[Title 48 CFR ]
[Code of Federal Regulations (annual edition) - October 1, 1996 Edition]
[From the U.S. Government Printing Office]
48
Federal Acquisition Regulations System
[[Page i]]
CHAPTER 1 (Parts 1 to 51)
Revised as of October 1, 1996
CONTAINING
A CODIFICATION OF DOCUMENTS
OF GENERAL APPLICABILITY
AND FUTURE EFFECT
AS OF OCTOBER 1, 1996
With Ancillaries
Published by
the Office of the Federal Register
National Archives and Records
Administration
as a Special Edition of
the Federal Register
[[Page ii]]
U.S. GOVERNMENT PRINTING OFFICE
WASHINGTON : 1996
For sale by U.S. Government Printing Office
Superintendent of Documents, Mail Stop: SSOP, Washington, DC 20402-9328
[[Page iii]]
Table of Contents
Page
Explanation................................................. v
Title 48:
Chapter 1--Federal Acquisition Regulation................. 3
Finding Aids:
Table of CFR Titles and Chapters.......................... 1045
Alphabetical List of Agencies Appearing in the CFR........ 1061
List of CFR Sections Affected............................. 1071
[[Page iv]]
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Cite this Code: CFR
To cite the regulations in this volume use title, part
and section number. Thus, 48 CFR 1.000 refers to title
48, part 1, section 000.
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[[Page v]]
EXPLANATION
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.
Each volume of the Code is revised at least once each calendar year
and issued on a quarterly basis approximately as follows:
Title 1 through Title 16.................................as of January 1
Title 17 through Title 27..................................as of April 1
Title 28 through Title 41...................................as of July 1
Title 42 through Title 50................................as of October 1
The appropriate revision date is printed on the cover of each
volume.
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HOW TO USE THE CODE OF FEDERAL REGULATIONS
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OMB CONTROL NUMBERS
The Paperwork Reduction Act of 1980 (Pub. L. 96-511) requires
Federal agencies to display an OMB control number with their information
collection request.
[[Page 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.
OBSOLETE PROVISIONS
Provisions that become obsolete before the revision date stated on
the cover of each volume are not carried. Code users may find the text
of provisions in effect on a given date in the past by using the
appropriate numerical list of sections affected. For the period before
January 1, 1986, consult either the List of CFR Sections Affected, 1949-
1963, 1964-1972, or 1973-1985, published in seven separate volumes. For
the period beginning January 1, 1986, a ``List of CFR Sections
Affected'' is published at the end of each CFR volume.
CFR INDEXES AND TABULAR GUIDES
A subject index to the Code of Federal Regulations is contained in a
separate volume, revised annually as of January 1, entitled CFR Index
and Finding Aids. This volume contains the Parallel Table of Statutory
Authorities and Agency Rules (Table I), and Acts Requiring Publication
in the Federal Register (Table II). A list of CFR titles, chapters, and
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that volume.
The Federal Register Index is issued monthly in cumulative form.
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the daily Federal Register.
A List of CFR Sections Affected (LSA) is published monthly, keyed to
the revision dates of the 50 CFR titles.
REPUBLICATION OF MATERIAL
There are no restrictions on the republication of material appearing
in the Code of Federal Regulations.
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For a legal interpretation or explanation of any regulation in this
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Richard L. Claypoole,
Director,
Office of the Federal Register.
October 1, 1996.
[[Page vii]]
THIS TITLE
Title 48--Federal Acquisition Regulations System is composed of
eight volumes. The chapters in these volumes are arranged as follows:
Chapter 1 (parts 1 to 51), chapter 1 (parts 52 to 99), chapter 2 (parts
201 to 251 and parts 252 to 299), 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, 1996.
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 implementing 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 supplementing the Federal
acquisition regulations.
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).
The two volumes containing chapter 1 include an index to the Federal
acquisition regulations. The second volume, containing chapter 1 (parts
52 to 99), includes contract clauses and forms.
For this volume, Cheryl E. Sirofchuck was Chief Editor. The Code of
Federal Regulations publication program is under the direction of
Frances D. McDonald, assisted by Alomha S. Morris.
[[Page viii]]
[[Page 1]]
TITLE 48--FEDERAL ACQUISITION REGULATIONS SYSTEM
(This book contains chapter 1, parts 1 to 51)
--------------------------------------------------------------------
Part
chapter 1--Federal Acquisition Regulation................... 1
[[Page 3]]
CHAPTER 1--FEDERAL ACQUISITION REGULATION
--------------------------------------------------------------------
SUBCHAPTER A--GENERAL
Part Page
1 Federal Acquisition Regulations System...... 5
2 Definitions of words and terms.............. 19
3 Improper business practices and personal
conflicts of interest................... 24
4 Administrative matters...................... 60
SUBCHAPTER B--ACQUISITION PLANNING
5 Publicizing contract actions................ 77
6 Competition requirements.................... 91
7 Acquisition planning........................ 102
8 Required sources of supplies and services... 116
9 Contractor qualifications................... 134
10 Market research............................. 168
11 Describing agency needs..................... 169
12 Acquisition of commercial items............. 181
SUBCHAPTER C--CONTRACTING METHODS AND CONTRACT TYPES
13 Simplified acquisition procedures........... 193
14 Sealed bidding.............................. 207
15 Contracting by negotiation.................. 237
16 Types of contracts.......................... 298
17 Special contracting methods................. 323
18 [Reserved]
SUBCHAPTER D--SOCIOECONOMIC PROGRAMS
19 Small business programs..................... 337
20-21 [Reserved]
22 Application of labor laws to government
acquisitions............................ 400
23 Environment, conservation, occupational
safety, and drug-free workplace......... 459
24 Protection of privacy and freedom of
information............................. 472
25 Foreign acquisition......................... 474
[[Page 4]]
26 Other socioeconomic programs................ 494
SUBCHAPTER E--GENERAL CONTRACTING REQUIREMENTS
27 Patents, data, and copyrights............... 497
28 Bonds and insurance......................... 537
29 Taxes....................................... 557
30 Cost accounting standards administration.... 563
31 Contract cost principles and procedures..... 571
32 Contract financing.......................... 631
33 Protests, disputes, and appeals............. 693
SUBCHAPTER F--SPECIAL CATEGORIES OF CONTRACTING
34 Major system acquisition.................... 706
35 Research and development contracting........ 709
36 Construction and architect-engineer
contracts............................... 719
37 Service contracting......................... 737
38 Federal supply schedule contracting......... 746
39 Acquisition of information technology....... 747
40 [Reserved]
41 Acquisition of utility services............. 749
SUBCHAPTER G--CONTRACT MANAGEMENT
42 Contract administration..................... 758
43 Contract modifications...................... 793
44 Subcontracting policies and procedures...... 798
45 Government property......................... 805
46 Quality assurance........................... 846
47 Transportation.............................. 864
48 Value engineering........................... 898
49 Termination of contracts.................... 905
50 Extraordinary contractual actions........... 949
51 Use of Government sources by contractors.... 958
FAR Index 964
Editorial Note: The Federal Acquisition Regulations Index also follows
the text of Chapter 1 in 48 CFR Chapter 1, Parts 52-99.
[[Page 5]]
SUBCHAPTER A--GENERAL
PART 1--FEDERAL ACQUISITION REGULATIONS SYSTEM--Table of Contents
Sec.
1.000 Scope of part.
Subpart 1.1--Purpose, Authority, Issuance
1.101 Purpose.
1.102 Statement of guiding principles for the federal acquisition
system.
1.102-1 Discussion.
1.102-2 Performance standards.
1.102-3 Acquisition team.
1.102-4 Role of the acquisition team.
1.103 Authority.
1.104 Applicability.
1.105 Issuance.
1.105-1 Publication and code arrangement.
1.105-2 Arrangement of regulations.
1.105-3 Copies.
1.106 OMB approval under the Paperwork Reduction Act.
Subpart 1.2--Administration
1.201 Maintenance of the FAR.
1.201-1 The two councils.
1.201-2 FAR Secretariat.
1.202 Agency compliance with the FAR.
Subpart 1.3--Agency Acquisition Regulations
1.301 Policy.
1.302 Limitations.
1.303 Publication and codification.
1.304 Agency control and compliance procedures.
Subpart 1.4--Deviations from the FAR
1.400 Scope of subpart.
1.401 Definition.
1.402 Policy.
1.403 Individual deviations.
1.404 Class deviations.
1.405 Deviations pertaining to treaties and executive agreements.
Subpart 1.5--Agency and Public Participation
1.501 Solicitation of agency and public views.
1.501-1 Definition.
1.501-2 Opportunity for public comments.
1.501-3 Exceptions.
1.502 Unsolicited proposed revisions.
1.503 Public meetings.
Subpart 1.6--Career Development, Contracting Authority, and
Responsibilities.
1.601 General.
1.602 Contracting officers.
1.602-1 Authority.
1.602-2 Responsibilities.
1.602-3 Ratification of unauthorized commitments.
1.603 Selection, appointment, and termination of appointment.
1.603-1 General.
1.603-2 Selection.
1.603-3 Appointment.
1.603-4 Termination.
Subpart 1.7--Determinations and Findings
1.700 Scope of subpart.
1.701 Definition.
1.702 General.
1.703 Class determinations and findings.
1.704 Content.
1.705 Supersession and modification.
1.706 Expiration.
1.707 Signatory authority.
Authority: 40 U.S.C. 486(c); 10 U.S.C. Chapter 137; and 42 U.S.C.
2473(c).
Source: 48 FR 42103, Sept. 19, 1983, unless otherwise noted.
Sec. 1.000 Scope of part.
This part sets forth basic policies and general information about
the Federal Acquisition Regulations System including purpose, authority,
applicability, issuance, arrangement, numbering, dissemination,
implementation, supplementation, maintenance, administration, and
deviation. Subparts 1.2, 1.3, and 1.4 prescribe administrative
procedures for maintaining the FAR System.
Subpart 1.1--Purpose, Authority, Issuance
Sec. 1.101 Purpose.
The Federal Acquisition Regulations System is established for the
codification and publication of uniform policies and procedures for
acquisition by all executive agencies. The Federal Acquisition
Regulations System consists of the Federal Acquisition Regulation (FAR),
which is the primary document, and agency acquisition regulations that
implement or supplement the
[[Page 6]]
FAR. The FAR System does not include internal agency guidance of the
type described in 1.301(a)(2).
[48 FR 42103, Sept. 19, 1983, as amended at 51 FR 27116, July 29, 1986]
Sec. 1.102 Statement of guiding principles for the federal acquisition system.
(a) The vision for the Federal Acquisition System is to deliver on a
timely basis the best value product or service to the customer, while
maintaining the public's trust and fulfilling public policy objectives.
Participants in the acquisition process should work together as a team
and should be empowered to make decisions within their area of
responsibility.
(b) The Federal Acquisition System will--
(1) Satisfy the customer in terms of cost, quality, and timeliness
of the delivered product or service by, for example--
(i) Maximizing the use of commercial products and services;
(ii) Using contractors who have a track record of successful past
performance or who demonstrate a current superior ability to perform;
and
(iii) Promoting competition;
(2) Minimize administrative operating costs;
(3) Conduct business with integrity, fairness, and openness; and
(4) Fulfill public policy objectives.
(c) The Acquisition Team consists of all participants in Government
acquisition including not only representatives of the technical, supply,
and procurement communities but also the customers they serve, and the
contractors who provide the products and services.
(d) The role of each member of the Acquisition Team is to exercise
personal initiative and sound business judgment in providing the best
value product or service to meet the customer's needs. In exercising
initiative, Government members of the Acquisition Team may assume if a
specific strategy, practice, policy or procedure is in the best
interests of the Government and is not addressed in the FAR nor
prohibited by law (statute or case law), Executive order or other
regulation, that the strategy, practice, policy or procedure is a
permissible exercise of authority.
[60 FR 34733, July 3, 1995]
Sec. 1.102-1 Discussion.
(a) Introduction. The statement of Guiding Principles for the
Federal Acquisition System (System) represents a concise statement
designed to be user-friendly for all participants in Government
acquisition. The following discussion of the principles is provided in
order to illuminate the meaning of the terms and phrases used. The
framework for the System includes the Guiding Principles for the System
and the supporting policies and procedures in the FAR.
(b) Vision. All participants in the System are responsible for
making acquisition decisions that deliver the best value product or
service to the customer. Best value must be viewed from a broad
perspective and is achieved by balancing the many competing interests in
the System. The result is a system which works better and costs less.
[60 FR 34733, July 3, 1995]
Sec. 1.102-2 Performance standards.
(a) Satisfy the customer in terms of cost, quality, and timeliness
of the delivered product or service. (1) The principal customers for the
product or service provided by the System are the users and line
managers, acting on behalf of the American taxpayer.
(2) The System must be responsive and adaptive to customer needs,
concerns, and feedback. Implementation of acquisition policies and
procedures, as well as consideration of timeliness, quality and cost
throughout the process, must take into account the perspective of the
user of the product or service.
(3) When selecting contractors to provide products or perform
services the Government will use contractors who have a track record of
successful past performance or who demonstrate a current superior
ability to perform.
(4) The Government must not hesitate to communicate with the
commercial sector as early as possible in the
[[Page 7]]
acquisition cycle to help the Government determine the capabilities
available in the commercial marketplace. The Government will maximize
its use of commercial products and services in meeting Government
requirements.
(5) It is the policy of the System to promote competition in the
acquisition process.
(6) The System must perform in a timely, high quality, and cost-
effective manner.
(7) All members of the Team are required to employ planning as an
integral part of the overall process of acquiring products or services.
Although advance planning is required, each member of the Team must be
flexible in order to accommodate changing or unforeseen mission needs.
Planning is a tool for the accomplishment of tasks, and application of
its discipline should be commensurate with the size and nature of a
given task.
(b) Minimize administrative operating costs. (1) In order to ensure
that maximum efficiency is obtained, rules, regulations, and policies
should be promulgated only when their benefits clearly exceed the costs
of their development, implementation, administration, and enforcement.
This applies to internal administrative processes, including reviews,
and to rules and procedures applied to the contractor community.
(2) The System must provide uniformity where it contributes to
efficiency or where fairness or predictability is essential. The System
should also, however, encourage innovation, and local adaptation where
uniformity is not essential.
(c) Conduct business with integrity, fairness, and openness. (1) An
essential consideration in every aspect of the System is maintaining the
public's trust. Not only must the System have integrity, but the actions
of each member of the Team must reflect integrity, fairness, and
openness. The foundation of integrity within the System is a competent,
experienced, and well-trained, professional workforce. Accordingly each
member of the Team is responsible and accountable for the wise use of
public resources as well as acting in a manner which maintains the
public's trust. Fairness and openness require open communication among
team members, internal and external customers, and the public.
(2) To achieve efficient operations, the System must shift its focus
from ``risk avoidance'' to one of ``risk management.'' The cost to the
taxpayer of attempting to eliminate all risk is prohibitive. The
Executive Branch will accept and manage the risk associated with
empowering local procurement officials to take independent action based
on their professional judgment.
(d) Fulfill public policy objectives. The System must support the
attainment of public policy goals adopted by the Congress and the
President. In attaining these goals, and in its overalll operations, the
process shall ensure the efficient use of public resources.
[60 FR 34734, July 3, 1995]
Sec. 1.102-3 Acquisition team.
The purpose of defining the Federal Acquisition Team (Team) in the
Guiding Principles is to ensure that participants in the System are
identified--beginning with the customer and ending with the contractor
of the product or service. By identifying the team members in this
manner, teamwork, unity of purpose, and open communication among the
members of the Team in sharing the vision and achieving the goal of the
System are encouraged. Individual team members will participate in the
acquisition process at the appropriate time.
[60 FR 34734, July 3, 1995]
Sec. 1.102-4 Role of the acquisition team.
(a) Government members of the Team must be empowered to make
acquisition decisions within their areas of responsibility, including
selection, negotiation, and administration of contracts consistent with
the Guiding Principles. In particular, the contracting officer must have
the authority to the maximum extent practicable and consistent with law,
to determine the application of rules, regulations, and policies, on a
specific contract.
(b) The authority to make decisions and the accountability for the
decision made will be delegated to the lowest level within the System,
consistent with law.
[[Page 8]]
(c) The Team must be prepared to perform the functions and duties
assigned. The Government is committed to provide training, professional
development, and other resources necessary for maintaining and improving
the knowledge, skills, and abilities for all Government participants on
the Team, both with regard to their particular area of responsibility
within the System, and their respective role as a team member. The
contractor community is encouraged to do likewise.
(d) The System will foster cooperative relationships between the
Government and its contractors consistent with its overriding
responsibility to the taxpayers.
(e) The FAR outlines procurement policies and procedures that are
used by members of the Acquisition Team. If a policy or procedure, or a
particular strategy or practice, is in the best interest of the
Government and is not specifically addressed in the FAR, nor prohibited
by law (statute or case law), Executive order or other regulation,
Government members of the Team should not assume it is prohibited.
Rather, absence of direction should be interpreted as permitting the
Team to innovative and use sound business judgment that is otherwise
consistent with law and within the limits of their authority.
[60 FR 34734, July 3, 1995]
Sec. 1.103 Authority.
(a) The development of the FAR System is in accordance with the
requirements of the Office of Federal Procurement Policy (OFPP) Act of
1974 (Pub. L. 93-400), as amended by Pub. L. 96-83, and OFPP Policy
Letter 85-1, Federal Acquisition Regulations System, dated August 19,
1985.
(b) The FAR is prepared, issued, and maintained, and the FAR System
is prescribed, jointly by the Secretary of Defense, the Administrator of
General Services, and the Administrator, National Aeronautics and Space
Administration, under their several statutory authorities.
[48 FR 42103, Sept. 19, 1983, as amended at 51 FR 27116, July 29, 1986.
Redesignated at 60 FR 34733, July 3, 1995]
Sec. 1.104 Applicability.
The FAR applies to all acquisitions as defined in part 2 of the FAR,
except where expressly excluded.
[48 FR 42103, Sept. 19, 1983. Redesignated at 60 FR 34733, July 3, 1995]
1.105 Issuance.
Sec. 1.105-1 Publication and code arrangement.
(a) The FAR is published in (1) the daily issue of the Federal
Register, (2) cumulated form in the Code of Federal Regulations (CFR),
and (3) a separate loose-leaf edition.
(b) The FAR is issued as Chapter 1 of Title 48, CFR. Subsequent
chapters are reserved for agency acquisition regulations that implement
or supplement the FAR (see subpart 1.3). The CFR Staff will assign
chapter numbers to requesting agencies.
(c) Each numbered unit or segment (e.g., part, subpart, section,
etc.) of an agency acquisition regulation that is codified in the CFR
shall begin with the chapter number. However, the chapter number
assigned to the FAR will not be included in the numbered units or
segments of the FAR.
[48 FR 42103, Sept. 19, 1983. Redesignated at 60 FR 34733, July 3, 1995]
Sec. 1.105-2 Arrangement of regulations.
(a) General. The FAR is divided into subchapters, parts (each of
which deals with a separate aspect of acquisition), subparts, sections,
and subsections.
(b) Numbering. (1) The numbering system permits the discrete
identification of every FAR paragraph. The digits to the left of the
decimal point represent the part number. The numbers to the right of the
decimal point and to the left of the dash, represent, in order, the
subpart (one or two digits), and the section (two digits). The number to
the right of the dash represents the subsection. Subdivisons may be used
at the section and subsection level to identify individual paragraphs.
The following example illustrates the make-up of a FAR number citation
(note that subchapters are not used with citations):
[[Page 9]]
[GRAPHIC] [TIFF OMITTED] TC03AP91.000
(2) Subdivisions below the section or subsection level shall consist
of parenthetical alphanumerics reading from highest to lowest indenture
as follows: lower case alphabet, Arabic numbers, lower case Roman
numerals, and upper case alphabet. The following example is
illustrative:
(a)(1)(i)(A)
Subdivisions, below the 4th level shall repeat the sequence.
(c) References and citations. (1) Unless otherwise stated, cross-
references indicate parts, subparts, sections, subsections, paragraphs,
subparagraphs, or subdivisions of this regulation.
(2) This regulation may be referred to as the Federal Acquisition
Regulation or the FAR.
(3) Using the FAR coverage at 9.106-4(d) as a typical illustration,
reference to the--
(i) Part would be ``FAR Part 9'' outside the FAR and ``Part 9''
within the FAR.
(ii) Subpart would be ``FAR Subpart 9.1'' outside the FAR and
``Subpart 9.1'' within the FAR.
(iii) Section would be ``FAR 9.106'' outside the FAR and ``9.106''
within the FAR.
(iv) Subsection would be ``FAR 9.106-4'' outside the FAR and
``9.106-4'' within the FAR.
(v) Paragraph would be ``FAR 9.106-4(d)'' outside the FAR and
``9.106-4(d)'' within the FAR.
(4) Citations of authority (e.g., statutes or executive orders) in
the FAR shall follow the Federal Register form guides.
[48 FR 42103, Sept. 19, 1983. Redesignated at 60 FR 34733, July 3, 1995]
Sec. 1.105-3 Copies.
Copies of the FAR in Federal Register, loose-leaf, and CFR form may
be purchased from the Superintendent of Documents, Government Printing
Office (GPO), Washington, DC 20402.
[48 FR 42103, Sept. 19, 1983. Redesignated at 60 FR 34733, July 3, 1995]
Sec. 1.106 OMB approval under the Paperwork Reduction Act.
The Paperwork Reduction Act of 1980 (Pub. L. 96-511) imposes a
requirement on Federal agencies to obtain approval from the Office of
Management and Budget (OMB) before collecting information from ten or
more members of the public. The information collection and recordkeeping
requirements contained in this regulation have been approved by the OMB.
The following OMB control numbers apply:
------------------------------------------------------------------------
OMB control
FAR segment No.
------------------------------------------------------------------------
3.103...................................................... 9000-0018
3.104-9.................................................... 9000-0103
3.104-12(a)(12)............................................ 9000-0103
3.4........................................................ 9000-0003
4.102...................................................... 9000-0033
4.7........................................................ 9000-0034
4.9........................................................ 9000-0097
5.405...................................................... 9000-0036
7.2........................................................ 9000-0082
8.203-2.................................................... 9000-0017
8.5........................................................ 9000-0113
9.1........................................................ 9000-0011
9.2........................................................ 9000-0020
9.5........................................................ 9000-0111
14.201..................................................... 9000-0034
14.202-4................................................... 9000-0040
14.202-5................................................... 9000-0039
14.205..................................................... 9000-0002
14.205-4(c)................................................ 9000-0037
14.214..................................................... 9000-0105
14.407..................................................... 9000-0038
14.5....................................................... 9000-0041
15.106..................................................... 9000-0034
15.404..................................................... 9000-0037
15.7....................................................... 9000-0078
15.8....................................................... 9000-0013
15.804-8................................................... 9000-0115
15.812-1(b)................................................ 9000-0080
15.813-1................................................... 9000-0105
15.813-2................................................... 9000-0105
15.813-3................................................... 9000-0105
15.813-6................................................... 9000-0105
19.7....................................................... 9000-0006
22.103..................................................... 9000-0065
22.606-2(b)................................................ 1215-0157
22.8....................................................... 1215-0072
22.11...................................................... 9000-0066
22.13...................................................... 1215-0072
22.14...................................................... 1215-0072
22.15...................................................... 9000-0127
23.602..................................................... 9000-0107
27.3....................................................... 9000-0095
27.4....................................................... 9000-0090
28.1....................................................... 9000-0045
28.106-1(b)................................................ 9000-0119
28.2....................................................... 9000-0045
29.304..................................................... 9000-0059
30......................................................... 9000-0093
30.6....................................................... 9000-0129
[[Page 10]]
31.205-2................................................... 9000-0072
31.205-46.................................................. 9000-0079
31.205-46(a)(3)............................................ 9000-0088
32......................................................... 9000-0035
32.000..................................................... 9000-0138.
32.1....................................................... 9000-0070
and 9000-
0138.
32.2....................................................... 9000-0138.
32.4....................................................... 9000-0073
32.5....................................................... 9000-0010
and 9000-
0138.
32.7....................................................... 9000-0074
32.9....................................................... 9000-0102
32.10...................................................... 9000-0138.
33......................................................... 9000-0035
34.1....................................................... 9000-0132
36.302..................................................... 9000-0037
36.603..................................................... 9000-0004
and
9000-0005
36.701..................................................... 9000-0037
41.004-2(c)................................................ 9000-0125
42.203..................................................... 9000-0026
42.7....................................................... 9000-0013
42.12...................................................... 9000-0076
42.13...................................................... 9000-0076
42.14...................................................... 9000-0056
45......................................................... 9000-0075
46......................................................... 9000-0077
47......................................................... 9000-0061
48......................................................... 9000-0027
49......................................................... 9000-0028
50......................................................... 9000-0029
51.1....................................................... 9000-0031
51.2....................................................... 9000-0032
52.203-2................................................... 9000-0018
52.203-7................................................... 9000-0091
52.203-8................................................... 9000-0103
52.203-9................................................... 9000-0103
52.204-3................................................... 9000-0097
52.207-3................................................... 9000-0114
52.208-1................................................... 9000-0017
52.214-14.................................................. 9000-0047
52.214-15.................................................. 9000-0044
52.214-16.................................................. 9000-0044
52.214-17.................................................. 9000-0018
52.214-21.................................................. 9000-0039
52.214-26.................................................. 9000-0034
52.214-28.................................................. 9000-0013
52.215-2................................................... 9000-0034
52.215-6................................................... 9000-0046
52.215-11.................................................. 9000-0048
52.215-19.................................................. 9000-0044
52.215-20.................................................. 9000-0047
52.215-21.................................................. 9000-0078
52.215-24.................................................. 9000-0013
52.215-25.................................................. 9000-0013
52.215-26.................................................. 9000-0080
52.215-40.................................................. 9000-0015
52.215-41.................................................. 9000-0013
52.215-42.................................................. 9000-0013
52.216-2................................................... 9000-0068
52.216-3................................................... 9000-0068
52.216-4................................................... 9000-0068
52.216-5................................................... 9000-0071
52.216-6................................................... 9000-0071
52.216-7................................................... 9000-0069
52.216-10.................................................. 9000-0067
52.216-13.................................................. 9000-0069
52.216-15.................................................. 9000-0069
52.216-16.................................................. 9000-0067
52.216-17.................................................. 9000-0067
52.219-9................................................... 9000-0006
52.219-10.................................................. 9000-0006
52.219-19.................................................. 9000-0100
52.219-20.................................................. 9000-0100
52.219-21.................................................. 9000-0100
52.222-2................................................... 9000-0065
52.222-4................................................... 1215-0119
52.222-6................................................... 1215-0140
52.222-8................................................... 1215-0149
and
1215-0017
52.222-11.................................................. 9000-0014
52.222-18.................................................. 9000-0127
52.222-21.................................................. 1215-0072
52.222-22.................................................. 1215-0072
52.222-23.................................................. 1215-0072
52.222-25.................................................. 1215-0072
52.222-26.................................................. 1215-0072
52.222-27.................................................. 1215-0072
52.222-35.................................................. 1215-0072
52.222-36.................................................. 1215-0072
52.222-41.................................................. 1215-0017
and
1215-0150
52.222-46.................................................. 9000-0066
52.223-1................................................... 9000-0021
52.223-6(b)(5)............................................. 9000-0101
52.233-7................................................... 9000-0117
52.225-1................................................... 9000-0024
52.225-6................................................... 9000-0023
52.225-8................................................... 9000-0025
52.225-10.................................................. 9000-0022
52.225-20.................................................. 9000-0130
52.228-1................................................... 9000-0045
52.228-2................................................... 9000-0045
52.228-3................................................... 9000-0045
52.229-2................................................... 9000-0059
52.230-6................................................... 9000-0129
52.232-5................................................... 9000-0070
52.232-7................................................... 9000-0070
52.232-10.................................................. 9000-0070
52.232-12.................................................. 9000-0073
52.232-13.................................................. 9000-0010
52.232-14.................................................. 9000-0010
52.232-15.................................................. 9000-0010
52.232-16.................................................. 9000-0010
52.232-20.................................................. 9000-0074
52.232-21.................................................. 9000-0074
52.232-22.................................................. 9000-0074
52.232-27.................................................. 9000-0102
52.232-29.................................................. 9000-0138.
52.232-30.................................................. 9000-0138.
52.232-31.................................................. 9000-0138.
52.232-32.................................................. 9000-0138.
52.233-1................................................... 9000-0035
52.234-1................................................... 9000-0133
52.236-5................................................... 9000-0062
52.236-13.................................................. 1220-0029
and
9000-0060
52.236-15.................................................. 9000-0058
52.236-19.................................................. 9000-0064
52.241-2................................................... 9000-0122
52.241-6................................................... 9000-0123
52.241-11.................................................. 9000-0126
52.241-13.................................................. 9000-0124
52.242-12.................................................. 9000-0056
52.243-1................................................... 9000-0026
52.243-2................................................... 9000-0026
52.243-3................................................... 9000-0026
52.243-4................................................... 9000-0026
52.243-6................................................... 9000-0026
[[Page 11]]
52.243-7................................................... 9000-0026
52.245-2................................................... 9000-0075
52.245-3................................................... 9000-0075
52.245-5................................................... 9000-0075
52.245-7................................................... 9000-0075
52.245-8................................................... 9000-0075
52.245-9................................................... 9000-0075
52.245-10.................................................. 9000-0075
52.245-11.................................................. 9000-0075
52.245-16.................................................. 9000-0075
52.245-17.................................................. 9000-0075
52.245-18.................................................. 9000-0075
52.246-2................................................... 9000-0077
52.246-3................................................... 9000-0077
52.246-4................................................... 9000-0077
52.246-5................................................... 9000-0077
52.246-6................................................... 9000-0077
52.246-7................................................... 9000-0077
52.246-8................................................... 9000-0077
52.246-10.................................................. 9000-0077
52.246-12.................................................. 9000-0077
52.246-15.................................................. 9000-0077
52.247-2................................................... 9000-0053
52.247-29.................................................. 9000-0061
52.247-30.................................................. 9000-0061
52.247-31.................................................. 9000-0061
52.247-32.................................................. 9000-0061
52.247-33.................................................. 9000-0061
52.247-34.................................................. 9000-0061
52.247-35.................................................. 9000-0061
52.247-36.................................................. 9000-0061
52.247-37.................................................. 9000-0061
52.247-38.................................................. 9000-0061
52.247-39.................................................. 9000-0061
52.247-40.................................................. 9000-0061
52.247-41.................................................. 9000-0061
52.247-42.................................................. 9000-0061
52.247-43.................................................. 9000-0061
52.247-44.................................................. 9000-0061
52.247-51.................................................. 9000-0057
52.247-53.................................................. 9000-0055
52.247-57.................................................. 9000-0061
52.247-63.................................................. 9000-0054
52.247-64.................................................. 9000-0054
52.248-1................................................... 9000-0027
52.248-2................................................... 9000-0027
52.248-3................................................... 9000-0027
52.249-2................................................... 9000-0028
52.249-3................................................... 9000-0028
52.249-5................................................... 9000-0028
52.249-6................................................... 9000-0028
52.249-11.................................................. 9000-0028
52.250-1................................................... 9000-0029
52.253-1................................................... 9000-0104
53.105..................................................... 9000-0104
53.236-1(a)................................................ 9000-0037
SF 24...................................................... 9000-0045
SF 25...................................................... 9000-0045
SF 25-A.................................................... 9000-0045
SF 28...................................................... 9000-0001
SF 34...................................................... 9000-0045
SF 35...................................................... 9000-0045
SF 129..................................................... 9000-0002
SF 254..................................................... 9000-0004
SF 255..................................................... 9000-0005
SF 273..................................................... 9000-0045
SF 274..................................................... 9000-0045
SF 275..................................................... 9000-0045
SF 294..................................................... 9000-0006
SF 295..................................................... 9000-0007
SF 1403.................................................... 9000-0011
SF 1404.................................................... 9000-0011
SF 1405.................................................... 9000-0011
SF 1406.................................................... 9000-0011
SF 1407.................................................... 9000-0011
SF 1408.................................................... 9000-0011
SF 1411.................................................... 9000-0013
SF 1413.................................................... 9000-0014
SF 1416.................................................... 9000-0045
SF 1417.................................................... 9000-0037
SF 1418.................................................... 9000-0119
SF 1423.................................................... 9000-0015
SF 1424.................................................... 9000-0015
SF 1426.................................................... 9000-0015
SF 1427.................................................... 9000-0015
SF 1428.................................................... 9000-0015
SF 1429.................................................... 9000-0015
SF 1430.................................................... 9000-0015
SF 1431.................................................... 9000-0015
SF 1432.................................................... 9000-0015
SF 1433.................................................... 9000-0015
SF 1434.................................................... 9000-0015
SF 1435.................................................... 9000-0012
SF 1436.................................................... 9000-0012
SF 1437.................................................... 9000-0012
SF 1438.................................................... 9000-0012
SF 1439.................................................... 9000-0012
SF 1440.................................................... 9000-0012
SF 1443.................................................... 9000-0010
SF 1444.................................................... 9000-0089
SF 1445.................................................... 9000-0089
SF 1446.................................................... 9000-0089
SF 1448.................................................... 9000-0013
SF 1449.................................................... 9000-0136
All other requirements..................................... 9000-0063
------------------------------------------------------------------------
[59 FR 67065, Dec. 28, 1994. Redesignated at 60 FR 34733, 34736, July 3,
1995, as amended at 60 FR 42650, 42665, Aug. 16, 1995; 60 FR 48211,
Sept. 18, 1995; 60 FR 49710, Sept. 26, 1995; 61 FR 18916, Apr. 29, 1996;
61 FR 39188, July 26, 1996]
Subpart 1.2--Administration
1.201 Maintenance of the FAR.
Sec. 1.201-1 The two councils.
(a) Subject to the authorities discussed in 1.102, revisions to the
FAR will be prepared and issued through the coordinated action of two
councils, the Defense Acquisition Regulatory Council (DAR Council) and
the Civilian Agency Acquisition Council (CAA Council). Members of these
councils shall--
(1) Represent their agencies on a full-time basis;
(2) Be selected for their superior qualifications in terms of
acquisition experience and demonstrated professional expertise; and
(3) Be funded by their respective agencies.
(b) The chairperson of the CAA Council shall be the representative
of the
[[Page 12]]
Administrator of General Services. The other members of this council
shall be one each representative from the (1) Departments of
Agriculture, Commerce, Energy, Health and Human Services, Interior,
Labor, State, Transportation, and Treasury, and (2) Environmental
Protection Agency, Small Business Administration, and Department of
Veterans Affairs.
(c) The Director of the DAR Council shall be the representative of
the Secretary of Defense. The operation of the DAR Council will be as
prescribed by the Secretary of Defense. Membership shall include
representatives of the military Departments, the Defense Logistics
Agency, and the National Aeronautics and Space Administration.
(d) Responsibility for processing revisions to the FAR is
apportioned by the two councils so that each council has cognizance over
specified parts or subparts.
(e) Each council shall be responsible for--
(1) Agreeing on all revisions with the other council;
(2) Submitting to the FAR Secretariat (see 1.201-2) the information
required under paragraphs 1.501-2(b) and (e) for publication in the
Federal Register of a notice soliciting comments on a proposed revision
to the FAR;
(3) Considering all comments received in response to notice of
proposed revisions;
(4) Arranging for public meetings;
(5) Preparing any final revision in the appropriate FAR format and
language; and
(6) Submitting any final revision to the FAR Secretariat for
publication in the Federal Register and printing for distribution.
[48 FR 42103, Sept. 19, 1983, as amended at 50 FR 2269, Jan. 15, 1985;
50 FR 26903, June 28, 1985; 51 FR 2649, Jan. 17, 1986; 54 FR 29280, July
11, 1989]
Sec. 1.201-2 FAR Secretariat.
(a) The General Services Administration is responsible for
establishing and operating the FAR Secretariat to print, publish, and
distribute the FAR through the Code of Federal Regulations system
(including a loose-leaf edition with periodic updates).
(b) Additionally, the FAR Secretariat shall provide the two councils
with centralized services for--
(1) Keeping a synopsis of current FAR cases and their status;
(2) Assigning FAR case numbers;
(3) Maintaining official files;
(4) Assisting parties interested in reviewing the files on completed
cases; and
(5) Performing miscellaneous administrative tasks pertaining to the
maintenance of the FAR.
Sec. 1.202 Agency compliance with the FAR.
Agency compliance with the FAR (see 1.304) is the responsibility of
the Secretary of Defense (for the military departments and defense
agencies), the Administrator of General Services (for civilian agencies
other than NASA), and the Administrator of NASA (for NASA activities).
Subpart 1.3--Agency Acquisition Regulations
Sec. 1.301 Policy.
(a)(1) Subject to the authorities in paragraph (c) below and other
statutory authority, an agency head may issue or authorize the issuance
of agency acquisition regulations that implement or supplement the FAR
and incorporate, together with the FAR, agency policies, procedures,
contract clauses, solicitation provisions, and forms that govern the
contracting process or otherwise control the relationship between the
agency, including any of its suborganizations, and contractors or
prospective contractors.
(2) Subject to the authorities in (c) below and other statutory
authority, an agency head may issue or authorize the issuance of
internal agency guidance at any organizational level (e.g., designations
and delegations of authority, assignments of responsibilities, work-flow
procedures, and internal reporting requirements).
(b) Agency heads shall establish procedures to ensure that agency
acquisition regulations are published for comment in the Federal
Register in conformance with the procedures in subpart 1.5 and as
required by section 22 of
[[Page 13]]
the Office of Federal Procurement Policy Act, as amended (41 U.S.C.
418b), and other applicable statutes, when they have a significant
effect beyond the internal operating procedures of the agency or have a
significant cost or administrative impact on contractors or offerors.
However, publication is not required for issuances that merely implement
or supplement higher level issuances that have previously undergone the
public comment process, unless such implementation or supplementation
results in an additional significant cost or administrative impact on
contractors or offerors or effect beyond the internal operating
procedures of the issuing organization. Issuances under 1.301(a)(2) need
not be publicized for public comment.
(c) When adopting acquisition regulations, agencies shall ensure
that they comply with the Paperwork Reduction Act (44 U.S.C. 3501, et
seq.) as implemented in 5 CFR part 1320 (see 1.105) and the Regulatory
Flexibility Act (5 U.S.C. 601, et seq.). Normally, when a law requires
publication of a proposed regulation, the Regulatory Flexibility Act
applies and agencies must prepare written analyses or certifications as
provided in the law.
(d) Agency acquisition regulations implementing or supplementing the
FAR are, for--
(1) The military departments and defense agencies, issued subject to
the authority of the Secretary of Defense;
(2) NASA activities, issued subject to the authorities of the
Administrator of NASA; and
(3) The civilian agencies other than NASA, issued by the heads of
those agencies subject to the overall authority of the Administrator of
General Services or independent authority the agency may have.
[48 FR 42103, Sept. 19, 1983, as amended at 50 FR 2269, Jan. 15, 1985;
54 FR 5054, Jan. 31, 1989]
Sec. 1.302 Limitations.
Agency acquisition regulations shall be limited to--
(a) Those necessary to implement FAR policies and procedures within
the agency; and
(b) Additional policies, procedures, solicitation provisions, or
contract clauses that supplement the FAR to satisfy the specific needs
of the agency.
Sec. 1.303 Publication and codification.
(a) Agency-wide acquisition regulations shall be published in the
Federal Register as required by law, shall be codified under an assigned
chapter in Title 48, Code of Federal Regulations, and shall parallel the
FAR in format, arrangement, and numbering system (but see 1.104-1(c)).
Coverage in an agency acquisition regulation that implements a specific
part, subpart, section, or subsection of the FAR shall be numbered and
titled to correspond to the appropriate FAR number and title.
Supplementary material for which there is no counterpart in the FAR
shall be codified using chapter, part, subpart, section, or subsection
numbers of 70 and up (e.g., for the Department of Interior, whose
assigned chapter number in Title 48 is 14, part 1470, subpart 1401.70,
section 1401.370, or subsection 1401.301-70.)
(b) Issuances under 1.301(a)(2) need not be published in the Federal
Register.
[48 FR 42103, Sept. 19, 1983, as amended at 50 FR 2269, Jan. 15, 1985]
Sec. 1.304 Agency control and compliance procedures.
(a) Under the authorities of 1.301(c), agencies shall control and
limit issuance of agency acquisition regulations and, in particular,
local agency directives that restrain the flexibilities found in the
FAR, and shall establish formal procedures for the review of these
documents to assure compliance with this part 1.
(b) Agency acquisition regulations shall not--
(1) Unnecessarily repeat, paraphrase, or otherwise restate material
contained in the FAR or higher-level agency acquisition regulations; or
(2) Except as required by law or as provided in subpart 1.4,
conflict or be inconsistent with FAR content.
(c) Agencies shall evaluate all regulatory coverage in agency
acquisition regulations to determine if it could apply to other
agencies. Coverage that
[[Page 14]]
is not peculiar to one agency shall be recommended for inclusion in the
FAR.
[48 FR 42103, Sept. 19, 1983, as amended at 61 FR 39190, July 26, 1996]
Subpart 1.4--Deviations from the FAR
Sec. 1.400 Scope of subpart.
This subpart prescribes the policies and procedures for authorizing
deviations from the FAR. Exceptions pertaining to the use of forms
prescribed by the FAR are covered in part 53 rather than in this
subpart.
Sec. 1.401 Definition.
Deviation means any one or combination of the following:
(a) The issuance or use of a policy, procedure, solicitation
provision (see definition in 52.101(a)), contract clause (see definition
in 52.101(a)), method, or practice of conducting acquisition actions of
any kind at any stage of the acquisition process that is inconsistent
with the FAR.
(b) The omission of any solicitation provision or contract clause
when its prescription requires its use.
(c) The use of any solicitation provision or contract clause with
modified or alternate language that is not authorized by the FAR (see
definitions of modification and alternate in 52.101(a)).
(d) The use of a solicitation provision or contract clause
prescribed by the FAR on a substantially as follows or substantially the
same as basis (see definitions in 52.101(a)), if such use is
inconsistent with the intent, principle, or substance of the
prescription or related coverage on the subject matter in the FAR.
(e) The authorization of lesser or greater limitations on the use of
any solicitation provision, contract clause, policy, or procedure
prescribed by the FAR.
(f) The issuance of policies or procedures that govern the
contracting process or otherwise control contracting relationships that
are not incorporated into agency acquisition regulations in accordance
with 1.301(a).
Sec. .402 Policy.
Unless precluded by law, executive order, or regulation, deviations
from the FAR may be granted as specified in this subpart when necessary
to meet the specific needs and requirements of each agency. The
development and testing of new techniques and methods of acquisition
should not be stifled simply because such action would require a FAR
deviation. The fact that deviation authority is required should not, of
itself, deter agencies in their development and testing of new
techniques and acquisition methods. Refer to 31.101 for instructions
concerning deviations pertaining to the subject matter of part 31,
Contract Cost Principles and Procedures. Deviations are not authorized
with respect to part 30. Refer to 30.201-5 for instructions concerning
waivers pertaining to Cost Accounting Standards.
[48 FR 42103, Sept. 19, 1983, as amended at 52 FR 35612, Sept. 22, 1987]
Sec. 1.403 Individual deviations.
Individual deviations affect only one contracting action, and,
unless 1.405(e) is applicable, may be authorized by agency heads or
their designees. The justification and agency approval shall be
documented in the contract file and a copy of the approved deviation
shall be furnished to the FAR Secretariat through a central agency
control point.
Sec. 1.404 Class deviations.
Class deviations affect more than one contracting action. When it is
known that a class deviation will be required on a permanent basis, an
agency should propose an appropriate FAR revision to cover the matter. A
copy of each approved class deviation shall be furnished to the FAR
Secretariat.
(a) For civilian agencies except NASA, class deviations may be
authorized by agency heads or their designees, unless 1.405(e) is
applicable. Delegation of this authority shall not be made below the
head of a contracting activity. Authorization of class deviations by
agency officials is subject to the following limitations:
(1) An agency official who may authorize a class deviation, before
doing so, shall consult with the chairperson
[[Page 15]]
of the Civilian Agency Acquisition Council (CAA Council), unless that
agency official determines that urgency precludes such consultation.
(2) Recommended revisions to the FAR shall be transmitted to the FAR
Secretariat by agency heads or their designees for authorizing class
deviations.
(b) For DOD, class deviations shall be controlled, processed, and
approved in accordance with the Defense FAR Supplement.
(c) For NASA, class deviations shall be controlled and approved by
the Associate Administrator for Procurement. Deviations shall be
processed in accordance with agency regulations.
[48 FR 42103, Sept. 19, 1983, as amended at 56 FR 15148, Apr. 15, 1991;
59 FR 11387, March 10, 1994]
Sec. 1.405 Deviations pertaining to treaties and executive agreements.
(a) Executive agreements, as used in this section, means Government-
to-Government agreements, including agreements with international
organizations, to which the United States is a party.
(b) Any deviation from the FAR required to comply with a treaty to
which the United States is a party is authorized, unless the deviation
would be inconsistent with FAR coverage based on a law enacted after the
execution of the treaty.
(c) Any deviation from the FAR required to comply with an executive
agreement is authorized unless the deviation would be inconsistent with
FAR coverage based on law.
(d) A copy of the text of any deviation authorized under paragraphs
(b) or (c) of this section shall be transmitted to the FAR Secretariat
through a central agency control point.
(e) If a deviation required to comply with a treaty or an executive
agreement is not authorized by paragraphs (b) or (c) of this section,
then the request for deviation shall be processed through the FAR
Secretariat to the appropriate council.
Subpart 1.5--Agency and Public Participation
Source: 50 FR 2269, Jan. 15, 1985, unless otherwise noted.
1.501 Solicitation of agency and public views.
Sec. 1.501-1 Definition.
Significant revisions, as used in this subpart, means revisions that
alter the substantive meaning of any coverage in the FAR System having a
significant cost or administrative impact on contractors or offerors, or
a significant effect beyond the internal operating procedures of the
issuing agency. This expression, for example, does not include
editorial, stylistic, or other revisions that have no impact on the
basic meaning of the coverage being revised.
Sec. 1.501-2 Opportunity for public comments.
(a) Views of agencies and nongovernmental parties or organizations
will be considered in formulating acquisition policies and procedures.
(b) The opportunity to submit written comments on proposed
significant revisions shall be provided by placing a notice in the
Federal Register. Each of these notices shall include--
(1) The text of the revision or, if it is impracticable to publish
the full text, a summary of the proposal;
(2) The address and telephone number of the individual from whom
copies of the revision, in full text, can be requested and to whom
comments thereon should be addressed; and
(3) When 1.501-3(b) is applicable, a statement that the revision is
effective on a temporary basis pending completion of the public comment
period.
(c) A minimum of 30 days and, normally, at least 60 days will be
given for the receipt of comments.
Sec. 1.501-3 Exceptions.
(a) Comments need not be solicited when the proposed coverage does
not constitute a significant revision.
(b) Advance comments need not be solicited when urgent and
compelling circumstances make solicitation of
[[Page 16]]
comments impracticable prior to the effective date of the coverage, such
as when a new statute must be implemented in a relatively short period
of time. In such case, the coverage shall be issued on a temporary basis
and shall provide for at least a 30 day public comment period.
Sec. 1.502 Unsolicited proposed revisions.
Consideration shall also be given to unsolicited recommendations for
revisions that have been submitted in writing with sufficient data and
rationale to permit their evaluation.
Sec. 1.503 Public meetings.
Public meetings may be appropriate when a decision to adopt, amend,
or delete coverage is likely to benefit from significant additional
views and discussion.
Subpart 1.6--Career Development, Contracting Authority, and
Responsibilities
Sec. 1.601 General.
(a) Unless specifically prohibited by another provision of law,
authority and responsibility to contract for authorized supplies and
services are vested in the agency head. The agency head may establish
contracting activities and delegate broad authority to manage the
agency's contracting functions to heads of such contracting activities.
Contracts may be entered into and signed on behalf of the Government
only by contracting officers. In some agencies, a relatively small
number of high level officials are designated contracting officers
solely by virtue of their positions. Contracting officers below the
level of a head of a contracting activity shall be selected and
appointed under 1.603.
(b) Agency heads may mutually agree to--
(1) Assign contracting functions and responsibilities from one
agency to another; and
(2) Create joint or combined offices to exercise acquisition
functions and responsibilities.
[60 FR 49721, Sept. 26, 1995]
1.602 Contracting officers.
Sec. 1.602-1 Authority.
(a) Contracting officers have authority to enter into, administer,
or terminate contracts and make related determinations and findings.
Contracting officers may bind the Government only to the extent of the
authority delegated to them. Contracting officers shall receive from the
appointing authority (see 1.603-1) clear instructions in writing
regarding the limits of their authority. Information on the limits of
the contracting officers' authority shall be readily available to the
public and agency personnel.
(b) No contract shall be entered into unless the contracting officer
ensures that all requirements of law, executive orders, regulations, and
all other applicable procedures, including clearances and approvals,
have been met.
Sec. 1.602-2 Responsibilities.
Contracting officers are responsible for ensuring performance of all
necessary actions for effective contracting, ensuring compliance with
the terms of the contract, and safeguarding the interests of the United
States in its contractual relationships. In order to perform these
responsibilities, contracting officers should be allowed wide latitude
to exercise business judgment. Contracting officers shall--
(a) Ensure that the requirements of 1.602-1(b) have been met, and
that sufficient funds are available for obligation;
(b) Ensure that contractors receive impartial, fair, and equitable
treatment; and
(c) Request and consider the advice of specialists in audit, law,
engineering, transportation, and other fields, as appropriate.
Sec. 1.602-3 Ratification of unauthorized commitments.
(a) Definitions.
Ratification, as used in this subsection, means the act of approving
an unauthorized commitment by an official who has the authority to do
so.
Unauthorized commitment, as used in this subsection, means an
agreement that is not binding solely because the Government
representative who made it lacked the authority to enter into
[[Page 17]]
that agreement on behalf of the Government.
(b) Policy. (1) Agencies should take positive action to preclude, to
the maximum extent possible, the need for ratification actions. Although
procedures are provided in this section for use in those cases where the
ratification of an unauthorized commitment is necessary, these
procedures may not be used in a manner that encourages such commitments
being made by Government personnel.
(2) Subject to the limitations in paragraph (c) of this subsection,
the head of the contracting activity, unless a higher level official is
designated by the agency, may ratify an unauthorized commitment.
(3) The ratification authority in subparagraph (b)(2) of this
subsection may be delegated in accordance with agency procedures, but in
no case shall the authority be delegated below the level of chief of the
contracting office.
(4) Agencies should process unauthorized commitments using the
ratification authority of this subsection instead of referring such
actions to the General Accounting Office for resolution. (See 1.602-
3(d).)
(5) Unauthorized commitments that would involve claims subject to
resolution under the Contract Disputes Act of 1978 should be processed
in accordance with subpart 33.2, Disputes and Appeals.
(c) Limitations. The authority in subparagraph (b)(2) of this
subsection may be exercised only when--
(1) Supplies or services have been provided to and accepted by the
Government, or the Government otherwise has obtained or will obtain a
benefit resulting from performance of the unauthorized commitment;
(2) The ratifying official has the authority to enter into a
contractual commitment;
(3) The resulting contract would otherwise have been proper if made
by an appropriate contracting officer;
(4) The contracting officer reviewing the unauthorized commitment
determines the price to be fair and reasonable;
(5) The contracting officer recommends payment and legal counsel
concurs in the recommendation, unless agency procedures expressly do not
require such concurrence;
(6) Funds are available and were available at the time the
unauthorized commitment was made; and
(7) The ratification is in accordance with any other limitations
prescribed under agency procedures.
(d) Nonratifiable commitments. Cases that are not ratifiable under
this subsection may be subject to resolution as recommended by the
General Accounting Office under its claim procedure (GAO Policy and
Procedures Manual for Guidance of Federal Agencies, Title 4, Chapter 2),
or as authorized by FAR part 50. Legal advice should be obtained in
these cases.
[53 FR 3689, Feb. 8, 1988, as amended at 60 FR 48225, Sept. 18, 1995]
Sec. 1.603 Selection, appointment, and termination of appointment.
Sec. 1.603-1 General.
Subsection 414(4) of title 41, United States Code, requires agency
heads to establish and maintain a procurement career management program
and a system for the selection, appointment, and termination of
appointment of contracting officers. Agency heads or their designees may
select and appoint contracting officers and terminate their
appointments. These selections and appointments shall be consistent with
Office of Federal Procurement Policy's (OFPP) standards for skill-based
training in performing contracting and purchasing duties as published in
OFPP Policy Letter No. 92-3, Procurement Professionalism Program
Policy--Training for Contracting Personnel, June 24, 1992.
[59 FR 67015, Dec. 28, 1994]
Sec. 1.603-2 Selection.
In selecting contracting officers, the appointing official shall
consider the complexity and dollar value of the acquisitions to be
assigned and the candidate's experience, training, education, business
acumen, judgment, character, and reputation. Examples of selection
criteria include--
(a) Experience in Government contracting and administration,
commercial purchasing, or related fields;
[[Page 18]]
(b) Education or special training in business administration, law,
accounting, engineering, or related fields;
(c) Knowledge of acquisition policies and procedures, including this
and other applicable regulations;
(d) Specialized knowledge in the particular assigned field of
contracting; and
(e) Satisfactory completion of acquisition training courses.
Sec. 1.603-3 Appointment.
(a) Contracting officers shall be appointed in writing on an SF
1402, Certificate of Appointment, which shall state any limitations on
the scope of authority to be exercised, other than limitations contained
in applicable law or regulation. Appointing officials shall maintain
files containing copies of all appointments that have not been
terminated.
(b) Agency heads are encouraged to delegate micro-purchase authority
to individuals who are employees of an executive agency or members of
the Armed Forces of the United States who will be using the supplies or
services being purchased. Individuals delegated this authority are not
required to be appointed on an SF 1402, but shall be appointed in
writing in accordance with agency procedures.
[61 FR 39190, July 26, 1996]
Sec. 1.603-4 Termination.
Termination of a contracting officer appointment will be by letter,
unless the Certificate of Appointment contains other provisions for
automatic termination. Terminations may be for reasons such as
reassignment, termination of employment, or unsatisfactory performance.
No termination shall operate retroactively.
Subpart 1.7--Determinations and Findings
Source: 50 FR 1726, Jan. 11, 1985 (interim rule), and 50 FR 52429,
Dec. 23, 1985 (final rule), unless otherwise noted.
Sec. 1.700 Scope of subpart.
This subpart prescribes general policies and procedures for the use
of determinations and findings (D&F's). Requirements for specific types
of D&F's can be found with the appropriate subject matter.
Sec. 1.701 Definition.
Determination and Findings (D&F) means a special form of written
approval by an authorized official that is required by statute or
regulation as a prerequisite to taking certain contracting actions. The
determination is a conclusion or decision supported by the findings. The
findings are statements of fact or rationale essential to support the
determination and must cover each requirement of the statute or
regulation.
Sec. 1.702 General.
(a) A D&F shall ordinarily be for an individual contract action.
Unless otherwise prohibited, class D&F's may be executed for classes of
contract action (see 1.703). The approval granted by a D&F is restricted
to the proposed contract action(s) reasonably described in that D&F.
D&F's may provided for a reasonable degree of flexibility. Furthermore,
in their application, reasonable variations in estimated quantities or
prices are permitted, unless the D&F specifies otherwise.
(b) When an option is anticipated, the D&F shall state the
approximate quantity to be awarded initially and the extent of the
increase to be permitted by the option.
Sec. 1.703 Class determinations and findings.
(a) A class D&F provides authority for a class of contracting
actions. A class may consist of contracting actions for the same or
related supplies or services or other contracting actions that require
essentially identical justification.
(b) The findings in a class D&F shall fully support the proposed
action either for the class as a whole or for each action. A class D&F
shall be for a specified period, with the expiration date stated in the
document.
(c) The contracting officer shall ensure that individual actions
taken pursuant to the authority of a class D&F are within the scope of
the D&F.
[[Page 19]]
Sec. 1.704 Content.
Each D&F shall set forth enough facts and circumstances to clearly
and convincingly justify the specific determination made. As a minimum,
each D&F shall include, in the prescribed agency format, the following
information:
(a) Identification of the agency and of the contracting activity and
specific identifications of the document as a Determination and
Findings.
(b) Nature and/or description of the action being approved.
(c) Citation of the appropriate statute and/or regulation upon which
the D&F is based.
(d) Findings that detail the particular circumstances, facts, or
reasoning essential to support the determination. Necessary supporting
documentation shall be obtained from appropriate requirements and
technical personnel.
(e) A determination, based on the findings, that the proposed action
is justified under the applicable statute or regulation.
(f) Expiration date of the D&F, if required (see 1.706(b)).
(g) The signature of the official authorized to sign the D&F (see
1.706) and the date signed.
Sec. 1.705 Supersession and modification.
(a) If a D&F is superseded by another D&F, that action shall not
render invalid any action taken under the original D&F prior to the date
of its supersession.
(b) A modification of the D&F will not require cancellation of the
solicitation if the D&F, as modified, supports the contracting action.
Sec. 1.706 Expiration.
Expiration dates are required for class D&F's and are optional for
individual D&F's. Authority to act under an individual D&F expires when
it is exercised or on an expiration date specified in the document,
whichever occurs first. Authority to act under a class D&F expires on
the expiration date specified in the document. When a solicitation has
been furnished to prospective offerors before the expiration date, the
authority under the D&F will continue until award of the contract(s)
resulting from that solicitation.
Sec. 1.707 Signatory authority.
When a D&F is required, it shall be signed by the appropriate
official in accordance with agency regulations. Authority to sign or
delegate signature authority for the various D&F's is as shown in the
applicable FAR part.
PART 2--DEFINITIONS OF WORDS AND TERMS--Table of Contents
Sec.
2.000 Scope of part.
Subpart 2.1--Definitions
2.101 Definitions.
Subpart 2.2--Definitions Clause
2.201 Contract clause.
Authority: 40 U.S.C. 486(c); 10 U.S.C. Chapter 137; and 42 U.S.C.
2473(c).
Source: 48 FR 42107, Sept. 19, 1983, unless otherwise noted.
Sec. 2.000 Scope of part.
This part defines words and terms commonly used in this regulation.
Other terms are defined in the part or subpart with which they are
particularly associated (see the Index for locations).
Subpart 2.1--Definitions
Sec. 2.101 Definitions.
As used throughout this regulation, the following words and terms
are used as defined in this subpart unless (a) the context in which they
are used clearly requires a different meaning or (b) a different
definition is prescribed for a particular part or portion of a part.
Acquisition means the acquiring by contract with appropriated funds
of supplies or services (including construction) by and for the use of
the Federal Government through purchase or lease, whether the supplies
or services are already in existence or must be created, developed,
demonstrated, and evaluated. Acquisition begins at the point when agency
needs are established and includes the description of requirements to
satisfy agency needs, solicitation and selection of sources, award of
contracts, contract financing,
[[Page 20]]
contract performance, contract administration, and those technical and
management functions directly related to the process of fulfilling
agency needs by contract.
Affiliates means associated business concerns or individuals if,
directly or indirectly, (a) either one controls or can control the other
or (b) a third party controls or can control both.
Agency head (see head of the agency).
Commercial component means any component that is a commercial item.
Commercial item means--
(a) Any item, other than real property, that is of a type
customarily used for nongovernmental purposes and that--
(1) Has been sold, leased, or licensed to the general public; or,
(2) Has been offered for sale, lease, or license to the general
public;
(b) Any item that evolved from an item described in paragraph (a) of
this definition through advances in technology or performance and that
is not yet available in the commercial marketplace, but will be
available in the commercial marketplace in time to satisfy the delivery
requirements under a Government solicitation;
(c) Any item that would satisfy a criterion expressed in paragraphs
(a) or (b) of this definition, but for--
(1) Modifications of a type customarily available in the commercial
marketplace; or
(2) Minor modifications of a type not customarily available in the
commercial marketplace made to meet Federal Government requirements.
``Minor'' modifications means modifications that do not significantly
alter the nongovernmental function or essential physical characteristics
of an item or component, or change the purpose of a process. Factors to
be considered in determining whether a modification is minor include the
value and size of the modification and the comparative value and size of
the final product. Dollar values and percentages may be used as
guideposts, but are not conclusive evidence that a modification is
minor;
(d) Any combination of items meeting the requirements of paragraphs
(a), (b), (c), or (e) of this definition that are of a type customarily
combined and sold in combination to the general public;
(e) Installation services, maintenance services, repair services,
training services, and other services if such services are procured for
support of an item referred to in paragraphs (a), (b), (c), or (d) of
this definition, and if the source of such services--
(1) Offers such services to the general public and the Federal
Government contemporaneously and under similar terms and conditions; and
(2) Offers to use the same work force for providing the Federal
Government with such services as the source uses for providing such
services to the general public;
(f) Services of a type offered and sold competitively in substantial
quantities in the commercial marketplace based on established catalog or
market prices for specific tasks performed under standard commercial
terms and conditions. This does not include services that are sold based
on hourly rates without an established catalog or market price for a
specific service performed;
(g) Any item, combination of items, or service referred to in
paragraphs (a) through (f), notwithstanding the fact that the item,
combination of items, or service is transferred between or among
separate divisions, subsidiaries, or affiliates of a contractor; or
(h) A nondevelopmental item, if the procuring agency determines the
item was developed exclusively at private expense and sold in
substantial quantities, on a competitive basis, to multiple State and
local governments.
Component means any item supplied to the Federal Government as part
of an end item or of another component.
Contract means a mutually binding legal relationship obligating the
seller to furnish the supplies or services (including construction) and
the buyer to pay for them. It includes all types of commitments that
obligate the Government to an expenditure of appropriated funds and
that, except as otherwise authorized, are in writing. In addition to
bilateral instruments, contracts include (but are not limited to) awards
and notices of awards; job orders or task letters issued under basic
ordering agreements; letter contracts;
[[Page 21]]
orders, such as purchase orders, under which the contract becomes
effective by written acceptance or performance; and bilaterial contract
modifications. Contracts do not include grants and cooperative
agreements covered by 31 U.S.C. 6301, et seq. For discussion of various
types of contracts, see part 16.
Contract administration office means an office that performs (a)
assigned postaward functions related to the administration of contracts
and (b) assigned preaward functions.
Contracting means purchasing, renting, leasing, or otherwise
obtaining supplies or services from nonfederal sources. Contracting
includes description (but not determination) of supplies and services
required, selection and solicitation of sources, preparation and award
of contracts, and all phases of contract administration. It does not
include making grants or cooperative agreements.
Contracting activity means an element of an agency designated by the
agency head and delegated broad authority regarding acquisition
functions.
Contracting office means an office that awards or executes a
contract for supplies or services and performs postaward functions not
assigned to a contract administration office.
Contracting officer means a person with the authority to enter into,
administer, and/or terminate contracts and make related determinations
and findings. The term includes certain authorized representatives of
the contracting officer acting within the limits of their authority as
delegated by the contracting officer. Administrative contracting officer
(ACO) refers to a contracting officer who is administering contracts.
Termination contracting officer (TCO) refers to a contracting officer
who is settling terminated contracts. A single contracting officer may
be responsible for duties in any or all of these areas. Reference in
this regulation to administrative contracting officer or termination
contracting officer does not (a) require that a duty be performed at a
particular office or activity or (b) restrict in any way a contracting
officer in the performance of any duty properly assigned.
Day means, unless otherwise specified, a calendar day.
Delivery order means an order for supplies placed against an
established contract or with Government sources.
Executive agency means an executive department, a military
department, or any independent establishment within the meaning of 5
U.S.C. 101, 102, and 104(1), respectively, and any wholly owned
Government corporation within the meaning of 31 U.S.C. 9101.
Facsimile means electronic equipment that communicates and
reproduces both printed and handwritten material. If used in conjunction
with a reference to a document, e.g., facsimile bid, the term refers to
a document (in the example given, a bid) that has been transmitted to
and received by the Government via facsimile.
Federal Acquisition Computer Network (FACNET) Architecture means the
Governmentwide Electronic Commerce/Electronic Data Interchange (EC/EDI)
operational capability for the acquisition of supplies and services that
provides for electronic data interchange of acquisition information
between the Government and the private sector, employs nationally and
internationally recognized data formats, and provides universal user
access.
Federal agency means any executive agency or any independent
establishment in the legislative or judicial branch of the Government
(except the Senate, the House of Representatives, the Architect of the
Capitol, and any activities under the Architect's direction).
Full FACNET means an agency has certified that it has implemented
all of the FACNET functions outlined in 4.504, and more than 75 percent
of eligible contracts (not otherwise exempted from FACNET) in amounts
exceeding the micro-purchase threshold, but not exceeding the simplified
acquisition threshold, were entered into by the agency during the
preceding fiscal year using an interim FACNET certified electronic
automated information system.
Governmentwide FACNET means that the Federal Government has
certified its FACNET capability, and more than 75 percent of eligible
contracts (not otherwise exempted from FACNET) in amounts exceeding the
micro-purchase
[[Page 22]]
threshold, but not exceeding the simplified acquisition threshold,
entered into by the executive agencies during the preceding fiscal year
were made through electronic automated information systems with full
FACNET certification.
Head of the agency (also called agency head) means the Secretary,
Attorney General, Administrator, Governor, Chairperson, or other chief
official of an executive agency, unless otherwise indicated, including
any deputy or assistant chief official of an executive agency; and the
term authorized representative means any person, persons, or board
(other than the contracting officer) authorized to act for the head of
the agency or Secretary.
Head of the contracting activity includes the official who has
overall responsibility for managing the contracting activity.
Information technology means any equipment, or interconnected
system(s) or subsystem(s) of equipment, that is used in the automatic
acquisition, storage, manipulation, management, movement, control,
display, switching, interchange, transmission, or reception of data or
information by the agency.
(a) 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 which--
(1) Requires the use of such equipment; or
(2) Requires the use, to a significant extent, of such equipment in
the performance of a service or the furnishing of a product.
(b) The term information technology includes computers, ancillary
equipment, software, firmware and similar procedures, services
(including support services), and related resources.
(c) The term information technology does not include any equipment
that is acquired by a contractor incidental to a contract.
Interim FACNET means a contracting office has been certified as
having implemented the electronic automated information systems
capability to provide widespread public notice of contracting
opportunities, issue solicitations, and receive responses to
solicitations and associated requests for information. Such capability
must allow the private sector to access notices of solicitations, access
and review solicitations, and respond to solicitations.
In writing or written means any worded or numbered expression which
can be read, reproduced, and later communicated, and includes
electronically transmitted and stored information.
Major system means that combination of elements that will function
together to produce the capabilities required to fulfill a mission need.
The elements may include hardware, equipment, software, or any
combination thereof, but exclude construction or other improvements to
real property. A system shall be considered a major system if--
(a) The Department of Defense is responsible for the system and the
total expenditures for research, development, test, and evaluation for
the system are estimated to be more than $75,000,000 (based on fiscal
year 1980 constant dollars) or the eventual total expenditure for the
acquisition exceeds $300,000,000 (based on fiscal year 1980 constant
dollars);
(b) A civilian agency is responsible for the system and total
expenditures for the system are estimated to exceed $750,000 (based on
fiscal year 1980 constant dollars) or the dollar threshold for a ``major
system'' established by the agency pursuant to Office of Management and
Budget Circular A-109, entitled ``Major System Acquisitions,'' whichever
is greater; or
(c) The system is designated a ``major system'' by the head of the
agency responsible for the system.
Market research means collecting and analyzing information about
capabilities within the market to satisfy agency needs.
May denotes the permissive. However, the words no person may... mean
that no person is required, authorized, or permitted to do the act
described.
Micro-purchase means an acquisition of supplies or services (except
construction), the aggregate amount of which does not exceed $2,500,
except that in the case of construction, the limit is $2,000.
Micro-purchase threshold means $2,500.
National defense means any activity related to programs for military
or
[[Page 23]]
atomic energy production or construction, military assistance to any
foreign nation, stockpiling, or space.
Nondevelopmental item means--
(a) Any previously developed item of supply used exclusively for
governmental purposes by a Federal agency, a State or local government,
or a foreign government with which the United States has a mutual
defense cooperation agreement;
(b) Any item described in paragraph (a) of this definition that
requires only minor modification or modifications of a type customarily
available in the commercial marketplace in order to meet the
requirements of the procuring department or agency; or
(c) Any item of supply being produced that does not meet the
requirements of paragraph (a) or (b) solely because the item is not yet
in use.
Offer means a response to a solicitation that, if accepted, would
bind the offeror to perform the resultant contract. Responses to
invitations for bids (sealed bidding) are offers called bids or sealed
bids; responses to requests for proposals (negotiation) are offers
called proposals; responses to requests for quotations (negotiation) are
not offers and are called quotes. For unsolicited proposals, see subpart
15.5.
Possessions includes the Virgin Islands, Johnston Island, American
Samoa, Guam, Wake Island, Midway Island, and the guano islands, but does
not include Puerto Rico, leased bases, or trust territories.
Senior procurement executive means the individual appointed pursuant
to section 16(3) of the Office of Federal Procurement Policy Act (41
U.S.C. 414(3)) who is responsible for management direction of the
acquisition system of the executive agency, including implementation of
the unique acquisition policies, regulations, and standards of the
executive agency.
Shall denotes the imperative.
Signature or signed means the discrete, verifiable symbol of an
individual which, when affixed to a writing with the knowledge and
consent of the individual, indicates a present intention to authenticate
the writing. This includes electronic systems.
Simplified acquisition procedures means the methods prescribed in
part 13 for making purchases of supplies or services.
Simplified acquisition threshold means $100,000, except that in the
case of any contract to be awarded and performed, or purchase to be
made, outside the United States in support of a contingency operation as
defined in 10 U.S.C. 101(a)(13), the term means $200,000.
Supplies means all property except land or interest in land. It
includes (but is not limited to) public works, buildings, and
facilities; ships, floating equipment, and vessels of every character,
type, and description, together with parts and accessories; aircraft and
aircraft parts, accessories, and equipment; machine tools; and the
alteration or installation of any of the foregoing.
Task order means an order for services placed against an established
contract or with Government sources.
United States, when used in a geographic sense, means the 50 States
and the District of Columbia.
[48 FR 42107, Sept. 19, 1983, as amended at 50 FR 1727, Jan. 11, 1985;
50 FR 4221, Jan. 30, 1985; 50 FR 26903, June 28, 1985; 50 FR 52429, Dec.
23, 1985; 51 FR 2649, Jan. 17, 1986; 52 FR 19802, May 27, 1987; 54 FR
48981, Nov. 28, 1989; 56 FR 41744, Aug. 22, 1991; 60 FR 34736, July 3,
1995; 60 FR 42653, Aug. 16, 1995; 60 FR 48235, Sept. 18, 1995; 61 FR
39190, July 26, 1996; 61 FR 41468, Aug. 8, 1996]
Subpart 2.2--Definitions Clause
Sec. 2.201 Contract clause.
The contracting officer shall insert the clause at 52.202-1,
Definitions, in solicitations and contracts except when the contract is
not expected to exceed the simplified acquisition threshold. If the
contract is for personal services, construction, architect-engineer
services, or dismantling, demolition, or removal of improvements, the
contracting officer shall use the clause with its Alternate I.
Additional definitions may be included, provided they are consistent
with the clause and the FAR.
[60 FR 34744, July 3, 1995, as amended at 61 FR 39190, July 26, 1996]
[[Page 24]]
PART 3--IMPROPER BUSINESS PRACTICES AND PERSONAL CONFLICTS OF INTEREST--Table of Contents
Sec.
3.000 Scope of part.
Subpart 3.1--Safeguards
3.101 Standards of conduct.
3.101-1 General.
3.101-2 Solicitation and acceptance of gratuities by Government
personnel.
3.101-3 Agency regulations.
3.102 [Reserved]
3.103 Independent pricing.
3.103-1 Solicitation provision.
3.103-2 Evaluating the certification.
3.103-3 The need for further certifications.
3.104 Procurement integrity.
3.104-1 General.
3.104-2 Applicability.
3.104-3 Statutory prohibitions and restrictions.
3.104-4 Definitions.
3.104-5 Disclosure, protection, and marking of proprietary and source
selection information.
3.104-6 Restrictions on employment or business opportunity discussions
between competing contractors and procurement officials.
3.104-7 Postemployment restrictions applicable to Government officers
and employees serving as procurement officials and
certifications required from procurement officials leaving
Government service.
3.104-8 Knowing violations, duty to inquire, and ethics advisory
opinions.
3.104-9 Certification requirements.
3.104-10 Solicitation provision and contract clauses.
3.104-11 Processing violations or possible violations.
3.104-12 Ethics program training requirements.
Subpart 3.2--Contractor Gratuities to Government Personnel
3.201 Applicability.
3.202 Contract clause.
3.203 Reporting suspected violations of the Gratuities clause.
3.204 Treatment of violations.
Subpart 3.3--Reports of Suspected Antitrust Violations
3.301 General.
3.302 Definitions.
3.303 Reporting suspected antitrust violations.
Subpart 3.4--Contingent Fees
3.400 Scope of subpart.
3.401 Definitions.
3.402 Statutory requirements.
3.403 Applicability.
3.404 Contract clause.
3.405 Misrepresentations or violations of the Covenant Against
Contingent Fees.
3.406 Records.
Subpart 3.5--Other Improper Business Practices
3.501 Buying-in.
3.501-1 Definition.
3.501-2 General.
3.502 Subcontractor kickbacks.
3.502-1 Definitions.
3.502-2 Subcontractor kickbacks.
3.502-3 Contract clause.
3.503 Unreasonable restrictions on subcontractor sales.
3.503-1 Policy.
3.503-2 Contract clause.
Subpart 3.6--Contracts With Government Employees or Organizations Owned
or Controlled by Them
3.601 Policy.
3.602 Exceptions.
3.603 Responsibilities of the contracting officer.
Subpart 3.7--Voiding and Rescinding Contracts
3.700 Scope of subpart.
3.701 Purpose.
3.702 Definition.
3.703 Authority.
3.704 Policy.
3.705 Procedures.
Subpart 3.8--Limitation on the Payment of Funds to Influence Federal
Transactions
3.800 Scope of subpart.
3.801 Definitions.
3.802 Prohibitions.
3.803 Certification and disclosure.
3.804 Policy.
3.805 Exemption.
3.806 Processing suspected violations.
3.807 Civil penalties.
3.808 Solicitation provision and contract clause.
Subpart 3.9--Whistleblower Protections for Contractor Employees
3.900 Scope of subpart.
3.901 Definitions.
3.902 Applicability.
3.903 Policy.
3.904 Procedures for filing complaints.
[[Page 25]]
3.905 Procedures for investigating complaints.
3.906 Remedies.
Authority: 40 U.S.C. 486(c); 10 U.S.C. Chapter 137; and 42 U.S.C.
2473(c).
Source: 48 FR 42108, Sept. 19, 1983, unless otherwise noted.
Sec. 3.000 Scope of part.
This part prescribes policies and procedures for avoiding improper
business practices and personal conflicts of interest and for dealing
with their apparent or actual occurrence.
Subpart 3.1--Safeguards
3.101 Standards of conduct.
Sec. 3.101-1 General.
Government business shall be conducted in a manner above reproach
and, except as authorized by statute or regulation, with complete
impartiality and with preferential treatment for none. Transactions
relating to the expenditure of public funds require the highest degree
of public trust and an impeccable standard of conduct. The general rule
is to avoid strictly any conflict of interest or even the appearance of
a conflict of interest in Government-contractor relationships. While
many Federal laws and regulations place restrictions on the actions of
Government personnel, their official conduct must, in addition, be such
that they would have no reluctance to make a full public disclosure of
their actions.
Sec. 3.101-2 Solicitation and acceptance of gratuities by Government personnel.
As a rule, no Government employee may solicit or accept, directly or
indirectly, any gratuity, gift, favor, entertainment, loan, or anything
of monetary value from anyone who (a) has or is seeking to obtain
Government business with the employee's agency, (b) conducts activities
that are regulated by the employee's agency, or (c) has interests that
may be substantially affected by the performance or nonperformance of
the employee's official duties. Certain limited exceptions are
authorized in agency regulations.
Sec. 3.101-3 Agency regulations.
(a) Agencies are required by Executive Order 11222 of May 8, 1965,
and 5 CFR part 735 to prescribe Standards of Conduct. These agency
standards contain--
(1) Agency-authorized exceptions to 3.101-2; and
(2) Disciplinary measures for persons violating the standards of
conduct.
(b) Requirements for employee financial disclosure and restrictions
on private employment for former Government employees are in Office of
Personnel Management and agency regulations implementing Public Law 95-
521, which amended 18 U.S.C. 207.
3.102 [Reserved]
3.103 Independent pricing.
Sec. 3.103-1 Solicitation provision.
The contracting officer shall insert the provision at 52.203-2,
Certificate of Independent Price Determination, in solicitations when a
firm-fixed-price contract or fixed-price contract with economic price
adjustment is contemplated, unless--
(a) The acquisition is to be made under the simplified acquisition
procedures in part 13;
(b) [Reserved]
(c) The solicitation is a request for technical proposals under two-
step sealed bidding procedures; or
(d) The solicitation is for utility services for which rates are set
by law or regulation.
[48 FR 42108, Sept. 19, 1983, as amended at 50 FR 1727, Jan. 11, 1985;
50 FR 52429, Dec. 23, 1985; 55 FR 25526, June 21, 1990; 60 FR 34744,
July 3, 1995]
Sec. 3.103-2 Evaluating the certification.
(a) Evaluation guidelines. (1) None of the following, in and of
itself, constitutes disclosure as it is used in subparagraph (a)(2) of
the Certificate of Independent Price Determination (hereafter, the
certificate):
(i) The fact that a firm has published price lists, rates, or
tariffs covering items being acquired by the Government.
(ii) The fact that a firm has informed prospective customers of
proposed or pending publication of new or revised
[[Page 26]]
price lists for items being acquired by the Government.
(iii) The fact that a firm has sold the same items to commercial
customers at the same prices being offered to the Government.
(2) For the purpose of subparagraph (b)(2) of the certificate, an
individual may use a blanket authorization to act as an agent for the
person(s) responsible for determining the offered prices if--
(i) The proposed contract to which the certificate applies is
clearly within the scope of the authorization; and
(ii) The person giving the authorization is the person within the
offeror's organization who is responsible for determining the prices
being offered at the time the certification is made in the particular
offer.
(3) If an offer is submitted jointly by two or more concerns, the
certification provided by the representative of each concern applies
only to the activities of that concern.
(b) Rejection of offers suspected of being collusive. (1) If the
offeror deleted or modified subparagraph (a)(1) or (a)(3) or paragraph
(b) of the certificate, the contracting officer shall reject the
offeror's bid or proposal.
(2) If the offeror deleted or modified subparagraph (a)(2) of the
certificate, the offeror must have furnished with its offer a signed
statement of the circumstances of the disclosure of prices contained in
the bid or proposal. The chief of the contracting office shall review
the altered certificate and the statement and shall determine, in
writing, whether the disclosure was made for the purpose or had the
effect of restricting competition. If the determination is positive, the
bid or proposal shall be rejected; if it is negative, the bid or
proposal shall be considered for award.
(3) Whenever an offer is rejected under subparagraph (1) or (2)
above, or the certificate is suspected of being false, the contracting
officer shall report the situation to the Attorney General in accordance
with 3.303.
(4) The determination made under subparagraph (2) above shall not
prevent or inhibit the prosecution of any criminal or civil actions
involving the occurrences or transactions to which the certificate
relates.
[48 FR 42108, Sept. 19, 1983, as amended at 55 FR 25526, June 21, 1990]
Sec. 3.103-3 The need for further certifications.
A contractor that properly executed the certificate before award
does not have to submit a separate certificate with each proposal to
perform a work order or similar ordering instrument issued pursuant to
the terms of the contract, where the Government's requirements cannot be
met from another source.
3.104 Procurement integrity.
Sec. 3.104-1 General.
(a) Section 3.104 implements section 27 of the Office of Federal
Procurement Policy Act (41 U.S.C. 423), as amended by section 814 of the
FY 90/91 National Defense Authorization Act, Pub. L. 101-189, and
section 815 of the 1991 National Defense Authorization Act, Pub. L. 101-
510 (hereinafter, section 27 is referred to as ``the Act'' or ``the law
as amended.''). Agency supplementation of 3.104 and any clauses required
by 3.104 must be approved at a level not lower than the Senior
Procurement Executive of the agency, unless a higher level of approval
is required by law for that agency.
(b) Agency employees are reminded that much of the conduct
prohibited by the Act is also prohibited by other statutes and
regulations. For example--
(1) The offer or acceptance of a bribe or gratuity is prohibited by
18 U.S.C. 201, 10 U.S.C. 2207, 5 U.S.C. 7353, and 5 CFR parts 735 and
2635;
(2) Employment discussions are covered by 18 U.S.C. 208, which
precludes a Government employee from participating personally and
substantially in any particular matter that would affect the financial
interests of any person with whom the employee is negotiating for
employment;
(3) Post-employment restrictions are covered by 18 U.S.C. 207, which
prohibits certain activities by former Government employees, including
representation of a contractor before the
[[Page 27]]
Government in relation to any contract on which the former employee
worked while employed by the Government; and
(4) FAR parts 14 and 15, which place restrictions on the release of
information related to procurements and other contractor information
which must be protected under 18 U.S.C. 1905. In addition, 5 CFR part
735 protects non-public Government information.
[55 FR 36784, Sept. 6, 1990, as amended at 55 FR 49853, Nov. 30, 1990]
Sec. 3.104-2 Applicability.
(a) Conduct and procurement activities during the period July 16,
1989, through November 30, 1989--(1) Gratuities, employment discussions,
and soliciting, obtaining, or disclosing proprietary or source selection
information. (i) Participation in a procurement during the period July
16, 1989, through November 30, 1989, whether as a procurement official,
competing contractor or through access to information, subjects the
participant, during that period, to the prohibitions contained in
section 27 as originally enacted.
(ii) If a particular procurement which was begun during the period
July 16, 1989, through November 30, 1989, has not been completed by
November 30, 1990, then on or after December 1, 1990:
(A) Any person who was subject to the prohibitions on disclosing
proprietary or source selection information contained in subsection
27(c) of the law as originally enacted is subject to the disclosure
prohibitions of subsection 27(d) of the law as amended;
(B) Except as provided in subdivision (a)(1)(ii)(A) of this
subsection, a procurement official who was subject to the prohibitions
on gratuities, employment discussions, and disclosing proprietary or
source selection information contained in subsection 27(b) of the law as
originally enacted is subject to the prohibitions under subsection 27(b)
of the law as amended, if the activities performed by the procurement
official prior to December 1, 1989, would also make him or her a
procurement official under subsection 27(b) of the law as amended; and
(C) Except as provided in subdivision (a)(1)(ii)(A) of this
subsection, a competing contractor who was subject to the prohibitions
on gratuities, employment discussions, and soliciting or obtaining
proprietary or source selection information contained in subsection
27(a) of the law as originally enacted is subject to the prohibitions
under subsection 27(a) of the law as amended if it is still a competing
contractor for that procurement on or after December 1, 1990.
(2) Post-employment restrictions. (i) Current and former Government
employees who were procurement officials during the period July 16,
1989, through November 30, 1989, are subject, during that period, to the
post-employment restrictions contained in section 27 as originally
enacted.
(ii) On or after June 1, 1991, current and former Government
employees who were procurement officials during the period July 16,
1989, through November 30, 1989, become subject to the post-employment
restrictions contained in subsection 27(f) of the law as amended, if:
(A) The activities performed by the procurement official during the
period July 16, 1989, through November 30, 1989, would also make him or
her a procurement official under section 27, of the law as amended; and
(B) The 2-year period of any post-employment restriction that
attached during the period July 16, 1989, through November 30, 1989, has
not expired.
(b) Conduct and procurement activities during the period December 1,
1989, through November 30, 1990--(1) Gratuities, employment discussions,
and soliciting, obtaining, or disclosing proprietary or source selection
information. (i) The prohibitions on gratuities, employment discussions,
and soliciting, obtaining, or disclosing proprietary or source selection
information contained in section 27 were suspended during the period
December 1, 1989, through November 30, 1990. Neither the prohibitions
contained in section 27 as originally enacted nor as amended apply
during the suspension period. Participation in a procurement solely
during the suspension period does not subject any person to any of these
prohibitions on or after December 1, 1990.
(2) Post-employment restrictions. (i) The post-employment
restrictions contained in section 27 were suspended during the period
December 1, 1989,
[[Page 28]]
through November 30, 1990. Neither the post-employment restrictions
contained in section 27 as originally enacted nor as amended apply to
any person during the suspension period. In addition, these post-
employment restrictions do not apply on or after December 1, 1990, to
any current or former Government employee whose only participation in a
procurement occurred during the period from December 1, 1989, through
November 30, 1990.
(ii) The suspension of the post-employment restrictions during the
period December 1, 1989, through November 30, 1990, does not interrupt
the running of the 2-year period of any post-employment restriction that
attached to a Government employee who was a procurement official during
the period July 16, 1989, through November 30, 1989.
(c) Conduct and procurement activities on or after December 1,
1990--(1) Gratuities, employment discussions, and soliciting, obtaining,
or disclosing proprietary or source selection information. (i) The
prohibitions contained in section 27, of the law as amended, apply on or
after December 1, 1990, to persons who participate in a procurement on
or after that date, whether as a procurement official, a competing
contractor, or through access to information.
(ii) As provided in subdivision (a)(1)(ii) of this subsection, the
prohibitions contained in section 27, of the law as amended, may also
apply to procurement officials, competing contractors, and other persons
who, during the period July 16, 1989, through November 30, 1989, were
subject to the prohibitions of section 27 as originally enacted.
(2) Post-employment restrictions. (i) Public Law 101-510 continues
the suspension of the post-employment restrictions contained in
subsection 27(f) of the law as amended through May 31, 1991. Government
employees who perform procurement official activities solely during the
period December 1, 1990, through May 31, 1991, do not become subject to
the post-employment restrictions contained in subsection 27(f) of the
law as amended either during or after the suspension period.
(ii) The post-employment restrictions of subsection 27(f) of the law
as amended are effective June 1, 1991. Government employees who perform
procurement official activities on or after June 1, 1991, are subject to
those restrictions.
(iii) As provided in subdivision (a)(2)(ii) of this subsection, the
post-employment restrictions contained in subsection 27(f) of the law as
amended may also apply, on or after June 1, 1991, to current or former
Government employees who were procurement officials during the period
July 16, 1989, through November 30, 1989.
(iv) The continued suspension of the post-employment restrictions
does not interrupt the running of the 2-year period of any post-
employment restriction that attached to a procurement official during
the period July 16, 1989, through November 30, 1989.
[55 FR 49853, Nov. 30, 1990]
Sec. 3.104-3 Statutory prohibitions and restrictions.
As provided in section 27 of the Act, the following conduct is
prohibited:
(a) Prohibited conduct by competing contractors (subsection 27(a) of
the Act). During the conduct of any Federal agency procurement of
property or services, no competing contractor or any officer, employee,
representative, agent, or consultant of any competing contractor shall
knowingly--
(1) Make, directly or indirectly, any offer or promise of future
employment or business opportunity to, or engage, directly or
indirectly, in any discussion of future employment or business
opportunity with, any procurement official of such agency, except as
provided in 3.104-6(b);
(2) Offer, give, or promise to offer or give, directly or
indirectly, any money, gratuity, or other thing of value to any
procurement official of such agency; or
(3) Solicit or obtain, directly or indirectly, from any officer or
employee of such agency, prior to the award of a contract any
proprietary or source selection information regarding such procurement.
(b) Prohibited conduct by procurement officials (subsection 27(b) of
the Act). During the conduct of any Federal agency procurement of
property or services, no procurement official of such agency shall
knowingly--
[[Page 29]]
(1) Solicit or accept, directly or indirectly, any promise of future
employment or business opportunity from, or engage, directly or
indirectly, in any discussion of future employment or business
opportunity with, any officer, employee, representative, agent, or
consultant of a competing contractor, except as provided in 3.104-6(a);
(2) Ask for, demand, exact, solicit, seek, accept, receive, or agree
to receive, directly or indirectly, any money, gratuity, or other thing
of value from any officer, employee, representative, agent, or
consultant of any competing contractor for such procurement; or
(3) Disclose any proprietary or source selection information
regarding such procurement directly or indirectly to any person other
than a person authorized by the head of such agency or the contracting
officer to receive such information.
(c) Disclosure to unauthorized persons (subsection 27(d) of the
Act). During the conduct of any Federal agency procurement of property
or services, no person who is given authorized or unauthorized access to
proprietary or source selection information regarding such procurement,
shall knowingly disclose such information, directly or indirectly, to
any person other than a person authorized by the head of such agency or
the contracting officer to receive such information.
(d) Post-employment Restrictions resulting from procurement
activities of Government officers or employees who are or were
procurement officials (subsection 27(f) of the Act; not effective until
June 1, 1991). (1) No individual who, while serving as an officer or
employee of the Government or member of the Armed Forces, was a
procurement official with respect to a particular procurement may
knowingly--
(i) Participate in any manner, as an officer, employee, agent, or
representative of a competing contractor, in any negotiations leading to
the award, modification, or extension of a contract for such
procurement; or
(ii) Participate personally and substantially on behalf of the
competing contractor in the performance of such contract.
The restrictions in subdivisions (d)(1)(i) and (d)(1)(ii) of this
subsection apply during the period ending 2 years after the last date
such individual participated personally and substantially in the conduct
of such procurement or personally reviewed and approved the award,
modification, or extension of any contract for such procurement.
(2) This subsection does not apply to any participation referred to
in subdivisions (d)(1)(i) and (d)(1)(ii) of this subsection with respect
to a subcontractor who is a competing contractor unless--
(i) The subcontractor is a first or second tier subcontractor and
the subcontract is for an amount that is in excess of $100,000; or
(ii) The subcontractor significantly assisted the prime contractor
with respect to negotiation of the prime contract; or
(iii) The procurement official involved in the award, modification,
or extension of the prime contract personally directed or recommended
the particular subcontractor to the prime contractor as a source for the
subcontract; or
(iv) The procurement official personally reviewed and approved the
award, modification, or extension of the subcontract.
[55 FR 36784, Sept. 6, 1990, as amended at 55 FR 49854, Nov. 30, 1990]
Sec. 3.104-4 Definitions.
As used in this subsection--
(a) Agency ethics official means the designated agency ethics
official described in 5 CFR 2638.201 and any other person, including
deputy ethics officials described in 5 CFR 2638.204, to whom authority
under 3.104-6(f) and 3.104-8(e) has been delegated by the designated
agency ethics official.
(b)(1) Competing contractor, with respect to any procurement
(including any procurement using procedures other than competitive
procedures) of property or services means any entity (such as an
individual, partnership, corporation, educational institution, nonprofit
or not for profit organization, or business unit) legally capable of
entering into a contract or subcontract in its own name that is, or is
[[Page 30]]
reasonably likely to become, a competitor for or recipient of a contract
or subcontract under such procurement, and includes any other person
acting on behalf of such an entity.
(2) The term competing contractor includes the incumbent contractor
in the case of a contract modification.
(3) An entity shall not be considered a competing contractor
whenever, by action of the Government or the entity, it is clear that
the entity will not, or will no longer, participate in a particular
procurement.
(4) For purposes of subsections 27(a) and 27(b) of the Act, the
phrase representative, agent, or consultant of a competing contractor
means any entity, other than an officer or employee of a competing
contractor, acting on behalf of, or providing advice to, a competing
contractor with regard to a particular Federal agency procurement.
(c)(1) During the conduct of any Federal agency procurement of
property or services means, except for broad agency announcements, small
business innovative research programs, and unsolicited proposals (see
subparagraphs (c)(3) and (c)(4) of this subsection), the period
beginning on the earliest date upon which an identifiable, specific
action is taken for the particular procurement and concluding upon the
award or modification of a contract or the cancellation of the
procurement; provided, however, that in no event shall the conduct of
the procurement be deemed to have begun prior to the decision by an
authorized agency official to satisfy a specific agency need or
requirement by procurement. These actions are--
(i) Drafting a specification or a statement of work;
(ii) Review and approval of a specification;
(iii) Requirements computation at an inventory control point;
(iv) Development of procurement or purchase requests;
(v) Preparation or issuance of a solicitation;
(vi) Evaluation of bids or proposals;
(vii) Selection of sources;
(viii) Conduct of negotiations; or
(ix) Review and approval of the award of a contract or contract
modification.
(2) Each contract award and each contract modification constitutes a
separate procurement action, i.e., a separate period to which the
prohibitions and the requirements of the Act apply.
(3) For broad agency announcements and small business innovative
research programs, each proposal received by an agency shall constitute
a separate procurement for purposes of the Act. The conduct of each
procurement shall be deemed to have begun upon the date a Commerce
Business Daily announcement was made regarding the availability of the
broad agency announcement or the date a solicitation was released for
the small business innovative research program. The conduct of the
procurement shall end upon the award of a contract or contract
modification incident to each proposal or the written rejection of each
specific proposal.
(4) Each unsolicited proposal shall be considered a separate
procurement for purposes of the Act. For unsolicited proposals, the
conduct of the procurement shall be deemed to have begun upon the
publication date of a general statement of agency needs (see 15.503(d)),
or if an agency does not publicize a general statement of agency needs,
upon the provision of advance guidance related to agency needs (see
15.504(a)(1)) or the receipt of the unsolicited proposal, whichever is
earlier. The conduct of the procurement shall end upon the award of a
contract or contract modification or the rejection of the proposal.
(d) Government officer or employee means a person who is employed by
a Federal agency (see subpart 2.1) and who is in such status during the
period July 16, 1989 through November 30, 1989, or on or after December
1, 1990. This includes--
(1) A member of the uniformed services as defined in section 101(3)
of title 37 U.S.C.;
(2) A person who is appointed to a position in the Federal
Government under title 5 U.S.C., or any other title authorizing such
appointments, including a person under a temporary appointment; and
(3) A special Government employee as defined in section 202 of title
18 U.S.C.
[[Page 31]]
(e) Modification means the addition of new work to a contract, or
the extension of a contract, which requires a justification and approval
(see subpart 6.3). It does not include an option where all the terms of
the option, including option prices, are set forth in the contract and
all requirements for option exercise have been satisfied, change orders,
administrative changes, or any other contract changes that are within
the scope of the contract.
(f)(1) Gratuity or other thing of value includes any gift, favor,
entertainment, or other item having monetary value. The phrase includes
services, conference fees, vendor promotional training, transportation,
lodgings and meals, as well as discounts not available to the general
public and loans extended by anyone other than a bank or financial
institution. The phrase does not include--
(i) Anything for which market value is paid by the procurement
official, or on his behalf, by someone other than a competing
contractor, or a representative, agent, or consultant of the competing
contractor;
(ii) Anything which is paid for by the Government, secured under
Government contract, or accepted by the Government under specific
statutory authority;
(iii) Plaques or certificates having no intrinsic value; or
(iv) Any unsolicited item, other than money, having a market value
of $10 or less per event or presentation.
For these purposes, market value means the retail cost the procurement
official would incur to purchase the item and, in the case of items such
as tickets, refers to their face value. A thing of value given or
received or otherwise offered or sought directly or indirectly includes
a thing of value directed to a person other than a procurement official,
such as a spouse or child, solely because of that person's relationship
to the procurement official or on the basis of designation,
recommendation, or suggestion by the procurement official.
(2) Promotional vendor training does not include training provided
by a vendor when a vendor's products are furnished under contract to the
Government and the training is to facilitate the use of those products.
(g) Participated personally and substantially means active and
significant involvement of the individual in activities directly related
to the procurement. To participate personally means directly, and
includes the participation of a subordinate when actually directed by
the supervisor in the matter. To participate substantially means that
the employee's involvement must be of significance to the matter. For
example, the review of procurement documents solely to determine
compliance with applicable regulatory, administrative, or budgetary
requirements or procedures does not constitute substantial participation
in a procurement. It requires more than official responsibility,
knowledge, perfunctory involvement, or involvement on an administrative
or peripheral issue. A finding of substantiality should be based not
only on the effort devoted to a matter, but on the importance of the
effort. While a series of peripheral involvements may be insubstantial,
the single act of approving or participating in a critical step may be
substantial.
(h)(1) Procurement official means any civilian or military official
or employee of an agency who has participated personally and
substantially in any of the following activities for a particular
procurement--
(i) Drafting a specification or a statement of work for that
procurement;
(ii) Review and approval of a specification or statement of work
developed for that procurement;
(iii) Preparaton or development of procurement or purchase requests
for that procurement;
(iv) The preparation or issuance of a solicitation for that
procurement;
(v) Evaluation of bids or proposals for that procurement;
(vi) Selection of sources for that procurement;
(vii) Negotiations to establish the price or terms and conditions of
a particular contract or contract modification; or
(viii) Review and approval of the award of a contract or contract
modification.
(2) For purposes of 3.104-4(h), the term employee of an agency
includes a
[[Page 32]]
contractor, subcontractor, consultant, expert, or advisor (other than a
competing contractor) acting on behalf of, or providing advice to, the
agency with respect to any phase of the agency procurement concerned.
(3) Generally, an individual will not become a procurement official
solely by participating in the following activities--
(i) Federal advisory committees that are established and function in
accordance with the Federal Advisory Committee Act, 5 U.S.C. app. 2,
unless the Federal advisory committee is established or used for the
purpose of performing a function listed in subparagraph (h)(1) of this
subsection and the individual member's participation in that function is
personal and substantial;
(ii) Agency level boards, panels, or other advisory committees that
review program milestones or evaluate and make recommendations regarding
alternative technologies or approaches for satisfying broad agency level
missions or objectives;
(iii) The performance of general, technical, engineering, or
scientific effort having broad application not directly associated with
a particular procurement, notwithstanding that such general, technical,
engineering, or scientific effort subsequently may be incorporated into
a particular procurement;
(iv) Clerical functions supporting the conduct of a particular
procurement; and
(v) For procurements to be conducted under the procedures of OMB
Circular A-76, participation in management studies, preparation of in-
house cost estimates, preparation of most efficient organization
analyses, and furnishing of data or technical support to be used by
others in the development of performance standards, statements of work,
or specifications.
(4) An employee of an agency does not become a procurement official
for a particular procurement until the onset of the employee's personal
and substantial participation in that particular procurement.
(5) For purposes of 3.104-4(h), the term procurement official does
not include contracting officers or other individuals whose authority is
limited to the micro-purchase threshold if the head of the contracting
activity determines that it is unlikely that the individual will make
purchases in a total amount greater than $20,000 in any 12-month period.
(i) Property means supplies as defined in 2.101.
(j)(1) Proprietary information means information contained in a bid
or proposal or otherwise submitted to the Government by a competing
contractor in response to the conduct of a particular Federal agency
procurement, or in an unsolicited proposal, that has been marked by the
competing contractors as proprietary information in accordance with
applicable law and regulation.
(2) Information shall be considered proprietary information, for
purposes of section 27 of the Act, only when--
(i) An attached transmittal document, such as a cover page or the
label of a magnetic media storage container, is clearly marked with a
restrictive legend; and
(ii) The specific portions of the information whose disclosure the
competing contractor desires to restrict are clearly and separately
marked.
(3) Proprietary information does not include information--
(i) That is otherwise available without restrictions to the
Government, another competing contractor, or the public;
(ii) Contained in bid documents following bid opening (but see
14.404-4); or
(iii) That the contracting officer determines to release in
accordance with 3.104-5(d).
(k)(1) Source selection information is information, including
information stored in electronic, magnetic, audio or video formats,
which is prepared or developed for use by the Government to conduct a
particular procurement and--
(i) The disclosure of which to a competing contractor would
jeopardize the integrity or successful completion of the procurement
concerned; and
(ii) Is required by statute, regulation, or order to be secured in a
source selection file or other facility to prevent disclosure.
[[Page 33]]
(2) Source selection information is limited to--
(i) Bid prices submitted in response to a Federal agency
solicitation for sealed bids, or lists of those bid prices prior to
public bid opening;
(ii) Proposed costs or prices submitted in response to a Federal
agency solicitation (for other than sealed bids), or lists of those
proposed costs or prices;
(iii) Source selection plans;
(iv) Technical evaluation plans;
(v) Technical evaluations of proposals;
(vi) Cost or price evaluations of proposals;
(vii) Competitive range determinations which identify proposals that
have a reasonable chance of being selected for award of a contract;
(viii) Rankings of bids, proposals, or competitors;
(ix) The reports and evaluations of source selection panels or
boards or advisory councils; or
(x) Other information marked as ``SOURCE SELECTION INFORMATION--SEE
FAR 3.104'' based upon a case-by-case determination by the Head of the
Agency, his designee, or the contracting officer that the information
meets the standards in subdivisions (k)(1) (i) and (ii) of this
subsection.
(l) Possible violation means, for purposes of the certification
requirements under 3.104-9, specifically identified or documented
circumstances that provide a reasonable basis to believe that a
violation of the Act may have occurred. Rumor and hearsay are not, by
themselves, a reasonable basis to conclude that a possible violation
exists.
[55 FR 36785, Sept. 6, 1990, as amended at 55 FR 49854, Nov. 30, 1990;
59 FR 64787, Dec. 15, 1994; 61 FR 39191, July 26, 1996]
Sec. 3.104-5 Disclosure, protection, and marking of proprietary and source selection information.
(a) Except as specifically provided for in this subsection, no
person or other entity may disclose proprietary or source selection
information to any person other than a person authorized by the Head of
the Agency to receive such information. A person or entity who does not
know if information is proprietary or source selection information, or
does not know if the person or entity may disclose or receive such
information, shall make the inquiries prescribed at 3.104-8(d).
(b)(1) Proprietary and source selection information shall be
protected from unauthorized disclosure in accordance with 14.401,
15.411, 15.413, applicable law, and agency regulations.
(2) Information contained in a bid or proposal that bears the legend
required by 3.104-4(j)(2) shall be considered to be proprietary
information for purposes of the Act. However, information contained in a
bid or proposal that does not bear that legend shall remain subject to
the restrictions on disclosure contained in 15.413, 15.509, 24.202, or
as otherwise required by law.
(c) In determining whether particular information is source
selection information under 3.104-4(k)(2)(x), the originator shall
assure that the information meets the criteria in 3.104-4(k)(1) and
consult with agency officials as appropriate. Individuals responsible
for preparing material that may include information designated as source
selection information in accordance with 3.104-4 (k)(2)(x) shall mark
the cover page and each page that contains source selection information
with the legend ``SOURCE SELECTION INFORMATION--SEE FAR 3.104.''
Although the material described in 3.104-4(k)(2) (i) through (ix) is
considered to be source selection information whether or not marked, all
reasonable efforts shall be made to mark such material with this legend.
(d)(1) The head of the agency, or his or her designee, or the
contracting officer, has the authority, in accordance with applicable
agency regulations or procedures, to authorize persons, or classes of
persons, to receive proprietary or source selection information when
necessary to the conduct of the procurement.
(2) For contracts and contract modifications in excess of $100,000,
the head of the agency, or his or her designee, shall establish
procedures to assure that the names of all persons, identification of
the classes of persons and, to the maximum extent practicable, the names
of all individuals within a class of persons, authorized access to
[[Page 34]]
proprietary or source selection information at the contracting activity
are listed in the contract file.
(3) For contracts and contract modifications expected to exceed
$100,000, if proprietary or source selection information is authorized
to be released to Government activities outside the contracting activity
responsible for the conduct of the procurement, the head of the office
receiving the information, or his or her designee, shall maintain a list
of persons, a list of classes of persons and, to the maximum extent
practicable, the names of all individuals within classes of persons, who
have been authorized access to the proprietary or source selection
information. The list shall be forwarded to the contracting office
responsible for the conduct of the procurement to be included in the
contract file.
(4) For release to other than Government employees, see 15.413-2.
The names of those individuals shall also be listed in the contract file
when the contract or contract modification is expected to exceed
$100,000.
(5) The lists prescribed by this subsection shall be forwarded to
the contracting officer for inclusion in the contract file within the
time specified by the contracting officer.
(e)(1) Except as provided in subparagraph (e)(4) of this subsection,
if the contracting officer believes that information marked as
proprietary (see 3.104-4(j)) is not proprietary, the competing
contractor that has affixed the marking shall be notified in writing and
given an opportunity to justify the proprietary marking. If the
competing contractor agrees that the material is not proprietary
information, or does not respond within the time specified in the
notice, the contracting officer may remove the proprietary marking and
the information may be released.
(2) After reviewing any justification submitted by the competing
contractor, if the contracting officer determines that the proprietary
marking is not justified, the contracting officer shall so notify the
competing contractor in writing.
(3) Information marked by the competing contractor as proprietary
shall not be released until--
(i) The review of the contractor's justification has been completed;
or
(ii) The period specified for the contractor's response has elapsed,
whichever is earlier.
Thereafter, the contracting officer may release the information.
(4) With respect to technical data that are marked proprietary by a
competing contractor, the contracting officer shall generally follow the
procedures in 27.404(h).
(f) Nothing in 3.104 prohibits competing contractors from disclosing
or authorizing the Government to disclose their company-specific
proprietary information to any other person or entity where not
otherwise prohibited by law.
(g) Proprietary markings under 3.104 do not limit the Government's
use of technical data to which the Government has rights.
(h) Source selection or proprietary information that is properly in
the possession of a competing contractor as a result of a prior
disclosure that was not prohibited by the Act shall not be considered to
have been solicited or obtained, directly or indirectly, in violation of
the Act.
(i) Nothing in 3.104 shall be construed to authorize the withholding
of any information pursuant to a proper request from the Congress, any
committee or subcommittee thereof, a Federal agency, any board of
contract appeals of a Federal agency, the Comptroller General, or an
Inspector General of a Federal agency, except as otherwise authorized by
law or regulation. Any such release which contains proprietary or source
selection information shall clearly notify the recipient that the
information or portions thereof are proprietary or source selection
information related to the conduct of a Federal agency procurement whose
disclosure is restricted by section 27 of the Act.
[55 FR 36787, Sept. 6, 1990]
Sec. 3.104-6 Restrictions on employment or business opportunity discussions between competing contractors and procurement officials.
(a) Applicability to procurement officials. During the conduct of a
Federal agency procurement, subsection
[[Page 35]]
27(b)(1) of the Act prohibits an individual who has become a procurement
official from knowingly, directly or indirectly, soliciting or accepting
from or discussing with any officer, employee, representative, agent, or
consultant of a competing contractor, future employment or business
opportunity. Subsection 27(b)(1) of the Act also applies to individuals
acting as procurement officials on behalf of the procuring agency who
are, or are employed by, contractors, subcontractors, consultants,
experts, or advisors (other than employees of a competing contractor).
The prohibition in subsection 27(b)(1) does not apply to a procurement
official--
(1) After the contract has been awarded, the procurement canceled,
or the contract modification has been executed;
(2) After the procurement official leaves Government service;
(3) Who is, or is employed by, a contractor, subcontractor,
consultant, expert, or advisor, after such procurement official ceases
to act on behalf of, or provide advice to, the procuring agency
concerning the procurement;
(4) Described in paragraph (c) of this subsection who has received
written authorization for recusal from further participation in a
procurement, and who has in fact discontinued participation in the
procurement.
(5) Whose only communication with a competing contractor is for the
purpose of--
(i) Rejecting an unsolicited offer of employment or business
opportunity; or
(ii) Advising the competing contractor that he or she must seek
recusal in accordance with paragraph (d) of this subsection prior to any
discussions regarding the unsolicited offer. A procurement official who
wishes to conduct such discussions with the competing contractor shall
promptly submit a recusal proposal.
(b) Applicability to competing contractors. During the conduct of a
Federal agency procurement, subsection 27(a)(1) of the Act prohibits a
competing contractor from knowingly, directly or indirectly, offering or
promising to, or discussing with, a procurement official any future
business or employment opportunity. The prohibition does not apply to--
(1) An initial contact for the sole purpose of determining whether
an individual or other entity is able to engage in discussions
concerning future employment or business opportunity either because the
individual or entity has been recused or is not a procurement official.
(2) A contact or discussion with an individual or other entity who
may engage in such contact or discussion under subparagraphs (a)(1)
through (a)(4) of this subsection.
(c) Eligibility for recusal. An individual or other entity who is a
procurement official may be eligible for recusal if the individual or
entity has not participated personally and substantially in--
(1) The evaluation of bids or proposals, the selection of sources,
or the conduct of negotiations in connection with such solicitation or
contract during the period beginning with the issuance of a procurement
solicitation and ending with the award of a contract or cancellation of
a procurement; or
(2) The evaluation of a proposed modification, or the conduct of
negotiations during the period beginning with the negotiation of a
modification of a contract and ending with an agreement to modify the
contract or a decision not to modify the contract.
(d) Recusal proposal. An eligible procurement official who wishes to
discuss future employment or business opportunities with a competing
contractor during the conduct of a procurement shall submit to the Head
of the Contracting Activity (HCA), or his or her designee, prior to
initiating or engaging in such discussions, a written proposal of
disqualification from further participation in the procurement which
relates to that competing contractor. Concurrent copies of the written
proposal shall be submitted to the contracting officer, the Source
Selection Authority if the contracting officer is not the Source
Selection Authority, and the procurement official's immediate
supervisor. As a minimum, the proposal shall--
(1) Identify the procurement involved;
[[Page 36]]
(2) Describe the nature of the procurement official's participation
in the procurement and specify the approximate dates or time period of
participation; and
(3) Identify the competing contractor and describe its interest in
the procurement.
(e) Suspension from participation in a procurement. The contracting
officer, or the Source Selection Authority if the contracting officer is
not the Source Selection Authority, may suspend the individual's or
entity's participation in the procurement pending evaluation of the
recusal proposal. Notwithstanding submission of a recusal proposal or
suspension from participation in a procurement, an individual or entity
shall not solicit or engage in discussions of employment or business
opportunity until authorized in writing by the HCA or his or her
designee.
(f) Evaluation of recusal proposal. (1) If the HCA or his or her
designee determines that the procurement official's further
participation is not essential to the activity's conduct of the
procurement and that recusal will not jeopardize the integrity of the
procurement process, the HCA may, after consulting with the agency
ethics official, grant written approval of the recusal proposal. In
evaluating the recusal proposal, the HCA or his or her designee may
consider any relevant factors, including--
(i) The importance of the procurement official's role to the
completion of the procurement action;
(ii) The procurement official's prior participation in key
procurement decisions and actions;
(iii) The timing of the proposal in relation to significant
procurement milestones; and
(iv) Potential disruption to the procurement schedule as a result of
the procurement official's recusal.
(2) The HCA or his or her designee may request that any person,
including the procurement official, the Source Selection Authority, the
contracting officer or the procurement official's immediate supervisor,
provide any additional information necessary to evaluate the recusal
proposal.
(3) Any rejection of the recusal proposal shall be in writing and
shall state the basis for rejection. A determination by the HCA or his
or her designee to reject a recusal proposal shall be final. Rejection
of a Government officer's or employee's recusal proposal shall not be
deemed to be an adverse personnel action or be subject to agency or
negotiated grievance procedures.
(g) Duration of recusal. A procurement official whose recusal
proposal has been approved shall be disqualified--
(1) As a minimum, for any period during which future employment or
business opportunities with the competing contractor have not been
rejected by either the procurement official or the competing contractor;
or
(2) For the period the procurement official and competing contractor
have an employment or business relationship or an arrangement concerning
future employment or business relationships.
(h) Reinstatement to participation in a procurement. Subsequent to a
period of disqualification, if an agency wishes to reinstate the
procurement official to participation in the procurement, the HCA or his
or her designee may authorize immediate reinstatement or, in his or her
discretion, may authorize reinstatement following whatever additional
period of disqualification he or she determines is necessary to ensure
the integrity of the procurement process. It is within the discretion of
the HCA, or his or her designee, to determine that the procurement
official shall not be reinstated to participation in the procurement. In
determining that any additional period of disqualification is necessary,
the HCA or his or her designee shall consider any factors that might
give rise to an appearance that the procurement official acted without
complete impartiality with respect to issues involved in the
procurement.
[55 FR 36788, Sept. 6, 1990]
Sec. 3.104-7 Postemployment restrictions applicable to Government officers and employees serving as procurement officials and certifications required from
procurement officials leaving Government service.
(a) Subsection 27(e)(4) of the Act provides that if a procurement
official
[[Page 37]]
leaves the Government during the conduct of a procurement expected to
result in a contract or modification in excess of $100,000, such
official shall certify to the contracting officer that he or she
understands the continuing obligation, during the conduct of the
procurement, not to disclose propriety or source selection information
related to such agency procurement. This certification requirement also
applies to individuals acting as procurement officials on behalf of the
procuring activity who are, or are employed by, contractors,
subcontractors, consultants, experts, or advisors other than employees
of the competing contractor when such individuals, during the conduct of
the procurement, cease to function as procurement officials for the
procurement.
(b) Subsection 27(f)(1)(A) of the Act restricts a current or former
Government officer or employee, as defined in 3.104-4(d), who was a
procurement official with respect to a particular procurement, from
knowingly participating in any manner in negotiations as an officer,
employee, representative, agent, or consultant of a competing contractor
leading to the award or modification of the contract for such
procurement. This restriction not only includes representing the
competing contractor in negotiations with the contracting activity, but
also includes providing advice or information for the specific purpose
of influencing negotiation strategies. For purposes of this restriction,
``negotiation strategies'' mean the contractor's approach to the
preparation and presentation of its offer or the conduct of negotiations
with the Government. This restriction does not apply to providing
scientific, technical, or other advice that is unrelated to negotiation
strategies. This restriction lasts for 2 years from the date of the
individual's last personal and substantial participation in the Federal
agency procurement. This restriction is not effective until June 1,
1991.
(c) Subsection 27(f)(1)(B) of the Act restricts a current or former
Government officer or employee, as defined in 3.104-4(d), who was a
procurement official with respect to a particular procurement, from
knowingly participating personally and substantially on behalf of the
competing contractor in performance of the contract. To participate
``personally and substantially'' requires the presence of both direct
and significant involvement in the performance of the specific contract.
The performance of general engineering, scientific or technical work, or
providing general budgetary or policy advice, shall not be considered
personal and substantial participation on behalf of a competing
contractor in the performance of the contract for which the Government
officer or employee is or was a procurement official. Where
participation is on behalf of a competing contractor who is a
subcontractor, the significance of that participation will be determined
in relation to the prime contract. This restriction lasts for 2 years
from the date of the last personal and substantial participation in the
Federal agency procurement. This restriction is not effective until June
1, 1991.
(d) The restrictions in paragraphs (b) and (c) of this subsection do
not apply to--
(1) Individuals acting as procurement officials on behalf of the
procuring agency who are or were, or who are or were employed by,
contractors, subcontractors, consultants, experts, or advisors and who
are not Government officers or employees as defined in 3.104-4(d).
(2) Participation in the negotiation or performance of any other
contract of the competing contractor.
(3) General scientific and technical work on an independent research
and development project, unless such work involves the negotiation or
performance of a specific contract that the individual worked on as a
Government employee.
(4) Participation with respect to a subcontractor who is a competing
contractor unless--
(i) The subcontractor is a first or second tier subcontractor and
the subcontract is for an amount that is in excess of $100,000; or
(ii) The subcontractor significantly assisted the prime contractor
with respect to negotiation of the prime contract; or
(iii) The procurement official involved in the award or modification
of
[[Page 38]]
the prime contract personally directed or recommended the particular
subcontractor as a source for the subcontract; or
(iv) The procurement official personally reviewed and approved the
award or modification of the subcontract. A contracting officer's
consent, in accordance with part 44, to the placement of a subcontract
or, with respect to architect-engineer contracts, the substitution of a
subcontractor, associate, or consultant, does not constitute approval of
the subcontract, subcontractor, associate, or consultant. Similarly,
approval of a contractor's purchasing system does not constitute
approval of a particular subcontract or subcontractor.
(5) An individual who has been granted a waiver by the President in
accordance with subsection 27(f)(3) of the Act. Waivers under that
subsection may be granted only to a civilian officer or employee of the
Executive branch other than an officer and employee in the Executive
Office of the President who, after his or her Federal Government
employment is terminated, is or will be engaged in activities at a
Government-owned, contractor-operated entity at which he or she served
as an officer or employee immediately before his or her Federal
Government employment began. Subsection 27(f)(3) is not effective until
June 1, 1991.
(6) An individual whose only personal and substantial participation
in the procurement occurred during the period December 1, 1989, through
May 31, 1991.
[55 FR 36789, Sept. 6, 1990, as amended at 55 FR 49854, Nov. 30, 1990]
Sec. 3.104-8 Knowing violations, duty to inquire, and ethics advisory opinions.
(a) Knowing violations. Neither a procurement official nor a
competing contractor violates the restrictions set forth in 3.104-3
unless the prohibited conduct is engaged in knowingly. For these
purposes, conduct is not knowing when--
(1) A competing contractor engages in specific conduct after having
satisfied the duty to inquire under paragraphs (b), (c), and (d) of this
subsection, or when the competing contractor engages in conduct based
upon good faith reliance on an agency ethics advisory opinion issued to
a current or former procurement official under paragraph (e) of this
subsection.
(2) A procurement official engages in specific conduct after having
satisfied the duty to inquire under paragraphs (b), (c), and (d) of this
subsection or has acted in good faith reliance on an ethics advisory
opinion obtained under paragraph (e) of this subsection.
(b) Duty to inquire--general. (1) For some procurements, neither
competing contractors nor all procurement officials will have knowledge
as to when the conduct of a particular procurement has begun. However,
certain conduct and activities that are prohibited by the Act would be
inappropriate at any time. There are prohibitions on the receipt of
gratuities from agency contractors that apply without regard to whether
an employee is involved in the conduct of a particular procurement.
Similarly, potential contractors should not solicit, and agency
personnel should not offer, proprietary or source selection information
at any time. However, potential contractors may offer, and Government
employees may solicit, employment except as prohibited by law.
(2) Agency personnel shall be presumed to know the procurements for
which they are procurement officials. Contractor personnel are presumed
to know the procurements for which the organization they represent is
reasonably likely to be competing. Individuals who do not know whether
they are procurement officials, or whether the organization they
represent is or is reasonably likely to become a competing contractor,
should defer any discussions regarding employment until these questions
are resolved by consulting appropriate parties within their respective
organizations. Agency personnel who cannot ascertain, after discussions
with the contracting officer, or the Source Selection Authority if the
contracting officer is not the Source Selection Authority, whether they
are procurement officials, may request an ethics advisory opinion under
paragraph (e) of this subsection for purposes of determining their
status.
(b) Duty to inquire--employment discussions. (1) A contractor who
wishes to
[[Page 39]]
discuss employment opportunities with an individual whose duties and
functions may make that individual a procurement official (see 3.104-
4(h)) should ask if that individual is a procurement official for a
procurement for which the contractor is a competing contractor or is
likely to become a competing contractor before conducting any discussion
related to employment. A competing contractor shall not be considered to
have knowingly violated the prohibitions set forth in subsection
27(a)(1) of the Act (see 3.104-3(a)(1)) if the contractor has made an
inquiry in good faith of the possible procurement official and has been
advised that the individual is not a procurement official for any
procurement for which the contractor is or is reasonably likely to
become a competing contractor, or is advised that the procurement
official has been recused from participation in the procurement in
accordance with 3.104-6.
(2) A procurement official may not solicit or engage in employment
or business opportunity discussions with a competing contractor or a
contractor who is reasonably likely to become a competing contractor
unless the procurement official has been recused from participation in
the procurement in accordance with the procurements at 3.104-6.
(3) A procurement official who wishes to solicit employment from, or
discuss employment with, a contractor and does not know if the
contractor is or is reasonably likely to become a competing contractor
should ask whether the contractor is or is reasonably likely to become a
competing contractor on any procurement for which the individual is
serving as a procurement official. The procurement official--
(i) May rely on the contractor's representation that it is not or is
not likely to become a competing contractor, and enter into employment
or business opportunity dicussions with that contractor; or
(ii) Shall not, if the contractor represents that it is or is
reasonably likely to become a competing contractor, enter into
employment or business opportunity discussions with that contractor. If
the procurement official is an eligible procurement official as defined
at 3.104-6(c), and desires to pursue discussions with that contractor,
the procurement official must first seek and obtain written
authorization for recusal in accordance with the procedures at 3.104-6
before entering into further discussions with that contractor.
(4) A procurement official shall not be considered to have knowingly
violated the prohibitions set forth in subsection 27(b)(1) of the Act
(see 3.104-3(b)(1)) if--
(i) The procurement official has made inquiry in good faith of the
potential contractor, and has been advised that the contractor is not or
will not be a competing contractor on a procurement under the
responsibility of the procurement official; or
(ii) The procurement official has been recused from participation in
the procurement.
(d) Duty to inquire--proprietary and source selection information.
(1) A competing contractor shall not be considered to have knowingly
violated the prohibitions in subsection 27(a)(3) of the Act (see 3.104-
3(a)(3)) if, before proprietary or source selection information was
solicited or obtained, the contractor--
(i) Had made an inquiry in good faith of the contracting officer
(or, if a contracting officer has not been appointed, the Head of the
Agency or his or her designee) regarding whether information was
proprietary or source selection information; and
(ii) Had been advised by such official that the information was not
proprietary or source selection information.
(2) A procurement official shall not be considered to have knowingly
violated the prohibitions in subsection 27(b)(3) of the Act (see 3.104-
3(b)(3)) if, prior to disclosing information, the procurement official
had made an inquiry in good faith of the contracting officer (or, if a
contracting officer has not been appointed, the Head of the Agency or
his or her designee) and had been advised that--
(i) The information was not proprietary or source selection
information; or
(ii) The information is proprietary or source selection information
and the individual to whom the procurement
[[Page 40]]
official wishes to disclose the information has been authorized access
to such information by the Head of the Agency or the contracting
officer.
(3) No person who is given authorized or unauthorized access to
proprietary or source selection information shall be considered to have
knowingly violated the prohibition in subsection 27(d) or the Act (see
3.104-3(c)) if, before disclosing such information, the person:
(i) Had made an inquiry in good faith of the contracting officer
(or, if a contracting officer has not been appointed, the Head of the
Agency or his or her designee) as to whether or not the individual to
whom he seeks to diclose the proprietary or source selection information
has been authorized access to such information by the Head of the Agency
or the contracting officer; and
(ii) Had been advised by such official that such individual has been
so authorized.
(e) Ethics advisory opinions. (1) An employee or former employee of
an agency who is or was a procurement official may request an ethics
advisory opinion from the agency ethics official as to whether specific
conduct which has not yet occurred would violate section 27 of the Act.
An individual who cannot determine, after discussions with the
contracting officer (see subparagraph (b)(2) of this subsection), if he
or she is or was a procurement official may request an ethics advisory
opinion for the purpose of determining his or her status. Ethics
advisory opinions may not be obtained, however, for the purpose of
establishing whether--
(i) Prior to bid opening or receipt of proposals, a particular
contractor is a competing contractor;
(ii) Items of information constitute proprietary or source selection
information as defined in 3.104-4; or
(iii) Proprietary or source selection information may be disclosed.
Questions regarding proprietary and source selection information shall
be referred to the contracting officer or, if a contracting officer has
not been appointed, the Head of the Agency or his or her designee (see
subparagraphs (d)(1) through (d)(3) of this subsection). Questions
regarding a contractor's status as a competing contractor shall be
resolved in accordance with subparagraph (c)(3) of this subsection.
(2) The request for an advisory opinion shall be submitted in
writing, shall be dated and signed, and shall include all information
reasonably available to the procurement official or former procurement
official that is relevant to the inquiry. As a minimum, the request
shall include--
(i) Information about the procurement in which the individual was or
is involved, including contract or solicitation numbers, dates of
solicitation or award, and a description of the goods or services
procured or to be procured;
(ii) Information about the individual's participation in the
procurement, including the dates or time periods of that participation,
and the nature of the individual's duties or responsibilities;
(iii) Information about the competing contractor who would be a
party to the proposed conduct, and the nature of the competing
contractor's interest in the procurement.
(iv) A description of the possible gratuity or other thing of value
if the request concerns conduct that might violate the prohibition of
subsection 27(b)(2) of the Act. It shall be the responsibility of the
individual requesting an advisory opinion to furnish an appraisal or
good faith estimate of market value where the value of an item is in
question.
(v) Specific information about the particular duties to be performed
on behalf of the competing contractor if the request concerns conduct
that might violate either or both of the prohibitions of subsection
27(f) of the Act. Where the issue concerns whether employment with a
subcontractor is permissible under subsection 27(f)(2), the request
shall include information about the subcontract level and dollar amount,
the subcontractor's role in assisting the prime contractor in
negotiating the prime contract, and the individual's role in directing
or recommending the subcontractor to the prime contractor as a source
for the subcontract or reviewing and approving the award or modification
of the subcontract.
(3) Within 30 days after the date a request containing complete
information
[[Page 41]]
is received, or as soon thereafter as practicable, the agency ethics
official shall issue an opinion as to whether proposed conduct is proper
or would violate section 27 of the Act.
(i) Where complete information is not included in the request, the
agency ethics official may ask the requester to provide any information
reasonably available to that person, and the 30-day period will run from
the date that additional information is received. Additional information
may also be requested from other persons, including the Source Selection
Authority, the contracting officer, or the requester's immediate
supervisor.
(ii) Where the opinion cannot be issued within 30 days, the reason
for the delay will be documented in the file. Acceptable reasons for
delay include, but are not limited to, the necessity for the agency
ethics official to independently develop information not reasonable
available to the requester, or to verify questionably information
furnished by the requester.
(iii) In issuing an opinion, the agency ethics official may rely
upon the accuracy of information furnished by the requester or other
agency sources, unless he has reason to believe that the information is
fraudulent, misleading, or otherwise incorrect.
(4) A copy of the request and ethics advisory opinion shall be
retained for a period of 6 years. Agencies shall not provide copies of
the advisory opinions to any person other than the requester, except
with the express authorization of the requester or where release is
otherwise permitted by law.
(5) Where the requester engages in conduct in good faith reliance
upon an ethics advisory opinion, or a competing contractor engages in
conduct based upon good faith reliance on the requester's ethics
advisory opinion, neither the requester nor the competing contractor
shall be found to have knowingly violated the restriction in issue.
Where the requester or the competing contractor has actual knowledge or
reason to believe that the opinion is based upon fraudulent, misleading,
or otherwise incorrect information provided by the requester, their
reliance upon the opinion will not be deemed to be in good faith.
[55 FR 36790, Sept. 6, 1990]
Sec. 3.104-9 Certification requirements.
(a) Applicability. Subsection 27(e) of the Act requires
certifications, prior to the award of a Federal agency contract or
contract modification for property or services in excess of $100,000
awarded or executed on or after December 1, 1990, by the officer or
employee of the contractor responsible for the offer or bid for that
particular contract or contract modification for property or services,
and by the contracting officer for that procurement.
(b) Competing contractor certification. (1) Except as provided in
3.104-9(f), contracting officers shall require the competing contractor
to--
(i) Certify in writing to the contracting officer responsible for
the procurement that, to the best of his or her knowledge and belief,
such officer or employee of the competing contractor has no information
concerning a violation or possible violation of subsections 27 (a), (b),
(d), or (f) of the Act (see 3.104-3) as implemented in the FAR; or
(ii) Disclose to such contracting officer any and all such
information, and certify in writing to such contracting officer that any
and all such information has been disclosed; and
(iii) Except in the case of a contract for the procurement of
commercial items, certify in writing to such contracting officer that,
to the best of his or her knowledge and belief, each officer, employee,
agent, representative, and consultant of such competing contractor who,
on or after December 1, 1990, has participated personally and
substantially in the preparation or submission of such bid or offer, or
in a modification of a contract, as the case may be, has certified in
writing to such competing contractor that he or she--
(A) Is familiar with, and will comply with, the requirements of
subsection 27(a) of the Act (see 3.104-3) as implemented in the FAR; and
(B) Will report immediately to the officer or employee of the
competing contractor responsible for the offer or bid for any contract
or the modification of a contract, as the case may be,
[[Page 42]]
any information concerning a violation or possible violation of
subsections 27 (a), (b), or (f) of the Act (see 3.104-3), occuring on or
after December 1, 1990, as implemented in the FAR.
(2) Subcontractors are not required to submit the certificate
required by subsection 27(e)(1) of the Act. However, nothing in 3.104
precludes a competing contractor from requesting certifications from its
subcontractors.
(3) The signed certifications prescribed in 3.104-10 shall be
submitted as follows:
(i) Procurements exceeding $100,000 using sealed bidding procedures:
(A) For procurements using sealed bidding procedures, the signed
certifications shall be submitted by each bidder with the bid
submission, except for procurements using two-step sealed bidding
procedures (see subpart 14.5). For those procurements, the
certifications shall be submitted with submission of the step two sealed
bids. A certificate is not required for indefinite delivery contracts
(see subpart 16.5) unless the total estimated value of all orders
eventually to be placed under the contract is expected to exceed
$100,000.
(B) For contracts and contract modifications which include options,
a certificate is required when the aggregate value of the contract or
contract modification and all options (see 3.104-4(e)) exceeds $100,000.
(C) Failure of a bidder to submit the signed certificate with its
bid render the bid nonresponsive.
(ii) Procurements exceeding $100,000 using other than sealed bidding
procedures: (A) For procurements, including contract modifications, made
using procedures other than sealed bidding, the signed certifications
shall be submitted by the successful offeror to the contracting officer
within the time period specified by the contracting officer when
requesting the certificates, except as provided in subdivisions
(b)(3)(ii) (B) through (F) of this subsection. In no event shall the
certificate be submitted subsequent to award of a contract or execution
of a contract modification.
(B) For letter contracts, other unpriced contracts, or unpriced
contract modifications, whether or not the unpriced contract or
modification contains a maximum or not to exceed price, the signed
certifications shall be submitted prior to the award of the letter
contract, unpriced contract, or unpriced contract modification, and
prior to the definitization of the letter contract or the establishment
of the price of the unpriced contract or unpriced contract modification.
The second certification shall apply only to the period between award of
the letter contract and execution of the document definitizing the
letter contract, or award of the unpriced contract or unpriced contract
modification and execution of the document establishing the definitive
price of such unpriced contract or unpriced contract modification.
(C) For basic ordering agreements--prior to the execution of a
priced order; prior to the execution of an unpriced order, whether or
not the unpriced order contains a maximum or not to exceed price; and
prior to establishing the price of an unpriced order. The second
certificate to be submitted for unpriced orders shall apply only to the
period between award of the unpriced order and execution of the document
establishing the definitive price for such order.
(D) A certificate is not required for indefinite delivery contracts
(see subpart 16.5) unless the total estimated value of all orders
eventually to be placed under the contract is expected to exceed
$100,000.
(E) For contracts and contract modifications which include options,
a certificate is required when the aggregate value of the contract or
contract modification and all options exceeds $100,000.
(F) For purposes of contracts entered into under section 8(a) of the
SBA, the business entity with whom the SBA contracts, and not the SBA,
shall be required to comply with the certification requirements of
subsection 27(e). The SBA shall obtain the signed certificate from the
business entity, and forward the certificate to the contracting officer
prior to the award of a contract to the SBA.
(G) Failure of an offeror to submit the signed certificate within
the time prescribed by the contracting officer is
[[Page 43]]
a failure to comply with a material requirement of the solicitation and
shall cause the offer to be rejected.
(c) Contracting officer certifications. (1) In accordance with
subsection 27(e)(2) of the Act, a Federal agency may not award a
contract for the procurement of property or services, or agree to a
modification of any contract, if the contract or contract modification
exceeds $100,000, unless the contracting officer responsible for such
procurement--
(i) Certifies in writing to the head of such agency that, to the
best of his or her knowledge and belief, the contracting officer has no
information concerning a violation or possible violation of subsections
27 (a), (b), (d), or (f) of the Act (see 3.104-3), as implemented in the
FAR, pertaining to such procurement; or
(ii) Discloses to the head of such agency any and all such
information and certifies in writing that any and all such information
has been disclosed.
(2) Immediately prior to contract award or execution of a contract
modification, the contracting officer shall execute the following
certificate and maintain the completed certificate in the contract file:
Contracting Officer Certificate of Procurement Integrity
1. I, [Name of contracting officer], hereby certify that, to the
best of my knowledge and belief, with the exception of any information
described in this certificate, I have no information concerning a
violation or possible violation of subsection (a), (b), (d), or (f) of
section 27 of the Office of Federal Procurement Policy Act* (41 U.S.C.
423), as implemented in the FAR, occurring during the conduct of this
procurement (contract/modification number).
2. Violations or possible violations: (Continue on plain bond paper
if necessary, and label Contracting Officer Certificate of Procurement
Integrity (Continuation Sheet), ENTER ``NONE'' IF NONE EXISTS.)
_______________________________________________________________________
_______________________________________________________________________
_______________________________________________________________________
(Signature of contracting officer and date)
* Subsections 27 (a), (b), and (d), are effective on December 1,
1990. Subsection 27(f) is effective on June 1, 1991. THIS CERTIFICATION
CONCERNS A MATTER WITHIN THE JURISDICTION OF AN AGENCY OF THE UNITED
STATES AND THE MAKING OF A FALSE, FICTITIOUS, OR FRAUDULENT
CERTIFICATION MAY RENDER THE MAKER SUBJECT TO PROSECUTION UNDER TITLE
18, UNITED STATES CODE, SECTION 1001.
(End of certification)
(d) Additional certifications. (1) Subsection 27(e)(3) of the Act
provides that the head of a Federal agency may require any procurement
official or any competing contractor, at any time during the conduct of
any Federal agency procurement of property or services--
(i) To certify in writing that, to the best of his or her knowledge
and belief, such procurement official or the officer or employee of the
competing contractor responsible for the offer or bid for a contract or
the modification of a contract, has no information concerning a
violation or possible violation of subsections 27 (a), (b), (d), and (f)
of the Act (see 3.104-3), as implemented in the FAR, occurring during
the procurement; or
(ii) To disclose any and all such information and to certify in
writing that any and all such information has been disclosed.
(2) In addition to the Head of the Agency, additional certifications
may be required only by the HCA or his or her designee, provided that
the designee is an individual of General Officer, Flag, SES or
equivalent rank and is at least one organizational level above the
contracting officer.
(3) Any additional certifications shall be submitted to the
contracting officer unless another person is specified by the individual
requiring the additional certifications.
(4) Each procurement official or competing contractor shall be
afforded a reasonable time to comply with the additional certification
requirements.
(5) A competing contractor's failure to submit any additional
certifications that may be required shall cause the competing
contractor's offer to be rejected.
(e) Recordkeeping requirements. (1) In accordance with subsections
27(e)(5) (A) and (B) and 27(e)(7)(A) of the Act, the contracting officer
responsible for the award or modification of a contract in excess of
$100,000 shall maintain, as part of the contract file--
[[Page 44]]
(i) All competing contractor, contracting officer, and procurement
official certifications required by subsections 27 (e)(1), (e)(2), and
(e)(4) of the Act, and any additional certifications required by
subsection 27(e)(3) of the Act for that particular procurement.
(ii) All certifications required by subsection 27(l) of the Act (see
3.104-12) from individuals acting as procurement officials on behalf of
the procuring agency, who are, or are employed by, contractors,
subcontractors, consultants, experts, or advisors (other than competing
contractors).
(iii) A record of all persons who have been authorized by the Head
of the Agency or the contracting officer to have access to proprietary
or source selection information regarding the procurement. When classes
of persons have been authorized, this record shall identify the class of
persons so authorized and, to the maximum extent practicable, the names
of the individuals within the class.
(2) Certifications obtained from Government officers or employees
(see 3.104-4(d)) who are required to submit a certification under
subsection 27(l) of the Act shall be maintained in accordance with
agency procedures.
(3) Ethics advisory opinions shall be retained, in accordance with
agency procedures, for a period of 6 years.
(f) Exceptions to certification requirements. Pursuant to subsection
27(e)(7)(B) of the Act, certification requirements set forth in 3.104-9
do not apply--
(1) To contracts with a foreign government or an international
organization that are not required to be awarded using competitive
procedures pursuant to section 303(c)(4) of the Federal Property and
Administrative Services Act of 1949 (41 U.S.C. 253(c)(4)), or section
2304(c)(4) of title 10 U.S.C.; or
(2) In an exceptional case, when the Head of the Agency concerned
determines in writing that the certification requirement should be
waived. This authority may not be delegated. The contracting officer
shall submit the request for waiver in accordance with agency
procedures. The request shall clearly identify the procurement or class
of procurements and provide the rationale for the requested waiver. The
decision of the agency head shall state the reasons for approving or
disapproving the waiver. The agency head shall promptly notify Congress
in writing of each waiver approved. Procurements for which a waiver may
be appropriate include--
(i) Where prices are set by law or regulation;
(ii) Where terms and conditions of a contract are specified by an
agreement with a foreign government or governments;
(iii) Where supplies or services are provided by foreign nationals
to United States facilities overseas for use outside the United States;
(iv) Where a foreign government specifies a particular U.S.
contractor to satisfy its requirements (see 6.302-4(b)(1)).
[55 FR 36792, Sept. 6, 1990, as amended at 55 FR 49854, Nov. 30, 1990;
59 FR 11387, Mar. 10, 1994; 60 FR 37774, July 21, 1995]
Sec. 3.104-10 Solicitation provision and contract clauses.
(a) The contracting officer shall insert the provision at 52.203-8,
Requirement for Certificate of Procurement Integrity, in all
solicitations where the resultant contract award is expected to exceed
$100,000, unless, pursuant to 3.104-9(f), a certification is not
required or a waiver has been granted. For procurements using other than
sealed bidding procedures, the contracting officer shall substitute
Alternate I for paragraph (c) of that provision.
(b) The contracting officer shall insert the clause at 52.203-9,
Requirement for Certificate of Procurement Integrity-Modification, in
all solicitations where the resultant contract award is expected to
exceed $100,000, all contracts in excess of $100,000, and modifications
to contracts which do not already contain the clause when the
modification is expected to exceed $100,000, unless, pursuant to 3.104-
9(f), a certificate is not required or a waiver has been granted.
(c) The contracting officer shall insert the clause at 52.203-10,
Price or Fee Adjustment for Illegal for Improper Activity, in all
solicitations where the resultant contract award is expected to exceed
the simplified acquisition threshold and all contracts
[[Page 45]]
and modifications to contracts exceeding that threshold which do not
already contain the clause when the modification is expected to exceed
that threshold.
(d) The contracting officer shall insert the clause at 52.203-13,
Procurement Integrity-Service Contracting, in all solicitations and
contracts where the Government is procuring or may order the services of
contractor employees to serve as procurement officials for another
agency procurement. In addition, the contracting officer shall insert
the provisions and clauses at 52.203-8, 52.203-9, and 52.203-10 in such
solicitations and contracts as prescribed in this subsection.
[55 FR 36793, Sept. 6, 1990, as amended at 60 FR 34744, July 3, 1995; 61
FR 39191, July 26, 1996]
Sec. 3.104-11 Processing violations or possible violations.
(a) If the contracting officer makes or receives a disclosure of
information pursuant to subsection 27(e) of the Act or otherwise
receives or obtains information of a violation or possible violation of
subsections 27 (a), (b), (d), or (f) of the Act (see 3.104-3), the
contracting officer shall determine whether the reported violation or
possible violation has any impact on the pending award or selection of
the source therefor.
(1) If the contracting officer concludes that there is no impact on
the procurement, the contracting officer shall forward the information
concerning the violation or possible violation, accompanied by
appropriate documentation supporting that conclusion, to an individual
designated in accordance with agency procedures. With the concurrence of
that individual, the contracting officer shall, without further
approval, proceed with the procurement. The individual concurring with
that conclusion shall forward all information relating to the violation
or possible violation to the HCA, or his or her designee, to satisfy the
disclosure requirements of subsection 27(e)(2) of the Act.
(2) If the individual reviewing the contracting officer's conclusion
does not agree with that conclusion, he or she shall advise the
contracting officer to withhold award and shall promptly forward the
information and documentation to the HCA or his or her designee.
(3) If the contracting officer determines that the violation or
possible violation impacts the procurement, the contracting officer
shall promptly forward the information to the HCA or his or her
designee.
(b) The HCA or his or her designee receiving any information
describing an actual or possible violation of subsection 27 (a), (b),
(d), or (f) of the Act, shall review all information available and take
appropriate action in accordance with agency procedures, such as--
(1) Advising the contracting officer to continue with the
procurement;
(2) Causing an investigation to be conducted;
(3) Referring the information disclosed to appropriate criminal
investigative agencies;
(4) Determining that a violation occurred.
(c) Prior to determining that a competing contractor (see 3.104-
4(b)) has violated the Act, the HCA or his or her designee may request
information from appropriate parties regarding the violation or possible
violation when considered in the best interests of the Government.
(d) If the HCA or his or her designee determines that the
prohibitions of section 27 of the Act have been violated, then the HCA
or his or her designee may direct the contracting officer to--
(1) If a contract has not been awarded, or a contract modification
has not been executed--
(i) Cancel the procurement;
(ii) Disqualify an offeror; or
(iii) Take any other appropriate actions in the interests of the
Government.
(2) If a contract has been awarded or a contract modification has
been executed--
(i) Effect appropriate contractual remedies, including profit
recapture as provided for in the clause at 52.203-10, Price or Fee
Adjustment for Illegal or Improper Activity;
(ii) Void or rescind the contract, or contract modification; or
[[Page 46]]
(iii) Take any other appropriate actions in the best interests of
the Government.
(3) Refer the matter to the agency suspension and debarment
official.
(e) The HCA or his or her designee shall, in his or her best
judgment, recommend or direct an administrative or contractual remedy
commensurate with the severity and effect of the violation.
(f) If the HCA or his or her designee receiving information
concerning a violation or possible violation determines that award is
justified by urgent and compelling circumstances, or is otherwise in the
interests of the Government, he or she may authorize the contracting
officer to award the contract or execute the contract modification after
notification to the Head of the Agency in accordance with agency
procedures.
(g) The designee of the HCA referenced in paragraphs (a), (b), (c),
(d), and (e) of this subsection must be an individual at least one
organizational level above the contracting officer and be of General
Officer, Flag, SES or equivalent rank.
[55 FR 36794, Sept. 6, 1990]
Sec. 3.104-12 Ethics program training requirements.
(a) Subsection 27(l) of the Act provides that the head of each
Federal agency shall establish a procurement ethics training program for
its procurement officials. The program shall, as a minimum--
(1) Provide for the distribution of a written explanation of
subsections 27 (a) through (f) of the Act to such procurement officials;
and
(2) Require each such procurement official, as a condition of
serving as a procurement official, to certify in writing that he or she
is familiar with the provisions of subsections 27 (b), (c), and (e) of
the Act and will not engage in any conduct prohibited by such
subsections, and will report immediately to the contracting officer any
information concerning a violation or possible violation of subsection
27 (a), (b), (d), or (f) of the Act as implemented in the FAR.
(3) Certification made under section 27 as originally enacted and
implemented in the FAR do not satisfy the certification requirements of
subparagraph (a)(2) of this subsection. Agencies may use Optional Form
333 at 53.302-333 to obtain the certifications required by subparagraph
(a)(2) of this subsection.
(b) Contractors, subcontractors, consultants, experts, or advisors
(other than competing contractors) are responsible for establishing a
procurement ethics training program for individuals in their employ who
may serve as procurement officials on behalf of a Federal agency. The
program shall, as a minimum, comply with subparagraphs (a)(1) and (a)(2)
of this subsection.
[55 FR 36794, Sept. 6, 1990]
Subpart 3.2--Contractor Gratuities to Government Personnel
Sec. 3.201 Applicability.
This subpart applies to all executive agencies, except that coverage
concerning exemplary damages applies only to the Department of Defense
(10 U.S.C. 2207).
Sec. 3.202 Contract clause.
The contracting officer shall insert the clause at 52.203-3,
Gratuities, in solicitations and contracts with a value exceeding the
simplified acquisition threshold, except those for personal services and
those between military departments or defense agencies and foreign
governments that do not obligate any funds appropriated to the
Department of Defense.
[61 FR 39200, July 26, 1996]
Sec. 3.203 Reporting suspected violations of the Gratuities clause.
Agency personnel shall report suspected violations of the Gratuities
clause to the contracting officer or other designated official in
accordance with agency procedures. The agency reporting procedures shall
be published as an implementation of this section 3.203 and shall
clearly specify--
(a) What to report and how to report it; and
(b) The channels through which reports must pass, including the
function
[[Page 47]]
and authority of each official designated to review them.
Sec. 3.204 Treatment of violations.
(a) Before taking any action against a contractor, the agency head
or a designee shall determine, after notice and hearing under agency
procedures, whether the contractor, its agent, or another
representative, under a contract containing the Gratuities clause--
(1) Offered or gave a gratuity (e.g., an entertainment or gift) to
an officer, official, or employee of the Government; and
(2) Intended by the gratuity to obtain a contract or favorable
treatment under a contract (intent generally must be inferred).
(b) Agency procedures shall afford the contractor an opportunity to
appear with counsel, submit documentary evidence, present witnesses, and
confront any person the agency presents. The procedures should be as
informal as practicable, consistent with principles of fundamental
fairness.
(c) When the agency head or designee determines that a violation has
occurred, the Government may--
(1) Terminate the contractor's right to proceed;
(2) Initiate debarment or suspension measures as set forth in
subpart 9.4; and
(3) Assess exemplary damages, if the contract uses money
appropriated to the Department of Defense.
Subpart 3.3--Reports of Suspected Antitrust Violations
Sec. 3.301 General.
(a) Practices that eliminate competition or restrain trade usually
lead to excessive prices and may warrant criminal, civil, or
administrative action against the participants. Examples of
anticompetitive practices are collusive bidding, follow-the-leader
pricing, rotated low bids, collusive price estimating systems, and
sharing of the business.
(b) Contracting personnel are an important potential source of
investigative leads for antitrust enforcement and should therefore be
sensitive to indications of unlawful behavior by offerors and
contractors. Agency personnel shall report, in accordance with agency
regulations, evidence of suspected antitrust violations in acquisitions
for possible referral to (1) the Attorney General under 3.303 and (2)
the agency office responsible for contractor debarment and suspension
under subpart 9.4.
[48 FR 42108, Sept. 19, 1983, as amended at 50 FR 1727, Jan. 11, 1985;
50 FR 52429, Dec. 23, 1985]
Sec. 3.302 Definitions.
Identical bids means bids for the same line item that are determined
to be identical as to unit price or total line item amount, with or
without the application of evaluation factors (e.g., discount or
transportation cost).
Line item means an item of supply or service, specified in an
invitation for bids, for which the bidder must bid a separate price.
[49 FR 12974, Mar. 30, 1984]
Sec. 3.303 Reporting suspected antitrust violations.
(a) Agencies are required by 41 U.S.C. 253(B)(e) and 10 U.S.C.
2305(b)(5) to report to the Attorney General any bids or proposals that
evidence a violation of the antitrust laws. These reports are in
addition to those required by subpart 9.4.
(b) The antitrust laws are intended to ensure that markets operate
competitively. Any agreement or mutual understanding among competing
firms that restrains the natural operation of market forces is suspect.
Paragraph (c) below identifies behavior patterns that are often
associated with antitrust violations. Activities meeting the
descriptions in paragraph (c) are not necessarily improper, but they are
sufficiently questionable to warrant notifying the appropriate
authorities, in accordance with agency procedures.
(c) Practices or events that may evidence violations of the
antitrust laws include--
(1) The existence of an industry price list or price agreement to
which contractors refer in formulating their offers;
(2) A sudden change from competitive bidding to identical bidding;
[[Page 48]]
(3) Simultaneous price increases or follow-the-leader pricing;
(4) Rotation of bids or proposals, so that each competitor takes a
turn in sequence as low bidder, or so that certain competitors bid low
only on some sizes of contracts and high on other sizes;
(5) Division of the market, so that certain competitors bid low only
for contracts let by certain agencies, or for contracts in certain
geographical areas, or on certain products, and bid high on all other
jobs;
(6) Establishment by competitors of a collusive price estimating
system;
(7) The filing of a joint bid by two or more competitors when at
least one of the competitors has sufficient technical capability and
productive capacity for contract performance;
(8) Any incidents suggesting direct collusion among competitors,
such as the appearance of identical calculation or spelling errors in
two or more competitive offers or the submission by one firm of offers
for other firms; and
(9) Assertions by the employees, former employees, or competitors of
offerors, that an agreement to restrain trade exists.
(d) Identical bids shall be reported under this section if the
agency has some reason to believe that the bids resulted from collusion.
(e) For offers from foreign contractors for contracts to be
performed outside the United States, contracting officers may refer
suspected collusive offers to the authorities of the foreign government
concerned for appropriate action.
(f) Agency reports shall be addressed to the Attorney General, U.S.
Department of Justice, Washington, DC 20530, Attention: Assistant
Attorney General, Antitrust Division, and shall include--
(1) A brief statement describing the suspected practice and the
reason for the suspicion; and
(2) The name, address, and telephone number of an individual in the
agency who can be contacted for further information.
(g) Questions concerning this reporting requirement may be
communicated by telephone directly to the Office of the Assistant
Attorney General, Antitrust Division.
[48 FR 42108, Sept. 19, 1983, as amended at 49 FR 12974, Mar. 30, 1984;
50 FR 1727, Jan. 11, 1985; 50 FR 52429, Dec. 23, 1985; 55 FR 25526, June
21, 1990]
Subpart 3.4--Contingent Fees
Sec. 3.400 Scope of subpart.
This subpart prescribes policies and procedures that restrict
contingent fee arrangements for soliciting or obtaining Government
contracts to those permitted by 10 U.S.C. 2306(b) and 41 U.S.C. 254(a).
Sec. 3.401 Definitions.
Bona fide agency, as used in this subpart, means an established
commercial or selling agency, maintained by a contractor for the purpose
of securing business, that neither exerts nor proposes to exert improper
influence to solicit or obtain Government contracts nor holds itself out
as being able to obtain any Government contract or contracts through
improper influence.
Bona fide employee, as used in this subpart, means a person,
employed by a contractor and subject to the contractor's supervision and
control as to time, place, and manner of performance, who neither exerts
nor proposes to exert improper influence to solicit or obtain Government
contracts nor holds out as being able to obtain any Government contract
or contracts through improper influence.
Contingent fee, as used in this subpart, means any commission,
percentage, brokerage, or other fee that is contingent upon the success
that a person or concern has in securing a Government contract.
Improper influence, as used in this subpart, means any influence
that induces or tends to induce a Government employee or officer to give
consideration or to act regarding a Government contract on any basis
other than the merits of the matter.
Sec. 3.402 Statutory requirements.
Contractors' arrangements to pay contingent fees for soliciting or
obtaining Government contracts have long been considered contrary to
public policy because such arrangements may
[[Page 49]]
lead to attempted or actual exercise of improper influence. In 10 U.S.C.
2306(b) and 41 U.S.C. 254(a), Congress affirmed this public policy but
permitted certain exceptions. These statutes--
(a) Require in every negotiated contract a warranty by the
contractor against contingent fees;
(b) Permit, as an exception to the warranty, contingent fee
arrangements between contractors and bona fide employees or bona fide
agencies; and
(c) Provide that, for breach or violation of the warranty by the
contractor, the Government may annul the contract without liability or
deduct from the contract price or consideration, or otherwise recover,
the full amount of the contingent fee.
Sec. 3.403 Applicability.
This subpart applies to all contracts. Statutory requirements for
negotiated contracts are, as a matter of policy, extended to sealed bid
contracts.
[48 FR 42108, Sept. 19, 1983, as amended at 50 FR 1727, Jan. 11, 1985;
50 FR 52429, Dec. 23, 1985]
Sec. 3.404 Contract clause.
The contracting officer shall insert the clause at 52.203-5,
Covenant Against Contingent Fees, in all solicitations and contracts
exceeding the simplified acquisition threshold, other than those for
commercial items (see parts 2 and 12).
[61 FR 39188, July 26, 1996]
Sec. 3.405 Misrepresentations or violations of the Covenant Against Contingent Fees.
(a) Government personnel who suspect or have evidence of attempted
or actual exercise of improper influence, misrepresentation of a
contingent fee arrangement, or other violation of the Covenant Against
Contingent Fees shall report the matter promptly to the contracting
officer or appropriate higher authority in accordance with agency
procedures.
(b) When there is specific evidence or other reasonable basis to
suspect one or more of the violations in paragraph (a) above, the chief
of the contracting office shall review the facts and, if appropriate,
take or direct one or more of the following, or other, actions:
(1) If before award, reject the bid or proposal.
(2) If after award, enforce the Government's right to annul the
contract or to recover the fee.
(3) Initiate suspension or debarment action under subpart 9.4.
(4) Refer suspected fraudulent or criminal matters to the Department
of Justice, as prescribed in agency regulations.
[48 FR 42108, Sept. 19, 1983. Redesignated at 61 FR 39188, July 26,
1996]
Sec. 3.406 Records.
For enforcement purposes, agencies shall preserve any specific
evidence of one or more of the violations in 3.405(a), together with all
other pertinent data, including a record of actions taken. Contracting
offices shall not retire or destroy these records until it is certain
that they are no longer needed for enforcement purposes. If the original
record is maintained in a central file, a copy must be retained in the
contract file.
[48 FR 42108, Sept. 19, 1983. Redesignated and amended at 61 FR 39188,
July 26, 1996]
Subpart 3.5--Other Improper Business Practices
3.501 Buying-in.
Sec. 3.501-1 Definition.
Buying-in means submitting an offer below anticipated costs,
expecting to--
(a) Increase the contract amount after award (e.g., through
unnecessary or excessively priced change orders); or
(b) Receive follow-on contracts at artificially high prices to
recover losses incurred on the buy-in contract.
Sec. 3.501-2 General.
(a) Buying-in may decrease competition or result in poor contract
performance. The contracting officer must take appropriate action to
ensure buying-in losses are not recovered by the contractor through the
pricing of (1) change orders or (2) follow-on contracts subject to cost
analysis.
[[Page 50]]
(b) The Government should minimize the opportunity for buying-in by
seeking a price commitment covering as much of the entire program
concerned as is practical by using--
(1) Multiyear contracting, with a requirement in the solicitation
that a price be submitted only for the total multiyear quantity; or
(2) Priced options for additional quantities that, together with the
firm contract quantity, equal the program requirements (see subpart
17.2).
(c) Other safeguards are available to the contracting officer to
preclude recovery of buying-in losses (e.g., amortization of
nonrecurring costs (see 15.804-6(f)) and treatment of unreasonable price
quotations (see 15.803(d)).
3.502 Subcontractor kickbacks.
Sec. 3.502-1 Definitions.
Kickback, as used in this section, means any money, fee, commission,
credit, gift, gratuity, thing of value, or compensation of any kind
which is provided, directly or indirectly, to any prime contractor,
prime contractor employee, subcontractor, or subcontractor employee for
the purpose of improperly obtaining or rewarding favorable treatment in
connection with a prime contract or in connection with a subcontract
relating to a prime contract.
Person, as used in this section, means a corporation, partnership,
business association of any kind, trust, joint-stock company, or
individual.
Prime contract, as used in this section, means a contract or
contractual action entered into by the United States for the purpose of
obtaining supplies, materials, equipment, or services of any kind.
Prime Contractor, as used in this section, means a person who has
entered into a prime contract with the United States.
Prime Contractor employee, as used in this section, means any
officer, partner, employee, or agent of a prime contractor.
Subcontract, as used in this section, means a contract or
contractural action entered into by a prime contractor or subcontractor
for the purpose of obtaining supplies, materials, equipment, or service
of any kind under a prime contract.
Subcontractor, as used in this section, (a) means any person, other
than the prime contractor, who offers to furnish or furnishes any
supplies, materials, equipment, or services of any kind under a prime
contract or a subcontract entered into in connection with such prime
contract, and (b) includes any person who offers to furnish or furnishes
general supplies to the prime contractor or a higher tier subcontractor.
Subcontractor employee, as used in this section, means any officer,
partner, employee, or agent of a subcontractor.
[52 FR 6121, Feb. 27, 1987, as amended at 53 FR 34226, Sept. 2, 1988]
Sec. 3.502-2 Subcontractor kickbacks.
The Anti-Kickback Act of 1986 (41 U.S.C. 51-58) was passed to deter
subcontractors from making payments and contractors from accepting
payments for the purpose of improperly obtaining or rewarding favorable
treatment in connection with a prime contract or a subcontract relating
to a prime contract. The Act--
(a) Prohibits any person from--
(1) Providing, attempting to provide, or offering to provide any
kickback;
(2) Soliciting, accepting, or attempting to accept any kickbacks; or
(3) Including, directly or indirectly, the amount of any kickback in
the contract price charged by a subcontractor to a prime contractor or a
higher tier subcontractor or in the contract price charged by a prime
contractor to the United States.
(b) Imposes criminal penalties on any person who knowingly and
willfully engages in the prohibited conduct addressed in paragraph (a)
of this subsection.
(c) Provides for the recovery of civil penalties by the United
States from any person who knowingly engages in such prohibited conduct
and from any person whose employee, subcontractor, or subcontractor
employee provides, accepts, or charges a kickback.
(d) Provides that--
(1) The contracting officer may offset the amount of a kickback
against monies owed by the United States to the
[[Page 51]]
prime contractor under the prime contract to which such kickback
relates;
(2) The contracting officer may direct a prime contractor to
withhold from any sums owed to a subcontract under a subcontractor of
the prime contract the amount of any kickback which was or may be offset
against the prime contractor under subparagraph (d)(1) of this
subsection; and
(3) An offset under subparagraph (d)(1) or a direction under
subparagraph (d)(2) of this subsection is a claim by the Government for
the purposes of the Contract Disputes Act of 1978.
(e) Authorizes contracting officers to order that sums withheld
under subparagraph (d)(2) of this subsection be paid to the contracting
agency, or if the sum has already been offset against the prime
contractor, that it be retained by the prime contractor.
(f) Requires the prime contractor to notify the contracting officer
when the withholding under subparagraph (d)(2) of this subsection has
been accomplished unless the amount withheld has been paid to the
Government.
(g) Requires a prime contractor or subcontractor to report in
writing to the inspector general of the contracting agency, the head of
the contracting agency if the agency does not have an inspector general,
or the Department of Justice any possible violation of the Act when the
prime contractor or subcontractor has reasonable grounds to believe such
violation may have occurred.
(h) Provides that, for the purpose of ascertaining whether there has
been a violation of the Act with respect to any prime contract, the
General Accounting Office and the inspector general of the contracting
agency, or a representative of such contracting agency designated by the
head of such agency if the agency does not have an inspector general,
shall have access to and may inspect the facilities and audit the books
and records, including any electronic data or records, of any prime
contractor or subcontractor under a prime contract awarded by such
agency.
(i) Requires each contracting agency to include in each prime
contract exceeding $100,000 for other than commercial items (see part
12), a requirement that the prime contractor shall--
(1) Have in place and follow reasonable procedures designed to
prevent and detect violations of the Act in its own operations and
direct business relationships (e.g., company ethics rules prohibiting
kickbacks by employees, agents, or subcontractors; education programs
for new employees and subcontractors, explaining policies against
kickbacks, related company procedures and the consequences of detection;
procedures requiring subcontractors to certify they have not paid
kickbacks; procurement procedures to minimize the opportunity for
kickbacks; audit procedures designed to detect kickbacks; periodic
surveys of subcontractors to elicit information about kickbacks;
procedures to report kickbacks to law enforcement officials; annual
declarations by employees of gifts or gratuities received from
subcontractors; annual employee declarations that they have violated no
company ethics rules; personnel practices that document unethical or
illegal behavior and make such information available to prospective
employers); and
(2) Cooperate fully with any Federal agency investigating a possible
violation of the Act.
(j) Notwithstanding paragraph (i) of this subsection, a prime
contractor shall cooperate fully with any Federal government agency
investigating a violation of Section 3 of the Anti-Kickback Act of 1986
(41 U.S.C. 51-58).
[52 FR 6121, Feb. 27, 1987; 52 FR 9989, Mar. 27, 1987, as amended at 53
FR 34226, Sept. 2, 1988; 60 FR 48235, Sept. 18, 1995; 61 FR 39191, July
26, 1996]
Sec. 3.502-3 Contract clause.
The contracting officer shall insert the clause at 52.203-7, Anti-
Kickback Procedures, in solicitations and contracts exceeding the
simplified acquisition threshold, other than those for commercial items
(see part 12).
[60 FR 48235, Sept. 18, 1995, as amended at 61 FR 39190, July 26, 1996]
[[Page 52]]
3.503 Unreasonable restrictions on subcontractor sales.
Sec. 3.503-1 Policy.
10 U.S.C. 2402 and 41 U.S.C. 253(g) require that subcontractors not
be unreasonably precluded from making direct sales to the Government of
any supplies or services made or furnished under a contract. However,
this does not preclude contractors from asserting rights that are
otherwise authorized by law or regulation.
[50 FR 35475, Aug. 30, 1985, and 51 FR 27116, July 29, 1986]
Sec. 3.503-2 Contract clause.
The contracting officer shall insert the clause at 52.203-6,
Restrictions on Subcontractor Sales to the Government, in solicitations
and contracts exceeding the simplified acquisition threshold. For the
acquisition of commercial items, the contracting officer shall use the
clause with its Alternate I.
[60 FR 48235, Sept. 18, 1995, as amended at 61 FR 39190, July 26, 1996]
Subpart 3.6--Contracts With Government Employees or Organizations Owned
or Controlled by Them
Sec. 3.601 Policy.
(a) Except as specified in 3.602, a contracting officer shall not
knowingly award a contract to a Government employee or to a business
concern or other organization owned or substantially owned or controlled
by one or more Government employees. This policy is intended to avoid
any conflict of interest that might arise between the employees'
interests and their Government duties, and to avoid the appearance of
favoritism or preferential treatment by the Government toward its
employees.
(b) For purposes of this subpart, special Government employees (as
defined in 18 U.S.C. 202) performing services as experts, advisors, or
consultants, or as members of advisory committees, are not considered
Government employees unless--
(1) The contract arises directly out of the individual's activity as
a special Government employee;
(2) In the individual's capacity as a special Government employee,
the individual is in a position to influence the award of the contract;
or
(3) Another conflict of interest is determined to exist.
[55 FR 34864, Aug. 24, 1990]
Sec. 3.602 Exceptions.
The agency head, or a designee not below the level of the head of
the contracting activity, may authorize an exception to the policy in
3.601 only if there is a most compelling reason to do so, such as when
the Government's needs cannot reasonably be otherwise met.
Sec. 3.603 Responsibilities of the contracting officer.
(a) Before awarding a contract, the contracting officer shall obtain
an authorization under 3.602 if--
(1) The contracting officer knows, or has reason to believe, that a
prospective contractor is one to which award is otherwise prohibited
under 3.601; and
(2) There is a most compelling reason to make an award to that
prospective contractor.
(b) The contracting officer shall comply with the requirements and
guidance in subpart 9.5 before awarding a contract to an organization
owned or substantially owned or controlled by Government employees.
Subpart 3.7--Voiding and Rescinding Contracts
Source: 51 FR 27116, July 29, 1986, unless otherwise noted.
Sec. 3.700 Scope of subpart.
(a) This subpart prescribes Governmentwide policies and procedures
for exercising discretionary authority to declare void and rescind
contracts in relation to which there has been a final conviction for
bribery, conflict of interest, or similar misconduct, and to recover the
amounts expended and property transferred therefor.
(b) This subpart does not prescribe policies or procedures for, or
govern
[[Page 53]]
the exercise of, any other remedy available to the Government with
respect to such contracts, including but not limited to, the common law
right of avoidance, rescission, or cancellation.
Sec. 3.701 Purpose.
This subpart provides a means to--
(a) Provide the Government with an administrative remedy with
respect to contracts in relation to which there has been a final
conviction for bribery, conflict of interest, or similar misconduct; and
(b) Deter similar misconduct in the future by those who are involved
in the award, performance, and administration of Government contracts.
Sec. .702 Definition.
Final conviction means a conviction, whether entered on a verdict or
plea, including a plea of nolo contendere, for which sentence has been
imposed.
Sec. 3.703 Authority.
Section 1(e) of Pub. L. 87-849, 18 U.S.C. 218 (the Act), empowers
the President or the heads of executive agencies acting under
regulations prescribed by the President, to declare void and rescind
contracts and other transactions enumerated in the Act, in relation to
which there has been a final conviction for bribery, conflict of
interest, or any other violation of Chapter 11 of Title 18 of the United
States Code (18 U.S.C. 201-224). Executive Order 12448, November 4,
1983, delegates the President's authority under the Act to the heads of
the executive agencies and military departments.
Sec. 3.704 Policy.
(a) In cases in which there is a final conviction for any violation
of 18 U.S.C. 201-224 involving or relating to contracts awarded by an
agency, the agency head or designee shall consider the facts available
and, if appropriate, may declare void and rescind contracts, and recover
the amounts expended and property transferred by the agency in
accordance with the policies and procedures of this subpart.
(b) Since a final conviction under 18 U.S.C. 201-224 relating to a
contract also may justify the conclusion that the party involved is not
presently responsible, the agency should consider initiating debarment
proceedings in accordance with FAR subpart 9.4, Debarment, Suspension,
and Ineligibility, if debarment has not been initiated or is not in
effect at the time the final conviction is entered.
Sec. 3.705 Procedures.
(a) Reporting. The facts concerning any final conviction for any
violation of 18 U.S.C. 201-224 involving or relating to agency contracts
shall be reported promptly to the agency head or designee for that
official's consideration. The agency head or designee shall promptly
notify the Civil Division, Department of Justice, that an action is
being considered under this subpart.
(b) Decision. Following an assessment of the facts, the agency head
or designee may declare void and rescind contracts with respect to which
a final conviction has been entered, and recover the amounts expended
and the property transferred by the agency under the terms of the
contracts involved.
(c) Decision-making process. Agency procedures governing the voiding
and rescinding decision-making process shall be as informal as is
practicable, consistent with the principles of fundamental fairness. As
a minimum, however, agencies shall provide the following:
(1) A notice of the proposed action to declare void and rescind the
contract shall be made in writing and sent by certified mail, return
receipt requested.
(2) A thirty calendar day period after receipt of the notice, for
the contractor to submit pertinent information before any final decision
is made.
(3) Upon request made within the period for submission of pertinent
information, an opportunity shall be afforded for a hearing at which
witnesses may be presented, and any witness the agency presents may be
confronted. However, no inquiry shall be made regarding the validity of
the conviction.
(4) If the agency head or designee decides to declare void and
rescind the contracts involved, that official shall issue a written
decision which--
[[Page 54]]
(i) States that determination;
(ii) Reflects consideration of the fair value of any tangible
benefits received and retained by the agency; and
(iii) States the amount due, and the property to be returned, to the
agency.
(d) Notice of proposed action. The notice of the proposed action, as
a minimum shall--
(1) Advise that consideration is being given to declaring void and
rescinding contracts awarded by the agency, and recovering the amounts
expended and property transferred therefor, under the provisions of 18
U.S.C. 218;
(2) Specifically identify the contracts affected by the action;
(3) Specifically identify the final conviction upon which the action
is based;
(4) State the amounts expended and property transferred under each
of the contracts involved, and the money and the property demanded to be
returned;
(5) Identify any tangible benefits received and retained by the
agency under the contract, and the value of those benefits, as
calculated by the agency;
(6) Advise that pertinent information may be submitted within 30
calendar days after receipt of the notice, and that, if requested within
that time, a hearing shall be held at which witnesses may be presented
and any witness the agency presents may be confronted; and
(7) Advise that action shall be taken only after the agency head or
designee issues a final written decision on the proposed action.
(e) Final agency decision. The final agency decision shall be based
on the information available to the agency head or designee, including
any pertinent information submitted or, if a hearing was held, presented
at the hearing. If the agency decision declares void and rescinds the
contract, the final decision shall specify the amounts due and property
to be returned to the agency, and reflect consideration of the fair
value of any tangible benefits received and retained by the agency.
Notice of the decision shall be sent promptly by certified mail, return
receipt requested. Rescission of contracts under the authority of the
Act and demand for recovery of the amounts expended and property
transferred therefor, is not a claim within the meaning of the Contract
Disputes Act of 1978 (CDA), 41 U.S.C. 601-613, or part 33. Therefore,
the procedures required by the CDA and the FAR for the issuance of a
final contracting officer decision are not applicable to final agency
decisions under this subpart, and shall not be followed.
Subpart 3.8--Limitations on the Payment of Funds to Influence Federal
Transactions
Source: 55 FR 3190, Jan. 30, 1990, unless otherwise noted.
Sec. 3.800 Scope of subpart.
This subpart prescribes policies and procedures implementing section
319 of the Department of the Interior and Related Agencies
Appropriations Act, Pub. L. 101-121, which added a new section 1352 to
title 31 U.S.C., entitled ``Limitation on use of appropriated funds to
influence certain Federal contracting and financial transactions'' (the
Act).
Sec. 3.801 Definitions.
Agency, as used in this section, means an executive agency as
defined in 2.101.
Covered Federal action, as used in this section, means any of the
following Federal actions:
(a) The awarding of any Federal contract.
(b) The making of any Federal grant.
(c) The making of any Federal loan.
(d) The entering into of any cooperative agreement.
(e) The extension, continuation, renewal, amendment, or modification
of any Federal contract, grant, loan, or cooperative agreement.
Indian tribe and tribal organization, as used in this section, have
the meaning provided in section 4 of the Indian Self-Determination and
Education Assistance Act (25 U.S.C. 450B) and include Alaskan Natives.
Influencing or attempting to influence, as used in this section,
means making, with the intent to influence, any communication to or
appearance before an officer or employee of any agency, a Member of
Congress, an officer or employee of Congress, or an employee of a
[[Page 55]]
Member of Congress in connection with any covered Federal action.
Local government, as used in this section, means a unit of
government in a State and, if chartered, established, or otherwise
recognized by a State for the performance of a governmental duty,
including a local public authority, a special district, an intrastate
district, a council of governments, a sponsor group representative
organization, and any other instrumentality of a local government.
Officer or employee of an agency, as used in this section, includes
the following individuals who are employed by an agency:
(a) An individual who is appointed to a position in the Government
under title 5, United States Code, including a position under a
temporary appointment;
(b) A member of the uniformed services, as defined in subsection
101(3), title 37, United States Code;
(c) A special Government employee, as defined in section 202, title
18, United States Code; and
(d) An individual who is a member of a Federal advisory committee,
as defined by the Federal Advisory Committee Act, title 5, United States
Code, appendix 2.
Person, as used in this section, means an individual, corporation,
company, association, authority, firm, partnership, society, State, and
local government, regardless of whether such entity is operated for
profit or not for profit. This term excludes an Indian tribe, tribal
organization, or any other Indian organization with respect to
expenditures specifically permitted by other Federal law.
Reasonable compensation, as used in this section, means, with
respect to a regularly employed officer or employee of any person,
compensation that is consistent with the normal compensation for such
officer or employee for work that is not furnished to, not funded by, or
not furnished in cooperation with the Federal Government.
Reasonable payment, as used in this section, means, with respect to
professional and other technical services, a payment in an amount that
is consistent with the amount normally paid for such services in the
private sector.
Recipient, as used in this section, includes the contractor and all
subcontractors. This term excludes an Indian tribe, tribal organization,
or any other Indian organization with respect to expenditures
specifically permitted by other Federal law.
Regularly employed, as used in this section, means, with respect to
an officer or employee of a person requesting or receiving a Federal
contract, an officer or employee who is employed by such person for at
least 130 working days within 1 year immediately preceding the date of
the submission that initiates agency consideration of such person for
receipt of such contract. An officer or employee who is employed by such
person for less than 130 working days within 1 year immediately
preceding the date of the submission that initiates agency consideration
of such person shall be considered to be regularly employed as soon as
he or she is employed by such person for 130 working days.
State, as used in this section, means a State of the United States,
the District of Columbia, the Commonwealth of Puerto Rico, a territory
or possession of the United States, an agency or instrumentality of a
State, and multi-State, regional, or interstate entity having
governmental duties and powers.
Sec. 3.802 Prohibitions.
(a) Section 1352 of title 31, United States Code, among other
things, prohibits a recipient of a Federal contract, grant, loan, or
cooperative agreement from using appropriated funds to pay any person
for influencing or attempting to influence an officer or employee of any
agency, a Member of Congress, an officer or employee of Congress, or an
employee of a Member of Congress in connection with any of the following
covered Federal actions: the awarding of any Federal contract; the
making of any Federal grant; the making of any Federal loan; the
entering into of any cooperative agreement; or, the modification of any
Federal contract, grant, loan, or cooperative agreement.
(b) The Act also requires offerors to furnish a declaration
consisting of both a certification and a disclosure. These
[[Page 56]]
requirements are contained in the provision at 52.203-11, Certification
and Disclosure Regarding Payments to Influence Certain Federal
Transactions, and the clause at 52.203-12, Limitation on Payments to
Influence Certain Federal Transactions.
(1) By signing its offer, an offeror certifies that no appropriated
funds have been paid or will be paid in violation of the prohibitions in
31 U.S.C. 1352.
(2) The disclosure shall identify if any funds other than Federal
appropriated funds (including profit or fee received under a covered
Federal action) have been paid, or will be paid, to any person for
influencing or attempting to influence an officer or employee of any
agency, a Member of Congress, an officer or employee of Congress, or an
employee of a Member of Congress in connection with a Federal contract,
grant, loan, or cooperative agreement.
(c) The prohibitions of the Act do not apply under the following
conditions:
(1) Agency and legislative liaison by own employees. (i) The
prohibition on the use of appropriated funds, in paragraph (a) of this
section, does not apply in the case of a payment of reasonable
compensation made to an officer or employee of a person requesting or
receiving a covered Federal action if the payment is for agency and
legislative liaison activities not directly related to a covered Federal
action.
(ii) For purposes of subdivision (c)(1)(i) of this section,
providing any information specifically requested by an agency or
Congress is permitted at any time.
(iii) The following agency and legislative liaison activities are
permitted at any time where they are not related to a specific
solicitation for any covered Federal action:
(A) Discussing with an agency the qualities and characteristics
(including individual demonstrations) of the person's products or
services, conditions or terms of sale, and service capabilities;
(B) Technical discussions and other activities regarding the
application or adaptation of the person's products or services for an
agency's use.
(iv) The following agency and legislative liaison activities are
permitted where they are prior to formal solicitation of any covered
Federal action:
(A) Providing any information not specifically requested but
necessary for an agency to make an informed decision about initiation of
a covered Federal action;
(B) Technical discussions regarding the preparation of an
unsolicited proposal prior to its official submission; and
(C) Capability presentations by persons seeking awards from an
agency pursuant to the provisions of the Small Business Act, as amended
by Pub. L. 95-507, and subsequent amendments.
(v) Only those activities expressly authorized by subparagraph
(c)(1) of this section are permitted under this section.
(2) Professional and technical services. (i) The prohibition on the
use of appropriated funds, in paragraph (a) of this section, does not
apply in the case of--
(A) Payment of reasonable compensation made to an officer or
employee of a person requesting or receiving a covered Federal action or
an extension, continuation, renewal, amendment, or modification of a
covered Federal action, if payment is for professional or technical
services rendered directly in the preparation, submission, or
negotiation of any bid, proposal, or application for that Federal action
or for meeting requirements imposed by or pursuant to law as a condition
for receiving that Federal action;
(B) Any reasonable payment to a person, other than an officer or
employee of a person requesting or receiving a covered Federal action,
if the payment is for professional or technical services rendered
directly in the preparation, submission, or negotiation of any bid,
proposal, or application for that Federal action, or for meeting
requirements imposed by or pursuant to law as a condition for receiving
that Federal action. Persons other than officers or employees of a
person requesting or receiving a covered Federal action include
consultants and trade associations.
(ii) For purposes of subdivision (c)(2)(i) of this section,
``professional and technical services'' shall be limited
[[Page 57]]
to advice and analysis directly applying any professional or technical
discipline. For example, drafting of a legal document accompanying a bid
or proposal by a lawyer is allowable. Similarly, technical advice
provided by an engineer on the performance or operational capability of
a piece of equipment rendered directly in the negotiation of a contract
is allowable. However, communications with the intent to influence made
by a professional (such as a licensed lawyer) or a technical person
(such as a licensed accountant) are not allowable under this section
unless they provide advice and analysis directly applying their
professional or technical expertise and unless the advice or analysis is
rendered directly and solely in the preparation, submission or
negotiation of a covered Federal action. Thus, for example,
communications with the intent to influence made by a lawyer that do not
provide legal advice or analysis directly and solely related to the
legal aspects of his or her client's proposal, but generally advocate
one proposal over another are not allowable under this section because
the lawyer is not providing professional legal services. Similarly,
communications with the intent to influence made by an engineer
providing an engineering analysis prior to the preparation or submission
of a bid or proposal are not allowable under this section since the
engineer is providing technical services but not directly in the
preparation, submission or negotiation of a covered Federal action.
(iii) Requirements imposed by or pursuant to law as a condition for
receiving a covered Federal award include those required by law or
regulation and any other requirements in the actual award documents
(iv) Only those services expressly authorized by subdivisions
(c)(2)(i) (A) and (B) of this section are permitted under this section.
(v) The reporting requirements of 3.803(a) shall not apply with
respect to payments of reasonable compensation made to regularly
employed officers or employees of a person.
Sec. 3.803 Certification and disclosure.
(a) Any contractor who requests or receives a Federal contract
exceeding $100,000 shall submit the certification and disclosures
required by the provision at 52.203-11, Certification and Disclosure
Regarding Payments to Influence Certain Federal Transactions, with its
offer. Disclosures under this section shall be submitted to the
contracting officer using OMB standard form LLL, Disclosure of Lobbying
Activities.
(b) The contractor shall file a disclosure form at the end of each
calendar quarter in which there occurs any event that materially affects
the accuracy of the information contained in any disclosure form
previously filed by such person under paragraph (a) of this section. An
event that materially affects the accuracy of the information reported
includes--
(1) A cumulative increase of $25,000 or more in the amount paid or
expected to be paid for influencing or attempting to influence a covered
Federal action; or
(2) A change in the person(s) or individual(s) influencing or
attempting to influence a covered Federal action; or
(3) A change in the officer(s), employee(s), or Member(s) of
Congress contacted to influence or attempt to influence a covered
Federal action.
(c) The contractor shall require the submittal of a certification,
and if required, a disclosure form, by any person who requests or
receives any subcontract exceeding $100,000 under the Federal contract.
(d) All subcontractor disclosure forms (but not certifications),
shall be forwarded from tier to tier until received by the prime
contractor. The prime contractor shall submit all disclosure forms to
the contracting officer at the end of the calendar quarter in which the
disclosure form is submitted by the subcontractor. Each subcontractor
certification shall be retained in the subcontract file of the awarding
contractor.
[55 FR 3190, Jan. 30, 1990, as amended at 55 FR 38516, Sept. 18, 1990]
[[Page 58]]
Sec. 3.804 Policy.
(a) The contracting officer shall obtain certifications and
disclosures as required by the provision at 52.203-11, Certification and
Disclosure Regarding Payments to Influence Certain Federal Transactions,
prior to the award of any contract exceeding $100,000.
(b) The contracting officer shall forward a copy of all contractor
disclosures furnished pursuant to the clause at 52.203-12, Limitation on
Payments to Influence Certain Federal Transactions, to the official
designated in accordance with agency procedures, for subsequent
submission to Congress. The original of the disclosure shall be retained
in the contract file.
Sec. 3.805 Exemption.
The Secretary of Defense may exempt, on a case-by-case basis, a
covered Federal action from the prohibitions of this section whenever
the Secretary determines, in writing, that such an exemption is in the
national interest. The Secretary shall transmit a copy of such exemption
to Congress immediately after making such a determination.
Sec. 3.806 Processing suspected violations.
Suspected violations of the requirements of the Act shall be
referred to the official designated in agency procedures.
3.807 Civil penalties.
Agencies shall impose and collect civil penalties pursuant to the
provisions of the Program Fraud and Civil Remedies Act, 31 U.S.C. 3803
(except subsection (c)), 3804-3408, and 3812, insofar as the provisions
therein are not inconsistent with the requirements of this subpart.
3.808 Solicitation provision and contract clause.
(a) The provision at 52.203-11, Certification and Disclosure
Regarding Payments to Influence Certain Federal Transactions, shall be
included in solicitations expected to exceed $100,000.
(b) The clause at 52.203-12, Limitation on Payments to Influence
Certain Federal Transactions, shall be included in solicitations and
contracts expected to exceed $100,000.
Subpart 3.9--Whistleblower Protections for Contractor Employees
Source: 60 FR 37776, July 21, 1995, unless otherwise noted.
3.900 Scope of subpart.
This subpart implements 10 U.S.C. 2409 and 41 U.S.C. 251, et seq.,
as amended by Sections 6005 and 6006 of the Federal Acquisition
Streamlining Act of 1994 (Pub. L. 103-355).
3.901 Definitions.
Authorized official of an agency means an officer or employee
responsible for contracting, program management, audit, inspection,
investigation, or enforcement of any law or regulation relating to
Government procurement or the subject matter of the contract.
Authorized official of the Department of Justice means any person
responsible for the investigation, enforcement, or prosecution of any
law or regulation.
Inspector General means an Inspector General appointed under the
Inspector General Act of 1978, as amended. In the Department of Defense
that is the DOD Inspector General. In the case of an executive agency
that does not have an Inspector General, the duties shall be performed
by an official designated by the head of the executive agency.
3.902 Applicability.
This subpart applies to all Government contracts.
3.903 Policy.
Government contractors shall not discharge, demote or otherwise
discriminate against an employee as a reprisal for disclosing
information to a Member of Congress, or an authorized official of an
agency or of the Department of Justice, relating to a substantial
violation of law related to a contract (including the competition for or
negotiation of a contract).
[[Page 59]]
3.904 Procedures for filing complaints.
(a) Any employee of a contractor who believes that he or she has
been discharged, demoted, or otherwise discriminated against contrary to
the policy in 3.903 may file a complaint with the Inspector General of
the agency that awarded the contract.
(b) The complaint shall be signed and shall contain--
(1) The name of the contractor;
(2) The contract number, if known; if not, a description reasonably
sufficient to identify the contract(s) involved;
(3) The substantial violation of law giving rise to the disclosure;
(4) The nature of the disclosure giving rise to the discriminatory
act; and
(5) The specific nature and date of the reprisal.
3.905 Procedures for investigating complaints.
(a) Upon receipt of a complaint, the Inspector General shall conduct
an initial inquiry. If the Inspector General determines that the
complaint is frivolous or for other reasons does not merit further
investigation, the Inspector General shall advise the complainant that
no further action on the complaint will be taken.
(b) If the Inspector General determines that the complaint merits
further investigation, the Inspector General shall notify the
complainant, contractor, and head of the contracting activity. The
Inspector General shall conduct an investigation and provide a written
report of findings to the head of the agency or designee.
(c) Upon completion of the investigation, the head of the agency or
designee shall ensure that the Inspector General provides the report of
findings to--
(1) The complainant and any person acting on the complainant's
behalf;
(2) The contractor alleged to have committed the violation; and
(3) The head of the contracting activity.
(d) The complainant and contractor shall be afforded the opportunity
to submit a written response to the report of findings within 30 days to
the head of the agency or designee. Extensions of time to file a written
response may be granted by the head of the agency or designee.
(e) At any time, the head of the agency or designee may request
additional investigative work be done on the complaint.
3.906 Remedies.
(a) If the head of the agency or designee determines that a
contractor has subjected one of its employees to a reprisal for
providing information to a Member of Congress, or an authorized official
of an agency or of the Department of Justice, the head of the agency or
designee may take one or more of the following actions:
(1) Order the contractor to take affirmative action to abate the
reprisal.
(2) Order the contractor to reinstate the person to the position
that the person held before the reprisal, together with the compensation
(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.
(3) 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.
(b) Whenever a contractor fails to comply with an order, 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 section, the court may grant
appropriate relief, including injunctive relief and compensatory and
exemplary damages.
(c) Any person adversely affected or aggrieved by an order issued
under this section may obtain review of the order's conformance with the
law, and this subpart, 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
[[Page 60]]
shall conform to Chapter 7 of Title 5, United States Code.
PART 4--ADMINISTRATIVE MATTERS--Table of Contents
Sec.
4.000 Scope of part.
Subpart 4.1--Contract Execution
4.101 Contracting officer's signature.
4.102 Contractor's signature.
4.103 Contract clause.
Subpart 4.2--Contract Distribution
4.201 Procedures.
4.202 Agency distribution requirements.
4.203 Taxpayer identification number information.
Subpart 4.3--Paper Documents
Sec.
4.300 Scope of subpart.
4.301 Authority.
4.302 Definition.
4.303 Policy.
4.304 Contract clause.
Subpart 4.4--Safeguarding Classified Information Within Industry
4.401 Definitions.
4.402 General.
4.403 Responsibilities of contracting officers.
4.404 Contract clause.
Subpart 4.5--Electronic Commerce in Contracting
4.500 Scope of subpart.
4.501 Definitions.
4.502 Policy.
4.503 Contractor registration.
4.504 FACNET functions.
4.505 FACNET certification.
4.505-1 Interim certification.
4.505-2 Full certification.
Sec. 264.505-3 Governmentwide certification.
4.505-4 Contract actions excluded.
4.506 Exemptions.
Subpart 4.6--Contract Reporting
4.600 Scope of subpart.
4.601 Record requirements.
4.602 Federal Procurement Data System.
4.603 Solicitation provision.
Subpart 4.7--Contractor Records Retention
4.700 Scope of subpart.
4.701 Purpose.
4.702 Applicability.
4.703 Policy.
4.704 Calculation of retention periods.
4.705 Specific retention periods.
4.705-1 Financial and cost accounting records.
4.705-2 Pay administration records.
4.705-3 Acquisition and supply records.
4.706 [Reserved]
Subpart 4.8--Government Contract Files
4.800 Scope of subpart.
4.801 General.
4.802 Contract files.
4.803 Contents of contract files.
4.804 Closeout of contract files.
4.804-1 Closeout by the office administering the contract.
4.804-2 Closeout of the contracting office files if another office
administers the contract.
4.804-3 Closeout of paying office contract files.
4.804-4 Physically completed contracts.
4.804-5 Detailed procedures for closing out contract files.
4.805 Storage, handling, and disposal of contract files.
Subpart 4.9--Information Reporting to the Internal Revenue Service
4.900 Scope of subpart.
4.901 Definitions.
4.902 Contract information.
4.903 Payment information.
4.904 Solicitation provision.
Authority: 40 U.S.C. 486(c); 10 U.S.C. Chapter 137; and 42 U.S.C.
2473(c).
Source: 48 FR 42113, Sept. 19, 1983, unless otherwise noted.
Sec. 4.000 Scope of part.
This part prescribes policies and procedures relating to the
administrative aspects of contract execution, contractor-submitted paper
documents, distribution, reporting, retention, and files.
[60 FR 28493, May 31, 1995]
Subpart 4.1--Contract Execution
Sec. 4.101 Contracting officer's signature.
Only contracting officers shall sign contracts on behalf of the
United States. The contracting officer's name and official title shall
be typed, stamped, or printed on the contract. The contracting officer
normally signs the contract after it has been signed by the contractor.
The contracting officer
[[Page 61]]
shall ensure that the signer(s) have authority to bind the contractor
(see specific requirements in 4.102 of this subpart).
[60 FR 34736, July 3, 1995]
Sec. 4.102 Contractor's signature.
(a) Individuals. A contract with an individual shall be signed by
that individual. A contract with an individual doing business as a firm
shall be signed by that individual, and the signature shall be followed
by the individual's typed, stamped, or printed name and the words ``, an
individual doing business as .......................'' [insert name of
firm].
(b) Partnerships. A contract with a partnership shall be signed in
the partnership name. Before signing for the Government, the contracting
officer shall obtain a list of all partners and ensure that the
individual(s) signing for the partnership have authority to bind the
partnership.
(c) Corporations. A contract with a corporation shall be signed in
the corporate name, followed by the word ``by'' and the signature and
title of the person authorized to sign. The contracting officer shall
ensure that the person signing for the corporation has authority to bind
the corporation.
(d) Joint venturers. A contract with joint venturers may involve any
combination of individuals, partnerships, or corporations. The contract
shall be signed by each participant in the joint venture in the manner
prescribed in paragraphs (a) through (c) above for each type of
participant. When a corporation is participating, the contracting
officer shall obtain from the corporation secretary a certificate
stating that the corporation is authorized to participate in the joint
venture.
(e) Agents. When an agent is to sign the contract, other than as
stated in paragraphs (a) through (d) above, the agent's authorization to
bind the principal must be established by evidence satisfactory to the
contracting officer.
Sec. 4.103 Contract clause.
The contracting officer shall insert the clause at 52.204-1,
Approval of Contract, in solicitations and contracts if required by
agency procedures.
[49 FR 26741, June 29, 1984]
Subpart 4.2--Contract Distribution
Sec. 4.201 Procedures.
Contracting officers shall distribute copies of contracts or
modifications within 10 working days after execution by all parties. As
a minimum, the contracting officer shall--
(a) Distribute simultaneously one signed copy or reproduction of the
signed contract to the contractor and the paying office;
(b) When a contract is assigned to another office for contract
administration (see subpart 42.2), provide to that office--
(1) One copy or reproduction of the signed contract and of each
modification; and
(2) A copy of the contract distribution list, showing those offices
that should receive copies of modifications, and any changes to the list
as they occur;
(c) Distribute one copy to each accounting and finance office
(funding office) whose funds are cited in the contract;
(d) When the contract is not assigned for administration but
contains a Cost Accounting Standards clause, provide one copy of the
contract to the cognizant administrative contracting officer and mark
the copy ``FOR COST ACCOUNTING STANDARDS ADMINISTRATION ONLY'' (see
30.601(b));
(e) Provide one copy of each contract or modification that requires
audit service to the appropriate field audit office listed in the
``Directory of Federal Contract Audit Offices'' (copies of this
directory can be ordered from the U.S. Government Printing Office,
Superintendent of Documents, Washington, DC 20402, referencing stock
numbers 008-007-03189-9 and 008-007-03190-2 for Volumes I and II,
respectively); and
(f) Provide copies of contracts and modifications to those
organizations required to perform contract administration support
functions (e.g., when
[[Page 62]]
manufacturing is performed at multiple sites, the contract
administration office cognizant of each location).
[48 FR 42113, Sept. 19, 1983, as amended at 60 FR 34736, July 3, 1995]
Sec. 4.202 Agency distribution requirements.
Agencies shall limit additional distribution requirements to the
minimum necessary for proper performance of essential functions. When
contracts are assigned for administration to a contract administration
office located in an agency different from that of the contracting
office (see part 42), the two agencies shall agree on any necessary
distribution in addition to that prescribed in 4.201 above.
Sec. 4.203 Taxpayer identification number information.
(a) If the contractor has furnished a taxpayer identification number
(TIN) when completing the solicitation provision at 52.204-3, Taxpayer
Identification, the contracting officer shall, unless otherwise provided
in agency procedures, attach a copy of the completed solicitation
provision as the last page of the copy of the contract sent to the
paying office.
(b) If the TIN or corporate status is derived from a source other
than the provision at 52.204-3, the last page of the contract forwarded
to the paying office will be annotated to state the contractor's TIN and
corporate status.
[54 FR 34752, Aug. 21, 1989, as amended at 55 FR 52788, Dec. 21, 1990]
Subpart 4.3--Paper Documents
Source: At 60 FR 28493, May 31, 1995, unless otherwise noted.
Sec. 4.300 Scope of subpart.
This subpart provides policies and procedures on contractor-
submitted paper documents.
Sec. 4.301 Authority.
The authority for this subpart is established in Executive Order
12873, Sections 402(d) and 504, October 20, 1993, as amended by
Executive Order 12995, March 25, 1996.
[60 FR 28493, May 31, 1995, as amended at 61 FR 31616, June 20, 1996]
Sec. 4.302 Definition.
Printing/copying double-sided, as used in this subpart, means
printing or reproducing a document so that information is on both sides
of a sheet of paper.
Sec. 4.303 Policy.
It is the policy of the Government that a contractor submitting
paper documents to the Government relating to an acquisition should, if
possible, submit those documents printed/copied double-sided on recycled
paper. If the contractor can only print/copy double-sided or use
recycled paper, the contractor should accomplish whichever one the
contractor has the ability to achieve.
Sec. 4.304 Contract clause.
The contracting officer shall insert the clause at 52.204-4,
Printing/Copying Double-Sided on Recycled Paper, in solicitations and
contracts greater than the simplified acquisition threshold.
[60 FR 28494, May 31, 1995, as amended at 60 FR 34744, July 3, 1995]
Subpart 4.4--Safeguarding Classified Information Within Industry
Sec. 4.401 Definitions.
Classified acquisition means an acquisition that consists of one or
more contracts in which offerors would be required to have access to
classified information (Confidential, Secret, or Top Secret) to properly
submit an offer or quotation, to understand the performance requirements
of a classified contract under the acquisition, or to perform the
contract.
Classified contract means any contract that requires, or will
require, access to classified information (Confidential, Secret, or Top
Secret) by the contractor or its employees in the performance of the
contract. A contract may be a classified contract even though the
contract document is not classified.
Classified information means any information or material, regardless
of its
[[Page 63]]
physical form or characteristics, that is owned by, produced by or for,
or under the control of the United States Government, and determined
pursuant to Executive Order 12356, April 2, 1982 (47 FR 14874, April 6,
1982) or prior orders to require protection against unauthorized
disclosure, and is so designated.
[48 FR 42113, Sept. 19, 1983, as amended at 51 FR 2649, Jan. 17, 1986]
Sec. 4.402 General.
(a) Executive Order 12829, January 6, 1993 (58 FR 3479, January 8,
1993), entitled ``National Industrial Security Program'' (NISP),
establishes a program to safeguard Federal Government classified
information that is released to contractors, licensees, and grantees of
the United States Government. Executive Order 12829 amends Executive
Order 10865, February 20, 1960 (25 FR 1583, February 25, 1960), entitled
``Safeguarding Classified Information Within Industry,'' as amended by
Executive Order 10909, January 17, 1961 (26 FR 508, January 20, 1961).
(b) The National Industrial Security Program Operating Manual
(NISPOM) incorporates the requirements of these Executive Orders. The
Secretary of Defense, in consultation with all affected agencies and
with the concurrence of the Secretary of Energy, the Chairman of the
Nuclear Regulatory Commission, and the Director of Central Intelligence,
is responsible for issuance and maintenance of this Manual. The
following DOD publications implement the program:
(1) National Industrial Security Program Operating Manual (NISPOM)
(DOD 5220.22-M).
(2) Industrial Security Regulation (ISR) (DOD 5220.22-R).
(c) Procedures for the protection of information relating to foreign
classified contracts awarded to U.S. industry, and instructions for the
protection of U.S. information relating to classified contracts awarded
to foreign firms, are prescribed in Chapter 10 of the NISPOM.
(d) Part 27, Patents, Data, and Copyrights, contains policy and
procedures for safeguarding classified information in patent
applications and patents.
[48 FR 42113, Sept. 19, 1983, as amended at 61 FR 31617, June 20, 1996]
Sec. 4.403 Responsibilities of contracting officers.
(a) Presolicitation phase. Contracting officers shall review all
proposed solicitations to determine whether access to classified
information may be required by offerors, or by a contractor during
contract performance.
(1) If access to classified information of another agency may be
required, the contracting officer shall--
(i) Determine if the agency is covered by the NISP; and
(ii) Follow that agency's procedures for determining the security
clearances of firms to be solicited.
(2) If the classified information required is from the contracting
officer's agency, the contracting officer shall follow agency
procedures.
(b) Solicitation phase. Contracting officers shall--
(1) Ensure that the classified acquisition is conducted as required
by the NISP or agency procedures, as appropriate; and
(2) Include (i) an appropriate Security Requirements clause in the
solicitation (see 4.404), and (ii) as appropriate, in solicitations and
contracts when the contract may require access to classified
information, a requirement for security safeguards in addition to those
provided in the clause (52.204-2, Security Requirements).
(c) Award phase. Contracting officers shall inform contractors and
subcontractors of the security classifications and requirements assigned
to the various documents, materials, tasks, subcontracts, and components
of the classified contract as follows:
(1) Agencies covered by the NISP shall use the Contract Security
Classification Specification, DD Form 254. The contracting officer, or
authorized representative, is the approving official for the form and
shall ensure that it is prepared and distributed in accordance with the
ISR.
[[Page 64]]
(2) Contracting officers in agencies not covered by the NISP shall
follow agency procedures.
[48 FR 42113, Sept. 19, 1983, as amended at 61 FR 31617, June 20, 1996]
Sec. 4.404 Contract clause.
(a) The contracting officer shall insert the clause at 52.204-2,
Security Requirements, in solicitations and contracts when the contract
may require access to classified information, unless the conditions
specified in paragraph (d) below apply.
(b) If a cost contract (see 16.302) for research and development
with an educational institution is contemplated, the contracting officer
shall use the clause with its Alternate I.
(c) If a construction or architect-engineer contract where employee
identification is required for security reasons is contemplated, the
contracting officer shall use the clause with its Alternate II.
(d) If the contracting agency is not covered by the NISP and has
prescribed a clause and alternates that are substantially the same as
those at 52.204-2, the contracting officer shall use the agency-
prescribed clause as required by agency procedures.
[48 FR 42113, Sept. 19, 1983, as amended at 61 FR 31617, June 20, 1996]
Subpart 4.5--Electronic Commerce in Contracting
Source: 60 FR 34744, July 3, 1995, unless otherwise noted.
Sec. 4.500 Scope of subpart.
This subpart provides policy and procedures for the establishment
and use of the Federal Acquisition Computer Network (FACNET) as required
by Section 30 of the Office of Federal Procurement Policy (OFPP) Act (41
U.S.C. 426).
Sec. 4.501 Definitions.
ANSI X12, as used in this subpart, means the designation assigned by
the American National Standards Institute (ANSI) for the structure,
format, and content of electronic business transactions conducted
through Electronic Data Interchange (EDI). ANSI is the coordinator and
clearinghouse for national standards in the United States.
Electronic commerce (EC), as used in this subpart, means a paperless
process including electronic mail, electronic bulletin boards,
electronic funds transfer, electronic data interchange, and similar
techniques for accomplishing business transactions. The use of terms
commonly associated with paper transactions (e.g., ``copy'',
``document'', ``page'', ``printed'', ``sealed envelope'' and
``stamped'') shall not be interpreted to restrict the use of electronic
commerce.
Electronic data interchange (EDI), as used in this subpart, means a
technique for electronically transferring and string formatted
information between computers utilizing established and published
formats and codes, as authorized by the applicable Federal Information
Processing Standards.
Implementation convention (IC), as used in this subpart, means the
common practices and/or interpretations of the use of ANSI X12
standards. Conventions define how trading partners will use the
standards for their mutual needs. The Federal IC will be used by
organizational elements of the Federal community and by government
organizations and by Trading Partners to exchange data with the Federal
community.
Trading partner, as used in this subpart, means a business that has
agreed to exchange business information electronically.
Transaction set, as used in this subpart, means the data that is
exchanged to convey meaning between Trading Partners engaged in EC/EDI.
[60 FR 34744, July 3, 1995, as amended at 61 FR 39191, July 26, 1996]
Sec. 4.502 Policy.
(a) The Federal Government shall use FACNET whenever practicable or
cost-effective. Contracting officers may supplement FACNET transactions
by using other media to meet the requirements of any contract action
governed by the FAR (e.g., transmit hard copy of drawings).
(b) Before using FACNET, or any other method of electronic data
interchange, The agency head shall ensure that the electronic data
interchange
[[Page 65]]
system is capable of ensuring authentication and confidentiality
commensurate with the risk and magnitude of the harm from loss, misuse,
or unauthorized access to or modification of the information.
[60 FR 34744, July 3, 1995, as amended at 61 FR 39191, July 26, 1996]
Sec. 4.503 Contractor registration.
(a) In order for a contractor to conduct electronic commerce with
the Federal Government, the contractor must provide registration
information to the Central Contractor Registration (CCR). Phone (800)
EDI-3414 for information regarding FACNET.
(b) The contractor will be required to submit trading partner
profile information, including a Data Universal Numbering System (DUNS)
number, in accordance with the Federal implementation conventions of the
appropriate ANSI X12 transaction set for contractor registration.
[61 FR 39191, July 26, 1996]
Sec. 4.504 FACNET functions.
(a) For agencies--
(1) Provide widespread public notice of contracting opportunities,
and issue solicitations;
(2) Receive responses to solicitations and associated requests for
information;
(3) Provide widespread public notice of contract awards and issuance
of orders (including price);
(4) Receive questions regarding solicitations, if practicable;
(5) Issue contracts and orders, if practicable;
(6) Initiate payments to contractors, if practicable; and
(7) Archive data relating to each procurement action.
(b) For the private sector--
(1) Access notices of solicitation;
(2) Access and review solicitations;
(3) Respond to solicitations;
(4) Receive contracts and orders, if practicable;
(5) Access information on contract awards and issuance of orders;
and
(6) Receive payment by purchase card, electronic funds transfer, or
other automated means, if practicable.
[60 FR 34744, July 3, 1995, as amended at 61 FR 39191, July 26, 1996]
Sec. 4.505 FACNET certification.
Sec. 4.505-1 Interim certification.
(a) A contracting office is considered to have implemented interim
FACNET if--
(1) The contracting office--
(i) Has implemented the FACNET functions described in 4.504(a)(1)
and (2), and (b)(1), (2), and (3); and
(ii) Issues notices of solicitations and receives responses to
solicitations in a system having those functions;
(2) The contracting office can use FACNET for contracts, not
otherwise exempted (see 4.506), that exceed the micro-purchase threshold
but do not exceed the simplified acquisition threshold; and
(3) the senior procurement executive of the agency, or the Under
Secretary of Defense for Acquisition and Technology for the military
departments and defense agencies, has certified to the Administrator of
OFPP that the contracting office has implemented interim FACNET.
(b) The senior procurement executive of the agency, or the Under
Secretary of Defense for Acquisition and Technology for the military
departments and defense agencies, shall notify the private sector via
the Commerce Business Daily that a contracting office of the agency has
certified interim FACNET. The notice shall establish a date after which
it will be required that all responses to solicitations issued by the
contracting office through FACNET, must be submitted through FACNET,
unless otherwise authorized.
Sec. 4.505-2 Full certification.
(a) An agency is considered to have implemented full FACNET if--
(1) The agency has implemented all of the FACNET functions described
in 4.504;
(2) During the entire preceding fiscal year, more than 75 percent of
the agency's eligible contracts, not otherwise exempted (see 4.506),
that exceeded the micro-purchase threshold but did not
[[Page 66]]
exceed the simplified acquisition threshold, were entered into vai
FACNET; and.
(3) The head of the agency, with the concurrence of the
Administrator of OFPP, has certified to the Congress that the agency has
implemented full FACNET. For the Department of Defense, the
certification shall be made by the Secretary of Defense for the
Department as a whole.
(b) Eligible contracts do not include any class or classes of
contracts that the Federal Acquisition Regulatory Council determines,
after October 13, 1997, are not suitable for acquisition through FACNET.
Sec. 4.505-3 Governmentwide certification.
The Federal Government is considered to have implemented
Governmentwide FACNET if--
(a) During the preceding fiscal year, at least 75 percent of
eligible contracts entered into by executive agencies, that exceeded the
micro-purchase threshold but did not exceed the simplified acquisition
threshold, were made via full FACNET; and
(b) the Administrator of OFPP has certified implementation of
Governmentwide FACNET to the Congress.
Sec. 4.505-4 Contract actions excluded.
For purposes of calculating the percentage of FACNET use referred to
in 4.505-2 and 4.505-3, actions issued against established contracts,
such as delivery orders, task orders, and in-scope modifications, shall
not be included.
Sec. 4.506 Exemptions.
The following are exempted from the use of FACNET as specified and
shall not be considered when determining compliance with the
requirements to implement FACNET:
(a) Interim FACNET. (1) Classes of procurements exempted by the head
of the contracting activity after a written determination is made that
FACNET processing of those procurements is not cost-effective or
practicable; and specific purchases for which the contracting officer
determines that it is not practicable or cost-effective to process via
FACNET. Such determinations shall be centrally maintained at the
contracting office.
(2) Contracts that do not require notice under subpart 5.2.
(b) Full FACNET. Contracts awarded by a contracting office (or a
portion of a contracting office), if the office is exempted from use of
FACNET by the head of the agency, or the Secretary of Defense for the
military departments and defense agencies. Any such exemption shall be
based on a written determination that FACNET processing is not cost-
effective or practicable for the contracting office, or portions
thereof. Determinations shall be maintained in the office of the senior
procurement executive, or the Under Secretary of Defense for Acquisition
and Technology for the military departments and defense agencies.
Subpart 4.6--Contract Reporting
Sec. 4.600 Scope of subpart.
This subpart prescribes uniform reporting requirements for the
Federal Procurement Data System (FPDS).
Sec. 4.601 Record requirements.
(a) Each executive agency shall establish and maintain for a period
of 5 years a computer file, by fiscal year, containing unclassified
records of all procurements exceeding $25,000.
(b) With respect to each procurement carried out using competitive
procedures, agencies shall be able to access from the computer file, as
a minimum, the following information:
(1) The date of contract award.
(2) Information identifying the source to whom the contract was
awarded.
(3) The property or services obtained by the Government under the
procurement.
(4) The total cost of the procurement.
(5) Those procurements which result in the submission of a single
bid or proposal so that they can be separately categorized and
designated noncompetitive procurements using competitive procedures.
(c) In addition to paragraph (b) of this section with respect to
each procurement carried out using procedures other than competitive
procedures,
[[Page 67]]
agencies shall be able to access from the computer file--
(1) The reason under subpart 6.3 for the use of such procedures; and
(2) The identity of the organization or activity which conducted the
procurement.
(d) In addition to the information described in paragraphs (b) and
(c) of this section, for procurements in excess of $25,000, agencies
shall be able to access information on the following from the computer
file:
(1) Awards to small disadvantaged businesses using either set-asides
or full and open competition.
(2) Awards to business concerns owned and controlled by women.
(3) The number of offers received in response to a solicitation.
(4) Task or delivery order contracts.
(5) Contracts for the acquisition of commercial items.
(e) This information shall be transmitted to the Federal Procurement
Data System in accordance with agency procedures.
[50 FR 52429, Dec. 23, 1985, as amended at 52 FR 19802, May 27, 1987; 60
FR 42653, Aug. 16, 1995]
Sec. 4.602 Federal Procurement Data System.
(a) The FPDS provides a comprehensive mechanism for assembling,
organizing, and presenting contract placement data for the Federal
Government. Federal agencies report data to the Federal Procurement Data
Center (FPDC), which collects, processes, and disseminates official
statistical data on Federal contracting. The data provide (1) a basis
for recurring and special reports to the President, the Congress, the
General Accounting Office, Federal executive agencies, and the general
public; (2) a means of measuring and assessing the impact of Federal
contracting on the Nation's economy and the extent to which small, small
disadvantaged and women-owned small business concerns are sharing in
Federal contracts; and (3) data for other policy and management control
purposes.
(b) The FPDS Reporting Manual provides a complete list of reporting
and nonreporting agencies and organizations. This manual (available at
no charge from the General Services Administration, Federal Procurement
Data Center, 7th & D Streets SW., room 5652, Washington, DC 20407,
telephone (202) 401-1529, FTS 441-1529, FAX (202) 401-1546) provides the
necessary instruction to the data collection point in each agency as to
what data are required and how often to provide the data.
(c) Data collection points in each agency report data on SF 279,
Federal Procurement Data System (FPDS) Individual Contract Action
Report, and SF 281, Federal Procurement Data System (FPDS) Summary
Contract Action Report ($25,000 or Less), or computer-generated
equivalent. Although the SF 279 and SF 281 are not mandatory for use by
the agencies, they do provide the mandatory format for submitting data
to the FPDS.
(d) The contracting officer shall obtain and report a Contractor
Establishment Code for each awardee from information on file or
available to the contracting office. The contracting office or other
designated agency office shall request a code using the procedures in
the FPDS Reporting Manual or in accordance with agency procedures.
Requests for codes shall be made by Government offices and only for the
apparent awardees.
[48 FR 42113, Sept. 19. 1983. Redesignated at 50 FR 52429, Dec. 23,
1985, and amended at 54 FR 29280, July 11, 1989; 53 FR 43388, Oct. 26,
1988; 55 FR 52788, Dec. 21, 1990; 56 FR 41744, Aug. 22, 1991; 57 FR
60572, Dec. 21, 1992; 60 FR 48259, Sept. 18, 1995]
Sec. 4.603 Solicitation provision.
The contracting officer shall insert the provision at 52.204-5,
Women-Owned Business, in all solicitations that are not set aside for
small business concerns and that exceed the simplified acquisition
threshold, when the contract is to be performed inside the United
States, its territories or possessions, Puerto Rico, the Trust Territory
of the Pacific Islands, or the District of Columbia.
[60 FR 48259, Sept. 18, 1995, as amended at 61 FR 39190, July 26, 1996]
[[Page 68]]
Subpart 4.7--Contractor Records Retention
Sec. 4.700 Scope of subpart.
This subpart provides policies and procedures for retention of
records by contractors to meet the records review requirements of the
Government. In this subpart, the terms ``contracts'' and ``contractors''
include ``subcontracts'' and ``subcontractors.''
Sec. 4.701 Purpose.
The purpose of this subpart is to generally describe records
retention requirements and to allow reductions in the retention period
for specific classes of records under prescribed circumstances.
Sec. 4.702 Applicability.
(a) This subpart applies to records generated under contracts that
contain one of the following clauses:
(1) Audit and Records--Sealed Bidding (52.214-26).
(2) Audit and Records--Negotiation (52.215-2).
(3) Audit--Commercial Items (52.215-43).
(b) This subpart is not mandatory on Department of Energy contracts
for which the Comptroller General allows alternative records retention
periods. Apart from this exception, this subpart applies to record
retention periods under contracts that are subject to Chapter 137, Title
10, U.S.C., and the Federal Property and Administrative Services Act of
1949, as amended, 40 U.S.C. 471 et seq.
[48 FR 42113, Sept. 19, 1983, as amended at 50 FR 1727, Jan. 11, 1985;
50 FR 52429, Dec. 23, 1985; 60 FR 42650, Aug. 16, 1995; 60 FR 48211,
Sept. 18, 1995]
Sec. 4.703 Policy.
(a) Except as stated in 4.703(b), contractors shall make available
records, which includes books, documents, accounting procedures and
practices, and other data, regardless of type and regardless of whether
such items are in written form, in the form of computer data, or in any
other form, and other supporting evidence to satisfy contract
negotiation, administration, and audit requirements of the contracting
agencies and the Comptroller General for (1) 3 years after final payment
or, for certain records, (2) the period specified in 4.705 through
4.705-3, whichever of these periods expires first.
(b) Contractors shall make available the foregoing records and
supporting evidence for a longer period of time than is required in
4.703(a) if--
(1) A retention period longer than that cited in 4.703(a) is
specified in any contract clause; or
(2) The contractor, for its own purposes, retains the foregoing
records and supporting evidence for a longer period. Under this
circumstance, the retention period shall be the period of the
contractor's retention or 3 years after final payment, whichever period
expires first.
(3) The contractor does not meet the original 90-day due date for
submission of final indirect cost rate proposals specified in
subparagraph (d)(2) of the clause at 52.216-7, Allowable Cost and
Payment, and subparagraph (c)(2) of the clause at 52.216-13, Allowable
Cost and Payment--Facilities. Under these circumstances, the retention
periods in 4.705 shall be automatically extended one day for each day
the proposal is not submitted after the original 90-day due date.
(c) Nothing in this section shall be construed to preclude a
contractor from duplicating or storing original records in electronic
form unless they contain significant information not shown on the record
copy. Original records need not be maintained or produced in an audit if
the contractor or subcontractor provides photographic or electronic
images of the original records and meets the following requirements:
(1) The contractor or subcontractor has established procedures to
ensure that the imaging process preserves accurate images of the
original records, including signatures and other written or graphic
images, and that the imaging process is reliable and secure so as to
maintain the integrity of the records.
(2) The contractor or subcontractor maintains an effective indexing
system to permit timely and convenient access to the imaged records.
[[Page 69]]
(3) The contractor or subcontractor retains the original records for
a minimum of one year after imaging to permit periodic validation of the
imaging systems.
(d) If the information described in paragraph (a) of this section is
maintained on a computer, contractors shall retain the computer data on
a reliable medium for the time periods prescribed. Contractors may
transfer computer data in machine readable form from one reliable
computer medium to another. Contractors' computer data retention and
transfer procedures shall maintain the integrity, reliability, and
security of the original computer data. Contractors shall also retain an
audit trail describing the data transfer. For the record retention time
periods prescribed, contractors shall not destroy, discard, delete, or
write over such computer data.
[48 FR 42113, Sept. 19, 1983, as amended at 51 FR 2649, Jan. 17, 1986;
53 FR 43388, Oct. 26, 1988; 54 FR 48982, Nov. 28, 1989; 59 FR 67015,
Dec. 28, 1994; 60 FR 42650, Aug. 16, 1995]
Sec. 4.704 Calculation of retention periods.
(a) The retention periods in 4.705 are calculated from the end of
the contractor's fiscal year in which an entry is made charging or
allocating a cost to a Government contract or subcontract. If a specific
record contains a series of entries, the retention period is calculated
from the end of the contractor's fiscal year in which the final entry is
made. The contractor should cut off the records in annual blocks and
retain them for block disposal under the prescribed retention periods.
(b) When records generated during a prior contract are relied upon
by a contractor for cost or pricing data in negotiating a succeeding
contract, the prescribed periods shall run from the date of the
succeeding contract.
(c) If two or more of the record categories described in 4.705 are
interfiled and screening for disposal is not practical, the contractor
shall retain the entire record series for the longest period prescribed
for any category of records.
Sec. 4.705 Specific retention periods.
The contractor shall retain the records identified in 4.705-1
through 4.705-3 for the periods designated, provided retention is
required under 4.702. Records are identified in this subpart in terms of
their purpose or use and not by specific name or form number. Although
the descriptive identifications may not conform to normal contractor
usage or filing practices, these identifications apply to all contractor
records that come within the description.
Sec. 4.705-1 Financial and cost accounting records.
(a) Accounts receivable invoices, adjustments to the accounts,
invoice registers, carrier freight bills, shipping orders, and other
documents which detail the material or services billed on the related
invoices: Retain 4 years.
(b) Material, work order, or service order files, consisting of
purchase requisitions or purchase orders for material or services, or
orders for transfer of material or supplies: Retain 4 years.
(c) Cash advance recapitulations, prepared as posting entries to
accounts receivable ledgers for amounts of expense vouchers prepared for
employees' travel and related expenses: Retain 4 years.
(d) Paid, canceled, and voided checks, other than those issued for
the payment of salary and wages: Retain 4 years.
(e) Accounts payable records to support disbursements of funds for
materials, equipment, supplies, and services, containing originals or
copies of the following and related documents: remittance advices and
statements, vendors' invoices, invoice audits and distribution slips,
receiving and inspection reports or comparable certifications of receipt
and inspection of material or services, and debit and credit memoranda:
Retain 4 years.
(f) Labor cost distribution cards or equivalent documents: Retain 2
years.
(g) Petty cash records showing description of expenditures, to whom
paid, name of person authorizing payment, and date, including copies of
vouchers and other supporting documents: Retain 2 years.
Sec. 4.705-2 Pay administration records.
(a) Payroll sheets, registers, or their equivalent, of salaries and
wages paid
[[Page 70]]
to individual employees for each payroll period; change slips; and tax
withholding statements: Retain 4 years.
(b) Clock cards or other time and attendance cards: Retain 2 years.
(c) Paid checks, receipts for wages paid in cash, or other evidence
of payments for services rendered by employees: Retain 2 years.
Sec. 4.705-3 Acquisition and supply records.
(a) Store requisitions for materials, supplies, equipment, and
services: Retain 2 years.
(b) Work orders for maintenance and other services: Retain 4 years.
(c) Equipment records, consisting of equipment usage and status
reports and equipment repair orders: Retain 4 years.
(d) Expendable property records, reflecting accountability for the
receipt and use of material in the performance of a contract: Retain 4
years.
(e) Receiving and inspection report records, consisting of reports
reflecting receipt and inspection of supplies, equipment, and materials:
Retain 4 years.
(f) Purchase order files for supplies, equipment, material, or
services used in the performance of a contract; supporting documentation
and backup files including, but not limited to, invoices, and memoranda;
e.g., memoranda of negotiations showing the principal elements of
subcontract price negotiations (see 52.244-1 and 52.244-2): Retain 4
years.
(g) Production records of quality control, reliability, and
inspection: Retain 4 years.
4.706 [Reserved]
Subpart 4.8--Government Contract Files
Sec. 4.800 Scope of subpart.
This subpart prescribes requirements for establishing, maintaining,
and disposing of contract files for all contractual actions. The
application of this subpart to contracts awarded using the simplified
acquisition procedures covered by part 13 is optional. (See also
documentation requirements in 13.106-2(d).)
[60 FR 34746, July 3, 1995, as amended at 61 FR 39191, July 26, 1996]
Sec. 4.801 General.
(a) The head of each office performing contracting, contract
administration, or paying functions shall establish files containing the
records of all contractual actions.
(b) The documentation in the files (see 4.803) shall be sufficient
to constitute a complete history of the transaction for the purpose of--
(1) Providing a complete background as a basis for informed
decisions at each step in the acquisition process;
(2) Supporting actions taken;
(3) Providing information for reviews and investigations; and
(4) Furnishing essential facts in the event of litigation or
congressional inquiries.
(c) The files to be established include--
(1) A file for cancelled solicitations;
(2) A file for each contract; and
(3) A file such as a contractor general file, containing documents
relating--for example--to (i) no specific contract, (ii) more than one
contract, or (iii) the contractor in a general way (e.g., contractor's
management systems, past performance, or capabilities).
Sec. 4.802 Contract files.
(a) A contract file should generally consist of--
(1) The contracting office contract file, which shall document the
basis for the acquisition and the award, the assignment of contract
administration (including payment responsibilities), and any subsequent
actions taken by the contracting office;
(2) The contract administration office contract file, which shall
document actions reflecting the basis for and the performance of
contract administration responsibilities; and
(3) The paying office contract file, which shall document actions
prerequisite to, substantiating, and reflecting contract payments.
(b) Normally, each file should be kept separately; however, if
appropriate, any or all of the files may be combined;
[[Page 71]]
e.g., if all functions or any combination of the functions are performed
by the same office.
(c) Files shall be maintained at organizational levels that shall
ensure--
(1) Effective documentation of contract actions;
(2) Ready accessibility to principal users;
(3) Minimal establishment of duplicate and working files;
(4) The safeguarding of classified documents; and
(5) Conformance with agency regulations for file location and
maintenance.
(d) If the contract files or file segments are decentralized (e.g.,
by type or function) to various organizational elements or to other
outside offices, responsibility for their maintenance shall be assigned.
A central control and, if needed, a locator system should be established
to ensure the ability to locate promptly any contract files.
(e) Contents of contract files that are proprietary or source
selection information as defined in 3.104-4 shall be protected from
disclosure to unauthorized persons (see 3.104-5).
(f) Agencies may retain contract files in any medium (paper,
electronic, microfilm, etc.) or any combination of media, as long as the
requirements of this subpart are satisfied.
[48 FR 42113, Sept. 19, 1983, as amended at 54 FR 20496, May 11, 1989;
55 FR 36794, Sept. 6, 1990; 59 FR 67016, Dec. 28, 1994]
Sec. 4.803 Contents of contract files.
The following are examples of the records normally contained, if
applicable, in contract files:
(a) Contracting office contract file. (1) Purchase request,
acquisition planning information, and other presolicitation documents.
(2) Justifications and approvals, determinations and findings, and
associated documents.
(3) Evidence of availability of funds.
(4) Synopsis of proposed acquisition as published in the Commerce
Business Daily or reference thereto.
(5) The list of sources solicited, and a list of any firms or
persons whose requests for copies of the solicitation were denied,
together with the reasons for denial.
(6) Set-aside decision.
(7) Government estimate of contract price.
(8) A copy of the solicitation and all amendments thereto.
(9) Security requirements and evidence of required clearances.
(10) A copy of each offer or quotation, the related abstract, and
records of determinations concerning late offers or quotations.
Unsuccessful offers or quotations may be maintained separately, if
cross-referenced to the contract file. The only portions of the
unsuccessful offer or quotation that need be retained are--
(i) Completed solicitation sections A, B, and K;
(ii) Technical and management proposals;
(iii) Cost/price proposals;
(iv) Any other pages of the solicitation that the offeror or quoter
has altered or annotated.
(11) Contractor's certifications and representatives.
(12) Preaward survey reports or reference to previous preaward
survey reports relied upon.
(13) Source selection documentation.
(14) Contracting officer's determination of the contractor's
responsibility.
(15) Small Business Administration Certificate of Competency.
(16) Records of contractor's compliance with labor policies
including equal employment opportunity policies.
(17) Cost or pricing data and Certificates of Current Cost or
Pricing Data or a required justification for waiver, or information
other than cost or pricing data.
(18) Packaging and transportation data.
(19) Cost or price analysis.
(20) Audit reports or reasons for waiver.
(21) Record of negotiation.
(22) Justification for type of contract.
(23) Authority for deviations from this regulation, statutory
requirements, or other restrictions.
(24) Required approvals of award and evidence of legal review.
(25) Notice of award.
[[Page 72]]
(26) The original of (i) the signed contract or award, (ii) all
contract modifications, and (iii) documents supporting modifications
executed by the contracting office.
(27) Synopsis of award or reference thereto.
(28) Notice to unsuccessful quoters or offerors and record of any
debriefing.
(29) Acquisition management reports (see subpart 4.6).
(30) Bid, performance, payment, or other bond documents, or a
reference thereto, and notices to sureties.
(31) Report of postaward conference.
(32) Notice to proceed, stop orders, and any overtime premium
approvals granted at the time of award.
(33) Documents requesting and authorizing modification in the normal
assignment of contract administration functions and responsibility.
(34) Approvals or disapprovals of requests for waivers or deviations
from contract requirements.
(35) Rejected engineering change proposals. These proposals may be
filed separately for early disposal (see 4.805(h)).
(36) Royalty, invention, and copyright reports (including invention
disclosures) or reference thereto.
(37) Contract completion documents.
(38) Documentation regarding termination actions for which the
contracting office is responsible.
(39) Cross-references to pertinent documents that are filed
elsewhere.
(40) Any additional documents on which action was taken or that
reflect actions by the contracting office pertinent to the contract.
(41) A current chronological list identifying the awarding and
successor contracting officers, with inclusive dates of responsibility.
(42) All certifications required by 3.104-9(e)(1).
(43) For contracts and contract modifications in excess of $100,000,
a record of all persons or classes of persons authorized to have access
to proprietary or source selection information and, to the maximum
extent practicable, the names of all individuals within the class.
(b) Contract administration office contract file. (1) Copy of the
contract and all modifications, together with official record copies of
supporting documents executed by the contract administration office.
(2) Any document modifying the normal assignment of contract
administration functions and responsibility.
(3) Security requirements.
(4) Cost or pricing data, Certificates of Current Cost or Pricing
Data, or information other than cost or pricing data; cost or price
analysis; and other documentation supporting contractual actions
executed by the contract administration office.
(5) Preaward survey information.
(6) Purchasing system information.
(7) Consent to subcontract or purchase.
(8) Performance and payment bonds and surety information.
(9) Postaward conference records.
(10) Orders issued under the contract.
(11) Notice to proceed and stop orders.
(12) Insurance policies or certificates of insurance or references
to them.
(13) Documents supporting advance or progress payments.
(14) Progressing, expediting, and production surveillance records.
(15) Quality assurance records.
(16) Property administration records.
(17) Documentation regarding termination actions for which the
contract administration office is responsible.
(18) Cross reference to other pertinent documents that are filed
elsewhere.
(19) Any additional documents on which action was taken or that
reflect actions by the contract administration office pertinent to the
contract.
(20) Contract completion documents.
(c) Paying office contract file. (1) Copy of the contract and any
modifications.
(2) Bills, invoices, vouchers, and supporting documents.
(3) Record of payments or receipts.
(4) Other pertinent documents.
[48 FR 42113, Sept. 19, 1983, as amended at 50 FR 1727, Jan. 11, 1985;
50 FR 52429, Dec. 23, 1985; 54 FR 5054, Jan. 31, 1989; 55 FR 36794,
Sept. 6, 1990; 60 FR 48211, Sept. 18, 1995; 61 FR 39188, July 26, 1996]
[[Page 73]]
4.804 Closeout of contract files.
Sec. 4.804-1 Closeout by the office administering the contract.
(a) Except as provided in paragraph (c) below, time standards for
closing out contract files are as follows:
(1) Files for contracts using simplified acquisition procedures
should be considered closed when the contracting officer receives
evidence of receipt of property and final payment, unless otherwise
specified by agency regulations.
(2) Files for firm-fixed-price contracts, other than those using
simplified acquisition procedures, should be closed within 6 months
after the date on which the contracting officer receives evidence of
physical completion.
(3) Files for contracts requiring settlement of indirect cost rates
should be closed within 36 months of the month in which the contracting
officer receives evidence of physical completion.
(4) Files for all other contracts should be closed within 20 months
of the month in which the contracting officer receives evidence of
physical completion.
(b) When closing out the contract files at 4.804-1(a)(2), (3), and
(4), the contracting officer shall use the closeout procedures at 4.804-
5. However, these closeout actions may be modified to reflect the extent
of administration that has been performed. Quick closeout procedures
(see 42.708) should be used, when appropriate, to reduce administrative
costs and to enable deobligation of excess funds.
(c) A contract file shall not be closed if (1) the contract is in
litigation or under appeal, or (2) in the case of a termination, all
termination actions have not been completed.
[48 FR 42113, Sept. 19, 1983, as amended at 54 FR 34752, Aug. 21, 1989;
60 FR 34746, July 3, 1995]
Sec. 4.804-2 Closeout of the contracting office files if another office administers the contract.
(a) Contract files for contracts using simplified acquisition
procedures should be considered closed when the contracting officer
receives evidence of receipt of property and final payment, unless
otherwise specified by agency regulation.
(b) All other contract files shall be closed as soon as practicable
after the contracting officer receives a contract completion statement
from the contract administration office. The contracting officer shall
ensure that all contractual actions required have been completed and
shall prepare a statement to that effect. This statement is authority to
close the contract file and shall be made a part of the official
contract file.
[48 FR 42113, Sept. 19, 1983, as amended at 60 FR 34746, July 3, 1995]
Sec. 4.804-3 Closeout of paying office contract files.
The paying office shall close the contract file upon issuance of the
final payment voucher.
Sec. 4.804-4 Physically completed contracts.
(a) Except as provided in paragraph (b) below, a contract is
considered to be physically completed when--
(1)(i) The contractor has completed the required deliveries and the
Government has inspected and accepted the supplies;
(ii) The contractor has performed all services and the Government
has accepted these services; and
(iii) All option provisions, if any, have expired; or
(2) The Government has given the contractor a notice of complete
contract termination.
(b) Facilities contracts and rental, use, and storage agreements are
considered to be physically completed when--
(1) The Government has given the contractor a notice of complete
contract termination; or
(2) The contract period has expired.
Sec. 4.804-5 Detailed procedures for closing out contract files.
(a) The office administering the contract is responsible for
initiating (automated or manual) administrative closeout of the contract
after receiving evidence of its physical completion. At the outset of
this process, an initial contract funds status review shall be
accomplished and, where appropriate,
[[Page 74]]
excess funds identified to the contracting office. When complete, the
administrative closeout procedures shall ensure that--
(1) Disposition of classified material is completed;
(2) Final patent report is cleared;
(3) Final royalty report is cleared;
(4) There is no outstanding value engineering change proposal;
(5) Plant clearance report is received;
(6) Property clearance is received;
(7) All interim or disallowed costs are settled;
(8) Price revision is completed;
(9) Subcontracts are settled by the prime contractor;
(10) Prior year indirect cost rates are settled;
(11) Termination docket is completed;
(12) Contract audit is completed;
(13) Contractor's closing statement is completed;
(14) Contractor's final invoice has been submitted; and
(15) Contract funds review is completed and deobligation of any
excess funds is recommended.
(b) When the actions in paragraph (a) above have been verified, the
contracting officer administering the contract shall ensure that a
contract completion statement, containing the following information, is
prepared:
(1) Contract administration office name and address (if different
from the contracting office).
(2) Contracting office name and address.
(3) Contract number.
(4) Last modification number.
(5) Last call or order number.
(6) Contractor name and address.
(7) Dollar amount of excess funds, if any.
(8) Voucher number and date, if final payment has been made.
(9) Invoice number and date, if the final approved invoice has been
forwarded to a disbursing office of another agency or activity and the
status of the payment is unknown.
(10) A statement that all required contract administration actions
have been fully and satisfactorily accomplished.
(11) Name and signature of the contracting officer.
(12) Date.
(c) When the statement is completed, the contracting officer shall
ensure that--
(1) The signed original is placed in the contracting office contract
file (or forwarded to the contracting office for placement in the files
if the contract administration office is different from the contracting
office); and
(2) A signed copy is placed in the appropriate contract
administration file if administration is performed by a contract
administration office.
[48 FR 42113, Sept. 19, 1983, as amended at 54 FR 34752, Aug. 21, 1989]
Sec. 4.805 Storage, handling, and disposal of contract files.
(a) Agencies shall prescribe procedures for the handling, storing,
and disposing of contract files. Such procedures shall take into account
documents held in other than paper format, such as microfilm and various
electronic media. The original medium on which the document was created
may be changed to facilitate storage as long as the requirements of part
4, law and other regulations are satisfied. The process used to create
and store records must record and reproduce the original document,
including signatures and other written and graphic images completely,
accurately, and clearly. Data transfer, storage, and retrieval
procedures shall protect the original data from alteration. Unless law
or other regulations require signed originals to be kept, they may be
destroyed after the record copies on alternate media and copies
reproduced from the record copy are verified to be accurate, complete
and clear representations of the originals. Agency procedures for
contract file disposal shall include provisions that the documents
specified in paragraph (b) of this section shall not be destroyed before
the times indicated. When original documents have been converted to
alternate media for storage, the requirements in paragraph (b) of this
section shall apply to the record copies on the alternate media instead
of the original documents.
(b) If administrative records are mixed with program records and
cannot be economically segregated, the
[[Page 75]]
entire file should be kept for the period of time approved for the
program records. Similarly, if documents, specified below, are part of a
subject or case file which documents activities different from those
specified below, they should be treated in the same manner as the files
of which they are a part.
------------------------------------------------------------------------
Document Retention Period
------------------------------------------------------------------------
(1) Records pertaining to exceptions or Until final clearance or
protests, claims for or against the settlement, or until the
United States, investigations, cases retention period otherwise
pending or in litigation, or similar specified for the document in
matters. paragraphs (b)(2) through
(13) below is completed,
whichever is later.
(2) Signed originals of construction 6 years and 3 months after
contracts over $2,000 and all other initial payment.
contracts over $25,000.
(3) Signed originals of justifications 6 years and 3 months after
and approvals and determinations and final payment.
findings required by part 6, and copies
of supporting documents and data.
(4) Signed originals of construction 3 years after final payment.
contracts of $2,000 or less and all
other contracts of $25,000 or less.
(5) Unsuccessful offers or quotations Retain 1 year after date of
that pertain to contracts using award or until final payment,
simplified acquisition procedures. whichever is later; but if
the contracting officer
determines that the files
have future value to the
Government, retain as long as
advisable.
(6) Contract status (progressing), 6 months after final payment.
expediting, and production surveillance
records.
(7) Rejected engineering change 6 months after final payment.
proposals.
(8) Labor compliance records, including 3 years after final payment.
equal employment opportunity records.
(9) Documents pertaining generally to Until superseded or obsolete.
the contractor as described at
4.801(c)(3).
(10) Records or documents other than 1 year after final payment.
those in paragraphs 4.805(b) (1)-(9) of
this section pertaining to contracts
using simplified acquisition
procedures.
(11) Records or documents other than 6 years and 3 months after
those in paragraphs 4.805(b) (1)-(10) final payment.
of this section pertaining to contracts
not using simplified acquisition
procedures.
(12) Files for cancelled solicitations 5 years after cancellation.
(see 4.801(c)(1)).
(13) Solicited and unsolicited ..............................
unsuccessful offers and quotations
above the simplified acquisition
threshold:
(i) When filed separately from Until contract completion
contract case files. date.
(ii) When filed with contract case 6 years and 3 months after
files. final payment.
------------------------------------------------------------------------
(c) Documents listed in paragraph (b)(1) under ``Document'' shall
not be destroyed until final clearance or settlement.
[48 FR 42113, Sept. 19, 1983, as amended at 50 FR 1727, Jan. 11, 1985;
50 FR 52429, Dec. 23, 1985; 54 FR 5054, Jan. 31, 1989; 57 FR 60573, Dec.
21, 1992; 59 FR 67016, Dec. 28, 1994; 60 FR 34746, July 3, 1995; 61 FR
39190, July 26, 1996]
Subpart 4.9--Information Reporting to the Internal Revenue Service
Source: 57 FR 44260, Sept. 24, 1992, unless otherwise noted.
Sec. 4.900 Scope of subpart.
This subpart provides policies and procedures applicable to
reporting contract and payment information to the Internal Revenue
Service (IRS).
Sec. 4.901 Definitions.
Common parent, as used in this subpart, means that corporate entity
that owns or controls an affiliated group of corporations that files its
Federal income tax returns on a consolidated basis, and of which the
offeror is a member.
Corporate status, as used in this subpart, means a designation as to
whether the offeror is a corporate entity, an unincorporated entity
(e.g., sole proprietorship or partnership), or a corporation providing
medical and health care services.
Taxpayer Identification Number (TIN), as used in this subpart, means
the number required by the IRS to be used by the offeror in reporting
income tax and other returns.
Sec. 4.902 Contract information.
(a) 26 U.S.C. 6050M, as implemented in 26 CFR, requires heads of
Federal executive agencies to report certain information to the IRS.
(b)(1) The required information applies to contract modifications--
[[Page 76]]
(i) Increasing the amount of a contract awarded before January 1,
1989, by $50,000 or more; and
(ii) Entered into on or after April 1, 1990.
(2) The reporting requirement also applies to certain contracts and
modifications thereto in excess of $25,000 entered into on or after
January 1, 1989.
(c) The information to report is--
(1) Name, address, and the Taxpayer Identification Number (TIN) of
contractor;
(2) Name and TIN of common parent (if any);
(3) Date of the contract action;
(4) Amount obligated on the contract action; and
(5) Estimated contract completion date.
(d) Transmit the information to the IRS through the Federal
Procurement Data System (see subpart 4.6 and implementing instructions).
Sec. 4.903 Payment information.
(a) 26 U.S.C. 6041 and 6041A, as implemented in 26 CFR, in part,
require payors, including Federal Government agencies, to report to the
IRS payments made to certain contractors.
(b) The following payments are exempt from this reporting
requirement:
(1) Payments to corporations. However, payments to corporations
providing medical and health care services or engaged in the billing and
collecting of payments for such services are not exempted.
(2) Payments for bills for merchandise, telegrams, telephone,
freight, storage, and similar charges.
(3) Payments of income required to be reported on an IRS Form W-2
(e.g., contracts for personal services).
(4) Payments to a hospital or extended care facility described in 26
CFR 501(c)(3) that is exempt from taxation under 26 CFR 501(a).
(5) Payments to a hospital or extended care facility owned and
operated by the United States, a state, the District of Columbia, a
possession of the United States, or a political subdivision, agency, or
instrumentality of any of the foregoing.
(6) Payments for any contract with a state, the District of
Columbia, a possession of the United States, or a political subdivision,
agency, or instrumentality of any of the foregoing.
(c) The following information is required to provide reports to the
IRS:
(1) Name, address, and TIN of contractor.
(2) Corporate status (see 4.901).
(d) Transmit to paying offices the information specified in 4.203.
Sec. 4.904 Solicitation provision.
The contracting officer shall insert the provision at 52.204-3,
Taxpayer Identification, in solicitations, unless the TIN of each
offeror has previously been obtained and is known.
[[Page 77]]
SUBCHAPTER B--ACQUISITION PLANNING
PART 5--PUBLICIZING CONTRACT ACTIONS--Table of Contents
Sec.
5.000 Scope of part.
5.001 Definition.
5.002 Policy.
Subpart 5.1--Dissemination of Information
5.101 Methods of disseminating information.
5.102 Availability of solicitations.
Subpart 5.2--Synopses of Proposed Contract Actions
5.201 General.
5.202 Exceptions.
5.203 Publicizing and response time.
5.204 Presolicitation notices.
5.205 Special situations.
5.206 Publicizing subcontract opportunities.
5.207 Preparation and transmittal of synopses.
Subpart 5.3--Synopses of Contract Awards
5.301 General.
5.302 Preparation and transmittal of synopses of awards.
5.303 Announcement of contract awards.
Subpart 5.4--Release of Information
5.401 General.
5.402 General public.
5.403 Requests from Members of Congress.
5.404 Release of long-range acquisition estimates.
5.404-1 Release procedures.
5.404-2 Announcements of long-range acquisition estimates.
5.405 Exchange of acquisition information.
Subpart 5.5--Paid Advertisements
5.501 Definitions.
5.502 Authority.
5.503 Procedures.
5.504 Use of advertising agencies.
Authority: 40 U.S.C. 486(c); 10 U.S.C. Chapter 137; and 42 U.S.C.
2473(c).
Source: 48 FR 42119, Sept. 19, 1983, unless otherwise noted.
Sec. 5.000 Scope of part.
This part prescribes policies and procedures for publicizing
contract opportunities and award information.
Sec. 5.001 Definition.
Contract action, as used in this part, means an action resulting in
a contract, as defined in subpart 2.1, including contract modifications
for additional supplies or services, but not including contract
modifications that are within the scope and under the terms of the
contract, such as contract modifications issued pursuant to the Change
clause, or funding and other administrative changes.
[50 FR 1728, Jan. 11, 1985, and 50 FR 52429, Dec. 23, 1985]
Sec. 5.002 Policy.
Contracting officers shall publicize contract actions in order to--
(a) Increase competition;
(b) Broaden industry participation in meeting Government
requirements; and
(c) Assist small business concerns, small disadvantaged business
concerns, and women-owned small business concerns in obtaining contracts
and subcontracts.
[50 FR 52429, Dec. 23, 1985, as amended at 60 FR 48259, Sept. 18, 1995]
Subpart 5.1--Dissemination of Information
Sec. 5.101 Methods of disseminating information.
The Commerce Business Daily (CBD) is the public notification media
by which U.S. Government agencies identify proposed contract actions and
contract awards. The CBD is published in five or six daily editions
weekly, as necessary.
(a) As required by the Small Business Act (15 U.S.C. 637(e)) and the
Office of Federal Procurement Policy Act (41 U.S.C. 416), contracting
officers shall disseminate information on proposed contract actions as
follows:
(1) For proposed contract actions expected to exceed $25,000, by
synopsizing in the Commerce Business Daily (CBD) (see 5.201); and
[[Page 78]]
(2) For proposed contract actions expected to exceed $10,000, but
not expected to exceed $25,000, by displaying in a public place,
including on an electronic bulletin board, or any other appropriate
electronic means located at the contracting office issuing the
solicitation, an unclassified notice of the solicitation or a copy of
the solicitation satisfying the requirements of 5.207 (c) and (f). The
notice shall include a statement that all responsible sources may submit
a quotation which, if timely received, shall be considered by the
agency. Such information shall be posted not later than the date the
solicitation is issued, and shall remain posted for at least 10 days or
until after quotations have been opened, whichever is later.
(i) If solicitations are posted in lieu of a notice, various methods
of satisfying the requirements of 5.207 (c) and (f) may be employed. For
example, the requirements for 5.207 (c) and (f) may be met by stamping
the solicitation, by a cover sheet to the solicitation, or by placing a
general statement in the display room.
(ii) The contracting officer need not comply with the display
requirements of this section when the exemptions at 5.202 (a)(1), (a)(4)
through (a)(9), or (a)(11) apply, or when oral or FACNET solicitations
are used.
(iii) Contracting officers shall post solicitations expected to
exceed $25,000 if required by agency regulations.
(iv) Electronic dissemination available to the public at the
contracting office may be used to satisfy the public display
requirement. Contracting offices utilizing electronic systems for public
posting shall periodically publicize the methods for accessing such
information.
(b) In addition, one or more of the following methods may be used:
(1) Preparing periodic handouts listing proposed contracts, and
displaying them as in 5.101(a)(2).
(2) Assisting local trade associations in disseminating information
to their members.
(3) Making brief announcements of proposed contracts to newspapers,
trade journals, magazines, or other mass communication media for
publication without cost to the Government.
(4) Placing paid advertisements in newspapers or other
communications media, subject to the following limitations:
(i) Contracting officers shall place paid advertisements of proposed
contracts only when it is anticipated that effective competition cannot
be obtained otherwise (see 5.205(d)).
(ii) Contracting officers shall not place advertisements of proposed
contracts in a newspaper published and printed in the District of
Columbia unless the supplies or services will be furnished, or the labor
performed, in the District of Columbia or adjoining counties in Maryland
or Virginia (44 U.S.C. 3701).
(iii) Advertisements published in newspapers must be under proper
written authority in accordance with 44 U.S.C. 3702 (see 5.502(a)).
[48 FR 42119, Sept. 19, 1983, as amended at 50 FR 1728, Jan. 11, 1985;
50 FR 52429, Dec. 23, 1985; 51 FR 27117, July 29, 1986; 52 FR 21885,
June 9, 1987; 56 FR 41731, Aug. 22, 1991; 60 FR 34736, 34746, July 3,
1995; 61 FR 39191, July 26, 1996]
Sec. 5.102 Availability of solicitations.
(a) The contracting officer shall--
(1) Maintain a reasonable number of copies of solicitations
publicized in the CBD, including specifications and other pertinent
information (upon request, potential sources not initially solicited
shall be mailed or provided copies of solicitations, if available);
(2) Provide copies of a limited solicitation to firms requesting
copies that were not initially solicited, but only after advising the
requester of the determination to limit the solicitation to a specified
firm or firms as authorized under part 6;
(3) Provide copies on a first-come-first-served basis, for pickup at
the contracting office, to publishers, trade associations, information
services, and other members of the public having a legitimate interest
(for construction, see 36.211); and
(4) In addition to the methods of disseminating proposed contract
information in 5.101(a) and (b), provide upon request to small business
concerns, as required by 15 U.S.C. 637(b)--
[[Page 79]]
(i) A copy of the solicitation specifications. In the case of
solicitations disseminated by electronic data interchange, solicitations
may be furnished directly to the electronic address of the small
business concern;
(ii) The name and telephone number of an employee of the contracting
office to answer questions on the solicitation; and
(iii) Adequate citations to each applicable major Federal law or
agency rule with which small business concerns must comply in performing
the contract.
(5) Retain a copy of the solicitation and other documents for review
by and duplication for those requesting copies after the initial number
of copies is exhausted.
(6) Agencies may require payment of a fee, not exceeding the actual
cost of duplication, for a copy of the solicitation documents.
(b) This section 5.102 applies to classified contracts to the extent
consistent with agency security requirements (see 5.202(a)(1)).
[48 FR 42119, Sept. 19, 1983, as amended at 50 FR 1728, Jan. 11, 1985;
50 FR 52429, Dec. 23, 1985; 60 FR 34737, July 3, 1995]
Subpart 5.2--Synopses of Proposed Contract Actions
Sec. 5.201 General.
(a) As required by the Small Business Act (15 U.S.C. 637(e)) and the
Office of Federal Procurement Policy Act (41 U.S.C. 416), agencies shall
furnish for publication in the Commerce Business Daily (CBD) notices of
proposed contract actions as specified in paragraph (b) of this section.
(b) For acquisitions of supplies and services other than those
covered by the exceptions in 5.202, and special situations in 5.205, the
contracting officer shall transmit a notice to the CBD (synopsis) (see
5.207) for each proposed--
(1) Contract actions meeting the thresholds in 5.101(a)(1);
(2) Effort to locate private commercial sources for cost comparison
purposes under OMB Circular A-76 (see 5.205(d));
(3) Modification to an existing contract for additional supplies or
services that meets the thresholds in 5.101(a)(1); or
(4) Contract action in any amount when advantageous to industry or
the Government.
(c) The primary purposes of the CBD notice are to improve small
business access to acquisition information and enhance competition by
identifying contracting and subcontracting opportunities.
(d) Subcriptions to the CBD must be placed with the Superintendent
of Documents, Government Printing Office, Washington, DC 20402 (Tel.
202-783-3238).
[48 FR 42119, Sept. 19, 1983, as amended at 50 FR 1728, Jan. 11, 1985;
50 FR 52429, Dec. 23, 1985; 51 FR 27117, July 29, 1986; 52 FR 21886,
June 9, 1987; 60 FR 42653, Aug. 16, 1995]
Sec. 5.202 Exceptions.
The contracting officer need not submit the notice required by 5.201
when--
(a) The contracting officer determines that--
(1) The synopsis cannot be worded to preclude disclosure of an
agency's needs and such disclosure would compromise the national
security (e.g., would result in disclosure of classified information).
The fact that a proposed solicitation or contract action contains
classified information, or that access to classified matter may be
necessary to submit a proposal or perform the contract does not, in
itself, justify use of this exception to synopsis;
(2) The contract action is made under the conditions described in
6.302-2 (or, for purchases conducted using simplified acquisition
procedures, if unusual and compelling urgency precludes competition to
the maximum extent practicable) and the Government would be seriously
injured if the agency complies with the time periods specified in 5.203;
(3) The contract action is one for which either the written
direction of a foreign government reimbursing the agency for the cost of
the acquisition of the supplies or services for such government, or the
terms of an international agreement or treaty between the United States
and a foreign government or international organizations,
[[Page 80]]
has the effect of requiring that the acquisition shall be from specified
sources;
(4) The contract action is expressly authorized or required by a
statute to be made through another Government agency, including
acquisitions from the Small Business Administration (SBA) using the
authority of section 8(a) of the Small Business Act (but see 5.205(f)),
or from a specific source such as a workshop for the blind under the
rules of the Committee for the Purchase from the Blind and Other
Severely Handicapped;
(5) The contract action is for utility services other than
telecommunications services and only one source is available;
(6) The contract action is an order placed under Subpart 16.5;
(7) The contract action results from acceptance of a proposal under
the Small Business Innovation Development Act of 1982 (Pub. L. 97-219);
(8) The contract action results from the acceptance of an
unsolicited research proposal that demonstrates a unique and innovative
concept (see 6.003) and publication of any notice complying with 5.207
would improperly disclose the originality of thought or innovativeness
of the proposed research, or would disclose proprietary information
associated with the proposal. This exception does not apply if the
contract action results from an unsolicited research proposal and
acceptance is based solely upon the unique capability of the source to
perform the particular research services proposed (see 6.302-1(a)(2)(i);
(9) The contract action is made for perishable subsistence supplies,
and advance notice is not appropriate or reasonable;
(10) The contract action is made under conditions described in
6.302-3, or 6.302-5 with regard to brand name commercial items for
authorized resale, or 6.302-7, and advance notice is not appropriate or
reasonable;
(11) The contract action is made under the terms of an existing
contract that was previously synopsized in sufficient detail to comply
with the requirements of 5.207 with respect to the current contract
action;
(12) The contract action is by a Defense agency and the contract
action will be made and performed outside the United States, its
possessions, or Puerto Rico, and only local sources will be solicited.
This exception does not apply to contract actions subject to the Trade
Agreements Act (see subpart 25.4). This exception also does not apply to
North American Free Trade Agreement contract actions, which will be
synopsized in accordance with agency regulations;
(13) The contract action is for an amount expected to exceed $25,000
but not expected to exceed the simplified acquisition threshold and is
made by a contracting activity that has been certified as having
implemented a system with interim (until December 31, 1999) or full
(after December 31, 1999) FACNET and the contract action will be made
through FACNET;
(14) The contract action is for an amount at or below $250,000 and
is made through FACNET after Governmentwide FACNET has been certified
pursuant to 4.505-3; or
(15) The contract action is made under conditions described in
6.302-3 with respect to the services of an expert to support the Federal
Government in any current or anticipated litigation or dispute.
(b) The head of the agency determines in writing after consultation
with the Administrator for Federal Procurement Policy and the
Administrator of the Small Business Administration, that advance notice
is not appropriate or reasonable.
[50 FR 1728, Jan. 11, 1985, as amended at 50 FR 52430, Dec. 23, 1985; 51
FR 27117, July 29, 1986; 53 FR 27463, July 20, 1988; 54 FR 46004, Oct.
31, 1989; 56 FR 15148, Apr. 15, 1991; 56 FR 41744, Aug. 22, 1991; 59 FR
545, Jan. 5, 1994; 60 FR 34746, July 3, 1995; 60 FR 42653, Aug. 16,
1995; 60 FR 49725, Sept. 26, 1995; 61 FR 39192, July 26, 1996]
Sec. 5.203 Publicizing and response time.
Whenever agencies are required to publish notice of contract actions
under 5.201, they shall proceed as follows:
(a) A notice of contract action shall be published in the CBD at
least 15 days before issuance of a solicitation
[[Page 81]]
except when the combined CBD synopsis/solicitation procedure for
acquisition of commercial items is used (see 12.603).
(b) The contracting officer shall establish a solicitation response
time which will afford potential offerors a reasonable opportunity to
respond to (1) each contract action, including actions via FACNET, in an
amount estimated to be greater than $25,000, but not greater than the
simplified acquisition threshold; or (2) each contract action for the
acquisition of commercial items in an amount estimated to be greater
than $25,000 (see part 12). The contracting officer should consider the
circumstances of the individual acquisition, such as the complexity,
commerciality, availability, and urgency, when establishing the
solicitation response time.
(c) Except for the acquisition of commercial items (see 5.203(b)),
agencies shall allow at least a 30-day response time for receipt of bids
or proposals from the date of issuance of a solicitation, if the
contract action is expected to exceed the simplified acquisition
threshold.
(d) Agencies shall allow at least a 30 day response time from the
date of publication of a proper notice of intent to contract for
architect-engineer services or before issuance of an order under a basic
ordering agreement or similar arrangement if the contract action is
expected to exceed the simplified acquisition threshold.
(e) Agencies shall allow at least a 45 day response time for receipt
of bids or proposals from the date of publication of the notice required
in 5.201 for contract actions categorized as research and development if
the contract action is expected to exceed the simplified acquisition
threshold.
(f) Nothing in this subpart prohibits officers or employees of
agencies from responding to requests for information.
(g) Contracting officers may, unless they have evidence to the
contrary, presume that notice has been published 10 days (6 days if
electronically transmitted) following transmittal of the synopsis to the
CBD. This presumption is based on the CBD's confirmation that
publication does occur within these timeframes. This presumption does
not negate the mandatory waiting or response times specified in
paragraphs (a) through (d) of this section. Upon learning that a
particular notice has not in fact been published within the presumed
timeframes, contracting officers should consider whether the date for
receipt of offers can be extended or whether circumstances have become
sufficiently compelling to justify proceeding with the contract action
under the authority of 5.202(a)(2).
[50 FR 52430, Dec. 23, 1985, as amended at 51 FR 31425, Sept. 3, 1986;
60 FR 34747, July 3, 1995; 60 FR 48236, Sept. 18, 1995; 61 FR 39192,
July 26, 1996]
Sec. 5.204 Presolicitation notices.
Contracting officers shall publicize presolicitation notices in the
CBD (see 15.404 and 36.302). Synopsizing is still required prior to
issuance of any resulting solicitation (see 5.201 and 5.203).
[50 FR 1729, Jan. 11, 1985 and 50 FR 52429, Dec. 23, 1985]
Sec. 5.205 Special situations.
(a) Research and development (R&D) advance notice. Contracting
officers may publish in the CBD, advance notices of their interest in
potential R&D programs whenever existing solicitation mailing lists do
not include a sufficient number of concerns to obtain adequate
competition. Advance notices shall not be used where security
considerations prohibit such publication. Advance notices will enable
potential sources to learn of R&D programs and provide their sources
with an opportunity to submit information which will permit evaluation
of their R&D capabilities. Potential sources which respond to advance
notices shall be added to the appropriate solicitation mailing list for
subsequent solicitation. Advance notices shall be titled ``Research and
Development Sources Sought,'' cite the appropriate Numbered Note, and
include the name and telephone number of the contracting officer or
other contracting activity official from whom technical details of the
project can be obtained. This will enable sources to submit information
for evaluation of their R&D capabilities. Contracting officers shall
synopsize all subsequent solicitations for R&D contracts, including
those resulting from a
[[Page 82]]
previously synopsized advance notice, unless one of the exceptions in
5.202 applies.
(b) Federally Funded Research and Development Centers. Before
establishing a Federally Funded Research and Development Center (FFRDC)
(see part 35) or before changing its basic purpose and mission, the
sponsor shall place at least three notices over a 90-day period in the
Commerce Business Daily and the Federal Register, indicating the
agency's intention to sponsor an FFRDC or change the basic purpose and
mission of an FFRDC. The notice shall indicate the scope and nature of
the effort to be performed and request comments. Notice is not required
where action is required by law.
(c) Special notices. Contracting officers may publish in the CBD
special notices of procurement matters such as business fairs, long-
range procurement estimates, pre-bid/pre-proposal conferences, meetings,
and the availability of draft solicitations or draft specifications for
review. Special notices shall be transmitted to the CBD in accordance
with 5.207.
(d) Architect-engineering services. Contracting officers shall
publish notices of intent to contract for architect-engineering services
as follows:
(1) Except when exempted by 5.202, contracting officers shall
synopsize each proposed contract action for which the total fee
(including phases and options) is expected to exceed $25,000. Reference
shall be made to the appropriate CBD Numbered Note.
(2) When the total fee is expected to exceed $10,000 but not exceed
$25,000, the contracting officer shall comply with 5.101(a)(2). When the
contract action is not required to be synopsized under subparagraph
(d)(1) of this section, the contracting officer shall display a notice
of the solicitation or a copy of the solicitation in a public place at
the contracting office. Other optional publicizing methods are
authorized in accordance with 5.101(b).
(e) Effort to locate commercial sources under OMB Circular A-76.
When determining the availability of commercial sources under the
procedures prescribed in subpart 7.3 and OMB Circular A-76, the
contracting officer shall not arrive at a conclusion that there are no
commercial sources capable of providing the required supplies or
services until publicizing the requirement in the CBD at least three
times in a 90 calendar-day period, with a minimum of 30 calendar days
between each. When necessary to meet an urgent requirement, this may be
limited to a total of two publications in the CBD in a 30 calendar-day
period, with a minimum of 15 calendar days between each.
(f) Section 8(a) competitive acquisition. When a national buy
requirement is being considered for competitive acquisition limited to
eligible 8(a) concerns under Subpart 19.8, the contracting officer shall
transmit a synopsis of the proposed contract action to the CBD in
accordance with 5.207. The synopsis may be transmitted to the CDB
concurrent with submission of the agency offering (see 19.804-2) to the
Small Business Administration (SBA). The synopsis should also include
information--
(1) Advising that the acquisition is being offered for competition
limited to eligible 8(a) concerns;
(2) Specifying the Standard Industrial Classification (SIC) code;
(3) Advising that eligibility to participate may be restricted to
firms in either the developmental or transitional stage; and
(4) Encouraging interested 8(a) firms to request a copy of the
solicitation as expeditiously as possible since the solicitation will be
issued without further notice upon SBA acceptance of the requirement for
the section 8(a) Program.
[48 FR 42119, Sept. 19, 1983, as amended at 50 FR 1729, Jan. 11, 1985;
50 FR 4221, Jan. 30, 1985; 50 FR 52430, Dec. 23, 1985; 51 FR 27117, July
29, 1986; 52 FR 21886, June 9, 1987; 53 FR 43389, Oct. 26, 1988; 54 FR
25061, June 12, 1989; 54 FR 46004, Oct. 31, 1989; 55 FR 3881, Feb. 5,
1990; 55 FR 25526, June 21, 1990; 55 FR 52789, Dec. 21, 1990; 56 FR
41731, Aug. 22, 1991; 60 FR 34747, July 3, 1995; 61 FR 39192, July 26,
1996]
Sec. 5.206 Publicizing subcontract opportunities.
Prime contractors may use the CBD to publicize subcontracting
opportunities stemming from receipt of a Government contract. The CBD
can be used to seek competition for subcontracts, to increase
participation by small, small disadvantaged, and women-owned business
firms, and to
[[Page 83]]
meet established subcontracting plan goals. Synopses of subcontract
opportunities should be prepared and submitted in accordance with 5.207.
[57 FR 60574, Dec. 21, 1992]
Sec. 5.207 Preparation and transmittal of synopses.
(a) Transmittal. Contracting officers shall transmit synopses of
actions identified under 5.101 to the Commerce Business Daily by the
most expeditious and reliable means available.
(1) Electronic transmission. All synopses transmitted by electronic
means shall be in ASCII Code. Contact your agency's communications
center for the appropriate transmission instructions or services.
(2) Hard copy transmission. When electronic transmission is not
feasible, synopses should be sent to the CBD via mail or other physical
delivery of hard copy and should be addressed to: U.S. Department of
Commerce, Commerce Business Daily, P.O. Box 5999, Chicago, IL 60680.
(b) Format. The contracting officer shall prepare the synopsis in
the following style and format to ensure timely processing of the
synopsis by the Commerce Business Daily.
(1) General. Format for all synopses shall employ conventional
typing with abbreviations, capitalization, and punctuation all
grammatically correct. Each synopsis shall include all 17 format items.
Do not include the title for the format item.
(2) Spacing. Begin each line flush left and use double spaced lines
between each format line. If more than one synopsis is sent at one time,
separate each synopsis with four line spaces and begin each new synopsis
with format item number 1.
(3) Abbreviations. Minimize abbreviations or acronyms to commonly
recognized abbreviations.
(4) Standard format. Prepare each synopsis in the following format.
Begin each format item with the number of the item followed by a period
(e.g., 1.). Then make two spaces after the period. Next type the
appropriate information for each format item. Then conclude each format
item with two exclamation points (i.e., !!). Conclude each complete
synopsis, following format item 17, with five asterisks (i.e., * * * *
*).
Format Item and Explanation/Description of Entry
1. ACTION CODE
(A single alphabetic character denoting the specific action related
in the synopsis. Choices are limited to the following: P=Presolicitation
Notice/Procurement; A=Award announcement; M=Modification of a previously
announced procurement action (a correction to a previous CBD
announcement); R=Sources Sought (includes A-76 services and architect-
engineer contracts). If none of the standard codes apply, enter ``N/
A''.)
2. DATE
(Date on which the synopsis is transmitted to the CBD for
publication. Use a four digit number indicating month in two digits and
date in two digits (MMDD). All four spaces must be used with preceding 0
for months January thru September. Format: 0225 for February 25.)
3. YEAR
(Two numeric digits denoting the calendar year of the synopsis.
Format 85 for 1985.)
4. GOVERNMENT PRINTING OFFICE (GPO) BILLING ACCOUNT CODE.
(The originating office's account number used by the GPO for billing
and collection purposes. The field length is nine alpha-numeric
characters. The first three characters entered are ``GPO'' and then the
following six characters are the numeric account number. Agencies should
contact the GPO's Office of Comptroller for additional information.
Enter N/A if an account number has not been assigned.)
5. CONTRACTING OFFICE ZIP CODE
(The geographic zip code for the contracting office. Up to nine
characters may be entered. When using a nine digit zip code, separate
the first five digits and last four digits with a dash. Format: 00000-
0000.)
6. CLASSIFICATION CODE. (Service or supply code number; see
5.207(g). Each synopsis shall classify the contemplated contract action
under the one classification code which most closely describes the
acquisition. If the action is for a multiplicity of goods and/or
services, the preparer should select the one category best describing
the overall acquisition based upon value. Inclusion of more than one
classification code, or failure to include a classification code, will
result in rejection of the synopsis by the Commerce Business Daily).
7. CONTRACTING OFFICE ADDRESS
[[Page 84]]
(The complete name and address of the contracting office. Field
length is open, but generally not expected to exceed 90 alpha-numeric
characters.)
8. SUBJECT
(Insert classification code for ITEM 6, and a brief title
description of services, supplies, or project required by the agency.
This will appear in the CBD as the bold faced title in the first line of
the description.) (200 character spaces available.)
9. PROPOSED SOLICITATION NUMBER
(Agency number for control, tracking, identification. For
solicitations; if not a solicitation, enter N/A.)
10. OPENING/CLOSING RESPONSE DATE
(For solicitations; if not a solicitation, enter N/A. Issuing agency
deadline for receipt of bids, proposals or responses. Use a six digit
date. Format: MMDDYY. Explanation may appear in text of synopsis in Item
17.)
11. CONTACT POINT/CONTRACTING OFFICER
(Include name and telephone number of contact. Also include name and
telephone number of contracting officer if different. This will appear
as the first item of information in the published entry. This entry may
be alpha-numeric and up to 320 character blocks in length.)
12. CONTRACT AWARD AND SOLICITATION NUMBER
(For awards; if not an award, enter N/A. The award, solicitation or
project reference number assigned by the agency to provide a reference
for bidders/subcontractors. Two hundred character spaces available for
alpha-numeric entries.)
13. CONTRACT AWARD DOLLAR AMOUNT
(For awards; if not an award, enter N/A. A ten digit numeric field.
Enter whole dollars only. Output will be preceded by a dollar sign ($).)
14. CONTRACT LINE ITEM NUMBER
(For awards--as desired; if not an award, enter N/A. The alpha-
numeric field with dashes and slashes may not exceed 32 spaces. If
sufficient space is not available, enter N/A and insert the contract
line item number(s) in format item 17.)
15. CONTRACT AWARD DATE
(For awards; if not an award, enter N/A. A six digit entry showing
the date the award is made or the contract let. Format: MMDDYY.)
16. CONTRACTOR
(For awards; if not an award, enter N/A. Name and address of
successful offeror. Four hundred character spaces allowed for full
identification.)
17. DESCRIPTION
(Enter a clear and concise description of the action. The
description may not exceed 12,000 textual characters (approximately 3\1/
2\ single spaced pages). The suggested sequence of the content and items
for inclusion in the description are contained in 5.207(c). Insert N/A
when synopsizing awards.)
(5) Nonapplicable format items. When a format item is not
applicable, type the item number, a period, two blank spaces, and ``N/
A'' (e.g., 10. N/A!!).
(6) The following is a sample CBD synopsis:
1. P!!
2. 0925!!
3. 85!!
4. GPO123456!!
5. 19111-5096!!
6. 95!!
7. Defense Industrial Supply Center, 700 Robbins Ave., Philadelphia,
PA 19111-5096!!
8. 95--Steel Plate!!
9. DLA500-86-B-0090!!
10. BOD, 111585!!
11. Contact, Mary Drake, 215/697-XXXX/Contracting Officer, Larry
Bird, 215/697-XXXX!!
12. N/A!!
13. N/A!!
14. N/A!!
15. N/A!!
16. N/A!!
17. NSN9515-00-237-5342, Spec Mil-S-226988, 0.1875 inch thick, 96
inch width. 240 inch length. Carbon steel, 45,000 lbs. Delivery to NSY
Philadelphia, PA, and NSC Norfolk, VA. Delivery by 1 Oct. 86. When
calling, be prepared to state name, address, and solicitation number.
See note 9. All responsible sources may submit an offer which will be
considered. * * * * *
(c) General format for Item 17, ``Description.'' (1) Prepare a clear
and concise description of the supplies or services that is not
unnecessarily restrictive of competition and will allow a prospective
offeror to make an informed business judgment as to whether a copy of
the solicitation should be requested.
(2) Do not include in Item 17 the CBD supply or service
classification code from Item 6.
(i) National Stock Number (NSN) if assigned.
(ii) Specification and whether an offeror, its product, or service
must meet a qualification requirement in order to be eligible for award,
and identification of the office from which additional information about
the qualification requirement may be obtained (see subpart 9.2).
(iii) Manufacturer, including part number, drawing number, etc.
[[Page 85]]
(iv) Size, dimensions, or other form, fit or functional description.
(v) Predominant material of manufacture.
(vi) Quantity, including any options for additional quantities.
(vii) Unit of issue.
(viii) Destination information.
(ix) Delivery schedule.
(x) Duration of the contract period.
(xi) For a contract action in an amount estimated to be greater than
$25,000 but not greater than the simplified acquisition threshold, enter
(A) a description of the procedures to be used in awarding the contract
(e.g., request for oral or written quotation or solicitation), and (B)
the anticipated award date.
(xii) For Architect-Engineer projects and other projects for which
the supply or service codes are insufficient, provide brief details with
respect to: location, scope of services required, cost range and
limitations, type of contract, estimated starting and completion dates,
and any significant evaluation factors.
(xiii) Numbered notes (see 5.207(e)), including instructions for
set-asides for small businesses.
(xiv) In the case of noncompetitive contract actions (including
those that do not exceed the simplified acquisition threshold), identify
the intended source (see 5.207(e)(3)) and insert a statement of the
reason justifying the lack of competition.
(xv) Insert a statement that all responsible sources may submit a
bid, proposal, or quotation which shall be considered by the agency.
(xvi) If the contracting office will accept requests for
solicitations through alternate means (e.g., facsimile machine, Telex),
provide the machine number and routing instructions.
(xvii) If the solicitation will be made available to interested
parties through electronic data interchange, provide any information
necessary to obtain and respond to the solicitation electronically.
(d) Set-asides. When the proposed acquisition provides for a total
or partial small business set aside, the appropriate CBD Numbered Note
will be cited.
(e) CBD Numbered Notes. (1) Numbered Notes are footnotes. The
purpose of the Numbered Notes is to conserve space and simplify the
identification of repetitive notices. An explanation of the Numbered
Notes appears each week in the Monday edition of the CBD. If the Monday
edition of the CBD is not printed because of a holiday, an explanation
of the Numbered Notes will appear in the next day's issue. When one or
more of the Notes applies to a synopsis, contracting officers should
reference the note at the end of Item 17 of the synopsis; e.g., ``See
Note(s). . . .'' Requests to add or change Notes will be submitted
through channels for approval by the DAR Council and the CAA Council.
The Councils will review the Numbered Notes periodically and, as
appropriate, after consultation with the initiating agency, advise the
Department of Commerce to delete or modify outdated or unused notes from
the CBD. Contracting officers shall also include the substance of
Numbered Notes whenever a proposed contract is publicized by means other
than the CBD (see 5.101).
(2) If the acquisition is subject to the requirements of the Trade
Agreements Act of 1979 (see part 25), Numbered Note 12 shall be
referenced in the synopsis.
(3) In the case of a noncompetitive contract action expected to
exceed the simplified acquisition threshold, the synopsis shall refer to
Numbered Note 22. If it is anticipated that award will be made via a
delivery order to an existing basic ordering agreement, the synopsis
shall so state.
(4) If, under the proposed acquisition, the Government does not
intend to acquire a commercial item using part 12, the synopsis shall
refer to Numbered Note 26.
(f) Information not covered by Numbered Notes. To alert prospective
contractors to information not covered by Numbered Notes, contracting
officers should identify the following unusual circumstances in the
synopsis:
(1) Availability of specification, plans, drawing, or other
technical data. It is impracticable to distribute the applicable ------
------ [insert `specifications,' `plans,' `drawings,' or other
appropriate
[[Page 86]]
words] with the solicitation. These contract documents may be examined
or obtained at ------------
(2) Availability of background research report. This contract for
basic research is a continuation of an effort conducted for the past --
------ [insert period]. A research report containing findings to date is
not available to the Government.
(3) Production requirements. The production of the supplies listed
requires a substantial initial investment or an extended period of
preparation for manufacture.
(4) Place of performance unknown. This contract is subject to the
Service Contract Act and the place of performance is unknown. Wage
determinations have been requested for (insert localities). The
contracting officer will request wage determinations for additional
localities if asked to do so in writing by (insert time and date).
(g) Codes to be Used in Synopses to Identify Services or Supplies.
(1) Contracting officers shall use one of the following classification
codes when the contemplated contract action is for services or when the
overall acquisition can best be described as services based upon value:
------------------------------------------------------------------------
Code Description
------------------------------------------------------------------------
A Research and development.
B Special studies and analysis--not R&D.
C Architect and engineering services.
D Information technology services,
including telecommunications services.
E Purchase of structures and facilities.
F Natural resources and conservation
services.
G Social services.
H Quality control, testing, and
inspection services.
J Maintenance, repair, and rebuilding of
equipment.
K Modification of equipment.
L Technical representative services.
M Operation of Government-owned
facilities.
N Installation of equipment.
P Salvage services.
Q Medical services.
R Professional, administrative, and
management support services.
S Utilities and housekeeping services.
T Photographic, mapping, printing, and
publication services.
U Education and training services.
V Transportation, travel, and relocation
services.
W Lease or rental of equipment.
X Lease or rental of facilities.
Y Construction of structures and
facilities.
Z Maintenance, repair, and alteration of
real property.
------------------------------------------------------------------------
(2) Contracting officers shall use one of the following
classification codes when the contemplated contract action is for
supplies or when the overall acquisition can best be described as
supplies based upon value:
Code Description
10 Weapons.
11 Nuclear ordnance.
12 Fire control equipment.
13 Ammunition and explosives.
14 Guided missiles.
15 Aircraft and airframe structural
components.
16 Aircraft components and accessories.
17 Aircraft launching, landing, and ground
handling equipment.
18 Space vehicles.
19 Ships, small craft, pontoons, and
floating docks.
20 Ship and marine equipment.
22 Railway equipment.
23 Ground effect vehicles, motor vehicles,
trailers, and cycles.
24 Tractors.
25 Vehicular equipment components.
26 Tires and tubes.
28 Engines, turbines, and components.
29 Engine accessories.
30 Mechanical power transmission equipment.
31 Bearings.
32 Woodworking machinery and equipment.
34 Metalworking machinery.
35 Service and trade equipment.
36 Special industry machinery.
37 Agricultural machinery and equipment.
38 Construction, mining, excavating, and
highway maintenance equipment.
39 Materials handling equipment.
40 Rope, cable, chain, and fittings.
41 Refrigeration, air-conditioning, and air
circulating equipment.
42 Fire fighting, rescue, and safety
equipment.
43 Pumps and compressors.
44 Furnace, steam plant, and drying
equipment; and nuclear reactors.
45 Plumbing, heating, and sanitation
equipment.
46 Water purification and sewage treatment
equipment.
47 Pipe, tubing, hose, and fittings.
48 Valves.
49 Maintenance and repair shop equipment.
51 Hand tools.
52 Measuring tools.
53 Hardware and abrasives.
54 Prefabricated structures and
scaffolding.
55 Lumber, millwork, plywood, and veneer.
56 Construction and building materials.
58 Communication, detection, and coherent
radiation equipment.
59 Electrical and electronic equipment
components.
60 Fiber optics materials, components,
assemblies, and accessories.
61 Electric wire, and power and
distribution equipment.
62 Lighting fixtures and lamps.
63 Alarm, signal, and security detection
systems.
65 Medical, dental, and veterinary
equipment and supplies.
66 Instruments and laboratory equipment.
67 Photographic equipment.
68 Chemicals and chemical products.
69 Training aids and devices.
70 General-purpose information technology
equipment.
71 Furniture.
72 Household and commercial furnishings and
appliances.
[[Page 87]]
73 Food preparation and serving equipment.
74 Office machines, text processing
systems, and visible record equipment.
75 Office supplies and devices.
76 Books, maps, and other publications.
77 Musical instruments, phonographs, and
home-type radios.
78 Recreational and athletic equipment.
79 Cleaning equipment and supplies.
80 Brushes, paints, sealers, and adhesives.
81 Containers, packaging, and packing
supplies.
83 Textiles, leather, furs, apparel and
shoe findings, tents, and flags.
84 Clothing, individual equipment, and
insignia.
85 Toiletries.
87 Agricultural supplies.
88 Live animals.
89 Subsistence.
91 Fuels, lubricants, oils, and waxes.
93 Nonmetallic fabricated materials.
94 Nonmetallic crude materials.
95 Metal bars, sheets, and shapes.
96 Ores, minerals, and their primary
products.
99 Miscellaneous.
(3) Only one classification code shall be reported. If more than one
code is applicable, the contracting officer shall use the code which
describes the predominant product or service being procured. The FPDS
Product and Service Codes Manual, October 1988, may be used to identify
a specific product or service within each code.
(h) Cancellation of synopsis. Contracting officers should not
publish notices of solicitation cancellations (or indefinite
suspensions) of contract actions in the CBD. Cancellations of
solicitations shall be made in accordance with 14.209 and 14.404-1.
[48 FR 42119, Sept. 19, 1983, as amended at 50 FR 1729, Jan. 11, 1985;
50 FR 4221, Jan. 30, 1985; 50 FR 52430, Dec. 23, 1985; 51 FR 27117, July
29, 1986; 53 FR 17856, May 18, 1988; 54 FR 19813, May 8, 1989; 54 FR
25061, June 12, 1989; 55 FR 52789, Dec. 21, 1990; 56 FR 67128, Dec. 27,
1991; 59 FR 11387, Mar. 10, 1994; 60 FR 34737, 34747, July 3, 1995; 60
FR 48236, 48259, 48272, Sept. 18, 1995; 61 FR 39192, July 26, 1996; 61
FR 41468, Aug. 8, 1996]
Subpart 5.3--Synopses of Contract Awards
Sec. 5.301 General.
(a) Except for contract actions described in paragraph (b) of this
section, contracting officers shall synopsize in the Commerce Business
Daily (CBD) awards exceeding $25,000 that (1) are subject to the Trade
Agreements Act (see 25.402 and 25.403), or (2) are likely to result in
the award of any subcontracts. However, the dollar threshold is not a
prohibition against publicizing an award of a smaller amount when
publicizing would be advantageous to industry or to the Government.
(b) A notice is not required under paragraph (a) of this section
if--
(1) The notice would disclose the executive agency's needs and the
disclosure of such needs would compromise the national security;
(2) The award results from acceptance of an unsolicited research
proposal that demonstrates a unique and innovative research concept and
publication of any notice would disclose the originality of thought or
innovativeness of the proposed research or would disclose proprietary
information associated with the proposal;
(3) The award results from a proposal submitted under the Small
Business Innovation Development Act of 1982 (Pub. L. 97-219);
(4) The contract action is an order placed under Subpart 16.5;
(5) The award is made for perishable subsistence supplies;
(6) The award is for utility services, other than telecommunications
services, and only one source is available;
(7) The contract action is for an amount greater than $25,000 but
not greater than the simplified acquisition threshold, the contract
action is made by a contracting office that has been certified as having
implemented a system with interim (until December 31, 1999) or full
(after December 31, 1999) FACNET, and the contract action has been made
through FACNET; or
(8) The award is for the services of an expert to support the
Federal Government in any current or anticipated litigation or dispute
pursuant to the exception to full and open competition authorized at
6.302-3.
(c) With respect to acquisitions subject to the Trade Agreements
Act, contracting officers shall submit synopses in sufficient time to
permit their publication in the CBD not later than 60 days after award.
[52 FR 19802, May 27, 1987, as amended at 53 FR 27463, July 20, 1988; 60
FR 34747, July 3, 1995; 60 FR 42653, Aug. 16, 1995; 60 FR 49725, Sept.
26, 1995]
[[Page 88]]
Sec. 5.302 Preparation and transmittal of synopses of awards.
Contracting officers shall transmit synopses of contract awards in
the same manner as prescribed in 5.207.
[55 FR 52790, Dec. 21, 1990]
Sec. 5.303 Announcement of contract awards.
(a) Public announcement. Contracting officers shall make information
available on awards over $3 million (unless another dollar amount is
specified in agency acquisition regulations) in sufficient time for the
agency concerned to announce it by 5:00 p.m. Washington, DC time on the
day of award. Contracts excluded from this reporting requirement include
(1) those placed with the Small Business Administration under Section
8(a) of the Small Business Act, (2) those placed with foreign firms when
the place of delivery or performance is outside the United States or its
possessions, and (3) those for which synopsis was exempted under
5.202(a)(1). Agencies shall not release information on awards before the
public release time of 5:00 p.m. Washington, DC time.
(b) Local announcement. Agencies may also release information on
contract awards to the local press or other media. When local
announcements are made for contract awards in excess of the simplified
acquisition threshold, they shall include--
(1) For awards after sealed bidding, a statement that the contract
was awarded after competition by sealed bidding, the number of offers
solicited and received, and the basis for selection (e.g., the lowest
responsible bidder); or
(2) For awards after negotiation, the information prescribed by
15.1002(c), and after competitive negotiation (either price or design
competition), a statement to this effect, and in general terms the basis
for selection.
[48 FR 42119, Sept. 19, 1983, as amended at 50 FR 1729, Jan. 11, 1985;
50 FR 52429, Dec. 23, 1985; 52 FR 30076, Aug. 12, 1987; 55 FR 3881, Feb.
5, 1990; 56 FR 67128, Dec. 27, 1991; 59 FR 67017, Dec. 28, 1994; 60 FR
34747, July 3, 1995; 60 FR 42653, Aug. 16, 1995; 61 FR 39190, July 26,
1996]
Subpart 5.4--Release of Information
Sec. 5.401 General.
(a) A high level of business security must be maintained in order to
preserve the integrity of the acquisition process. When it is necessary
to obtain information from potential contractors and others outside the
Government for use in preparing Government estimates, contracting
officers shall ensure that the information is not publicized or
discussed with potential contractors.
(b) Contracting officers may make available maximum information to
the public, except information--
(1) On plans that would provide undue or discriminatory advantage to
private or personal interests;
(2) Received in confidence from an offeror;
(3) Otherwise requiring protection under Freedom of Information Act
(see subpart 24.2) or Privacy Act (see subpart 24.1); or
(4) Pertaining to internal agency communications (e.g., technical
reviews, contracting authority or other reasons, or recommendations
referring thereto).
(c) This policy applies to all Government personnel who participate
directly or indirectly in any stage of the acquisition cycle.
Sec. 5.402 General public.
Contracting officers shall process requests for specific information
from the general public, including suppliers, in accordance with subpart
24.1 or 24.2, as appropriate.
Sec. 5.403 Requests from Members of Congress.
(a) Individual requests. Contracting officers shall give Members of
Congress, upon their request, detailed information regarding any
particular contract. When responsiveness would result in disclosure of
classified matter, business confidential information, or information
prejudicial to competitive acquisition, the contracting officer shall
refer the proposed reply, with full documentation, to the agency head
and inform the legislative liaison office of the action.
[[Page 89]]
(b) Inclusion on solicitation mailing lists. Upon request of a
Congressional Committee or Subcommittee Chairperson, contracting
officers shall place any member of a Committee or Subcommittee on the
applicable solicitation mailing lists to receive automatic distribution
of solicitations in the specific area of interest.
[48 FR 42119, Sept. 19, 1983, as amended at 50 FR 1729, Jan. 11, 1985;
50 FR 52429, Dec. 23, 1985]
Sec. 5.404 Release of long-range acquisition estimates.
To assist industry planning and to locate additional sources of
supply, it may be desirable to publicize estimates of unclassified long-
range acquisition requirements. Estimates may be publicized as far in
advance as possible.
Sec. 5.404-1 Release procedures.
(a) Application. The agency head, or a designee, may release long-
range acquisition estimates if the information will--
(1) Assist industry in its planning and facilitate meeting the
acquisition requirements;
(2) Not encourage undesirable practices (e.g., attempts to corner
the market or hoard industrial materials); and
(3) Not indicate the existing or potential mobilization of the
industry as a whole.
(b) Conditions. The agency head shall ensure that--
(1) Classified information is released through existing security
channels in accordance with agency security regulations;
(2) The information is publicized as widely as practicable to all
parties simultaneously by any of the means described in this part;
(3) Each release states that (i) the estimate is based on the best
information available, (ii) the information is subject to modification
and is in no way binding on the Government, and (iii) more specific
information relating to any individual item or class of items will not
be furnished until the proposed acquisition is synopsized in the CBD, or
the solicitation is issued;
(4) Each release contains the name and address of the contracting
officer that will process the acquisition;
(5) Modifications to the original release are publicized as soon as
possible, in the same manner as the original; and
(6) Each release--
(i) Is coordinated in advance with small business, public
information, and public relations personnel, as appropriate;
(ii) Contains, if applicable, a statement that small business set-
asides may be involved, but that a determination can be made only when
acquisition action is initiated; and
(iii) Contains the name or description of the item, and the
estimated quantity to be acquired by calendar quarter, fiscal year, or
other period. It may also contain such additional information as the
number of units last acquired, the unit price, and the name of the last
supplier.
[48 FR 42119, Sept. 19, 1983, as amended at 60 FR 48259, Sept. 18, 1995]
Sec. 5.404-2 Announcements of long-range acquisition estimates.
Further publication, consistent with the needs of the individual
case, may be accomplished by announcing in the CBD that long-range
acquisition estimates have been published and are obtainable, upon
request, from the contracting officer.
Sec. 5.405 Exchange of acquisition information.
(a) When the same item or class of items is being acquired by more
than one agency, or by more than one contracting activity within an
agency, the exchange and coordination of pertinent information,
particularly cost and pricing data, between these agencies or
contracting activities is necessary to promote uniformity of treatment
of major issues and the resolution of particularly difficult or
controversial issues. The exchange and coordination of information is
particularly beneficial during the period of acquisition planning,
presolicitation, evaluation, and pre-award survey.
(b) When substantial acquisitions of major items are involved or
when the contracting activity deems it desirable, the contracting
activity shall request appropriate information (on both
[[Page 90]]
the end item and on major subcontracted components) from other agencies
or contracting activities responsible for acquiring similar items. Each
agency or contracting activity receiving such a request shall furnish
the information requested. The contracting officer, early in a
negotiation of a contract, or in connection with the review of a
subcontract, shall request the contractor to furnish information as to
the contractor's or subcontractor's previous Government contracts and
subcontracts for the same or similar end items and major subcontractor
components.
Subpart 5.5--Paid Advertisements
Sec. 5.501 Definitions.
Advertisement, as used in this subpart, means any single message
prepared for placement in communication media, regardless of the number
of placements.
Publication, as used in this subpart, means (a) the placement of an
advertisement in a newspaper, magazine, trade or professional journal,
or any other printed medium, or (b) the broadcasting of an advertisement
over radio or television.
Sec. 5.502 Authority.
(a) Newspapers. Authority to approve the publication of paid
advertisements in newspapers is vested in the head of each agency (44
U.S.C. 3702). This approval authority may be delegated (5 U.S.C. 302
(b)). Contracting officers shall obtain written authorization in
accordance with agency procedures before advertising in newspapers.
(b) Other media. Unless the agency head determines otherwise,
advance written authorization is not required to place advertisements in
media other than newspapers.
Sec. 5.503 Procedures.
(a) General. (1) Orders for paid advertisements may be placed
directly with the media or through an advertising agency. Contracting
officers shall give small, small disadvantaged and women-owned small
business concerns maximum opportunity to participate in these
acquisitions.
(2) The contracting officer shall use the SF 1449 for paper
solicitations. The SF 1449 shall be used to make awards or place orders
unless the award/order is made via FACNET or by using the Governmentwide
commercial purchase card for micro-purchases.
(b) Rates. Advertisements may be paid for at rates not over the
commercial rates charged private individuals, with the usual discounts
(44 U.S.C. 3703).
(c) Proof of advertising. Every invoice for advertising shall be
accompanied by a copy of the advertisement or an affidavit of
publication furnished by the publisher, radio or television station, or
advertising agency concerned (44 U.S.C. 3703). Paying offices shall
retain the proof of advertising until the General Accounting Office
settles the paying office's account.
(d) Payment. Upon receipt of an invoice supported by proof of
advertising, the contracting officer shall attach a copy of the written
authority (see 5.502(a)) and submit the invoice for payment under agency
procedures.
[48 FR 42119, Sept. 19, 1983, as amended at 54 FR 48982, Nov. 28, 1989;
60 FR 34747, July 3, 1995; 60 FR 48259, Sept. 18, 1995; 61 FR 39192,
July 26, 1996]