD>
                        <FP SOURCE="FP-1">Addendum I: Equal Access to Justice Act Procedures</FP>
                        <FP SOURCE="FP-1">Addendum II: Alternative Methods of Dispute Resolution</FP>
                        <HD SOURCE="HD1">Rules</HD>
                        <HD SOURCE="HD1">Rule 1. Appeals</HD>
                        <P>
                            (a) 
                            <E T="03">Taking an Appeal</E>
                            —For appeals subject to the Contract Disputes Act, notice of an appeal shall be in writing and mailed or otherwise furnished to the Board within 90 days from the date of receipt of a contracting officer's decision. The appellant (contractor) should also furnish a copy of the notice of appeal to the contracting officer. For appeals not subject to the Contract Disputes Act, the contractor should refer to the Disputes clause in its contract for the time period in which it must file a notice of appeal.
                        </P>
                        <P>(1) Where the contractor has submitted a claim of $100,000 or less to the contracting officer and has requested a written decision within 60 days from receipt of the request, and the contracting officer has not provided a decision within that period, or where such a contractor request has not been made and the contracting officer has not issued a decision within a reasonable time, the contractor may file a notice of appeal as provided in paragraph (a) of this Rule, citing the failure of the contracting officer to issue a decision.</P>
                        <P>(2) Where the contractor has submitted a properly certified claim over $100,000 to the contracting officer or has submitted a claim that involves no monetary amount, and the contracting officer, within 60 days of receipt of the claim, fails to issue a decision or fails to provide the contractor with a reasonable date by which a decision will be issued, and the contracting officer has failed to issue a decision within a reasonable time, the contractor may file a notice of appeal as provided in paragraph (a) of this Rule, citing the failure of the contracting officer to issue a decision.</P>
                        <P>(3) A reasonable time shall be determined by taking into account such factors as the size and complexity of the claim and the adequacy of the information provided by the contractor to support the claim.</P>
                        <P>(4) Where an appeal is before the Board pursuant to paragraph (a)(1) or (a)(2) of this Rule, the Board may, at its option, stay further proceedings pending issuance of a final decision by the contracting officer within such period of time as is determined by the Board.</P>
                        <P>(5) In lieu of filing a notice of appeal under paragraph (a)(1) or (a)(2) of this Rule, the contractor may petition the Board to direct the contracting officer to issue a decision in a specified period of time as determined by the Board.</P>
                        <P>
                            (b) 
                            <E T="03">Contents of Notice of Appeal</E>
                            —A notice of appeal shall indicate that an appeal is being taken and should identify the contract by number, the department and/or agency involved in the dispute, the decision from which the appeal is taken, and the amount in dispute, if any. A copy of the contracting officer's final decision, if any, should be attached to the notice of appeal. The notice of appeal should be signed by the appellant or by the appellant's duly authorized representative or attorney. The complaint referred to in Rule 6 may be filed with the notice of appeal, or the appellant may designate the notice of appeal as a complaint, if it otherwise fulfills the requirements of a complaint.
                        </P>
                        <P>
                            (c) 
                            <E T="03">Docketing of Appeal</E>
                            —When a notice of appeal has been received by the Board, it will be docketed. The Board will provide a written notice of docketing to the appellant and to the Government.
                        </P>
                        <HD SOURCE="HD1">Rule 2. Filing Documents</HD>
                        <P>(a) Documents may be filed with the Board by the following methods:</P>
                        <P>
                            (1) 
                            <E T="03">Governmental Postal Service</E>
                            —Documents may be filed via a governmental postal service. Filing occurs when the document, properly addressed and with sufficient postage, is transferred into the custody of the postal service. Contact the Recorder before submitting classified documents.
                            <PRTPAGE P="762"/>
                        </P>
                        <P>
                            (2) 
                            <E T="03">Courier</E>
                            —Documents may be filed via courier. Filing occurs when the document is delivered to the Board. Contact the Recorder before submitting classified documents.
                        </P>
                        <P>
                            (3) 
                            <E T="03">Electronic Mail</E>
                            —Documents, except appeal files submitted pursuant to Rule 4, hearing exhibits, classified documents, and documents submitted in camera or under a protective order, may be filed via electronic mail (email). Email attachments should be in PDF format and the attachments may not exceed 10 megabytes total. The transmittal email should include the ASBCA docket number(s), if applicable, and the name of the appellant in the “Subject:” line. Filing occurs upon receipt by the Board's email server. When a document is successfully filed via email, the document should not also be submitted by any other means, unless so directed by the Board. Submit emails to: 
                            <E T="03">asbca.recorder@mail.mil.</E>
                        </P>
                        <P>
                            (4) 
                            <E T="03">Facsimile Transmission</E>
                            —Documents, except appeal files submitted pursuant to Rule 4, hearing exhibits, classified documents, and documents submitted in camera or under a protective order, may be filed via facsimile (fax) machine. Due to equipment constraints, transmissions over 10 pages should not be made absent Board permission. Filing occurs upon receipt by the Board. When a document is successfully filed via fax, the document should not also be submitted by any other means, unless so directed by the Board.
                        </P>
                        <P>
                            (b) 
                            <E T="03">Copies to Opposing Party</E>
                            —The party filing any document with the Board will send a copy to the opposing party unless the Board directs otherwise, noting on the document filed with the Board that a copy has been so furnished.
                        </P>
                        <HD SOURCE="HD1">Rule 3. Service Upon Other Parties</HD>
                        <P>Documents may be served personally or by mail, addressed to the party upon whom service is to be made, unless the parties have agreed to an alternate means of service. Subpoenas shall be served as provided in Rule 22.</P>
                        <HD SOURCE="HD1">Rule 4. Preparation, Content, Organization, Forwarding, and Status of Appeal File</HD>
                        <P>
                            (a) 
                            <E T="03">Duties of the Government</E>
                            —Within 30 days of notice that an appeal has been filed, the Government shall transmit to the Board and the appellant an appeal file consisting of the documents the Government considers relevant to the appeal, including:
                        </P>
                        <P>(1) The decision from which the appeal is taken;</P>
                        <P>(2) The contract, including pertinent specifications, amendments, plans, and drawings;</P>
                        <P>(3) All correspondence between the parties relevant to the appeal, including any claim in response to which the decision was issued.</P>
                        <P>The Government's appeal file may be supplemented at such times as are fair and reasonable and as ordered by the Board.</P>
                        <P>
                            (b) 
                            <E T="03">Duties of the Appellant</E>
                            —Within 30 days after receipt of a copy of the Government's appeal file, the appellant shall transmit to the Board and the Government any documents not contained therein that the appellant considers relevant to the appeal. Appellant's appeal file may be supplemented at such times as are fair and reasonable and as ordered by the Board.
                        </P>
                        <P>
                            (c) 
                            <E T="03">Organization of Appeal File</E>
                            —Documents in the appeal file may be originals or legible copies, and shall be arranged in chronological order where practicable, tabbed with sequential numbers, and indexed to identify the contents of the file. Any document without internal page numbers shall have page numbers added. All documents must be in English or include an English translation. Documents shall be submitted in 3-ring binders, with spines not wider than 3 inches wide, with labels identifying the name of the appeal, ASBCA number and tab numbers contained in each volume, on the front and spine of each volume. Each volume shall contain an index of the documents contained in the entire Rule 4 submission.
                        </P>
                        <P>
                            (d) 
                            <E T="03">Status of Documents in Appeal File</E>
                            —Documents contained in the appeal file are considered, without further action by the parties, as part of the record upon which the Board will render its decision. However, a party may object, for reasons stated, to the admissibility of a particular document reasonably in advance of hearing or, if there is no hearing, of settling the record, or in any case as ordered by the Board. If such objection is made, the Board will constructively remove the document from the appeal file and permit the party offering the document to move its admission as evidence in accordance with Rules 10, 11, and 13.
                        </P>
                        <HD SOURCE="HD1">Rule 5. Time, Computation, and Extensions</HD>
                        <P>(a) Where practicable, actions should be taken in less time than the time allowed. Where appropriate and justified, however, extensions of time will be granted. All requests for extensions of time should be in writing and indicate that the other party was contacted to seek its concurrence.</P>
                        <P>(b) In computing any period of time, the day of the event from which the designated period of time begins to run will not be included, but the last day of the period will be included unless it is a Saturday, Sunday, or a Federal holiday, in which event the period will run to the next business day.</P>
                        <HD SOURCE="HD1">Rule 6. Pleadings</HD>
                        <P>
                            (a) 
                            <E T="03">Appellant</E>
                            —Within 30 days after receipt of notice of docketing of the appeal, the appellant shall file with the Board a complaint setting forth simple, concise, and direct statements of each of its claims. The complaint shall also set forth the basis, with appropriate reference to contract provisions, of 
                            <PRTPAGE P="763"/>
                            each claim and the dollar amount claimed, if any. This pleading shall fulfill the generally recognized requirements of a complaint, although no particular form is required. Should the complaint not be timely received, the appellant's claim and notice of appeal may be deemed to set forth its complaint if, in the opinion of the Board, the issues before the Board are sufficiently defined, and the parties will be notified.
                        </P>
                        <P>
                            (b) 
                            <E T="03">Government</E>
                            —Within 30 days from receipt of the complaint, or the aforesaid notice from the Board, the Government shall file with the Board an answer thereto. The answer shall admit or deny the allegations of the complaint and shall set forth simple, concise, and direct statements of the Government's defenses to each claim asserted by the appellant, including any affirmative defenses. Should the answer not be timely received, the Board may enter a general denial on behalf of the Government, and the parties will be notified.
                        </P>
                        <P>
                            (c) 
                            <E T="03">Foreign Law</E>
                            —A party who intends to raise an issue concerning the law of a foreign country shall give notice in its pleadings or other reasonable written notice. The Board, in determining foreign law, may consider any relevant material or source, including testimony, whether or not submitted by a party or admissible under Rules 10, 11, or 13. The determination of foreign law shall be treated as a ruling on a question of law.
                        </P>
                        <P>
                            (d) 
                            <E T="03">Further Pleadings</E>
                            —The Board upon its own initiative or upon motion may order a party to make a more definite statement of the complaint or answer, or to reply to an answer. The Board may permit either party to amend its pleading upon conditions fair to both parties. When issues within the proper scope of the appeal, but not raised by the pleadings, are tried by express or implied consent of the parties, or by permission of the Board, they shall be treated in all respects as if they had been raised therein. In such instances, motions to amend the pleadings to conform to the proof may be entered, but are not required. If evidence is objected to at a hearing on the ground that it is not within the issues raised by the pleadings, it may be admitted within the proper scope of the appeal, provided however, that the objecting party may be granted an opportunity to meet such evidence.
                        </P>
                        <HD SOURCE="HD1">Rule 7. Motions</HD>
                        <P>
                            (a) 
                            <E T="03">Motions Generally</E>
                            —The Board may entertain and rule upon motions and may defer ruling as appropriate. The Board will rule on motions so as to secure, to the fullest extent practicable, the informal, expeditious, and inexpensive resolution of appeals. All motions should be filed as separate documents with an appropriate heading describing the motion. Oral argument on motions is subject to the discretion of the Board.
                        </P>
                        <P>
                            (b) 
                            <E T="03">Jurisdictional Motions</E>
                            —Any motion addressed to the jurisdiction of the Board should be promptly filed. An evidentiary hearing to address disputed jurisdictional facts will be afforded on application of either party or by order of the Board. The Board may defer its decision on the motion pending hearing on the merits. The Board may at any time and on its own initiative raise the issue of its jurisdiction, and shall do so by an appropriate order, affording the parties an opportunity to be heard thereon.
                        </P>
                        <P>
                            (c) 
                            <E T="03">Summary Judgment Motions</E>
                            —
                        </P>
                        <P>(1) To facilitate disposition of such a motion, the parties should adhere to the following procedures. Where the parties agree that disposition by summary judgment or partial summary judgment is appropriate, they may file a stipulation of all material facts necessary for the Board to rule on the motion. Otherwise, the moving party should file with its motion a “Statement of Undisputed Material Facts,” setting forth the claimed undisputed material facts in separate, numbered paragraphs. The non-moving party should file a “Statement of Genuine Issues of Material Fact,” responding to each numbered paragraph proposed, demonstrating, where appropriate, the existence of material facts in dispute and if appropriate propose additional facts. The moving party and the non-moving party should submit a memorandum of law supporting or opposing summary judgment.</P>
                        <P>(2) In deciding motions for summary judgment, the Board looks to Rule 56 of the Federal Rules of Civil Procedure for guidance. The parties should explicitly state and support by specific evidence all facts and legal arguments necessary to sustain a party's position. Each party should cite to the record and attach any additional evidence upon which it relies (e.g., affidavits, declarations, excerpts from depositions, answers to interrogatories, admissions). The Board may accept a fact properly proposed and supported by one party as undisputed, unless the opposing party properly responds and establishes that it is in dispute.</P>
                        <P>
                            (d) 
                            <E T="03">Response to Motions</E>
                            —A non-moving party has 30 days from receipt of a motion to file its response, unless a different period is ordered by the Board. A moving party has 30 days from receipt of a non-moving party's response to file a reply, unless a different period is ordered by the Board.
                        </P>
                        <HD SOURCE="HD1">Rule 8. Discovery</HD>
                        <P>
                            (a) 
                            <E T="03">General Policy and Protective Orders</E>
                            —The parties are encouraged to engage in voluntary discovery procedures. Within 45 days after the pleadings have been filed, the parties must confer concerning each party's discovery needs, including the scheduling of discovery and the production of electronically stored information. Absent stipulation or a Board order, no discovery may be served 
                            <PRTPAGE P="764"/>
                            prior to this conference. Any motion pertaining to a discovery dispute shall include a statement that the movant has in good faith attempted to resolve the discovery dispute without involvement of the Board. In connection with any discovery procedure, the Board may issue orders to protect a party or person from annoyance, embarrassment, or undue burden or expense. Those orders may include limitations on the scope, method, time, and place for discovery, and provisions for governing the disclosure of information or documents. Any discovery under this Rule shall be subject to the provisions of Rule 16 with respect to sanctions.
                        </P>
                        <P>
                            (b) 
                            <E T="03">Depositions—When Permitted</E>
                            —Subject to paragraph (a) of this Rule, a party may take, or the Board may upon motion order the taking of, testimony of any person by deposition upon oral examination or written interrogatories before any officer authorized to administer oaths at the place of examination, for use as evidence or for purpose of discovery. The Board expects the parties to make persons under their control available for deposition. The motion for an order shall specify whether the purpose of the deposition is discovery or for use as evidence.
                        </P>
                        <P>
                            (1) 
                            <E T="03">Depositions—Orders</E>
                            —The time, place, and manner of taking depositions shall be as mutually agreed by the parties, or failing such agreement, governed by order of the Board.
                        </P>
                        <P>
                            (2) 
                            <E T="03">Depositions—Use as Evidence</E>
                            —No testimony taken by deposition shall be considered as part of the evidence in the hearing of an appeal until such testimony is offered and received in evidence at such hearing. It will not ordinarily be received in evidence if the deponent can testify at the hearing. The deposition may be used to contradict or impeach the testimony of the deponent given at a hearing. In cases submitted on the record, the Board may receive depositions to supplement the record.
                        </P>
                        <P>
                            (3) 
                            <E T="03">Depositions—Expenses</E>
                            —Each party shall bear its own expenses associated with the taking of any deposition, absent an agreement by the parties or a Board order to the contrary.
                        </P>
                        <P>
                            (4) 
                            <E T="03">Depositions—Subpoenas</E>
                            —Where appropriate, a party may request the issuance of a subpoena under the provisions of Rule 22.
                        </P>
                        <P>
                            (c) 
                            <E T="03">Interrogatories, Requests for Admissions, Requests for Production</E>
                            —Subject to paragraph (a) of this Rule, a party may serve, or the Board may upon motion order:
                        </P>
                        <P>(1) Written interrogatories to be answered separately in writing, signed under oath and answered or objected to within 45 days after service;</P>
                        <P>(2) A request for the admission of specified facts and/or of the authenticity of any documents, to be answered or objected to within 45 days after service, the factual statements and/or the authenticity of the documents to be deemed admitted upon failure of a party to respond to the request; and</P>
                        <P>(3) A request for the production, inspection, and copying of any documents, electronic or otherwise, or objects, not privileged, which reasonably may lead to the discovery of admissible evidence, to be answered or objected to within 45 days after service. The Board may allow a shorter or longer time.</P>
                        <HD SOURCE="HD1">Rule 9. Pre-Hearing or Pre-Submission Conference</HD>
                        <P>The Board may, upon its own initiative, or upon the request of either party, arrange a conference or order the parties to appear before an Administrative Judge or examiner for a conference to address any issue related to the prosecution of the appeal.</P>
                        <HD SOURCE="HD1">Rule 10. Hearings</HD>
                        <P>
                            (a) 
                            <E T="03">Where and When Held</E>
                            —Hearings will be held at such times and places determined by the Board to best serve the interests of the parties and the Board.
                        </P>
                        <P>
                            (b) 
                            <E T="03">Unexcused Absence</E>
                            —The unexcused absence of a party at the time and place set for hearing will not be occasion for delay. In the event of such absence, the hearing will proceed and the evidentiary record will consist solely of the evidence of record at the conclusion of the hearing, except as ordered otherwise by the Board.
                        </P>
                        <P>
                            (c) 
                            <E T="03">Nature of Hearings</E>
                            —Hearings shall be as informal as may be reasonable and appropriate under the circumstances. The parties may offer such evidence as they deem appropriate and as would be admissible under the Federal Rules of Evidence or in the sound discretion of the presiding Administrative Judge or examiner. The Federal Rules of Evidence are not binding on the Board but may guide the Board's rulings. The parties may stipulate the testimony that would be given by a witness if the witness were present. The Board may require evidence in addition to that offered by the parties.
                        </P>
                        <P>
                            (d) 
                            <E T="03">Examination of Witnesses</E>
                            —Witnesses will be examined orally under oath or affirmation, unless the presiding Administrative Judge or examiner shall otherwise order. If the testimony of a witness is not given under oath or affirmation, the Board may advise the witness that his or her testimony may be subject to any provision of law imposing penalties for knowingly making false representations in connection with claims.
                        </P>
                        <P>
                            (e) 
                            <E T="03">Interpreters</E>
                            —In appropriate cases, the Board may order that an interpreter be used. An interpreter must be qualified and must be placed under oath or affirmation to give a complete and true translation.
                        </P>
                        <P>
                            (f) 
                            <E T="03">Transcripts</E>
                            —Testimony and argument at hearings will be reported verbatim, unless the Board otherwise orders. The Board will 
                            <PRTPAGE P="765"/>
                            contract for a reporter. No other recordings of the proceedings will be made.
                        </P>
                        <HD SOURCE="HD1">Rule 11. Submission Without a Hearing</HD>
                        <P>(a) Either party may elect to waive a hearing and to submit its case upon the record. Submission of a case without hearing does not relieve the parties from the necessity of proving the facts supporting their allegations or defenses. Affidavits, declarations, depositions, admissions, answers to interrogatories, and stipulations may be employed in addition to the Rule 4 file if moved and accepted into evidence. Such submissions may be supplemented by briefs. The Board may designate, with notice to the parties, any document to be made part of the record.</P>
                        <P>(b) As appropriate, the Board may also rely on pleadings, prehearing conference memoranda, orders, briefs, stipulations and other documents contained in the Board's file.</P>
                        <P>(c) Except as the Board may otherwise order, no evidence will be received after notification by the Board that the record is closed.</P>
                        <P>(d) The weight to be given to any evidence will rest within the discretion of the Board. The Board may require either party, with appropriate notice to the other party, to submit additional evidence on any matter relevant to the appeal.</P>
                        <P>(e) The record will at all reasonable times be available for inspection by the parties at the offices of the Board.</P>
                        <HD SOURCE="HD1">Rule 12. Optional Small Claims (Expedited) and Accelerated Procedures</HD>
                        <HD SOURCE="HD2">12.1 Elections To Utilize Small Claims (Expedited) and Accelerated Procedures</HD>
                        <P>(a) In appeals where the amount in dispute is $50,000 or less, or in the case of a small business concern (as defined in the Small Business Act and regulations under that Act), $150,000 or less, the appellant may elect to have the appeal processed under a Small Claims (Expedited) procedure requiring decision of the appeal, whenever possible, within 120 days after the Board receives written notice of the appellant's election to utilize this procedure. The details of this procedure appear in section 12.2 of this Rule. An appellant may elect the Accelerated procedure rather than the Small Claims (Expedited) procedure for any appeal where the amount in dispute is $50,000 or less.</P>
                        <P>(b) In appeals where the amount in dispute is $100,000 or less, the appellant may elect to have the appeal processed under an Accelerated procedure requiring decision of the appeal, whenever possible, within 180 days after the Board receives written notice of the appellant's election to utilize this procedure. The details of this procedure appear in section 12.3 of this Rule.</P>
                        <P>(c) The appellant's election of either the Small Claims (Expedited) procedure or the Accelerated procedure shall be made by written notice within 60 days after receipt of notice of docketing, unless such period is extended by the Board for good cause. The election, once made, may not be changed or withdrawn except with permission of the Board and for good cause.</P>
                        <P>(d) The 45-day conference required by Rule 8(a) does not apply to Rule 12 appeals.</P>
                        <HD SOURCE="HD2">12.2 Small Claims (Expedited) Procedure</HD>
                        <P>(a) In appeals proceeding under the Small Claims (Expedited) procedure, the following time periods shall apply:</P>
                        <P>(1) Within 10 days from the Government's receipt of the appellant's notice of election of the Small Claims (Expedited) procedure, the Government shall send the Board a copy of the contract, the contracting officer's final decision, and the appellant's claim letter or letters, if any. Any other documents required under Rule 4 shall be submitted in accordance with times specified in that Rule unless the Board otherwise directs.</P>
                        <P>(2) Within 15 days after the Board has acknowledged receipt of the appellant's notice of election, the assigned Administrative Judge should take the following actions, if feasible, in a pre-hearing conference:</P>
                        <P>(i) Identify and simplify the issues;</P>
                        <P>(ii) Establish a simplified procedure, including discovery, appropriate to the particular appeal involved;</P>
                        <P>(iii) Determine whether either party elects a hearing, and if so, fix a time and place therefor; and</P>
                        <P>(iv) Establish an expedited schedule for the timely resolution of the appeal.</P>
                        <P>(b) Pleadings, discovery, and other prehearing activity will be allowed only as consistent with the requirement to conduct a hearing, or if no hearing is elected, to close the record on a date that will allow the timely issuance of the decision. The Board may shorten time periods prescribed or allowed under these Rules as necessary to enable the Board to decide the appeal within the 120-day period.</P>
                        <P>
                            (c) Written decisions by the Board in appeals processed under the Small Claims (Expedited) procedure will be short and will contain only summary findings of fact and conclusions. Decisions will be rendered for the Board by a single Administrative Judge. If there has been a hearing, the Administrative Judge presiding at the hearing may at the conclusion of the hearing and after entertaining such oral argument as deemed appropriate, render on the record oral summary findings of fact, conclusions, and a decision of the appeal. Whenever such an oral decision is rendered, the Board will subsequently furnish the parties an authenticated copy of such oral decision for record and payment purposes and to establish the starting date for the period for filing a motion for reconsideration under Rule 20.
                            <PRTPAGE P="766"/>
                        </P>
                        <P>(d) A decision under Rule 12.2 shall have no value as precedent, and in the absence of fraud, shall be final and conclusive and may not be appealed or set aside.</P>
                        <HD SOURCE="HD2">12.3 Accelerated Procedure</HD>
                        <P>(a) In appeals proceeding under the Accelerated procedure, the parties are encouraged, to the extent possible consistent with adequate presentation of their factual and legal positions, to waive pleadings, discovery, and briefs. The Board may shorten time periods prescribed or allowed under these Rules as necessary to enable the Board to decide the appeal within the 180-day period.</P>
                        <P>(b) Within 30 days after the Board has acknowledged receipt of the appellant's notice of election, the assigned Administrative Judge should take the following actions, if feasible, in a pre-hearing conference:</P>
                        <P>(1) Identify and simplify the issues;</P>
                        <P>(2) Establish a simplified procedure, including discovery, appropriate to the particular appeal involved;</P>
                        <P>(3) Determine whether either party elects a hearing, and if so, fix a time and place therefor; and</P>
                        <P>(4) Establish an accelerated schedule for the timely resolution of the appeal.</P>
                        <P>(c) Written decisions by the Board in appeals processed under the Accelerated procedure will normally be short and contain only summary findings of fact and conclusions. Decisions will be rendered for the Board by a single Administrative Judge with the concurrence of a Vice Chairman, or by a majority among these two and the Chairman in case of disagreement.</P>
                        <HD SOURCE="HD2">12.4 Motions for Reconsideration in Rule 12 Appeals</HD>
                        <P>Motions for reconsideration of appeals decided under either the Small Claims (Expedited) procedure or the Accelerated procedure need not be decided within the original 120-day or 180-day limit, but all such motions will be processed and decided promptly so as to be consistent with the intent of this Rule.</P>
                        <HD SOURCE="HD1">Rule 13. Settling the Record in Appeals With a Hearing</HD>
                        <P>(a) The record upon which the Board's decision will be rendered consists of the documents admitted under Rule 4, the documents admitted into evidence as hearing exhibits, together with the hearing transcript. The Board may designate with notice to the parties, any document to be made part of the record.</P>
                        <P>(b) As appropriate, the Board may also rely on pleadings, pre-hearing conference memoranda, orders, briefs, stipulations, and other documents contained in the Board's file.</P>
                        <P>(c) Except as the Board may otherwise order, no evidence will be received after completion of an oral hearing.</P>
                        <P>(d) The weight to be given to any evidence will rest within the discretion of the Board. The Board may require either party, with appropriate notice to the other party, to submit additional evidence on any matter relevant to the appeal.</P>
                        <P>(e) The record will at all reasonable times be available for inspection by the parties at the offices of the Board.</P>
                        <HD SOURCE="HD1">Rule 14. Briefs</HD>
                        <P>
                            (a) 
                            <E T="03">Pre-Hearing Briefs</E>
                            —The Board may require the parties to submit pre-hearing briefs. If the Board does not require pre-hearing briefs, either party may, upon appropriate and sufficient notice to the other party, furnish a pre-hearing brief to the Board.
                        </P>
                        <P>
                            (b) 
                            <E T="03">Post-Hearing Briefs</E>
                            —Post-hearing briefs may be submitted upon such terms as may be directed by the presiding Administrative Judge or examiner at the conclusion of the hearing.
                        </P>
                        <HD SOURCE="HD1">Rule 15. Representation</HD>
                        <P>(a) An individual appellant may represent his or her interests before the Board; a corporation may be represented by one of its officers; and a partnership or joint venture by one of its members; or any of these by an attorney at law duly licensed in any state, commonwealth, territory, the District of Columbia, or in a foreign country. Anyone representing an appellant shall file a written notice of appearance with the Board.</P>
                        <P>(b) The Government shall be represented by counsel. Counsel for the Government shall file a written notice of appearance with the Board.</P>
                        <HD SOURCE="HD1">Rule 16. Sanctions</HD>
                        <P>If any party fails to obey an order issued by the Board, the Board may impose such sanctions as it considers necessary to the just and expeditious conduct of the appeal.</P>
                        <HD SOURCE="HD1">Rule 17. Dismissal or Default for Failure to Prosecute or Defend</HD>
                        <P>
                            Whenever the record discloses the failure of either party to file documents required by these Rules, respond to notices or correspondence from the Board, comply with orders of the Board, or otherwise indicates an intention not to continue the prosecution or defense of an appeal, the Board may, in the case of a default by the appellant, issue an order to show cause why the appeal should not be dismissed with prejudice for failure to prosecute. In the case of a default by the Government, the Board may issue an order to show cause why the Board should not act thereon pursuant to Rule 16. If good cause is not shown, the Board may take appropriate action.
                            <PRTPAGE P="767"/>
                        </P>
                        <HD SOURCE="HD1">Rule 18. Suspensions; Dismissal Without Prejudice</HD>
                        <P>(a) The Board may suspend the proceedings by agreement of the parties for settlement discussions, or for good cause shown.</P>
                        <P>(b) In certain cases, appeals docketed before the Board are required to be placed in a suspense status and the Board is unable to proceed with disposition thereof for reasons not within the control of the Board. Where the suspension has continued, or may continue, for an inordinate length of time, the Board may dismiss such appeals from its docket for a period of time without prejudice to their restoration. Unless either party or the Board moves to reinstate the appeal within the time period set forth in the dismissal order, or if no time period is set forth, within one year from the date of the dismissal order, the dismissal shall be deemed to be with prejudice.</P>
                        <HD SOURCE="HD1">Rule 19. Decisions</HD>
                        <P>(a) Decisions of the Board will be made in writing and authenticated copies of the decision will be sent simultaneously to both parties. All orders and decisions, except those as may be required by law to be held confidential, will be available to the public. Decisions of the Board will be made solely upon the record.</P>
                        <P>(b) Any monetary award shall be promptly paid.</P>
                        <P>(c) In awards that may be paid from the Judgment Fund, 31 U.S.C. 1304, the Recorder will forward the required forms to each party with the decision. If the parties do not contemplate an appeal or motion for reconsideration, they will execute the forms indicating that no judicial review will be sought. The Government agency will forward the required forms with a copy of the decision to the Department of the Treasury for certification of payment.</P>
                        <P>(d) When the parties settle an appeal in favor of the appellant, they may file with the Board a stipulation setting forth the amount of the settlement due to the appellant. By joint motion, the parties may request that the Board issue a decision in the nature of a consent judgment, awarding the stipulated amount to the appellant. These decisions will be processed in accordance with paragraph (c) of this Rule.</P>
                        <P>(e) After a decision has become final the Board may, upon request of a party and after notice to the other party, grant the withdrawal of original exhibits, or any part thereof. The Board may require the substitution of true copies of exhibits or any part thereof as a condition of granting permission for such withdrawal.</P>
                        <HD SOURCE="HD1">Rule 20. Motion for Reconsideration</HD>
                        <P>A motion for reconsideration may be filed by either party. It shall set forth specifically the grounds relied upon to grant the motion. The motion must be filed within 30 days from the date of the receipt of a copy of the decision of the Board by the party filing the motion. An opposing party must file any cross-motion for reconsideration within 30 days from its receipt of the motion for reconsideration. Extensions in the period to file a motion will not be granted. Extensions to file a memorandum in support of a timely-filed motion may be granted.</P>
                        <HD SOURCE="HD1">Rule 21. Remand from Court</HD>
                        <P>Whenever any Court remands an appeal to the Board for further proceedings, each of the parties shall, within 30 days of receipt of such remand, submit a report to the Board recommending procedures to be followed so as to comply with the Court's remand. The Board will consider the reports and enter an order governing the remanded appeal.</P>
                        <HD SOURCE="HD1">Rule 22. Subpoenas</HD>
                        <P>
                            (a) 
                            <E T="03">Voluntary Cooperation</E>
                            —Each party is expected:
                        </P>
                        <P>(1) To cooperate and make available witnesses and evidence under its control as requested by the other party without issuance of a subpoena, and</P>
                        <P>(2) To secure voluntary attendance of desired third-party witnesses and production of desired third-party books, records, documents, or tangible things whenever possible.</P>
                        <P>
                            (b) 
                            <E T="03">General</E>
                            —Upon written request of either party, or on his or her own initiative, an Administrative Judge may issue a subpoena requiring:
                        </P>
                        <P>
                            (1) 
                            <E T="03">Testimony at a deposition</E>
                            —The deposing of a witness in the city or county where the witness resides or is employed or transacts business in person, or at another location convenient for the witness that is specifically determined by the Board;
                        </P>
                        <P>
                            (2) 
                            <E T="03">Testimony at a hearing</E>
                            —The attendance of a witness for the purpose of taking testimony at a hearing; and
                        </P>
                        <P>
                            (3) 
                            <E T="03">Production of books and records</E>
                            —The production by the witness at the deposition or hearing of books and records (including electronically stored information and other tangible things) designated in the subpoena.
                        </P>
                        <P>
                            (c) 
                            <E T="03">Request for Subpoena</E>
                            —
                        </P>
                        <P>(1) A request for subpoena shall normally be filed at least:</P>
                        <P>(i) 15 days before a scheduled deposition where the attendance of a witness at a deposition is sought; or</P>
                        <P>(ii) 30 days before a scheduled hearing where the attendance of a witness at a hearing is sought.</P>
                        <P>(2) The Board may honor a request for subpoena not made within the time limitations set forth in paragraph (c)(1) of this Rule.</P>
                        <P>
                            (3) A request for a subpoena shall state the reasonable scope and general relevance to the case of the testimony and of any books 
                            <PRTPAGE P="768"/>
                            and records sought. The Board may require resubmission of a request that does not provide this information.
                        </P>
                        <P>
                            (d) 
                            <E T="03">Requests to Quash or Modify</E>
                            —Upon written request by the person subpoenaed or by a party, made within 10 days after service but in any event not later than the time specified in the subpoena for compliance, the Board may quash or modify the subpoena if it is unreasonable or oppressive or for other good cause shown, or require the person in whose behalf the subpoena was issued to advance the reasonable cost of producing subpoenaed books and papers. Where circumstances require, the Board may act upon such a request at any time after a copy of the request has been served upon the opposing party.
                        </P>
                        <P>
                            (e) 
                            <E T="03">Form of Subpoena</E>
                            —
                        </P>
                        <P>(1) Every subpoena shall state the name of the Board and the caption of the appeal, and shall command each person to whom it is directed to attend and give testimony, and if appropriate, to produce specified books and records at a time and place therein specified. In issuing a subpoena to a requesting party, the Administrative Judge will sign the subpoena, enter the name of the witness and may otherwise leave it blank. The party to whom the subpoena is issued shall complete the subpoena before service.</P>
                        <P>(2) Where the witness is located in a foreign country, a letter rogatory may be issued and served under the circumstances and in the manner provided in 28 U.S.C. 1781.</P>
                        <P>
                            (f) 
                            <E T="03">Service</E>
                            —
                        </P>
                        <P>(1) The party requesting issuance of a subpoena shall arrange for service.</P>
                        <P>(2) A subpoena requiring the attendance of a witness at a deposition or hearing may be served in any state, commonwealth, territory, or the District of Columbia. A subpoena may be served by a United States marshal or deputy marshal, or by any other person who is not a party and not less than 18 years of age. Service of a subpoena upon a person named therein shall be made by personally delivering a copy to that person and tendering the fees for one day's attendance and the mileage provided by 28 U.S.C. 1821 or other applicable law. However, where the subpoena is issued on behalf of the Government, payment need not be tendered in advance of attendance.</P>
                        <P>(3) The party at whose instance a subpoena is issued shall be responsible for the payment of fees and mileage of the witness and of the officer who serves the subpoena. The failure to make payment of such charges on demand may be deemed by the Board as a sufficient ground for striking such evidence as the Board deems appropriate.</P>
                        <P>
                            (g) 
                            <E T="03">Contumacy or Refusal to Obey a Subpoena</E>
                            —In case of contumacy or refusal to obey a subpoena by a person who resides, is found, or transacts business within the jurisdiction of a United States District Court, the Board may apply to the Court through the Attorney General of the United States for an order requiring the person to appear before the Board to give testimony or produce evidence or both. Any failure of any such person to obey the order of the Court may be punished by the Court as a contempt thereof.
                        </P>
                        <HD SOURCE="HD1">Rule 23. Ex Parte Communications</HD>
                        <P>No member of the Board or of the Board's staff shall entertain, nor shall any person directly or indirectly involved in an appeal, submit to the Board or the Board's staff, ex parte, any evidence, explanation, analysis, or advice, whether written or oral, regarding any matter at issue in an appeal. This Rule does not apply to consultation among Board members or its staff or to ex parte communications concerning the Board's administrative functions or procedures.</P>
                        <HD SOURCE="HD1">Rule 24. Effective Date</HD>
                        <P>
                            These rules and addendums are applicable to appeals processed under the Contract Disputes Act (CDA), 41 U.S.C. 7101-7109, and other appeals to the extent consistent with law. They apply to all appeals filed on or after the date of final publication in the 
                            <E T="04">Federal Register,</E>
                             and to those appeals filed before that date, unless that application is inequitable or unfair.
                        </P>
                        <HD SOURCE="HD1">ADDENDUM I</HD>
                        <HD SOURCE="HD1">EQUAL ACCESS TO JUSTICE ACT PROCEDURES</HD>
                        <P>
                            (a) 
                            <E T="03">Definitions</E>
                            —
                        </P>
                        <P>For the purpose of these procedures:</P>
                        <P>(1) “Equal Access to Justice Act,” or “EAJA,” means 5 U.S.C. 504, as amended;</P>
                        <P>(2) “Board” means the Armed Services Board of Contract Appeals; and</P>
                        <P>(3) “Contract Disputes Act” means the Contract Disputes Act, 41 U.S.C. 7101-7109 (CDA).</P>
                        <P>
                            (b) 
                            <E T="03">Scope of procedures</E>
                            —These procedures are intended to assist the parties in the processing of EAJA applications for award of fees and other expenses incurred in connection with appeals pursuant to the CDA.
                        </P>
                        <P>
                            (c) 
                            <E T="03">Eligibility of applicants</E>
                            —
                        </P>
                        <P>(1) To be eligible for an EAJA award, an applicant must be a party appellant that has prevailed in a CDA appeal before the Board and must be one of the following:</P>
                        <P>(i) An individual with a net worth which did not exceed $2,000,000 at the time the appeal was filed; or</P>
                        <P>(ii) Any owner of an unincorporated business, or any partnership, corporation, association, unit of local Government, or organization, the net worth of which does not exceed $7,000,000 and which does not have more than 500 employees; except:</P>
                        <P>
                            (A) Certain charitable organizations or cooperative associations; and
                            <PRTPAGE P="769"/>
                        </P>
                        <P>(B) For the purposes of 5 U.S.C. 504(a)(4), a small entity as defined in 5 U.S.C. 601, need not comply with any net worth requirement (see 5 U.S.C. 504(b)(1)(B)).</P>
                        <P>(2) For the purpose of eligibility, the net worth and number of employees of an applicant shall be determined as of the date the underlying CDA appeal was filed with the Board.</P>
                        <P>
                            (d) 
                            <E T="03">Standards of awards</E>
                            —A prevailing eligible applicant shall receive an award of fees and expenses incurred in connection with a CDA appeal, unless the position of the Government over which the applicant prevailed was substantially justified, or if special circumstances make the award unjust.
                        </P>
                        <P>
                            (e) 
                            <E T="03">Allowable fees and other expenses</E>
                            —
                        </P>
                        <P>(1) Fees and other expenses must be reasonable. Awards will be based upon the prevailing market rates, subject to paragraph (e)(2) of this section, for the kind and quality of services furnished by attorneys, agents, and expert witnesses.</P>
                        <P>(2) No award for the fee of an attorney or agent may exceed $125 per hour. No expert witness shall be compensated at a rate in excess of the highest rate of compensation for expert witnesses paid by the agency involved.</P>
                        <P>(3) The reasonable cost of any study, analysis, engineering report, test, or project, prepared on behalf of a party may be awarded, to the extent that the study or other matter was necessary in connection with the appeal and the charge for the service does not exceed the prevailing rate for similar services.</P>
                        <P>
                            (f) 
                            <E T="03">Time for filing of applications</E>
                            —An application may be filed after an appellant has prevailed in the CDA appeal within 30 days after the Board's disposition of the appeal has become final.
                        </P>
                        <P>
                            (g) 
                            <E T="03">Application contents</E>
                            —
                        </P>
                        <P>(1) An EAJA application shall comply with each of the following:</P>
                        <P>(i) Show that the applicant is a prevailing party;</P>
                        <P>(ii) Show that the applicant is eligible to receive an award;</P>
                        <P>(iii) Allege that the position of the government was not substantially justified; and</P>
                        <P>(iv) Show the amount of fees and other expenses sought, including an itemized statement thereof.</P>
                        <P>(2) An original and one copy of the application and exhibits should be filed with the Board. The applicant will forward one copy to the Government.</P>
                        <P>(3) When a compliant application has been timely filed, the Board, in order to obtain more detailed information, may require supplementation of the application.</P>
                        <P>
                            (h) 
                            <E T="03">Net worth exhibit</E>
                            —Each applicant for which a determination of net worth is required under the EAJA should provide with its application a detailed net worth exhibit showing the net worth of the applicant when the CDA appeal was filed. The exhibit may be in any form convenient to the applicant that provides full disclosure of assets, liabilities, and net worth.
                        </P>
                        <P>
                            (i) 
                            <E T="03">Fees and other expenses exhibit</E>
                            —The application should be accompanied by a detailed fees and other expenses exhibit fully documenting the fees and other expenses, including the cost of any study, analysis, engineering report, test, or project, for which an award is sought. The date and a description of all services rendered or costs incurred should be indicated. A separate itemized statement should be submitted for each professional firm or individual whose services are covered by the application showing the hours spent in connection with the CDA appeal by each individual, a description of the particular services performed by specific date, the rate at which each fee has been computed, any expenses for which reimbursement is sought, the total amount claimed, and the total amount paid or payable by the applicant or by any other person or entity for the services provided. The Board may require the applicant to provide vouchers, receipts, or other substantiation for any expenses sought.
                        </P>
                        <P>
                            (j) 
                            <E T="03">Answer to application</E>
                            —
                        </P>
                        <P>(1) Within 30 days after receipt by the Government of an application, the Government may file an answer. Unless the Government requests an extension of time for filing or files a statement of intent to negotiate under paragraph (2) below, failure to file an answer within the 30-day period may be treated by the Board at its discretion as a general denial to the application on behalf of the Government.</P>
                        <P>(2) If the Government and the applicant believe that the matters raised in the application can be resolved by mutual agreement, they may jointly file a statement of intent to negotiate a settlement. Filing of this statement will extend the time for filing an answer for an additional 30 days. Further extensions may be requested by the parties.</P>
                        <P>(3) The answer will explain in detail any objections to the award requested and identify the facts relied upon in support of the Government's position.</P>
                        <P>(4) An original and one copy of the answer should be filed with the Board. The Government will forward one copy to the applicant.</P>
                        <P>
                            (k) 
                            <E T="03">Reply</E>
                            —Within 15 days after receipt of an answer, the applicant may file a reply. An original and one copy of the reply will be filed with the Board. The applicant will forward one copy to the Government.
                        </P>
                        <P>
                            (l) 
                            <E T="03">Award proceedings</E>
                            —
                        </P>
                        <P>
                            (1) The Board may enter an order prescribing the procedure to be followed or take such other action as may be deemed appropriate under the EAJA. Further proceedings will be held only when necessary for full and fair resolution of the issues arising from the application.
                            <PRTPAGE P="770"/>
                        </P>
                        <P>(2) A request that the Board order further proceedings under this paragraph will describe the disputed issues, explain why the additional proceedings are deemed necessary to resolve the issues and specifically identify any information sought and its relationship to the disputed issues.</P>
                        <P>
                            (m) 
                            <E T="03">Evidence</E>
                            —
                        </P>
                        <P>
                            (1) 
                            <E T="03">Decisions on the merits</E>
                            —When a CDA appeal is decided on the merits, other than by a consent judgment, the record relating to whether the Government's position under the EAJA was substantially justified will be limited to the record in the CDA appeal. Evidence relevant to other issues in the award proceeding may be submitted.
                        </P>
                        <P>
                            (2) 
                            <E T="03">Other dispositions</E>
                            —When a CDA appeal is settled, or decided by a consent judgment, either party in proceedings under the EAJA may, for good cause shown, supplement the record established in the CDA appeal with affidavits and other supporting evidence relating to whether the position of the agency was substantially justified or other issues in the award proceeding.
                        </P>
                        <P>
                            (n) 
                            <E T="03">Decision</E>
                            —Decisions under the EAJA will be rendered by the Administrative Judge or a majority of the judges who would have participated in a motion for reconsideration of the underlying CDA appeal. The decision of the Board will include written findings and conclusions and the basis therefor. The Board's decision on an application for fees and other expenses under the EAJA will be the final administrative decision regarding the EAJA application.
                        </P>
                        <P>
                            (o) 
                            <E T="03">Motions for reconsideration</E>
                            —Either party may file a motion for reconsideration. Motions for reconsideration must be filed within 30 days of receipt of the Board's EAJA decision. Extensions in the period to file a motion will not be granted. Extensions to file a memorandum in support of a timely filed motion may be granted.
                        </P>
                        <P>
                            (p) 
                            <E T="03">Payment of Awards</E>
                            —The Board's EAJA awards will be paid directly by the contracting agency over which the applicant prevailed in the underlying CDA appeal.
                        </P>
                        <HD SOURCE="HD1">ADDENDUM II</HD>
                        <HD SOURCE="HD1">Alternative Methods of Dispute Resolution</HD>
                        <P>1. The Contract Disputes Act (CDA), 41 U.S.C. 7105(g)(1), states that boards of contract appeals “shall . . . to the fullest extent practicable provide informal, expeditious, and inexpensive resolution of disputes.” Resolution of a dispute at the earliest stage feasible, by the fastest and least expensive method possible, benefits both parties. To that end, the parties are encouraged to consider Alternative Dispute Resolution (ADR) procedures for pre-claim and pre-final decision matters, as well as appeals pending before the Board. The Board may also conduct ADRs for any Federal agency. However, if the matter is not pending before the Board under its CDA jurisdiction, any settlement may not be paid out of the Judgment Fund.</P>
                        <P>2. The ADR methods described in this Addendum are intended to suggest techniques that have worked in the past. Any appropriate method that brings the parties together in settlement, or partial settlement, of their disputes is a good method. The ADR methods listed are not intended to preclude the parties' use of other ADR techniques that do not require the Board's participation, such as settlement negotiations, fact-finding conferences or procedures, mediation, or minitrials not involving use of the Board's personnel. Any method, or combination of methods, including one that will result in a binding decision, may be selected by the parties without regard to the dollar amount in dispute.</P>
                        <P>3. The parties must jointly request ADR procedures at the Board. The request must be approved by the Board. The Board may also schedule a conference to explore the desirability and selection of an ADR method and related procedures. If an ADR involving the Board's participation is requested and approved by the Board, a Neutral will be appointed. If an Administrative Judge has already been assigned to an appeal, the same judge will normally be assigned to be the Neutral in an ADR. If an Administrative Judge has not yet been assigned to the appeal, or if the subject of the ADR is a matter pending before the contracting officer prior to any appeal, the Board will appoint an Administrative Judge to be the Neutral. In such instances, as well as situations in which the parties prefer that an assigned Administrative Judge not be appointed to serve as the Neutral, the parties may submit a list of at least three preferred Administrative Judges and the Board will endeavor to accommodate their preferences.</P>
                        <P>4. To facilitate full, frank and open discussion and presentations, any Neutral who has participated in a non-binding ADR procedure that has failed to resolve the underlying dispute will be recused from further participation in the matter unless the parties expressly agree otherwise in writing and the Board concurs. Further, the recused Neutral will not discuss the merits of the dispute or substantive matters involved in the ADR proceedings with other Board personnel.</P>
                        <P>
                            5. Written material prepared specifically for use in an ADR proceeding, oral presentations made at an ADR proceeding, and all discussions in connection with such proceedings between the parties and the Neutral are confidential and, unless otherwise specifically agreed by the parties, inadmissible as evidence in any pending or future Board proceeding involving the parties or matter in 
                            <PRTPAGE P="771"/>
                            dispute. However, evidence otherwise admissible before the Board is not rendered inadmissible because of its use in the ADR proceeding.
                        </P>
                        <P>6. The ADR method and the procedures and requirements implementing the ADR method will be prescribed by the written agreement of the parties and approved by the Board. ADR methods can be used successfully at any stage of the litigation.</P>
                        <P>7. The following are examples of ADR methods commonly used at the Board:</P>
                        <P>
                            (a) 
                            <E T="03">Nonbinding</E>
                            —
                        </P>
                        <P>Mediations: A Neutral is an Administrative Judge who will not normally hear or have any formal or informal decision-making authority in the matter and who is appointed for the purpose of facilitating settlement. In many circumstances, settlement can be fostered by a frank, in-depth discussion of the strengths and weaknesses of each party's position with the Neutral. The agenda for meetings with the Neutral will be flexible to accommodate the requirements of the case. To further the settlement effort, the Neutral may meet with the parties either jointly or individually. A Neutral's recommendations are not binding on the parties. When this method is selected, the ADR agreement must contain a provision in which the parties and counsel agree not to subpoena the Neutral in any legal action or administrative proceeding of any kind to produce any notes or documents related to the ADR proceeding or to testify concerning any such notes or documents or concerning his/her thoughts or impressions.</P>
                        <P>
                            (b) 
                            <E T="03">Binding</E>
                            —
                        </P>
                        <P>Summary Proceeding With Binding Decision: A summary proceeding with binding decision is a procedure whereby the resolution of the appeal is expedited and the parties try their appeal informally before an Administrative Judge. A binding “bench” decision may be issued upon conclusion of the proceeding, or a binding summary written decision will be issued by the judge no later than ten days following the later of conclusion of the proceeding or receipt of a transcript. The parties must agree in the ADR agreement that all decisions, rulings, and orders by the Board under this method shall be final, conclusive, not appealable, and may not be set aside, except for fraud. All such decisions, rulings, and orders will have no precedential value. Pre-hearing, hearing, and post-hearing procedures and rules applicable to appeals generally will be modified or eliminated to expedite resolution of the appeal.</P>
                        <P>
                            (c) 
                            <E T="03">Other Agreed Methods</E>
                            —
                        </P>
                        <P>The parties and the Board may agree upon other informal methods, binding or nonbinding that are structured and tailored to suit the requirements of the individual case.</P>
                        <P>8. The above-listed ADR procedures are intended to shorten and simplify the Board's more formalized procedures. Generally, if the parties resolve their dispute by agreement, they benefit in terms of cost and time savings and maintenance or restoration of amicable relations. The Board will not view the parties' participation in ADR proceedings as a sign of weakness. Any method adopted for dispute resolution depends upon both parties having a firm, good faith commitment to resolve their differences. Absent such intention, the best structured dispute resolution procedure is unlikely to be successful.</P>
                        <CITA>[56 FR 36572, July 31, 1991, as amended at 58 FR 37868, July 14, 1993; 65 FR 39707, June 27, 2000; 75 FR 14095, Mar. 24, 2010; 76 FR 27275, May 11, 2011; 76 FR 76321, Dec. 7, 2011; 79 FR 42216, July 21, 2014; 84 FR 48509, Sept. 13, 2019]</CITA>
                    </APPENDIX>
                    <APPENDIX>
                        <RESERVED>Appendixes B-E to Chapter 2 [Reserved]</RESERVED>
                    </APPENDIX>
                    <APPENDIX>
                        <EAR>Ch. 2, App. F</EAR>
                        <HD SOURCE="HED">Appendix F to Chapter 2—Material Inspection and Receiving Report</HD>
                        <FP SOURCE="FP-2">Part 1—Introduction</FP>
                        <FP>Sec.</FP>
                        <FP SOURCE="FP1-2">F-101 General.</FP>
                        <FP SOURCE="FP1-2">F-102 Applicability.</FP>
                        <FP SOURCE="FP1-2">F-103 Use.</FP>
                        <FP SOURCE="FP1-2">F-104 Application.</FP>
                        <FP SOURCE="FP-2">Part 2—Contract Quality Assurance On Shipments Between Contractors</FP>
                        <FP SOURCE="FP1-2">F-201 Procedures.</FP>
                        <FP SOURCE="FP-2">Part 3—Preparation of the Wide Area Workflow Receiving Report (WAWF RR)</FP>
                        <FP SOURCE="FP1-2">F-301 Preparation instructions.</FP>
                        <FP SOURCE="FP1-2">F-302 Mode/method of shipment codes.</FP>
                        <FP SOURCE="FP1-2">F-303 Consolidated shipments.</FP>
                        <FP SOURCE="FP1-2">F-304 Correction instructions.</FP>
                        <FP SOURCE="FP1-2">F-305 Invoice instructions.</FP>
                        <FP SOURCE="FP1-2">F-306 Packing list instructions.</FP>
                        <FP SOURCE="FP1-2">F-307 Receiving instructions.</FP>
                        <FP SOURCE="FP-2">Part 4—Preparation of the DD Form 250 and DD Form 250C</FP>
                        <FP SOURCE="FP1-2">F-401 Preparation instructions.</FP>
                        <FP SOURCE="FP1-2">F-402 Mode/method of shipment codes.</FP>
                        <FP SOURCE="FP1-2">F-403 Consolidated shipments.</FP>
                        <FP SOURCE="FP1-2">F-404 Multiple consignee instructions.</FP>
                        <FP SOURCE="FP1-2">F-405 Correction instructions.</FP>
                        <FP SOURCE="FP1-2">F-406 Invoice instructions.</FP>
                        <FP SOURCE="FP1-2">F-407 Packing list instructions.</FP>
                        <FP SOURCE="FP1-2">F-408 Receiving instructions.</FP>
                        <FP SOURCE="FP-2">Part 5—Distribution of Wide Area Workflow Receiving Report (WAWF RR), DD Form 250 and DD Form 250C</FP>
                        <FP SOURCE="FP1-2">F-501 Distribution of WAWF RR.</FP>
                        <FP SOURCE="FP1-2">F-502 Distribution of DD Form 250 and DD Form 250C.</FP>
                        <FP SOURCE="FP-2">Part 6—Preparation of the DD Form 250-1 (Loading Report)</FP>
                        <FP SOURCE="FP1-2">F-601 Instructions.</FP>
                        <FP SOURCE="FP-2">Part 7—Preparation of the DD Form 250-1 (Discharge Report)</FP>
                        <FP SOURCE="FP1-2">F-701 Instructions.</FP>
                        <FP SOURCE="FP-2">Part 8—Distribution of the DD Form 250-1</FP>
                        <FP SOURCE="FP1-2">
                            F-801 Distribution.F-802 Corrected DD Form 250-1.
                            <PRTPAGE P="772"/>
                        </FP>
                        <FP SOURCE="FP1-2">F-802 Corrected DD Form 250-1.</FP>
                        <AUTH>
                            <HD SOURCE="HED">Authority:</HD>
                            <P>41 U.S.C. 1303 and 48 CFR chapter 1.</P>
                        </AUTH>
                        <PARTHD>Part 1—Introduction</PARTHD>
                        <SECHD>F-101 General.</SECHD>
                        <P>(a) This appendix contains procedures and instructions for the use, preparation, and distribution of the Wide Area WorkFlow (WAWF) Receiving Report (RR), WAWF Reparable Receiving Report (WAWF RRR) , the WAWF Energy RR, and commercial shipping/packing lists used to document Government contract quality assurance. The WAWF RR is the electronic equivalent of the DD Form 250, Material Inspection and Receiving Report (MIRR). The WAWF Energy RR is the electronic equivalent of the DD Form 250 for overland shipments and DD Form 250-1, Tanker/Barge Material Inspection and Receiving Report, for waterborne shipments. The WAWF RRR is the electronic equivalent of the DD Form 250 for repair, maintenance, or overhaul of Government-furnished property.</P>
                        <P>(b) The use of the DD Form 250 series documents is on an exception basis (see DFARS 232.7002(a)) because use of the WAWF RR is now required by most DoD contracts. WAWF provides for electronic preparation and documentation of acceptance of supplies and services, and electronic invoicing. In addition WAWF allows the printing of a RR that can be used as a packing list or when a signed copy is required.</P>
                        <SECHD>F-102 Applicability.</SECHD>
                        <P>(a) DFARS 252.232-7003, Electronic Submission of Payment Requests and Receiving Reports, requires payment requests and receiving reports using WAWF in nearly all cases.</P>
                        <P>(b) When DoD provides quality assurance or acceptance services for non-DoD activities, prepare a MIRR using the instructions in this appendix, unless otherwise specified in the contract.</P>
                        <SECHD>F-103 Use.</SECHD>
                        <P>(a) The WAWF RR, WAWF RRR and the DD Form 250 are multipurpose reports used—</P>
                        <P>(1) To provide evidence of Government contract quality assurance at origin or destination;</P>
                        <P>(2) To provide evidence of acceptance at origin, destination, or other;</P>
                        <P>(3) For packing lists;</P>
                        <P>(4) For receiving;</P>
                        <P>(5) For shipping;</P>
                        <P>(6) As a contractor invoice (the WAWF RR, WAWF RRR or DD Form 250 alone cannot be used as an invoice, however the option exists to create an invoice from the Receiving Report or a Combo (Invoice and Receiving Report) both of which minimize data entry); and</P>
                        <P>(7) As commercial invoice support.</P>
                        <P>(b) Do not use the WAWF RR, WAWF RRR or the DD Form 250 for shipments—</P>
                        <P>(1) By subcontractors, unless the subcontractor is shipping directly to the Government; or</P>
                        <P>
                            (2) Of contract inventory. The WAWF Property Transfer document should be used for this type of shipment. Training for the preparation of this document type is available at 
                            <E T="03">https://wawftraining.eb.mil</E>
                            , under the Property Transfer and Receipt section.
                        </P>
                        <P>(c) The contractor prepares the WAWF RR, WAWF RRR or the DD Form 250, except for entries that an authorized Government representative is required to complete. When using a paper DD Form 250, the contractor shall furnish sufficient copies of the completed form, as directed by the Government representative.</P>
                        <P>(d) Use the WAWF Energy RR or the DD Form 250-1:</P>
                        <P>(1) For bulk movements of petroleum products by tanker or barge to cover—</P>
                        <P>(i) Origin or destination acceptance of cargo; or</P>
                        <P>(ii) Shipment or receipt of Government owned products.</P>
                        <P>(2) To send quality data to the point of acceptance in the case of origin inspection on FOB destination deliveries or preinspection at product source. Annotate the forms with the words “INSPECTED FOR QUALITY ONLY.”</P>
                        <P>(e) In addition to the above uses, the WAWF RR and WAWF RRR provide additional functionality, not provided by the paper DD Form 250 that complies with the following requirements:</P>
                        <P>(1) Item Unique Identification (IUID), when the clause at DFARS 252.211-7003, Item Unique Identification and Valuation is used in the contract, reporting of IUID data is required. WAWF captures the IUID data and forwards the data to the IUID registry after acceptance. WAWF shall be used to report Unique Item Identifiers (UIIs) at the line item level, unless an exception to WAWF applies, and can also be used to report UIIs embedded at the line item level.</P>
                        <P>(2) Radio Frequency Identification (RFID), when the clause at DFARS 252.211-7006, Radio Frequency Identification, is used in the contract, WAWF will capture the RFID information and forward the data to the receiving location. Using WAWF is the only way a contractor can comply with the clause to furnish RFID data via an Advance Shipping Notice (ASN). The RFID information may be added at time of submission, or via the WAWF Pack Later functionality after acceptance.</P>
                        <P>
                            (3) Reporting of Government-furnished property, when the clause at DFARS 252.211-7007, Reporting of Government-Furnished Property, is used in the contract, use of the WAWF RRR will capture the shipment of Government-furnished property items after 
                            <PRTPAGE P="773"/>
                            acceptance of repair services and forward the data to the IUID registry. WAWF is the only way a contractor can report the transfer of Government-furnished property items in the IUID registry.
                        </P>
                        <SECHD>F-104 Application.</SECHD>
                        <P>
                            (a) 
                            <E T="03">WAWF RR and DD Form 250.</E>
                             (1) Use the WAWF RR or DD Form 250 for delivery of contract line, subline, exhibit line, or exhibit subline items. Do not use the WAWF RR or DD Form 250 for those exhibit line or exhibit subline items on a DD Form 1423, Contract Data Requirements List, which indicate no DD Form 250 is required.
                        </P>
                        <P>(2) If the shipped to, marked for, shipped from, mode of shipment, contract quality assurance and acceptance data are the same for more than one shipment made on the same day under the same contract, contractors may prepare one WAWF RR or DD Form 250 to cover all such shipments.</P>
                        <P>(3) If the volume of the shipment precludes the use of a single car, truck, or other vehicle, prepare a separate WAWF RR or DD Form 250 for the contents of each vehicle.</P>
                        <P>(4) When a shipment is consigned to an Air Force activity and the shipment includes items of more than one Federal supply class (FSC) or material management code (MMC), prepare a separate WAWF RR or DD Form 250 for items of each of the FSCs or MMCs in the shipment. However, the cognizant Government representative may authorize a single WAWF RR or DD Form 250, listing each of the FSCs or MMCs included in the shipment on a separate continuation sheet. The MMC appears as a suffix to the national stock number applicable to the item.</P>
                        <P>
                            (5) 
                            <E T="03">Consolidation of Petroleum Shipments on a Single WAWF RR or DD Form 250.</E>
                        </P>
                        <P>
                            (i) 
                            <E T="03">Contiguous United States.</E>
                             Contractors may consolidate multiple car or truck load shipments of petroleum made on the same day, to the same destination, against the same contract line item, on one WAWF RR or DD Form 250. To permit verification of motor deliveries, assign each load a load number which can be identified to the shipment number in Block 2 of the DD Form 250. Include a shipping document (commercial or Government) with each individual load showing as a minimum—
                        </P>
                        <P>(A) The shipper;</P>
                        <P>(B) Shipping point;</P>
                        <P>(C) Consignee;</P>
                        <P>(D) Contract and line item number;</P>
                        <P>(E) Product identification;</P>
                        <P>(F) Gross gallons (bulk only);</P>
                        <P>(G) Loading temperature (bulk only);</P>
                        <P>(H) American Petroleum Institute gravity (bulk only);</P>
                        <P>(I) Identification of carrier's equipment;</P>
                        <P>(J) Serial number of all seals applied; and</P>
                        <P>(K) Signature of supplier's representative.</P>
                        <FP>When acceptance is at destination, the receiving activity retains the shipping document(s) to verify the entries on the consignee copy of the DD Form 250 forwarded by the contractor (reference F-401, Table 1) before signing Block 21b.</FP>
                        <P>
                            (ii) 
                            <E T="03">Overseas.</E>
                             The same criteria as for contiguous United States applies, except the consolidation period may be extended, if acceptable to the receiving activity, shipping activity, Government finance office, and the authorized Government representative having cognizance at the contractor's facility. In addition, the contractor may include more than one contract line item in each WAWF RR or DD Form 250 if the shipped to, marked for, shipped from, mode of shipment, contract quality assurance, and acceptance data are the same for all line items.
                        </P>
                        <P>
                            (6) 
                            <E T="03">Consolidation of Coal Shipments on a Single WAWF RR or DD 250.</E>
                             Contractors may consolidate multiple railcar or truck shipments of coal made on the same day, to the same destination, against the same contract line items, on one WAWF RR or DD 250. To permit verification of truck deliveries, assign each load a load number which can be identified to the shipment number in Block 2 of the DD Form 250 and the analytical test report. Include a commercial shipping document with each individual truck load showing as a minimum—
                        </P>
                        <P>(i) The shipper;</P>
                        <P>(ii) The name or names;</P>
                        <P>(iii) Location and shipping point of the mine or mines from which the coal originates;</P>
                        <P>(iv) The contract number;</P>
                        <P>(v) The exact size of the coal shipped; and</P>
                        <P>(vi) A certified weighmaster's certification of weight for the truckload.</P>
                        <P>Include a waybill with each rail shipment showing the identical information. To permit verification of rail deliveries, identify each railcar number comprising the shipment to the shipment number in Block 2 of the DD Form 250 and the analytical test report. When acceptance is at destination, the receiving activity must retain the shipping document(s) to verify the entries on the consignee copy of the DD Form 250.</P>
                        <P>
                            (b) 
                            <E T="03">WAWF RRR or DD Form 250.</E>
                             Use as in paragraph (a) of this section for delivery of services for repair, overhaul, or maintenance.
                        </P>
                        <P>
                            (c) 
                            <E T="03">WAWF Energy RR or the DD Form 250-1.</E>
                             (1) Use a separate form for each tanker or barge cargo loaded.
                        </P>
                        <P>(2) The contractor may report more than one barge in the same tow on a single form if on the same contract and consigned to the same destination.</P>
                        <P>(3) When liftings involve more than one contract, prepare separate forms to cover the portion of cargo loaded on each contract.</P>
                        <P>
                            (4) Prepare a separate form for each product or grade of product loaded.
                            <PRTPAGE P="774"/>
                        </P>
                        <P>(5) Use a separate document for each tanker or barge cargo and each grade of product discharged.</P>
                        <P>(6) For discharge, the contractor may report more than one barge in the same tow on a single form if from the same loading source.</P>
                        <PARTHD>Part 2—Contract Quality Assurance on Shipments Between Contractors</PARTHD>
                        <SECHD>F-201 Procedures</SECHD>
                        <P>Follow the procedures at PGI F-201 for evidence of required Government contract quality assurance at a subcontractor's facility.</P>
                        <PARTHD>Part 3—Preparation of the Wide Area Workflow (WAWF) Receiving Report (WAWF RRR), and WAWF Energy RR</PARTHD>
                        <SECHD>F-301 Preparation instructions.</SECHD>
                        <P>
                            (a) 
                            <E T="03">General.</E>
                             (1) Preparation instructions and training for the WAWF RR are available at 
                            <E T="03">https://wawftraining.eb.mil.</E>
                             The instructions on preparing a WAWF RR are part of the Vendor Training section.
                        </P>
                        <P>(2) Prime contractors can direct subcontractors to prepare and submit documents in WAWF by giving their subcontractors access to WAWF via the creation of a Commercial and Government Entity (CAGE) extension to the prime CAGE.</P>
                        <P>(3) If the contract is in Electronic Data Access (EDA) (DoD's contract repository), then the WAWF system will automatically populate all available and applicable contract data.</P>
                        <P>(i) When source acceptance is required, WAWF will populate the “Inspect By” with the “Admin by” Department of Defense Activity Address Code (DoDAAC). The vendor shall change the DoDAAC if Government Source Inspection (GSI) is performed at other than the “Admin By.”</P>
                        <P>(ii) Any fields that have been pre-filled may be changed.</P>
                        <P>(iii) WAWF will also verify that CAGE codes are valid and active in the System for Award Management (SAM), and that DoDAACs and Military Assistance Program Address Codes (MAPACs) are valid in Defense Automatic Addressing System (DAAS).</P>
                        <P>(4) WAWF will populate the address information for CAGE codes, DODAACs, and MAPACs from SAM and DAAS. These sites are the DoD definitive sources for address information. Any fields that have been pre-filled may be changed or additional information added.</P>
                        <P>(5) Do not include classified information in WAWF.</P>
                        <P>
                            (b) 
                            <E T="03">Completion instructions.</E>
                            (1) Contract no/delivery order no.
                        </P>
                        <P>(i) For stand-alone contracts, enter the 13-position alpha-numeric basic Procurement Instrument Identifier (PIID) of the contract. For task and delivery orders numbered in accordance with FAR 4.1603 and DFARS 204.1603, enter the 13-character order number. The contract or agreement number under which the order was placed may be omitted from the WAWF RR. Alternatively, the contractor may choose to enter the contract number on the WAWF RR in addition to the 13-character order number. If the order has only a four-position alpha-numeric call or order serial number, enter both the 13-position basic contract PIID and the four-position order number.</P>
                        <P>(ii) Except as indicated in paragraph (b)(1)(iii) of this appendix, do not enter supplementary numbers used in conjunction with basic PIIDs to identify—</P>
                        <P>(A) Modifications of contracts and agreements;</P>
                        <P>(B) Modifications to calls or orders; or</P>
                        <P>(C) Document numbers representing contracts written between contractors.</P>
                        <P>(iii) When shipping instructions are furnished and shipment is made before receipt of the confirming contract modification (SF 30, Amendment of Solicitation/Modification of Contract), enter a comment in the Misc. Info Tab to this effect. This will appear in the Comments section of the printed WAWF RR.</P>
                        <P>(2) Shipment No.</P>
                        <P>
                            (i) The shipment number format requires first three data positions to be alpha, fourth position alpha-numeric and last three positions numeric, 
                            <E T="03">e.g.,</E>
                             DFAR001 or DAR0001. Any document used as a packing list must include the shipment number information.
                        </P>
                        <P>(A) The prime contractor shall control and assign the shipment number prefix. The shipment number shall consist of three alphabetic characters for each “Shipped From” address. The shipment number prefix shall be different for each “Shipped From” address and shall remain constant throughout the life of the contract. The prime contractor may assign separate prefixes when shipments are made from different locations within a facility identified by one “Shipped From” address.</P>
                        <P>(B) Number the first shipment 0001 for shipments made under the contract or contract and order number from each “Shipped From” address, or shipping location within the “Shipped From” address. Consecutively number all subsequent shipments with the identical shipment number prefix. While shipments should be created sequentially they can be released and accepted out of sequence.</P>
                        <P>
                            (
                            <E T="03">1</E>
                            ) Use alpha-numeric serial numbers when more than 9,999 numbers are required. Serially assign alpha-numeric numbers with the alpha in the first position (the letters I and O shall not be used) followed by the three-position numeric serial number. Use the following alpha-numeric sequence:
                        </P>
                        <FP SOURCE="FP-1">A000 through A999 (10,000 through 10,999)</FP>
                        <FP SOURCE="FP-1">
                            B000 through B999 (11,000 through 11,999)
                            <PRTPAGE P="775"/>
                        </FP>
                        <FP SOURCE="FP-1">Z000 through Z999 (34,000 through 34,999)</FP>
                        <P>
                            (
                            <E T="03">2</E>
                            ) When this series is completely used, the shipment number prefix will have to be changed when the series is completely used. WAWF will not allow duplicate shipment numbers to be created against a contract or contract and delivery order.
                        </P>
                        <P>(ii) Reassign the shipment number of the initial shipment where a “Replacement Shipment” is involved (see paragraph (b)(16)(iv)(F) of this appendix).</P>
                        <P>(iii) The prime contractor shall control deliveries and on the final shipment of the contract shall end the shipment number with a “Z.” Where the final shipment is from other than the prime contractor's plant, the prime contractor may elect either to—</P>
                        <P>(A) Direct the subcontractor making the final shipment to end that shipment number with a “Z”; or</P>
                        <P>(B) Upon determination that all subcontractors have completed their shipments, to correct the DD Form 250 (see F-304) covering the final shipment made from the prime contractor's plant by addition of a “Z” to that shipment number.</P>
                        <P>(iv) Contractors follow the procedures in F-305 to use commercial invoices.</P>
                        <P>(3) Date shipped. Enter the date the shipment is released to the carrier or the date the services are completed. If the shipment will be released after the date of contract quality assurance and/or acceptance, enter the estimated date of release. When the date is estimated, enter an “E” or select an “E” from the drop down menu in the “Estimated” block after the date. Do not delay submission of the WAWF RR for lack of entry of the actual shipping date. Correction of the WAWF RR is not required to show the actual shipping date (see F-303). Once the document is submitted the shipment date cannot be changed.</P>
                        <P>(4) B/L TCN. When applicable, enter—</P>
                        <P>(i) The commercial or Government bill of lading number after “B/L;” WAWF provides the capability to separately and correctly identify the Government Bill of Lading (GBL) from a Commercial Bill of Lading (CBL). An authorized user will select whether the entered bill of lading number is either a GBL number or a CBL number.</P>
                        <P>(ii) The transportation control number must be a 17 alpha/numeric digit min/max field, and WAWF provides the capability to enter two secondary transportation tracking numbers.</P>
                        <P>(5) Line haul mode. Select the Line Haul Mode of Shipment code from a drop down menu in WAWF.</P>
                        <P>(6) Inspection and acceptance point. Enter an “S” for Origin or “D” for Destination. In addition to “S” and “D,” WAWF allows acceptance at Other (O). For purposes of conforming to contract, “O” is equivalent to “D”. In WAWF, destination acceptance is performed by the “Ship to” DODAAC organization and “Other” permits the acceptance of destination documents at a location other than the “Ship to.” The goods or services will be shipped to one location and the paperwork will be routed to another location for the actual acceptance.</P>
                        <P>(7) Prime contractor/code. Enter the prime CAGE code to which the contract was awarded.</P>
                        <P>(8) Administered by/code. Enter the DoDAAC code of the contract administration office cited in the contract.</P>
                        <P>(9) Shipped from/code.</P>
                        <P>(i) Enter the CAGE or DoDAAC code of the “Shipped From” location. If it is the same as the CAGE code leave blank.</P>
                        <P>(ii) For performance of services line items which do not require delivery of items upon completion of services, enter the code of the location at which the services were performed. As mentioned in (i) above, if identical to the prime CAGE code leave blank.</P>
                        <P>(10) FOB. Enter an “S” for Origin or “D” for Destination as specified in the contract. Enter an alphabetic “O” if the “FOB” point cited in the contract is other than origin or destination.</P>
                        <P>(11) Payment will be made by/code. Enter the DoDAAC code of the payment office cited in the contract.</P>
                        <P>(12) Shipped to/code. Enter the DoDAAC, MAPAC, or CAGE code from the contract or shipping instructions.</P>
                        <P>(13) Marked for/code. Enter the code from the contract or shipping instructions. Only valid DoDAACs, MAPACs, or CAGE codes can be entered. Vendors should use the WAWF “Mark for Rep” and “Mark for Secondary” fields for textual marking information specified in the contract. Enter the three-character project code when provided in the contract or shipping instructions.</P>
                        <P>(14) Item No. Enter the item number used in the contract. Use a valid 4 or 6 character line item number under the Uniform Contract Line Item Numbering System (see 204.71). Line item numbers with 6 characters with numbers in the final two positions are not deliverable or billable.</P>
                        <P>(15) Stock/part number/description.</P>
                        <P>(i) Enter the following for each line item:</P>
                        <P>
                            (A) The national stock number (NSN) or noncatalog number. If the contract contains NSNs as well as other identification (
                            <E T="03">e.g.,</E>
                             part numbers) the contractor should place the NSN information in the Stock Part Number field and the remaining numbers in the line item description field. The data entered in the NSN field must reflect the NSN of the material item being shipped and should be a valid NSN, 13 positions in length. In the “Type” drop-down field, select the corresponding type for the data entered. If no National Stock Number (NSN) or other valid “Type” is available, the word “NONE” may be entered for the Stock/Part Number, with a corresponding “Type” of any value 
                            <PRTPAGE P="776"/>
                            other than NSN selected from the drop-down box.
                        </P>
                        <P>(B) In the description field, if required by the contract for control purposes, enter: The make, model, serial number, lot, batch, hazard indicator, or similar description.</P>
                        <P>(C) The Military Standard Requisitioning and Issue Procedures (MILSTRIP) must be placed on the MILSTRIP Tab, not in the line item description field. Enter the MILSTRIP data for each CLIN when MILSTRIP data is identified in the contract.</P>
                        <P>(ii) For service line items, select SV for “SERVICE” in the type field followed by as short a description as is possible in the description field. Some examples of service line items are maintenance, repair, alteration, rehabilitation, engineering, research, development, training, and testing.</P>
                        <P>(A) For WAWF RRRs, the “Ship To” code is the DoDAAC, MAPAC, or CAGE code from the contract or shipping instructions.</P>
                        <P>(B) For service line items not using a WAWF RRR, the “Ship To” code and the “Unit” shall be filled out. The “Ship To” code is the destination Service Acceptor Code for WAWF. If source inspected and accepted, enter the service performance location as the “Ship To” code.</P>
                        <P>(iii) For all contracts administered by the Defense Contract Management Agency, with the exception of fast pay procedures, enter the gross weight of the shipment.</P>
                        <P>(iv) In the description field enter the following as appropriate (entries may be extended through Block 20).</P>
                        <P>(A) Enter in capital letters any special handling instructions/limits for material environmental control, such as temperature, humidity, aging, freezing, shock, etc.</P>
                        <P>
                            (B) When a shipment is chargeable to Navy appropriation 17X4911, enter the appropriation, bureau control number (BCN), and authorization accounting activity (AAA) number (
                            <E T="03">e.g.,</E>
                             17X4911-14003-104).
                        </P>
                        <P>(C) When the Navy transaction type code (TC), “2T” or “7T” is included in the appropriation data, enter “TC 2T” or “TC 7T.”</P>
                        <P>(D) When an NSN is required by but not cited in a contract and has not been furnished by the Government, the contractor may make shipment without the NSN at the direction of the contracting officer. Enter the authority for such shipment.</P>
                        <P>(E) When Government furnished property (GFP) is included with or incorporated into the line item, enter the letters “GFP.”</P>
                        <P>
                            (F) On shipments of Government furnished aeronautical equipment (GFAE) under Air Force contracts, enter the assignment AERNO control number, 
                            <E T="03">e.g.,</E>
                             “AERNO 60-6354.”
                        </P>
                        <P>(G) For items shipped with missing components, enter and complete the following:</P>
                        <FP>“Item(s) shipped short of the following component(s): NSN or comparable identification ________, Quantity ________, Estimated Value ________, Authority ________”</FP>
                        <P>(H) When shipment is made of components which were short on a prior shipment, enter and complete the following:</P>
                        <P>“These components were listed as shortages on shipment number ________, date shipped ________”</P>
                        <P>(I) When shipments involve drums, cylinders, reels, containers, skids, etc., designated as returnable under contract provisions, enter and complete the following:</P>
                        <P>“Return to ________, Quantity ________, Item ________, Ownership (Government/contractor).”</P>
                        <P>(J) Enter the total number of shipping containers, the type of containers, and the container number(s) assigned for the shipment.</P>
                        <P>(K) On foreign military sales (FMS) shipments, enter the special markings, and FMS case identifier from the contract. Also enter the gross weight.</P>
                        <P>(L) When test/evaluation results are a condition of acceptance and are not available prior to shipment, the following note shall be entered if the shipment is approved by the contracting officer:</P>
                        <P>“Note: Acceptance and payment are contingent upon receipt of approved test/evaluation results.”</P>
                        <P>The contracting officer will advise—</P>
                        <P>
                            (
                            <E T="03">1</E>
                            ) The consignee of the results (approval/disapproval); and
                        </P>
                        <P>
                            (
                            <E T="03">2</E>
                            ) The contractor to withhold invoicing pending attachment of the approved test/evaluation results.
                        </P>
                        <P>(M) For clothing and textile contracts containing a bailment clause, enter the words “GFP UNIT VALUE.”</P>
                        <P>(N) When the initial unit incorporating an approved value engineering change proposal (VECP) is shipped, enter the following statement:</P>
                        <FP>This is the initial unit delivered which incorporates VECP No. ________, Contract Modification No. ________, dated ________</FP>
                        <P>(16) Quantity shipped/received.</P>
                        <P>(i) Enter the quantity shipped, using the unit of measure in the contract for payment. When a second unit of measure is used for purposes other than payment, enter the appropriate quantity in the description field.</P>
                        <P>(ii) On the final shipment of a line item of a contract containing a clause permitting a variation of quantity and an underrun condition exists, the prime contractor shall choose the Ship Advice Code “Z”. Where the final shipment is from other than the prime contractor's plant and an underrun condition exists, the prime contractor may elect to direct the subcontractor making the final shipment to choose the Ship Advice Code “Z”;</P>
                        <P>
                            (iii) When the Government is performing destination acceptance the acceptor should enter actual quantity received in apparent 
                            <PRTPAGE P="777"/>
                            good condition in the “Qty. Accepted” field of the Acceptor Line Item Tab.
                        </P>
                        <P>(17) Unit of measure. Enter the abbreviation of the unit measure as indicated in the contract for payment. Where a second unit of measure is indicated in the contract for purposes other than payment or used for shipping purposes, enter the second unit of measure in the description field. Authorized abbreviations are listed in MIL-STD-129, Marking for Shipping and Storage and in the WAWF Unit of Measure Table Link. For example, LB for pound, SH for sheet.</P>
                        <P>(18) Unit price. When using the WAWF RRR, the unit price is the price of the repair, overhaul, or maintenance service from the contract.</P>
                        <P>(i) The contractor may, at its option, enter unit prices on the WAWF RR, except when the contract has IUID requirements and the receiving report is being processed in WAWF, the unit price must represent the acquisition cost that will be recorded in the IUID registry. Therefore, in such cases, the unit price is required. See DFARS 252.211-7003, Item Unique Identification and Valuation).</P>
                        <P>(ii) The contractor shall enter unit prices for each item of property fabricated or acquired for the Government and delivered to a contractor as Government furnished property (GFP). Get the unit price from Section B of the contract. If the unit price is not available, use an estimate. The estimated price should be the contractor's estimate of what the items cost the Government. When the price is estimated, enter “Estimated Unit Price” in the description field. When delivering GFP via WAWF to another contractor, WAWF will initiate a property transfer if the vendor who is initiating the WAWF RR is also registered as a vendor property shipper in WAWF and the vendor receiving the property is also a vendor property receiver in WAWF.</P>
                        <P>(iii) For clothing and textile contracts containing a bailment clause, enter the cited Government furnished property unit value as “GFP UNIT VALUE” in the description field.</P>
                        <P>(iv) For all copies of DD Forms 250 for FMS shipments, enter actual prices, if available. If actual prices are not available, use estimated prices. When the price is estimated, enter an “E” after the price.</P>
                        <P>(19) Amount. WAWF will calculate and populate the amount by multiplying the unit price times the quantity.</P>
                        <P>(20) Contract Quality Assurance (CQA).</P>
                        <P>(i) The words “conform to contract” contained in the text above the signature block in the WAWF RR Header Tab relate to quality and to the quantity of the items on the report. Enter notes taking exception in Misc. Info Tab comment field or on attached supporting documents with an appropriate block cross-reference.</P>
                        <P>(ii) When a shipment is authorized under an alternative release procedure, contractors will execute the alternative release procedure in WAWF by including the appropriate indicator in the electronic transaction rather than through inclusion or attachment of the text of the certificate. The alternative release procedure only provides for release of shipment; Government acceptance must still be indicated by a Government official's signature on the WAWF RR.</P>
                        <P>(iii) When contract terms provide for use of Certificate of Conformance and shipment is made under these terms, contractors will execute Certificates in WAWF by including the appropriate indicator in the electronic transaction rather than through inclusion or attachment of the text of the certificate. Government acceptance must still be indicated by a Government official's signature on the WAWF RR.</P>
                        <P>(iv) Origin.</P>
                        <P>(A) The authorized Government representative must:—</P>
                        <P>
                            (
                            <E T="03">1</E>
                            ) Place an “X” in the appropriate CQA and/or acceptance box(es) to show origin CQA and/or acceptance; and
                        </P>
                        <P>
                            (
                            <E T="03">2</E>
                            ) Sign and date.
                        </P>
                        <P>WAWF will enter the typed, stamped, or printed name, title, email address, and commercial telephone number.</P>
                        <P>(B) When fast pay procedures apply, the contractor or subcontractor shall select “FAST PAY” when creating the WAWF RR. When CQA is required, the authorized Government representative shall execute the block as required by paragraph (A).</P>
                        <P>(v) Destination. When CQA and acceptance or acceptance is at destination, the authorized Government representative must—</P>
                        <P>(A) Place an “X” in the appropriate box(es); and</P>
                        <P>(B) Sign and date.</P>
                        <P>WAWF will enter the typed, stamped, or printed name, title, email address, and commercial telephone number.</P>
                        <P>(21) Contractor use only. MISC. INFO. Self explanatory.</P>
                        <SECHD>F-302 Mode/method of shipment codes.</SECHD>
                        <GPOTABLE COLS="2" OPTS="L2" CDEF="xls20,r100">
                            <BOXHD>
                                <CHED H="1">Code</CHED>
                                <CHED H="1">Description</CHED>
                            </BOXHD>
                            <ROW>
                                <ENT I="01">A</ENT>
                                <ENT>Motor, truckload.</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">B</ENT>
                                <ENT>Motor, less than truckload.</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">C</ENT>
                                <ENT>Van (unpacked, uncrated personal or Government property).</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">D</ENT>
                                <ENT>Driveaway, truckaway, towaway.</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">E</ENT>
                                <ENT>Bus.</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">F</ENT>
                                <ENT>Air Mobility Command (Channel and Special Assignment Airlift Mission).</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">G</ENT>
                                <ENT>Surface parcel post.</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">H</ENT>
                                <ENT>Air parcel post.</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">I</ENT>
                                <ENT>Government trucks, for shipment outside local delivery area.</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">J</ENT>
                                <ENT>Air, small package carrier.</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">K</ENT>
                                <ENT>
                                    Rail, carload.
                                    <SU>1</SU>
                                </ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">L</ENT>
                                <ENT>
                                    Rail, less than carload.
                                    <SU>1</SU>
                                </ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">M</ENT>
                                <ENT>Surface, freight forwarder.</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">N</ENT>
                                <ENT>LOGAIR.</ENT>
                            </ROW>
                            <ROW>
                                <PRTPAGE P="778"/>
                                <ENT I="01">O</ENT>
                                <ENT>Organic military air (including aircraft of foreign governments).</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">P</ENT>
                                <ENT>Through Government Bill of Lading (TGBL).</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">Q</ENT>
                                <ENT>Commercial air freight (includes regular and expedited service provided by major airlines; charters and air taxis).</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">R</ENT>
                                <ENT>European Distribution System or Pacific Distribution System.</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">S</ENT>
                                <ENT>Scheduled Truck Service (STS) (applies to contract carriage, guaranteed traffic routings and/or scheduled service).</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">T</ENT>
                                <ENT>Air freight forwarder.</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">U</ENT>
                                <ENT>QUICKTRANS.</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">V</ENT>
                                <ENT>SEAVAN.</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">W</ENT>
                                <ENT>Water, river, lake, coastal (commercial).</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">X</ENT>
                                <ENT>Bearer, walk-thru (customer pickup of material).</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">Y</ENT>
                                <ENT>Military Intratheater Airlift Service.</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">Z</ENT>
                                <ENT>Military Sealift Command (MSC) (controlled contract or arranged space).</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">2</ENT>
                                <ENT>Government watercraft, barge, lighter.</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">3</ENT>
                                <ENT>Roll-on Roll-off (RORO) service.</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">4</ENT>
                                <ENT>Armed Forces Courier Service (ARFCOS).</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">5</ENT>
                                <ENT>Surface, small package carrier.</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">6</ENT>
                                <ENT>Military official mail (MOM).</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">7</ENT>
                                <ENT>Express mail.</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">8</ENT>
                                <ENT>Pipeline.</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">9</ENT>
                                <ENT>Local delivery by Government or commercial truck (includes on base transfers; deliveries between air, water, or motor terminals; and adjacent activities). Local delivery areas are identified in commercial carriers' tariffs which are filed and approved by regulatory authorities.</ENT>
                            </ROW>
                            <TNOTE>
                                <SU>1</SU>
                                 Includes trailer/container-on-flat-car (excluding SEAVAN).
                            </TNOTE>
                        </GPOTABLE>
                        <SECHD>F-303 Consolidated shipments.</SECHD>
                        <P>When individual shipments are held at the contractor's plant for authorized transportation consolidation to a single bill of lading, the contractor may prepare the WAWF RR or WAWF RRR at the time of CQA or acceptance prior to the time of actual shipment.</P>
                        <SECHD>F-304 Correction instructions.</SECHD>
                        <P>
                            Functionality for correcting a WAWF RR or WAWF RRR is available for Defense Contract Management Agency administered contracts paid using the Mechanization of Contract Administration Services system with source acceptance. Preparation instructions and training for corrections is available at 
                            <E T="03">https://wawftraining.eb.mil.</E>
                             The instructions are part of the Vendor Training section.
                        </P>
                        <SECHD>F-305 Invoice Instructions</SECHD>
                        <P>Contractors shall submit payment requests and receiving reports in accordance with paragraph (b) of the clause at DFARS 252.232-7003 unless one of the exceptions in paragraph (d) of that clause applies.</P>
                        <SECHD>F-306 Packing List Instructions</SECHD>
                        <P>(a) Contractors may use a WAWF processed RR or the WAWF RRR, as a packing list. WAWF provides an option to print the RR or RRR. Contractors can print a RR or RRR from a system other than WAWF if a signed copy is required. In such cases, the contractor shall print the WAWF RR or RRR only after a signature is applied by the Government inspector or authorized acceptor in WAWF. Copies printed from the contractor's system shall be annotated with “\\original signed in WAWF\\” in lieu of the inspector or acceptor's signature. Ensure a copy is visible on the outside and one is placed inside the package.</P>
                        <P>(b) If the contract requires Government source inspection and acceptance at origin, the contractor shall ensure that its packaging documentation includes a RR or RRR that documents inspection, acceptance, or both by the Government inspector or authorized acceptor. A paper DD Form 250 may be used in lieu of WAWF generated RRs or RRRs when one of the exceptions in paragraph (d) of the clause at DFARS 252.232-7003 applies.</P>
                        <SECHD>F-307 Receiving instructions.</SECHD>
                        <P>If CQA and acceptance or acceptance of supplies is required upon arrival at destination, see F-301(b)(20)(v) for instructions.</P>
                        <PARTHD>Part 4—Preparation of the DD Form 250 and DD Form 250C</PARTHD>
                        <SECHD>F-401 Preparation instructions.</SECHD>
                        <P>
                            (a) 
                            <E T="03">General.</E>
                             (1) Dates must use nine spaces consisting of the four digits of the year, three-position alphabetic month abbreviation, and two digits for the day. For example, 2000AUG07, 2000SEP24.
                        </P>
                        <P>(2) Addresses must consist of the name, street address/P.O. box, city, state, and ZIP code.</P>
                        <P>(3) Enter to the right of and on the same line as the word “Code” in Blocks 9 through 12 and in Block 14—</P>
                        <P>(i) The Commercial and Government Entity Handbook (H4/H8) code;</P>
                        <P>(ii) The DoD activity address code (DoDAAC) as it appears in the DoD Activity Address Directory (DoDAAD), DoD 4000.25-6-M; or</P>
                        <P>(iii) The Military Assistance Program Address Directory (MAPAD) code.</P>
                        <P>(4) Enter the DoDAAC, CAGE (H4/H8), or MAPAD code in Block 13.</P>
                        <P>(5) The data entered in the blocks at the top of the DD Form 250c must be identical to the comparable entries in Blocks 1, 2, 3, and 6 of the DD Form 250.</P>
                        <P>(6) Enter overflow data from the DD Form 250 in Block 16 or in the body of the DD Form 250c with an appropriate cross-reference. Do not number or distribute additional DD Form 250c sheets, solely for continuation of Block 23 data as part of the MIRR.</P>
                        <P>(7) Do not include classified information in the MIRR. MIRRs must not be classified.</P>
                        <P>
                            (b) 
                            <E T="03">Completion instructions.</E>
                             (1) Block 1—Procurement instrument identification (Contract) NO. See paragraph F-301(b)(1).
                        </P>
                        <P>
                            (2) Block 2—Shipment no. See F-301(b)(2), Shipment no. When the series is completely 
                            <PRTPAGE P="779"/>
                            used, change the shipment number prefix and start with 0001.
                        </P>
                        <P>(3) Block 3—Date shipped. Enter the date the shipment is released to the carrier or the date the services are completed. If the shipment will be released after the date of CQA and/or acceptance, enter the estimated date of release. When the date is estimated, enter an “E” after the date. Do not delay distribution of the MIRR for entry of the actual shipping date. Reissuance of the MIRR is not required to show the actual shipping date (see F-403).</P>
                        <P>(4) Block 4—B/L TCN. When applicable, enter—</P>
                        <P>(i) The commercial or Government bill of lading number after “B/L;”</P>
                        <P>(ii) The transportation control number after “TCN” (when a TCN is assigned for each line item on the DD Form 250 under Block 16 instructions, insert “See Block 16”); and</P>
                        <P>(iii) The initial (line haul) mode of shipment code in the lower right corner of the block (see F-402).</P>
                        <P>(5) Block 5—Discount terms.</P>
                        <P>(i) The contractor may enter the discount in terms of percentages on all copies of the MIRR.</P>
                        <P>(ii) Use the procedures in F-406 when the MIRR is used as an invoice.</P>
                        <P>(6) Block 6—Invoice no./date.</P>
                        <P>(i) The contractor may enter the invoice number and actual or estimated date of invoice submission on all copies of the MIRR. When the date is estimated, enter an “E” after the date. Do not correct MIRRs other than invoice copies to reflect the actual date of invoice submission.</P>
                        <P>(ii) Use the procedures in F-406 when the MIRR is used as an invoice.</P>
                        <P>(7) Block 7—Page/of. Consecutively number the pages of the MIRR. On each page enter the total number of pages of the MIRR.</P>
                        <P>(8) Block 8—Acceptance point. Enter an “S” for Origin or “D” for destination.</P>
                        <P>(9) Block 9—Prime contractor/code. Enter the code and address.</P>
                        <P>(10) Block 10—Administered by/code. Enter the code and address of the contract administration office cited in the contract.</P>
                        <P>(11) Block 11—Shipped from/code/fob.</P>
                        <P>(i) Enter the code and address of the “Shipped From” location. If identical to Block 9, enter “See Block 9.”</P>
                        <P>(ii) For performance of services line items which do not require delivery of items upon completion of services, enter the code and address of the location at which the services were performed. If the DD Form 250 covers performance at multiple locations, or if identical to Block 9, enter “See Block 9.”</P>
                        <P>(iii) Enter on the same line and to the right of “FOB” an “S” for Origin or “D” for Destination as specified in the contract. Enter an alphabetic “O” if the “FOB” point cited in the contract is other than origin or destination.</P>
                        <P>(iv) For destination or origin acceptance shipments involving discount terms, enter “DISCOUNT EXPEDITE” in at least one-half inch outline-type style letters across Blocks 11 and 12. Do not obliterate other information in these blocks.</P>
                        <P>(12) Block 12—Payment will be made by/code. Enter the code and address of the payment office cited in the contract.</P>
                        <P>(13) Block 13—Shipped to/code. Enter the code and address from the contract or shipping instructions.</P>
                        <P>(14) Block 14—Marked for/code. Enter the code and address from the contract or shipping instructions. When three-character project codes are provided in the contract or shipping instructions, enter the code in the body of the block, prefixed by “Proj”; do not enter in the Code block.</P>
                        <P>(15) Block 15—Item No. See paragraph F-301(b)(14) with the exception to F301(b)(2)(B)2 that line item numbers not in accordance with the Uniform Contract Line Item Numbering System may be entered without regard to positioning.</P>
                        <P>(16) Block 16—Stock/part No./description.</P>
                        <P>(i) Use single or double spacing between line items when there are less than four line items. Use double spacing when there are four or more line items. Enter the following for each line item:</P>
                        <P>(A) The national stock number (NSN) or noncatalog number. Where applicable, include a prefix or suffix. If a number is not provided, or it is necessary to supplement the number, include other identification such as the manufacturer's name or Federal supply code (as published in Cataloging Handbook H4-1), and the part number. Show additional part numbers in parentheses or slashes. Show the descriptive noun of the item nomenclature and if provided, the Government assigned management/material control code. The contractor may use the following technique in the case of equal kind supply items. The first entry shall be the description without regard to kind. For example, “Shoe-Low Quarter-Black,” “Resistor,” “Vacuum Tube,” etc. Below this description, enter the contract line item number in Block 15 and Stock/Part number followed by the size or type in Block 16.</P>
                        <P>(B) On the next printing line, if required by the contract for control purposes, enter: The make, model, serial number, lot, batch, hazard indicator, or similar description.</P>
                        <P>(C) On the next printing lines enter—</P>
                        <P>
                            (
                            <E T="03">1</E>
                            ) The MIPR number prefixed by “MIPR” or the MILSTRIP requisition number(s) when provided in the contract; or
                        </P>
                        <P>
                            (
                            <E T="03">2</E>
                            ) Shipping instructions followed on the same line (when more than one requisition is entered) by the unit for payment and the quantity shipped against each requisition.
                        </P>
                        <P>
                            Example:
                            <PRTPAGE P="780"/>
                        </P>
                        <FP>V04696-185-750XY19059A—EA 5</FP>
                        <FP>N0018801776038XY3211BA—EA 200</FP>
                        <FP>AT650803050051AAT6391J—EA 1000</FP>
                        <P>(D) When a TCN is assigned for each line item, enter on the next line the transportation control number prefixed by “TCN.”</P>
                        <P>(ii) For service line items, enter the word “SERVICE” followed by as short a description as is possible in no more than 20 additional characters. Some examples of service line items are maintenance, repair, alteration, rehabilitation, engineering, research, development, training, and testing. Do not complete Blocks 4, 13, and 14 when there is no shipment of material.</P>
                        <P>(iii) For all contracts administered by the Defense Contract Management Agency, with the exception of fast pay procedures, enter and complete the following:</P>
                        <FP>Gross Shipping Wt.</FP>
                        <FP>________________________</FP>
                        <FP>State weight in pounds only.</FP>
                        <P>(iv) Starting with the next line, enter the following as appropriate (entries may be extended through Block 20). When entries apply to more than one line item in the MIRR, enter them only once after the last line item entry. Reference applicable line item numbers.</P>
                        <P>(A) Enter in capital letters any special handling instructions/limits for material environmental control, such as temperature, humidity, aging, freezing, shock, etc.</P>
                        <P>
                            (B) When a shipment is chargeable to Navy appropriation 17X4911, enter the appropriation, bureau control number (BCN), and authorization accounting activity (AAA) number (
                            <E T="03">e.g.,</E>
                             17X4911-14003-104).
                        </P>
                        <P>(C) When the Navy transaction type code (TC), “2T” or “7T” is included in the appropriation data, enter “TC 2T” or “TC 7T.”</P>
                        <P>(D) When an NSN is required by but not cited in a contract and has not been furnished by the Government, the contractor may make shipment without the NSN at the direction of the contracting officer. Enter the authority for such shipment.</P>
                        <P>(E) When Government furnished property (GFP) is included with or incorporated into the line item, enter the letters “GFP.”</P>
                        <P>(F) When shipment consists of replacements for supplies previously furnished, enter in capital letters “REPLACEMENT SHIPMENT.” (See F-401, Block 17, for replacement indicators.)</P>
                        <P>
                            (G) On shipments of Government furnished aeronautical equipment (GFAE) under Air Force contracts, enter the assignment AERNO control number, 
                            <E T="03">e.g.,</E>
                             “AERNO 60-6354.”
                        </P>
                        <P>(H) For items shipped with missing components, enter and complete the following:</P>
                        <FP>“Item(s) shipped short of the following component(s):</FP>
                        <FP>NSN or comparable identification ________, Quantity ________, Estimated Value ________, Authority ________”</FP>
                        <FP>(I) When shipment is made of components which were short on a prior shipment, enter and complete the following:</FP>
                        <FP>“These components were listed as shortages on shipment number ________, date shipped ________”</FP>
                        <P>(J) When shipments involve drums, cylinders, reels, containers, skids, etc., designated as returnable under contract provisions, enter and complete the following:</P>
                        <FP>“Return to ________, Quantity ________, Item ________, Ownership (Government/contractor).”</FP>
                        <P>(K) Enter the total number of shipping containers, the type of containers, and the container number(s) assigned for the shipment.</P>
                        <P>(L) On foreign military sales (FMS) shipments, enter the special markings, and FMS case identifier from the contract. Also enter the gross weight.</P>
                        <P>(M) When test/evaluation results are a condition of acceptance and are not available prior to shipment, the following note shall be entered if the shipment is approved by the contracting officer:</P>
                        <P>“Note: Acceptance and payment are contingent upon receipt of approved test/evaluation results.”</P>
                        <P>The contracting officer will advise—</P>
                        <P>
                            (
                            <E T="03">1</E>
                            ) The consignee of the results (approval/disapproval); and
                        </P>
                        <P>
                            (
                            <E T="03">2</E>
                            ) The contractor to withhold invoicing pending attachment of the approved test/evaluation results.
                        </P>
                        <P>(N) The copy of the DD Form 250 required to support payment for destination acceptance (top copy of those with shipment) or ARP origin acceptance shall be identified as follows: enter “PAYMENT COPY” in approximately one-half inch outline type style letters with “FORWARD TO BLOCK 12 ADDRESS” in approximately one-quarter inch letters immediately below. Do not obliterate any other entries.</P>
                        <P>(O) For clothing and textile contracts containing a bailment clause, enter the words “GFP UNIT VALUE.”</P>
                        <P>(P) When the initial unit incorporating an approved value engineering change proposal (VECP) is shipped, enter the following statement:</P>
                        <FP>This is the initial unit delivered which incorporates VECP No. ________, Contract Modification No. ________, dated ________</FP>
                        <P>(17) Block 17—Quantity shipped/received.</P>
                        <P>
                            (i) Enter the quantity shipped, using the unit of measure in the contract for payment. When a second unit of measure is used for purposes other than payment, enter the appropriate quantity directly below in parentheses.
                            <PRTPAGE P="781"/>
                        </P>
                        <P>(ii) On the final shipment of a line item of a contract containing a clause permitting a variation of quantity and an underrun condition exists, the prime contractor shall enter a “Z” below the last digit of the quantity. Where the final shipment is from other than the prime contractor's plant and an underrun condition exists, the prime contractor may elect either to—</P>
                        <P>(A) Direct the subcontractor making the final shipment to enter a “Z” below the quantity; or</P>
                        <P>(B) Upon determination that all subcontractors have completed their shipments, correct the DD Form 250 (see F-405) coving the final shipment of the line item from the prime contractor's plant by addition of a “Z” below the quantity. Do not use the “Z” on deliveries which equal or exceed the contract line item quantity.</P>
                        <P>(iii) For replacement shipments, enter “A” below the last digit of the quantity, to designate first replacement, “B” for second replacement, etc. Do not use the final shipment indicator “Z” on underrun deliveries when a final line item shipment is replaced.</P>
                        <GPOTABLE COLS="1" OPTS="L0" CDEF="s160">
                            <ROW>
                                <ENT I="21">17. QUANTITY</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="22"> </ENT>
                            </ROW>
                            <ROW>
                                <ENT I="22"> </ENT>
                            </ROW>
                        </GPOTABLE>
                        <FP>SHIP/REC'D</FP>
                        <FP>1000</FP>
                        <FP>(10)</FP>
                        <FP>       Z</FP>
                        <P>(iv) If the quantity received is the same quantity shipped and all items are in apparent good condition, enter by a check mark. If different, enter actual quantity received in apparent good condition below quantity shipped and circle. The receiving activity will annotate the DD Form 250 stating the reason for the difference.</P>
                        <P>(18) Block 18—Unit. Enter the abbreviation of the unit measure as indicated in the contract for payment. Where a second unit of measure is indicated in the contract for purposes other than payment or used for shipping purposes, enter the second unit of measure directly below in parentheses. Authorized abbreviations are listed in MIL-STD-129, Marking for Shipping and Storage. For example, LB for pound, SH for sheet.</P>
                        <GPOTABLE COLS="1" OPTS="L0" CDEF="s160">
                            <ROW>
                                <ENT I="21">18. UNIT</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">LB</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">(SH)</ENT>
                            </ROW>
                        </GPOTABLE>
                        <P>(19) Block 19—Unit price. The contractor may, at its option, enter unit prices on all MIRR copies, except as a minimum:</P>
                        <P>(i) The contractor shall enter unit prices on all MIRR copies for each item of property fabricated or acquired for the Government and delivered to a contractor as Government furnished property (GFP). Get the unit price from Section B of the contract. If the unit price is not available, use an estimate. The estimated price should be the contractor's estimate of what the items will cost the Government. When the price is estimated, enter an “E” after the unit price.</P>
                        <P>(ii) Use the procedures in F-406 when the MIRR is used as an invoice.</P>
                        <P>(iii) For clothing and textile contracts containing a bailment clause, enter the cited Government furnished property unit value opposite “GFP UNIT VALUE” entry in Block 16.</P>
                        <P>(iv) Price all copies of DD Forms 250 for FMS shipments with actual prices, if available. If actual price are not available, use estimated prices. When the price is estimated, enter an “E” after the price.</P>
                        <P>(20) Block 20—AMOUNT. Enter the extended amount when the unit price is entered in Block 19.</P>
                        <P>(21) Block 21—Contract quality assurance (CQA).</P>
                        <P>(i) The words “conform to contract” contained in the printed statements in Blocks 21a and 21b relate to quality and to the quantity of the items on the report. Do not modify the statements. Enter notes taking exception in Block 16 or on attached supporting documents with an appropriate block cross-reference.</P>
                        <P>(ii) When a shipment is authorized under alternative release procedure, attach or include the appropriate contractor signed certificate on the top copy of the DD Form 250 copies distributed to the payment office or attach or include the appropriate contractor certificate on the contract administration office copy when contract administration (Block 10 of the DD Form 250) is performed by the Defense Contract Management Agency.</P>
                        <P>(iii) When contract terms provide for use of Certificate of Conformance and shipment is made under these terms, the contractor shall enter in capital letters “CERTIFICATE OF CONFORMANCE” in Block 21a on the next line following the CQA and acceptance statements. Attach or include the appropriate contractor signed certificate on the top copy of the DD Form 250 copies distributed to the payment office or attach or include the appropriate certificate on the contract administration office copy when contract administration (Block 10 of the DD Form 250) is performed by the Defense Contract Management Agency. In addition, attach a copy of the signed certificate to, or enter on, copies of the MIRR sent with shipment.</P>
                        <P>(iv) Origin.</P>
                        <P>(A) The authorized Government representative must—</P>
                        <P>
                            (
                            <E T="03">1</E>
                            ) Place an “X” in the appropriate CQA and/or acceptance box(es) to show origin CQA and/or acceptance. When the contract requires CQA at destination in addition to origin CQA, enter an asterisk at the end of the statement and an explanatory note in Block 16;
                        </P>
                        <P>
                            (
                            <E T="03">2</E>
                            ) Sign and date;
                            <PRTPAGE P="782"/>
                        </P>
                        <P>
                            (
                            <E T="03">3</E>
                            ) Enter the typed, stamped, or printed name, title, mailing address, and commercial telephone number.
                        </P>
                        <P>(B) When alternative release procedures apply—</P>
                        <P>
                            (
                            <E T="03">1</E>
                            ) The contractor or subcontractor shall complete the entries required under paragraph (A) and enter in capital letters “ALTERNATIVE RELEASE PROCEDURE” on the next line following the printed CQA/acceptance statement.
                        </P>
                        <P>
                            (
                            <E T="03">2</E>
                            ) When acceptance is at origin and contract administration is performed by an office other than the Defense Contract Management Agency, the contractor shall furnish the four payment office copies of the MIRR to the authorized Government representative for dating and signing of one copy and forwarding of all copies to the payment office.
                        </P>
                        <P>
                            (
                            <E T="03">3</E>
                            ) When acceptance is at origin and contract administration is performed by the Defense Contract Management Agency, furnish the contract administration office copy of the MIRR to the authorized Government representative for dating and signing and forwarding to the contract administration office (see F-501, Table 1).
                        </P>
                        <P>(C) When fast pay procedures apply, the contractor or subcontractor shall enter in capital letters “FAST PAY” on the next line following the printed CQA/acceptance statement. When CQA is required, the authorized Government representative shall execute the block as required by paragraph (A).</P>
                        <P>(D) When Certificate of Conformance procedures apply, inspection or inspection and acceptance are at source, and the contractor's Certificate of Conformance is required, the contractor shall enter in capital letters “CERTIFICATE OF CONFORMANCE” as required by paragraph (b)(21)(iii) of this appendix.</P>
                        <P>
                            (
                            <E T="03">1</E>
                            ) For contracts administered by an office other than the Defense Contract Management Agency, furnish the four payment office copies of the MIRR to the authorized Government representative for dating and signing of one copy, and forwarding of all copies to the payment office.
                        </P>
                        <P>
                            (
                            <E T="03">2</E>
                            ) For contracts administered by the Defense Contract Management Agency, furnish the contract administration office copy of the MIRR to the authorized Government representative for dating and signing and forwarding to the contract administration office (see F-401, Table 1).
                        </P>
                        <P>
                            (
                            <E T="03">3</E>
                            ) When acceptance is at destination, no entry shall be made other than “CERTIFICATE OF CONFORMANCE.”
                        </P>
                        <P>(v) Destination.</P>
                        <P>(A) When acceptance at origin is indicated in Block 21a, make no entries in Block 21b.</P>
                        <P>(B) When CQA and acceptance or acceptance is at destination, the authorized Government representative must—</P>
                        <P>
                            (
                            <E T="03">1</E>
                            ) Place an “X” in the appropriate box(es);
                        </P>
                        <P>
                            (
                            <E T="03">2</E>
                            ) Sign and date; and
                        </P>
                        <P>
                            (
                            <E T="03">3</E>
                            ) Enter typed, stamped, or printed name, title, mailing address, and commercial telephone number.
                        </P>
                        <P>(C) When “ALTERNATIVE RELEASE PROCEDURE” is entered in Block 21a and acceptance is at destination, the authorized Government representative must complete the entries required by paragraph (b)(21)(v)(B) of this appendix.</P>
                        <P>(D) Forward the executed payment copy or MILSCAP format identifier PKN or PKP to the payment office cited in Block 12 within four work days (five days when MILSCAP Format is used) after delivery and acceptance of the shipment by the receiving activity. Forward one executed copy of the final DD Form 250 to the contract administration office cited in Block 10 for implementing contract closeout procedures.</P>
                        <P>(E) When “FAST PAY” is entered in Block 21a, make no entries in this block.</P>
                        <P>(22) Block 22—Receiver's use. The authorized representative of the receiving activity (Government or contractor) must use this block to show receipt, quantity, and condition. The authorized representative must—</P>
                        <P>(i) Enter the date the supplies arrived. For example, when off-loading or in-checking occurs subsequent to the day of arrival of the carrier at the installation, the date of the carrier's arrival is the date received for purposes of this block;</P>
                        <P>(ii) Sign; and</P>
                        <P>(iii) Enter typed, stamped, or printed name, title, mailing address, and commercial telephone number.</P>
                        <P>(23) Block 23—Contractor use only. Self explanatory.</P>
                        <SECHD>F-402 Mode/method of shipment codes.</SECHD>
                        <P>See paragraph F-302.</P>
                        <SECHD>F-403 Consolidated shipments.</SECHD>
                        <P>When individual shipments are held at the contractor's plant for authorized transportation consolidation to a single bill of lading, the contractor may prepare the DD Forms 250 at the time of CQA or acceptance prior to the time of actual shipment (see Block 3).</P>
                        <SECHD>F-404 Multiple consignee instructions.</SECHD>
                        <P>The contractor may prepare one MIRR when the identical line item(s) of a contract are to be shipped to more than one consignee, with the same or varying quantities, and the shipment requires origin acceptance. Prepare the MIRR using the procedures in this appendix with the following changes:</P>
                        <P>(a) Blocks 2, 4, 13, and, if applicable, 14—Enter “See Attached Distribution List.”</P>
                        <P>
                            (b) Block 15—The contractor may group item numbers for identical stock/part number and description.
                            <PRTPAGE P="783"/>
                        </P>
                        <P>(c) Block 17—Enter the “total” quantity shipped by line item or, if applicable, grouped identical line items.</P>
                        <P>(d) Use the DD Form 250c to list each individual “Shipped To” and “Marked For” with—</P>
                        <P>(1) Code(s) and complete shipping address and a sequential shipment number for each;</P>
                        <P>(2) Line item number(s);</P>
                        <P>(3) Quantity;</P>
                        <P>(4) MIPR number(s), preceded by “MIPR,” or the MILSTRIP requisition number, and quantity for each when provided in the contract or shipping instructions; and</P>
                        <P>(5) If applicable, bill of lading number, TCN, and mode of shipment code.</P>
                        <P>(e) The contractor may omit those distribution list pages of the DD Form 250c that are not applicable to the consignee. Provide a complete MIRR for all other distribution.</P>
                        <SECHD>F-405 Correction instructions.</SECHD>
                        <P>Make a new revised MIRR or correct the original when, because of errors or omissions, it is necessary to correct the MIRR after distribution has been made. Use data identical to that of the original MIRR. Do not correct MIRRs for Blocks 19 and 20 entries. Make the corrections as follows—</P>
                        <P>(a) Circle the error and place the corrected information in the same block; if space is limited, enter the corrected information in Block 16 referencing the error page and block. Enter omissions in Block 16 referencing omission page and block. For example—</P>
                        <GPOTABLE COLS="2" OPTS="L0" CDEF="xl50,r50">
                            <BOXHD>
                                <CHED H="1" O="L">2. SHIPMENT NO.</CHED>
                                <CHED H="1" O="L">17. QUANTITY</CHED>
                            </BOXHD>
                            <ROW>
                                <ENT I="22"> </ENT>
                                <ENT>SHIP/REC'D</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="01">(AAA0001)</ENT>
                                <ENT/>
                            </ROW>
                            <ROW>
                                <ENT I="22"> </ENT>
                                <ENT>19</ENT>
                            </ROW>
                            <ROW>
                                <ENT I="05">See Block 16</ENT>
                                <ENT>(17)</ENT>
                            </ROW>
                            <ROW RUL="s">
                                <ENT I="05">____________________</ENT>
                                <ENT>____________________</ENT>
                            </ROW>
                            <TNOTE>     16. STOCK/PART NO. DESCRIPTION</TNOTE>
                            <TNOTE>CORRECTIONS:</TNOTE>
                            <TNOTE>Refer Block 2: Change shipment No. AAA001 to AAA0010 on all pages of the MIRR.</TNOTE>
                            <TNOTE>Refer Blocks 15, 16, 17, and 18, page 2: Delete in entirety Line Item No. 0006. This item was not shipped.</TNOTE>
                        </GPOTABLE>
                        <P>(b) When corrections have been made to entries for line items (Block 15) or quantity (Block 17), enter the words “CORRECTIONS HAVE BEEN VERIFIED” on page 1. The authorized Government representative will date and sign immediately below the statement. This verification statement and signature are not required for other corrections.</P>
                        <P>(c) Clearly mark the pages of the MIRR requiring correction with the words “CORRECTED COPY.” Avoid obliterating any other entries. Where corrections are made only on continuation sheets, also mark page number 1 with the words “CORRECTED COPY.”</P>
                        <P>(d) Page 1 and only those continuation pages marked “CORRECTED COPY” shall be distributed to the initial distribution. A complete MIRR with corrections shall be distributed to new addressee(s) created by error corrections.</P>
                        <SECHD>F-406 Invoice instructions.</SECHD>
                        <P>(a) Contractors shall submit payment requests and receiving reports in electronic form, unless an exception in DFARS 232.7002 applies. Contractor submission of the material inspection and receiving information required by this appendix by using the WAWF electronic form (see paragraph (b) of the clause at DFARS 252.232-7003) fulfills the requirement for an MIRR.</P>
                        <P>(b) If the contracting officer authorizes the contractor to submit an invoice in paper form, the Government encourages, but does not require, the contractor to use the MIRR as an invoice, in lieu of a commercial form. If commercial forms are used, identify the related MIRR shipment number(s) on the form. If using the MIRR as an invoice, prepare the MIRR and forward the required number of copies to the payment office as follows:</P>
                        <P>(1) Complete Blocks 5, 6, 19, and 20. Block 6 shall contain the invoice number and date. Column 20 shall be totaled.</P>
                        <P>
                            (2) Mark in letters approximately one inch high, first copy: “ORIGINAL INVOICE,” for all invoice submissions; and three copies: “INVOICE COPY,” when the payment office requires four copies. Questions regarding the appropriate number of copies (
                            <E T="03">i.e.,</E>
                             one or four) should be directed to the applicable payment office.
                        </P>
                        <P>(3) Forward the appropriate number of copies to the payment office (Block 12 address), except when acceptance is at destination and a Navy finance office will make payment, forward to destination.</P>
                        <P>(4) Separate the copies of the MIRR used as an invoice from the copies of the MIRR used as a receiving report.</